1.1 	A bill for an act
1.2 	relating to financing of state and local government; making policy, technical, and 
1.3 	other changes to individual income, corporate franchise, property, sales and 
1.4 	use, special, mineral, liquor, aggregate materials, gross receipts, estate, local, 
1.5 	and other taxes and tax-related provisions; updating references to the Internal 
1.6 	Revenue Code; changing and providing income and franchise tax credits, 
1.7 	exemptions, and deductions; changing income tax withholding requirements; 
1.8 	establishing a veterans jobs tax credit; permitting the filing of certain amended 
1.9 	returns; modifying property tax levies, credits, exemptions, refunds, proposed 
1.10 	levies and property tax notices, and tax statements; providing for use of a local 
1.11 	levy; changing the state general levy; modifying city aid reporting requirements; 
1.12 	modifying tax increment financing district requirements; authorizing, changing, 
1.13 	and extending tax increment financing districts in certain local governments; 
1.14 	changing sales and use tax payment requirements and changing and providing 
1.15 	exemptions; modifying use of revenues and authorizing extension of certain 
1.16 	sales and lodging taxes and other local taxes for certain cities and making other 
1.17 	local tax changes; modifying filing, compliance, and payment requirements 
1.18 	for estate tax returns; modifying requirements for qualified farms and small 
1.19 	business property; modifying definitions and making clarifying, technical, and 
1.20 	other changes relating to the issuance of municipal bonds; authorizing certain 
1.21 	local governments to issue public debt; clarifying limits on taxation, spending, 
1.22 	and incurring debt based on market values; making technical and clarifying 
1.23 	changes, and repealing obsolete provisions related to the homestead market value 
1.24 	credit; changing liquor tax reporting and credits; allocating funds to border city 
1.25 	enterprise zones; changing local standard measures program reimbursement 
1.26 	requirements; requiring certain local budgetary information on local Web sites; 
1.27 	establishing a greater Minnesota internship program; requiring reports; canceling 
1.28 	funds to the general fund from the budget reserve account; appropriating money;
1.29 	amending Minnesota Statutes 2010, sections 6.91, subdivision 2; 13.4965, 
1.30 	subdivision 3; 16A.46; 38.18; 40A.15, subdivision 2; 65B.84, subdivision 1; 
1.31 	69.011, subdivision 1; 69.021, subdivisions 7, 8; 88.51, subdivision 3; 103B.245, 
1.32 	subdivision 3; 103B.251, subdivision 8; 103B.635, subdivision 2; 103B.691, 
1.33 	subdivision 2; 103D.905, subdivisions 2, 3, 8; 116J.8737, subdivisions 5, 8, 
1.34 	by adding a subdivision; 117.025, subdivision 7; 127A.48, subdivision 1; 
1.35 	138.053; 144F.01, subdivision 4; 162.07, subdivisions 3, 4; 163.04, subdivision 
1.36 	3; 163.06, subdivision 6; 165.10, subdivision 1; 270.077; 270.41, subdivision 5; 
1.37 	270C.38, subdivision 1; 270C.42, subdivision 2; 270C.69, subdivision 1; 272.01, 
1.38 	subdivision 2; 272.03, by adding subdivisions; 273.032; 273.11, subdivision 
1.39 	1; 273.113; 273.124, subdivisions 3a, 13; 273.13, subdivision 21b; 273.1315, 
2.1 	subdivisions 1, 2; 273.1398, subdivisions 3, 4; 273.19, subdivision 1; 273.372, 
2.2 	subdivision 4; 273.39; 275.011, subdivision 1; 275.025, subdivision 1; 275.065, 
2.3 	subdivisions 1, 3; 275.077, subdivision 2; 275.71, subdivision 4; 276A.01, 
2.4 	subdivisions 10, 12, 13, 15; 279.06, subdivision 1; 287.08; 287.20, by adding 
2.5 	a subdivision; 287.23, subdivision 1; 287.385, subdivision 7; 289A.02, by 
2.6 	adding a subdivision; 289A.10, by adding a subdivision; 289A.12, by adding a 
2.7 	subdivision; 289A.18, by adding a subdivision; 289A.20, subdivisions 3, 4, by 
2.8 	adding a subdivision; 289A.26, subdivisions 3, 4, 7, 9; 289A.38, subdivisions 
2.9 	7, 8, 9; 289A.42, subdivision 2; 289A.55, subdivision 9; 289A.60, subdivisions 
2.10 	4, 24; 290.01, subdivisions 6b, 19d; 290.068, subdivision 1; 290.0681, 
2.11 	subdivisions 1, 3, 4, 5, 10; 290.0921, subdivision 3; 290.17, subdivision 4; 
2.12 	290A.04, subdivision 2h; 290A.25; 290B.04, subdivision 2; 296A.22; 297A.61, 
2.13 	subdivision 4; 297A.665; 297A.68, subdivision 5; 297A.70, subdivision 4, by 
2.14 	adding subdivisions; 297A.815, subdivision 3; 297A.8155; 297E.14, subdivision 
2.15 	7; 297F.01, subdivision 23; 297F.09, subdivision 9; 297F.18, subdivision 7; 
2.16 	297G.04, subdivision 2; 297G.09, subdivision 8; 297G.17, subdivision 7; 
2.17 	297I.05, subdivision 11; 297I.30, by adding a subdivision; 297I.80, subdivision 
2.18 	1; 298.018, subdivision 2; 298.75, by adding a subdivision; 353G.08, subdivision 
2.19 	2; 365.025, subdivision 4; 366.095, subdivision 1; 366.27; 368.01, subdivision 
2.20 	23; 368.47; 370.01; 373.40, subdivisions 1, 2, 4; 375.167, subdivision 1; 375.18, 
2.21 	subdivision 3; 375.555; 383B.152; 383B.245; 383B.73, subdivision 1; 383E.20; 
2.22 	383E.23; 385.31; 394.36, subdivision 1; 398A.04, subdivision 8; 401.05, 
2.23 	subdivision 3; 410.32; 412.221, subdivision 2; 412.301; 428A.02, subdivision 1; 
2.24 	430.102, subdivision 2; 447.10; 450.19; 450.25; 458A.10; 458A.31, subdivision 
2.25 	1; 465.04; 469.033, subdivision 6; 469.034, subdivision 2; 469.053, subdivisions 
2.26 	4, 4a, 6; 469.107, subdivision 1; 469.169, by adding a subdivision; 469.174, 
2.27 	subdivisions 2, 10, by adding subdivisions; 469.175, subdivision 3; 469.176, 
2.28 	subdivisions 1b, 4b, by adding a subdivision; 469.1763, subdivisions 3, 4; 
2.29 	469.180, subdivision 2; 469.187; 469.206; 471.24; 471.571, subdivisions 1, 
2.30 	2; 471.73; 473.325, subdivision 2; 473.629; 473.661, subdivision 3; 473.667, 
2.31 	subdivision 9; 473.671; 473.711, subdivision 2a; 473F.02, subdivisions 12, 
2.32 	14, 15, 23; 474A.02, subdivision 23a; 474A.04, subdivision 1a; 474A.062; 
2.33 	474A.091, subdivision 3a; 475.521, subdivisions 2, 4; 475.53, subdivisions 1, 3, 
2.34 	4; 475.58, subdivisions 2, 3b; 475.73, subdivision 1; 477A.011, subdivision 32; 
2.35 	477A.0124, subdivision 2; 477A.017, subdivision 3; 641.23; 641.24; 645.44, by 
2.36 	adding a subdivision; Minnesota Statutes 2011 Supplement, sections 116J.8737, 
2.37 	subdivisions 1, 2; 270C.34, subdivision 1; 270C.991, subdivision 4, as amended; 
2.38 	272.02, subdivision 97; 273.114, subdivision 6; 273.13, subdivision 25; 276.04, 
2.39 	subdivision 2; 289A.02, subdivision 7; 290.01, subdivisions 19, 19b, 19c, 31; 
2.40 	290A.03, subdivision 15; 291.005, subdivision 1; 291.03, subdivisions 8, 9, 10, 
2.41 	11; 295.53, subdivision 1; 297A.68, subdivision 42; 297I.05, subdivisions 7, 12; 
2.42 	297I.30, subdivisions 1, 2; 298.01, subdivision 3; 373.01, subdivision 1; 469.176, 
2.43 	subdivisions 4c, 4m; 469.1763, subdivision 2; 477A.011, subdivision 20; Laws 
2.44 	1971, chapter 773, section 1, subdivision 2, as amended; Laws 1988, chapter 645, 
2.45 	section 3, as amended; Laws 1998, chapter 389, article 8, section 43, subdivision 
2.46 	3, as amended; Laws 1999, chapter 243, article 6, section 11; Laws 2002, chapter 
2.47 	377, article 3, section 25, as amended; Laws 2003, chapter 127, article 12, section 
2.48 	28; Laws 2005, First Special Session chapter 3, article 5, section 37, subdivisions 
2.49 	2, 4; Laws 2008, chapter 366, article 5, section 34, as amended; article 7, section 
2.50 	19, subdivision 3, as amended; Laws 2010, chapter 216, section 11; Laws 2010, 
2.51 	chapter 389, article 1, section 12; proposing coding for new law in Minnesota 
2.52 	Statutes, chapters 136A; 290; 297I; 471; repealing Minnesota Statutes 2010, 
2.53 	sections 168A.40, subdivisions 3, 4; 270C.991, subdivision 5; 272.69; 273.11, 
2.54 	subdivisions 1a, 22; 276A.01, subdivision 11; 276A.06, subdivision 10; 473F.02, 
2.55 	subdivision 13; 473F.08, subdivision 10; 477A.011, subdivision 21; Minnesota 
2.56 	Statutes 2011 Supplement, section 289A.60, subdivision 31; Laws 2009, chapter 
2.57 	88, article 4, section 23, as amended.
3.1 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

3.2 	ARTICLE 1
3.3 	DEPARTMENT POLICY AND TECHNICAL: INCOME AND 
3.4 	CORPORATE FRANCHISE TAXES

3.5 	Section 1. Minnesota Statutes 2010, section 289A.02, is amended by adding a 
3.6 	subdivision to read:
3.7 		Subd. 9.Field audit. "Field audit" means the physical presence of examiners 
3.8 	in the taxpayer's or taxpayer's representative's office conducting an examination of the 
3.9 	taxpayer with the intention of issuing an assessment or notice of change in tax or which 
3.10 	results in the issuing of an assessment or notice of change in tax. The examination may 
3.11 	include inspecting a taxpayer's place of business, tangible personal property, equipment, 
3.12 	computer systems and facilities, pertinent books, records, papers, vouchers, computer 
3.13 	printouts, accounts, and documents. 

3.14 	EFFECTIVE DATE. This section is effective the day following final enactment.

3.15 	Sec. 2. Minnesota Statutes 2010, section 289A.26, subdivision 3, is amended to read:
3.16 		Subd. 3.Short taxable year. (a) A corporation or an entity with a short taxable 
3.17 	year of less than 12 months, but at least four months, must pay estimated tax in equal 
3.18 	installments on or before the 15th day of the third, sixth, ninth, and final month of the 
3.19 	short taxable year, to the extent applicable based on the number of months in the short 
3.20 	taxable year.
3.21 	(b) A corporation or an entity is not required to make estimated tax payments for a 
3.22 	short taxable year unless its tax liability before the first day of the last month of the taxable 
3.23 	year can reasonably be expected to exceed $500.
3.24 	(c) No payment is required for a short taxable year of less than four months.

3.25 	EFFECTIVE DATE. This section is effective the day following final enactment.

3.26 	Sec. 3. Minnesota Statutes 2010, section 289A.26, subdivision 4, is amended to read:
3.27 		Subd. 4.Underpayment of estimated tax. If there is an underpayment of estimated 
3.28 	tax by a corporation or an entity, there shall be added to the tax for the taxable year an 
3.29 	amount determined at the rate in section 270C.40 on the amount of the underpayment, 
3.30 	determined under subdivision 5, for the period of the underpayment determined under 
3.31 	subdivision 6. This subdivision does not apply in the first taxable year that a corporation is 
4.1 	subject to the tax imposed under section 290.02 or an entity is subject to the tax imposed 
4.2 	under section 290.05, subdivision 3.

4.3 	EFFECTIVE DATE. This section is effective the day following final enactment.

4.4 	Sec. 4. Minnesota Statutes 2010, section 289A.26, subdivision 7, is amended to read:
4.5 		Subd. 7.Required installments. (a) Except as otherwise provided in this 
4.6 	subdivision, the amount of a required installment is 25 percent of the required annual 
4.7 	payment.
4.8 	(b) Except as otherwise provided in this subdivision, the term "required annual 
4.9 	payment" means the lesser of:
4.10 	(1) 100 percent of the tax shown on the return for the taxable year, or, if no return is 
4.11 	filed, 100 percent of the tax for that year; or
4.12 	(2) 100 percent of the tax shown on the return of the corporation or entity for the 
4.13 	preceding taxable year provided the return was for a full 12-month period, showed a 
4.14 	liability, and was filed by the corporation or entity.
4.15 	(c) Except for determining the first required installment for any taxable year, 
4.16 	paragraph (b), clause (2), does not apply in the case of a large corporation. The term 
4.17 	"large corporation" means a corporation or any predecessor corporation that had taxable 
4.18 	net income of $1,000,000 or more for any taxable year during the testing period. The 
4.19 	term "testing period" means the three taxable years immediately preceding the taxable 
4.20 	year involved. A reduction allowed to a large corporation for the first installment that is 
4.21 	allowed by applying paragraph (b), clause (2), must be recaptured by increasing the next 
4.22 	required installment by the amount of the reduction.
4.23 	(d) In the case of a required installment, if the corporation or entity establishes that 
4.24 	the annualized income installment is less than the amount determined in paragraph (a), the 
4.25 	amount of the required installment is the annualized income installment and the recapture 
4.26 	of previous quarters' reductions allowed by this paragraph must be recovered by increasing 
4.27 	later required installments to the extent the reductions have not previously been recovered.
4.28 	(e) The "annualized income installment" is the excess, if any, of:
4.29 	(1) an amount equal to the applicable percentage of the tax for the taxable year 
4.30 	computed by placing on an annualized basis the taxable income:
4.31 	(i) for the first two months of the taxable year, in the case of the first required 
4.32 	installment;
4.33 	(ii) for the first two months or for the first five months of the taxable year, in the 
4.34 	case of the second required installment;
5.1 	(iii) for the first six months or for the first eight months of the taxable year, in the 
5.2 	case of the third required installment; and
5.3 	(iv) for the first nine months or for the first 11 months of the taxable year, in the 
5.4 	case of the fourth required installment, over
5.5 	(2) the aggregate amount of any prior required installments for the taxable year.
5.6 	(3) For the purpose of this paragraph, the annualized income shall be computed 
5.7 	by placing on an annualized basis the taxable income for the year up to the end of the 
5.8 	month preceding the due date for the quarterly payment multiplied by 12 and dividing 
5.9 	the resulting amount by the number of months in the taxable year (2, 5, 6, 8, 9, or 11 as 
5.10 	the case may be) referred to in clause (1).
5.11 	(4) The "applicable percentage" used in clause (1) is:

5.12
5.13
5.14		For the following 
required 
installments:
		The applicable
percentage is:
	
5.15			1st
		25
		
5.16			2nd
		50
		
5.17			3rd
		75
		
5.18			4th
		100
		
5.19 	(f)(1) If this paragraph applies, the amount determined for any installment must 
5.20 	be determined in the following manner:
5.21 	(i) take the taxable income for the months during the taxable year preceding the 
5.22 	filing month;
5.23 	(ii) divide that amount by the base period percentage for the months during the 
5.24 	taxable year preceding the filing month;
5.25 	(iii) determine the tax on the amount determined under item (ii); and
5.26 	(iv) multiply the tax computed under item (iii) by the base period percentage for the 
5.27 	filing month and the months during the taxable year preceding the filing month.
5.28 	(2) For purposes of this paragraph:
5.29 	(i) the "base period percentage" for a period of months is the average percent that the 
5.30 	taxable income for the corresponding months in each of the three preceding taxable years 
5.31 	bears to the taxable income for the three preceding taxable years;
5.32 	(ii) the term "filing month" means the month in which the installment is required 
5.33 	to be paid;
5.34 	(iii) this paragraph only applies if the base period percentage for any six consecutive 
5.35 	months of the taxable year equals or exceeds 70 percent; and
6.1 	(iv) the commissioner may provide by rule for the determination of the base period 
6.2 	percentage in the case of reorganizations, new corporations or entities, and other similar 
6.3 	circumstances.
6.4 	(3) In the case of a required installment determined under this paragraph, if the
6.5 	corporation or entity determines that the installment is less than the amount determined in 
6.6 	paragraph (a), the amount of the required installment is the amount determined under this 
6.7 	paragraph and the recapture of previous quarters' reductions allowed by this paragraph 
6.8 	must be recovered by increasing later required installments to the extent the reductions 
6.9 	have not previously been recovered.

6.10 	EFFECTIVE DATE. This section is effective the day following final enactment.

6.11 	Sec. 5. Minnesota Statutes 2010, section 289A.26, subdivision 9, is amended to read:
6.12 		Subd. 9.Failure to file an estimate. In the case of a corporation or an entity 
6.13 	that fails to file an estimated tax for a taxable year when one is required, the period of 
6.14 	the underpayment runs from the four installment dates in subdivision 2 or 3, whichever 
6.15 	applies, to the earlier of the periods in subdivision 6, clauses (1) and (2).

6.16 	EFFECTIVE DATE. This section is effective the day following final enactment.

6.17 	Sec. 6. Minnesota Statutes 2010, section 289A.38, subdivision 7, is amended to read:
6.18 		Subd. 7.Federal tax changes. If the amount of income, items of tax preference, 
6.19 	deductions, or credits for any year of a taxpayer, or the wages paid by a taxpayer for 
6.20 	any period, as reported to the Internal Revenue Service is changed or corrected by the 
6.21 	commissioner of Internal Revenue or other officer of the United States or other competent 
6.22 	authority, or where a renegotiation of a contract or subcontract with the United States 
6.23 	results in a change in income, items of tax preference, deductions, credits, or withholding 
6.24 	tax, or, in the case of estate tax, where there are adjustments to the taxable estate, the 
6.25 	taxpayer shall report the change or correction or renegotiation results in writing to the 
6.26 	commissioner of revenue. The report must be submitted within 180 days after the 
6.27 	final determination and must be in the form of either an amended Minnesota estate, 
6.28 	withholding tax, corporate franchise tax, or income tax return conceding the accuracy of 
6.29 	the federal determination or a letter detailing how the federal determination is incorrect 
6.30 	or does not change the Minnesota tax. An amended Minnesota income tax return must 
6.31 	be accompanied by an amended property tax refund return, if necessary. A taxpayer 
6.32 	filing an amended federal tax return must also file a copy of the amended return with the 
6.33 	commissioner of revenue within 180 days after filing the amended return.

7.1 	EFFECTIVE DATE. This section is effective the day following final enactment.

7.2 	Sec. 7. Minnesota Statutes 2010, section 289A.38, subdivision 8, is amended to read:
7.3 		Subd. 8.Failure to report change or correction of federal return Time 
7.4 	requirement to report federal tax changes. If a taxpayer fails to make a report as 
7.5 	required by subdivision 7, the commissioner may recompute the tax, including a refund, 
7.6 	based on information available to the commissioner. The tax may be recomputed within 
7.7 	six years after the report should have been filed, notwithstanding any period of limitations 
7.8 	to the contrary. A taxpayer must submit the report or file the amended return required by 
7.9 	subdivision 7 within 180 days after the final determination by the commissioner of internal 
7.10 	revenue or other officer of the United States or other competent authority of a change or 
7.11 	correction of the person's federal tax return or the filing of an amended federal tax return.

7.12 	EFFECTIVE DATE. This section is effective the day following final enactment.

7.13 	Sec. 8. Minnesota Statutes 2010, section 289A.38, subdivision 9, is amended to read:
7.14 		Subd. 9.Report made of change or correction of federal return Limitations 
7.15 	on time for assessment for federal tax changes. (a) If a taxpayer is required to make a
7.16 	submits the report under or files the amended return as required by subdivision 7, and does 
7.17 	report the change or files a copy of the amended return at any time within six years after 
7.18 	the time period provided by subdivision 8, the commissioner may recompute and reassess 
7.19 	the tax due, including a refund (1) within one year after the report or amended return is 
7.20 	filed with the commissioner, notwithstanding any period of limitations to the contrary, or 
7.21 	(2) within any other applicable period stated in this section, whichever period is longer. 
7.22 	The period provided for the carryback of any amount of loss or credit is also extended as 
7.23 	provided in this subdivision, notwithstanding any law to the contrary.
7.24 	(b) If a taxpayer fails to submit the report or file the amended return as required by 
7.25 	subdivision 7, the commissioner may recompute the tax, including a refund, based on 
7.26 	information available to the commissioner. The tax may be recomputed within six years 
7.27 	after the time period provided by subdivision 8, notwithstanding any period of limitations 
7.28 	to the contrary.
7.29 	(c) If the commissioner has completed a field audit of the taxpayer, and, but for this 
7.30 	subdivision, the commissioner's time period to adjust the tax has expired, the additional 
7.31 	tax due or refund is limited to only those changes that are required to be made to the 
7.32 	return which relate to the changes made on the federal return. This subdivision does not 
7.33 	apply to sales and use tax.
8.1 	For purposes of this subdivision and section 289A.42, subdivision 2, a "field audit" 
8.2 	is the physical presence of examiners in the taxpayer's or taxpayer's representative's office 
8.3 	conducting an examination of the taxpayer with the intention of issuing an assessment or 
8.4 	notice of change in tax or which results in the issuing of an assessment or notice of change 
8.5 	in tax. The examination may include inspecting a taxpayer's place of business, tangible 
8.6 	personal property, equipment, computer systems and facilities, pertinent books, records, 
8.7 	papers, vouchers, computer printouts, accounts, and documents.

8.8 	EFFECTIVE DATE. This section is effective the day following final enactment.

8.9 	Sec. 9. Minnesota Statutes 2010, section 289A.42, subdivision 2, is amended to read:
8.10 		Subd. 2.Federal extensions. When a taxpayer consents to an extension of time 
8.11 	for the assessment of federal withholding or income taxes, the period in which the 
8.12 	commissioner may recompute the tax is also extended, notwithstanding any period of 
8.13 	limitations to the contrary, as follows:
8.14 	(1) for the periods provided in section 289A.38, subdivisions 8 and 9;
8.15 	(2) for six months following the expiration of the extended federal period of 
8.16 	limitations when no change is made by the federal authority. If no change is made by the 
8.17 	federal authority, and, but for this subdivision, the commissioner's time period to adjust 
8.18 	the tax has expired, and if the commissioner has completed a field audit of the taxpayer, no 
8.19 	additional changes resulting in additional tax due or a refund may be made. For purposes 
8.20 	of this subdivision, "field audit" has the meaning given it in section 289A.38, subdivision 9.

8.21 	EFFECTIVE DATE. This section is effective the day following final enactment.

8.22 	Sec. 10. Minnesota Statutes 2010, section 289A.60, subdivision 24, is amended to read:
8.23 		Subd. 24.Penalty for failure to notify of federal change. If a person fails to 
8.24 	report to the commissioner a change or correction of the person's federal return in the 
8.25 	manner prescribed by section 289A.38, subdivision 7, and within the 180-day time period 
8.26 	prescribed in section 289A.38, subdivision 7 8, there must be added to the tax an amount 
8.27 	equal to ten percent of the amount of any underpayment of Minnesota tax attributable to 
8.28 	the federal change.

8.29 	EFFECTIVE DATE. This section is effective the day following final enactment.

8.30 	Sec. 11. Minnesota Statutes 2010, section 290.01, subdivision 6b, is amended to read:
9.1 		Subd. 6b.Foreign operating corporation. The term "foreign operating 
9.2 	corporation," when applied to a corporation, means a domestic corporation with the 
9.3 	following characteristics:
9.4 	(1) it is part of a unitary business at least one member of which is taxable in this state;
9.5 	(2) it is not a foreign sales corporation under section 922 of the Internal Revenue 
9.6 	Code, as amended through December 31, 1999, for the taxable year;
9.7 	(3) it is not an interest charge domestic international sales corporation under sections 
9.8 	992, 993, 994, and 995 of the Internal Revenue Code;
9.9 	(4) either (i) it has in effect a valid election under section 936 of the Internal Revenue 
9.10 	Code; or (ii) at least 80 percent of the gross income from all sources of the corporation in 
9.11 	the tax year is active foreign business income; and
9.12 	(5) for purposes of this subdivision, active foreign business income means gross 
9.13 	income that is (i) derived from sources without the United States, as defined in subtitle A, 
9.14 	chapter 1, subchapter N, part 1, of the Internal Revenue Code; and (ii) attributable to the 
9.15 	active conduct of a trade or business in a foreign country.

9.16 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
9.17 	December 31, 2011.

9.18 	Sec. 12. Minnesota Statutes 2011 Supplement, section 290.01, subdivision 19b, 
9.19 	is amended to read:
9.20 		Subd. 19b.Subtractions from federal taxable income. For individuals, estates, 
9.21 	and trusts, there shall be subtracted from federal taxable income:
9.22 	(1) net interest income on obligations of any authority, commission, or 
9.23 	instrumentality of the United States to the extent includable in taxable income for federal 
9.24 	income tax purposes but exempt from state income tax under the laws of the United States;
9.25 	(2) if included in federal taxable income, the amount of any overpayment of income 
9.26 	tax to Minnesota or to any other state, for any previous taxable year, whether the amount 
9.27 	is received as a refund or as a credit to another taxable year's income tax liability;
9.28 	(3) the amount paid to others, less the amount used to claim the credit allowed under 
9.29 	section 290.0674, not to exceed $1,625 for each qualifying child in grades kindergarten 
9.30 	to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and 
9.31 	transportation of each qualifying child in attending an elementary or secondary school 
9.32 	situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a 
9.33 	resident of this state may legally fulfill the state's compulsory attendance laws, which 
9.34 	is not operated for profit, and which adheres to the provisions of the Civil Rights Act 
9.35 	of 1964 and chapter 363A. For the purposes of this clause, "tuition" includes fees or 
10.1 	tuition as defined in section 290.0674, subdivision 1, clause (1). As used in this clause, 
10.2 	"textbooks" includes books and other instructional materials and equipment purchased 
10.3 	or leased for use in elementary and secondary schools in teaching only those subjects 
10.4 	legally and commonly taught in public elementary and secondary schools in this state. 
10.5 	Equipment expenses qualifying for deduction includes expenses as defined and limited in 
10.6 	section 290.0674, subdivision 1, clause (3). "Textbooks" does not include instructional 
10.7 	books and materials used in the teaching of religious tenets, doctrines, or worship, the 
10.8 	purpose of which is to instill such tenets, doctrines, or worship, nor does it include books 
10.9 	or materials for, or transportation to, extracurricular activities including sporting events, 
10.10 	musical or dramatic events, speech activities, driver's education, or similar programs. No 
10.11 	deduction is permitted for any expense the taxpayer incurred in using the taxpayer's or 
10.12 	the qualifying child's vehicle to provide such transportation for a qualifying child. For 
10.13 	purposes of the subtraction provided by this clause, "qualifying child" has the meaning 
10.14 	given in section 32(c)(3) of the Internal Revenue Code;
10.15 	(4) income as provided under section 290.0802;
10.16 	(5) to the extent included in federal adjusted gross income, income realized on 
10.17 	disposition of property exempt from tax under section 290.491;
10.18 	(6) to the extent not deducted or not deductible pursuant to section 408(d)(8)(E) 
10.19 	of the Internal Revenue Code in determining federal taxable income by an individual 
10.20 	who does not itemize deductions for federal income tax purposes for the taxable year, an 
10.21 	amount equal to 50 percent of the excess of charitable contributions over $500 allowable 
10.22 	as a deduction for the taxable year under section 170(a) of the Internal Revenue Code, 
10.23 	under the provisions of Public Law 109-1 and Public Law 111-126;
10.24 	(7) for individuals who are allowed a federal foreign tax credit for taxes that do not 
10.25 	qualify for a credit under section 290.06, subdivision 22, an amount equal to the carryover 
10.26 	of subnational foreign taxes for the taxable year, but not to exceed the total subnational 
10.27 	foreign taxes reported in claiming the foreign tax credit. For purposes of this clause, 
10.28 	"federal foreign tax credit" means the credit allowed under section 27 of the Internal 
10.29 	Revenue Code, and "carryover of subnational foreign taxes" equals the carryover allowed 
10.30 	under section 904(c) of the Internal Revenue Code minus national level foreign taxes to 
10.31 	the extent they exceed the federal foreign tax credit;
10.32 	(8) in each of the five tax years immediately following the tax year in which an 
10.33 	addition is required under subdivision 19a, clause (7), or 19c, clause (15) (14), in the case 
10.34 	of a shareholder of a corporation that is an S corporation, an amount equal to one-fifth 
10.35 	of the delayed depreciation. For purposes of this clause, "delayed depreciation" means 
10.36 	the amount of the addition made by the taxpayer under subdivision 19a, clause (7), or 
11.1 	subdivision 19c, clause (15) (14), in the case of a shareholder of an S corporation, minus 
11.2 	the positive value of any net operating loss under section 172 of the Internal Revenue 
11.3 	Code generated for the tax year of the addition. The resulting delayed depreciation 
11.4 	cannot be less than zero;
11.5 	(9) job opportunity building zone income as provided under section 469.316;
11.6 	(10) to the extent included in federal taxable income, the amount of compensation 
11.7 	paid to members of the Minnesota National Guard or other reserve components of the 
11.8 	United States military for active service, excluding compensation for services performed 
11.9 	under the Active Guard Reserve (AGR) program. For purposes of this clause, "active 
11.10 	service" means (i) state active service as defined in section 190.05, subdivision 5a, clause 
11.11 	(1); or (ii) federally funded state active service as defined in section 190.05, subdivision 
11.12 	5b, but "active service" excludes service performed in accordance with section 190.08, 
11.13 	subdivision 3;
11.14 	(11) to the extent included in federal taxable income, the amount of compensation 
11.15 	paid to Minnesota residents who are members of the armed forces of the United States 
11.16 	or United Nations for active duty performed under United States Code, title 10; or the 
11.17 	authority of the United Nations;
11.18 	(12) an amount, not to exceed $10,000, equal to qualified expenses related to a 
11.19 	qualified donor's donation, while living, of one or more of the qualified donor's organs 
11.20 	to another person for human organ transplantation. For purposes of this clause, "organ" 
11.21 	means all or part of an individual's liver, pancreas, kidney, intestine, lung, or bone marrow; 
11.22 	"human organ transplantation" means the medical procedure by which transfer of a human 
11.23 	organ is made from the body of one person to the body of another person; "qualified 
11.24 	expenses" means unreimbursed expenses for both the individual and the qualified donor 
11.25 	for (i) travel, (ii) lodging, and (iii) lost wages net of sick pay, except that such expenses 
11.26 	may be subtracted under this clause only once; and "qualified donor" means the individual 
11.27 	or the individual's dependent, as defined in section 152 of the Internal Revenue Code. An 
11.28 	individual may claim the subtraction in this clause for each instance of organ donation for 
11.29 	transplantation during the taxable year in which the qualified expenses occur;
11.30 	(13) in each of the five tax years immediately following the tax year in which an 
11.31 	addition is required under subdivision 19a, clause (8), or 19c, clause (16) (15), in the case 
11.32 	of a shareholder of a corporation that is an S corporation, an amount equal to one-fifth 
11.33 	of the addition made by the taxpayer under subdivision 19a, clause (8), or 19c, clause 
11.34 	(16) (15), in the case of a shareholder of a corporation that is an S corporation, minus the 
11.35 	positive value of any net operating loss under section 172 of the Internal Revenue Code 
12.1 	generated for the tax year of the addition. If the net operating loss exceeds the addition for 
12.2 	the tax year, a subtraction is not allowed under this clause;
12.3 	(14) to the extent included in the federal taxable income of a nonresident of 
12.4 	Minnesota, compensation paid to a service member as defined in United States Code, title 
12.5 	10, section 101(a)(5), for military service as defined in the Servicemembers Civil Relief 
12.6 	Act, Public Law 108-189, section 101(2);
12.7 	(15) international economic development zone income as provided under section 
12.8 	469.325;
12.9 	(16) to the extent included in federal taxable income, the amount of national service 
12.10 	educational awards received from the National Service Trust under United States Code, 
12.11 	title 42, sections 12601 to 12604, for service in an approved Americorps National Service 
12.12 	program;
12.13 	(17) to the extent included in federal taxable income, discharge of indebtedness 
12.14 	income resulting from reacquisition of business indebtedness included in federal taxable 
12.15 	income under section 108(i) of the Internal Revenue Code. This subtraction applies only 
12.16 	to the extent that the income was included in net income in a prior year as a result of the 
12.17 	addition under section 290.01, subdivision 19a, clause (16); and
12.18 	(18) the amount of the net operating loss allowed under section 290.095, subdivision 
12.19 	11, paragraph (c).

12.20 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
12.21 	December 31, 2011.

12.22 	Sec. 13. Minnesota Statutes 2011 Supplement, section 290.01, subdivision 19c, 
12.23 	is amended to read:
12.24 		Subd. 19c.Corporations; additions to federal taxable income. For corporations, 
12.25 	there shall be added to federal taxable income:
12.26 	(1) the amount of any deduction taken for federal income tax purposes for income, 
12.27 	excise, or franchise taxes based on net income or related minimum taxes, including but not 
12.28 	limited to the tax imposed under section 290.0922, paid by the corporation to Minnesota, 
12.29 	another state, a political subdivision of another state, the District of Columbia, or any 
12.30 	foreign country or possession of the United States;
12.31 	(2) interest not subject to federal tax upon obligations of: the United States, its 
12.32 	possessions, its agencies, or its instrumentalities; the state of Minnesota or any other 
12.33 	state, any of its political or governmental subdivisions, any of its municipalities, or any 
12.34 	of its governmental agencies or instrumentalities; the District of Columbia; or Indian 
12.35 	tribal governments;
13.1 	(3) exempt-interest dividends received as defined in section 852(b)(5) of the Internal 
13.2 	Revenue Code;
13.3 	(4) the amount of any net operating loss deduction taken for federal income tax 
13.4 	purposes under section 172 or 832(c)(10) of the Internal Revenue Code or operations loss 
13.5 	deduction under section 810 of the Internal Revenue Code;
13.6 	(5) the amount of any special deductions taken for federal income tax purposes 
13.7 	under sections 241 to 247 and 965 of the Internal Revenue Code;
13.8 	(6) losses from the business of mining, as defined in section 290.05, subdivision 1, 
13.9 	clause (a), that are not subject to Minnesota income tax;
13.10 	(7) the amount of any capital losses deducted for federal income tax purposes under 
13.11 	sections 1211 and 1212 of the Internal Revenue Code;
13.12 	(8) the exempt foreign trade income of a foreign sales corporation under sections 
13.13 	921(a) and 291 of the Internal Revenue Code;
13.14 	(9) the amount of percentage depletion deducted under sections 611 through 614 and 
13.15 	291 of the Internal Revenue Code;
13.16 	(10) for certified pollution control facilities placed in service in a taxable year 
13.17 	beginning before December 31, 1986, and for which amortization deductions were elected 
13.18 	under section 169 of the Internal Revenue Code of 1954, as amended through December 
13.19 	31, 1985, the amount of the amortization deduction allowed in computing federal taxable 
13.20 	income for those facilities;
13.21 	(11) the amount of any deemed dividend from a foreign operating corporation 
13.22 	determined pursuant to section 290.17, subdivision 4, paragraph (g). The deemed dividend 
13.23 	shall be reduced by the amount of the addition to income required by clauses (19), (20), 
13.24 	(21), and (22), and (23);
13.25 	(12) the amount of a partner's pro rata share of net income which does not flow 
13.26 	through to the partner because the partnership elected to pay the tax on the income under 
13.27 	section 6242(a)(2) of the Internal Revenue Code;
13.28 	(13) the amount of net income excluded under section 114 of the Internal Revenue 
13.29 	Code;
13.30 	(14) (13) any increase in subpart F income, as defined in section 952(a) of the 
13.31 	Internal Revenue Code, for the taxable year when subpart F income is calculated without 
13.32 	regard to the provisions of Division C, title III, section 303(b) of Public Law 110-343;
13.33 	(15) (14) 80 percent of the depreciation deduction allowed under section 
13.34 	168(k)(1)(A) and (k)(4)(A) of the Internal Revenue Code. For purposes of this clause, if 
13.35 	the taxpayer has an activity that in the taxable year generates a deduction for depreciation 
13.36 	under section 168(k)(1)(A) and (k)(4)(A) and the activity generates a loss for the taxable 
14.1 	year that the taxpayer is not allowed to claim for the taxable year, "the depreciation 
14.2 	allowed under section 168(k)(1)(A) and (k)(4)(A)" for the taxable year is limited to excess 
14.3 	of the depreciation claimed by the activity under section 168(k)(1)(A) and (k)(4)(A) 
14.4 	over the amount of the loss from the activity that is not allowed in the taxable year. In 
14.5 	succeeding taxable years when the losses not allowed in the taxable year are allowed, the 
14.6 	depreciation under section 168(k)(1)(A) and (k)(4)(A) is allowed;
14.7 	(16) (15) 80 percent of the amount by which the deduction allowed by section 179 of 
14.8 	the Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal 
14.9 	Revenue Code of 1986, as amended through December 31, 2003;
14.10 	(17) (16) to the extent deducted in computing federal taxable income, the amount of 
14.11 	the deduction allowable under section 199 of the Internal Revenue Code;
14.12 	(18) (17) for taxable years beginning before January 1, 2013, the exclusion allowed 
14.13 	under section 139A of the Internal Revenue Code for federal subsidies for prescription 
14.14 	drug plans;
14.15 	(19) (18) the amount of expenses disallowed under section 290.10, subdivision 2;
14.16 	(20) (19) an amount equal to the interest and intangible expenses, losses, and 
14.17 	costs paid, accrued, or incurred by any member of the taxpayer's unitary group to or for 
14.18 	the benefit of a corporation that is a member of the taxpayer's unitary business group 
14.19 	that qualifies as a foreign operating corporation. For purposes of this clause, intangible 
14.20 	expenses and costs include:
14.21 	(i) expenses, losses, and costs for, or related to, the direct or indirect acquisition, 
14.22 	use, maintenance or management, ownership, sale, exchange, or any other disposition of 
14.23 	intangible property;
14.24 	(ii) losses incurred, directly or indirectly, from factoring transactions or discounting 
14.25 	transactions;
14.26 	(iii) royalty, patent, technical, and copyright fees;
14.27 	(iv) licensing fees; and
14.28 	(v) other similar expenses and costs.
14.29 	For purposes of this clause, "intangible property" includes stocks, bonds, patents, patent 
14.30 	applications, trade names, trademarks, service marks, copyrights, mask works, trade 
14.31 	secrets, and similar types of intangible assets.
14.32 	This clause does not apply to any item of interest or intangible expenses or costs paid, 
14.33 	accrued, or incurred, directly or indirectly, to a foreign operating corporation with respect 
14.34 	to such item of income to the extent that the income to the foreign operating corporation 
14.35 	is income from sources without the United States as defined in subtitle A, chapter 1, 
14.36 	subchapter N, part 1, of the Internal Revenue Code;
15.1 	(21) (20) except as already included in the taxpayer's taxable income pursuant to 
15.2 	clause (20) (19), any interest income and income generated from intangible property 
15.3 	received or accrued by a foreign operating corporation that is a member of the taxpayer's 
15.4 	unitary group. For purposes of this clause, income generated from intangible property 
15.5 	includes:
15.6 	(i) income related to the direct or indirect acquisition, use, maintenance or 
15.7 	management, ownership, sale, exchange, or any other disposition of intangible property;
15.8 	(ii) income from factoring transactions or discounting transactions;
15.9 	(iii) royalty, patent, technical, and copyright fees;
15.10 	(iv) licensing fees; and
15.11 	(v) other similar income.
15.12 	For purposes of this clause, "intangible property" includes stocks, bonds, patents, patent 
15.13 	applications, trade names, trademarks, service marks, copyrights, mask works, trade 
15.14 	secrets, and similar types of intangible assets.
15.15 	This clause does not apply to any item of interest or intangible income received or accrued 
15.16 	by a foreign operating corporation with respect to such item of income to the extent that 
15.17 	the income is income from sources without the United States as defined in subtitle A, 
15.18 	chapter 1, subchapter N, part 1, of the Internal Revenue Code;
15.19 	(22) (21) the dividends attributable to the income of a foreign operating corporation 
15.20 	that is a member of the taxpayer's unitary group in an amount that is equal to the dividends 
15.21 	paid deduction of a real estate investment trust under section 561(a) of the Internal 
15.22 	Revenue Code for amounts paid or accrued by the real estate investment trust to the 
15.23 	foreign operating corporation;
15.24 	(23) (22) the income of a foreign operating corporation that is a member of the 
15.25 	taxpayer's unitary group in an amount that is equal to gains derived from the sale of real or 
15.26 	personal property located in the United States;
15.27 	(24) (23) for taxable years beginning before January 1, 2010, the additional amount 
15.28 	allowed as a deduction for donation of computer technology and equipment under section 
15.29 	170(e)(6) of the Internal Revenue Code, to the extent deducted from taxable income; and
15.30 	(25) (24) discharge of indebtedness income resulting from reacquisition of business 
15.31 	indebtedness and deferred under section 108(i) of the Internal Revenue Code.

15.32 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
15.33 	December 31, 2011.

15.34 	Sec. 14. Minnesota Statutes 2010, section 290.01, subdivision 19d, is amended to read:
16.1 		Subd. 19d.Corporations; modifications decreasing federal taxable income. For 
16.2 	corporations, there shall be subtracted from federal taxable income after the increases 
16.3 	provided in subdivision 19c:
16.4 	(1) the amount of foreign dividend gross-up added to gross income for federal 
16.5 	income tax purposes under section 78 of the Internal Revenue Code;
16.6 	(2) the amount of salary expense not allowed for federal income tax purposes due to 
16.7 	claiming the work opportunity credit under section 51 of the Internal Revenue Code;
16.8 	(3) any dividend (not including any distribution in liquidation) paid within the 
16.9 	taxable year by a national or state bank to the United States, or to any instrumentality of 
16.10 	the United States exempt from federal income taxes, on the preferred stock of the bank 
16.11 	owned by the United States or the instrumentality;
16.12 	(4) amounts disallowed for intangible drilling costs due to differences between 
16.13 	this chapter and the Internal Revenue Code in taxable years beginning before January 
16.14 	1, 1987, as follows:
16.15 	(i) to the extent the disallowed costs are represented by physical property, an amount 
16.16 	equal to the allowance for depreciation under Minnesota Statutes 1986, section 290.09, 
16.17 	subdivision 7, subject to the modifications contained in subdivision 19e; and
16.18 	(ii) to the extent the disallowed costs are not represented by physical property, an 
16.19 	amount equal to the allowance for cost depletion under Minnesota Statutes 1986, section 
16.20 	290.09, subdivision 8;
16.21 	(5) the deduction for capital losses pursuant to sections 1211 and 1212 of the 
16.22 	Internal Revenue Code, except that:
16.23 	(i) for capital losses incurred in taxable years beginning after December 31, 1986, 
16.24 	capital loss carrybacks shall not be allowed;
16.25 	(ii) for capital losses incurred in taxable years beginning after December 31, 1986, 
16.26 	a capital loss carryover to each of the 15 taxable years succeeding the loss year shall be 
16.27 	allowed;
16.28 	(iii) for capital losses incurred in taxable years beginning before January 1, 1987, a 
16.29 	capital loss carryback to each of the three taxable years preceding the loss year, subject to 
16.30 	the provisions of Minnesota Statutes 1986, section 290.16, shall be allowed; and
16.31 	(iv) for capital losses incurred in taxable years beginning before January 1, 1987, 
16.32 	a capital loss carryover to each of the five taxable years succeeding the loss year to the 
16.33 	extent such loss was not used in a prior taxable year and subject to the provisions of 
16.34 	Minnesota Statutes 1986, section 290.16, shall be allowed;
16.35 	(6) an amount for interest and expenses relating to income not taxable for federal 
16.36 	income tax purposes, if (i) the income is taxable under this chapter and (ii) the interest and 
17.1 	expenses were disallowed as deductions under the provisions of section 171(a)(2), 265 or 
17.2 	291 of the Internal Revenue Code in computing federal taxable income;
17.3 	(7) in the case of mines, oil and gas wells, other natural deposits, and timber for 
17.4 	which percentage depletion was disallowed pursuant to subdivision 19c, clause (9), a 
17.5 	reasonable allowance for depletion based on actual cost. In the case of leases the deduction 
17.6 	must be apportioned between the lessor and lessee in accordance with rules prescribed 
17.7 	by the commissioner. In the case of property held in trust, the allowable deduction must 
17.8 	be apportioned between the income beneficiaries and the trustee in accordance with the 
17.9 	pertinent provisions of the trust, or if there is no provision in the instrument, on the basis 
17.10 	of the trust's income allocable to each;
17.11 	(8) for certified pollution control facilities placed in service in a taxable year 
17.12 	beginning before December 31, 1986, and for which amortization deductions were elected 
17.13 	under section 169 of the Internal Revenue Code of 1954, as amended through December 
17.14 	31, 1985, an amount equal to the allowance for depreciation under Minnesota Statutes 
17.15 	1986, section 290.09, subdivision 7;
17.16 	(9) amounts included in federal taxable income that are due to refunds of income, 
17.17 	excise, or franchise taxes based on net income or related minimum taxes paid by the 
17.18 	corporation to Minnesota, another state, a political subdivision of another state, the 
17.19 	District of Columbia, or a foreign country or possession of the United States to the extent 
17.20 	that the taxes were added to federal taxable income under section 290.01, subdivision 19c, 
17.21 	clause (1), in a prior taxable year;
17.22 	(10) 80 percent of royalties, fees, or other like income accrued or received from a 
17.23 	foreign operating corporation or a foreign corporation which is part of the same unitary 
17.24 	business as the receiving corporation, unless the income resulting from such payments or 
17.25 	accruals is income from sources within the United States as defined in subtitle A, chapter 
17.26 	1, subchapter N, part 1, of the Internal Revenue Code;
17.27 	(11) income or gains from the business of mining as defined in section 290.05, 
17.28 	subdivision 1, clause (a), that are not subject to Minnesota franchise tax;
17.29 	(12) the amount of disability access expenditures in the taxable year which are not 
17.30 	allowed to be deducted or capitalized under section 44(d)(7) of the Internal Revenue Code;
17.31 	(13) the amount of qualified research expenses not allowed for federal income tax 
17.32 	purposes under section 280C(c) of the Internal Revenue Code, but only to the extent that 
17.33 	the amount exceeds the amount of the credit allowed under section 290.068;
17.34 	(14) the amount of salary expenses not allowed for federal income tax purposes due 
17.35 	to claiming the Indian employment credit under section 45A(a) of the Internal Revenue 
17.36 	Code;
18.1 	(15) for a corporation whose foreign sales corporation, as defined in section 922 
18.2 	of the Internal Revenue Code, constituted a foreign operating corporation during any 
18.3 	taxable year ending before January 1, 1995, and a return was filed by August 15, 1996, 
18.4 	claiming the deduction under section 290.21, subdivision 4, for income received from 
18.5 	the foreign operating corporation, an amount equal to 1.23 multiplied by the amount of 
18.6 	income excluded under section 114 of the Internal Revenue Code, provided the income is 
18.7 	not income of a foreign operating company;
18.8 	(16) (15) any decrease in subpart F income, as defined in section 952(a) of the 
18.9 	Internal Revenue Code, for the taxable year when subpart F income is calculated without 
18.10 	regard to the provisions of Division C, title III, section 303(b) of Public Law 110-343;
18.11 	(17) (16) in each of the five tax years immediately following the tax year in which an 
18.12 	addition is required under subdivision 19c, clause (15) (14), an amount equal to one-fifth 
18.13 	of the delayed depreciation. For purposes of this clause, "delayed depreciation" means the 
18.14 	amount of the addition made by the taxpayer under subdivision 19c, clause (15) (14). The 
18.15 	resulting delayed depreciation cannot be less than zero;
18.16 	(18) (17) in each of the five tax years immediately following the tax year in which an 
18.17 	addition is required under subdivision 19c, clause (16) (15), an amount equal to one-fifth 
18.18 	of the amount of the addition; and
18.19 	(19) (18) to the extent included in federal taxable income, discharge of indebtedness 
18.20 	income resulting from reacquisition of business indebtedness included in federal taxable 
18.21 	income under section 108(i) of the Internal Revenue Code. This subtraction applies only 
18.22 	to the extent that the income was included in net income in a prior year as a result of the 
18.23 	addition under section 290.01, subdivision 19c, clause (25) (24).

18.24 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
18.25 	December 31, 2011.

18.26 	Sec. 15. Minnesota Statutes 2010, section 290.0921, subdivision 3, is amended to read:
18.27 		Subd. 3.Alternative minimum taxable income. "Alternative minimum taxable 
18.28 	income" is Minnesota net income as defined in section 290.01, subdivision 19, and 
18.29 	includes the adjustments and tax preference items in sections 56, 57, 58, and 59(d), (e), 
18.30 	(f), and (h) of the Internal Revenue Code. If a corporation files a separate company 
18.31 	Minnesota tax return, the minimum tax must be computed on a separate company basis. 
18.32 	If a corporation is part of a tax group filing a unitary return, the minimum tax must be 
18.33 	computed on a unitary basis. The following adjustments must be made.
18.34 	(1) For purposes of the depreciation adjustments under section 56(a)(1) and 
18.35 	56(g)(4)(A) of the Internal Revenue Code, the basis for depreciable property placed in 
19.1 	service in a taxable year beginning before January 1, 1990, is the adjusted basis for federal 
19.2 	income tax purposes, including any modification made in a taxable year under section 
19.3 	290.01, subdivision 19e, or Minnesota Statutes 1986, section 290.09, subdivision 7, 
19.4 	paragraph (c).
19.5 	For taxable years beginning after December 31, 2000, the amount of any remaining 
19.6 	modification made under section 290.01, subdivision 19e, or Minnesota Statutes 1986, 
19.7 	section 290.09, subdivision 7, paragraph (c), not previously deducted is a depreciation 
19.8 	allowance in the first taxable year after December 31, 2000.
19.9 	(2) The portion of the depreciation deduction allowed for federal income tax 
19.10 	purposes under section 168(k) of the Internal Revenue Code that is required as an addition 
19.11 	under section 290.01, subdivision 19c, clause (15) (14), is disallowed in determining 
19.12 	alternative minimum taxable income.
19.13 	(3) The subtraction for depreciation allowed under section 290.01, subdivision 
19.14 	19d, clause (17) (16), is allowed as a depreciation deduction in determining alternative 
19.15 	minimum taxable income.
19.16 	(4) The alternative tax net operating loss deduction under sections 56(a)(4) and 56(d) 
19.17 	of the Internal Revenue Code does not apply.
19.18 	(5) The special rule for certain dividends under section 56(g)(4)(C)(ii) of the Internal 
19.19 	Revenue Code does not apply.
19.20 	(6) The special rule for dividends from section 936 companies under section 
19.21 	56(g)(4)(C)(iii) does not apply.
19.22 	(7) (6) The tax preference for depletion under section 57(a)(1) of the Internal 
19.23 	Revenue Code does not apply.
19.24 	(8) (7) The tax preference for intangible drilling costs under section 57(a)(2) of the 
19.25 	Internal Revenue Code must be calculated without regard to subparagraph (E) and the 
19.26 	subtraction under section 290.01, subdivision 19d, clause (4).
19.27 	(9) (8) The tax preference for tax exempt interest under section 57(a)(5) of the 
19.28 	Internal Revenue Code does not apply.
19.29 	(10) (9) The tax preference for charitable contributions of appreciated property 
19.30 	under section 57(a)(6) of the Internal Revenue Code does not apply.
19.31 	(11) (10) For purposes of calculating the tax preference for accelerated depreciation 
19.32 	or amortization on certain property placed in service before January 1, 1987, under section 
19.33 	57(a)(7) of the Internal Revenue Code, the deduction allowable for the taxable year is the 
19.34 	deduction allowed under section 290.01, subdivision 19e.
20.1 	For taxable years beginning after December 31, 2000, the amount of any remaining 
20.2 	modification made under section 290.01, subdivision 19e, not previously deducted is a 
20.3 	depreciation or amortization allowance in the first taxable year after December 31, 2004.
20.4 	(12) (11) For purposes of calculating the adjustment for adjusted current earnings 
20.5 	in section 56(g) of the Internal Revenue Code, the term "alternative minimum taxable 
20.6 	income" as it is used in section 56(g) of the Internal Revenue Code, means alternative 
20.7 	minimum taxable income as defined in this subdivision, determined without regard to the 
20.8 	adjustment for adjusted current earnings in section 56(g) of the Internal Revenue Code.
20.9 	(13) (12) For purposes of determining the amount of adjusted current earnings 
20.10 	under section 56(g)(3) of the Internal Revenue Code, no adjustment shall be made under 
20.11 	section 56(g)(4) of the Internal Revenue Code with respect to (i) the amount of foreign 
20.12 	dividend gross-up subtracted as provided in section 290.01, subdivision 19d, clause (1), 
20.13 	(ii) the amount of refunds of income, excise, or franchise taxes subtracted as provided in 
20.14 	section 290.01, subdivision 19d, clause (9), or (iii) the amount of royalties, fees or other 
20.15 	like income subtracted as provided in section 290.01, subdivision 19d, clause (10).
20.16 	(14) (13) Alternative minimum taxable income excludes the income from operating 
20.17 	in a job opportunity building zone as provided under section 469.317.
20.18 	(15) (14) Alternative minimum taxable income excludes the income from operating 
20.19 	in a biotechnology and health sciences industry zone as provided under section 469.337.
20.20 	(16) (15) Alternative minimum taxable income excludes the income from operating 
20.21 	in an international economic development zone as provided under section 469.326.
20.22 	Items of tax preference must not be reduced below zero as a result of the 
20.23 	modifications in this subdivision.

