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Minnesota Legislature

Office of the Revisor of Statutes

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

                              CHAPTER 2-H.F.No. 1 
                  An act relating to flood relief; appropriating money; 
                  authorizing the sale of state bonds; providing for 
                  temporary waivers of certain programs and other 
                  relief; canceling certain appropriations; amending 
                  Minnesota Statutes 1996, sections 41B.04, by adding a 
                  subdivision; 41B.043, by adding a subdivision; 
                  103F.105; 268.073, subdivisions 1 and 3; 273.124, 
                  subdivision 14; and 462A.202, subdivision 7, and by 
                  adding a subdivision; Laws 1997, chapter 105, section 
                  3; Laws 1997, chapter 202, article 1, section 35, as 
                  amended; repealing Minnesota Statutes 1996, sections 
                  103F.141, subdivision 2; and Laws 1997, chapter 203, 
                  article 3, section 16. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
        Section 1.  [APPROPRIATIONS.] 
           The sums in the column under "APPROPRIATIONS" are 
        appropriated from the bond proceeds fund to be spent to acquire 
        and to better publicly owned land and buildings and other public 
        improvements of a capital nature, and from other named funds for 
        flood relief and mitigation projects, as specified in this act, 
        in the area designated under Presidential Declaration of Major 
        Disaster, DR-1175.  The appropriations from the bond proceeds 
        fund are available until expended.  The appropriations from the 
        other named funds are available until June 30, 1999, unless 
        otherwise specified. 
                                    SUMMARY 
        PUBLIC SAFETY                                    $   30,000,000
        NATURAL RESOURCES                                    13,900,000
        HOUSING FINANCE AGENCY                                8,500,000
        PUBLIC FACILITIES AUTHORITY                           9,000,000
        TRADE AND ECONOMIC DEVELOPMENT                        8,200,000
        AGRICULTURE                                           1,250,000
        STRATEGIC AND LONG-RANGE PLANNING                       100,000
        REVENUE                                                 600,000
        BOND SALES EXPENSES                                      55,000
        ADDITIONAL GENERAL FUND DEBT SERVICE TRANSFER         5,000,000
        GENERAL FUND APPROPRIATION REDUCTION                (20,300,000)
        TOTAL                                            $   56,305,000
        BOND PROCEEDS FUND                                   55,305,000
        PETROLEUM TANK RELEASE CLEANUP FUND                   1,000,000
                                                         APPROPRIATIONS 
                                                         $
        Sec. 2.  PUBLIC SAFETY                               30,000,000 
        This appropriation is to the 
        commissioner of public safety for the 
        state and local match of public 
        disaster assistance funds under 
        Minnesota Statutes, section 12.221.  
        This appropriation is available to fund 
        100 percent of the state and local 
        match obligations required for publicly 
        owned capital improvement projects 
        incurred through the receipt of federal 
        public assistance for damages reported. 
        Sec. 3.  NATURAL RESOURCES                           13,900,000
        Subdivision 1.  To the commissioner 
        of natural resources for the purposes 
        specified in this section.  For the
        purposes of this appropriation, the
        commissioner may waive the grant limit 
        of $75,000 in Minnesota Statutes,
        section 103F.161.
        Subd. 2.  Flood Hazard Mitigation Grants              5,000,000
        For the flood hazard mitigation grant 
        program to local government units for 
        publicly owned capital improvements to 
        prevent or alleviate flood damages 
        under Minnesota Statutes, section 
        103F.161, and for the nonfederal 
        portion of federal hazard mitigation 
        grant program projects. 
        Subd. 3.  Flood Proofing Grants
        to Local Governments                                  5,000,000
        For flood proofing projects for 
        publicly owned buildings and facilities 
        under Minnesota Statutes, section 
        103F.161.  
        Subd. 4.  Flood Protection                            3,000,000
        To fund public flood protection and 
        reduction measures under Minnesota 
        Statutes, section 103F.161, including 
        ring dikes, levee repair and 
        rehabilitation, and engineering for 
        permanent projects. 
        Subd. 5.  Flood Damage Reduction Projects               900,000
        This is a one-time appropriation from 
        the general fund to fund flood damage 
        reduction projects under Minnesota 
        Statutes, section 103F.161, including 
        the construction of ring dikes.  
        Sec. 4.  HOUSING FINANCE                              8,500,000
        Subdivision 1.  For transfer to the 
        housing development fund for the 
        programs specified in this section. 
        Subd. 2.  Affordable Rental
        Investment Fund                                       2,000,000
        This is a one-time appropriation from 
        the general fund for the affordable 
        rental investment fund under Minnesota 
        Statutes, section 462A.21, subdivision 
        8b, to be used for rental housing.  
