Minnesota Legislature
Office of the Revisor of Statutes
Minnesota Session Laws - 1996, Regular Session
Key: (1) language to be deleted (2) new language
KEY: stricken = old language to be removed
underscored = new language to be added
CHAPTER 471-H.F.No. 2102
An act relating to the financing and operation of
government in this state; modifying certain tax rates,
credits, refunds, bases, and exemptions; modifying
property tax valuation and classification; changing
tax increment financing, special services district,
and taxing district provisions; authorizing local
taxes; authorizing certain special districts;
providing local levy or other authority; providing for
distribution of production tax proceeds; providing for
certain tax base sharing; changing certain aids;
providing local performance aid; modifying revenue
recapture; making tax policy, collection,
administrative and technical changes, corrections, and
clarifications; modifying collection of fees;
requiring studies; providing for appointments;
appropriating money; amending Minnesota Statutes 1994,
sections 10A.31, subdivision 3a; 13.99, subdivision
97a; 103E.611, subdivision 7; 115.26, by adding a
subdivision; 115A.919, by adding a subdivision;
115A.923, subdivision 1a; 165.08, subdivision 5;
239.761, subdivision 5; 270.067, subdivision 2;
270.07, subdivision 1; 270.102, subdivisions 1, 2, and
3; 270.70, subdivision 2; 270A.03, subdivision 2;
273.02, subdivision 3; 273.111, subdivision 3; 273.13,
subdivisions 22 and 23; 273.1398, subdivision 4, and
by adding a subdivision; 275.065, subdivision 5a;
275.07, subdivision 4; 275.61; 278.01, by adding a
subdivision; 278.08; 279.06, subdivision 1; 279.37, by
adding a subdivision; 281.17; 287.06; 289A.39,
subdivision 1; 289A.50, by adding a subdivision;
289A.56, subdivision 4; 290.01, subdivision 4a;
290.06, subdivisions 2c and 22; 290.091, subdivision
2; 290.0922, subdivisions 1 and 3; 290.095,
subdivision 3; 290.17, subdivision 2; 290A.25; 295.50,
subdivision 6; 295.51, subdivision 1, and by adding a
subdivision; 295.52, by adding a subdivision; 295.54,
subdivisions 1, 2, and by adding a subdivision;
296.01, subdivisions 2 and 13; 296.02, subdivision 8,
and by adding a subdivision; 296.025, subdivision 6;
296.141, subdivisions 4 and 5; 296.15, by adding a
subdivision; 296.17, subdivision 7; 297.04,
subdivision 9; 297A.14, by adding a subdivision;
297A.15, subdivisions 4, 5, and 6; 297A.21,
subdivision 4; 297A.211, subdivisions 1 and 3;
297A.24, subdivision 1; 297A.25, subdivisions 14, 28,
and 37; 297A.256, subdivision 1; 297A.2572; 297A.2573;
297A.44, subdivision 1; 297A.46; 297E.02, subdivisions
4 and 10; 298.01, subdivision 4e; 298.17; 298.28,
subdivisions 2 and 6; 298.296, subdivision 2; 298.75,
subdivision 1; 349.15, by adding a subdivision;
349.154, subdivision 2; 349.19, subdivision 2, and by
adding a subdivision; 375.192, subdivision 2; 383B.51;
428A.01, subdivisions 2 and 3; 428A.02, subdivision 1;
444.075, by adding a subdivision; 458A.32, subdivision
4; 469.040, by adding a subdivision; 469.167,
subdivision 2; 469.173, subdivision 7; 469.174,
subdivision 2; 469.176, subdivision 4f; 469.1761,
subdivision 1; 469.177, subdivision 3; 471.59, by
adding a subdivision; 471.88, subdivision 14; 473.39,
by adding a subdivision; 473.608, by adding a
subdivision; 473.625; 477A.011, subdivisions 3, 20,
27, 32, and 35; Minnesota Statutes 1995 Supplement,
sections 16A.152, subdivision 2; 16A.67, subdivision
5; 41A.09, subdivision 2a; 115B.48, by adding
subdivisions; 115B.49, subdivisions 2 and 4; 121.904,
subdivision 4a; 124A.03, subdivision 2; 216B.161,
subdivision 1; 270A.03, subdivision 7; 273.11,
subdivision 16; 273.124, subdivisions 1, 3, and 13;
273.13, subdivision 25; 273.1398, subdivision 1;
273.1399, subdivisions 6 and 7; 275.065, subdivisions
3 and 6; 275.08, subdivision 1b; 276.04, subdivision
2; 289A.02, subdivision 7; 289A.40, subdivision 1;
290.01, subdivisions 19 and 31; 290.191, subdivisions
5 and 6; 290A.04, subdivision 2h; 291.005, subdivision
1; 295.50, subdivisions 3 and 4; 295.53, subdivisions
1 and 5; 296.02, subdivision 1; 296.025, subdivision
1; 296.12, subdivision 3; 297A.02, subdivision 4;
297A.25, subdivisions 57, 59, and 61; 297A.45,
subdivisions 2, 3, and 4; 297B.01, subdivision 8;
298.227; 298.24, subdivision 1; 298.28, subdivision
9a; 298.296, subdivision 4; 428A.05; 465.82,
subdivision 2; 469.169, subdivisions 9 and 10;
469.174, subdivision 4; 469.175, subdivisions 1, 5,
and 6; 469.176, subdivisions 2 and 7; 471.6965;
473.39, subdivision 1b; 473.448; 477A.0121,
subdivision 4; 477A.0132; 477A.03, subdivision 2;
501B.38, subdivision 1a; Laws 1963, chapter 118,
sections 1, subdivision 3; 2; 4; and 6; Laws 1971,
chapter 869, section 2, subdivisions 2, as amended;
14; and 17, as added; section 3, subdivisions 5, 6,
and 9; section 4, subdivisions 1, 2, and 5, as
amended; section 5, subdivisions 1 and 3; section 8;
section 10, subdivision 3b, as added; section 12,
subdivisions 1, as amended; and 2, as amended; section
17, subdivision 11; section 19; section 20,
subdivision 2; section 21; and section 24; Laws 1985,
chapter 302, section 2, subdivision 1, as amended;
Laws 1989, chapter 211, section 4, subdivision 1; Laws
1991, chapter 291, article 8, section 27; and Laws
1995, chapter 264, article 2, sections 42, subdivision
1; and 44; and article 5, sections 40, subdivision 1;
44, subdivision 4; and 45, subdivision 1; proposing
coding for new law in Minnesota Statutes, chapters
103D; 115B; 276; 281; 287; 290A; 297A; 298; 315; 375;
428A; and 477A; proposing coding for new law as
Minnesota Statutes, chapter 276A; repealing Minnesota
Statutes 1994, sections 13.99, subdivision 97;
273.1398, subdivision 5b; 290.06, subdivision 21;
290.092; 295.37; 295.39; 295.40; 295.41; 295.42;
295.43; 295.50, subdivisions 8, 9, 9a, 11, 12, and
12a; 296.25, subdivision 1a; 297A.14, subdivision 3;
297A.24, subdivision 2; and 469.150; Laws 1971,
chapter 869, section 6, subdivision 3; and Laws 1987,
chapter 285.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
ARTICLE 1
INCOME AND FRANCHISE TAXES
Section 1. Minnesota Statutes 1994, section 10A.31,
subdivision 3a, is amended to read:
Subd. 3a. [QUALIFICATION OF POLITICAL PARTIES.] A major
political party as defined in section 10A.01, subdivision 12,
qualifies for inclusion on the income tax form and property tax
refund return as provided in subdivision 3, provided that it
qualifies as a major political party by July 1 of the taxable
year.
A minor political party as defined in section 10A.01,
subdivision 13 qualifies for inclusion on the income tax form
and property tax refund return as provided in subdivision 3,
provided that
(1) (a) if a petition is filed, it is filed by June 1 of
the taxable year; or
(b) if the party ran a candidate for statewide office, that
office must have been the office of governor and lieutenant
governor, secretary of state, state auditor, state treasurer, or
attorney general; and
(2) the secretary of state certifies to the commissioner of
revenue by July 1, 1984, and by July 1 of every odd-numbered
year thereafter the parties which qualify as minor political
parties under this subdivision.
A minor party shall be certified only if the secretary of
state determines that the party satisfies the following
conditions:
(a) the party meets the requirements of section 10A.01,
subdivision 13, and in the last applicable election ran a
candidate for the statewide offices listed in clause (1)(b) of
this subdivision;
(b) it is a political party, not a principal campaign
committee;
(c) it has held a state convention in the last two years,
adopted a state constitution, and elected state officers; and
(d) an officer of the party has filed with the secretary of
state a certification that the party held a state convention in
the last two years, adopted a state constitution, and elected
state officers.
Sec. 2. Minnesota Statutes 1994, section 165.08,
subdivision 5, is amended to read:
Subd. 5. [EXEMPTIONS.] Notwithstanding any other provision
of law to the contrary, the properties, moneys, and other assets
of any joint and independent international authority or
commission created under subdivision 1, all revenues or other
income of any such authority or commission, and all bonds,
certificates of indebtedness, or other obligations issued by any
such authority or commission, and the interest thereon, shall be
exempt from all taxation, licenses, fees, or charges of any kind
imposed by the state or by any county, municipality, political
subdivision, taxing district, or other public agency or body of
the state.
Sec. 3. Minnesota Statutes 1994, section 290.01,
subdivision 4a, is amended to read:
Subd. 4a. [FINANCIAL INSTITUTION.] (a) "Financial
institution" means:
(1) a holding company;
(2) any regulated financial corporation; or
(3) any other corporation organized under the laws of the
United States or organized under the laws of this state or any
other state or country that is carrying on the business of a
financial institution.
(b) "Holding company" means any corporation registered
under the Federal Bank Holding Company Act of 1956, as amended,
or registered as a savings and loan holding company under the
Federal National Housing Act, as amended.
(c) "Regulated financial corporation" means an institution,
the deposits or accounts of which are insured under the Federal
Deposit Insurance Act or by the Federal Savings and Loan
Insurance Corporation, any institution which is a member of a
Federal Home Loan Bank, any other bank or thrift institution
incorporated or organized under the laws of any state or any
foreign country which is engaged in the business of receiving
deposits, any corporation organized under the provisions of
United States Code, title 12, sections 611 to 631 (Edge Act
Corporations), and any agency of a foreign depository as defined
in United States Code, title 12, section 3101.
(d) "Business of a financial institution" means:
(1) the business that a regulated financial corporation may
be authorized to do under state or federal law or the business
that its subsidiary is authorized to do by the proper regulatory
authorities;
(2) the business that any corporation organized under the
authority of the United States or organized under the laws of
this state or any other state or country does or has authority
to do which is substantially similar to the business which a
corporation may be created to do under chapters 46 to 55 or any
business which a corporation or its subsidiary is authorized to
do by those laws; or
(3) (2) the business that any corporation organized under
the authority of the United States or organized under the laws
of this state or any other state or country does or has
authority to do if the corporation derives more than 50 percent
of its gross income from lending activities (including
discounting obligations) in substantial competition with the
businesses described in clauses clause (1) and (2). For
purposes of this clause, the computation of the gross income of
a corporation does not include income from nonrecurring,
extraordinary items.
Sec. 4. Minnesota Statutes 1994, section 290.06,
subdivision 2c, is amended to read:
Subd. 2c. [SCHEDULES OF RATES FOR INDIVIDUALS, ESTATES,
AND TRUSTS.] (a) The income taxes imposed by this chapter upon
married individuals filing joint returns and surviving spouses
as defined in section 2(a) of the Internal Revenue Code must be
computed by applying to their taxable net income the following
schedule of rates:
(1) On the first $19,910, 6 percent;
(2) On all over $19,910, but not over $79,120, 8 percent;
(3) On all over $79,120, 8.5 percent.
Married individuals filing separate returns, estates, and
trusts must compute their income tax by applying the above rates
to their taxable income, except that the income brackets will be
one-half of the above amounts.
(b) The income taxes imposed by this chapter upon unmarried
individuals must be computed by applying to taxable net income
the following schedule of rates:
(1) On the first $13,620, 6 percent;
(2) On all over $13,620, but not over $44,750, 8 percent;
(3) On all over $44,750, 8.5 percent.
(c) The income taxes imposed by this chapter upon unmarried
individuals qualifying as a head of household as defined in
section 2(b) of the Internal Revenue Code must be computed by
applying to taxable net income the following schedule of rates:
(1) On the first $16,770, 6 percent;
(2) On all over $16,770, but not over $67,390, 8 percent;
(3) On all over $67,390, 8.5 percent.
(d) In lieu of a tax computed according to the rates set
forth in this subdivision, the tax of any individual taxpayer
whose taxable net income for the taxable year is less than an
amount determined by the commissioner must be computed in
accordance with tables prepared and issued by the commissioner
of revenue based on income brackets of not more than $100. The
amount of tax for each bracket shall be computed at the rates
set forth in this subdivision, provided that the commissioner
may disregard a fractional part of a dollar unless it amounts to
50 cents or more, in which case it may be increased to $1.
(e) An individual who is not a Minnesota resident for the
entire year must compute the individual's Minnesota income tax
as provided in this subdivision. After the application of the
nonrefundable credits provided in this chapter, the tax
liability must then be multiplied by a fraction in which:
(1) The numerator is the individual's Minnesota source
federal adjusted gross income as defined in section 62 of the
Internal Revenue Code increased by the addition required for
interest income from non-Minnesota state and municipal bonds
under section 290.01, subdivision 19a, clause (1), after
applying the allocation and assignability provisions of section
290.081, clause (a), or 290.17; and
(2) the denominator is the individual's federal adjusted
gross income as defined in section 62 of the Internal Revenue
Code of 1986, as amended through April 15, 1995, increased by
the addition required for interest income from non-Minnesota
state and municipal bonds under section 290.01, subdivision 19a,
clause (1).
Sec. 5. Minnesota Statutes 1994, section 290.06,
subdivision 22, is amended to read:
Subd. 22. [CREDIT FOR TAXES PAID TO ANOTHER STATE.] (a) A
taxpayer who is liable for taxes on or measured by net income to
another state or province or territory of Canada, as provided in
paragraphs (b) through (f), upon income allocated or apportioned
to Minnesota, is entitled to a credit for the tax paid to
another state or province or territory of Canada if the tax is
actually paid in the taxable year or a subsequent taxable year.
A taxpayer who is a resident of this state pursuant to section
290.01, subdivision 7, clause (2), and who is subject to income
tax as a resident in the state of the individual's domicile is
not allowed this credit unless the state of domicile does not
allow a similar credit.
(b) For an individual, estate, or trust, the credit is
determined by multiplying the tax payable under this chapter by
the ratio derived by dividing the income subject to tax in the
other state or province or territory of Canada that is also
subject to tax in Minnesota while a resident of Minnesota by the
taxpayer's federal adjusted gross income, as defined in section
62 of the Internal Revenue Code, modified by the addition
required by section 290.01, subdivision 19a, clause (1), and the
subtraction allowed by section 290.01, subdivision 19b, clause
(1), to the extent the income is allocated or assigned to
Minnesota under sections 290.081 and 290.17.
(c) If the taxpayer is an athletic team that apportions all
of its income under section 290.17, subdivision 5, paragraph
(c), the credit is determined by multiplying the tax payable
under this chapter by the ratio derived from dividing the total
net income subject to tax in the other state or province or
territory of Canada by the taxpayer's Minnesota taxable income.
(d) The credit determined under paragraph (b) or (c) shall
not exceed the amount of tax so paid to the other state or
province or territory of Canada on the gross income earned
within the other state or province or territory of Canada
subject to tax under this chapter, nor shall the allowance of
the credit reduce the taxes paid under this chapter to an amount
less than what would be assessed if such income amount was
excluded from taxable net income.
(e) In the case of the tax assessed on a lump sum
distribution under section 290.032, the credit allowed under
paragraph (a) is the tax assessed by the other state or province
or territory of Canada on the lump sum distribution that is also
subject to tax under section 290.032, and shall not exceed the
tax assessed under section 290.032. To the extent the total
lump sum distribution defined in section 290.032, subdivision 1,
includes lump sum distributions received in prior years or is
all or in part an annuity contract, the reduction to the tax on
the lump sum distribution allowed under section 290.032,
subdivision 2, includes tax paid to another state that is
properly apportioned to that distribution.
(f) If a Minnesota resident reported an item of income to
Minnesota and is assessed tax in such other state or province or
territory of Canada on that same income after the Minnesota
statute of limitations has expired, the taxpayer shall receive a
credit for that year under paragraph (a), notwithstanding any
statute of limitations to the contrary. The claim for the
credit must be submitted within one year from the date the taxes
were paid to the other state or province or territory of
Canada. The taxpayer must submit sufficient proof to show
entitlement to a credit.
(g) For the purposes of this subdivision, a resident
shareholder of a corporation having a valid election in effect
under section 1362 of the Internal Revenue Code must be
considered to have paid a tax imposed on the shareholder in an
amount equal to the shareholder's pro rata share of any net
income tax paid by the S corporation to a another state that
does not measure the income of the shareholder of the S
corporation by reference to the income of the S corporation.
For the purposes of the preceding sentence, the term "net income
tax" means any tax imposed on or measured by a corporation's net
income.
(h) For the purposes of this subdivision, a resident member
of a limited liability company taxed as a partnership under the
Internal Revenue Code must be considered to have paid a tax
imposed on the member in an amount equal to the member's pro
rata share of any net income tax paid by the limited liability
company to a state that does not measure the income of the
member of the limited liability company by reference to the
income of the limited liability company. For purposes of the
preceding sentence, the term "net income" tax means any tax
imposed on or measured by a limited liability company's net
income.
Sec. 6. Minnesota Statutes 1994, 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
Minnesota charitable contribution deduction and the medical
expense deduction;
(3) for depletion allowances computed under section 613A(c)
of the Internal Revenue Code, with respect to each property (as
defined in section 614 of the Internal Revenue Code), to the
extent not included in federal alternative minimum taxable
income, the excess of the deduction for depletion allowable
under section 611 of the Internal Revenue Code for the taxable
year over the adjusted basis of the property at the end of the
taxable year (determined without regard to the depletion
deduction for the taxable year);
(4) to the extent not included in federal alternative
minimum taxable income, the amount of the tax preference for
intangible drilling cost under section 57(a)(2) of the Internal
Revenue Code determined without regard to subparagraph (E);
(5) 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 the amounts determined under the following
clauses (1) to (3):
(1) interest income as defined in section 290.01,
subdivision 19b, clause (1);
(2) an overpayment of state income tax as provided by
section 290.01, subdivision 19b, clause (2), to the extent
included in federal alternative minimum taxable income; and
(3) 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) "Investment interest" means investment interest as
defined in section 163(d)(3) of the Internal Revenue Code.
(c) "Tentative minimum tax" equals seven percent of
alternative minimum taxable income after subtracting the
exemption amount determined under subdivision 3.
(d) "Regular tax" means the tax that would be imposed under
this chapter (without regard to this section and section
290.032), reduced by the sum of the nonrefundable credits
allowed under this chapter.
(e) "Net minimum tax" means the minimum tax imposed by this
section.
(f) "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). When the
federal deduction for charitable contributions is limited under
section 170(b) of the Internal Revenue Code, the allowable
contributions in the year of contribution are deemed to be first
contributions to entities described in section 290.21,
subdivision 3, clauses (a) to (e).
Sec. 7. Minnesota Statutes 1994, section 290.0922,
subdivision 1, is amended to read:
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 289A.08, subdivision 3, other than a corporation having
a valid election in effect under section 1362 of the Internal
Revenue Code 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 $ 999,999 $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 for each
taxable year on a corporation required to file a return under
section 289A.12, subdivision 3, that has a valid election in
effect for the taxable year under section 1362 of the Internal
Revenue Code and on a partnership required to file a return
under section 289A.12, subdivision 3, 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 for the taxpayer due under section 289A.18,
subdivision 1. 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 $ 999,999 $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
Sec. 8. Minnesota Statutes 1994, section 290.17,
subdivision 2, is amended to read:
Subd. 2. [INCOME NOT DERIVED FROM CONDUCT OF A TRADE OR
BUSINESS.] The income of a taxpayer subject to the allocation
rules that is not derived from the conduct of a trade or
business must be assigned in accordance with paragraphs (a) to
(f):
(a)(1) Subject to paragraphs (a)(2) and (a)(3), income from
labor or personal or professional services is assigned to this
state if, and to the extent that, the labor or services are
performed within it; all other income from such sources is
treated as income from sources without this state.
Severance pay shall be considered income from labor or
personal or professional services.
(2) In the case of an individual who is a nonresident of
Minnesota and who is an athlete or entertainer, income from
compensation for labor or personal services performed within
this state shall be determined in the following manner:
(i) The amount of income to be assigned to Minnesota for an
individual who is a nonresident salaried athletic team employee
shall be determined by using a fraction in which the denominator
contains the total number of days in which the individual is
under a duty to perform for the employer, and the numerator is
the total number of those days spent in Minnesota; and
(ii) The amount of income to be assigned to Minnesota for
an individual who is a nonresident, and who is an athlete or
entertainer not listed in clause (i), for that person's athletic
or entertainment performance in Minnesota shall be determined by
assigning to this state all income from performances or athletic
contests in this state.
(3) For purposes of this section, amounts received by a
nonresident from the United States, its agencies or
instrumentalities, the Federal Reserve Bank, the state of
Minnesota or any of its political or governmental subdivisions,
or a Minnesota volunteer firefighters' relief association, by
way of payment as a pension, public employee retirement benefit,
or any combination of these, or as a retirement or survivor's
benefit made from a plan qualifying under section 401, 403, 408,
or 409, or as defined in section 403(b) or 457 of the Internal
Revenue Code, are not considered income derived from carrying on
a trade or business or from performing personal or professional
services in Minnesota, and are not taxable under this chapter.
(b) Income or gains from tangible property located in this
state that is not employed in the business of the recipient of
the income or gains must be assigned to this state.
(c) Income or gains from intangible personal property not
employed in the business of the recipient of the income or gains
must be assigned to this state if the recipient of the income or
gains is a resident of this state or is a resident trust or
estate.
Gain on the sale of a partnership interest is allocable to
this state in the ratio of the original cost of partnership
tangible property in this state to the original cost of
partnership tangible property everywhere, determined at the time
of the sale. If more than 50 percent of the value of the
partnership's assets consists of intangibles, gain or loss from
the sale of the partnership interest is allocated to this state
in accordance with the sales factor of the partnership for its
first full tax period immediately preceding the tax period of
the partnership during which the partnership interest was sold.
Gain on the sale of goodwill or income from a covenant not
to compete that is connected with a business operating all or
partially in Minnesota is allocated to this state to the extent
that the income from the business in the year preceding the year
of sale was assignable to Minnesota under subdivision 3.
When an employer pays an employee for a covenant not to
compete, the income allocated to this state is in the ratio of
the employee's service in Minnesota in the calendar year
preceding leaving the employment of the employer over the total
services performed by the employee for the employer in that year.
(d) Income from the operation of a farm shall be assigned
to this state if the farm is located within this state and to
other states only if the farm is not located in this state.
(e) Income from winnings on Minnesota pari-mutuel betting
tickets, the Minnesota state lottery, and lawful gambling as
defined in section 349.12, subdivision 24, conducted within the
boundaries of the state of Minnesota shall be assigned to this
state.
(f) All items of gross income not covered in paragraphs (a)
to (e) and not part of the taxpayer's income from a trade or
business shall be assigned to the taxpayer's domicile.
Sec. 9. Minnesota Statutes 1995 Supplement, section
290.191, subdivision 5, is amended to read:
Subd. 5. [DETERMINATION OF SALES FACTOR.] For purposes of
this section, the following rules apply in determining the sales
factor.
(a) The sales factor includes all sales, gross earnings, or
receipts received in the ordinary course of the business, except
that the following types of income are not included in the sales
factor:
(1) interest;
(2) dividends;
(3) sales of capital assets as defined in section 1221 of
the Internal Revenue Code;
(4) sales of property used in the trade or business, except
sales of leased property of a type which is regularly sold as
well as leased;
(5) sales of debt instruments as defined in section
1275(a)(1) of the Internal Revenue Code or sales of stock; and
(6) royalties, fees, or other like income of a type which
qualify for a subtraction from federal taxable income under
section 290.01, subdivision 19(d)(11).
(b) Sales of tangible personal property are made within
this state if the property is received by a purchaser at a point
within this state, and the taxpayer is taxable in this state,
regardless of the f.o.b. point, other conditions of the sale, or
the ultimate destination of the property.
(c) Tangible personal property delivered to a common or
contract carrier or foreign vessel for delivery to a purchaser
in another state or nation is a sale in that state or nation,
regardless of f.o.b. point or other conditions of the sale.
(d) Notwithstanding paragraphs (b) and (c), when
intoxicating liquor, wine, fermented malt beverages, cigarettes,
or tobacco products are sold to a purchaser who is licensed by a
state or political subdivision to resell this property only
within the state of ultimate destination, the sale is made in
that state.
(e) Sales made by or through a corporation that is
qualified as a domestic international sales corporation under
section 992 of the Internal Revenue Code are not considered to
have been made within this state.
(f) Sales, rents, royalties, and other income in connection
with real property is attributed to the state in which the
property is located.
(g) Receipts from the lease or rental of tangible personal
property, including finance leases and true leases, must be
attributed to this state if the property is located in this
state and to other states if the property is not located in this
state. Receipts from the lease or rental of moving property
including, but not limited to, motor vehicles, rolling stock,
aircraft, vessels, or mobile equipment is located in this state
if are included in the numerator of the receipts factor to the
extent that the property is used in this state. The extent of
the use of moving property is determined as follows:
(1) the operation of the property is entirely within this
state; or A motor vehicle is used wholly in the state in which
it is registered.
(2) the operation of the property is in two or more states
and the principal base of operations from which the property is
sent out is in this state. The extent that rolling stock is
used in this state is determined by multiplying the receipts
from the lease or rental of the rolling stock by a fraction, the
numerator of which is the miles traveled within this state by
the leased or rented rolling stock and the denominator of which
is the total miles traveled by the leased or rented rolling
stock.
(3) The extent that an aircraft is used in this state is
determined by multiplying the receipts from the lease or rental
of the aircraft by a fraction, the numerator of which is the
number of landings of the aircraft in this state and the
denominator of which is the total number of landings of the
aircraft.
(4) The extent that a vessel, mobile equipment, or other
mobile property is used in the state is determined by
multiplying the receipts from the lease or rental of the
property by a fraction, the numerator of which is the number of
days during the taxable year the property was in this state and
the denominator of which is the total days in the taxable year.
(h) Royalties and other income not described in paragraph
(a), clause (6), received for the use of or for the privilege of
using intangible property, including patents, know-how,
formulas, designs, processes, patterns, copyrights, trade names,
service names, franchises, licenses, contracts, customer lists,
or similar items, must be attributed to the state in which the
property is used by the purchaser. If the property is used in
more than one state, the royalties or other income must be
apportioned to this state pro rata according to the portion of
use in this state. If the portion of use in this state cannot
be determined, the royalties or other income must be excluded
from both the numerator and the denominator. Intangible
property is used in this state if the purchaser uses the
intangible property or the rights therein in the regular course
of its business operations in this state, regardless of the
location of the purchaser's customers.
(i) Sales of intangible property are made within the state
in which the property is used by the purchaser. If the property
is used in more than one state, the sales must be apportioned to
this state pro rata according to the portion of use in this
state. If the portion of use in this state cannot be
determined, the sale must be excluded from both the numerator
and the denominator of the sales factor. Intangible property is
used in this state if the purchaser used the intangible property
in the regular course of its business operations in this state.
(j) Receipts from the performance of services must be
attributed to the state where the services are received. For
the purposes of this section, receipts from the performance of
services provided to a corporation, partnership, or trust may
only be attributed to a state where it has a fixed place of
doing business. If the state where the services are received is
not readily determinable or is a state where the corporation,
partnership, or trust receiving the service does not have a
fixed place of doing business, the services shall be deemed to
be received at the location of the office of the customer from
which the services were ordered in the regular course of the
customer's trade or business. If the ordering office cannot be
determined, the services shall be deemed to be received at the
office of the customer to which the services are billed.
Sec. 10. Minnesota Statutes 1995 Supplement, section
290.191, subdivision 6, is amended to read:
Subd. 6. [DETERMINATION OF RECEIPTS FACTOR FOR FINANCIAL
INSTITUTIONS.] (a) For purposes of this section, the rules in
this subdivision and subdivision 8 apply in determining the
receipts factor for financial institutions.
(b) "Receipts" for this purpose means gross income,
including net taxable gain on disposition of assets, including
securities and money market instruments, when derived from
transactions and activities in the regular course of the
taxpayer's trade or business.
(c) "Money market instruments" means federal funds sold and
securities purchased under agreements to resell, commercial
paper, banker's acceptances, and purchased certificates of
deposit and similar instruments to the extent that the
instruments are reflected as assets under generally accepted
accounting principles.
(d) "Securities" means United States Treasury securities,
obligations of United States government agencies and
corporations, obligations of state and political subdivisions,
corporate stock, bonds, and other securities, participations in
securities backed by mortgages held by United States or state
government agencies, loan-backed securities and similar
investments to the extent the investments are reflected as
assets under generally accepted accounting principles.
(e) Receipts from the lease or rental of real or tangible
personal property, including both finance leases and true
leases, must be attributed to this state if the property is
located in this state. Receipts from the lease or rental of
tangible personal property that is characteristically moving
property, such as including, but not limited to, motor vehicles,
rolling stock, aircraft, vessels, or mobile equipment, and the
like, is considered to be located in a state if are included in
the numerator of the receipts factor to the extent that the
property is used in this state. The extent of the use of moving
property is determined as follows:
(1) the operation of the property is entirely within the
state; or A motor vehicle is used wholly in the state in which
it is registered.
(2) the operation of the property is in two or more states,
but the principal base of operations from which the property is
sent out is in the state. The extent that rolling stock is used
in this state is determined by multiplying the receipts from the
lease or rental of the rolling stock by a fraction, the
numerator of which is the miles traveled within this state by
the leased or rented rolling stock and the denominator of which
is the total miles traveled by the leased or rented rolling
stock.
(3) The extent that an aircraft is used in this state is
determined by multiplying the receipts from the lease or rental
of the aircraft by a fraction, the numerator of which is the
number of landings of the aircraft in this state and the
denominator of which is the total number of landings of the
aircraft.
(4) The extent that a vessel, mobile equipment, or other
mobile property is used in the state is determined by
multiplying the receipts from the lease or rental of property by
a fraction, the numerator of which is the number of days during
the taxable year the property was in this state and the
denominator of which is the total days in the taxable year.
(f) Interest income and other receipts from assets in the
nature of loans that are secured primarily by real estate or
tangible personal property must be attributed to this state if
the security property is located in this state under the
principles stated in paragraph (e).
(g) Interest income and other receipts from consumer loans
not secured by real or tangible personal property that are made
to residents of this state, whether at a place of business, by
traveling loan officer, by mail, by telephone or other
electronic means, must be attributed to this state.
(h) Interest income and other receipts from commercial
loans and installment obligations that are unsecured by real or
tangible personal property or secured by intangible property
must be attributed to this state if the proceeds of the loan are
to be applied in this state. If it cannot be determined where
the funds are to be applied, the income and receipts are
attributed to the state in which the office of the borrower from
which the application would be made in the regular course of
business is located. If this cannot be determined, the
transaction is disregarded in the apportionment formula.
(i) Interest income and other receipts from a participating
financial institution's portion of participation and syndication
loans must be attributed under paragraphs (e) to (h). A
participation loan is an arrangement in which a lender makes a
loan to a borrower and then sells, assigns, or otherwise
transfers all or a part of the loan to a purchasing financial
institution. A syndication loan is a loan transaction involving
multiple financial institutions in which all the lenders are
named as parties to the loan documentation, are known to the
borrower, and have privity of contract with the borrower.
(j) Interest income and other receipts including service
charges from financial institution credit card and travel and
entertainment credit card receivables and credit card holders'
fees must be attributed to the state to which the card charges
and fees are regularly billed.
(k) Merchant discount income derived from financial
institution credit card holder transactions with a merchant must
be attributed to the state in which the merchant is located. In
the case of merchants located within and outside the state, only
receipts from merchant discounts attributable to sales made from
locations within the state are attributed to this state. It is
presumed, subject to rebuttal, that the location of a merchant
is the address shown on the invoice submitted by the merchant to
the taxpayer.
(l) Receipts from the performance of fiduciary and other
services must be attributed to the state in which the services
are received. For the purposes of this section, services
provided to a corporation, partnership, or trust must be
attributed to a state where it has a fixed place of doing
business. If the state where the services are received is not
readily determinable or is a state where the corporation,
partnership, or trust does not have a fixed place of doing
business, the services shall be deemed to be received at the
location of the office of the customer from which the services
were ordered in the regular course of the customer's trade or
business. If the ordering office cannot be determined, the
services shall be deemed to be received at the office of the
customer to which the services are billed.
(m) Receipts from the issuance of travelers checks and
money orders must be attributed to the state in which the checks
and money orders are purchased.
(n) Receipts from investments of a financial institution in
securities and from money market instruments must be apportioned
to this state based on the ratio that total deposits from this
state, its residents, including any business with an office or
other place of business in this state, its political
subdivisions, agencies, and instrumentalities bear to the total
deposits from all states, their residents, their political
subdivisions, agencies, and instrumentalities. In the case of
an unregulated financial institution subject to this section,
these receipts are apportioned to this state based on the ratio
that its gross business income, excluding such receipts, earned
from sources within this state bears to gross business income,
excluding such receipts, earned from sources within all states.
For purposes of this subdivision, deposits made by this state,
its residents, its political subdivisions, agencies, and
instrumentalities must be attributed to this state, whether or
not the deposits are accepted or maintained by the taxpayer at
locations within this state.
(o) A financial institution's interest in property
described in section 290.015, subdivision 3, paragraph (b), is
included in the receipts factor in the same manner as assets in
the nature of securities or money market instruments are
included in paragraph (n).
Sec. 11. Minnesota Statutes 1994, section 383B.51, is
amended to read:
383B.51 [NO ASSIGNMENT OR GARNISHMENT.]
The right of a participant who has shares to the credit of
the participant's share account record to redeem all or any
portion of the shares is a personal right only and shall be in
the state of Minnesota or the state board of investment or the
nominee of either, subject to the rights of the county of
Hennepin. Any assignment or attempted assignment of shares to
the credit of a participant's share account record by any person
is null and void. The shares are exempt from garnishment or
levy under attachment or execution or other legal process,
except as provided in section 518.58, 518.581, or 518.611. The
shares are also exempt from all taxation, except individual
income taxation, by the state of Minnesota.
Sec. 12. Minnesota Statutes 1994, section 458A.32,
subdivision 4, is amended to read:
Subd. 4. Revenue bonds of the authority shall be deemed
and treated as instrumentalities of a public government agency;
and as such, together with interest thereon, exempt from
taxation.
Sec. 13. [EFFECTIVE DATE.]
Sections 1, 4, 6, and 8 are effective for tax years
beginning after December 31, 1995.
Sections 2 and 12 are effective for income earned after
July 1, 1983, in taxable years beginning after December 31, 1982.
Sections 9 and 10 are effective for taxable years beginning
after December 31, 1997.
Section 11 is a clarification of the law and is effective
the day following final enactment.
ARTICLE 2
SALES AND SPECIAL TAXES
Section 1. Minnesota Statutes 1995 Supplement, section
115B.48, is amended by adding a subdivision to read:
Subd. 7. [FACILITY.] "Facility" means one or more
buildings or parts of a building and the equipment,
installations, and structures contained in the building, located
on a single site or on contiguous or adjacent sites. Facility
includes any site or area where a hazardous substance, or a
pollutant or contaminant, has been deposited, stored, disposed
of, or placed, or otherwise comes to be located.
Sec. 2. Minnesota Statutes 1995 Supplement, section
115B.48, is amended by adding a subdivision to read:
Subd. 8. [FULL-TIME EQUIVALENCE.] "Full-time equivalence"
means 2,000 hours worked by employees, owners, and others, at
duties related to the drycleaning operation in a drycleaning
facility during a 12-month period beginning July 1 of the
preceding year and running through June 30 of the year in which
the annual registration fee is due. For those drycleaning
facilities that were in business less than the 12-month period,
full-time equivalence means the total of all of the hours worked
at duties related to the drycleaning operation in the
drycleaning facility, divided by 2,000 and multiplied by a
fraction, the numerator of which is 50 and the denominator of
which is the number of weeks in business during the reporting
period.
Sec. 3. Minnesota Statutes 1995 Supplement, section
115B.49, subdivision 2, is amended to read:
Subd. 2. [REVENUE SOURCES.] Revenue from the following
sources must be deposited in the state treasury and credited to
the account:
(1) the proceeds of the fees imposed by subdivision 4;
(2) interest attributable to investment of money in the
account;
(3) penalties and interest collected under subdivision 4,
paragraphs (e) and (f) paragraph (d); and
(4) money received by the commissioner for deposit in the
account in the form of gifts, grants, and appropriations.
Sec. 4. Minnesota Statutes 1995 Supplement, section
115B.49, subdivision 4, is amended to read:
Subd. 4. [REGISTRATION; FEES.] (a) The owner or operator
of a drycleaning facility shall register on or before July 1 of
each year with the commissioner of revenue in a manner
prescribed by the commissioner of revenue and pay a registration
fee for the facility. The amount of the fee is:
(1) $500, for facilities with up to four full-time
equivalent employees a full-time equivalence of fewer than five;
(2) $1,000, for facilities with a full-time equivalence of
five to ten full-time equivalent employees; and
(3) $1,500, for facilities with a full-time equivalence of
more than ten full-time equivalent employees.
(b) A person who sells drycleaning solvents for use by
drycleaning facilities in the state shall collect and remit to
the commissioner of revenue in a manner prescribed by the
commissioner of revenue, on or before the 20th day of the month
following the month in which the sales of drycleaning solvents
are made, a fee of:
(1) $3.50 for each gallon of perchloroethylene sold for use
by drycleaning facilities in the state; and
(2) 70 cents for each gallon of hydrocarbon-based
drycleaning solvent sold for use by drycleaning facilities in
the state.
(c) The commissioner of revenue shall provide each person
who pays a registration fee under paragraph (a) with a receipt.
The receipt or a copy of the receipt must be produced for
inspection at the request of any authorized representative of
the commissioner of revenue.
(d) The commissioner shall, after a public hearing but
notwithstanding section 16A.1285, subdivision 4, annually adjust
the fees in this subdivision as necessary to maintain an
unencumbered balance in the account of at least $1,000,000. Any
adjustment under this paragraph must be prorated among all the
fees in this subdivision. Fees adjusted under this paragraph
may not exceed 200 percent of the fees in this subdivision. The
commissioner shall notify the commissioner of revenue of an
adjustment under this paragraph no later than March 1 of the
year in which the adjustment is to become effective. The
adjustment is effective for sales of drycleaning solvents made,
and annual registration fees due, beginning on July 1 of the
same year.
(e) An owner of a drycleaning facility who fails to pay a
fee under paragraph (a) when due is subject to a penalty of $50
per facility for each day the fee is not paid.
(f) (d) To enforce this subdivision, the commissioner of
revenue may examine documents, assess and collect fees, conduct
investigations, issue subpoenas, grant extensions to file
returns and pay fees, impose sales and use tax penalties and
interest on the annual registration fee under paragraph (a) and
the monthly fee under paragraph (b), abate penalties and
interest, and administer appeals, in the manner provided in
chapters 270 and 289A. The penalties and interest imposed on
taxes under chapter 297A apply to the fees imposed under this
subdivision. Disclosure of data collected by the commissioner
of revenue under this subdivision is governed by chapter 270B.
Sec. 5. [115B.491] [DRYCLEANING FACILITY USE FEE;
FACILITIES TO FILE RETURN.]
Subdivision 1. [USE FEE.] A drycleaning facility that
purchases drycleaning solvents for use in Minnesota without
paying the seller of drycleaning solvents the fee under section
115B.49, subdivision 4, paragraph (b), is subject to an
equivalent fee. Liability for the fee is incurred when
drycleaning solvents are received in Minnesota by the
drycleaning facility.
Subd. 2. [RETURN REQUIRED.] On or before the 20th of each
calendar month, every drycleaning facility that has purchased
drycleaning solvents for use in this state during the preceding
calendar month, upon which the fee imposed by section 115B.49,
subdivision 4, paragraph (b), has not been paid to the seller of
the drycleaning solvents, shall file a return with the
commissioner of revenue showing the quantity of solvents
purchased and a computation of the fee under section 115B.49,
subdivision 4, paragraph (d). The fee must accompany the
return. The return must be made upon a form furnished and
prescribed by the commissioner of revenue and must contain such
other information as the commissioner of revenue may require.
Subd. 3. [APPLICABILITY.] All of the provisions of section
115B.49, subdivision 4, paragraph (d), apply to this section.
Sec. 6. [115B.492] [ALLOCATION OF PAYMENT.]
In the discretion of the commissioner of revenue, payments
received for fees may be credited first to the oldest liability
not secured by a judgment or lien. For liabilities to which
payments are applied, the commissioner of revenue may credit
payments first to penalties, next to interest, and then to the
fee due.
Sec. 7. Minnesota Statutes 1995 Supplement, section
289A.40, subdivision 1, is amended to read:
Subdivision 1. [TIME LIMIT; GENERALLY.] Unless otherwise
provided in this chapter, a claim for a refund of an overpayment
of state tax must be filed within 3-1/2 years from the date
prescribed for filing the return, plus any extension of time
granted for filing the return, but only if filed within the
extended time, or one year from the date of an order assessing
tax under section 289A.37, subdivision 1, upon payment in full
of the tax, penalties, and interest shown on the order,
whichever period expires later. Claims for refund, except for
taxes under chapter 297A, filed after the 3-1/2 year period but
within the one-year period are limited to the amount of the tax,
penalties, and interest on the order and to issues determined by
the order.
In the case of assessments under section 289A.38,
subdivisions 5 or 6, claims for refund under chapter 297A filed
after the 3-1/2 year period but within the one-year period are
limited to the amount of the tax, penalties, and interest on the
order that are due for the period before the 3-1/2 year period.
Sec. 8. Minnesota Statutes 1994, section 289A.50, is
amended by adding a subdivision to read:
Subd. 2a. [REFUND OF SALES TAX TO PURCHASERS.] If a vendor
has collected from a purchaser a tax on a transaction that is
not subject to the tax imposed by chapter 297A, the purchaser
may apply directly to the commissioner for a refund under this
section if:
(a) the purchaser is currently registered to collect and
remit the sales and use tax; and
(b) the amount of the refund applied for exceeds $500.
The purchaser may not file more than two applications for
refund under this subdivision in a calendar year.
Sec. 9. Minnesota Statutes 1994, section 289A.56,
subdivision 4, is amended to read:
Subd. 4. [CAPITAL EQUIPMENT REFUNDS; REFUNDS TO
PURCHASERS.] Notwithstanding subdivision 3, for refunds payable
under section sections 297A.15, subdivision 5, and 289A.50,
subdivision 2a, interest is computed from the date the refund
claim is filed with the commissioner.
Sec. 10. Minnesota Statutes 1994, section 297.04,
subdivision 9, is amended to read:
Subd. 9. [APPLICATION DENIAL; LICENSE SUSPENSION AND
REVOCATION.] (a) The commissioner may revoke, cancel, or suspend
the license or licenses of any distributor or subjobber for
violation of sections 297.01 to 297.13, or any other act
applicable to the sale of cigarettes, or any rule promulgated by
the commissioner, and may also revoke any such license or
licenses of any distributor or subjobber for the violation of
sections 297.31 to 297.39, or any other act applicable to the
sale of tobacco products, or any rule promulgated by the
commissioner in furtherance of sections 297.31 to 297.39. The
commissioner may revoke, cancel, or suspend the license or
licenses of any distributor or subjobber for violation of
sections 325D.31 to 325D.42.
(b) The department must not issue or renew a license under
this chapter, and may revoke a license under this chapter, if
the applicant or licensee:
(1) owes $500 or more in delinquent taxes as defined in
section 270.72;
(2) after demand, has not filed tax returns required by the
commissioner of revenue;
(3) had a cigarette or tobacco license revoked by the
commissioner of revenue within the past two years;
(4) had a sales and use tax permit revoked by the
commissioner of revenue within the past two years; or
(5) has been convicted of a crime involving cigarettes,
including but not limited to: selling stolen cigarettes or
tobacco items, receiving stolen cigarettes or tobacco items, or
involvement in the smuggling of cigarettes or tobacco items.
(c) No license shall be revoked, canceled, or suspended
under this chapter, and no application for a license shall be
denied under this chapter, except after 20 days' notice and
specifying the commissioner's allegations against the licensee
or applicant, and the right to request, in writing within 20
days, a contested case hearing by the commissioner as provided
in section 297.09 chapter 14. If a written request for a
hearing is received by the department of revenue within 20 days
of the date of the initial notice, the hearing must be held
within 45 days after referral to the office of administrative
hearings, and no earlier than 20 days after notice to the
licensee or applicant of the hearing time and place. A license
is revoked or suspended, and an application is denied, when the
commissioner serves notice of revocation, suspension, or denial
after 20 days have passed following the initial notice under
this paragraph without a request for hearing being made, or if a
hearing is held, after the commissioner serves an order of
revocation, suspension, or denial under section 14.62,
subdivision 1. All notices under this paragraph may be served
personally or by mail.
Sec. 11. Minnesota Statutes 1995 Supplement, section
297A.02, subdivision 4, is amended to read:
Subd. 4. [MANUFACTURED HOUSING AND PARK TRAILERS.]
Notwithstanding the provisions of subdivision 1, for sales at
retail of new manufactured homes used for residential purposes
and new or used park trailers, as defined in section 168.011,
subdivision 8, paragraph (b), the excise tax is imposed upon 65
percent of the sales price of the home or park trailer.
Sec. 12. [297A.023] [REMITTANCE OF AMOUNTS COLLECTED AS
TAXES.]
Any amounts collected, even if erroneously or illegally
collected, from a purchaser under a representation that they are
taxes imposed under this chapter are state funds from the time
of collection and must be reported on a return filed with the
commissioner and are not subject to refund without proof that
such amounts have been refunded or credited to the purchaser by
the seller.
Sec. 13. Minnesota Statutes 1994, section 297A.14, is
amended by adding a subdivision to read:
Subd. 4. [DE MINIMIS EXEMPTION.] Purchases subject to use
tax under this section are exempt if (1) the purchase is made by
an individual for personal use, and (2) the total purchases that
are subject to the use tax do not exceed $770 in the calendar
year. For purposes of this subdivision, "personal use" includes
purchases for gifts. If an individual makes purchases, which
are subject to use tax, of more than $770 in the calendar year
the individual must pay the use tax on the entire amount.
Sec. 14. Minnesota Statutes 1994, section 297A.15,
subdivision 4, is amended to read:
Subd. 4. [SEIZURE; COURT REVIEW.] The commissioner of
revenue or the commissioner's duly authorized agents are
empowered to seize and confiscate in the name of the state any
truck, automobile or means of transportation not owned or
operated by a common carrier, used in the illegal importation
and transportation of any article or articles of tangible
personal property by a retailer or the retailer's agent or
employee who does not have a sales or use tax permit and has
been engaging in transporting personal property into the state
without payment of the tax. The commissioner may demand the
forfeiture and sale of the truck, automobile or other means of
transportation together with the property being transported
illegally, unless the owner establishes to the satisfaction of
the commissioner or the court that the owner had no notice or
knowledge or reason to believe that the vehicle was used or
intended to be used in any such violation. Within two days
after the seizure, the person making the seizure shall deliver
an inventory of the vehicle and property seized to the person
from whom the seizure was made, if known, and to any person
known or believed to have any right, title, interest or lien on
the vehicle or property, and shall also file a copy with the
commissioner. Within ten days after the date of service of the
inventory, the person from whom the vehicle and property was
seized or any person claiming an interest in the vehicle or
property may file with the commissioner a demand for a judicial
determination of the question as to whether the vehicle or
property was lawfully subject to seizure and forfeiture. The
commissioner, within 30 days, shall institute an action in the
district court of the county where the seizure was made to
determine the issue of forfeiture. The action shall be brought
in the name of the state and shall be prosecuted by the county
attorney or by the attorney general. The court shall hear the
action without a jury and shall try and determine the issues of
fact and law involved. Whenever a judgment of forfeiture is
entered, the commissioner may, unless the judgment is stayed
pending an appeal, cause the forfeited vehicle and property to
be sold at public auction as provided by law. If a demand for
judicial determination is made and no action is commenced as
provided in this subdivision, the vehicle and property shall be
released by the commissioner and redelivered to the person
entitled to it. If no demand is made, the vehicle and property
seized shall be deemed forfeited to the state by operation of
law and may be disposed of by the commissioner as provided where
there has been a judgment of forfeiture. The forfeiture and
sale of the automobile, truck or other means of transportation,
and of the property being transported illegally in it, is a
penalty for the violation of this chapter. After deducting the
expense of keeping the vehicle and property, the fee for
seizure, and the costs of the sale, the commissioner shall pay
from the funds collected all liens according to their priority,
which are established at the hearing as being bona fide and as
existing without the lienor having any notice or knowledge that
the vehicle or property was being used or was intended to be
used for or in connection with any such violation as specified
in the order of the court, and shall pay the balance of the
proceeds into the state treasury to be credited to the general
fund. The state shall not be liable for any liens in excess of
the proceeds from the sale after deductions provided. Any sale
under the provisions of this section shall operate to free the
vehicle and property sold from any and all liens on it, and
appeal from the order of the district court will lie as in other
civil cases.
For the purposes of this section, "common carrier" means
any person engaged in transportation for hire of tangible
personal property by motor vehicle, limited to (1) a person
possessing a certificate or permit authorizing or having
completed a registration process that authorizes for-hire
transportation of property from the interstate commerce
commission or the public utilities commission United States
Department of Transportation, the transportation regulation
board, or the department of transportation; or (2) any person
transporting commodities defined as "exempt" in for-hire
transportation; or (3) any person who pursuant to a contract
with a person described in (1) or (2) above transports tangible
personal property.
Sec. 15. Minnesota Statutes 1994, section 297A.211,
subdivision 1, is amended to read:
Subdivision 1. Every person, as defined in this chapter,
who is engaged in interstate for-hire transportation of tangible
personal property or passengers by motor vehicle may at their
option, under rules prescribed by the commissioner, register as
retailers and pay the taxes imposed by this chapter in
accordance with this section. Persons referred to herein are:
(1) persons possessing a certificate or permit authorizing or
having completed a registration process that authorizes for-hire
transportation of property or passengers from the interstate
commerce commission or the Minnesota public utilities commission
United States Department of Transportation, the transportation
regulation board, or the department of transportation; or (2)
persons transporting commodities defined as "exempt" in for-hire
transportation in interstate commerce; or (3) persons who,
pursuant to contracts with persons described in clauses (1) or
(2) above, transport tangible personal property in interstate
commerce. Persons qualifying under clauses (2) and (3) must
maintain on a current basis the same type of mileage records
that are required by persons specified in clause (1) by
the interstate commerce commission United States Department of
Transportation. Persons who in the course of their business are
transporting solely their own goods in interstate commerce may
also register as retailers pursuant to rules prescribed by the
commissioner and pay the taxes imposed by this chapter in
accordance with this section.
