Office of the Revisor of Statutes
Minnesota Session Laws - 2000, Regular Session
Key: (1) language to be deleted (2) new language
CHAPTER 477-H.F.No. 3312
An act relating to agriculture; changing the scope of
the value-added agricultural product processing and
marketing grant program; establishing a certification
pilot program; including bison in certain definitions
of livestock; changing meeting provisions and duties
of the board of grain standards; expanding a
grants-in-aid program; changing certain fees; making
technical changes to pesticide and fertilizer laws;
changing certain reimbursement payments; changing seed
testing provisions; providing for delegation of
certain duties; clarifying the scope of certain
regulation of wholesale produce dealers; updating
certain food standards; simplifying certain language;
providing for uniformity in meat and poultry
inspection; changing certain reporting requirements;
increasing the amount of livestock dealer bonds;
changing rural finance authority loan provisions;
clarifying status of certain grain buying
transactions; changing certain grain storage
provisions; changing the corporate and partnership
farming law; providing alternative seed potato
regulation in Clearwater county; amending Minnesota
Statutes 1998, sections 17.101, subdivision 5; 17A.03,
subdivision 5; 17A.05, subdivision 2; 17B.07; 17B.12;
18.023, subdivision 3a; 18C.005, subdivision 34, and
by adding subdivisions; 18C.201, by adding
subdivisions; 18C.215, subdivisions 1, 2, and by
adding a subdivision; 18C.411, subdivision 1; 18C.421,
subdivision 1; 18D.201, subdivision 3; 18D.331, by
adding a subdivision; 18E.04, subdivision 4; 21.86,
subdivision 1; 27.01, subdivision 8; 27.19,
subdivision 1; 31.101, as amended; 31.102, subdivision
1; 31.103, subdivision 1; 31.104; 31.632; 31.633,
subdivision 1; 31.651; 31A.02, subdivisions 5, 6, 10,
13, and 14; 31A.03; 31A.05; 31A.06; 31A.07,
subdivisions 1 and 2; 31A.08; 31A.10; 31A.13; 31A.16;
31A.17; 31B.02, subdivision 4; 41B.03, subdivisions 1
and 2; 41B.039, subdivision 2; 41B.04, subdivision 8;
41B.042, subdivision 4; 41B.043, subdivision 2;
41B.045, subdivision 2; 223.16, subdivision 5; 223.17,
subdivision 5; 223.175; 232.21, by adding a
subdivision; 232.23, subdivisions 1, 3, and 6; 500.24,
subdivisions 3a, 3b, 4, and 5; and 500.245,
subdivision 2; Minnesota Statutes 1999 Supplement,
sections 17B.15, subdivision 1; 28A.075; 31A.01;
31A.15, subdivision 1; 31B.07, subdivision 3; 500.24,
subdivisions 2 and 3; and 500.245, subdivision 1;
proposing coding for new law in Minnesota Statutes,
chapter 17.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1. Minnesota Statutes 1998, section 17.101,
subdivision 5, is amended to read:
Subd. 5. [VALUE-ADDED AGRICULTURAL PRODUCT PROCESSING AND
MARKETING GRANT PROGRAM.] (a) For purposes of this section:
(1) "agricultural commodity" means a material produced for
use in or as food, feed, seed, or fiber and includes crops for
fiber, food, oilseeds, seeds, livestock, livestock products,
dairy, dairy products, poultry, poultry products, and other
products or by-products of the farm produced for the same or
similar use, except ethanol; and
(2) "agricultural product processing facility" means land,
buildings, structures, fixtures, and improvements located or to
be located in Minnesota and used or operated primarily for the
processing or production of marketable products from
agricultural commodities produced in Minnesota.
(b) The commissioner shall establish and implement a
value-added agricultural product processing and marketing grant
program to help farmers finance new cooperatives that organize
for the purposes of operating agricultural product processing
facilities and for marketing activities related to the sale and
distribution of processed agricultural products.
(c) To be eligible for this program a grantee must:
(1) be a cooperative organized under chapter 308A;
(2) certify that all of the control and equity in the
cooperative is from farmers as defined in section 500.24,
subdivision 2, who are actively engaged in agricultural
commodity production;
(3) be operated primarily for the processing of
agricultural commodities produced in Minnesota;
(4) receive agricultural commodities produced primarily by
shareholders or members of the cooperative; and
(5) have no direct or indirect involvement in the
production of agricultural commodities.
(d) The commissioner may receive applications from and make
grants up to $50,000 for feasibility, marketing
analysis, assistance with organizational development, financing
and managing new cooperatives, product development, development
of business and marketing plans, and predesign of
facilities including site analysis, development of bid
specifications, preliminary blueprints and schematics, and
completion of purchase agreements and other necessary legal
documents to eligible cooperatives. The commissioner shall give
priority to applicants who use the grants for planning costs
related to an application for financial assistance from the
United States Department of Agriculture, Rural Business -
Cooperative Service.
Sec. 2. [17.1025] [MINNESOTA CERTIFICATION PROGRAM.]
In cooperation with the University of Minnesota, the
department of trade and economic development, and the board of
animal health, the commissioner shall establish a pilot program
to certify agricultural production methods and agricultural
products grown or processed within the state to assure the
integrity of claims made by participating businesses. The
commissioner may select and cooperate with private organizations
that have established procedures and safeguards to justify
claimed characteristics of the production process or the final
certified product to conduct certification activities for third
party producers.
The commissioner may establish guidelines for the
certification program, which are not subject to chapter 14. The
commissioner shall submit a report on the pilot program to the
legislature by February 1, 2001.
Sec. 3. Minnesota Statutes 1998, section 17A.03,
subdivision 5, is amended to read:
Subd. 5. [LIVESTOCK.] "Livestock" means cattle, sheep,
swine, horses intended for slaughter, mules, farmed cervidae, as
defined in section 17.451, subdivision 2, llamas, as defined in
section 17.455, subdivision 2, ratitae, as defined in section
17.453, subdivision 3, bison (buffalo), and goats.
Sec. 4. Minnesota Statutes 1998, section 17A.05,
subdivision 2, is amended to read:
Subd. 2. [LIVESTOCK DEALERS.] The amount of each livestock
dealer bond filed with the commissioner shall be not less
than $5,000 $10,000 or such larger amount as required, based on
the commissioner's consideration of the principal's financial
statement, the volume of business reported, or any other factor
the commissioner deems pertinent for the protection of the
public. Each such bond shall contain the condition clause
applicable when the principal buys on commission or as a
dealer. A livestock dealer's bond shall be executed on a form
furnished by the commissioner or in accordance with the Packers
and Stockyards Act, 1921, as amended, (United States Code, title
7, section 181 et seq.).
When a bond is executed on a state form furnished by the
commissioner, the bond shall be for the protection of both the
buyer and the seller named in the transaction when the principal
fails to pay when due for livestock purchased or sold for the
principal's own account or the account of others and shall be
limited to the protection of claimants whose residence or
principal place of livestock business is in the state of
Minnesota at the time of the transaction. If the bond is filed
on a form in accordance with the Packers and Stockyards Act, the
bond shall cover claimants regardless of place of residence.
Sec. 5. Minnesota Statutes 1998, section 17B.07, is
amended to read:
17B.07 [OFFICIAL TITLE OF BOARD; MEETINGS.]
The official title of the board shall be "The Minnesota
board of grain standards" and it shall have jurisdiction over
all grain appeal cases brought before it.
The board shall meet annually on or before June 15, as
needed and shall establish the grades of all grain subject to
state inspection which shall be known as the "Minnesota grades,"
and all grain received at any public warehouse shall be graded
accordingly. Such grades shall not be changed before the next
annual meeting without the concurrence of at least two members
of the board. At the time of establishing Minnesota grades, the
board also shall adopt such rules, in accordance with the
Administrative Procedure Act, as it deems necessary for the
enforcement of this section and section 17B.06. In establishing
the grades, in addition to the physical qualities of the grain,
there shall be taken into consideration the milling and
bread-producing quality of all grain products used as human
food. The board shall determine the grade, and dockage, if any,
of all grain in all cases where appeals from the decisions of
the chief inspector have been taken and for such purpose they
may request fresh samples of such grain to be furnished directly
to the board. Dockage shall be considered as being of two
classes; first, that having value and second, that having no
value. At the annual meeting the board shall ascertain and
determine what dockage contained in grain is of value and
publish a list thereof in connection with the publication of the
Minnesota grades. Any foreign content of the grain shall not be
considered in establishing the grade. Whenever grain containing
dockage of value is sold to any public local warehouse or mill,
terminal warehouse, or to any flour mill located in St. Paul,
Minneapolis, or Duluth, or any other point within the state,
which is now or may hereafter be designated as a terminal point,
such sale shall not be considered to include such dockage of
value, but such dockage shall be paid for at its market value or
shall be returned to the vendor of said grain at the option of
the vendee.
Sec. 6. Minnesota Statutes 1998, section 17B.12, is
amended to read:
17B.12 [APPEALS; PROCEDURE.]
Any owner, consignee, or shipper of grain, or any warehouse
operator, who is dissatisfied with the inspection of grain may
appeal to the board of grain standards by filing a notice of
such appeal with the commissioner and paying a fee, to be fixed
by the commissioner, which shall be refunded if the appeal is
sustained. The commissioner shall forthwith promptly transmit
the notice to said the board of grain standards. The decision
of said the board, fixing the grade of such the grains shall
be is final.
Sec. 7. Minnesota Statutes 1999 Supplement, section
17B.15, subdivision 1, is amended to read:
Subdivision 1. [ADMINISTRATION; APPROPRIATION.] The fees
for inspection and weighing shall be fixed by the commissioner
and be a lien upon the grain. The commissioner shall set fees
for all inspection and weighing in an amount adequate to pay the
expenses of carrying out and enforcing the purposes of sections
17B.01 to 17B.23, including the portion of general support costs
and statewide indirect costs of the agency attributable to that
function, with a reserve sufficient for up to six months. The
commissioner shall review the fee schedule twice each year. Fee
adjustments are not subject to chapter 14. Payment shall be
required for services rendered. If the grain is in transit, the
fees shall be paid by the carrier and treated as advance
charges, and, if received for storage, the fees shall be paid by
the warehouse operator, and added to the storage charges.
All fees collected and all fines and penalties for
violation of any provision of this chapter shall be deposited in
the grain inspection and weighing account, which is created in
the agricultural fund for carrying out the purpose of sections
17B.01 to 17B.23. The money in the account, including interest
earned on the account, is annually appropriated to the
commissioner of agriculture to administer the provisions of
sections 17B.01 to 17B.23. When money from any other account is
used to administer sections 17B.01 to 17B.23, the commissioner
shall notify the chairs of the agriculture, environment and
natural resources finance, and ways and means committees of the
house of representatives; the agriculture and rural development
and finance committees of the senate; and the finance division
of the environment and natural resources committee of the senate.
Sec. 8. Minnesota Statutes 1998, section 18.023,
subdivision 3a, is amended to read:
Subd. 3a. [GRANTS TO MUNICIPALITIES.] (a) The commissioner
may, in the name of the state and within the limit of
appropriations provided, make grants-in-aid to a municipality
with an approved disease control program for the partial funding
of municipal sanitation and reforestation programs to replace
trees lost to disease or natural disaster. The commissioner may
make grants-in-aid to any home rule charter or statutory city,
or any special purpose park and recreation board organized under
a charter of a city of the first class or any nonprofit
corporation serving a city of the first class or any county
having an approved disease control program for the acquisition
or implementation of a wood utilization or disposal system.
(b) The commissioner shall promulgate rules for the
administration of grants authorized by this subdivision. The
rules shall establish and contain as a minimum:
(1) Procedures for grant applications;
(2) Conditions and procedures for the administration of
grants;
(3) Criteria of eligibility for grants including, but not
limited to, those specified in this subdivision; and
(4) Other matters the commissioner may find necessary to
the proper administration of the grant program.
(c) Grants-in-aid payments for wood utilization and
disposal systems made by the commissioner pursuant to this
subdivision shall not exceed 50 percent of the total cost of the
system. Grants for sanitation and reforestation shall be
combined into one grant program. Grants to any municipality for
sanitation shall not exceed 50 percent of sanitation costs
approved by the commissioner including any amount of sanitation
costs paid by special assessments, ad valorem taxes, federal
grants or other funds. A municipality shall not specially
assess a property owner any amount greater than the amount of
the tree's sanitation cost minus the amount of the tree's
sanitation cost reimbursed by the commissioner. Grants to
municipalities for reforestation shall not exceed 50 percent of
the cost, but not more than $50 per tree, of trees planted
pursuant to the reforestation program; provided that a
reforestation grant to any county may include 90 percent of the
cost, but not more than $60 per tree, of the first 50 trees
planted on public property in a town not described in
subdivision 1 and of less than 1,000 population upon the town's
application to the county. Reforestation grants to towns and
home rule charter or statutory cities as described in
subdivision 1 of less than 4,000 population with an approved
disease control program may include 90 percent of the cost, but
not more than $60 per tree, of the first 50 trees planted on
public property with the approval of the 1979 application. The
governing body of any municipality which receives a
reforestation grant pursuant to this section shall appoint up to
seven residents of the municipality or designate an existing
municipal board or committee to serve as a reforestation
advisory committee to advise the governing body of the
municipality in the administration of the reforestation
program. For the purpose of this subdivision, "cost" shall not
include the value of a gift or dedication of trees required by a
municipal ordinance but shall include documented "in kind"
services or voluntary work for municipalities with a population
of less than 1,000 according to the most recent federal census.
(d) Based upon estimates submitted by the municipality to
the commissioner, which shall state the estimated costs of
sanitation and reforestation in the succeeding quarter under an
approved program, the commissioner shall direct quarterly
advance payments to be made by the state to the municipality
commencing April 1, 1979. The commissioner shall direct
adjustment of any overestimate in a succeeding quarter. A
municipality may elect to receive the proceeds of its sanitation
and reforestation grants on a periodic cost reimbursement basis.
(e) A home rule charter or statutory city, or county
outside the metropolitan area or any municipality, as defined in
subdivision 1, may submit an application for a grant authorized
by this subdivision concurrently with its request for approval
of a disease control program.