        Notwithstanding Minnesota Statutes, 
        section 462A.21, subdivision 8b, 
        assistance provided from this 
        appropriation for the rehabilitation of 
        existing rental housing may be in the 
        form of forgivable loans.  In making 
        forgivable loans from this 
        appropriation, the agency shall 
        determine the circumstances, terms, and 
        conditions under which all or any 
        portion of the grant shall be repaid.  
        This appropriation is available until 
        expended. 
        Subd. 3.  Community Rehabilitation
        Fund Program                                          4,500,000
        This is a one-time appropriation from 
        the general fund for the community 
        rehabilitation fund program under 
        Minnesota Statutes, section 462A.206.  
        Of this amount, up to $500,000 is 
        available for grants for damages 
        occurring after June 10, 1997, in an 
        area designated under a presidential 
        declaration of major disaster.  This 
        appropriation is available until 
        expended. 
        Subd. 4.  Rental Housing Loans                        2,000,000
        This appropriation is for the purpose 
        of making loans for publicly owned 
        permanent rental housing to local units 
        of government under Minnesota Statutes, 
        section 462A.202, subdivision 3a. 
        Sec. 5.  PUBLIC FACILITIES AUTHORITY                  9,000,000
        Subdivision 1.  To the public 
        facilities authority for the purposes 
        specified in this section. 
        Subd. 2.  New Housing                                   5,000,000
        Notwithstanding criteria or limitations 
        in Minnesota Statutes, sections 
        446A.07, 446A.072, and 446A.081, for 
        grants to local units of government for 
        publicly owned storm sewer, wastewater, 
        municipal utility service, and drinking 
        water infrastructure needs for new 
        housing construction.  
        Subd. 3.  Repair and Replacement                        4,000,000
        Notwithstanding criteria or limitations 
        in Minnesota Statutes, sections 
        446A.07, 446A.072, and 446A.081, for 
        grants to local units of government to 
        assist with the cost of repair and 
        replacement of publicly owned storm 
        sewer, wastewater, municipal utility 
        service, and drinking water systems as 
        well as streets and bridges. 
        Sec. 6.  TRADE AND ECONOMIC
        DEVELOPMENT                                             8,200,000
        Notwithstanding the requirement in 
        Minnesota Statutes, section 469.169, 
        subdivision 11, as added by Laws 1997, 
        chapter 231, article 16, section 20, to 
        base allocations to zones in cities on 
        the state's western border on a per 
        capita basis, $1,200,000 is a one-time 
        appropriation from the general fund to 
        the commissioner of trade and economic 
        development for border city enterprise 
        competitiveness grants under Minnesota 
        Statutes, sections 469.166 to 469.173.  
        Funds shall be allocated to communities 
        with significant business losses that 
        are at risk of losing business tax base 
        due to noncompetitiveness with North 
        Dakota and South Dakota and shall be 
        available to communities for locally 
        administered measures to retain their 
        job base.  Allocations made under this 
        paragraph may be used for tax 
        reductions as provided in Minnesota 
        Statutes, 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 
        Minnesota Statutes, section 469.169, 
        subdivision 7, do not apply to this 
        appropriation.  Enterprise zones that 
        receive allocations under this 
        paragraph may continue in effect for 
        purposes of those allocations through 
        December 31, 1998.  
        $6,000,000 is a one-time appropriation 
        from the general fund to the Minnesota 
        investment fund for grants to local 
        units of government for locally 
        administered operating loan programs 
        for businesses directly and adversely 
        affected by the floods.  Loan criteria 
        and requirements shall be locally 
        established with approval by the 
        department.  For the purposes of this 
        appropriation, Minnesota Statutes, 
        sections 116J.8731, subdivisions 3, 4, 
        5, and 7, and 116J.991, are waived.  
        Businesses that receive grants or loans 
        from this appropriation shall set goals 
        for jobs retained and wages paid within 
        the area designated under Presidential 
        Declaration of Major Disaster, DR-1175. 
        $1,000,000 is a one-time appropriation 
        from the petroleum tank release cleanup 
        fund to the commissioner of trade and 
        economic development.  Notwithstanding 
        Minnesota Statutes, section 115C.08, 
        subdivision 4, as amended by Laws 1997, 
        chapter 200, article 2, section 4, 
        these funds are to be used for grants 
        to buy out property substantially 
        damaged by a petroleum tank release.  
        Sec. 7.  AGRICULTURE                                  1,250,000
        To the rural finance authority for 
        department of agriculture loans under 
        Minnesota Statutes, chapter 41B, to 
        farmers for capital repairs to 
        agriculture buildings and farm 
        driveways, drainage ditches, and 
        grassed waterways. 