20.24 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
20.25 	December 31, 2011.

20.26 	Sec. 16. Minnesota Statutes 2010, section 290.17, subdivision 4, is amended to read:
20.27 		Subd. 4.Unitary business principle. (a) If a trade or business conducted wholly 
20.28 	within this state or partly within and partly without this state is part of a unitary business, 
20.29 	the entire income of the unitary business is subject to apportionment pursuant to section 
20.30 	290.191. Notwithstanding subdivision 2, paragraph (c), none of the income of a unitary 
20.31 	business is considered to be derived from any particular source and none may be allocated 
20.32 	to a particular place except as provided by the applicable apportionment formula. The 
20.33 	provisions of this subdivision do not apply to business income subject to subdivision 5, 
20.34 	income of an insurance company, or income of an investment company determined under 
20.35 	section 290.36.
21.1 	(b) The term "unitary business" means business activities or operations which 
21.2 	result in a flow of value between them. The term may be applied within a single legal 
21.3 	entity or between multiple entities and without regard to whether each entity is a sole 
21.4 	proprietorship, a corporation, a partnership or a trust.
21.5 	(c) Unity is presumed whenever there is unity of ownership, operation, and use, 
21.6 	evidenced by centralized management or executive force, centralized purchasing, 
21.7 	advertising, accounting, or other controlled interaction, but the absence of these 
21.8 	centralized activities will not necessarily evidence a nonunitary business. Unity is also 
21.9 	presumed when business activities or operations are of mutual benefit, dependent upon or 
21.10 	contributory to one another, either individually or as a group.
21.11 	(d) Where a business operation conducted in Minnesota is owned by a business 
21.12 	entity that carries on business activity outside the state different in kind from that 
21.13 	conducted within this state, and the other business is conducted entirely outside the state, it 
21.14 	is presumed that the two business operations are unitary in nature, interrelated, connected, 
21.15 	and interdependent unless it can be shown to the contrary.
21.16 	(e) Unity of ownership is does not deemed to exist when a corporation istwo or 
21.17 	more corporations are involved unless that corporation is a member of a group of two or 
21.18 	more business entities and more than 50 percent of the voting stock of each member of 
21.19 	the group corporation is directly or indirectly owned by a common owner or by common 
21.20 	owners, either corporate or noncorporate, or by one or more of the member corporations 
21.21 	of the group. For this purpose, the term "voting stock" shall include membership interests 
21.22 	of mutual insurance holding companies formed under section 66A.40.
21.23 	(f) The net income and apportionment factors under section 290.191 or 290.20 of 
21.24 	foreign corporations and other foreign entities which are part of a unitary business shall 
21.25 	not be included in the net income or the apportionment factors of the unitary business. 
21.26 	A foreign corporation or other foreign entity which is required to file a return under this 
21.27 	chapter shall file on a separate return basis. The net income and apportionment factors 
21.28 	under section 290.191 or 290.20 of foreign operating corporations shall not be included in 
21.29 	the net income or the apportionment factors of the unitary business except as provided in 
21.30 	paragraph (g).
21.31 	(g) The adjusted net income of a foreign operating corporation shall be deemed to 
21.32 	be paid as a dividend on the last day of its taxable year to each shareholder thereof, in 
21.33 	proportion to each shareholder's ownership, with which such corporation is engaged in 
21.34 	a unitary business. Such deemed dividend shall be treated as a dividend under section 
21.35 	290.21, subdivision 4.
22.1 	Dividends actually paid by a foreign operating corporation to a corporate shareholder 
22.2 	which is a member of the same unitary business as the foreign operating corporation shall 
22.3 	be eliminated from the net income of the unitary business in preparing a combined report 
22.4 	for the unitary business. The adjusted net income of a foreign operating corporation 
22.5 	shall be its net income adjusted as follows:
22.6 	(1) any taxes paid or accrued to a foreign country, the commonwealth of Puerto 
22.7 	Rico, or a United States possession or political subdivision of any of the foregoing shall 
22.8 	be a deduction; and
22.9 	(2) the subtraction from federal taxable income for payments received from foreign 
22.10 	corporations or foreign operating corporations under section 290.01, subdivision 19d, 
22.11 	clause (10), shall not be allowed.
22.12 	If a foreign operating corporation incurs a net loss, neither income nor deduction 
22.13 	from that corporation shall be included in determining the net income of the unitary 
22.14 	business.
22.15 	(h) For purposes of determining the net income of a unitary business and the factors 
22.16 	to be used in the apportionment of net income pursuant to section 290.191 or 290.20, there 
22.17 	must be included only the income and apportionment factors of domestic corporations or 
22.18 	other domestic entities other than foreign operating corporations that are determined to 
22.19 	be part of the unitary business pursuant to this subdivision, notwithstanding that foreign 
22.20 	corporations or other foreign entities might be included in the unitary business.
22.21 	(i) Deductions for expenses, interest, or taxes otherwise allowable under this chapter 
22.22 	that are connected with or allocable against dividends, deemed dividends described 
22.23 	in paragraph (g), or royalties, fees, or other like income described in section 290.01, 
22.24 	subdivision 19d, clause (10), shall not be disallowed.
22.25 	(j) Each corporation or other entity, except a sole proprietorship, that is part of a 
22.26 	unitary business must file combined reports as the commissioner determines. On the 
22.27 	reports, all intercompany transactions between entities included pursuant to paragraph 
22.28 	(h) must be eliminated and the entire net income of the unitary business determined in 
22.29 	accordance with this subdivision is apportioned among the entities by using each entity's 
22.30 	Minnesota factors for apportionment purposes in the numerators of the apportionment 
22.31 	formula and the total factors for apportionment purposes of all entities included pursuant 
22.32 	to paragraph (h) in the denominators of the apportionment formula.
22.33 	(k) If a corporation has been divested from a unitary business and is included in a 
22.34 	combined report for a fractional part of the common accounting period of the combined 
22.35 	report:
23.1 	(1) its income includable in the combined report is its income incurred for that part 
23.2 	of the year determined by proration or separate accounting; and
23.3 	(2) its sales, property, and payroll included in the apportionment formula must 
23.4 	be prorated or accounted for separately.

23.5 	EFFECTIVE DATE. This section is effective the day following final enactment.

23.6 	ARTICLE 2
23.7 	DEPARTMENT POLICY AND TECHNICAL: PROPERTY TAX

23.8 	Section 1. Minnesota Statutes 2010, section 13.4965, subdivision 3, is amended to read:
23.9 		Subd. 3.Homestead and other applications. The classification and disclosure of 
23.10 	certain information collected to determine eligibility of property for a homestead or other 
23.11 	classification or benefit under section 273.13 are governed by section sections 273.124, 
23.12 	subdivision subdivisions 13, 13a, 13c, and 13d, and 273.1315.

23.13 	EFFECTIVE DATE. This section is effective the day following final enactment.

23.14 	Sec. 2. Minnesota Statutes 2010, section 270.077, is amended to read:
23.15 	270.077 TAXES CREDITED TO STATE AIRPORTS FUND.
23.16 	All taxes levied under sections 270.071 to 270.079 must be collected by the 
23.17 	commissioner and credited to the state airports fund created in section 360.017.

23.18 	EFFECTIVE DATE. This section is effective for reports filed on July 1, 2012, 
23.19 	and thereafter.

23.20 	Sec. 3. Minnesota Statutes 2010, section 270.41, subdivision 5, is amended to read:
23.21 		Subd. 5.Prohibited activity. A licensed assessor or other person employed by an 
23.22 	assessment jurisdiction or contracting with an assessment jurisdiction for the purpose 
23.23 	of valuing or classifying property for property tax purposes is prohibited from making 
23.24 	appraisals or analyses, accepting an appraisal assignment, or preparing an appraisal report 
23.25 	as defined in section 82B.021, subdivisions 2, 4, 6, and 7, on any property within the 
23.26 	assessment jurisdiction where the individual is employed or performing the duties of the 
23.27 	assessor under contract. Violation of this prohibition shall result in immediate revocation 
23.28 	of the individual's license to assess property for property tax purposes. This prohibition 
23.29 	must not be construed to prohibit an individual from carrying out any duties required 
23.30 	for the proper assessment of property for property tax purposes or performing duties 
23.31 	enumerated in section 273.061, subdivision 7 or 8. If a formal resolution has been adopted 
24.1 	by the governing body of a governmental unit, which specifies the purposes for which 
24.2 	such work will be done, this prohibition does not apply to appraisal activities undertaken 
24.3 	on behalf of and at the request of the governmental unit that has employed or contracted 
24.4 	with the individual. The resolution may only allow appraisal activities which are related to 
24.5 	condemnations, right-of-way acquisitions, land exchanges, or special assessments.

24.6 	EFFECTIVE DATE. This section is effective the day following final enactment.

24.7 	Sec. 4. Minnesota Statutes 2011 Supplement, section 270C.34, subdivision 1, is 
24.8 	amended to read:
24.9 		Subdivision 1.Authority. (a) The commissioner may abate, reduce, or refund any 
24.10 	penalty or interest that is imposed by a law administered by the commissioner, or imposed 
24.11 	by section 270.0725, subdivision 1 or 2, or 270.075, as a result of the late payment of tax 
24.12 	or late filing of a return, or any part of an additional tax charge under section 289A.25, 
24.13 	subdivision 2, or 289A.26, subdivision 4, if the failure to timely pay the tax or failure 
24.14 	to timely file the return is due to reasonable cause, or if the taxpayer is located in a 
24.15 	presidentially declared disaster or in a presidentially declared state of emergency area or 
24.16 	in an area declared to be in a state of emergency by the governor under section 12.31.
24.17 	(b) The commissioner shall abate any part of a penalty or additional tax charge 
24.18 	under section 289A.25, subdivision 2, or 289A.26, subdivision 4, attributable to erroneous 
24.19 	advice given to the taxpayer in writing by an employee of the department acting in 
24.20 	an official capacity, if the advice:
24.21 	(1) was reasonably relied on and was in response to a specific written request of the 
24.22 	taxpayer; and
24.23 	(2) was not the result of failure by the taxpayer to provide adequate or accurate 
24.24 	information.

24.25 	EFFECTIVE DATE. This section is effective the day following final enactment.

24.26 	Sec. 5. Minnesota Statutes 2010, section 272.01, subdivision 2, is amended to read:
24.27 		Subd. 2.Exempt property used by private entity for profit. (a) When any real or 
24.28 	personal property which is exempt from ad valorem taxes, and taxes in lieu thereof, is 
24.29 	leased, loaned, or otherwise made available and used by a private individual, association, 
24.30 	or corporation in connection with a business conducted for profit, there shall be imposed a 
24.31 	tax, for the privilege of so using or possessing such real or personal property, in the same 
24.32 	amount and to the same extent as though the lessee or user was the owner of such property.
24.33 	(b) The tax imposed by this subdivision shall not apply to:
25.1 	(1) property leased or used as a concession in or relative to the use in whole 
25.2 	or part of a public park, market, fairgrounds, port authority, economic development 
25.3 	authority established under chapter 469, municipal auditorium, municipal parking facility, 
25.4 	municipal museum, or municipal stadium;
25.5 	(2) property of an airport owned by a city, town, county, or group thereof which is:
25.6 	(i) leased to or used by any person or entity including a fixed base operator; and
25.7 	(ii) used as a hangar for the storage or repair of aircraft or to provide aviation goods, 
25.8 	services, or facilities to the airport or general public;
25.9 	the exception from taxation provided in this clause does not apply to:
25.10 	(i) property located at an airport owned or operated by the Metropolitan Airports 
25.11 	Commission or by a city of over 50,000 population according to the most recent federal 
25.12 	census or such a city's airport authority; or
25.13 	(ii) hangars leased by a private individual, association, or corporation in connection 
25.14 	with a business conducted for profit other than an aviation-related business;
25.15 	(3) property constituting or used as a public pedestrian ramp or concourse in 
25.16 	connection with a public airport;
25.17 	(4) property constituting or used as a passenger check-in area or ticket sale counter, 
25.18 	boarding area, or luggage claim area in connection with a public airport but not the 
25.19 	airports owned or operated by the Metropolitan Airports Commission or cities of over 
25.20 	50,000 population or an airport authority therein. Real estate owned by a municipality 
25.21 	in connection with the operation of a public airport and leased or used for agricultural 
25.22 	purposes is not exempt;
25.23 	(5) property leased, loaned, or otherwise made available to a private individual, 
25.24 	corporation, or association under a cooperative farming agreement made pursuant to 
25.25 	section 97A.135; or
25.26 	(6) property leased, loaned, or otherwise made available to a private individual, 
25.27 	corporation, or association under section 272.68, subdivision 4.
25.28 	(c) Taxes imposed by this subdivision are payable as in the case of personal property 
25.29 	taxes and shall be assessed to the lessees or users of real or personal property in the same 
25.30 	manner as taxes assessed to owners of real or personal property, except that such taxes 
25.31 	shall not become a lien against the property. When due, the taxes shall constitute a debt 
25.32 	due from the lessee or user to the state, township, city, county, and school district for 
25.33 	which the taxes were assessed and shall be collected in the same manner as personal 
25.34 	property taxes. If property subject to the tax imposed by this subdivision is leased or used 
25.35 	jointly by two or more persons, each lessee or user shall be jointly and severally liable for 
25.36 	payment of the tax.
26.1 	(d) The tax on real property of the federal government, the state or any of its political 
26.2 	subdivisions that is leased by a private individual, association, or corporation and becomes 
26.3 	taxable under this subdivision or other provision of law must be assessed and collected as 
26.4 	a personal property assessment. The taxes do not become a lien against the real property.

26.5 	EFFECTIVE DATE. This section is effective the day following final enactment.

26.6 	Sec. 6. Minnesota Statutes 2011 Supplement, section 273.114, subdivision 6, is 
26.7 	amended to read:
26.8 		Subd. 6.Additional taxes. (a) When real property which is being, or has been 
26.9 	valued and assessed under this section is sold, transferred, or no longer qualifies under 
26.10 	subdivision 2, the portion sold, transferred, or no longer qualifying shall be subject to 
26.11 	additional taxes in the amount equal to the difference between the taxes determined in 
26.12 	accordance with subdivision 3 and the amount determined under subdivision 4, provided 
26.13 	that the amount determined under subdivision 4 shall not be greater than it would have 
26.14 	been had the actual bona fide sale price of the real property at an arm's-length transaction 
26.15 	been used in lieu of the market value determined under subdivision 4. The additional taxes 
26.16 	shall be extended against the property on the tax list for taxes payable in the current year, 
26.17 	provided that no interest or penalties shall be levied on the additional taxes if timely paid 
26.18 	and provided that the additional taxes shall only be levied with respect to the current year 
26.19 	plus two prior years that the property has been valued and assessed under this section.
26.20 	(b) In the case of a sale or transfer, the additional taxes under paragraph (a) shall not 
26.21 	be extended against the property if the new owner submits a successful application by the 
26.22 	later of May 1 of the current year or 30 days after the sale or transfer.
26.23 	(c) For the purposes of this section, the following events do not constitute a sale or 
26.24 	transfer for property that qualified under subdivision 2 prior to the event:
26.25 	(1) death of a property owner when the surviving owners retain ownership of the 
26.26 	property;
26.27 	(2) divorce of a married couple when one of the spouses retains ownership of the 
26.28 	property;
26.29 	(3) marriage of a single property owner when that owner retains ownership of the 
26.30 	property in whole or in part;
26.31 	(4) the organization or reorganization of a farm ownership entity that is not prohibited 
26.32 	from owning agricultural land in this state under section 500.24, if all owners maintain the 
26.33 	same beneficial interest both before and after the organization or reorganization; and
27.1 	(5) transfer of the property to a trust or trustee, provided that the individual owners 
27.2 	of the property are the grantors of the trust and they maintain the same beneficial interest 
27.3 	both before and after placement of the property in trust.

27.4 	EFFECTIVE DATE. This section is effective the day following final enactment.

27.5 	Sec. 7. Minnesota Statutes 2010, section 273.124, subdivision 13, is amended to read:
27.6 		Subd. 13.Homestead application. (a) A person who meets the homestead 
27.7 	requirements under subdivision 1 must file a homestead application with the county 
27.8 	assessor to initially obtain homestead classification.
27.9 	(b) The format and contents of a uniform homestead application shall be prescribed 
27.10 	by the commissioner of revenue. The application must clearly inform the taxpayer that 
27.11 	this application must be signed by all owners who occupy the property or by the qualifying 
27.12 	relative and returned to the county assessor in order for the property to receive homestead 
27.13 	treatment.
27.14 	(c) Every property owner applying for homestead classification must furnish to the 
27.15 	county assessor the Social Security number of each occupant who is listed as an owner 
27.16 	of the property on the deed of record, the name and address of each owner who does not 
27.17 	occupy the property, and the name and Social Security number of each owner's spouse who 
27.18 	occupies the property. The application must be signed by each owner who occupies the 
27.19 	property and by each owner's spouse who occupies the property, or, in the case of property 
27.20 	that qualifies as a homestead under subdivision 1, paragraph (c), by the qualifying relative.
27.21 	If a property owner occupies a homestead, the property owner's spouse may not 
27.22 	claim another property as a homestead unless the property owner and the property owner's 
27.23 	spouse file with the assessor an affidavit or other proof required by the assessor stating that 
27.24 	the property qualifies as a homestead under subdivision 1, paragraph (e).
27.25 	Owners or spouses occupying residences owned by their spouses and previously 
27.26 	occupied with the other spouse, either of whom fail to include the other spouse's name 
27.27 	and Social Security number on the homestead application or provide the affidavits or 
27.28 	other proof requested, will be deemed to have elected to receive only partial homestead 
27.29 	treatment of their residence. The remainder of the residence will be classified as 
27.30 	nonhomestead residential. When an owner or spouse's name and Social Security number 
27.31 	appear on homestead applications for two separate residences and only one application is 
27.32 	signed, the owner or spouse will be deemed to have elected to homestead the residence for 
27.33 	which the application was signed.
27.34 	The Social Security numbers, state or federal tax returns or tax return information, 
27.35 	including the federal income tax schedule F, required by this section, or section 273.13, 
28.1 	and affidavits or other proofs of the property owners and spouses submitted under this 
28.2 	or another section to support a claim for a property tax homestead classification or other 
28.3 	classification or benefit under section 273.13, are private data on individuals as defined by 
28.4 	section 13.02, subdivision 12, or nonpublic data as defined in section 13.02, subdivision 9,
28.5 	but, notwithstanding that section, the private and nonpublic data may be disclosed to the 
28.6 	commissioner of revenue, or, for purposes of proceeding under the Revenue Recapture 
28.7 	Act to recover personal property taxes owing, to the county treasurer.
28.8 	(d) If residential real estate is occupied and used for purposes of a homestead by a 
28.9 	relative of the owner and qualifies for a homestead under subdivision 1, paragraph (c), in 
28.10 	order for the property to receive homestead status, a homestead application must be filed 
28.11 	with the assessor. The Social Security number of each relative and spouse of a relative 
28.12 	occupying the property shall be required on the homestead application filed under this 
28.13 	subdivision. If a different relative of the owner subsequently occupies the property, the 
28.14 	owner of the property must notify the assessor within 30 days of the change in occupancy. 
28.15 	The Social Security number of a relative or relative's spouse occupying the property 
28.16 	is private data on individuals as defined by section 13.02, subdivision 12, but may be 
28.17 	disclosed to the commissioner of revenue, or, for the purposes of proceeding under the 
28.18 	Revenue Recapture Act to recover personal property taxes owing, to the county treasurer.
28.19 	(e) The homestead application shall also notify the property owners that the 
28.20 	application filed under this section will not be mailed annually and that if the property 
28.21 	is granted homestead status for any assessment year, that same property shall remain 
28.22 	classified as homestead until the property is sold or transferred to another person, or 
28.23 	the owners, the spouse of the owner, or the relatives no longer use the property as their 
28.24 	homestead. Upon the sale or transfer of the homestead property, a certificate of value must 
28.25 	be timely filed with the county auditor as provided under section 272.115. Failure to 
28.26 	notify the assessor within 30 days that the property has been sold, transferred, or that the 
28.27 	owner, the spouse of the owner, or the relative is no longer occupying the property as a 
28.28 	homestead, shall result in the penalty provided under this subdivision and the property 
28.29 	will lose its current homestead status.
28.30 	(f) If the homestead application is not returned within 30 days, the county will send a 
28.31 	second application to the present owners of record. The notice of proposed property taxes 
28.32 	prepared under section 275.065, subdivision 3, shall reflect the property's classification. If 
28.33 	a homestead application has not been filed with the county by December 15, the assessor 
28.34 	shall classify the property as nonhomestead for the current assessment year for taxes 
28.35 	payable in the following year, provided that the owner may be entitled to receive the 
28.36 	homestead classification by proper application under section 375.192.
29.1 		Subd. 13a.Occupant list. (g) At the request of the commissioner, each county 
29.2 	must give the commissioner a list that includes the name and Social Security number 
29.3 	of each occupant of homestead property who is the property owner, property owner's 
29.4 	spouse, qualifying relative of a property owner, or a spouse of a qualifying relative. The 
29.5 	commissioner shall use the information provided on the lists as appropriate under the law, 
29.6 	including for the detection of improper claims by owners, or relatives of owners, under 
29.7 	chapter 290A.
29.8 		Subd. 13b.Improper homestead. (h) (a) If the commissioner finds that a 
29.9 	property owner may be claiming a fraudulent homestead, the commissioner shall notify 
29.10 	the appropriate counties. Within 90 days of the notification, the county assessor shall 
29.11 	investigate to determine if the homestead classification was properly claimed. If the 
29.12 	property owner does not qualify, the county assessor shall notify the county auditor who 
29.13 	will determine the amount of homestead benefits that had been improperly allowed. For the 
29.14 	purpose of this section subdivision, "homestead benefits" means the tax reduction resulting 
29.15 	from the classification as a homestead under section 273.13, the taconite homestead credit 
29.16 	under section 273.135, the residential homestead and agricultural homestead credits under 
29.17 	section 273.1384, and the supplemental homestead credit under section 273.1391.
29.18 	The county auditor shall send a notice to the person who owned the affected property 
29.19 	at the time the homestead application related to the improper homestead was filed, 
29.20 	demanding reimbursement of the homestead benefits plus a penalty equal to 100 percent 
29.21 	of the homestead benefits. The person notified may appeal the county's determination 
29.22 	by serving copies of a petition for review with county officials as provided in section 
29.23 	278.01 and filing proof of service as provided in section 278.01 with the Minnesota Tax 
29.24 	Court within 60 days of the date of the notice from the county. Procedurally, the appeal 
29.25 	is governed by the provisions in chapter 271 which apply to the appeal of a property tax 
29.26 	assessment or levy, but without requiring any prepayment of the amount in controversy. If 
29.27 	the amount of homestead benefits and penalty is not paid within 60 days, and if no appeal 
29.28 	has been filed, the county auditor shall certify the amount of taxes and penalty to the county 
29.29 	treasurer. The county treasurer will add interest to the unpaid homestead benefits and 
29.30 	penalty amounts at the rate provided in section 279.03 for real property taxes becoming 
29.31 	delinquent in the calendar year during which the amount remains unpaid. Interest may be 
29.32 	assessed for the period beginning 60 days after demand for payment was made.
29.33 	If the person notified is the current owner of the property, the treasurer may add the 
29.34 	total amount of homestead benefits, penalty, interest, and costs to the ad valorem taxes 
29.35 	otherwise payable on the property by including the amounts on the property tax statements 
29.36 	under section 276.04, subdivision 3. The amounts added under this paragraph to the ad 
30.1 	valorem taxes shall include interest accrued through December 31 of the year preceding 
30.2 	the taxes payable year for which the amounts are first added. These amounts, when added 
30.3 	to the property tax statement, become subject to all the laws for the enforcement of real or 
30.4 	personal property taxes for that year, and for any subsequent year.
30.5 	If the person notified is not the current owner of the property, the treasurer may 
30.6 	collect the amounts due under the Revenue Recapture Act in chapter 270A, or use any of 
30.7 	the powers granted in sections 277.20 and 277.21 without exclusion, to enforce payment 
30.8 	of the homestead benefits, penalty, interest, and costs, as if those amounts were delinquent 
30.9 	tax obligations of the person who owned the property at the time the application related 
30.10 	to the improperly allowed homestead was filed. The treasurer may relieve a prior owner 
30.11 	of personal liability for the homestead benefits, penalty, interest, and costs, and instead 
30.12 	extend those amounts on the tax lists against the property as provided in this paragraph 
30.13 	to the extent that the current owner agrees in writing. On all demands, billings, property 
30.14 	tax statements, and related correspondence, the county must list and state separately the 
30.15 	amounts of homestead benefits, penalty, interest and costs being demanded, billed or 
30.16 	assessed.
30.17 	(i) (b) Any amount of homestead benefits recovered by the county from the property 
30.18 	owner shall be distributed to the county, city or town, and school district where the 
30.19 	property is located in the same proportion that each taxing district's levy was to the total 
30.20 	of the three taxing districts' levy for the current year. Any amount recovered attributable 
30.21 	to taconite homestead credit shall be transmitted to the St. Louis County auditor to be 
30.22 	deposited in the taconite property tax relief account. Any amount recovered that is 
30.23 	attributable to supplemental homestead credit is to be transmitted to the commissioner of 
30.24 	revenue for deposit in the general fund of the state treasury. The total amount of penalty 
30.25 	collected must be deposited in the county general fund.
30.26 	(j) (c) If a property owner has applied for more than one homestead and the county 
30.27 	assessors cannot determine which property should be classified as homestead, the county 
30.28 	assessors will refer the information to the commissioner. The commissioner shall make 
30.29 	the determination and notify the counties within 60 days.
30.30 		Subd. 13c.Property lists. (k) In addition to lists of homestead properties, the 
30.31 	commissioner may ask the counties to furnish lists of all properties and the record owners. 
30.32 	The Social Security numbers and federal identification numbers that are maintained by 
30.33 	a county or city assessor for property tax administration purposes, and that may appear 
30.34 	on the lists retain their classification as private or nonpublic data; but may be viewed, 
30.35 	accessed, and used by the county auditor or treasurer of the same county for the limited 
30.36 	purpose of assisting the commissioner in the preparation of microdata samples under 
31.1 	section 270C.12. The commissioner shall use the information provided on the lists as 
31.2 	appropriate under the law, including for the detection of improper claims by owners, or 
31.3 	relatives of owners, under chapter 290A.
31.4 		Subd. 13d.Homestead data. (l) On or before April 30 each year beginning in 2007, 
31.5 	each county must provide the commissioner with the following data for each parcel of 
31.6 	homestead property by electronic means as defined in section 289A.02, subdivision 8:
31.7 	(i) (1) the property identification number assigned to the parcel for purposes of 
31.8 	taxes payable in the current year;
31.9 	(ii) (2) the name and Social Security number of each occupant of homestead property 
31.10 	who is the property owner, property owner's spouse, qualifying relative of a property 
31.11 	owner, or spouse of a qualifying relative;
31.12 	(iii) (3) the classification of the property under section 273.13 for taxes payable 
31.13 	in the current year and in the prior year;
31.14 	(iv) (4) an indication of whether the property was classified as a homestead for 
31.15 	taxes payable in the current year because of occupancy by a relative of the owner or 
31.16 	by a spouse of a relative;
31.17 	(v) (5) the property taxes payable as defined in section 290A.03, subdivision 13, for 
31.18 	the current year and the prior year;
31.19 	(vi) (6) the market value of improvements to the property first assessed for tax 
31.20 	purposes for taxes payable in the current year;
31.21 	(vii) (7) the assessor's estimated market value assigned to the property for taxes 
31.22 	payable in the current year and the prior year;
31.23 	(viii) (8) the taxable market value assigned to the property for taxes payable in the 
31.24 	current year and the prior year;
31.25 	(ix) (9) whether there are delinquent property taxes owing on the homestead;
31.26 	(x) (10) the unique taxing district in which the property is located; and
31.27 	(xi) (11) such other information as the commissioner decides is necessary.
31.28 	The commissioner shall use the information provided on the lists as appropriate 
31.29 	under the law, including for the detection of improper claims by owners, or relatives 
31.30 	of owners, under chapter 290A.

31.31 	EFFECTIVE DATE. This section is effective the day following final enactment.

31.32 	Sec. 8. Minnesota Statutes 2011 Supplement, section 273.13, subdivision 25, is 
31.33 	amended to read:
31.34 		Subd. 25.Class 4. (a) Class 4a is residential real estate containing four or more 
31.35 	units and used or held for use by the owner or by the tenants or lessees of the owner 
32.1 	as a residence for rental periods of 30 days or more, excluding property qualifying for 
32.2 	class 4d. Class 4a also includes hospitals licensed under sections 144.50 to 144.56, other 
32.3 	than hospitals exempt under section 272.02, and contiguous property used for hospital 
32.4 	purposes, without regard to whether the property has been platted or subdivided. The 
32.5 	market value of class 4a property has a class rate of 1.25 percent.
32.6 	(b) Class 4b includes:
32.7 	(1) residential real estate containing less than four units that does not qualify as class 
32.8 	4bb, other than seasonal residential recreational property;
32.9 	(2) manufactured homes not classified under any other provision;
32.10 	(3) a dwelling, garage, and surrounding one acre of property on a nonhomestead 
32.11 	farm classified under subdivision 23, paragraph (b) containing two or three units; and
32.12 	(4) unimproved property that is classified residential as determined under subdivision 
32.13 	33.
32.14 	The market value of class 4b property has a class rate of 1.25 percent.
32.15 	(c) Class 4bb includes:
32.16 	(1) nonhomestead residential real estate containing one unit, other than seasonal 
32.17 	residential recreational property; and
32.18 	(2) a single family dwelling, garage, and surrounding one acre of property on a 
32.19 	nonhomestead farm classified under subdivision 23, paragraph (b).
32.20 	Class 4bb property has the same class rates as class 1a property under subdivision 22.
32.21 	Property that has been classified as seasonal residential recreational property at 
32.22 	any time during which it has been owned by the current owner or spouse of the current 
32.23 	owner does not qualify for class 4bb.
32.24 	(d) Class 4c property includes:
32.25 	(1) except as provided in subdivision 22, paragraph (c), real and personal property 
32.26 	devoted to commercial temporary and seasonal residential occupancy for recreation 
32.27 	purposes, for not more than 250 days in the year preceding the year of assessment. For 
32.28 	purposes of this clause, property is devoted to a commercial purpose on a specific day 
32.29 	if any portion of the property is used for residential occupancy, and a fee is charged for 
32.30 	residential occupancy. Class 4c property under this clause must contain three or more 
32.31 	rental units. A "rental unit" is defined as a cabin, condominium, townhouse, sleeping room, 
32.32 	or individual camping site equipped with water and electrical hookups for recreational 
32.33 	vehicles. A camping pad offered for rent by a property that otherwise qualifies for class 
32.34 	4c under this clause is also class 4c under this clause regardless of the term of the rental 
32.35 	agreement, as long as the use of the camping pad does not exceed 250 days. In order for a 
32.36 	property to be classified under this clause, either (i) the business located on the property 
33.1 	must provide recreational activities, at least 40 percent of the annual gross lodging receipts 
33.2 	related to the property must be from business conducted during 90 consecutive days, 
33.3 	and either (A) at least 60 percent of all paid bookings by lodging guests during the year 
33.4 	must be for periods of at least two consecutive nights; or (B) at least 20 percent of the 
33.5 	annual gross receipts must be from charges for providing recreational activities, or (ii) the 
33.6 	business must contain 20 or fewer rental units, and must be located in a township or a city 
33.7 	with a population of 2,500 or less located outside the metropolitan area, as defined under 
33.8 	section 473.121, subdivision 2, that contains a portion of a state trail administered by the 
33.9 	Department of Natural Resources. For purposes of item (i)(A), a paid booking of five or 
33.10 	more nights shall be counted as two bookings. Class 4c property also includes commercial 
33.11 	use real property used exclusively for recreational purposes in conjunction with other class 
33.12 	4c property classified under this clause and devoted to temporary and seasonal residential 
33.13 	occupancy for recreational purposes, up to a total of two acres, provided the property is 
33.14 	not devoted to commercial recreational use for more than 250 days in the year preceding 
33.15 	the year of assessment and is located within two miles of the class 4c property with which 
33.16 	it is used. In order for a property to qualify for classification under this clause, the owner 
33.17 	must submit a declaration to the assessor designating the cabins or units occupied for 250 
33.18 	days or less in the year preceding the year of assessment by January 15 of the assessment 
33.19 	year. Those cabins or units and a proportionate share of the land on which they are located 
33.20 	must be designated class 4c under this clause as otherwise provided. The remainder of the 
33.21 	cabins or units and a proportionate share of the land on which they are located will be 
33.22 	designated as class 3a. The owner of property desiring designation as class 4c property 
33.23 	under this clause must provide guest registers or other records demonstrating that the units 
33.24 	for which class 4c designation is sought were not occupied for more than 250 days in the 
33.25 	year preceding the assessment if so requested. The portion of a property operated as a 
33.26 	(1) restaurant, (2) bar, (3) gift shop, (4) conference center or meeting room, and (5) other 
33.27 	nonresidential facility operated on a commercial basis not directly related to temporary and 
33.28 	seasonal residential occupancy for recreation purposes does not qualify for class 4c. For 
33.29 	the purposes of this paragraph, "recreational activities" means renting ice fishing houses, 
33.30 	boats and motors, snowmobiles, downhill or cross-country ski equipment; providing 
33.31 	marina services, launch services, or guide services; or selling bait and fishing tackle;
33.32 	(2) qualified property used as a golf course if:
33.33 	(i) it is open to the public on a daily fee basis. It may charge membership fees or 
33.34 	dues, but a membership fee may not be required in order to use the property for golfing, 
33.35 	and its green fees for golfing must be comparable to green fees typically charged by 
33.36 	municipal courses; and
34.1 	(ii) it meets the requirements of section 273.112, subdivision 3, paragraph (d).
34.2 	A structure used as a clubhouse, restaurant, or place of refreshment in conjunction 
34.3 	with the golf course is classified as class 3a property;
34.4 	(3) real property up to a maximum of three acres of land owned and used by a 
34.5 	nonprofit community service oriented organization and not used for residential purposes 
34.6 	on either a temporary or permanent basis, provided that:
34.7 	(i) the property is not used for a revenue-producing activity for more than six days 
34.8 	in the calendar year preceding the year of assessment; or
34.9 	(ii) the organization makes annual charitable contributions and donations at least 
34.10 	equal to the property's previous year's property taxes and the property is allowed to be 
34.11 	used for public and community meetings or events for no charge, as appropriate to the 
34.12 	size of the facility.
34.13 	For purposes of this clause:
34.14 	(A) "charitable contributions and donations" has the same meaning as lawful 
34.15 	gambling purposes under section 349.12, subdivision 25, excluding those purposes 
34.16 	relating to the payment of taxes, assessments, fees, auditing costs, and utility payments;
34.17 	(B) "property taxes" excludes the state general tax;
34.18 	(C) a "nonprofit community service oriented organization" means any corporation, 
34.19 	society, association, foundation, or institution organized and operated exclusively for 
34.20 	charitable, religious, fraternal, civic, or educational purposes, and which is exempt from 
34.21 	federal income taxation pursuant to section 501(c)(3), (8), (10), or (19) of the Internal 
34.22 	Revenue Code; and
34.23 	(D) "revenue-producing activities" shall include but not be limited to property or that 
34.24 	portion of the property that is used as an on-sale intoxicating liquor or 3.2 percent malt 
34.25 	liquor establishment licensed under chapter 340A, a restaurant open to the public, bowling 
34.26 	alley, a retail store, gambling conducted by organizations licensed under chapter 349, an 
34.27 	insurance business, or office or other space leased or rented to a lessee who conducts a 
34.28 	for-profit enterprise on the premises.
34.29 	Any portion of the property not qualifying under either item (i) or (ii) is class 3a. The use 
34.30 	of the property for social events open exclusively to members and their guests for periods 
34.31 	of less than 24 hours, when an admission is not charged nor any revenues are received by 
34.32 	the organization shall not be considered a revenue-producing activity.
34.33 	The organization shall maintain records of its charitable contributions and donations 
34.34 	and of public meetings and events held on the property and make them available upon 
34.35 	request any time to the assessor to ensure eligibility. An organization meeting the 
34.36 	requirement under item (ii) must file an application by May 1 with the assessor for 
35.1 	eligibility for the current year's assessment. The commissioner shall prescribe a uniform 
35.2 	application form and instructions;
35.3 	(4) postsecondary student housing of not more than one acre of land that is owned by 
35.4 	a nonprofit corporation organized under chapter 317A and is used exclusively by a student 
35.5 	cooperative, sorority, or fraternity for on-campus housing or housing located within two 
35.6 	miles of the border of a college campus;
35.7 	(5)(i) manufactured home parks as defined in section 327.14, subdivision 3, 
35.8 	excluding manufactured home parks described in section 273.124, subdivision 3a, and (ii) 
35.9 	manufactured home parks as defined in section 327.14, subdivision 3, that are described in 
35.10 	section 273.124, subdivision 3a;
35.11 	(6) real property that is actively and exclusively devoted to indoor fitness, health, 
35.12 	social, recreational, and related uses, is owned and operated by a not-for-profit corporation, 
35.13 	and is located within the metropolitan area as defined in section 473.121, subdivision 2;
35.14 	(7) a leased or privately owned noncommercial aircraft storage hangar not exempt 
35.15 	under section 272.01, subdivision 2, and the land on which it is located, provided that:
35.16 	(i) the land is on an airport owned or operated by a city, town, county, Metropolitan 
35.17 	Airports Commission, or group thereof; and
35.18 	(ii) the land lease, or any ordinance or signed agreement restricting the use of the 
35.19 	leased premise, prohibits commercial activity performed at the hangar.
35.20 	If a hangar classified under this clause is sold after June 30, 2000, a bill of sale must 
35.21 	be filed by the new owner with the assessor of the county where the property is located 
35.22 	within 60 days of the sale;
35.23 	(8) a privately owned noncommercial aircraft storage hangar not exempt under 
35.24 	section 272.01, subdivision 2, and the land on which it is located, provided that:
35.25 	(i) the land abuts a public airport; and
35.26 	(ii) the owner of the aircraft storage hangar provides the assessor with a signed 
35.27 	agreement restricting the use of the premises, prohibiting commercial use or activity 
35.28 	performed at the hangar; and
35.29 	(9) residential real estate, a portion of which is used by the owner for homestead 
35.30 	purposes, and that is also a place of lodging, if all of the following criteria are met:
35.31 	(i) rooms are provided for rent to transient guests that generally stay for periods 
35.32 	of 14 or fewer days;
35.33 	(ii) meals are provided to persons who rent rooms, the cost of which is incorporated 
35.34 	in the basic room rate;
35.35 	(iii) meals are not provided to the general public except for special events on fewer 
35.36 	than seven days in the calendar year preceding the year of the assessment; and
36.1 	(iv) the owner is the operator of the property.
36.2 	The market value subject to the 4c classification under this clause is limited to five rental 
36.3 	units. Any rental units on the property in excess of five, must be valued and assessed as 
36.4 	class 3a. The portion of the property used for purposes of a homestead by the owner must 
36.5 	be classified as class 1a property under subdivision 22;
36.6 	(10) real property up to a maximum of three acres and operated as a restaurant 
36.7 	as defined under section 157.15, subdivision 12, provided it: (A) is located on a lake 
36.8 	as defined under section 103G.005, subdivision 15, paragraph (a), clause (3); and (B) 
36.9 	is either devoted to commercial purposes for not more than 250 consecutive days, or 
36.10 	receives at least 60 percent of its annual gross receipts from business conducted during 
36.11 	four consecutive months. Gross receipts from the sale of alcoholic beverages must be 
36.12 	included in determining the property's qualification under subitem (B). The property's 
36.13 	primary business must be as a restaurant and not as a bar. Gross receipts from gift shop 
36.14 	sales located on the premises must be excluded. Owners of real property desiring 4c 
36.15 	classification under this clause must submit an annual declaration to the assessor by 
36.16 	February 1 of the current assessment year, based on the property's relevant information for 
36.17 	the preceding assessment year;
36.18 	(11) lakeshore and riparian property and adjacent land, not to exceed six acres, used 
36.19 	as a marina, as defined in section 86A.20, subdivision 5, which is made accessible to 
36.20 	the public and devoted to recreational use for marina services. The marina owner must 
36.21 	annually provide evidence to the assessor that it provides services, including lake or river 
36.22 	access to the public by means of an access ramp or other facility that is either located on 
36.23 	the property of the marina or at a publicly owned site that abuts the property of the marina. 
36.24 	No more than 800 feet of lakeshore may be included in this classification. Buildings used 
36.25 	in conjunction with a marina for marina services, including but not limited to buildings 
36.26 	used to provide food and beverage services, fuel, boat repairs, or the sale of bait or fishing 
36.27 	tackle, are classified as class 3a property; and
36.28 	(12) real and personal property devoted to noncommercial temporary and seasonal 
36.29 	residential occupancy for recreation purposes.
36.30 	Class 4c property has a class rate of 1.5 percent of market value, except that (i) each 
36.31 	parcel of noncommercial seasonal residential recreational property under clause (12) 
36.32 	has the same class rates as class 4bb property, (ii) manufactured home parks assessed 
36.33 	under clause (5), item (i), have the same class rate as class 4b property, and the market 
36.34 	value of manufactured home parks assessed under clause (5), item (ii), has the same class 
36.35 	rate as class 4d property if more than 50 percent of the lots in the park are occupied by 
36.36 	shareholders in the cooperative corporation or association and a class rate of one percent if 
37.1 	50 percent or less of the lots are so occupied, (iii) commercial-use seasonal residential 
37.2 	recreational property and marina recreational land as described in clause (11), has a 
37.3 	class rate of one percent for the first $500,000 of market value, and 1.25 percent for the 
37.4 	remaining market value, (iv) the market value of property described in clause (4) has a 
37.5 	class rate of one percent, (v) the market value of property described in clauses (2), (6), and 
37.6 	(10) has a class rate of 1.25 percent, and (vi) that portion of the market value of property 
37.7 	in clause (9) qualifying for class 4c property has a class rate of 1.25 percent.
37.8 	(e) Class 4d property is qualifying low-income rental housing certified to the assessor 
37.9 	by the Housing Finance Agency under section 273.128, subdivision 3. If only a portion 
37.10 	of the units in the building qualify as low-income rental housing units as certified under 
37.11 	section 273.128, subdivision 3, only the proportion of qualifying units to the total number 
37.12 	of units in the building qualify for class 4d. The remaining portion of the building shall be 
37.13 	classified by the assessor based upon its use. Class 4d also includes the same proportion of 
37.14 	land as the qualifying low-income rental housing units are to the total units in the building. 
37.15 	For all properties qualifying as class 4d, the market value determined by the assessor must 
37.16 	be based on the normal approach to value using normal unrestricted rents.
37.17 	Class 4d property has a class rate of 0.75 percent.

37.18 	EFFECTIVE DATE. This section is effective for taxes payable in 2013 and 
37.19 	thereafter.

37.20 	Sec. 9. Minnesota Statutes 2010, section 273.1315, subdivision 1, is amended to read:
37.21 		Subdivision 1.Class 1b homestead declaration before 2009. Any property owner 
37.22 	seeking classification and assessment of the owner's homestead as class 1b property 
37.23 	pursuant to section 273.13, subdivision 22, paragraph (b), on or before October 1, 2008, 
37.24 	shall file with the commissioner of revenue a 1b homestead declaration, on a form 
37.25 	prescribed by the commissioner. The declaration shall contain the following information:
37.26 	(a) (1) the information necessary to verify that on or before June 30 of the filing year, 
37.27 	the property owner or the owner's spouse satisfies the requirements of section 273.13, 
37.28 	subdivision 22, paragraph (b), for 1b classification; and
37.29 	(b) (2) any additional information prescribed by the commissioner.
37.30 	The declaration must be filed on or before October 1 to be effective for property 
37.31 	taxes payable during the succeeding calendar year. The declaration and any supplementary 
37.32 	information received from the property owner pursuant to this subdivision shall be subject 
37.33 	to chapter 270B. If approved by the commissioner, the declaration remains in effect until 
37.34 	the property no longer qualifies under section 273.13, subdivision 22, paragraph (b). 
37.35 	Failure to notify the commissioner within 30 days that the property no longer qualifies 
38.1 	under that paragraph because of a sale, change in occupancy, or change in the status 
38.2 	or condition of an occupant shall result in the penalty provided in section 273.124, 
38.3 	subdivision 13 13b, computed on the basis of the class 1b benefits for the property, and 
38.4 	the property shall lose its current class 1b classification.
38.5 	The commissioner shall provide to the assessor on or before November 1 a listing 
38.6 	of the parcels of property qualifying for 1b classification.

38.7 	EFFECTIVE DATE. This section is effective the day following final enactment.

38.8 	Sec. 10. Minnesota Statutes 2010, section 273.1315, subdivision 2, is amended to read:
38.9 		Subd. 2.Class 1b homestead declaration 2009 and thereafter. (a) Any property 
38.10 	owner seeking classification and assessment of the owner's homestead as class 1b property 
38.11 	pursuant to section 273.13, subdivision 22, paragraph (b), after October 1, 2008, shall file 
38.12 	with the county assessor a class 1b homestead declaration, on a form prescribed by the 
38.13 	commissioner of revenue. The declaration must contain the following information:
38.14 	(1) the information necessary to verify that, on or before June 30 of the filing year, 
38.15 	the property owner or the owner's spouse satisfies the requirements of section 273.13, 
38.16 	subdivision 22, paragraph (b), for class 1b classification; and
38.17 	(2) any additional information prescribed by the commissioner.
38.18 	(b) The declaration must be filed on or before October 1 to be effective for property 
38.19 	taxes payable during the succeeding calendar year. The Social Security numbers and 
38.20 	income and medical information received from the property owner pursuant to this 
38.21 	subdivision are private data on individuals as defined in section 13.02. If approved by 
38.22 	the assessor, the declaration remains in effect until the property no longer qualifies under 
38.23 	section 273.13, subdivision 22, paragraph (b). Failure to notify the assessor within 30 
38.24 	days that the property no longer qualifies under that paragraph because of a sale, change in 
38.25 	occupancy, or change in the status or condition of an occupant shall result in the penalty 
38.26 	provided in section 273.124, subdivision 13 13b, computed on the basis of the class 1b 
38.27 	benefits for the property, and the property shall lose its current class 1b classification.

38.28 	EFFECTIVE DATE. This section is effective the day following final enactment.

38.29 	Sec. 11. Minnesota Statutes 2010, section 273.19, subdivision 1, is amended to read:
38.30 		Subdivision 1.Tax-exempt property; lease. Except as provided in subdivision 3 or 
38.31 	4, tax-exempt property held under a lease for a term of at least one year, and not taxable 
38.32 	under section 272.01, subdivision 2, or under a contract for the purchase thereof, shall 
38.33 	be considered, for all purposes of taxation, as the property of the person holding it. In 
39.1 	this subdivision, "tax-exempt property" means property owned by the United States, the 
39.2 	state or any of its political subdivisions, a school, or any religious, scientific, or benevolent 
39.3 	society or institution, incorporated or unincorporated, or any corporation whose property 
39.4 	is not taxed in the same manner as other property. This subdivision does not apply to 
39.5 	property exempt from taxation under section 272.01, subdivision 2, paragraph (b), clauses 
39.6 	(2), (3), and (4), or to property exempt from taxation under section 272.0213.

39.7 	EFFECTIVE DATE. This section is effective the day following final enactment.

39.8 	Sec. 12. Minnesota Statutes 2010, section 273.372, subdivision 4, is amended to read:
39.9 		Subd. 4.Administrative appeals. (a) Companies that submit the reports under 
39.10 	section 270.82 or 273.371 by the date specified in that section, or by the date specified by 
39.11 	the commissioner in an extension, may appeal administratively to the commissioner prior 
39.12 	to bringing an action in court by submitting.
39.13 	(b) Companies that must submit reports under section 270.82 must submit a written 
39.14 	request with to the commissioner for a conference within ten days after the date of the 
39.15 	commissioner's valuation certification or notice to the company, or by May June 15, 
39.16 	whichever is earlier.
39.17 	(c) Companies that submit reports under section 273.371 must submit a written 
39.18 	request to the commissioner for a conference within ten days after the date of the 
39.19 	commissioner's valuation certification or notice to the company, or by July 1, whichever 
39.20 	is earlier.
39.21 	(d) The commissioner shall conduct the conference upon the commissioner's entire 
39.22 	files and records and such further information as may be offered. The conference must 
39.23 	be held no later than 20 days after the date of the commissioner's valuation certification 
39.24 	or notice to the company, or by the date specified by the commissioner in an extension. 
39.25 	Within 60 days after the conference the commissioner shall make a final determination of 
39.26 	the matter and shall notify the company promptly of the determination. The conference 
39.27 	is not a contested case hearing.
39.28 	(b) (e) In addition to the opportunity for a conference under paragraph (a), the 
39.29 	commissioner shall also provide the railroad and utility companies the opportunity to 
39.30 	discuss any questions or concerns relating to the values established by the commissioner 
39.31 	through certification or notice in a less formal manner. This does not change or modify 
39.32 	the deadline for requesting a conference under paragraph (a), the deadline in section 
39.33 	271.06 for appealing an order of the commissioner, or the deadline in section 278.01 for 
39.34 	appealing property taxes in court.

40.1 	EFFECTIVE DATE. This section is effective beginning with assessment year 2013.

40.2 	Sec. 13. Minnesota Statutes 2010, section 273.39, is amended to read:
40.3 	273.39 RURAL AREA.
40.4 	As used in sections 273.39 to 273.41, the term "rural area" shall be deemed to mean 
40.5 	any area of the state not included within the boundaries of any incorporated statutory 
40.6 	city or home rule charter city, and such term shall be deemed to include both farm and 
40.7 	nonfarm population thereof.

40.8 	EFFECTIVE DATE. This section is effective beginning with assessment year 2012.

40.9 	Sec. 14. Minnesota Statutes 2010, section 279.06, subdivision 1, is amended to read:
40.10 		Subdivision 1.List and notice. Within five days after the filing of such list, the 
40.11 	court administrator shall return a copy thereof to the county auditor, with a notice prepared 
40.12 	and signed by the court administrator, and attached thereto, which may be substantially in 
40.13 	the following form:

40.14	State of Minnesota
	)
			
40.15		) ss.
			
40.16	County of 
........	)
			
40.17				District Court
	
40.18				........Judicial District.
	
40.19 	The state of Minnesota, to all persons, companies, or corporations who have or claim 
40.20 	any estate, right, title, or interest in, claim to, or lien upon, any of the several parcels of 
40.21 	land described in the list hereto attached:
40.22 	The list of taxes and penalties on real property for the county of ............................... 
40.23 	remaining delinquent on the first Monday in January, ......., has been filed in the office of 
40.24 	the court administrator of the district court of said county, of which that hereto attached is a 
40.25 	copy. Therefore, you, and each of you, are hereby required to file in the office of said court 
40.26 	administrator, on or before the 20th day after the publication of this notice and list, your 
40.27 	answer, in writing, setting forth any objection or defense you may have to the taxes, or any 
40.28 	part thereof, upon any parcel of land described in the list, in, to, or on which you have or 
40.29 	claim any estate, right, title, interest, claim, or lien, and, in default thereof, judgment will 
40.30 	be entered against such parcel of land for the taxes on such list appearing against it, and 
40.31 	for all penalties, interest, and costs. Based upon said judgment, the land shall be sold to 
40.32 	the state of Minnesota on the second Monday in May, ....... The period of redemption for 
40.33 	all lands sold to the state at a tax judgment sale shall be three years from the date of sale to 
40.34 	the state of Minnesota if the land is within an incorporated area unless it is:
41.1 	(a) nonagricultural homesteaded land as defined in section 273.13, subdivision 22;
41.2 	(b) homesteaded agricultural land as defined in section 273.13, subdivision 23, 
41.3 	paragraph (a);
41.4 	(c) seasonal residential recreational land as defined in section 273.13, subdivisions 
41.5 	22, paragraph (c), and 25, paragraph (d), clause (1), in which event the period of 
41.6 	redemption is five years from the date of sale to the state of Minnesota;
41.7 	(d) abandoned property and pursuant to section 281.173 a court order has been 
41.8 	entered shortening the redemption period to five weeks; or
41.9 	(e) vacant property as described under section 281.174, subdivision 2, and for which 
41.10 	a court order is entered shortening the redemption period under section 281.174.
41.11 	The period of redemption for all other lands sold to the state at a tax judgment sale 
41.12 	shall be five years from the date of sale.
41.13 	Inquiries as to the proceedings set forth above can be made to the county auditor of 
41.14 	..... county whose address is ......

41.15		(Signed) ........,
	
41.16
41.17		Court Administrator of the District Court of the
County of 
........	
41.18		(Here insert list.)
	
41.19 	The notice must contain a narrative description of the various periods to redeem 
41.20 	specified in sections 281.17, 281.173, and 281.174, in the manner prescribed by the 
41.21 	commissioner of revenue under subdivision 2.
41.22 	The list referred to in the notice shall be substantially in the following form:
41.23 	List of real property for the county of ......................., on which taxes remain 
41.24 	delinquent on the first Monday in January, .......
41.25 	Town of (Fairfield),
41.26 	Township (40), Range (20),

41.27
41.28
41.29
41.30
41.31
41.32
41.33
41.34	Names (and Current 
Filed Addresses) for 
the Taxpayers and Fee 
Owners and in Addition 
Those Parties Who Have 
Filed Their Addresses 
Pursuant to section 
276.041
	Subdivision of
Section
	Section
	Tax Parcel
Number
	Total Tax 
and Penalty
	
41.35					$ cts.