Sec. 9. Minnesota Statutes 1998, section 18C.005, is
amended by adding a subdivision to read:
Subd. 1a. [ANHYDROUS AMMONIA.] "Anhydrous ammonia" means a
compound formed by the chemical combination of the elements
nitrogen and hydrogen in the molar proportion of one part
nitrogen to three parts hydrogen. This relationship is shown by
the chemical formula, NH3 . On a weight basis, the ratio is 14
parts nitrogen to three parts hydrogen or approximately 82
percent nitrogen to 18 percent hydrogen. Anhydrous ammonia may
exist in either a gaseous or a liquid state.
Sec. 10. Minnesota Statutes 1998, section 18C.005, is
amended by adding a subdivision to read:
Subd. 7a. [CUSTOM BLEND FERTILIZER.] "Custom blend
fertilizer" means a fertilizer blended according to the
specifications that are furnished to a distributor by a consumer
prior to blending.
Sec. 11. Minnesota Statutes 1998, section 18C.005,
subdivision 34, is amended to read:
Subd. 34. [SPECIALTY FERTILIZER.] "Specialty fertilizer"
means a fertilizer labeled and distributed for, but not limited
to, the following uses: greenhouses, nurseries, home gardens,
house plants, lawn fertilizer that is not custom applied,
shrubs, golf courses, municipal parks, and cemeteries.
Sec. 12. Minnesota Statutes 1998, section 18C.005, is
amended by adding a subdivision to read:
Subd. 35a. [TAMPER.] "Tamper" means action taken by a
person not authorized to take that action by law or by the owner
or authorized custodian of an anhydrous ammonia container or of
equipment where anhydrous ammonia is used, stored, distributed,
or transported.
Sec. 13. Minnesota Statutes 1998, section 18C.201, is
amended by adding a subdivision to read:
Subd. 6. [ANHYDROUS AMMONIA.] (a) A person may not:
(1) place, have placed, or possess anhydrous ammonia in a
container that is not designed, constructed, maintained, and
authorized to contain or transport anhydrous ammonia;
(2) transport anhydrous ammonia in a container that is not
designed, constructed, maintained, and authorized to transport
anhydrous ammonia;
(3) use, deliver, receive, sell, or transport a container
designed and constructed to contain anhydrous ammonia without
the express consent of the owner or authorized custodian of the
container; or
(4) tamper with any equipment or facility used to contain,
store, or transport anhydrous ammonia.
(b) For the purposes of this subdivision, containers
designed and constructed for the storage and transport of
anhydrous ammonia are described in rules adopted under section
18C.121, subdivision 1, or in Code of Federal Regulations, title
49.
Sec. 14. Minnesota Statutes 1998, section 18C.201, is
amended by adding a subdivision to read:
Subd. 7. [NO CAUSE OF ACTION.] (a) Except as provided in
paragraph (b), a person tampering with anhydrous ammonia
containers or equipment under subdivision 6 shall have no cause
of action for damages arising out of the tampering against (1)
the owner or lawful custodian of the container or equipment; (2)
a person responsible for the installation or maintenance of the
container or equipment; or (3) a person lawfully selling or
offering for sale the anhydrous ammonia.
(b) Paragraph (a) does not apply to a cause of action
against a person who unlawfully obtained the anhydrous ammonia
or anhydrous ammonia container or who possesses the anhydrous
ammonia or anhydrous ammonia container for any unlawful purpose.
Sec. 15. Minnesota Statutes 1998, section 18C.215,
subdivision 1, is amended to read:
Subdivision 1. [PACKAGED FERTILIZERS.] (a) A person may
not sell or distribute specialty fertilizer in bags or other
containers in this state unless a label is placed on or affixed
to the bag or container stating in a clear, legible, and
conspicuous form the following information:
(1) the net weight;
(2) the brand and grade, except the grade is not required
if primary nutrients are not claimed;
(3) the guaranteed analysis;
(4) the name and address of the guarantor;
(5) directions for use, except directions for use are not
required for custom blend specialty fertilizers; and
(6) a derivatives statement.
(b) A person may not sell or distribute fertilizer for
agricultural purposes in bags or other containers in this state
unless a label is placed on or affixed to the bag or container
stating in a clear, legible, and conspicuous form the
information listed in paragraph (a), clauses (1) to (4), except:
(1) the grade is not required if primary nutrients are not
claimed; and
(2) the grade on the label is optional if the fertilizer is
used only for agricultural purposes and the guaranteed analysis
statement is shown in the complete form as in section 18C.211.
(c) The labeled information must appear:
(1) on the front or back side of the container;
(2) on the upper one-third of the side of the container;
(3) on the upper end of the container; or
(4) printed on a tag affixed to the upper end of the
container.
(d) If a person sells a custom blend specialty fertilizer
in bags or other containers, the information required in
paragraph (a) must either be affixed to the bag or container as
required in paragraph (c) or be furnished to the customer on an
invoice or delivery ticket in written or printed form.
Sec. 16. Minnesota Statutes 1998, section 18C.215,
subdivision 2, is amended to read:
Subd. 2. [BLENDED, MIXED, BULK, AND CUSTOM APPLIED
FERTILIZER.] (a) A distributor who blends or mixes fertilizer or
distributes fertilizer, for agricultural use, in bulk, must
furnish each purchaser with an invoice or delivery ticket in
written or printed form showing:
(1) the net weight and guaranteed analysis of each of the
materials used in the mixture and the name and address of the
guarantor; or
(2) the net weight and guaranteed analysis of the final
mixture and the name and address of the guarantor.
(b) A person may not custom apply specialty fertilizer in
this state unless a label, invoice, or delivery ticket is given
to each purchaser stating in a clear, legible, and conspicuous
form the following information:
(1) the net weight, which may be listed as the total net
weight applied or the net weight applied per unit treated;
(2) the guaranteed analysis;
(3) the name and address of the guarantor;
(4) the number of units treated in square feet, acres, or
another unit of measure; and
(5) a derivative statement.
(c) Copies of invoices or delivery tickets must be kept for
five years after the sale, delivery, or application.
Sec. 17. Minnesota Statutes 1998, section 18C.215, is
amended by adding a subdivision to read:
Subd. 2a. [INFORMATION TO CUSTOMER.] If a person sells a
custom blend specialty fertilizer in bulk, the information
required in subdivision 1, paragraph (a), must be furnished to
the customer on an invoice or delivery ticket in written or
printed form.
Sec. 18. Minnesota Statutes 1998, section 18C.411,
subdivision 1, is amended to read:
Subdivision 1. [REGISTRATION REQUIRED.] (a) A person may
not sell brands or grades of specialty fertilizers, soil
amendments, or plant amendments in this state unless they are
registered with the commissioner.
(b) Registration of the materials is not a warranty by the
commissioner or the state.
(c) Specialty fertilizers custom applied are exempt from
the registration requirements of this section.
(d) Custom blend specialty fertilizers are exempt from the
registration requirements of this section if the distributor is
licensed as required by section 18C.415 and the fertilizer is
labeled as required by section 18C.215.
Sec. 19. Minnesota Statutes 1998, section 18C.421,
subdivision 1, is amended to read:
Subdivision 1. [SEMIANNUAL STATEMENT.] (a) Each licensed
distributor of fertilizer and each registrant of a specialty
fertilizer, soil amendment, or plant amendment must file a
semiannual statement for the periods ending December 31 and June
30 with the commissioner on forms furnished by the commissioner
stating the number of net tons and grade of each raw fertilizer
material distributed or the number of net tons of each brand or
grade of fertilizer, soil amendment, or plant amendment
distributed in this state during the reporting period.
(b) Tonnage reports are not required to be filed with the
commissioner from licensees who distributed fertilizer solely by
custom application.
(c) A report from a licensee who sells to an ultimate
consumer must be accompanied by records or invoice copies
indicating the name of the distributor who paid the inspection
fee, the net tons received, and the grade or brand name of the
products received.
(c) (d) The report is due on or before the last day of the
month following the close of each reporting period of each
calendar year.
(d) (e) The inspection fee at the rate stated in section
18C.425, subdivision 6, must accompany the statement.
Sec. 20. Minnesota Statutes 1998, section 18D.201,
subdivision 3, is amended to read:
Subd. 3. [INSPECTION REQUESTS BY OTHERS.] (a) A person who
believes that a violation of this chapter has occurred may
request an inspection by giving notice to the commissioner of
the violation. The notice must be in writing, state with
reasonable particularity the grounds for the notice, and be
signed by the person making the request. If the pesticide
application is alleged to have damaged a crop or vegetation, the
request for inspection must be submitted within 45 days of the
date of the pesticide application.
(b) If after receiving a notice of violation the
commissioner reasonably believes that a violation has occurred,
the commissioner shall make a special inspection in accordance
with the provisions of this section as soon as practicable, to
determine if a violation has occurred.
(c) An inspection conducted pursuant to a notice under this
subdivision may cover an entire site and is not limited to the
portion of the site specified in the notice. If the
commissioner determines that reasonable grounds to believe that
a violation occurred do not exist, the commissioner must notify
the person making the request in writing of the determination.
Sec. 21. Minnesota Statutes 1998, section 18D.331, is
amended by adding a subdivision to read:
Subd. 5. [ANHYDROUS AMMONIA CONTAINMENT, TAMPERING, THEFT,
TRANSPORT.] A person who knowingly violates section 18C.201,
subdivision 6, is guilty of a felony and may be sentenced to
imprisonment for not more than five years, or to payment of a
fine of not more than $50,000, or both.
Sec. 22. Minnesota Statutes 1998, section 18E.04,
subdivision 4, is amended to read:
Subd. 4. [REIMBURSEMENT PAYMENTS.] (a) The board shall pay
a person that is eligible for reimbursement or payment under
subdivisions 1, 2, and 3 from the agricultural chemical response
and reimbursement account for:
(1) 90 percent of the total reasonable and necessary
corrective action costs greater than $1,000 and less than or
equal to $100,000; and
(2) 100 percent of the total reasonable and necessary
corrective action costs greater than $100,000 but less than or
equal to $200,000;
(3) 80 percent of the total reasonable and necessary
corrective action costs greater than $200,000 but less than or
equal to $300,000; and
(4) 60 percent of the total reasonable and necessary
corrective action costs greater than $300,000 but less than or
equal to $350,000.
(b) A reimbursement or payment may not be made until the
board has determined that the costs are reasonable and are for a
reimbursement of the costs that were actually incurred.
(c) The board may make periodic payments or reimbursements
as corrective action costs are incurred upon receipt of invoices
for the corrective action costs.
(d) Money in the agricultural chemical response and
reimbursement account is appropriated to the commissioner to
make payments and reimbursements directed by the board under
this subdivision.
(e) The board may not make reimbursement greater than the
maximum allowed under paragraph (a) for all incidents on a
single site which:
(1) were not reported at the time of release but were
discovered and reported after July 1, 1989; and
(2) may have occurred prior to July 1, 1989, as determined
by the commissioner.
(f) The board may only reimburse an eligible person for
separate incidents within a single site if the commissioner
determines that each incident is completely separate and
distinct in respect of location within the single site or time
of occurrence.
Sec. 23. Minnesota Statutes 1998, section 21.86,
subdivision 1, is amended to read:
Subdivision 1. [PROHIBITIONS.] A person may not advertise
or sell any agricultural, vegetable, flower, or tree and shrub
seed if:
(a) Except as provided in clauses (1) to (3), a test to
determine the percentage of germination required by sections
21.82 and 21.83 has not been completed within a nine-month
period, exclusive of the calendar month in which the test was
completed.
(1) When advertised or offered for sale as agricultural
seed, native grass and forb seeds must have been tested for
percentage of germination as required by section 21.82 within a
14-month period, exclusive of the calendar month in which the
test was completed.
(2) This prohibition does not apply to tree, shrub,
agricultural, or vegetable seeds packaged in hermetically sealed
containers. Seeds packaged in hermetically sealed containers
under the conditions defined by rule may be offered for sale for
a period of 36 months after the last day of the month that the
seeds were tested for germination prior to packaging.
(3) If seeds in hermetically sealed containers are offered
for sale more than 36 months after the last day of the month in
which they were tested prior to packaging, they must be retested
within a nine-month period, exclusive of the calendar month in
which the retest was completed;
(b) It is not labeled in accordance with sections 21.82 and
21.83 or has false or misleading labeling;
(c) False or misleading advertisement has been used in
respect to its sale;
(d) It contains prohibited noxious weed seeds;
(e) It consists of or contains restricted noxious weed
seeds in excess of 25 seeds per pound or in excess of the number
declared on the label attached to the container of the seed or
associated with the seed;
(f) It contains more than one percent by weight of all weed
seeds;
(g) It contains less than the stated net weight of
contents;
(h) It contains less than the stated number of seeds in the
container;
(i) It contains any labeling, advertising, or other
representation subject to sections 21.82 and 21.83 representing
the seed to be certified unless:
(1) it has been determined by a seed certifying agency that
the seed conformed to standards of purity and identity as to
kind, species, subspecies, or variety, and also that tree seed
was found to be of the origin and elevation claimed, in
compliance with the rules pertaining to the seed; and
(2) the seed bears an official label issued for it by a
seed certifying agency stating that the seed is of a certified
class and a specified kind, species, subspecies, or variety;
(j) It is labeled with a variety name but not certified by
an official seed certifying agency when it is a variety for
which a United States certificate of plant variety protection
has been granted under United States Code, title 7, sections
2481 to 2486, specifying sale by variety name only as a class of
certified seed. Seed from a certified lot may be labeled as to
variety name when used in a blend or mixture by or with approval
of the owner of the variety; or
(k) The person whose name appears on the label does not
have complete records including a file sample of each lot of
agricultural, vegetable, flower, tree or shrub seed sold in this
state as required in section 21.84.
Sec. 24. Minnesota Statutes 1998, section 27.01,
subdivision 8, is amended to read:
Subd. 8. [WHOLESALE PRODUCE DEALER.] (a) "Wholesale
produce dealer" or "dealer at wholesale" means:
(1) a person who buys from or contracts to buy with a
seller for production or sale of produce in wholesale lots for
resale;
(2) a person engaging in the business of a broker or agent,
who handles or deals in produce for a commission or fee;
(3) a truck owner or operator who buys produce in wholesale
lots for resale; and
(4) a person engaged in the business of a cannery, food
manufacturer, or food processor, who purchases produce in
wholesale lots as a part of that business.