        Sec. 8.  STRATEGIC AND LONG-RANGE
        PLANNING                                                100,000
        This is a one-time appropriation from 
        the general fund to develop an 
        application for federal empowerment 
        zone and enterprise credits for local 
        communities and not-for-profit 
        organizations. 
        Sec. 9.  REVENUE                                        600,000
        (a) This is a one-time appropriation 
        from the general fund to provide 
        assistance to local governments 
        experiencing a significant loss in 
        property tax base and tax revenues due 
        to the 1997 flood and having difficulty 
        in meeting existing debt service 
        obligations.  The appropriation is to 
        be used for the purposes in paragraphs 
        (b) to (d). 
        (b) $20,000 is to reimburse local 
        governments for uncollected property 
        taxes designated for existing debt 
        service obligations in jurisdictions 
        where the flood-related market value 
        loss is at least three percent of the 
        jurisdiction's total taxable value.  
        (c) $230,000 is to pay the payable 1998 
        property taxes of properties located in 
        the counties of Big Stone, Chippewa, 
        Clay, Kittson, Lac qui Parle, Marshall, 
        Norman, Polk, Wilkin, and Yellow 
        Medicine that are purchased through 
        buy-out programs resulting from the 
        1997 floods between July 1, 1997, and 
        December 31, 1997.  Each jurisdiction 
        that holds title to these properties 
        shall notify the county auditor, and 
        the county auditor shall compile 
        information on net property taxes due 
        on these properties and submit the 
        information in the form of an 
        application to the commissioner of 
        revenue.  Based upon the information 
        received, the commissioner shall 
        determine the percentage of the tax 
        that will be reimbursed, if the amounts 
        applied for exceed the appropriation.  
        The commissioner shall make the full or 
        pro rata payments to the county, which 
        shall apportion the payments in the 
        same manner as the taxes due.  The 
        remaining payable 1998 tax on each 
        property receiving reimbursement under 
        this paragraph, if any, is abated. 
        (d) $350,000 is to be apportioned by 
        the commissioner of revenue among the 
        counties of Big Stone, Chippewa, Clay, 
        Kittson, Lac qui Parle, Marshall, 
        Norman, Polk, Wilkin, and Yellow 
        Medicine to provide reimbursement for 
        abatements granted for taxes payable in 
        1998 to properties damaged in the 1997 
        floods that are not described in 
        paragraph (c).  The apportionment shall 
        be based upon the amount of 
        flood-related market value loss in each 
        county.  Priority shall be given to 
        properties that are not eligible for 
        disaster credit under Minnesota 
        Statutes, section 273.123, subdivisions 
        1 to 6.  Counties shall be reimbursed 
        only for property taxes that are 
        actually abated, not to exceed each 
        county's apportioned amount.  
        Sec. 10.  CHILDREN, FAMILIES, AND
        LEARNING 
        The commissioner of children, families, 
        and learning may accelerate, by an 
        amount determined by the commissioner, 
        the state aid payment schedule under 
        Minnesota Statutes, section 124.195, 
        for special school district No. 1, 
        Minneapolis, to address damages 
        incurred during the July 1997 floods.  
        The amount, as calculated by the 
        commissioner, shall be reduced by any 
        funds paid to the district from claims 
        from property and casualty insurers.  
        The total amount of state aid paid to 
        special school district No. 1, 
        Minneapolis, in fiscal year 1998 shall 
        not exceed the amount the district 
        would have received without the 
        waiver.  The school district shall also 
        cooperate with the city on a 
        presidential disaster declaration. 
        Sec. 11.  BOND SALE EXPENSES                              55,000
        To the commissioner of finance for bond 
        sale expenses under Minnesota Statutes, 
        section 16A.641, subdivision 8. 
           Sec. 12.  [BOND SALE AUTHORIZATIONS.] 
           To provide the money appropriated in this act from the bond 
        proceeds fund, the commissioner of finance, on request of the 
        governor, shall sell and issue bonds of the state in an amount 
        up to $55,305,000 in the manner, upon the terms, and with the 
        effect prescribed by Minnesota Statutes, sections 16A.631 to 
        16A.675, and by the Minnesota Constitution, article XI, sections 
        4 to 7.  
           Sec. 13.  [LEGISLATIVE INTENT FOR FUTURE BONDING.] 