41.36
41.37	John Jones (825 Fremont 
Fairfield, MN 55000)
	S.E. 1/4 of S.W. 1/4
	10
	23101
	2.20

42.1
42.2
42.3
42.4
42.5
42.6
42.7
42.8
42.942.10
42.11
42.12
42.13
42.14
42.15
42.16
42.17
42.18
42.19
	Bruce Smith (2059 Hand 
Fairfield, MN 55000) 
and Fairfield State 
Bank (100 Main Street 
Fairfield, MN 55000)
	That part of N.E. 1/4 
of S.W. 1/4 desc. as 
follows: Beg. at the 
S.E. corner of said N.E. 
1/4 of S.W. 1/4; thence 
N. along the E. line of 
said N.E. 1/4 of S.W. 
1/4 a distance of 600 
ft.; thence W. parallel 
with the S. line of said 
N.E. 1/4 of S.W. 1/4 
a distance of 600 ft.; 
thence S. parallel with 
said E. line a distance of 
600 ft. to S. line of said 
N.E. 1/4 of S.W. 1/4; 
thence E. along said S. 
line a distance of 600 ft. 
to the point of beg.
	21
	33211
	3.15
	
42.20 	As to platted property, the form of heading shall conform to circumstances and be 
42.21 	substantially in the following form:
42.22 	City of (Smithtown)
42.23 	Brown's Addition, or Subdivision

42.24
42.25
42.26
42.27
42.28
42.29
42.30
42.31	Names (and Current 
Filed Addresses) for 
the Taxpayers and Fee 
Owners and in Addition 
Those Parties Who Have 
Filed Their Addresses 
Pursuant to section 
276.041
	Lot
	Block
	Tax Parcel
Number
	Total Tax
and Penalty
	
42.32					$ cts.

42.33
42.34	John Jones (825 Fremont 
Fairfield, MN 55000)
	15
	9
	58243
	2.20
	
42.35
42.36
42.37
42.38
42.39	Bruce Smith (2059 Hand 
Fairfield, MN 55000) 
and Fairfield State 
Bank (100 Main Street 
Fairfield, MN 55000)
	16
	9
	58244
	3.15
	
42.40 	The names, descriptions, and figures employed in parentheses in the above forms are 
42.41 	merely for purposes of illustration.
42.42 	The name of the town, township, range or city, and addition or subdivision, as the 
42.43 	case may be, shall be repeated at the head of each column of the printed lists as brought 
42.44 	forward from the preceding column.
42.45 	Errors in the list shall not be deemed to be a material defect to affect the validity 
42.46 	of the judgment and sale.

43.1 	EFFECTIVE DATE. This section is effective for lists and notices required after 
43.2 	December 31, 2012.

43.3 	Sec. 15. Minnesota Statutes 2010, section 290A.25, is amended to read:
43.4 	290A.25 VERIFICATION OF SOCIAL SECURITY NUMBERS.
43.5 	Annually, the commissioner of revenue shall furnish a list to the county assessor 
43.6 	containing the names and Social Security numbers of persons who have applied for both 
43.7 	homestead classification under section 273.13 and a property tax refund as a renter 
43.8 	under this chapter.
43.9 	Within 90 days of the notification, the county assessor shall investigate to determine 
43.10 	if the homestead classification was improperly claimed. If the property owner does 
43.11 	not qualify, the county assessor shall notify the county auditor who will determine the 
43.12 	amount of homestead benefits that has been improperly allowed. For the purpose of this 
43.13 	section, "homestead benefits" has the meaning given in section 273.124, subdivision 
43.14 	13, paragraph (h) 13b. The county auditor shall send a notice to persons who owned the 
43.15 	affected property at the time the homestead application related to the improper homestead 
43.16 	was filed, demanding reimbursement of the homestead benefits plus a penalty equal to 
43.17 	100 percent of the homestead benefits. The person notified may appeal the county's 
43.18 	determination with the Minnesota Tax Court within 60 days of the date of the notice from 
43.19 	the county as provided in section 273.124, subdivision 13, paragraph (h) 13b.
43.20 	If the amount of homestead benefits and penalty is not paid within 60 days, and if 
43.21 	no appeal has been filed, the county auditor shall certify the amount of taxes and penalty 
43.22 	to the county treasurer. The county treasurer will add interest to the unpaid homestead 
43.23 	benefits and penalty amounts at the rate provided for delinquent personal property taxes 
43.24 	for the period beginning 60 days after demand for payment was made until payment. If 
43.25 	the person notified is the current owner of the property, the treasurer may add the total 
43.26 	amount of benefits, penalty, interest, and costs to the real estate taxes otherwise payable on 
43.27 	the property in the following year. If the person notified is not the current owner of the 
43.28 	property, the treasurer may collect the amounts due under the Revenue Recapture Act in 
43.29 	chapter 270A, or use any of the powers granted in sections 277.20 and 277.21 without 
43.30 	exclusion, to enforce payment of the benefits, penalty, interest, and costs, as if those 
43.31 	amounts were delinquent tax obligations of the person who owned the property at the time 
43.32 	the application related to the improperly allowed homestead was filed. The treasurer may 
43.33 	relieve a prior owner of personal liability for the benefits, penalty, interest, and costs, and 
43.34 	instead extend those amounts on the tax lists against the property for taxes payable in the 
43.35 	following year to the extent that the current owner agrees in writing.
44.1 	Any amount of homestead benefits recovered by the county from the property owner 
44.2 	shall be distributed to the county, city or town, and school district where the property is 
44.3 	located in the same proportion that each taxing district's levy was to the total of the three 
44.4 	taxing districts' levy for the current year. Any amount recovered attributable to taconite 
44.5 	homestead credit shall be transmitted to the St. Louis County auditor to be deposited in 
44.6 	the taconite property tax relief account. Any amount recovered that is attributable to 
44.7 	supplemental homestead credit is to be transmitted to the commissioner of revenue for 
44.8 	deposit in the general fund of the state treasury. The total amount of penalty collected 
44.9 	must be deposited in the county general fund.

44.10 	EFFECTIVE DATE. This section is effective the day following final enactment.

44.11 	Sec. 16. Minnesota Statutes 2010, section 290B.04, subdivision 2, is amended to read:
44.12 		Subd. 2.Approval; recording. The commissioner shall approve all initial 
44.13 	applications that qualify under this chapter and shall notify qualifying homeowners on or 
44.14 	before December 1. The commissioner may investigate the facts or require confirmation 
44.15 	in regard to an application. The commissioner shall record or file a notice of qualification 
44.16 	for deferral, including the names of the qualifying homeowners and a legal description 
44.17 	of the property, in the office of the county recorder, or registrar of titles, whichever is 
44.18 	applicable, in the county where the qualifying property is located. The notice must state 
44.19 	that it serves as a notice of lien and that it includes deferrals under this section for future 
44.20 	years. The commissioner shall prescribe the form of the notice. Execution of the notice 
44.21 	by the original or facsimile signature of the commissioner or a delegate entitles them to 
44.22 	be recorded, and no other attestation, certification, or acknowledgment is necessary. The 
44.23 	homeowner shall pay the recording or filing fees for the notice, which, notwithstanding 
44.24 	section 357.18, shall be paid by the homeowner at the time of satisfaction of the lien.

44.25 	EFFECTIVE DATE. This section is effective for notices that are both executed 
44.26 	and recorded after June 30, 2012.

44.27 	Sec. 17. Minnesota Statutes 2011 Supplement, section 373.01, subdivision 1, is 
44.28 	amended to read:
44.29 		Subdivision 1.Public corporation; listed powers. (a) Each county is a body politic 
44.30 	and corporate and may:
44.31 	(1) Sue and be sued.
44.32 	(2) Acquire and hold real and personal property for the use of the county, and lands 
44.33 	sold for taxes as provided by law.
45.1 	(3) Purchase and hold for the benefit of the county real estate sold by virtue of 
45.2 	judicial proceedings, to which the county is a party.
45.3 	(4) Sell, lease, and convey real or personal estate owned by the county, and give 
45.4 	contracts or options to sell, lease, or convey it, and make orders respecting it as deemed 
45.5 	conducive to the interests of the county's inhabitants.
45.6 	(5) Make all contracts and do all other acts in relation to the property and concerns 
45.7 	of the county necessary to the exercise of its corporate powers.
45.8 	(b) No sale, lease, or conveyance of real estate owned by the county, except the lease 
45.9 	of a residence acquired for the furtherance of an approved capital improvement project, nor 
45.10 	any contract or option for it, shall be valid, without first advertising for bids or proposals in 
45.11 	the official newspaper of the county for three consecutive weeks and once in a newspaper 
45.12 	of general circulation in the area where the property is located. The notice shall state the 
45.13 	time and place of considering the proposals, contain a legal description of any real estate, 
45.14 	and a brief description of any personal property. Leases that do not exceed $15,000 for any 
45.15 	one year may be negotiated and are not subject to the competitive bid procedures of this 
45.16 	section. All proposals estimated to exceed $15,000 in any one year shall be considered at 
45.17 	the time set for the bid opening, and the one most favorable to the county accepted, but the 
45.18 	county board may, in the interest of the county, reject any or all proposals.
45.19 	(c) Sales of personal property the value of which is estimated to be $15,000 or 
45.20 	more shall be made only after advertising for bids or proposals in the county's official 
45.21 	newspaper, on the county's Web site, or in a recognized industry trade journal. At the same 
45.22 	time it posts on its Web site or publishes in a trade journal, the county must publish in the 
45.23 	official newspaper, either as part of the minutes of a regular meeting of the county board 
45.24 	or in a separate notice, a summary of all requests for bids or proposals that the county 
45.25 	advertises on its Web site or in a trade journal. After publication in the official newspaper, 
45.26 	on the Web site, or in a trade journal, bids or proposals may be solicited and accepted by 
45.27 	the electronic selling process authorized in section 471.345, subdivision 17. Sales of 
45.28 	personal property the value of which is estimated to be less than $15,000 may be made 
45.29 	either on competitive bids or in the open market, in the discretion of the county board. 
45.30 	"Web site" means a specific, addressable location provided on a server connected to the 
45.31 	Internet and hosting World Wide Web pages and other files that are generally accessible 
45.32 	on the Internet all or most of a day.
45.33 	(d) Notwithstanding anything to the contrary herein, the county may, when acquiring 
45.34 	real property for county highway right-of-way, exchange parcels of real property of 
45.35 	substantially similar or equal value without advertising for bids. The estimated values for 
45.36 	these parcels shall be determined by the county assessor.
46.1 	(e) Notwithstanding anything in this section to the contrary, the county may, when 
46.2 	acquiring real property for purposes other than county highway right-of-way, exchange 
46.3 	parcels of real property of substantially similar or equal value without advertising for bids. 
46.4 	The estimated values for these parcels must be determined by the county assessor or a 
46.5 	private appraisal performed by a licensed Minnesota real estate appraiser. For the purpose 
46.6 	of making these estimates, the county assessor need not be licensed under chapter 82B. 
46.7 	Before giving final approval to any exchange of land, the county board shall hold a public 
46.8 	hearing on the exchange. At least two weeks before the hearing, the county auditor shall 
46.9 	post a notice in the auditor's office and the official newspaper of the county of the hearing 
46.10 	that contains a description of the lands affected.
46.11 	(f) If real estate or personal property remains unsold after advertising for and 
46.12 	consideration of bids or proposals the county may employ a broker to sell the property. 
46.13 	The broker may sell the property for not less than 90 percent of its appraised market value 
46.14 	as determined by the county. The broker's fee shall be set by agreement with the county but 
46.15 	may not exceed ten percent of the sale price and must be paid from the proceeds of the sale.
46.16 	(g) A county or its agent may rent a county-owned residence acquired for the 
46.17 	furtherance of an approved capital improvement project subject to the conditions set 
46.18 	by the county board and not subject to the conditions for lease otherwise provided by 
46.19 	paragraph (a), clause (4), and paragraphs (b), (c), (d), (f), and (h).
46.20 	(h) In no case shall lands be disposed of without there being reserved to the county 
46.21 	all iron ore and other valuable minerals in and upon the lands, with right to explore for, 
46.22 	mine and remove the iron ore and other valuable minerals, nor shall the minerals and 
46.23 	mineral rights be disposed of, either before or after disposition of the surface rights, 
46.24 	otherwise than by mining lease, in similar general form to that provided by section 93.20 
46.25 	for mining leases affecting state lands. The lease shall be for a term not exceeding 50 
46.26 	years, and be issued on a royalty basis, the royalty to be not less than 25 cents per ton of 
46.27 	2,240 pounds, and fix a minimum amount of royalty payable during each year, whether 
46.28 	mineral is removed or not. Prospecting options for mining leases may be granted for 
46.29 	periods not exceeding one year. The options shall require, among other things, periodical 
46.30 	showings to the county board of the results of exploration work done.
46.31 	(i) Notwithstanding anything in this subdivision to the contrary, the county may, 
46.32 	when selling real property owned in fee simple that cannot be improved because of 
46.33 	noncompliance with local ordinances regarding minimum area, shape, frontage, or access, 
46.34 	proceed to sell the nonconforming parcel without advertising for bid. At the county's 
46.35 	discretion, the real property may be restricted to sale to adjoining landowners or may be 
46.36 	sold to any other interested party. The property shall be sold to the highest bidder, but 
47.1 	in no case shall the property be sold for less than 90 percent of its fair market value as 
47.2 	determined by the county assessor. All owners of land adjoining the land to be sold shall 
47.3 	be given a written notice at least 30 days before the sale. This paragraph shall be liberally 
47.4 	construed to encourage the sale of nonconforming real property and promote its return to 
47.5 	the tax roles.

47.6 	EFFECTIVE DATE. This section is effective the day following final enactment.

47.7 	Sec. 18.  REPEALER.
 47.8 	(a) Minnesota Statutes 2010, section 272.69, is repealed.
47.9 	(b) Minnesota Statutes 2010, section 273.11, subdivision 22, is repealed.

47.10 	EFFECTIVE DATE. Paragraph (a) is effective the day following final enactment. 
47.11 	Paragraph (b) is effective for taxes payable in 2013 and thereafter.

47.12 	ARTICLE 3
47.13 	DEPARTMENT POLICY AND TECHNICAL: SALES AND USE 
47.14 	TAXES; SPECIAL TAXES

47.15 	Section 1. Minnesota Statutes 2010, section 65B.84, subdivision 1, is amended to read:
47.16 		Subdivision 1.Program described; commissioner's duties; appropriation. (a) 
47.17 	The commissioner of commerce shall:
47.18 	(1) develop and sponsor the implementation of statewide plans, programs, and 
47.19 	strategies to combat automobile theft, improve the administration of the automobile theft 
47.20 	laws, and provide a forum for identification of critical problems for those persons dealing 
47.21 	with automobile theft;
47.22 	(2) coordinate the development, adoption, and implementation of plans, programs, 
47.23 	and strategies relating to interagency and intergovernmental cooperation with respect 
47.24 	to automobile theft enforcement;
47.25 	(3) annually audit the plans and programs that have been funded in whole or in part 
47.26 	to evaluate the effectiveness of the plans and programs and withdraw funding should the 
47.27 	commissioner determine that a plan or program is ineffective or is no longer in need 
47.28 	of further financial support from the fund;
47.29 	(4) develop a plan of operation including:
47.30 	(i) an assessment of the scope of the problem of automobile theft, including areas 
47.31 	of the state where the problem is greatest;
47.32 	(ii) an analysis of various methods of combating the problem of automobile theft;
47.33 	(iii) a plan for providing financial support to combat automobile theft;
48.1 	(iv) a plan for eliminating car hijacking; and
48.2 	(v) an estimate of the funds required to implement the plan; and
48.3 	(5) distribute money, in consultation with the commissioner of public safety, 
48.4 	pursuant to subdivision 3 from the automobile theft prevention special revenue account 
48.5 	for automobile theft prevention activities, including:
48.6 	(i) paying the administrative costs of the program;
48.7 	(ii) providing financial support to the State Patrol and local law enforcement 
48.8 	agencies for automobile theft enforcement teams;
48.9 	(iii) providing financial support to state or local law enforcement agencies for 
48.10 	programs designed to reduce the incidence of automobile theft and for improved 
48.11 	equipment and techniques for responding to automobile thefts;
48.12 	(iv) providing financial support to local prosecutors for programs designed to reduce 
48.13 	the incidence of automobile theft;
48.14 	(v) providing financial support to judicial agencies for programs designed to reduce 
48.15 	the incidence of automobile theft;
48.16 	(vi) providing financial support for neighborhood or community organizations or 
48.17 	business organizations for programs designed to reduce the incidence of automobile 
48.18 	theft and to educate people about the common methods of automobile theft, the models 
48.19 	of automobiles most likely to be stolen, and the times and places automobile theft is 
48.20 	most likely to occur; and
48.21 	(vii) providing financial support for automobile theft educational and training 
48.22 	programs for state and local law enforcement officials, driver and vehicle services exam 
48.23 	and inspections staff, and members of the judiciary.
48.24 	(b) The commissioner may not spend in any fiscal year more than ten percent of the 
48.25 	money in the fund for the program's administrative and operating costs. The commissioner 
48.26 	is annually appropriated and must distribute the amount of the proceeds credited to 
48.27 	the automobile theft prevention special revenue account each year, less the transfer 
48.28 	of $1,300,000 each year to the general fund described in section 168A.40, subdivision 
48.29 	4 297I.11, subdivision 2.

48.30 	EFFECTIVE DATE. This section is effective for premiums collected after June 
48.31 	30, 2012.

48.32 	Sec. 2. Minnesota Statutes 2010, section 287.20, is amended by adding a subdivision 
48.33 	to read:
48.34 		Subd. 11.Partition. "Partition" means the division by conveyance of real property 
48.35 	that is held jointly or in common by two or more persons into individually owned interests. 
49.1 	If one of the co-owners gives consideration for all or a part of the individually owned 
49.2 	interest conveyed to them, that portion of the conveyance is not a part of the partition.

49.3 	EFFECTIVE DATE. This section is effective the day following final enactment.

49.4 	Sec. 3. Minnesota Statutes 2010, section 297A.665, is amended to read:
49.5 	297A.665 PRESUMPTION OF TAX; BURDEN OF PROOF.
49.6 	(a) For the purpose of the proper administration of this chapter and to prevent 
49.7 	evasion of the tax, until the contrary is established, it is presumed that:
49.8 	(1) all gross receipts are subject to the tax; and
49.9 	(2) all retail sales for delivery in Minnesota are for storage, use, or other consumption 
49.10 	in Minnesota.
49.11 	(b) The burden of proving that a sale is not a taxable retail sale is on the seller. 
49.12 	However, a seller is relieved of liability if:
49.13 	(1) the seller obtains a fully completed exemption certificate or all the relevant 
49.14 	information required by section 297A.72, subdivision 2, at the time of the sale or within 
49.15 	90 days after the date of the sale; or
49.16 	(2) if the seller has not obtained a fully completed exemption certificate or all the 
49.17 	relevant information required by section 297A.72, subdivision 2, within the time provided 
49.18 	in clause (1), within 120 days after a request for substantiation by the commissioner, 
49.19 	the seller either:
49.20 	(i) obtains in good faith from the purchaser a fully completed exemption certificate 
49.21 	or all the relevant information required by section 297A.72, subdivision 2, from the 
49.22 	purchaser taken in good faith which means that the exemption certificate claims an 
49.23 	exemption that (A) was statutorily available on the date of the transaction, (B) could be 
49.24 	applicable to the item for which the exemption is claimed, and (C) is reasonable for the 
49.25 	purchaser's type of business; or
49.26 	(ii) proves by other means that the transaction was not subject to tax.
49.27 	(c) Notwithstanding paragraph (b), relief from liability does not apply to a seller who:
49.28 	(1) fraudulently fails to collect the tax; or
49.29 	(2) solicits purchasers to participate in the unlawful claim of an exemption.
49.30 	(d) Notwithstanding paragraph (b), relief from liability does not apply to a seller 
49.31 	who has obtained information under paragraph (b), clause (2), if through the audit process 
49.32 	the commissioner finds the following:
49.33 	(1) that at the time the information was provided the seller had knowledge or had 
49.34 	reason to know that the information relating to the exemption was materially false; or
50.1 	(2) that the seller knowingly participated in activity intended to purposefully evade 
50.2 	the sales tax due on the transaction.
50.3 	(d) (e) A certified service provider, as defined in section 297A.995, subdivision 2, is 
50.4 	relieved of liability under this section to the extent a seller who is its client is relieved of 
50.5 	liability.
50.6 	(e) (f) A purchaser of tangible personal property or any items listed in section 
50.7 	297A.63 that are shipped or brought to Minnesota by the purchaser has the burden 
50.8 	of proving that the property was not purchased from a retailer for storage, use, or 
50.9 	consumption in Minnesota.
50.10 	(f) (g) If a seller claims that certain sales are exempt and does not provide the 
50.11 	certificate, information, or proof required by paragraph (b), clause (2), within 120 days 
50.12 	after the date of the commissioner's request for substantiation, then the exemptions 
50.13 	claimed by the seller that required substantiation are disallowed.

50.14 	EFFECTIVE DATE. This section is effective the day following final enactment.

50.15 	Sec. 4. Minnesota Statutes 2010, section 297F.01, subdivision 23, is amended to read:
50.16 		Subd. 23.Wholesale sales price. "Wholesale sales price" means the price stated on 
50.17 	the price list in effect at the time of sale for which a manufacturer or person sells a tobacco 
50.18 	product to a distributor, exclusive of any discount, promotional offer, or other reduction. 
50.19 	For purposes of this subdivision, "price list" means the manufacturer's price at which 
50.20 	tobacco products are made available for sale to all distributors on an ongoing basis at which 
50.21 	a distributor purchases a tobacco product without any reduction for federal excise taxes, 
50.22 	freight charges, discounts, packaging, or other reductions. Wholesale sales price includes 
50.23 	the applicable federal excise tax regardless of whether it is included in the purchase price.

50.24 	EFFECTIVE DATE. This section is effective for purchases made after December 
50.25 	31, 2012.

50.26 	Sec. 5. Minnesota Statutes 2010, section 297G.04, subdivision 2, is amended to read:
50.27 		Subd. 2.Tax credit. A qualified brewer producing fermented malt beverages 
50.28 	is entitled to a tax credit of $4.60 per barrel on 25,000 barrels sold in any fiscal year 
50.29 	beginning July 1, regardless of the alcohol content of the product. Qualified brewers may 
50.30 	take the credit on the 18th day of each month, but the total credit allowed may not exceed 
50.31 	in any fiscal year the lesser of:
50.32 	(1) the liability for tax; or
50.33 	(2) $115,000.
51.1 	For purposes of this subdivision, a "qualified brewer" means a brewer, whether 
51.2 	or not located in this state, manufacturing less than 100,000 barrels of fermented malt 
51.3 	beverages in the calendar year immediately preceding the calendar fiscal year for which 
51.4 	the credit under this subdivision is claimed. In determining the number of barrels, all 
51.5 	brands or labels of a brewer must be combined. All facilities for the manufacture of 
51.6 	fermented malt beverages owned or controlled by the same person, corporation, or other 
51.7 	entity must be treated as a single brewer. A brewer is owned or controlled when more than 
51.8 	50 percent of the voting stock of each member of the group is directly or indirectly owned 
51.9 	by a common owner or by common owners, whether they are corporate or noncorporate.

51.10 	EFFECTIVE DATE. This section is effective for claims filed after December 
51.11 	31, 2012.

51.12 	Sec. 6. Minnesota Statutes 2011 Supplement, section 297I.05, subdivision 7, is 
51.13 	amended to read:
51.14 		Subd. 7.Nonadmitted insurance premium tax. (a) A tax is imposed on surplus 
51.15 	lines brokers. The rate of tax is equal to three percent of the gross premiums less return 
51.16 	premiums paid by an insured whose home state is Minnesota.
51.17 	(b) A tax is imposed on persons, firms, or corporations a person, firm, corporation, 
51.18 	or purchasing group as defined in section 60E.02, or any member of a purchasing group,
51.19 	that procure insurance directly from a nonadmitted insurer. The rate of tax is equal to two 
51.20 	percent of the gross premiums less return premiums paid by an insured whose home 
51.21 	state is Minnesota.
51.22 	(c) No state other than the home state of an insured may require any premium tax 
51.23 	payment for nonadmitted insurance. When Minnesota is the home state of the insured, 
51.24 	as provided under section 297I.01, 100 percent of the gross premiums are taxable in 
51.25 	Minnesota with no allocation of the tax to other states.

51.26 	EFFECTIVE DATE. This section is effective for premiums received after 
51.27 	December 31, 2012.

51.28 	Sec. 7. Minnesota Statutes 2010, section 297I.05, subdivision 11, is amended to read:
51.29 		Subd. 11.Retaliatory provisions. (a) If any other state or country imposes any 
51.30 	taxes, fines, deposits, penalties, licenses, or fees upon any insurance companies of this 
51.31 	state and their agents doing business in another state or country that are in addition to or in 
51.32 	excess of those imposed by the laws of this state upon foreign insurance companies and 
51.33 	their agents doing business in this state, the same taxes, fines, deposits, penalties, licenses, 
52.1 	and fees are imposed upon every similar insurance company of that state or country and 
52.2 	their agents doing or applying to do business in this state.
52.3 	(b) If any conditions precedent to the right to do business in any other state or 
52.4 	country are imposed by the laws of that state or country, beyond those imposed upon 
52.5 	foreign companies by the laws of this state, the same conditions precedent are imposed 
52.6 	upon every similar insurance company of that state or country and their agents doing or 
52.7 	applying to do business in that state.
52.8 	(c) For purposes of this subdivision, "taxes, fines, deposits, penalties, licenses, or 
52.9 	fees" means an amount of money that is deposited in the general revenue fund of the state 
52.10 	or other similar fund in another state or country and is not dedicated to a special purpose 
52.11 	or use or money deposited in the general revenue fund of the state or other similar fund in 
52.12 	another state or country and appropriated to the commissioner of commerce or insurance 
52.13 	for the operation of the Department of Commerce or other similar agency with jurisdiction 
52.14 	over insurance. Taxes, fines, deposits, penalties, licenses, or fees do not include:
52.15 	(1) special purpose obligations or assessments imposed in connection with particular 
52.16 	kinds of insurance, including but not limited to assessments imposed in connection with 
52.17 	residual market mechanisms; or
52.18 	(2) assessments made by the insurance guaranty association, life and health 
52.19 	guarantee association, or similar association.
52.20 	(d) This subdivision applies to taxes imposed under subdivisions 1,; 3,; 4, 6, and; 12, 
52.21 	paragraph (a), clauses (1) and (2); and 14.
52.22 	(e) This subdivision does not apply to insurance companies organized or domiciled 
52.23 	in a state or country, the laws of which do not impose retaliatory taxes, fines, deposits, 
52.24 	penalties, licenses, or fees or which grant, on a reciprocal basis, exemptions from 
52.25 	retaliatory taxes, fines, deposits, penalties, licenses, or fees to insurance companies 
52.26 	domiciled in this state.

52.27 	EFFECTIVE DATE. This section is effective the day following final enactment.

52.28 	Sec. 8. Minnesota Statutes 2011 Supplement, section 297I.05, subdivision 12, is 
52.29 	amended to read:
52.30 		Subd. 12.Other entities. (a) A tax is imposed equal to two percent of:
52.31 	(1) gross premiums less return premiums written for risks resident or located in 
52.32 	Minnesota by a risk retention group;
52.33 	(2) gross premiums less return premiums received by an attorney in fact acting 
52.34 	in accordance with chapter 71A;
53.1 	(3) gross premiums less return premiums received pursuant to assigned risk policies 
53.2 	and contracts of coverage under chapter 79; and
53.3 	(4) the direct funded premium received by the reinsurance association under section 
53.4 	79.34 from self-insurers approved under section 176.181 and political subdivisions that 
53.5 	self-insure; and.
53.6 	(5) gross premiums less return premiums paid to an insurer other than a licensed 
53.7 	insurance company or a surplus lines broker for coverage of risks resident or located in 
53.8 	Minnesota by a purchasing group or any members of the purchasing group to a broker or 
53.9 	agent for the purchasing group.
53.10 	(b) A tax is imposed on a joint self-insurance plan operating under chapter 60F. The 
53.11 	rate of tax is equal to two percent of the total amount of claims paid during the fund year, 
53.12 	with no deduction for claims wholly or partially reimbursed through stop-loss insurance.
53.13 	(c) A tax is imposed on a joint self-insurance plan operating under chapter 62H. 
53.14 	The rate of tax is equal to two percent of the total amount of claims paid during the 
53.15 	fund's fiscal year, with no deduction for claims wholly or partially reimbursed through 
53.16 	stop-loss insurance.
53.17 	(d) A tax is imposed equal to the tax imposed under section 297I.05, subdivision 5, 
53.18 	on the gross premiums less return premiums on all coverages received by an accountable 
53.19 	provider network or agents of an accountable provider network in Minnesota, in cash or 
53.20 	otherwise, during the year.

53.21 	EFFECTIVE DATE. This section is effective for premiums received after 
53.22 	December 31, 2012.

53.23 	Sec. 9. [297I.11] AUTOMOBILE THEFT PREVENTION SURCHARGE.
53.24 		Subdivision 1.Surcharge. Each insurer engaged in the writing of policies of 
53.25 	automobile insurance shall collect a surcharge, at the rate of 50 cents per vehicle 
53.26 	for every six months of coverage, on each policy of automobile insurance providing 
53.27 	comprehensive insurance coverage issued or renewed in this state. The surcharge may not 
53.28 	be considered premium for any purpose, including the computation of premium tax or 
53.29 	agents' commissions. The amount of the surcharge must be separately stated on either a 
53.30 	billing or policy declaration sent to an insured. Insurers shall remit the revenue derived 
53.31 	from this surcharge to the commissioner of revenue for purposes of the automobile theft 
53.32 	prevention program described in section 65B.84. For purposes of this subdivision, "policy 
53.33 	of automobile insurance" has the meaning given it in section 65B.14, covering only the 
53.34 	following types of vehicles as defined in section 168.002:
53.35 	(1) a passenger automobile;
54.1 	(2) a pickup truck;
54.2 	(3) a van but not commuter vans as defined in section 168.126; or
54.3 	(4) a motorcycle,
54.4 	except that no vehicle with a gross vehicle weight in excess of 10,000 pounds is included 
54.5 	within this definition.
54.6 		Subd. 2.Automobile theft prevention account. A special revenue account in 
54.7 	the state treasury shall be credited with the proceeds of the surcharge imposed under 
54.8 	subdivision 1. Of the revenue in the account, $1,300,000 each year must be transferred to 
54.9 	the general fund. Revenues in excess of $1,300,000 each year may be used only for the 
54.10 	automobile theft prevention program described in section 65B.84.
54.11 		Subd. 3.Collection and administration. The commissioner shall collect and 
54.12 	administer the surcharge imposed by this section in the same manner as the taxes imposed 
54.13 	by this chapter. The commissioner is appropriated annually, from the automobile theft 
54.14 	prevention special revenue account, an amount to reimburse the Department of Revenue 
54.15 	for the costs incurred in administering and collecting the surcharge imposed under 
54.16 	subdivision 1.

54.17 	EFFECTIVE DATE. This section is effective for premiums collected after June 
54.18 	30, 2012.

54.19 	Sec. 10. Minnesota Statutes 2011 Supplement, section 297I.30, subdivision 1, is 
54.20 	amended to read:
54.21 		Subdivision 1.General rule. On or before March 1, every taxpayer subject to 
54.22 	taxation under section 297I.05, subdivisions 1 to 5,; 7, paragraph (b),; 12, paragraphs (a), 
54.23 	clauses (1) to (4), (b), (c), and (d),; and 14, shall file an annual return for the preceding 
54.24 	calendar year in the form prescribed by the commissioner.

54.25 	EFFECTIVE DATE. This section is effective for premiums received after 
54.26 	December 31, 2012.

54.27 	Sec. 11. Minnesota Statutes 2011 Supplement, section 297I.30, subdivision 2, is 
54.28 	amended to read:
54.29 		Subd. 2.Surplus lines brokers and purchasing groups. On or before February 
54.30 	15 and August 15 of each year, every surplus lines broker subject to taxation under 
54.31 	section 297I.05, subdivision 7, paragraph (a), and every purchasing group or member of 
54.32 	a purchasing group subject to tax under section 297I.05, subdivision 12, paragraph (a), 
55.1 	clause (5), shall file a return with the commissioner for the preceding six-month period 
55.2 	ending December 31, or June 30, in the form prescribed by the commissioner.

55.3 	EFFECTIVE DATE. This section is effective for premiums received after 
55.4 	December 31, 2012.

55.5 	Sec. 12. Minnesota Statutes 2010, section 297I.30, is amended by adding a subdivision 
55.6 	to read:
55.7 		Subd. 10.Automobile theft prevention surcharge. On or before May 1, August 
55.8 	1, November 1, and February 1 of each year, every insurer required to pay the surcharge 
55.9 	under section 297I.11 shall file a return with the commissioner for the preceding 
55.10 	three-month period ending March 31, June 30, September 30, and December 31, in the 
55.11 	form prescribed by the commissioner.

55.12 	EFFECTIVE DATE. This section is effective for premiums collected after June 
55.13 	30, 2012.

55.14 	Sec. 13.  REPEALER.
 55.15 	Minnesota Statutes 2010, section 168A.40, subdivisions 3 and 4, are repealed.

55.16 	EFFECTIVE DATE. This section is effective for premiums collected after June 
55.17 	30, 2012. 

55.18 	ARTICLE 4
55.19 	DEPARTMENT POLICY AND TECHNICAL: MINERALS

55.20 	Section 1. Minnesota Statutes 2011 Supplement, section 272.02, subdivision 97, 
55.21 	is amended to read:
55.22 		Subd. 97.Property used in business of mining subject to net proceeds tax. The 
55.23 	following property used in the business of mining that is subject to the net proceeds tax 
55.24 	under section 298.015 is exempt:
55.25 	(1) deposits of ores, metals, and minerals and the lands in which they are contained;
55.26 	(2) all real and personal property used in mining, quarrying, producing, or refining 
55.27 	ores, minerals, or metals, including lands occupied by or used in connection with the 
55.28 	mining, quarrying, production, or ore refining facilities; and
55.29 	(3) concentrate or direct reduced ore.
56.1 	This exemption applies for each year that a person subject to tax under section 
56.2 	298.015 uses the property for mining, quarrying, producing, or refining ores, metals, or 
56.3 	minerals.

56.4 	EFFECTIVE DATE. This section is effective the day following final enactment.

56.5 	Sec. 2. Minnesota Statutes 2011 Supplement, section 298.01, subdivision 3, is 
56.6 	amended to read:
56.7 		Subd. 3.Occupation tax; other ores.  Every person engaged in the business of 
56.8 	mining, refining, or producing ores, metals, or minerals in this state, except iron ore or 
56.9 	taconite concentrates, shall pay an occupation tax to the state of Minnesota as provided 
56.10 	in this subdivision. For purposes of this subdivision, mining includes the application of 
56.11 	hydrometallurgical processes. Hydrometallurgical processes are processes that extract 
56.12 	the ores, metals, or minerals, by use of aqueous solutions that leach, concentrate, and 
56.13 	recover the ore, metal, or mineral. The tax is determined in the same manner as the tax 
56.14 	imposed by section 290.02, except that sections 290.05, subdivision 1, clause (a), 290.17, 
56.15 	subdivision 4, and 290.191, subdivision 2, do not apply, and the occupation tax must 
56.16 	be computed by applying to taxable income the rate of 2.45 percent. A person subject 
56.17 	to occupation tax under this section shall apportion its net income on the basis of the 
56.18 	percentage obtained by taking the sum of:
56.19 	(1) 75 percent of the percentage which the sales made within this state in connection 
56.20 	with the trade or business during the tax period are of the total sales wherever made in 
56.21 	connection with the trade or business during the tax period;
56.22 	(2) 12.5 percent of the percentage which the total tangible property used by the 
56.23 	taxpayer in this state in connection with the trade or business during the tax period is of 
56.24 	the total tangible property, wherever located, used by the taxpayer in connection with the 
56.25 	trade or business during the tax period; and
56.26 	(3) 12.5 percent of the percentage which the taxpayer's total payrolls paid or incurred 
56.27 	in this state or paid in respect to labor performed in this state in connection with the trade 
56.28 	or business during the tax period are of the taxpayer's total payrolls paid or incurred in 
56.29 	connection with the trade or business during the tax period.
56.30 	The tax is in addition to all other taxes.

56.31 	EFFECTIVE DATE. This section is effective the day following final enactment.

56.32 	Sec. 3. Minnesota Statutes 2010, section 298.018, subdivision 2, is amended to read:
57.1 		Subd. 2.Outside taconite assistance area. The proceeds of the tax paid under 
57.2 	sections 298.015 to 298.017 on ores, metals, or minerals and energy resources mined 
57.3 	or extracted outside of the taconite assistance area defined in section 273.1341, shall 
57.4 	be deposited in the general fund.

57.5 	EFFECTIVE DATE. This section is effective the day following final enactment.

57.6 	ARTICLE 5
57.7 	DEPARTMENT POLICY AND TECHNICAL: MISCELLANEOUS

57.8 	Section 1. Minnesota Statutes 2010, section 16A.46, is amended to read:
57.9 	16A.46 LOST OR DESTROYED WARRANT DUPLICATE; INDEMNITY.
57.10 		Subdivision 1.Duplicate warrant. The commissioner may issue a duplicate 
57.11 	of an unpaid warrant to an owner if the owner certifies that the original was lost or 
57.12 	destroyed. The commissioner may require certification be documented by affidavit.
57.13 	The commissioner may refuse to issue a duplicate of an unpaid state warrant. If the 
57.14 	commissioner acts in good faith the commissioner is not liable, whether the application is 
57.15 	granted or denied.
57.16 		Subd. 2.Original warrant is void. When the duplicate is issued, the original is 
57.17 	void. The commissioner may require an indemnity bond from the applicant to the state for 
57.18 	double the amount of the warrant for anyone damaged by the issuance of the duplicate. 
57.19 	The commissioner may refuse to issue a duplicate of an unpaid state warrant. If the 
57.20 	commissioner acts in good faith the commissioner is not liable, whether the application is 
57.21 	granted or denied is not liable to any holder who took the void original warrant for value, 
57.22 	whether the commissioner required an indemnity bond from the applicant or not.
57.23 		Subd. 3.Unpaid refund or rebate. For an unpaid refund or rebate issued under a 
57.24 	tax law administered by the commissioner of revenue that has been lost or destroyed, an 
57.25 	affidavit is not required for the commissioner to issue a duplicate if the duplicate is issued 
57.26 	to the same name and Social Security number as the original warrant and that information 
57.27 	is verified on a tax return filed by the recipient.

57.28 	EFFECTIVE DATE. This section is effective the day following final enactment.

57.29 	Sec. 2. Minnesota Statutes 2010, section 270C.38, subdivision 1, is amended to read:
57.30 		Subdivision 1.Sufficient notice. (a) If no method of notification of a written 
57.31 	determination or action of the commissioner is otherwise specifically provided for by 
57.32 	law, notice of the determination or action sent postage prepaid by United States mail to 
58.1 	the taxpayer or other person affected by the determination or action at the taxpayer's 
58.2 	or person's last known address, is sufficient. If the taxpayer or person being notified is 
58.3 	deceased or is under a legal disability, or, in the case of a corporation being notified that 
58.4 	has terminated its existence, notice to the last known address of the taxpayer, person, or 
58.5 	corporation is sufficient, unless the department has been provided with a new address by a 
58.6 	party authorized to receive notices from the commissioner.
58.7 	(b) If a taxpayer or other person agrees to accept notification by electronic means, 
58.8 	notice of a determination or action of the commissioner sent by electronic mail to the 
58.9 	taxpayer's or person's last known electronic mailing address as provided for in section 
58.10 	325L.08 is sufficient.

58.11 	EFFECTIVE DATE. This section is effective the day following final enactment.

58.12 	Sec. 3. Minnesota Statutes 2010, section 270C.42, subdivision 2, is amended to read:
58.13 		Subd. 2.Penalty for failure to pay electronically. In addition to other applicable 
58.14 	penalties imposed by law, after notification from the commissioner to the taxpayer that 
58.15 	payments for a tax payable to the commissioner are required to be made by electronic 
58.16 	means, and the payments are remitted by some other means, there is a penalty in the 
58.17 	amount of five percent of each payment that should have been remitted electronically. 
58.18 	After the commissioner's initial notification to the taxpayer that payments are required to 
58.19 	be made by electronic means, the commissioner is not required to notify the taxpayer in 
58.20 	subsequent periods if the initial notification specified the amount of tax liability at which a 
58.21 	taxpayer is required to remit payments by electronic means. The penalty can be abated 
58.22 	under the abatement procedures prescribed in section 270C.34 if the failure to remit the 
58.23 	payment electronically is due to reasonable cause. The penalty bears interest at the rate 
58.24 	specified in section 270C.40 from the due date of the payment of the tax provided in 
58.25 	section 270C.40, subdivision 3, to the date of payment of the penalty.

58.26 	EFFECTIVE DATE. This section is effective the day following final enactment.

58.27 	Sec. 4. Minnesota Statutes 2010, section 270C.69, subdivision 1, is amended to read:
58.28 		Subdivision 1.Notice and procedures. (a) The commissioner may, within five years 
58.29 	after the date of assessment of the tax, or if a lien has been filed under section 270C.63, 
58.30 	within the statutory period for enforcement of the lien, give notice to any employer 
58.31 	deriving income which has a taxable situs in this state regardless of whether the income is 
58.32 	exempt from taxation, that an employee of that employer is delinquent in a certain amount 
58.33 	with respect to any taxes, including penalties, interest, and costs. The commissioner can 
59.1 	proceed under this section only if the tax is uncontested or if the time for appeal of the tax 
59.2 	has expired. The commissioner shall not proceed under this section until the expiration of 
59.3 	30 days after mailing to the taxpayer, at the taxpayer's last known address, a written notice 
59.4 	of (1) the amount of taxes, interest, and penalties due from the taxpayer and demand for 
59.5 	their payment, and (2) the commissioner's intention to require additional withholding by 
59.6 	the taxpayer's employer pursuant to this section. The effect of the notice shall expire one 
59.7 	year after it has been mailed to the taxpayer provided that the notice may be renewed by 
59.8 	mailing a new notice which is in accordance with this section. The renewed notice shall 
59.9 	have the effect of reinstating the priority of the original claim. The notice to the taxpayer 
59.10 	shall be in substantially the same form as that provided in section 571.72. The notice 
59.11 	shall further inform the taxpayer of the wage exemptions contained in section 550.37, 
59.12 	subdivision 14. If no statement of exemption is received by the commissioner within 30 
59.13 	days from the mailing of the notice, the commissioner may proceed under this section. 
59.14 	The notice to the taxpayer's employer may be served by mail or by delivery by an agent of 
59.15 	the department and shall be in substantially the same form as provided in section 571.75. 
59.16 	Upon receipt of notice, the employer shall withhold from compensation due or to become 
59.17 	due to the employee, the total amount shown by the notice, subject to the provisions of 
59.18 	section 571.922. The employer shall continue to withhold each pay period until the notice 
59.19 	is released by the commissioner under section 270C.7109. Upon receipt of notice by the 
59.20 	employer, the claim of the state of Minnesota shall have priority over any subsequent 
59.21 	garnishments or wage assignments. The commissioner may arrange between the employer 
59.22 	and the employee for withholding a portion of the total amount due the employee each pay 
59.23 	period, until the total amount shown by the notice plus accrued interest has been withheld.
59.24 	(b) The "compensation due" any employee is defined in accordance with the 
59.25 	provisions of section 571.921. The maximum withholding allowed under this section for 
59.26 	any one pay period shall be decreased by any amounts payable pursuant to a garnishment 
59.27 	action with respect to which the employer was served prior to being served with the notice 
59.28 	of delinquency and any amounts covered by any irrevocable and previously effective 
59.29 	assignment of wages; the employer shall give notice to the commissioner of the amounts 
59.30 	and the facts relating to such assignments within ten days after the service of the notice of 
59.31 	delinquency on the form provided by the commissioner as noted in this section.
59.32 	(c) Within ten days after the expiration of such pay period, the employer shall remit 
59.33 	to the commissioner, on a form and in the manner prescribed by the commissioner, the 
59.34 	amount withheld during each pay period under this section. The employer must file all 
59.35 	wage levy disclosure forms and remit all wage levy payments by electronic means.

60.1 	EFFECTIVE DATE. This section is effective for wage levy disclosures or wage 
60.2 	levy payments filed or made after December 31, 2012.

60.3 	Sec. 5. Minnesota Statutes 2010, section 287.385, subdivision 7, is amended to read:
60.4 		Subd. 7.Interest on penalties. A penalty imposed under this chapter bears interest 
60.5 	from the date payment was required to be paid, including any extensions,provided in 
60.6 	section 270C.40, subdivision 3, to the date of payment of the penalty.

60.7 	EFFECTIVE DATE. This section is effective the day following final enactment.

60.8 	Sec. 6. Minnesota Statutes 2010, section 289A.55, subdivision 9, is amended to read:
60.9 		Subd. 9.Interest on penalties. (a) A penalty imposed under section 289A.60, 
60.10 	subdivision 1, 2, 2a, 4, 5, 6, or 21 bears interest from the date the return or payment 
60.11 	was required to be filed or paid, including any extensions provided in section 270C.40, 
60.12 	subdivision 3, to the date of payment of the penalty.
60.13 	(b) A penalty not included in paragraph (a) bears interest only if it is not paid within 
60.14 	60 days from the date of notice. In that case interest is imposed from the date of notice 
60.15 	to the date of payment.

60.16 	EFFECTIVE DATE. This section is effective the day following final enactment.

60.17 	Sec. 7. Minnesota Statutes 2010, section 289A.60, subdivision 4, is amended to read:
60.18 		Subd. 4.Substantial understatement of liability; penalty. (a) The commissioner 
60.19 	of revenue shall impose a penalty for substantial understatement of any tax payable to the 
60.20 	commissioner, except a tax imposed under chapter 297A.
60.21 	(b) There must be added to the tax an amount equal to 20 percent of the amount of any 
60.22 	underpayment attributable to the understatement. There is a substantial understatement of 
60.23 	tax for the period if the amount of the understatement for the period exceeds the greater of:
60.24 	(1) ten percent of the tax required to be shown on the return for the period; or
60.25 	(2)(i) $10,000 in the case of a mining company or a corporation, other than an S 
60.26 	corporation as defined in section 290.9725, when the tax is imposed by chapter 290 or 
60.27 	section 298.01 or 298.015, or
60.28 	(ii) $5,000 in the case of any other taxpayer, and in the case of a mining company or 
60.29 	a corporation any tax not imposed by chapter 290 or section 298.01 or 298.015.
60.30 	(c) For a corporation, other than an S corporation, there is also a substantial 
60.31 	understatement of tax for any taxable year if the amount of the understatement for the 
60.32 	taxable year exceeds the lesser of:
61.1 	(1) ten percent of the tax required to be shown on the return for the taxable year 
61.2 	(or, if greater, $10,000); or
61.3 	(2) $10,000,000.
61.4 	(d) The term "understatement" means the excess of the amount of the tax required 
61.5 	to be shown on the return for the period, over the amount of the tax imposed that is 
61.6 	shown on the return. The excess must be determined without regard to items to which 
61.7 	subdivision 27 applies. The amount of the understatement shall be reduced by that part of 
61.8 	the understatement that is attributable to the tax treatment of any item by the taxpayer if 
61.9 	(1) there is or was substantial authority for the treatment, or (2)(i) any item with respect to 
61.10 	which the relevant facts affecting the item's tax treatment are adequately disclosed in the 
61.11 	return or in a statement attached to the return and (ii) there is a reasonable basis for the tax 
61.12 	treatment of the item. The exception for substantial authority under clause (1) does not 
61.13 	apply to positions listed by the Secretary of the Treasury under section 6662(d)(3) of the 
61.14 	Internal Revenue Code. A corporation does not have a reasonable basis for its tax treatment 
61.15 	of an item attributable to a multiple-party financing transaction if the treatment does not 
61.16 	clearly reflect the income of the corporation within the meaning of section 6662(d)(2)(B) 
61.17 	of the Internal Revenue Code. The special rules in cases involving tax shelters provided in 
61.18 	section 6662(d)(2)(C) of the Internal Revenue Code shall apply and shall apply to a tax 
61.19 	shelter the principal purpose of which is the avoidance or evasion of state taxes.
61.20 	(e) The commissioner may abate all or any part of the addition to the tax provided 
61.21 	by this section on a showing by the taxpayer that there was reasonable cause for the 
61.22 	understatement, or part of it, and that the taxpayer acted in good faith. The additional tax 
61.23 	and penalty shall bear interest at the rate as specified in section 270C.40from the time 
61.24 	the tax should have been paid until paid.

61.25 	EFFECTIVE DATE. This section is effective the day following final enactment.

61.26 	Sec. 8. Minnesota Statutes 2010, section 296A.22, is amended to read:
61.27 	296A.22 NONPAYMENT OF TAX; CIVIL PENALTIES.
61.28 		Subdivision 1.Penalty for failure to pay tax, general rule. Upon the failure of 
61.29 	any person to pay any tax or fee when due, a penalty of one percent per day for the first 
61.30 	ten days of delinquency shall accrue, and thereafter the tax, fees, and penalty shall bear 
61.31 	interest at the rate specified in section 270C.40 until paid.
61.32 		Subd. 2.Collection authority. Upon such a failure to pay any tax or fees within the 
61.33 	time provided by this chapter, all taxes and fees imposed by this chapter shall become 
61.34 	immediately due and payable, and may be collected as provided in chapter 270C.
62.1 		Subd. 3.Operating without license. If any person operates as a distributor, special 
62.2 	fuel dealer, bulk purchaser, or motor carrier without first securing the license required 
62.3 	under this chapter, any tax or fee imposed by this chapter shall become immediately due 
62.4 	and payable. A penalty of 25 percent is imposed upon the tax and fee due. The tax, and
62.5 	fees, and penalty shall bear interest at the rate specified in section 270C.40. The penalty 
62.6 	imposed in this subdivision shall bear interest from the date provided in section 270C.40, 
62.7 	subdivision 3, to the date of payment of the penalty.
62.8 		Subd. 4.Unlawful use of dyed fuel. (a) If any dyed fuel is sold or held for sale by a 
62.9 	person for any use which the person knows or has reason to know is not a nontaxable use 
62.10 	of the fuel; or if any dyed fuel is held for use or used in a licensed motor vehicle or for any 
62.11 	other use by a person for a use other than a nontaxable use and the person knew, or had 
62.12 	reason to know, that the fuel was so dyed; or if a person willfully alters, or attempts to 
62.13 	alter, the strength or composition of any dye or marking in any dyed fuel, then the person 
62.14 	shall pay a penalty in addition to the tax, if any.
62.15 	(b) Except as provided in paragraph (c), the amount of penalty under paragraph (a) 
62.16 	for each act is the greater of $1,000, or $10 for each gallon of dyed fuel involved.
62.17 	(c) With regard to a multiple violation under paragraph (a), the penalty shall be 
62.18 	applied by increasing the amount in paragraph (b) by the product of (1) such amount, and 
62.19 	(2) the number of prior penalties, if any, imposed by this section on the person, or a related 
62.20 	person, or any predecessor of the person or related person.
62.21 	(d) If a penalty is imposed under this subdivision on a business entity, each officer, 
62.22 	employee, or agent of the entity who willfully participated in any act giving rise to the 
62.23 	penalty is jointly and severally liable with the entity for the penalty.
62.24 		Subd. 5.Receiver appointed. In the event a suit is instituted as provided in 
62.25 	subdivision 2, the court shall, upon application, appoint a receiver of the property and 
62.26 	business of the delinquent defendant for the purpose of impounding the same as security 
62.27 	for any judgment which has been or may be recovered.
62.28 		Subd. 6.Sale prohibited under certain conditions. No petroleum product shall 
62.29 	be unloaded or sold by any person or distributor whose tax and fees are the basis for 
62.30 	collection action under subdivision 2.
62.31 		Subd. 7.Payment of penalties. The penalties imposed by this section are collected 
62.32 	and paid in the same manner as taxes.
62.33 		Subd. 8.Penalties are additional. The civil penalties imposed by this section are in 
62.34 	addition to the criminal penalties imposed by this chapter.
63.1 		Subd. 9.Abatement of penalty. (a) The commissioner may by written order 
63.2 	abate any penalty imposed under this section, if in the commissioner's opinion there is 
63.3 	reasonable cause to do so.
63.4 	(b) A request for abatement of penalty must be filed with the commissioner within 
63.5 	60 days of the date the notice stating that a penalty has been imposed was mailed to 
63.6 	the taxpayer's last known address.
63.7 	(c) If the commissioner issues an order denying a request for abatement of penalty, 
63.8 	the taxpayer may file an administrative appeal as provided in section 270C.35 or appeal to 
63.9 	Tax Court as provided in section 271.06. If the commissioner does not issue an order on 
63.10 	the abatement request within 60 days from the date the request is received, the taxpayer 
63.11 	may appeal to Tax Court as provided in section 271.06.

63.12 	EFFECTIVE DATE. This section is effective the day following final enactment.

63.13 	Sec. 9. Minnesota Statutes 2010, section 297E.14, subdivision 7, is amended to read:
63.14 		Subd. 7.Interest on penalties. (a) A penalty imposed under section 297E.12, 
63.15 	subdivision 1, 2, 3, 4, or 5, bears interest from the date the return or payment was required 
63.16 	to be filed or paid, including any extensions provided in section 270C.40, subdivision 3, to 
63.17 	the date of payment of the penalty.
63.18 	(b) A penalty not included in paragraph (a) bears interest only if it is not paid within 
63.19 	ten days from the date of notice. In that case interest is imposed from the date of notice 
63.20 	to the date of payment.

63.21 	EFFECTIVE DATE. This section is effective the day following final enactment.

63.22 	Sec. 10. Minnesota Statutes 2010, section 297F.09, subdivision 9, is amended to read:
63.23 		Subd. 9.Interest. The amount of tax not timely paid, together with any penalty 
63.24 	imposed in this section, bears interest at the rate specified in section 270C.40 from the 
63.25 	time such tax should have been paid until paid. The penalty imposed in this section bears 
63.26 	interest at the rate specified in section 270C.40 from the date provided in section 270C.40, 
63.27 	subdivision 3, to the date of payment of the penalty. Any interest and penalty is added to 
63.28 	the tax and collected as a part of it.