(b) For purposes of paragraph (a), "wholesale lots" means
purchases from Minnesota sellers must total more than $12,000
annually.
(c) "Wholesale produce dealer" or "dealer at wholesale"
does not include:
(1) a truck owner and operator who regularly engages in the
business of transporting freight, including produce, for a
transportation fee only, and who does not purchase, contract to
purchase, or sell produce;
(2) a marketing cooperative association in which
substantially all of the voting stock is held by patrons who
patronize the association and in which at least 75 percent of
the business of the association is transacted with member or
stockholder patrons;
(3) a person who purchases Minnesota seasonally grown
perishable fresh fruits and vegetables, and pays cash, including
lawful money of the United States, a cashier's check, a
certified check, or a bank draft;
(4) a person who handles and deals in only canned,
packaged, or processed produce or packaged dairy products that
are no longer perishable as determined by the commissioner by
rule; or
(5) retail merchants who purchase produce, defined in
subdivision 2, directly from farmers, which in the aggregate
does not exceed $500 per month.
Sec. 25. Minnesota Statutes 1998, section 27.19,
subdivision 1, is amended to read:
Subdivision 1. [PROHIBITED ACTS.] (a) A person subject to
the provisions of this section and sections 27.01 to 27.14 may
not:
(1) operate or advertise to operate as a dealer at
wholesale without a license;
(2) make any false statement or report as to the grade,
condition, markings, quality, or quantity of produce, as defined
in section 27.069, received or delivered, or act in any manner
to deceive a consignor or purchaser;
(3) refuse to accept a shipment contracted for by the
person, unless the refusal is based upon the showing of a state
inspection certificate secured with reasonable promptness after
the receipt of the shipment showing that the kind and quality of
produce, as defined in section 27.069, is other than that
purchased or ordered by the person;
(4) fail to account or make a settlement for produce within
the required time;
(5) violate or fail to comply with the terms or conditions
of a contract entered into by the person for the purchase,
production, or sale of produce;
(6) purchase for a person's own account any produce
received on consignment, either directly or indirectly, without
the consent of the consignor;
(7) issue a false or misleading market quotation, or cancel
a quotation during the period advertised by the person;
(8) increase the sales charges on produce shipped to the
person by means of "dummy" or fictitious sales;
(9) receive decorative forest products and the products of
farms and waters from foreign states or countries for sale or
resale, either within or outside of the state, and give the
purchaser the impression, through any method of advertising or
description, that the produce is of Minnesota origin;
(10) fail to notify in writing all suppliers of produce of
the protection afforded to suppliers by the person's licensee
bond, including: availability of a bond, notice requirements,
and any other conditions of the bond;
(11) make a false statement to the commissioner on an
application for license or bond or in response to written
questions from the commissioner regarding the license or bond;
(12) commit to pay and not pay in full for all produce
committed for. A processor may not pay an amount less than the
full contract price if the crop produced is satisfactory for
processing and is not harvested for reasons within the
processor's control. If the processor sets the date for
planting, then bunching, unusual yields, and a processor's
inability or unwillingness to harvest must be considered to be
within the processor's control. Under this clause growers must
be compensated for passed acreage at the same rate for grade and
yield as they would have received had the crop been harvested in
a timely manner minus any contractual provision for green manure
or feed value. Both parties are excused from payment or
performance for crop conditions that are beyond the control of
the parties; or
(13) discriminate between different sections, localities,
communities, or cities, or between persons in the same
community, by purchasing produce from farmers of the same grade,
quality, and kind, at different prices, except that price
differentials are allowed if directly related to the costs of
transportation, shipping, and handling of the produce and a
person is allowed to meet the prices of a competitor in good
faith, in the same locality for the same grade, quality, and
kind of produce. A showing of different prices by the
commissioner is prima facie evidence of discrimination.
(b) A separate violation occurs with respect to each
different person involved, each purchase or transaction
involved, and each false statement.
Sec. 26. Minnesota Statutes 1999 Supplement, section
28A.075, is amended to read:
28A.075 [DELEGATION TO LOCAL BOARD OF HEALTH.]
(a) At the request of a local board of health that licensed
and inspected grocery and convenience stores on January 1, 1999,
the commissioner must enter into agreements before January 1,
2001, with local boards of health to delegate to the appropriate
local board of health the licensing and inspection duties of the
commissioner pertaining to retail food handlers that are grocery
or convenience stores. At the request of a local board of
health that licensed and inspected part of any grocery or
convenience store on January 1, 1999, the commissioner must
enter into agreements before July 1, 2001, with local boards of
health to delegate to the appropriate local board of health the
licensing and inspection duties of the commissioner pertaining
to retail food handlers that are grocery or convenience stores.
Retail grocery or convenience stores inspected under the state
meat inspection program of chapter 31A are exempt from
delegation.
(b) A local board of health must adopt an ordinance
consistent with the Minnesota Food Code, Minnesota Rules,
chapter 4626, for all of its jurisdiction to regulate grocery
and convenience stores and the ordinance (Food Code) must not be
in conflict with standards set in law or rule.
Sec. 27. Minnesota Statutes 1998, section 31.101, as
amended by Laws 1999, chapter 231, section 55, is amended to
read:
31.101 [RULES; HEARINGS; UNIFORMITY WITH FEDERAL LAW.]
Subdivision 1. [AUTHORITY.] The authority to commissioner
may promulgate and amend rules for the efficient administration
and enforcement of the Minnesota Food Law is vested in the
commissioner and is in addition to authority granted in sections
31.10, 31.11, and 31.12. Such The rules when applicable shall
must conform, insofar as practicable and consistent with state
law, with those promulgated under the federal law. This
rulemaking authority is in addition to that in sections 31.10,
31.11, and 31.12. Rules adopted under this section may be
amended by the commissioner under chapter 14, subject to the
limitation in subdivision 7.
Subd. 2. [HEARINGS.] Hearings authorized or required by
law shall must be conducted by the commissioner or such an
officer, agent, or employee as the commissioner may designate
designates for the purpose.
Subd. 3. [FEDERAL PESTICIDE CHEMICAL REGULATIONS RULES.]
Federal pesticide chemical regulations and amendments thereto in
effect on April 1, 1997 2000, adopted under authority of the
Federal Insecticide, Fungicide and Rodenticide Act, as provided
by United States Code, title 7, chapter 6, are the pesticide
chemical rules in this state. Such rules may be amended by the
commissioner proceeding in accordance with the Administrative
Procedure Act.
Subd. 4. [FEDERAL FOOD ADDITIVE REGULATIONS RULES.]
Federal food additive regulations and amendments thereto in
effect on April 1, 1997 2000, as provided by Code of Federal
Regulations, title 21, parts 170 to 199, are the food additive
rules in this state. Such rules may be amended by the
commissioner proceeding in accordance with the Administrative
Procedure Act.
Subd. 5. [FEDERAL COLOR ADDITIVE REGULATIONS RULES.]
Federal color additive regulations and amendments thereto in
effect on April 1, 1997 2000, as provided by Code of Federal
Regulations, title 21, parts 70 to 82, are the color additive
rules in this state. Such rules may be amended by the
commissioner proceeding in accordance with the Administrative
Procedure Act.
Subd. 6. [FEDERAL SPECIAL DIETARY USE REGULATIONS RULES.]
Federal special dietary use regulations and amendments thereto
in effect on April 1, 1997 2000, as provided by Code of Federal
Regulations, title 21, parts 104 and 105, are the special
dietary use rules in this state. Such rules may be amended by
the commissioner proceeding in accordance with the
Administrative Procedure Act.
Subd. 7. [FAIR PACKAGING AND LABELING ACT REGULATIONS
RULES.] Federal regulations and amendments thereto in effect on
April 1, 1997 2000, adopted under the Fair Packaging and
Labeling Act, as provided by United States Code, title 15,
sections 1451 to 1461, are the rules in this state. Such rules
may be amended by the commissioner proceeding in accordance with
the Administrative Procedure Act; provided that The commissioner
shall may not adopt amendments to such these rules or adopt
other rules which are contrary to the labeling requirements for
the net quantity of contents required pursuant to section 4 of
the Fair Packaging and Labeling Act and the
regulations promulgated thereunder adopted under that act.
Subd. 8. [FOOD AND DRUGS REGULATIONS RULES.] Applicable
federal regulations including recodification contained in Code
of Federal Regulations, title 21, parts 0-1299, Food and Drugs,
in effect April 1, 1997 2000, and not otherwise adopted herein,
also are adopted as food rules of this state. Such rules may be
amended by the commissioner in accordance with the
Administrative Procedure Act.
Subd. 9. [FISHERY PRODUCTS RULES.] Federal regulations in
effect on April 1, 1997 2000, as provided by Code of Federal
Regulations, title 50, parts 260 to 267, are incorporated as
part of the fishery products rules in this state for state
inspections performed under a cooperative agreement with the
United States Department of Commerce, National Marine Fisheries
Service. The rules may be amended by the commissioner under
chapter 14.
Subd. 10. [MEAT AND POULTRY RULES.] Federal regulations in
effect on January April 1, 1999 2000, as provided by Code of
Federal Regulations, title 9, part 301, et seq., are
incorporated as part of the meat and poultry rules in this
state. The rules may be amended by the commissioner under
chapter 14.
Subd. 11. [STANDARDS FOR FRESH FRUITS, VEGETABLES, AND
OTHER PRODUCTS.] Federal regulations in effect on April 1,
1997 2000, as provided by Code of Federal Regulations, title 7,
parts 51 and 52, are incorporated as part of the rules in this
state. The rules may be amended by the commissioner under
chapter 14.
Sec. 28. Minnesota Statutes 1998, section 31.102,
subdivision 1, is amended to read:
Subdivision 1. [IDENTITY, QUANTITY, AND FILL OF CONTAINER
RULES.] Federal definitions and standards of identity, quality,
and fill of container and amendments thereto, in effect on April
1, 1997 2000, adopted under authority of the federal act, are
the definitions and standards of identity, quality, and fill of
container in this state. Such The rules may be amended by the
commissioner proceeding in accordance with the Administrative
Procedure Act under chapter 14.
Sec. 29. Minnesota Statutes 1998, section 31.103,
subdivision 1, is amended to read:
Subdivision 1. [CONSUMER COMMODITIES LABELING RULES.] All
labels of consumer commodities shall must conform with the
requirements for the declaration of net quantity of contents of
section 4 of the Fair Packaging and Labeling Act (United States
Code, title 15, section 1451 et seq.) and federal regulations in
effect on April 1, 1997 2000, promulgated pursuant
thereto adopted under authority of that act, except to the
extent that the commissioner shall exercise authority to amend
such amends the rules in accordance with the Administrative
Procedure Act under chapter 14. Consumer commodities exempted
from the requirements of section 4 of the Fair Packaging and
Labeling Act shall are also be exempt from this subdivision.
Sec. 30. Minnesota Statutes 1998, section 31.104, is
amended to read:
31.104 [FOOD LABELING EXEMPTION RULES.]
The commissioner shall promulgate rules exempting from any
labeling requirement food which is, in accordance with the
practice of the trade, to be processed, labeled or repacked in
substantial quantities at establishments other than those where
originally processed or packed, on condition that such food is
not adulterated or misbranded upon removal from such processing,
labeling or repacking establishment.
Federal regulations in effect on April 1, 1997 2000,
adopted under authority of the federal act relating to such
exemptions are effective in this state unless the commissioner
shall exercise authority to amend such regulations amends them.
The commissioner also may promulgate amendments to amend
existing rules concerning exemptions in accordance with the
Administrative Procedure Act under chapter 14.
Sec. 31. Minnesota Statutes 1998, section 31.632, is
amended to read:
31.632 [MINNESOTA APPROVED MEATS; USE OF LABEL.]
The commissioner may authorize, pursuant to rules
promulgated in the manner provided by law, the use of the label
"Minnesota Approved" on meats and, meat products, poultry, and
poultry products processed by persons licensed under sections
31.51 to 31.58, or by establishments under the inspection
program of the United States Department of Agriculture, if the
ingredients of such the poultry, poultry products, meats, and
meat products are meat, meat by-products, poultry, poultry
products, or meat food products which have been inspected and
passed by the United States Department of Agriculture, or the
Minnesota department of agriculture and further if such the
poultry, poultry products, meats, and meat products, after such
processing, are sound, healthful, wholesome, and fit for human
food. A person or establishment desiring to label poultry,
poultry products, meats, and meat products as provided in this
section shall apply to the commissioner for authority to do so.
The commissioner shall grant this authority to the applicant if
the applicant complies with the provisions of this section and
rules promulgated pursuant to this section. A person using the
label "Minnesota Approved" on poultry, poultry products, meat
and, or meat products contrary to law is guilty of a misdemeanor.
Sec. 32. Minnesota Statutes 1998, section 31.633,
subdivision 1, is amended to read:
Subdivision 1. [MENU REQUIREMENT.] Any restaurant, eating
place, or other establishment serving meat or poultry in any
form to the public, which meat that has any filler or meat or
poultry substitute added to it or incorporated in it, shall
clearly and prominently indicate on its menu or bill of fare the
meat entrees that contain filler or meat or poultry substitutes.
Sec. 33. Minnesota Statutes 1998, section 31.651, is
amended to read:
31.651 [KOSHER PRODUCTS, UNLAWFUL SALE.]
Subdivision 1. [KOSHER REQUIREMENTS.] No person shall sell
or expose for sale any poultry, poultry products, meat, or meat
preparations and falsely represent the same to be kosher,
whether such poultry, poultry products, meat, or meat
preparations be raw or prepared for human consumption; nor shall
the person permit any such products or the contents of any
package or container to be labeled or to have inscribed thereon
the word "kosher" in any language unless such products shall
have been prepared or processed in accordance with orthodox
Hebrew religious requirements sanctioned by a recognized
rabbinical council.