           The intent of the governor and legislature is to reduce the 
        economic, social, and environmental impacts of severe flooding 
        by providing flood damage reduction grants for cost-effective 
        flood control projects.  To accomplish this purpose, federally 
        authorized flood control projects in the communities of 
        Marshall, Stillwater, Crookston, Warren, and East Grand Forks, 
        as well as flood control projects approved by the department of 
        natural resources in other communities, shall be given 
        consideration for funding in the 1998 capital improvements 
        budget bill.  
           Sec. 14.  [CANCELLATION OF APPROPRIATIONS.] 
           $19,700,000 of the $20,000,000 appropriation to the 
        commissioner of public safety in Laws 1997, chapter 105, section 
        7, as amended by Laws 1997, chapter 203, article 3, section 16, 
        is canceled and returned to the general fund. 
           $600,000 of the $1,000,000 appropriation to the 
        commissioner of finance in Laws 1997, chapter 105, section 6, is 
        canceled and returned to the general fund. 
           Sec. 15.  Minnesota Statutes 1996, section 41B.04, is 
        amended by adding a subdivision to read: 
           Subd. 3a.  [DEBT-TO-ASSET RATIO.] Notwithstanding Minnesota 
        Rules, part 1653.0031, and other law to the contrary, a person 
        who farms land located in a county that has been the subject of 
        a state or federal disaster declaration may participate in a 
        loan restructuring program under this section even if the person 
        has a debt-to-asset ratio under 50 percent.  The person must 
        apply to participate in the program within 18 months of the 
        disaster declaration. 
           Sec. 16.  Minnesota Statutes 1996, section 41B.043, is 
        amended by adding a subdivision to read: 
           Subd. 2a.  [SNOW OR FLOOD DAMAGE.] A prospective borrower 
        applying for a loan participation through an eligible lender may 
        refinance an existing debt in order to repair or replace farm 
        driveways, drainage ditches and tile lines, grassed waterways, 
        or agricultural buildings damaged due to snow or flooding. 
           Sec. 17.  Minnesota Statutes 1996, section 103F.105, is 
        amended to read: 
           103F.105 [FLOODPLAIN MANAGEMENT POLICY.] 
           (a) The legislature finds: 
           (1) a large portion of the state's land resources is 
        subject to recurrent flooding by overflow of streams and other 
        watercourses causing loss of life and property, disruption of 
        commerce and governmental services, unsanitary conditions, and 
        interruption of transportation and communications, all of which 
        are detrimental to the health, safety, welfare, and property of 
        the occupants of flooded lands and the people of this state; and 
           (2) the public interest necessitates sound land use 
        development as land is a limited and irreplaceable resource, and 
        the floodplains of this state are a land resource to be 
        developed in a manner which will result in minimum loss of life 
        and threat to health, and reduction of private and public 
        economic loss caused by flooding.  
           (b) It is the policy of this state to reduce flood damages 
        through floodplain management, stressing nonstructural measures 
        such as floodplain zoning and floodproofing, and flood warning 
        practices, and other indemnification programs that reduce public 
        liability and expense for flood damages.  
           (c) It is the policy of this state: 
           (1) not to prohibit but to guide development of the 
        floodplains consistent with legislative findings; 
           (2) to provide state coordination and assistance to local 
        governmental units in floodplain management; 
           (3) to encourage local governmental units to adopt, enforce 
        and administer sound floodplain management ordinances; and 
           (4) to provide the commissioner of natural resources with 
        authority necessary to carry out a floodplain management program 
        for the state and to coordinate federal, state, and local 
        floodplain management activities in this state; and 
           (5) to provide incentives for communities to participate in 
        the national flood insurance program and for citizens of 
        Minnesota to take actions such as purchasing and maintaining 
        flood insurance to reduce future flood damage to private 
        property.  
           Sec. 18.  Minnesota Statutes 1996, section 268.073, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [ADDITIONAL BENEFITS; WHEN AVAILABLE.] 
        Additional reemployment insurance benefits are authorized under 
        this section only if the commissioner determines that: 
           (1) an employer has reduced operations at a facility 
        employing 100 or more individuals for at least six months during 
        the preceding year resulting in the reduction of at least 50 
        percent of the employer's work force and the layoff of at least 
        50 employees at that facility, including reductions caused as a 
        result of a major natural disaster declared by the President; 
           (2) the employer has no expressed plan to resume operations 
        which would lead to the reemployment of those employees at any 
        time in the immediate future; and 
           (3) the unemployment rate for the county in which the 
        facility is located was ten percent during the month of the 
        reduction or any of the three months preceding or succeeding the 
        reduction. 