63.29 	EFFECTIVE DATE. This section is effective the day following final enactment.

63.30 	Sec. 11. Minnesota Statutes 2010, section 297F.18, subdivision 7, is amended to read:
63.31 		Subd. 7.Interest on penalties. (a) A penalty imposed under section 297F.19, 
63.32 	subdivisions 2 to 7, bears interest from the date the return or payment was required to be 
64.1 	filed or paid, including any extensions provided in section 270C.40, subdivision 3, to the 
64.2 	date of payment of the penalty.
64.3 	(b) A penalty not included in paragraph (a) bears interest only if it is not paid within 
64.4 	ten days from the date of the notice. In that case interest is imposed from the date of notice 
64.5 	to the date of payment.

64.6 	EFFECTIVE DATE. This section is effective the day following final enactment.

64.7 	Sec. 12. Minnesota Statutes 2010, section 297G.09, subdivision 8, is amended to read:
64.8 		Subd. 8.Interest. The amount of tax not timely paid, together with any penalty 
64.9 	imposed by this chapter, bears interest at the rate specified in section 270C.40 from the 
64.10 	time the tax should have been paid until paid. Any penalty imposed by this chapter bears 
64.11 	interest from the date provided in section 270C.40, subdivision 3, to the date of payment 
64.12 	of the penalty. Any interest and penalty is added to the tax and collected as a part of it.

64.13 	EFFECTIVE DATE. This section is effective the day following final enactment.

64.14 	Sec. 13. Minnesota Statutes 2010, section 297G.17, subdivision 7, is amended to read:
64.15 		Subd. 7.Interest on penalties. (a) A penalty imposed under section 297G.18, 
64.16 	subdivisions 2 to 7, bears interest from the date the return or payment was required to be 
64.17 	filed or paid, including any extensions provided in section 270C.40, subdivision 3, to the 
64.18 	date of payment of the penalty.
64.19 	(b) A penalty not included in paragraph (a) bears interest only if it is not paid within 
64.20 	ten days from the date of the notice. In that case interest is imposed from the date of notice 
64.21 	to the date of payment.

64.22 	EFFECTIVE DATE. This section is effective the day following final enactment.

64.23 	Sec. 14. Minnesota Statutes 2010, section 297I.80, subdivision 1, is amended to read:
64.24 		Subdivision 1.Payable to commissioner. (a) When interest is required under this 
64.25 	section, interest is computed at the rate specified in section 270C.40.
64.26 	(b) If a tax or surcharge is not paid within the time named by law for payment, the 
64.27 	unpaid tax or surcharge bears interest from the date the tax or surcharge should have been 
64.28 	paid until the date the tax or surcharge is paid.
64.29 	(c) Whenever a taxpayer is liable for additional tax or surcharge because of a 
64.30 	redetermination by the commissioner or other reason, the additional tax or surcharge 
64.31 	bears interest from the time the tax or surcharge should have been paid until the date the 
64.32 	tax or surcharge is paid.
65.1 	(d) A penalty bears interest from the date the return or payment was required to be 
65.2 	filed or paid provided in section 270C.40, subdivision 3, to the date of payment of the 
65.3 	penalty.

65.4 	EFFECTIVE DATE. This section is effective the day following final enactment.

65.5 	ARTICLE 6
65.6 	PUBLIC FINANCE

65.7 	Section 1. Minnesota Statutes 2010, section 373.40, subdivision 1, is amended to read:
65.8 		Subdivision 1.Definitions. For purposes of this section, the following terms have 
65.9 	the meanings given.
65.10 	(a) "Bonds" means an obligation as defined under section 475.51.
65.11 	(b) "Capital improvement" means acquisition or betterment of public lands, 
65.12 	buildings, or other improvements within the county for the purpose of a county courthouse, 
65.13 	administrative building, health or social service facility, correctional facility, jail, law 
65.14 	enforcement center, hospital, morgue, library, park, qualified indoor ice arena, roads 
65.15 	and bridges, public works facilities, fairgrounds buildings, and records and data storage 
65.16 	facilities, and the acquisition of development rights in the form of conservation easements 
65.17 	under chapter 84C. An improvement must have an expected useful life of five years or 
65.18 	more to qualify. "Capital improvement" does not include a recreation or sports facility 
65.19 	building (such as, but not limited to, a gymnasium, ice arena, racquet sports facility, 
65.20 	swimming pool, exercise room or health spa), unless the building is part of an outdoor 
65.21 	park facility and is incidental to the primary purpose of outdoor recreation.
65.22 	(c) "Metropolitan county" means a county located in the seven-county metropolitan 
65.23 	area as defined in section 473.121 or a county with a population of 90,000 or more.
65.24 	(d) "Population" means the population established by the most recent of the 
65.25 	following (determined as of the date the resolution authorizing the bonds was adopted):
65.26 	(1) the federal decennial census,
65.27 	(2) a special census conducted under contract by the United States Bureau of the 
65.28 	Census, or
65.29 	(3) a population estimate made either by the Metropolitan Council or by the state 
65.30 	demographer under section 4A.02.
65.31 	(e) "Qualified indoor ice arena" means a facility that meets the requirements of 
65.32 	section 373.43.
65.33 	(f) "Tax capacity" means total taxable market value, but does not include captured 
65.34 	market value.

66.1 	Sec. 2. Minnesota Statutes 2010, section 373.40, subdivision 2, is amended to read:
66.2 		Subd. 2.Application of election requirement. (a) Bonds issued by a county 
66.3 	to finance capital improvements under an approved capital improvement plan are not 
66.4 	subject to the election requirements of section 375.18 or 475.58. The bonds must be 
66.5 	approved by vote of at least three-fifths of the members of the county board. In the case 
66.6 	of a metropolitan county, the bonds must be approved by vote of at least two-thirds of 
66.7 	the members of the county board.
66.8 	(b) Before issuance of bonds qualifying under this section, the county must publish 
66.9 	a notice of its intention to issue the bonds and the date and time of a hearing to obtain 
66.10 	public comment on the matter. The notice must be published in the official newspaper 
66.11 	of the county or in a newspaper of general circulation in the county. The notice must be 
66.12 	published at least 14, but not more than 28, days before the date of the hearing.
66.13 	(c) A county may issue the bonds only upon obtaining the approval of a majority of 
66.14 	the voters voting on the question of issuing the obligations, if a petition requesting a vote 
66.15 	on the issuance is signed by voters equal to five percent of the votes cast in the county in 
66.16 	the last county general election and is filed with the county auditor within 30 days after 
66.17 	the public hearing. The commissioner of revenue shall prepare a suggested form of the 
66.18 	question to be presented at the election If the county elects not to submit the question to 
66.19 	the voters, the county shall not propose the issuance of bonds under this section for the 
66.20 	same purpose and in the same amount for a period of 365 days from the date of receipt 
66.21 	of the petition. If the question of issuing the bonds is submitted and not approved by the 
66.22 	voters, the provisions of section 475.58, subdivision 1a, apply.

66.23 	Sec. 3. Minnesota Statutes 2010, section 373.40, subdivision 4, is amended to read:
66.24 		Subd. 4.Limitations on amount. A county may not issue bonds under this section 
66.25 	if the maximum amount of principal and interest to become due in any year on all the 
66.26 	outstanding bonds issued pursuant to this section (including the bonds to be issued) will 
66.27 	equal or exceed 0.12 percent of taxable market value of property in the county. Calculation 
66.28 	of the limit must be made using the taxable market value for the taxes payable year in 
66.29 	which the obligations are issued and sold, provided that, for purposes of determining 
66.30 	the principal and interest due in any year, the county may deduct the amount of interest 
66.31 	expected to be paid or reimbursed to the county by the federal government in that year on 
66.32 	any outstanding bonds or the bonds to be issued. This section does not limit the authority 
66.33 	to issue bonds under any other special or general law.

66.34 	Sec. 4. Minnesota Statutes 2010, section 474A.02, subdivision 23a, is amended to read:
67.1 		Subd. 23a.Qualified bonds. "Qualified bonds" means the specific type or types 
67.2 	of obligations that are subject to the annual volume cap. Qualified bonds include the 
67.3 	following types of obligations as defined in federal tax law:
67.4 	(a) "public facility bonds" means "exempt facility bonds" as defined in federal 
67.5 	tax law, except for residential rental project bonds, which are those obligations issued 
67.6 	to finance airports, docks and wharves, mass commuting facilities, facilities for the 
67.7 	furnishing of water, sewage facilities, solid waste disposal facilities, facilities for the 
67.8 	local furnishing of electric energy or gas, local district heating or cooling facilities, and 
67.9 	qualified hazardous waste facilities. New bonds and other obligations are ineligible to 
67.10 	receive state allocations or entitlement authority for public facility projects under this 
67.11 	section if they have been issued:
67.12 	(1) for the purpose of refinancing, refunding, or otherwise defeasing existing debt; 
67.13 	and
67.14 	(2) more than one calendar year prior to the date of application;
67.15 	(b) "residential rental project bonds" which are those obligations issued to finance 
67.16 	qualified residential rental projects;
67.17 	(c) "mortgage bonds";
67.18 	(d) "small issue bonds" issued to finance manufacturing projects and the acquisition 
67.19 	or improvement of agricultural real or personal property under sections 41C.01 to 41C.13;
67.20 	(e) "student loan bonds" issued by or on behalf of the Minnesota Office of Higher 
67.21 	Education;
67.22 	(f) "redevelopment bonds";
67.23 	(g) "governmental bonds" with a nonqualified amount in excess of $15,000,000 as 
67.24 	set forth in section 141(b)5 of federal tax law; and
67.25 	(h) "enterprise zone facility bonds" issued to finance facilities located within 
67.26 	empowerment zones or enterprise communities, as authorized under Public Law 103-66, 
67.27 	section 13301 section 1394 of the Internal Revenue Code.

67.28 	Sec. 5. Minnesota Statutes 2010, section 474A.04, subdivision 1a, is amended to read:
67.29 		Subd. 1a.Entitlement reservations; carryforward; deduction. Any amount 
67.30 	returned by an entitlement issuer before July 15 shall be reallocated through the housing 
67.31 	pool. Any amount returned on or after July 15 shall be reallocated through the unified 
67.32 	pool. An amount returned after the last Monday in November shall be reallocated to the 
67.33 	Minnesota housing finance agency. Any amount of bonding authority that an entitlement 
67.34 	issuer carries forward under federal tax law that is not permanently issued or for which 
67.35 	the governing body of the entitlement issuer has not enacted a resolution electing to use 
68.1 	the authority for mortgage credit certificates and has not provided a notice of issue to the 
68.2 	commissioner before 4:30 p.m. on the last business day in December of the succeeding 
68.3 	calendar year shall be deducted from the entitlement allocation for that entitlement issuer 
68.4 	in the next succeeding calendar year. Any amount deducted from an entitlement issuer's 
68.5 	allocation under this subdivision shall be reallocated to other entitlement issuers, the 
68.6 	housing pool, the small issue pool, and the public facilities pool on a proportional basis 
68.7 	consistent with section 474A.03.

68.8 	EFFECTIVE DATE. This section is effective the day following final enactment 
68.9 	and applies to any bonding authority allocated in 2011 and subsequent years.

68.10 	Sec. 6. Minnesota Statutes 2010, section 474A.062, is amended to read:
68.11 	474A.062 MINNESOTA OFFICE OF HIGHER EDUCATION 120-DAY 
68.12 	ISSUANCE EXEMPTION.
68.13 	The Minnesota Office of Higher Education is exempt from the 120-day issuance 
68.14 	requirements in this chapter and may carry forward allocations for student loan bonds 
68.15 	into one successive calendar year, subject to carryforward notice requirements of section 
68.16 	474A.131, subdivision 2.

68.17 	EFFECTIVE DATE. This section is effective the day following final enactment 
68.18 	and applies to any bonding authority allocated in 2011 and subsequent years.

68.19 	Sec. 7. Minnesota Statutes 2010, section 474A.091, subdivision 3a, is amended to read:
68.20 		Subd. 3a.Mortgage bonds. (a) Bonding authority remaining in the unified pool on 
68.21 	October 1 is available for single-family housing programs for cities that applied in January 
68.22 	and received an allocation under section 474A.061, subdivision 2a, in the same calendar 
68.23 	year. The Minnesota Housing Finance Agency shall receive an allocation for mortgage 
68.24 	bonds pursuant to this section, minus any amounts for a city or consortium that intends to 
68.25 	issue bonds on its own behalf under paragraph (c).
68.26 	(b) The agency may issue bonds on behalf of participating cities. The agency shall 
68.27 	request an allocation from the commissioner for all applicants who choose to have the 
68.28 	agency issue bonds on their behalf and the commissioner shall allocate the requested 
68.29 	amount to the agency. Allocations shall be awarded by the commissioner each Monday 
68.30 	commencing on the first Monday in October through the last Monday in November for 
68.31 	applications received by 4:30 p.m. on the Monday of the week preceding an allocation.
68.32 	For cities who choose to have the agency issue bonds on their behalf, allocations 
68.33 	will be made loan by loan, on a first-come, first-served basis among the cities. The 
69.1 	agency shall submit an application fee pursuant to section 474A.03, subdivision 4, and an 
69.2 	application deposit equal to two percent of the requested allocation to the commissioner 
69.3 	when requesting an allocation from the unified pool. After awarding an allocation and 
69.4 	receiving a notice of issuance for mortgage bonds issued on behalf of the participating 
69.5 	cities, the commissioner shall transfer the application deposit to the Minnesota Housing 
69.6 	Finance Agency.
69.7 	For purposes of paragraphs (a) to (d), "city" means a county or a consortium of 
69.8 	local government units that agree through a joint powers agreement to apply together 
69.9 	for single-family housing programs, and has the meaning given it in section 462C.02, 
69.10 	subdivision 6. "Agency" means the Minnesota Housing Finance Agency.
69.11 	(c) Any city that received an allocation pursuant to section 474A.061, subdivision 
69.12 	2a, paragraph (f), in the current year that wishes to receive an additional allocation from 
69.13 	the unified pool and issue bonds on its own behalf or pursuant to a joint powers agreement 
69.14 	shall notify the Minnesota Housing Finance Agency by the third Monday in September. 
69.15 	The total amount of allocation for mortgage bonds for a city choosing to issue bonds on its 
69.16 	own behalf or through a joint powers agreement is limited to the lesser of: (i) the amount 
69.17 	requested, or (ii) the product of the total amount available for mortgage bonds from the 
69.18 	unified pool, multiplied by the ratio of the population of each city that applied in January 
69.19 	and received an allocation under section 474A.061, subdivision 2a, in the same calendar 
69.20 	year, as determined by the most recent estimate of the city's population released by the 
69.21 	state demographer's office to the total of the population of all the cities that applied in 
69.22 	January and received an allocation under section 474A.061, subdivision 2a, in the same 
69.23 	calendar year. If a city choosing to issue bonds on its own behalf or through a joint powers 
69.24 	agreement is located within a county that has also chosen to issue bonds on its own behalf 
69.25 	or through a joint powers agreement, the city's population will be deducted from the 
69.26 	county's population in calculating the amount of allocations under this paragraph.
69.27 	The Minnesota Housing Finance Agency shall notify each city choosing to issue 
69.28 	bonds on its own behalf or pursuant to a joint powers agreement of the amount of its 
69.29 	allocation by October 15. Upon determining the amount of the allocation of each choosing 
69.30 	to issue bonds on its own behalf or through a joint powers agreement, the agency shall 
69.31 	forward a list specifying the amounts allotted to each city.
69.32 	A city that chooses to issue bonds on its own behalf or through a joint powers 
69.33 	agreement may request an allocation from the commissioner by forwarding an application 
69.34 	with an application fee pursuant to section 474A.03, subdivision 4, and an application 
69.35 	deposit equal to two percent of the requested amount to the commissioner no later than 
69.36 	4:30 p.m. on the Monday of the week preceding an allocation. Allocations to cities that 
70.1 	choose to issue bonds on their own behalf shall be awarded by the commissioner on 
70.2 	the first Monday after October 15 through the last Monday in November. No city may 
70.3 	receive an allocation from the commissioner after the last Monday in November. The 
70.4 	commissioner shall allocate the requested amount to the city or cities subject to the 
70.5 	limitations under this subdivision.
70.6 	If a city issues mortgage bonds from an allocation received under this paragraph, 
70.7 	the issuer must provide for the recycling of funds into new loans. If the issuer is not 
70.8 	able to provide for recycling, the issuer must notify the commissioner in writing of the 
70.9 	reason that recycling was not possible and the reason the issuer elected not to have the 
70.10 	Minnesota Housing Finance Agency issue the bonds. "Recycling" means the use of money 
70.11 	generated from the repayment and prepayment of loans for further eligible loans or for the 
70.12 	redemption of bonds and the issuance of current refunding bonds.
70.13 	(d) No entitlement city or county or city in an entitlement county may apply for or 
70.14 	be allocated authority to issue mortgage bonds or use mortgage credit certificates from 
70.15 	the unified pool.
70.16 	(e) An allocation awarded to the agency for mortgage bonds under this section 
70.17 	may be carried forward by the agency into the next succeeding calendar year subject to 
70.18 	notice requirements under section 474A.131and is available until the last business day in 
70.19 	December of that succeeding calendar year.

70.20 	EFFECTIVE DATE. This section is effective the day following final enactment 
70.21 	and applies to any bonding authority allocated in 2011 and subsequent years.

70.22 	Sec. 8. Minnesota Statutes 2010, section 475.521, subdivision 2, is amended to read:
70.23 		Subd. 2.Election requirement. (a) Bonds issued by a municipality to finance 
70.24 	capital improvements under an approved capital improvements plan are not subject to the 
70.25 	election requirements of section 475.58. The bonds must be approved by an affirmative 
70.26 	vote of three-fifths of the members of a five-member governing body. In the case of a 
70.27 	governing body having more or less than five members, the bonds must be approved by a 
70.28 	vote of at least two-thirds of the members of the governing body.
70.29 	(b) Before the issuance of bonds qualifying under this section, the municipality 
70.30 	must publish a notice of its intention to issue the bonds and the date and time of the 
70.31 	hearing to obtain public comment on the matter. The notice must be published in the 
70.32 	official newspaper of the municipality or in a newspaper of general circulation in the 
70.33 	municipality. Additionally, the notice may be posted on the official Web site, if any, of the 
70.34 	municipality. The notice must be published at least 14 but not more than 28 days before 
70.35 	the date of the hearing.
71.1 	(c) A municipality may issue the bonds only after obtaining the approval of a 
71.2 	majority of the voters voting on the question of issuing the obligations, if a petition 
71.3 	requesting a vote on the issuance is signed by voters equal to five percent of the votes cast 
71.4 	in the municipality in the last municipal general election and is filed with the clerk within 
71.5 	30 days after the public hearing. The commissioner of revenue shall prepare a suggested 
71.6 	form of the question to be presented at the election If the municipality elects not to submit 
71.7 	the question to the voters, the municipality shall not propose the issuance of bonds under 
71.8 	this section for the same purpose and in the same amount for a period of 365 days from the 
71.9 	date of receipt of the petition. If the question of issuing the bonds is submitted and not 
71.10 	approved by the voters, the provisions of section 475.58, subdivision 1a, apply.

71.11 	Sec. 9. Minnesota Statutes 2010, section 475.521, subdivision 4, is amended to read:
71.12 		Subd. 4.Limitations on amount. A municipality may not issue bonds under 
71.13 	this section if the maximum amount of principal and interest to become due in any 
71.14 	year on all the outstanding bonds issued under this section, including the bonds to be 
71.15 	issued, will equal or exceed 0.16 percent of the taxable market value of property in the 
71.16 	municipality. Calculation of the limit must be made using the taxable market value for 
71.17 	the taxes payable year in which the obligations are issued and sold, provided that, for 
71.18 	purposes of determining the principal and interest due in any year, the municipality may 
71.19 	deduct the amount of interest expected to be paid or reimbursed to the municipality by the 
71.20 	federal government in that year on any outstanding bonds or the bonds to be issued. In 
71.21 	the case of a municipality with a population of 2,500 or more, the bonds are subject to 
71.22 	the net debt limits under section 475.53. In the case of a shared facility in which more 
71.23 	than one municipality participates, upon compliance by each participating municipality 
71.24 	with the requirements of subdivision 2, the limitations in this subdivision and the net debt 
71.25 	represented by the bonds shall be allocated to each participating municipality in proportion 
71.26 	to its required financial contribution to the financing of the shared facility, as set forth in 
71.27 	the joint powers agreement relating to the shared facility. This section does not limit the 
71.28 	authority to issue bonds under any other special or general law.

71.29 	Sec. 10. Minnesota Statutes 2010, section 475.58, subdivision 3b, is amended to read:
71.30 		Subd. 3b.Street reconstruction. (a) A municipality may, without regard to 
71.31 	the election requirement under subdivision 1, issue and sell obligations for street 
71.32 	reconstruction, if the following conditions are met:
71.33 	(1) the streets are reconstructed under a street reconstruction plan that describes the 
71.34 	street reconstruction to be financed, the estimated costs, and any planned reconstruction 
72.1 	of other streets in the municipality over the next five years, and the plan and issuance of 
72.2 	the obligations has been approved by a vote of all of the members of the governing body 
72.3 	present at the meeting following a public hearing for which notice has been published in 
72.4 	the official newspaper at least ten days but not more than 28 days prior to the hearing; and
72.5 	(2) if a petition requesting a vote on the issuance is signed by voters equal to 
72.6 	five percent of the votes cast in the last municipal general election and is filed with the 
72.7 	municipal clerk within 30 days of the public hearing, the municipality may issue the bonds 
72.8 	only after obtaining the approval of a majority of the voters voting on the question of the 
72.9 	issuance of the obligations. If the municipality elects not to submit the question to the 
72.10 	voters, the municipality shall not propose the issuance of bonds under this section for the 
72.11 	same purpose and in the same amount for a period of 365 days from the date of receipt 
72.12 	of the petition. If the question of issuing the bonds is submitted and not approved by the 
72.13 	voters, the provisions of subdivision 1a, apply.
72.14 	(b) Obligations issued under this subdivision are subject to the debt limit of the 
72.15 	municipality and are not excluded from net debt under section 475.51, subdivision 4.
72.16 	(c) For purposes of this subdivision, street reconstruction includes utility 
72.17 	replacement and relocation and other activities incidental to the street reconstruction, turn 
72.18 	lanes and other improvements having a substantial public safety function, realignments, 
72.19 	other modifications to intersect with state and county roads, and the local share of state 
72.20 	and county road projects.
72.21 	(d) Except in the case of turn lanes, safety improvements, realignments, intersection 
72.22 	modifications, and the local share of state and county road projects, street reconstruction 
72.23 	does not include the portion of project cost allocable to widening a street or adding curbs 
72.24 	and gutters where none previously existed.

72.25 	Sec. 11. Laws 1971, chapter 773, section 1, subdivision 2, as amended by Laws 1974, 
72.26 	chapter 351, section 5, Laws 1976, chapter 234, sections 1 and 7, Laws 1978, chapter 788, 
72.27 	section 1, Laws 1981, chapter 369, section 1, Laws 1983, chapter 302, section 1, Laws 
72.28 	1988, chapter 513, section 1, Laws 1992, chapter 511, article 9, section 23, Laws 1998, 
72.29 	chapter 389, article 3, section 27, and Laws 2002, chapter 390, section 23, is amended to 
72.30 	read:
72.31 	Subd. 2. For each of the years 2003 to 2013 2012 to 2024, the city of St. Paul is 
72.32 	authorized to issue bonds in the aggregate principal amount of $20,000,000 for each year.

72.33 	EFFECTIVE DATE. This section is effective the day following final enactment.

72.34 	Sec. 12. Laws 2003, chapter 127, article 12, section 28, is amended to read:
73.1 	Sec. 28. NURSING HOME BONDS AUTHORIZED.
 73.2 	(a) Itasca County may issue bonds under Minnesota Statutes, sections 376.55 and 
73.3 	376.56, to finance the construction of a 35-bed nursing home facility to replace an existing 
73.4 	35-bed private facility located in the county. The bonds issued under this section must
73.5 	may be payable solely from revenues and or may not be general obligations of the county.
73.6 	(b) Before issuing general obligation bonds under this section, the county must 
73.7 	publish a notice of its intention to issue the bonds and the date and time of a hearing to 
73.8 	obtain public comment on the matter. The notice must be published on the official Web 
73.9 	site of the county or in a newspaper of general circulation in the county. The notice must 
73.10 	be published at least 14 but not more than 28 days before the date of the hearing. The 
73.11 	county may issue the bonds only upon obtaining the approval of a majority of the voters 
73.12 	voting on the question of issuing the obligations, if a petition requesting a vote on the 
73.13 	issuance is signed by voters equal to five percent of the votes cast in the county in the last 
73.14 	general election and is filed with the county auditor within 30 days after the public hearing.

73.15 	EFFECTIVE DATE; LOCAL APPROVAL. This section is effective the day after 
73.16 	the governing body of Itasca County and its chief clerical officer timely complete their 
73.17 	compliance with Minnesota Statutes, section 645.021, subdivisions 2 and 3.

73.18 	Sec. 13. CARRYFORWARD OF BONDING AUTHORITY FOR 2008, 2009, 
73.19 	AND 2010; NO DEDUCTION FROM ENTITLEMENT ALLOCATION.
 73.20 	Notwithstanding Minnesota Statutes, section 474A.04, subdivision 1a, and Laws 
73.21 	2009, chapter 88, article 6, section 27, bonding authority that was allocated to an 
73.22 	entitlement issuer in 2008, 2009, and 2010 and that was carried forward under federal 
73.23 	tax law, but for which the entitlement issuer did not provide a notice of issue to the 
73.24 	commissioner of management and budget before 4:30 p.m. on the last business day of 
73.25 	December 2011 must not be deducted from the entitlement allocation for that entitlement 
73.26 	issuer in 2012.

73.27 	EFFECTIVE DATE. This section is effective the day following final enactment 
73.28 	and applies retroactively to rescind any reallocation by the commissioner of management 
73.29 	and budget under Minnesota Statutes, section 474A.04, subdivision 1a, of any amounts so 
73.30 	deducted.

73.31 	Sec. 14. WOODBURY; EXEMPTION FROM REFERENDUM.
 73.32 	(a) Notwithstanding the referendum requirement in Minnesota Statutes, section 
73.33 	475.58, subdivision 1, or any other provision of law, the city of Woodbury may issue and 
74.1 	sell obligations to pay for the cost of renovating, improving, expanding, and equipping the 
74.2 	Bielenberg Sports Center, along with costs of issuance of the obligations and capitalized 
74.3 	interest, if:
74.4 	(1) the obligations are secured by a pledge of revenues from the facility; and
74.5 	(2) the city finds, based on analysis provided by a professional experienced in 
74.6 	finance, that the facility's revenues and a property tax levy equal to the maximum annual 
74.7 	property tax levy used to pay the bonds previously issued to finance, in whole or in part, 
74.8 	the facility will in the aggregate be sufficient to pay the obligations without the imposition 
74.9 	of an additional property tax levy pledged to the obligations.
74.10 	(b) Before issuing bonds under this section, the city must publish a notice of its 
74.11 	intention to issue the bonds and the date and time of a hearing to obtain public comment 
74.12 	on the matter. The notice must be published on the official Web site of the city or in a 
74.13 	newspaper of general circulation in the city. The notice must be published at least 14 but 
74.14 	not more than 28 days before the date of the hearing. The city may issue the bonds only 
74.15 	upon obtaining the approval of a majority of the voters voting on the question of issuing 
74.16 	the obligations, if a petition requesting a vote on the issuance is signed by voters equal to 
74.17 	five percent of the votes cast in the city in the last general election and is filed with the city 
74.18 	clerk within 30 days after the public hearing.

74.19 	EFFECTIVE DATE; LOCAL APPROVAL. This section  is effective the day after 
74.20 	the governing body of the city of Woodbury and its chief clerical officer timely complete 
74.21 	their compliance with Minnesota Statutes, section 645.021, subdivisions 2 and 3.

74.22 	ARTICLE 7
74.23 	PROPERTY TAXES

74.24 	Section 1. Minnesota Statutes 2010, section 6.91, subdivision 2, is amended to read:
74.25 		Subd. 2.Benefits of participation. (a) A county or city that elects to participate in 
74.26 	the standard measures program for 2011 is: (1) eligible for per capita reimbursement of 
74.27 	$0.14 per capita, but not to exceed $25,000 for any government entity; and (2) exempt 
74.28 	from levy limits under sections 275.70 to 275.74 for taxes payable in 2012, if levy limits 
74.29 	are in effect.
74.30 	(b) Any county or city that elects to participate in the standard measures program 
74.31 	for 2012 is eligible for per capita reimbursement of $0.14 per capita, but not to exceed 
74.32 	$25,000 for any government entity, provided that for 2012, a county or city with a 
74.33 	population over 5,000 must also participate in the expenditure-type reporting under section 
74.34 	471.703 in order to be eligible. Any jurisdiction participating in the comprehensive 
75.1 	performance measurement program is exempt from levy limits under sections 275.70 to 
75.2 	275.74 for taxes payable in 2013 if levy limits are in effect.
75.3 	(c) Any county or city that elects to participate in the standard measures program for 
75.4 	2013 or any year thereafter is eligible for per capita reimbursement of $0.14 per capita, 
75.5 	but not to exceed $25,000 for any government entity. Any jurisdiction participating in 
75.6 	the comprehensive performance measurement program for 2013 or any year thereafter is 
75.7 	exempt from levy limits under sections 275.70 to 275.74 for taxes payable in the following 
75.8 	year, if levy limits are in effect.

75.9 	EFFECTIVE DATE. This section is effective the day following final enactment.

75.10 	Sec. 2. Minnesota Statutes 2011 Supplement, section 270C.991, subdivision 4, as 
75.11 	amended by Laws 2012, chapter 187, article 1, section 45, is amended to read:
75.12 		Subd. 4.Property tax working group. (a) A property tax working group is 
75.13 	established as provided in this subdivision. The goals of the working group are:
75.14 	(1) to investigate ways to simplify the property tax system and make advisory 
75.15 	recommendations on ways to make the system more understandable;
75.16 	(2) to reexamine the property tax calendar to determine what changes could be made 
75.17 	to shorten the two-year cycle from assessment through property tax collection; and
75.18 	(3) to determine the cost versus the benefits of the various property tax components, 
75.19 	including property classifications, credits, aids, exclusions, exemptions, and abatements, 
75.20 	and to suggest ways to achieve some of the goals in simpler and more cost-efficient ways.
75.21 	(b) The 12-member working group shall consist of the following members:
75.22 	(1) two state representatives, both appointed by the chair of the house of 
75.23 	representatives Taxes Committee, one from the majority party and one from the largest 
75.24 	minority party;
75.25 	(2) two senators appointed by the Subcommittee on Committees of the Senate Rules 
75.26 	and Administration Committee, one from the majority party and one from the largest 
75.27 	minority party;
75.28 	(3) one person appointed by the Association of Minnesota Counties;
75.29 	(4) one person appointed by the League of Minnesota Cities;
75.30 	(5) one person appointed by the Minnesota Association of Townships;
75.31 	(6) one person appointed by the Minnesota Chamber of Commerce;
75.32 	(7) one person appointed by the Minnesota Association of Assessing Officers;
75.33 	(8) two homeowners, one who is under 65 years of age, and one who is 65 years of 
75.34 	age or older, both appointed by the commissioner of revenue; and
76.1 	(9) one person jointly appointed by the Minnesota Farm Bureau and the Minnesota 
76.2 	Farmers Union.
76.3 	The commissioner of revenue shall chair the initial meeting, and the working 
76.4 	group shall elect a chair at that initial meeting. The working group will meet at the call 
76.5 	of the chair. Members of the working group shall serve without compensation. The 
76.6 	commissioner of revenue must provide administrative support to the working group. 
76.7 	Chapter 13D does not apply to meetings of the working group. Meetings of the working 
76.8 	group must be open to the public and the working group must provide notice of a meeting 
76.9 	to potentially interested persons at least seven days before the meeting. A meeting of the 
76.10 	working group occurs when a quorum is present.
76.11 	(c) The working group shall make its advisory recommendations to the chairs of the 
76.12 	house of representatives and senate Taxes Committees on or before February 1, 2013, at 
76.13 	which time the working group shall be finished and this subdivision expires. The advisory 
76.14 	recommendations should be reviewed by the Taxes Committees under subdivision 5.

76.15 	Sec. 3. Minnesota Statutes 2010, section 273.113, is amended to read:
76.16 	273.113 TAX CREDIT FOR PROPERTY IN PROPOSED BOVINE 
76.17 	TUBERCULOSIS MODIFIED ACCREDITED MANAGEMENT ZONE.
76.18 		Subdivision 1.Definitions. For the purposes of this section, the following terms 
76.19 	have the meanings given to them:
76.20 	(1) "bovine tuberculosis modified accredited management zone" means the modified 
76.21 	accredited management zone designated by the Board of Animal Health under section 
76.22 	35.244;
76.23 	(2) "located within" means that the herd is kept in the area for at least a part of 
76.24 	calendar year 2006, 2007, or 2008; and
76.25 	(3) "animal" means cattle, bison, goats, and farmed cervidae.
76.26 		Subd. 2.Eligibility; amount of credit. Agricultural and rural vacant land classified 
76.27 	under section 273.13, subdivision 23, located within a bovine tuberculosis modified 
76.28 	accredited management zone is eligible for a property tax credit equal to the greater of: (1) 
76.29 	$5 per acre on the first 160 acres of the property where the herd had been located; or (2) an 
76.30 	amount equal to $5 per acre times five acres times the highest number of animals tested 
76.31 	on the property for bovine tuberculosis in a whole-herd test as reported by the Board of 
76.32 	Animal Health in 2006, 2007, or 2008 the amount of credit received under this section for 
76.33 	taxes payable in 2011. The amount of the credit cannot exceed the property tax payable on 
76.34 	the property where the herd had been located, excluding any tax attributable to residential 
76.35 	structures. To begin to qualify for the tax credit for taxes payable in 2012, the owner shall 
77.1 	file an application with the county by December 1 of the levy year July 1, 2012. For 
77.2 	taxes payable in 2012, the credit shall be paid as a direct payment to the property owner, 
77.3 	issued by the county within 30 days of receipt of the application, provided that there are 
77.4 	no delinquent taxes on the property. The credit must be given for each subsequent taxes 
77.5 	payable year until the credit terminates under subdivision 4. For taxes payable in 2013 
77.6 	and thereafter, the assessor shall indicate the amount of the property tax reduction on the 
77.7 	property tax statement of each taxpayer receiving a credit under this section. For taxes 
77.8 	payable in 2013 and thereafter, the credit paid pursuant to this section shall be deducted 
77.9 	from the tax due on the property as provided in section 273.1393.
77.10 		Subd. 3.Reimbursement for lost revenue. The county auditor shall certify to the 
77.11 	commissioner of revenue, as part of the abstracts of tax lists required to be filed with the 
77.12 	commissioner under section 275.29, the amount of tax lost to the county from the property 
77.13 	tax credit under subdivision 2, except that for taxes payable in 2012 only, the county shall 
77.14 	submit the credit amounts to the commissioner of revenue in a separate report, in a form 
77.15 	prescribed by the commissioner, prior to August 15, 2012. Any prior year adjustments 
77.16 	must also be certified in the abstracts of tax lists. The commissioner of revenue shall 
77.17 	review the certifications to determine their accuracy. The commissioner may make the 
77.18 	changes in the certification that are considered necessary or return a certification to the 
77.19 	county auditor for corrections. The commissioner shall reimburse each taxing district, 
77.20 	other than school districts, for the taxes lost. The payments must be made at the time 
77.21 	provided in section 473H.10 for payment to taxing jurisdictions in the same proportion 
77.22 	that the ad valorem tax is distributed, except that for taxes payable in 2012 the entire 
77.23 	reimbursement must be made to the county. Reimbursements to school districts must be 
77.24 	made as provided in section 273.1392. The amount necessary to make the reimbursements 
77.25 	under this section is annually appropriated from the general fund to the commissioner of 
77.26 	revenue.
77.27 		Subd. 4.Termination of credit. The credits provided under this section cease to 
77.28 	be available beginning with taxes payable in the year following the date when the Board 
77.29 	of Animal Health notifies the commissioner of revenue in writing that the board has 
77.30 	certified that the state is free ofdiscontinued all required bovine tuberculosis related 
77.31 	activities within the bovine tuberculosis management zone.

77.32 	EFFECTIVE DATE. This section is effective for taxes payable in 2012 and 
77.33 	thereafter.

77.34 	Sec. 4. Minnesota Statutes 2010, section 275.025, subdivision 1, is amended to read:
78.1 		Subdivision 1.Levy amount. The state general levy is levied against 
78.2 	commercial-industrial property and seasonal residential recreational property, as defined in 
78.3 	this section. The state general levy base amount is $592,000,000 $817,423,000 for taxes 
78.4 	payable in 2002 2013. For taxes payable in subsequent years, the levy base amount is 
78.5 	increased each year by multiplying the levy base amount for the prior year by the sum 
78.6 	of one plus the rate of increase, if any, in the implicit price deflator for government 
78.7 	consumption expenditures and gross investment for state and local governments prepared 
78.8 	by the Bureau of Economic Analysts of the United States Department of Commerce for 
78.9 	the 12-month period ending March 31 of the year prior to the year the taxes are payable. 
78.10 	The tax under this section is not treated as a local tax rate under section 469.177 and is not 
78.11 	the levy of a governmental unit under chapters 276A and 473F.
78.12 	The commissioner shall increase or decrease the preliminary or final rate rates for a 
78.13 	year as necessary to account for errors and tax base changes that affected a preliminary or 
78.14 	final rate for either of the two preceding years. Adjustments are allowed to the extent that 
78.15 	the necessary information is available to the commissioner at the time the rates for a year 
78.16 	must be certified, and for the following reasons:
78.17 	(1) an erroneous report of taxable value by a local official;
78.18 	(2) an erroneous calculation by the commissioner; and
78.19 	(3) an increase or decrease in taxable value for commercial-industrial or seasonal 
78.20 	residential recreational property reported on the abstracts of tax lists submitted under 
78.21 	section 275.29 that was not reported on the abstracts of assessment submitted under 
78.22 	section 270C.89 for the same year.
78.23 	The commissioner may, but need not, make adjustments if the total difference in the tax 
78.24 	levied for the year would be less than $100,000.

78.25 	EFFECTIVE DATE. This section is effective for taxes payable in 2013 and 
78.26 	thereafter.

78.27 	Sec. 5. Minnesota Statutes 2010, section 275.065, subdivision 1, is amended to read:
78.28 		Subdivision 1.Proposed levy. (a) Notwithstanding any law or charter to the 
78.29 	contrary, on or before September 15, each taxing authority, other than a school district, 
78.30 	shall adopt a proposed budget and shall certify to the county auditor the proposed or, in 
78.31 	the case of a town, the final property tax levy for taxes payable in the following year. All 
78.32 	counties with a population of more than 5,000 and home rule charter or statutory cities 
78.33 	with a population of more than 5,000, shall also provide to the county auditor the county 
79.1 	or city Web site, if there is one, where the public is able to access the budget information 
79.2 	required to be reported under section 471.703.
79.3 	(b) On or before September 30, each school district that has not mutually agreed 
79.4 	with its home county to extend this date shall certify to the county auditor the proposed 
79.5 	property tax levy for taxes payable in the following year. Each school district that has 
79.6 	agreed with its home county to delay the certification of its proposed property tax levy 
79.7 	must certify its proposed property tax levy for the following year no later than October 
79.8 	7. The school district shall certify the proposed levy as:
79.9 	(1) a specific dollar amount by school district fund, broken down between 
79.10 	voter-approved and non-voter-approved levies and between referendum market value 
79.11 	and tax capacity levies; or
79.12 	(2) the maximum levy limitation certified by the commissioner of education 
79.13 	according to section 126C.48, subdivision 1.
79.14 	(c) If the board of estimate and taxation or any similar board that establishes 
79.15 	maximum tax levies for taxing jurisdictions within a first class city certifies the maximum 
79.16 	property tax levies for funds under its jurisdiction by charter to the county auditor by 
79.17 	September 15, the city shall be deemed to have certified its levies for those taxing 
79.18 	jurisdictions.
79.19 	(d) For purposes of this section, "taxing authority" includes all home rule and 
79.20 	statutory cities, towns, counties, school districts, and special taxing districts as defined 
79.21 	in section 275.066. Intermediate school districts that levy a tax under chapter 124 or 
79.22 	136D, joint powers boards established under sections 123A.44 to 123A.446, and Common 
79.23 	School Districts No. 323, Franconia, and No. 815, Prinsburg, are also special taxing 
79.24 	districts for purposes of this section.
79.25 	(e) At the meeting at which the taxing authority, other than a town, adopts its 
79.26 	proposed tax levy under paragraph (a) or (b), the taxing authority shall announce the 
79.27 	time and place of its subsequent regularly scheduled meetings at which the budget and 
79.28 	levy will be discussed and at which the public will be allowed to speak. The time and 
79.29 	place of those meetingsThe following information must be included in the proceedings 
79.30 	or summary of proceedings published in the official newspaper of the taxing authority 
79.31 	under section 123B.09, 375.12, or 412.191:
79.32 	(1) the time and place of the meetings described in this paragraph; and
79.33 	(2) a statement that the budget information required to be reported under section 
79.34 	471.703 is available on the county or city Web site, if there is one.

79.35 	EFFECTIVE DATE. This section is effective July 1, 2012.

80.1 	Sec. 6. Minnesota Statutes 2010, section 275.065, subdivision 3, is amended to read:
80.2 		Subd. 3.Notice of proposed property taxes. (a) The county auditor shall prepare 
80.3 	and the county treasurer shall deliver after November 10 and on or before November 24 
80.4 	each year, by first class mail to each taxpayer at the address listed on the county's current 
80.5 	year's assessment roll, a notice of proposed property taxes. Upon written request by 
80.6 	the taxpayer, the treasurer may send the notice in electronic form or by electronic mail 
80.7 	instead of on paper or by ordinary mail.
80.8 	(b) The commissioner of revenue shall prescribe the form of the notice.
80.9 	(c) The notice must inform taxpayers that it contains the amount of property taxes 
80.10 	each taxing authority proposes to collect for taxes payable the following year. In the 
80.11 	case of a town, or in the case of the state general tax, the final tax amount will be its 
80.12 	proposed tax. The notice must clearly state for each city that has a population over 500, 
80.13 	county, school district, regional library authority established under section 134.201, and 
80.14 	metropolitan taxing districts as defined in paragraph (i), the time and place of a meeting 
80.15 	for each taxing authority in which the budget and levy will be discussed and public input 
80.16 	allowed, prior to the final budget and levy determination. The notice must clearly state 
80.17 	for each county with a population of more than 5,000 and for each city with a population 
80.18 	of more than 5,000 that the budget information required to be reported under section 
80.19 	471.703 is available on the county or city Web site, if there is one. The taxing authorities 
80.20 	must provide the county auditor with the information to be included in the notice on or 
80.21 	before the time it certifies its proposed levy under subdivision 1. The public must be 
80.22 	allowed to speak at that meeting, which must occur after November 24 and must not be 
80.23 	held before 6:00 p.m. It must provide a telephone number for the taxing authority that 
80.24 	taxpayers may call if they have questions related to the notice and an address where 
80.25 	comments will be received by mail, except that no notice required under this section 
80.26 	shall be interpreted as requiring the printing of a personal telephone number or address 
80.27 	as the contact information for a taxing authority. If a taxing authority does not maintain 
80.28 	public offices where telephone calls can be received by the authority, the authority may 
80.29 	inform the county of the lack of a public telephone number and the county shall not list a 
80.30 	telephone number for that taxing authority.
80.31 	(d) The notice must state for each parcel:
80.32 	(1) the market value of the property as determined under section 273.11, and used 
80.33 	for computing property taxes payable in the following year and for taxes payable in the 
80.34 	current year as each appears in the records of the county assessor on November 1 of the 
80.35 	current year; and, in the case of residential property, whether the property is classified as 
81.1 	homestead or nonhomestead. The notice must clearly inform taxpayers of the years to 
81.2 	which the market values apply and that the values are final values;
81.3 	(2) the items listed below, shown separately by county, city or town, and state general 
81.4 	tax, net of the residential and agricultural homestead credit under section 273.1384, voter 
81.5 	approved school levy, other local school levy, and the sum of the special taxing districts, 
81.6 	and as a total of all taxing authorities:
81.7 	(i) the actual tax for taxes payable in the current year; and
81.8 	(ii) the proposed tax amount.
81.9 	If the county levy under clause (2) includes an amount for a lake improvement 
81.10 	district as defined under sections 103B.501 to 103B.581, the amount attributable for that 
81.11 	purpose must be separately stated from the remaining county levy amount.
81.12 	In the case of a town or the state general tax, the final tax shall also be its proposed 
81.13 	tax unless the town changes its levy at a special town meeting under section 365.52. If a 
81.14 	school district has certified under section 126C.17, subdivision 9, that a referendum will 
81.15 	be held in the school district at the November general election, the county auditor must 
81.16 	note next to the school district's proposed amount that a referendum is pending and that, if 
81.17 	approved by the voters, the tax amount may be higher than shown on the notice. In the 
81.18 	case of the city of Minneapolis, the levy for Minneapolis Park and Recreation shall be 
81.19 	listed separately from the remaining amount of the city's levy. In the case of the city of 
81.20 	St. Paul, the levy for the St. Paul Library Agency must be listed separately from the 
81.21 	remaining amount of the city's levy. In the case of Ramsey County, any amount levied 
81.22 	under section 134.07 may be listed separately from the remaining amount of the county's 
81.23 	levy. In the case of a parcel where tax increment or the fiscal disparities areawide tax 
81.24 	under chapter 276A or 473F applies, the proposed tax levy on the captured value or the 
81.25 	proposed tax levy on the tax capacity subject to the areawide tax must each be stated 
81.26 	separately and not included in the sum of the special taxing districts; and
81.27 	(3) the increase or decrease between the total taxes payable in the current year and 
81.28 	the total proposed taxes, expressed as a percentage.
81.29 	For purposes of this section, the amount of the tax on homesteads qualifying under 
81.30 	the senior citizens' property tax deferral program under chapter 290B is the total amount 
81.31 	of property tax before subtraction of the deferred property tax amount.
81.32 	(e) The notice must clearly state that the proposed or final taxes do not include 
81.33 	the following:
81.34 	(1) special assessments;
81.35 	(2) levies approved by the voters after the date the proposed taxes are certified, 
81.36 	including bond referenda and school district levy referenda;
82.1 	(3) a levy limit increase approved by the voters by the first Tuesday after the first 
82.2 	Monday in November of the levy year as provided under section 275.73;
82.3 	(4) amounts necessary to pay cleanup or other costs due to a natural disaster 
82.4 	occurring after the date the proposed taxes are certified;
82.5 	(5) amounts necessary to pay tort judgments against the taxing authority that become 
82.6 	final after the date the proposed taxes are certified; and
82.7 	(6) the contamination tax imposed on properties which received market value 
82.8 	reductions for contamination.
82.9 	(f) Except as provided in subdivision 7, failure of the county auditor to prepare or 
82.10 	the county treasurer to deliver the notice as required in this section does not invalidate the 
82.11 	proposed or final tax levy or the taxes payable pursuant to the tax levy.
82.12 	(g) If the notice the taxpayer receives under this section lists the property as 
82.13 	nonhomestead, and satisfactory documentation is provided to the county assessor by the 
82.14 	applicable deadline, and the property qualifies for the homestead classification in that 
82.15 	assessment year, the assessor shall reclassify the property to homestead for taxes payable 
82.16 	in the following year.
82.17 	(h) In the case of class 4 residential property used as a residence for lease or rental 
82.18 	periods of 30 days or more, the taxpayer must either:
82.19 	(1) mail or deliver a copy of the notice of proposed property taxes to each tenant, 
82.20 	renter, or lessee; or
82.21 	(2) post a copy of the notice in a conspicuous place on the premises of the property.
82.22 	The notice must be mailed or posted by the taxpayer by November 27 or within 
82.23 	three days of receipt of the notice, whichever is later. A taxpayer may notify the county 
82.24 	treasurer of the address of the taxpayer, agent, caretaker, or manager of the premises to 
82.25 	which the notice must be mailed in order to fulfill the requirements of this paragraph.
82.26 	(i) For purposes of this subdivision and subdivision 6, "metropolitan special taxing 
82.27 	districts" means the following taxing districts in the seven-county metropolitan area that 
82.28 	levy a property tax for any of the specified purposes listed below:
82.29 	(1) Metropolitan Council under section 473.132, 473.167, 473.249, 473.325, 
82.30 	473.446, 473.521, 473.547, or 473.834;
82.31 	(2) Metropolitan Airports Commission under section 473.667, 473.671, or 473.672; 
82.32 	and
82.33 	(3) Metropolitan Mosquito Control Commission under section 473.711.
82.34 	For purposes of this section, any levies made by the regional rail authorities in the 
82.35 	county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 
82.36 	398A shall be included with the appropriate county's levy.
83.1 	(j) The governing body of a county, city, or school district may, with the consent 
83.2 	of the county board, include supplemental information with the statement of proposed 
83.3 	property taxes about the impact of state aid increases or decreases on property tax 
83.4 	increases or decreases and on the level of services provided in the affected jurisdiction. 
83.5 	This supplemental information may include information for the following year, the current 
83.6 	year, and for as many consecutive preceding years as deemed appropriate by the governing 
83.7 	body of the county, city, or school district. It may include only information regarding:
83.8 	(1) the impact of inflation as measured by the implicit price deflator for state and 
83.9 	local government purchases;
83.10 	(2) population growth and decline;
83.11 	(3) state or federal government action; and
83.12 	(4) other financial factors that affect the level of property taxation and local services 
83.13 	that the governing body of the county, city, or school district may deem appropriate to 
83.14 	include.
83.15 	The information may be presented using tables, written narrative, and graphic 
83.16 	representations and may contain instruction toward further sources of information or 
83.17 	opportunity for comment.