Subd. 2. [NOTICE REQUIRED.] Any person who sells or
exposes for sale in the same place of business both kosher and
nonkosher poultry, meat, or meat preparations, either raw or
prepared for human consumption, shall indicate on window signs
and all display advertising, in block letters at least four
inches in height, "kosher and nonkosher meat and poultry sold
here"; and shall display over each kind of poultry, meat, or
meat preparation so exposed a sign, in block letters at least
two inches in height, reading, "kosher meat," or "kosher
poultry," "nonkosher meat," or "nonkosher poultry," as the case
may be; provided that subdivision 2 shall not apply to persons
selling or offering for sale kosher poultry, poultry products,
meats, or meat products solely in separate consumer packages,
which have been prepackaged and properly labeled "kosher."
Subd. 3. [PRESUMPTION.] Possession of nonkosher poultry,
poultry products, meat, or meat preparations in any place of
business shall be presumptive evidence that the person in
possession thereof exposes the same for sale.
Subd. 4. [PRIMA FACIE EVIDENCE.] The absence of a duly
sanctioned kosher "plumba," mark, stamp, tag, brand, or label
from any poultry, poultry products, meat, meat preparation, or
food product shall be prima facie evidence that such product is
nonkosher.
Sec. 34. Minnesota Statutes 1999 Supplement, section
31A.01, is amended to read:
31A.01 [POLICY.]
Meat, poultry, poultry food products, and meat food
products are an important source of the nation's total supply of
food. It is essential in the public interest that the health
and welfare of consumers be protected by assuring that meat,
poultry, and meat food products distributed to them are
wholesome, unadulterated, and properly marked, labeled, and
packaged. Unwholesome, adulterated, or misbranded meat,
poultry, poultry food products, or meat food products injure the
public welfare, destroy markets for wholesome, unadulterated,
and properly labeled and packaged meat, poultry, poultry food
products, and meat food products, and result in losses to
livestock producers and processors of meat, poultry, poultry
food products, and meat food products and injury to consumers.
Unwholesome, adulterated, mislabeled, or deceptively packaged
articles can be sold at lower prices and compete unfairly with
wholesome, unadulterated, and properly labeled and packaged
articles, to the detriment of consumers and the general public.
Regulation by the commissioner and cooperation between this
state and the United States under this chapter are appropriate
to protect the health and welfare of consumers and accomplish
the purposes of this chapter.
Sec. 35. Minnesota Statutes 1998, section 31A.02,
subdivision 5, is amended to read:
Subd. 5. [CUSTOM PROCESSING.] "Custom processing" means
slaughtering, eviscerating, dressing, or processing an animal or
processing meat products or poultry products for the owner of
the animal or of the meat products and poultry products, if all
meat products or poultry products derived from the custom
operation are returned to the owner of the animal or of the meat
products or poultry products. No person may sell, offer for
sale, or possess with intent to sell meat derived from custom
processing.
Sec. 36. Minnesota Statutes 1998, section 31A.02,
subdivision 6, is amended to read:
Subd. 6. [MEAT BROKER.] "Meat broker" means a person in
the business of buying or selling carcasses, parts of carcasses,
meat, or meat food products, poultry, or poultry products of
animals on commission, or otherwise negotiating purchases or
sales of those articles other than for the person's own account
or as an employee of another person, firm, or corporation.
Sec. 37. Minnesota Statutes 1998, section 31A.02,
subdivision 10, is amended to read:
Subd. 10. [MEAT FOOD PRODUCT; POULTRY FOOD PRODUCT.] "Meat
food product" or "poultry food product" means a product usable
as human food and made wholly or in part from meat or poultry or
a portion of the carcass of cattle, sheep, swine, poultry,
farmed cervidae, as defined in section 17.451, subdivision 2,
llamas, as defined in section 17.455, subdivision 2, ratitae, as
defined in section 17.453, subdivision 3, or goats. "Meat food
product" or "poultry food product" does not include products
which contain meat, poultry, or other portions of the carcasses
of cattle, sheep, swine, farmed cervidae, llamas, ratitae, or
goats only in a relatively small proportion or that historically
have not been considered by consumers as products of the meat
food industry, and which are exempted from definition as a meat
food product or poultry food product by the commissioner under
the conditions the commissioner prescribes to assure that the
meat or other portions of carcasses contained in the products
are not adulterated and that the products are not represented as
meat food products or poultry food products.
"Meat food product," as applied to products of equines, has
a meaning comparable to that for cattle, sheep, swine, farmed
cervidae, llamas, ratitae, and goats.
Sec. 38. Minnesota Statutes 1998, section 31A.02,
subdivision 13, is amended to read:
Subd. 13. [ADULTERATED.] "Adulterated" means a carcass,
part of a carcass, meat, poultry, poultry food product, or meat
food product under one or more of the following circumstances:
(a) if it bears or contains a poisonous or harmful
substance which may render it injurious to health; but if the
substance is not an added substance, the article is not
adulterated if the quantity of the substance in or on the
article does not ordinarily make it injurious to health;
(b) if it bears or contains, by administration of a
substance to the live animal or otherwise, an added poisonous or
harmful substance, other than (1) a pesticide chemical in or on
a raw agricultural commodity; (2) a food additive; or (3) a
color additive, which may, in the judgment of the commissioner,
make the article unfit for human food;
(c) if it is, in whole or in part, a raw agricultural
commodity that bears or contains a pesticide chemical which is
unsafe within the meaning of section 408 of the Federal Food,
Drug, and Cosmetic Act;
(d) if it bears or contains a food additive which is unsafe
within the meaning of section 409 of the Federal Food, Drug, and
Cosmetic Act;
(e) if it bears or contains a color additive which is
unsafe within the meaning of section 706 of the Federal Food,
Drug, and Cosmetic Act;
(f) if it contains a filthy, putrid, or decomposed
substance or is for any other reason unfit for human food;
(g) if it has been prepared, packed, or held under
unsanitary conditions so that it may be contaminated with filth
or harmful to health;
(h) if it is wholly or partly the product of an animal
which has died otherwise than by slaughter;
(i) if its container is wholly or partly composed of a
poisonous or harmful substance which may make the contents
harmful to health;
(j) if it has been intentionally subjected to radiation,
unless the use of the radiation conformed with a regulation or
exemption in effect under section 409 of the Federal Food, Drug,
and Cosmetic Act;
(k) if a valuable constituent has been wholly or partly
omitted or removed from it; if a substance has been wholly or
partly substituted for it; if damage or inferiority has been
concealed; or if a substance has been added to it or mixed or
packed with it so as to increase its bulk or weight, reduce its
quality or strength, or make it appear better or of greater
value than it is; or
(l) if it is margarine containing animal fat and any of the
raw material used in it wholly or partly consisted of a filthy,
putrid, or decomposed substance.
Sec. 39. Minnesota Statutes 1998, section 31A.02,
subdivision 14, is amended to read:
Subd. 14. [MISBRANDED.] "Misbranded" means a carcass, part
of a carcass, meat, poultry, poultry food product, or meat food
product under one or more of the following circumstances:
(a) if its labeling is false or misleading;
(b) if it is offered for sale under the name of another
food;
(c) if it is an imitation of another food, unless its label
bears, in type of uniform size and prominence, the word
"imitation" followed immediately by the name of the food
imitated;
(d) if its container is made, formed, or filled so as to be
misleading;
(e) if its package or other container does not have a label
showing (1) the name and place of business of the manufacturer,
packer, or distributor; and (2) an accurate statement of the
quantity of the contents in terms of weight, measure, or
numerical count subject to reasonable variations permitted and
exemptions for small packages established in rules of the
commissioner;
(f) if a word, statement, or other information required by
or under authority of this chapter to appear on the label or
other labeling is not prominently and conspicuously placed on
the label or labeling in terms that make it likely to be read
and understood by the ordinary individual under customary
conditions of purchase and use;
(g) if it is represented as a food for which a definition
and standard of identity or composition has been prescribed by
rules of the commissioner under section 31A.07, unless (1) it
conforms to the definition and standard, and (2) its label bears
the name of the food specified in the definition and standard
and, if required by the rules, the common names of optional
ingredients, other than spices, flavoring, and coloring, present
in the food;
(h) if it is represented as a food for which a standard of
fill of container has been prescribed by rules of the
commissioner under section 31A.07, and it falls below the
applicable standard of fill of container, unless its label
bears, in the manner and form the rules specify, a statement
that it falls below the standard;
(i) if it is not subject to paragraph (g), unless its label
bears (1) the usual name of the food, if there is one, and (2)
in case it is fabricated from two or more ingredients, the
common or usual name of each ingredient; except that spices,
flavorings, and colorings may, when authorized by the
commissioner, be designated as spices, flavorings, and colorings
without naming each. To the extent that compliance with clause
(2) is impracticable, or results in deception or unfair
competition, the commissioner shall establish exemptions by
rule;
(j) if it purports to be or is represented for special
dietary uses, unless its label bears the information concerning
its vitamin, mineral, and other dietary properties that the
commissioner, after consultation with the Secretary of
Agriculture of the United States, determines by rule to be
necessary to inform purchasers of its value for special dietary
uses;
(k) if it bears or contains any artificial flavoring,
artificial coloring, or chemical preservative, unless it bears
labeling stating that fact;
(l) if it fails to bear, directly or on its container, as
the commissioner by rule prescribes, the inspection legend and
other information the commissioner may require by rule to assure
that it will not have false or misleading labeling and that the
public will be told how to keep the article wholesome.
Sec. 40. Minnesota Statutes 1998, section 31A.03, is
amended to read:
31A.03 [INSPECTION OF LIVE ANIMALS; DISPOSITION OF
DEFECTIVE ANIMALS.]
To prevent the use in intrastate commerce of adulterated
meat and, meat food products, poultry, and poultry food
products, the commissioner shall appoint inspectors and have
them examine and inspect all animals before the animals enter a
slaughtering, packing, meat canning, rendering, or similar
establishment in this state in which slaughtering of animals and
preparation of meat and, meat food products, poultry, and
poultry food products are conducted solely for intrastate
commerce. Animals found on inspection to show symptoms of
disease must be set apart and slaughtered separately from other
animals. The carcasses of those animals must be carefully
examined and inspected under rules of the commissioner.
Sec. 41. Minnesota Statutes 1998, section 31A.05, is
amended to read:
31A.05 [APPLICATION OF INSPECTION PROVISIONS.]
Sections 31A.03 and 31A.04 apply to carcasses or parts of
animals, poultry, or poultry food products, and meat or meat
products derived from them that are usable as human food, when
these items are brought into a slaughtering, meat canning,
salting, packing, rendering, or similar establishment, where
inspection under sections 31A.01 to 31A.16 is done. Examination
and inspection must be made before the carcasses or animal parts
may enter into a department where they are to be treated and
prepared for meat food products or poultry food products.
Sections 31A.03 and 31A.04 also apply to products which,
after having been issued from a slaughtering, meat canning,
salting, packing, rendering, or similar establishment, must be
returned to it or to a similar establishment where inspection is
done.
The commissioner may limit the entry of carcasses, parts of
carcasses, poultry, poultry food products, meat and, meat food
products, and other materials into an establishment where
inspection under sections 31A.01 to 31A.16 is done to conditions
the commissioner prescribes to assure that allowing the entry of
articles into inspected establishments is consistent with the
purposes of this chapter.
Sec. 42. Minnesota Statutes 1998, section 31A.06, is
amended to read:
31A.06 [INSPECTORS' DUTIES.]
The commissioner shall appoint inspectors to examine and
inspect poultry food products and meat food products prepared in
a slaughtering, meat canning, salting, packing, rendering, or
similar establishment, where the articles are prepared solely
for intrastate commerce. For examination and inspection
purposes, the inspectors must be given access at all times,
whether the establishment is operated or not, to every part of
the establishment. The inspectors shall mark, stamp, tag, or
label as "Minnesota Inspected and Passed" all products found to
be unadulterated, and the inspectors shall label, mark, stamp,
or tag as "Minnesota Inspected and Condemned" all products found
to be adulterated. Condemned meat food products or poultry food
products must be destroyed for food purposes under section
31A.04. The commissioner may remove inspectors from an
establishment which fails to destroy condemned poultry food
products or meat food products.
Sec. 43. Minnesota Statutes 1998, section 31A.07,
subdivision 1, is amended to read:
Subdivision 1. [LABELING; PACKING.] When poultry, poultry
food products, meat, or a meat food product products prepared
for intrastate commerce which has have been inspected and marked
"Minnesota Inspected and Passed" is placed or packed in a can,
pot, tin, canvas, or other receptacle or covering in an
establishment where inspection is done under sections 31A.01 to
31A.31, the person, firm, or corporation preparing the product
shall have a label attached to the can, pot, tin, canvas, or
other receptacle or covering, under supervision of an
inspector. The label must state that the contents have been
"Minnesota Inspected and Passed" under sections 31A.01 to
31A.31. An inspection or examination of poultry, poultry food
products, meat, or meat food products deposited or enclosed in
cans, tins, pots, canvas, or other receptacles or coverings in
an establishment where inspection is done under this chapter is
not complete until the poultry, poultry food products, meat, or
meat food products have been sealed or enclosed in the can, tin,
pot, canvas, or other receptacle or covering under the
supervision of an inspector.
Sec. 44. Minnesota Statutes 1998, section 31A.07,
subdivision 2, is amended to read:
Subd. 2. [LABELS; MARKS.] All carcasses, parts of
carcasses, poultry, poultry food products, meat, and meat food
products inspected at an establishment under this chapter and
found not to be adulterated, must when they leave the
establishment bear, directly or on their containers, legible
labels or official marks as required by the commissioner.
Sec. 45. Minnesota Statutes 1998, section 31A.08, is
amended to read:
31A.08 [RULES.]
The commissioner shall have experts in sanitation or other
competent inspectors inspect all slaughtering, meat canning,
salting, packing, rendering, or similar establishments in which
animals are slaughtered and their poultry, poultry food
products, meat, and meat food products are prepared solely for
intrastate commerce. The inspections must be conducted as
necessary for the commissioner to know the sanitary conditions
of the establishments, and to prescribe the rules of sanitation
under which the establishments must be maintained. If an
establishment has sanitary conditions that allow poultry,
poultry food products, meat, or meat food products to become
adulterated, the commissioner shall refuse to allow the poultry,
poultry food products, meat, or meat food products to be
labeled, marked, stamped, or tagged as "Minnesota Inspected and
Passed."