Sec. 16. Minnesota Statutes 1994, section 297A.25,
subdivision 14, is amended to read:
Subd. 14. [AIRFLIGHT EQUIPMENT.] The gross receipts from
sales of airflight equipment to, and the storage, use or other
consumption of such property by airline companies taxed under
the provisions of sections 270.071 to 270.079, as defined in
section 270.071, subdivision 4, are exempt. For purposes of
this subdivision, "airflight equipment" includes airplanes and
parts necessary for the repair and maintenance of such airflight
equipment, and flight simulators, but does not include airplanes
with a gross weight of less than 30,000 pounds that are used on
intermittent or irregularly timed flights.
Sec. 17. Minnesota Statutes 1994, section 297A.25,
subdivision 28, is amended to read:
Subd. 28. [WASTE PROCESSING EQUIPMENT.] The gross receipts
from the sale of equipment used for processing solid or
hazardous waste at a resource recovery facility, as defined in
section 115A.03, subdivision 28, are exempt, including pollution
control equipment at a resource recovery facility that burns
refuse-derived fuel or mixed municipal solid waste as its
primary fuel.
Sec. 18. Minnesota Statutes 1994, section 297A.25,
subdivision 37, is amended to read:
Subd. 37. [YMCA AND, YWCA, AND JCC MEMBERSHIPS.] The gross
receipts from the sale of memberships, including both one-time
initiation fees and periodic membership dues, to an association
incorporated under section 315.44 or an organization defined
under section 315.51, are exempt. However, all separate charges
made for the privilege of having access to and the use of the
association's sports and athletic facilities are taxable.
Sec. 19. Minnesota Statutes 1995 Supplement, section
297A.25, subdivision 57, is amended to read:
Subd. 57. [HORSES; RELATED MATERIALS.] (a) The gross
receipts from the sale of horses, including racehorses, and
all are exempt.
(b) Sales to persons who raise or board horses, of all
materials, including feed and bedding, used or consumed in the
breeding, raising, owning, boarding, and keeping of horses, are
exempt. Machinery, equipment, implements, tools, appliances,
furniture, and fixtures, used in the breeding, raising, owning,
boarding, and keeping of horses, are not included within this
exemption.
Sec. 20. Minnesota Statutes 1995 Supplement, section
297A.25, subdivision 59, is amended to read:
Subd. 59. [FARM MACHINERY.] From July 1, 1994, until June
30, 1996 1997, the gross receipts from the sale of used farm
machinery are exempt.
Sec. 21. Minnesota Statutes 1995 Supplement, section
297A.25, subdivision 61, is amended to read:
Subd. 61. [CONSTRUCTION MATERIALS FOR INDOOR ICE ARENAS.]
The gross receipts from the sale of construction materials and
supplies are exempt if:
(1) the materials and supplies are to be used in
constructing an indoor ice arena intended to be used
predominantly for youth athletic activities; and
(2) a school district is a party to a joint powers
agreement that governs the ownership, operation, and maintenance
of the facility the construction project is financed in whole or
in part from a grant under sections 240A.09 and 240A.10 or the
proceeds of obligations issued under section 373.43 or 475.58,
subdivision 3.
This exemption applies regardless of whether the purchases
are made by the owner of the facility or a contractor.
Sec. 22. Minnesota Statutes 1994, section 297A.256,
subdivision 1, is amended to read:
Subdivision 1. [FUNDRAISING SALES BY NONPROFIT GROUPS.]
Notwithstanding the provisions of this chapter, the following
sales made by a "nonprofit organization" are exempt from the
sales and use tax.
(a)(1) All sales made by an organization for fundraising
purposes if that organization exists solely for the purpose of
providing educational or social activities for young people
primarily age 18 and under. This exemption shall apply only if
the gross annual sales receipts of the organization from
fundraising do not exceed $10,000.
(2) A club, association, or other organization of
elementary or secondary school students organized for the
purpose of carrying on sports, educational, or other
extracurricular activities is a separate organization from the
school district or school for purposes of applying the $10,000
limit. This paragraph does not apply if the sales are derived
from admission charges or from activities for which the money
must be deposited with the school district treasurer under
section 123.38, subdivision 2, or be recorded in the same manner
as other revenues or expenditures of the school district under
section 123.38, subdivision 2b.
(b) All sales made by an organization for fundraising
purposes if that organization is a senior citizen group or
association of groups that in general limits membership to
persons age 55 or older and is organized and operated
exclusively for pleasure, recreation and other nonprofit
purposes and no part of the net earnings inure to the benefit of
any private shareholders. This exemption shall apply only if
the gross annual sales receipts of the organization from
fundraising do not exceed $10,000.
(c) The gross receipts from the sales of tangible personal
property at, admission charges for, and sales of food, meals, or
drinks at fundraising events sponsored by a nonprofit
organization when the entire proceeds, except for the necessary
expenses therewith, will be used solely and exclusively for
charitable, religious, or educational purposes. This exemption
does not apply to admission charges for events involving bingo
or other gambling activities or to charges for use of amusement
devices involving bingo or other gambling activities. For
purposes of this clause paragraph, a "nonprofit organization"
means any unit of government, corporation, society, association,
foundation, or institution organized and operated for
charitable, religious, educational, civic, fraternal, senior
citizens' or veterans' purposes, no part of the net earnings of
which enures to the benefit of a private individual.
If the profits are not used solely and exclusively for
charitable, religious, or educational purposes, the entire gross
receipts are subject to tax.
Each nonprofit organization shall keep a separate
accounting record, including receipts and disbursements from
each fundraising event. All deductions from gross receipts must
be documented with receipts and other records. If records are
not maintained as required, the entire gross receipts are
subject to tax.
The exemption provided by this section paragraph does not
apply to any sale made by or in the name of a nonprofit
corporation as the active or passive agent of a person that is
not a nonprofit corporation.
The exemption for fundraising events under this section
paragraph is limited to no more than 24 days a year.
Fundraising events conducted on premises leased or occupied for
more than four days but less than 30 days do not qualify for
this exemption.
(d) The gross receipts from the sale or use of tickets or
admissions to a golf tournament held in Minnesota are exempt if
the beneficiary of the tournament's net proceeds qualifies as a
tax-exempt organization under section 501(c)(3) of the Internal
Revenue Code, including a tournament conducted on premises
leased or occupied for more than four days.
Sec. 23. Minnesota Statutes 1995 Supplement, section
297B.01, subdivision 8, is amended to read:
Subd. 8. [PURCHASE PRICE.] "Purchase price" means the
total consideration valued in money for a sale, whether paid in
money or otherwise. The purchase price excludes the amount of a
manufacturer's rebate paid or payable to the purchaser. If a
motor vehicle is taken in trade as a credit or as part payment
on a motor vehicle taxable under this chapter, the credit or
trade-in value allowed by the person selling the motor vehicle
shall be deducted from the total selling price to establish the
purchase price of the vehicle being sold and the trade-in
allowance allowed by the seller shall constitute the purchase
price of the motor vehicle accepted as a trade-in. The purchase
price in those instances where the motor vehicle is acquired by
gift or by any other transfer for a nominal or no monetary
consideration shall also include the average value of similar
motor vehicles, established by standards and guides as
determined by the motor vehicle registrar. The purchase price
in those instances where a motor vehicle is manufactured by a
person who registers it under the laws of this state shall mean
the manufactured cost of such motor vehicle and manufactured
cost shall mean the amount expended for materials, labor and
other properly allocable costs of manufacture, except that in
the absence of actual expenditures for the manufacture of a part
or all of the motor vehicle, manufactured costs shall mean the
reasonable value of the completed motor vehicle.
The term "purchase price" shall not include the portion of
the value of a motor vehicle due solely to modifications
necessary to make the motor vehicle handicapped accessible. The
term "purchase price" shall not include the transfer of a motor
vehicle by way of gift between a husband and wife or parent and
child, nor shall it include the transfer of a motor vehicle by a
guardian to a ward when there is no monetary consideration and
the title to such vehicle was registered in the name of the
guardian, as guardian, only because the ward was a minor. There
shall not be included in "purchase price" the amount of any tax
imposed by the United States upon or with respect to retail
sales whether imposed upon the retailer or the consumer.
The term "purchase price" shall not include the transfer of
a motor vehicle as a gift between a foster parent and foster
child. For purposes of this subdivision, a foster relationship
exists, regardless of the age of the child, if (1) a foster
parent's home is or was licensed as a foster family home under
Minnesota Rules, parts 9545.0010 to 9545.0260, and (2) the
county verifies that the child was a state ward or in permanent
foster care.
Sec. 24. [315.51] [JCC; DEFINITION.]
A "JCC" means a nonprofit religious organization under
section 501(c)(3) of the Internal Revenue Code of 1986 known as
the Jewish Community Center of Greater Minneapolis or the Jewish
Community Center of Greater St. Paul and organized for the
purpose of serving the cultural, educational, and recreational
needs of the Jewish community.
Sec. 25. Laws 1991, chapter 291, article 8, section 27, is
amended by adding a subdivision to read:
Subd. 9. [ADDITIONAL AUTHORITY; MANKATO MUNICIPAL
AIRPORT.] (a) In addition to the uses of revenues authorized in
subdivision 3, the city may use revenues received from taxes
authorized by subdivisions 1 and 2 to pay for rehabilitation,
expansion, improvement, and operation of the Mankato municipal
airport and related facilities, including securing or paying
debt service on bonds or other obligations issued to finance the
improvements.
(b) The city may issue general obligation bonds of the city
for the Mankato municipal airport and related facilities without
election under Minnesota Statutes, chapter 475, on the question
of issuance of the bonds or a tax to pay them. The debt
represented by bonds issued for the Mankato municipal airport
and related facilities shall not be included in computing any
levy or debt limits applicable to the city.
(c) The total capital, administrative, and operating
expenses authorized in paragraph (a) payable from bond proceeds
and from the taxes authorized in subdivisions 1 and 2, excluding
investment earnings on bond proceeds and revenues, shall not
exceed $500,000 in any year, unless the city has dedicated in a
reserve fund sufficient funds to pay or secure payment of
principal and interest on bonds issued under subdivision 5 for a
period of at least one year. The total amount of general
obligation bonds of the city issued for the Mankato municipal
airport and related facilities may not exceed $4,500,000.
(d) Notwithstanding the provisions of subdivision 4, the
authority of the city to impose taxes under subdivisions 1 and 2
shall not expire until the principal and interest on any bonds
or obligations issued to finance the Mankato municipal airport
and related facilities have been paid, or the city determines by
ordinance an earlier expiration date.
(e) This subdivision is effective the day after compliance
with Minnesota Statutes, section 645.021, subdivision 3, by the
governing body of the city of Mankato.
Sec. 26. Laws 1995, chapter 264, article 2, section 42,
subdivision 1, is amended to read:
Subdivision 1. [CREATION; MEMBERSHIP.] (a) A state
advisory council is established to study the general and motor
vehicle sales and use taxes under Minnesota Statutes 1994,
chapters 297A and 297B, and to make recommendations to the 1996
legislature and the 1997 legislature. The study shall be
completed and Interim findings shall be reported to the
legislature by February 1, 1996. The study shall be completed
and a final report submitted to the legislature by January 1,
1997.
(b) The advisory council consists of 17 members who serve
at the pleasure of the appointing authority as follows:
(1) ten legislators; five members of the senate, including
two members of the minority party, appointed by the subcommittee
on committees of the committee on rules and administration and
five members of the house of representatives, including two
members of the minority party, appointed by the speaker;
(2) the commissioner of revenue or the commissioner's
designee; and
(3) six members of the public; two appointed by the
subcommittee on committees of the committee on rules and
administration of the senate, two appointed by the speaker of
the house, and two appointed by the governor. At least one
member of the public that is appointed by each entity must
represent a consumer interest group or other private citizen
group, public policy organization, or university department of
public policy or economics.
Sec. 27. Laws 1995, chapter 264, article 2, section 44, is
amended to read:
Sec. 44. [EFFECTIVE DATE.]
Section 1 is effective the day following final enactment.
Sections 3 and 4 are effective June 1, 1995. Section 4 is
repealed June 1, 2000.
Sections 5 to 21 and 43, paragraph (a), are effective July
1, 1995.
Sections 23, 28, 33, 40, 42, and the part of section 22
amending language in paragraph (i), clause (vii), are effective
the day following final enactment.
Sections 24 and 34 are effective for sales made after
December 31, 1996.
Section 25 is effective beginning with leases or rentals
made after June 30, 1995.
Section 26 is effective retroactively for sales after May
31, 1992.
Section 27 is effective for sales made after June 30, 1995.
Section 29 and the part of section 22 striking the language
after paragraph (h) are effective for sales after June 30, 1995.
Section 32 is effective for sales made after June 30, 1995,
and before July 1, 1996 1998.
Sections 35 and 36 are effective for sales or transfers
made after June 30, 1995.
Section 38 is effective the day after the governing body of
the city of Winona complies with Minnesota Statutes, section
645.021, subdivision 3.
Section 39 is effective upon compliance by the Minneapolis
city council with Minnesota Statutes, section 645.021,
subdivision 3.
Section 43, paragraph (b), is effective for sales of 900
information services made after June 30, 1995.
Sec. 28. [SOLID WASTE MANAGEMENT TAXES.]
Subdivision 1. [MORATORIUM EXTENDED.] The commissioner of
revenue shall not initiate or continue any action to collect any
underpayment from political subdivisions, or to reimburse any
overpayment to any political subdivisions of taxes on solid
waste management services under Minnesota Statutes, section
297A.45, until June 1, 1997. The statute of limitations for
assessing, collecting, or refunding taxes subject to the
provisions of this subdivision and Laws 1995, chapter 264,
article 2, section 40, is tolled from the date of enactment of
this law, if enacted, until June 1, 1997.
Subd. 2. [CONTINUE EVALUATION; REPORT.] (a) The
commissioner of revenue shall continue the evaluation to
determine the taxes paid by all affected political subdivisions
on solid waste management services as required by Minnesota
Statutes, section 297A.45. This is a continuation of the
evaluation provided for under Laws 1995, chapter 264, article 2,
section 40, except that the evaluation under this subdivision
includes all political subdivisions subject to the tax under
Minnesota Statutes, section 297A.45. The political subdivisions
shall cooperate fully and shall supply the commissioner of
revenue with whatever information the commissioner of revenue
deems necessary for compliance under the law.
(b) By May 1, 1996, the commissioner of revenue shall
notify all counties of the opportunity to correct the
information provided under Laws 1995, chapter 264, article 2,
section 40. A county must submit their corrections in writing
to the department of revenue by July 1, 1996.
(c) The commissioner of revenue shall report by January 15,
1997, the results of the evaluation under this subdivision to
the chairs of the house committee on taxes and the senate
committee on taxes and tax laws. The final results of the
evaluation are classified as public data.
Subd. 3. [TASK FORCE; SCOPE.] (a) The director of the
office of environmental assistance shall establish and staff a
task force to study implementation of the sales and use taxes on
solid waste management services under Minnesota Statutes,
section 297A.45, and the solid waste generator assessment under
Minnesota Statutes, section 116.07, subdivision 10. The task
force shall make recommendations to the sales tax advisory
council and to the chairs of the house environment and natural
resources committee, and the senate environment and natural
resources committee of the legislature:
(1) by November 30, 1996, for the goals itemized in
paragraph (c), clauses (1)(i) and (ii);
(2) by January 15, 1997, for the goals itemized in
paragraph (c), clauses (1)(iii) to (vii); and
(3) by February 15, 1997, for the goal itemized in
paragraph (c), clause (2).
(b) The task force shall consist of 14 voting members with
expertise in the areas of taxation or waste management, as
provided in this subdivision:
(1) four legislators, or their designees, including two
members of the senate, one from the minority party and one from
the majority party, appointed by the subcommittee on committees
of the committee on rules and administration and two members of
the house of representatives, one from the minority party and
one from the majority party, appointed by the speaker;
(2) two representatives from the department of revenue,
appointed by the commissioner of revenue;
(3) one representative from the office of environmental
assistance, appointed by the director of the office;
(4) one representative from the pollution control agency,
appointed by the commissioner of the agency;
(5) three persons representing political subdivisions, at
least one of which must represent county government, appointed
by the director of the office of environmental assistance; and
(6) three persons representing the private waste collection
industry, appointed by the director of the office of
environmental assistance, at least one of which is knowledgeable
on how taxing and pricing of waste collection services interact.
(c) The goals of the task force are:
(1) relating to solid waste management taxes:
(i) to monitor the evaluation conducted under subdivision 2
and to provide input to the commissioner of revenue if questions
of interpretations arise during the evaluation;
(ii) to discuss the tax base principles and possible
options to use for the tax period from January 1, 1990, to
December 31, 1995;
(iii) to discuss the base to which the tax applies
beginning January 1, 1996, taking into consideration the impact
on political subdivisions and private haulers, resulting from
recent court decisions regarding government control over the
flow of waste and the effect of these decisions on waste
management fee structures;
(iv) to examine the impact on total revenues from various
funding sources including tipping fees, service charges,
assessments, or subsidizing through the property tax system;
(v) to identify ways to simplify or restructure the current
tax system for ease of collection and administration;
(vi) to discuss methods to ensure that the taxes due to the
state are paid either by the haulers or the political
subdivisions; and
(vii) to recommend a procedure for keeping open
communication between the various entities on any future issues
relating to this tax; and
(2) relating to the solid waste generator assessment:
(i) to discuss the distinction between "residential" and
"nonresidential" for purposes of the solid waste generator
assessment under Minnesota Statutes, section 116.07, subdivision
10; and
(ii) to examine ways to simplify or restructure the current
assessment system for ease of collection and administration.
Subd. 4. [USE OF TAX PROCEEDS.] It is the legislature's
intent that the total amount of tax proceeds collected under
Minnesota Statutes, section 297A.45, less the department of
revenue's costs of administering the program including the cost
of conducting the evaluation under subdivision 2, be used for
administration of programs and functions related to reducing the
quantity and toxicity of solid waste, recycling, household
hazardous waste management, and other similarly related
programs. Appropriations may be made in block grants or
competitive grants to political subdivisions. Money may also be
used by the office of environmental assistance and the pollution
control agency in helping to administer and enforce the programs
and functions identified in this subdivision. Appropriations
may also be made to the state attorney general's office for
providing legal assistance to political subdivisions relating to
solid waste management.
Subd. 5. [DEPARTMENT OF REVENUE GUIDELINES.] The
commissioner of revenue shall prepare a single set of guidelines
for complying with Minnesota Statutes, section 297A.45,
including all existing rules, and shall send a copy of these
guidelines on or before May 1, 1996, to all known political
subdivisions subject to the tax under Minnesota Statutes,
section 297A.45. Notwithstanding taxes collected prior to
January 1, 1996, political subdivisions and persons responsible
for collecting the tax under Minnesota Statutes, section
297A.45, must follow these guidelines for all taxes collected on
solid waste management services beginning January 1, 1996. The
commissioner shall send a copy of the guidelines to the chairs
of the house committee on taxes and the senate committee on
taxes and tax laws by April 22, 1996, for their review and
comment.
Subd. 6. [SEPARATE REPORTING; ADDITIONAL PENALTY.] (a) In
order to determine the total amount of sales and use taxes
collected under Minnesota Statutes, section 297A.45, the
department of revenue shall reexamine the present method of
having this tax reported on the sales tax return. The
department must also consider other options including requiring
the sales and use tax amounts to be reported on a separate form.
(b) In addition to the penalties and interest that apply to
taxes under Minnesota Statutes, section 297A.45, a penalty equal
to the specified penalty of the taxpayer's tax liability is
imposed on any person or political subdivision who fails to
separately report the amount of the taxes due under Minnesota
Statutes, section 297A.45. The specified penalties are:
First violation ten percent
Second and subsequent
violations 20 percent
The additional penalties apply only to that portion of the
sales and use tax which should have been reported on the
separate line for taxes under Minnesota Statutes, section
297A.45, and that was included on other lines of the sales tax
return.
Subd. 7. [APPROPRIATION.] The amount necessary to conduct
the evaluation under subdivision 2, but not to exceed $250,000,
is appropriated for fiscal years 1996 and 1997, to the
commissioner of revenue from money deposited in the general fund
from the solid waste collection and disposal tax under Minnesota
Statutes, section 297A.45.
Subd. 8. [EFFECTIVE DATE.] Subdivisions 1 to 3, 6,
paragraph (a), and 7, are effective the day following final
enactment. Subdivisions 4 and 5 are effective for taxes
collected January 1, 1996, and thereafter. Subdivision 6,
paragraph (b), is effective for returns filed after September 1,
1996.
Sec. 29. [CITY OF HERMANTOWN; SALES TAX.]
Subdivision 1. [SALES TAX AUTHORIZED.] Notwithstanding
Minnesota Statutes, section 477A.016, or any other contrary
provision of law, ordinance, or city charter, the city of
Hermantown may, by ordinance, impose an additional sales tax of
up to one percent on sales transactions taxable pursuant to
Minnesota Statutes, chapter 297A, that occur within the city.
The proceeds of the tax imposed under this section must be used
to meet the costs of:
(1) extending a sewer interceptor line;
(2) construction of a booster pump station, reservoirs, and
related improvements to the water system; and
(3) construction of a police and fire station.
Subd. 2. [REFERENDUM.] If the Hermantown city council
proposes to impose the sales tax authorized by this section, it
shall conduct a referendum on the issue. The question of
imposing the tax must be submitted to the voters at a special or
general election. The tax may not be imposed unless a majority
of votes cast on the question of imposing the tax are in the
affirmative. The commissioner of revenue shall prepare a
suggested form of question to be presented at the election.
This subdivision applies notwithstanding any city charter
provision to the contrary.
Subd. 3. [ENFORCEMENT; COLLECTION; AND ADMINISTRATION OF
TAXES.] A sales tax imposed under this section must be reported
and paid to the commissioner of revenue with the state sales
taxes, and be subject to the same penalties, interest, and
enforcement provisions. The proceeds of the tax, less refunds
and a proportionate share of the cost of collection, shall be
remitted at least quarterly to the city. The commissioner shall
deduct from the proceeds remitted an amount that equals the
indirect statewide cost as well as the direct and indirect
department costs necessary to administer, audit, and collect the
tax. The amount deducted shall be deposited in the state
general fund.
Subd. 4. [TERMINATION.] The tax authorized under this
section terminates at the later of (1) ten years after the date
of initial imposition of the tax, or (2) on the first day of the
second month next succeeding a determination by the city council
that sufficient funds have been received from the tax to finance
the improvements described in subdivision 1, clauses (1) to (3),
and to prepay or retire at maturity the principal, interest, and
premium due on any bonds issued for the improvements. Any funds
remaining after completion of the improvements and retirement or
redemption of the bonds may be placed in the general fund of the
city.
Subd. 5. [LOCAL APPROVAL; EFFECTIVE DATE.] This section is
effective the day after final enactment, upon compliance with
Minnesota Statutes, section 645.021, subdivision 3, by the city
of Hermantown.
Sec. 30. [CITY OF LITTLE FALLS; TAX AUTHORIZED.]
Subdivision 1. [SALES OF FOOD; TAX.] The city of Little
Falls may by ordinance impose a tax of one-half percent on the
gross receipts from the retail sale of food and nonalcoholic
beverages sold by the operator of a restaurant or place of
refreshment within the city. The tax imposed may be effective
at any time after July 1, 1996.
Subd. 2. [DEFINITIONS.] For purposes of this section:
(1) "restaurant" means every building or other structure or
enclosure, or any part thereof and all buildings in connection,
kept, used or maintained as, or held out to the public to be an
enclosure where meals or lunches are served or prepared for
service elsewhere, except schools;
(2) "place of refreshment" means every building, structure,
vehicle, sidewalk cart or any part thereof, used as, maintained
as, or advertised as, or held out to be a place where
confectionery, ice cream, or drinks of various kinds are made,
sold, or served at retail, excepting schools and school
sponsored events; and
(3) "operator" means the person who is the proprietor of
the restaurant, or place of refreshment, whether in the capacity
of owner, lessee, subleases, licensee, or an other capacity.
Subd. 3. [USE OF PROCEEDS.] The ordinance adopted by the
city shall provide for distribution of the proceeds of the tax.
The proceeds of the tax must be used for tourism purposes,
including operating and maintaining the activities and programs
of the tourism and convention bureau.
Subd. 4. [ENFORCEMENT, COLLECTION, AND ADMINISTRATION OF
TAXES.] The tax imposed under this section shall be enforced,
administered, and collected by the city of Little Falls provided
that the city may contract with the commissioner of revenue to
perform audits of the tax on behalf of the city. The
commissioner shall charge the city an amount that equals the
direct and indirect costs incurred by the department that are
necessary to audit the tax.
Subd. 5. [EXPIRATION OF TAXING AUTHORITY.] The tax imposed
under this section shall expire 15 years after it first becomes
effective.
Subd. 6. [EFFECTIVE DATE.] This section is effective the
day following compliance by the governing body of the city of
Little Falls with Minnesota Statutes, section 645.021,
subdivision 3.
Sec. 31. [EFFECTIVE DATES.]
Sections 1 to 7, 10, 12, 16 to 20, 22, 26, and 27 are
effective the day after final enactment.
Sections 8 and 9 are effective for refunds applied for
after December 31, 1996.
Sections 11 and 13 are effective for sales made after
December 31, 1996.
Section 23 is effective for transfers of motor vehicles
after June 30, 1996.
Section 21 is effective for purchases made after June 30,
1996.
ARTICLE 3
PROPERTY TAXES
Section 1. Minnesota Statutes 1994, section 103E.611,
subdivision 7, is amended to read:
Subd. 7. [COLLECTION AND ENFORCEMENT OF DRAINAGE LIENS.]
The provisions of law that exist relating to the enforcement,
collection of, penalty, and interest provisions relating to real
estate taxes are adopted apply to enforce the payment of
drainage liens. If there is a default, a penalty may not be
added to an installment of principal and interest, but each
defaulted payment, principal, and interest draws interest from
the date of default until paid at the rate determined by the
state court administrator for judgments under section 549.09.
Sec. 2. Minnesota Statutes 1995 Supplement, section
124A.03, subdivision 2, is amended to read:
Subd. 2. [REFERENDUM REVENUE.] (a) The revenue authorized
by section 124A.22, subdivision 1, may be increased in the
amount approved by the voters of the district at a referendum
called for the purpose. The referendum may be called by the
school board or shall be called by the school board upon written
petition of qualified voters of the district. The referendum
shall be conducted one or two calendar years before the
increased levy authority, if approved, first becomes payable.
Only one election to approve an increase may be held in a
calendar year. Unless the referendum is conducted by mail under
paragraph (g), the referendum must be held on the first Tuesday
after the first Monday in November. The ballot shall state the
maximum amount of the increased revenue per actual pupil unit,
the estimated referendum tax rate as a percentage of market
value in the first year it is to be levied, and that the revenue
shall be used to finance school operations. The ballot may
state that existing referendum levy authority is expiring. In
this case, the ballot may also compare the proposed levy
authority to the existing expiring levy authority, and express
the proposed increase as the amount, if any, over the expiring
referendum levy authority. The ballot shall designate the
specific number of years, not to exceed ten, for which the
referendum authorization shall apply. The notice required under
section 275.60 may be modified to read, in cases of renewing
existing levies:
"BY VOTING "YES" ON THIS BALLOT QUESTION, YOU MAY BE VOTING
FOR A PROPERTY TAX INCREASE."
The ballot may contain a textual portion with the
information required in this subdivision and a question stating
substantially the following:
"Shall the increase in the revenue proposed by (petition
to) the board of ........., School District No. .., be approved?"
If approved, an amount equal to the approved revenue per
actual pupil unit times the actual pupil units for the school
year beginning in the year after the levy is certified shall be
authorized for certification for the number of years approved,
if applicable, or until revoked or reduced by the voters of the
district at a subsequent referendum.
(b) The school board shall prepare and deliver by first
class mail at least 15 days but no more than 30 days prior to
the day of the referendum to each taxpayer a notice of the
referendum and the proposed revenue increase. The school board
need not mail more than one notice to any taxpayer. For the
purpose of giving mailed notice under this subdivision, owners
shall be those shown to be owners on the records of the county
auditor or, in any county where tax statements are mailed by the
county treasurer, on the records of the county treasurer. Every
property owner whose name does not appear on the records of the
county auditor or the county treasurer shall be deemed to have
waived this mailed notice unless the owner has requested in
writing that the county auditor or county treasurer, as the case
may be, include the name on the records for this purpose. The
notice must project the anticipated amount of tax increase in
annual dollars and annual percentage for typical residential
homesteads, agricultural homesteads, apartments, and
commercial-industrial property within the school district.
The notice for a referendum may state that an existing
referendum levy is expiring and project the anticipated amount
of increase over the existing referendum levy, if any, in annual
dollars and annual percentage for typical residential
homesteads, agricultural homesteads, apartments, and
commercial-industrial property within the school district.
The notice must include the following statement: "Passage
of this referendum will result in an increase in your property
taxes." However, in cases of renewing existing levies, the
notice may include the following statement: "Passage of this
referendum may result in an increase in your property taxes."
(c) A referendum on the question of revoking or reducing
the increased revenue amount authorized pursuant to paragraph
(a) may be called by the school board and shall be called by the
school board upon the written petition of qualified voters of
the district. A referendum to revoke or reduce the levy amount
must be based upon the dollar amount, local tax rate, or amount
per actual pupil unit, that was stated to be the basis for the
initial authorization. Revenue approved by the voters of the
district pursuant to paragraph (a) must be received at least
once before it is subject to a referendum on its revocation or
reduction for subsequent years. Only one revocation or
reduction referendum may be held to revoke or reduce referendum
revenue for any specific year and for years thereafter.
(d) A petition authorized by paragraph (a) or (c) shall be
effective if signed by a number of qualified voters in excess of
15 percent of the registered voters of the school district on
the day the petition is filed with the school board. A
referendum invoked by petition shall be held on the date
specified in paragraph (a).
(e) The approval of 50 percent plus one of those voting on
the question is required to pass a referendum authorized by this
subdivision.
(f) At least 15 days prior to the day of the referendum,
the district shall submit a copy of the notice required under
paragraph (b) to the commissioner of children, families, and
learning and to the county auditor of each county in which the
school district is located. Within 15 days after the results of
the referendum have been certified by the school board, or in
the case of a recount, the certification of the results of the
recount by the canvassing board, the district shall notify the
commissioner of children, families, and learning of the results
of the referendum.
(g) Except for a referendum held under subdivision 2b, any
referendum under this section held on a day other than the first
Tuesday after the first Monday in November must be conducted by
mail in accordance with section 204B.46. Notwithstanding
paragraph (b) to the contrary, in the case of a referendum
conducted by mail under this paragraph, the notice required by
paragraph (b) shall be prepared and delivered by first class
mail at least 20 days before the referendum.
Sec. 3. Minnesota Statutes 1994, section 270.07,
subdivision 1, is amended to read:
Subdivision 1. [POWERS OF COMMISSIONER; APPLICATION FOR
ABATEMENT; ORDERS.] (a) The commissioner of revenue shall
prescribe the form of all blanks and books required under this
chapter and shall hear and determine all matters of grievance
relating to taxation. Except for matters delegated to the
various boards of county commissioners under section 375.192,
and except as otherwise provided by law, the commissioner shall
have power to grant such reduction or abatement of net tax
capacities or taxes and of any costs, penalties or interest
thereon as the commissioner may deem just and equitable, and to
order the refundment, in whole or in part, of any taxes, costs,
penalties or interest thereon which have been erroneously or
unjustly paid. Application therefor shall be submitted with a
statement of facts in the case and the favorable recommendation
of the county board or of the board of abatement of any city
where any such board exists, and the county auditor of the
county wherein such tax was levied or paid. In the case of taxes
other than gross earnings taxes, the order may be made only on
application and approval as provided in this paragraph. No
reduction, abatement, or refundment 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 such municipality.
(b) The commissioner has the power to grant reductions or
abatements of gross earnings tax. An application for reduction
of gross earnings taxes may be made directly to the commissioner
without the favorable action of the county board and county
auditor. The commissioner shall direct that any gross earnings
taxes that may have been erroneously or unjustly paid be applied
against unpaid taxes due from the applicant.
(c) The commissioner shall forward to the county auditor a
copy of the order made by the commissioner in all cases in which
the approval of the county board is required.
(d) The commissioner may refer any question that may arise
in reference to the true construction of this chapter to the
attorney general, and the decision thereon shall be in force and
effect until annulled by the judgment of a court of competent
jurisdiction.
(e) The commissioner may by written order abate, reduce, or
refund any penalty or interest imposed by any law relating to
taxation, if in the commissioner's opinion the failure to timely
pay the tax or failure to timely file the return is due to
reasonable cause. The order shall be made on application of the
taxpayer to the commissioner.
(f) If an order issued under this subdivision is for an
abatement, reduction, or refund of over $5,000, it shall be
valid only if approved in writing by the attorney general.
(g) An appeal may not be taken to the tax court from any
order of the commissioner of revenue made in the exercise of the
discretionary authority granted in paragraph (a) with respect to
the reduction or abatement of real or personal property taxes in
response to a taxpayer's application for an abatement,
reduction, or refund of taxes, net tax capacities, costs,
penalties, or interest.
Sec. 4. Minnesota Statutes 1994, section 273.02,
subdivision 3, is amended to read:
Subd. 3. [WHAT RIGHTS NOT AFFECTED.] Nothing in
subdivisions 1 to 3 shall affect any rights in undervalued or
erroneously classified property, acquired for value in good
faith prior to the correction of the net tax capacity thereof by
the county auditor as provided in this section. Any person
whose rights are adversely affected by any action of the county
auditor as provided in this subdivision may apply for a
reduction of the net tax capacity under the provisions of
section 270.07, relating to the powers of the commissioner of
revenue 375.192.
Sec. 5. Minnesota Statutes 1995 Supplement, section
273.11, subdivision 16, is amended to read:
Subd. 16. [VALUATION EXCLUSION FOR CERTAIN IMPROVEMENTS.]
Improvements to homestead property made before January 2, 2003,
shall be fully or partially excluded from the value of the
property for assessment purposes provided that (1) the house is
at least 35 years old at the time of the improvement and (2)
either
(a) the assessor's estimated market value of the house on
January 2 of the current year is equal to or less than $150,000,
or
(b) if the estimated market value of the house is over
$150,000 market value but is less than $300,000 on January 2 of
the current year, the property qualifies if
(i) it is located in a city or town in which 50 percent or
more of the owner-occupied housing units were constructed before
1960 based upon the 1990 federal census, and
(ii) the city or town's median family income based upon the
1990 federal census is less than the statewide median family
income based upon the 1990 federal census, or
(c) if the estimated market value of the house is $300,000
or more on January 2 of the current year, the property qualifies
if
(i) it is located in a city or town in which 45 percent or
more of the homes were constructed before 1940 based upon the
1990 federal census, and
(ii) it is located in a city or town in which 45 percent or
more of the housing units were rental based upon the 1990
federal census, and
(iii) the city or town's median value of owner occupied
housing units based upon the 1990 federal census is less than
the statewide median value of owner occupied housing units based
upon the 1990 federal census.
Any house which has an estimated market value of $300,000
or more on January 2 of the current year is not eligible to
receive any property valuation exclusion under this section.
For purposes of determining this eligibility, "house" means land
and buildings.
The age of a residence is the number of years that the
residence has existed at its present site. In the case of an
owner-occupied duplex or triplex, the improvement is eligible
regardless of which portion of the property was improved.
If the property lies in a jurisdiction which is subject to
a building permit process, a building permit must have been
issued prior to commencement of the improvement. Any
improvement must add at least $1,000 to the value of the
property to be eligible for exclusion under this subdivision.
Only improvements to the structure which is the residence of the
qualifying homesteader or construction of or improvements to no
more than one two-car garage per residence qualify for the
provisions of this subdivision. If an improvement was begun
between January 2, 1992, and January 2, 1993, any value added
from that improvement for the January 1994 and subsequent
assessments shall qualify for exclusion under this subdivision
provided that a building permit was obtained for the improvement
between January 2, 1992, and January 2, 1993. Whenever a
building permit is issued for property currently classified as
homestead, the issuing jurisdiction shall notify the property
owner of the possibility of valuation exclusion under this
subdivision. The assessor shall require an application,
including documentation of the age of the house from the owner,
if unknown by the assessor. The application may be filed
subsequent to the date of the building permit provided that the
application must be filed prior to July 1 of the assessment year
in which the market value from the qualifying improvement is
added to that property's assessment within three years of the
date the building permit was issued for the improvement. If the
property lies in a jurisdiction which is not subject to a
building permit process, the application must be filed within
three years of the date the improvement was made. The assessor
may require proof from the taxpayer of the date the improvement
was made. Applications must be received prior to July 1 of any
year in order to be effective for taxes payable in the following
year.
After the adjournment of the 1994 county board of
equalization meetings, No exclusion may be granted for an
improvement by a local board of review or county board of
equalization and no abatement of the taxes for qualifying
improvements may be granted by the county board unless (1) a
building permit was issued prior to the commencement of the
improvement if the jurisdiction requires a building permit, and
(2) an application was completed on a timely basis. No
abatement of the taxes for qualifying improvements may be
granted by a county board unless (1) a building permit was
issued prior to commencement of the improvement if the
jurisdiction requires a building permit, and (2) an application
was completed on a timely basis.
The assessor shall note the qualifying value of each
improvement on the property's record, and the sum of those
amounts shall be subtracted from the value of the property in
each year for ten years after the improvement has been made, at
which time an amount equal to 20 percent of the qualifying value
shall be added back in each of the five subsequent assessment
years. If an application is filed after the first assessment
date at which an improvement could have been subject to the
valuation exclusion under this subdivision, the ten-year period
during which the value is subject to exclusion is reduced by the
number of years that have elapsed since the property would have
qualified initially. The valuation exclusion shall terminate
whenever (1) the property is sold, or (2) the property is
reclassified to a class which does not qualify for treatment
under this subdivision. Improvements made by an occupant who is
the purchaser of the property under a conditional purchase
contract do not qualify under this subdivision unless the seller
of the property is a governmental entity. The qualifying value
of the property shall be computed based upon the increase from
that structure's market value as of January 2 preceding the
acquisition of the property by the governmental entity.
The total qualifying value for a homestead may not exceed
$50,000. The total qualifying value for a homestead with a
house that is less than 70 years old may not exceed $25,000.
The term "qualifying value" means the increase in estimated
market value resulting from the improvement if the improvement
occurs when the house is at least 70 years old, or one-half of
the increase in estimated market value resulting from the
improvement otherwise. The $25,000 and $50,000 maximum
qualifying value under this subdivision may result from up to
three separate improvements to the homestead. The application
shall state, in clear language, that if more than three
improvements are made to the qualifying property, a taxpayer may
choose which three improvements are eligible, provided that
after the taxpayer has made the choice and any valuation
attributable to those improvements has been excluded from
taxation, no further changes can be made by the taxpayer.
If 50 percent or more of the square footage of a structure
is voluntarily razed or removed, the valuation increase
attributable to any subsequent improvements to the remaining
structure does not qualify for the exclusion under this
subdivision. If a structure is unintentionally or accidentally
destroyed by a natural disaster, the property is eligible for an
exclusion under this subdivision provided that the structure was
not completely destroyed. The qualifying value on property
destroyed by a natural disaster shall be computed based upon the
increase from that structure's market value as determined on
January 2 of the year in which the disaster occurred. A
property receiving benefits under the homestead disaster
provisions under section 273.123 is not disqualified from
receiving an exclusion under this subdivision. If any
combination of improvements made to a structure after January 1,
1993, increases the size of the structure by 100 percent or
more, the valuation increase attributable to the portion of the
improvement that causes the structure's size to exceed 100
percent does not qualify for exclusion under this subdivision.
Sec. 6. Minnesota Statutes 1994, section 273.111,
subdivision 3, is amended to read:
Subd. 3. (a) Real estate consisting of ten acres or more
or a nursery or greenhouse, and qualifying for classification as
class 1b, 2a, or 2b under section 273.13, subdivision 23,
paragraph (d), shall be entitled to valuation and tax deferment
under this section only if it is actively and exclusively
devoted to agricultural use as defined in subdivision 6 and
either:
(1) is the homestead of the owner, or of a surviving
spouse, child, or sibling of the owner or is real estate which
is farmed with the real estate which contains the homestead
property; or
(2) has been in possession of the applicant, the
applicant's spouse, parent, or sibling, or any combination
thereof, for a period of at least seven years prior to
application for benefits under the provisions of this section,
or is real estate which is farmed with the real estate which
qualifies under this clause and is within two townships or
cities or combination thereof from the qualifying real estate;
or
(3) is the homestead of a shareholder in a family farm
corporation as defined in section 500.24, notwithstanding the
fact that legal title to the real estate may be held in the name
of the family farm corporation; or
(4) is in the possession of a nursery or greenhouse or an
entity owned by a proprietor, partnership, or corporation which
also owns the nursery or greenhouse operations on the parcel or
parcels.
(b) Valuation of real estate under this section is limited
to parcels the ownership of which is in noncorporate entities
except for:
(1) family farm corporations organized pursuant to section
500.24; and
(2) corporations that derive 80 percent or more of their
gross receipts from the wholesale or retail sale of
horticultural or nursery stock.
Corporate entities who previously qualified for tax
deferment pursuant to this section and who continue to otherwise
qualify under subdivisions 3 and 6 for a period of at least
three years following the effective date of Laws 1983, chapter
222, section 8, will not be required to make payment of the
previously deferred taxes, notwithstanding the provisions of
subdivision 9. Sale of the land prior to the expiration of the
three-year period shall result in payment of deferred taxes as
follows: sale within the first year requires payment of payable
1980, 1981, and 1982 deferred taxes; sale during the second year
requires payment of payable 1981 and 1982 taxes deferred; and
sale at any time during the third year will require payment of
payable 1983 taxes deferred. Deferred taxes shall be paid even
if the land qualifies pursuant to subdivision 11a. Special
assessments are payable at the end of the three-year period or
at time of sale, whichever comes first.
(c) Land that previously qualified for tax deferment
pursuant to this section and no longer qualifies because it is
not classified as agricultural land but would otherwise qualify
under subdivisions 3 and 6 for a period of at least three years
will not be required to make payment of the previously deferred
taxes, notwithstanding the provisions of subdivision 9. Sale of
the land prior to the expiration of the three-year period
requires payment of deferred taxes as follows: sale in the year
the land no longer qualifies requires payment of the current
year's deferred taxes plus payment of deferred taxes for the two
prior years; sale during the second year the land no longer
qualifies requires payment of the current year's deferred taxes
plus payment of the deferred taxes for the prior year; and sale
during the third year the land no longer qualifies requires
payment of the current year's deferred taxes. Deferred taxes
shall be paid even if the land qualifies pursuant to subdivision
11a. When such property is sold or no longer qualifies under
this paragraph, or at the end of the three-year period,
whichever comes first, all deferred special assessments plus
interest are payable in equal installments spread over the time
remaining until the last maturity date of the bonds issued to
finance the improvement for which the assessments were levied.
If the bonds have matured, the deferred special assessments plus
interest are payable within 90 days. The provisions of section
429.061, subdivision 2, apply to the collection of these
installments. Penalties are not imposed on any such special
assessments if timely paid.
Sec. 7. Minnesota Statutes 1995 Supplement, section
273.124, subdivision 1, is amended to read:
Subdivision 1. [GENERAL RULE.] (a) Residential real estate
that is occupied and used for the purposes of a homestead by its
owner, who must be a Minnesota resident, is a residential
homestead.
Agricultural land, as defined in section 273.13,
subdivision 23, that is occupied and used as a homestead by its
owner, who must be a Minnesota resident, is an agricultural
homestead.
Dates for establishment of a homestead and homestead
treatment provided to particular types of property are as
provided in this section.
Property of a trustee, beneficiary, or grantor of a trust
is not disqualified from receiving homestead benefits if the
homestead requirements under this chapter are satisfied.
The assessor shall require proof, as provided in
subdivision 13, of the facts upon which classification as a
homestead may be determined. Notwithstanding any other law, the
assessor may at any time require a homestead application to be
filed in order to verify that any property classified as a
homestead continues to be eligible for homestead status.
Notwithstanding any other law to the contrary, the department of
revenue may, upon request from an assessor, verify whether an
individual who is requesting or receiving homestead
classification has filed a Minnesota income tax return as a
resident for the most recent taxable year for which the
information is available.
When there is a name change or a transfer of homestead
property, the assessor may reclassify the property in the next
assessment unless a homestead application is filed to verify
that the property continues to qualify for homestead
classification.
(b) For purposes of this section, homestead property shall
include property which is used for purposes of the homestead but
is separated from the homestead by a road, street, lot,
waterway, or other similar intervening property. The term "used
for purposes of the homestead" shall include but not be limited
to uses for gardens, garages, or other outbuildings commonly
associated with a homestead, but shall not include vacant land
held primarily for future development. In order to receive
homestead treatment for the noncontiguous property, the owner
shall apply for it to the assessor by July 1 of the year when
the treatment is initially sought. After initial qualification
for the homestead treatment, additional applications for
subsequent years are not required.
(c) Residential real estate that is occupied and used for
purposes of a homestead by a relative of the owner is a
homestead but only to the extent of the homestead treatment that
would be provided if the related owner occupied the property.
For purposes of this paragraph and paragraph (f), "relative"
means a parent, stepparent, child, stepchild, grandparent,
grandchild, brother, sister, uncle, or aunt. This relationship
may be by blood or marriage. Property that has been classified
as seasonal recreational residential property at any time during
which it has been owned by the current owner or spouse of the
current owner will not be reclassified as a homestead unless it
is occupied as a homestead by the owner; this prohibition also
applies to property that, in the absence of this paragraph,
would have been classified as seasonal recreational residential
property at the time when the residence was constructed.
Neither the related occupant nor the owner of the property may
claim a property tax refund under chapter 290A for a homestead
occupied by a relative. In the case of a residence located on
agricultural land, only the house, garage, and immediately
surrounding one acre of land shall be classified as a homestead
under this paragraph, except as provided in paragraph (d).
(d) Agricultural property that is occupied and used for
purposes of a homestead by a relative of the owner, is a
homestead, only to the extent of the homestead treatment that
would be provided if the related owner occupied the property,
and only if all of the following criteria are met:
(1) the relative who is occupying the agricultural property
is a son, daughter, father, or mother of the owner of the
agricultural property or a son or daughter of the spouse of the
owner of the agricultural property,
(2) the owner of the agricultural property must be a
Minnesota resident,
(3) the owner of the agricultural property must not receive
homestead treatment on any other agricultural property in
Minnesota, and
(4) the owner of the agricultural property is limited to
only one agricultural homestead per family under this paragraph.
Neither the related occupant nor the owner of the property
may claim a property tax refund under chapter 290A for a
homestead occupied by a relative qualifying under this
paragraph. For purposes of this paragraph, "agricultural
property" means the house, garage, other farm buildings and
structures, and agricultural land.
Application must be made to the assessor by the owner of
the agricultural property to receive homestead benefits under
this paragraph. The assessor may require the necessary proof
that the requirements under this paragraph have been met.
(e) In the case of property owned by a property owner who
is married, the assessor must not deny homestead treatment in
whole or in part if only one of the spouses occupies the
property and the other spouse is absent due to: (1) marriage
dissolution proceedings, (2) legal separation, (3) employment or
self-employment in another location, (4) residence in a nursing
home or boarding care facility, or (5) other personal
circumstances causing the spouses to live separately, not
including an intent to obtain two homestead classifications for
property tax purposes. To qualify under clause (3), the
spouse's place of employment or self-employment must be at least
50 miles distant from the other spouse's place of employment,
and the homesteads must be at least 50 miles distant from each
other. Homestead treatment, in whole or in part, shall not be
denied to the spouse of an owner if he or she previously
occupied the residence with the owner and the absence of the
owner is due to one of the exceptions provided in this paragraph.
(f) If an individual is purchasing property with the intent
of claiming it as a homestead and is required by the terms of
the financing agreement to have a relative shown on the deed as
a coowner, the assessor shall allow a full homestead
classification. This provision only applies to first-time
purchasers, whether married or single, or to a person who had
previously been married and is purchasing as a single individual
for the first time. The application for homestead benefits must
be on a form prescribed by the commissioner and must contain the
data necessary for the assessor to determine if full homestead
benefits are warranted.
Sec. 8. Minnesota Statutes 1995 Supplement, section
273.124, subdivision 3, is amended to read:
Subd. 3. [COOPERATIVES AND CHARITABLE CORPORATIONS;
HOMESTEAD AND OTHER PROPERTY.] (a) When one or more dwellings,
or one or more buildings which each contain several dwelling
units, are property 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 dwelling building on the property, or dwelling a unit
in the within a building on the property, the corporation or
association may claim homestead treatment for each dwelling, or
for each unit in the case of a building containing several
dwelling units, for the dwelling or for the part of the value of
the building occupied by a shareholder. Each dwelling building
or unit must be designated by legal description or number, and.
The net tax capacity of each dwelling building or unit that
qualifies for assessment as a homestead under this subdivision
must include not more than one-half acre of land, if platted,
nor more than 80 acres if unplatted. The net tax capacity of
the building or buildings containing several dwelling
units property is the sum of the net tax capacities of each of
the respective buildings or units comprising the building
property, including the net tax capacity of each unit's or
building's proportionate share of the land and any common
buildings. To qualify for the treatment provided by this
subdivision, the corporation or association must be wholly owned
by persons having a right to occupy a dwelling building or
dwelling unit owned by the corporation or association. A
charitable corporation organized under the laws of Minnesota and
not otherwise exempt thereunder with no outstanding stock
qualifies for homestead treatment with respect to member
residents of the dwelling units who have purchased and hold
residential participation warrants entitling them to occupy the
units.
(b) To the extent provided in paragraph (a), a cooperative
or corporation organized under chapter 308A may obtain separate
assessment and valuation, and separate property tax statements
for each residential homestead, residential nonhomestead, or for
each seasonal residential recreational building or unit not used
for commercial purposes. The appropriate class rates under
section 273.13 shall be applicable as if each building or unit
were a separate tax parcel; provided, however, that the tax
parcel which exists at the time the cooperative or corporation
makes application under this subdivision shall be a single
parcel for purposes of property taxes or the enforcement and
collection thereof, other than as provided in paragraph (a) or
(b).
(c) A member of a corporation or association may initially
obtain the separate assessment and valuation and separate
property tax statements, as provided in paragraph (b), by
applying to the assessor by June 30 of the assessment year.
(d) When a building, or dwelling units within a building,
no longer qualify under this subdivision paragraph (a) or (b),
the current owner must notify the assessor within 60 30 days.
Failure to notify the assessor within 60 30 days shall result in
the loss of benefits under this subdivision paragraph (a) or (b)
for taxes payable in the year that the failure is discovered.
For these purposes, "benefits under this subdivision paragraph
(a) or (b)" means the difference in the net tax capacity of
the building or units which no longer qualify as computed
under this subdivision paragraph (a) or (b) and as computed
under the otherwise applicable law, times the local tax rate
applicable to the building for that taxes payable year. Upon
discovery of a failure to notify, the assessor shall inform the
auditor of the difference in net tax capacity for the building
or buildings in which units no longer qualify, and the auditor
shall calculate the benefits under this subdivision paragraph
(a) or (b). Such amount, plus a penalty equal to 100 percent of
that amount, shall then be demanded of the building's owner.
The property owner may appeal the county's determination by
serving copies of a petition for review with county officials as
provided in section 278.01 and filing a proof of service as
provided in section 278.01 with the Minnesota tax court within
60 days of the date of the notice from the county. The appeal
shall be governed by the tax court procedures provided in
chapter 271, for cases relating to the tax laws as defined in
section 271.01, subdivision 5; disregarding sections 273.125,
subdivision 5, and 278.03, but including section 278.05,
subdivision 2. If the amount of the benefits under this
subdivision paragraph (a) or (b) and penalty are not paid within
60 days, and if no appeal has been filed, the county auditor
shall certify the amount of the benefit and penalty to the
succeeding year's tax list to be collected as part of the
property taxes on the affected buildings property.