83.18 	EFFECTIVE DATE. This section is effective July 1, 2012.

83.19 	Sec. 7. Minnesota Statutes 2010, section 275.065, subdivision 3, is amended to read:
83.20 		Subd. 3.Notice of proposed property taxes. (a) The county auditor shall prepare 
83.21 	and the county treasurer shall deliver after November 10 and on or before November 24 
83.22 	each year, by first class mail to each taxpayer at the address listed on the county's current 
83.23 	year's assessment roll, a notice of proposed property taxes. Upon written request by 
83.24 	the taxpayer, the treasurer may send the notice in electronic form or by electronic mail 
83.25 	instead of on paper or by ordinary mail.
83.26 	(b) The commissioner of revenue shall prescribe the form of the notice.
83.27 	(c) The notice must inform taxpayers that it contains the amount of property taxes 
83.28 	each taxing authority proposes to collect for taxes payable the following year. In the 
83.29 	case of a town, or in the case of the state general tax, the final tax amount will be its 
83.30 	proposed tax. The notice must clearly state For each city that has a population over 500, 
83.31 	county, school district, regional library authority established under section 134.201, and 
83.32 	metropolitan taxing districts as defined in paragraph (i), the notice must state the time and 
83.33 	place of a meeting for each taxing authority in which the budget and levy will be discussed 
83.34 	and public input allowed, prior to the final budget and levy determination. For each special 
83.35 	taxing district, the notice must: (1) list separately any levy by a special taxing district that 
84.1 	exceeds 25 percent of the total of all special taxing district levies; and (2) provide county 
84.2 	government contact information where additional information may be obtained for each 
84.3 	special taxing district. The taxing authorities must provide the county auditor with the 
84.4 	information to be included in the notice on or before the time it certifies its proposed 
84.5 	levy under subdivision 1. The public must be allowed to speak at that meeting, which 
84.6 	must occur after November 24 and must not be held before 6:00 p.m. It must provide a 
84.7 	telephone number for the taxing authority that taxpayers may call if they have questions 
84.8 	related to the notice and an address where comments will be received by mail, except that 
84.9 	no notice required under this section shall be interpreted as requiring the printing of a 
84.10 	personal telephone number or address as the contact information for a taxing authority. If 
84.11 	a taxing authority does not maintain public offices where telephone calls can be received 
84.12 	by the authority, the authority may inform the county of the lack of a public telephone 
84.13 	number and the county shall not list a telephone number for that taxing authority.
84.14 	(d) The notice must state for each parcel:
84.15 	(1) the market value of the property as determined under section 273.11, and used 
84.16 	for computing property taxes payable in the following year and for taxes payable in the 
84.17 	current year as each appears in the records of the county assessor on November 1 of the 
84.18 	current year; and, in the case of residential property, whether the property is classified as 
84.19 	homestead or nonhomestead. The notice must clearly inform taxpayers of the years to 
84.20 	which the market values apply and that the values are final values;
84.21 	(2) the items listed below, shown separately by county, city or town, and state 
84.22 	general tax, net of the residential and agricultural homestead credit under section 
84.23 	273.1384, voter approved school levy, other local school levy, and the sum of the each
84.24 	special taxing districts district, provided that the levies of all special taxing districts whose 
84.25 	levies do not exceed 25 percent of the total amount of all special taxing district levies may 
84.26 	be aggregated, and as a total of for all taxing authorities:
84.27 	(i) the actual tax for taxes payable in the current year; and
84.28 	(ii) the proposed tax amount.
84.29 	If the county levy under clause (2) includes an amount for a lake improvement 
84.30 	district as defined under sections 103B.501 to 103B.581, the amount attributable for that 
84.31 	purpose must be separately stated from the remaining county levy amount.
84.32 	In the case of a town or the state general tax, the final tax shall also be its proposed 
84.33 	tax unless the town changes its levy at a special town meeting under section 365.52. If a 
84.34 	school district has certified under section 126C.17, subdivision 9, that a referendum will 
84.35 	be held in the school district at the November general election, the county auditor must 
84.36 	note next to the school district's proposed amount that a referendum is pending and that, if 
85.1 	approved by the voters, the tax amount may be higher than shown on the notice. In the 
85.2 	case of the city of Minneapolis, the levy for Minneapolis Park and Recreation shall be 
85.3 	listed separately from the remaining amount of the city's levy. In the case of the city of 
85.4 	St. Paul, the levy for the St. Paul Library Agency must be listed separately from the 
85.5 	remaining amount of the city's levy. In the case of Ramsey County, any amount levied 
85.6 	under section 134.07 may be listed separately from the remaining amount of the county's 
85.7 	levy. In the case of a parcel where tax increment or the fiscal disparities areawide tax 
85.8 	under chapter 276A or 473F applies, the proposed tax levy on the captured value or the 
85.9 	proposed tax levy on the tax capacity subject to the areawide tax must each be stated 
85.10 	separately and not included in the sum of the special taxing districts; and
85.11 	(3) the increase or decrease between the total taxes payable in the current year and 
85.12 	the total proposed taxes, expressed as a percentage.
85.13 	For purposes of this section, the amount of the tax on homesteads qualifying under 
85.14 	the senior citizens' property tax deferral program under chapter 290B is the total amount 
85.15 	of property tax before subtraction of the deferred property tax amount.
85.16 	(e) The notice must clearly state that the proposed or final taxes do not include 
85.17 	the following:
85.18 	(1) special assessments;
85.19 	(2) levies approved by the voters after the date the proposed taxes are certified, 
85.20 	including bond referenda and school district levy referenda;
85.21 	(3) a levy limit increase approved by the voters by the first Tuesday after the first 
85.22 	Monday in November of the levy year as provided under section 275.73;
85.23 	(4) amounts necessary to pay cleanup or other costs due to a natural disaster 
85.24 	occurring after the date the proposed taxes are certified;
85.25 	(5) amounts necessary to pay tort judgments against the taxing authority that become 
85.26 	final after the date the proposed taxes are certified; and
85.27 	(6) the contamination tax imposed on properties which received market value 
85.28 	reductions for contamination.
85.29 	(f) Except as provided in subdivision 7, failure of the county auditor to prepare or 
85.30 	the county treasurer to deliver the notice as required in this section does not invalidate the 
85.31 	proposed or final tax levy or the taxes payable pursuant to the tax levy.
85.32 	(g) If the notice the taxpayer receives under this section lists the property as 
85.33 	nonhomestead, and satisfactory documentation is provided to the county assessor by the 
85.34 	applicable deadline, and the property qualifies for the homestead classification in that 
85.35 	assessment year, the assessor shall reclassify the property to homestead for taxes payable 
85.36 	in the following year.
86.1 	(h) In the case of class 4 residential property used as a residence for lease or rental 
86.2 	periods of 30 days or more, the taxpayer must either:
86.3 	(1) mail or deliver a copy of the notice of proposed property taxes to each tenant, 
86.4 	renter, or lessee; or
86.5 	(2) post a copy of the notice in a conspicuous place on the premises of the property.
86.6 	The notice must be mailed or posted by the taxpayer by November 27 or within 
86.7 	three days of receipt of the notice, whichever is later. A taxpayer may notify the county 
86.8 	treasurer of the address of the taxpayer, agent, caretaker, or manager of the premises to 
86.9 	which the notice must be mailed in order to fulfill the requirements of this paragraph.
86.10 	(i) For purposes of this subdivision and subdivision 6, "metropolitan special taxing 
86.11 	districts" means the following taxing districts in the seven-county metropolitan area that 
86.12 	levy a property tax for any of the specified purposes listed below:
86.13 	(1) Metropolitan Council under section 473.132, 473.167, 473.249, 473.325, 
86.14 	473.446, 473.521, 473.547, or 473.834;
86.15 	(2) Metropolitan Airports Commission under section 473.667, 473.671, or 473.672; 
86.16 	and
86.17 	(3) Metropolitan Mosquito Control Commission under section 473.711.
86.18 	For purposes of this section, any levies made by the regional rail authorities in the 
86.19 	county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 
86.20 	398A shall be included with the appropriate county's levy.
86.21 	(j) The governing body of a county, city, or school district may, with the consent 
86.22 	of the county board, include supplemental information with the statement of proposed 
86.23 	property taxes about the impact of state aid increases or decreases on property tax 
86.24 	increases or decreases and on the level of services provided in the affected jurisdiction. 
86.25 	This supplemental information may include information for the following year, the current 
86.26 	year, and for as many consecutive preceding years as deemed appropriate by the governing 
86.27 	body of the county, city, or school district. It may include only information regarding:
86.28 	(1) the impact of inflation as measured by the implicit price deflator for state and 
86.29 	local government purchases;
86.30 	(2) population growth and decline;
86.31 	(3) state or federal government action; and
86.32 	(4) other financial factors that affect the level of property taxation and local services 
86.33 	that the governing body of the county, city, or school district may deem appropriate to 
86.34 	include.
87.1 	The information may be presented using tables, written narrative, and graphic 
87.2 	representations and may contain instruction toward further sources of information or 
87.3 	opportunity for comment.

87.4 	EFFECTIVE DATE. This section is effective for tax statements relating to taxes 
87.5 	payable in 2014 and thereafter.

87.6 	Sec. 8. Minnesota Statutes 2011 Supplement, section 276.04, subdivision 2, is 
87.7 	amended to read:
87.8 		Subd. 2.Contents of tax statements. (a) The treasurer shall provide for the 
87.9 	printing of the tax statements. The commissioner of revenue shall prescribe the form of 
87.10 	the property tax statement and its contents. The tax statement must not state or imply 
87.11 	that property tax credits are paid by the state of Minnesota. The statement must contain 
87.12 	a tabulated statement of the dollar amount due to each taxing authority and the amount 
87.13 	of the state tax from the parcel of real property for which a particular tax statement is 
87.14 	prepared. The dollar amounts attributable to the county, the state tax, the voter approved 
87.15 	school tax, the other local school tax, the township or municipality, and the total of 
87.16 	the metropolitan special taxing districts as defined in section 275.065, subdivision 3, 
87.17 	paragraph (i), must be separately stated. The amounts due all other special taxing districts, 
87.18 	if any, may be aggregated except that (1) any levies made by the regional rail authorities 
87.19 	in the county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under 
87.20 	chapter 398A shall be listed on a separate line directly under the appropriate county's 
87.21 	levy, and (2) any levy by a special taxing district that exceeds 25 percent of the total of all 
87.22 	special taxing district levies on a tax statement must be separately stated. If the county 
87.23 	levy under this paragraph includes an amount for a lake improvement district as defined 
87.24 	under sections 103B.501 to 103B.581, the amount attributable for that purpose must be 
87.25 	separately stated from the remaining county levy amount. In the case of Ramsey County, 
87.26 	if the county levy under this paragraph includes an amount for public library service 
87.27 	under section 134.07, the amount attributable for that purpose may be separated from the 
87.28 	remaining county levy amount. The amount of the tax on homesteads qualifying under the 
87.29 	senior citizens' property tax deferral program under chapter 290B is the total amount of 
87.30 	property tax before subtraction of the deferred property tax amount. The amount of the 
87.31 	tax on contamination value imposed under sections 270.91 to 270.98, if any, must also 
87.32 	be separately stated. The dollar amounts, including the dollar amount of any special 
87.33 	assessments, may be rounded to the nearest even whole dollar. For purposes of this section 
87.34 	whole odd-numbered dollars may be adjusted to the next higher even-numbered dollar. 
88.1 	The amount of market value excluded under section 273.11, subdivision 16, if any, must 
88.2 	also be listed on the tax statement.
88.3 	(b) The property tax statements for manufactured homes and sectional structures 
88.4 	taxed as personal property shall contain the same information that is required on the 
88.5 	tax statements for real property.
88.6 	(c) Real and personal property tax statements must contain the following information 
88.7 	in the order given in this paragraph. The information must contain the current year tax 
88.8 	information in the right column with the corresponding information for the previous year 
88.9 	in a column on the left:
88.10 	(1) the property's estimated market value under section 273.11, subdivision 1;
88.11 	(2) the property's homestead market value exclusion under section 273.13, 
88.12 	subdivision 35;
88.13 	(3) the property's taxable market value after reductions under sections 273.11, 
88.14 	subdivisions 1a and 16, and 273.13, subdivision 35;
88.15 	(4) the property's gross tax, before credits;
88.16 	(5) for homestead agricultural properties, the credit under section 273.1384;
88.17 	(6) any credits received under sections 273.119; 273.1234 or 273.1235; 273.135; 
88.18 	273.1391; 273.1398, subdivision 4; 469.171; and 473H.10, except that the amount of 
88.19 	credit received under section 273.135 must be separately stated and identified as "taconite 
88.20 	tax relief"; and
88.21 	(7) the net tax payable in the manner required in paragraph (a).
88.22 	(d) If the county uses envelopes for mailing property tax statements and if the county 
88.23 	agrees, a taxing district may include a notice with the property tax statement notifying 
88.24 	taxpayers when the taxing district will begin its budget deliberations for the current 
88.25 	year, and encouraging taxpayers to attend the hearings. If the county allows notices to 
88.26 	be included in the envelope containing the property tax statement, and if more than 
88.27 	one taxing district relative to a given property decides to include a notice with the tax 
88.28 	statement, the county treasurer or auditor must coordinate the process and may combine 
88.29 	the information on a single announcement.

88.30 	EFFECTIVE DATE. This section is effective for tax statements relating to taxes 
88.31 	payable in 2014 and thereafter.

88.32 	Sec. 9. Minnesota Statutes 2010, section 290A.04, subdivision 2h, is amended to read:
88.33 		Subd. 2h.Additional refund. (a) If the gross property taxes payable on a homestead 
88.34 	increase more than 12 percent over the property taxes payable in the prior year on the same 
88.35 	property that is owned and occupied by the same owner on January 2 of both years, and the 
89.1 	amount of that increase is $100 or more, a claimant who is a homeowner shall be allowed 
89.2 	an additional refund equal to 60 75 percent of the amount of the increase over the greater 
89.3 	of 12 percent of the prior year's property taxes payable or $100. This subdivision shall not 
89.4 	apply to any increase in the gross property taxes payable attributable to improvements 
89.5 	made to the homestead after the assessment date for the prior year's taxes. This subdivision 
89.6 	shall not apply to any increase in the gross property taxes payable attributable to the 
89.7 	termination of valuation exclusions under section 273.11, subdivision 16.
89.8 	The maximum refund allowed under this subdivision is $1,000.
89.9 	(b) For purposes of this subdivision "gross property taxes payable" means property 
89.10 	taxes payable determined without regard to the refund allowed under this subdivision.
89.11 	(c) In addition to the other proofs required by this chapter, each claimant under 
89.12 	this subdivision shall file with the property tax refund return a copy of the property tax 
89.13 	statement for taxes payable in the preceding year or other documents required by the 
89.14 	commissioner.
89.15 	(d) Upon request, the appropriate county official shall make available the names and 
89.16 	addresses of the property taxpayers who may be eligible for the additional property tax 
89.17 	refund under this section. The information shall be provided on a magnetic computer 
89.18 	disk. The county may recover its costs by charging the person requesting the information 
89.19 	the reasonable cost for preparing the data. The information may not be used for any 
89.20 	purpose other than for notifying the homeowner of potential eligibility and assisting the 
89.21 	homeowner, without charge, in preparing a refund claim.

89.22 	EFFECTIVE DATE. This section is effective beginning with refunds based on 
89.23 	taxes payable in 2013.

89.24 	Sec. 10. [471.703] EXPENDITURE TYPE REPORTING.
89.25 		Subdivision 1.Purpose. In order to facilitate involvement of the public in local 
89.26 	government budgeting, municipalities shall provide the following budgetary information 
89.27 	on a municipal Web site, except as provided in subdivision 4, and publicize the availability 
89.28 	of this information as part of the property tax and budget notices required in section 
89.29 	275.065.
89.30 		Subd. 2.Definitions. (a) For purposes of this section, the following terms have the 
89.31 	meanings given in this subdivision.
89.32 	(b) "Municipality" means a county with a population of more than 5,000 or a home 
89.33 	rule charter or statutory city with a population of more than 5,000.
89.34 	(c) "Population" means the population of the municipality as established by the last 
89.35 	federal census, by a special census conducted under contract with the United States Bureau 
90.1 	of the Census, by a population estimate made by the Metropolitan Council pursuant to 
90.2 	section 473.24, or by a population estimate of the state demographer made pursuant to 
90.3 	section 4A.02, whichever is the most recent as to the stated date of the count or estimate for 
90.4 	the preceding calendar year, and which has been certified to the commissioner of revenue 
90.5 	on or before July 15 of the year in which the information is required to be reported.
90.6 		Subd. 3.Electronic budgetary information. (a) By July 31 of each year, a 
90.7 	municipality shall publish on its Web site, except as provided in subdivision 4, four years 
90.8 	of budget information on both revenues and expenditures organized by function and by 
90.9 	expenditure type. The four years shall include actual data from the three most recently 
90.10 	concluded budget years and estimated data for the current budget year.
90.11 	(b) The governmental funds included in the budget information required under 
90.12 	this section shall include the municipality's general fund, debt service fund, and special 
90.13 	revenue funds, except for special revenue funds specifically used for the acquisition and 
90.14 	construction of major capital facilities. The reported information shall also exclude 
90.15 	enterprise funds and fiduciary funds.
90.16 	(c) The forms and reporting requirements for revenues and expenditures by function 
90.17 	shall be established by the state auditor's office and shall be based on the revenue and 
90.18 	expenditure breakdowns used by that office in the five-year summary tables for annual 
90.19 	revenue, expenditure, and debt reports for counties and cities with a population over 
90.20 	2,500, under section 6.75.
90.21 	(d) The forms and reporting requirements for expenditures by expenditure type shall 
90.22 	be established by the state auditor's office and at minimum shall include the following line 
90.23 	items: employee costs, purchased services, supplies, central services, capital items, debt 
90.24 	service, transfer to other funds, and miscellaneous; with employee costs further subdivided 
90.25 	into the following items: wages and salaries, pensions, Social Security, health care, and 
90.26 	other benefits. The state auditor shall consult with the commissioner of management and 
90.27 	budget, city and county representatives, and members of the governmental accounting 
90.28 	community in developing the definition of expenditure types for reporting purposes.
90.29 		Subd. 4.Alternative publication of budgetary information. A municipality 
90.30 	that does not maintain an official Web site must either (1) set up a separate Web site to 
90.31 	make accessible the budgetary information as required in subdivision 3, or (2) publish the 
90.32 	same information required in subdivision 3 by August 31 of each year in one issue of the 
90.33 	official newspaper of the municipality. If a county publishes the information in its official 
90.34 	newspaper it must also publish the same information in one other newspaper, if one of 
90.35 	general circulation is located in a different city in the county than the official newspaper. 
90.36 	The state auditor must prescribe the form for the newspaper notice.
91.1 		Subd. 5.Incentives. In 2012 only, a city or county that complies with the 
91.2 	requirement of this section and section 6.91, subdivision 1, shall receive the benefits 
91.3 	pursuant to section 6.91, subdivision 2.
91.4 		Subd. 6.Penalties. In 2013 and thereafter, failure of a municipality to provide 
91.5 	the information required in this section shall result in the withholding of aids payable 
91.6 	the following calendar year under sections 162.01 to 162.14, 423A.02, and 477A.011 
91.7 	to 477A.014.

91.8 	EFFECTIVE DATE. This section is effective July 1, 2012.

91.9 	Sec. 11. Minnesota Statutes 2010, section 477A.017, subdivision 3, is amended to read:
91.10 		Subd. 3.Conformity. Other law to the contrary notwithstanding, in order to receive 
91.11 	distributions under sections 477A.011 to 477A.03, counties and cities must conform to 
91.12 	the standards set in subdivision 2 in making all financial reports required to be made to 
91.13 	the state auditor after June 30, 1984 by the deadline set by the state auditor. Counties and 
91.14 	cities that fail to submit the required information to the state auditor within 45 days of 
91.15 	the reporting deadline shall forfeit an amount equal to ten percent of the distributions 
91.16 	under sections 477A.011 to 477A.03. Counties and cities that fail to submit the required 
91.17 	information within 60 days of the reporting deadline shall forfeit an amount equal to 30 
91.18 	percent of the distributions. Counties and cities that fail to submit the required information 
91.19 	within 90 days of the reporting deadline shall forfeit an amount equal to 50 percent of the 
91.20 	distributions.

91.21 	EFFECTIVE DATE. This section is effective for financial reports for calendar 
91.22 	year 2012 and thereafter.

91.23 	Sec. 12. Laws 1988, chapter 645, section 3, as amended by Laws 1999, chapter 243, 
91.24 	article 6, section 9, Laws 2000, chapter 490, article 6, section 15, and Laws 2008, chapter 
91.25 	154, article 2, section 30, is amended to read:
91.26 	Sec. 3. TAX; PAYMENT OF EXPENSES.
 91.27 	(a) The tax levied by the hospital district under Minnesota Statutes, section 447.34, 
91.28 	must not be levied at a rate that exceeds the amount authorized to be levied under that 
91.29 	section. The proceeds of the tax may be used for all purposes of the hospital district, 
91.30 	except as provided in paragraph (b).
91.31 	(b) 0.015 percent of taxable market value of the tax in paragraph (a) may be used 
91.32 	solely by the Cook ambulance service and the Orr ambulance service for the purpose of 
91.33 	capital expenditures as it relates to:
92.1 	(1) ambulance acquisitions for the Cook ambulance service and the Orr ambulance 
92.2 	service and not;
92.3 	(2) attached and portable equipment for use in and for the ambulances; and
92.4 	(3) parts and replacement parts for maintenance and repair of the ambulances.
92.5 	The money may not be used for administrative, operation,  or salary expenses.
92.6 	(c) The part of the levy referred to in paragraph (b) must be administered by the Cook 
92.7 	Hospital and passed on directly to the Cook area ambulance service board and the city of 
92.8 	Orr to be held in trust until funding for a new ambulance is needed by either the Cook 
92.9 	ambulance service or the Orr ambulance service used for the purposes in paragraph (b).

92.10 	Sec. 13. Laws 1999, chapter 243, article 6, section 11, is amended to read:
92.11 	Sec. 11. CEMETERY LEVY FOR SAWYER BY CARLTON COUNTY.
 92.12 		Subdivision 1.Levy authorized. Notwithstanding other law to the contrary, the 
92.13 	Carlton county board of commissioners may annually levy in and for the unorganized 
92.14 	township of Sawyer an amount up to $1,000 annually for cemetery purposes, beginning 
92.15 	with taxes payable in 2000 and ending with taxes payable in 2009.
92.16 		Subd. 2.Effective date. This section is effective June 1, 1999, without local 
92.17 	approval.

92.18 	EFFECTIVE DATE; LOCAL APPROVAL. This section applies to taxes 
92.19 	payable in 2013 and thereafter, and is effective the day after the Carlton county board 
92.20 	of commissioners and its chief clerical officer timely complete their compliance with 
92.21 	Minnesota Statutes, section 645.021, subdivisions 2 and 3.

92.22 	Sec. 14. Laws 2010, chapter 389, article 1, section 12, the effective date, is amended to 
92.23 	read:

92.24 	EFFECTIVE DATE. This section is effective for assessment years year 2010 and 
92.25 	2011, for taxes payable in 2011 and 2012 thereafter.

92.26 	EFFECTIVE DATE. This section is effective for assessment year 2012 and 
92.27 	thereafter.

92.28 	Sec. 15. HOLDING OF PROPERTY FOR ECONOMIC DEVELOPMENT; 
92.29 	TEMPORARY EXTENSION.
 92.30 	(a) For purposes of Minnesota Statutes, section 272.02, subdivision 39, a political 
92.31 	subdivision's holding for resale for economic development of a property that is located in 
93.1 	a city in the metropolitan area, or in a city with a population of more than 5,000 outside 
93.2 	of the metropolitan area, as defined in Minnesota Statutes, section 473.121, subdivision 
93.3 	2, for up to ten years, is a public purpose.
93.4 	(b) The authority under this section expires on December 31, 2015.

93.5 	EFFECTIVE DATE. This section is effective the day following final enactment.

93.6 	Sec. 16.  REPEALER.
 93.7 	Minnesota Statutes 2010, section 270C.991, subdivision 5, is repealed.

93.8 	EFFECTIVE DATE. This section is effective the day following final enactment.

93.9 	ARTICLE 8
93.10 	INDIVIDUAL INCOME AND CORPORATE FRANCHISE TAXES

93.11 	Section 1. Minnesota Statutes 2011 Supplement, section 116J.8737, subdivision 1, 
93.12 	is amended to read:
93.13 		Subdivision 1.Definitions. (a) For the purposes of this section, the following terms 
93.14 	have the meanings given.
93.15 	(b) "Qualified small business" means a business that has been certified by the 
93.16 	commissioner under subdivision 2.
93.17 	(c) "Qualified investor" means an investor who has been certified by the 
93.18 	commissioner under subdivision 3.
93.19 	(d) "Qualified fund" means a pooled angel investment network fund that has been 
93.20 	certified by the commissioner under subdivision 4.
93.21 	(e) "Qualified investment" means a cash investment in a qualified small business 
93.22 	of a minimum of:
93.23 	(1) $10,000 in a calendar year by a qualified investor; or
93.24 	(2) $30,000 in a calendar year by a qualified fund.
93.25 	A qualified investment must be made in exchange for common stock, a partnership 
93.26 	or membership interest, preferred stock, debt with mandatory conversion to equity, or an 
93.27 	equivalent ownership interest as determined by the commissioner.
93.28 	(f) "Family" means a family member within the meaning of the Internal Revenue 
93.29 	Code, section 267(c)(4).
93.30 	(g) "Pass-through entity" means a corporation that for the applicable taxable year is 
93.31 	treated as an S corporation or a general partnership, limited partnership, limited liability 
93.32 	partnership, trust, or limited liability company and which for the applicable taxable year is 
93.33 	not taxed as a corporation under chapter 290.
94.1 	(h) "Intern" means a student of an accredited institution of higher education, or a 
94.2 	former student who has graduated in the past six months from an accredited institution 
94.3 	of higher education, who is employed by a qualified small business in a nonpermanent 
94.4 	position for a duration of nine months or less that provides training and experience in the 
94.5 	primary business activity of the business.
94.6 	(i) "Liquidation event" means a conversion of qualified investment for cash, cash 
94.7 	and other consideration, or any other form of equity or debt interest.

94.8 	EFFECTIVE DATE. This section is effective for qualified small businesses 
94.9 	certified after June 30, 2012.

94.10 	Sec. 2. Minnesota Statutes 2011 Supplement, section 116J.8737, subdivision 2, is 
94.11 	amended to read:
94.12 		Subd. 2.Certification of qualified small businesses. (a) Businesses may apply 
94.13 	to the commissioner for certification as a qualified small business for a calendar year. 
94.14 	The application must be in the form and be made under the procedures specified by the 
94.15 	commissioner, accompanied by an application fee of $150. Application fees are deposited 
94.16 	in the small business investment tax credit administration account in the special revenue 
94.17 	fund. The application for certification for 2010 must be made available on the department's 
94.18 	Web site by August 1, 2010. Applications for subsequent years' certification must be made 
94.19 	available on the department's Web site by November 1 of the preceding year.
94.20 	(b) Within 30 days of receiving an application for certification under this subdivision, 
94.21 	the commissioner must either certify the business as satisfying the conditions required of a 
94.22 	qualified small business, request additional information from the business, or reject the 
94.23 	application for certification. If the commissioner requests additional information from the 
94.24 	business, the commissioner must either certify the business or reject the application within 
94.25 	30 days of receiving the additional information. If the commissioner neither certifies the 
94.26 	business nor rejects the application within 30 days of receiving the original application or 
94.27 	within 30 days of receiving the additional information requested, whichever is later, then 
94.28 	the application is deemed rejected, and the commissioner must refund the $150 application 
94.29 	fee. A business that applies for certification and is rejected may reapply.
94.30 	(c) To receive certification, a business must satisfy all of the following conditions:
94.31 	(1) the business has its headquarters in Minnesota;
94.32 	(2) at least 51 percent of the business's employees are employed in Minnesota, and 
94.33 	51 percent of the business's total payroll is paid or incurred in the state;
94.34 	(3) the business is engaged in, or is committed to engage in, innovation in Minnesota 
94.35 	in one of the following as its primary business activity:
95.1 	(i) using proprietary technology to add value to a product, process, or service in a 
95.2 	qualified high-technology field;
95.3 	(ii) researching or developing a proprietary product, process, or service in a qualified 
95.4 	high-technology field; or
95.5 	(iii) researching, developing, or producing a new proprietary technology for use in 
95.6 	the fields of agriculture, tourism, forestry, mining, manufacturing, or transportation;
95.7 	(4) other than the activities specifically listed in clause (3), the business is not 
95.8 	engaged in real estate development, insurance, banking, lending, lobbying, political 
95.9 	consulting, information technology consulting, wholesale or retail trade, leisure, 
95.10 	hospitality, transportation, construction, ethanol production from corn, or professional 
95.11 	services provided by attorneys, accountants, business consultants, physicians, or health 
95.12 	care consultants;
95.13 	(5) the business has fewer than 25 employees;
95.14 	(6) the business must pay its employees annual wages of at least 175 percent of the 
95.15 	federal poverty guideline for the year for a family of four and must pay its interns annual 
95.16 	wages of at least 175 percent of the federal minimum wage used for federally covered 
95.17 	employers, except that this requirement must be reduced proportionately for employees 
95.18 	and interns who work less than full-time, and does not apply to an executive, officer, or 
95.19 	member of the board of the business, or to any employee who owns, controls, or holds 
95.20 	power to vote more than 20 percent of the outstanding securities of the business;
95.21 	(7) the business has not been in operation for more than ten years, except as provided 
95.22 	in clause (8);
95.23 	(8) the business has not been in operation for more than 20 years if the business is 
95.24 	engaged in the research, development, or production of medical devices or pharmaceuticals 
95.25 	for which U.S. Food and Drug Administration approval is required for use in the treatment 
95.26 	or diagnosis of a disease or condition;
95.27 	(8) (9) the business has not previously received private equity investments of more 
95.28 	than $4,000,000; and
95.29 	(9) (10) the business is not an entity disqualified under section 80A.50, paragraph 
95.30 	(b), clause (3); and
95.31 	(11) the business has not issued securities that are traded on a public exchange.
95.32 	(d) In applying the limit under paragraph (c), clause (5), the employees in all 
95.33 	members of the unitary business, as defined in section 290.17, subdivision 4, must be 
95.34 	included.
95.35 	(e) In order for a qualified investment in a business to be eligible for tax credits,:
96.1 	(1) the business must have applied for and received certification for the calendar 
96.2 	year in which the investment was made prior to the date on which the qualified investment 
96.3 	was made.;
96.4 	(2) the business must not have issued securities that are traded on a public exchange;
96.5 	(3) the business must not issue securities that are traded on a public exchange within 
96.6 	180 days subsequent to the date on which the qualified investment was made; and
96.7 	(4) the business must not have a liquidation event within 180 days subsequent to the 
96.8 	date on which the qualified investment was made.
96.9 	(f) The commissioner must maintain a list of businesses certified under this 
96.10 	subdivision for the calendar year and make the list accessible to the public on the 
96.11 	department's Web site.
96.12 	(g) For purposes of this subdivision, the following terms have the meanings given:
96.13 	(1) "qualified high-technology field" includes aerospace, agricultural processing, 
96.14 	renewable energy, energy efficiency and conservation, environmental engineering, food 
96.15 	technology, cellulosic ethanol, information technology, materials science technology, 
96.16 	nanotechnology, telecommunications, biotechnology, medical device products, 
96.17 	pharmaceuticals, diagnostics, biologicals, chemistry, veterinary science, and similar 
96.18 	fields; and
96.19 	(2) "proprietary technology" means the technical innovations that are unique and 
96.20 	legally owned or licensed by a business and includes, without limitation, those innovations 
96.21 	that are patented, patent pending, a subject of trade secrets, or copyrighted.

96.22 	EFFECTIVE DATE. This section is effective for qualified small businesses 
96.23 	certified after June 30, 2012, except the amendments to paragraph (c), clause (7), and 
96.24 	paragraph (c), adding clause (8), are effective the day following final enactment.

96.25 	Sec. 3. Minnesota Statutes 2010, section 116J.8737, subdivision 5, is amended to read:
96.26 		Subd. 5.Credit allowed. (a) A qualified investor or qualified fund is eligible for 
96.27 	a credit equal to 25 percent of the qualified investment in a qualified small business. 
96.28 	Investments made by a pass-through entity qualify for a credit only if the entity is a 
96.29 	qualified fund. The commissioner must not allocate more than $11,000,000 in credits to 
96.30 	qualified investors or qualified funds for taxable years beginning after December 31, 
96.31 	2009, and before January 1, 2011, and must not allocate more than $12,000,000 in credits 
96.32 	per year for taxable years beginning after December 31, 2010, and before January 1, 
96.33 	2015 2012, must not allocate more than $16,500,000 in credits per year for taxable years 
96.34 	beginning after December 31, 2011, and before January 1, 2013, and must not allocate 
96.35 	more than $12,000,000 in credits per year for taxable years beginning after December 31, 
97.1 	2012, and before January 1, 2015. Any portion of a taxable year's credits that is not 
97.2 	allocated by the commissioner does not cancel and may be carried forward to subsequent 
97.3 	taxable years until all credits have been allocated.
97.4 	(b) The commissioner may not allocate more than a total maximum amount in credits 
97.5 	for a taxable year to a qualified investor for the investor's cumulative qualified investments 
97.6 	as an individual qualified investor and as an investor in a qualified fund; for married 
97.7 	couples filing joint returns the maximum is $250,000, and for all other filers the maximum 
97.8 	is $125,000. The commissioner may not allocate more than a total of $1,000,000 in credits 
97.9 	over all taxable years for qualified investments in any one qualified small business.
97.10 	(c) The commissioner may not allocate a credit to a qualified investor either as an 
97.11 	individual qualified investor or as an investor in a qualified fund if the investor receives 
97.12 	more than 50 percent of the investor's gross annual income from the qualified small 
97.13 	business in which the qualified investment is proposed. A member of the family of an 
97.14 	individual disqualified by this paragraph is not eligible for a credit under this section. For 
97.15 	a married couple filing a joint return, the limitations in this paragraph apply collectively 
97.16 	to the investor and spouse. For purposes of determining the ownership interest of an 
97.17 	investor under this paragraph, the rules under section 267(c) and 267(e) of the Internal 
97.18 	Revenue Code apply.
97.19 	(d) Applications for tax credits for 2010 must be made available on the department's 
97.20 	Web site by September 1, 2010, and the department must begin accepting applications 
97.21 	by September 1, 2010. Applications for subsequent years must be made available by 
97.22 	November 1 of the preceding year.
97.23 	(e) Qualified investors and qualified funds must apply to the commissioner for tax 
97.24 	credits. Tax credits must be allocated to qualified investors or qualified funds in the order 
97.25 	that the tax credit request applications are filed with the department. The commissioner 
97.26 	must approve or reject tax credit request applications within 15 days of receiving the 
97.27 	application. The investment specified in the application must be made within 60 days of 
97.28 	the allocation of the credits. If the investment is not made within 60 days, the credit 
97.29 	allocation is canceled and available for reallocation. A qualified investor or qualified fund 
97.30 	that fails to invest as specified in the application, within 60 days of allocation of the 
97.31 	credits, must notify the commissioner of the failure to invest within five business days of 
97.32 	the expiration of the 60-day investment period.
97.33 	(f) All tax credit request applications filed with the department on the same day must 
97.34 	be treated as having been filed contemporaneously. If two or more qualified investors or 
97.35 	qualified funds file tax credit request applications on the same day, and the aggregate 
97.36 	amount of credit allocation claims exceeds the aggregate limit of credits under this section 
98.1 	or the lesser amount of credits that remain unallocated on that day, then the credits must 
98.2 	be allocated among the qualified investors or qualified funds who filed on that day on a 
98.3 	pro rata basis with respect to the amounts claimed. The pro rata allocation for any one 
98.4 	qualified investor or qualified fund is the product obtained by multiplying a fraction, 
98.5 	the numerator of which is the amount of the credit allocation claim filed on behalf of 
98.6 	a qualified investor and the denominator of which is the total of all credit allocation 
98.7 	claims filed on behalf of all applicants on that day, by the amount of credits that remain 
98.8 	unallocated on that day for the taxable year.
98.9 	(g) A qualified investor or qualified fund, or a qualified small business acting on their 
98.10 	behalf, must notify the commissioner when an investment for which credits were allocated 
98.11 	has been made, and the taxable year in which the investment was made. A qualified fund 
98.12 	must also provide the commissioner with a statement indicating the amount invested by 
98.13 	each investor in the qualified fund based on each investor's share of the assets of the 
98.14 	qualified fund at the time of the qualified investment. After receiving notification that the 
98.15 	investment was made, the commissioner must issue credit certificates for the taxable year 
98.16 	in which the investment was made to the qualified investor or, for an investment made by 
98.17 	a qualified fund, to each qualified investor who is an investor in the fund. The certificate 
98.18 	must state that the credit is subject to revocation if the qualified investor or qualified 
98.19 	fund does not hold the investment in the qualified small business for at least three years, 
98.20 	consisting of the calendar year in which the investment was made and the two following 
98.21 	years. The three-year holding period does not apply if:
98.22 	(1) the investment by the qualified investor or qualified fund becomes worthless 
98.23 	before the end of the three-year period;
98.24 	(2) 80 percent or more of the assets of the qualified small business is sold before 
98.25 	the end of the three-year period;
98.26 	(3) the qualified small business is sold before the end of the three-year period; or
98.27 	(4) the qualified small business's common stock begins trading on a public exchange 
98.28 	before the end of the three-year period.
98.29 	(h) The commissioner must notify the commissioner of revenue of credit certificates 
98.30 	issued under this section.

98.31 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
98.32 	December 31, 2011.

98.33 	Sec. 4. Minnesota Statutes 2010, section 116J.8737, is amended by adding a 
98.34 	subdivision to read:
99.1 		Subd. 5a.Promotion of credit in greater Minnesota. (a) By July 1, 2012, the 
99.2 	commissioner shall develop a plan to increase awareness of and use of the credit for 
99.3 	investments in greater Minnesota businesses with a target goal that a minimum of 30 
99.4 	percent of the credit will be awarded for those investments during the second half 
99.5 	of calendar year 2013 and for each full calendar year thereafter. Beginning with the 
99.6 	legislative report due on March 15, 2013, under subdivision 9, the commissioner shall 
99.7 	report on its plan under this subdivision and the results achieved.
99.8 	(b) If the target goal of 30 percent under paragraph (a) is not achieved for the 
99.9 	six-month period ending on December 31, 2013, the credit percentage under subdivision 
99.10 	5, paragraph (a), is increased to 40 percent for a qualified investment made after December 
99.11 	31, 2013, in a greater Minnesota business. This paragraph does not apply and the credit 
99.12 	percentage for all qualified investments is the rate provided under subdivision 5 for any 
99.13 	calendar year beginning after a calendar year for which the commissioner determines the 
99.14 	30 percent target has been satisfied. The commissioner shall timely post notification of 
99.15 	changes in the credit rate under this paragraph on the department's website.
99.16 	(c) For purposes of this section, a "greater Minnesota business" means a qualified 
99.17 	small business with its headquarters and 51 percent or more of its employees employed 
99.18 	at Minnesota locations outside of the metropolitan area as defined in section 473.121, 
99.19 	subdivision 2.

99.20 	EFFECTIVE DATE. This section is effective the day following final enactment.

99.21 	Sec. 5. Minnesota Statutes 2010, section 116J.8737, subdivision 8, is amended to read:
99.22 		Subd. 8.Data privacy. (a) Data contained in an application submitted to the 
99.23 	commissioner under subdivision 2, 3, or 4 are nonpublic data, or private data on 
99.24 	individuals, as defined in section 13.02, subdivision 9 or 12, except that the following 
99.25 	data items are public:
99.26 	(1) the name, mailing address, telephone number, e-mail address, contact person's 
99.27 	name, and industry type of a qualified small business upon approval of the application 
99.28 	and certification by the commissioner under subdivision 2;
99.29 	(2) the name of a qualified investor upon approval of the application and certification 
99.30 	by the commissioner under subdivision 3;
99.31 	(3) the name of a qualified fund upon approval of the application and certification 
99.32 	by the commissioner under subdivision 4;
99.33 	(4) for credit certificates issued under subdivision 5, the amount of the credit 
99.34 	certificate issued, amount of the qualifying investment, the name of the qualifying investor 
100.1 	or qualifying fund that received the certificate, and the name of the qualifying small 
100.2 	business in which the qualifying investment was made;
100.3 	(5) for credits revoked under subdivision 7, paragraph (a), the amount revoked and 
100.4 	the name of the qualified investor or qualified fund; and
100.5 	(6) for credits revoked under subdivision 7, paragraphs (b) and (c), the amount 
100.6 	revoked and the name of the qualified small business.
100.7 	(b) The following data, including data classified as nonpublic or private, must be 
100.8 	provided to the consultant for use in conducting the program evaluation under subdivision 
100.9 	10:
100.10 	(1) the commissioner of employment and economic development shall provide data 
100.11 	contained in an application for certification received from a qualified small business, 
100.12 	qualified investor, or qualified fund, and any annual reporting information received on a 
100.13 	qualified small business, qualified investor, or qualified fund; and
100.14 	(2) the commissioner of revenue shall provide data contained in any applicable tax 
100.15 	returns of a qualified small business, qualified investor, or qualified fund.

100.16 	EFFECTIVE DATE. This section is effective for businesses requesting certification 
100.17 	starting on the day following final enactment.

100.18 	Sec. 6. Minnesota Statutes 2011 Supplement, section 289A.02, subdivision 7, is 
100.19 	amended to read:
100.20 		Subd. 7.Internal Revenue Code. Unless specifically defined otherwise, "Internal 
100.21 	Revenue Code" means the Internal Revenue Code of 1986, as amended through April 14, 
100.22 	2011 February 14, 2012.

100.23 	EFFECTIVE DATE. This section is effective the day following final enactment.

100.24 	Sec. 7. Minnesota Statutes 2011 Supplement, section 290.01, subdivision 19, is 
100.25 	amended to read:
100.26 		Subd. 19.Net income. The term "net income" means the federal taxable income, 
100.27 	as defined in section 63 of the Internal Revenue Code of 1986, as amended through the 
100.28 	date named in this subdivision, incorporating the federal effective dates of changes to the 
100.29 	Internal Revenue Code and any elections made by the taxpayer in accordance with the 
100.30 	Internal Revenue Code in determining federal taxable income for federal income tax 
100.31 	purposes, and with the modifications provided in subdivisions 19a to 19f.
100.32 	In the case of a regulated investment company or a fund thereof, as defined in section 
100.33 	851(a) or 851(g) of the Internal Revenue Code, federal taxable income means investment 
101.1 	company taxable income as defined in section 852(b)(2) of the Internal Revenue Code, 
101.2 	except that:
101.3 	(1) the exclusion of net capital gain provided in section 852(b)(2)(A) of the Internal 
101.4 	Revenue Code does not apply;
101.5 	(2) the deduction for dividends paid under section 852(b)(2)(D) of the Internal 
101.6 	Revenue Code must be applied by allowing a deduction for capital gain dividends and 
101.7 	exempt-interest dividends as defined in sections 852(b)(3)(C) and 852(b)(5) of the Internal 
101.8 	Revenue Code; and
101.9 	(3) the deduction for dividends paid must also be applied in the amount of any 
101.10 	undistributed capital gains which the regulated investment company elects to have treated 
101.11 	as provided in section 852(b)(3)(D) of the Internal Revenue Code.
101.12 	The net income of a real estate investment trust as defined and limited by section 
101.13 	856(a), (b), and (c) of the Internal Revenue Code means the real estate investment trust 
101.14 	taxable income as defined in section 857(b)(2) of the Internal Revenue Code.
101.15 	The net income of a designated settlement fund as defined in section 468B(d) of 
101.16 	the Internal Revenue Code means the gross income as defined in section 468B(b) of the 
101.17 	Internal Revenue Code.
101.18 	The Internal Revenue Code of 1986, as amended through April 14, 2011 February 
101.19 	14, 2012, shall be in effect for taxable years beginning after December 31, 1996. The 
101.20 	provisions of the act of January 22, 2010, Public Law 111-126, to accelerate the benefits 
101.21 	for charitable cash contributions for the relief of victims of the Haitian earthquake, are 
101.22 	effective at the same time they became effective for federal purposes and apply to the 
101.23 	subtraction under subdivision 19b, clause (6). The provisions of title II, section 2112, of 
101.24 	the act of September 27, 2010, Public Law 111-240, rollovers from elective deferral plans 
101.25 	to designated Roth accounts, are effective at the same time they became effective for 
101.26 	federal purposes and taxable rollovers are included in net income at the same time they are 
101.27 	included in gross income for federal purposes.
101.28 	Except as otherwise provided, references to the Internal Revenue Code in 
101.29 	subdivisions 19 to 19f mean the code in effect for purposes of determining net income for 
101.30 	the applicable year.

101.31 	EFFECTIVE DATE. This section is effective the day following final enactment.

101.32 	Sec. 8. Minnesota Statutes 2011 Supplement, section 290.01, subdivision 31, is 
101.33 	amended to read:
101.34 		Subd. 31.Internal Revenue Code. Unless specifically defined otherwise, "Internal 
101.35 	Revenue Code" means the Internal Revenue Code of 1986, as amended through April 14, 
102.1 	2011 February 14, 2012. Internal Revenue Code also includes any uncodified provision in 
102.2 	federal law that relates to provisions of the Internal Revenue Code that are incorporated 
102.3 	into Minnesota law. When used in this chapter, the reference to "subtitle A, chapter 1, 
102.4 	subchapter N, part 1, of the Internal Revenue Code" is to the Internal Revenue Code as 
102.5 	amended through March 18, 2010.

102.6 	EFFECTIVE DATE. This section is effective the day following final enactment.

102.7 	Sec. 9. Minnesota Statutes 2010, section 290.068, subdivision 1, is amended to read:
102.8 		Subdivision 1.Credit allowed. A corporation, partners in a partnership, or 
102.9 	shareholders in a corporation treated as an "S" corporation under section 290.9725 are 
102.10 	allowed a credit against the tax computed under this chapter for the taxable year equal to:
102.11 	(a) ten percent of the first $2,000,000 of the excess (if any) of
102.12 	(1) the qualified research expenses for the taxable year, over
102.13 	(2) the base amount; and
102.14 	(b) 2.5 2.8 percent on all of such excess expenses over $2,000,000 for taxable years 
102.15 	beginning after December 31, 2011.

102.16 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
102.17 	December 31, 2011.

102.18 	Sec. 10. Minnesota Statutes 2010, section 290.0681, subdivision 1, is amended to read:
102.19 		Subdivision 1.Definitions. (a) For purposes of this section, the following terms 
102.20 	have the meanings given.
102.21 	(b) "Account" means the historic credit administration account in the special 
102.22 	revenue fund.
102.23 	(c) "Office" means the State Historic Preservation Office of the Minnesota Historical 
102.24 	Society.
102.25 	(d) "Project" means rehabilitation of a certified historic structure, as defined in 
102.26 	section 47(c)(3)(A) of the Internal Revenue Code, that is located in Minnesota and is 
102.27 	allowed a federal credit under section 47(a)(2) of the Internal Revenue Code.
102.28 	(e) "Society" means the Minnesota Historical Society.
102.29 	(f) "Federal credit" means the credit allowed under section 47(a)(2) of the Internal 
102.30 	Revenue Code.
102.31 	(g) "Placed in service" has the meaning used in section 47 of the Internal Revenue 
102.32 	Code.
103.1 	(h) "Qualified rehabilitation expenditures" has the meaning given in section 47 of 
103.2 	the Internal Revenue Code.

103.3 	EFFECTIVE DATE. This section is effective the day following final enactment.

103.4 	Sec. 11. Minnesota Statutes 2010, section 290.0681, subdivision 3, is amended to read:
103.5 		Subd. 3.Applications; allocations. (a) To qualify for a credit or grant under this 
103.6 	section, the developer of a project must apply to the office before the rehabilitation begins. 
103.7 	The application must contain the information and be in the form prescribed by the office. 
103.8 	The office may collect a fee for application of up to $5,000, based on estimated qualified 
103.9 	rehabilitation expenses expenditures, to offset costs associated with personnel and 
103.10 	administrative expenses related to administering the credit and preparing the economic 
103.11 	impact report in subdivision 9. Application fees are deposited in the account. The 
103.12 	application must indicate if the application is for a credit or a grant in lieu of the credit 
103.13 	or a combination of the two and designate the taxpayer qualifying for the credit or the 
103.14 	recipient of the grant.
103.15 	(b) Upon approving an application for credit, the office shall issue allocation 
103.16 	certificates that:
103.17 	(1) verify eligibility for the credit or grant;
103.18 	(2) state the amount of credit or grant anticipated with the project, with the credit 
103.19 	amount equal to 100 percent and the grant amount equal to 90 percent of the federal 
103.20 	credit anticipated in the application;
103.21 	(3) state that the credit or grant allowed may increase or decrease if the federal 
103.22 	credit the project receives at the time it is placed in service is different than the amount 
103.23 	anticipated at the time the allocation certificate is issued; and
103.24 	(4) state the fiscal year in which the credit or grant is allocated, and that the taxpayer 
103.25 	or grant recipient is entitled to receive the credit or grant at the time the project is placed 
103.26 	in service, provided that date is within three calendar years following the issuance of 
103.27 	the allocation certificate.
103.28 	(c) The office, in consultation with the commissioner of revenue, shall determine 
103.29 	if the project is eligible for a credit or a grant under this section and must notify the 
103.30 	developer in writing of its determination. Eligibility for the credit is subject to review 
103.31 	and audit by the commissioner of revenue.
103.32 	(d) The federal credit recapture and repayment requirements under section 50 of the 
103.33 	Internal Revenue Code do not apply to the credit allowed under this section.
104.1 	(e) Any decision of the office under paragraph (c) of this subdivision may be 
104.2 	challenged as a contested case under chapter 14. The contested case proceeding must be 
104.3 	initiated within 45 days of the date of written notification by the office.

104.4 	EFFECTIVE DATE. This section is effective the day following final enactment.

104.5 	Sec. 12. Minnesota Statutes 2010, section 290.0681, subdivision 4, is amended to read:
104.6 		Subd. 4.Credit certificates; grants. (a)(1) The developer of a project for which the 
104.7 	office has issued an allocation certificate must notify the office when the project is placed 
104.8 	in service. Upon verifying that the project has been placed in service, and was allowed a 
104.9 	federal credit, the office must issue a credit certificate to the taxpayer designated in the 
104.10 	application or must issue a grant to the recipient designated in the application. The credit 
104.11 	certificate must state the amount of the credit.
104.12 	(2) The credit amount equals the federal credit allowed for the project.
104.13 	(3) The grant amount equals 90 percent of the federal credit allowed for the project.
104.14 	(b) The recipient of a credit certificate may assign the certificate to another taxpayer, 
104.15 	which is then allowed the credit under this section or section 297I.20, subdivision 3.  An 
104.16 	assignment is not valid unless the assignee notifies the commissioner within 30 days of the 
104.17 	date that the assignment is made. The commissioner shall prescribe the forms necessary 
104.18 	for notifying the commissioner of the assignment of a credit certificate and for claiming 
104.19 	a credit by assignment.
104.20 	(c) Credits passed through pursuant to subdivision 5 of this section are not an 
104.21 	assignment of a credit certificate under this subdivision.
104.22 	(d) A grant agreement between the office and the recipient of a grant may allow the 
104.23 	grant to be issued to another individual or entity.

104.24 	EFFECTIVE DATE. This section is effective the day following final enactment.

104.25 	Sec. 13. Minnesota Statutes 2010, section 290.0681, subdivision 5, is amended to read:
104.26 		Subd. 5.Partnerships; multiple owners. Credits granted to a partnership, a limited 
104.27 	liability company taxed as a partnership, S corporation, or multiple owners of property 
104.28 	are passed through to the partners, members, shareholders, or owners, respectively, pro 
104.29 	rata to each partner, member, shareholder, or owner based on their share of the entity's 
104.30 	assets or as specially allocated in their organizational documents or any other executed 
104.31 	agreement, as of the last day of the taxable year.

104.32 	EFFECTIVE DATE. This section is effective the day following final enactment.

105.1 	Sec. 14. Minnesota Statutes 2010, section 290.0681, subdivision 10, is amended to 
105.2 	read:
105.3 		Subd. 10.Sunset. This section expires after fiscal year 2015 2021, except that 
105.4 	the office's authority to issue credit certificates under subdivision 4 based on allocation 
105.5 	certificates that were issued before fiscal year 2016 2022 remains in effect through 2018
105.6 	2024, and the reporting requirements in subdivision 9 remain in effect through the year 
105.7 	following the year in which all allocation certificates have either been canceled or resulted 
105.8 	in issuance of credit certificates, or 2019 2025, whichever is earlier.

105.9 	EFFECTIVE DATE. This section is effective the day following final enactment.

105.10 	Sec. 15. [290.0693] VETERANS JOBS TAX CREDIT.
105.11 		Subdivision 1.Definitions. (a) For purposes of this section, the following terms 
105.12 	have the meanings given.
105.13 	(b)(1) "Full-time employee" means an employee as defined in section 290.92, 
105.14 	subdivision 1, who meets the following criteria:
105.15 	(i) the employee is paid wages as defined in section 290.92, subdivision 1, for at 
105.16 	least 1,820 hours during the 12-month period that starts on the date of hire;
105.17 	(ii) the employee's wages are attributable to Minnesota under section 290.191, 
105.18 	subdivision 12;
105.19 	(iii) the employee performs services for the employer in at least 50 weeks during the 
105.20 	12-month period that starts on the date of hire; and 
105.21 	(iv) the employee's total compensation, including benefits not mandated by law, is at 
105.22 	least $25,000 for the 12-month period that starts on the date of hire.
105.23 	(2) "Full-time employee" does not include:
105.24 	(i) any employee who bears any of the relationships described in subparagraphs (A) 
105.25 	to (G) of section 152(d)(2) of the Internal Revenue Code to the employer;
105.26 	(ii) if the employer is a corporation, any employee who owns, directly or indirectly, 
105.27 	more than 50 percent in value of the outstanding stock of the corporation, or if the 
105.28 	employer is an entity other than a corporation, an employee who owns, directly or 
105.29 	indirectly, more than 50 percent of the capital and profits interests in the entity, as 
105.30 	determined with the application of section 267(c) of the Internal Revenue Code; or
105.31 	(iii) if the employer is an estate or trust, any employee who is a fiduciary of the estate 
105.32 	or trust, or is an individual who bears any of the relationships described in subparagraphs 
105.33 	(A) to (G) of section 152(d)(2) of the Internal Revenue Code to a grantor, beneficiary, 
105.34 	or fiduciary of the estate or trust.
105.35 	(c) "Qualified employer" means an employer that:
106.1 	(1) employed a total of five or more full-time employees on December 31, 2011; and
106.2 	(2) hired one or more qualified full-time employees after March 31, 2012.
106.3 	(d) "Qualified full-time employee" means a full-time employee who:
106.4 	(1) has completed 12 consecutive months of service as a full-time employee for a 
106.5 	qualified employer;
106.6 	(2) is a qualified unemployed veteran; and
106.7 	(3) is a resident of Minnesota on the date of hire.
106.8 	(e) "Qualified unemployed veteran" is a person who:
106.9 	(1) was in active military service in a designated area after September 11, 2001, 
106.10 	as defined in section 290.0677;
106.11 	(2) was separated from active military service at any time during the five-year period 
106.12 	prior to the date of hire;
106.13 	(3) received unemployment compensation under state or federal law for not less than 
106.14 	four weeks during the one-year period prior to the date of hire; and
106.15 	(4) was unemployed on the date of hire.
106.16 	(f) "Date of hire" means the day that the qualified full-time employee begins 
106.17 	performing services as an employee for the qualified employer.
106.18 	(g) "Construction trades employer" means a person carrying on a trade or business 
106.19 	described in industry code numbers 23 through 238990 of the North American Industry 
106.20 	Classification System.
106.21 		Subd. 2.Credit for new full-time employees. (a) A qualified employer who is 
106.22 	required to file a return under section 289A.08, subdivision 1, 2, or 3, is allowed a credit 
106.23 	against the tax imposed by this chapter for the net increase in qualified full-time employees.
106.24 	(b)(1) For hiring qualified full-time employees after March 30, 2012, but before 
106.25 	January 1, 2013, the credit is equal to $3,000 times the net increase in full-time employees. 
106.26 	The net increase in full-time employees is the difference between:
106.27 	(i) the total number of full-time employees employed by the employer on December 
106.28 	31, 2011; and
106.29 	(ii) the number of full-time employees employed by the employer on December 
106.30 	31, 2012.
106.31 	The net increase in full-time employees cannot exceed the number of qualified full-time 
106.32 	employees hired after March 31, 2012, but before January 1, 2013.
106.33 	(2) For hiring qualified full-time employees after December 31, 2012, but before 
106.34 	July 1, 2013, the credit is equal to $1,500 times the net increase in full-time employees. 
106.35 	The net increase in full-time employees is the difference between:
107.1 	(i) the total number of full-time employees employed by the taxpayer on December 
107.2 	31, 2011; and
107.3 	(ii) the number of full-time employees employed by the taxpayer on December 
107.4 	31, 2013.
107.5 	The net increase in full-time employees cannot exceed the number of qualified full-time 
107.6 	employees hired after December 31, 2012, but before July 1, 2013.
107.7 	(c) The credit may be claimed in the taxable year in which the qualified full-time 
107.8 	employee completes 12 consecutive months of continuous service as a full-time employee 
107.9 	of the qualified employer.
107.10 	(d) The maximum aggregate credits allowed to a qualified employer under this 
107.11 	section for all taxable years is $50,000.
107.12 	(e) For members of a unitary business whose income and factors are included on a 
107.13 	combined income report under section 289A.08, subdivision 3, the number of full-time 
107.14 	employees and the maximum allowable credit are not determined at the individual 
107.15 	member level but are instead determined at the group level.
107.16 		Subd. 3.Allocation of credits. (a) By July 1, 2012, the commissioner shall develop 
107.17 	an Internet application that allows employers to apply for tentative credits. The application 
107.18 	must include the employer's name, tax identification number, and North American Industry 
107.19 	Classification System industry code, and the name and date of hire of the employee.
107.20 	(b) The credit is available only to employers who apply for a tentative credit using 
107.21 	the application in paragraph (a) and who receive notice that their application has been 
107.22 	approved for a tentative credit.
107.23 	(c) Employers may apply for a tentative credit no earlier than the date of hire of 
107.24 	each qualified full-time employee. Any employer may file more than one tentative credit 
107.25 	application, but no employer may apply for tentative credits for more than a total of 16 
107.26 	employees hired in 2012 or 33 employees hired in 2013.
107.27 	(d) The commissioner shall approve applications seeking tentative credits for the 
107.28 	first 1,250 full-time employees based on the order in which the applications are received.
107.29 	(e) The commissioner must promptly notify employers if they are eligible for a 
107.30 	tentative credit. The notice must state that the employer is eligible for a credit only after 
107.31 	the employee named in the application has worked for 12 consecutive months and all other 
107.32 	conditions of eligibility are met.
107.33 	(f) The commissioner shall promptly publish public notice when all 2,500 tentative 
107.34 	credits have been applied for.
107.35 		Subd. 4.Tentative credits for construction trades employers. (a) Any 
107.36 	construction trades employer may apply for a tentative credit.
108.1 	(b) To remain eligible for a credit, a construction trades employer who has received 
108.2 	a tentative credit must renew the tentative credit by filing an application with the 
108.3 	commissioner no earlier than 180 days after date of hire and no more than 210 days after 
108.4 	date of hire. The renewal notice must state that the employee for whom the tentative credit 
108.5 	was originally granted is still an employee and that the employer reasonably believes that 
108.6 	all qualifications of eligibility for a credit will be met.
108.7 	(c) Any tentative credit issued to a construction trades employer that is not renewed 
108.8 	within the time required for renewal is canceled. Any canceled tentative credits are 
108.9 	available to be reissued by the commissioner to employers under subdivision 3.
108.10 		Subd. 5.Flow-through entities. Credits granted to a partnership, limited liability 
108.11 	company taxed as a partnership, S corporation, or multiple owners of a business are passed 
108.12 	through to the partners, members, shareholders, or owners, respectively, pro rata to each 
108.13 	partner, member, shareholder, or owner based on their share of the entity's assets or as 
108.14 	specially allocated in their organizational documents, as of the last day of the taxable year.
108.15 		Subd. 6.Refundable. If the amount of the credit allowed under this section exceeds 
108.16 	the liability for tax under this chapter, the commissioner shall refund the excess to the 
108.17 	taxpayer.
108.18 		Subd. 7.Appropriation. An amount sufficient to pay the refunds authorized by this 
108.19 	section is appropriated to the commissioner from the general fund.