Sec. 46. Minnesota Statutes 1998, section 31A.10, is
amended to read:
31A.10 [PROHIBITIONS.]
No person may, with respect to an animal, carcass, part of
a carcass, poultry, poultry food product, meat, or meat food
product:
(1) slaughter an animal or prepare an article that is
usable as human food, at any establishment preparing articles
solely for intrastate commerce, except in compliance with this
chapter;
(2) sell, transport, offer for sale or transportation, or
receive for transportation, in intrastate commerce (i) articles
which are usable as human food and are adulterated or misbranded
at the time of sale, transportation, offer for sale or
transportation, or receipt for transportation; or (ii) articles
required to be inspected under sections 31A.01 to 31A.16 that
have not been inspected and passed;
(3) do something to an article that is usable as human food
while the article is being transported in intrastate commerce or
held for sale after transportation, which is intended to cause
or has the effect of causing the article to be adulterated or
misbranded; or
(4) sell, offer for sale, or possess with intent to sell
meat derived from custom processing.
Sec. 47. Minnesota Statutes 1998, section 31A.13, is
amended to read:
31A.13 [INSPECTORS.]
The commissioner shall appoint inspectors to inspect
animals, whole or parts of carcasses, poultry, poultry food
products, meat, and meat food products the inspection of which
is provided for by law, and the sanitary conditions of all
establishments in which the poultry, poultry food products,
meat, and meat food products are prepared. Inspectors shall
refuse to stamp, mark, tag, or label a whole or part of a
carcass or a meat food product derived from it, prepared in an
establishment covered by sections 31A.01 to 31A.12, until it has
actually been inspected and found to be not adulterated.
Inspectors shall perform other duties required by this chapter
or by rules adopted by the commissioner that are necessary for
the efficient execution of this chapter. Inspections under this
chapter must conform to the rules adopted by the commissioner
consistent with this chapter.
Sec. 48. Minnesota Statutes 1999 Supplement, section
31A.15, subdivision 1, is amended to read:
Subdivision 1. [INSPECTION.] The provisions of sections
31A.01 to 31A.16 requiring inspection of the slaughter of
animals and the preparation of the carcasses, parts of
carcasses, meat, poultry, poultry food products, and meat food
products at establishments conducting slaughter and preparation
do not apply:
(1) to the processing by a person of the person's own
animals and the owner's preparation and transportation in
intrastate commerce of the carcasses, parts of carcasses, meat,
poultry, poultry food products, and meat food products of those
animals exclusively for use by the owner and members of the
owner's household, nonpaying guests, and employees; or
(2) to the custom processing by a person of cattle, sheep,
swine, poultry, or goats delivered by the owner for processing,
and the preparation or transportation in intrastate commerce of
the carcasses, parts of carcasses, meat, poultry, poultry food
products, and meat food products of animals, exclusively for use
in the household of the owner by the owner and members of the
owner's household, nonpaying guests, and employees. Meat from
custom processing of cattle, sheep, swine, poultry, or goats
must be identified and handled as required by the commissioner,
during all phases of processing, chilling, cooling, freezing,
preparation, storage, and transportation. The custom processor
may not engage in the business of buying or selling carcasses,
parts of carcasses, meat, poultry, poultry food products, or
meat food products of animals usable as human food unless the
carcasses, parts of carcasses, meat, poultry, poultry food
products, or meat food products have been inspected and passed
and are identified as inspected and passed by the Minnesota
department of agriculture or the United States Department of
Agriculture.
Sec. 49. Minnesota Statutes 1998, section 31A.16, is
amended to read:
31A.16 [STORING AND HANDLING CONDITIONS.]
The commissioner may adopt rules prescribing conditions
under which carcasses, parts of carcasses, poultry, poultry food
products, meat, and meat food products of animals usable as
human food must be stored or otherwise handled by a person in
the business of buying, selling, freezing, storing, or
transporting them, in or for intrastate commerce, if the
commissioner considers action necessary to assure that the
articles will not be adulterated or misbranded when delivered to
the consumer.
Sec. 50. Minnesota Statutes 1998, section 31A.17, is
amended to read:
31A.17 [ARTICLES NOT INTENDED AS HUMAN FOOD.]
Inspection must not be provided under sections 31A.01 to
31A.16 at an establishment for the slaughter of animals or the
preparation of carcasses or parts or products of animals which
are not intended for use as human food. Before they are offered
for sale or transportation in intrastate commerce, those
articles must be denatured or otherwise identified as prescribed
by rules of the commissioner to deter their use for human food,
unless they are naturally inedible by humans. No person may
buy, sell, transport, offer for sale or transportation, or
receive for transportation, in intrastate commerce, carcasses,
parts of carcasses, poultry, poultry food products, meat, or
meat food products of animals which are not intended for use as
human food unless they are denatured or otherwise identified as
required by the rules of the commissioner or are naturally
inedible by humans.
Sec. 51. Minnesota Statutes 1998, section 31B.02,
subdivision 4, is amended to read:
Subd. 4. [LIVESTOCK.] "Livestock" means live or dead
cattle, sheep, swine, horses, mules, farmed cervidae, as defined
in section 17.451, subdivision 2, llamas, as defined in section
17.455, subdivision 2, ratitae, as defined in section 17.453,
subdivision 3, bison (buffalo), or goats.
Sec. 52. Minnesota Statutes 1999 Supplement, section
31B.07, subdivision 3, is amended to read:
Subd. 3. [EXPIRATION.] The reporting provisions of this
section expire 30 days after a department or agency of the
federal government has a price reporting requirement at least as
comprehensive as this section, as determined by the commissioner
and results in Minnesota-specific information being available to
the commissioner and to Minnesota producers.
Sec. 53. Minnesota Statutes 1998, section 41B.03,
subdivision 1, is amended to read:
Subdivision 1. [ELIGIBILITY GENERALLY.] To be eligible for
a program in sections 41B.01 to 41B.23:
(1) a borrower must be a resident of Minnesota or a
domestic family farm corporation, as defined in section 500.24,
subdivision 2; and
(2) the borrower or one of the borrowers must be the
principal operator of the farm or, for a prospective homestead
redemption borrower, must have at one time been the principal
operator of a farm; and
(3) the borrower must not receive assistance under sections
41B.01 to 41B.23 exceeding an aggregate of $100,000 in loans
during the borrower's lifetime.
Sec. 54. Minnesota Statutes 1998, section 41B.03,
subdivision 2, is amended to read:
Subd. 2. [ELIGIBILITY FOR RESTRUCTURED LOAN.] In addition
to the eligibility requirements of subdivision 1, a prospective
borrower for a restructured loan must:
(1) have received at least 50 percent of average annual
gross income from farming for the past three years or, for
homesteaded property, received at least 40 percent of average
gross income from farming in the past three years, and farming
must be the principal occupation of the borrower;
(2) have a debt-to-asset ratio equal to or greater than 50
percent and in determining this ratio, the assets must be valued
at their current market value;
(3) have projected annual expenses, including operating
expenses, family living, and interest expenses after the
restructuring, that do not exceed 95 percent of the borrower's
projected annual income considering prior production history and
projected prices for farm production, except that the authority
may reduce the 95 percent requirement if it finds that other
significant factors in the loan application support the making
of the loan; and
(4) demonstrate substantial difficulty in meeting projected
annual expenses without restructuring the loan; and
(5) must have a total net worth, including assets and
liabilities of the borrower's spouse and dependents, of less
than $400,000 in 1999 and an amount in subsequent years which is
adjusted for inflation by multiplying $400,000 by the cumulative
inflation rate as determined by the United States All-Items
Consumer Price Index.
Sec. 55. Minnesota Statutes 1998, section 41B.039,
subdivision 2, is amended to read:
Subd. 2. [STATE PARTICIPATION.] The state may participate
in a new real estate loan with an eligible lender to a beginning
farmer to the extent of 45 percent of the principal amount of
the loan or $100,000 $125,000, whichever is less. The interest
rates and repayment terms of the authority's participation
interest may be different than the interest rates and repayment
terms of the lender's retained portion of the loan.
Sec. 56. Minnesota Statutes 1998, section 41B.04,
subdivision 8, is amended to read:
Subd. 8. [STATE'S PARTICIPATION.] With respect to loans
that are eligible for restructuring under sections 41B.01 to
41B.23 and upon acceptance by the authority, the authority shall
enter into a participation agreement or other financial
arrangement whereby it shall participate in a restructured loan
to the extent of 45 percent of the primary principal or
$100,000 $150,000, whichever is less. The authority's portion
of the loan must be protected during the authority's
participation by the first mortgage held by the eligible lender
to the extent of its participation in the loan.
Sec. 57. Minnesota Statutes 1998, section 41B.042,
subdivision 4, is amended to read:
Subd. 4. [PARTICIPATION LIMIT; INTEREST.] The authority
may participate in new seller-sponsored loans to the extent of
45 percent of the principal amount of the loan or
$100,000 $125,000, whichever is less. The interest rates and
repayment terms of the authority's participation interest may be
different than the interest rates and repayment terms of the
seller's retained portion of the loan.
Sec. 58. Minnesota Statutes 1998, section 41B.043,
subdivision 2, is amended to read:
Subd. 2. [SPECIFICATIONS.] No direct loan may exceed
$35,000 or $100,000 $125,000 for a loan participation or be made
to refinance an existing debt. Each direct loan and
participation must be secured by a mortgage on real property and
such other security as the authority may require.
Sec. 59. Minnesota Statutes 1998, section 41B.045,
subdivision 2, is amended to read:
Subd. 2. [LOAN PARTICIPATION.] The authority may
participate in a livestock expansion loan with an eligible
lender to a livestock farmer who meets the requirements of
section 41B.03, subdivision 1, clauses (1) and (2), and who are
actively engaged in a livestock operation. A prospective
borrower must have a total net worth, including assets and
liabilities of the borrower's spouse and dependents, of less
than $400,000 in 1999 and an amount in subsequent years which is
adjusted for inflation by multiplying $400,000 by the cumulative
inflation rate as determined by the United States All-Items
Consumer Price Index.
Participation is limited to 45 percent of the principal
amount of the loan or $250,000, whichever is less. The interest
rates and repayment terms of the authority's participation
interest may be different from the interest rates and repayment
terms of the lender's retained portion of the loan. Loans under
this program must not be included in the lifetime limitation
calculated under section 41B.03, subdivision 1.
Sec. 60. Minnesota Statutes 1998, section 223.16,
subdivision 5, is amended to read:
Subd. 5. [GRAIN BUYER.] "Grain buyer" means a person who
purchases grain from a producer for the purpose of reselling the
grain with the exception of a person who purchases seed grain
for crop production or who purchases grain as feed for the
person's own livestock.
Sec. 61. Minnesota Statutes 1998, section 223.17,
subdivision 5, is amended to read:
Subd. 5. [CASH SALES; MANNER OF PAYMENT.] For a cash sale
of a shipment of grain which is part of a multiple shipment
sale, the grain buyer shall tender payment to the seller in cash
or by check not later than ten days after the sale of that
shipment, except that when the entire sale is completed, payment
shall be tendered not later than the close of business on the
next day, or within 48 hours, whichever is later. For other
cash sales the grain buyer, before the close of business on the
next business day after the sale, shall tender payment to the
seller in cash or by check, or shall wire or mail funds to the
seller's account in the amount of at least 80 percent of the
value of the grain at the time of delivery. The grain buyer
shall complete final settlement as rapidly as possible through
ordinary diligence. Any transaction which is not a cash sale in
compliance with the provisions of this subdivision constitutes a
voluntary extension of credit which is not afforded protection
under the grain buyer's bond, and which must comply with
sections 223.175 and 223.177.
Sec. 62. Minnesota Statutes 1998, section 223.175, is
amended to read:
223.175 [WRITTEN VOLUNTARY EXTENSION OF CREDIT CONTRACTS;
FORM.]
A written confirmation required under section 223.177,
subdivision 2, and a written voluntary extension of credit
contract must include those items prescribed by the commissioner
by rule. A contract shall include a statement of the legal and
financial responsibilities of grain buyers and sellers
established in this chapter. A contract shall also include the
following statement in not less than ten point, all capital
type, framed in a box with space provided for the seller's
signature: "THIS CONTRACT CONSTITUTES A VOLUNTARY EXTENSION OF
CREDIT. THIS CONTRACT IS NOT COVERED BY ANY GRAIN BUYER'S
BOND." If a written contract is provided at the time the grain
is delivered to the grain buyer, the seller shall sign the
contract in the space provided beneath the statement. A
transaction that does not meet the provisions of a voluntary
extension of credit, including the issuance and signing of a
voluntary extension of credit contract, is a cash sale.
Sec. 63. Minnesota Statutes 1998, section 232.21, is
amended by adding a subdivision to read:
Subd. 14. [OPEN STORAGE.] "Open storage" means grain or
agricultural products received by a warehouse operator from a
depositor for which warehouse receipts have not been issued or a
purchase made and the records documented accordingly.
Sec. 64. Minnesota Statutes 1998, section 232.23,
subdivision 1, is amended to read:
Subdivision 1. [DISCRIMINATION PROHIBITED.] (a) Except as
provided in paragraph (b), a public grain warehouse operator
must receive for storage, so far as the capacity of the grain
warehouse will permit, all sound grain tendered in warehouseable
condition without discrimination against any person tendering
the grain.
(b) The requirements in paragraph (a) do not apply to
storage capacity owned by producers that is managed by the
public grain warehouse operator but is not under the same
ownership as the grain warehouse.
Sec. 65. Minnesota Statutes 1998, section 232.23,
subdivision 3, is amended to read:
Subd. 3. [GRAIN DELIVERED CONSIDERED SOLD STORED.] All
grain delivered to a public grain warehouse operator shall be
considered sold stored at the time of delivery, unless
arrangements have been made with the public grain warehouse
operator prior to or at the time of delivery to apply the grain
on contract, for shipment or consignment or for storage cash
sale. Grain may be held in open storage or placed on a
warehouse receipt. Warehouse receipts must be issued for all
grain held in open storage within six months of delivery to the
warehouse unless the depositor has signed a statement that the
depositor does not desire a warehouse receipt. The warehouse
operator's tariff applies for any grain that is retained in open
storage or under warehouse receipt.