Sec. 9. Minnesota Statutes 1995 Supplement, section
273.124, subdivision 13, is amended to read:
Subd. 13. [HOMESTEAD APPLICATION.] (a) A person who meets
the homestead requirements under subdivision 1 must file a
homestead application with the county assessor to initially
obtain homestead classification.
(b) On or before January 2, 1993, each county assessor
shall mail a homestead application to the owner of each parcel
of property within the county which was classified as homestead
for the 1992 assessment year. The format and contents of a
uniform homestead application shall be prescribed by the
commissioner of revenue. The commissioner shall consult with
the chairs of the house and senate tax committees on the
contents of the homestead application form. The application
must clearly inform the taxpayer that this application must be
signed by all owners who occupy the property or by the
qualifying relative and returned to the county assessor in order
for the property to continue receiving homestead treatment. The
envelope containing the homestead application shall clearly
identify its contents and alert the taxpayer of its necessary
immediate response.
(c) Every property owner applying for homestead
classification must furnish to the county assessor the social
security number of each occupant who is listed as an owner of
the property on the deed of record, the name and address of each
owner who does not occupy the property, and the name and social
security number of each owner's spouse who occupies the
property. The application must be signed by each owner who
occupies the property and by each owner's spouse who occupies
the property, or, in the case of property that qualifies as a
homestead under subdivision 1, paragraph (c), by the qualifying
relative.
If a property owner occupies a homestead, the property
owner's spouse may not claim another property as a homestead
unless the property owner and the property owner's spouse file
with the assessor an affidavit or other proof required by the
assessor stating that the property qualifies as a homestead
under subdivision 1, paragraph (e).
Owners or spouses occupying residences owned by their
spouses and previously occupied with the other spouse, either of
whom fail to include the other spouse's name and social security
number on the homestead application or provide the affidavits or
other proof requested, will be deemed to have elected to receive
only partial homestead treatment of their residence. The
remainder of the residence will be classified as nonhomestead
residential. When an owner or spouse's name and social security
number appear on homestead applications for two separate
residences and only one application is signed, the owner or
spouse will be deemed to have elected to homestead the residence
for which the application was signed.
The social security numbers or affidavits or other proofs
of the property owners and spouses are private data on
individuals as defined by section 13.02, subdivision 12, but,
notwithstanding that section, the private data may be disclosed
to the commissioner of revenue, or, for purposes of proceeding
under the revenue recapture act to recover personal property
taxes owing, to the county treasurer.
(d) If residential real estate is occupied and used for
purposes of a homestead by a relative of the owner and qualifies
for a homestead under subdivision 1, paragraph (c), in order for
the property to receive homestead status, a homestead
application must be filed with the assessor. The social
security number of each relative occupying the property and the
social security number of each owner who is related to an
occupant of the property shall be required on the homestead
application filed under this subdivision. If a different
relative of the owner subsequently occupies the property, the
owner of the property must notify the assessor within 30 days of
the change in occupancy. The social security number of a
relative occupying the property is private data on individuals
as defined by section 13.02, subdivision 12, but may be
disclosed to the commissioner of revenue.
(e) The homestead application shall also notify the
property owners that the application filed under this section
will not be mailed annually and that if the property is granted
homestead status for the 1993 assessment, or any assessment year
thereafter, that same property shall remain classified as
homestead until the property is sold or transferred to another
person, or the owners, the spouse of the owner, or the relatives
no longer use the property as their homestead. Upon the sale or
transfer of the homestead property, a certificate of value must
be timely filed with the county auditor as provided under
section 272.115. Failure to notify the assessor within 30 days
that the property has been sold, transferred, or that the owner,
the spouse of the owner, or the relative is no longer occupying
the property as a homestead, shall result in the penalty
provided under this subdivision and the property will lose its
current homestead status.
(f) If the homestead application is not returned within 30
days, the county will send a second application to the present
owners of record. The notice of proposed property taxes
prepared under section 275.065, subdivision 3, shall reflect the
property's classification. Beginning with assessment year 1993
for all properties, If a homestead application has not been
filed with the county by December 15, the assessor shall
classify the property as nonhomestead for the current assessment
year for taxes payable in the following year, provided that the
owner may be entitled to receive the homestead classification by
proper application under section 375.192.
(g) At the request of the commissioner, each county must
give the commissioner a list that includes the name and social
security number of each property owner and the property owner's
spouse occupying the property, or relative of a property owner,
applying for homestead classification under this subdivision.
The commissioner shall use the information provided on the lists
as appropriate under the law, including for the detection of
improper claims by owners, or relatives of owners, under chapter
290A.
(h) If, in comparing the lists supplied by the counties,
the commissioner finds that a property owner may be claiming a
fraudulent homestead, the commissioner shall notify the
appropriate counties. Within 90 days of the notification, the
county assessor shall investigate to determine if the homestead
classification was properly claimed. If the property owner does
not qualify, the county assessor shall notify the county auditor
who will determine the amount of homestead benefits that had
been improperly allowed. For the purpose of this section,
"homestead benefits" means the tax reduction resulting from the
classification as a homestead under section 273.13, the taconite
homestead credit under section 273.135, and the supplemental
homestead credit under section 273.1391.
The county auditor shall send a notice to the person who
owned the owners of the affected property at the time the
homestead application related to the improper homestead was
filed, demanding reimbursement of the homestead benefits plus a
penalty equal to 100 percent of the homestead benefits.
The property owners person notified may appeal the county's
determination by filing a notice of appeal serving copies of a
petition for review with county officials as provided in section
278.01 and filing proof of service as provided in section 278.01
with the Minnesota tax court within 60 days of the date of the
notice from the county. Procedurally, the appeal is governed by
the provisions in chapter 271 which apply to the appeal of a
property tax assessment or levy, but without requiring any
prepayment of the amount in controversy. If the amount of
homestead benefits and penalty is not paid within 60 days, and
if no appeal has been filed, the county auditor shall certify
the amount of taxes and penalty to the succeeding year's tax
list to be collected as part of the property taxes. In the case
of a manufactured home, the amount shall be certified to the
current year's tax list for collection county treasurer. The
county treasurer will add interest to the unpaid homestead
benefits and penalty amounts at the rate provided for delinquent
personal property taxes for the period beginning 60 days after
demand for payment was made until payment. If the person
notified is the current owner of the property, the treasurer may
add the total amount of benefits, penalty, interest, and costs
to the real estate taxes otherwise payable on the property in
the following year. If the person notified is not the current
owner of the property, the treasurer may collect the amounts due
under the revenue recapture act in chapter 270A, or use any of
the powers granted in sections 277.20 and 277.21 without
exclusion, to enforce payment of the benefits, penalty,
interest, and costs, as if those amounts were delinquent tax
obligations of the person who owned the property at the time the
application related to the improperly allowed homestead was
filed. The treasurer may relieve a prior owner of personal
liability for the benefits, penalty, interest, and costs, and
instead extend those amounts on the tax lists against the
property for taxes payable in the following year to the extent
that the current owner agrees in writing.
(i) Any amount of homestead benefits recovered by the
county from the property owner shall be distributed to the
county, city or town, and school district where the property is
located in the same proportion that each taxing district's levy
was to the total of the three taxing districts' levy for the
current year. Any amount recovered attributable to taconite
homestead credit shall be transmitted to the St. Louis county
auditor to be deposited in the taconite property tax relief
account. Any amount recovered that is attributable to
supplemental homestead credit is to be transmitted to the
commissioner of revenue for deposit in the general fund of the
state treasury. The total amount of penalty collected must be
deposited in the county general fund.
(j) If a property owner has applied for more than one
homestead and the county assessors cannot determine which
property should be classified as homestead, the county assessors
will refer the information to the commissioner. The
commissioner shall make the determination and notify the
counties within 60 days.
(k) In addition to lists of homestead properties, the
commissioner may ask the counties to furnish lists of all
properties and the record owners.
Sec. 10. Minnesota Statutes 1994, 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 $72,000 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. For taxes
payable in 1992, the market value of class 1a property that
exceeds $72,000 but does not exceed $115,000 has a class rate of
two percent of its market value; and the market value of class
1a property that exceeds $115,000 has a class rate of 2.5
percent of its market value. For taxes payable in 1993 and
thereafter, the market value of class 1a property that exceeds
$72,000 has a class rate of two percent.
(b) Class 1b property includes homestead real estate or
homestead manufactured homes used for the purposes of a
homestead by
(1) any blind person, or the blind person and the blind
person's spouse; 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) 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
(G) pension, annuity, or other income paid as a result of
that disability from a private pension or disability plan,
including employer, employee, union, and insurance plans and
(iii) has household income as defined in section 290A.03,
subdivision 5, of $50,000 or less; or
(4) any person who is permanently and totally disabled and
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 under clause (4) only
if the government agency or income-providing source certifies,
upon the request of the homestead occupant, that the homestead
occupant satisfies the disability requirements of this paragraph.
Property is classified and assessed pursuant to clause (1)
only if the commissioner of economic security certifies to the
assessor that the homestead occupant satisfies the requirements
of this paragraph.
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 .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 250 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 for residential occupancy
and a fee is charged for residential occupancy. Class 1c
property has a class rate of 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. 11. Minnesota Statutes 1994, 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. The value of the remaining land including
improvements up to $115,000 has a net class rate of .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 $115,000
of market value that does not exceed 320 acres has a net class
rate of one percent of market value, and a gross class rate of
2.25 percent of market value. The remaining property over the
$115,000 market value in excess of 320 acres has a class rate of
1.5 percent of market value, and a gross class rate 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; (2) real estate that is not
improved with a structure and is used exclusively for growing
trees for timber, lumber, and wood and wood products, if the
owner has participated or is participating in a cost-sharing
program for afforestation, reforestation, or timber stand
improvement on that particular property, administered or
coordinated by the commissioner of natural resources; (3) real
estate that is nonhomestead agricultural land; or (4) a landing
area or public access area of a privately owned public use
airport. Class 2b property has a net class rate of 1.5 percent
of market value, 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 state or federal farm or conservation programs.
"Agricultural purposes" as used in this section means the
raising or cultivation of agricultural products. Land enrolled
in the Reinvest in Minnesota program under sections 103F.505 to
103F.531 or the federal Conservation Reserve Program as
contained in Public Law Number 99-198, and consisting of a
minimum of ten contiguous acres, shall be classified as
agricultural. Agricultural classification for property shall be
determined with respect to the use of the whole parcel, and not
based upon the market value of any residential structures on the
parcel or contiguous parcels under the same ownership.
(d) Real estate of less than ten acres used principally for
raising or cultivating agricultural products, shall be
considered as agricultural land, if it is not used primarily for
residential purposes.
(e) The term "agricultural products" as used in this
subdivision includes:
(1) livestock, dairy animals, dairy products, poultry and
poultry products, fur-bearing animals, horticultural and nursery
stock described in sections 18.44 to 18.61, fruit of all kinds,
vegetables, forage, grains, bees, and apiary products by the
owner;
(2) fish bred for sale and consumption if the fish breeding
occurs on land zoned for agricultural use;
(3) the commercial boarding of horses if the boarding is
done in conjunction with raising or cultivating agricultural
products as defined in clause (1);
(4) property which is owned and operated by nonprofit
organizations used for equestrian activities, excluding racing;
and
(5) game birds and waterfowl bred and raised for use on a
shooting preserve licensed under section 97A.115.
(f) 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.
(g) To qualify for classification under paragraph (b),
clause (4), a privately owned public use airport must be
licensed as a public airport under section 360.018. For
purposes of paragraph (b), clause (4), "landing area" means that
part of a privately owned public use airport properly cleared,
regularly maintained, and made available to the public for use
by aircraft and includes runways, taxiways, aprons, and sites
upon which are situated landing or navigational aids. A landing
area also includes land underlying both the primary surface and
the approach surfaces that comply with all of the following:
(i) the land is properly cleared and regularly maintained
for the primary purposes of the landing, taking off, and taxiing
of aircraft; but that portion of the land that contains
facilities for servicing, repair, or maintenance of aircraft is
not included as a landing area;
(ii) the land is part of the airport property; and
(iii) the land is not used for commercial or residential
purposes.
The land contained in a landing area under paragraph (b), clause
(4), must be described and certified by the commissioner of
transportation. The certification is effective until it is
modified, or until the airport or landing area no longer meets
the requirements of paragraph (b), clause (4). For purposes of
paragraph (b), clause (4), "public access area" means property
used as an aircraft parking ramp, apron, or storage hangar, or
an arrival and departure building in connection with the airport.
Sec. 12. Minnesota Statutes 1995 Supplement, section
273.13, subdivision 25, 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
in a city with a population of 5,000 or less, that is (1)
located outside of the metropolitan area, as defined in section
473.121, subdivision 2, or outside any county contiguous to the
metropolitan area, and (2) whose city boundary is at least 15
miles from the boundary of any city with a population greater
than 5,000 has a class rate of 2.3 percent of market value for
taxes payable in 1996 and thereafter. All other class 4a
property has a class rate of 3.4 percent of market value for
taxes payable in 1996 and thereafter. For purposes of this
paragraph, population has the same meaning given in section
477A.011, subdivision 3.
(b) Class 4b includes:
(1) residential real estate containing less than four
units, other than seasonal residential, and recreational;
(2) manufactured homes not classified under any other
provision;
(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 2.8 percent of market
value for taxes payable in 1992, 2.5 percent of market value for
taxes payable in 1993, and 2.3 percent of market value for taxes
payable in 1994 and thereafter.
(c) Class 4c property includes:
(1) a structure that is:
(i) situated on real property that is used for housing for
the elderly or for low- and moderate-income families as defined
in Title II, as amended through December 31, 1990, of the
National Housing Act or the Minnesota housing finance agency law
of 1971, as amended, or rules promulgated by the agency and
financed by a direct federal loan or federally insured loan made
pursuant to Title II of the Act; or
(ii) situated on real property that is used for housing the
elderly or for low- and moderate-income families as defined by
the Minnesota housing finance agency law of 1971, as amended, or
rules adopted by the agency pursuant thereto and financed by a
loan made by the Minnesota housing finance agency pursuant to
the provisions of the act.
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 as defined in section
42(c)(2) of the Internal Revenue Code of 1986, as amended
through December 31, 1990, that (i) receives a low-income
housing credit under section 42 of the Internal Revenue Code of
1986, as amended through December 31, 1990; or (ii) meets the
requirements of that section and receives public financing,
except financing provided under sections 469.174 to 469.179,
which contains terms restricting the rents; or (iii) meets the
requirements of section 273.1317. Classification pursuant to
this clause is limited to a term of 15 years. The public
financing received must be from at least one of the following
sources: government issued bonds exempt from taxes under
section 103 of the Internal Revenue Code of 1986, as amended
through December 31, 1993, the proceeds of which are used for
the acquisition or rehabilitation of the building; programs
under section 221(d)(3), 202, or 236, of Title II of the
National Housing Act; rental housing program funds under Section
8 of the United States Housing Act of 1937 or the market rate
family graduated payment mortgage program funds administered by
the Minnesota housing finance agency that are used for the
acquisition or rehabilitation of the building; public financing
provided by a local government used for the acquisition or
rehabilitation of the building, including grants or loans from
federal community development block grants, HOME block grants,
or residential rental bonds issued under chapter 474A; or other
rental housing program funds provided by the Minnesota housing
finance agency for the acquisition or rehabilitation of the
building.
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 unless the owner of the property
elects to have the property assessed under Laws 1991, chapter
291, article 1, section 55. If the owner of the property elects
to have the market value determined on the basis of the actual
restricted rents, as provided in Laws 1991, chapter 291, article
1, section 55, the property will be assessed at the rate
provided for class 4a or class 4b property, as appropriate.
Properties described in clauses (1)(ii), (3), and (4) may apply
to the assessor for valuation under Laws 1991, chapter 291,
article 1, section 55. 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. This clause applies only to the property of a nonprofit
or limited dividend entity.
(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
317A;
(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 250 days in the year preceding the year of
assessment. For purposes of this clause, property is devoted to
a commercial purpose on a specific day if any portion of the
property is used for residential occupancy, and a fee is charged
for 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 250 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 also includes the remainder
of class 1c resorts. Owners of real property devoted to
temporary and seasonal residential occupancy for recreation
purposes and all or a portion of which was devoted to commercial
purposes for not more than 250 days in the year preceding the
year of assessment desiring classification as class 1c or 4c,
must submit a declaration to the assessor designating the cabins
or units occupied for 250 days or less in the year preceding the
year of assessment by January 15 of the assessment year. Those
cabins or units and a proportionate share of the land on which
they are located will be designated class 1c or 4c as otherwise
provided. The remainder of the cabins or units and a
proportionate share of the land on which they are located will
be designated as class 3a. The first $100,000 of the market
value of the remainder of the cabins or units and a
proportionate share of the land on which they are located shall
have a class rate of three percent. The owner of property
desiring designation as class 1c or 4c property must provide
guest registers or other records demonstrating that the units
for which class 1c or 4c designation is sought were not occupied
for more than 250 days in the year preceding the assessment if
so requested. The portion of a property operated as a (1)
restaurant, (2) bar, (3) gift shop, and (4) other nonresidential
facility operated on a commercial basis not directly related to
temporary and seasonal residential occupancy for recreation
purposes shall not qualify for class 1c or 4c;
(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, 1990. 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 3.2
percent 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;
(7) post-secondary student housing of not more than one
acre of land that is owned by a nonprofit corporation organized
under chapter 317A 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 2.3 percent of market
value, except that (i) for each parcel of seasonal residential
recreational property not used for commercial purposes under
clause (5) the first $72,000 of market value on each parcel has
a class rate of 1.9 1.75 percent for taxes payable in 1997 and
1.8 1.5 percent for taxes payable in 1998 and thereafter, and
the market value of each parcel that exceeds $72,000 has a class
rate of 2.5 percent, and (ii) manufactured home parks assessed
under clause (8) have a class rate of two percent for taxes
payable in 1996, and thereafter.
(d) Class 4d property includes:
(1) a structure that is:
(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. For those properties, 4c or 4d
classification is available only for those units meeting the
requirements of section 273.1318.
Classification under this clause is only available to
property of a nonprofit or limited dividend entity.
In the case of a structure financed or refinanced under any
federal or state mortgage insurance or direct loan program
exclusively for housing for the elderly or for housing for the
handicapped, a unit shall be considered occupied so long as it
is actually occupied by an elderly or handicapped person or, if
vacant, is held for rental to an elderly or handicapped person.
(2) For taxes payable in 1992, 1993, and 1994, only,
buildings and appurtenances, together with the land upon which
they are located, leased by the occupant under the community
lending model lease-purchase mortgage loan program administered
by the Federal National Mortgage Association, provided the
occupant's income is no greater than 60 percent of the county or
area median income, adjusted for family size and the building
consists of existing single family or duplex housing. The lease
agreement must provide for a portion of the lease payment to be
escrowed as a nonrefundable down payment on the housing. To
qualify under this clause, the taxpayer must apply to the county
assessor by May 30 of each year. The application must be
accompanied by an affidavit or other proof required by the
assessor to determine qualification under this clause.
(3) Qualifying buildings and appurtenances, together with
the land upon which they are located, leased for a period of up
to five years by the occupant under a lease-purchase program
administered by the Minnesota housing finance agency or a
housing and redevelopment authority authorized under sections
469.001 to 469.047, provided the occupant's income is no greater
than 80 percent of the county or area median income, adjusted
for family size, and the building consists of two or less
dwelling units. The lease agreement must provide for a portion
of the lease payment to be escrowed as a nonrefundable down
payment on the housing. The administering agency shall verify
the occupants income eligibility and certify to the county
assessor that the occupant meets the income criteria under this
paragraph. To qualify under this clause, the taxpayer must
apply to the county assessor by May 30 of each year. For
purposes of this section, "qualifying buildings and
appurtenances" shall be defined as one or two unit residential
buildings which are unoccupied and have been abandoned and
boarded for at least six months.
Class 4d property has a class rate of two percent of market
value except that property classified under clause (3), shall
have the same class rate as class 1a property.
(e) Residential rental property that would otherwise be
assessed as class 4 property under paragraph (a); paragraph (b),
clauses (1) and (3); 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 2.3 percent of market value
if it is found to be a substandard building under section
273.1316.
(f) Class 4e property consists of the residential portion
of any structure located within a city that was converted from
nonresidential use to residential use, provided that:
(1) the structure had formerly been used as a warehouse;
(2) the structure was originally constructed prior to 1940;
(3) the conversion was done after December 31, 1995, but
before January 1, 2003; and
(4) the conversion involved an investment of at least
$25,000 per residential unit.
Class 4e property has a class rate of 2.3 percent, provided
that a structure is eligible for class 4e classification only in
the 12 assessment years immediately following the conversion.
Sec. 13. Minnesota Statutes 1995 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 local tax rates.
(c) "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 aid payable in 1996 the class rate
applicable to all class 4a shall be 3.4 percent; and (ii)
estimated market values for the assessment two years prior to
that in which aid is payable. "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), (2), and (3), 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.
(d) "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.
(e) (d) "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) (e) "Equalized school levies" means the amounts levied
for:
(1) general education under section 124A.23, subdivision 2;
(2) supplemental revenue under section 124A.22, subdivision
8a;
(3) capital expenditure facilities revenue under section
124.243, subdivision 3 transition revenue under section 124A.22,
subdivision 13c;
(4) capital expenditure equipment revenue under section
124.244, subdivision 2;
(5) basic transportation under section 124.226, subdivision
1; and
(6) (5) referendum revenue under section 124A.03.
(g) (f) "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 total previous net tax capacity of the
unique taxing jurisdiction.
(h) (g) 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," "gross
taxes," or "taxes levied" means the total net tax capacity based
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" 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.
"Taxes levied" excludes equalized school levies.
(i) "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;
(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) (h) "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 number of households
for the third most recent year. The household adjustment factor
cannot be less than one.
(k) (i) "Growth adjustment factor" means the household
adjustment factor in the case of counties. In the case of
cities, towns, school districts, and special taxing districts,
the growth adjustment factor equals one. The growth adjustment
factor cannot be less than one.
(l) For aid payable in 1992 and subsequent years, (j)
"Homestead and agricultural credit base" means the previous
year's certified homestead and agricultural credit aid
determined under subdivision 2 less any permanent aid reduction
in the previous year to homestead and agricultural credit aid
under section 477A.0132, plus, for aid payable in 1992, fiscal
disparity homestead and agricultural credit aid under
subdivision 2b.
(m) (k) "Net tax capacity adjustment" means (1) the total
previous net tax capacity minus the total net tax capacity tax
base differential defined in subdivision 1a, multiplied by (2)
the unique taxing jurisdiction's current local tax rate. The
net tax capacity adjustment cannot be less than zero.
(n) (l) "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 tax base differential percent
referenced in subdivision 1a for 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.
Sec. 14. Minnesota Statutes 1994, section 273.1398, is
amended by adding a subdivision to read:
Subd. 1a. [TAX BASE DIFFERENTIAL.] (a) For aids payable in
1997, the tax base differential is 0.25 percent of the
assessment year 1995 taxable market value of class 4c
noncommercial seasonal recreational residential property up to
$72,000.
(b) For aids payable in 1998, the tax base differential is
0.25 percent of the assessment year 1996 taxable market value of
class 4c noncommercial seasonal recreational residential
property up to $72,000.
Sec. 15. Minnesota Statutes 1994, section 273.1398,
subdivision 4, is amended to read:
Subd. 4. [DISPARITY REDUCTION CREDIT.] (a) Beginning with
taxes payable in 1989, class 4a, class 3a, and class 3b property
qualifies for a disparity reduction credit if: (1) the property
is located in a border city that has an enterprise zone
designated pursuant to section 469.168, subdivision 4; (2) the
property is located in a city with a population greater than
2,500 and less than 35,000 according to the 1980 decennial
census; (3) the city is adjacent to a city in another state or
immediately adjacent to a city adjacent to a city in another
state; and (4) the adjacent city in the other state has a
population of greater than 5,000 and less than 75,000.
(b) The credit is an amount sufficient to reduce (i) the
taxes levied on class 4a property to three 2.3 percent of the
property's market value and (ii) the tax on class 3a and class
3b property to 3.3 percent of market value.
(c) The county auditor shall annually certify the costs of
the credits to the department of revenue. The department shall
reimburse local governments for the property taxes foregone as
the result of the credits in proportion to their total levies.
Sec. 16. Minnesota Statutes 1995 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 after November 10 and on or before November 24 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 and,
for a town, the amount of its final levy. It must clearly state
that each taxing authority, including regional library districts
established under section 134.201, and including the
metropolitan taxing districts as defined in paragraph (i), but
excluding all other special taxing districts and towns, 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 current budget and 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.
(d) The notice must state for each parcel:
(1) the market value of the property as determined under
section 273.11, and used for computing property taxes payable in
the following year and for taxes payable in the current year;
and, in the case of residential property, whether the property
is classified as homestead or nonhomestead. The notice must
clearly inform taxpayers of the years to which the market values
apply and that the values are final values;
(2) by county, city or town, school district excess
referenda levy, remaining school district levy, regional library
district, if in existence, the total of the metropolitan special
taxing districts as defined in paragraph (i) and the sum of the
remaining special taxing districts, and as a total of the taxing
authorities, including all 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. If a school district has certified under
section 124A.03, subdivision 2, that a referendum will be held
in the school district at the November general election, the
county auditor must note next to the school district's proposed
amount that a referendum is pending and that, if approved by the
voters, the tax amount may be higher than shown on the notice.
For the purposes of this subdivision, "school district excess
referenda levy" means school district taxes for operating
purposes approved at referendums, including those taxes based on
net tax capacity as well as those based on market value.
"School district excess referenda levy" does not include school
district taxes for capital expenditures approved at referendums
or school district taxes to pay for the debt service on bonds
approved at referenda. In the case of the city of Minneapolis,
the levy for the Minneapolis library board and the levy for
Minneapolis park and recreation shall be listed separately from
the remaining amount of the city's levy. In the case of a
parcel where tax increment or the fiscal disparities areawide
tax applies, the proposed tax levy on the captured value or the
proposed tax levy on the tax capacity subject to the areawide
tax must each be stated separately and not included in the sum
of the special taxing districts; 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.
(e) 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;
(4) amounts necessary to pay tort judgments against the
taxing authority that become final after the date the proposed
taxes are certified; and
(5) the contamination tax imposed on properties which
received market value reductions for contamination.
(f) Except as provided in subdivision 7, failure of the
county auditor to prepare or the county treasurer to deliver the
notice as required in this section does not invalidate the
proposed or final tax levy or the taxes payable pursuant to the
tax levy.
(g) If the notice the taxpayer receives under this section
lists the property as nonhomestead and the homeowner provides
satisfactory documentation to the county assessor that the
property is owned and has been used as the owner's homestead
prior to June 1 of that year, the assessor shall reclassify the
property to homestead for taxes payable in the following year.
(h) In the case of class 4 residential property used as a
residence for lease or rental periods of 30 days or more, the
taxpayer must either:
(1) mail or deliver a copy of the notice of proposed
property taxes to each tenant, renter, or lessee; or
(2) post a copy of the notice in a conspicuous place on the
premises of the property.
The notice must be mailed or posted by the taxpayer by
November 27 or within three days of receipt of the notice,
whichever is later. A taxpayer may notify the county treasurer
of the address of the taxpayer, agent, caretaker, or manager of
the premises to which the notice must be mailed in order to
fulfill the requirements of this paragraph.
(i) For purposes of this subdivision, subdivisions 5a and
6, "metropolitan special taxing districts" means the following
taxing districts in the seven-county metropolitan area that levy
a property tax for any of the specified purposes listed below:
(1) metropolitan council under section 473.132, 473.167,
473.249, 473.325, 473.446, 473.521, 473.547, or 473.834;
(2) metropolitan airports commission under section 473.667,
473.671, or 473.672; and
(3) metropolitan mosquito control commission under section
473.711.
For purposes of this section, any levies made by the
regional rail authorities in the county of Anoka, Carver,
Dakota, Hennepin, Ramsey, Scott, or Washington under chapter
398A shall be included with the appropriate county's levy and
shall be discussed at that county's public hearing.
Sec. 17. Minnesota Statutes 1994, section 275.065,
subdivision 5a, is amended to read:
Subd. 5a. [PUBLIC ADVERTISEMENT.] (a) A city that has a
population of more than 1,000 2,500, county, a metropolitan
special taxing district as defined in subdivision 3, paragraph
(i), a regional library district established under section
134.201, 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, to review its current budget
and proposed property taxes payable in the following year, at a
public hearing. The notice must be published not less than two
business days nor more than six business days before the hearing.
The advertisement must be at least one-eighth page in size
of a standard-size or a tabloid-size newspaper. 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.
For purposes of this section, the metropolitan special
taxing district's advertisement must only be published in the
Minneapolis Star and Tribune and the Saint Paul Pioneer Press.
(b) The advertisement must be in the following form, except
that the notice for a school district may include references to
the current budget in regard to proposed property taxes.
"NOTICE OF
PROPOSED PROPERTY TAXES
(City/County/School District/Metropolitan
Special Taxing District/Regional
Library District) of .........
The governing body of ........ will soon hold budget hearings
and vote on the property taxes for (city/county/metropolitan
special taxing district/regional library district services that
will be provided in 199_/school district services that will be
provided in 199_ and 199_).
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/metropolitan special taxing district/regional library
district) budget and property taxes, or in the case of a school
district, its current budget and proposed property taxes,
payable in the following year. The hearing will be held on
(Month/Day/Year) at (Time) at (Location, Address)."
(c) A city with a population of 1,000 or less over 500 but
not more than 2,500 must advertise by posted notice as defined
in section 645.12, subdivision 1. The advertisement must be
posted at the time provided in paragraph (a). It must be in the
form required in paragraph (b).
(d) For purposes of this subdivision, the population of a
city is the most recent population as determined by the state
demographer under section 4A.02.
(e) The commissioner of revenue, subject to the approval of
the chairs of the house and senate tax committees, shall
prescribe the form and format of the advertisement.
(f) For calendar year 1993, each taxing authority required
to publish an advertisement must include on the advertisement a
statement that information on the increases or decreases of the
total budget, including employee and independent contractor
compensation in the prior year, current year, and proposed
budget year will be discussed at the hearing.
(g) Notwithstanding paragraph (f), for 1993, the
commissioner of revenue shall prescribe the form, format, and
content of an advertisement comparing current and proposed
expense budgets for the metropolitan council, the metropolitan
airports commission, and the metropolitan mosquito control
commission. The expense budget must include occupancy,
personnel, contractual and capital improvement expenses. The
form, format, and content of the advertisement must be approved
by the chairs of the house and senate tax committees prior to
publication.
Sec. 18. Minnesota Statutes 1995 Supplement, section
275.065, subdivision 6, is amended to read:
Subd. 6. [PUBLIC HEARING; ADOPTION OF BUDGET AND LEVY.]
Between November 29 and December 20, the governing bodies of the
a city that has a population over 500, county, metropolitan
special taxing districts as defined in subdivision 3, paragraph
(i), and regional library districts shall each hold a public
hearing to discuss and seek public comment on 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 review its current budget and proposed
property tax levy for taxes payable in the following year. The
metropolitan special taxing districts shall be required to hold
only a single joint public hearing, the location of which will
be determined by the affected metropolitan agencies.
At a subsequent hearing, each county, school district,
city, and metropolitan special taxing district may amend its
proposed property tax levy and must adopt a final property tax
levy. Each county, city, and metropolitan special taxing
district may also amend its proposed budget and must adopt a
final budget at the subsequent hearing. A school district is
not required to adopt its final budget at the subsequent
hearing. The subsequent hearing of a taxing authority must be
held on a date subsequent to the date of the taxing authority's
initial public hearing, or subsequent to the date of its
continuation hearing if a continuation hearing is held. The
subsequent hearing may be held at a regularly scheduled board or
council meeting or at a special meeting scheduled for the
purposes of the subsequent hearing. The subsequent hearing of a
taxing authority does not have to be coordinated by the county
auditor to prevent a conflict with an initial hearing, a
continuation hearing, or a subsequent hearing of any other
taxing authority. All subsequent hearings must be held prior to
five working days after December 20 of the levy year.
The time and place of the subsequent hearing must be
announced at the initial public hearing or at the continuation
hearing.
The property tax levy certified under section 275.07 by a
city, county, metropolitan special taxing district, regional
library district, 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 124.82,
subdivision 3, 124A.03, subdivision 2, 124B.03, subdivision 2,
or 136C.411, after the proposed levy was certified;
(2) the amount of a city or county levy approved by the
voters 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;
(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;
(6) the amount of an increase in levy limits certified to
the taxing authority by the commissioner of children, families,
and learning after the proposed levy was certified; and
(7) the amount required under section 124.755.
At the hearing under this subdivision, 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. At the subsequent hearing held as
provided in this subdivision, the governing body, other than the
governing body of a school district, shall adopt its final
property tax levy prior to adopting its final budget.
If the hearing is not completed on its scheduled date, the
taxing authority must announce, prior to adjournment of the
hearing, the date, time, and place for the continuation of the
hearing. The continued hearing must be held at least five
business days but no more than 14 business days after the
original hearing.
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 governing body of a county shall hold a hearing on the
second Tuesday in December each year, and may hold additional
hearings on other dates before December 20 if necessary for the
convenience of county residents. If the county needs a
continuation of its hearing, the continued hearing shall be held
on the third Tuesday in December. If the third Tuesday in
December falls on December 21, the county's continuation hearing
shall be held on Monday, December 20. The county auditor shall
provide for the coordination of hearing dates for all cities and
school districts within the county.
The metropolitan special taxing districts shall hold a
joint public hearing on the first Monday of December. A
continuation hearing, if necessary, shall be held on the second
Monday of December.
By August 10, each school board and the board of the
regional library district shall certify to the county auditors
of the counties in which the school district or regional library
district is located the dates on which it elects to hold its
hearings and any continuations. If a school board or regional
library district does not certify the dates by August 10, the
auditor will assign the hearing date. The dates elected or
assigned must not conflict with the hearing dates of the county
or the metropolitan special taxing districts. By August 20, the
county auditor shall notify the clerks of the cities within the
county of the dates on which school districts and regional
library 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. For its initial hearing and for the
subsequent hearing at which the final property tax levy will be
adopted, the city must not select dates that conflict with the
county hearing dates, metropolitan special taxing district
dates, or with those elected by or assigned to the school
districts or regional library district in which the city is
located. For continuation hearings, the city may select dates
that conflict with other taxing authorities' dates if the city
deems it necessary.
The county hearing dates and the city, metropolitan special
taxing district, regional library district, and school district
hearing dates must be designated on the notices required under
subdivision 3. The continuation dates need not be stated on the
notices.
This subdivision does not apply to towns and special taxing
districts other than regional library districts and metropolitan
special taxing districts.
Notwithstanding the requirements of this section, the
employer is required to meet and negotiate over employee
compensation as provided for in chapter 179A.
Sec. 19. Minnesota Statutes 1994, section 275.07,
subdivision 4, is amended to read:
Subd. 4. [REPORT TO COMMISSIONER.] On or before September
30 for taxes payable in 1994, and thereafter October 8 of each
year, the county auditor shall report to the commissioner of
revenue the proposed levy certified by local units of government
under section 275.065, subdivision 1. On or before January 15,
for taxes levied in 1989 and thereafter of each year, the county
auditor shall report to the commissioner of revenue the final
levy certified by local units of government under subdivision
1. The levies must be reported in the manner prescribed by the
commissioner. The reports must show a total levy and the amount
of each special levy.
Sec. 20. Minnesota Statutes 1995 Supplement, section
275.08, subdivision 1b, is amended to read:
Subd. 1b. [COMPUTATION OF TAX RATES.] The amounts
certified to be levied against net tax capacity under section
275.07 by an individual local government unit, except for any
amounts certified under sections 124A.03, subdivision 2a, and
275.61, shall be divided by the total net tax capacity of all
taxable properties within the local government unit's taxing
jurisdiction. The resulting ratio, the local government's local
tax rate, multiplied by each property's net tax capacity shall
be each property's net tax capacity tax for that local
government unit before reduction by any credits.
Any amount certified to the county auditor under section
124A.03, subdivision 2a, or 275.61, after the dates given in
those sections, to be levied against market value shall be
divided by the total estimated referendum market value of all
taxable properties within the taxing district. The resulting
ratio, the taxing district's new referendum tax rate, multiplied
by each property's estimated referendum market value shall be
each property's new referendum tax before reduction by any
credits. For the purposes of this subdivision, "referendum
market value" means the market value as defined in section
124A.02, subdivision 3b.
Sec. 21. Minnesota Statutes 1994, section 275.61, is
amended to read:
275.61 [REFERENDUM LEVY; MARKET VALUE.]
For local governmental subdivisions other than school
districts, any levy, including the issuance of debt obligations
payable in whole or in part from property taxes, required to be
approved and approved by the voters at a general or special
election for taxes payable in 1993 and thereafter, shall be
levied against the referendum market value of all taxable
property within the governmental subdivision, as defined in
section 124A.02, subdivision 3b. Any levy amount subject to the
requirements of this section shall be certified separately to
the county auditor under section 275.07.
The ballot shall state the maximum amount of the increased
levy as a percentage of market value and the amount that will be
raised by the new referendum tax rate in the first year it is to
be levied.
Sec. 22. [276.017] [TIMELY PAYMENTS.]
Subdivision 1. [DATE OF MAILING OR RECEIPT.] When a
payment described in this section is required to be made to a
county on or before the prescribed date, the payment is timely
if received by the county on or before a prescribed date, or if
mailed on or before that date. This section applies to the
payment of current or delinquent real or personal property
taxes, any other amount shown as payable on a property tax
statement, and all related penalties, interest, or costs.
Subd. 2. [MAILING REQUIREMENTS.] Mailing is timely under
this section only if the payment was deposited in the mail in
the United States on or before the due date, in an envelope or
other appropriate wrapper, postage prepaid, and properly
addressed.
Subd. 3. [UNITED STATES POSTAL SERVICE POSTMARK.] The
postmark of the United States Postal Service qualifies as proof
of timely mailing for this section. If the payment is sent by
United States registered mail, the date of registration is the
postmark date. If the payment is sent by United States
certified mail, the date of the United States Postal Service
postmark on the receipt given to the person presenting the
payment for delivery is the date of mailing. Mailing, or the
time of mailing, may also be established by other available
evidence except that the postmark of a private postage meter may
not be used as proof of a timely mailing made under this section.
Subd. 4. [RECEIPT OTHERWISE GOVERNS.] In any case in which
the payment is not treated as timely mailed under this section,
the date of receipt governs for purposes of determining the
amount of any penalty, interest, or cost assessment.
Sec. 23. Minnesota Statutes 1995 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, the total of the
metropolitan special taxing districts as defined in section
275.065, subdivision 3, paragraph (i), school district excess
referenda levy, remaining school district levy, and the total of
other voter approved referenda levies based on market value
under section 275.61 must be separately stated. The amounts due
all other special taxing districts, if any, may be aggregated.
For the purposes of this subdivision, "school district excess
referenda levy" means school district taxes for operating
purposes approved at referenda, including those taxes based on
net tax capacity as well as those based on market value.
"School district excess referenda levy" does not include school
district taxes for capital expenditures approved at referendums
or school district taxes to pay for the debt service on bonds
approved at referenda. The amount of the tax on contamination
value imposed under sections 270.91 to 270.98, if any, must also
be separately stated. 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 amount of market value excluded under
section 273.11, subdivision 16, if any, must also be listed on
the tax statement. 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 under section
273.11, subdivision 1;
(2) the property's taxable market value after reductions
under section 273.11, subdivisions 1a and 16;
(3) the property's gross tax, calculated by multiplying the
property's gross tax capacity times the total local tax rate and
adding to the result the sum of the aids enumerated in clause
(3);
(4) 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;
(5) for homestead residential and agricultural properties,
the homestead and agricultural credit aid apportioned to the
property. This amount is obtained by multiplying the total
local tax 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;
(6) any credits received under sections 273.119; 273.123;
273.135; 273.1391; 273.1398, subdivision 4; 469.171; and
473H.10, except that the amount of credit received under section
273.135 must be separately stated and identified as "taconite
tax relief"; and
(7) the net tax payable in the manner required in paragraph
(a).
(d) If the county uses envelopes for mailing property tax
statements and if the county agrees, a taxing district may
include a notice with the property tax statement notifying
taxpayers when the taxing district will begin its budget
deliberations for the current year, and encouraging taxpayers to
attend the hearings. If the county allows notices to be
included in the envelope containing the property tax statement,
and if more than one taxing district relative to a given
property decides to include a notice with the tax statement, the
county treasurer or auditor must coordinate the process and may
combine the information on a single announcement.
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, 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.
Sec. 24. Minnesota Statutes 1994, section 278.01, is
amended by adding a subdivision to read:
Subd. 4. [FILING OF APPEAL DEADLINE;
EXCEPTION.] Notwithstanding the March 31 date in subdivision 1,
whenever the exempt status, valuation, or classification of real
or personal property is changed other than by an abatement or a
court decision, and the owner responsible for payment of the tax
is not given notice of the change until after January 31 of the
year the tax is payable or after July 1 in the case of property
subject to section 273.125, subdivision 4, an eligible
petitioner, as defined and limited in subdivision 1, has 60 days
from the date of mailing of the notice to initiate an appeal of
the property's exempt status, classification, or valuation
change under this chapter.
Sec. 25. Minnesota Statutes 1994, section 278.08, is
amended to read:
278.08 [INTEREST.]
Subdivision 1. [INTEREST; PENALTY.] In the case of real or
personal property, the judgment must include the following
interest:
(1) if the tax is sustained in full, interest on the unpaid
part of the tax computed under section 279.03, subdivision 1, at
the rate provided in section 549.09;
(2) if the tax is increased, interest on the unpaid part of
the tax as originally assessed computed under section 279.03,
subdivision 1, at the rate provided in section 549.09;
(3) if the tax is reduced, interest on the difference
between the tax as recomputed and the amount previously paid
computed under section 279.03, subdivision 1, at the rate
provided in section 549.09.
If the tax is sustained or increased, penalty on the unpaid
part of the tax as originally assessed computed under section
279.01 must be included in the judgment.
Subd. 2. [REFUND.] In the case of real or personal
property, if the petitioner has overpaid the tax determined or
stipulated to be due, the county auditor shall compute interest
on the overpayment from the date of the filing of the petition
for review or from the date of payment of the tax, whichever is
later, until the date of issuance of the refund warrant.
Interest shall be calculated on the overpayment under section
279.03, subdivision 1, at the rate provided in section 279.03
549.09 for delinquent property taxes originally due and payable
in the same year as the tax which was became or remained
overpaid. For the purposes of computing interest due under this
subdivision, an overpayment occurs on the date when the
cumulative total of the payments made by the taxpayer for the
payable year exceed the final total tax amount determined for
that payable year. In determining whether an overpayment has
occurred, taxpayer payments are allocated first to any penalty
imposed due to late payment of installments, then to the tax due.
Sec. 26. Minnesota Statutes 1994, section 279.06,
subdivision 1, is amended to read:
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, subdivisions 22, paragraph (c), and 25, paragraph (c),
clause (5), in which event the period of redemption is five
years from the date of sale to the state of Minnesota;
(d) abandoned property and pursuant to section 281.173 a
court order has been entered shortening the redemption period to
five weeks; or
(e) vacant property as described under section 281.174,
subdivision 2, and for which a court order is entered shortening
the redemption period under section 281.174.
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.
Sec. 27. Minnesota Statutes 1994, section 279.37, is
amended by adding a subdivision to read:
Subd. 11. This section shall not apply in cases where the
redemption period has been shortened under sections 281.173 and
281.174.
Sec. 28. Minnesota Statutes 1994, section 281.17, is
amended to read:
281.17 [PERIOD FOR REDEMPTION.]
Except for properties for which the period of redemption
has been limited under sections 281.173 and 281.174, the
following periods for redemption apply.
The period of redemption for all lands sold to the state at
a tax judgment sale shall be three years from the date of sale
to the state of Minnesota if the land is within an incorporated
area unless it is: (a) nonagricultural homesteaded land as
defined in section 273.13, subdivision 22; (b) homesteaded
agricultural land as defined in section 273.13, subdivision 23,
paragraph (a); or (c) seasonal recreational land as defined in
section 273.13, subdivision 22, paragraph (c), or 25, paragraph
(c), clause (5), for which 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 three
years from the date of sale. The period of redemption for all
lands located in a targeted neighborhood as defined in Laws
1987, chapter 386, article 6, section 4, except (1) homesteaded
lands as defined in section 273.13, subdivision 22, and (2) for
periods of redemption beginning after June 30, 1991, but before
July 1, 1996, lands located in the Loring Park targeted
neighborhood on which a notice of lis pendens has been served,
and sold to the state at a tax judgment sale is one year from
the date of sale.
The period of redemption for all real property constituting
a mixed municipal solid waste disposal facility that is a
qualified facility under section 115B.39, subdivision 1, is one
year from the date of the 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, except that the period of redemption for nonhomesteaded
agricultural land as defined in section 273.13, subdivision 23,
paragraph (b), shall be two years from the date of sale if at
that time that property is owned by a person who owns one or
more parcels of property on which taxes are delinquent, and the
delinquent taxes are more than 25 percent of the prior year's
school district levy.
Sec. 29. [281.173] [FIVE-WEEK REDEMPTION PERIOD FOR
CERTAIN ABANDONED PROPERTIES.]
Subdivision 1. [APPLICATION.] This section applies if at
any time after the tax sale as provided in section 280.01 has
occurred but before notice of expiration of time for redemption
has been given, a court order is entered reducing to five weeks
the redemption period during which the owner, the owner's
personal representatives and assigns, or any other person
holding an interest in the premises, may redeem the premises in
accordance with the provisions of this chapter.
Subd. 2. [SUMMONS AND COMPLAINT.] Any city, housing and
redevelopment authority, port authority, or economic development
authority, in which the premises are located may commence an
action in district court to reduce the period otherwise allowed
for redemption under this chapter. The action must be commenced
by the filing of a complaint, naming as defendants the record
fee owners or the owner's personal representative, or the
owner's heirs as determined by a court of competent
jurisdiction, contract for deed purchasers, mortgagees, assigns
of any of the above, the taxpayers as shown on the records of
the county auditor, the Internal Revenue Service of the United
States and the revenue department of the state of Minnesota if
tax liens against the owners or contract for deed purchasers
have been recorded or filed; and any other person the plaintiff
determines should be made a party. The action shall be filed in
district court for the county in which the premises are
located. The complaint must identify the premises by legal
description. The complaint must allege (1) that the premises
are abandoned, (2) that the tax judgment sale pursuant to
section 280.01 has been made, and (3) notice of expiration of
the time for redemption has not been given.
The complaint must request an order reducing the redemption
period to five weeks. When the complaint has been filed, the
court shall issue a summons commanding the person or persons
named in the complaint to appear before the court on a day and
at a place stated in the summons. The appearance date shall be
not less than 15 nor more than 25 days from the date of the
issuing of the summons. A copy of the filed complaint must be
attached to the summons.
Subd. 3. [SERVICE OF SUMMONS AND COMPLAINT.] The summons
and complaint may be served by any person not named a party to
the action. The summons and complaint must be served at least
seven days before the appearance date, in the manner provided
for service of a summons and complaint in a civil action in the
district court, and posted in a conspicuous place on the
premises. If a defendant cannot be found in the state, then
upon an affidavit to that effect being filed with the court, the
summons and complaint may be served by sending a copy by
certified mail to the defendant's last known address, if any, at
least ten days before the appearance date. Summons by certified
mail is complete upon mailing. If personal or certified mail
service cannot be made on a defendant, then the plaintiff or
plaintiff's attorney may file an affidavit to that effect with
the court and service by posting the summons and complaint on
the premises is sufficient as to that defendant. Service upon
the United States of America shall be made in accordance with
applicable federal law.
Subd. 4. [HEARING; EVIDENCE; ORDER.] At the hearing on the
summons and complaint, the court shall enter an order reducing
the redemption period to five weeks from the date of the order,
if evidence is presented supporting the allegations in the
complaint and no appearance is made to oppose the relief
sought. An affidavit by the sheriff or a deputy sheriff of the
county in which the premises are located, or of a building
inspector, zoning administrator, housing official, or other
municipal or county official having jurisdiction over the
premises, stating that the premises are not actually lawfully
occupied and further setting forth any of the following
supporting facts, is prima facie evidence of abandonment:
(1) windows or entrances to the premises are boarded up or
closed off, or multiple window panes are broken and unrepaired;
(2) doors to the premises are smashed through, broken off,
unhinged, or continuously unlocked;
(3) gas, electric, or water service to the premises has
been terminated;
(4) rubbish, trash, or debris has accumulated on the
premises;
(5) the police or sheriff's office has received at least
two reports of trespassers on the premises, or of vandalism or
other illegal acts being committed on the premises; or
(6) the premises are deteriorating and are either below or
are in imminent danger of falling below minimum community
standards for public safety and sanitation.
The court may consider an affidavit from any other person
having personal knowledge, which states facts supporting any
other allegations in the complaint. Written statements of the
owner, the owner's personal representatives or assigns,
including documents of conveyance, which indicate a clear intent
to abandon the premises, are conclusive evidence of abandonment.
In the absence of affidavits or written statements, or if
rebuttal evidence is offered by the defendant or a party
lawfully claiming an interest through the defendant, the court
may consider any competent evidence, including oral testimony,
concerning any allegations in the complaint. An order entered
under this section must contain specific findings of abandonment
and must contain a legal description of the premises.
Subd. 5. [RECORDING AND SERVICE OF ORDER.] Within ten days
after the order is entered, a certified copy of the order must
be filed by the moving party with the office of the county
recorder or registrar of titles and with the auditor for the
county in which the premises are located. Failure to file the
order within ten days shall not invalidate the proceedings.
Subd. 6. [DUTY OF AUDITOR.] If the property is not
redeemed within five weeks of the date of entry of the order the
county auditor, without further notice, shall execute a
certificate as provided for in section 281.23, subdivision 9.
Subd. 7. [HOMESTEAD STATUS.] This section applies
regardless of the subject property's homestead tax status at the
time of sale.
Subd. 8. [EFFECTIVE DATE.] This section shall apply only
to tax judgment sales occurring on and after the effective date,
which shall be the day following final enactment.
Sec. 30. [281.174] [FIVE-WEEK REDEMPTION PERIOD FOR
CERTAIN VACANT PROPERTIES.]
Subdivision 1. [APPLICATION.] This section applies to
property located within a city if at any time after the tax sale
as provided in section 280.01 has occurred but before notice of
expiration of time for redemption has been given, a court order
is entered reducing to five weeks the redemption period on
property under subdivision 2 during which the owner, the owner's
personal representatives and assigns, or any other person
holding an interest in the property, may redeem that property in
accordance with the provisions of this chapter.
Subd. 2. [VACANT PROPERTY SUBJECT TO FIVE-WEEK REDEMPTION
PERIOD.] Only property that meets all of the following criteria
is subject to the five-week redemption period as provided in
this section:
(1) the property is located in a targeted neighborhood
revitalization program under section 469.201;
(2) no structures are located on the land;
(3) the property is classified under section 273.13 as
residential; and
(4) a residential structure existed on the land within the
last five years.