108.20 	EFFECTIVE DATE. This section is effective the day following final enactment.

108.21 	Sec. 16. Minnesota Statutes 2011 Supplement, section 290A.03, subdivision 15, 
108.22 	is amended to read:
108.23 		Subd. 15.Internal Revenue Code.  "Internal Revenue Code" means the Internal 
108.24 	Revenue Code of 1986, as amended through April 14, 2011 February 14, 2012.

108.25 	EFFECTIVE DATE. This section is effective the day following final enactment.

108.26 	Sec. 17. Minnesota Statutes 2011 Supplement, section 291.005, subdivision 1, is 
108.27 	amended to read:
108.28 		Subdivision 1.Scope. Unless the context otherwise clearly requires, the following 
108.29 	terms used in this chapter shall have the following meanings:
108.30 	(1) "Commissioner" means the commissioner of revenue or any person to whom the 
108.31 	commissioner has delegated functions under this chapter.
109.1 	(2) "Federal gross estate" means the gross estate of a decedent as required to be 
109.2 	valued and otherwise determined for federal estate tax purposes under the Internal 
109.3 	Revenue Code.
109.4 	(3) "Internal Revenue Code" means the United States Internal Revenue Code of 
109.5 	1986, as amended through April 14, 2011 February 14, 2012, but without regard to the 
109.6 	provisions of sections 501 and 901 of Public Law 107-16, as amended by Public Law 
109.7 	111-312, and section 301(c) of Public Law 111-312.
109.8 	(4) "Minnesota adjusted taxable estate" means federal adjusted taxable estate as 
109.9 	defined by section 2011(b)(3) of the Internal Revenue Code, plus
109.10 	(i) the amount of deduction for state death taxes allowed under section 2058 of 
109.11 	the Internal Revenue Code; less
109.12 	(ii)(A) the value of qualified small business property under section 291.03, 
109.13 	subdivision 9, and the value of qualified farm property under section 291.03, subdivision 
109.14 	10, or (B) $4,000,000, whichever is less.
109.15 	(5) "Minnesota gross estate" means the federal gross estate of a decedent after (a) 
109.16 	excluding therefrom any property included therein which has its situs outside Minnesota, 
109.17 	and (b) including therein any property omitted from the federal gross estate which is 
109.18 	includable therein, has its situs in Minnesota, and was not disclosed to federal taxing 
109.19 	authorities.
109.20 	(6) "Nonresident decedent" means an individual whose domicile at the time of 
109.21 	death was not in Minnesota.
109.22 	(7) "Personal representative" means the executor, administrator or other person 
109.23 	appointed by the court to administer and dispose of the property of the decedent. If there 
109.24 	is no executor, administrator or other person appointed, qualified, and acting within this 
109.25 	state, then any person in actual or constructive possession of any property having a situs in 
109.26 	this state which is included in the federal gross estate of the decedent shall be deemed 
109.27 	to be a personal representative to the extent of the property and the Minnesota estate tax 
109.28 	due with respect to the property.
109.29 	(8) "Resident decedent" means an individual whose domicile at the time of death 
109.30 	was in Minnesota.
109.31 	(9) "Situs of property" means, with respect to real property, the state or country in 
109.32 	which it is located; with respect to tangible personal property, the state or country in which 
109.33 	it was normally kept or located at the time of the decedent's death; and with respect to 
109.34 	intangible personal property, the state or country in which the decedent was domiciled 
109.35 	at death.

109.36 	EFFECTIVE DATE. This section is effective the day following final enactment.

110.1 	Sec. 18. Laws 2010, chapter 216, section 11, the effective date, is amended to read:

110.2 	EFFECTIVE DATE. This section is effective for taxable years beginning 
110.3 	after December 31, 2009, for certified historic structures for which qualified costs of 
110.4 	rehabilitation are first paid under construction contracts entered intoafter May 1, 2010
110.5 	rehabilitation expenditures are first paid by the developer or taxpayer after May 1, 2010, 
110.6 	for rehabilitation that occurs after May 1, 2010, provided that the application under 
110.7 	subdivision 3 is submitted before the project is placed in service.

110.8 	EFFECTIVE DATE. This section is effective the day following final enactment 
110.9 	and applies retroactively for taxable years beginning after December 31, 2009, and for 
110.10 	certified historic structures placed in service after May 1, 2010, but the office may not 
110.11 	issue certificates allowed under the change to this section until July 1, 2012.

110.12 	Sec. 19. AMENDED RETURNS; CERTAIN IRA ROLLOVERS.
 110.13 	An individual who excludes an amount from net income in a prior taxable year 
110.14 	through rollover of an airline payment amount to a traditional IRA, as authorized under 
110.15 	Public Law 112-95, section 1106, may file an amended individual income tax return and 
110.16 	claim for refund of state taxes as provided under Minnesota Statutes, section 289A.40, 
110.17 	subdivision 1, or, if later, by April 15, 2013.

110.18 	EFFECTIVE DATE. This section is effective the day following final enactment.

110.19 	ARTICLE 9
110.20 	SALES AND SPECIAL TAXES

110.21 	Section 1. Minnesota Statutes 2010, section 289A.20, subdivision 4, is amended to 
110.22 	read:
110.23 		Subd. 4.Sales and use tax. (a) The taxes imposed by chapter 297A are due and 
110.24 	payable to the commissioner monthly on or before the 20th day of the month following 
110.25 	the month in which the taxable event occurred, or following another reporting period 
110.26 	as the commissioner prescribes or as allowed under section 289A.18, subdivision 4, 
110.27 	paragraph (f) or (g), except that:
110.28 	(1) use taxes due on an annual use tax return as provided under section 289A.11, 
110.29 	subdivision 1, are payable by April 15 following the close of the calendar year; and.
110.30 	(2) except as provided in paragraph (f), for a vendor having a liability of $120,000 
110.31 	or more during a fiscal year ending June 30, 2009, and fiscal years thereafter, the taxes 
111.1 	imposed by chapter 297A, except as provided in paragraph (b), are due and payable to the 
111.2 	commissioner monthly in the following manner:
111.3 	(i) On or before the 14th day of the month following the month in which the taxable 
111.4 	event occurred, the vendor must remit to the commissioner 90 percent of the estimated 
111.5 	liability for the month in which the taxable event occurred.
111.6 	(ii) On or before the 20th day of the month in which the taxable event occurs, the 
111.7 	vendor must remit to the commissioner a prepayment for the month in which the taxable 
111.8 	event occurs equal to 67 percent of the liability for the previous month.
111.9 	(iii) On or before the 20th day of the month following the month in which the taxable 
111.10 	event occurred, the vendor must pay any additional amount of tax not previously remitted 
111.11 	under either item (i) or (ii ) or, if the payment made under item (i) or (ii) was greater than 
111.12 	the vendor's liability for the month in which the taxable event occurred, the vendor may 
111.13 	take a credit against the next month's liability in a manner prescribed by the commissioner.
111.14 	(iv) Once the vendor first pays under either item (i) or (ii), the vendor is required to 
111.15 	continue to make payments in the same manner, as long as the vendor continues having a 
111.16 	liability of $120,000 or more during the most recent fiscal year ending June 30.
111.17 	(v) Notwithstanding items (i), (ii), and (iv), if a vendor fails to make the required 
111.18 	payment in the first month that the vendor is required to make a payment under either item 
111.19 	(i) or (ii), then the vendor is deemed to have elected to pay under item (ii) and must make 
111.20 	subsequent monthly payments in the manner provided in item (ii).
111.21 	(vi) For vendors making an accelerated payment under item (ii), for the first month 
111.22 	that the vendor is required to make the accelerated payment, on the 20th of that month, the 
111.23 	vendor will pay 100 percent of the liability for the previous month and a prepayment for 
111.24 	the first month equal to 67 percent of the liability for the previous month.
111.25 	(b) Notwithstanding paragraph (a), A vendor having a liability of $120,000 or more 
111.26 	during a fiscal year ending June 30 must remit the June liability for the next year in the 
111.27 	following manner:
111.28 	(1) Two business days before June 30 of the year, the vendor must remit 90 percent 
111.29 	of the estimated June liability to the commissioner.
111.30 	(2) On or before August 20 of the year, the vendor must pay any additional amount 
111.31 	of tax not remitted in June.
111.32 	(c) A vendor having a liability of:
111.33 	(1) $10,000 or more, but less than $120,000 during a fiscal year ending June 30, 
111.34 	2009, and fiscal years thereafter, must remit by electronic means all liabilities on returns 
111.35 	due for periods beginning in the subsequent calendar year on or before the 20th day of 
111.36 	the month following the month in which the taxable event occurred, or on or before the 
112.1 	20th day of the month following the month in which the sale is reported under section 
112.2 	289A.18, subdivision 4; or
112.3 	(2) $120,000 or more, during a fiscal year ending June 30, 2009, and fiscal years 
112.4 	thereafter, must remit by electronic means all liabilities in the manner provided in 
112.5 	paragraph (a), clause (2), on returns due for periods beginning in the subsequent calendar 
112.6 	year, except for 90 percent of the estimated June liability, which is due two business days 
112.7 	before June 30. The remaining amount of the June liability is due on August 20.
112.8 	(d) Notwithstanding paragraph (b) or (c), a person prohibited by the person's 
112.9 	religious beliefs from paying electronically shall be allowed to remit the payment by mail. 
112.10 	The filer must notify the commissioner of revenue of the intent to pay by mail before 
112.11 	doing so on a form prescribed by the commissioner. No extra fee may be charged to a 
112.12 	person making payment by mail under this paragraph. The payment must be postmarked 
112.13 	at least two business days before the due date for making the payment in order to be 
112.14 	considered paid on a timely basis.
112.15 	(e) Whenever the liability is $120,000 or more separately for: (1) the tax imposed 
112.16 	under chapter 297A; (2) a fee that is to be reported on the same return as and paid with the 
112.17 	chapter 297A taxes; or (3) any other tax that is to be reported on the same return as and 
112.18 	paid with the chapter 297A taxes, then the payment of all the liabilities on the return must 
112.19 	be accelerated as provided in this subdivision.
112.20 	(f) At the start of the first calendar quarter at least 90 days after the cash flow 
112.21 	account established in section 16A.152, subdivision 1, and the budget reserve account 
112.22 	established in section 16A.152, subdivision 1a, reach the amounts listed in section 
112.23 	16A.152, subdivision 2, paragraph (a), the remittance of the accelerated payments required 
112.24 	under paragraph (a), clause (2), must be suspended. The commissioner of management 
112.25 	and budget shall notify the commissioner of revenue when the accounts have reached 
112.26 	the required amounts. Beginning with the suspension of paragraph (a), clause (2), for a 
112.27 	vendor with a liability of $120,000 or more during a fiscal year ending June 30, 2009, 
112.28 	and fiscal years thereafter, the taxes imposed by chapter 297A are due and payable to the 
112.29 	commissioner on the 20th day of the month following the month in which the taxable 
112.30 	event occurred. Payments of tax liabilities for taxable events occurring in June under 
112.31 	paragraph (b) are not changed.

112.32 	EFFECTIVE DATE. This section is effective for taxes due and payable after 
112.33 	June 30, 2012.

112.34 	Sec. 2. Minnesota Statutes 2011 Supplement, section 295.53, subdivision 1, is 
112.35 	amended to read:
113.1 		Subdivision 1.Exemptions. (a) The following payments are excluded from the 
113.2 	gross revenues subject to the hospital, surgical center, or health care provider taxes under 
113.3 	sections 295.50 to 295.59:
113.4 	(1) payments received for services provided under the Medicare program, including 
113.5 	payments received from the government, and organizations governed by sections 1833 
113.6 	and 1876 of title XVIII of the federal Social Security Act, United States Code, title 42, 
113.7 	section 1395, and enrollee deductibles, coinsurance, and co-payments, whether paid by the 
113.8 	Medicare enrollee or by a Medicare supplemental coverage as defined in section 62A.011, 
113.9 	subdivision 3, clause (10), or by Medicaid payments under title XIX of the federal Social 
113.10 	Security Act. Payments for services not covered by Medicare are taxable;
113.11 	(2) payments received for home health care services;
113.12 	(3) payments received from hospitals or surgical centers for goods and services on 
113.13 	which liability for tax is imposed under section 295.52 or the source of funds for the 
113.14 	payment is exempt under clause (1), (7), (10), or (14);
113.15 	(4) payments received from health care providers for goods and services on which 
113.16 	liability for tax is imposed under this chapter or the source of funds for the payment is 
113.17 	exempt under clause (1), (7), (10), or (14);
113.18 	(5) amounts paid for legend drugs, other than nutritional products and blood and 
113.19 	blood components, to a wholesale drug distributor who is subject to tax under section 
113.20 	295.52, subdivision 3, reduced by reimbursements received for legend drugs otherwise 
113.21 	exempt under this chapter;
113.22 	(6) payments received by a health care provider or the wholly owned subsidiary of a 
113.23 	health care provider for care provided outside Minnesota;
113.24 	(7) payments received from the chemical dependency fund under chapter 254B;
113.25 	(8) payments received in the nature of charitable donations that are not designated 
113.26 	for providing patient services to a specific individual or group;
113.27 	(9) payments received for providing patient services incurred through a formal 
113.28 	program of health care research conducted in conformity with federal regulations 
113.29 	governing research on human subjects. Payments received from patients or from other 
113.30 	persons paying on behalf of the patients are subject to tax;
113.31 	(10) payments received from any governmental agency for services benefiting the 
113.32 	public, not including payments made by the government in its capacity as an employer 
113.33 	or insurer or payments made by the government for services provided under general 
113.34 	assistance medical care, the MinnesotaCare program, or the medical assistance program 
113.35 	governed by title XIX of the federal Social Security Act, United States Code, title 42, 
113.36 	sections 1396 to 1396v;
114.1 	(11) government payments received by the commissioner of human services for 
114.2 	state-operated services;
114.3 	(12) payments received by a health care provider for hearing aids and related 
114.4 	equipment or prescription eyewear delivered outside of Minnesota;
114.5 	(13) payments received by an educational institution from student tuition, student 
114.6 	activity fees, health care service fees, government appropriations, donations, or grants, 
114.7 	and for services identified in and provided under an individualized education program 
114.8 	as defined in section 256B.0625 or Code of Federal Regulations, chapter 34, section 
114.9 	300.340(a). Fee for service payments and payments for extended coverage are taxable;
114.10 	(14) payments received under the federal Employees Health Benefits Act, United 
114.11 	States Code, title 5, section 8909(f), as amended by the Omnibus Reconciliation Act of 
114.12 	1990. Enrollee deductibles, coinsurance, and co-payments are subject to tax; and
114.13 	(15) payments received under the federal Tricare program, Code of Federal 
114.14 	Regulations, title 32, section 199.17(a)(7). Enrollee deductibles, coinsurance, and 
114.15 	co-payments are subject to tax.; and
114.16 	(16) payments for laboratory services to examine and report results for a biological 
114.17 	specimen that is collected outside the state. The entity claiming the exemption is required 
114.18 	to keep adequate records demonstrating that the specimen was collected outside the state, 
114.19 	so that the commissioner can ensure that the correct amount of tax is paid.
114.20 	(b) Payments received by wholesale drug distributors for legend drugs sold directly 
114.21 	to veterinarians or veterinary bulk purchasing organizations are excluded from the gross 
114.22 	revenues subject to the wholesale drug distributor tax under sections 295.50 to 295.59.

114.23 	EFFECTIVE DATE. This section is effective for gross revenues received from 
114.24 	laboratory services provided on or after July 1, 2013.

114.25 	Sec. 3. Minnesota Statutes 2010, section 297A.61, subdivision 4, is amended to read:
114.26 		Subd. 4.Retail sale. (a) A "retail sale" means any sale, lease, or rental for any 
114.27 	purpose, other than resale, sublease, or subrent of items by the purchaser in the normal 
114.28 	course of business as defined in subdivision 21.
114.29 	(b) A sale of property used by the owner only by leasing it to others or by holding it 
114.30 	in an effort to lease it, and put to no use by the owner other than resale after the lease or 
114.31 	effort to lease, is a sale of property for resale.
114.32 	(c) A sale of master computer software that is purchased and used to make copies for 
114.33 	sale or lease is a sale of property for resale.
114.34 	(d) A sale of building materials, supplies, and equipment to owners, contractors, 
114.35 	subcontractors, or builders for the erection of buildings or the alteration, repair, or 
115.1 	improvement of real property is a retail sale in whatever quantity sold, whether the sale is 
115.2 	for purposes of resale in the form of real property or otherwise.
115.3 	(e) A sale of carpeting, linoleum, or similar floor covering to a person who provides 
115.4 	for installation of the floor covering is a retail sale and not a sale for resale since a sale 
115.5 	of floor covering which includes installation is a contract for the improvement of real 
115.6 	property.
115.7 	(f) A sale of shrubbery, plants, sod, trees, and similar items to a person who provides 
115.8 	for installation of the items is a retail sale and not a sale for resale since a sale of 
115.9 	shrubbery, plants, sod, trees, and similar items that includes installation is a contract for 
115.10 	the improvement of real property.
115.11 	(g) A sale of tangible personal property that is awarded as prizes is a retail sale and 
115.12 	is not considered a sale of property for resale.
115.13 	(h) A sale of tangible personal property utilized or employed in the furnishing or 
115.14 	providing of services under subdivision 3, paragraph (g), clause (1), including, but not 
115.15 	limited to, property given as promotional items, is a retail sale and is not considered a 
115.16 	sale of property for resale.
115.17 	(i) A sale of tangible personal property used in conducting lawful gambling under 
115.18 	chapter 349 or the State Lottery under chapter 349A, including, but not limited to, 
115.19 	property given as promotional items, is a retail sale and is not considered a sale of 
115.20 	property for resale.
115.21 	(j) A sale of machines, equipment, or devices that are used to furnish, provide, or 
115.22 	dispense goods or services, including, but not limited to, coin-operated devices, is a retail 
115.23 	sale and is not considered a sale of property for resale.
115.24 	(k) In the case of a lease, a retail sale occurs (1) when an obligation to make a lease 
115.25 	payment becomes due under the terms of the agreement or the trade practices of the lessor 
115.26 	or; (2) in the case of a lease of a motor vehicle, as defined in section 297B.01, subdivision 
115.27 	11, but excluding vehicles with a manufacturer's gross vehicle weight rating greater than 
115.28 	10,000 pounds and rentals of vehicles for not more than 28 days, at the time the lease is 
115.29 	executed; or (3) for rent-to-own or lease-to-own used vehicles where the lessee may 
115.30 	purchase or return the vehicle at any time without penalty, at the time each payment is 
115.31 	made under the terms of the agreement.
115.32 	(l) In the case of a conditional sales contract, a retail sale occurs upon the transfer of 
115.33 	title or possession of the tangible personal property.
115.34 	(m) A sale of a bundled transaction in which one or more of the products included 
115.35 	in the bundle is a taxable product is a retail sale, except that if one of the products 
115.36 	is a telecommunication service, ancillary service, Internet access, or audio or video 
116.1 	programming service, and the seller has maintained books and records identifying through 
116.2 	reasonable and verifiable standards the portions of the price that are attributable to the 
116.3 	distinct and separately identifiable products, then the products are not considered part of a 
116.4 	bundled transaction. For purposes of this paragraph:
116.5 	(1) the books and records maintained by the seller must be maintained in the regular 
116.6 	course of business, and do not include books and records created and maintained by the 
116.7 	seller primarily for tax purposes;
116.8 	(2) books and records maintained in the regular course of business include, but are 
116.9 	not limited to, financial statements, general ledgers, invoicing and billing systems and 
116.10 	reports, and reports for regulatory tariffs and other regulatory matters; and
116.11 	(3) books and records are maintained primarily for tax purposes when the books 
116.12 	and records identify taxable and nontaxable portions of the price, but the seller maintains 
116.13 	other books and records that identify different prices attributable to the distinct products 
116.14 	included in the same bundled transaction.

116.15 	EFFECTIVE DATE. This section is effective for leases entered into after June 
116.16 	30, 2012.

116.17 	Sec. 4. Minnesota Statutes 2010, section 297A.68, subdivision 5, is amended to read:
116.18 		Subd. 5.Capital equipment. (a) Capital equipment is exempt. Except as provided 
116.19 	in paragraph (e), the tax must be imposed and collected as if the rate under section 
116.20 	297A.62, subdivision 1, applied, and then refunded in the manner provided in section 
116.21 	297A.75.
116.22 	"Capital equipment" means machinery and equipment purchased or leased, and used 
116.23 	in this state by the purchaser or lessee primarily for manufacturing, fabricating, mining, 
116.24 	or refining tangible personal property to be sold ultimately at retail if the machinery and 
116.25 	equipment are essential to the integrated production process of manufacturing, fabricating, 
116.26 	mining, or refining. Capital equipment also includes machinery and equipment 
116.27 	used primarily to electronically transmit results retrieved by a customer of an online 
116.28 	computerized data retrieval system.
116.29 	(b) Capital equipment includes, but is not limited to:
116.30 	(1) machinery and equipment used to operate, control, or regulate the production 
116.31 	equipment;
116.32 	(2) machinery and equipment used for research and development, design, quality 
116.33 	control, and testing activities;
117.1 	(3) environmental control devices that are used to maintain conditions such as 
117.2 	temperature, humidity, light, or air pressure when those conditions are essential to and are 
117.3 	part of the production process;
117.4 	(4) materials and supplies used to construct and install machinery or equipment;
117.5 	(5) repair and replacement parts, including accessories, whether purchased as spare 
117.6 	parts, repair parts, or as upgrades or modifications to machinery or equipment;
117.7 	(6) materials used for foundations that support machinery or equipment;
117.8 	(7) materials used to construct and install special purpose buildings used in the 
117.9 	production process;
117.10 	(8) ready-mixed concrete equipment in which the ready-mixed concrete is mixed 
117.11 	as part of the delivery process regardless if mounted on a chassis, repair parts for 
117.12 	ready-mixed concrete trucks, and leases of ready-mixed concrete trucks; and
117.13 	(9) machinery or equipment used for research, development, design, or production 
117.14 	of computer software.
117.15 	(c) Capital equipment does not include the following:
117.16 	(1) motor vehicles taxed under chapter 297B;
117.17 	(2) machinery or equipment used to receive or store raw materials;
117.18 	(3) building materials, except for materials included in paragraph (b), clauses (6) 
117.19 	and (7);
117.20 	(4) machinery or equipment used for nonproduction purposes, including, but not 
117.21 	limited to, the following: plant security, fire prevention, first aid, and hospital stations; 
117.22 	support operations or administration; pollution control; and plant cleaning, disposal of 
117.23 	scrap and waste, plant communications, space heating, cooling, lighting, or safety;
117.24 	(5) farm machinery and aquaculture production equipment as defined by section 
117.25 	297A.61, subdivisions 12 and 13;
117.26 	(6) machinery or equipment purchased and installed by a contractor as part of an 
117.27 	improvement to real property;
117.28 	(7) machinery and equipment used by restaurants in the furnishing, preparing, or 
117.29 	serving of prepared foods as defined in section 297A.61, subdivision 31;
117.30 	(8) machinery and equipment used to furnish the services listed in section 297A.61, 
117.31 	subdivision 3, paragraph (g), clause (6), items (i) to (vi) and (viii);
117.32 	(9) machinery or equipment used in the transportation, transmission, or distribution 
117.33 	of petroleum, liquefied gas, natural gas, water, or steam, in, by, or through pipes, lines, 
117.34 	tanks, mains, or other means of transporting those products. This clause does not apply to 
117.35 	machinery or equipment used to blend petroleum or biodiesel fuel as defined in section 
117.36 	239.77; or
118.1 	(10) any other item that is not essential to the integrated process of manufacturing, 
118.2 	fabricating, mining, or refining.
118.3 	(d) For purposes of this subdivision:
118.4 	(1) "Equipment" means independent devices or tools separate from machinery but 
118.5 	essential to an integrated production process, including computers and computer software, 
118.6 	used in operating, controlling, or regulating machinery and equipment; and any subunit or 
118.7 	assembly comprising a component of any machinery or accessory or attachment parts of 
118.8 	machinery, such as tools, dies, jigs, patterns, and molds.
118.9 	(2) "Fabricating" means to make, build, create, produce, or assemble components or 
118.10 	property to work in a new or different manner.
118.11 	(3) "Integrated production process" means a process or series of operations through 
118.12 	which tangible personal property is manufactured, fabricated, mined, or refined. For 
118.13 	purposes of this clause, (i) manufacturing begins with the removal of raw materials 
118.14 	from inventory and ends when the last process prior to loading for shipment has been 
118.15 	completed; (ii) fabricating begins with the removal from storage or inventory of the 
118.16 	property to be assembled, processed, altered, or modified and ends with the creation 
118.17 	or production of the new or changed product; (iii) mining begins with the removal of 
118.18 	overburden from the site of the ores, minerals, stone, peat deposit, or surface materials and 
118.19 	ends when the last process before stockpiling is completed; and (iv) refining begins with 
118.20 	the removal from inventory or storage of a natural resource and ends with the conversion 
118.21 	of the item to its completed form.
118.22 	(4) "Machinery" means mechanical, electronic, or electrical devices, including 
118.23 	computers and computer software, that are purchased or constructed to be used for the 
118.24 	activities set forth in paragraph (a), beginning with the removal of raw materials from 
118.25 	inventory through completion of the product, including packaging of the product.
118.26 	(5) "Machinery and equipment used for pollution control" means machinery and 
118.27 	equipment used solely to eliminate, prevent, or reduce pollution resulting from an activity 
118.28 	described in paragraph (a).
118.29 	(6) "Manufacturing" means an operation or series of operations where raw materials 
118.30 	are changed in form, composition, or condition by machinery and equipment and which 
118.31 	results in the production of a new article of tangible personal property. For purposes of 
118.32 	this subdivision, "manufacturing" includes the generation of electricity or steam to be 
118.33 	sold at retail.
118.34 	(7) "Mining" means the extraction of minerals, ores, stone, or peat.
118.35 	(8) "Online data retrieval system" means a system whose cumulation of information 
118.36 	is equally available and accessible to all its customers.
119.1 	(9) "Primarily" means machinery and equipment used 50 percent or more of the time 
119.2 	in an activity described in paragraph (a).
119.3 	(10) "Refining" means the process of converting a natural resource to an intermediate 
119.4 	or finished product, including the treatment of water to be sold at retail.
119.5 	(11) This subdivision does not apply to telecommunications equipment as 
119.6 	provided in subdivision 35, and does not apply to wire, cable, fiber, poles, or conduit 
119.7 	for telecommunications services.
119.8 	(e) Materials exempt under this section may be purchased without imposing and 
119.9 	collecting the tax and applying for a refund under section 297A.75, provided that:
119.10 	(1) the purchaser employed not more than 50 full-time employees at any time 
119.11 	during the calendar year that is immediately prior to the calendar year of the sale and 
119.12 	purchase; and 
119.13 	(2) if another business owns at least 20 percent of the purchaser, then the sum of the 
119.14 	number of full-time employees employed by the purchaser and the number of full-time 
119.15 	employees employed by any other business that owns at least 20 percent of the purchaser's 
119.16 	business is not more than 50 full-time employees at any time during the calendar year that 
119.17 	is immediately prior to the calendar year of the sale and purchase. This clause must be 
119.18 	applied for each business that owns at least 20 percent of the purchaser.

119.19 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
119.20 	June 30, 2012.

119.21 	Sec. 5. Minnesota Statutes 2011 Supplement, section 297A.68, subdivision 42, is 
119.22 	amended to read:
119.23 		Subd. 42.Qualified data centers. (a) Purchases of enterprise information 
119.24 	technology equipment and computer software for use in a qualified data center are exempt. 
119.25 	The tax on purchases exempt under this paragraph must be imposed and collected as if 
119.26 	the rate under section 297A.62, subdivision 1, applied, and then refunded after June 30, 
119.27 	2013, in the manner provided in section 297A.75. This exemption includes enterprise 
119.28 	information technology equipment and computer software purchased to replace or upgrade 
119.29 	enterprise information technology equipment and computer software in a qualified data 
119.30 	center.
119.31 	(b) Electricity used or consumed in the operation of a qualified data center is exempt.
119.32 	(c) For purposes of this subdivision, "qualified data center" means a facility in 
119.33 	Minnesota:
119.34 	(1) that is comprised of one or more buildings that consist in the aggregate of 
119.35 	at least 30,000 square feet, and that are located on a single parcel or on contiguous 
120.1 	parcels, where the total cost of construction or refurbishment, investment in enterprise 
120.2 	information technology equipment, and computer software is at least $50,000,000 within 
120.3 	a 24-month period;
120.4 	(2) that is constructed or substantially refurbished after June 30, 2012, where 
120.5 	"substantially refurbished" means that at least 30,000 25,000 square feet have been rebuilt 
120.6 	or modified; and, including:
120.7 	(i) installation of enterprise information technology equipment, computer software, 
120.8 	environmental control and energy efficiency improvements; and
120.9 	(ii) building improvements; and
120.10 	(3) that is used to house enterprise information technology equipment, where the 
120.11 	facility has the following characteristics:
120.12 	(i) uninterruptible power supplies, generator backup power, or both;
120.13 	(ii) sophisticated fire suppression and prevention systems; and
120.14 	(iii) enhanced security. A facility will be considered to have enhanced security if it 
120.15 	has restricted access to the facility to selected personnel; permanent security guards; video 
120.16 	camera surveillance; an electronic system requiring pass codes, keycards, or biometric 
120.17 	scans, such as hand scans and retinal or fingerprint recognition; or similar security features.
120.18 	In determining whether the facility has the required square footage, the square 
120.19 	footage of the following spaces shall be included if the spaces support the operation 
120.20 	of enterprise information technology equipment: office space, meeting space, and 
120.21 	mechanical and other support facilities. For purposes of this subdivision, "computer 
120.22 	software" includes, but is not limited to, software utilized or loaded at the qualified data 
120.23 	center, including maintenance, licensing, and software customization.
120.24 	(d) For purposes of this subdivision, "enterprise information technology equipment" 
120.25 	means computers and equipment supporting computing, networking, or data storage, 
120.26 	including servers and routers. It includes, but is not limited to: cooling systems, 
120.27 	cooling towers, and other temperature control infrastructure; power infrastructure for 
120.28 	transformation, distribution, or management of electricity used for the maintenance 
120.29 	and operation of a qualified data center, including but not limited to exterior dedicated 
120.30 	business-owned substations, backup power generation systems, battery systems, and 
120.31 	related infrastructure; and racking systems, cabling, and trays, which are necessary for 
120.32 	the maintenance and operation of the qualified data center.
120.33 	(e) A qualified data center may claim the exemptions in this subdivision for 
120.34 	purchases made either within 20 years of the date of its first purchase qualifying for the 
120.35 	exemption under paragraph (a), or by June 30, 2042, whichever is earlier.
121.1 	(f) The purpose of this exemption is to create jobs in the construction and data 
121.2 	center industries.
121.3 	(g) This subdivision is effective for sales and purchases made after June 30, 2012, 
121.4 	and before July 1, 2042.

121.5 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
121.6 	June 30, 2012.

121.7 	Sec. 6. Minnesota Statutes 2010, section 297A.70, subdivision 4, is amended to read:
121.8 		Subd. 4.Sales to nonprofit groups. (a) All sales, except those listed in paragraph 
121.9 	(b), to the following "nonprofit organizations" are exempt:
121.10 	(1) a corporation, society, association, foundation, or institution organized and 
121.11 	operated exclusively for charitable, religious, or educational purposes if the item 
121.12 	purchased is used in the performance of charitable, religious, or educational functions; and
121.13 	(2) any senior citizen group or association of groups that:
121.14 	(i) in general limits membership to persons who are either age 55 or older, or 
121.15 	physically disabled;
121.16 	(ii) is organized and operated exclusively for pleasure, recreation, and other 
121.17 	nonprofit purposes, not including housing, no part of the net earnings of which inures to 
121.18 	the benefit of any private shareholders; and
121.19 	(iii) is an exempt organization under section 501(c) of the Internal Revenue Code.
121.20 	For purposes of this subdivision, charitable purpose includes the maintenance of a 
121.21 	cemetery owned by a religious organization.
121.22 	(b) This exemption does not apply to the following sales:
121.23 	(1) building, construction, or reconstruction materials purchased by a contractor 
121.24 	or a subcontractor as a part of a lump-sum contract or similar type of contract with a 
121.25 	guaranteed maximum price covering both labor and materials for use in the construction, 
121.26 	alteration, or repair of a building or facility;
121.27 	(2) construction materials purchased by tax-exempt entities or their contractors to 
121.28 	be used in constructing buildings or facilities that will not be used principally by the 
121.29 	tax-exempt entities; and
121.30 	(3) lodging as defined under section 297A.61, subdivision 3, paragraph (g), clause 
121.31 	(2), and prepared food, candy, soft drinks, and alcoholic beverages as defined in section 
121.32 	297A.67, subdivision 2, except wine purchased by an established religious organization 
121.33 	for sacramental purposes or as allowed under subdivision 9a; and
122.1 	(4) leasing of a motor vehicle as defined in section 297B.01, subdivision 11, except 
122.2 	as provided in paragraph (c).
122.3 	(c) This exemption applies to the leasing of a motor vehicle as defined in section 
122.4 	297B.01, subdivision 11, only if the vehicle is:
122.5 	(1) a truck, as defined in section 168.002, a bus, as defined in section 168.002, or a 
122.6 	passenger automobile, as defined in section 168.002, if the automobile is designed and 
122.7 	used for carrying more than nine persons including the driver; and
122.8 	(2) intended to be used primarily to transport tangible personal property or 
122.9 	individuals, other than employees, to whom the organization provides service in 
122.10 	performing its charitable, religious, or educational purpose.
122.11 	(d) A limited liability company also qualifies for exemption under this subdivision if 
122.12 	(1) it consists of a sole member that would qualify for the exemption, and (2) the items 
122.13 	purchased qualify for the exemption.

122.14 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
122.15 	June 30, 2012.

122.16 	Sec. 7. Minnesota Statutes 2010, section 297A.70, is amended by adding a subdivision 
122.17 	to read:
122.18 		Subd. 9a.Established religious orders. (a) Sales of lodging, prepared food, candy, 
122.19 	soft drinks, and alcoholic beverages at noncatered events between an established religious 
122.20 	order and an affiliated institution of higher education are exempt.
122.21 	(b) For purposes of this subdivision, "established religious order" means an 
122.22 	organization directly or indirectly under the control or supervision of a church or 
122.23 	convention or association of churches, where members of the organization (1) normally 
122.24 	live together as part of a community, (2) make long-term commitments to live under a 
122.25 	strict set of moral and spiritual rules, and (3) work or engage full time in a combination 
122.26 	of prayer, religious study, church reform or renewal, or other religious, educational, or 
122.27 	charitable goals of the organization.
122.28 	(c) For purposes of this subdivision, an institution of higher education is "affiliated" 
122.29 	with an established religious order if members of the religious order are represented 
122.30 	on the governing board of the institution of higher education and the two organization 
122.31 	share campus space and common facilities.

122.32 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
122.33 	June 30, 2012.

123.1 	Sec. 8. Minnesota Statutes 2010, section 297A.70, is amended by adding a subdivision 
123.2 	to read:
123.3 		Subd. 18.Nursing homes and boarding care homes. (a) All sales, except those 
123.4 	listed in paragraph (b), to a nursing home licensed under section 144A.02 or a boarding 
123.5 	care home certified as a nursing facility under title 19 of the Social Security Act are 
123.6 	exempt if the facility:
123.7 	(1) is exempt from federal income taxation pursuant to section 501(c)(3) of the 
123.8 	Internal Revenue Code; and
123.9 	(2) is certified to participate in the medical assistance program under title 19 of the 
123.10 	Social Security Act, or certifies to the commissioner that it does not discharge residents 
123.11 	due to the inability to pay.
123.12 	(b) This exemption does not apply to the following sales:
123.13 	(1) building, construction, or reconstruction materials purchased by a contractor 
123.14 	or a subcontractor as a part of a lump-sum contract or similar type of contract with a 
123.15 	guaranteed maximum price covering both labor and materials for use in the construction, 
123.16 	alteration, or repair of a building or facility;
123.17 	(2) construction materials purchased by tax-exempt entities or their contractors to 
123.18 	be used in constructing buildings or facilities that will not be used principally by the 
123.19 	tax-exempt entities;
123.20 	(3) lodging as defined under section 297A.61, subdivision 3, paragraph (g), clause 
123.21 	(2), and prepared food, candy, soft drinks, and alcoholic beverages as defined in section 
123.22 	297A.67, subdivision 2; and
123.23 	(4) leasing of a motor vehicle as defined in section 297B.01, subdivision 11, except 
123.24 	as provided in paragraph (c).
123.25 	(c) This exemption applies to the leasing of a motor vehicle as defined in section 
123.26 	297B.01, subdivision 11, only if the vehicle is:
123.27 	(1) a truck, as defined in section 168.002; a bus, as defined in section 168.002; or a 
123.28 	passenger automobile, as defined in section 168.002, if the automobile is designed and 
123.29 	used for carrying more than nine persons including the driver; and
123.30 	(2) intended to be used primarily to transport tangible personal property or residents 
123.31 	of the nursing home or boarding care home.

123.32 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
123.33 	June 30, 2012.

123.34 	Sec. 9. Minnesota Statutes 2010, section 297A.815, subdivision 3, is amended to read:
124.1 		Subd. 3.Motor vehicle lease sales tax revenue. (a) For purposes of this 
124.2 	subdivision, "net revenue" means an amount equal to:
124.3 	(1) the revenues, including interest and penalties, collected under this section and 
124.4 	on the leases under section 297A.61, subdivision 4, paragraph (k), clause (3), during 
124.5 	the fiscal year; less
124.6 	(2) in fiscal year 2011, $30,100,000; in fiscal year 2012, $31,100,000; and in fiscal 
124.7 	year 2013 and following fiscal years, $32,000,000.
124.8 	(b) On or before June 30 of each fiscal year, the commissioner of revenue shall 
124.9 	estimate the amount of the revenues and subtraction under paragraph (a) for the current 
124.10 	fiscal year.
124.11 	(c) On or after July 1 of the subsequent fiscal year, the commissioner of management 
124.12 	and budget shall transfer the net revenue as estimated in paragraph (b) from the general 
124.13 	fund, as follows:
124.14 	(1) 50 percent to the greater Minnesota transit account; and
124.15 	(2) 50 percent to the county state-aid highway fund. Notwithstanding any other law 
124.16 	to the contrary, the commissioner of transportation shall allocate the funds transferred 
124.17 	under this clause to the counties in the metropolitan area, as defined in section 473.121, 
124.18 	subdivision 4, excluding the counties of Hennepin and Ramsey, so that each county shall 
124.19 	receive of such amount the percentage that its population, as defined in section 477A.011, 
124.20 	subdivision 3, estimated or established by July 15 of the year prior to the current calendar 
124.21 	year, bears to the total population of the counties receiving funds under this clause.
124.22 	(d) For fiscal years 2010 and 2011, the amount under paragraph (a), clause (1), must 
124.23 	be calculated using the following percentages of the total revenues:
124.24 	(1) for fiscal year 2010, 83.75 percent; and
124.25 	(2) for fiscal year 2011, 93.75 percent.

124.26 	EFFECTIVE DATE. This section is effective for leases entered into after June 
124.27 	30, 2012.

124.28 	Sec. 10. Minnesota Statutes 2010, section 297A.8155, is amended to read:
124.29 	297A.8155 LIQUOR REPORTING REQUIREMENTS; PENALTY.
124.30 	A person who sells liquor, as defined in section 295.75, subdivision 1, in Minnesota 
124.31 	to a retailer that sells liquor, shall file with the commissioner an annual informational 
124.32 	report, in the form and manner prescribed by the commissioner, indicating the name, 
124.33 	address, and Minnesota business identification number of each retailer, and the total 
124.34 	dollar amount of liquor sold to each retailer in the previous calendar year. The report 
125.1 	must be filed on or before March 31 following the close of the calendar year. A person 
125.2 	failing to file this report is subject to the penalty imposed under section 289A.60. A 
125.3 	person required to file a report under this section is not required to provide a copy of an 
125.4 	exemption certificate, as defined in section 297A.72, provided to the person by a retailer, 
125.5 	along with the annual informational report.

125.6 	EFFECTIVE DATE. This section is effective for reports required to be filed 
125.7 	beginning in calendar year 2012 and thereafter.

125.8 	Sec. 11. Laws 1998, chapter 389, article 8, section 43, subdivision 3, as amended by 
125.9 	Laws 2005, First Special Session chapter 3, article 5, section 28, and Laws 2011, First 
125.10 	Special Session chapter 7, article 4, section 5, is amended to read:
125.11 		Subd. 3.Use of revenues. (a) Revenues received from the taxes authorized by 
125.12 	subdivisions 1 and 2 must be used by the city to pay for the cost of collecting and 
125.13 	administering the taxes and to pay for the following projects:
125.14 	(1) transportation infrastructure improvements including regional highway and 
125.15 	airport improvements;
125.16 	(2) improvements to the civic center complex;
125.17 	(3) a municipal water, sewer, and storm sewer project necessary to improve regional 
125.18 	ground water quality; and
125.19 	(4) construction of a regional recreation and sports center and other higher education 
125.20 	facilities available for both community and student use.
125.21 	(b) The total amount of capital expenditures or bonds for projects listed in paragraph 
125.22 	(a) that may be paid from the revenues raised from the taxes authorized in this section 
125.23 	may not exceed $111,500,000. The total amount of capital expenditures or bonds for the 
125.24 	project in clause (4) that may be paid from the revenues raised from the taxes authorized 
125.25 	in this section may not exceed $28,000,000.
125.26 	(c) In addition to the projects authorized in paragraph (a) and not subject to the 
125.27 	amount stated in paragraph (b), the city of Rochester may, if approved by the voters at an 
125.28 	election under subdivision 5, paragraph (c), use the revenues received from the taxes and 
125.29 	bonds authorized in this section to pay the costs of or bonds for the following purposes:
125.30 	(1) $17,000,000 for capital expenditures and bonds for the following Olmsted 
125.31 	County transportation infrastructure improvements:
125.32 	(i) County State Aid Highway 34 reconstruction;
125.33 	(ii) Trunk Highway 63 and County State Aid Highway 16 interchange; 
125.34 	(iii) phase II of the Trunk Highway 52 and County State Aid Highway 22 
125.35 	interchange;
126.1 	(iv) widening of County State Aid Highway 22 West Circle Drive; and 
126.2 	(v) 60th Avenue Northwest corridor preservation;
126.3 	(2) $30,000,000 for city transportation projects including:
126.4 	(i) Trunk Highway 52 and 65th Street interchange;
126.5 	(ii) NW transportation corridor acquisition; 
126.6 	(iii) Phase I of the Trunk Highway 52 and County State Aid Highway 22 interchange;
126.7 	(iv) Trunk Highway 14 and Trunk Highway 63 intersection;
126.8 	(v) Southeast transportation corridor acquisition;
126.9 	(vi) Rochester International Airport expansion; and 
126.10 	(vii) a transit operations center bus facility;
126.11 	(3) $14,000,000 for the University of Minnesota Rochester academic and 
126.12 	complementary facilities;
126.13 	(4) $6,500,000 for the Rochester Community and Technical College/Winona State 
126.14 	University career technical education and science and math facilities;
126.15 	(5) $6,000,000 for the Rochester Community and Technical College regional 
126.16 	recreation facilities at University Center Rochester;
126.17 	(6) $20,000,000 for the Destination Medical Community Initiative;
126.18 	(7) $8,000,000 for the regional public safety and 911 dispatch center facilities;
126.19 	(8) $20,000,000 for a regional recreation/senior center;
126.20 	(9) $10,000,000 for an economic development fund; and
126.21 	(10) $8,000,000 for downtown infrastructure.
126.22 	(d) No revenues from the taxes raised from the taxes authorized in subdivisions 1 
126.23 	and 2 may be used to fund transportation improvements related to a railroad bypass that 
126.24 	would divert traffic from the city of Rochester.
126.25 	(e) The city shall use $5,000,000 of the money allocated to the purpose in paragraph 
126.26 	(c), clause (9), for grants to the cities of Byron, Chatfield, Dodge Center, Dover, Elgin, 
126.27 	Eyota, Kasson, Mantorville, Oronoco, Pine Island, Plainview, St. Charles, Stewartville, 
126.28 	Zumbrota, Spring Valley, West Concord, and Hayfield, and any other city with a 2010 
126.29 	population of at least 1,000 that has a city boundary within 25 miles of the geographic 
126.30 	center of Rochester and is closer to Rochester than to any other city located wholly 
126.31 	outside of the seven-county metropolitan area with a population of 20,000 or more,
126.32 	for economic development projects that these communities would fund through their 
126.33 	economic development authority or housing and redevelopment authority.

126.34 	EFFECTIVE DATE. This section is effective the day following final enactment.

127.1 	Sec. 12. Laws 2002, chapter 377, article 3, section 25, as amended by Laws 2009, 
127.2 	chapter 88, article 4, section 19, and Laws 2010, chapter 389, article 5, section 3, is 
127.3 	amended to read:
127.4 	Sec. 25. ROCHESTER LODGING TAX.
 127.5 		Subdivision 1.Authorization. Notwithstanding Minnesota Statutes, section 
127.6 	469.190 or 477A.016, or any other law, the city of Rochester may impose an additional 
127.7 	tax of one percent on the gross receipts from the furnishing for consideration of lodging at 
127.8 	a hotel, motel, rooming house, tourist court, or resort, other than the renting or leasing of it 
127.9 	for a continuous period of 30 days or more.
127.10 		Subd. 1a.Authorization. Notwithstanding Minnesota Statutes, section 469.190
127.11 	or 477A.016, or any other law, and in addition to the tax authorized by subdivision 1, 
127.12 	the city of Rochester may impose an additional tax of one three percent on the gross 
127.13 	receipts from the furnishing for consideration of lodging at a hotel, motel, rooming house, 
127.14 	tourist court, or resort, other than the renting or leasing of it for a continuous period of 
127.15 	30 days or more only upon the approval of the city governing body of a total financial 
127.16 	package for the project.
127.17 		Subd. 2.Disposition of proceeds. (a) The gross proceeds from the tax imposed 
127.18 	under subdivision 1 must be used by the city to fund a local convention or tourism bureau 
127.19 	for the purpose of marketing and promoting the city as a tourist or convention center.
127.20 	(b) The gross proceeds from the one three percent tax imposed under subdivision 
127.21 	1a shall be used to pay for (1) construction, renovation, improvement, and expansion of 
127.22 	the Mayo Civic Center and related skyway access, lighting, parking, or landscaping; and 
127.23 	(2) for payment of any principal, interest, or premium on bonds issued to finance the 
127.24 	construction, renovation, improvement, and expansion of the Mayo Civic Center Complex.
127.25 		Subd. 2a.Bonds. The city of Rochester may issue, without an election, general 
127.26 	obligation bonds of the city, in one or more series, in the aggregate principal amount 
127.27 	not to exceed $43,500,000, to pay for capital and administrative costs for the design, 
127.28 	construction, renovation, improvement, and expansion of the Mayo Civic Center Complex, 
127.29 	and related skyway, access, lighting, parking, and landscaping. The city may pledge 
127.30 	the lodging tax authorized by subdivision 1a and the food and beverage tax authorized 
127.31 	under Laws 2009, chapter 88, article 4, section 23, to the payment of the bonds. The debt 
127.32 	represented by the bonds is not included in computing any debt limitations applicable to 
127.33 	the city, and the levy of taxes required by Minnesota Statutes, section 475.61, to pay the 
127.34 	principal of and interest on the bonds is not subject to any levy limitation or included in 
127.35 	computing or applying any levy limitation applicable to the city.
128.1 		Subd. 3.Expiration of taxing authority. The authority of the city to impose a 
128.2 	tax under subdivision 1a shall expire when the principal and interest on any bonds or 
128.3 	other obligations issued prior to December 31, 2014 2016, to finance the construction, 
128.4 	renovation, improvement, and expansion of the Mayo Civic Center Complex and related 
128.5 	skyway access, lighting, parking, or landscaping have been paid, including any bonds 
128.6 	issued to refund such bonds, or at an earlier time as the city shall, by ordinance, determine. 
128.7 	Any funds remaining after completion of the project and retirement or redemption of the 
128.8 	bonds shall be placed in the general fund of the city.

128.9 	EFFECTIVE DATE. This section is effective the day after the governing body of 
128.10 	the city of Rochester and its chief clerical officer comply with Minnesota Statutes, section 
128.11 	645.021, subdivisions 2 and 3.

128.12 	Sec. 13. Laws 2005, First Special Session chapter 3, article 5, section 37, subdivision 
128.13 	2, is amended to read:
128.14 		Subd. 2.Use of revenues. (a) Revenues received from the tax authorized by 
128.15 	subdivision 1 by the city of St. Cloud must be used for the cost of collecting and 
128.16 	administering the tax and to pay all or part of the capital or administrative costs of the 
128.17 	development, acquisition, construction, improvement, and securing and paying debt 
128.18 	service on bonds or other obligations issued to finance the following regional projects as 
128.19 	approved by the voters and specifically detailed in the referendum authorizing the tax or 
128.20 	extending the tax:
128.21 	(1) St. Cloud Regional Airport;
128.22 	(2) regional transportation improvements;
128.23 	(3) regional community and aquatics centers and facilities;
128.24 	(4) regional public libraries; and 
128.25 	(5) acquisition and improvement of regional park land and open space.
128.26 	(b) Revenues received from the tax authorized by subdivision 1 by the cities of St. 
128.27 	Joseph, Waite Park, Sartell, Sauk Rapids, and St. Augusta must be used for the cost of 
128.28 	collecting and administering the tax and to pay all or part of the capital or administrative 
128.29 	costs of the development, acquisition, construction, improvement, and securing and paying 
128.30 	debt service on bonds or other obligations issued to fund the projects specifically approved 
128.31 	by the voters at the referendum authorizing the tax or extending the tax. The portion of 
128.32 	revenues from the city going to fund the regional airport or regional library located in the 
128.33 	city of St. Cloud will be as required under the applicable joint powers agreement.
129.1 	(c) The use of revenues received from the taxes authorized in subdivision 1 for 
129.2 	projects allowed under paragraphs (a) and (b) are limited to the amount authorized for 
129.3 	each project under the enabling referendum.

129.4 	EFFECTIVE DATE. This section is effective for the city that approves them the 
129.5 	day after compliance by the governing body of each city with Minnesota Statutes, section 
129.6 	645.021, subdivision 3.