Sec. 66. Minnesota Statutes 1998, section 232.23,
subdivision 6, is amended to read:
Subd. 6. [LIABILITY.] A public grain warehouse
operator issuing a grain warehouse receipt is liable to the
depositor for the delivery of the kind, grade, and net quantity
of grain called for by the grain warehouse receipt. or scale
ticket marked "store."
Sec. 67. Minnesota Statutes 1999 Supplement, section
500.24, subdivision 2, is amended to read:
Subd. 2. [DEFINITIONS.] The definitions in this
subdivision apply to this section.
(a) "Farming" means the production of (1) agricultural
products; (2) livestock or livestock products; (3) milk or milk
products; or (4) fruit or other horticultural products. It does
not include the processing, refining, or packaging of said
products, nor the provision of spraying or harvesting services
by a processor or distributor of farm products. It does not
include the production of timber or forest products, the
production of poultry or poultry products, or the feeding and
caring for livestock that are delivered to a corporation for
slaughter or processing for up to 20 days before slaughter or
processing.
(b) "Family farm" means an unincorporated farming unit
owned by one or more persons residing on the farm or actively
engaging in farming.
(c) "Family farm corporation" means a corporation founded
for the purpose of farming and the ownership of agricultural
land in which the majority of the voting stock is held by and
the majority of the stockholders are persons or, the spouses of
persons, or current beneficiaries of one or more family farm
trusts in which the trustee holds stock in a family farm
corporation, related to each other within the third degree of
kindred according to the rules of the civil law, and at least
one of said the related persons is residing on or actively
operating the farm, and none of whose stockholders are
corporations; provided that a family farm corporation shall not
cease to qualify as such hereunder by reason of any devise or
bequest:
(1) transfer of shares of voting stock to a person or the
spouse of a person related within the third degree of kindred
according to the rules of civil law to the person making the
transfer, or to a family farm trust of which the shareholder,
spouse, or related person is a current beneficiary; or
(2) distribution from a family farm trust of shares of
stock to a beneficiary related within the third degree of
kindred according to the rules of civil law to a majority of the
current beneficiaries of the trust, or to a family farm trust of
which the shareholder, spouse, or related person is a current
beneficiary.
For the purposes of this section, a transfer may be made
with or without consideration, either directly or indirectly,
during life or at death, whether or not in trust, of the shares
in the family farm corporation, and stock owned by a family farm
trust are considered to be owned in equal shares by the current
beneficiaries.
(d) "Family farm trust" means:
(1) a trust in which:
(i) a majority of the current beneficiaries are persons or
spouses of persons who are related to each other within the
third degree of kindred according to the rules of civil law;
(ii) all of the current beneficiaries are natural persons
or nonprofit corporations or trusts described in Internal
Revenue Code, section 170(c), as amended, and the regulations
under that section; and
(iii) one of the family member current beneficiaries is
residing on or actively operating the farm; or
(2) a charitable remainder trust as defined in Internal
Revenue Code, section 664, as amended, and the regulations under
that section, and a charitable lead trust as set forth in
Internal Revenue Code, section 170(f), and the regulations under
that section, if the lead period does not exceed ten years and
the majority of remainder beneficiaries are related to the
grantor within the third degree of kindred according to the
rules of civil law.
For the purposes of this section, if a distributee trust
becomes entitled to, or at the discretion of any person may
receive, a distribution from income or principal of a family
farm trust, then the distributee trust must independently
qualify as a family farm trust.
(e) "Authorized farm corporation" means a corporation
meeting the following standards:
(1) it has no more than five shareholders, provided that
for the purposes of this section, a husband and wife are
considered one shareholder;
(2) all its shareholders, other than any estate, are
natural persons;
(3) it does not have more than one class of shares;
(4) its revenue from rent, royalties, dividends, interest,
and annuities does not exceed 20 percent of its gross receipts;
(5) shareholders holding 51 percent or more of the interest
in the corporation reside on the farm or are actively engaging
in farming;
(6) it does not, directly or indirectly, own or otherwise
have an interest in any title to more than 1,500 acres of
agricultural land; and
(7) none of its shareholders are shareholders in other
authorized farm corporations that directly or indirectly in
combination with the corporation own more than 1,500 acres of
agricultural land.
(e) (f) "Authorized livestock farm corporation" means a
corporation formed for the production of livestock and meeting
the following standards:
(1) it is engaged in the production of livestock other than
dairy cattle;
(2) all its shareholders, other than any estate, are
natural persons or family farm corporations;
(3) it does not have more than one class of shares;
(4) its revenue from rent, royalties, dividends, interest,
and annuities does not exceed 20 percent of its gross receipts;
(5) shareholders holding 75 percent or more of the control,
financial, and capital investment in the corporation are farmers
residing in Minnesota and at least 51 percent of the required
percentage of farmers are actively engaged in livestock
production;
(6) it does not, directly or indirectly, own or otherwise
have an interest in any title to more than 1,500 acres of
agricultural land; and
(7) none of its shareholders are shareholders in other
authorized farm corporations that directly or indirectly in
combination with the corporation own more than 1,500 acres of
agricultural land.
(f) (g) "Agricultural land" means real estate used for
farming or capable of being used for farming in this state.
(g) (h) "Pension or investment fund" means a pension or
employee welfare benefit fund, however organized, a mutual fund,
a life insurance company separate account, a common trust of a
bank or other trustee established for the investment and
reinvestment of money contributed to it, a real estate
investment trust, or an investment company as defined in United
States Code, title 15, section 80a-3.
(h) (i) "Farm homestead" means a house including adjoining
buildings that has been used as part of a farming operation or
is part of the agricultural land used for a farming operation.
(i) (j) "Family farm partnership" means a limited
partnership formed for the purpose of farming and the ownership
of agricultural land in which the majority of the interests in
the partnership is held by and the majority of the partners are
persons or, the spouses of persons, or current beneficiaries of
one or more family farm trusts in which the trustee holds an
interest in a family farm partnership related to each other
within the third degree of kindred according to the rules of the
civil law, at least one of the related persons is residing on or
the farm, actively operating the farm, or the agricultural land
was owned by one or more of the related persons for a period of
five years before its transfer to the limited partnership, and
none of the partners are corporations. A family farm
partnership does not cease to qualify as a family farm
partnership because of a devise or bequest:
(1) transfer of a partnership interest in the
partnership to a person or spouse of a person related within the
third degree of kindred according to the rules of civil law to
the person making the transfer or to a family farm trust of
which the partner, spouse, or related person is a current
beneficiary; or
(2) distribution from a family farm trust of a partnership
interest to a beneficiary related within the third degree of
kindred according to the rules of civil law to a majority of the
current beneficiaries of the trust, or to a family farm trust of
which the partner, spouse, or related person is a current
beneficiary.
For the purposes of this section, a transfer may be made
with or without consideration, either directly or indirectly,
during life or at death, whether or not in trust, of a
partnership interest in the family farm partnership, and
interest owned by a family farm trust is considered to be owned
in equal shares by the current beneficiaries.
(j) (k) "Authorized farm partnership" means a limited
partnership meeting the following standards:
(1) it has been issued a certificate from the secretary of
state or is registered with the county recorder and farming and
ownership of agricultural land is stated as a purpose or
character of the business;
(2) it has no more than five partners;
(3) all its partners, other than any estate, are natural
persons;
(4) its revenue from rent, royalties, dividends, interest,
and annuities do does not exceed 20 percent of its gross
receipts;
(5) its general partners hold at least 51 percent of the
interest in the land assets of the partnership and reside on the
farm or are actively engaging in farming not more than 1,500
acres as a general partner in an authorized limited partnership;
(6) its limited partners do not participate in the business
of the limited partnership including operating, managing, or
directing management of farming operations;
(7) it does not, directly or indirectly, own or otherwise
have an interest in any title to more than 1,500 acres of
agricultural land; and
(8) none of its limited partners are limited partners in
other authorized farm partnerships that directly or indirectly
in combination with the partnership own more than 1,500 acres of
agricultural land.
(l) "Family farm limited liability company" means a limited
liability company founded for the purpose of farming and the
ownership of agricultural land in which the majority of the
membership interests are held by and the majority of the members
are persons or the spouses of persons, or current beneficiaries
of one or more family farm trusts in which the trustee holds
stock in a family farm limited liability company related to each
other within the third degree of kindred according to the rules
of the civil law, at least one of the related persons is
actively operating the farm, and none of the members are
corporations or limited liability companies. A family farm
limited liability company does not cease to qualify as a family
farm limited liability company because of:
(1) a transfer of a membership interest to a person or
spouse of a person related within the third degree of kindred
according to the rules of civil law to the person making the
transfer or to a family farm trust of which the member, spouse,
or related person is a current beneficiary; or
(2) distribution from a family farm trust of a membership
interest to a beneficiary related within the third degree of
kindred according to the rules of civil law to a majority of the
current beneficiaries of the trust, or to a family farm trust of
which the member, spouse, or related person is a current
beneficiary.
For the purposes of this section, a transfer may be made
with or without consideration, either directly or indirectly,
during life or at death, whether or not in trust, of a
membership interest in the family farm limited liability
company, and interest owned by a family farm trust is considered
to be owned in equal shares by the current beneficiaries.
Except for a state or federally chartered financial institution
acquiring an encumbrance for the purpose of security or an
interest under paragraph (x), a member of a family farm limited
liability company may not transfer a membership interest,
including a financial interest, to a person who is not otherwise
eligible to be a member under this paragraph.
(m) "Authorized farm limited liability company" means a
limited liability company meeting the following standards:
(1) it has no more than five members;
(2) all its members, other than any estate, are natural
persons;
(3) it does not have more than one class of membership
interests;
(4) its revenue from rent, royalties, dividends, interest,
and annuities does not exceed 20 percent of its gross receipts;
(5) members holding 51 percent or more of both the
governance rights and financial rights in the limited liability
company reside on the farm or are actively engaged in farming;
(6) it does not, directly or indirectly, own or otherwise
have an interest in any title to more than 1,500 acres of
agricultural land; and
(7) none of its members are members in other authorized
farm limited liability companies that directly or indirectly in
combination with the authorized farm limited liability company
own more than 1,500 acres of agricultural land.
Except for a state or federally chartered financial
institution acquiring an encumbrance for the purpose of security
or an interest under paragraph (x), a member of an authorized
farm limited liability company may not transfer a membership
interest, including a financial interest, to a person who is not
otherwise eligible to be a member under this paragraph.
(k) (n) "Farmer" means a natural person who regularly
participates in physical labor or operations management in the
person's farming operation and files "Schedule F" as part of the
person's annual Form 1040 filing with the United States Internal
Revenue Service.
(l) (o) "Actively engaged in livestock production" means
performing day-to-day physical labor or day-to-day operations
management that significantly contributes to livestock
production and the functioning of a livestock operation.
(m) (p) "Research or experimental farm" means a
corporation, limited partnership, or pension or, investment
fund, or limited liability company that owns or operates
agricultural land for research or experimental purposes,
provided that any commercial sales from the operation are
incidental to the research or experimental objectives of the
corporation. A corporation, limited partnership, limited
liability company, or pension or investment fund seeking initial
approval by the commissioner to operate agricultural land for
research or experimental purposes must first submit to the
commissioner a prospectus or proposal of the intended method of
operation containing information required by the commissioner
including a copy of any operational contract with individual
participants.
(n) (q) "Breeding stock farm" means a corporation or,
limited partnership, or limited liability company, that owns or
operates agricultural land for the purpose of raising breeding
stock, including embryos, for resale to farmers or for the
purpose of growing seed, wild rice, nursery plants, or sod. An
entity that is organized to raise livestock other than dairy
cattle under this paragraph that does not qualify as an
authorized farm corporation must:
(1) sell all castrated animals to be fed out or finished to
farming operations that are neither directly nor indirectly
owned by the business entity operating the breeding stock
operation; and
(2) report its total production and sales annually to the
commissioner.
(o) (r) "Aquatic farm" means a corporation or, limited
partnership, or limited liability company, that owns or leases
agricultural land as a necessary part of an aquatic farm as
defined in section 17.47, subdivision 3.
(p) (s) "Religious farm" means a corporation formed
primarily for religious purposes whose sole income is derived
from agriculture.
(q) (t) "Utility corporation" means a corporation regulated
under Minnesota Statutes 1974, chapter 216B, that owns
agricultural land for purposes described in that chapter, or an
electric generation or transmission cooperative that owns
agricultural land for use in its business if the land is not
used for farming except under lease to a family farm unit, a
family farm corporation, or a family farm trust, a family farm
partnership, or a family farm limited liability company.
(r) "Benevolent trust" means a pension fund or family trust
established by the owners of a family farm, authorized farm
corporation, authorized livestock farm corporation, or family
farm corporation that holds an interest in title to agricultural
land on which one or more of those owners or shareholders have
resided or have been actively engaged in farming as required by
paragraph (b), (c), (d), or (e).
(s) (u) "Development organization" means a corporation,
limited partnership, limited liability company, or pension or
investment fund that owns has an interest in agricultural land
for which the corporation, limited partnership, limited
liability company, or pension or investment fund has documented
plans to use and subsequently uses the land within six years
from the date of purchase for a specific nonfarming purpose, or
if the land is zoned nonagricultural, or if the land is located
within an incorporated area. A corporation, limited
partnership, limited liability company, or pension or investment
fund may hold agricultural land in the amount necessary for its
nonfarm business operation; provided, however, that pending the
development of agricultural land for nonfarm purposes, the land
may not be used for farming except under lease to a family farm
unit, a family farm corporation, a family farm trust, an
authorized farm corporation, an authorized livestock farm
corporation, a family farm partnership, or an authorized farm
partnership, a family farm limited liability company, or an
authorized farm limited liability company, or except when
controlled through ownership, options, leaseholds, or other
agreements by a corporation that has entered into an agreement
with the United States under the New Community Act of 1968
(Title IV of the Housing and Urban Development Act of 1968,
United States Code, title 42, sections 3901 to 3914) as amended,
or a subsidiary or assign of such a corporation.