Subd. 3. [SUMMONS AND COMPLAINT.] Any city, housing and
redevelopment authority, port authority, or economic development
authority in which the property is located may commence an
action in district court to reduce the period otherwise allowed
for redemption under this chapter from the date of the requested
order. The action must be commenced by the filing of a
complaint, naming as defendants the record fee owners or the
owner's personal representative, or the owner's heirs as
determined by a court of competent jurisdiction, contract for
deed purchasers, mortgagees, assigns of any of the above, the
taxpayers as shown on the records of the county auditor, the
Internal Revenue Service of the United States and the revenue
department of the state of Minnesota if tax liens against the
owners or contract for deed purchasers have been recorded or
filed, and any other person the plaintiff determines should be
made a party. The action shall be filed in district court for
the county in which the property is located. The complaint must
identify the property by legal description. The complaint must
allege (1) that the property is vacant, (2) that the tax
judgment sale under section 280.01 has been made, and (3) notice
of expiration of the time for redemption has not been given.
The complaint must request an order reducing the redemption
period to five weeks. When the complaint has been filed, the
court shall issue a summons commanding the person or persons
named in the complaint to appear before the court on a day and
at a place stated in the summons. The appearance date shall be
not less than 15 nor more than 25 days from the date of the
issuing of the summons, except that, when the United States of
America is a party, the date shall be set in accordance with
applicable federal law. A copy of the filed complaint must be
attached to the summons.
Subd. 4. [SERVICE OF SUMMONS AND COMPLAINT.] The summons
and complaint may be served by any person not named a party to
the action. The summons and complaint must be served at least
seven days before the appearance date, in the manner provided
for service of a summons and complaint in a civil action in the
district court, and posted in a conspicuous place on the
property. If a defendant cannot be found in the state, then
upon an affidavit to that effect being filed with the court, the
summons and complaint may be served by sending a copy by
certified mail to the defendant's last known address, if any, at
least ten days before the appearance date. Summons by certified
mail is complete upon mailing. If personal or certified mail
service cannot be made on a defendant, then the plaintiff or
plaintiff's attorney may file an affidavit to that effect with
the court and service by posting the summons and complaint on
the premises is sufficient as to that defendant.
Subd. 5. [HEARING; EVIDENCE; ORDER.] At the hearing on the
summons and complaint, the court shall enter an order reducing
the redemption period to five weeks from the date of the order,
if evidence is presented supporting the allegations in the
complaint and no appearance is made to oppose the relief
sought. An affidavit from any person having personal knowledge
about the property may be filed stating facts supporting any
allegations in the complaint. In the absence of affidavits or
written statements, or if rebuttal evidence is offered by the
defendant or a party lawfully claiming an interest through the
defendant, the court may consider any competent evidence,
including oral testimony, concerning any allegations in the
complaint. An order entered under this section must contain a
legal description of the property.
Subd. 6. [RECORDING AND SERVICE OF ORDER.] Within ten days
after the order is entered, a certified copy of the order must
be filed by the moving party with the office of the county
recorder or registrar of titles and with the auditor for the
county in which the property is located. Failure to file the
order within ten days shall not invalidate the proceedings.
Subd. 7. [DUTY OF AUDITOR.] If the property is not
redeemed within five weeks of the date of entry of the order the
county auditor, without further notice, shall execute a
certificate as provided for in section 281.23, subdivision 9.
Subd. 8. [EFFECTIVE DATE.] This section shall apply only
to tax judgment sales occurring on and after the effective date
which shall be the day following final enactment.
Sec. 31. Minnesota Statutes 1994, section 287.06, is
amended to read:
287.06 [EXEMPTION FROM OTHER TAXES.]
All mortgages upon which such tax has been paid, with the
debts or obligations secured thereby and the papers evidencing
the same, shall be exempt from all other taxes; but nothing
herein shall exempt such property from the operation of the laws
relating to the taxation of gifts and inheritances, or those
governing the taxation of banks, savings banks, or trust
companies; provided, that Sections 287.01 to 287.12 shall not
apply to mortgages taken in good faith by persons or
corporations whose personal property is expressly exempted from
taxation by law section 272.02, subdivision 1, clauses (1) to
(7), or is taxed upon the basis of gross earnings or other
methods of computation in lieu of all other taxes mortgagees
that are fraternal benefit societies subject to section 64B.24.
Sec. 32. [287.37] [INVESTIGATIONS AND ASSESSMENTS.]
The commissioner of revenue may investigate and examine
persons and transactions that are subject to this chapter using
the powers and authorities granted in chapters 270 and 289A.
The commissioner may issue orders of assessment under chapter
289A, and enforce collection of unpaid tax or penalty amounts,
including interest, under the authority of chapter 270. All tax
amounts collected by the commissioner must be apportioned under
section 287.12. The commissioner's expenses under this section
are not expenses of administration under section 287.33. All
data and information made available to the commissioner under
this section is public except for investigative data covered by
section 270B.03, subdivision 6.
Sec. 33. Minnesota Statutes 1995 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 12 percent over the net property
taxes payable in the prior year on the same property that is
owned and occupied by the same owner on January 2 of both years,
and the amount of that increase is $100 or more for taxes
payable in 1995 and 1996 and 1997, a claimant who is a homeowner
shall be allowed an additional refund equal to 60 percent of the
amount of the increase over the greater of 12 percent of the
prior year's net property taxes payable or $100 for taxes
payable in 1995 and 1996 and 1997. This subdivision shall not
apply to any increase in the gross property taxes payable
attributable to improvements made to the homestead after the
assessment date for the prior year's taxes. This subdivision
shall not apply to any increase in the gross property taxes
payable attributable to the termination of valuation exclusions
under section 273.11, subdivision 16.
The maximum refund allowed under this subdivision is $1,000.
(b) For purposes of this subdivision, the following terms
have the meanings given:
(1) "Net property taxes payable" means property taxes
payable minus 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.
(d) On or before December 1, 1995, the commissioner shall
estimate the cost of making the payments provided by this
subdivision for taxes payable in 1996. Notwithstanding the open
appropriation provision of section 290A.23, if the estimated
total refund claims for taxes payable in 1996 exceed $5,500,000,
the commissioner shall first reduce the 60 percent refund rate
enough, but to no lower a rate than 50 percent, so that the
estimated total refund claims do not exceed $5,500,000. If the
commissioner estimates that total claims will exceed $5,500,000
at a 50 percent refund rate, the commissioner shall also reduce
the $1,000 maximum refund amount by enough so that total
estimated refund claims do not exceed $5,500,000.
The determinations of the revised thresholds by the
commissioner are not rules subject to chapter 14.
(e) Upon request, the appropriate county official shall
make available the names and addresses of the property taxpayers
who may be eligible for the additional property tax refund under
this section. The information shall be provided on a magnetic
computer disk. The county may recover its costs by charging the
person requesting the information the reasonable cost for
preparing the data. The information may not be used for any
purpose other than for notifying the homeowner of potential
eligibility and assisting the homeowner, without charge, in
preparing a refund claim.
Sec. 34. Minnesota Statutes 1994, section 290A.25, is
amended to read:
290A.25 [VERIFICATION OF SOCIAL SECURITY NUMBERS.]
Annually, the commissioner of revenue shall furnish a list
to the county assessor containing the names and social security
numbers of persons who have applied for both homestead
classification under section 273.13 and a property tax refund as
a renter under this chapter.
Within 90 days of the notification, the county assessor
shall investigate to determine if the homestead classification
was improperly claimed. If the property owner does not qualify,
the county assessor shall notify the county auditor who will
determine the amount of homestead benefits that has been
improperly allowed. For the purpose of this section, "homestead
benefits" means the tax reduction resulting from the
classification as a homestead under section 273.13, and the
taconite homestead credit under section 273.1391 has the meaning
given in section 273.124, subdivision 13, paragraph (h). The
county auditor shall send a notice to persons who owned the
owners of affected property at the time the homestead
application related to the property improper homestead was
filed, demanding reimbursement of the homestead benefits plus a
penalty equal to 100 percent of the homestead benefits.
The property owners person notified may appeal the county's
determination by filing a notice of appeal with the Minnesota
tax court within 60 days of the date of the notice from the
county as provided in section 273.124, subdivision 13, paragraph
(h).
If the amount of homestead benefits and penalty is not paid
within 60 days, and if no appeal has been filed, the county
auditor shall certify the amount of taxes and penalty to the
succeeding year's tax list to be collected as part of the
property taxes county treasurer. The county treasurer will add
interest to the unpaid homestead benefits and penalty amounts at
the rate provided for delinquent personal property taxes for the
period beginning 60 days after demand for payment was made until
payment. If the person notified is the current owner of the
property, the treasurer may add the total amount of benefits,
penalty, interest, and costs to the real estate taxes otherwise
payable on the property in the following year. If the person
notified is not the current owner of the property, the treasurer
may collect the amounts due under the revenue recapture act in
chapter 270A, or use any of the powers granted in sections
277.20 and 277.21 without exclusion, to enforce payment of the
benefits, penalty, interest, and costs, as if those amounts were
delinquent tax obligations of the person who owned the property
at the time the application related to the improperly allowed
homestead was filed. The treasurer may relieve a prior owner of
personal liability for the benefits, penalty, interest, and
costs, and instead extend those amounts on the tax lists against
the property for taxes payable in the following year to the
extent that the current owner agrees in writing.
Any amount of homestead benefits recovered by the county
from the property owner shall be distributed to the county, city
or town, and school district where the property is located in
the same proportion that each taxing district's levy was to the
total of the three taxing districts' levy for the current year.
Any amount recovered attributable to taconite homestead credit
shall be transmitted to the St. Louis county auditor to be
deposited in the taconite property tax relief account. Any
amount recovered that is attributable to supplemental homestead
credit is to be transmitted to the commissioner of revenue for
deposit in the general fund of the state treasury. The total
amount of penalty collected must be deposited in the county
general fund.
Sec. 35. [290A.27] [ROUNDING.]
In computing the dollar amount of items on the property tax
refund claim form and accompanying schedules, items may be
rounded off to the nearest whole dollar amount, disregarding
amounts of less than 50 cents and increasing amounts of 50 cents
to 99 cents to the next highest dollar.
Sec. 36. Minnesota Statutes 1994, section 375.192,
subdivision 2, is amended to read:
Subd. 2. Upon written application by the owner of any
property, 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. Except as provided in section 375.194, the
county board is authorized to consider and grant reductions or
abatements on applications only as they relate to taxes payable
in the current year and the two prior years; provided that
reductions or abatements for the two prior years shall be
considered or granted only for (i) clerical errors, or (ii) when
the taxpayer fails to file for a reduction or an adjustment due
to hardship, as determined by the county board. 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. All applications 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, except that the part of the
application which is for the abatement of penalty or interest
must be approved by the county treasurer and county auditor.
Approval by the county or city assessor is not required for
abatements of penalty or interest. 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.
The county auditor shall notify the commissioner of revenue
of all abatements resulting from the erroneous classification of
real property, for tax purposes, as nonhomestead property. For
the abatements relating to the current year's tax processed
through June 30, the auditor shall notify the commissioner on or
before July 31 of that same year of all abatement applications
granted. For the abatements relating to the current year's tax
processed after June 30 through the balance of the year, the
auditor shall notify the commissioner on or before the following
January 31 of all applications granted. The county auditor
shall submit a form containing the social security number of the
applicant and such other information the commissioner prescribes.
Sec. 37. [375.194] [ECONOMIC DEVELOPMENT TAX ABATEMENT.]
Subdivision 1. [DEFINITIONS.] For purposes of this
section, the following terms have the meanings given them.
(a) "Eligible county" means a county whose county
government average tax rate is at least 45 points higher than an
adjacent neighboring county's county government average tax rate
in the initial year that the tax abatement is granted on the
eligible property. An eligible county cannot be one of the
seven metropolitan counties under section 473.121, subdivision 4.
(b) "Neighboring county" means a county whose average
county government tax rate is at least 45 points lower than the
average county government tax rate of an adjacent county that is
an eligible county, in the initial year that the tax abatement
is granted.
(c) "Eligible property" means property located in an
eligible county within 20 miles of the neighboring county and is
either (i) commercial property classified under section 273.13,
subdivision 24, whose estimated market value has increased by at
least $400,000 from improvements made on that property by the
taxpayer after January 2, 1996, or (ii) industrial property
classified under section 273.13, subdivision 24, whose estimated
market value has increased by at least $100,000 from
improvements made on that property by the taxpayer after January
2, 1996.
(d) "Improvements" means (i) new construction, and (ii)
rehabilitation, reconstruction, and additions to existing
structures.
(e) "Maximum tax abatement" for any given year means the
difference between (i) the eligible county's current year county
government tax rate times the net tax capacity of the eligible
property, and (ii) the neighboring county's current year county
government tax rate times the net tax capacity of the eligible
property.
(f) "Taxpayer" means the person who is responsible for
payment of the property tax, including a lessee who pays the
taxes on the eligible property.
Subd. 2. [ABATEMENT AUTHORITY.] The county board of an
eligible county may enter into a written agreement with the
taxpayer of eligible property to grant a property tax abatement
to the taxpayer. The agreement must specify the percentage of
the maximum tax abatement to be granted for each of the
designated tax abatement years. The agreement must not provide
a property tax abatement for any given year that exceeds the
maximum tax abatement under subdivision 1, paragraph (e). The
maximum length of the agreement is ten years. Even if the
difference in the two county average tax rates in any given year
is less than the required 45-point minimum, the agreement shall
remain in effect for its duration. The agreement is binding
unless both the eligible county's county board and the taxpayer
mutually agree upon any changes in the agreement.
Subd. 3. [ABATEMENT CALCULATIONS.] The actual tax
abatement shall be computed annually by the county auditor of
the county in which the eligible property is located using (i)
the difference between the eligible county's current year
average county government tax rate and the neighboring county's
current year average county government tax rate, and (ii) the
percentage of the maximum tax abatement specified in the
agreement.
If the improvements are made over two calendar years, the
county board is allowed to grant the initial tax abatement based
on improvements of less than the $100,000 estimated market value
for industrial property and $400,000 estimated market value for
commercial property, provided that the county board has
finalized the agreement and is reasonably assured that the
minimum dollar requirements provided in subdivision 1 will be
met over the two-year time period. However, the agreement's
ten-year maximum time period begins with the year the first
abatement is granted.
Subd. 4. [PROPOSED AND FINAL PROPERTY TAX STATEMENTS.] For
purposes of determining the eligible property's taxes on the
proposed property tax statement under section 275.065, the
amount shown will be the amount before the deduction of the tax
abatement under subdivision 3. The property taxes shown on the
final property tax statement shall reflect both the taxes before
and after the tax abatement granted under this section.
Subd. 5. [DETERMINATION OF COUNTY TAX RATE.] The eligible
county's proposed and final tax rates shall be determined by
dividing the certified levy by the total taxable net tax
capacity, without regard to any abatements granted under this
section. The county board shall make available the estimated
amount of the abatement at the public hearing under section
275.065, subdivision 6.
Subd. 6. [ELIGIBLE PROPERTY LOCATED IN A TAX INCREMENT
FINANCING DISTRICT.] Eligible property may be located in a tax
increment financing district, provided that (i) the governing
body of the municipality containing the district approves the
written agreement under subdivision 2, and (ii) the county
treasurer, when making property tax settlements of the property
tax collected on eligible property, shall deduct the full amount
of the tax abatement granted to the eligible property under this
section from the property tax distribution made to the tax
increment financing district.
Sec. 38. Minnesota Statutes 1994, section 469.040, is
amended by adding a subdivision to read:
Subd. 4. [FACILITIES FUNDED FROM MULTIPLE SOURCES.] In the
metropolitan area, as defined in section 473.121, subdivision 2,
the tax treatment provided in subdivision 3 applies to that
portion of any multifamily rental housing facility represented
by the ratio of (1) the number of units in the facility that are
subject to the requirements of Section 5 of the United States
Housing Act of 1937, as the result of the implementation of a
federal court order or consent decree to (2) the total number of
units within the facility.
The housing and redevelopment authority for the city in
which the facility is located, any public entity exercising the
powers of such housing and redevelopment authority, or the
county housing and redevelopment authority for the county in
which the facility is located, shall annually certify to the
assessor responsible for assessing the facility, at the time and
in the manner required by the assessor, the number of units in
the facility that are subject to the requirements of Section 5
of the United States Housing Act of 1937.
Nothing in this subdivision shall prevent that portion of
the facility not subject to this subdivision from meeting the
requirements of section 273.1317, and for that purpose the total
number of units in the facility must be taken into account.
Sec. 39. Minnesota Statutes 1994, section 471.59, is
amended by adding a subdivision to read:
Subd. 13. [JOINT POWERS BOARD FOR HOUSING.] (a) For
purposes of implementing a federal court order or decree, two or
more housing and redevelopment authorities, or public entities
exercising the public housing powers of housing and
redevelopment authorities, may by adoption of a joint powers
agreement that complies with the provisions of subdivisions 1 to
5, establish a joint board for the purpose of acquiring an
interest in, rehabilitating, constructing, owning, or managing
low-rent public housing located in the metropolitan area, as
defined in section 473.121, subdivision 2, and financed, in
whole or in part, with federal financial assistance under
Section 5 of the United States Housing Act of 1937. The joint
board established pursuant to this subdivision shall:
(1) be composed of members designated by the governing
bodies of the governmental units which established such joint
board, and possess such representative and voting power provided
by the joint powers agreement;
(2) constitute a public body, corporate, and politic; and
(3) notwithstanding the provisions of subdivision 1,
requiring commonality of powers between parties to a joint
powers agreement, and solely for the purpose of acquiring an
interest in, rehabilitating, constructing, owning, or managing
federally financed low-rent public housing, shall possess all of
the powers and duties contained in sections 469.001 to 469.047
and, if at least one participant is an economic development
authority, sections 469.090 to 469.1081, except (i) as may be
otherwise limited by the terms of the joint powers agreement;
and (ii) a joint board shall not have the power to tax pursuant
to section 469.033, subdivision 6, or section 469.107, nor shall
it exercise the power of eminent domain. Every joint powers
agreement establishing a joint board shall specifically provide
which and under what circumstances the powers granted herein may
be exercised by that joint board.
(b) If a housing and redevelopment authority exists in a
city which intends to participate in the creation of a joint
board pursuant to paragraph (a), such housing and redevelopment
authority shall be the governmental unit which enters into the
joint powers agreement unless it determines not to do so, in
which event the governmental entity which enters into the joint
powers agreement may be any public entity of that city which
exercises the low-rent public housing powers of a housing and
redevelopment authority.
(c) A joint board shall not make any contract with the
federal government for low-rent public housing, unless the
governing body or bodies creating the participating authority in
whose jurisdiction the housing is located has, by resolution,
approved the provision of that low-rent public housing.
(d) This subdivision shall not apply to any housing and
redevelopment authority, or public entity exercising the powers
of a housing and redevelopment authority, within the
jurisdiction of a county housing and redevelopment authority
which is actively carrying out a public housing program under
Section 5 of the United States Housing Act of 1937. For
purposes of this paragraph, a county housing and redevelopment
authority shall be considered to be actively carrying out a
public housing program under Section 5 of the United States
Housing Act of 1937, if it (1) owns 200 or more public housing
units constructed under Section 5 of the United States Housing
Act of 1937, and (2) has applied for public housing development
funds under Section 5 of the United States Housing Act of 1937,
during the three years immediately preceding January 1, 1996.
(e) For purposes of sections 469.001 to 469.047, "city"
means the city in which the housing units with respect to which
the joint board was created are located and "governing body" or
"governing body creating the authority" means the council of
such city.
Sec. 40. Minnesota Statutes 1995 Supplement, section
471.6965, is amended to read:
471.6965 [PUBLICATION OF SUMMARY BUDGET STATEMENT.]
Annually, upon adoption of the city budget, the city
council shall publish a summary budget statement in either of
the following:
(1) the official newspaper of the city, or if there is
none, in a qualified newspaper of general circulation in the
city; or
(2) for a city in the metropolitan area as defined in
section 473.121, subdivision 2, a city newsletter or other city
mailing sent to all households in the city.
If the summary budget statement is published in a city
newsletter, it must be the lead story. If the summary budget
statement is published through a city newsletter or other city
mailing, a copy of the newsletter or mailing shall be sent on
request to any nonresident. If the summary budget statement is
published by a mailing to households other than a newsletter,
the color of the paper on which the summary budget statement is
printed must be distinctively different than the paper
containing other printed material included in the mailing.
If the budget statement is mailed to households, the city
may also include a notice notifying taxpayers when the city will
begin its budget process for the current year and encouraging
taxpayers to attend the hearings. A telephone number where
taxpayers can check on the dates and times of those future
hearings should be included.
The statement shall contain information relating to
anticipated revenues and expenditures, in a form prescribed by
the state auditor. The form prescribed shall be designed so
that comparisons can be made between the current year and the
budget year. A note shall be included that the complete budget
is available for public inspection at a designated location
within the city.
Sec. 41. Minnesota Statutes 1995 Supplement, section
473.448, is amended to read:
473.448 [COUNCIL; EXEMPTION FROM TAXATION TRANSIT ASSETS
EXEMPT FROM TAX BUT MUST PAY ASSESSMENTS.]
(a) Notwithstanding any other provision of law to the
contrary, the properties, moneys, and other assets of the
council used for transit operations or for special
transportation services and all revenues or other income from
the council's transit operations or special transportation
services shall be are exempt from all taxation, licenses, or
fees, or charges of any kind imposed by the state or by any
county, municipality, political subdivision, taxing district, or
other public agency or body of the state.
(b) Notwithstanding paragraph (a), the council's transit
properties are subject to special assessments levied by a
political subdivision for a local improvement in amounts
proportionate to and not exceeding the special benefit received
by the properties from the improvement.
Sec. 42. [APPLICATION.]
Section 41 applies in the counties of Anoka, Carver,
Dakota, Hennepin, Ramsey, Scott, and Washington.
Sec. 43. Minnesota Statutes 1994, section 473.625, is
amended to read:
473.625 [DETACHMENT OF CERTAIN MAJOR AIRPORTS LAND FROM
CITIES AND SCHOOL DISTRICTS.]
(a) Lands constituting any major airport or a part thereof
now and which may hereafter be operated by any public
corporation organized under sections 473.601 to 473.679, and
embraced within any city or school district organized under the
laws of the state, are hereby detached from such city or school
district.
(b)(i) Except as provided in clause (ii), real and personal
property, including real and personal property otherwise taxable
under section 272.01, constituting all or part of an
intermediate airport operated by a public corporation organized
under sections 473.601 to 473.679 and embraced within a home
rule charter or statutory city or school district is exempt from
taxation by the city or school district.
(ii) The county assessor of the county where the property
under this paragraph is located shall determine the total market
value for all property at that site for assessment year 2001,
compare it to the market value of the property existing on that
site for the 1996 assessment, and report those market values to
the commission. If the total market value has not increased by
at least 20 percent, the property tax exemption under clause (i)
shall expire and the property shall be taxable beginning in
assessment year 2001 and thereafter, for taxes payable in 2002
and thereafter. The provisions of section 473.629 apply to
lands exempted from property tax under this paragraph.
(c) For the purposes of this section, an intermediate
airport is an airport that as of March 14, 1996, is a primary
reliever airport, provides general aviation services, has a
primary runway between 5,001 and 8,000 feet in length, and has
precision instrument capability.
Sec. 44. Minnesota Statutes 1994, section 477A.011,
subdivision 3, is amended to read:
Subd. 3. [POPULATION.] "Population" means the population
established as of July 1 in an aid calculation year by the most
recent federal census, by a special census conducted under
contract with the United States Bureau of the Census, by a
population estimate made by the metropolitan council, or by a
population estimate of the state demographer made pursuant to
section 4A.02, whichever is the most recent as to the stated
date of the count or estimate for the preceding calendar year.
The term "per capita" refers to population as defined by this
subdivision.
Sec. 45. Minnesota Statutes 1995 Supplement, section
477A.0121, subdivision 4, is amended to read:
Subd. 4. [PUBLIC DEFENDER COSTS.] Each calendar year,
two 1.5 percent of the total appropriation for this section
shall be retained by the commissioner of revenue to make
reimbursements to the commissioner of finance for payments made
under section 611.27. The reimbursements shall be to defray the
additional costs associated with court-ordered counsel under
section 611.27. Any retained amounts not used for reimbursement
in a year shall be included in the next distribution of county
criminal justice aid that is certified to the county auditors
for the purpose of property tax reduction for the next taxes
payable year.
Sec. 46. Minnesota Statutes 1995 Supplement, section
477A.0132, is amended to read:
477A.0132 [AID REDUCTIONS TO LOCAL GOVERNMENTS.]
Subdivision 1. [AFFECTED LOCAL GOVERNMENTS.] The following
reductions shall be made in aids paid to the following local
units of government:
(a) For aids payable in 1996, there shall be a nonpermanent
reduction in aids to counties, cities, towns, and special taxing
districts of $16,000,000, provided that Laws 1995, chapter 264,
article 8, section 25, subdivision 1, is enacted; otherwise the
reduction is $14,000,000.
(b) Aid reductions required under section 16A.711,
subdivision 5, shall be nonpermanent reductions in aids to
counties, cities, towns, and special taxing districts equal to
the difference between the aid amounts certified to be paid and
the amount of the appropriation to pay the aids.
(c) For aids payable in 1996 there shall be a permanent
reduction in aids to counties of $10,000,000, provided that Laws
1995, chapter 264, article 8, section 16, is enacted.
(d) For aids payable in 1997 there shall be a permanent
reduction in aids to county regional rail authorities and
counties of $6,800,000, provided that section 45 is enacted.
Subd. 2. [CALCULATION OF AID REDUCTION.] The aid reduction
to each local government as provided under subdivision 1 will be
equal to the product of the reduction percentage and its
reduction base. The reduction base is defined as the following:
(a) For subdivision 1, clause (a), the reduction base is
equal to the adjusted revenue base for 1996.
(b) For subdivision 1, clause (b), the reduction base is
equal to the adjusted revenue base for the year in which the aid
payment is to be made.
(c) For subdivision 1, clause (c), the reduction base is a
county's aid in calendar year 1996 under section 477A.0121.
(d) For subdivision 1, clause (d), the reduction base is a
county's aid in calendar year 1997 under section 477A.0121.
Reductions under subdivisions 1, paragraph (a), and 2,
paragraph (a), to any individual county, city, or town are
limited to an amount equal to 0.45 percent of the unit's 1994
adjusted net tax capacity. For this subdivision, "adjusted net
tax capacity" means the political subdivision's net tax capacity
calculated using the method for calculating city net tax
capacity under section 477A.011, subdivision 20.
Subd. 3. [ORDER OF AID REDUCTIONS.] (a) The aid reduction
to a local government calculated under subdivisions 1,
paragraphs (a) and (c), and 2, paragraphs (a) and (c), is
applied to homestead and agricultural credit aid under section
273.1398 only.
(b) The aid reduction to a local government calculated
under subdivisions 1, paragraph (d), and 2, paragraph (d), is
applied to homestead and agricultural credit aid paid under
section 273.1398 only; the amount is first subtracted from the
amount paid to a county's regional rail authority, if there is
one, and then from the county's general homestead and
agricultural credit aid.
(c) The aid reduction to a local government as calculated
under other paragraphs of subdivisions 1 and 2, is first applied
to its local government aid under sections 477A.012 and 477A.013
excluding aid under section 477A.013, subdivision 5; then, if
necessary, to its equalization aid under section 477A.013,
subdivision 5; then if necessary, to its homestead and
agricultural credit aid under section 273.1398, subdivision 2;
and then, if necessary, to its disparity reduction aid under
section 273.1398, subdivision 3. No aid payment may be less
than $0. Aid reductions under this section in any given year
shall be divided equally between the July and December aid
payments unless specified otherwise.
Sec. 47. Minnesota Statutes 1995 Supplement, section
477A.03, subdivision 2, is amended to read:
Subd. 2. [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 1996 and thereafter, the total
aids paid under sections 477A.013, subdivision 9, and 477A.0122
are the amounts certified to be paid in the previous year,
adjusted for inflation as provided under subdivision 3. Aid
payments to counties under section 477A.0121 are limited to
$20,265,000 in 1996. Aid payments to counties under section
477A.0121 are limited to $27,571,625 in 1997. For aid payable
in 1997 1998 and thereafter, the total aids paid under section
477A.0121 are the amounts certified to be paid in the previous
year, adjusted for inflation as provided under subdivision 3.
Sec. 48. [477A.05] [LOCAL PERFORMANCE AID.]
Subdivision 1. [QUALIFICATION.] By May 15, 1996, and March
31 of each year thereafter, the commissioner shall send a local
performance aid qualification form to each county and city in
the state. Jurisdictions that are eligible to receive the aid
must return the completed form by June 30 in order to receive
aid in the following calendar year. For each determinator
specified in subdivision 2, the form shall have a space for the
jurisdiction to indicate that it has satisfied the conditions of
the determinator. For counties, the form must be signed by the
chair of the county board. For cities, the form must be signed
by the mayor and a member of the city council.
Subd. 2. [ELIGIBILITY DETERMINATOR.] For calendar year
1997 and subsequent calendar years, a jurisdiction is eligible
to receive local performance aid if the jurisdiction affirms
that it has developed a system of performance measures for the
services provided by the jurisdiction, and that these measures
are regularly compiled and presented to the county board or the
city council at least once a year. A jurisdiction is also
eligible for aid under this determinator if it affirms that it
is in the process of developing and implementing a system of
performance measures; however, eligibility based upon being in
the process of development may not be used for more than two
consecutive years.
Subd. 3. [DETERMINATION OF AID AMOUNT.] The commissioner
shall sum the populations of all jurisdictions that have met the
condition specified in subdivision 2. The commissioner shall
determine a per capita aid amount by dividing the aggregate aid
available under subdivision 5 by the sum of the populations for
all qualifying jurisdictions, separately for counties and
cities. Each jurisdiction shall then be eligible for aid equal
to the jurisdictions's population times the per capita aid
amount. For purposes of this subdivision, population means the
most recent population established under section 477A.011,
subdivision 3 in the year in which the aid is determined.
Subd. 4. [NOTIFICATION AND PAYMENT.] Jurisdictions shall
be notified of their aid under this section at the same time as
the notification for aid under section 477A.014, subdivision 1.
Payments of aid under this section shall be made on the dates
prescribed in section 477A.015.
Subd. 5. [APPROPRIATION.] For payments to counties under
this section, there is annually appropriated from the general
fund to the commissioner of revenue an amount equal to the sum
of $558,625 plus the amount by which county aids were reduced
under section 49, adjusted for inflation as provided under
section 477A.03, subdivision 3. For payments to cities under
this section, there is annually appropriated from the general
fund to the commissioner of revenue an amount equal to the sum
of $441,735 plus the amount by which city aids were reduced
under section 49, adjusted for inflation as provided under
section 477A.03, subdivision 3.
Sec. 49. [AID REDUCTION.]
Calendar year 1997 aids to counties and cities under
section 273.1398, subdivision 2, shall be permanently reduced by
an amount equal to $1 times the most recent population of the
jurisdiction, established under section 477A.011, subdivision 3
in the year in which the aid is determined.
Sec. 50. Laws 1989, chapter 211, section 4, subdivision 1,
is amended to read:
Subdivision 1. [EXPENSES PAID FROM REVENUE, TAXES, AND
APPROPRIATIONS; TAX LIMITS.] Expenses of acquiring, improving,
and running medical clinic facilities operated by the medical
clinic district, and expenses of organization and administration
of the district and of planning and financing the facilities,
must be paid from the revenues derived from them, and to the
extent necessary, from property taxes levied by the medical
clinic board on all taxable property within the district. Taxes
levied by the board in any year may not exceed $30,000 $50,000.
Sec. 51. [RECREATION LEVY FOR SAWYER BY CARLTON COUNTY.]
Subdivision 1. [LEVY AUTHORIZED.] Notwithstanding other
law to the contrary, the Carlton county board of commissioners
may levy in and for the unorganized township of Sawyer an amount
up to $1,500 annually for recreational purposes, beginning with
taxes payable in 1997 and ending with taxes payable in 2006.
Subd. 2. [EFFECTIVE DATE.] This section is effective June
1, 1996, without local approval.
Sec. 52. [ONE YEAR DELAY; PROPERTY TAX REFUND ON TAX
STATEMENT.]
The dates contained in Laws 1995, chapter 264, article 4,
sections 16, 17, 18, 19, and 20 are delayed for a period of one
year from the dates contained in those sections.
Sec. 53. [TEMPORARY ABATEMENT AUTHORITY.]
Notwithstanding any law to the contrary, a county board may
abate, in full or part, unpaid property taxes, interest, and
penalties, if all the following conditions are satisfied:
(1) The property contains a vacant hotel building,
constructed before 1930 and in need of substantial
rehabilitation and repair.
(2) The property contains a building listed on the national
register or is located in a registered historic district.
(3) At least three years of property taxes are unpaid.
(4) The property is located in a city with a population of
less than 5,000.
(5) The city or another public development authority has
entered into a contract or development agreement with a private
person or entity who agrees to substantially rehabilitate the
building.
(6) The abatement is granted before January 1, 1997.
Sec. 54. [REVISOR INSTRUCTIONS.]
(a) In the next edition of Minnesota Statutes, the revisor
shall renumber section 383.06, subdivision 2, as section 373.01,
subdivision 4.
(b) In the next edition of Minnesota Statutes, the revisor
shall change the references in Minnesota Statutes, section
290A.26, from "fiscal year 1998" to "fiscal year 1999" and from
"fiscal year 1999" to "fiscal year 2000."
Sec. 55. [REPEALER.]
Minnesota Statutes 1994, section 273.1398, subdivision 5b,
is repealed.
Sec. 56. [EFFECTIVE DATE.]
Section 1 is effective for lien amounts first becoming
payable in 1996 and thereafter.
Section 2 is effective for referenda held in November of
1996 and thereafter.
Sections 3, 4, 7, 9, 11, 19, 22, 24, 32, 34, 38, 39, and 53
are effective the day following final enactment.
Sections 5, 6, 8, 10, 36, 37, 43, and 50 are effective for
the 1996 assessment and thereafter, for taxes payable in 1997,
and thereafter.
Sections 13 to 15, 45 to 49, and 55 are effective for aids
paid in 1997 and thereafter.
Section 16 is effective for notices prepared in 1996 for
taxes payable in 1997, and thereafter.
Section 17 is effective for public advertisements beginning
in 1996 and thereafter.
Section 18 is effective for public hearings held in 1996
and thereafter.
Section 25 is effective for petitions filed after the day
of final enactment.
Section 31 is effective for mortgages recorded or
registered after the day of final enactment.
Section 33 is effective for refunds for taxes payable in
1997.
Section 35 is effective for timely filed property tax
refund claims based on rent paid in 1996 and property taxes
payable in 1997, and thereafter.
Section 40 is effective for publication of budget
statements beginning in 1997.
Section 44 is effective for calculations in 1996 and
thereafter, for aids payable in 1997 and thereafter.
ARTICLE 4
FEDERAL UPDATE
Section 1. Minnesota Statutes 1995 Supplement, section
289A.02, subdivision 7, is amended to read:
Subd. 7. [INTERNAL REVENUE CODE.] Unless specifically
defined otherwise, "Internal Revenue Code" means the Internal
Revenue Code of 1986, as amended through April 15, 1995 March
22, 1996, and includes the provisions of section 1(a) and (b) of
Public Law Number 104-117.
Sec. 2. Minnesota Statutes 1994, section 289A.39,
subdivision 1, is amended to read:
Subdivision 1. [EXTENSIONS FOR SERVICE MEMBERS.] (a) The
limitations of time provided by this chapter, chapter 290
relating to income taxes, chapter 271 relating to the tax court
for filing returns, paying taxes, claiming refunds, commencing
action thereon, appealing to the tax court from orders relating
to income taxes, and the filing of petitions under chapter 278
that would otherwise be due May 15, 1991 1996, and appealing to
the Supreme Court from decisions of the tax court relating to
income taxes are extended, as provided in section 7508 of the
Internal Revenue Code.
(b) If a member of the national guard or reserves is called
to active duty in the armed forces, the limitations of time
provided by this chapter and chapters 290 and 290A relating to
income taxes and claims for property tax refunds are extended by
the following period of time:
(1) in the case of an individual whose active service is in
the United States, six months; or
(2) in the case of an individual whose active service
includes service abroad, the period of initial service plus six
months.
Nothing in this paragraph reduces the time within which an
act is required or permitted under paragraph (a).
(c) If an individual entitled to the benefit of paragraph
(a) files a return during the period disregarded under paragraph
(a), interest must be paid on an overpayment or refundable
credit from the due date of the return, notwithstanding section
289A.56, subdivision 2.
(d) The provisions of this subdivision apply to the spouse
of an individual entitled to the benefits of this subdivision
with respect to a joint return filed by the spouses.
Sec. 3. Minnesota Statutes 1995 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 net income of a designated settlement fund as defined
in section 468B(d) of the Internal Revenue Code means the gross
income as defined in section 468B(b) 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, 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, the provisions of
sections 7815 and 7821 of the Omnibus Budget Reconciliation Act
of 1989, Public Law Number 101-239, and the provisions of
section 11702 of the Revenue Reconciliation Act of 1990, Public
Law Number 101-508, 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, the
provision of section 1401 of the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989, Public Law Number 101-73,
and the provisions of sections 11701 and 11703 of the Revenue
Reconciliation Act of 1990, Public Law Number 101-508, shall
become effective at the time they become effective for federal
tax purposes.
The Internal Revenue Code of 1986, as amended through
December 31, 1989, shall be in effect for taxable years
beginning after December 31, 1989. The provisions of sections
11321, 11322, 11324, 11325, 11403, 11404, 11410, and 11521 of
the Revenue Reconciliation Act of 1990, Public Law Number
101-508, and the provisions of sections 13224 and 13261 of the
Omnibus Budget Reconciliation Act of 1993, Public Law Number
103-66, shall become effective at the time they become effective
for federal purposes.
The Internal Revenue Code of 1986, as amended through
December 31, 1990, shall be in effect for taxable years
beginning after December 31, 1990.
The provisions of section 13431 of the Omnibus Budget
Reconciliation Act of 1993, Public Law Number 103-66, shall
become effective at the time they became effective for federal
purposes.
The Internal Revenue Code of 1986, as amended through
December 31, 1991, shall be in effect for taxable years
beginning after December 31, 1991.
The provisions of sections 1936 and 1937 of the
Comprehensive National Energy Policy Act of 1992, Public Law
Number 102-486, and the provisions of sections 13101, 13114,
13122, 13141, 13150, 13151, 13174, 13239, 13301, and 13442 of
the Omnibus Budget Reconciliation Act of 1993, Public Law Number
103-66, shall become effective at the time they become effective
for federal purposes.
The Internal Revenue Code of 1986, as amended through
December 31, 1992, shall be in effect for taxable years
beginning after December 31, 1992.
The provisions of sections 13116, 13121, 13206, 13210,
13222, 13223, 13231, 13232, 13233, 13239, 13262, and 13321 of
the Omnibus Budget Reconciliation Act of 1993, Public Law Number
103-66, shall become effective at the time they become effective
for federal purposes.
The Internal Revenue Code of 1986, as amended through
December 31, 1993, shall be in effect for taxable years
beginning after December 31, 1993.
The provision of section 741 of Legislation to Implement
Uruguay Round of General Agreement on Tariffs and Trade, Public
Law Number 103-465, and the provisions of sections 1, 2, and 3,
of the Self-Employed Health Insurance Act of 1995, Public Law
Number 104-7, shall become effective at the time they become
effective for federal purposes.
The Internal Revenue Code of 1986, as amended through
December 31, 1994, shall be in effect for taxable years
beginning after December 31, 1994.
The Internal Revenue Code of 1986, as amended through March
22, 1996, is in effect for taxable years beginning after
December 31, 1995.
The provisions of Public Law Number 104-117 become
effective at the time they become effective for federal 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. 4. Minnesota Statutes 1995 Supplement, section
290.01, subdivision 31, is amended to read:
Subd. 31. [INTERNAL REVENUE CODE.] Unless specifically
defined otherwise, "Internal Revenue Code" means the Internal
Revenue Code of 1986, as amended through April 15, 1995 March
22, 1996, and includes the provisions of section 1(a) and (b) of
Public Law Number 104-117.
Sec. 5. Minnesota Statutes 1995 Supplement, section
291.005, subdivision 1, is amended to read:
Subdivision 1. Unless the context otherwise clearly
requires, the following terms used in this chapter shall have
the following meanings:
(1) "Federal gross estate" means the gross estate of a
decedent as valued and otherwise determined for federal estate
tax purposes by federal taxing authorities pursuant to the
provisions of the Internal Revenue Code.
(2) "Minnesota gross estate" means the federal gross estate
of a decedent after (a) excluding therefrom any property
included therein which has its situs outside Minnesota and (b)
including therein any property omitted from the federal gross
estate which is includable therein, has its situs in Minnesota,
and was not disclosed to federal taxing authorities.
(3) "Personal representative" means the executor,
administrator or other person appointed by the court to
administer and dispose of the property of the decedent. If
there is no executor, administrator or other person appointed,
qualified, and acting within this state, then any person in
actual or constructive possession of any property having a situs
in this state which is included in the federal gross estate of
the decedent shall be deemed to be a personal representative to
the extent of the property and the Minnesota estate tax due with
respect to the property.
(4) "Resident decedent" means an individual whose domicile
at the time of death was in Minnesota.
(5) "Nonresident decedent" means an individual whose
domicile at the time of death was not in Minnesota.
(6) "Situs of property" means, with respect to real
property, the state or country in which it is located; with
respect to tangible personal property, the state or country in
which it was normally kept or located at the time of the
decedent's death; and with respect to intangible personal
property, the state or country in which the decedent was
domiciled at death.
(7) "Commissioner" means the commissioner of revenue or any
person to whom the commissioner has delegated functions under
this chapter.
(8) "Internal Revenue Code" means the United States
Internal Revenue Code of 1986, as amended through April 15, 1995
March 22, 1996, and includes the provisions of section 1(a)(4)
of Public Law Number 104-117.
Sec. 6. [EFFECTIVE DATE.]
Sections 1, 4, and 5 are effective at the same time section
1 of Public Law Number 104-117 is effective. Section 2 is
effective for taxable years beginning after December 31, 1994,
and claims for property tax refunds filed after the day of final
enactment.
ARTICLE 5
MOTOR FUELS TAXES
Section 1. Minnesota Statutes 1995 Supplement, section
41A.09, subdivision 2a, is amended to read:
Subd. 2a. [DEFINITIONS.] For the purposes of this section,
the terms defined in this subdivision have the meanings given
them.
(a) "Ethanol" means fermentation ethyl alcohol derived from
agricultural products, including potatoes, cereal, grains,
cheese whey, and sugar beets; forest products; or other
renewable resources, including residue and waste generated from
the production, processing, and marketing of agricultural
products, forest products, and other renewable resources, that:
(1) meets all of the specifications in ASTM specification D
4806-88; and
(2) is denatured with unleaded gasoline or rubber
hydrocarbon solvent as defined specified in Code of Federal
Regulations, title 27, parts 211 20 and 212, as adopted by the
Bureau of Alcohol, Tobacco and Firearms of the United States
Treasury Department 21.
(b) "Wet alcohol" means agriculturally derived fermentation
ethyl alcohol having a purity of at least 50 percent but less
than 99 percent.
(c) "Anhydrous alcohol" means fermentation ethyl alcohol
derived from agricultural products as described in paragraph
(a), but that does not meet ASTM specifications or is not
denatured and is shipped in bond for further processing.
(d) "Ethanol plant" means a plant at which ethanol,
anhydrous alcohol, or wet alcohol is produced.
Sec. 2. Minnesota Statutes 1994, section 239.761,
subdivision 5, is amended to read:
Subd. 5. [DENATURED ETHANOL.] Denatured ethanol that is to
be blended with gasoline must be agriculturally derived and must
comply with ASTM specification D 4806-88. This includes the
requirement that ethanol may be denatured only with specified
concentrations of unleaded gasoline or rubber hydrocarbon
solvent as defined specified in Code of Federal Regulations,
title 27, parts 211 20 and 212, as adopted by the Bureau of
Alcohol, Tobacco and Firearms of the United States Treasury
Department 21.
Sec. 3. Minnesota Statutes 1994, section 296.01,
subdivision 2, is amended to read:
Subd. 2. [AGRICULTURAL ALCOHOL GASOLINE.] "Agricultural
alcohol gasoline" means a gasoline-ethanol blend of up to ten
percent agriculturally derived fermentation ethanol derived from
agricultural products, such as potatoes, cereal, grains, cheese
whey, sugar beets, or forest products or other renewable
resources, that:
(1) meets the specifications in ASTM specification D
4806-88; and
(2) is denatured with unleaded gasoline or rubber
hydrocarbon solvent as defined specified in Code of Federal
Regulations, title 27, parts 211 20 and 212, as adopted by the
Bureau of Alcohol, Tobacco and Firearms of the United States
Treasury Department 21.
Sec. 4. Minnesota Statutes 1994, section 296.01,
subdivision 13, is amended to read:
Subd. 13. [DENATURED ETHANOL.] "Denatured ethanol" means
ethanol that is to be blended with gasoline, has been
agriculturally derived, and complies with ASTM specification D
4806-88. This includes the requirement that ethanol may be
denatured only with specified concentrations of unleaded
gasoline or rubber hydrocarbon solvent as defined specified in
Code of Federal Regulations, title 27, parts 211 20 and 212, as
adopted by the Bureau of Alcohol, Tobacco and Firearms of the
United States Treasury Department 21.
Sec. 5. Minnesota Statutes 1995 Supplement, section
296.02, subdivision 1, is amended to read:
Subdivision 1. [TAX IMPOSED; EXCEPTION FOR QUALIFIED
SERVICE STATION.] There is imposed an excise tax on gasoline,
gasoline blended with ethanol, and agricultural alcohol
gasoline, used in producing and generating power for propelling
motor vehicles used on the public highways of this state. The
tax is imposed on the first distributor who received the product
in Minnesota. For purposes of this section, gasoline is defined
in section 296.01, subdivisions 10, 15b, 18, 19, 20, and 24a.
This tax is payable at the times, in the manner, and by persons
specified in this chapter. The tax is payable at the rate
specified in subdivision 1b, subject to the exceptions and
reductions specified in this section.
(a) Notwithstanding any other provision of law to the
contrary, the tax imposed on special fuel sold by a qualified
service station may not exceed, or the tax on gasoline delivered
to a qualified service station must be reduced to, a rate not
more than three cents per gallon above the state tax rate
imposed on such products sold by a service station in a
contiguous state located within the distance indicated in clause
(b).
(b) A "qualifying service station" means a service station
located within 7.5 miles, measured by the shortest route by
public road, from a service station selling like product in the
contiguous state.
(c) A qualified service station shall be allowed a credit
by the supplier or distributor, or both, for the amount of
reduction computed in accordance with clause (a).
A qualified service station, before receiving the credit,
shall be registered with the commissioner of revenue.
Sec. 6. Minnesota Statutes 1994, section 296.02, is
amended by adding a subdivision to read:
Subd. 1c. [QUALIFYING SERVICE STATIONS.] Notwithstanding
any other provision of law to the contrary, the tax imposed on
gasoline or undyed diesel fuel delivered to a qualified service
station may not exceed, or must be reduced to, a rate not more
than three cents per gallon above the state tax rate imposed on
such products sold by a service station in a contiguous state
located within the distance indicated in this subdivision.
A distributor shall be allowed a credit or refund for the
amount of reduction computed in accordance with this subdivision.
For purposes of this subdivision, a "qualifying service
station" means a service station located within 7.5 miles,
measured by the shortest route by public road, from a service
station selling like product in the contiguous state.
Sec. 7. Minnesota Statutes 1994, section 296.02,
subdivision 8, is amended to read:
Subd. 8. [CREDITS FOR SALES TO GOVERNMENTS AND SCHOOLS.]
Until October 1, 1999, a distributor shall be allowed a credit
of 80 cents for every on each gallon of fuel grade alcohol
blended with gasoline to produce agricultural alcohol gasoline
which is sold to the state, local units of government, or for
use in the transportation of pupils to and from school-related
events in vehicles owned by or under contract to a school
district. This reduction is in lieu of the reductions provided
in subdivision 7.
The amount of the credit for every gallon is:
(1) until October 1, 1996, 80 cents;
(2) until October 1, 1997, 60 cents;
(3) until October 1, 1998, 40 cents; and
(4) until October 1, 1999, 20 cents.
Sec. 8. Minnesota Statutes 1995 Supplement, section
296.025, subdivision 1, is amended to read:
Subdivision 1. [TAX IMPOSED.] There is hereby imposed an
excise tax on all special fuel at the rates specified in
subdivision 1b. For undyed diesel fuel, the tax is imposed on
the first distributor who received the product in Minnesota.
For dyed fuel being used illegally in a licensed motor vehicle,
the tax is imposed on the owner or operator of the motor
vehicle, or in some instances, on the dealer who supplied the
fuel. For dyed fuel used in a motor vehicle but subject to a
federal exemption, although no federal tax may be imposed, the
fuel is subject to owner or operator of the vehicle is liable
for the state tax. For other fuels, including jet fuel,
propane, and compressed natural gas, the tax is imposed on the
distributor, special fuel dealer, or bulk purchaser. This tax
is payable at the time and in the manner specified in this
chapter. For purposes of this section, "owner or operator"
means the operation of licensed motor vehicles, whether loaded
or empty, whether for compensation or not for compensation, and
whether owned by or leased to the motor carrier who operates
them or causes them to be operated.
Sec. 9. Minnesota Statutes 1994, section 296.025,
subdivision 6, is amended to read:
Subd. 6. [WHEN FUEL DEEMED SPECIAL FUEL; TAX.] All sales
of combustible gases and liquid petroleum products (except
gasoline) shall be deemed to be sales of special fuel if the
sales tickets, invoices, and records evidencing such sales fail
to show the true and correct names and addresses of the
purchasers. In such cases, there is hereby imposed an excise
tax of the same rate per gallon as the gasoline excise tax on
all such combustible gases and liquid petroleum products, and
the vendor shall be liable for such tax to the extent not
previously paid.
Sec. 10. Minnesota Statutes 1995 Supplement, section
296.12, subdivision 3, is amended to read:
Subd. 3. [TAX COLLECTION, REPORTING AND PAYMENT.] (a) For
undyed diesel fuel, the tax is imposed on the distributor who
receives the fuel.
(b) For all other special fuels, the tax is imposed on the
distributor, bulk purchaser, or special fuel dealer. The tax
may be paid upon receipt or sale as follows:
(1) Distributors and special fuel dealers may, subject to
the approval of the commissioner, elect to pay to the
commissioner the special fuel excise tax on all special fuel
delivered or sold into the supply tank of an aircraft or a
licensed motor vehicle. Under this option an invoice must be
issued at the time of each delivery showing the name and address
of the purchaser, date of sale, number of gallons, price per
gallon and total amount of sale. A separate sales ticket book
shall be maintained for special fuel sales; and
(2) Bulk purchasers shall report and pay the excise tax on
all special fuel purchased by them for storage, to the
commissioner in the form and manner prescribed by the
commissioner.
(c) Any person delivering special fuel on which the excise
tax has not previously been paid, into the supply tank of an
aircraft or a licensed motor vehicle shall report such delivery
and shall pay, or collect and pay the excise tax on the special
fuel so delivered, to the commissioner.
