1.1                          A bill for an act 
  1.2             relating to taxation; property; prohibiting an 
  1.3             increase in estimated market value for homesteads 
  1.4             owned by persons at least 65 years of age and within 
  1.5             certain income limits; amending Minnesota Statutes 
  1.6             2002, sections 273.11, subdivision 5, by adding a 
  1.7             subdivision; 273.121; 276.04, subdivision 2. 
  1.8   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.9      Section 1.  Minnesota Statutes 2002, section 273.11, 
  1.10  subdivision 5, is amended to read: 
  1.11     Subd. 5.  [BOARDS OF REVIEW AND EQUALIZATION.] 
  1.12  Notwithstanding any other provision of law to the contrary, the 
  1.13  limitation contained in subdivisions 1 ~~and~~, 1a, and 21 shall 
  1.14  also apply to the authority of the local board of review as 
  1.15  provided in section 274.01, the county board of equalization as 
  1.16  provided in section 274.13, the state board of equalization and 
  1.17  the commissioner of revenue as provided in sections 270.11, 
  1.18  270.12 and 270.16. 
  1.19     <b>[EFFECTIVE DATE.]</b> This section is effective for taxes 
  1.20  levied in 2003 and thereafter, payable in 2004 and thereafter. 
  1.21     Sec. 2.  Minnesota Statutes 2002, section 273.11, is 
  1.22  amended by adding a subdivision to read: 
  1.23     Subd. 21.  [HOMESTEADS OF PERSONS AT LEAST AGE 65; 
  1.24  VALUATION INCREASE PROHIBITED.] (a) The market value used for 
  1.25  taxes levied in the current year on class 1 property as defined 
  1.26  in section 273.13, subdivision 22, and that portion of class 2a 
  2.1   property as defined in section 273.13, subdivision 23, 
  2.2   consisting of the house, garage, and surrounding one acre of 
  2.3   land, may not exceed the property's taxable market value used 
  2.4   for taxes levied in the preceding year, if all of the following 
  2.5   conditions are met: 
  2.6      (1) the property must be owned and occupied as a homestead 
  2.7   by a person 65 years of age or older.  In the case of a married 
  2.8   couple, both of the spouses must be at least 65 years old at the 
  2.9   time the application is filed under clause (4) regardless of 
  2.10  whether the property is titled in the name of one spouse or both 
  2.11  spouses, or titled in another way that permits the property to 
  2.12  have homestead status; 
  2.13     (2) the total household income of the qualifying 
  2.14  homeowners, as defined in section 290A.03, subdivision 5, for 
  2.15  the calendar year preceding the year of the initial application 
  2.16  may not exceed $40,000; 
  2.17     (3) the homestead must have been owned and occupied as the 
  2.18  homestead of at least one of the qualifying homeowners for at 
  2.19  least 15 years prior to the year the initial application is 
  2.20  filed; 
  2.21     (4) the owner or owners have applied for a valuation freeze 
  2.22  under this section as required in paragraph (b). 
  2.23     (b) An owner or owners must apply to the county assessor by 
  2.24  September 1 of the levy year for which treatment under paragraph 
  2.25  (a) is first requested.  The applicant or applicants must submit 
  2.26  proof of age and any other information required by the assessor 
  2.27  to determine eligibility for valuation under paragraph (a).  In 
  2.28  succeeding years, applicants must submit whatever information 
  2.29  the county assessor deems necessary to determine the homestead 
  2.30  status and continued eligibility under this section. 
  2.31     (c) An owner whose household income exceeds $40,000 for two 
  2.32  consecutive years no longer qualifies for the valuation freeze 
  2.33  under this section.  An owner must notify the assessor in the 
  2.34  year immediately following any year in which the owner's total 
  2.35  household income exceeds $40,000.  The owner will continue to 
  2.36  qualify for the valuation freeze for that year.  If the owner's 
  3.1   total household income in the second year is equal to or less 
  3.2   than $40,000, the owner will continue to qualify.  However, if 
  3.3   the owner's total household income remains over $40,000 in the 
  3.4   second year, the owner will no longer qualify for the valuation 
  3.5   freeze and the taxes on the property will be determined based 
  3.6   upon the property's taxable market value.  If the owner's income 
  3.7   in a subsequent year is less than $40,000, the owner may reapply 
  3.8   for the valuation freeze under this subdivision. 
  3.9      (d) This subdivision does not apply to any increase in 
  3.10  estimated market value attributable to improvements made to the 
  3.11  homestead. 