(t) (v) "Exempt land" means agricultural land owned or
leased by a corporation as of May 20, 1973, agricultural land
owned or leased by a pension or investment fund as of May 12,
1981, or agricultural land owned or leased by a limited
partnership as of May 1, 1988, or agricultural land owned or
leased by a trust as of the effective date of this act,
including the normal expansion of that ownership at a rate not
to exceed 20 percent of the amount of land owned as of May 20,
1973, for a corporation; May 12, 1981, for a pension or
investment fund; or May 1, 1988, for a limited partnership, or
the effective date of this act for a trust, measured in acres,
in any five-year period, and including additional ownership
reasonably necessary to meet the requirements of pollution
control rules. A corporation, limited partnership, or pension
or investment fund that is eligible to own or lease agricultural
land under this section prior to May 1997, or a corporation that
is eligible to own or lease agricultural land as a benevolent
trust under this section prior to the effective date of this
act, may continue to own or lease agricultural land subject to
the same conditions and limitations as previously allowed.
(u) (w) "Gifted land" means agricultural land acquired as a
gift, either by grant or devise, by an educational, religious,
or charitable nonprofit corporation, limited
partnership, limited liability company, or pension or investment
fund if all land so acquired is disposed of within ten years
after acquiring the title.
(v) (x) "Repossessed land" means agricultural land acquired
by a corporation, limited partnership, limited liability
company, or pension or investment fund by process of law in the
collection of debts, or by any procedure for the enforcement of
a lien or claim on the land, whether created by mortgage or
otherwise if all land so acquired is disposed of within five
years after acquiring the title. The five-year limitation is a
covenant running with the title to the land against any grantee,
assignee, or successor of the pension or investment fund,
corporation, or limited partnership, or limited liability
company. The land so acquired must not be used for farming
during the five-year period, except under a lease to a family
farm unit, a family farm corporation, an authorized farm
corporation, an authorized livestock farm corporation, a family
farm partnership, or an authorized farm partnership, a family
farm limited liability company, or an authorized farm limited
liability company. Notwithstanding the five-year divestiture
requirement under this paragraph, a financial institution may
continue to own the agricultural land if the agricultural land
is leased to the immediately preceding former owner, but must
dispose of the agricultural land within ten years of acquiring
the title. Livestock acquired by a pension or investment fund,
corporation, or limited partnership, or limited liability
company in the collection of debts, or by a procedure for the
enforcement of lien or claim on the livestock whether created by
security agreement or otherwise after August 1, 1994, must be
sold or disposed of within one full production cycle for the
type of livestock acquired or 18 months after the livestock is
acquired, whichever is later earlier.
(w) (y) "Commissioner" means the commissioner of
agriculture.
(x) (z) "Demonstration "Nonprofit corporation" means a
nonprofit corporation organized under state nonprofit
corporation law and formed primarily for the purpose of
demonstrating historical farming practices or qualified for
tax-exempt status under federal tax law that uses the land for a
specific nonfarming purpose or leases the agricultural land to a
family farm unit, a family farm corporation, an authorized farm
corporation, an authorized livestock farm corporation, a family
farm limited liability company, an authorized farm limited
liability company, a family farm partnership, or an authorized
farm partnership.
(aa) "Current beneficiary" means a person who at any time
during a year is entitled to, or at the discretion of any person
may, receive a distribution from the income or principal of the
trust. It does not include a distributee trust, other than a
trust described in section 170(c) of the Internal Revenue Code,
as amended, but does include the current beneficiaries of the
distributee trust. It does not include a person in whose favor
a power of appointment could be exercised until the holder of
the power of appointment actually exercises the power of
appointment in that person's favor. It does not include a
person who is entitled to receive a distribution only after a
specified time or upon the occurrence of a specified event until
the time or occurrence of the event. For the purposes of this
section, a distributee trust is a current beneficiary of a
family farm trust.
(bb) "De minimis" means that any corporation, pension or
investment fund, limited liability company, or limited
partnership that directly or indirectly owns, acquires, or
otherwise obtains any interest in 40 acres or less of
agricultural land and annually receives less than $150 per acre
in gross revenue from rental or agricultural production.
Sec. 68. Minnesota Statutes 1999 Supplement, section
500.24, subdivision 3, is amended to read:
Subd. 3. [FARMING AND OWNERSHIP OF AGRICULTURAL LAND BY
CORPORATIONS RESTRICTED.] (a) No corporation, limited liability
company, pension or investment fund, trust, or limited
partnership shall engage in farming; nor shall any corporation,
limited liability company, pension or investment fund, trust, or
limited partnership, directly or indirectly, own, acquire, or
otherwise obtain any interest, in agricultural land other than a
bona fide encumbrance taken for purposes of security. This
subdivision does not apply to general partnerships. This
subdivision does not apply to any agricultural land,
corporation, limited partnership, trust, limited liability
company, or pension or investment fund that meet any of the
definitions in subdivision 2, paragraphs (b)
to (e) (f), (i), (j) to (m), (m) to (v) (p) to (x), and
(x) (z), and (bb), has a conservation plan prepared for the
agricultural land, and reports as required under subdivision 4.
(b) A corporation, pension or investment fund, trust,
limited liability company, or limited partnership that cannot
meet any of the definitions in subdivision 2, paragraphs (b) to
(f), (j) to (m), (p) to (x), (z), and (bb), may petition the
commissioner for an exemption from this subdivision. The
commissioner may issue an exemption if the entity meets the
following criteria:
(1) the exemption would not contradict the purpose of this
section; and
(2) the petitioning entity would not have a significant
impact upon the agriculture industry and the economy.
The commissioner shall review annually each entity that is
issued an exemption under this paragraph to ensure that the
entity continues to meet the criteria in clauses (1) and (2).
If an entity fails to meet the criteria, the commissioner shall
withdraw the exemption and the entity is subject to enforcement
proceedings under subdivision 5. The commissioner shall submit
a report with a list of each entity that is issued an exemption
under this paragraph to the chairs of the senate and house
agricultural policy committees by October 1 of each year.
Sec. 69. Minnesota Statutes 1998, section 500.24,
subdivision 3a, is amended to read:
Subd. 3a. [LEASE AGREEMENT; CONSERVATION PRACTICE
PROTECTION CLAUSE.] A corporation, pension or investment fund,
or limited partnership, or limited liability company other than
a family farm corporation, an authorized farm corporation, an
authorized livestock farm corporation, a family farm
partnership, or an authorized farm partnership those meeting any
of the definitions in subdivision 2, paragraphs (c) to (f) or
(j) to (m), when leasing farm land to a family farm unit, a
family farm corporation, an authorized farm corporation, an
authorized livestock farm corporation, a family farm
partnership, or an authorized farm partnership, a family farm
limited liability company, or an authorized farm limited
liability company, under provisions of subdivision 2, paragraph
(v) (x), must include within the lease agreement a provision
prohibiting intentional damage or destruction to a conservation
practice on the agricultural land.
Sec. 70. Minnesota Statutes 1998, section 500.24,
subdivision 3b, is amended to read:
Subd. 3b. [PROTECTION OF CONSERVATION PRACTICES.] A
corporation, pension or investment fund, or limited partnership,
or limited liability company other than a family farm
corporation, an authorized farm corporation, an authorized
livestock farm corporation, a family farm partnership, or
authorized farm partnership those meeting any of the definitions
in subdivision 2, paragraphs (c) to (f) or (j) to (m), which,
during the period of time it holds agricultural land under
subdivision 2, paragraph (v) (x), intentionally destroys a
conservation practice as defined in section 103F.401,
subdivision 3, to which the state has made a financial
contribution, must pay the commissioner, for deposit in the
general fund, an amount equal to the state's total contributions
to that conservation practice plus interest from the time of
investment in the conservation practice. Interest must be
calculated at an annual percentage rate of 12 percent.
Sec. 71. Minnesota Statutes 1998, section 500.24,
subdivision 4, is amended to read:
Subd. 4. [REPORTS.] (a) The chief executive officer of
every pension or investment fund, corporation, or limited
partnership, limited liability company, or entity that is
seeking to qualify for an exemption from the commissioner, and
the trustee of a family farm trust that holds any interest in
agricultural land or land used for the breeding, feeding,
pasturing, growing, or raising of livestock, dairy or poultry,
or products thereof, or land used for the production of
agricultural crops or fruit or other horticultural products,
other than a bona fide encumbrance taken for purposes of
security, or which is engaged in farming or proposing to
commence farming in this state after May 20, 1973, shall file
with the commissioner a report containing the following
information and documents:
(1) the name of the pension or investment fund,
corporation, or limited partnership, or limited liability
company and its place of incorporation, certification, or
registration;
(2) the address of the pension or investment plan
headquarters or of the registered office of the corporation in
this state, the name and address of its registered agent in this
state and, in the case of a foreign corporation or, limited
partnership, or limited liability company, the address of its
principal office in its place of incorporation, certification,
or registration;
(3) the acreage and location listed by quarter-quarter
section, township, and county of each lot or parcel of
agricultural land or land used for the keeping or feeding of
poultry in this state owned or leased by the pension or
investment fund, limited partnership, or corporation, or limited
liability company;
(4) the names and addresses of the officers,
administrators, directors, or trustees of the pension or
investment fund, or of the officers, shareholders owning more
than ten percent of the stock, including the percent of stock
owned by each such shareholder, and the members of the board of
directors of the corporation, and the members of the limited
liability company, and the general and limited partners and the
percentage of interest in the partnership by each partner;
(5) the farm products which the pension or investment fund,
limited partnership, or corporation, or limited liability
company produces or intends to produce on its agricultural land;
(6) with the first report, a copy of the title to the
property where the farming operations are or will occur
indicating the particular exception claimed under subdivision 3;
and
(7) with the first or second report, a copy of the
conservation plan proposed by the soil and water conservation
district, and with subsequent reports a statement of whether the
conservation plan was implemented.
The report of a corporation, trust, limited liability
company, or partnership seeking to qualify hereunder as a family
farm corporation, an authorized farm corporation, an authorized
livestock farm corporation, a family farm partnership, or an
authorized farm partnership, a family farm limited liability
company, an authorized farm limited liability company, or a
family farm trust or under an exemption from the commissioner
shall contain the following additional information: the number
of shares or the, partnership interests, or governance and
financial rights owned by persons or current beneficiaries of a
family farm trust residing on the farm or actively engaged in
farming, or their relatives within the third degree of kindred
according to the rules of the civil law or their spouses; the
name, address, and number of shares owned by each
shareholder or, partnership interests owned by each partner; or
governance and financial rights owned by each member, and a
statement as to percentage of gross receipts of the corporation
derived from rent, royalties, dividends, interest, and
annuities. No pension or investment fund, limited
partnership, or corporation, or limited liability company shall
commence farming in this state until the commissioner has
inspected the report and certified that its proposed operations
comply with the provisions of this section.
(b) Every pension or investment fund, limited
partnership, trust, or corporation, or limited liability company
as described in paragraph (a) shall, prior to April 15 of each
year, file with the commissioner a report containing the
information required in paragraph (a), based on its operations
in the preceding calendar year and its status at the end of the
year. A pension or investment fund, limited partnership, or
corporation, or limited liability company that does not file the
report by April 15 must pay a $500 civil penalty. The penalty
is a lien on the land being farmed under subdivision 3 until the
penalty is paid.
(c) The commissioner may, for good cause shown, issue a
written waiver or reduction of the civil penalty for failure to
make a timely filing of the annual report required by this
subdivision. The waiver or reduction is final and conclusive
with respect to the civil penalty, and may not be reopened or
modified by an officer, employee, or agent of the state, except
upon a showing of fraud or malfeasance or misrepresentation of a
material fact. The report required under paragraph (b) must be
completed prior to a reduction or waiver under this paragraph.
The commissioner may enter into an agreement under this
paragraph only once for each corporation or partnership.
(d) Failure to file a required report or the willful filing
of false information is a gross misdemeanor.
Sec. 72. Minnesota Statutes 1998, section 500.24,
subdivision 5, is amended to read:
Subd. 5. [ENFORCEMENT.] With reason to believe that a
corporation, limited partnership, limited liability company,
trust, or pension or investment fund is violating subdivision 3,
the attorney general shall commence an action in the district
court in which any agricultural lands relative to such violation
are situated, or if situated in two or more counties, in any
county in which a substantial part of the lands are situated.
The attorney general shall file for record with the county
recorder or the registrar of titles of each county in which any
portion of said lands are located a notice of the pendency of
the action as provided in section 557.02. If the court finds
that the lands in question are being held in violation of
subdivision 3, it shall enter an order so declaring. The
attorney general shall file for record any such order with the
county recorder or the registrar of titles of each county in
which any portion of said lands are located. Thereafter, the
pension or investment fund, limited partnership, or corporation
owning such land shall have a period of five years from the date
of such order to divest itself of such lands. The
aforementioned five-year limitation period shall be deemed a
covenant running with the title to the land against any pension
or investment fund, limited partnership, or corporate grantee or
assignee or the successor of such pension or investment fund,
limited partnership, or corporation. Any lands not so divested
within the time prescribed shall be sold at public sale in the
manner prescribed by law for the foreclosure of a mortgage by
action. In addition, any prospective or threatened violation
may be enjoined by an action brought by the attorney general in
the manner provided by law.
Sec. 73. Minnesota Statutes 1999 Supplement, section
500.245, subdivision 1, is amended to read:
Subdivision 1. [DISPOSAL OF LAND.] (a) A state or federal
agency, limited partnership, or a corporation, or limited
liability company may not lease or sell agricultural land or a
farm homestead before offering or making a good faith effort to
offer the land for sale or lease to the immediately preceding
former owner at a price no higher than the highest price offered
by a third party that is acceptable to the seller or lessor.