           Sec. 19.  Minnesota Statutes 1996, section 268.073, 
        subdivision 3, is amended to read: 
           Subd. 3.  [ELIGIBILITY CONDITIONS.] A claimant is eligible 
        to receive additional benefits under this section for any week 
        during the claimant's benefit year if the commissioner finds 
        that: 
           (1) the claimant's unemployment is the result of a 
        reduction in operations as provided under subdivision 1; 
           (2) the claimant is unemployed and meets the eligibility 
        requirements for the receipt of unemployment benefits under 
        section 268.08; 
           (3) the claimant is not subject to a disqualification for 
        benefits under section 268.09; for the purpose of this 
        subdivision, the disqualifying conditions set forth in section 
        268.09, and the requalifying requirements thereunder, apply to 
        the receipt of additional benefits under this section; 
           (4) the claimant has exhausted all rights to regular 
        benefits payable under section 268.07, is not entitled to 
        receive extended benefits under section 268.071, and is not 
        entitled to receive reemployment insurance benefits under any 
        other state or federal law for the week in which the claimant is 
        claiming additional benefits; 
           (5) the claimant has made a claim for additional benefits 
        with respect to any week the claimant is claiming benefits in 
        accordance with the regulations as the commissioner may 
        prescribe with respect to claims for regular benefits; and 
           (6) the claimant has worked at least 26 weeks during the 
        claimant's base period in employment a majority of the 
        claimant's wage credits were earned with an employer for whom 
        the commissioner has determined there was a reduction in 
        operations under subdivision 1. 
           Sec. 20.  Minnesota Statutes 1996, section 273.124, 
        subdivision 14, is amended to read: 
           Subd. 14.  [AGRICULTURAL HOMESTEADS; SPECIAL PROVISIONS.] 
        (a) Real estate of less than ten acres that is the homestead of 
        its owner must be classified as class 2a under section 273.13, 
        subdivision 23, paragraph (a), if:  
           (1) the parcel on which the house is located is contiguous 
        on at least two sides to (i) agricultural land, (ii) land owned 
        or administered by the United States Fish and Wildlife Service, 
        or (iii) land administered by the department of natural 
        resources on which in lieu taxes are paid under sections 477A.11 
        to 477A.14; 
           (2) its owner also owns a noncontiguous parcel of 
        agricultural land that is at least 20 acres; 
           (3) the noncontiguous land is located not farther than two 
        townships or cities, or a combination of townships or cities 
        from the homestead; and 
           (4) the agricultural use value of the noncontiguous land 
        and farm buildings is equal to at least 50 percent of the market 
        value of the house, garage, and one acre of land. 
           Homesteads initially classified as class 2a under the 
        provisions of this subdivision paragraph shall remain classified 
        as class 2a, irrespective of subsequent changes in the use of 
        adjoining properties, as long as the homestead remains under the 
        same ownership, the owner owns a noncontiguous parcel of 
        agricultural land that is at least 20 acres, and the 
        agricultural use value qualifies under clause (4). 
           (b) Except as provided in paragraph (d), noncontiguous land 
        shall be included as part of a homestead under section 273.13, 
        subdivision 23, paragraph (a), only if the homestead is 
        classified as class 2a and the detached land is located in the 
        same township or city, or not farther than two townships or 
        cities or combination thereof from the homestead.  
           (c) Agricultural land used for purposes of a homestead and 
        actively farmed by a person holding a vested remainder interest 
        in it must be classified as a homestead under section 273.13, 
        subdivision 23, paragraph (a).  If agricultural land is 
        classified class 2a, any other dwellings on the land used for 
        purposes of a homestead by persons holding vested remainder 
        interests who are actively engaged in farming the property, and 
        up to one acre of the land surrounding each homestead and 
        reasonably necessary for the use of the dwelling as a home, must 
        also be assessed class 2a. 
           (d) Agricultural land and buildings that were class 2a 
        homestead property under section 273.13, subdivision 23, 
        paragraph (a), for the 1997 assessment shall remain classified 
        as agricultural homesteads for subsequent assessments if:  
           (1) the property owner abandoned the homestead dwelling 
        located on the agricultural homestead as a result of the April 
        1997 floods; 
           (2) the property is located in the county of Polk, Clay, 
        Kittson, Marshall, Norman, or Wilkin; 
           (3) the agricultural land and buildings remain under the 
        same ownership for the current assessment year as existed for 
        the 1997 assessment year; 
           (4) the dwelling occupied by the owner is located in 
        Minnesota and is within 30 miles of one of the parcels of 
        agricultural land that is owned by the taxpayer; and 
           (5) the owner notifies the county assessor that the 
        relocation was due to the 1997 floods, and the owner furnishes 
        the assessor any information deemed necessary by the assessor in 
        verifying the change in homestead dwelling.  For taxes payable 
        in 1998, the owner must notify the assessor by December 1, 1997. 