  3.12     (e) The county assessor shall annually inform the public of 
  3.13  the availability of treatment under this subdivision as part of 
  3.14  the notice published under section 273.121. 
  3.15     (f) Property that is sold or transferred, loses its 
  3.16  homestead classification, or otherwise no longer qualifies for 
  3.17  treatment under this section shall be assessed for the current 
  3.18  levy year as otherwise provided by law. 
  3.19     (g) The property's taxable market value under this section 
  3.20  cannot exceed the assessor's estimated market value of the 
  3.21  property for any year. 
  3.22     <b>[EFFECTIVE DATE.]</b> This section is effective for taxes 
  3.23  levied in 2003 and thereafter, payable in 2004 and thereafter. 
  3.24     Sec. 3.  Minnesota Statutes 2002, section 273.121, is 
  3.25  amended to read: 
  3.26     273.121 [VALUATION OF REAL PROPERTY, NOTICE.] 
  3.27     Any county assessor or city assessor having the powers of a 
  3.28  county assessor, valuing or classifying taxable real property 
  3.29  shall in each year notify those persons whose property is to be 
  3.30  included on the assessment roll that year if the person's 
  3.31  address is known to the assessor, otherwise the occupant of the 
  3.32  property.  The notice shall be in writing and shall be sent by 
  3.33  ordinary mail at least ten days before the meeting of the local 
  3.34  board of appeal and equalization under section 274.01 or the 
  3.35  review process established under section 274.13, subdivision 
  3.36  1c.  It shall contain:  (1) the market value for the current and 
  4.1   prior assessment, (2) the limited market value under section 
  4.2   273.11, subdivision 1a, for the current and prior assessment, (3)
  4.3   the qualifying amount of any improvements under section 273.11, 
  4.4   subdivision 16, for the current assessment, (4) the amount of 
  4.5   any market value increase prohibited under section 273.11, 
  4.6   subdivision 21, (5) the market value subject to taxation after 
  4.7   subtracting the amount of any qualifying improvements under 
  4.8   clause (3) or any senior citizen's freeze amount under clause 
  4.9   (4) for the current assessment, ~~(5)~~ (6) the classification of 
  4.10  the property for the current and prior assessment, ~~(6)~~ (7) a 
  4.11  note that if the property is homestead and at least 45 years 
  4.12  old, improvements made to the property may be eligible for a 
  4.13  valuation exclusion under section 273.11, subdivision 
  4.14  16, ~~(7)~~ (8) the assessor's office address, and ~~(8)~~ (9) the 
  4.15  dates, places, and times set for the meetings of the local board 
  4.16  of appeal and equalization, the review process established under 
  4.17  section 274.13, subdivision 1c, and the county board of appeal 
  4.18  and equalization.  The commissioner of revenue shall specify the 
  4.19  form of the notice.  The assessor shall attach to the assessment 
  4.20  roll a statement that the notices required by this section have 
  4.21  been mailed.  Any assessor who is not provided sufficient funds 
  4.22  from the assessor's governing body to provide such notices, may 
  4.23  make application to the commissioner of revenue to finance such 
  4.24  notices.  The commissioner of revenue shall conduct an 
  4.25  investigation and, if satisfied that the assessor does not have 
  4.26  the necessary funds, issue a certification to the commissioner 
  4.27  of finance of the amount necessary to provide such notices.  The 
  4.28  commissioner of finance shall issue a warrant for such amount 
  4.29  and shall deduct such amount from any state payment to such 
  4.30  county or municipality.  The necessary funds to make such 
  4.31  payments are hereby appropriated.  Failure to receive the notice 
  4.32  shall in no way affect the validity of the assessment, the 
  4.33  resulting tax, the procedures of any board of review or 
  4.34  equalization, or the enforcement of delinquent taxes by 
  4.35  statutory means. 
  4.36     <b>[EFFECTIVE DATE.]</b> This section is effective for valuation 
  5.1   notices beginning with the 2004 assessment. 
  5.2      Sec. 4.  Minnesota Statutes 2002, section 276.04, 
  5.3   subdivision 2, is amended to read: 
  5.4      Subd. 2.  [CONTENTS OF TAX STATEMENTS.] (a) The treasurer 
  5.5   shall provide for the printing of the tax statements.  The 
  5.6   commissioner of revenue shall prescribe the form of the property 
  5.7   tax statement and its contents.  The statement must contain a 
  5.8   tabulated statement of the dollar amount due to each taxing 
  5.9   authority and the amount of the state tax from the parcel of 
  5.10  real property for which a particular tax statement is prepared.  