Sec. 11. Minnesota Statutes 1994, section 296.141,
subdivision 4, is amended to read:
Subd. 4. [CREDIT OR REFUND OF TAX PAID.] The commissioner
shall allow the distributor credit or refund of the tax paid on
gasoline and special fuel:
(1) exported or sold for export from the state, other than
in the supply tank of a motor vehicle or of an aircraft;
(2) sold to the United States government to be used
exclusively in performing its governmental functions and
activities or to any "cost plus a fixed fee" contractor employed
by the United States government on any national defense project;
(3) if the fuel is placed in a tank used exclusively for
residential heating;
(4) destroyed by accident while in the possession of the
distributor;
(5) in error;
(6) sold for storage in an on-farm bulk storage tank, if
the tax was not collected on the sale; and
(7) (6) in such other cases as the commissioner may permit,
not inconsistent with the provisions of this chapter and other
laws relating to the gasoline and special fuel excise taxes.
Sec. 12. Minnesota Statutes 1994, section 296.141,
subdivision 5, is amended to read:
Subd. 5. [REFUND TO DEALER; DESTRUCTION BY ACCIDENT.]
Notwithstanding the provisions of subdivision 4, the
commissioner shall allow a dealer a refund of the tax paid on
gasoline or special fuel destroyed by accident while in the
possession of the dealer:
(1) the tax paid by the distributor on gasoline or undyed
diesel fuel destroyed by accident while in the possession of the
dealer; or
(2) the tax paid by a distributor or special fuels dealer
on other special fuels destroyed by accident while in the
possession of the dealer.
Sec. 13. Minnesota Statutes 1994, section 296.15, is
amended by adding a subdivision to read:
Subd. 2a. [IMPOSITION OF CIVIL PENALTY; DYED FUEL.] (a) If
any dyed fuel is sold or held for sale by a person for any use
which the person knows or has reason to know is not a nontaxable
use of the fuel; or if any dyed fuel is held for use or used in
a licensed motor vehicle or for any other use by a person for a
use other than a nontaxable use and the person knew, or had
reason to know, that the fuel was so dyed; or if a person
willfully alters, or attempts to alter, the strength or
composition of any dye or marking in any dyed fuel, then the
person shall pay a penalty in addition to the tax, if any.
(b) Except as provided in paragraph (c), the amount of
penalty under paragraph (a) for each act is the greater of
$1,000, or $10 for each gallon of dyed fuel involved.
(c) With regard to a multiple violation under paragraph
(a), the penalty shall be applied by increasing the amount in
paragraph (b) by the product of (1) such amount, and (2) the
number of prior penalties, if any, imposed by this section on
the person, or a related person, or any predecessor of the
person or related person.
(d) If a penalty is imposed under this section on a
business entity, each officer, employee, or agent of the entity
who willfully participated in any act giving rise to the penalty
is jointly and severally liable with the entity for the penalty.
Sec. 14. Minnesota Statutes 1994, section 296.17,
subdivision 7, is amended to read:
Subd. 7. [DEFINITIONS.] As used in subdivisions 7 to 22:
(a) "motor fuel" means a liquid, regardless of its
composition or properties, used to propel a motor vehicle;
(b) "commercial motor vehicle" means a passenger vehicle
that has seats for more than 20 passengers in addition to the
driver, or a power unit that (1) has a gross weight in excess of
26,000 pounds, or (2) has three or more axles regardless of
weight, or (3) when used in combination, the weight of the
combination exceeds 26,000 pounds gross vehicle weight; motor
vehicle used, designed, or maintained for transportation of
persons or property that:
(1) has two axles and a gross vehicle weight or registered
gross vehicle weight exceeding 26,000 pounds; or
(2) has three or more axles regardless of weight; or
(3) is used in combination, when the weight of such
combination exceeds 26,000 pounds gross vehicle or registered
gross vehicle weight. "Commercial motor vehicle" does not
include recreational vehicles;
(c) "motor carrier" means a person who operates or causes
to be operated a commercial motor vehicle on a highway in this
state;
(d) "operation" means operation of commercial motor
vehicles whether loaded or empty, whether for compensation or
not for compensation, and whether owned by or leased to the
motor carrier who operates them or causes them to be operated;
and
(e) "highway" means the entire width between the boundary
lines of every way publicly maintained when part of the highway
is open for the public to travel on.
Sec. 15. [REPEALER.]
Minnesota Statutes 1994, section 296.25, subdivision 1a, is
repealed.
Sec. 16. [EFFECTIVE DATE.]
Sections 1 to 6, 8 to 10, and 12 to 15 are effective the
day following final enactment. Section 11 is effective for
gasoline or special fuel purchased after July 1, 1996.
ARTICLE 6
MINNESOTACARE TAXES
Section 1. Minnesota Statutes 1995 Supplement, section
295.50, subdivision 3, is amended to read:
Subd. 3. [GROSS REVENUES.] "Gross revenues" are total
amounts received in money or otherwise by:
(1) a resident hospital for patient services;
(2) a resident surgical center for patient services;
(3) a nonresident hospital for patient services provided to
patients domiciled in Minnesota;
(4) a nonresident surgical center for patient services
provided to patients domiciled in Minnesota;
(5) a resident health care provider, other than a staff
model health carrier, for patient services;
(6) a nonresident health care provider for patient services
provided to an individual domiciled in Minnesota or patient
services provided in Minnesota;
(7) (4) a wholesale drug distributor for sale or
distribution of legend drugs that are delivered: (i) to a
Minnesota resident by a wholesale drug distributor who is a
nonresident pharmacy directly, by common carrier, or by mail; or
(ii) in Minnesota by the wholesale drug distributor, by common
carrier, or by mail, unless the legend drugs are delivered to
another wholesale drug distributor who sells legend drugs
exclusively at wholesale. Legend drugs do not include
nutritional products as defined in Minnesota Rules, part
9505.0325;
(8) (5) a staff model health plan company as gross premiums
for enrollees, copayments, deductibles, coinsurance, and fees
for patient services covered under its contracts with groups and
enrollees; and
(9) (6) a resident pharmacy for medical supplies,
appliances, and equipment; and
(10) a nonresident pharmacy for medical supplies,
appliances, and equipment provided to consumers domiciled in
Minnesota or delivered into Minnesota.
Sec. 2. Minnesota Statutes 1995 Supplement, section
295.50, subdivision 4, is amended to read:
Subd. 4. [HEALTH CARE PROVIDER.] (a) "Health care
provider" means:
(1) a person furnishing any or all of the following goods
or services directly to a patient or consumer: medical,
surgical, optical, visual, dental, hearing, nursing services,
drugs, medical supplies, medical appliances, laboratory,
diagnostic or therapeutic services, or any goods and services
not listed above that qualify for reimbursement under the
medical assistance program provided under chapter 256B. For
purposes of this clause, "directly to a patient or consumer"
includes goods and services provided in connection with
independent medical examinations under section 65B.56 or other
examinations for purposes of litigation or insurance claims;
(2) a staff model health plan company; or
(3) an ambulance service required to be licensed.
(b) Health care provider does not include hospitals,
nursing homes licensed under chapter 144A or licensed in any
other jurisdiction, pharmacies, surgical centers, bus and
taxicab transportation, or any other providers of transportation
services other than ambulance services required to be licensed,
supervised living facilities for persons with mental retardation
or related conditions, licensed under Minnesota Rules, parts
4665.0100 to 4665.9900, residential care homes licensed under
chapter 144B, board and lodging establishments providing only
custodial services that are licensed under chapter 157 and
registered under section 157.031 to provide supportive services
or health supervision services, adult foster homes as defined in
Minnesota Rules, part 9555.5050 9555.5105, day training and
habilitation services for adults with mental retardation and
related conditions as defined in section 252.41, subdivision 3,
and boarding care homes, as defined in Minnesota Rules, part
4655.0100.
Sec. 3. Minnesota Statutes 1994, section 295.50,
subdivision 6, is amended to read:
Subd. 6. [HOME HEALTH CARE SERVICES.] "Home health care
services" are services:
(1) defined under the state medical assistance program as
home health agency services provided by a home health agency,
personal care services and supervision of personal care
services, private duty nursing services, and waivered services;
and
(2) provided at a recipient's residence, if the recipient
does not live in a hospital, nursing facility, as defined in
section 62A.46, subdivision 3, or intermediate care facility for
persons with mental retardation as defined in section 256B.055,
subdivision 12, paragraph (d).
Sec. 4. Minnesota Statutes 1994, section 295.51,
subdivision 1, is amended to read:
Subdivision 1. [BUSINESS TRANSACTIONS IN MINNESOTA.] A
hospital, surgical center, pharmacy, or health care provider is
subject to tax under sections 295.50 to 295.58 295.59 if it is
"transacting business in Minnesota." A hospital, surgical
center, pharmacy, or health care provider is transacting
business in Minnesota only if it:
(1) maintains an office in Minnesota used in the trade or
business of providing patient services or medical supplies,
appliances, or equipment;
(2) has employees, representatives, or independent
contractors conducting business in Minnesota related to the
trade or business of providing patient services or medical
supplies, appliances, or equipment;
(3) regularly provides patient services or medical
supplies, appliances, or equipment to customers that receive the
services in Minnesota;
(4) regularly solicits business from potential customers in
Minnesota. A hospital, surgical center, pharmacy, or health
care provider is presumed to regularly solicit business within
Minnesota if it receives gross receipts for patient services or
medical supplies, appliances, or equipment from 20 or more
patients domiciled in Minnesota in a calendar year;
(5) regularly performs services outside Minnesota the
benefits of which are consumed in Minnesota;
(6) owns or leases tangible personal or real property
physically located in Minnesota and used in the trade or
business of providing patient services or medical supplies,
appliances, or equipment; or
(7) receives medical assistance payments from the state of
Minnesota. maintains contacts with or presence in the state of
Minnesota sufficient to permit taxation of gross revenues
received for patient services under the United States
Constitution.
Sec. 5. Minnesota Statutes 1994, section 295.51, is
amended by adding a subdivision to read:
Subd. 1a. [NEXUS IN MINNESOTA.] A wholesale drug
distributor has nexus in Minnesota if its contacts with or
presence in Minnesota is sufficient to satisfy the requirements
of the United States Constitution.
Sec. 6. Minnesota Statutes 1994, section 295.52, is
amended by adding a subdivision to read:
Subd. 4a. [TAX COLLECTION.] A wholesale drug distributor
with nexus in Minnesota, who is not subject to tax under
subdivision 3, on all or a particular transaction, is required
to collect the tax imposed under subdivision 4, from the
purchaser of the drugs and give the purchaser a receipt for the
tax paid. The tax collected shall be remitted to the
commissioner in the manner prescribed by section 295.55,
subdivision 3.
Sec. 7. Minnesota Statutes 1995 Supplement, section
295.53, subdivision 1, is amended to read:
Subdivision 1. [EXEMPTIONS.] (a) The following payments
are excluded from the gross revenues subject to the hospital,
surgical center, or health care provider taxes under sections
295.50 to 295.57:
(1) payments received for services provided under the
Medicare program, including payments received from the
government, and organizations governed by sections 1833 and 1876
of title XVIII of the federal Social Security Act, United States
Code, title 42, section 1395, and enrollee deductibles,
coinsurance, and copayments, whether paid by the Medicare
enrollee or by a Medicare supplemental coverage as defined in
section 62A.011, subdivision 3, clause (10). Payments for
services not covered by Medicare are taxable;
(2) medical assistance payments including payments received
directly from the government or from a prepaid plan;
(3) payments received for home health care services;
(4) payments received from hospitals or surgical centers
for goods and services on which liability for tax is imposed
under section 295.52 or the source of funds for the payment is
exempt under clause (1), (2), (7), (8), or (10);
(5) payments received from health care providers for goods
and services on which liability for tax is imposed under this
chapter or the source of funds for the payment is exempt under
clause (1), (2), (7), (8), or (10);
(6) amounts paid for legend drugs, other than nutritional
products, to a wholesale drug distributor reduced by
reimbursements received for legend drugs under clauses (1), (2),
(7), and (8);
(7) payments received under the general assistance medical
care program including payments received directly from the
government or from a prepaid plan;
(8) payments received for providing services under the
MinnesotaCare program including payments received directly from
the government or from a prepaid plan and enrollee deductibles,
coinsurance, and copayments. For purposes of this clause,
coinsurance means the portion of payment that the enrollee is
required to pay for the covered service;
(9) payments received by a resident health care provider or
the wholly owned subsidiary of a resident health care provider
for care provided outside Minnesota to a patient who is not
domiciled in Minnesota;
(10) payments received from the chemical dependency fund
under chapter 254B;
(11) payments received in the nature of charitable
donations that are not designated for providing patient services
to a specific individual or group;
(12) payments received for providing patient services
incurred through a formal program of health care research
conducted in conformity with federal regulations governing
research on human subjects. Payments received from patients or
from other persons paying on behalf of the patients are subject
to tax;
(13) payments received from any governmental agency for
services benefiting the public, not including payments made by
the government in its capacity as an employer or insurer;
(14) payments received for services provided by community
residential mental health facilities licensed under Minnesota
Rules, parts 9520.0500 to 9520.0690, community support programs
and family community support programs approved under Minnesota
Rules, parts 9535.1700 to 9535.1760, and community mental health
centers as defined in section 245.62, subdivision 2;
(15) government payments received by a regional treatment
center;
(16) payments received for hospice care services;
(17) payments received by a resident health care
provider or the wholly owned subsidiary of a resident health
care provider for medical supplies, appliances and equipment
delivered outside of Minnesota;
(18) payments received by a post-secondary educational
institution from student tuition, student activity fees, health
care service fees, government appropriations, donations, or
grants. Fee for service payments and payments for extended
coverage are taxable; and
(19) payments received for services provided by: assisted
living programs and congregate housing programs.
(b) Payments received by wholesale drug distributors for
prescription drugs sold directly to veterinarians or veterinary
bulk purchasing organizations are excluded from the gross
revenues subject to the wholesale drug distributor tax under
sections 295.50 to 295.59.
Sec. 8. Minnesota Statutes 1995 Supplement, section
295.53, subdivision 5, is amended to read:
Subd. 5. [EXEMPTIONS FOR PHARMACIES.] (a) Pharmacies may
exclude from their gross revenues subject to tax payments for
medical supplies, appliances, and devices that are exempt under
subdivision 1, clauses (1), (2), (4), (5), (7), (8), and (13).
(b) Resident Pharmacies may exclude from their gross
revenues subject to tax payments received for medical supplies,
appliances, and equipment delivered outside of Minnesota.
Sec. 9. Minnesota Statutes 1994, section 295.54,
subdivision 1, is amended to read:
Subdivision 1. [TAXES PAID TO ANOTHER STATE.] A resident
hospital, resident surgical center, pharmacy, or resident health
care provider who is liable for that has paid taxes payable to
another state or province or territory of Canada measured by
gross receipts revenues and is subject to tax under section
sections 295.52 to 295.59 on the same gross revenues is entitled
to a credit for the tax legally due and paid to another state or
province or territory of Canada to the extent of the lesser of
(1) the tax actually paid to the other state or province or
territory of Canada, or (2) the amount of tax imposed by
Minnesota on the gross receipts revenues subject to tax in the
other taxing jurisdictions.
Sec. 10. Minnesota Statutes 1994, section 295.54,
subdivision 2, is amended to read:
Subd. 2. [PHARMACY CREDIT.] A resident pharmacy may claim
a quarterly credit against the total amount of tax the pharmacy
owes during that quarter under section 295.52, subdivision 1b,
as provided in this subdivision. The credit shall equal two
percent of the amount paid by the pharmacy to a wholesale drug
distributor subject to tax under section 295.52, subdivision 3,
for legend drugs delivered by the pharmacy outside of Minnesota.
If the amount of the credit exceeds the tax liability of the
pharmacy under section 295.52, subdivision 1b, the commissioner
shall provide the pharmacy with a refund equal to the excess
amount.
Sec. 11. Minnesota Statutes 1994, section 295.54, is
amended by adding a subdivision to read:
Subd. 3. [WHOLESALE DRUG DISTRIBUTOR CREDIT.] A wholesale
drug distributor who has paid taxes to another state or province
or territory of Canada measured by gross revenues or sales and
is subject to tax under sections 295.52 to 295.59 on the same
gross revenues or sales is entitled to a credit for the tax
legally due and paid to another state or province or territory
of Canada to the extent of the lesser of (1) the tax actually
paid to the other state or province or territory of Canada or
(2) the amount of tax imposed by Minnesota on the gross revenues
or sales subject to tax in the other taxing jurisdictions.
Sec. 12. [LEGISLATIVE INTENT.]
Section 3 is intended to clarify, rather than change, the
original intent of the statute amended.
Sec. 13. [REPEALER.]
Minnesota Statutes 1994, section 295.50, subdivisions 8, 9,
9a, 11, 12, and 12a, are repealed.
Sec. 14. [EFFECTIVE DATES.]
Sections 1, 3, 4, 7 to 10, 12, and 13 are effective the day
following final enactment.
Sections 5, 6, and 11 are effective for tax periods
beginning on or after January 1, 1997.
ARTICLE 7
ECONOMIC DEVELOPMENT
Section 1. Minnesota Statutes 1994, section 13.99,
subdivision 97a, is amended to read:
Subd. 97a. [ECONOMIC DEVELOPMENT DATA.] Access to
preliminary information submitted to the commissioner of trade
and economic development under sections 469.142 to 469.151 or
sections 469.152 to 469.165 is limited under sections 469.150
and section 469.154, subdivision 2.
Sec. 2. Minnesota Statutes 1995 Supplement, section
216B.161, subdivision 1, is amended to read:
Subdivision 1. [DEFINITIONS.] (a) For purposes of this
section, the following terms have the meanings given them in
this subdivision.
(b) "Area development rate" means a rate schedule
established by a utility that provides customers within an area
development zone service under a base utility rate schedule,
except that charges may be reduced from the base rate as agreed
upon by the utility and the customer consistent with this
section.
(c) "Area development zone" means a contiguous or
noncontiguous area designated by an authority or municipality
for development or redevelopment and within which one of the
following conditions exists:
(1) obsolete buildings not suitable for improvement or
conversion or other identified hazards to the health, safety,
and general well-being of the community;
(2) buildings in need of substantial rehabilitation or in
substandard condition; or
(3) low values and damaged investments.
(d) "Authority" means a rural development financing
authority established under sections 469.142 to 469.150 469.151;
a housing and redevelopment authority established under sections
469.001 to 469.047; a port authority established under sections
469.048 to 469.068; an economic development authority
established under sections 469.090 to 469.108; a redevelopment
agency as defined in sections 469.152 to 469.165; the iron range
resources and rehabilitation board established under section
298.22; a municipality that is administering a development
district created under sections 469.124 to 469.134 or any
special law; a municipality that undertakes a project under
sections 469.152 to 469.165, except a town located outside the
metropolitan area as defined in section 473.121, subdivision 2,
or with a population of 5,000 persons or less; or a municipality
that exercises the powers of a port authority under any general
or special law.
(e) "Municipality" means a city, however organized, and,
with respect to a project undertaken under sections 469.152 to
469.165, "municipality" has the meaning given in sections
469.152 to 469.165, and, with respect to a project undertaken
under sections 469.142 to 469.151 or a county or multicounty
project undertaken under sections 469.004 to 469.008, also
includes any county.
Sec. 3. Minnesota Statutes 1995 Supplement, section
273.1399, subdivision 6, is amended to read:
Subd. 6. [EXEMPT DISTRICTS.] (a) The provisions of this
section do not apply to exempt tax increment financing districts
as specified by this subdivision.
(b) A tax increment financing district for an ethanol
production facility that satisfies all of the following
requirements is exempt:
(1) The district is an economic development district, that
qualifies under section 469.176, subdivision 4c, paragraph (a),
clause (1).
(2) The facility is certified by the commissioner of
agriculture to qualify for state payments for ethanol
development under section 41A.09 to the extent funds are
available.
(3) Increments from the district are used only to finance
the qualifying ethanol development project located in the
district or to pay for administrative costs of the district.
(4) The district is located outside of the seven-county
metropolitan area, as defined in section 473.121.
(5) The tax increment financing plan was approved by a
resolution of the county board.
(6) The exemption provided by this paragraph applies until
the first year after the total amount of increment for the
district exceeds $1,500,000. The county auditor shall notify
the commissioner of revenue of the expiration of the exemption
by June 1 of the year in which the auditor projects the revenues
from increments will exceed $1,500,000. On or before the
expiration of the exemption, the municipality may elect to make
a qualifying local contribution under paragraph (d) in lieu of
the state aid reduction.
(c) A qualified housing district is exempt.
(d)(1) A district is exempt if the municipality elects at
the time of approving the tax increment financing plan for the
district to make a qualifying local contribution. To qualify
for the exemption in each year, the authority or the
municipality must make a qualifying local contribution equal to
the listed percentages of increment from the district or
subdistrict:
(1) (A) for an economic development district, a housing
district, or a renewal and renovation district, ten percent;
(2) (B) for a redevelopment district, a mined underground
space district, a hazardous substance subdistrict, or a soils
condition district, 7.5 five percent.
(2) If the municipality elects to make a qualifying
contribution and fails to make the required contribution for a
year, the state aid reduction applies for the year. The state
aid reduction equals the greater of (A) the required local
contribution or (B) the amount of the aid reduction that applies
under subdivision 3. For a district exempt under paragraph (b),
no qualifying local contribution is required for years in which
the district is exempt.
The maximum local contribution for all districts in the
municipality is limited to (3)(A) If the sum of required local
contributions for all districts in the municipality exceeds two
percent of city net tax capacity as defined in section 477A.011,
subdivision 20, for a year, the municipality's total required
local contribution for that year is limited to two percent of
net tax capacity to qualify for the exemption under this
subdivision. The municipality may allocate the contribution
among the districts on which it has made elections as it
determines appropriate.
(B) If a municipality makes an election under this
subdivision for a district in a year in which item (A) applies,
a minimum annual qualifying contribution must be made for the
district equal to the lesser of 0.25 percent of city net tax
capacity or three percent of increment revenues. This minimum
contribution applies for the life of the district for each year
that the restriction in item (A) applies and is in addition to
the contribution required by item (A).
(4) The amount of the local contribution must be made out
of unrestricted money of the authority or municipality, such as
the general fund, a property tax levy, or a federal or a state
grant-in-aid which may be spent for general government
purposes. The local contribution may not be made, directly or
indirectly, with tax increments or developer payments as defined
under section 469.1766. The local contribution must be used to
pay project costs and cannot be used for general government
purposes or for improvements or costs that the authority or
municipality planned to incur absent the project. The authority
or municipality may request contributions from other local
government entities that will benefit from the district's
activities. These contributions reduce the local contribution
required of the municipality or authority by this paragraph.
Cities, counties, towns, and schools may contribute to paying
these costs, notwithstanding any other law to the contrary.
(5) The municipality may make a local contribution in
excess of the required contribution for a year. If it does so,
the municipality may credit the excess to a local contribution
account for the district. The balance in the account may be
used to meet the requirements for qualifying local contributions
for later years. No interest or investment earnings may be
credited or imputed to the account, except those (A) actually
paid by the municipality out of its unrestricted funds or by
another person or entity, other than a developer as used in
section 469.1766, and (B) used as required for a qualifying
local contribution.
(6) If the state contributes to the project costs through a
direct grant or similar incentive, the required local
contribution is reduced by one-half of the dollar amount of the
state grant or other similar incentive.
Sec. 4. Minnesota Statutes 1995 Supplement, section
273.1399, subdivision 7, is amended to read:
Subd. 7. [EXEMPTION; AGRICULTURAL PROCESSING FACILITIES.]
The provisions of this section do not apply to a tax increment
financing district that satisfies all of the following
requirements:
(1) the district is established to construct or expand an
agricultural processing facility;
(2) the construction or expansion of the facility creates,
or upon completion will create, a minimum of five permanent
full-time jobs;
(3) the district is located outside of the seven-county
metropolitan area, as defined in section 473.121;
(4) the tax increment financing plan was approved by a
resolution of the county board;
(5) the municipality approving the tax increment financing
plan agrees to make at least a five percent local contribution
that meets the requirements of subdivision 6, paragraph (d),
including except that a required rate of five percent applies
and the limitation to two percent of city tax capacity under
subdivision 6, paragraph (d), clause (3) also applies; and
(6) the commissioner of agriculture has certified to the
county auditor that the requirements of this subdivision have
been met.
The exemption provided by this subdivision applies until
the first year after the total amount of increment for the
district exceeds $1,500,000. The county auditor shall notify
the commissioner of revenue of the expiration of the exemption
by June 1 of the year in which the auditor projects the revenues
from increment will exceed $1,500,000.
For purposes of this section, "agricultural processing
facility" means land, buildings, structures, fixtures, and
improvements used or operated primarily for the processing or
production of marketable products from agricultural crops,
including waste and residues from agricultural crops, and
including livestock products, poultry products, and wood
products, but not the raising of livestock or poultry.
Sec. 5. Minnesota Statutes 1994, section 469.167,
subdivision 2, is amended to read:
Subd. 2. [DURATION.] The designation of an area as an
enterprise zone shall be effective for seven years after the
date of designation, except that enterprise zones in border
cities eligible to receive allocations for tax reductions under
section 469.169, subdivisions 7 and 8, and under section
469.171, subdivision 6a or 6b, shall be effective until these
allocations have been expended terminated by resolution adopted
by the city in which the border city enterprise zone is located.
Sec. 6. Minnesota Statutes 1995 Supplement, section
469.169, subdivision 9, is amended to read:
Subd. 9. [ADDITIONAL BORDER CITY ALLOCATIONS.] In addition
to tax reductions authorized in subdivisions 7 and 8, the
commissioner may allocate $1,100,000 for tax reductions to
border city enterprise zones in cities located on the western
border of the state, and $300,000 to the border city enterprise
zone in the city of Duluth. The commissioner shall make
allocations to zones in cities on the western border by
evaluating which cities' applications for allocations relate to
business prospects that have the greatest positive economic
impact. Allocations made under this subdivision may be used for
tax reductions as provided in section 469.171, or other offsets
of taxes imposed on or remitted by businesses located in the
enterprise zone, but only if the municipality determines that
the granting of the tax reduction or offset is necessary in
order to retain a business within or attract a business to the
zone. Limitations on allocations under section 469.169,
subdivision 7, do not apply to this allocation. Enterprise
zones that receive allocations under this subdivision may
continue in effect for purposes of those allocations through
December 31, 1995.
Sec. 7. Minnesota Statutes 1995 Supplement, section
469.169, subdivision 10, is amended to read:
Subd. 10. [ADDITIONAL BORDER CITY ALLOCATIONS.] In
addition to tax reductions authorized in subdivisions 7, 8, and
9, the commissioner may allocate $1,500,000 for tax reductions
to border city enterprise zones in cities located on the western
border of the state. The commissioner shall make allocations to
zones in cities on the western border on a per capita basis.
Allocations made under this subdivision may be used for tax
reductions as provided in section 469.171, or other offsets of
taxes imposed on or remitted by businesses located in the
enterprise zone, but only if the municipality determines that
the granting of the tax reduction or offset is necessary in
order to retain a business within or attract a business to the
zone. Limitations on allocations under section 469.169,
subdivision 7, do not apply to this allocation. Enterprise
zones that receive allocations under this subdivision may
continue in effect for purposes of those allocations through
December 31, 1996.
Sec. 8. Minnesota Statutes 1994, section 469.173,
subdivision 7, is amended to read:
Subd. 7. [REPEALER.] Sections 469.169, 469.171, 469.172,
and this section are effective for border city enterprise zones
until the enterprise zone is terminated by resolution adopted by
the city in which the border city enterprise zone is located.
For all other enterprise zones, sections 469.169, 469.171,
469.172, and this section are repealed effective December 31,
1996.
Sec. 9. Minnesota Statutes 1994, section 469.174,
subdivision 2, is amended to read:
Subd. 2. [AUTHORITY.] "Authority" means a rural
development financing authority created pursuant to sections
469.142 to 469.150 469.151; a housing and redevelopment
authority created pursuant to sections 469.001 to 469.047; a
port authority created pursuant to sections 469.048 to 469.068;
an economic development authority created pursuant to sections
469.090 to 469.108; a redevelopment agency as defined in
sections 469.152 to 469.165; a municipality that is
administering a development district created pursuant to
sections 469.124 to 469.134 or any special law; a municipality
that undertakes a project pursuant to sections 469.152 to
469.165, except a town located outside the metropolitan area or
with a population of 5,000 persons or less; or a municipality
that exercises the powers of a port authority pursuant to any
general or special law.
Sec. 10. Minnesota Statutes 1995 Supplement, section
469.174, subdivision 4, is amended to read:
Subd. 4. [CAPTURED NET TAX CAPACITY.] "Captured net tax
capacity" means the amount by which the current net tax capacity
of a tax increment financing district or an extended subdistrict
exceeds the original net tax capacity, including the value of
property normally taxable as personal property by reason of its
location on or over property owned by a tax-exempt entity. In
the case of a hazardous substance subdistrict, except an
extended subdistrict, "captured net tax capacity" means the
amount, if any, by which the lesser of (1) the original net tax
capacity or (2) the current net tax capacity of the portion of
the tax increment financing district overlying the subdistrict
exceeds the original net tax capacity of the subdistrict.
Sec. 11. Minnesota Statutes 1995 Supplement, section
469.175, subdivision 1, is amended to read:
Subdivision 1. [TAX INCREMENT FINANCING PLAN.] (a) A tax
increment financing plan shall contain:
(1) a statement of objectives of an authority for the
improvement of a project;
(2) a statement as to the development program for the
project, including the property within the project, if any, that
the authority intends to acquire;
(3) a list of any development activities that the plan
proposes to take place within the project, for which contracts
have been entered into at the time of the preparation of the
plan, including the names of the parties to the contract, the
activity governed by the contract, the cost stated in the
contract, and the expected date of completion of that activity;
(4) identification or description of the type of any other
specific development reasonably expected to take place within
the project, and the date when the development is likely to
occur;
(5) estimates of the following:
(i) cost of the project, including administration expenses;
(ii) amount of bonded indebtedness to be incurred;
(iii) sources of revenue to finance or otherwise pay public
costs;
(iv) the most recent net tax capacity of taxable real
property within the tax increment financing district and within
any subdistrict;
(v) the estimated captured net tax capacity of the tax
increment financing district at completion; and
(vi) the duration of the tax increment financing district's
and any subdistrict's existence;
(6) statements of the authority's alternate estimates of
the impact of tax increment financing on the net tax capacities
of all taxing jurisdictions in which the tax increment financing
district is located in whole or in part. For purposes of one
statement, the authority shall assume that the estimated
captured net tax capacity would be available to the taxing
jurisdictions without creation of the district, and for purposes
of the second statement, the authority shall assume that none of
the estimated captured net tax capacity would be available to
the taxing jurisdictions without creation of the district or
subdistrict;
(7) identification and description of studies and analyses
used to make the determination set forth in subdivision 3,
clause (2); and
(8) identification of all parcels to be included in the
district or any subdistrict.
(b) For a housing district, redevelopment district, or a
hazardous substance subdistrict, the authority may elect in the
tax increment financing plan to provide for the identification
of a minimum market value in the plan, development agreement, or
assessment agreement, and provide that increment is first
received by the authority when (1) the market value of the
improvements as determined by the assessor reaches or exceeds
the minimum market value, or (2) four years has elapsed from the
date of certification of the original net tax capacity of the
taxable real property in the district or subdistrict by the
county auditor, whichever is earlier.
Sec. 12. Minnesota Statutes 1995 Supplement, section
469.175, subdivision 5, is amended to read:
Subd. 5. [ANNUAL DISCLOSURE.] (a) For all tax increment
financing districts, whether created prior or subsequent to
August 1, 1979, on or before July 1 of each year, the authority
shall submit to the county board, the county auditor, the school
board, state auditor and, if the authority is other than the
municipality, the governing body of the municipality, a report
of the status of the district. The report shall include the
following information: the amount and the source of revenue in
the account, the amount and purpose of expenditures from the
account, the amount of any pledge of revenues, including
principal and interest on any outstanding bonded indebtedness,
the original net tax capacity of the district and any
subdistrict, the captured net tax capacity retained by the
authority, the captured net tax capacity shared with other
taxing districts, the tax increment received, and any additional
information necessary to demonstrate compliance with any
applicable tax increment financing plan.
(b) An annual statement showing the tax increment received
and expended in that year, the original net tax capacity,
captured net tax capacity, amount of outstanding bonded
indebtedness, the amount of the district's and any subdistrict's
increments paid to other governmental bodies, the amount paid
for administrative costs, the sum of increments paid, directly
or indirectly, for activities and improvements located outside
of the district, and any additional information the authority
deems necessary shall be published in a newspaper of general
circulation in the municipality. If the fiscal disparities
contribution for the district is computed under section 469.177,
subdivision 3, paragraph (a), the annual statement must disclose
that fact and indicate the amount of increased property tax
imposed on other properties in the municipality as a result of
the fiscal disparities contribution. The commissioner of
revenue shall prescribe the form of this statement and the
method for calculating the increased property taxes. The
authority must publish the annual statement for a year no later
than July 1 of the next year. The authority must provide a copy
of the annual statement to the state auditor by the time it
submits it for publication.
Sec. 13. Minnesota Statutes 1995 Supplement, section
469.175, subdivision 6, is amended to read:
Subd. 6. [FINANCIAL REPORTING.] (a) The state auditor
shall develop a uniform system of accounting and financial
reporting for tax increment financing districts. The system of
accounting and financial reporting shall, as nearly as possible:
(1) provide for full disclosure of the sources and uses of
public funds in the district;
(2) permit comparison and reconciliation with the affected
local government's accounts and financial reports;
(3) permit auditing of the funds expended on behalf of a
district, including a single district that is part of a
multidistrict project or that is funded in part or whole through
the use of a development account funded with tax increments from
other districts or with other public money;
(4) be consistent with generally accepted accounting
principles.
(b) The authority must annually submit to the state
auditor, on or before July 1, a financial report in compliance
with paragraph (a). Copies of the report must also be provided
to the county and school district boards and to the governing
body of the municipality, if the authority is not the
municipality. To the extent necessary to permit compliance with
the requirement of financial reporting, the county and any other
appropriate local government unit or private entity must provide
the necessary records or information to the authority or the
state auditor as provided by the system of accounting and
financial reporting developed pursuant to paragraph (a).
(c) The annual financial report must also include the
following items:
(1) the original net tax capacity of the district and any
subdistrict;
(2) the captured net tax capacity of the district,
including the amount of any captured net tax capacity shared
with other taxing districts;
(3) for the reporting period and for the duration of the
district, the amount budgeted under the tax increment financing
plan, and the actual amount expended for, at least, the
following categories:
(i) acquisition of land and buildings through condemnation
or purchase;
(ii) site improvements or preparation costs;
(iii) installation of public utilities, parking facilities,
streets, roads, sidewalks, or other similar public improvements;
(iv) administrative costs, including the allocated cost of
the authority;
(v) public park facilities, facilities for social,
recreational, or conference purposes, or other similar public
improvements;
(4) for properties sold to developers, the total cost of
the property to the authority and the price paid by the
developer; and
(5) the amount of increments rebated or paid to developers
or property owners for privately financed improvements or other
qualifying costs.
(d) The reporting requirements imposed by this subdivision
apply to districts certified before, on, and after August 1,
1979.
Sec. 14. Minnesota Statutes 1995 Supplement, 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 local tax
rates. The county auditor must report to the commissioner of
children, families, and learning 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. 15. Minnesota Statutes 1994, section 469.176,
subdivision 4f, is amended to read:
Subd. 4f. [INTEREST REDUCTION.] Revenues derived from tax
increment may be used to finance the costs of an interest
reduction program operated pursuant to section 469.012,
subdivisions 7 to 10, or pursuant to other law granting interest
reduction authority and power by reference to those subdivisions
only under the following conditions: (1) tax increments may not
be collected for a program for a period in excess of 12 15 years
after the date of the first interest rate reduction payment for
the program, (2) tax increments may not be used for an interest
reduction program, if the proceeds of bonds issued pursuant to
section 469.178 after December 31, 1985, have been or will be
used to provide financial assistance to the specific project
which would receive the benefit of the interest reduction
program, and (3) tax increments may not be used to finance an
interest reduction program for owner-occupied single-family
dwellings.
Sec. 16. Minnesota Statutes 1995 Supplement, section
469.176, subdivision 7, is amended to read:
Subd. 7. [PARCELS NOT INCLUDABLE IN DISTRICTS.] (a) The
authority may not request inclusion in a tax increment financing
district and the county auditor may not certify the original tax
capacity of the following:
(1) a parcel or a part of a parcel that qualified under the
provisions of section 273.111 or 273.112 or chapter 473H for
taxes payable in any of the five calendar years before the
filing of the request for certification, if the parcel is
located in the metropolitan area, as defined in section 473.121;
or
(2) a parcel or a part of a parcel, located outside of the
metropolitan area, as defined in section 473.121, that qualified
under the provisions of section 273.111 or 273.112 for taxes
payable in any of the five calendar years before the request for
certification, if the district is not only for
(1) a district in which 85 percent or more of the planned
buildings and facilities (determined on the basis of square
footage) are for manufacturing or production of tangible
personal property, including processing resulting in the change
in condition of the property; or
(2) a qualified housing district as defined in section
273.1399, subdivision 1.
Sec. 17. Minnesota Statutes 1994, section 469.1761,
subdivision 1, is amended to read:
Subdivision 1. [REQUIREMENT IMPOSED.] In order for a tax
increment financing district to qualify as a housing district,
the income limitations provided in this section must be
satisfied. The requirements imposed by this section apply to
residential property receiving assistance financed with tax
increments, including interest reduction, land transfers at less
than the authority's cost of acquisition, utility service or
connections, roads, or other subsidies. The provisions of this
section do not apply (1) to interest reduction programs,
provided that the duration of the district is limited to 12
years from the collection of the first increment or (2) to
districts located in a targeted area as defined in section
462C.02, subdivision 9, clause (e).
Sec. 18. Minnesota Statutes 1994, section 471.88,
subdivision 14, is amended to read:
Subd. 14. [HOUSING AND REDEVELOPMENT AUTHORITY LOCAL
DEVELOPMENT ORGANIZATION.] (a) For the purposes of this
subdivision:
(1) "local development organization" means a housing and
redevelopment authority, economic development authority,
community action program, port authority, or private consultant;
and
(2) "government unit" has the meaning given in section
471.59, subdivision 1.
(b) When a county or multicounty housing and redevelopment
authority local development organization administers a loan or
grant program for individual residential property owners within
the geographical boundaries of a government unit by an agreement
entered into by the government unit and the housing and
redevelopment authority local development organization, an
officer of the government unit may apply for a loan or grant
from the housing and redevelopment authority local development
organization. If an officer applies for a loan or grant, the
officer must disclose as part of the official minutes of a
public meeting of the governmental unit that the officer has
applied for a loan or grant.
Sec. 19. Minnesota Statutes 1994, section 473.608, is
amended by adding a subdivision to read:
Subd. 12a. [REVENUE BONDS.] (a) The commission may issue
general airport revenue bonds, special facilities bonds, and
passenger facility charge bonds to fund:
(1) airports and air navigation facilities;
(2) other capital improvements at airports managed by the
commission;
(3) noise abatement and natural resource protection
measures, regardless of location and ownership;
(4) transportation and parking improvements related to
airports managed by the commission, regardless of location; and
(5) the refund of any outstanding obligations of the
commission.
The commission may secure the bonds with available revenue
in accordance with generally accepted public financial practices
under a resolution of the commission or trust indenture for the
bonds. The bonds may not be secured by the full faith and
credit of the commission or a pledge of the taxing authority of
the commission or of any city in or for which the commission has
been created.
(b) The commission shall notify the commissioner of
finance, the chair of the taxes committee of the House of
Representatives, and the chair of the taxes and tax laws
committee of the Senate of any proposal to issue bonds under
this subdivision and provide them an opportunity to review the
proposal.
(c) The commission may obligate itself to establish,
revise, and collect rates, fees, charges, and rentals for all
airport and air navigation facilities used by or made available
to any person, firm, association, or corporation to produce
revenues sufficient:
(1) to pay principal and interest on all obligations of the
commission;
(2) to fund reserves for the bonds;
(3) to pay other commission expenses in accordance with law.
(d) (1) Any pledge of revenues under this section is
subordinate to the pledge of current revenues to cancel taxes
levied for general obligation revenue bonds issued under section
473.665.
(2) Subject to clause (1), if the bonds meet the conditions
of section 473.667, subdivision 7, the commission may pledge
revenues to the revenue bonds issued under this subdivision on a
parity with the pledge of revenues to general obligation revenue
bonds issued under section 473.667. The pledge of revenues to
revenue bonds issued under this subdivision may be prior to the
obligation under section 473.667, subdivision 6, to repay any
deficiency taxes levied for general obligation revenue bonds.
(3) The commission may pledge revenues of any discrete
facility or portions of the airport and air navigation
facilities of the commission to the bonds. The commission may
establish reserves from any available funds or the proceeds of
the bonds and may make other covenants as it deems necessary to
protect the holders of the bonds. Passenger facility charge
bonds may pledge receipts from passenger facility charges
separately or together with a pledge of other revenues.
(e) The commission may use any powers under chapter 475,
except the power to issue general obligation bonds.
Sec. 20. Laws 1995, chapter 264, article 5, section 40,
subdivision 1, is amended to read:
Subdivision 1. [AUTHORIZATION.] Notwithstanding the
provisions of Minnesota Statutes, section 469.175, subdivision
4, paragraph (b), the economic development authority of the city
of Morris may, within one year after the effective date of this
section, enlarge the geographic area of tax increment financing
district No. 5 to include a parcel identified as lot 2, block 2
3, Stevens county - Morris industrial park. The district is
established under and subject to Minnesota Statutes, sections
469.174 to 469.178, except:
(1) the duration limit for the district and enlarged area
is December 31, 2005; and
(2) the buildings to be constructed in the enlarged
geographic area of the district may, notwithstanding the
provisions of Minnesota Statutes, section 469.176, subdivision
4c, include space necessary for and related to the manufacturing
facility located on parcels contiguous to the district. The
maximum space for nonmanufacturing uses may not exceed 40
percent of the square footage of the buildings. This test may
be applied based on a two-year test period.
Sec. 21. Laws 1995, chapter 264, article 5, section 44,
subdivision 4, is amended to read:
Subd. 4. [AUTHORITY.] For housing replacement projects in
the city of Crystal, "authority" means the Crystal economic
development authority. For housing replacement projects in the
city of Fridley, "authority" means the housing and redevelopment
authority in and for the city of Fridley or a successor in
interest. For housing replacement projects in the city of
Minneapolis, "authority" means the Minneapolis community
development agency. For housing replacement projects in the
city of St. Paul, "authority" means the St. Paul housing and
redevelopment authority. For housing replacement projects in
the city of Duluth, "authority" means the Duluth economic
development authority. For housing replacement projects in the
city of Richfield, "authority" is the authority as defined in
Minnesota Statutes, section 469.174, subdivision 2, that is
designated by the governing body of the city of Richfield.
Sec. 22. Laws 1995, chapter 264, article 5, section 45,
subdivision 1, is amended to read:
Subdivision 1. [CREATION OF PROJECTS.] (a) An authority
may create a housing replacement project under sections 44 to
47, as provided in this section.
(b) For the cities of Crystal and, Fridley, and Richfield,
the authority may designate up to 50 parcels in the city to be
included in a housing replacement district. No more than ten
parcels may be included in year one of the district, with up to
ten additional parcels added to the district in each of the
following nine years. For the cities of Minneapolis and, St.
Paul, and Duluth, each authority may designate up to 100 parcels
in the city to be included in a housing replacement district
over the life of the district. The only parcels that may be
included in a district are (1) vacant sites, (2) parcels
containing vacant houses, or (3) parcels containing houses that
are structurally substandard, as defined in Minnesota Statutes,
section 469.174, subdivision 10.
(c) The city in which the authority is located must pay at
least 25 percent of the housing replacement project costs from
its general fund, a property tax levy, or other unrestricted
money, not including tax increments.
(d) The housing replacement district plan must have as its
sole object the acquisition of parcels for the purpose of
preparing the site to be sold for market rate housing. As used
in this section, "market rate housing" means housing that has a
market value that does not exceed 150 percent of the average
market value of single-family housing in that municipality.
Sec. 23. [SOUTH ST. PAUL; TAX INCREMENT DISTRICT.]
Subdivision 1. [EXPENDITURE OF TAX
INCREMENTS.] Notwithstanding the provisions of Minnesota
Statutes, section 469.176, subdivision 1c, the city of South St.
Paul may expend tax increments derived from the Concord street
redevelopment tax increment financing district to pay debt
service on or defease general obligation tax increment bonds
issued to refund tax increment bonds of the city issued before
April 1, 1990, provided the average maturity of the refunding
bonds does not exceed the average maturity of the refunded bonds
by more than two years and provided further that the refunding
does not increase the amount of debt service to be paid after
April 1, 2001.
Subd. 2. [EFFECTIVE DATE.] Subdivision 1 is effective upon
compliance by the South St. Paul city council with Minnesota
Statutes, section 645.021, subdivision 2.
Sec. 24. [CITY OF WOODBURY; TAX INCREMENT FINANCING
DISTRICT.]
Subdivision 1. [EXTENSION.] Notwithstanding the provisions
of Minnesota Statutes, section 469.176, subdivision 1b, tax
increment may be paid until December 31, 2006, from the
following parcels identified as parcel identification numbers,
plat and parcel numbers in an existing tax increment economic
development district in the city of Woodbury: 73701-2025;
72003-3350; 72003-2350; 72003-2250; 72003-2100; 73701-2050;
73701-2075; 73701-2100; 73701-2125; 73701-2150; 72003-2550;
72003-2500; 73445-2000; and 73445-2050.
Subd. 2. [EFFECTIVE DATE.] Subdivision 1 is effective upon
compliance with Minnesota Statutes, sections 469.1782,
subdivision 2, and 645.021, subdivision 3.
Sec. 25. [CITY OF BRECKENRIDGE; TAX INCREMENT DISTRICT.]
Subdivision 1. [EXTENSION.] Notwithstanding the provisions
of Minnesota Statutes, section 469.176, subdivision 1c, the
duration of the city of Breckenridge tax increment financing
district number 1-1 may be extended by resolution of the
Breckenridge city council until April 1, 2009. The provisions
of Minnesota Statutes, sections 469.1782, subdivision 1, and
273.1399, subdivision 8, do not apply to the extension of the
duration of the district under this section.
Subd. 2. [EFFECTIVE DATE; APPROVAL.] Subdivision 1 is
effective the day after compliance with Minnesota Statutes,
sections 469.1782, subdivision 2, and 645.021, subdivision 2.
Sec. 26. [CITY OF MOUNTAIN IRON HOUSING AND REDEVELOPMENT
AUTHORITY; TAX INCREMENT DISTRICTS.]
Subdivision 1. [ORIGINAL NET TAX
CAPACITY.] Notwithstanding the provisions of the county
auditor's certification issued pursuant to Minnesota Statutes,
section 469.177, the original net tax capacity of property
described as plat number 71, parcel numbers 1212, 1213, and 1223
in tax increment financing district No. 6 located in the city of
Mountain Iron shall be deemed $6,407 as of January 1, 1996.
Subd. 2. [EXTENSION.] Notwithstanding the provisions of
Minnesota Statutes, section 469.176, subdivision 4c, the housing
and redevelopment authority in and for the city of Mountain Iron
may collect and expend tax increments generated by the Sawmill
restaurant project in tax increment financing district No. 6
located in the city of Mountain Iron after August 7, 1999, for
eligible activities within the district. The authority under
this subdivision expires August 7, 2004.
Subd. 3. [LOCAL APPROVAL.] Subdivisions 1 and 2 are
effective upon compliance with Minnesota Statutes, sections
469.1782, and 645.021, subdivision 3.
Sec. 27. [AUTHORITY TO ELECT LOCAL CONTRIBUTIONS.]
Notwithstanding the provisions of Laws 1995, chapter 264,
article 5, section 49, a city may elect to make local
contributions under Minnesota Statutes, section 273.1399,
subdivision 6, paragraph (d), in lieu of the state aid
reduction, if the following conditions are satisfied:
(1) the district was certified after April 30, 1994;
(2) the municipality and the authority agree to decertify
the district at least three years before the expiration of the
district's duration limit under Minnesota Statutes, section
469.176, subdivision 1b;
(3) the municipality makes an irrevocable election to make
local contributions and to be governed by clause (2) by December
31, 1996; and
(4) the authority notifies the commissioner of revenue of
the election by January 31, 1997.
Sec. 28. [DEFINITIONS.]
Subdivision 1. [AUTHORITY.] "Authority" means the Brooklyn
Park economic development authority.
Subd. 2. [DISTRESSED RENTAL PROPERTIES.] (a) "Distressed
rental properties," "distressed rental property," "property," or
"properties" means those multifamily rental projects located
within the city of Brooklyn Park which meet:
(1) both of the following:
(i) are 20 years old or older at the time of the request
for certification; and
(ii) are determined by the authority to be in need of
substantial rehabilitation or demolition; and
(2) one of the following:
(i) have a vacancy rate as established by rental records of
the owner, which has averaged at least 25 percent over the
five-year period preceding the request for certification;
(ii) have an estimated market value determined by the
assessor which has decreased by at least 20 percent over the
five-year period preceding the request for certification; or
(iii) were converted from home ownership to rental housing.
(b) Buildings located on contiguous properties, which are
commonly owned and financed, and which were constructed at
approximately the same time constitute a single distressed
rental property.
Subd. 3. [CAPTURED NET TAX CAPACITY.] "Captured net tax
capacity" means the amount by which the current net tax capacity
of the distressed housing district exceeds the original net tax
capacity including the value of property normally taxable as
personal property by reason of its location or over property
owned by a tax-exempt entity.
Subd. 4. [ORIGINAL NET TAX CAPACITY.] With respect to
distressed rental properties which according to the distressed
housing district plan are to be rehabilitated, "original net tax
capacity" means (i) the net tax capacity of the properties as
certified by the commissioner of revenue for the appropriate
assessment year minus (ii) all estimated costs associated with
rehabilitating said properties as set forth in the distressed
housing plan, but (iii) not less than zero. With respect to
distressed rental properties which according to the distressed
housing district plan are to be demolished, "original net tax
capacity" means the net tax capacity of the land only as
certified by the commissioner of revenue for the appropriate
assessment year. For purposes of this subdivision, the
appropriate assessment year shall be the previous assessment
year, provided that a request by the authority for certification
has been made to the county auditor by June 30. If the request
for certification is filed after June 30, the appropriate
assessment year shall be the current assessment year.
Subd. 5. [SUBSTANTIAL REHABILITATION.] "Substantial
rehabilitation" means rehabilitation, as defined in Minnesota
Statutes, section 462C.02, subdivision 8, in an amount of at
least $7,000 per unit.
Sec. 29. [ESTABLISHMENT OF A DISTRESSED HOUSING DISTRICT.]
Subdivision 1. [CREATION.] The authority may establish a
distressed housing district within the city which may contain
not more than five distressed rental properties. The distressed
rental properties need not be contiguous and may all be included
when establishing the district, or may be added from time to
time as described in subdivision 4, clause (2), provided that no
distressed rental property shall be added to the district after
five years from the date of the initial request for
certification of the district.
Subd. 2. [TAX INCREMENT.] Minnesota Statutes, section
469.177, subdivisions 1, paragraphs (a), (d), and (g), 1a, and 3
to 10, apply to the computation of tax increment for the
distressed housing district created under sections 28 to 31.