           Sec. 21.  Minnesota Statutes 1996, section 462A.202, is 
        amended by adding a subdivision to read: 
           Subd. 3a.  [PERMANENT RENTAL HOUSING.] The agency may make 
        loans, with or without interest, to cities and counties to 
        finance the construction, acquisition, or rehabilitation of 
        affordable, permanent, publicly owned rental housing located in 
        the area designated under Presidential Declaration of Major 
        Disaster, DR-1175.  Loans made under this subdivision are 
        subject to the restrictions of subdivision 7. 
           Sec. 22.  Minnesota Statutes 1996, section 462A.202, 
        subdivision 7, is amended to read: 
           Subd. 7.  [RESTRICTIONS.] (a) Except as provided in 
        paragraphs (b), (c), (d), (e), and (f), the city must own the 
        property financed with a loan under this section and use the 
        property for the purposes specified in this section: 
           (1) the city may sell the property at its fair market value 
        provided it repays the lesser of the net proceeds of the sale or 
        the amount of the loan balance to the agency for deposit in the 
        local government unit housing account; or 
           (2) the city may use the property for a different purpose 
        provided that the city repays the amount of the original loan. 
           If the city owns and uses the property for the purposes 
        specified in this section for a 20-year period, the agency shall 
        forgive the loan. 
           (b) In cases where the property consists of land only, 
        including land on which buildings acquired with a loan under 
        this section are demolished by the city, the city may lease the 
        property for a term not to exceed 99 years to a nonprofit 
        organization to use for the purposes specified in this section. 
           (c) In cases where the property consists of land and 
        buildings, the city may do the following: 
           (1) demolish the buildings in whole or in part and use or 
        lease the property under paragraph (b); 
           (2) sell the buildings to a nonprofit organization to use 
        for the purposes specified in this section.  If sold, the city 
        must sell the buildings for fair market value and repay the 
        proceeds of the sale to the agency for deposit in the local 
        government unit housing account; 
           (3) lease the buildings to a nonprofit organization to use 
        for the purposes specified in this section.  If leased, except 
        as provided in paragraph (d), the annual rental must equal the 
        amount of the loan attributable to the cost of the buildings, 
        divided by the number of years of useful life of the buildings 
        as determined in accordance with generally accepted accounting 
        principles.  For purposes of determining the required rental, 
        the purchase price of land and buildings must be allocated 
        between them based on standard valuation procedures; or 
           (4) contract with a nonprofit organization to manage the 
        property. 
           (d) A city may lease a building to a nonprofit organization 
        for a nominal amount under the following conditions: 
           (1) the lease does not exceed ten years; 
           (2) the city must have the option to cancel the lease with 
        or without cause at the end of any three-year period; and 
           (3) the city must determine annually that the property is 
        being used for the purposes specified in this section and that 
        the terms of the lease, including any income limits for 
        residents, are being met. 
           (e) A city may sell single-family residential housing 
        directly to persons and families of low and moderate income. 
           (f) A city may lease the buildings to a partnership 
        consisting of a nonprofit organization and a limited partner if 
        the nonprofit organization is the general partner and the 
        financing for the land trust project includes low-income housing 
        tax credits.  All conditions for leasing buildings to a 
        nonprofit organization as provided under this subdivision apply 
        to the lease authorized under this paragraph. 
           (g) The statutory lien created under section 16A.695 may be 
        subordinate to liens created by other sources of financing, at 
        the discretion of the agency. 
           Sec. 23.  Laws 1997, chapter 105, section 3, is amended to 
        read: 
           Sec. 3.  [TEMPORARY WAIVER OF FEES, ASSESSMENTS, OR TAXES.] 
           Subdivision 1.  [FEES.] Notwithstanding any law to the 
        contrary, for fiscal years 1997 and 1998, an agency, with the 
        approval of the governor, may waive fees that would otherwise be 
        charged for agency services.  The waiver of fees must be 
        confined to geographic areas affected by flooding within 
        counties included in a federal disaster declaration and to the 
        minimum periods of times necessary to deal with the emergency 
        situation.  The agency must promptly report the reasons for and 
        the impact of any suspended fees to the chairs of the 
        legislative committees that oversee the policy and budgetary 
        affairs of the agency.  This section subdivision expires 
        February 1, 1998. 