129.7 	Sec. 14. Laws 2005, First Special Session chapter 3, article 5, section 37, subdivision 
129.8 	4, is amended to read:
129.9 		Subd. 4.Termination of tax. The tax imposed in the cities of St. Joseph, St. Cloud, 
129.10 	St. Augusta, Sartell, Sauk Rapids, and Waite Park under subdivision 1 expires when the 
129.11 	city council determines that sufficient funds have been collected from the tax to retire or 
129.12 	redeem the bonds and obligations authorized under subdivision 2, paragraph (a), but no 
129.13 	later than December 31, 2018. Notwithstanding Minnesota Statutes, section 297A.99, 
129.14 	subdivision 3, paragraphs (a), (c), and (d), a city may extend the tax imposed under 
129.15 	subdivision 1 through December 31, 2038, if approved under the referendum authorizing 
129.16 	the tax under subdivision 1 or if approved by voters of the city at a general election held 
129.17 	no later than November 6, 2017.

129.18 	EFFECTIVE DATE. This section is effective for the city that approves them the 
129.19 	day after compliance by the governing body of each city with Minnesota Statutes, section 
129.20 	645.021, subdivision 3.

129.21 	Sec. 15. Laws 2008, chapter 366, article 7, section 19, subdivision 3, as amended by 
129.22 	Laws 2011, First Special Session chapter 7, article 4, section 8, is amended to read:
129.23 		Subd. 3.Use of revenues. Notwithstanding Minnesota Statutes, section 297A.99, 
129.24 	subdivision 3, paragraph (b), the proceeds of the tax imposed under this section shall be 
129.25 	used to pay for the costs of improvements to the Sportsman Park/Ballfields, Riverside 
129.26 	Park, Lions Park/Pavilion, Cedar South Park also known as Eldorado Park, and Spring 
129.27 	Street Park; improvements to and extension of the River County bike trail; acquisition,
129.28 	and construction, improvement, and development of regional parks, bicycle trails, park 
129.29 	land, open space, andof a pedestrian walkways, as described in the city improvement plan 
129.30 	adopted by the city council by resolution on December 12, 2006, and walkway over 
129.31 	Interstate 94 and State Highway 24; and the acquisition of land and construction of 
129.32 	buildings for a community and recreation center. The total amount of revenues from the 
130.1 	taxes in subdivisions 1 and 2 that may be used to fund these projects is $12,000,000 
130.2 	plus any associated bond costs.

130.3 	EFFECTIVE DATE. This section is effective the day after compliance by the 
130.4 	governing body of the city of Clearwater with Minnesota Statutes, section 645.021, 
130.5 	subdivisions 2 and 3.

130.6 	Sec. 16. LIQUOR REPORTING REQUIREMENTS.
 130.7 	A person who was required to submit an annual informational report under 
130.8 	Minnesota Statutes, section 297A.8155, to the commissioner of revenue during calendar 
130.9 	year 2010 or 2011 is not required to provide a copy of an exemption certificate or a 
130.10 	retailer's tax identification number along with the informational report.

130.11 	EFFECTIVE DATE. This section is effective the day following final enactment 
130.12 	and applies to reports required to be filed in calendar year 2010 or 2011.

130.13 	Sec. 17.  REPEALER.
 130.14 	(a) Minnesota Statutes 2011 Supplement, section 289A.60, subdivision 31, is 
130.15 	repealed. 
130.16 	(b) Laws 2009, chapter 88, article 4, section 23, as amended by Laws 2010, chapter 
130.17 	389, article 5, section 4, is repealed.

130.18 	EFFECTIVE DATE. Paragraph (a) is effective for taxes due and payable after June 
130.19 	30, 2012. Paragraph (b) is effective the day following final enactment.

130.20 	ARTICLE 10
130.21 	LOCAL DEVELOPMENT

130.22 	Section 1. Minnesota Statutes 2010, section 469.174, subdivision 2, is amended to read:
130.23 		Subd. 2.Authority. "Authority" means a rural development financing authority 
130.24 	created pursuant to sections 469.142 to 469.151; a housing and redevelopment authority 
130.25 	created pursuant to sections 469.001 to 469.047; a port authority created pursuant to 
130.26 	sections 469.048 to 469.068; an economic development authority created pursuant to 
130.27 	sections 469.090 to 469.108; a redevelopment agency as defined in sections 469.152 to 
130.28 	469.165; a municipality that is administering a development district created pursuant to 
130.29 	sections 469.124 to 469.134 or any special law; a municipality that undertakes a project 
130.30 	pursuant to sections 469.152 to 469.165, except a town located outside the metropolitan 
130.31 	area or with a population of 5,000 persons or less; a municipality that undertakes a project 
131.1 	located in an area designated under subdivision 30; or a municipality that exercises the 
131.2 	powers of a port authority pursuant to any general or special law.

131.3 	EFFECTIVE DATE. This section is effective the day following final enactment.

131.4 	Sec. 2. Minnesota Statutes 2010, section 469.174, subdivision 10, is amended to read:
131.5 		Subd. 10.Redevelopment district. (a) "Redevelopment district" means a type of 
131.6 	tax increment financing district consisting of a project, or portions of a project, within 
131.7 	which the authority finds by resolution that one or more of the following conditions, 
131.8 	reasonably distributed throughout the district, exists:
131.9 	(1) parcels consisting of 70 percent of the area of the district are occupied by 
131.10 	buildings, streets, utilities, paved or gravel parking lots, or other similar structures and 
131.11 	more than 50 percent or more of the buildings, not including outbuildings, are structurally 
131.12 	substandard to a degree requiring substantial renovation or clearance;
131.13 	(2) the property consists of vacant, unused, underused, inappropriately used, or 
131.14 	infrequently used rail yards, rail storage facilities, or excessive or vacated railroad 
131.15 	rights-of-way;
131.16 	(3) tank facilities, or property whose immediately previous use was for tank 
131.17 	facilities, as defined in section 115C.02, subdivision 15, if the tank facilities:
131.18 	(i) have or had a capacity of more than 1,000,000 gallons;
131.19 	(ii) are located adjacent to rail facilities; and
131.20 	(iii) have been removed or are unused, underused, inappropriately used, or 
131.21 	infrequently used; or
131.22 	(4) a qualifying disaster area, as defined in subdivision 10b.
131.23 	(b) For purposes of this subdivision, "structurally substandard" shall mean 
131.24 	containing defects in structural elements or a combination of deficiencies in essential 
131.25 	utilities and facilities, light and ventilation, fire protection including adequate egress, 
131.26 	layout and condition of interior partitions, or similar factors, which defects or deficiencies 
131.27 	are of sufficient total significance to justify substantial renovation or clearance.
131.28 	(c) A building is not structurally substandard if it is in compliance with the building 
131.29 	code applicable to new buildings or could be modified to satisfy the building code at 
131.30 	a cost of less than 15 percent of the cost of constructing a new structure of the same 
131.31 	square footage and type on the site. The municipality may find that a building is not 
131.32 	disqualified as structurally substandard under the preceding sentence on the basis of 
131.33 	reasonably available evidence, such as the size, type, and age of the building, the average 
131.34 	cost of plumbing, electrical, or structural repairs, or other similar reliable evidence. The 
131.35 	municipality may not make such a determination without an interior inspection of the 
132.1 	property, but need not have an independent, expert appraisal prepared of the cost of repair 
132.2 	and rehabilitation of the building. An interior inspection of the property is not required, 
132.3 	if the municipality finds that (1) the municipality or authority is unable to gain access to 
132.4 	the property after using its best efforts to obtain permission from the party that owns or 
132.5 	controls the property; and (2) the evidence otherwise supports a reasonable conclusion that 
132.6 	the building is structurally substandard. Items of evidence that support such a conclusion 
132.7 	include recent fire or police inspections, on-site property tax appraisals or housing 
132.8 	inspections, exterior evidence of deterioration, or other similar reliable evidence. Written 
132.9 	documentation of the findings and reasons why an interior inspection was not conducted 
132.10 	must be made and retained under section 469.175, subdivision 3, clause (1). Failure of a 
132.11 	building to be disqualified under the provisions of this paragraph is a necessary, but not a 
132.12 	sufficient, condition to determining that the building is substandard.
132.13 	(d) A parcel is deemed to be occupied by a structurally substandard building 
132.14 	for purposes of the finding under paragraph (a) or by the improvements described in 
132.15 	paragraph (e) if all of the following conditions are met:
132.16 	(1) the parcel was occupied by a substandard building or met the requirements 
132.17 	of paragraph (e), as the case may be, within three years of the filing of the request for 
132.18 	certification of the parcel as part of the district with the county auditor;
132.19 	(2) the substandard building or the improvements described in paragraph (e) were 
132.20 	demolished or removed by the authority or the demolition or removal was financed by the 
132.21 	authority or was done by a developer under a development agreement with the authority;
132.22 	(3) the authority found by resolution before the demolition or removal that the 
132.23 	parcel was occupied by a structurally substandard building or met the requirements of 
132.24 	paragraph (e) and that after demolition and clearance the authority intended to include 
132.25 	the parcel within a district; and
132.26 	(4) upon filing the request for certification of the tax capacity of the parcel as part 
132.27 	of a district, the authority notifies the county auditor that the original tax capacity of the 
132.28 	parcel must be adjusted as provided by section 469.177, subdivision 1, paragraph (f).
132.29 	(e) For purposes of this subdivision, a parcel is not occupied by buildings, streets, 
132.30 	utilities, paved or gravel parking lots, or other similar structures unless 15 percent of the 
132.31 	area of the parcel contains buildings, streets, utilities, paved or gravel parking lots, or 
132.32 	other similar structures.
132.33 	(f) For districts consisting of two or more noncontiguous areas, each area must 
132.34 	qualify as a redevelopment district under paragraph (a) to be included in the district, and 
132.35 	the entire area of the district must satisfy paragraph (a).

132.36 	EFFECTIVE DATE. This section is effective the day following final enactment.

133.1 	Sec. 3. Minnesota Statutes 2010, section 469.174, is amended by adding a subdivision 
133.2 	to read:
133.3 		Subd. 19a.Soil deficiency district. "Soil deficiency district" means a type of tax 
133.4 	increment financing district consisting of a project, or portions of a project, within which 
133.5 	the authority finds by resolution that the following conditions exist:
133.6 	(1) parcels consisting of 70 percent of the area of the district contain unusual terrain 
133.7 	or soil deficiencies which require substantial filling, grading, or other physical preparation 
133.8 	for use and a parcel is eligible for inclusion if at least 50 percent of the area of the parcel 
133.9 	requires substantial filling, grading, or other physical preparation for use; and
133.10 	(2) the estimated cost of the physical preparation under clause (1), but excluding 
133.11 	costs directly related to roads as defined in section 160.01, and local improvements as 
133.12 	described in sections 429.021, subdivision 1, clauses (1) to (7), (11), and (12), and 430.01, 
133.13 	exceeds the fair market value of the land before completion of the preparation.

133.14 	EFFECTIVE DATE. This section is effective for districts for which the request for 
133.15 	certification is made after April 30, 2012.

133.16 	Sec. 4. Minnesota Statutes 2010, section 469.174, is amended by adding a subdivision 
133.17 	to read:
133.18 		Subd. 30.Mining reclamation project area. (a) An authority may designate an 
133.19 	area within its jurisdiction as a mining reclamation project area by finding by resolution, 
133.20 	that parcels consisting of at least 70 percent of the acreage, excluding street and railroad 
133.21 	rights-of-way, are characterized by one or more of the following conditions:
133.22 	(1) peat or other soils with geotechnical deficiencies that impair development of 
133.23 	buildings or infrastructure;
133.24 	(2) soils or terrain that requires substantial filling in order to permit the development 
133.25 	of buildings or infrastructure;
133.26 	(3) landfills, dumps, or similar deposits of municipal or private waste;
133.27 	(4) quarries or similar resource extraction sites;
133.28 	(5) floodway; and
133.29 	(6) substandard buildings, within the meaning of section 469.174, subdivision 10.
133.30 	(b) For the purposes of paragraph (a), clauses (1) to (5), a parcel is characterized by 
133.31 	the relevant condition if at least 50 percent of the area of the parcel contains the relevant 
133.32 	condition. For the purposes of paragraph (a), clause (6), a parcel is characterized by 
133.33 	substandard buildings if substandard buildings occupy at least 30 percent of the area 
133.34 	of the parcel.

134.1 	EFFECTIVE DATE. This section is effective for districts for which the request for 
134.2 	certification is made after April 30, 2012.

134.3 	Sec. 5. Minnesota Statutes 2010, section 469.175, subdivision 3, is amended to read:
134.4 		Subd. 3.Municipality approval. (a) A county auditor shall not certify the original 
134.5 	net tax capacity of a tax increment financing district until the tax increment financing plan 
134.6 	proposed for that district has been approved by the municipality in which the district 
134.7 	is located. If an authority that proposes to establish a tax increment financing district 
134.8 	and the municipality are not the same, the authority shall apply to the municipality in 
134.9 	which the district is proposed to be located and shall obtain the approval of its tax 
134.10 	increment financing plan by the municipality before the authority may use tax increment 
134.11 	financing. The municipality shall approve the tax increment financing plan only after a 
134.12 	public hearing thereon after published notice in a newspaper of general circulation in the 
134.13 	municipality at least once not less than ten days nor more than 30 days prior to the date 
134.14 	of the hearing. The published notice must include a map of the area of the district from 
134.15 	which increments may be collected and, if the project area includes additional area, a map 
134.16 	of the project area in which the increments may be expended. The hearing may be held 
134.17 	before or after the approval or creation of the project or it may be held in conjunction with 
134.18 	a hearing to approve the project.
134.19 	(b) Before or at the time of approval of the tax increment financing plan, the 
134.20 	municipality shall make the following findings, and shall set forth in writing the reasons 
134.21 	and supporting facts for each determination:
134.22 	(1) that the proposed tax increment financing district is a redevelopment district, a 
134.23 	renewal or renovation district, a housing district, a soils condition district, soil deficiency 
134.24 	district, or an economic development district; if the proposed district is a redevelopment 
134.25 	district or a renewal or renovation district, the reasons and supporting facts for the 
134.26 	determination that the district meets the criteria of section 469.174, subdivision 10, 
134.27 	paragraph (a), clauses (1) and (2), or subdivision 10a, must be documented in writing 
134.28 	and retained and made available to the public by the authority until the district has been 
134.29 	terminated;
134.30 	(2) that, in the opinion of the municipality:
134.31 	(i) the proposed development or redevelopment would not reasonably be expected to 
134.32 	occur solely through private investment within the reasonably foreseeable future; and
134.33 	(ii) the increased market value of the site that could reasonably be expected to occur 
134.34 	without the use of tax increment financing would be less than the increase in the market 
134.35 	value estimated to result from the proposed development after subtracting the present 
135.1 	value of the projected tax increments for the maximum duration of the district permitted 
135.2 	by the plan. The requirements of this item do not apply if the district is a housing district;
135.3 	(3) that the tax increment financing plan conforms to the general plan for the 
135.4 	development or redevelopment of the municipality as a whole;
135.5 	(4) that the tax increment financing plan will afford maximum opportunity, 
135.6 	consistent with the sound needs of the municipality as a whole, for the development or 
135.7 	redevelopment of the project by private enterprise;
135.8 	(5) that the municipality elects the method of tax increment computation set forth in 
135.9 	section 469.177, subdivision 3, paragraph (b), if applicable; and
135.10 	(6) that for a redevelopment district, renewal and renovation district, soils condition 
135.11 	district, or soil deficiency district established by the authority in a mining reclamation 
135.12 	project area, the reasons and supporting facts for the determination that the mining 
135.13 	reclamation project area meets the requirements under section 469.174, subdivision 30, 
135.14 	must be documented in writing and retained and made available to the public by the 
135.15 	authority until two years after the district is decertified. These findings must have been 
135.16 	made and documented no more than ten years before approval of the tax increment 
135.17 	financing plan for the district.
135.18 	(c) When the municipality and the authority are not the same, the municipality shall 
135.19 	approve or disapprove the tax increment financing plan within 60 days of submission by 
135.20 	the authority. When the municipality and the authority are not the same, the municipality 
135.21 	may not amend or modify a tax increment financing plan except as proposed by the 
135.22 	authority pursuant to subdivision 4. Once approved, the determination of the authority 
135.23 	to undertake the project through the use of tax increment financing and the resolution of 
135.24 	the governing body shall be conclusive of the findings therein and of the public need for 
135.25 	the financing.
135.26 	(d) For a district that is subject to the requirements of paragraph (b), clause (2), 
135.27 	item (ii), the municipality's statement of reasons and supporting facts must include all of 
135.28 	the following:
135.29 	(1) an estimate of the amount by which the market value of the site will increase 
135.30 	without the use of tax increment financing;
135.31 	(2) an estimate of the increase in the market value that will result from the 
135.32 	development or redevelopment to be assisted with tax increment financing; and
135.33 	(3) the present value of the projected tax increments for the maximum duration of 
135.34 	the district permitted by the tax increment financing plan.
135.35 	(e) For purposes of this subdivision, "site" means the parcels on which the 
135.36 	development or redevelopment to be assisted with tax increment financing will be located.

136.1 	EFFECTIVE DATE. This section is effective for districts for which the request for 
136.2 	certification is made after April 30, 2012.

136.3 	Sec. 6. Minnesota Statutes 2010, section 469.176, subdivision 1b, is amended to read:
136.4 		Subd. 1b.Duration limits; terms. (a) No tax increment shall in any event be 
136.5 	paid to the authority:
136.6 	(1) after 15 years after receipt by the authority of the first increment for a renewal 
136.7 	and renovation district;
136.8 	(2) after 20 years after receipt by the authority of the first increment for a soils 
136.9 	condition district or a soil deficiency district;
136.10 	(3) after eight years after receipt by the authority of the first increment for an 
136.11 	economic development district;
136.12 	(4) for a housing district, a compact development district, or a redevelopment 
136.13 	district, after 25 years from the date of receipt by the authority of the first increment.
136.14 	(b) For purposes of determining a duration limit under this subdivision or subdivision 
136.15 	1e that is based on the receipt of an increment, any increments from taxes payable in 
136.16 	the year in which the district terminates shall be paid to the authority. This paragraph 
136.17 	does not affect a duration limit calculated from the date of approval of the tax increment 
136.18 	financing plan or based on the recovery of costs or to a duration limit under subdivision 
136.19 	1c. This paragraph does not supersede the restrictions on payment of delinquent taxes in 
136.20 	subdivision 1f.
136.21 	(c) An action by the authority to waive or decline to accept an increment has no 
136.22 	effect for purposes of computing a duration limit based on the receipt of increment under 
136.23 	this subdivision or any other provision of law. The authority is deemed to have received an 
136.24 	increment for any year in which it waived or declined to accept an increment, regardless 
136.25 	of whether the increment was paid to the authority.
136.26 	(d) Receipt by a hazardous substance subdistrict of an increment as a result of a 
136.27 	reduction in original net tax capacity under section 469.174, subdivision 7, paragraph 
136.28 	(b), does not constitute receipt of increment by the overlying district for the purpose of 
136.29 	calculating the duration limit under this section.

136.30 	EFFECTIVE DATE. This section is effective for districts for which the request for 
136.31 	certification is made after April 30, 2012.

136.32 	Sec. 7. Minnesota Statutes 2010, section 469.176, subdivision 4b, is amended to read:
136.33 		Subd. 4b.Soils condition districts. Revenue derived from Tax increment from a 
136.34 	soils condition district may be used only to (1) acquire parcels on which the improvements 
137.1 	described in clause (2) will occur; (2) pay for the cost of removal or remedial action; and 
137.2 	(3) pay for the administrative expenses of the authority allocable to the district, including 
137.3 	the cost of preparation of the development action response plan. For a soils condition 
137.4 	district located in a mining reclamation project area, tax increments may also be expended 
137.5 	on the additional cost of public improvements directly caused by the removal or remedial 
137.6 	action and located within the mining reclamation project area.

137.7 	EFFECTIVE DATE. This section is effective for districts for which the request for 
137.8 	certification is made after April 30, 2012.

137.9 	Sec. 8. Minnesota Statutes 2011 Supplement, section 469.176, subdivision 4c, is 
137.10 	amended to read:
137.11 		Subd. 4c.Economic development districts. (a) Revenue derived from tax 
137.12 	increment from an economic development district may not be used to provide 
137.13 	improvements, loans, subsidies, grants, interest rate subsidies, or assistance in any form 
137.14 	to developments consisting of buildings and ancillary facilities, if more than 15 percent 
137.15 	of the buildings and facilities (determined on the basis of square footage) are used for a 
137.16 	purpose other than:
137.17 	(1) the manufacturing or production of tangible personal property, including 
137.18 	processing resulting in the change in condition of the property;
137.19 	(2) warehousing, storage, and distribution of tangible personal property, excluding 
137.20 	retail sales;
137.21 	(3) research and development related to the activities listed in clause (1) or (2);
137.22 	(4) telemarketing if that activity is the exclusive use of the property;
137.23 	(5) tourism facilities;
137.24 	(6) qualified border retail facilities; or
137.25 	(7) space necessary for and related to the activities listed in clauses (1) to (6).
137.26 	(b) Notwithstanding the provisions of this subdivision, revenues derived from tax 
137.27 	increment from an economic development district may be used to provide improvements, 
137.28 	loans, subsidies, grants, interest rate subsidies, or assistance in any form for up to 15,000 
137.29 	square feet of any separately owned commercial facility located within the municipal 
137.30 	jurisdiction of a small city, if the revenues derived from increments are spent only to 
137.31 	assist the facility directly or for administrative expenses, the assistance is necessary to 
137.32 	develop the facility, and all of the increments, except those for administrative expenses, 
137.33 	are spent only for activities within the district.
137.34 	(c) A city is a small city for purposes of this subdivision if the city was a small city 
137.35 	in the year in which the request for certification was made and applies for the rest of 
138.1 	the duration of the district, regardless of whether the city qualifies or ceases to qualify 
138.2 	as a small city.
138.3 	(d) Notwithstanding the requirements of paragraph (a) and the finding requirements 
138.4 	of section 469.174, subdivision 12, tax increments from an economic development district 
138.5 	may be used to provide improvements, loans, subsidies, grants, interest rate subsidies, or 
138.6 	assistance in any form to developments consisting of buildings and ancillary facilities, if 
138.7 	all the following conditions are met:
138.8 	(1) the municipality finds that the project will create or retain jobs in this state, 
138.9 	including construction jobs, and that construction of the project would not have 
138.10 	commenced before July 1, 2012 January 1, 2014, without the authority providing 
138.11 	assistance under the provisions of this paragraph;
138.12 	(2) construction of the project begins no later than July 1, 2012 January 1, 2014;
138.13 	(3) the request for certification of the district is made no later than June 30, 2012
138.14 	December 31, 2013; and
138.15 	(4) for development of housing under this paragraph, the construction must begin 
138.16 	before January 1, 2012.
138.17 	The provisions of this paragraph may not be used to assist housing that is developed 
138.18 	to qualify under section 469.1761, subdivision 2 or 3, or similar requirements of other law, 
138.19 	if construction of the project begins later than July 1, 2011.

138.20 	EFFECTIVE DATE. This section is effective the day following final enactment.

138.21 	Sec. 9. Minnesota Statutes 2011 Supplement, section 469.176, subdivision 4m, is 
138.22 	amended to read:
138.23 		Subd. 4m.Temporary authority to stimulate construction. (a) Notwithstanding 
138.24 	the restrictions in any other subdivision of this section or any other law to the contrary, 
138.25 	except the requirement to pay bonds to which the increments are pledged and the 
138.26 	provisions of subdivisions 4g and 4h, the authority may spend tax increments for one or 
138.27 	more of the following purposes:
138.28 	(1) to provide improvements, loans, interest rate subsidies, or assistance in any 
138.29 	form to private development consisting of the construction or substantial rehabilitation of 
138.30 	buildings and ancillary facilities, if doing so will create or retain jobs in this state, including 
138.31 	construction jobs, and that the construction commences before July 1, 2012 January 1, 
138.32 	2014, and would not have commenced before that date without the assistance; or
138.33 	(2) to make an equity or similar investment in a corporation, partnership, or limited 
138.34 	liability company that the authority determines is necessary to make construction of a 
138.35 	development that meets the requirements of clause (1) financially feasible.
139.1 	(b) The authority may undertake actions under the authority of this subdivision only 
139.2 	after approval by the municipality of a written spending plan that specifically authorizes 
139.3 	the authority to take the actions. The spending plan must contain a detailed description 
139.4 	of each action to be undertaken. The municipality shall approve the spending plan only 
139.5 	after a public hearing after published notice in a newspaper of general circulation in 
139.6 	the municipality at least once, not less than ten days nor more than 30 days prior to the 
139.7 	date of the hearing.
139.8 	(c) The authority to spend tax increments under this subdivision expires December 
139.9 	31, 2012 June 30, 2014.
139.10 	(d) For a development consisting of housing, the authority to spend tax increments 
139.11 	under this subdivision expires December 31, 2011, and construction must commence 
139.12 	before July 1, 2011, except the authority to spend tax increments on market rate housing 
139.13 	developments under this subdivision expires July 31, 2012, and construction must 
139.14 	commence before January 1, 2012.

139.15 	EFFECTIVE DATE. This section is effective the day following final enactment 
139.16 	and applies to all tax increment financing districts, regardless of when the request for 
139.17 	certification was made. The amendments to paragraph (b) apply to projects approved 
139.18 	after June 30, 2012.

139.19 	Sec. 10. Minnesota Statutes 2010, section 469.176, is amended by adding a subdivision 
139.20 	to read:
139.21 		Subd. 4n.Soil deficiency district. Tax increments from a soil deficiency district 
139.22 	may only be used to pay for the following costs for activities located within the mining 
139.23 	reclamation project area:
139.24 	(1) acquisition of parcels on which the improvements described in clause (2) will 
139.25 	occur;
139.26 	(2) the cost of correcting the unusual terrain or soil deficiencies and the additional 
139.27 	cost of installing public improvements directly caused by the deficiencies;
139.28 	(3) administrative expenses of the authority allocable to the district; and
139.29 	(4) costs described in subdivision 4j for the district, if these payments do not exceed 
139.30 	25 percent of the tax increment from the district.

139.31 	EFFECTIVE DATE. This section is effective for districts for which the request for 
139.32 	certification is made after April 30, 2012.

140.1 	Sec. 11. Minnesota Statutes 2011 Supplement, section 469.1763, subdivision 2, 
140.2 	is amended to read:
140.3 		Subd. 2.Expenditures outside district. (a) For each tax increment financing 
140.4 	district, an amount equal to at least 75 percent of the total revenue derived from tax 
140.5 	increments paid by properties in the district must be expended on activities in the district 
140.6 	or to pay bonds, to the extent that the proceeds of the bonds were used to finance activities 
140.7 	in the district or to pay, or secure payment of, debt service on credit enhanced bonds. 
140.8 	For districts, other than redevelopment districts for which the request for certification 
140.9 	was made after June 30, 1995, the in-district percentage for purposes of the preceding 
140.10 	sentence is 80 percent. Not more than 25 percent of the total revenue derived from tax 
140.11 	increments paid by properties in the district may be expended, through a development fund 
140.12 	or otherwise, on activities outside of the district but within the defined geographic area of 
140.13 	the project except to pay, or secure payment of, debt service on credit enhanced bonds. 
140.14 	For districts, other than redevelopment districts for which the request for certification was 
140.15 	made after June 30, 1995, the pooling percentage for purposes of the preceding sentence is 
140.16 	20 percent. The revenue derived from tax increments for the district that are expended on 
140.17 	costs under section 469.176, subdivision 4h, paragraph (b), may be deducted first before 
140.18 	calculating the percentages that must be expended within and without the district.
140.19 	(b) In the case of a housing district, a housing project, as defined in section 469.174, 
140.20 	subdivision 11, is an activity in the district.
140.21 	(c) All administrative expenses are for activities outside of the district, except that 
140.22 	if the only expenses for activities outside of the district under this subdivision are for 
140.23 	the purposes described in paragraph (d), administrative expenses will be considered as 
140.24 	expenditures for activities in the district.
140.25 	(d) The authority may elect, in the tax increment financing plan for the district, 
140.26 	to increase by up to ten percentage points the permitted amount of expenditures for 
140.27 	activities located outside the geographic area of the district under paragraph (a). As 
140.28 	permitted by section 469.176, subdivision 4k, the expenditures, including the permitted 
140.29 	expenditures under paragraph (a), need not be made within the geographic area of the 
140.30 	project. Expenditures that meet the requirements of this paragraph are legally permitted 
140.31 	expenditures of the district, notwithstanding section 469.176, subdivisions 4b, 4c, 4d, and 
140.32 	4j. To qualify for the increase under this paragraph, the expenditures must:
140.33 	(1) be used exclusively to assist housing that
140.34 	(i) meets the requirement for a qualified low-income building, as that term is used in 
140.35 	section 42 of the Internal Revenue Code; and
141.1 	(2) (ii) does not exceed the qualified basis of the housing, as defined under section 
141.2 	42(c) of the Internal Revenue Code, less the amount of any credit allowed under section 
141.3 	42 of the Internal Revenue Code; and
141.4 	(3) be (iii) is used to:
141.5 	(i) (A) acquire and prepare the site of the housing;
141.6 	(ii) (B) acquire, construct, or rehabilitate the housing; or
141.7 	(iii) (C) make public improvements directly related to the housing; or
141.8 	(4) (2) be used to develop housing:
141.9 	(i) if the market value of the housing  prior to demolition or rehabilitation does 
141.10 	not exceed the lesser of:
141.11 	(A) 150 percent of the average market value of single-family homes in that 
141.12 	municipality; or
141.13 	(B) $200,000 for municipalities located in the metropolitan area, as defined in 
141.14 	section 473.121, or $125,000 for all other municipalities; and
141.15 	(ii) if the expenditures are used to pay the cost of site acquisition, relocation, 
141.16 	demolition of existing structures, site preparation, rehabilitation, and pollution abatement 
141.17 	on one or more parcels, if provided that the parcel contains a residence containing is 
141.18 	occupied by one to four family dwelling units that has been vacant for six or more months 
141.19 	and is in foreclosure as defined in section 325N.10, subdivision 7, but without regard to 
141.20 	whether the residence is the owner's principal residence, and only after the redemption 
141.21 	period stated in the notice provided under section 580.06 has expired with respect to which 
141.22 	a mortgage was foreclosed under chapter 580, 581, or 582; any applicable redemption 
141.23 	period has expired without redemption; and the authority or developer enters into a 
141.24 	purchase agreement to acquire the parcel no earlier than 30 days after expiration of the 
141.25 	redemption period.
141.26 	(e) For a district created within a biotechnology and health sciences industry zone 
141.27 	as defined in section 469.330, subdivision 6, or for an existing district located within 
141.28 	such a zone, tax increment derived from such a district may be expended outside of the 
141.29 	district but within the zone only for expenditures required for the construction of public 
141.30 	infrastructure necessary to support the activities of the zone, land acquisition, and other 
141.31 	redevelopment costs as defined in section 469.176, subdivision 4j. These expenditures are 
141.32 	considered as expenditures for activities within the district.
141.33 	(f) The authority under paragraph (d), clause (4) (2), expires on December 31, 2016. 
141.34 	Increments may continue to be expended under this authority after that date, if they are 
141.35 	used to pay bonds or binding contracts that would qualify under subdivision 3, paragraph 
142.1 	(a), if December 31, 2016, is considered to be the last date of the five-year period after 
142.2 	certification under that provision.
142.3 	(g) The authority may elect, in the tax increment financing plan, for a district located 
142.4 	in a mining reclamation area that "activities within the district" under paragraph (a) 
142.5 	includes activities within the geographic area of the mining reclamation area.

142.6 	EFFECTIVE DATE. This section is effective for any district that is subject to 
142.7 	the provisions of Minnesota Statutes, section 469.1763, regardless of when the request 
142.8 	for certification was made, except the amendment adding paragraph (g) is effective for 
142.9 	districts for which the request for certification was made after April 30, 2012.

142.10 	Sec. 12. Minnesota Statutes 2010, section 469.1763, subdivision 3, is amended to read:
142.11 		Subd. 3.Five-year rule. (a) Revenues derived from tax increments are considered 
142.12 	to have been expended on an activity within the district under subdivision 2 only if one 
142.13 	of the following occurs:
142.14 	(1) before or within five years after certification of the district, the revenues are 
142.15 	actually paid to a third party with respect to the activity;
142.16 	(2) bonds, the proceeds of which must be used to finance the activity, are issued and 
142.17 	sold to a third party before or within five years after certification, the revenues are spent 
142.18 	to repay the bonds, and the proceeds of the bonds either are, on the date of issuance, 
142.19 	reasonably expected to be spent before the end of the later of (i) the five-year period, or 
142.20 	(ii) a reasonable temporary period within the meaning of the use of that term under section 
142.21 	148(c)(1) of the Internal Revenue Code, or are deposited in a reasonably required reserve 
142.22 	or replacement fund;
142.23 	(3) binding contracts with a third party are entered into for performance of the 
142.24 	activity before or within five years after certification of the district and the revenues are 
142.25 	spent under the contractual obligation;
142.26 	(4) costs with respect to the activity are paid before or within five years after 
142.27 	certification of the district and the revenues are spent to reimburse a party for payment 
142.28 	of the costs, including interest on unreimbursed costs; or
142.29 	(5) expenditures are made for housing purposes as permitted by subdivision 2, 
142.30 	paragraphs (b) and (d), or for public infrastructure purposes within a zone as permitted 
142.31 	by subdivision 2, paragraph (e).
142.32 	(b) For purposes of this subdivision, bonds include subsequent refunding bonds if 
142.33 	the original refunded bonds meet the requirements of paragraph (a), clause (2).
142.34 	(c) For a redevelopment district or a renewal and renovation district certified after 
142.35 	June 30, 2003, and before April 20, 2009, the five-year periods described in paragraph 
143.1 	(a) are extended to ten years after certification of the district. This extension is provided 
143.2 	primarily to accommodate delays in development activities due to unanticipated economic 
143.3 	circumstances.
143.4 	(d) If the authority so elects in the tax increment financing plan for a redevelopment 
143.5 	district, renewal and renovation district, soils condition district, or soil deficiency district 
143.6 	located in a mining reclamation project area, the five-year periods described in paragraph 
143.7 	(a) do not apply.

143.8 	EFFECTIVE DATE. This section is effective for districts for which the request for 
143.9 	certification is made after April 30, 2012.

143.10 	Sec. 13. Minnesota Statutes 2010, section 469.1763, subdivision 4, is amended to read:
143.11 		Subd. 4.Use of revenues for decertification. (a) In each year beginning with the 
143.12 	sixth year following certification of the district, if the applicable in-district percent of the 
143.13 	revenues derived from tax increments paid by properties in the district exceeds the amount 
143.14 	of expenditures that have been made for costs permitted under subdivision 3, an amount 
143.15 	equal to the difference between the in-district percent of the revenues derived from tax 
143.16 	increments paid by properties in the district and the amount of expenditures that have 
143.17 	been made for costs permitted under subdivision 3 must be used and only used to pay or 
143.18 	defease the following or be set aside to pay the following:
143.19 	(1) outstanding bonds, as defined in subdivision 3, paragraphs (a), clause (2), and (b);
143.20 	(2) contracts, as defined in subdivision 3, paragraph (a), clauses (3) and (4);
143.21 	(3) credit enhanced bonds to which the revenues derived from tax increments are 
143.22 	pledged, but only to the extent that revenues of the district for which the credit enhanced 
143.23 	bonds were issued are insufficient to pay the bonds and to the extent that the increments 
143.24 	from the applicable pooling percent share for the district are insufficient; or
143.25 	(4) the amount provided by the tax increment financing plan to be paid under 
143.26 	subdivision 2, paragraphs (b), (d), and (e).
143.27 	(b) The district must be decertified and the pledge of tax increment discharged 
143.28 	when the outstanding bonds have been defeased and when sufficient money has been set 
143.29 	aside to pay, based on the increment to be collected through the end of the calendar year, 
143.30 	the following amounts:
143.31 	(1) contractual obligations as defined in subdivision 3, paragraph (a), clauses (3) 
143.32 	and (4);
143.33 	(2) the amount specified in the tax increment financing plan for activities qualifying 
143.34 	under subdivision 2, paragraph (b), that have not been funded with the proceeds of bonds 
143.35 	qualifying under paragraph (a), clause (1); and
144.1 	(3) the additional expenditures permitted by the tax increment financing plan for 
144.2 	housing activities under an election under subdivision 2, paragraph (d), that have not been 
144.3 	funded with the proceeds of bonds qualifying under paragraph (a), clause (1).
144.4 	(c) If the authority so elects in the tax increment financing plan for a redevelopment 
144.5 	district, renewal and renovation district, soils condition district, or soil deficiency district 
144.6 	located in a mining reclamation project area, the provisions of this section do not apply.

144.7 	EFFECTIVE DATE. This section is effective for districts for which the request for 
144.8 	certification is made after April 30, 2012.

144.9 	Sec. 14. Laws 2008, chapter 366, article 5, section 34, as amended by Laws 2009, 
144.10 	chapter 88, article 5, section 11, is amended to read:
144.11 	Sec. 34. CITY OF OAKDALE; ORIGINAL TAX CAPACITY. 
 144.12 		Subdivision 1.Original tax capacity election. (a) The provisions of this section 
144.13 	apply to redevelopment tax increment financing districts created by the Housing and 
144.14 	Redevelopment Authority in and for the city of Oakdale in the areas comprised of 
144.15 	the parcels with the following parcel identification numbers: (1) 3102921320053; 
144.16 	3102921320054; 3102921320055; 3102921320056; 3102921320057; 3102921320058; 
144.17 	3102921320062; 3102921320063; 3102921320059; 3102921320060; 3102921320061; 
144.18 	3102921330005; and 3102921330004; and (2) 2902921330001 and 2902921330005.
144.19 	(b) For a district subject to this section, the Housing and Redevelopment Authority 
144.20 	may, when requesting certification of the original tax capacity of the district under 
144.21 	Minnesota Statutes, section 469.177, elect to have the original tax capacity of the district 
144.22 	be certified as the tax capacity of the land.
144.23 	(c) The authority to request certification of a district under this section expires on 
144.24 	July 1, 2013 December 31, 2017.
144.25 		Subd. 2.Parcels deemed occupied. (a) Parcel numbers 3102921320054, 
144.26 	3102921320055, 3102921320056, 3102921320057, 3102921320061, and 3102921330004 
144.27 	are deemed to meet the requirements of Minnesota Statutes, section 469.174, subdivision 
144.28 	10, paragraph (d), notwithstanding any contrary provisions of that paragraph, if the 
144.29 	following conditions are met:
144.30 	(1) a building located on any part of each of the specified parcels was demolished 
144.31 	after the authority adopted a resolution under Minnesota Statutes, section 469.174, 
144.32 	subdivision 10, paragraph (d), clause (3);
144.33 	(2) the building was removed either by the authority, by a developer under a 
144.34 	development agreement with the authority, or by the owner of the property without 
144.35 	entering into a development agreement with the authority; and
145.1 	(3) the request for certification of the parcel as part of a district is filed with the 
145.2 	county auditor by December 31, 2017.
145.3 	(b) The provisions of subdivision 1 apply to allow an election by the authority 
145.4 	for the parcels deemed occupied under paragraph (a), notwithstanding the provisions 
145.5 	of Minnesota Statutes, sections 469.174, subdivision 10, paragraph (d), and 469.177, 
145.6 	subdivision 1, paragraph (f).

145.7 	EFFECTIVE DATE. This section is effective upon compliance by the governing 
145.8 	body of the city of Oakdale with the requirements of Minnesota Statutes, section 645.021, 
145.9 	subdivision 3.

145.10 	Sec. 15. CITY OF BLOOMINGTON; TAX INCREMENT FINANCING.
 145.11 	Notwithstanding Minnesota Statutes, section 469.176, or Laws 1996, chapter 464, 
145.12 	article 1, section 8, or any other law to the contrary, the city of Bloomington and its port 
145.13 	authority may extend the duration limits of tax increment financing district No. 1-G, 
145.14 	containing the former Met Center property, including Lindau Lane and that portion of tax 
145.15 	increment financing district No. 1-C north of the existing building line on Lot 1, Block 1, 
145.16 	Mall of America 7th Addition, exclusive of Lots 2 and 3, through December 31, 2038.

145.17 	EFFECTIVE DATE. This section is effective upon compliance of the governing 
145.18 	bodies of the city of Bloomington, Hennepin County, and Independent School District 
145.19 	No. 271, Bloomington, with the requirements of Minnesota Statutes, sections 469.1782, 
145.20 	subdivision 2, and 645.021, subdivision 3.

145.21 	Sec. 16. CITY OF BLOOMINGTON; TAX INCREMENT FINANCING 
145.22 	EXTENSION.
 145.23 	Notwithstanding the provisions of Minnesota Statutes, section 469.176, or any other 
145.24 	law to the contrary, the city of Bloomington and its port authority may extend the duration 
145.25 	limits of Tax Increment Financing District No. 1-I, containing the Bloomington Central 
145.26 	Station property for a period through December 31, 2038.

145.27 	EFFECTIVE DATE. This section is effective upon compliance of the governing 
145.28 	body of the city of Bloomington with the requirements of Minnesota Statutes, sections 
145.29 	469.1782, subdivision 2, and 645.021, subdivision 3.

145.30 	Sec. 17. DAKOTA COUNTY COMMUNITY DEVELOPMENT AGENCY; TAX 
145.31 	INCREMENT FINANCING DISTRICT.
 146.1 		Subdivision 1.Authorization. Notwithstanding the provisions of any other law, 
146.2 	the Dakota County Community Development Agency may establish a redevelopment tax 
146.3 	increment financing district comprised of the properties that (1) were included in the 
146.4 	CDA 10 Robert and South Street district in the city of West St. Paul, and (2) were not 
146.5 	decertified before July 1, 2012. The district created under this section terminates no later 
146.6 	than December 31, 2027.
146.7 		Subd. 2.Special rules. The requirements for qualifying a redevelopment district 
146.8 	under Minnesota Statutes, section 469.174, subdivision 10, do not apply to parcels located 
146.9 	within the district. Minnesota Statutes, section 469.176, subdivisions 4g, paragraph (c), 
146.10 	clause (1), item (ii), 4j, and 4l, do not apply to the district. The original tax capacity 
146.11 	of the district is $93,239.
146.12 		Subd. 3.Authorized expenditures. Tax increment from the district may be 
146.13 	expended to pay for any eligible activities authorized by Minnesota Statutes, chapter 
146.14 	469, within the redevelopment area that includes the district. All such expenditures are 
146.15 	deemed to be activities within the district under Minnesota Statutes, section 469.1763, 
146.16 	subdivisions 2, 3, and 4.
146.17 		Subd. 4.Adjusted net tax capacity. The captured tax capacity of the district must 
146.18 	be included in the adjusted net tax capacity of the city, county, and school district for the 
146.19 	purposes of determining local government aid, education aid, and county program aid. 
146.20 	The county auditor shall report to the commissioner of revenue the amount of the captured 
146.21 	tax capacity for the district at the time the assessment abstracts are filed.

146.22 	EFFECTIVE DATE. This section is effective upon compliance by the governing 
146.23 	body of the Dakota County Community Development Agency with the requirements of 
146.24 	Minnesota Statutes, section 645.021, subdivision 3.

146.25 	Sec. 18. CITY OF BROOKLYN PARK; TAX INCREMENT FINANCING; 
146.26 	SPECIAL RULES.
 146.27 	The requirement of Minnesota Statutes, section 469.1763, subdivision 3, that 
146.28 	activities must be undertaken within a five-year period from the date of certification of a tax 
146.29 	increment financing district, is considered to be met for Tax Increment Financing District 
146.30 	No. 23 in the city of Brooklyn Park if the activities were undertaken by July 1, 2014.

146.31 	EFFECTIVE DATE. This section is effective upon compliance by the governing 
146.32 	body of the city of Brooklyn Park with the requirements of Minnesota Statutes, section 
146.33 	645.021, subdivision 3.

147.1 	Sec. 19. ST. CLOUD; TAX INCREMENT FINANCING.
 147.2 	The request for certification of Tax Increment District No. 2, commonly referred to 
147.3 	as the Norwest District, in the city of St. Cloud is deemed to have been made on or after 
147.4 	August 1, 1979, and before July 1, 1982. Revenues derived from tax increment for that 
147.5 	district must be treated for purposes of any law as revenue of a tax increment financing 
147.6 	district for which the request for certification was made during that time period.

147.7 	EFFECTIVE DATE. This section is effective upon approval by the governing 
147.8 	body of the city of St. Cloud and compliance with Minnesota Statutes, section 645.021, 
147.9 	subdivision 3.

147.10 	ARTICLE 11
147.11 	ESTATE TAXES

147.12 	Section 1. Minnesota Statutes 2010, section 289A.10, is amended by adding a 
147.13 	subdivision to read:
147.14 		Subd. 1a.Recapture tax return required. If a disposition or cessation as provided 
147.15 	by section 291.03, subdivision 11, paragraph (a), has occurred, the qualified heir, as 
147.16 	defined under section 291.03, subdivision 8, paragraph (c), or personal representative of 
147.17 	the decedent's estate must submit a recapture tax return to the commissioner.

147.18 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
147.19 	June 30, 2011.

147.20 	Sec. 2. Minnesota Statutes 2010, section 289A.12, is amended by adding a subdivision 
147.21 	to read:
147.22 		Subd. 18.Returns by qualified heirs. Within 24 months and within 36 months 
147.23 	after a decedent's death, a qualified heir, as defined under section 291.03, subdivision 8, 
147.24 	paragraph (c), must file a return with the commissioner relating to the qualified property 
147.25 	received from the decedent.

147.26 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
147.27 	June 30, 2011.

147.28 	Sec. 3. Minnesota Statutes 2010, section 289A.18, is amended by adding a subdivision 
147.29 	to read:
148.1 		Subd. 3a.Recapture tax return. A recapture tax return is due within six months 
148.2 	after the date of the disposition or cessation as provided by section 291.03, subdivision 
148.3 	11, paragraph (a).

148.4 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
148.5 	June 30, 2011.

148.6 	Sec. 4. Minnesota Statutes 2010, section 289A.20, subdivision 3, is amended to read:
148.7 		Subd. 3.Estate tax. Taxes imposed by chapter 291 section 291.03, subdivision 1,
148.8 	take effect at and upon the death of the person whose estate is subject to taxation and are 
148.9 	due and payable on or before the expiration of nine months from that death.

148.10 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
148.11 	June 30, 2011.

148.12 	Sec. 5. Minnesota Statutes 2010, section 289A.20, is amended by adding a subdivision 
148.13 	to read:
148.14 		Subd. 3a.Recapture tax. Taxes imposed by section 291.03, subdivision 11, 
148.15 	paragraph (b), are due and payable on or before the expiration of six months from the date 
148.16 	of disposition or cessation as provided by section 291.03, subdivision 11, paragraph (a).

148.17 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
148.18 	June 30, 2011.

148.19 	Sec. 6. Minnesota Statutes 2011 Supplement, section 291.03, subdivision 8, is 
148.20 	amended to read:
148.21 		Subd. 8.Definitions. (a) For purposes of this section, the following terms have the 
148.22 	meanings given in this subdivision.
148.23 	(b) "Family member" means a family member as defined in section 2032A(e)(2) of 
148.24 	the Internal Revenue Code or a trust whose present beneficiaries are all family members as 
148.25 	defined in section 2032A(e)(2) of the Internal Revenue Code.
148.26 	(c) "Qualified heir" means a family member who acquired qualified property from
148.27 	upon the death of the decedent and satisfies the requirement under subdivision 9, clause 
148.28 	(6) (8), or subdivision 10, clause (4) (5), for the property.
148.29 	(d) "Qualified property" means qualified small business property under subdivision 
148.30 	9 and qualified farm property under subdivision 10.

149.1 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
149.2 	June 30, 2011.

149.3 	Sec. 7. Minnesota Statutes 2011 Supplement, section 291.03, subdivision 9, is 
149.4 	amended to read:
149.5 		Subd. 9.Qualified small business property. Property satisfying all of the following 
149.6 	requirements is qualified small business property:
149.7 	(1) The value of the property was included in the federal adjusted taxable estate.
149.8 	(2) The property consists of the assets of a trade or business or shares of stock or 
149.9 	other ownership interests in a corporation or other entity engaged in a trade or business. 
149.10 	The decedent or the decedent's spouse must have materially participated in the trade or 
149.11 	business within the meaning of section 469 of the Internal Revenue Code during the 
149.12 	taxable year that ended before the date of the decedent's death. Shares of stock in a 
149.13 	corporation or an ownership interest in another type of entity do not qualify under this 
149.14 	subdivision if the shares or ownership interests are traded on a public stock exchange at 
149.15 	any time during the three-year period ending on the decedent's date of death. For purposes 
149.16 	of this subdivision, an ownership interest includes the interest the decedent is deemed to 
149.17 	own under sections 2036, 2037, and 2038 of the Internal Revenue Code.
149.18 	(3) During the decedent's taxable year that ended before the decedent's death, the 
149.19 	trade or business must not have been a passive activity within the meaning of section 
149.20 	469(c) of the Internal Revenue Code and the decedent or the decedent's spouse must have 
149.21 	materially participated in the trade or business within the meaning of section 469(h) of the 
149.22 	Internal Revenue Code, excluding section 469(h)(3) of the Internal Revenue Code and 
149.23 	any other provision provided by Treasury Department regulation that substitutes material 
149.24 	participation in prior taxable years for material participation in the taxable year that ended 
149.25 	before the decedent's death.
149.26 	(3) (4) The gross annual sales of the trade or business were $10,000,000 or less for 
149.27 	the last taxable year that ended before the date of the death of the decedent.
149.28 	(4) (5) The property does not consist of cash or, cash equivalents, publicly traded 
149.29 	securities, or assets not used in the operation of the trade or business. For property 
149.30 	consisting of shares of stock or other ownership interests in an entity, the amount value of 
149.31 	cash or, cash equivalents, publicly traded securities, or assets not used in the operation of 
149.32 	the trade or business held by the corporation or other entity must be deducted from the 
149.33 	value of the property qualifying under this subdivision in proportion to the decedent's 
149.34 	share of ownership of the entity on the date of death.
150.1 	(6) The property does not consist of qualified farm property. For property consisting 
150.2 	of shares of stock or other ownership interests in an entity, the value of the qualified 
150.3 	farm property held by the corporation or other entity must be deducted from the value 
150.4 	of the property qualifying under this subdivision in proportion to the decedent's share of 
150.5 	ownership of the entity on the date of death.
150.6 	(5) (7) The decedent continuously owned the property, including property the 
150.7 	decedent is deemed to own under sections 2036, 2037, and 2038 of the Internal Revenue 
150.8 	Code, for the three-year period ending on the date of death of the decedent. In the case of 
150.9 	a sole proprietor, if the property replaced similar property within the three-year period, 
150.10 	the replacement property will be treated as having been owned for the three-year period 
150.11 	ending on the date of death of the decedent.
150.12 	(6) A family member continuously uses the property in the operation of the trade or 
150.13 	business for three years following the date of death of the decedent.
150.14 	(8) For three years following the date of death of the decedent, the trade or business 
150.15 	is not a passive activity within the meaning of section 469(c) of the Internal Revenue 
150.16 	Code and a family member materially participates in the operation of the trade or business 
150.17 	within the meaning of section 469(h) of the Internal Revenue Code, excluding section 
150.18 	469(h)(3) of the Internal Revenue Code and any other provision provided by Treasury 
150.19 	Department regulation that substitutes material participation in prior taxable years for 
150.20 	material participation in the three years following the date of death of the decedent.
150.21 	(7) (9) The estate and the qualified heir elect to treat the property as qualified small 
150.22 	business property and agree, in the form prescribed by the commissioner, to pay the 
150.23 	recapture tax under subdivision 11, if applicable.

150.24 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
150.25 	June 30, 2011.

150.26 	Sec. 8. Minnesota Statutes 2011 Supplement, section 291.03, subdivision 10, is 
150.27 	amended to read:
150.28 		Subd. 10.Qualified farm property. Property satisfying all of the following 
150.29 	requirements is qualified farm property:
150.30 	(1) The value of the property was included in the federal adjusted taxable estate.
150.31 	(2) The property consists of agricultural land as defined by section 500.24, 
150.32 	subdivision 2, paragraph (g), and owned by a farm meeting the requirements of person 
150.33 	or entity that is not excluded from owning agricultural land by section 500.24, and was 
150.34 	classified for property tax purposes as the homestead of the decedent or the decedent's 
151.1 	spouse or both under section 273.124, and as class 2a property under section 273.13, 
151.2 	subdivision 23.
151.3 	(3) For property taxes payable in the year of decedent's death, the decedent's interest 
151.4 	in the property was classified as the homestead of the decedent or the decedent's spouse or 
151.5 	both under section 273.124, and as class 2a property under section 273.13, subdivision 23.
151.6 	(4) The decedent continuously owned the property, including property the decedent 
151.7 	is deemed to own under sections 2036, 2037, and 2038 of the Internal Revenue Code, for 
151.8 	the three-year period ending on the date of death of the decedent either by ownership of 
151.9 	the agricultural land or pursuant to holding an interest in an entity that is not excluded 
151.10 	from owning agricultural land under section 500.24.
151.11 	(4) A family member continuously uses the property in the operation of the trade or 
151.12 	business (5) The property is classified for property tax purposes as class 2a property under 
151.13 	section 273.13, subdivision 23, for three years following the date of death of the decedent.
151.14 	(5) (6) The estate and the qualified heir elect to treat the property as qualified farm 
151.15 	property and agree, in a form prescribed by the commissioner, to pay the recapture tax 
151.16 	under subdivision 11, if applicable.

151.17 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
151.18 	June 30, 2011.