Subd. 3. [DISTRESSED HOUSING DISTRICT PLAN.] To establish
a distressed housing district, the authority shall adopt a
distressed housing plan that contains:
(1) a description of the distressed rental properties to be
included in the district to the extent known at the time the
plan is prepared, including identification of the current and
proposed owner of the property. If the maximum allowable number
of distressed rental properties are not included in the district
initially, a description of the criteria that will be used by
the authority to select properties to be included later;
(2) a general description of the types of substantial
rehabilitation or demolition which will be undertaken, and by
whom; and
(3) estimates of the following:
(i) total cost of substantial rehabilitation or demolition
for each distressed rental property included in the district,
including public administrative costs and relocation expenses;
(ii) sources of revenue, public and private, to pay the
estimated costs of substantial rehabilitation or demolition;
(iii) the most recent net tax capacity of each distressed
rental property included in the district;
(iv) the estimated captured net tax capacity of each
distressed rental property included in the district, at
completion; and
(v) the authority's alternate estimates of the impact of
the distressed housing district on the net tax capacities of all
taxing jurisdictions in which the distressed housing district is
located in whole or in part. For purposes of one statement, the
authority shall assume that the estimated captured net tax
capacity would be available to the taxing jurisdictions without
creation of the distressed housing district and for purposes of
the second statement the authority shall assume that none of the
estimated captured net tax capacity would be available to the
taxing jurisdictions without creation of the distressed housing
district.
Subd. 4. [PROCEDURE.] Minnesota Statutes, section 469.175,
subdivisions 3 to 6a, apply to the establishment and operation
of the distressed housing district created under sections 28 to
31, except as follows:
(1) the determination required in Minnesota Statutes,
section 469.175, subdivision 3, clause (1), is not required; and
(2) the addition to the district of distressed rental
properties not identified in the original distressed housing
district plan is not a modification of the plan requiring
notice, public hearing, findings, or approval if the addition of
the distressed rental properties is consistent with the criteria
described in subdivision 3, clause (1).
Subd. 5. [LOCAL CONTRIBUTION.] The city of Brooklyn Park
must pay at least five percent of the distressed housing
district project costs from its general fund, a property tax
levy, or other unrestricted money, not including tax increments.
Sec. 30. [LIMITATIONS.]
Subdivision 1. [DURATION.] Tax increment generated by each
distressed rental property included in the district shall cease
to be paid to the authority after the expiration of 15 years
from the receipt by the county of the first tax increment from
that property.
Subd. 2. [USE.] (a) All tax increment received by the
authority from the district shall be used in accordance with the
distressed housing district plan.
(b) Tax increment may be used to pay the costs of:
(1) acquiring title to or an ownership interest in a
distressed rental property;
(2) relocation of tenants residing in a distressed rental
property;
(3) demolition of all or a part of a distressed rental
property;
(4) substantial rehabilitation of a distressed rental
property;
(5) public improvements associated with the substantial
rehabilitation or demolition of distressed housing properties;
and
(6) the costs of the authority in administering the
creation and operation of the district.
(c) The authority may pay the costs of substantial
rehabilitation or demolition of the distressed rental properties
directly, through the issuance and sale of obligations pursuant
to Minnesota Statutes, section 469.178, by means of loans or
grants to the owners of such properties, or through the exercise
of any authority contained in Minnesota Statutes, sections
469.090 to 469.1081.
(d) Tax increment received by the authority in excess of
that needed to pay the costs described in paragraph (b), clause
(2), shall be deposited into the housing account established by
the authority pursuant to Laws 1994, chapter 587, article 9,
section 20.
Subd. 3. [RELOCATION.] As part of the acquisition of any
distressed rental property by the authority, the authority shall
comply with the provisions of the Uniform Relocation Assistance
and Real Property Acquisition Policies Act of 1970, United
States Code, title 42, sections 4601 to 4655, and regulations
adopted thereunder and existing on the effective date of this
act. The authority shall also retain a professional relocation
consultant to assist families in finding suitable replacement
housing.
Sec. 31. [APPLICABILITY OF OTHER LAWS.]
References in Minnesota Statutes to tax increment financing
districts created and tax increment generated under Minnesota
Statutes, sections 469.174 to 469.179, except for references in
Minnesota Statutes, section 273.1399, include the distressed
housing district and tax increment subject to sections 28 to 31.
Minnesota Statutes, sections 469.174 to 469.179, apply only to
the extent specified in sections 28 to 31. The distressed
housing district does not have a longer duration than permitted
by general law for purposes of Minnesota Statutes, section
469.1782.
Sec. 32. [ENTERPRISE ZONE ALLOCATION; CITY OF DULUTH.]
In addition to tax reductions authorized by other law, the
commissioner of trade and economic development may allocate
$300,000 for tax reductions pursuant to Minnesota Statutes,
section 469.171, subdivision 1, for a financial services
facility of at least 100,000 square feet located in the city of
Duluth. This amount is not subject to any funding limitations
or maximum allocation limitations under Minnesota Statutes,
section 469.169, subdivision 7. The tax reductions may be
provided until the allocation under this section has been
expended.
Sec. 33. [APPLICATION.]
Section 19 applies in Anoka, Carver, Dakota, Hennepin,
Ramsey, Scott, and Washington counties.
Sec. 34. [REPEALER.]
Minnesota Statutes 1994, sections 13.99, subdivision 97;
and 469.150, are repealed.
Sec. 35. [EFFECTIVE DATE.]
Sections 3 and 4 are effective for all tax increment
financing districts and subdistricts for which an election was
or is made under Minnesota Statutes, section 273.1399,
subdivision 6, paragraph (d), except the amendment in section 3
adding paragraph (d), clause (3), item (B) applies to elections
made after the day following final enactment.
Sections 5 to 8 are effective the day following final
enactment for border city enterprise zones existing on that date.
Section 12 is effective beginning for annual statements
required to be published for calendar year 1995.
Sections 10, 11, 13, and 14 are effective the day following
final enactment and apply to all tax increment financing
districts for which the request for certification was made after
August 1, 1979.
Sections 15 and 17 are effective for districts for which
the request for certification is made after April 30, 1996. For
districts for which the request for certification was made
before May 1, 1996, the governing body of the development
authority may elect, by resolution, to be governed by the
provisions of sections 15 and 17. The election is irrevocable
and must be made no later than December 31, 1996.
Notwithstanding the provisions of Minnesota Statutes,
section 469.1782, subdivision 2, section 20 is effective without
local approval on the effective date of Laws 1995, chapter 264,
article 5, section 40.
Sections 21 and 22 are effective for the city of Duluth on
the day the chief clerical officer of the city of Duluth
complies with Minnesota Statutes, section 645.021, subdivision 3
and are effective for the city of Richfield on the day the chief
clerical officer of the city of Richfield complies with
Minnesota Statutes, section 645.021, subdivision 3.
Sections 28 to 31 are effective the day following final
enactment and upon compliance by the governing body of Brooklyn
Park with Minnesota Statutes, section 645.021, subdivision 3.
ARTICLE 8
SPECIAL TAXING DISTRICTS
Section 1. [103D.729] [WATER MANAGEMENT DISTRICT.]
Subdivision 1. [WATER MANAGEMENT DISTRICT.] A watershed
district may establish a water management district or districts
in the territory within the watershed, for the purpose of
collecting revenues and paying the costs of projects initiated
under section 103B.231, 103D.601, 103D.605, 103D.611, or
103D.730.
Subd. 2. [PROCEDURE.] A watershed district may establish a
water management district only by amendment to its plan in
accordance with section 103D.411, or 103B.231 for watershed
districts in the metropolitan area, and compliance with
subdivisions 3 and 4. The amendment shall describe with
particularity the territory or the area to be included in the
water management district, the amount of the necessary charges,
the methods used to determine charges, and the length of time
the water management district will remain in force. After
adoption the amendment shall be filed with the county auditor
and county recorder of each county affected by the water
management district. The water management district may be
dissolved by the procedure prescribed for the establishment of
the water management district.
Subd. 3. [NOTIFICATION.] The managers shall, ten days
prior to a hearing or decision on projects implemented under
this section, provide notice to the city, town, or county within
the affected area. The city, town, or county receiving notice
shall submit to the managers' concerns relating to the
implementation of the project. The managers shall consider the
concerns of the city, town, or county in the decision on the
project.
Subd. 4. [RESOLUTION OF DISPUTES.] Unresolved differences
between local governments and the managers may be brought before
the committee on dispute resolution under section 103B.101,
subdivision 10. Within 45 days of receiving the request for
dispute resolution, the committee must consider the concerns of
the local government. The committee has 30 days after meeting
to issue a recommendation to the board for final decision.
Sec. 2. [103D.730] [STORM WATER FACILITIES.]
(a) Any watershed district may build, construct,
reconstruct, repair, enlarge, improve, or in any other manner
obtain storm water systems, including mains, holding areas and
ponds, and other appurtenances and related facilities for the
collection and disposal of storm water, maintain and operate the
facilities, and acquire by gift, purchase, lease, condemnation,
or otherwise any and all land and easements required for that
purpose.
(b) The authority granted is in addition to all other
powers with reference to the facilities otherwise granted by the
laws of this state or by this chapter.
Sec. 3. Minnesota Statutes 1994, section 428A.01,
subdivision 2, is amended to read:
Subd. 2. [CITY.] "City" means the city in which the
special service district is authorized to be established under a
special law a home rule charter or statutory city.
Sec. 4. Minnesota Statutes 1994, section 428A.01,
subdivision 3, is amended to read:
Subd. 3. [SPECIAL SERVICES.] "Special services" has the
meaning given in the city's enabling legislation. ordinance but
special services do may not include a service that is ordinarily
provided throughout the city from general fund revenues of the
city unless an increased level of the service is provided in the
special service district.
Sec. 5. Minnesota Statutes 1994, section 428A.02,
subdivision 1, is amended to read:
Subdivision 1. [ORDINANCE.] The governing body of the a
city may adopt an ordinance establishing a special service
district. Only property that is classified under section 273.13
and used for commercial, industrial, or public utility purposes,
or is vacant land zoned or designated on a land use plan for
commercial or industrial use and located in the special service
district, may be subject to the charges imposed by the city on
the special service district. Other types of property may be
included within the boundaries of the special service district
but are not subject to the levies or charges imposed by the city
on the special service district. If 50 percent or more of the
market value of a parcel of property is classified under section
273.13 as commercial, industrial, or vacant land zoned or
designated on a land use plan for commercial or industrial use,
or public utility for the current assessment year, then the
entire market value of the property is subject to a service
charge based on net tax capacity for purposes of sections
428A.01 to 428A.10. The ordinance shall describe with
particularity the area within the city to be included in the
district and the special services to be furnished in the
district. The ordinance may not be adopted until after a public
hearing has been held on the question. Notice of the hearing
shall include the time and place of hearing, a map showing the
boundaries of the proposed district, and a statement that all
persons owning property in the proposed district that would be
subject to a service charge will be given opportunity to be
heard at the hearing. Within 30 days after adoption of the
ordinance under this subdivision, the governing body shall send
a copy of the ordinance to the commissioner of revenue.
Sec. 6. [428A.101] [SPECIAL SERVICE DISTRICT; SUNSET OF
SELF-EXECUTING PROVISIONS.]
The establishment of a new special service district after
June 30, 2001, must be made pursuant to enabling legislation
under Minnesota Statutes 1994, sections 428A.01 to 428A.10.
Sec. 7. [428A.11] [HOUSING IMPROVEMENT AREAS;
DEFINITIONS.]
Subdivision 1. [APPLICABILITY.] As used in sections
428A.11 to 428A.20, the terms defined in this section have the
meanings given them.
Subd. 2. [CITY.] "City" means a home rule charter or
statutory city.
Subd. 3. [ENABLING ORDINANCE.] "Enabling ordinance" means
the ordinance adopted by the city council establishing the
housing improvement area.
Subd. 4. [HOUSING IMPROVEMENTS.] "Housing improvements"
has the meaning given in the city's enabling ordinance. Housing
improvements may include improvements to common elements of a
condominium.
Subd. 5. [HOUSING IMPROVEMENT AREA.] "Housing improvement
area" means a defined area within the city where housing
improvements are made or constructed and the costs of the
improvements are paid in whole or in part from fees imposed
within the area.
Subd. 6. [HOUSING UNIT.] "Housing unit" means real
property and improvements thereon consisting of a one-dwelling
unit, or an apartment as described in chapter 515 or 515A, that
is occupied by a person or family for use as a residence.
Sec. 8. [428A.12] [PETITION REQUIRED.]
No action may be taken under sections 428A.13 and 428A.14
unless owners of 25 percent or more of the housing units that
would be subject to fees in the proposed housing improvement
area file a petition requesting a public hearing on the proposed
action with the city clerk. No action may be taken under
section 428A.14 to impose a fee unless owners of 25 percent or
more of the housing units subject to the proposed fee file a
petition requesting a public hearing on the proposed fee with
the city clerk or other appropriate official.
Sec. 9. [428A.13] [ESTABLISHMENT OF HOUSING IMPROVEMENT
AREA.]
Subdivision 1. [ORDINANCE.] The governing body of the city
may adopt an ordinance establishing a housing improvement area.
The ordinance must specifically describe the portion of the city
to be included in the area, the basis for the imposition of the
fees, and the number of years the fee will be in effect. In
addition, the ordinance must include findings that without the
housing improvement area, the proposed improvements could not be
made by the condominium associations or housing unit owners, and
the designation is needed to maintain and preserve the housing
units within the housing improvement area. The ordinance may
not be adopted until a public hearing has been held regarding
the ordinance. The ordinance may be amended by the governing
body of the city, provided the governing body complies with the
public hearing notice provisions of subdivision 2. Within 30
days after adoption of the ordinance under this subdivision, the
governing body shall send a copy of the ordinance to the
commissioner of revenue.
Subd. 2. [PUBLIC HEARING.] The notice of public hearing
must include the time and place of hearing, a map showing the
boundaries of the proposed area, and a statement that all
persons owning housing units in the proposed area that would be
subject to a fee for housing improvements will be given an
opportunity to be heard at the hearing. Notice of the hearing
must be given by publication in the official newspaper of the
city. The public hearing must be held at least seven days after
the publication. Not less than ten days before the hearing,
notice must also be mailed to the owner of each housing unit
within the proposed area. For the purpose of giving mailed
notice, owners are those shown on the records of the county
auditor. Other records may be used to supply the necessary
information. At the public hearing a person owning property in
the proposed housing improvement area may testify on any issues
relevant to the proposed area. The hearing may be adjourned
from time to time. The ordinance establishing the area may be
adopted at any time within six months after the date of the
conclusion of the hearing by a vote of the majority of the
governing body of the city.
Subd. 3. [PROPOSED HOUSING IMPROVEMENTS.] At the public
hearing held under subdivision 2, the city shall provide a
preliminary listing of the housing improvements to be made in
the area. The listing shall identify those improvements, if
any, that are proposed to be made to all or a portion of the
common elements of a condominium. The listing shall also
identify those housing units that have completed the proposed
housing improvements and are proposed to be exempted from a
portion of the fee. In preparing the list the city shall
consult with the residents of the area and the condominium
associations.
Subd. 4. [BENEFIT; OBJECTION.] Before the ordinance is
adopted or at the hearing at which it is to be adopted, the
owner of a housing unit in the proposed housing improvement area
may file a written objection with the city clerk asserting that
the owner's property should not be included in the area or
should not be subjected to a fee and objecting to the inclusion
of the housing unit in the area, for the reason that the
property would not benefit from the improvements.
The governing body shall make a determination of the
objection within 60 days of its filing. Pending its
determination, the governing body may delay adoption of the
ordinance or it may adopt the ordinance with a reservation that
the landowner's property may be excluded from the housing
improvement area or fee when the determination is made.
Subd. 5. [APPEAL TO DISTRICT COURT.] Within 30 days after
the determination of the objection, any person aggrieved, who is
not precluded by failure to object before or at the hearing, or
whose failure to object is due to a reasonable cause, may appeal
to the district court by serving a notice upon the mayor or city
clerk. The notice shall be filed with the court administrator
of the district court within ten days after its service. The
city clerk shall furnish the appellant a certified copy of the
findings and determination of the governing body. The court may
affirm the action objected to or, if the appellant's objections
have merit, modify or cancel it. If the appellant does not
prevail upon the appeal, the costs incurred are taxed to the
appellant by the court and judgment entered for them. All
objections are deemed waived unless presented on appeal.
Sec. 10. [428A.14] [IMPROVEMENT FEES AUTHORITY; NOTICE AND
HEARING.]
Subdivision 1. [AUTHORITY.] Fees may be imposed by the
city on the housing units within the housing improvement area at
a rate, term, or amount sufficient to produce revenue required
to provide housing improvements in the area. The fee can be
imposed on the basis of the tax capacity of the housing unit, or
the total amount of square footage of the housing unit, or a
method determined by the council and specified in the resolution.
Before the imposition of the fees, a hearing must be held and
notice must be published in the official newspaper at least
seven days before the hearing and shall be mailed at least seven
days before the hearing to any housing unit owner subject to a
fee. For purposes of this section, the notice must also include:
(1) a statement that all interested persons will be given
an opportunity to be heard at the hearing regarding a proposed
housing improvement fee;
(2) the estimated cost of improvements including
administrative costs to be paid for in whole or in part by the
fee imposed under the ordinance;
(3) the amount to be charged against the particular
property;
(4) the right of the property owner to prepay the entire
fee;
(5) the number of years the fee will be in effect; and
(6) a statement that the petition requirements of section
428A.12 have either been met or do not apply to the proposed fee.
Within six months of the public hearing, the city may adopt
a resolution imposing a fee within the area not exceeding the
amount expressed in the notice issued under this section.
Prior to adoption of the resolution approving the fee, the
condominium associations located in the housing improvement area
shall submit to the city a financial plan prepared by an
independent third party, acceptable to the city and
associations, that provides for the associations to finance
maintenance and operation of the common elements in the
condominium and a long-range plan to conduct and finance capital
improvements.
Subd. 2. [LEVY LIMIT.] Fees imposed under this section are
not included in the calculation of levies or limits on levies
imposed under any law or charter.
Sec. 11. [428A.15] [COLLECTION OF FEES.]
The city may provide for the collection of the housing
improvement fees according to the terms of section 428A.05.
Sec. 12. [428A.16] [BONDS.]
At any time after a contract for the construction of all or
part of an improvement authorized under sections 428A.11 to
428A.20 has been entered into or the work has been ordered, the
governing body of the city may issue obligations in the amount
it deems necessary to defray in whole or in part the expense
incurred and estimated to be incurred in making the improvement,
including every item of cost from inception to completion and
all fees and expenses incurred in connection with the
improvement or the financing.
The obligations are payable primarily out of the proceeds
of the fees imposed under section 428A.14, or from any other
special assessments or revenues available to be pledged for
their payment under charter or statutory authority, or from two
or more of those sources. The governing body may, by resolution
adopted prior to the sale of obligations, pledge the full faith,
credit, and taxing power of the city to assure payment of the
principal and interest if the proceeds of the fees in the area
are insufficient to pay the principal and interest. The
obligations must be issued in accordance with chapter 475,
except that an election is not required, and the amount of the
obligations are not included in determination of the net debt of
the city under the provisions of any law or charter limiting
debt.
Sec. 13. [428A.17] [ADVISORY BOARD.]
The governing body of the city may create and appoint an
advisory board for the housing improvement area in the city to
advise the governing body in connection with the planning and
construction of housing improvements. In appointing the board,
the council shall consider for membership, members of
condominium associations located in the housing improvement
area. The advisory board shall make recommendations to the
governing body to provide improvements or impose fees within the
housing improvement area. Before the adoption of a proposal by
the governing body to provide improvements within the housing
improvement area, the advisory board of the housing improvement
area shall have an opportunity to review and comment upon the
proposal.
Sec. 14. [428A.18] [VETO POWERS.]
Subdivision 1. [NOTICE OF RIGHT TO FILE OBJECTIONS.] The
effective date of any ordinance or resolution adopted under
sections 428A.13 and 428A.14 must be at least 45 days after it
is adopted. Within five days after adoption of the ordinance or
resolution, a summary of the ordinance or resolution shall be
mailed to the owner of each housing unit included in the
multiunit housing improvement area. The mailing shall include a
notice that owners subject to a fee have a right to veto the
ordinance or resolution by filing the required number of
objections with the city clerk before the effective date of the
ordinance or resolution and that a copy of the ordinance or
resolution is on file with the city clerk for public inspection.
Subd. 2. [REQUIREMENTS FOR VETO.] If residents of 35
percent or more of the housing units in the area subject to the
fee file an objection to the ordinance adopted by the city under
section 428A.13 with the city clerk before the effective date of
the ordinance, the ordinance does not become effective. If
owners of 35 percent or more of the housing units' tax capacity
subject to the fee under section 428A.14 file an objection with
the city clerk before the effective date of the resolution, the
resolution does not become effective.
Sec. 15. [428A.19] [ANNUAL REPORTS.]
Each condominium association located within the housing
improvement area must, by August 15 annually, submit a copy of
its audited financial statements to the city. The city may
also, as part of the enabling ordinance, require the submission
of other relevant information from the associations.
Sec. 16. [428A.20] [SPECIAL ASSESSMENTS.]
Within a housing improvement area, the governing body of
the city may, in addition to the fee authorized in section
428A.14, special assess housing improvements to benefited
property. The governing body of the city may by ordinance adopt
regulations consistent with this section.
Sec. 17. [428A.21] [SUNSET.]
No new housing improvement areas may be established under
sections 428A.11 to 428A.20 after June 30, 2001. After June 30,
2001, a city may establish a housing improvement area, provided
that it receives enabling legislation authorizing the
establishment of the area.
Sec. 18. Minnesota Statutes 1994, section 444.075, is
amended by adding a subdivision to read:
Subd. 2a. [COLLECTION OF CHARGES BY WATERSHED
DISTRICTS.] (a) With respect to watershed districts, charges
established under section 103D.729 for the purpose of projects
under section 103D.730 may be billed and collected in a manner
the district shall determine, including certification to the
counties with territory within the district for collection by
the counties. A county may bill and collect the charges in a
manner the county board shall determine or as described in
paragraph (b).
(b) On or before October 15 in each year, the district or
county board may certify to the county auditor all unpaid
outstanding charges, and a description of the lands against
which the charges arose. The county auditor shall extend the
charges with interest not to exceed the interest rate provided
for in section 279.03, subdivision 1, upon the tax rolls of the
county for the taxes of the year in which the charge is filed.
For each year ending October 15 the charge with interest shall
be carried into the tax becoming due and payable in January of
the following year, and shall be enforced and collected in the
manner provided for the enforcement and collection of real
property taxes. The charges, if not paid, shall become
delinquent and subject to the same penalties and the same rate
of interest as real property taxes.
(c) Any individual may appeal the charges under section
103D.535.
Sec. 19. Laws 1963, chapter 118, section 1, subdivision 3,
is amended to read:
Subd. 3. For the purpose of this act, the term
"municipality" shall include cities, villages, and towns of the
hospital district, which are as follows: the cities of
Faribault, Nerstrand, and Morristown; and the townships of
Wheeling, Cannon City, Wells, Shieldsville, Morristown, Warsaw,
Walcott, and Richland.
Sec. 20. Laws 1963, chapter 118, section 2, is amended to
read:
Sec. 2. [HOSPITAL BOARD; APPOINTMENT; TERMS.]
Subdivision 1. The hospital district shall be governed by
a board of directors of nine voting members, hereinafter called
"hospital board", who shall be residents of the district,
appointed by the county board committee described under
subdivision 4. The members of the hospital board shall be
selected from the several municipalities forming a part of the
district, on the basis of population, so that, as nearly as
practicable, the most populous municipality shall have numerical
representation in proportion to its share of the total district
population.
Subd. 2. One third of the members of the first hospital
board shall be appointed for a term to expire one year from May
1 next following such appointment, one third for a term to
expire two years from such date, and one third for a term to
expire three years from such date. Successors to the original
board members shall each be appointed for terms of three years.
All members shall hold office until their successors are
appointed and qualify. Terms of all members shall expire on May
1. Members of the hospital board shall be appointed to a
three-year term, expiring on May 1. Terms of office must be
staggered so that one-third of the positions are up for
appointment each year. In case of a vacancy on the hospital
board, whether due to death, removal from the district
nonresidency, inability to serve, resignation, or other removal
for cause the county board, at its next regular or special
meeting, shall make an appointment to fill such vacancy shall be
made at a special meeting of the appointment committee for the
then unexpired term. Tenure of each board member is limited to
three successive three-year terms, or a total of nine successive
years, but a member may be reappointed after one year without
board membership. The hospital administrative staff shall
facilitate the appointment process, including an open
advertisement for hospital board vacancies.
Subd. 3. In addition to voting members, the hospital board
may add ex officio members to the board, but without voting
privilege. The hospital board shall adopt bylaws to provide
grounds and a procedure for removal of board members for cause
and may remove board members in accordance with the bylaws.
Subd. 4. All members of the hospital board at the time the
hospital district is reorganized shall continue in office until
the members of the first board of the reorganized district are
appointed and qualify. A five-member appointment committee of
elected officials representing the municipalities of the
hospital district shall be established each year. Two members
of the appointing committee shall be selected by the Faribault
city council. Two members of the appointing committee shall be
selected by the representatives of the other municipalities at
the hospital annual meeting. One county commissioner member,
whose constituency is made up of at least one-third of the city
of Faribault, shall be selected by the Rice county board.
Sec. 21. Laws 1963, chapter 118, section 4, is amended to
read:
Sec. 4. [MEETINGS OF THE BOARD.]
Subdivision 1. Regular meetings of the hospital board
shall be held at least once a month, at such time and place as
the board shall by resolution determine. Special meetings may
be held at any time upon the call of the chairman or of any two
other members, upon written notice mailed to each member three
days prior to the meeting, or upon such other notice as the
board, by resolution, may provide, or without notice, if each
member is present or files with the secretary a written consent
to the holding of the meeting, which consent may be filed before
or after the meeting. Any action within the authority of the
board may be taken by the vote of a majority of the members
present at a regular or adjourned meeting or at a duly called
special meeting if a quorum is present. A majority of all the
members of the board shall constitute a quorum, but a lesser
number may meet and adjourn from time to time.
Subd. 2. During the second half of each year, the hospital
board will convene an annual meeting to report to the citizens
of the hospital district on the state of the hospital. The
agenda will include a report by the chief executive officer on
the status of the hospital, future plans for the hospital, and
the hospital's financial condition, including the need for
revenues derived from the property tax levy. Each of the
municipalities shall send one official representative.
Sec. 22. Laws 1963, chapter 118, section 6, is amended to
read:
Sec. 6. [PAYMENT OF EXPENSES; TAXATION.]
Subdivision 1. Expenses of acquisition, betterment,
administration, operation, and maintenance of any hospital,
including nursing home facilities, operated by the hospital
district, shall be paid from the revenue derived therefrom and,
to the extent necessary, from ad valorem taxes levied by the
hospital board upon all taxable property situated within the
district. and, to the extent determined from time to time by
the county board of Rice county, from appropriations made by
said board in accordance with the provisions of Minnesota
Statutes 1961, Section 376.08, or any future laws authorizing
such appropriations. Any moneys so appropriated by such county
board for the acquisition or betterment of facilities of the
hospital district may be transferred, in the discretion of the
hospital board, to a sinking fund for bonds issued for that
purpose. The hospital board may agree to repay to the county
any sums so appropriated, out of the net revenues to be derived
from operation of its facilities, subject to such terms as may
be agreed upon. No taxes levied by the hospital district in any
year, other than taxes levied for payment of bonded
indebtedness, shall exceed a total of five mills, provided that
such limitation may be exceeded if the amount proposed to be
levied in excess of such millage against property in any
municipality within the district added to the levy of such
municipality would not cause such municipal levy to exceed the
limitations of Minnesota Statutes 1961, Section 275.10 or 275.11.
Subd. 2. On or before October 10 September 15 of each year
the hospital board shall determine certify to the county auditor
the total amount required to be raised from ad valorem tax levy
in order to meet estimated expenses during the ensuing year and
shall cause such amount to be certified to the county auditor to
be extended upon the tax rolls.
Subd. 3. The county auditor shall determine the millage
levy required and certify the same to the county treasurer for
collection with other taxes. The county treasurer shall make
settlement of such taxes with the treasurer of the hospital
district in the same manner as other taxes are distributed to
political subdivisions. The levies authorized by this section
shall be in addition to any other taxes authorized by law.
Subd. 4. The hospital board may levy up to 1.70 percent of
the hospital district's net tax capacity without the approval of
the Faribault city council and the governing bodies of the other
municipalities in the hospital district. Any amount of tax
levied by the hospital board in excess of 1.70 percent of the
hospital district's net tax capacity shall require ratification
by a majority vote of the Faribault city council and a majority
of the governing bodies of the other municipalities in the
hospital district. At the option of the hospital board, the
vote may occur at a specially scheduled joint meeting of all the
municipalities of the hospital district, or at the hospital's
annual meeting.
Sec. 23. Laws 1971, chapter 869, section 2, subdivision 2,
as amended by Laws 1973, chapter 632, section 1, is amended to
read:
Subd. 2. [ALEXANDRIA, CITY OF; SANITARY SEWER BOARD.]
"Alexandria Lake Area Sanitary District" and "district" mean the
area over which the sanitary sewer board has jurisdiction which
shall include all that part of Douglas county, Minnesota,
described as follows, to-wit:
(a) all of the city of Alexandria, Minnesota;
(b) the NW 1/4 of section 3, the SW 1/4 of section 3 except
the SE 1/4 thereof, all of sections 4, 5, 6, 7, 8, 9, 10, 15,
16, 17, 18, 19, 20 and 21, section 22 except the E 1/2 of the SE
1/4 thereof, the NW 1/4 and the W 1/2 of the NE 1/4 of section
27, section 28 except the E 1/2 of the SE 1/4 thereof, all of
sections 29, 30, 31 and 32, and section 33 except for the E 1/2
of the E 1/2 thereof all in township 128 north, range 37 west,
excepting that part of the foregoing territory already included
within the district by reason of its being within the corporate
limits of the city of Alexandria;
(c) all that part of the W 1/2 of section 4 and all of
section 5 lying north of the north right of way line of
Interstate Highway I-94, the and N 1/2 of section 6 all in
township 127 north, range 37 west, excepting that part of the
foregoing territory already included within the district by
reason of its being within the corporate limits of the city of
Alexandria;
(d) the SW 1/4 of section 10, the SW 1/4 of section 14, the
NW 1/4 and the S 1/2 of section 15, the S 1/2 and the NW 1/4 of
section 16, the S 1/2 of the NE 1/4 and the S 1/2 of section 17,
the E 1/2 of the E 1/2 of section 19, all of section 20, the W
1/2 of section 21, the N 1/2 of the NW 1/4 of section 23, the W
1/2 of section 28, all of section 29, the S 1/2 of the SE 1/4
and the E 1/2 of the E 1/2 of section 30, the E 1/2 of the NE
1/4 and all of the SE 1/4 of section 31, all of sections 32 and
33 and the SW 1/4 of section 34 all in township 129 north, range
37 west;
(e) all of sections 1 and 2, section 10 except the N 1/2 of
the NW 1/4 and the NW 1/4 of the NE 1/4 thereof, all of sections
11, 12, 13 and 14, section 15 except the SW 1/4 and the W 1/2 of
the SE 1/4 thereof, the E 1/2 of the NE 1/4 and all of the SE
1/4 of section 22, the SE 1/4 of the SW 1/4 of section 22, all
of sections 23, 24, 25 and 26, section 27 except the W 1/2 of
the NW 1/4 thereof, the SE 1/4 of section 28, the NE 1/4 of the
SE 1/4 of section 32, the SW 1/4, the NW 1/4, the NE 1/4 of
section 33 except the SW 1/4 thereof, and the NW 1/4 and the NW
1/4 of the NE 1/4 of section 34 all in township 128 north range
38 west, excepting that part of the foregoing territory already
included within the district by reason of its being within the
corporate limits of the city of Alexandria;
(f) such other territory within or without Douglas county,
Minnesota as may be included within the district pursuant to
section 21.
Sec. 24. Laws 1971, chapter 869, section 2, subdivision
14, is amended to read:
Subd. 14. "Municipality" means any city, village or town
located in whole or in part in the district.
Sec. 25. Laws 1971, chapter 869, section 2, subdivision
17, as added by Laws 1975, chapter 287, section 1, is amended to
read:
Subd. 17. [ALEXANDRIA, CITY OF; LAKE AREA; SANITARY
SEWERS.] "Agricultural property" means land as is classified
agricultural land within the meaning of Minnesota Statutes,
Section 273.13, Subdivision 6 23, paragraph (c).
Sec. 26. Laws 1971, chapter 869, section 3, subdivision 5,
is amended to read:
Subd. 5. [TERMS OF OFFICE.] The term of each of the first
board members shall expire on January 1 in a calendar year to be
determined in accordance with subdivision 2 by the governing
body selecting such member, provided that such term shall not
expire any later than January 1, 1975. Succeeding terms of all
board members shall be for one, two, three or four calendar
years to be determined in accordance with subdivision 2 by the
governing body selecting such member. Terms shall expire on
January 1 of a calendar year, except that each member shall
serve until his successor has been duly selected and qualified.
Sec. 27. Laws 1971, chapter 869, section 3, subdivision 6,
is amended to read:
Subd. 6. [REMOVAL.] A board member may be removed by the
unanimous vote of the appointing governing body appointing him,
with or without cause, or by the governor for malfeasance or
nonfeasance in the performance of his official duties as
provided by Minnesota Statutes, Sections 351.03 and 351.04.
Sec. 28. Laws 1971, chapter 869, section 3, subdivision 9,
is amended to read:
Subd. 9. [BOARD MEMBERS' COMPENSATION.] Each board member,
except the chairman, shall be paid a per diem compensation of
$25 for meetings and for such other services in such amount as
are specifically authorized by the board, from time to time.
Per diem compensation shall not to exceed $1,000 $4,000 in any
one year. The chairman shall be paid a per diem compensation of
$35 for meetings and for such other services as are specifically
authorized by the board, not to exceed $1,500 in any one year.
All members of the board shall be reimbursed for all reasonable
expenses incurred in the performance of their duties as
determined by the board.
Sec. 29. Laws 1971, chapter 869, section 4, subdivision 1,
is amended to read:
Subdivision 1. [ORGANIZATION; OFFICERS; MEETINGS; SEAL.]
After the selection and qualification of all board members, they
shall meet to organize the board at the call of any two board
members, upon seven days a notice by registered mail to the
remaining board members, at a time and place within the district
specified in the notice. A majority of the members shall
constitute a quorum at that meeting and all other meetings of
the board, but a lesser number may meet and adjourn from time to
time and compel the attendance of absent members. At the first
meeting the board shall select its officers as hereinafter
provided and conduct such other organizational business as may
be necessary. Thereafter The board shall meet regularly at such
time and place as the board shall by resolution designate.
Special meetings may be held at any time upon call of the
chairman or any two members, upon written notice sent by mail to
each member at least three days prior to the meeting, or upon
such other notice as the board by resolution may provide, or
without notice if each member is present or files with the
secretary a written consent to the meeting either before or
after the meeting. Except as otherwise provided in this act,
any action within the authority of the board may be taken by the
affirmative vote of a majority of the board may be taken by at a
regular or adjourned regular meeting or at a duly held special
meeting, but in any case only if a quorum is present. All
meetings of the board shall be open to the public. The board
may adopt a seal, which shall be officially and judicially
noticed, to authenticate instruments executed by its authority,
but omission of the seal shall not affect the validity of any
instruction.
Sec. 30. Laws 1971, chapter 869, section 4, subdivision 2,
is amended to read:
Subd. 2. [CHAIRMAN CHAIR.] The board shall elect
a chairman chair from its membership. The term of the first
chairman of the board shall expire on January 1, 1973, and the
terms of successor chairmen chair shall expire on January 1 of
each succeeding year. The chairman chair shall preside at all
meetings of the board, if present, and shall perform all other
duties and functions usually incumbent upon such an officer, and
all administrative functions assigned to him by the board. The
board shall elect a vice chairman chair from its membership to
act for the chairman chair during his temporary absence or
disability.
Sec. 31. Laws 1971, chapter 869, section 4, subdivision 5,
as amended by Laws 1973, chapter 632, section 2, is amended to
read:
Subd. 5. [PUBLIC EMPLOYEES.] The executive director and
all persons employed by the executive director shall be public
employees, and shall have all the rights and duties conferred on
public employees under Minnesota Statutes, Sections 179.50 to
179.571. The board may elect to have such employees become
members of either the public employees retirement association or
the Minnesota state retirement system 179A.01 to 179A.25. The
compensation and conditions of employment of such employees
shall not be governed by any rule applicable to state employees
in the classified service nor to any of the provisions of
Minnesota Statutes, Chapter 15A, unless the board so provides.
Sec. 32. Laws 1971, chapter 869, section 5, subdivision 1,
is amended to read:
Subdivision 1. [BOARD PLAN AND PROGRAM.] The board shall
adopt as its first a comprehensive plan for the collection,
treatment, and disposal of sewage in the district for such
designated period as the board deems proper and reasonable the
comprehensive plan adopted by the joint powers board heretofore
established for the Alexandria Lake Area Sanitary District by
agreement among local government units pursuant to Minnesota
Statutes, Section 471.59. The board shall prepare and adopt
subsequent comprehensive plans for the collection, treatment and
disposal of sewage in the district for each such succeeding
designated period as the board deems proper and reasonable. The
first plan, as modified by the board, and any subsequent plan
shall take into account the preservation and best and most
economic use of water and other natural resources in the area;
the preservation, use and potential for use of lands adjoining
waters of the state to be used for the disposal of sewage; and
the impact such a disposal system will have on present and
future land use in the area affected thereby. Such plans shall
include the general location of needed interceptors and
treatment works, a description of the area that is to be served
by the various interceptors and treatment works, a long range
capital improvements program and such other details as the board
shall deem appropriate. In developing the plans, the board
shall consult with persons designated for such purpose by
governing bodies of any municipal or public corporation or
governmental or political subdivision or agency within the
district to represent such entities and shall consider the data,
resources and input offered to the board by such entities and
any planning agency acting on behalf of one or more such
entities. Each such plan, when adopted, shall be followed in
the district and may be revised as often as the board deems
necessary.
Sec. 33. Laws 1971, chapter 869, section 5, subdivision 3,
is amended to read:
Subd. 3. [MUNICIPAL PLANS AND PROGRAMS; COORDINATION WITH
BOARD'S RESPONSIBILITIES.] As soon as practicable after the
adoption by the board of the first comprehensive plan, and
Before undertaking the construction of new sewers or other
disposal facilities or the substantial alteration or improvement
of any existing sewers or other disposal facilities, each local
government unit may, and shall if the construction or alteration
of any sewage disposal facilities is contemplated by such
government unit, adopt a similar comprehensive plan and program
for the collection, treatment and disposal of sewage for which
the local government unit is responsible, coordinated with the
board's comprehensive plan, and may revise the same as often as
it deems necessary. Each such local plan or revision thereof
shall be submitted forthwith to the board for review and shall
be subject to the approval of the board as to those features of
the plan affecting the board's responsibilities as determined by
the board. Any such features disapproved by the board shall be
modified in accordance with the board's recommendations. Once
the board's plan is adopted, No such construction project
involving such features shall be undertaken by the local
government unit unless its governing body shall first find the
project to be in accordance with the government unit's
comprehensive plan and program as approved by the board. Prior
to approval by the board of the comprehensive plan and program
of any local government unit in the district, no such
construction project shall be undertaken by such government unit
unless approval of the project is first secured from the board
as to those features of the project affecting the board's
responsibilities as determined by the board.
Sec. 34. Laws 1971, chapter 869, section 8, is amended to
read:
Sec. 8. [BUDGET.]
The board shall prepare and adopt, on or before October 1,
1971 and on or before October 1, 1972, and of each year
thereafter, a budget showing for the following calendar year or
other fiscal year determined by the board, sometimes referred to
in this act as the budget year, estimated receipts of money from
all sources, including but not limited to payments by each local
government unit, federal or state grants, taxes on property, and
funds on hand at the beginning of the year, and estimated
expenditures for:
(1) deferred payments under section 9, subdivisions 3 and
4;
(2) costs of operation, administration and maintenance of
the district disposal system;
(3) (2) cost of acquisition and betterment of the district
disposal system; and
(4) (3) debt service, including principal and interest, on
general obligation bonds and certificates issued pursuant to
section 13, obligations and debts assumed under section 6,
subdivisions 2 and 3, and any money judgments entered by a court
of competent jurisdiction. Expenditures within these general
categories, and such others as the board may from time to time
determine, shall be itemized in such detail as the board shall
prescribe. The board and its officers, agents and employees
shall not spend money for any purpose other than debt service
without having set forth such expense in the budget nor in
excess of the amount set forth in the budget therefor, and no
obligation to make such an expenditure shall be enforceable
except as the obligation of the person or persons incurring it;
provided that the board may amend the budget at any time by
transferring from one purpose to another any sums except money
for debt service and bond proceeds or by increasing expenditures
in any amount by which cash receipts during the budget year
actually exceed the total amounts designated in the original
budget. The creation of any obligation pursuant to section 13
or the receipt of any federal or state grant is a sufficient
budget designation of the proceeds for the purpose for which it
is authorized, and of the tax or other revenue pledged to pay
the obligation and interest on it, whether or not specifically
included in any annual budget.
Sec. 35. Laws 1971, chapter 869, section 10, subdivision
3b, as added by Laws 1975, chapter 287, section 6, is amended to
read:
Subd. 3b. Any ad valorem taxes levied under Laws 1971,
Chapter 869, Section 10, Subdivision 3 or Section 5 of this act
by the governing body of a government unit to pay any sums
charged to it by the board under Laws 1971, Chapter 869 or this
act shall be considered special levies within the meaning of
Minnesota Statutes, Section 275.50, Subdivision 5 , as amended
are not subject to, or counted towards, any limit imposed by law
on the levy of the taxes upon taxable property within any
governmental unit.
Sec. 36. Laws 1971, chapter 869, section 12, subdivision
1, as amended by Law 1973, chapter 632, section 3, is amended to
read:
Subdivision 1. [CONTRIBUTIONS OR ADVANCES FROM LOCAL
GOVERNMENT UNITS.] The board may, at such time as it deems
necessary and proper, request from all or some of the local
government units necessary moneys to defray the costs of any
obligations assumed under section 6 and the costs of
administration, operation and maintenance, including but not
limited to expenses and services described in subdivision 3.
Before making such request the board shall, by formal
resolution, determine the necessity for such moneys, setting
forth in such resolution the purposes for which such moneys are
needed and the estimated amount for each such purpose. Upon
receiving such request, the governing body of each such
government unit may provide for payment of the amount requested
or such part thereof as it deems fair and reasonable. Such
moneys may be paid out of general revenue funds or any other
available funds of any local government unit and the governing
bodies thereof may levy taxes to provide funds therefor, free
from any existing limitations imposed by law or charter. Such
moneys may be provided by such government units with or without
interest but if interest is charged it shall not exceed five
percent per annum. The board shall credit the local government
units for such payments in allocating current costs pursuant to
section 9, on such terms and at such times as it may agree with
the unit furnishing the same.
Sec. 37. Laws 1971, chapter 869, section 12, subdivision
2, as amended by Laws 1973, chapter 632, section 4, is amended
to read:
Subd. 2. [LIMITED TAX LEVY.] The board may levy ad valorem
taxes on all taxable property in the district to defray any of
the costs described in subdivisions subdivision 1 and 3,
provided that: (a) such costs have not been defrayed by
contribution under subdivision 1 and (b) such tax levy in any
year shall not exceed 5 mills a tax capacity rate of four
percent annually. Before certification of such levy to the
county auditor, the board shall determine the need for the money
to be derived from such levy by formal resolution setting forth
in said resolution the purposes for which the tax moneys will be
used and the amount proposed to be used for each such purpose.
In allocating current costs pursuant to section 9 the board
shall credit the government units for taxes collected pursuant
to levy made under this subdivision on such terms and at such
times as it deems just and reasonable.
Sec. 38. Laws 1971, chapter 869, section 17, subdivision
11, is amended to read:
Subd. 11. The board may sell, lease or otherwise dispose
of any real or personal property acquired by it which is no
longer required for accomplishment of its purposes. Such
property may be sold in the manner provided by Minnesota
Statutes, Section 458.196 469.065, insofar as practical. The
board may give such notice of sale as it shall deem appropriate.
When the board determines that any property or any part of the
district disposal system which has been acquired from a local
government unit without compensation is no longer required but
is required as a local facility by the government unit from
which it was acquired, the board may by resolution transfer it
to such government unit.
Sec. 39. Laws 1971, chapter 869, section 19, is amended to
read:
Sec. 19. [SERVICE CONTRACTS WITH GOVERNMENTAL ENTITIES
OUTSIDE THE JURISDICTION OF THE BOARD.]
The board may contract with the United States or any agency
thereof, any state or any agency thereof, or any municipal or
public corporation, governmental subdivision or agency or
political subdivision in any state, outside the jurisdiction of
the board, for furnishing to such entities any services which
the board may furnish to local government units in the district
under this act, including but not limited to planning for and
the acquisition, betterment, operation, administration and
maintenance of any or all interceptors, treatment works and
local sanitary sewer facilities, provided that the board may
further include as one of the terms of the contract that such
entity also pay to the board such amount as may be agreed upon
as a reasonable estimate of the proportionate share properly
allocable to the entity of costs of acquisition, betterment and
debt service previously allocated to local government units in
the district. When such payments are made by such entities to
the board, they shall be applied in reduction of the total
amount of costs thereafter allocated to each local government
unit in the district, on such equitable basis as the board deems
to be in the best interests of the district, applying so far as
practicable and appropriate the criteria set forth in section 9,
subdivision 2 2a. Any municipality in the state of Minnesota
may enter into such contract and perform all acts and things
required as a condition or consideration therefor consistent
with the purposes of this act, whether or not included among the
powers otherwise granted to such municipality by law or charter,
such powers to include those powers set out in section 10,
subdivisions 3, 3a, 3b, and 4.
Sec. 40. Laws 1971, chapter 869, section 20, subdivision
2, is amended to read:
Subd. 2. [CONTRACTS IN EXCESS OF $5,000 UNIFORM MUNICIPAL
CONTRACTING LAW.] No contract for any construction work, or for
the purchase of materials, supplies, or equipment, estimated to
cost more than $5,000 shall be made by the board without
publishing once in a newspaper having general circulation in the
district and once in a trade paper or legal newspaper published
in any city of the first class, not less than 14 days before the
last day for submission of bids, notice that bids or proposals
will be received. Such notice shall state the nature of the
work or purchase and the terms and conditions upon which the
contract is to be awarded, and the time and place where such
bids will be received, opened, and read publicly. After such
bids have been duly received, opened, read publicly, and
recorded, the board shall within a reasonable time award such
contract to the lowest responsible bidder or it may reject all
bids and readvertise. Each contract shall be duly executed in
writing and the party to whom the contract is awarded shall give
sufficient bond or security to the board for the faithful
performance of the contract as required by law. If the board by
an affirmative vote of not less than two thirds of its members
declares that an emergency exists requiring the immediate
purchase of materials or supplies or in making emergency
repairs, at a cost estimated to be in excess of $5,000, it shall
not be necessary to advertise for bids. All contracts for work
to be done or for purchases of materials, supplies, or equipment
shall be done in accordance with Minnesota Statutes, section
471.345.
Sec. 41. Laws 1971, chapter 869, section 21, is amended to
read:
Sec. 21. [ANNEXATION OF TERRITORY.]
Subdivision 1. [METHOD AND CONDITIONS FOR ANNEXATION.] Any
municipality in Douglas county, Minnesota upon resolution
adopted by a four-fifths vote of its governing body may petition
the board for annexation to the district of the area then
comprising the municipality, or any part thereof and, if
accepted by the board, such area shall be deemed annexed to the
district and subject to the jurisdiction of the board under the
terms and provisions of this act. The territory so annexed
shall be subject to taxation and assessment pursuant to the
provisions of this act and shall be subject to taxation by the
board like other property in the district for the payment of
principal and interest thereafter becoming due on general
obligations of the board, whether authorized or issued before or
after such annexation. The board may in its discretion
condition approval of the annexation upon: (a) the
contribution, by or on behalf of the municipality petitioning
for annexation, to the board of such amount as may be agreed
upon as being a reasonable estimate of the proportionate share,
properly allocable to the municipality, of costs of acquisition,
betterment and debt service previously allocated to local
government units in the district, on such terms as may be agreed
upon.; and in lieu of (a) or in addition thereto (b) such other
and further conditions as the board deems in the best interests
of the district. Notwithstanding any other provisions of this
act to the contrary, the conditions established for annexation
may include the requirement that the annexed municipality pay
for, contract for and oversee the construction of local sanitary
sewer facilities and interceptor sewers as those terms are
defined in section 2. For the purpose of paying this such
contribution or of satisfying any other condition established by
the board, the municipality petitioning annexation may exercise
the powers conferred in section 10. When such contributions are
made by the municipality to the board, they shall be applied in
reduction of the total amount of costs thereafter allocated to
each local government unit in the district, on such equitable
basis as the board deems to be in the best interests of the
district, applying so far as practicable and appropriate the
criteria set forth in section 9, subdivision 2. Upon annexation
of such territory, the secretary of the board shall certify to
the auditor and treasurer of the county in which the
municipality is located the fact of such annexation and a legal
description of the territory annexed.
Subd. 2. [LAKE MARY AND IDA TOWNSHIPS.] If Lake Mary or
Ida townships, or both of them, petition to annex all or any
part or parts of their townships to the district, upon
acceptance by the board, the townships shall have all powers set
out in section 18, subdivision 6.
Sec. 42. Laws 1971, chapter 869, section 24, is amended to
read:
Sec. 24. [AFFECTED LOCAL GOVERNMENT UNITS.]
The city of Alexandria and the townships of Alexandria,
Carlos, Hudson and, LaGrand, Lake Mary, and Ida, in the county
of Douglas, are affected by this act. Local consent shall not
be required.
Sec. 43. Laws 1985, chapter 302, section 2, subdivision 1,
as amended by Laws 1993, chapter 375, article 5, section 36,
subdivision 1, and Laws 1995, chapter 264, article 3, section
28, subdivision 1, is amended to read:
Subdivision 1. [ORDINANCE.] The governing body of the city
may adopt ordinances:
(a) establishing a special service district in the part of
Minneapolis which is south of 28th Street, west of Dupont Avenue
South, north of 31st Street, and east of East Calhoun Parkway
and East Lake of the Isles Parkway;
(b) establishing a special service district south of Sixth
Street southeast, west of Sixteenth Avenue Southeast, north of a
line parallel to and 200 feet south of University Avenue and
east of Twelfth Avenue Southeast;
(c) establishing a special service district that includes
that part of Minneapolis lying within the following described
line: commencing at the intersection of Grant Street with
LaSalle Avenue, South on LaSalle Avenue to Franklin Avenue south
on Blaisdell Avenue to 29th Street, east on 29th Street to 1st
Avenue South, north on 1st Avenue South to a point on a line
parallel to and 200 feet south of 26th Street, east on that line
to 3rd Avenue South, north on 3rd Avenue South to a point on a
line parallel to and 200 feet north of 26th Street, west on that
line to 1st Avenue South, north on 1st Avenue South to Grant
Street, west on Grant Street to the point of origin;
(d) establishing a special service district south of Saint
Anthony Parkway, west of a line parallel to and 300 feet east of
Central Avenue, north of Broadway Street, and east of a line
parallel to and 300 feet west of Central Avenue; and
(e) establishing a special service district that includes
that portion of Minneapolis lying within the following described
line: commencing at the intersection of the Mississippi River
and Interstate Highway 94, northwesterly along the Mississippi
River to its intersection with Interstate Highway 35W,
southwesterly on Interstate Highway 35W to its intersection with
Hiawatha Avenue extended (Trunk Highway 55), southeasterly on
Hiawatha Avenue to its intersection with Franklin Avenue,
easterly on Franklin Avenue to its intersection with 20th Avenue
South extended, northerly on 20th Avenue South to its
intersection with Interstate Highway 94, and easterly on
Interstate Highway 94 to the point of origin.; and
(f) establishing a special service district that includes
that portion of Minneapolis lying within the following described
line: commencing at the intersection of France Avenue South and
Glendale Terrace; south on France Avenue South to 52nd Street
West; east on 52nd Street West to Ewing Avenue South, north on
Ewing Avenue South to 51st Street West; east on 51st Street West
to Upton Avenue South; north on Upton Avenue South to 44th
Street West; east on 44th Street West to Thomas Avenue South;
north on a line which would be a continuation of Thomas Avenue
South to 42nd Street West; west on 42nd Street West to Vincent
Avenue South; south on Vincent Avenue South to 43rd Avenue West;
west on 43rd Street West to Chowen Avenue South; south on Chowen
Avenue South to Drew Avenue South; southwesterly on Drew Avenue
South to Glendale Terrace; and west on Glendale Terrace to the
point of origin.