           Subd. 2.  [SOLID WASTE GENERATOR ASSESSMENTS AND SOLID 
        WASTE MANAGEMENT TAXES.] Notwithstanding any law to the 
        contrary, the waiver authority provided in subdivision 1 is also 
        extended to the commissioner of revenue in relation to the solid 
        waste generator assessment under Minnesota Statutes, section 
        116.07, subdivision 10, and the solid waste management taxes 
        under Laws 1997, chapter 231, article 13, for construction 
        debris generated from repair and demolition activities in the 
        area designated under Presidential Declaration of Major 
        Disaster, DR-1175, and disposed of in a waste management 
        facility designated by the commissioner of the pollution control 
        agency.  The commissioner of revenue's authority under this 
        subdivision to waive the assessment and tax expires for waste 
        transported to the designated facilities after December 31, 
        1997, including waste transported to a landfill that is limited 
        by permit exclusively to the disposal of flood debris.  The 
        waiver authority granted to the commissioner of revenue is 
        retroactive to April 1, 1997. 
           Sec. 24.  Laws 1997, chapter 202, article 1, section 35, as 
        amended by Laws 1997, chapter 246, section 34, is amended to 
        read:  
        Sec. 35.  BOND SALE SCHEDULE 
        The commissioner of finance shall 
        schedule the sale of state general 
        obligation bonds so that, during the 
        biennium ending June 30, 1999, no more 
        than $560,457,000 $565,457,000 will 
        need to be transferred from the general 
        fund to the state bond fund to pay 
        principal and interest due and to 
        become due on outstanding state general 
        obligation bonds.  During the biennium, 
        before each sale of state general 
        obligation bonds, the commissioner of 
        finance shall calculate the amount of 
        debt service payments needed on bonds 
        previously issued and shall estimate 
        the amount of debt service payments 
        that will be needed on the bonds 
        scheduled to be sold, the commissioner 
        shall adjust the amount of bonds 
        scheduled to be sold so as to remain 
        within the limit set by this section.  
        The amount needed to make the debt 
        service payments is appropriated from 
        the general fund as provided in 
        Minnesota Statutes, section 16A.641.  
           Sec. 25.  [COMMISSIONER OF HOUSING FINANCE; USE OF 
        APPROPRIATION.] 
           The appropriation in Laws 1997, chapter 200, article 1, 
        section 6, of $8,118,000 the first year and $6,493,000 the 
        second year for the affordable rental investment fund may be 
        used for forgivable loans for the rehabilitation of existing 
        rental housing located in the area designated under Presidential 
        Declaration of Major Disaster, DR-1175, notwithstanding 
        Minnesota Statutes, section 462A.21, subdivision 8b.  In making 
        forgivable loans from this appropriation, the agency shall 
        determine the circumstances, terms, and conditions under which 
        all or any portion of the grant shall be repaid. 
           Sec. 26.  [ICF/MR OPERATING COSTS.] 
           Notwithstanding any law to the contrary, for a provider 
        group that includes seven ICFs/MR with a total of 54 licensed 
        beds and was affected significantly by the severe conditions of 
        the winter and spring of 1996-1997, the operating cost payment 
        rate for each of its six facilities located in Polk and Norman 
        counties for the rate year beginning October 1, 1997, shall be 
        the operating cost payment rate in effect for each facility on 
        September 30, 1997. 
           Sec. 27.  [TRANSFER.] 
           Of the savings generated through the implementation of Laws 
        1997, chapter 203, article 12, section 18, $43,700 is 
        transferred to the medical assistance account for the purposes 
        of section 26. 
           Sec. 28.  [CASH FLOW ASSISTANCE.] 
           Local jurisdictions in the counties of Big Stone, Chippewa, 
        Clay, Kittson, Lac qui Parle, Marshall, Norman, Polk, Wilkin, 
        and Yellow Medicine may apply to the commissioner of revenue for 
        accelerated payment of 1998 local government aid under Minnesota 
        Statutes, section 477A.013, or homestead and agricultural credit 
        aid under Minnesota Statutes, section 273.1398, subdivision 2, 
        if necessary for meeting the jurisdiction's cash flow needs.  If 
        the request is granted by the commissioner, the payment 
        regularly scheduled to be made on December 26, 1998, shall be 
        made on March 15, 1998. 
           Sec. 29.  [CITY OF CROOKSTON; FLOOD CONTROL DISTRICT.] 