  5.11  The dollar amounts attributable to the county, the state tax, 
  5.12  the voter approved school tax, the other local school tax, the 
  5.13  township or municipality, and the total of the metropolitan 
  5.14  special taxing districts as defined in section 275.065, 
  5.15  subdivision 3, paragraph (i), must be separately stated.  The 
  5.16  amounts due all other special taxing districts, if any, may be 
  5.17  aggregated.  If the county levy under this paragraph includes an 
  5.18  amount for a lake improvement district as defined under sections 
  5.19  103B.501 to 103B.581, the amount attributable for that purpose 
  5.20  must be separately stated from the remaining county levy 
  5.21  amount.  The amount of the tax on homesteads qualifying under 
  5.22  the senior citizens' property tax deferral program under chapter 
  5.23  290B is the total amount of property tax before subtraction of 
  5.24  the deferred property tax amount.  The amount of the tax on 
  5.25  contamination value imposed under sections 270.91 to 270.98, if 
  5.26  any, must also be separately stated.  The dollar amounts, 
  5.27  including the dollar amount of any special assessments, may be 
  5.28  rounded to the nearest even whole dollar.  For purposes of this 
  5.29  section whole odd-numbered dollars may be adjusted to the next 
  5.30  higher even-numbered dollar.  The amount of market value 
  5.31  excluded under section 273.11, subdivision 16, if any, must also 
  5.32  be listed on the tax statement. 
  5.33     (b) The property tax statements for manufactured homes and 
  5.34  sectional structures taxed as personal property shall contain 
  5.35  the same information that is required on the tax statements for 
  5.36  real property.  
  6.1      (c) Real and personal property tax statements must contain 
  6.2   the following information in the order given in this paragraph.  
  6.3   The information must contain the current year tax information in 
  6.4   the right column with the corresponding information for the 
  6.5   previous year in a column on the left: 
  6.6      (1) the property's estimated market value under section 
  6.7   273.11, subdivision 1; 
  6.8      (2) the property's taxable market value after reductions 
  6.9   under section 273.11, subdivisions 1a ~~and~~, 16, and 21; 
  6.10     (3) the property's gross tax, calculated by adding the 
  6.11  property's total property tax to the sum of the aids enumerated 
  6.12  in clause (4); 
  6.13     (4) a total of the following aids: 
  6.14     (i) education aids payable under chapters 122A, 123A, 123B, 
  6.15  124D, 125A, 126C, and 127A; 
  6.16     (ii) local government aids for cities, towns, and counties 
  6.17  under chapter 477A; 
  6.18     (iii) disparity reduction aid under section 273.1398; and 
  6.19     (iv) homestead and agricultural credit aid under section 
  6.20  273.1398; 
  6.21     (5) for homestead residential and agricultural properties, 
  6.22  the credits under section 273.1384; 
  6.23     (6) any credits received under sections 273.119; 273.123; 
  6.24  273.135; 273.1391; 273.1398, subdivision 4; 469.171; and 
  6.25  473H.10, except that the amount of credit received under section 
  6.26  273.135 must be separately stated and identified as "taconite 
  6.27  tax relief"; and 
  6.28     (7) the net tax payable in the manner required in paragraph 
  6.29  (a). 
  6.30     (d) If the county uses envelopes for mailing property tax 
  6.31  statements and if the county agrees, a taxing district may 
  6.32  include a notice with the property tax statement notifying 
  6.33  taxpayers when the taxing district will begin its budget 
  6.34  deliberations for the current year, and encouraging taxpayers to 
  6.35  attend the hearings.  If the county allows notices to be 
  6.36  included in the envelope containing the property tax statement, 
  7.1   and if more than one taxing district relative to a given 
  7.2   property decides to include a notice with the tax statement, the 
  7.3   county treasurer or auditor must coordinate the process and may 
  7.4   combine the information on a single announcement.  
  7.5      The commissioner of revenue shall certify to the county 
  7.6   auditor the actual or estimated aids enumerated in clause (4) 
  7.7   that local governments will receive in the following year.  The 
  7.8   commissioner must certify this amount by January 1 of each year. 
  7.9      <b>[EFFECTIVE DATE.]</b> This section is effective for property 
  7.10  tax statements for taxes payable in 2004 and thereafter.