Only property which is zoned for commercial, business, or
industrial use under a municipal zoning ordinance may be
included in a special service district. The ordinance shall
describe with particularity the areas to be included in the
district and the special services to be furnished. The
ordinance may not be adopted until after a public hearing on the
question. Notice of the hearing shall include:
(1) the time and place of the hearing;
(2) a map showing the boundaries of the proposed district;
and
(3) a statement that all persons owning property in the
proposed district will be given an opportunity to be heard at
the hearing.
Sec. 44. [CITY OF MINNEAPOLIS; SPECIAL SERVICE DISTRICT
OPTION.]
For special service districts established in the city of
Minneapolis after enactment of this act and before July 1, 2001,
the city of Minneapolis may at its option (1) establish the
district under the provisions of Minnesota Statutes, sections
428A.01 to 428A.10, or (2) establish by ordinance the district
under the provisions of Laws 1985, chapter 302, sections 1 to 7,
as amended. The enactment of enabling legislation under Laws
1985, chapter 302, as amended, is not required for a district
established under this section.
Sec. 45. [VALLEY BRANCH WATERSHED DISTRICT.]
Subdivision 1. [LEVY AUTHORIZED.] Notwithstanding
Minnesota Statutes, section 103D.905, subdivision 3, the Valley
Branch watershed district may levy up to $200,000 annually for
its administrative fund.
Subd. 2. [EFFECTIVE DATE.] This section is effective,
without local approval, beginning with taxes levied in 1996,
payable in 1997.
Sec. 46. [VIRGINIA AREA AMBULANCE DISTRICT.]
Subdivision 1. [AGREEMENT; POWERS; GENERAL
DESCRIPTION.] (a) The cities of Virginia, Mountain Iron, and
Gilbert, and all or part of the towns of Pike, Clinton,
McDavitt, Colvin, Sandy, Cherry, Ellsburg, Wouri, Lavell, and
Embarrass, may by resolution of their city councils and town
boards establish the Virginia area ambulance district.
(b) The St. Louis county board may by resolution provide
that property located in unorganized townships described in
clauses (1) to (5), or any part of them, may be included within
the district:
(1) Township 61 North, Range 17 West;
(2) Township 59 North, Ranges 16 and 18 West;
(3) Township 56 North, Range 16 West;
(4) Township 60 North, Range 18 West; and
(5) Township 55 North, Range 15.
(c) The district shall make payments of the proceeds of the
tax authorized in this section to the city of Virginia, which
shall provide ambulance services throughout the district and may
exercise all the powers of the cities and towns that relate to
ambulance service anywhere within its territory.
(d) Any other contiguous town or home rule charter or
statutory city may join the district with the agreement of the
cities and towns that comprise the district at the time of its
application to join. Action to join the district may be taken
by the city council or town board of the city or town.
Subd. 2. [BOARD.] The district shall be governed by a
board composed of one member appointed by the city council or
town board of each city and town in the district. A district
board member may, but is not required to, be a member of a city
council or town board. Except as provided in this section,
members shall serve two-year terms ending the first Monday in
January and until their successors are appointed and qualified.
Of the members first appointed, as far as possible, the terms of
one-half shall expire on the first Monday in January in the
first year following appointment and one-half the first Monday
in January in the second year. The terms of those initially
appointed must be determined by lot. If an additional member is
added because an additional city or town joins the district, the
member's term must be fixed so that, as far as possible, the
terms of one-half of all the members expire on the same date.
Subd. 3. [TAX.] The district may impose a property tax on
real and personal property in the district in an amount
sufficient to discharge its operating expenses and debt payable
in each year, but not to exceed .0528 percent of the district's
taxable market value. The St. Louis county auditor shall
collect the tax and distribute it to the Virginia area ambulance
district.
Subd. 4. [PUBLIC INDEBTEDNESS.] The district may incur
debt in the manner provided for a municipality by Minnesota
Statutes, chapter 475, when necessary to accomplish a duty
charged to it.
Subd. 5. [WITHDRAWAL.] Upon two years' notice, a city or
town may withdraw from the district. Its territory shall remain
subject to taxation for debt incurred prior to its withdrawal
pursuant to Minnesota Statutes, chapter 475.
Subd. 6. [EFFECTIVE DATE.] This section is effective in
the cities of Virginia, Mountain Iron, and Gilbert, and the
towns of Pike, Clinton, McDavitt, Colvin, Sandy, Cherry,
Ellsburg, Wouri, Lavell, and Embarrass the day after compliance
with Minnesota Statutes, section 645.021, subdivision 3, by the
governing body of each. This section is effective for
unorganized townships described in subdivision 1, paragraph (b),
clauses (1) to (6), the day after compliance with Minnesota
Statutes, section 645.021, subdivision 3, by the St. Louis
county board.
Sec. 47. [REPEALER.]
Laws 1971, chapter 869, section 6, subdivision 3, is
repealed.
Sec. 48. [EFFECTIVE DATE.]
Pursuant to Minnesota Statutes, section 645.023,
subdivision 1, sections 19 to 22 are effective without local
approval on the day following final enactment and section 19
applies to taxes levied in 1996, payable in 1997, and thereafter.
Sections 23 to 42 and 47 are effective without local
approval on the day after their final enactment.
ARTICLE 9
OBSOLETE PROVISIONS
Section 1. Minnesota Statutes 1994, section 290.0922,
subdivision 3, is amended to read:
Subd. 3. [DEFINITION DEFINITIONS.] (a) "Minnesota sales or
receipts," means the total sales apportioned to Minnesota
pursuant to section 290.191, subdivision 5, the total receipts
attributed to Minnesota pursuant to section 290.191,
subdivisions 6 to 8, and/or the total sales or receipts
apportioned or attributed to Minnesota pursuant to any other
apportionment formula applicable to the taxpayer.
(b) "Minnesota property," and means total Minnesota
tangible property as provided in section 290.191, subdivisions 9
to 11, and any other tangible property located in Minnesota.
Intangible property shall not be included in Minnesota property
for purposes of this section. Taxpayers who do not utilize
tangible property to apportion income shall nevertheless include
Minnesota property for purposes of this section. On a return
for a short taxable year, the amount of Minnesota property
owned, as determined under section 290.191, shall be included in
Minnesota property based on a fraction in which the numerator is
the number of days in the short taxable year and the denominator
is 365.
(c) "Minnesota payrolls" have the meanings given in section
290.092, subdivision 4 means total Minnesota payrolls as
provided in section 290.191, subdivision 12. Taxpayers who do
not utilize payrolls to apportion income shall nevertheless
include Minnesota payrolls for purposes of this section.
Sec. 2. Minnesota Statutes 1994, section 290.095,
subdivision 3, is amended to read:
Subd. 3. [CARRYOVER.] (a) A net operating loss incurred in
a taxable year: (i) beginning after December 31, 1986, shall be
a net operating loss carryover to each of the 15 taxable years
following the taxable year of such loss; (ii) beginning before
January 1, 1987, shall be a net operating loss carryover to each
of the five taxable years following the taxable year of such
loss subject to the provisions of Minnesota Statutes 1986,
section 290.095; and (iii) beginning before January 1, 1987,
shall be a net operating loss carryback to each of the three
taxable years preceding the loss year subject to the provisions
of Minnesota Statutes 1986, section 290.095.
(b) The entire amount of the net operating loss for any
taxable year shall be carried to the earliest of the taxable
years to which such loss may be carried. The portion of such
loss which shall be carried to each of the other taxable years
shall be the excess, if any, of the amount of such loss over the
sum of the taxable net income, adjusted by the modifications
specified in subdivision 4, for each of the taxable years to
which such loss may be carried.
(c) Where a corporation does business both within and
without Minnesota, and apportions its income under the
provisions of section 290.191, the net operating loss deduction
incurred in any taxable year shall be allowed to the extent of
the apportionment ratio of the loss year.
(d) No additional net operating loss deduction is allowed
in a subsequent taxable year for the portion of a net operating
loss deduction incurred in any taxable year used to offset
Minnesota income in a year in which the taxpayer is subject to
the alternative minimum tax in section 290.092.
(e) The provisions of sections 381, 382, and 384 of the
Internal Revenue Code apply to carryovers in certain corporate
acquisitions and special limitations on net operating loss
carryovers.
Sec. 3. Minnesota Statutes 1994, section 297A.15,
subdivision 5, is amended to read:
Subd. 5. [REFUND; APPROPRIATION.] Notwithstanding the
provisions of sections 297A.02, subdivision 5, and 297A.25,
subdivisions subdivision 42 and 50, the tax on sales of capital
equipment, and replacement capital equipment, and construction
materials and supplies under section 297A.25, subdivision 50,
shall be imposed and collected as if the rates rate under
sections section 297A.02, subdivision 1, and 297A.021, applied.
Upon application by the purchaser, on forms prescribed by the
commissioner, a refund equal to the reduction in the tax due as
a result of the application of the exemption under section
297A.25, subdivision 42 or 50, and the rates rate under sections
section 297A.02, subdivision 5, and 297A.021 shall be paid to
the purchaser. In the case of building materials qualifying
under section 297A.25, subdivision 50, where the tax was paid by
a contractor, application must be made by the owner for the
sales tax paid by all the contractors, subcontractors, and
builders for the project. The application must include
sufficient information to permit the commissioner to verify the
sales tax paid for the project. The application shall include
information necessary for the commissioner initially to verify
that the purchases qualified as capital equipment under section
297A.25, subdivision 42, or replacement capital equipment under
section 297A.01, subdivision 20, or capital equipment or
construction materials and supplies under section 297A.25,
subdivision 50. No more than two applications for refunds may
be filed under this subdivision in a calendar year. No owner
may apply for a refund based on the exemption under section
297A.25, subdivision 50, before July 1, 1993. Unless otherwise
specifically provided by this subdivision, the provisions of
section 289A.40 apply to the refunds payable under this
subdivision. There is annually appropriated to the commissioner
of revenue the amount required to make the refunds.
The amount to be refunded shall bear interest at the rate
in section 270.76 from the date the refund claim is filed with
the commissioner.
Sec. 4. Minnesota Statutes 1994, section 297A.15,
subdivision 6, is amended to read:
Subd. 6. [REFUND; APPROPRIATION.] The tax on the gross
receipts from the sale of items exempt under section 297A.25,
subdivision 43, must be imposed and collected as if the sale
were taxable and the rates rate under sections section 297A.02,
subdivision 1, and 297A.021 applied.
Upon application by the owner of the homestead property on
forms prescribed by the commissioner, a refund equal to the tax
paid on the gross receipts of the building materials and
equipment must be paid to the homeowner. In the case of
building materials in which the tax was paid by a contractor,
application must be made by the homeowner for the sales tax paid
by the contractor. The application must include sufficient
information to permit the commissioner to verify the sales tax
paid for the project. The contractor must furnish to the
homeowner a statement of the cost of building materials and the
sales taxes paid on the materials. The amount required to make
the refunds is annually appropriated to the commissioner.
Interest must be paid on the refund at the rate in section
270.76 from 60 days after the date the refund claim is filed
with the commissioner.
Sec. 5. Minnesota Statutes 1994, section 297A.21,
subdivision 4, is amended to read:
Subd. 4. [REQUIRED REGISTRATION BY OUT-OF-STATE RETAILER
NOT MAINTAINING PLACE OF BUSINESS IN MINNESOTA.] (a) A retailer
making retail sales from outside this state to a destination
within this state and not maintaining a place of business in
this state shall file an application for a permit pursuant to
section 297A.04 and shall collect and remit the use tax as
provided in section 297A.16 if the retailer engages in the
regular or systematic soliciting of sales from potential
customers in this state by:
(1) the distribution, by mail or otherwise, without regard
to the state from which such distribution originated or in which
the materials were prepared, of catalogs, periodicals,
advertising flyers, or other written solicitations of business
to customers in this state;
(2) display of advertisements on billboards or other
outdoor advertising in this state;
(3) advertisements in newspapers published in this state;
(4) advertisements in trade journals or other periodicals
the circulation of which is primarily within this state;
(5) advertisements in a Minnesota edition of a national or
regional publication or a limited regional edition in which this
state is included of a broader regional or national publication
which are not placed in other geographically defined editions of
the same issue of the same publication;
(6) advertisements in regional or national publications in
an edition which is not by its contents geographically targeted
to Minnesota but which is sold over the counter in Minnesota or
by subscription to Minnesota residents;
(7) advertisements broadcast on a radio or television
station located in Minnesota; or
(8) any other solicitation by telegraphy, telephone,
computer database, cable, optic, microwave, or other
communication system.
(b) The location within or without this state of vendors
independent of the retailer which provide products or services
to the retailer in connection with its solicitation of customers
within this state, including such products and services as
creation of copy, printing, distribution, and recording, is not
to be taken into account in the determination of whether the
retailer is required to collect use tax. Paragraph (a) shall be
construed without regard to the state from which distribution of
the materials originated or in which they were prepared.
(c) A retailer not maintaining a place of business in this
state shall be presumed, subject to rebuttal, to be engaged in
regular solicitation within this state if it engages in any of
the activities in paragraph (a) and (1) makes 100 or more retail
sales from outside this state to destinations within this state
during a period of 12 consecutive months, or (2) makes ten or
more retail sales totaling more than $100,000 from outside this
state to destinations within this state during a period of 12
consecutive months.
(d) A retailer not maintaining a place of business in this
state shall not be required to collect use tax imposed by any
local governmental unit or subdivision of this state and this
section does not subject such a retailer to any regulation of
any local unit of government or subdivision of this state. This
paragraph does not apply to the tax imposed under section
297A.021.
Sec. 6. Minnesota Statutes 1994, section 297A.211,
subdivision 3, is amended to read:
Subd. 3. A person who pays the tax to the seller under
section 297A.03 or pays the tax to the motor vehicle registrar
as required by section 297B.02 and who meets the requirements of
this section at the time of the sale, except that the person has
not registered as a retailer under this section at the time of
the sale, may register as a retailer, make a return, and file
for a refund of the difference between the tax calculated under
section 297A.02, 297A.021, 297A.14, or 297B.02 and the tax
calculated under subdivision 2.
Sec. 7. Minnesota Statutes 1994, section 297A.24,
subdivision 1, is amended to read:
Subdivision 1. [STATE TAX.] If any article of tangible
personal property or any item enumerated in section 297A.14 has
already been subjected to a tax by any other state in respect of
its sale, storage, use or other consumption in an amount less
than the tax imposed by sections 297A.01 to 297A.44, then as to
the person who paid the tax in such other state, the provisions
of section 297A.14 shall apply only at a rate measured by the
difference between the sum of the rates rate imposed under
sections section 297A.02 and 297A.021 and the rate by which the
previous tax was computed. If such tax imposed in such other
state was equal to or greater than the tax imposed in this
state, then no tax shall be due from such person under section
297A.14.
Sec. 8. Minnesota Statutes 1994, section 297A.2572, is
amended to read:
297A.2572 [AGRICULTURE PROCESSING FACILITY MATERIALS;
EXEMPTION.]
Purchases of construction materials and supplies are exempt
from the sales and use taxes imposed under this chapter,
regardless of whether purchased by the owner or a contractor,
subcontractor, or builder, if the materials and supplies are
used or consumed in constructing an agriculture processing
facility as defined in section 469.1811 in which the total
capital investment in the processing facility is expected to
exceed $100,000,000. The tax shall be imposed and collected as
if the rates rate under sections section 297A.02, subdivision 1,
and 297A.021, applied, and then refunded in the manner provided
in section 297A.15, subdivision 5.
Sec. 9. Minnesota Statutes 1994, section 297A.2573, is
amended to read:
297A.2573 [MINERAL PRODUCTION FACILITIES; EXEMPTION.]
Materials, equipment, and supplies used or consumed in
constructing, or incorporated into the construction of exempted
facilities as defined in this section are exempt from the taxes
imposed under this chapter and from any sales and use tax
imposed by a local unit of government, notwithstanding any
ordinance or city charter provision.
As used in this section, "exempted facilities" means:
(1) a value added iron products plant, which may be either
a new plant or a facility incorporated into an existing plant
that produces iron upgraded to a minimum of 75 percent iron
content or any iron alloy with a total minimum metallic content
of 90 percent;
(2) a facility used for the manufacture of fluxed taconite
pellets as defined in section 298.24;
(3) a new capital project that has a total cost of over
$40,000,000 that is directly related to production, cost, or
quality at an existing taconite facility that does not qualify
under clause (1) or (2); and
(4) a new mine or minerals processing plant for any mineral
subject to the net proceeds tax imposed under section 298.015.
The tax shall be imposed and collected as if the rates rate
under sections section 297A.02, subdivision 1, and 297A.021,
applied, and then refunded in the manner provided in section
297A.15, subdivision 5.
Sec. 10. Minnesota Statutes 1994, section 297A.44,
subdivision 1, is amended to read:
Subdivision 1. (a) Except as provided in paragraphs (b),
(c), and (d), all revenues, including interest and penalties,
derived from the excise and use taxes imposed by sections
297A.01 to 297A.44 shall be deposited by the commissioner in the
state treasury and credited to the general fund.
(b) All excise and use taxes derived from sales and use of
property and services purchased for the construction and
operation of an agricultural resource project, from and after
the date on which a conditional commitment for a loan guaranty
for the project is made pursuant to section 41A.04, subdivision
3, shall be deposited in the Minnesota agricultural and economic
account in the special revenue fund. The commissioner of
finance shall certify to the commissioner the date on which the
project received the conditional commitment. The amount
deposited in the loan guaranty account shall be reduced by any
refunds and by the costs incurred by the department of revenue
to administer and enforce the assessment and collection of the
taxes.
(c) All revenues, including interest and penalties, derived
from the excise and use taxes imposed on sales and purchases
included in section 297A.01, subdivision 3, paragraphs (d) and
(l), clauses (1) and (2), must be deposited by the commissioner
in the state treasury, and credited as follows:
(1) first to the general obligation special tax bond debt
service account in each fiscal year the amount required by
section 16A.661, subdivision 3, paragraph (b); and
(2) after the requirements of clause (1) have been met, the
balance must be credited to the general fund.
(d) The revenues, including interest and penalties, derived
from the taxes imposed on solid waste collection services as
described in section 297A.45, except for the tax imposed under
section 297A.021, shall be deposited by the commissioner in the
state treasury and credited to the general fund to be used for
funding solid waste reduction and recycling programs.
Sec. 11. Minnesota Statutes 1995 Supplement, section
297A.45, subdivision 2, is amended to read:
Subd. 2. [APPLICATION.] The taxes tax imposed by
sections section 297A.02 and 297A.021 apply applies to all
public and private mixed municipal solid waste management
services.
Notwithstanding section 297A.25, subdivision 11, a
political subdivision that purchases waste management services
on behalf of its citizens shall pay the taxes.
If a political subdivision provides a waste management
service to its residents at a cost in excess of the total direct
charge to the residents for the service, the political
subdivision shall pay the taxes based on its cost of providing
the service in excess of the direct charges.
A person who transports mixed municipal solid waste
generated by that person or by another person without
compensation shall pay the taxes at the waste facility based on
the disposal charge or tipping fee.
Sec. 12. Minnesota Statutes 1995 Supplement, section
297A.45, subdivision 3, is amended to read:
Subd. 3. [EXEMPTIONS.] (a) The cost of a service or the
portion of a service to collect and manage recyclable materials
separated from mixed municipal solid waste by the waste
generator is exempt from the taxes tax imposed in sections
section 297A.02 and 297A.021.
(b) The amount of a surcharge or fee imposed under section
115A.919, 115A.921, 115A.923, or 473.843 is exempt from the
taxes tax imposed in sections section 297A.02 and 297A.021.
(c) Waste from a recycling facility that separates or
processes recyclable materials and that reduces the volume of
the waste by at least 85 percent is exempt from the taxes tax
imposed in sections section 297A.02 and 297A.021. To qualify
for the exemption under this paragraph, the waste exempted must
be managed separately from other solid waste.
(d) The following costs are exempt from the taxes tax
imposed in sections section 297A.02 and 297A.021:
(1) costs of providing educational materials and other
information to residents;
(2) costs of managing solid waste other than mixed
municipal solid waste, including household hazardous waste; and
(3) costs of court litigation and associated damages.
(e) The cost of a waste management service is exempt from
the taxes tax imposed in sections section 297A.02 and 297A.021
to the extent that the cost was previously subject to the tax.
Sec. 13. Minnesota Statutes 1995 Supplement, section
297A.45, subdivision 4, is amended to read:
Subd. 4. [CITY SALES TAX MAY NOT BE IMPOSED.]
Notwithstanding any other law or charter provision to the
contrary, a home rule charter or statutory city that imposes a
general sales tax may not impose the sales tax on solid waste
management services that are subject to the tax under this
section. This subdivision does not apply to a tax imposed under
section 297A.021.
Sec. 14. Minnesota Statutes 1994, section 297A.46, is
amended to read:
297A.46 [LOCAL GOVERNMENTS EXEMPT FROM LOCAL SALES TAXES.]
Notwithstanding any other law, ordinance, or charter
provision, no political subdivision of the state shall be
required to pay any general sales tax imposed by a political
subdivision of the state. This provision does not apply to the
local option tax under section 297A.021.
Sec. 15. Minnesota Statutes 1994, section 298.01,
subdivision 4e, is amended to read:
Subd. 4e. [ALTERNATIVE MINIMUM TAX CREDIT.] (a) A credit
is allowed against the tax imposed by subdivision 4 for the
increases in occupation taxes paid in 1988, 1989, and 1990
attributable to the alternative minimum tax imposed under
section 290.092 and Minnesota Statutes 1986, section 298.40.
The amount of the credit allowed under this paragraph is
determined under section 290.06, subdivision 21.
(b) A credit is allowed against qualified regular tax for
qualified alternative minimum tax previously paid. The amount
of the credit allowed under this paragraph is determined under
section 290.0921, subdivision 8. For purposes of calculating
this credit, the following terms have the meanings given:
(1) "Qualified alternative minimum tax" means the amount
determined under subdivision 4d and section 290.0921,
subdivision 1.
(2) "Qualified regular tax" means the tax imposed under
subdivision 4 and section 290.06, subdivision 1.
Sec. 16. [REPEALER.]
Subdivision 1. [GROSS EARNINGS TAXES ON TRUST
COMPANIES.] Minnesota Statutes 1994, sections 295.37; 295.39;
295.40; 295.41; 295.42; and 295.43, are repealed.
Subd. 2. [LOCAL OPTION SALES TAX REFERENCES.] Minnesota
Statutes 1994, sections 297A.14, subdivision 3; and 297A.24,
subdivision 2, are repealed.
Subd. 3. [CORPORATE ALTERNATIVE MINIMUM TAX; BEFORE 1990.]
Minnesota Statutes 1994, sections 290.06, subdivision 21; and
290.092, are repealed.
Sec. 17. [EFFECTIVE DATE.]
The amendments in section 3 striking references to
Minnesota Statutes, section 297A.021, and sections 4 to 14 and
16, subdivision 2, are effective July 1, 1996.
ARTICLE 10
BUDGET RESERVE
Section 1. Minnesota Statutes 1995 Supplement, section
16A.152, subdivision 2, is amended to read:
Subd. 2. [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 reserve until the total amount in the account is
$220,000,000 $270,000,000. An amount equal to any additional
biennial unrestricted budgetary general fund balances balance
made available after November 1 of every as the result of a
forecast in an odd-numbered calendar year are after November 1
is appropriated in January of the following year to reduce the
property tax levy recognition percent under section 121.904,
subdivision 4a, to zero before additional money
beyond $220,000,000 $270,000,000 is allocated to the budget
reserve account. The amount appropriated is the full amount
forecast to be available at the end of the biennium and is not
limited to the amount forecast to be available at the end of the
current fiscal year.
The amounts necessary to meet the requirements of this
section are appropriated from the general fund.
Sec. 2. Minnesota Statutes 1995 Supplement, section
121.904, subdivision 4a, is amended to read:
Subd. 4a. [LEVY RECOGNITION.] (a) "School district tax
settlement revenue" means the current, delinquent, and
manufactured home property tax receipts collected by the county
and distributed to the school district, including distributions
made pursuant to section 279.37, subdivision 7, and excluding
the amount levied pursuant to section 124.914, subdivision 1.
(b) In June of each year, the school district shall
recognize as revenue, in the fund for which the levy was made,
the lesser of:
(1) the May, June, and July school district tax settlement
revenue received in that calendar year; or
(2) the sum of the state aids and credits enumerated in
section 124.155, subdivision 2, which are for the fiscal year
payable in that fiscal year plus an amount equal to the levy
recognized as revenue in June of the prior year plus 48 31
percent for fiscal year 1996 and thereafter of the amount of the
levy certified in the prior calendar year according to section
124A.03, subdivision 2, plus or minus auditor's adjustments, not
including levy portions that are assumed by the state; or
(3) 48 18.1 percent for fiscal year 1996, the percent
determined under section 3 for fiscal year 1997 and that same
percent thereafter of the amount of the levy certified in the
prior calendar year, plus or minus auditor's adjustments, not
including levy portions that are assumed by the state, which
remains after subtracting, by fund, the amounts levied for the
following purposes:
(i) reducing or eliminating projected deficits in the
reserved fund balance accounts for unemployment insurance and
bus purchases;
(ii) statutory operating debt pursuant to section 124.914,
subdivision 1;
(iii) retirement and severance pay pursuant to sections
122.531, subdivision 9, 124.2725, subdivision 15, 124.4945,
124.912, subdivision 1, and 124.916, subdivision 3, and Laws
1975, chapter 261, section 4;
(iv) amounts levied for bonds issued and interest thereon,
amounts levied for debt service loans and capital loans, amounts
levied for down payments under section 124.82, subdivision 3,
and amounts levied pursuant to section 136C.411; and
(v) amounts levied under section 124.755.
Notwithstanding the foregoing, the levy recognition
percentage for the referendum levy certified according to
section 124A.03, subdivision 2, is 31 percent.
(c) In July of each year, the school district shall
recognize as revenue that portion of the school district tax
settlement revenue received in that calendar year and not
recognized as revenue for the previous fiscal year pursuant to
clause (b).
(d) All other school district tax settlement revenue shall
be recognized as revenue in the fiscal year of the settlement.
Portions of the school district levy assumed by the state,
including prior year adjustments and the amount to fund the
school portion of the reimbursement made pursuant to section
273.425, shall be recognized as revenue in the fiscal year
beginning in the calendar year for which the levy is payable.
Sec. 3. [1997 PROPERTY TAX RECOGNITION SHIFT ADJUSTMENT.]
Subdivision 1. [ADJUSTMENT.] The commissioner of finance
shall adjust the property tax recognition shift percentage for
fiscal year 1997 under Minnesota Statutes, section 121.904,
subdivision 4a, paragraph (b), clause (3), according to this
section.
Subd. 2. [APPROPRIATION.] $180,000,000 is appropriated
from the general fund to the commissioner of children, families,
and learning for fiscal year 1997 to reduce the property tax
levy recognition percentage under Minnesota Statutes, section
121.904, subdivision 4a, paragraph (b), clause (3). This
appropriation replaces the appropriation for fiscal year 1997
made under Minnesota Statutes, section 16A.152, subdivision 2,
as a result of the November 1995 forecast.
Subd. 3. [NOVEMBER 1996 DEFICIT CONTINGENCY.]
Notwithstanding Minnesota Statutes, section 16A.152, subdivision
4, if the commissioner of finance determines on the basis of a
forecast of general fund revenues and expenditures issued before
January 1, 1997, that the unrestricted budgetary general fund
balance at the close of the 1996-1997 biennium will show a
deficit, the commissioner of finance shall first act to reduce
the deficit by increasing the property tax recognition
percentage under Minnesota Statutes, section 121.904,
subdivision 4a, paragraph (b), clause (3), but not above 18.1
percent. The appropriation in subdivision 2 is reduced
accordingly. The commissioner of finance shall make up any
additional deficit by reducing the amount in the budget reserve
in accordance with Minnesota Statutes, section 16A.152,
subdivision 4.
Subd. 4. [NOVEMBER 1996 SURPLUS CONTINGENCY.]
Notwithstanding Minnesota Statutes, section 16A.152, subdivision
4, if the commissioner of finance determines on the basis of a
forecast of general fund revenues and expenditures issued before
January 1, 1997, that the unrestricted budgetary general fund
balance at the close of the 1996-1997 biennium will show a
surplus, the amount of the surplus is appropriated from the
general fund to an education aid reserve account, except that
the amount appropriated must not exceed the forecast value of
the cost of reducing the property tax levy recognition
percentage under Minnesota Statutes, section 121.904,
subdivision 4a, paragraph (b), clause (3), to zero in fiscal
year 1997. The balance in the account does not cancel but may
not be expended until appropriated by law for education aid for
fiscal years 1998 and 1999.
Subd. 5. [PERCENTAGE CERTIFICATION.] The commissioner of
finance shall determine the amount available to reduce the
property tax levy recognition percentage after giving effect to
subdivisions 2 and 3, and shall certify it to the commissioner
of children, families, and learning by January 5, 1997. The
commissioner of children, families, and learning shall calculate
the percentage using the method specified in section 121.904,
subdivision 4c, and shall notify school districts of the
resulting change in the levy recognition percentage by January
15, 1997.
Sec. 4. [BUDGET RESERVE 1996.]
The amount necessary to bring the budget reserve to
$270,000,000 on July 1, 1996, is appropriated from the general
fund to the commissioner of finance for transfer to the budget
reserve on that date.
Sec. 5. [REPEALER.]
1996 H.F. No. 2156, article 14, section 4, if enacted, is
repealed.
Sec. 6. [EFFECTIVE DATE.]
This article is effective the day following final enactment.
ARTICLE 11
TACONITE TAX RELIEF AREA FISCAL DISPARITIES
Section 1. Minnesota Statutes 1995 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 local tax rates.
(c) "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 aid payable in 1996 the class rate
applicable to all class 4a shall be 3.4 percent; and (ii)
estimated market values for the assessment two years prior to
that in which aid is payable. "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, or 276A.02, subdivision 3, multiplied by
the ratio determined pursuant to section 473F.08, subdivision 6,
or 276A.06, subdivision 7, for the municipality, as defined in
section 473F.02, subdivision 8, or 276A.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), (2), and (3), 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.
(d) "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, or 276A.02,
subdivision 3, multiplied by the ratio determined pursuant to
section 473F.08, subdivision 6, or 276A.06, subdivision 7, for
the municipality, as defined in section 473F.02, subdivision
8, or 276A.06, subdivision 7, 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.
(e) "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) "Equalized school levies" means the amounts levied for:
(1) general education under section 124A.23, subdivision 2;
(2) supplemental revenue under section 124A.22, subdivision
8a;
(3) capital expenditure facilities revenue under section
124.243, subdivision 3;
(4) capital expenditure equipment revenue under section
124.244, subdivision 2;
(5) basic transportation under section 124.226, subdivision
1; and
(6) referendum revenue under section 124A.03.
(g) "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 total previous net tax capacity of the
unique taxing jurisdiction.
(h) 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," "gross taxes," or "taxes
levied" means the total net tax capacity based 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" 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.
"Taxes levied" excludes equalized school levies.
(i) "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;
(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) "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 number of households
for the third most recent year. The household adjustment factor
cannot be less than one.
(k) "Growth adjustment factor" means the household
adjustment factor in the case of counties. In the case of
cities, towns, school districts, and special taxing districts,
the growth adjustment factor equals one. The growth adjustment
factor cannot be less than one.
(l) For aid payable in 1992 and subsequent years,
"homestead and agricultural credit base" means the previous
year's certified homestead and agricultural credit aid
determined under subdivision 2 less any permanent aid reduction
in the previous year to homestead and agricultural credit aid
under section 477A.0132, plus, for aid payable in 1992, fiscal
disparity homestead and agricultural credit aid under
subdivision 2b.
(m) "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.
(n) "Fiscal disparity adjustment" means the difference
between (1) a taxing jurisdiction's fiscal disparity
distribution levy under section 473F.08, subdivision 3, clause
(a), or 276A.06, 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.
Sec. 2. Minnesota Statutes 1995 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 after November 10 and on or before November 24 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 and,
for a town, the amount of its final levy. It must clearly state
that each taxing authority, including regional library districts
established under section 134.201, and including the
metropolitan taxing districts as defined in paragraph (i), but
excluding all other special taxing districts and towns, 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 current budget and 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.
(d) The notice must state for each parcel:
(1) the market value of the property as determined under
section 273.11, and used for computing property taxes payable in
the following year and for taxes payable in the current year;
and, in the case of residential property, whether the property
is classified as homestead or nonhomestead. The notice must
clearly inform taxpayers of the years to which the market values
apply and that the values are final values;
(2) by county, city or town, school district excess
referenda levy, remaining school district levy, regional library
district, if in existence, the total of the metropolitan special
taxing districts as defined in paragraph (i) and the sum of the
remaining special taxing districts, and as a total of the taxing
authorities, including all 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. For the purposes of this subdivision, "school
district excess referenda levy" means school district taxes for
operating purposes approved at referendums, including those
taxes based on net tax capacity as well as those based on market
value. "School district excess referenda levy" does not include
school district taxes for capital expenditures approved at
referendums or school district taxes to pay for the debt service
on bonds approved at referenda. In the case of the city of
Minneapolis, the levy for the Minneapolis library board and the
levy for Minneapolis park and recreation shall be listed
separately from the remaining amount of the city's levy. In the
case of a parcel where tax increment or the fiscal disparities
areawide tax under chapter 276A or 473F applies, the proposed
tax levy on the captured value or the proposed tax levy on the
tax capacity subject to the areawide tax must each be stated
separately and not included in the sum of the special taxing
districts; 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.
(e) 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;
(4) amounts necessary to pay tort judgments against the
taxing authority that become final after the date the proposed
taxes are certified; and
(5) the contamination tax imposed on properties which
received market value reductions for contamination.
(f) Except as provided in subdivision 7, failure of the
county auditor to prepare or the county treasurer to deliver the
notice as required in this section does not invalidate the
proposed or final tax levy or the taxes payable pursuant to the
tax levy.
(g) If the notice the taxpayer receives under this section
lists the property as nonhomestead and the homeowner provides
satisfactory documentation to the county assessor that the
property is owned and has been used as the owner's homestead
prior to June 1 of that year, the assessor shall reclassify the
property to homestead for taxes payable in the following year.
(h) In the case of class 4 residential property used as a
residence for lease or rental periods of 30 days or more, the
taxpayer must either:
(1) mail or deliver a copy of the notice of proposed
property taxes to each tenant, renter, or lessee; or
(2) post a copy of the notice in a conspicuous place on the
premises of the property.
The notice must be mailed or posted by the taxpayer by
November 27 or within three days of receipt of the notice,
whichever is later. A taxpayer may notify the county treasurer
of the address of the taxpayer, agent, caretaker, or manager of
the premises to which the notice must be mailed in order to
fulfill the requirements of this paragraph.
(i) For purposes of this subdivision, subdivisions 5a and
6, "metropolitan special taxing districts" means the following
taxing districts in the seven-county metropolitan area that levy
a property tax for any of the specified purposes listed below:
(1) metropolitan council under section 473.132, 473.167,
473.249, 473.325, 473.446, 473.521, 473.547, or 473.834;
(2) metropolitan airports commission under section 473.667,
473.671, or 473.672; and
(3) metropolitan mosquito control commission under section
473.711.
For purposes of this section, any levies made by the
regional rail authorities in the county of Anoka, Carver,
Dakota, Hennepin, Ramsey, Scott, or Washington under chapter
398A shall be included with the appropriate county's levy and
shall be discussed at that county's public hearing.
Sec. 3. [276A.01] [DEFINITIONS.]
Subdivision 1. [APPLICABILITY.] In sections 3 to 11, the
terms defined in this section have the meanings given them
unless the context indicates otherwise.
Subd. 2. [AREA.] "Area" means the territory included
within all tax relief areas defined in section 273.134.
Subd. 3. [COMMERCIAL-INDUSTRIAL PROPERTY.]
"Commercial-industrial property" means the following categories
of property, as defined in section 273.13, excluding that
portion of the property (1) that may, by law, constitute the tax
base for a tax increment pledged pursuant to section 469.042 or
469.162, certification of which was requested prior to May 1,
1996, to the extent and while the tax increment is so pledged;
or (2) that is exempt from taxation under section 272.02:
(1) that portion of class 5 property consisting of unmined
iron ore and low-grade iron-bearing formations as defined in
section 273.14, tools, implements, and machinery, except the
portion of high voltage transmission lines, the value of which
is deducted from net tax capacity under section 273.425; and
(2) that portion of class 3 and class 5 property which is
either used or zoned for use for any commercial or industrial
purpose, except for such property which is, or, in the case of
property under construction, will when completed be used
exclusively for residential occupancy and the provision of
services to residential occupants thereof. Property must be
considered as used exclusively for residential occupancy only if
each of not less than 80 percent of its occupied residential
units is, or, in the case of property under construction, will
when completed be occupied under an oral or written agreement
for occupancy over a continuous period of not less than 30 days.
If the classification of property prescribed by section
273.13 is modified by legislative amendment, the references in
this subdivision are to the successor class or classes of
property, or portions thereof, that include the kinds of
property designated in this subdivision.
Subd. 4. [RESIDENTIAL PROPERTY.] "Residential property"
means the following categories of property, as defined in
section 273.13, excluding that portion of the property that is
exempt from taxation pursuant to section 272.02:
(1) class 1a, 1b, and 2a property, limited to the homestead
dwelling, a garage, and the one acre of land on which the
dwelling is located;
(2) that portion of class 3 property used exclusively for
residential occupancy; and
(3) property valued and assessed under section 273.13,
subdivision 25, except for hospitals and property valued and
assessed under paragraph (c), clauses (5) and (6).
Subd. 5. [GOVERNMENTAL UNIT.] "Governmental unit" means a
county, city, town, school district, or other taxing unit or
body which levies ad valorem taxes in whole or in part within
the area.
Subd. 6. [ADMINISTRATIVE AUDITOR.] "Administrative auditor"
means the person selected under section 4.
Subd. 7. [POPULATION.] "Population" means the most recent
estimate of the population of a municipality made by the state
demographer and filed with the commissioner of revenue. The
state demographer shall annually estimate the population of each
municipality and, in the case of a municipality which is located
partly within and partly without the area, the proportion of the
total which resides within the area, and shall file the
estimates with the commissioner of revenue.
Subd. 8. [MUNICIPALITY.] "Municipality" means a city,
town, or township located in whole or part within the area. If
a municipality is located partly within and partly without the
area, the references in sections 3 to 11 to property or any
portion thereof subject to taxation or taxing jurisdiction
within the municipality are to the property or portion thereof
that is located in that portion of the municipality within the
area, except that the fiscal capacity of the municipality must
be computed upon the basis of the valuation and population of
the entire municipality. A municipality shall be excluded from
the area if its municipal comprehensive zoning and planning
policies conscientiously exclude most commercial-industrial
development, for reasons other than preserving an agricultural
use. The iron range resources and rehabilitation board and the
commissioner of revenue shall jointly make this determination
annually and shall notify those municipalities that are
ineligible to participate in the tax base sharing program
provided in this chapter for the following year.
Subd. 9. [COUNTY.] "County" means each county in which a
governmental unit is located in whole or in part.
Subd. 10. [MARKET VALUE.] "Market value" of real and
personal property within a municipality means the assessor's
estimated market value of all real and personal property,
including the value of manufactured housing, within the
municipality. For purposes of sections 3 to 11, the
commissioner of revenue shall annually make determinations and
reports with respect to each municipality which are comparable
to those it makes for school districts under section 124.2131,
subdivision 1, in the same manner and at the same times
prescribed by the subdivision. The commissioner of revenue
shall annually determine, for each municipality, information
comparable to that required by section 475.53, subdivision 4,
for school districts, as soon as practicable after it becomes
available. The commissioner of revenue shall then compute the
equalized market value of property within each municipality.
Subd. 11. [VALUATION.] "Valuation" means the market value
of real and personal property within a municipality as defined
in subdivision 10.
Subd. 12. [FISCAL CAPACITY.] "Fiscal capacity" of a
municipality means its valuation, determined as of January 2 of
any year, divided by its population, determined as of a date in
the same year.
Subd. 13. [AVERAGE FISCAL CAPACITY.] "Average fiscal
capacity" of municipalities means the sum of the valuations of
all municipalities, determined as of January 2 of any year,
divided by the sum of their populations, determined as of a date
in the same year.
Subd. 14. [LEVY.] "Levy" means the amount certified to the
county auditor pursuant to chapter 275, less all reductions made
by the auditor pursuant to any provision of law in determining
the amount to be spread against taxable property.
Subd. 15. [NET TAX CAPACITY.] "Net tax capacity" means the
market value of real and personal property multiplied by its net
tax capacity rates in section 273.13.
Subd. 16. [LOCAL TAX RATE.] "Local tax rate" means a
governmental unit's levy, including any portion levied against
market value under section 124A.03, subdivision 2a, divided by
its net tax capacity.
Sec. 4. [276A.02] [ADMINISTRATIVE AUDITOR.]
Subdivision 1. [ELECTION.] On or before July 1, 1997, and
each subsequent odd-numbered year, the auditors of the counties
within the area shall meet at the call of the auditor of St.
Louis county and elect from among themselves one auditor to
serve as administrative auditor for a period of two years and
until a successor is elected. If a majority is unable to agree
upon a person to serve as administrative auditor, the
commissioner of revenue shall appoint one from among the
auditors of the counties in the area. If the administrative
auditor ceases to serve as a county auditor within the area
during the term for which he was elected or appointed, a
successor must be chosen in the manner provided for the original
selection to serve for the unexpired term.
Subd. 2. [STAFF; EXPENSES.] The administrative auditor
shall utilize the staff and facilities of the auditor's office
of the county the administrative auditor serves to perform the
functions imposed upon the administrative auditor by sections 3
to 11. That county shall be reimbursed for the marginal
expenses incurred by its county auditor and staff under this
section by contributions from each other county in the area in
an amount which bears the same proportion to the total expenses
that the population of the other county bears to the total
population of the area. By February 1 each year, the
administrative auditor shall certify the amounts of total
expense for the preceding calendar year, and the share of each
county, to the treasurer of each other county. Payment must be
made by the treasurer of each other county to the treasurer of
the county incurring expense by the succeeding March 1.
Sec. 5. [276A.03] [NET TAX CAPACITY OF
COMMERCIAL-INDUSTRIAL PROPERTY.]
By August 5 of 1996 and each subsequent year, the assessors
within each county in the area shall determine and certify to
the county auditor the net tax capacity in that year of
commercial-industrial property subject to taxation within each
municipality in the county, determined without regard to section
469.177, subdivision 3. By August 5 of 1996 only, the assessor
within each county in the area shall also determine and certify
to the county auditor the net tax capacity for the 1995
assessment of commercial-industrial property subject to taxation
within each municipality within the county determined without
regard to section 469.177, subdivision 3.
Sec. 6. [276A.04] [INCREASE IN NET TAX CAPACITY.]
By July 15 of 1997 and each subsequent year, the auditor of
each county in the area shall determine the amount, if any, by
which the net tax capacity determined in the preceding year
pursuant to section 5, of commercial-industrial property subject
to taxation within each municipality in the county exceeds the
net tax capacity in 1995 of commercial-industrial property
subject to taxation within that municipality. If a municipality
is located in two or more counties within the area, the auditors
of those counties shall certify the data required by section 5
to the county auditor responsible for allocating the levies of
that municipality between or among the affected counties. That
county auditor shall determine the amount of the net excess, if
any, for the municipality under this section, and certify that
amount under section 7. The increase in total net tax capacity
determined by this section must be reduced by the amount of any
decreases in the net tax capacity of commercial-industrial
property resulting from any court decisions, court-related
stipulation agreements, or abatements for a prior year, and only
in the amount of such decreases made during the 12-month period
ending on May 1 of the current assessment year, where the
decreases, if originally reflected in the determination of a
prior year's net tax capacity under section 5, would have
resulted in a smaller contribution from the municipality in that
year. An adjustment for the decreases shall be made only if the
municipality made a contribution in a prior year based on the
higher net tax capacity of the commercial-industrial property.
Sec. 7. [276A.05] [COMPUTATION OF AREAWIDE TAX BASE.]
Subdivision 1. [AREAWIDE NET TAX CAPACITY.] Each county
auditor shall certify the determinations under sections 5 and 6
to the administrative auditor on or before August 1 of each
year. The administrative auditor shall determine an amount
equal to 40 percent of the sum of the amounts certified pursuant
to section 6. The resulting amount shall be known as the
"areawide net tax capacity for ........(year)."
Subd. 2. [POPULATION AND FISCAL CAPACITY
CERTIFICATIONS.] The commissioner of revenue shall certify to
the administrative auditor, on or before August 10 of each year,
the population of each municipality for the preceding year, the
proportion of that population which resides within the area, the
average fiscal capacity of municipalities for the preceding
year, and the fiscal capacity of each municipality for the
preceding year.
Subd. 3. [AREAWIDE TAX BASE DISTRIBUTION INDEX.] The
administrative auditor shall determine, for each municipality,
the product of (1) its population, (2) the proportion which the
average fiscal capacity of municipalities for the preceding year
bears to the fiscal capacity of that municipality for the
preceding year. The product shall be the areawide tax base
distribution index for that municipality. If a municipality is
located partly within and partly without the area, its index is
that which is otherwise determined hereunder, multiplied by the
proportion which its population residing within the area bears
to its total population as of the preceding year.
Subd. 4. [DISTRIBUTION NET TAX CAPACITY.] The
administrative auditor shall determine the proportion which the
index of each municipality bears to the sum of the indices of
all municipalities and shall then multiply this proportion in
the case of each municipality, by the areawide net tax capacity.
Subd. 5. [CERTIFICATION.] The product of the procedure
prescribed by subdivision 4 shall be known as the "areawide net
tax capacity for ......(year) attributable to
..........(municipality)." The administrative auditor shall
certify the product to the auditor of the county in which the
municipality is located on or before August 15.
Sec. 8. [276A.06] [NET TAX CAPACITY OF GOVERNMENTAL UNIT.]
Subdivision 1. [GENERALLY.] The county auditor shall
determine the net tax capacity of each governmental unit within
the county in the manner prescribed by this section.
Subd. 2. [DEFINITION.] The net tax capacity of a
governmental unit is its net tax capacity as determined in
accordance with other provisions of law including section
469.177, subdivision 3, subject to the following adjustments:
(a) There must be subtracted from its net tax capacity, in
each municipality in which the governmental unit exercises ad
valorem taxing jurisdiction, an amount that bears the same
proportion to 40 percent of the amount certified in that year
pursuant to sections 6 and 7 for the municipality as the total
preceding year's net tax capacity of commercial-industrial
property which is subject to the taxing jurisdiction of the
governmental unit within the municipality, determined without
regard to section 469.177, subdivision 3, bears to the total
preceding year's net tax capacity of commercial-industrial
property within the municipality, determined without regard to
section 469.177, subdivision 3.
(b) There must be added to its net tax capacity, in each
municipality in which the governmental unit exercises ad valorem
taxing jurisdiction, an amount which bears the same proportion
to the areawide net tax capacity for the year attributable to
that municipality as the total preceding year's net tax capacity
of residential property which is subject to the taxing
jurisdiction of the governmental unit within the municipality
bears to the total preceding year's net tax capacity of
residential property of the municipality.
Subd. 3. [APPORTIONMENT OF LEVY.] The county auditor shall
apportion the levy of each governmental unit in the county in
the manner prescribed by this subdivision. The auditor shall:
(a) by August 20 of 1997 and each subsequent year,
determine the areawide portion of the levy for each governmental
unit by multiplying the local tax rate of the governmental unit
for the preceding levy year times the distribution value set
forth in subdivision 2, clause (b); and
(b) by September 5 of 1997 and each subsequent year,
determine the local portion of the current year's levy by
subtracting the resulting amount from clause (a) from the
governmental unit's current year's levy.
Subd. 4. [TAX RATE NONCOMMERCIAL PROPERTY.] In 1997 and
subsequent years, the county auditor shall divide that portion
of the levy determined pursuant to subdivision 3, clause (b), by
the net tax capacity of the governmental unit, taking section
469.177, subdivision 3, into account, less that portion
subtracted from net tax capacity pursuant to subdivision 2,
clause (a). The resulting rate applies to all taxable property
except commercial-industrial property, which must be taxed in
accordance with subdivision 7.
Subd. 5. [AREAWIDE TAX RATE.] On or before August 25 of
1997 and each subsequent year, the county auditor shall certify
to the administrative auditor that portion of the levy of each
governmental unit determined pursuant to subdivision 3, clause
(a). The administrative auditor shall then determine the
areawide tax rate sufficient to yield an amount equal to the sum
of the levies from the areawide net tax capacity. On or before
September 1, the administrative auditor shall certify the
areawide tax rate to each of the county auditors.
Subd. 6. [GOVERNMENTAL UNIT IN TWO OR MORE COUNTIES.] If a
governmental unit is located in two or more counties, the
computations and certifications required by subdivisions 3 to 5
with respect to it must be made by the county auditor who is
responsible for allocating its levies between or among the
affected counties.
Subd. 7. [APPLICATION TO COMMERCIAL-INDUSTRIAL
PROPERTY.] The areawide tax rate determined in accordance with
subdivision 5 applies to each commercial-industrial property
subject to taxation within a municipality, including property
located within any tax increment financing district, as defined
in section 469.174, subdivision 9, to that portion of the net
tax capacity of the item which bears the same proportion to its
total net tax capacity as 40 percent of the amount determined
pursuant to sections 6 and 7 is to the amount determined
pursuant to section 5. The rate of taxation determined in
accordance with subdivision 4 applies in the taxation of the
remainder of the net tax capacity of the item.
Subd. 8. [CERTIFICATION OF VALUES; PAYMENT.] The
administrative auditor shall determine for each county the
difference between the total levy on distribution value pursuant
to subdivision 3, clause (a), within the county and the total
tax on contribution value pursuant to subdivision 7, within the
county. On or before May 16 of each year, the administrative
auditor shall certify the differences so determined to each
county auditor. In addition, the administrative auditor shall
certify to those county auditors for whose county the total tax
on contribution value exceeds the total levy on distribution
value the settlement the county is to make to the other counties
of the excess of the total tax on contribution value over the
total levy on distribution value in the county. On or before
June 15 and November 15 of each year, each county treasurer in a
county having a total tax on contribution value in excess of the
total levy on distribution value shall pay one-half of the
excess to the other counties in accordance with the
administrative auditor's certification.