           Subdivision 1.  [AUTHORIZATION.] The city of Crookston may, 
        by ordinance approved by at least a four-fifths vote of all 
        members of the council, establish a flood control district 
        including part or all of the incorporated area of the city.  If 
        the mayor has no vote or votes only in the case of a tie, the 
        mayor is not deemed to be a city council member for purposes of 
        determining a four-fifths majority vote.  Subject to the 
        approval of the commissioner of natural resources, the city may 
        undertake flood control improvements, including the acquisition 
        of properties within or adjacent to the flood plain, the 
        demolition or removal of structures or improvements within or 
        adjacent to the flood plain or where necessary to permit the 
        construction or extension of flood control works, and the 
        construction, reconstruction, extension, or maintenance of 
        levees, dikes, and other flood control works.  The commissioner 
        of natural resources shall approve or reject the proposed 
        improvements within 30 days of submission of the proposed 
        improvements.  If the proposed improvements are rejected, the 
        commissioner must give the reasons for the rejection to the city 
        in writing.  Failure of the commissioner to approve or reject 
        the proposed improvements within 30 days of their submission 
        shall be deemed to be an approval of the proposed improvements.  
        The costs of the flood control improvements may be paid for by 
        the city from the flood control fees or levies authorized in 
        subdivision 2, from special assessments or improvement bonds 
        issued under Minnesota Statutes, chapter 429, from federal or 
        state grants, from money appropriated by the city from other 
        sources, or from any combination of those sources. 
           Subd. 2.  [SPECIAL SERVICE DISTRICT.] The flood control 
        district authorized in subdivision 1 shall be a special service 
        district as provided in Minnesota Statutes, sections 428A.01 to 
        428A.101, except as otherwise provided in subdivision 1, and 
        with the following exceptions: 
           (1) the flood control district is exempt from the 
        provisions of Minnesota Statutes, section 428A.08; 
           (2) the special service charge provided under Minnesota 
        Statutes, sections 428A.02, subdivision 1, and 428A.05, shall be 
        imposed on all property located within the flood control 
        district and not limited to commercial, industrial, and public 
        utility property; and 
           (3) the charges under this section are limited to a maximum 
        of 20 years. 
           Subd. 3.  [LOCAL APPROVAL.] This section is effective the 
        day after compliance by the city of Crookston with Minnesota 
        Statutes, section 645.021, subdivision 3. 
           Sec. 30.  [FLOOD DAMAGED SCHOOL RECONSTRUCTION.] 
           In order to expedite school reconstruction of school 
        buildings destroyed by the floodwaters of 1997 that are located 
        within the boundaries of independent school district Nos. 595 
        and 2854, the school districts may enter into construction 
        contracts, including but not limited to design-build, that the 
        districts determine to be in their best interests.  Construction 
        of these educational facilities is emergency construction and 
        not subject to competitive bid requirements of Minnesota 
        Statutes, sections 123.37 and 471.345, or other law or charter 
        or the requirements of Minnesota Statutes, section 16B.335.  The 
        department of children, families, and learning shall notify the 
        chairs of the senate finance committees, the house ways and 
        means committee, and the house capital investment committee that 
        the projects have been approved under review and comment and 
        necessary contracts have been executed. 
           Sec. 31.  [SCHOOL FACILITY STORM DAMAGE RELATED 
        BETTERMENT.] 
           A district may make an additional levy for facility 
        betterment under this section.  To make this levy, a district 
        must: 
           (1) qualify under Minnesota Statutes, section 124.239, in 
        fiscal year 1998; and 
           (2) have had damage to an instructional facility in excess 
        of $1,000,000 related to storms during the summer of 1997. 
           The levy must be directly related to the costs of the 
        betterment of the damaged facility and may only be for costs not 
        otherwise paid for by insurance or other proceeds.  The total 
        costs related to the levy may not exceed two percent of a 
        district's 1995 adjusted net tax capacity.  The project must be 
        approved under Minnesota Statutes, section 121.15, and be a part 
        of the plan under Minnesota Statutes, section 124.239.  The 
        district may either bond for the costs under Minnesota Statutes, 
        section 124.239, subdivision 3, or levy under Minnesota 
        Statutes, section 124.239, subdivision 5.  The levy may be 
        spread over more than one year.  The levy is not eligible for 
        state-aid payments under Minnesota Statutes, section 124.239, 
        subdivision 3a or 5a, 124.83, or 124.95, or any other aid 
        program.  A district must consult with and receive approval from 
        the city in which its administrative offices are located prior 
        to making this levy. 
           Sec. 32.  [REPEALER.] 
           Minnesota Statutes 1996, section 103F.141, subdivision 2; 
        and Laws 1997, chapter 203, article 3, section 16, are repealed. 
           Sec. 33.  [EFFECTIVE DATE.] 
           Sections 1 to 19, 21, 22, and 24 to 32 are effective on the 
        day following final enactment.  Section 20 is effective for 
        taxes levied in 1997, payable in 1998, and thereafter.  Section 
        23 is effective retroactive to April 1, 1997. 
           Presented to the governor August 20, 1997 
           Signed by the governor August 22, 1997, 11:13 a.m.