The offer must be made on the notice to offer form under
subdivision 2. The requirements of this subdivision do not
apply to a sale or lease by a corporation that is a family farm
corporation or an authorized farm corporation or to a sale or
lease by the commissioner of agriculture of property acquired by
the state under the family farm security program under chapter
41. This subdivision applies only to a sale or lease when the
seller or lessor acquired the property by enforcing a debt
against the agricultural land or farm homestead, including
foreclosure of a mortgage, accepting a deed in lieu of
foreclosure, terminating a contract for deed, or accepting a
deed in lieu of terminating a contract for deed. Selling or
leasing property to a third party at a price is prima facie
evidence that the price is acceptable to the seller or lessor.
The seller must provide written notice to the immediately
preceding former owner that the agricultural land or farm
homestead will be offered for sale at least 14 days before the
agricultural land or farm homestead is offered for sale.
(b) An immediately preceding former owner is the entity
with record legal title to the agricultural land or farm
homestead before acquisition by the state or federal agency or
corporation except: if the immediately preceding former owner
is a bankruptcy estate, the debtor in bankruptcy is the
immediately preceding former owner; and if the agricultural land
or farm homestead was acquired by termination of a contract for
deed or deed in lieu of termination of a contract for deed, the
immediately preceding former owner is the purchaser under the
contract for deed. For purposes of this subdivision, only a
family farm, family farm corporation, or family farm partnership
or family farm limited liability company can be an immediately
preceding former owner.
(c) An immediately preceding former owner may elect to
purchase or lease the entire property or an agreed to portion of
the property. If the immediately preceding former owner elects
to purchase or lease a portion of the property, the election
must be reported in writing to the seller or lessor prior to the
time the property is first offered for sale or lease. If
election is made to purchase or lease a portion of the property,
the portion must be contiguous and compact so that it does not
unreasonably reduce access to or the value of the remaining
property.
(d) For purposes of this subdivision, the term "a price no
higher than the highest price offered by a third party" means
the acceptable cash price offered by a third party or the
acceptable time-price offer made by a third party. A cash price
offer is one that involves simultaneous transfer of title for
payment of the entire amount of the offer. If the acceptable
offer made by a third party is a time-price offer, the seller or
lessor must make the same time-price offer or an equivalent cash
offer to the immediately preceding former owner. An equivalent
cash offer is equal to the total of the payments made over a
period of the time-price offer discounted by yield curve of the
United States treasury notes and bonds of similar maturity on
the first business day of the month in which the offer is
personally delivered or mailed for time periods similar to the
time period covered by the time-price offer, plus 2.0 percent.
A time-price offer is an offer that is financed entirely or
partially by the seller and includes an offer to purchase under
a contract for deed or mortgage. An equivalent cash offer is
not required to be made if the state participates in an offer to
a third party through the rural finance authority.
(e) This subdivision applies to a seller when the property
is sold and to a lessor each time the property is leased, for
the time period specified in section 500.24, subdivision 2,
paragraph (v), after the agricultural land is acquired except:
(1) an offer to lease to the immediately preceding former
owner is required only until the immediately preceding owner
fails to accept an offer to lease the property or the property
is sold;
(2) an offer to sell to the immediately preceding former
owner is required until the property is sold; and
(3) if the immediately preceding former owner elects to
lease or purchase a portion of the property, this subdivision
does not apply to the seller with regard to the balance of the
property after the election is made under paragraph (c).
(f) The notice of an offer under subdivision 2 that is
personally delivered with a signed receipt or sent by certified
mail with a receipt of mailing to the immediately preceding
former owner's last known address is a good faith offer.
(g) This subdivision does not apply to a sale or lease that
occurs after the seller or lessor has held the property for the
time period specified in section 500.24, subdivision 2,
paragraph (v) (x).
(h) For purposes of this subdivision, if the immediately
preceding former owner is a bankruptcy estate the debtor in the
bankruptcy is the immediately preceding owner.
(i) The immediately preceding former owner must exercise
the right to lease all or a portion of the agricultural land or
a homestead located on agricultural land in writing within 15
days after an offer to lease under this subdivision is mailed
with a receipt of mailing or personally delivered. If election
is made to lease only the homestead or a portion of the
agricultural land, the portion to be leased must be clearly
identified in writing. The immediately preceding former owner
must exercise the right to buy the agricultural land, a portion
of the agricultural land, or a farm homestead located on
agricultural land, in writing, within 65 days after an offer to
buy under this subdivision is mailed with a receipt of mailing
or is personally delivered. Within ten days after exercising
the right to lease or buy by accepting the offer, the
immediately preceding owner must fully perform according to the
terms of the offer including paying the amounts due. A seller
may sell and a lessor may lease the agricultural land or farm
homestead subject to this subdivision to the third party in
accordance with their lease or purchase agreement if:
(1) the immediately preceding former owner does not accept
an offer to lease or buy before the offer terminates; or
(2) the immediately preceding former owner does not perform
the obligations of the offer, including paying the amounts due,
within ten days after accepting the offer.
(j) A certificate indicating whether or not the property
contains agricultural land or a farm homestead that is signed by
the county assessor where the property is located and recorded
in the office of the county recorder or the registrar of titles
where the property is located is prima facie evidence of whether
the property is agricultural land or a farm homestead.
(k) As prima facie evidence that an offer to sell or lease
agricultural land or a farm homestead has terminated, a receipt
of mailing the notice under subdivision 2 and an affidavit,
signed by a person authorized to act on behalf of a state,
federal agency, or corporation selling or leasing the
agricultural land or a farm homestead may be filed in the office
of the county recorder or registrar of titles of the county
where the agricultural land or farm homestead is located. The
affidavit must state that:
(1) notice of an offer to buy or lease the agricultural
land or farm homestead was provided to the immediately preceding
former owner at a price not higher than the highest price
offered by a third party that is acceptable;
(2) the time during which the immediately preceding former
owner is required to exercise the right to buy or lease the
agricultural land or farm homestead has expired;
(3) the immediately preceding former owner has not
exercised the right to buy or lease the agricultural land or
farm homestead as provided in this subdivision or has accepted
an offer and has not fully performed according to the terms of
the offer; and
(4) the offer to the immediately preceding former owner has
terminated.
(l) The right of an immediately preceding former owner to
receive an offer to lease or purchase agricultural land under
this subdivision or to lease or purchase at a price no higher
than the highest price offered by a third party that is
acceptable to the seller or lessor may be extinguished or
limited by an express statement signed by the immediately
preceding owner that complies with the plain language
requirements of section 325G.31. The right may not be
extinguished or limited except by:
(1) an express statement in a deed in lieu of foreclosure
of the agricultural land;
(2) an express statement in a deed in lieu of a termination
of a contract for deed for the agricultural land;
(3) an express statement conveying the right to the state
or federal agency or corporation owning the agricultural land
that is required to make an offer under this subdivision;
however, the preceding former owner may rescind the conveyance
by notifying the state or federal agency or corporation in
writing within 20 calendar days after signing the express
statement;
(4) to cure a title defect, an express statement conveying
the right may be made to a person to whom the agricultural land
has been transferred by the state or federal agency or
corporation; or
(5) an express statement conveying the right to a contract
for deed vendee to whom the agricultural land or farm homestead
was sold under a contract for deed by the immediately preceding
former owner if the express statement and the contract for deed
are recorded.
(m) The right of an immediately preceding former owner to
receive an offer to lease or purchase agricultural land under
this subdivision may not be assigned or transferred except as
provided in paragraph (l), but may be inherited.
(n) An immediately preceding former owner, except a former
owner who is actively engaged in farming as defined in section
500.24, subdivision 2, paragraph (a), and who agrees to remain
actively engaged in farming on a portion of the agricultural
land or farm homestead for at least one year after accepting an
offer under this subdivision, may not sell agricultural land
acquired by accepting an offer under this subdivision if the
arrangement of the sale was negotiated or agreed to prior to the
former owner accepting the offer under this subdivision. A
person who sells property in violation of this paragraph is
liable for damages plus reasonable attorney fees to a person who
is damaged by a sale in violation of this paragraph. There is a
rebuttable presumption that a sale by an immediately preceding
former owner is in violation of this paragraph if the sale takes
place within 270 days of the former owner accepting the offer
under this subdivision. This paragraph does not apply to a sale
by an immediately preceding former owner to the owner's spouse,
the owner's parents, the owner's sisters and brothers, the
owner's spouse's sisters and brothers, or the owner's children.
Sec. 74. Minnesota Statutes 1998, section 500.245,
subdivision 2, is amended to read:
Subd. 2. [NOTICE OF OFFER.] (a) The state, a federal
agency, limited partnership, or a corporation, or limited
liability company subject to subdivision 1 must provide a notice
of an offer to sell or lease agricultural land substantially as
follows, after inserting the appropriate terms within the
parentheses:
"NOTICE OF OFFER TO (LEASE, BUY) AGRICULTURAL LAND
TO: (...Immediately preceding former owner...)
FROM: (...The state, federal agency, limited
partnership, or corporation, or limited
liability company subject to
subdivision 1...)
DATE: (...date notice is mailed or personally
delivered...)
(...The state, federal agency, limited partnership, or
corporation, or limited liability company...) HAS ACQUIRED THE
AGRICULTURAL LAND DESCRIBED BELOW AND HAS RECEIVED AN ACCEPTABLE
OFFER TO (LEASE, SELL) THE AGRICULTURAL LAND FROM ANOTHER
PARTY. UNDER MINNESOTA STATUTES, SECTION 500.245, SUBDIVISION
1, AN OFFER FROM (...the state, federal agency, limited
partnership, or corporation, or limited liability company...)
MUST BE MADE TO YOU AT A PRICE NO HIGHER THAN THE HIGHEST OFFER
MADE BY ANOTHER PARTY.
THE AGRICULTURAL LAND BEING OFFERED CONTAINS APPROXIMATELY
(...approximate number of acres...) ACRES AND IS INFORMALLY
DESCRIBED AS FOLLOWS:
(Informal description of the agricultural land being
offered that reasonably describes the land. This description
does not need to be a legal description.)
(...The state, federal agency, limited partnership, or
corporation, or limited liability company...) OFFERS TO (SELL,
LEASE) THE AGRICULTURAL LAND DESCRIBED ABOVE FOR A CASH PRICE OF
$(...cash price or equivalent cash price for lease and lease
period, or cash price or equivalent cash price for sale of
land...), WHICH IS NOT HIGHER THAN THE PRICE OFFERED BY ANOTHER
PARTY. THE PRICE IS OFFERED ON THE FOLLOWING TERMS:
(Terms, if any, of acceptable offer)
IF YOU WANT TO ACCEPT THIS OFFER YOU MUST NOTIFY (...the
state, federal agency, limited partnership, or corporation, or
limited liability company...) IN WRITING THAT YOU ACCEPT THE
OFFER OR SIGN UNDERNEATH THE FOLLOWING PARAGRAPH AND RETURN A
COPY OF THIS NOTICE BY (15 for a lease, 65 for a sale) DAYS
AFTER THIS NOTICE IS PERSONALLY DELIVERED OR MAILED TO YOU. THE
OFFER IN THIS NOTICE TERMINATES ON (...date of termination - 15
days for lease and 65 days for sale after date of mailing or
personal delivery...)
ACCEPTANCE OF OFFER
I ACCEPT THE OFFER TO (BUY, LEASE) THE AGRICULTURAL LAND
DESCRIBED ABOVE AT THE PRICE OFFERED TO ME IN THIS NOTICE. AS
PART OF ACCEPTING THIS OFFER I WILL PERFORM ACCORDING TO THE
TERMS OF THE OFFER, INCLUDING MAKING PAYMENTS DUE UNDER THE
OFFER, WITHIN TEN DAYS AFTER THE DATE I ACCEPT THIS OFFER. I
UNDERSTAND THAT NEGOTIATING OR AGREEING TO AN ARRANGEMENT TO
SELL THE AGRICULTURAL LAND TO ANOTHER PERSON PRIOR TO ACCEPTING
THIS OFFER MAY BE A VIOLATION OF LAW AND I MAY BE LIABLE TO A
PERSON DAMAGED BY THE SALE.
.........................................
Signature of Former Owner Accepting Offer
.........................................
Date"
IMPORTANT NOTICE
ANY ACTION FOR THE RECOVERY OF THE AGRICULTURAL LAND
DESCRIBED ABOVE OR ANY ACTION FOR DAMAGES, EXCEPT FOR DAMAGES
FOR FRAUD, REGARDING THIS OFFER MUST BE COMMENCED BY A LAWSUIT
BEFORE THE EXPIRATION OF THREE YEARS AFTER THIS LAND IS SOLD TO
ANOTHER PARTY. UPON FILING A LAWSUIT, YOU MUST ALSO FILE A
NOTICE OF LIS PENDENS WITH THE COUNTY RECORDER OR REGISTRAR OF
TITLES IN THE COUNTY WHERE THE LAND IS LOCATED.
(b) For an offer to sell, a copy of the purchase agreement
containing the price and terms of the highest offer made by a
third party that is acceptable to the seller and a signed
affidavit by the seller affirming that the purchase agreement is
true, accurate, and made in good faith must be included with the
notice under this subdivision. At the seller's discretion,
reference to the third party's identity may be deleted from the
copy of the purchase agreement.
(c) For an offer to lease, a copy of the lease containing
the price and terms of the highest offer made by a third party
that is acceptable to the lessor and a signed affidavit by the
lessor affirming that the lease is true, accurate, and made in
good faith must be included with the notice under this
subdivision. At the lessor's discretion, reference to the third
party's identity may be deleted from the copy of the lease
agreement.
(d) The affidavit under paragraphs (b) and (c) is subject
to section 609.48.
Sec. 75. [SEED POTATOES; CLEARWATER COUNTY.]
Notwithstanding the seed potato certification requirements
under Minnesota Statutes, section 21.1196, in calendar year
2000, seed potatoes may be planted in Clearwater county without
certification if the seed potatoes have had at least field
inspection as required for certified seed potatoes, have passed
the field inspection standards of disease tolerance, and are
free from ring rot.
Sec. 76. [EFFECTIVE DATE.]
Section 22 is effective the day following final enactment
and applies to claims for corrective action costs incurred after
that date. Sections 67 to 74 are effective the day following
final enactment.
Presented to the governor May 11, 2000
Signed by the governor May 15, 2000, 10:53 a.m.
Official Publication of the State of Minnesota
Revisor of Statutes