Subd. 9. [FISCAL DISPARITIES ADJUSTMENT.] In any year in
which the highest class rate for class 3a property changes from
the rate in the previous year, the following adjustments shall
be made to the procedures described in sections 6 to 8:
(1) An initial contribution tax capacity shall be
determined for each municipality based on the previous year's
class rates.
(2) Each jurisdiction's distribution tax capacity shall be
determined based upon the areawide tax base determined by
summing the tax capacities computed under clause (1) for all
municipalities and apportioning the resulting sum pursuant to
section 7, subdivision 5.
(3) Each jurisdiction's distribution levy shall be
determined by applying the procedures described in subdivision
3, clause (a), to the distribution tax capacity determined
pursuant to clause (2).
(4) Each municipality's final contribution tax capacity
shall be determined equal to its initial contribution tax
capacity multiplied by the ratio of the new highest class rate
for class 3a property to the previous year's highest class rate
for class 3a property.
(5) For the purposes of computing education aids and any
other state aids requiring the addition of the fiscal
disparities distribution tax capacity to the local tax capacity,
each municipality's final distribution tax capacity shall be
determined equal to its initial distribution tax capacity
multiplied by the ratio of the new highest class rate for class
3a property to the previous year's highest class rate for class
3a property.
(6) The areawide tax rate shall be determined by dividing
the sum of the amounts determined in clause (3) by the sum of
the values determined in clause (4).
(7) The final contribution tax capacity determined in
clause (4) shall also be used to determined the portion of each
commercial-industrial property's tax capacity subject to the
areawide tax rate pursuant to subdivision 7.
Subd. 10. [ADJUSTMENT OF VALUES FOR OTHER COMPUTATIONS.]
For the purpose of computing the amount or rate of any salary,
aid, tax, or debt authorized, required, or limited by any
provision of any law or charter, where the authorization,
requirement, or limitation is related to any value or valuation
of taxable property within any governmental unit, the value or
net tax capacity must be adjusted to reflect the adjustments to
net tax capacity effected by subdivision 2, provided that: (1)
in determining the market value of commercial-industrial
property or any class thereof within a governmental unit for any
purpose other than section 7, (a) the reduction required by this
subdivision is that amount which bears the same proportion to
the amount subtracted from the governmental unit's net tax
capacity pursuant to subdivision 2, clause (a), as the market
value of commercial-industrial property, or such class thereof,
located within the governmental unit bears to the net tax
capacity of commercial-industrial property, or such class
thereof, located within the governmental unit, and (b) the
increase required by this subdivision is that amount which bears
the same proportion to the amount added to the governmental
unit's net tax capacity pursuant to subdivision 2, clause (b),
as the market value of commercial-industrial property, or such
class thereof, located within the governmental unit bears to the
net tax capacity of commercial-industrial property, or such
class thereof, located within the governmental unit; and (2) in
determining the market value of real property within a
municipality for purposes of section 7, the adjustment
prescribed by clause (1)(a) must be made and that prescribed by
clause (1)(b) must not be made.
Sec. 9. [276A.07] [ADJUSTMENTS IN DATES.]
If, because of the enactment of any other law, the date by
which the commissioner of revenue is required to certify to the
county auditors the records of proceedings affecting the net tax
capacity of property is advanced to a date earlier than June 30,
the dates specified in sections 5 to 8 and 10 may be modified in
the years to which the other law applies in the manner and to
the extent prescribed by the administrative auditor.
Sec. 10. [276A.08] [REASSESSMENTS AND OMITTED PROPERTY.]
Subdivision 1. [REASSESSMENT ORDERS.] If the commissioner
of revenue orders a reassessment of all or any portion of the
property in a municipality other than in the form of a
mathematically prescribed adjustment of valuation, or if omitted
property is placed upon the tax rolls, and the reassessment has
not been completed or the property placed upon the rolls by
November 15, the net tax capacity of the affected property must,
for purposes of sections 4 to 8, be determined from the
abstracts filed by the county auditor with the commissioner of
revenue.
Subd. 2. [ADJUSTMENT OF VALUE.] If the reassessment, when
completed and incorporated in the commissioner's certification
of the net tax capacity of the municipality, or the listing of
omitted property, when placed on the rolls, results in an
increase in the net tax capacity of commercial-industrial
property in the municipality which differs from that used,
pursuant to subdivision 1, for purposes of sections 4 to 8, the
increase in the net tax capacity of commercial-industrial
property in that municipality in the succeeding year, as
otherwise computed under section 6, must be adjusted in a like
amount, by an increase if the reassessment or listing discloses
a larger increase than was used for purposes of sections 4 to 8,
or by a decrease if the reassessment or listing discloses a
smaller increase than was used for those purposes, provided that
no adjustment shall reduce the amount determined under section 6
to an amount less than zero.
Subd. 3. [EXCEPTIONS.] Subdivisions 1 and 2 do not apply
to the determination of the tax rate under section 8,
subdivision 4, or to the determination of the net tax capacity
of commercial-industrial property and each item thereof for
purposes of section 8, subdivision 7.
Sec. 11. [276A.09] [CHANGE IN STATUS OF MUNICIPALITY.]
If a municipality is dissolved, is consolidated with all or
part of another municipality, annexes territory, has a portion
of its territory detached from it, or is newly incorporated, the
secretary of state shall immediately certify that fact to the
commissioner of revenue. The secretary of state shall also
certify to the commissioner of revenue the current population of
the new, enlarged, or successor municipality, if determined by
the Minnesota municipal board incident to consolidation,
annexation, or incorporation proceedings. The population so
certified shall govern for purposes of sections 3 to 11 until
the state demographer files the first population estimate as of
a later date with the commissioner of revenue. If an annexation
of unincorporated land occurs without proceedings before the
Minnesota municipal board, the population of the annexing
municipality as previously determined shall continue to govern
for purposes of sections 3 to 11 until the state demographer
files the first population estimate as of a later date with the
commissioner of revenue.
Sec. 12. Minnesota Statutes 1995 Supplement, section
428A.05, is amended to read:
428A.05 [COLLECTION OF SERVICE CHARGES.]
Service charges may be imposed on the basis of the net tax
capacity of the property on which the service charge is imposed
but must be spread only upon the net tax capacity of the taxable
property located in the geographic area described in the
ordinance. Service charges based on net tax capacity may be
payable and collected at the same time and in the same manner as
provided for payment and collection of ad valorem taxes. When
made payable in the same manner as ad valorem taxes, service
charges not paid on or before the applicable due date shall be
subject to the same penalty and interest as in the case of ad
valorem tax amounts not paid by the respective due date. The
due date for a service charge payable in the same manner as ad
valorem taxes is the due date given in law for the real or
personal property tax for the property on which the service
charge is imposed. Service charges imposed on net tax capacity
which are to become payable in the following year must be
certified to the county auditor by the date provided in section
429.061, subdivision 3, for the annual certification of special
assessment installments. Other service charges imposed must be
collected as provided by ordinance. Service charges based on
net tax capacity collected under sections 428A.01 to 428A.10 are
not included in computations under section 469.177, chapter 276A
or 473F, or any other law that applies to general ad valorem
levies. For the purpose of this section, "net tax capacity"
means the net tax capacity most recently determined at the time
that tax rates are determined under section 275.08.
Sec. 13. Minnesota Statutes 1995 Supplement, section
465.82, subdivision 2, is amended to read:
Subd. 2. [CONTENTS OF PLAN.] The plan must state:
(1) the specific cooperative activities the units will
engage in during the first two years of the venture;
(2) the steps to be taken to effect the merger of the
governmental units, with completion no later than four years
after the process begins;
(3) the steps by which a single governing body will be
created;
(4) changes in services provided, facilities used,
administrative operations and staffing to effect the preliminary
cooperative activities and the final merger and a two-, five-,
and ten-year projection of expenditures for each unit if it
combined and if it remained separate;
(5) treatment of employees of the merging governmental
units, specifically including provisions for reassigning
employees, dealing with unions, and providing financial
incentives to encourage early retirements;
(6) financial arrangements for the merger, specifically
including responsibility for debt service on outstanding
obligations of the merging entities;
(7) one- and two-year impact analysis, prepared by the
granting state agency at the request of the local government
unit, of major state aid revenues received for each unit if it
combined and if it remained separate. This would also include
an impact analysis, prepared by the department of revenue, of
property tax revenue implications, if any, associated with tax
increment financing districts and fiscal disparities under
chapter 276A or 473F resulting from the merger;
(8) procedures for a referendum to be held before the
proposed combination to approve combining the local government
units, specifically stating whether a majority of those voting
in each district proposed for combination or a majority of those
voting on the question in the entire area proposed for
combination would be needed to pass the referendum; and
(9) a time schedule for implementation.
Notwithstanding clause (3) or any other law to the
contrary, all current members of the governing bodies of the
local governmental units that propose to combine under sections
465.81 to 465.88 may serve on the initial governing body of the
combined unit until a gradual reduction in membership is
achieved by foregoing election of new members when terms expire
until the number permitted by other law is reached.
Sec. 14. Minnesota Statutes 1995 Supplement, section
469.175, subdivision 5, is amended to read:
Subd. 5. [ANNUAL DISCLOSURE.] For all tax increment
financing districts, whether created prior or subsequent to
August 1, 1979, on or before July 1 of each year, the authority
shall submit to the county board, the county auditor, the school
board, state auditor and, if the authority is other than the
municipality, the governing body of the municipality, a report
of the status of the district. The report shall include the
following information: the amount and the source of revenue in
the account, the amount and purpose of expenditures from the
account, the amount of any pledge of revenues, including
principal and interest on any outstanding bonded indebtedness,
the original net tax capacity of the district, the captured net
tax capacity retained by the authority, the captured net tax
capacity shared with other taxing districts, the tax increment
received, and any additional information necessary to
demonstrate compliance with any applicable tax increment
financing plan. An annual statement showing the tax increment
received and expended in that year, the original net tax
capacity, captured net tax capacity, amount of outstanding
bonded indebtedness, the amount of the district's increments
paid to other governmental bodies, the amount paid for
administrative costs, the sum of increments paid, directly or
indirectly, for activities and improvements located outside of
the district, and any additional information the authority deems
necessary shall be published in a newspaper of general
circulation in the municipality. If the fiscal disparities
contribution under chapter 276A or 473F for the district is
computed under section 469.177, subdivision 3, paragraph (a),
the annual statement must disclose that fact and indicate the
amount of increased property tax imposed on other properties in
the municipality as a result of the fiscal disparities
contribution. The commissioner of revenue shall prescribe the
form of this statement and the method for calculating the
increased property taxes.
Sec. 15. Minnesota Statutes 1994, section 469.177,
subdivision 3, is amended to read:
Subd. 3. [TAX INCREMENT, RELATIONSHIP TO CHAPTER CHAPTERS
276A AND 473F.] (a) Unless the governing body elects pursuant to
clause (b) the following method of computation shall apply:
(1) The original net tax capacity and the current net tax
capacity shall be determined before the application of the
fiscal disparity provisions of chapter 276A or 473F. Where the
original net tax capacity is equal to or greater than the
current net tax capacity, there is no captured net tax capacity
and no tax increment determination. Where the original net tax
capacity is less than the current net tax capacity, the
difference between the original net tax capacity and the current
net tax capacity is the captured net tax capacity. This amount
less any portion thereof which the authority has designated, in
its tax increment financing plan, to share with the local taxing
districts is the retained captured net tax capacity of the
authority.
(2) The county auditor shall exclude the retained captured
net tax capacity of the authority from the net tax capacity of
the local taxing districts in determining local taxing district
tax rates. The local tax rates so determined are to be extended
against the retained captured net tax capacity of the authority
as well as the net tax capacity of the local taxing districts.
The tax generated by the extension of the lesser of (A) the
local taxing district tax rates or (B) the original local tax
rate to the retained captured net tax capacity of the authority
is the tax increment of the authority.
(b) The governing body may, by resolution approving the tax
increment financing plan pursuant to section 469.175,
subdivision 3, elect the following method of computation:
(1) The original net tax capacity shall be determined
before the application of the fiscal disparity provisions of
chapter 276A or 473F. The current net tax capacity shall
exclude any fiscal disparity commercial-industrial net tax
capacity increase between the original year and the current year
multiplied by the fiscal disparity ratio determined pursuant to
section 276A.06, subdivision 7, or 473F.08, subdivision 6.
Where the original net tax capacity is equal to or greater than
the current net tax capacity, there is no captured net tax
capacity and no tax increment determination. Where the original
net tax capacity is less than the current net tax capacity, the
difference between the original net tax capacity and the current
net tax capacity is the captured net tax capacity. This amount
less any portion thereof which the authority has designated, in
its tax increment financing plan, to share with the local taxing
districts is the retained captured net tax capacity of the
authority.
(2) The county auditor shall exclude the retained captured
net tax capacity of the authority from the net tax capacity of
the local taxing districts in determining local taxing district
tax rates. The local tax rates so determined are to be extended
against the retained captured net tax capacity of the authority
as well as the net tax capacity of the local taxing districts.
The tax generated by the extension of the lesser of (A) the
local taxing district tax rates or (B) the original local tax
rate to the retained captured net tax capacity of the authority
is the tax increment of the authority.
(3) An election by the governing body pursuant to paragraph
(b) shall be submitted to the county auditor by the authority at
the time of the request for certification pursuant to
subdivision 1.
(c) The method of computation of tax increment applied to a
district pursuant to paragraph (a) or (b) shall remain the same
for the duration of the district, except that the governing body
may elect to change its election from the method of computation
in paragraph (a) to the method in paragraph (b).
Sec. 16. Minnesota Statutes 1994, section 477A.011,
subdivision 20, is amended to read:
Subd. 20. [CITY NET TAX CAPACITY.] "City net tax capacity"
means (1) the net tax capacity computed using the net tax
capacity rates in section 273.13, and the market values for
taxes payable in the year prior to the aid distribution plus (2)
a city's fiscal disparities distribution tax capacity under
section 276A.06, subdivision 2, paragraph (b), or 473F.08,
subdivision 2, paragraph (b), for taxes payable in the year
prior to that for which aids are being calculated. The market
value utilized in computing city net tax capacity shall be
reduced by the sum of (1) a city's market value of commercial
industrial property as defined in section 276A.01, subdivision
3, or 473F.02, subdivision 3, multiplied by the ratio determined
pursuant to section 276A.06, subdivision 2, paragraph (a), or
473F.08, subdivision 2, paragraph (a), (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 city net tax capacity will
be computed using equalized market values.
Sec. 17. Minnesota Statutes 1994, section 477A.011,
subdivision 27, is amended to read:
Subd. 27. [REVENUE BASE.] "Revenue base" means the amount
levied for taxes payable in the previous year, including the
levy on the fiscal disparity distribution under section 276A.06,
subdivision 3, paragraph (a), or 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 originally certified local government aid in the
previous year under sections 477A.011, 477A.012, and 477A.013,
except for 477A.013, subdivision 5; and the taconite aids
received in the previous year under sections 298.28 and 298.282.
Sec. 18. Minnesota Statutes 1994, section 477A.011,
subdivision 32, is amended to read:
Subd. 32. [COMMERCIAL INDUSTRIAL PERCENTAGE.] "Commercial
industrial percentage" for a city is 100 times the sum of the
estimated market values of all real property in the city
classified as class 3 under section 273.13, subdivision 24,
excluding public utility property, to the total market value of
all taxable real and personal property in the city. The market
values are the amounts computed before any adjustments for
fiscal disparities under section 276A.06 or 473F.08. The market
values used for this subdivision are not equalized.
Sec. 19. Minnesota Statutes 1994, section 477A.011,
subdivision 35, is amended to read:
Subd. 35. [TAX EFFORT RATE.] "Tax effort rate" means the
sum of the net levy for all cities divided by the sum of the
city net tax capacity for all cities. For purposes of this
section, "net levy" means the city levy, after all adjustments,
used for calculating the local tax rate under section 275.08 for
taxes payable in the year prior to the aid distribution. The
fiscal disparity distribution levy under chapter 276A or 473F is
included in net levy.
Sec. 20. [EFFECTIVE DATE.]
Sections 1 to 19 are effective July 1, 1997, for taxes
levied in 1997, payable in 1998 and subsequent years, except as
provided in section 5.
ARTICLE 12
TACONITE TAXES
Section 1. Minnesota Statutes 1995 Supplement, section
298.227, is amended to read:
298.227 [TACONITE ECONOMIC DEVELOPMENT FUND.]
An amount equal to that distributed pursuant to each
taconite producer's taxable production and qualifying sales
under section 298.28, subdivision 9a, shall be held by the iron
range resources and rehabilitation board in a separate taconite
economic development fund for each taconite and direct reduced
ore producer. Money from the fund for each producer shall be
released only on the written authorization of a joint committee
consisting of an equal number of representatives of the salaried
employees and the nonsalaried production and maintenance
employees of that producer. The district 33 11 director of the
United States Steelworkers of America, on advice of each local
employee president, shall select the employee members. In
nonorganized operations, the employee committee shall be elected
by the nonsalaried production and maintenance employees. Each
producer's joint committee may authorize release of the funds
held pursuant to this section only for acquisition of equipment
and facilities for the producer or for research and development
in Minnesota on new mining, or taconite, iron, or steel
production technology. Funds may be released only upon a
majority vote of the representatives of the committee. If a
taconite production facility is sold after operations at the
facility had ceased, any money remaining in the fund for the
former producer may be released to the purchaser of the facility
on the terms otherwise applicable to the former producer under
this section. Any portion of the fund which is not released by
a joint committee within two years of its deposit in the fund
shall be divided between the taconite environmental protection
fund created in section 298.223 and the northeast Minnesota
economic protection trust fund created in section 298.292 for
placement in their respective special accounts. Two-thirds of
the unreleased funds shall be distributed to the taconite
environmental protection fund and one-third to the northeast
Minnesota economic protection trust fund. This section is
effective for taxes payable in 1993 and 1994.
Sec. 2. Minnesota Statutes 1995 Supplement, section
298.24, subdivision 1, is amended to read:
Subdivision 1. (a) For concentrate produced in 1992, 1993,
1994, and 1995 there is 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 $2.054 per gross ton of
merchantable iron ore concentrate produced therefrom.
(b) For concentrates produced in 1996 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, provided that, for concentrates
produced in 1996 only, the increase in the rate of tax imposed
under this section over the rate imposed for the previous year
may not exceed four cents per ton. "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 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 $2.054 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.
(f)(1) Notwithstanding any other provision of this
subdivision, for the first five years of a plant's production of
direct reduced ore, the rate of the tax on direct reduced ore is
determined under this paragraph. As used in this paragraph,
"direct reduced ore" is ore that results in a product that has
an iron content of at least 75 percent. The rate to be applied
to direct reduced ore is 25 percent of the rate otherwise
determined under this subdivision for the first 500,000 of
taxable tons for the production year, and 50 percent of the rate
otherwise determined for any remainder. If the taxpayer had no
production in the two years prior to the the current production
year, the tonnage eligible to be taxed at 25 percent of the rate
otherwise determined under this subdivision is the first 166,667
tons. If the taxpayer had some production in the year prior to
the current production year but no production in the second
prior year, the tonnage eligible to be taxed at 25 percent of
the rate otherwise determined under this subdivision is the
first 333,333 tons.
(2) Production of direct reduced ore in this state is
subject to the tax imposed by this section, but if that
production is not produced by a producer of taconite or iron
sulfides, the production of taconite or iron sulfides consumed
in the production of direct reduced iron in this state is not
subject to the tax imposed by this section on taconite or iron
sulfides.
Sec. 3. Minnesota Statutes 1994, section 298.28,
subdivision 2, is amended to read:
Subd. 2. [CITY OR TOWN WHERE QUARRIED OR PRODUCED.]
2.5 4.5 cents per gross ton of merchantable iron ore
concentrate, hereinafter referred to as "taxable ton," must be
allocated to the city or town in the county in which the lands
from which taconite was mined or quarried were located or within
which the concentrate was produced. If the mining, quarrying,
and concentration, or different steps in either thereof are
carried on in more than one taxing district, the commissioner
shall apportion equitably the proceeds of the part of the tax
going to cities and towns among such subdivisions upon the basis
of attributing 40 percent of the proceeds of the tax to the
operation of mining or quarrying the taconite, and the remainder
to the concentrating plant and to the processes of
concentration, and with respect to each thereof giving due
consideration to the relative extent of such operations
performed in each such taxing district. The commissioner's
order making such apportionment shall be subject to review by
the tax court at the instance of any of the interested taxing
districts, in the same manner as other orders of the
commissioner.
Sec. 4. Minnesota Statutes 1994, section 298.28,
subdivision 6, is amended to read:
Subd. 6. [PROPERTY TAX RELIEF.] (a) Fifteen cents per
taxable ton, less any amount required to be distributed under
paragraphs (b) and (c), and less any amount required to be
deducted under paragraph (d), must be allocated to St. Louis
county acting as the counties' fiscal agent, to be distributed
as provided in sections 273.134 to 273.136.
(b) If an electric power plant owned by and providing the
primary source of power for a taxpayer mining and concentrating
taconite is located in a county other than the county in which
the mining and the concentrating processes are conducted, .1875
cent per taxable ton of the tax imposed and collected from such
taxpayer shall be paid to the county.
(c) If an electric power plant owned by and providing the
primary source of power for a taxpayer mining and concentrating
taconite is located in a school district other than a school
district in which the mining and concentrating processes are
conducted, .5625 cent per taxable ton of the tax imposed and
collected from the taxpayer shall be paid to the school district.
(d) Two cents per taxable ton must be deducted from the
amount allocated to the St. Louis county auditor under paragraph
(a).
Sec. 5. Minnesota Statutes 1995 Supplement, section
298.28, subdivision 9a, is amended to read:
Subd. 9a. [TACONITE ECONOMIC DEVELOPMENT FUND.] (a) 15.4
cents per ton for distributions in 1994, 1995, 1996, and 20.4
cents per ton for distributions in 1997, 1998, and 1999 shall be
paid to the taconite economic development fund. No distribution
shall be made under this paragraph in any year in which total
industry production falls below 30 million tons.
(b) An amount equal to 50 percent of the tax under section
298.24 for concentrate sold in the form of pellet chips and
fines not exceeding 5/16 inch in size and not including crushed
pellets shall be paid to the taconite economic development
fund. The amount paid shall not exceed $700,000 annually for
all companies. If the initial amount to be paid to the fund
exceeds this amount, each company's payment shall be prorated so
the total does not exceed $700,000.
Sec. 6. Minnesota Statutes 1994, section 298.296,
subdivision 2, is amended to read:
Subd. 2. [EXPENDITURE OF FUNDS.] Before January 1, 2002,
funds may be expended on projects and for administration of the
trust fund only from the net interest, earnings, and dividends
arising from the investment of the trust at any time, including
net interest, earnings, and dividends that have arisen prior to
July 13, 1982, plus $10,000,000 made available for use in fiscal
year 1983, except that any amount required to be paid out of the
trust fund to provide the property tax relief specified in Laws
1977, chapter 423, article X, section 4, and to make school bond
payments and payments to recipients of taconite production tax
proceeds pursuant to section 298.225, may be taken from the
corpus of the trust. Additionally, upon recommendation by the
board, up to $10,000,000 $13,000,000 from the corpus of the
trust may be made available for use as provided in subdivision
4, and up to $10,000,000 from the corpus of the trust may be
made available for use as provided in section 298.2961. On and
after January 1, 2002, funds may be expended on projects and for
administration from any assets of the trust. Annual
administrative costs, not including detailed engineering
expenses for the projects, shall not exceed five percent of the
net interest, dividends, and earnings arising from the trust in
the preceding fiscal year.
Principal and interest received in repayment of loans made
pursuant to this section, and earnings on other investments made
under section 298.292, subdivision 2, clause (4), shall be
deposited in the state treasury and credited to the trust.
These receipts are appropriated to the board for the purposes of
sections 298.291 to 298.298.
Sec. 7. Minnesota Statutes 1995 Supplement, section
298.296, subdivision 4, is amended to read:
Subd. 4. [TEMPORARY LOAN AUTHORITY.] (a) The board may
recommend that up to $10,000,000 from the corpus of the trust
may be used for loans as provided in this subdivision. The
money would be available for loans for construction and
equipping of facilities constituting (1) a value added iron
products plant, which may be either a new plant or a facility
incorporated into an existing plant that produces iron upgraded
to a minimum of 75 percent iron content or any iron alloy with a
total minimum metallic content of 90 percent; or (2) a new mine
or minerals processing plant for any mineral subject to the net
proceeds tax imposed under section 298.015. A loan under
this subdivision paragraph may not exceed $5,000,000 for any
facility.
(b) Additionally, the board must reserve the first
$2,000,000 of the net interest, dividends, and earnings arising
from the investment of the trust after June 30, 1996, to be used
for additional grants for the purposes set forth in paragraph
(a). This amount must be reserved until it is used for the
grants or until June 30, 1998, whichever is earlier.
(c) Additionally, the board may recommend that up to
$3,000,000 from the corpus of the trust may be used for
additional grants for the purposes set forth in paragraph (a).
(d) The board may require that it receive an equity
percentage in any project to which it contributes under this
section.
(e) The authority to make loans and grants under this
subdivision terminates December 31, 1997 June 30, 1998.
Sec. 8. [298.2961] [PRODUCER GRANTS.]
Subdivision 1. [APPROPRIATION.] $10,000,000 is
appropriated from the northeast Minnesota economic protection
trust fund to a special account in the taconite area
environmental protection fund for grants or loans to producers
on a project-by-project basis as provided in this section.
Subd. 2. [PROJECTS; APPROVAL.] (a) Projects funded must be
for:
(1) environmentally unique reclamation projects; or
(2) pit or plant expansions or modernizations other than
for a value added iron products plant that extend the life of
the plant.
(b) To be proposed by the board, a project must be approved
by at least eight iron range resources and rehabilitation board
members. The money for a project may be spent only upon
approval of the project by the governor. The board may submit
supplemental projects for approval at any time.
(c) The board may require that it receive an equity
percentage in any project to which it contributes under this
section.
Sec. 9. [EFFECTIVE DATES.]
Section 1 is effective for taxes payable in 1995 and
thereafter. Sections 3 to 6 are effective for production year
1996, distributions in 1997 and thereafter.
ARTICLE 13
MISCELLANEOUS
Section 1. Minnesota Statutes 1995 Supplement, section
16A.67, subdivision 5, is amended to read:
Subd. 5. [COVENANTS; AGREEMENTS.] The commissioner may,
for and on behalf of the state, enter into such covenants and
agreements not inconsistent with subdivisions 1 to 4 and
sections 246.18, subdivisions 4 and 6; and 349A.10, subdivision
5, as may be necessary or desirable to facilitate the sale and
issuance of the bonds on terms favorable to the state,
including, but not limited to, covenants and agreements relating
to the payment of and security for the bonds, tax-exemption, and
disclosure of information required by federal and state
securities laws. Such covenants and agreements of the
commissioner constitute an enforceable contract of the state and
the state pledges and agrees with the holders of any bonds that
the state will not limit or alter the rights vested in the
commissioner to fulfill the terms of any such covenants or
agreements made with the holders of the bonds, or in any way
impair the rights and remedies of the holders until the bonds,
together with the interest thereon, with interest on any unpaid
installments of interest, and all costs and expenses in
connection with any action or proceeding by or on behalf of such
holders, are fully met and discharged. The commissioner is
authorized to include this pledge and agreement of the state in
any covenant or agreement with the holders of such bonds. Such
covenants may not include covenants to continue to operate the
state lottery but may include covenants to continue to seek
payment by and reimbursement from nonstate sources of health
care costs so long as any bonds issued pursuant to this section
are outstanding. The provisions of sections 16A.672 and 16A.675
are applicable to the bonds.
Sec. 2. Minnesota Statutes 1994, section 115.26, is
amended by adding a subdivision to read:
Subd. 5. (a) In order to maintain the integrity of and
facilitate access to district systems, works, or facilities, the
district may maintain and repair a road by agreement with the
entity that was responsible for the performance of maintenance
and repair immediately prior to the agreement. Maintenance and
repair includes, but is not limited to, providing lighting, snow
removal, and grass mowing.
(b) A district shall establish a taxing subdistrict of
benefited property and shall levy special taxes, pursuant to
section 115.33, subdivision 2, for the purposes of paying the
cost of improvement or maintenance of a road under paragraph (a).
(c) For purposes of this subdivision, a district shall not
be construed as a road authority under chapter 160.
(d) The district and its officers and employees are exempt
from liability for any tort claim for injury to person or
property arising from travel on a road maintained by the
district and related to its maintenance or condition.
Sec. 3. Minnesota Statutes 1994, section 115A.919, is
amended by adding a subdivision to read:
Subd. 2a. [JOINT POWERS AGREEMENT.] If a facility is owned
by a joint powers board, total fees in excess of $1 per cubic
yard or equivalent may not be imposed or revenue expended under
subdivision 1 or 2 without the approval of the board.
Sec. 4. Minnesota Statutes 1994, section 115A.923,
subdivision 1a, is amended to read:
Subd. 1a. [PAYMENT OF THE GREATER MINNESOTA LANDFILL
CLEANUP FEE.] The operator of a disposal facility in greater
Minnesota shall remit the fees collected under 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 remit the fees to the city
that owns the facility and the operator of a facility that is
owned by a joint powers board shall remit the fees to the
board. The county, city, joint powers board, or sanitary
district may use the revenue from the fees only for the purposes
specified in section 115A.919.
Sec. 5. Minnesota Statutes 1994, section 270.067,
subdivision 2, is amended to read:
Subd. 2. [PREPARATION; SUBMISSION.] The commissioner of
revenue shall prepare a tax expenditure budget for the state.
The tax expenditure budget report shall be submitted to the
legislature as a supplement to the governor's budget and at the
same time as provided for submission of the budget pursuant to
section 16A.11, subdivision 1 by February 1 of each
even-numbered year.
Sec. 6. Minnesota Statutes 1994, section 270.102,
subdivision 1, is amended to read:
Subdivision 1. [DEFINITIONS.] (a) The following terms used
in this section have the following meanings.
(b) "Successor" means a person who directly or indirectly
purchases, acquires, is gifted, or succeeds to the business or
stock of goods of any person quitting, selling, or otherwise
disposing of a business or stock of goods. Successor does not
include a personal representative or beneficiary of an estate, a
trustee in bankruptcy, a debtor in possession, a receiver, a
secured party, a mortgagee, an assignee of rents, or any other
lienholder.
(c) "Person" means an individual, partnership, corporation,
sole proprietorship, joint venture, limited liability company,
or any other type of business entity or association.
(d) "Withhold" means setting aside money or dealing with
the payment of consideration in a manner that denies a
transferring business the benefit of the transfer in an amount
equal to the sales and withholding tax liability of the
transferring business.
(e) "Purchase price" means the consideration paid or to be
paid for the transfer by the successor to the transferring
business, and includes amounts paid for tangible property or
intangibles such as leases, licenses, or goodwill. Purchase
price also includes debts assumed or forgiven by the successor,
or real or personal property conveyed or to be conveyed by the
successor to the transferring business.
(f) "Arm's length transaction" means a transfer for
adequate consideration between independent parties both acting
in their own best interests. If the parties are related to each
other, a rebuttable presumption arises that the transaction is
not at arm's length.
(g) "Transfer" means every mode, direct or indirect,
absolute or conditional, voluntary or involuntary, of disposing
of or parting with a business or an interest in a business, or a
stock of goods, whether by gift or for consideration. Transfer
includes a change in the type of business entity or the name of
the business, where one business is discontinued and a new one
started. Transfer also includes the acquisition by a new
corporation of the assets of a prior business in exchange for
the stock of the new corporation. Transfer does not include an
assignment for the benefit of creditors, foreclosure or
enforcement of a mortgage, assignment of rents, security
interest or lien, sale or disposition in a bankruptcy
proceeding, or sale or disposition by a receiver.
(h) "Transfer in bulk" means a transfer, other than in the
ordinary course of the transferor's trade or business, of more
than one-half of all the property of a business at all locations
combined, as measured by the value of the property at the time
of the transfer.
Sec. 7. Minnesota Statutes 1994, section 270.102,
subdivision 2, is amended to read:
Subd. 2. [BULK TRANSFERS; LIABILITY OF SUCCESSOR; LIEN.]
(a) Whenever a business transfers in bulk to a successor all or
any part of the business assets, other than in the ordinary
course of business, and a an enforceable lien for unpaid sales
and withholding taxes has been filed against the business by the
commissioner under section 270.69 in the office of the secretary
of state or in the office of the county recorder for the county
in which the business is located, at least 20 days before taking
possession of the assets or paying the purchase price, the
successor shall notify the commissioner of the transfer and the
terms and conditions related to it. The notice must include the
tax identification number of the transferring business. If an
agreement to transfer has been entered into, this notice
requirement only applies: (1) if a lien described under this
paragraph has been filed prior to the date of the agreement; or
(2) if the date of the transfer is more than 30 days after the
date of the agreement, and a lien described under this paragraph
is filed at least 30 days prior to the date of transfer.
(b) If the successor fails to give the notice required in
paragraph (a), the successor is liable for any unpaid sales and
withholding taxes, interest, and penalties due from the
transferring business to the extent of the purchase price. If
the successor provides the notice required in paragraph (a) and,
within 20 days after receipt of the notice, the commissioner
notifies the successor that tax liabilities exist in addition to
those included on the lien or there are sales and withholding
tax returns due but not filed, the successor is, in addition to
being liable for the amounts included on the lien, liable for
all other uncontested sales and withholding taxes, interest, and
penalties as stated in the commissioner's notice from the
transferring business to the extent of the purchase price if the
successor pays the purchase price or takes possession of the
assets without withholding and remitting the liability to the
commissioner. The successor is liable whether the purchase
price is paid or the assets are transferred prior to or after
notification from the commissioner. The commissioner may also
notify the successor that there are no sales or withholding tax
liabilities or returns due from the transferring business other
than the liabilities included on the lien, and of the current
balance due to satisfy the lien.
(c) The commissioner shall have a first priority lien for
all consideration paid or to be paid toward the purchase price
when the requirements of this section have not been met.
(d) If, based upon the information available, the
commissioner determines that a transfer was not at arm's length
or was a gift, the successor's liability under this section
equals the value of the assets transferred. For purposes of
imposing the liability, the value of the property transferred is
presumed, subject to rebuttal, to equal the unpaid sales and
withholding taxes, interest, and penalties of the transferring
business.
(e) (d) In the case of a gift resulting in successor
liability under this section, return of the gifted property by
the donee to the donor releases the donee's successor liability.
(f) The liability imposed by this section does not include
assignments for the benefit of creditors under chapter 577,
foreclosures of mortgages under chapters 580 to 582 or of
security interests arising under article 9 of the Uniform
Commercial Code, or sales by trustees in bankruptcy.
(g) (e) A successor who complies with the requirements of
paragraphs (a) and (b) is not liable for any assessments of
sales and withholding taxes of the transferring business made
after the commissioner provides notice to the successor under
paragraph (b), except for taxes assessed on returns filed to
comply with the notice. If the commissioner fails to provide
the notice and the 20-day period expires, the successor is not
liable for any sales and withholding taxes of the transferring
business other than those included on the lien.
Sec. 8. Minnesota Statutes 1994, section 270.102,
subdivision 3, is amended to read:
Subd. 3. [ASSESSMENT PROCEDURE; NO STAY ON COLLECTION
REMEDIES.] The commissioner may assess liability under this
section within the time prescribed for collecting the underlying
sales and withholding taxes, interest, and penalties. The
assessment is presumed to be valid, and the burden is upon the
successor to show it is incorrect or invalid. An order
assessing successor liability is reviewable administratively
under section 289A.65 and is appealable to tax court under
chapter 271. The commissioner may abate an assessment if the
successor's failure to give the notice required under this
section is due to reasonable cause. The procedural and appeal
provisions under section 270.07, subdivision 6, apply to
abatement requests under this subdivision. Collection remedies
available against the transferring business are available
against the successor from the date of assessment of successor
liability.
Sec. 9. Minnesota Statutes 1994, section 270.70,
subdivision 2, is amended to read:
Subd. 2. [NOTICE AND DEMAND; COLLECTION BY LEVY; JEOPARDY
COLLECTION.] (a) Before a levy is made, notice and demand for
payment of the amount due must be given to the person liable for
the payment or collection of the tax at least 30 days prior to
the levy. The notice required under this paragraph 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.
(b) Notwithstanding the stay of collection provisions in
sections 270.10, subdivision 5, and 289A.37, subdivision 1,
paragraph (b), and the notice provisions in paragraph (a), 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. If the tax is not paid, the commissioner
may proceed to collect by levy or by filing a lien under section
270.69.
Sec. 10. Minnesota Statutes 1994, section 270A.03,
subdivision 2, is amended to read:
Subd. 2. [CLAIMANT AGENCY.] "Claimant agency" means any
state agency, as defined by section 14.02, subdivision 2, the
regents of the University of Minnesota, any district court of
the state, any county, any statutory or home rule charter city
presenting a claim for a municipal hospital or a public library,
a hospital district, any public agency responsible for child
support enforcement, any public agency responsible for the
collection of court-ordered restitution, and any public agency
established by general or special law that is responsible for
the administration of a low-income housing program.
Sec. 11. Minnesota Statutes 1995 Supplement, section
270A.03, subdivision 7, is amended to read:
Subd. 7. [REFUND.] "Refund" means an individual income tax
refund or political contribution refund, pursuant to chapter
290, or a property tax credit or refund, pursuant to chapter
290A.
For purposes of this chapter, lottery prizes, as set forth
in section 349A.08, subdivision 8, shall be treated as refunds.
In the case of a joint property tax refund payable to
spouses under chapter 290A, the refund shall be considered as
belonging to each spouse in the proportion of the total refund
that equals each spouse's proportion of the total income
determined under section 290A.03, subdivision 3. In the case of
a joint income tax refund under chapter 289A, the refund shall
be considered as belonging to each spouse in the proportion of
the total refund that equals each spouse's proportion of the
total taxable income determined under section 290.01,
subdivision 29. The commissioner shall remit the entire refund
to the claimant agency, which shall, upon the request of the
spouse who does not owe the debt, determine the amount of the
refund belonging to that spouse and refund the amount to that
spouse.
Sec. 12. Minnesota Statutes 1994, section 297E.02,
subdivision 4, is amended to read:
Subd. 4. [PULL-TAB AND TIPBOARD TAX.] (a) A tax is imposed
on the sale of each deal of pull-tabs and tipboards sold by a
distributor. The rate of the tax is two percent of the ideal
gross of the pull-tab or tipboard deal. The sales tax imposed
by chapter 297A on the sale of the pull-tabs and tipboards by
the distributor is imposed on the retail sales price less the
tax imposed by this subdivision. The retail sale of pull-tabs
or tipboards by the organization is exempt from taxes imposed by
chapter 297A and is exempt from all local taxes and license fees
except a fee authorized under section 349.16, subdivision 8.
(b) The liability for the tax imposed by this section is
incurred when the pull-tabs and tipboards are delivered by the
distributor to the customer or to a common or contract carrier
for delivery to the customer, or when received by the customer's
authorized representative at the distributor's place of
business, regardless of the distributor's method of accounting
or the terms of the sale.
The tax imposed by this subdivision is imposed on all sales
of pull-tabs and tipboards, except the following:
(1) sales to the governing body of an Indian tribal
organization for use on an Indian reservation;
(2) sales to distributors licensed under the laws of
another state or of a province of Canada, as long as all
statutory and regulatory requirements are met in the other state
or province;
(3) sales of promotional tickets as defined in section
349.12; and
(4) pull-tabs and tipboards sold to an organization that
sells pull-tabs and tipboards under the exemption from licensing
in section 349.166, subdivision 2. A distributor shall require
an organization conducting exempt gambling to show proof of its
exempt status before making a tax-exempt sale of pull-tabs or
tipboards to the organization. A distributor shall identify, on
all reports submitted to the commissioner, all sales of
pull-tabs and tipboards that are exempt from tax under this
subdivision.
(c) A distributor having a liability of $120,000 or more
during a fiscal year ending June 30 must remit all liabilities
in the subsequent calendar year by a funds transfer as defined
in section 336.4A-104, paragraph (a). The funds transfer
payment date, as defined in section 336.4A-401, must be on or
before the date the tax is due. If the date the tax is due is
not a funds transfer business day, as defined in section
336.4A-105, paragraph (a), clause (4), the payment date must be
on or before the funds transfer business day next following the
date the tax is due.
(d) Any customer who purchases deals of pull-tabs or
tipboards from a distributor may file an annual claim for a
refund or credit of taxes paid pursuant to this subdivision for
unsold pull-tab and tipboard tickets. The claim must be filed
with the commissioner on a form prescribed by the commissioner
by March 20 of the year following the calendar year for which
the refund is claimed. The refund must be filed as part of the
customer's February monthly return. The refund or credit is
equal to two percent of the face value of the unsold pull-tab or
tipboard tickets. The refund claimed will be applied as a
credit against tax owing under this chapter on the February
monthly return. If the refund claimed exceeds the tax owing on
the February monthly return, that amount will be refunded. The
amount refunded will bear interest pursuant to section 270.76
from 90 days after the claim is filed.
Sec. 13. Minnesota Statutes 1994, section 297E.02,
subdivision 10, is amended to read:
Subd. 10. [REFUNDS; APPROPRIATION.] A person who has,
under this chapter, paid to the commissioner an amount of tax
for a period in excess of the amount legally due for that
period, may file with the commissioner a claim for a refund of
the excess. The amount necessary to pay the refunds under this
subdivision and subdivision 4, paragraph (d), is appropriated
from the general fund to the commissioner.
Sec. 14. Minnesota Statutes 1994, section 298.17, is
amended to read:
298.17 [OCCUPATION TAXES TO BE APPORTIONED.]
All occupation taxes paid by persons, copartnerships,
companies, joint stock companies, corporations, and
associations, however or for whatever purpose organized, engaged
in the business of mining or producing iron ore or other ores,
when collected shall be apportioned and distributed in
accordance with the Constitution of the state of Minnesota,
article X, section 3, in the manner following: 90 percent shall
be deposited in the state treasury and credited to the general
fund of which four-ninths shall be used for the support of
elementary and secondary schools; and ten percent of the
proceeds of the tax imposed by this section shall be deposited
in the state treasury and credited to the general fund for the
general support of the university. Of the moneys apportioned to
the general fund by this section there is annually appropriated
and credited to the iron range resources and rehabilitation
board account in the special revenue fund an amount equal to
that which would have been generated by a one 1.5 cent tax
imposed by section 298.24 on each taxable ton produced in the
preceding calendar year, to be expended for the purposes of
section 298.22. The money appropriated pursuant to this section
shall be used (1) to provide environmental development grants to
local governments located within any county in region 3 as
defined in governor's executive order number 60, issued on June
12, 1970, which does not contain a municipality qualifying
pursuant to section 273.134 or (2) to provide economic
development loans or grants to businesses located within any
such county, provided that the county board or an advisory group
appointed by the county board to provide recommendations on
economic development shall make recommendations to the iron
range resources and rehabilitation board regarding the loans.
Payment to the iron range resources and rehabilitation board
account shall be made by May 15 annually.
Of the money allocated to Koochiching county, one-third
must be paid to the small business development center/economic
development office currently located at the Rainy River
community college for its operations.
Sec. 15. Minnesota Statutes 1994, section 298.75,
subdivision 1, is amended to read:
Subdivision 1. [DEFINITIONS.] Except as may otherwise be
provided, the following words, when used in this section, shall
have the meanings herein ascribed to them.
(1) "Aggregate material" shall mean nonmetallic natural
mineral aggregate including, but not limited to sand, silica
sand, gravel, building stone, crushed rock, limestone, and
granite. Aggregate material shall not include dimension stone
and dimension granite.
(2) "Person" shall mean any individual, firm, partnership,
corporation, organization, trustee, association, or other entity.
(3) "Operator" shall mean any person engaged in the
business of removing aggregate material from the surface or
subsurface of the soil, for the purpose of sale, either directly
or indirectly, through the use of the aggregate material in a
marketable product or service.
(4) "Extraction site" shall mean a pit, quarry, or deposit
containing aggregate material and any contiguous property to the
pit, quarry, or deposit which is used by the operator for
stockpiling the aggregate material.
(5) "Importer" shall mean any person who buys aggregate
material produced from a county not listed in paragraph (6) or
another state and causes the aggregate material to be imported
into a county in this state which imposes a tax on aggregate
material.
(6) "County" shall mean the counties of Stearns, Benton,
Sherburne, Carver, Scott, Dakota, Le Sueur, Kittson, Marshall,
Pennington, Red Lake, Polk, Norman, Mahnomen, Clay,
Becker, Rock, Murray, Wilkin, Big Stone, Sibley, Hennepin,
Washington, Chisago, and Ramsey.
Sec. 16. Minnesota Statutes 1994, section 349.15, is
amended by adding a subdivision to read:
Subd. 3. [REFUNDS AND CREDITS.] For purposes of this
section "gross profit" does not include any refund or credit
received under section 297E.02, subdivision 4, paragraph (d).
Sec. 17. Minnesota Statutes 1994, section 349.154,
subdivision 2, is amended to read:
Subd. 2. [NET PROFIT REPORTS.] (a) Each licensed
organization must report monthly to the board on a form
prescribed by the board each expenditure and contribution of net
profits from lawful gambling. The reports must provide for each
expenditure or contribution:
(1) the name, address, and telephone number of the
recipient of the expenditure or contribution;
(2) the date the contribution was approved by the
organization;
(3) the date, amount, and check number of the expenditure
or contribution;
(4) a brief description of how the expenditure or
contribution meets one or more of the purposes in section
349.12, subdivision 25; and
(5) in the case of expenditures authorized under section
349.12, subdivision 25, paragraph (a), clause (7), whether the
expenditure is for a facility or activity that primarily
benefits male or female participants.
(b) The board shall make available to the commissioners of
revenue and public safety copies of reports received under this
subdivision and requested by them.
(c) The report required under this subdivision must provide
for a separate accounting for all expenditures from the
reporting organization's tax refund and credit account.
Sec. 18. Minnesota Statutes 1994, section 349.19,
subdivision 2, is amended to read:
Subd. 2. [ACCOUNTS.] Gross receipts from lawful gambling
by each organization must be segregated from all other revenues
of the conducting organization and placed in a separate
account. All expenditures for expenses, taxes, and lawful
purposes must be made from the separate account except (1) in
the case of expenditures previously approved by the
organization's membership for emergencies as defined by board
rule, or (2) as provided in subdivision 2a. The name and
address of the bank, the account number for the separate
account, and the names of organization members authorized as
signatories on the separate account must be provided to the
board when the application is submitted. Changes in the
information must be submitted to the board at least ten days
before the change is made. Gambling receipts must be deposited
into the gambling bank account within four business days of
completion of the bingo occasion, deal, or game from which they
are received. A deal of pull-tabs is considered complete when
either the last pull-tab of the deal is sold or the organization
does not continue the play of the deal during the next scheduled
period of time in which the organization will conduct
pull-tabs. A tipboard game is considered complete when the seal
on the game flare is uncovered. Deposit records must be
sufficient to allow determination of deposits made from each
bingo occasion, deal, or game at each permitted premises. The
person who accounts for gambling gross receipts and profits may
not be the same person who accounts for other revenues of the
organization.
Sec. 19. Minnesota Statutes 1994, section 349.19, is
amended by adding a subdivision to read:
Subd. 2a. [TAX REFUND AND CREDIT ACCOUNT.] (a) Each
organization that receives a refund or credit under section
297E.02, subdivision 4, paragraph (d), must establish a separate
account designated as the tax and credit refund account. The
organization must (1) within four business days of receiving a
refund under that paragraph deposit the refund in the account,
and (2) within four business days of filing a tax return that
claims a credit under that paragraph, transfer from the separate
account established under subdivision 2 to the tax refund and
credit account an amount equal to the tax credit.
(b) The name and address of the bank, the account number
for the tax refund and credit account, and the names of
organization members authorized as signatories on the account
must be provided to the board within 30 days of the date when
the organization establishes the account. Changes in the
information must be submitted to the board at least ten days
before the change is made.
(c) The organization may expend money in the account only
for lawful purposes, other than lawful purposes described in
section 349.012, subdivision 25, paragraph (a), clauses (8),
(9), and (12). Amounts in the account must be spent for
qualifying lawful purposes no later than one year after the
refund is deposited.
Sec. 20. Minnesota Statutes 1995 Supplement, section
473.39, subdivision 1b, is amended to read:
Subd. 1b. [OBLIGATIONS.] The council may also issue
certificates of indebtedness, bonds, or other obligations under
this section in an amount not exceeding $62,000,000, of which
$44,000,000 may be used for council transit for and paratransit
fleet replacement, transit and paratransit facilities, and
transit and paratransit capital equipment, and $18,000,000 may
be used for transit hubs, park-and-ride lots, community-based
transit vehicles and replacement service program vehicles,
intelligent vehicle highway systems projects, and other capital
expenditures as prescribed in the council's transit capital
improvement program, and related costs including the cost of
issuance and sale of the obligations. For the purposes of this
subdivision, uniforms are not capital expenditures.
Sec. 21. Minnesota Statutes 1994, section 473.39, is
amended by adding a subdivision to read:
Subd. 1c. [OBLIGATIONS; 1996-1998.] In addition to the
authority in subdivisions 1a and 1b, the council may issue
certificates of indebtedness, bonds, or other obligations under
this section in an amount not exceeding $20,500,000 which may be
used for capital expenditures as prescribed in the council's
transit capital improvement program and for related costs,
including the costs of issuance and sale of the obligations.
Sec. 22. Minnesota Statutes 1995 Supplement, section
501B.38, subdivision 1a, is amended to read:
Subd. 1a. [EXTENSIONS.] The information required by this
section must be filed annually on or before the 15th day of the
fifth month following the close of the charitable trust's
taxable year as established for federal tax purposes. The time
for filing may be extended by application to the attorney
general, but no extension may be for more than three for up to
six months, provided the applicant has requested an extension to
file its federal tax return under section 6081 of the Internal
Revenue Code of 1986. A charitable trust that files the
information required under this subdivision with the attorney
general is not required to file the same information with the
commissioner of revenue.
Sec. 23. [REPEAL OF TEMPORARY TAX ON FACILITY ADMISSIONS.]
Subdivision 1. [REPEAL.] Laws 1987, chapter 285, is
repealed.
Subd. 2. [EFFECTIVE DATE.] Subdivision 1 is effective,
without local approval, the day after its final enactment.
Sec. 24. [APPLICABILITY.]
Sections 20 and 21 apply in the counties of Anoka, Carver,
Dakota, Hennepin, Ramsey, Scott, and Washington.
Sec. 25. [EFFECTIVE DATE.]
Sections 1, 9, 20, and 21 are effective the day following
final enactment.
Sections 6 to 8 are effective for business transfers,
acquisitions, successions, or dissolutions on or after January
1, 1995.
Section 10 is effective for refunds payable after July 31,
1996.
Section 11 is effective for refunds remitted to claimant
agencies on or after the day following final enactment.
Section 12 is effective for pull-tab and tipboard deals
reported as being played on or after July 1, 1996.
Section 15 is effective for Rock county the day after
compliance by Rock county with the requirements of Minnesota
Statutes, section 645.021, subdivision 3. Section 15 is
effective for Chisago county the day after compliance by Chisago
county with the requirements of Minnesota Statutes, section
645.021, subdivision 3. Section 15 is effective for Murray
county the day after compliance by Murray county with the
requirements of Minnesota Statutes, section 645.021, subdivision
3.
Presented to the governor April 4, 1996
Signed by the governor April 12, 1996, 9:58 a.m.
Official Publication of the State of Minnesota
Revisor of Statutes