151.19 	Sec. 9. Minnesota Statutes 2011 Supplement, section 291.03, subdivision 11, is 
151.20 	amended to read:
151.21 		Subd. 11.Recapture tax. (a) If, within three years after the decedent's death and 
151.22 	before the death of the qualified heir, the qualified heir disposes of any interest in the 
151.23 	qualified property, other than by a disposition to a family member or qualifying entity, 
151.24 	or a family member ceases to use the qualified property which was acquired or passed 
151.25 	from the decedent satisfy the requirement under subdivision 9, clause (7); or 10, clause 
151.26 	(5), an additional estate tax is imposed on the property. In the case of a sole proprietor, if 
151.27 	the qualified heir replaces qualified small business property excluded under subdivision 9 
151.28 	with similar property, then the qualified heir will not be treated as having disposed of an 
151.29 	interest in the qualified property.
151.30 	(b) The amount of the additional tax equals the amount of the exclusion claimed with 
151.31 	respect to the qualified interest disposed of by the estate under subdivision 8, paragraph 
151.32 	(d), multiplied by 16 percent.
151.33 	(c) The additional tax under this subdivision is due on the day which is six months 
151.34 	after the date of the disposition or cessation in paragraph (a).
152.1 	(c) For purposes of paragraph (a), "qualifying entity" means a corporation or other 
152.2 	entity that is owned by a family member or family members and, for qualified farm 
152.3 	property, that is not excluded from owning agricultural land under section 500.24.

152.4 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
152.5 	June 30, 2011.

152.6 	ARTICLE 12
152.7 	HOMESTEAD MARKET VALUE CLEANUP

152.8 	Section 1. Minnesota Statutes 2010, section 38.18, is amended to read:
152.9 	38.18 COUNTY FAIRGROUNDS; IMPROVEMENT AIDED.
152.10 	Any Each town, statutory city, or school district in this state, now or hereafter at 
152.11 	any time having a an estimated market value of all its taxable property, exclusive of 
152.12 	money and credits, of more than $105,000,000, and having a county fair located within its 
152.13 	corporate limits, is hereby authorized to aid in defraying may pay part of the expense of 
152.14 	improving any such the fairground, by appropriating and paying over to the treasurer of 
152.15 	the county owning the fairground such sum of money, not exceeding $10,000, for each 
152.16 	of the political subdivisions, as the its governing body of the town, statutory city, or 
152.17 	school district may, by resolution, determine determines to be for the best interest of the 
152.18 	political subdivision,. The sums so appropriated to amounts paid to the county must be 
152.19 	used solely for the purpose of aiding in the improvement of to improve the fairground 
152.20 	in such the manner as the county board of the county shall determine determines to be 
152.21 	for the best interest of the county.

152.22 	Sec. 2. Minnesota Statutes 2010, section 40A.15, subdivision 2, is amended to read:
152.23 		Subd. 2.Eligible recipients. All counties within the state, municipalities that 
152.24 	prepare plans and official controls instead of a county, and districts are eligible for 
152.25 	assistance under the program. Counties and districts may apply for assistance on behalf 
152.26 	of other municipalities. In order to be eligible for financial assistance a county or 
152.27 	municipality must agree to levy at least 0.01209 percent of taxable estimated market 
152.28 	value for agricultural land preservation and conservation activities or otherwise spend the 
152.29 	equivalent amount of local money on those activities, or spend $15,000 of local money, 
152.30 	whichever is less.

152.31 	Sec. 3. Minnesota Statutes 2010, section 69.011, subdivision 1, is amended to read:
153.1 		Subdivision 1.Definitions. Unless the language or context clearly indicates that 
153.2 	a different meaning is intended, the following words and terms, for the purposes of this 
153.3 	chapter and chapters 423, 423A, 424 and 424A, have the meanings ascribed to them:
153.4 	(a) "Commissioner" means the commissioner of revenue.
153.5 	(b) "Municipality" means:
153.6 	(1) a home rule charter or statutory city;
153.7 	(2) an organized town;
153.8 	(3) a park district subject to chapter 398;
153.9 	(4) the University of Minnesota;
153.10 	(5) for purposes of the fire state aid program only, an American Indian tribal 
153.11 	government entity located within a federally recognized American Indian reservation;
153.12 	(6) for purposes of the police state aid program only, an American Indian tribal 
153.13 	government with a tribal police department which exercises state arrest powers under 
153.14 	section 626.90, 626.91, 626.92, or 626.93;
153.15 	(7) for purposes of the police state aid program only, the Metropolitan Airports 
153.16 	Commission; and
153.17 	(8) for purposes of the police state aid program only, the Department of Natural 
153.18 	Resources and the Department of Public Safety with respect to peace officers covered 
153.19 	under chapter 352B.
153.20 	(c) "Minnesota Firetown Premium Report" means a form prescribed by the 
153.21 	commissioner containing space for reporting by insurers of fire, lightning, sprinkler 
153.22 	leakage and extended coverage premiums received upon risks located or to be performed 
153.23 	in this state less return premiums and dividends.
153.24 	(d) "Firetown" means the area serviced by any municipality having a qualified fire 
153.25 	department or a qualified incorporated fire department having a subsidiary volunteer 
153.26 	firefighters' relief association.
153.27 	(e) "Estimated market value" means latest available estimated market value of all 
153.28 	property in a taxing jurisdiction, whether the property is subject to taxation, or exempt 
153.29 	from ad valorem taxation obtained from information which appears on abstracts filed with 
153.30 	the commissioner of revenue or equalized by the State Board of Equalization.
153.31 	(f) "Minnesota Aid to Police Premium Report" means a form prescribed by the 
153.32 	commissioner for reporting by each fire and casualty insurer of all premiums received 
153.33 	upon direct business received by it in this state, or by its agents for it, in cash or otherwise, 
153.34 	during the preceding calendar year, with reference to insurance written for insuring against 
153.35 	the perils contained in auto insurance coverages as reported in the Minnesota business 
153.36 	schedule of the annual financial statement which each insurer is required to file with 
154.1 	the commissioner in accordance with the governing laws or rules less return premiums 
154.2 	and dividends.
154.3 	(g) "Peace officer" means any person:
154.4 	(1) whose primary source of income derived from wages is from direct employment 
154.5 	by a municipality or county as a law enforcement officer on a full-time basis of not less 
154.6 	than 30 hours per week;
154.7 	(2) who has been employed for a minimum of six months prior to December 31 
154.8 	preceding the date of the current year's certification under subdivision 2, clause (b);
154.9 	(3) who is sworn to enforce the general criminal laws of the state and local 
154.10 	ordinances;
154.11 	(4) who is licensed by the Peace Officers Standards and Training Board and is 
154.12 	authorized to arrest with a warrant; and
154.13 	(5) who is a member of the Minneapolis Police Relief Association, the State Patrol 
154.14 	retirement plan, or the public employees police and fire fund.
154.15 	(h) "Full-time equivalent number of peace officers providing contract service" means 
154.16 	the integral or fractional number of peace officers which would be necessary to provide 
154.17 	the contract service if all peace officers providing service were employed on a full-time 
154.18 	basis as defined by the employing unit and the municipality receiving the contract service.
154.19 	(i) "Retirement benefits other than a service pension" means any disbursement 
154.20 	authorized under section 424A.05, subdivision 3, clauses (3) and (4).
154.21 	(j) "Municipal clerk, municipal clerk-treasurer, or county auditor" means the person 
154.22 	who was elected or appointed to the specified position or, in the absence of the person, 
154.23 	another person who is designated by the applicable governing body. In a park district, 
154.24 	the clerk is the secretary of the board of park district commissioners. In the case of the 
154.25 	University of Minnesota, the clerk is that official designated by the Board of Regents. 
154.26 	For the Metropolitan Airports Commission, the clerk is the person designated by the 
154.27 	commission. For the Department of Natural Resources or the Department of Public Safety, 
154.28 	the clerk is the respective commissioner. For a tribal police department which exercises 
154.29 	state arrest powers under section 626.90, 626.91, 626.92, or 626.93, the clerk is the person 
154.30 	designated by the applicable American Indian tribal government.
154.31 	(k) "Voluntary statewide lump-sum volunteer firefighter retirement plan" means the 
154.32 	retirement plan established by chapter 353G.

154.33 	Sec. 4. Minnesota Statutes 2010, section 69.021, subdivision 7, is amended to read:
154.34 		Subd. 7.Apportionment of fire state aid to municipalities and relief associations.
 154.35 	(a) The commissioner shall apportion the fire state aid relative to the premiums reported 
155.1 	on the Minnesota Firetown Premium Reports filed under this chapter to each municipality 
155.2 	and/or firefighters relief association.
155.3 	(b) The commissioner shall calculate an initial fire state aid allocation amount for 
155.4 	each municipality or fire department under paragraph (c) and a minimum fire state aid 
155.5 	allocation amount for each municipality or fire department under paragraph (d). The 
155.6 	municipality or fire department must receive the larger fire state aid amount.
155.7 	(c) The initial fire state aid allocation amount is the amount available for 
155.8 	apportionment as fire state aid under subdivision 5, without inclusion of any additional 
155.9 	funding amount to support a minimum fire state aid amount under section 423A.02, 
155.10 	subdivision 3, allocated one-half in proportion to the population as shown in the last 
155.11 	official statewide federal census for each fire town and one-half in proportion to the 
155.12 	estimated market value of each fire town, including (1) the estimated market value of 
155.13 	tax-exempt property and (2) the estimated market value of natural resources lands 
155.14 	receiving in lieu payments under sections 477A.11 to 477A.14, but excluding the 
155.15 	estimated market value of minerals. In the case of incorporated or municipal fire 
155.16 	departments furnishing fire protection to other cities, towns, or townships as evidenced 
155.17 	by valid fire service contracts filed with the commissioner, the distribution must be 
155.18 	adjusted proportionately to take into consideration the crossover fire protection service. 
155.19 	Necessary adjustments must be made to subsequent apportionments. In the case of 
155.20 	municipalities or independent fire departments qualifying for the aid, the commissioner 
155.21 	shall calculate the state aid for the municipality or relief association on the basis of the 
155.22 	population and the estimated market value of the area furnished fire protection service 
155.23 	by the fire department as evidenced by duly executed and valid fire service agreements 
155.24 	filed with the commissioner. If one or more fire departments are furnishing contracted fire 
155.25 	service to a city, town, or township, only the population and estimated market value of the 
155.26 	area served by each fire department may be considered in calculating the state aid and 
155.27 	the fire departments furnishing service shall enter into an agreement apportioning among 
155.28 	themselves the percent of the population and the estimated market value of each service 
155.29 	area. The agreement must be in writing and must be filed with the commissioner.
155.30 	(d) The minimum fire state aid allocation amount is the amount in addition to the 
155.31 	initial fire state allocation amount that is derived from any additional funding amount 
155.32 	to support a minimum fire state aid amount under section 423A.02, subdivision 3, and 
155.33 	allocated to municipalities with volunteer firefighters relief associations or covered by the 
155.34 	voluntary statewide lump-sum volunteer firefighter retirement plan based on the number 
155.35 	of active volunteer firefighters who are members of the relief association as reported 
155.36 	in the annual financial reporting for the calendar year 1993 to the Office of the State 
156.1 	Auditor, but not to exceed 30 active volunteer firefighters, so that all municipalities or 
156.2 	fire departments with volunteer firefighters relief associations receive in total at least a 
156.3 	minimum fire state aid amount per 1993 active volunteer firefighter to a maximum of 
156.4 	30 firefighters. If a relief association is established after calendar year 1993 and before 
156.5 	calendar year 2000, the number of active volunteer firefighters who are members of the 
156.6 	relief association as reported in the annual financial reporting for calendar year 1998 
156.7 	to the Office of the State Auditor, but not to exceed 30 active volunteer firefighters, 
156.8 	shall be used in this determination. If a relief association is established after calendar 
156.9 	year 1999, the number of active volunteer firefighters who are members of the relief 
156.10 	association as reported in the first annual financial reporting submitted to the Office of 
156.11 	the State Auditor, but not to exceed 20 active volunteer firefighters, must be used in this 
156.12 	determination. If a relief association is terminated as a result of providing retirement 
156.13 	coverage for volunteer firefighters by the voluntary statewide lump-sum volunteer 
156.14 	firefighter retirement plan under chapter 353G, the number of active volunteer firefighters 
156.15 	of the municipality covered by the statewide plan as certified by the executive director of 
156.16 	the Public Employees Retirement Association to the commissioner and the state auditor, 
156.17 	but not to exceed 30 active firefighters, must be used in this determination.
156.18 	(e) Unless the firefighters of the applicable fire department are members of the 
156.19 	voluntary statewide lump-sum volunteer firefighter retirement plan, the fire state aid must 
156.20 	be paid to the treasurer of the municipality where the fire department is located and the 
156.21 	treasurer of the municipality shall, within 30 days of receipt of the fire state aid, transmit 
156.22 	the aid to the relief association if the relief association has filed a financial report with the 
156.23 	treasurer of the municipality and has met all other statutory provisions pertaining to the 
156.24 	aid apportionment. If the firefighters of the applicable fire department are members of 
156.25 	the voluntary statewide lump-sum volunteer firefighter retirement plan, the fire state aid 
156.26 	must be paid to the executive director of the Public Employees Retirement Association 
156.27 	and deposited in the voluntary statewide lump-sum volunteer firefighter retirement fund.
156.28 	(f) The commissioner may make rules to permit the administration of the provisions 
156.29 	of this section.
156.30 	(g) Any adjustments needed to correct prior misallocations must be made to 
156.31 	subsequent apportionments.

156.32 	Sec. 5. Minnesota Statutes 2010, section 69.021, subdivision 8, is amended to read:
156.33 		Subd. 8.Population and estimated market value. (a) In computations relating to 
156.34 	fire state aid requiring the use of population figures, only official statewide federal census 
157.1 	figures are to be used. Increases or decreases in population disclosed by reason of any 
157.2 	special census must not be taken into consideration.
157.3 	(b) In calculations relating to fire state aid requiring the use of estimated market 
157.4 	value property figures, only the latest available estimated market value property figures 
157.5 	may be used.

157.6 	Sec. 6. Minnesota Statutes 2010, section 88.51, subdivision 3, is amended to read:
157.7 		Subd. 3.Determination of market value. In determining the net tax capacity of 
157.8 	property within any taxing district the value of the surface of lands within any auxiliary 
157.9 	forest therein, as determined by the county board under the provisions of section 88.48, 
157.10 	subdivision 3, shall, for all purposes except the levying of taxes on lands within any such 
157.11 	forest, be deemed the estimated market value thereof.

157.12 	Sec. 7. Minnesota Statutes 2010, section 103B.245, subdivision 3, is amended to read:
157.13 		Subd. 3.Tax. After adoption of the ordinance under subdivision 2, a local 
157.14 	government unit may annually levy a tax on all taxable property in the district for the 
157.15 	purposes for which the tax district is established. The tax may not exceed 0.02418 percent 
157.16 	of estimated market value on taxable property located in rural towns other than urban 
157.17 	towns, unless allowed by resolution of the town electors. The proceeds of the tax shall 
157.18 	be paid into a fund reserved for these purposes. Any proceeds remaining in the reserve 
157.19 	fund at the time the tax is terminated or the district is dissolved shall be transferred and 
157.20 	irrevocably pledged to the debt service fund of the local unit to be used solely to reduce 
157.21 	tax levies for bonded indebtedness of taxable property in the district.

157.22 	Sec. 8. Minnesota Statutes 2010, section 103B.251, subdivision 8, is amended to read:
157.23 		Subd. 8.Tax. (a) For the payment of principal and interest on the bonds issued 
157.24 	under subdivision 7 and the payment required under subdivision 6, the county shall 
157.25 	irrevocably pledge and appropriate the proceeds of a tax levied on all taxable property 
157.26 	located within the territory of the watershed management organization or subwatershed 
157.27 	unit for which the bonds are issued. Each year until the reserve for payment of the bonds 
157.28 	is sufficient to retire the bonds, the county shall levy on all taxable property in the territory 
157.29 	of the organization or unit, without respect to any statutory or other limitation on taxes, an 
157.30 	amount of taxes sufficient to pay principal and interest on the bonds and to restore any 
157.31 	deficiencies in reserves required to be maintained for payment of the bonds.
158.1 	(b) The tax levied on rural towns other than urban towns may not exceed 0.02418 
158.2 	percent of taxable estimated market value, unless approved by resolution of the town 
158.3 	electors.
158.4 	(c) If at any time the amounts available from the levy on property in the territory of 
158.5 	the organization are insufficient to pay principal and interest on the bonds when due, the 
158.6 	county shall make payment from any available funds in the county treasury.
158.7 	(d) The amount of any taxes which are required to be levied outside of the territory 
158.8 	of the watershed management organization or unit or taken from the general funds of the 
158.9 	county to pay principal or interest on the bonds shall be reimbursed to the county from 
158.10 	taxes levied within the territory of the watershed management organization or unit.

158.11 	Sec. 9. Minnesota Statutes 2010, section 103B.635, subdivision 2, is amended to read:
158.12 		Subd. 2.Municipal funding of district. (a) The governing body or board of 
158.13 	supervisors of each municipality in the district must provide the funds necessary to meet 
158.14 	its proportion of the total cost determined by the board, provided the total funding from 
158.15 	all municipalities in the district for the costs shall not exceed an amount equal to .00242 
158.16 	percent of the total taxable estimated market value within the district, unless three-fourths 
158.17 	of the municipalities in the district pass a resolution concurring to the additional costs.
158.18 	(b) The funds must be deposited in the treasury of the district in amounts and at 
158.19 	times as the treasurer of the district requires.

158.20 	Sec. 10. Minnesota Statutes 2010, section 103B.691, subdivision 2, is amended to read:
158.21 		Subd. 2.Municipal funding of district. (a) The governing body or board of 
158.22 	supervisors of each municipality in the district shall provide the funds necessary to 
158.23 	meet its proportion of the total cost to be borne by the municipalities as finally certified 
158.24 	by the board.
158.25 	(b) The municipality's funds may be raised by any means within the authority of 
158.26 	the municipality. The municipalities may each levy a tax not to exceed .02418 percent of 
158.27 	taxable estimated market value on the taxable property located in the district to provide 
158.28 	the funds. The levy shall be within all other limitations provided by law.
158.29 	(c) The funds must be deposited into the treasury of the district in amounts and at 
158.30 	times as the treasurer of the district requires.

158.31 	Sec. 11. Minnesota Statutes 2010, section 103D.905, subdivision 2, is amended to read:
158.32 		Subd. 2.Organizational expense fund. (a) An organizational expense fund, 
158.33 	consisting of an ad valorem tax levy, shall not exceed 0.01596 percent of taxableestimated 
159.1 	market value, or $60,000, whichever is less. The money in the fund shall be used for 
159.2 	organizational expenses and preparation of the watershed management plan for projects.
159.3 	(b) The managers may borrow from the affected counties up to 75 percent of the 
159.4 	anticipated funds to be collected from the organizational expense fund levy and the 
159.5 	counties affected may make the advancements.
159.6 	(c) The advancement of anticipated funds shall be apportioned among affected 
159.7 	counties in the same ratio as the net tax capacity of the area of the counties within 
159.8 	the watershed district bears to the net tax capacity of the entire watershed district. If a 
159.9 	watershed district is enlarged, an organizational expense fund may be levied against the 
159.10 	area added to the watershed district in the same manner as provided in this subdivision.
159.11 	(d) Unexpended funds collected for the organizational expense may be transferred to 
159.12 	the administrative fund and used for the purposes of the administrative fund.

159.13 	Sec. 12. Minnesota Statutes 2010, section 103D.905, subdivision 3, is amended to read:
159.14 		Subd. 3.General fund. A general fund, consisting of an ad valorem tax levy, may 
159.15 	not exceed 0.048 percent of taxable estimated market value, or $250,000, whichever is 
159.16 	less. The money in the fund shall be used for general administrative expenses and for 
159.17 	the construction or implementation and maintenance of projects of common benefit to 
159.18 	the watershed district. The managers may make an annual levy for the general fund as 
159.19 	provided in section 103D.911. In addition to the annual general levy, the managers may 
159.20 	annually levy a tax not to exceed 0.00798 percent of taxable estimated market value 
159.21 	for a period not to exceed 15 consecutive years to pay the cost attributable to the basic 
159.22 	water management features of projects initiated by petition of a political subdivision 
159.23 	within the watershed district or by petition of at least 50 resident owners whose property 
159.24 	is within the watershed district.

159.25 	Sec. 13. Minnesota Statutes 2010, section 103D.905, subdivision 8, is amended to read:
159.26 		Subd. 8.Survey and data acquisition fund. (a) A survey and data acquisition fund 
159.27 	is established and used only if other funds are not available to the watershed district to pay 
159.28 	for making necessary surveys and acquiring data.
159.29 	(b) The survey and data acquisition fund consists of the proceeds of a property tax 
159.30 	that can be levied only once every five years. The levy may not exceed 0.02418 percent of 
159.31 	taxable estimated market value.
159.32 	(c) The balance of the survey and data acquisition fund may not exceed $50,000.
160.1 	(d) In a subsequent proceeding for a project where a survey has been made, the 
160.2 	attributable cost of the survey as determined by the managers shall be included as a part of 
160.3 	the cost of the work and the sum shall be repaid to the survey and data acquisition fund.

160.4 	Sec. 14. Minnesota Statutes 2010, section 117.025, subdivision 7, is amended to read:
160.5 		Subd. 7.Structurally substandard. "Structurally substandard" means a building:
160.6 	(1) that was inspected by the appropriate local government and cited for one or more 
160.7 	enforceable housing, maintenance, or building code violations;
160.8 	(2) in which the cited building code violations involve one or more of the following:
160.9 	(i) a roof and roof framing element;
160.10 	(ii) support walls, beams, and headers;
160.11 	(iii) foundation, footings, and subgrade conditions;
160.12 	(iv) light and ventilation;
160.13 	(v) fire protection, including egress;
160.14 	(vi) internal utilities, including electricity, gas, and water;
160.15 	(vii) flooring and flooring elements; or
160.16 	(viii) walls, insulation, and exterior envelope;
160.17 	(3) in which the cited housing, maintenance, or building code violations have not 
160.18 	been remedied after two notices to cure the noncompliance; and
160.19 	(4) has uncured housing, maintenance, and building code violations, satisfaction of 
160.20 	which would cost more than 50 percent of the assessor's taxable estimated market value 
160.21 	for the building, excluding land value, as determined under section 273.11 for property 
160.22 	taxes payable in the year in which the condemnation is commenced.
160.23 	A local government is authorized to seek from a judge or magistrate an administrative 
160.24 	warrant to gain access to inspect a specific building in a proposed development or 
160.25 	redevelopment area upon showing of probable cause that a specific code violation has 
160.26 	occurred and that the violation has not been cured, and that the owner has denied the local 
160.27 	government access to the property. Items of evidence that may support a conclusion of 
160.28 	probable cause may include recent fire or police inspections, housing inspection, exterior 
160.29 	evidence of deterioration, or other similar reliable evidence of deterioration in the specific 
160.30 	building.

160.31 	Sec. 15. Minnesota Statutes 2010, section 127A.48, subdivision 1, is amended to read:
160.32 		Subdivision 1.Computation. The Department of Revenue must annually conduct 
160.33 	an assessment/sales ratio study of the taxable property in each county, city, town, and 
160.34 	school district in accordance with the procedures in subdivisions 2 and 3. Based upon the 
161.1 	results of this assessment/sales ratio study, the Department of Revenue must determine an 
161.2 	aggregate equalized net tax capacity for the various classes of taxable property in each 
161.3 	taxing district, the aggregate of which tax capacity shall beis designated as the adjusted 
161.4 	net tax capacity. The adjusted net tax capacity must be reduced by the captured tax 
161.5 	capacity of tax increment districts under section 469.177, subdivision 2, fiscal disparities 
161.6 	contribution tax capacities under sections 276A.06 and 473F.08, and the tax capacity of 
161.7 	transmission lines required to be subtracted from the local tax base under section 273.425; 
161.8 	and increased by fiscal disparities distribution tax capacities under sections 276A.06 and 
161.9 	473F.08. The adjusted net tax capacities shall be determined using the net tax capacity 
161.10 	percentages in effect for the assessment year following the assessment year of the study. 
161.11 	The Department of Revenue must make whatever estimates are necessary to account for 
161.12 	changes in the classification system. The Department of Revenue may incur the expense 
161.13 	necessary to make the determinations. The commissioner of revenue may reimburse any 
161.14 	county or governmental official for requested services performed in ascertaining the 
161.15 	adjusted net tax capacity. On or before March 15 annually, the Department of Revenue 
161.16 	shall file with the chair of the Tax Committee of the house of representatives and the 
161.17 	chair of the Committee on Taxes and Tax laws of the senate a report of adjusted net tax 
161.18 	capacities for school districts. On or before June 15 annually, the Department of Revenue 
161.19 	shall file its final report on the adjusted net tax capacities for school districts established 
161.20 	by the previous year's assessments and the current year's net tax capacity percentages with 
161.21 	the commissioner of education and each county auditor for those school districts for 
161.22 	which the auditor has the responsibility for determination of local tax rates. A copy of 
161.23 	the report so filed shall be mailed to the clerk of each school district involved and to the 
161.24 	county assessor or supervisor of assessments of the county or counties in which each 
161.25 	school district is located.

161.26 	EFFECTIVE DATE. This section is effective the day following final enactment.

161.27 	Sec. 16. Minnesota Statutes 2010, section 138.053, is amended to read:
161.28 	138.053 COUNTY HISTORICAL SOCIETY; TAX LEVY; CITIES OR 
161.29 	TOWNS.
161.30 	The governing body of any home rule charter or statutory city or town may annually 
161.31 	appropriate from its general fund an amount not to exceed 0.02418 percent of taxable
161.32 	estimated market value, derived from ad valorem taxes on property or other revenues, 
161.33 	to be paid to the historical society of its respective county to be used for the promotion 
161.34 	of historical work and to aid in defraying the expenses of carrying on the historical 
162.1 	work in the county. No city or town may appropriate any funds for the benefit of any 
162.2 	historical society unless the society is affiliated with and approved by the Minnesota 
162.3 	Historical Society.

162.4 	Sec. 17. Minnesota Statutes 2010, section 144F.01, subdivision 4, is amended to read:
162.5 		Subd. 4.Property tax levy authority. The district's board may levy a tax on the 
162.6 	taxable real and personal property in the district. The ad valorem tax levy may not 
162.7 	exceed 0.048 percent of the taxable estimated market value of the district or $400,000, 
162.8 	whichever is less. The proceeds of the levy must be used as provided in subdivision 5. 
162.9 	The board shall certify the levy at the times as provided under section 275.07. The board 
162.10 	shall provide the county with whatever information is necessary to identify the property 
162.11 	that is located within the district. If the boundaries include a part of a parcel, the entire 
162.12 	parcel shall be included in the district. The county auditors must spread, collect, and 
162.13 	distribute the proceeds of the tax at the same time and in the same manner as provided by 
162.14 	law for all other property taxes.

162.15 	Sec. 18. Minnesota Statutes 2010, section 162.07, subdivision 3, is amended to read:
162.16 		Subd. 3.Computation for rural counties. An amount equal to a levy of 0.01596 
162.17 	percent on each rural county's total taxable estimated market value for the last preceding 
162.18 	calendar year shall be computed and shall be subtracted from the county's total estimated 
162.19 	construction costs. The result thereof shall be the money needs of the county. For the 
162.20 	purpose of this section, "rural counties" means all counties having a population of less 
162.21 	than 175,000.

162.22 	Sec. 19. Minnesota Statutes 2010, section 162.07, subdivision 4, is amended to read:
162.23 		Subd. 4.Computation for urban counties. An amount equal to a levy of 0.00967 
162.24 	percent on each urban county's total taxable estimated market value for the last preceding 
162.25 	calendar year shall be computed and shall be subtracted from the county's total estimated 
162.26 	construction costs. The result thereof shall be the money needs of the county. For 
162.27 	the purpose of this section, "urban counties" means all counties having a population 
162.28 	of 175,000 or more.

162.29 	Sec. 20. Minnesota Statutes 2010, section 163.04, subdivision 3, is amended to read:
162.30 		Subd. 3.Bridges within certain cities. When the council of any statutory city or 
162.31 	city of the third or fourth class may determine that it is necessary to build or improve any 
162.32 	bridge or bridges, including approaches thereto, and any dam or retaining works connected 
163.1 	therewith, upon or forming a part of streets or highways either wholly or partly within 
163.2 	its limits, the county board shall appropriate one-half of the money as may be necessary 
163.3 	therefor from the county road and bridge fund, not exceeding during any year one-half 
163.4 	the amount of taxes paid into the county road and bridge fund during the preceding year, 
163.5 	on property within the corporate limits of the city. The appropriation shall be made upon 
163.6 	the petition of the council, which petition shall be filed by the council with the county 
163.7 	board prior to the fixing by the board of the annual county tax levy. The county board 
163.8 	shall determine the plans and specifications, shall let all necessary contracts, shall have 
163.9 	charge of construction, and upon its request, warrants in payment thereof shall be issued 
163.10 	by the county auditor, from time to time, as the construction work proceeds. Any unpaid 
163.11 	balance may be paid or advanced by the city. On petition of the council, the appropriations 
163.12 	of the county board, during not to exceed three successive years, may be made to apply 
163.13 	on the construction of the same items and to repay any money advanced by the city in 
163.14 	the construction thereof. None of the provisions of this section shall be construed to 
163.15 	be mandatory as applied to any city whose estimated market value exceeds $2,100 per 
163.16 	capita of its population.

163.17 	Sec. 21. Minnesota Statutes 2010, section 163.06, subdivision 6, is amended to read:
163.18 		Subd. 6.Expenditure in certain counties. In any county having not less than 95 
163.19 	nor more than 105 full and fractional townships, and having a an estimated market value 
163.20 	of not less than $12,000,000 nor more than $21,000,000, exclusive of money and credits,
163.21 	the county board, by resolution, may expend the funds provided in subdivision 4 in any 
163.22 	organized or unorganized township or portion thereof in such county.

163.23 	Sec. 22. Minnesota Statutes 2010, section 165.10, subdivision 1, is amended to read:
163.24 		Subdivision 1.Certain counties may issue and sell. The county board of any 
163.25 	county having no outstanding road and bridge bonds may issue and sell county road bonds 
163.26 	in an amount not exceeding 0.12089 percent of the estimated market value of the taxable 
163.27 	property within the county exclusive of money and credits, for the purpose of constructing, 
163.28 	reconstructing, improving, or maintaining any bridge or bridges on any highway under its 
163.29 	jurisdiction, without submitting the matter to a vote of the electors of the county.

163.30 	Sec. 23. Minnesota Statutes 2010, section 272.03, is amended by adding a subdivision 
163.31 	to read:
163.32 		Subd. 14.Estimated market value. "Estimated market value" means the assessor's 
163.33 	determination of market value, including the effects of any orders made under section 
164.1 	270.12 or chapter 274, for the parcel. The provisions of section 273.032 apply for certain 
164.2 	uses in determining the total estimated market value for the taxing jurisdiction.

164.3 	Sec. 24. Minnesota Statutes 2010, section 272.03, is amended by adding a subdivision 
164.4 	to read:
164.5 		Subd. 15.Taxable market value. "Taxable market value" means estimated market 
164.6 	value for the parcel as reduced by market value exclusions, deferments of value, or other 
164.7 	adjustments, required by law, that reduce market value before the application of class rates.

164.8 	Sec. 25. Minnesota Statutes 2010, section 273.032, is amended to read:
164.9 	273.032 MARKET VALUE DEFINITION.
164.10 	(a) Unless otherwise provided, for the purpose of determining any property tax 
164.11 	levy limitation based on market value or any limit on net debt, the issuance of bonds, 
164.12 	certificates of indebtedness, or capital notes based on market value, any qualification to 
164.13 	receive state aid based on market value, or any state aid amount based on market value, 
164.14 	the terms "market value," "taxable estimated market value," and "market valuation," 
164.15 	whether equalized or unequalized, mean the total taxable estimated market value of 
164.16 	taxable property within the local unit of government before any of the following or 
164.17 	similar adjustments for:
164.18 	(1) the market value exclusions under:
164.19 	(i) section 273.11, subdivisions 14a and 14c (vacant platted land);
164.20 	(ii) section 273.11, subdivision 16 (certain improvements to homestead property);
164.21 	(iii) section 273.11, subdivisions 19 and 20 (certain improvements to business 
164.22 	properties);
164.23 	(iv) section 273.11, subdivision 21 (homestead property damaged by mold);
164.24 	(v) section 273.11, subdivision 22 (qualifying lead hazardous reduction projects);
164.25 	(vi) section 273.13, subdivision 34 (homestead of a disabled veteran, spouse, or 
164.26 	caregiver);
164.27 	(vii) section 273.13, subdivision 35 (homestead market value exclusion); or
164.28 	(2) the deferment of value under:
164.29 	(i) the Minnesota Agricultural Property Tax Law, section 273.111;
164.30 	(ii) the aggregate resource preservation law, section 273.1115;
164.31 	(iii) the Minnesota Open Space Property Tax Law, section 273.112;
164.32 	(iv) the rural preserves property tax program, section 273.114; or
164.33 	(v) the Metropolitan Agricultural Preserves Act, section 473H.10; or
164.34 	(3) the adjustments to tax capacity for:
165.1 	(i) tax increment, financing under sections 469.174 to 469.1794;
165.2 	(ii) fiscal disparity, disparities under chapter 276A or 473F; or
165.3 	(iii) powerline credit, or wind energy values, but after the limited market adjustments 
165.4 	under section 273.11, subdivision 1a, and after the market value exclusions of certain 
165.5 	improvements to homestead property under section 273.11, subdivision 16 under section 
165.6 	273.425.
165.7 	(b) Estimated market value under paragraph (a) also includes the market value 
165.8 	of tax exempt property if the applicable law specifically provides that the limitation, 
165.9 	qualification, or aid calculation includes tax exempt property.
165.10 	(c) Unless otherwise provided, "market value," "taxable estimated market value," 
165.11 	and "market valuation" for purposes of this paragraph  property tax levy limitations and 
165.12 	calculation of state aid, refer to the taxable estimated market value for the previous 
165.13 	assessment year and for purposes of limits on net debt, the issuance of bonds, certificates of 
165.14 	indebtedness, or capital notes refer to the estimated market value as last finally equalized.
165.15 	For the purpose of determining any net debt limit based on market value, or any limit 
165.16 	on the issuance of bonds, certificates of indebtedness, or capital notes based on market 
165.17 	value, the terms "market value," "taxable market value," and "market valuation," whether 
165.18 	equalized or unequalized, mean the total taxable market value of property within the local 
165.19 	unit of government before any adjustments for tax increment, fiscal disparity, powerline 
165.20 	credit, or wind energy values, but after the limited market value adjustments under section 
165.21 	273.11, subdivision 1a, and after the market value exclusions of certain improvements to 
165.22 	homestead property under section 273.11, subdivision 16. Unless otherwise provided, 
165.23 	"market value," "taxable market value," and "market valuation" for purposes of this 
165.24 	paragraph, mean the taxable market value as last finally equalized.
165.25 	(d) For purposes of a provision of a home rule charter or of any special law that is 
165.26 	not codified in the statutes and that imposes a levy limitation based on market value or 
165.27 	any limit on debt, the issuance of bonds, certificates of indebtedness, or capital notes 
165.28 	based on market value, the terms "market value," "taxable market value," and "market 
165.29 	valuation," whether equalized or unequalized, mean "estimated market value" as defined 
165.30 	in paragraph (a).

165.31 	Sec. 26. Minnesota Statutes 2010, section 273.11, subdivision 1, is amended to read:
165.32 		Subdivision 1.Generally. Except as provided in this section or section 273.17, 
165.33 	subdivision 1, all property shall be valued at its market value. The market value as 
165.34 	determined pursuant to this section shall be stated such that any amount under $100 is 
165.35 	rounded up to $100 and any amount exceeding $100 shall be rounded to the nearest $100. 
166.1 	In estimating and determining such value, the assessor shall not adopt a lower or different 
166.2 	standard of value because the same is to serve as a basis of taxation, nor shall the assessor 
166.3 	adopt as a criterion of value the price for which such property would sell at a forced sale, 
166.4 	or in the aggregate with all the property in the town or district; but the assessor shall value 
166.5 	each article or description of property by itself, and at such sum or price as the assessor 
166.6 	believes the same to be fairly worth in money. The assessor shall take into account the 
166.7 	effect on the market value of property of environmental factors in the vicinity of the 
166.8 	property. In assessing any tract or lot of real property, the value of the land, exclusive of 
166.9 	structures and improvements, shall be determined, and also the value of all structures and 
166.10 	improvements thereon, and the aggregate value of the property, including all structures 
166.11 	and improvements, excluding the value of crops growing upon cultivated land. In valuing 
166.12 	real property upon which there is a mine or quarry, it shall be valued at such price as such 
166.13 	property, including the mine or quarry, would sell for at a fair, voluntary sale, for cash, 
166.14 	if the material being mined or quarried is not subject to taxation under section 298.015
166.15 	and the mine or quarry is not exempt from the general property tax under section 298.25. 
166.16 	In valuing real property which is vacant, platted property shall be assessed as provided 
166.17 	in subdivision 14 subdivisions 14a and 14c. All property, or the use thereof, which is 
166.18 	taxable under section 272.01, subdivision 2, or 273.19, shall be valued at the market 
166.19 	value of such property and not at the value of a leasehold estate in such property, or at 
166.20 	some lesser value than its market value.

166.21 	Sec. 27. Minnesota Statutes 2010, section 273.124, subdivision 3a, is amended to read:
166.22 		Subd. 3a.Manufactured home park cooperative. (a) When a manufactured home 
166.23 	park is owned by a corporation or association organized under chapter 308A or 308B, 
166.24 	and each person who owns a share or shares in the corporation or association is entitled 
166.25 	to occupy a lot within the park, the corporation or association may claim homestead 
166.26 	treatment for the park. Each lot must be designated by legal description or number, and 
166.27 	each lot is limited to not more than one-half acre of land.
166.28 	(b) The manufactured home park shall be entitled to homestead treatment if all 
166.29 	of the following criteria are met:
166.30 	(1) the occupant or the cooperative corporation or association is paying the ad 
166.31 	valorem property taxes and any special assessments levied against the land and structure 
166.32 	either directly, or indirectly through dues to the corporation or association; and
166.33 	(2) the corporation or association organized under chapter 308A or 308B is wholly 
166.34 	owned by persons having a right to occupy a lot owned by the corporation or association.
167.1 	(c) A charitable corporation, organized under the laws of Minnesota with no 
167.2 	outstanding stock, and granted a ruling by the Internal Revenue Service for 501(c)(3) 
167.3 	tax-exempt status, qualifies for homestead treatment with respect to a manufactured home 
167.4 	park if its members hold residential participation warrants entitling them to occupy a lot 
167.5 	in the manufactured home park.
167.6 	(d) "Homestead treatment" under this subdivision means the class rate provided for 
167.7 	class 4c property classified under section 273.13, subdivision 25, paragraph (d), clause (5), 
167.8 	item (ii). The homestead market value credit exclusion under section 273.1384 273.13, 
167.9 	subdivision 35, does not apply and the property taxes assessed against the park shall not 
167.10 	be included in the determination of taxes payable for rent paid under section 290A.03.

167.11 	EFFECTIVE DATE. This section is effective for taxes payable in 2012 and 
167.12 	thereafter.

167.13 	Sec. 28. Minnesota Statutes 2010, section 273.124, subdivision 13, is amended to read:
167.14 		Subd. 13.Homestead application. (a) A person who meets the homestead 
167.15 	requirements under subdivision 1 must file a homestead application with the county 
167.16 	assessor to initially obtain homestead classification.
167.17 	(b) The format and contents of a uniform homestead application shall be prescribed 
167.18 	by the commissioner of revenue. The application must clearly inform the taxpayer that 
167.19 	this application must be signed by all owners who occupy the property or by the qualifying 
167.20 	relative and returned to the county assessor in order for the property to receive homestead 
167.21 	treatment.
167.22 	(c) Every property owner applying for homestead classification must furnish to the 
167.23 	county assessor the Social Security number of each occupant who is listed as an owner 
167.24 	of the property on the deed of record, the name and address of each owner who does not 
167.25 	occupy the property, and the name and Social Security number of each owner's spouse who 
167.26 	occupies the property. The application must be signed by each owner who occupies the 
167.27 	property and by each owner's spouse who occupies the property, or, in the case of property 
167.28 	that qualifies as a homestead under subdivision 1, paragraph (c), by the qualifying relative.
167.29 	If a property owner occupies a homestead, the property owner's spouse may not 
167.30 	claim another property as a homestead unless the property owner and the property owner's 
167.31 	spouse file with the assessor an affidavit or other proof required by the assessor stating that 
167.32 	the property qualifies as a homestead under subdivision 1, paragraph (e).
167.33 	Owners or spouses occupying residences owned by their spouses and previously 
167.34 	occupied with the other spouse, either of whom fail to include the other spouse's name 
167.35 	and Social Security number on the homestead application or provide the affidavits or 
168.1 	other proof requested, will be deemed to have elected to receive only partial homestead 
168.2 	treatment of their residence. The remainder of the residence will be classified as 
168.3 	nonhomestead residential. When an owner or spouse's name and Social Security number 
168.4 	appear on homestead applications for two separate residences and only one application is 
168.5 	signed, the owner or spouse will be deemed to have elected to homestead the residence for 
168.6 	which the application was signed.
168.7 	The Social Security numbers, state or federal tax returns or tax return information, 
168.8 	including the federal income tax schedule F required by this section, or affidavits or other 
168.9 	proofs of the property owners and spouses submitted under this or another section to 
168.10 	support a claim for a property tax homestead classification are private data on individuals 
168.11 	as defined by section 13.02, subdivision 12, but, notwithstanding that section, the private 
168.12 	data may be disclosed to the commissioner of revenue, or, for purposes of proceeding 
168.13 	under the Revenue Recapture Act to recover personal property taxes owing, to the county 
168.14 	treasurer.
168.15 	(d) If residential real estate is occupied and used for purposes of a homestead by a 
168.16 	relative of the owner and qualifies for a homestead under subdivision 1, paragraph (c), in 
168.17 	order for the property to receive homestead status, a homestead application must be filed 
168.18 	with the assessor. The Social Security number of each relative and spouse of a relative 
168.19 	occupying the property shall be required on the homestead application filed under this 
168.20 	subdivision. If a different relative of the owner subsequently occupies the property, the 
168.21 	owner of the property must notify the assessor within 30 days of the change in occupancy. 
168.22 	The Social Security number of a relative or relative's spouse occupying the property 
168.23 	is private data on individuals as defined by section 13.02, subdivision 12, but may be 
168.24 	disclosed to the commissioner of revenue, or, for the purposes of proceeding under the 
168.25 	Revenue Recapture Act to recover personal property taxes owing, to the county treasurer.
168.26 	(e) The homestead application shall also notify the property owners that the 
168.27 	application filed under this section will not be mailed annually and that if the property 
168.28 	is granted homestead status for any assessment year, that same property shall remain 
168.29 	classified as homestead until the property is sold or transferred to another person, or 
168.30 	the owners, the spouse of the owner, or the relatives no longer use the property as their 
168.31 	homestead. Upon the sale or transfer of the homestead property, a certificate of value must 
168.32 	be timely filed with the county auditor as provided under section 272.115. Failure to 
168.33 	notify the assessor within 30 days that the property has been sold, transferred, or that the 
168.34 	owner, the spouse of the owner, or the relative is no longer occupying the property as a 
168.35 	homestead, shall result in the penalty provided under this subdivision and the property 
168.36 	will lose its current homestead status.
169.1 	(f) If the homestead application is not returned within 30 days, the county will send a 
169.2 	second application to the present owners of record. The notice of proposed property taxes 
169.3 	prepared under section 275.065, subdivision 3, shall reflect the property's classification. If 
169.4 	a homestead application has not been filed with the county by December 15, the assessor 
169.5 	shall classify the property as nonhomestead for the current assessment year for taxes 
169.6 	payable in the following year, provided that the owner may be entitled to receive the 
169.7 	homestead classification by proper application under section 375.192.
169.8 	(g) At the request of the commissioner, each county must give the commissioner a 
169.9 	list that includes the name and Social Security number of each occupant of homestead 
169.10 	property who is the property owner, property owner's spouse, qualifying relative of a 
169.11 	property owner, or a spouse of a qualifying relative. The commissioner shall use the 
169.12 	information provided on the lists as appropriate under the law, including for the detection 
169.13 	of improper claims by owners, or relatives of owners, under chapter 290A.
169.14 	(h) If the commissioner finds that a property owner may be claiming a fraudulent 
169.15 	homestead, the commissioner shall notify the appropriate counties. Within 90 days of 
169.16 	the notification, the county assessor shall investigate to determine if the homestead 
169.17 	classification was properly claimed. If the property owner does not qualify, the county 
169.18 	assessor shall notify the county auditor who will determine the amount of homestead 
169.19 	benefits that had been improperly allowed. For the purpose of this section, "homestead 
169.20 	benefits" means the tax reduction resulting from the classification as a homestead and the 
169.21 	homestead market value exclusion under section 273.13, the taconite homestead credit 
169.22 	under section 273.135, the residential homestead and agricultural homestead credits credit
169.23 	under section 273.1384, and the supplemental homestead credit under section 273.1391.
169.24 	The county auditor shall send a notice to the person who owned the affected property 
169.25 	at the time the homestead application related to the improper homestead was filed, 
169.26 	demanding reimbursement of the homestead benefits plus a penalty equal to 100 percent 
169.27 	of the homestead benefits. The person notified may appeal the county's determination 
169.28 	by serving copies of a petition for review with county officials as provided in section 
169.29 	278.01 and filing proof of service as provided in section 278.01 with the Minnesota Tax 
169.30 	Court within 60 days of the date of the notice from the county. Procedurally, the appeal 
169.31 	is governed by the provisions in chapter 271 which apply to the appeal of a property tax 
169.32 	assessment or levy, but without requiring any prepayment of the amount in controversy. If 
169.33 	the amount of homestead benefits and penalty is not paid within 60 days, and if no appeal 
169.34 	has been filed, the county auditor shall certify the amount of taxes and penalty to the county 
169.35 	treasurer. The county treasurer will add interest to the unpaid homestead benefits and 
169.36 	penalty amounts at the rate provided in section 279.03 for real property taxes becoming 
170.1 	delinquent in the calendar year during which the amount remains unpaid. Interest may be 
170.2 	assessed for the period beginning 60 days after demand for payment was made.
170.3 	If the person notified is the current owner of the property, the treasurer may add the 
170.4 	total amount of homestead benefits, penalty, interest, and costs to the ad valorem taxes 
170.5 	otherwise payable on the property by including the amounts on the property tax statements 
170.6 	under section 276.04, subdivision 3. The amounts added under this paragraph to the ad 
170.7 	valorem taxes shall include interest accrued through December 31 of the year preceding 
170.8 	the taxes payable year for which the amounts are first added. These amounts, when added 
170.9 	to the property tax statement, become subject to all the laws for the enforcement of real or 
170.10 	personal property taxes for that year, and for any subsequent year.
170.11 	If the person notified is not the current owner of the property, the treasurer may 
170.12 	collect the amounts due under the Revenue Recapture Act in chapter 270A, or use any of 
170.13 	the powers granted in sections 277.20 and 277.21 without exclusion, to enforce payment 
170.14 	of the homestead benefits, penalty, interest, and costs, as if those amounts were delinquent 
170.15 	tax obligations of the person who owned the property at the time the application related 
170.16 	to the improperly allowed homestead was filed. The treasurer may relieve a prior owner 
170.17 	of personal liability for the homestead benefits, penalty, interest, and costs, and instead 
170.18 	extend those amounts on the tax lists against the property as provided in this paragraph 
170.19 	to the extent that the current owner agrees in writing. On all demands, billings, property 
170.20 	tax statements, and related correspondence, the county must list and state separately the 
170.21 	amounts of homestead benefits, penalty, interest and costs being demanded, billed or 
170.22 	assessed.
170.23 	(i) Any amount of homestead benefits recovered by the county from the property 
170.24 	owner shall be distributed to the county, city or town, and school district where the 
170.25 	property is located in the same proportion that each taxing district's levy was to the total 
170.26 	of the three taxing districts' levy for the current year. Any amount recovered attributable 
170.27 	to taconite homestead credit shall be transmitted to the St. Louis County auditor to be 
170.28 	deposited in the taconite property tax relief account. Any amount recovered that is 
170.29 	attributable to supplemental homestead credit is to be transmitted to the commissioner of 
170.30 	revenue for deposit in the general fund of the state treasury. The total amount of penalty 
170.31 	collected must be deposited in the county general fund.
170.32 	(j) If a property owner has applied for more than one homestead and the county 
170.33 	assessors cannot determine which property should be classified as homestead, the county 
170.34 	assessors will refer the information to the commissioner. The commissioner shall make 
170.35 	the determination and notify the counties within 60 days.
171.1 	(k) In addition to lists of homestead properties, the commissioner may ask the 
171.2 	counties to furnish lists of all properties and the record owners. The Social Security 
171.3 	numbers and federal identification numbers that are maintained by a county or city 
171.4 	assessor for property tax administration purposes, and that may appear on the lists retain 
171.5 	their classification as private or nonpublic data; but may be viewed, accessed, and used by 
171.6 	the county auditor or treasurer of the same county for the limited purpose of assisting the 
171.7 	commissioner in the preparation of microdata samples under section 270C.12.
171.8 	(l) On or before April 30 each year beginning in 2007, each county must provide the 
171.9 	commissioner with the following data for each parcel of homestead property by electronic 
171.10 	means as defined in section 289A.02, subdivision 8:
171.11 	(i) the property identification number assigned to the parcel for purposes of taxes 
171.12 	payable in the current year;
171.13 	(ii) the name and Social Security number of each occupant of homestead property 
171.14 	who is the property owner, property owner's spouse, qualifying relative of a property 
171.15 	owner, or spouse of a qualifying relative;
171.16 	(iii) the classification of the property under section 273.13 for taxes payable in the 
171.17 	current year and in the prior year;
171.18 	(iv) an indication of whether the property was classified as a homestead for taxes 
171.19 	payable in the current year because of occupancy by a relative of the owner or by a 
171.20 	spouse of a relative;
171.21 	(v) the property taxes payable as defined in section 290A.03, subdivision 13, for the 
171.22 	current year and the prior year;
171.23 	(vi) the market value of improvements to the property first assessed for tax purposes 
171.24 	for taxes payable in the current year;
171.25 	(vii) the assessor's estimated market value assigned to the property for taxes payable 
171.26 	in the current year and the prior year;
171.27 	(viii) the taxable market value assigned to the property for taxes payable in the 
171.28 	current year and the prior year;
171.29 	(ix) whether there are delinquent property taxes owing on the homestead;
171.30 	(x) the unique taxing district in which the property is located; and
171.31 	(xi) such other information as the commissioner decides is necessary.
171.32 	The commissioner shall use the information provided on the lists as appropriate 
171.33 	under the law, including for the detection of improper claims by owners, or relatives 
171.34 	of owners, under chapter 290A.

171.35 	EFFECTIVE DATE. This section is effective for taxes payable in 2012 and 
171.36 	thereafter.

172.1 	Sec. 29. Minnesota Statutes 2010, section 273.13, subdivision 21b, is amended to read:
172.2 		Subd. 21b.Net tax capacity. (a) Gross tax capacity means the product of the 
172.3 	appropriate gross class rates in this section and market values.
172.4 	(b) Net tax capacity means the product of the appropriate net class rates in this 
172.5 	section and taxable market values.

172.6 	EFFECTIVE DATE. This section is effective the day following final enactment.

172.7 	Sec. 30. Minnesota Statutes 2010, section 273.1398, subdivision 3, is amended to read:
172.8 		Subd. 3.Disparity reduction aid.  The amount of disparity aid certified for each 
172.9 	taxing district within each unique taxing jurisdiction for taxes payable in the prior year 
172.10 	shall be multiplied by the ratio of (1) the jurisdiction's tax capacity using the class rates for 
172.11 	taxes payable in the year for which aid is being computed, to (2) its tax capacity using 
172.12 	the class rates for taxes payable in the year prior to that for which aid is being computed, 
172.13 	both based upon taxable market values for taxes payable in the year prior to that for which 
172.14 	aid is being computed. If the commissioner determines that insufficient information is 
172.15 	available to reasonably and timely calculate the numerator in this ratio for the first taxes 
172.16 	payable year that a class rate change or new class rate is effective, the commissioner shall 
172.17 	omit the effects of that class rate change or new class rate when calculating this ratio for 
172.18 	aid payable in that taxes payable year. For aid payable in the year following a year for 
172.19 	which such omission was made, the commissioner shall use in the denominator for the 
172.20 	class that was changed or created, the tax capacity for taxes payable two years prior to that 
172.21 	in which the aid is payable, based on taxable market values for taxes payable in the year 
172.22 	prior to that for which aid is being computed.

172.23 	Sec. 31. Minnesota Statutes 2010, section 273.1398, subdivision 4, is amended to read:
172.24 		Subd. 4.Disparity reduction credit. (a) Beginning with taxes payable in 1989, 
172.25 	class 4a, class 3a, and class 3b property qualifies for a disparity reduction credit if: (1) 
172.26 	the property is located in a border city that has an enterprise zone designated pursuant 
172.27 	to section 469.168, subdivision 4; (2) the property is located in a city with a population 
172.28 	greater than 2,500 and less than 35,000 according to the 1980 decennial census; (3) the 
172.29 	city is adjacent to a city in another state or immediately adjacent to a city adjacent to a city 
172.30 	in another state; and (4) the adjacent city in the other state has a population of greater than 
172.31 	5,000 and less than 75,000 according to the 1980 decennial census.
172.32 	(b) The credit is an amount sufficient to reduce (i) the taxes levied on class 4a 
172.33 	property to 2.3 percent of the property's taxable market value and (ii) the tax on class 3a 
172.34 	and class 3b property to 2.3 percent of taxable market value.
173.1 	(c) The county auditor shall annually certify the costs of the credits to the 
173.2 	Department of Revenue. The department shall reimburse local governments for the 
173.3 	property taxes forgone as the result of the credits in proportion to their total levies.

173.4 	Sec. 32. Minnesota Statutes 2010, section 275.011, subdivision 1, is amended to read:
173.5 		Subdivision 1.Determination of levy limit. The property tax levied for any 
173.6 	purpose under a special law that is not codified in Minnesota Statutes or a city charter 
173.7 	provision and that is subject to a mill rate limitation imposed by the special law or city 
173.8 	charter provision, excluding levies subject to mill rate limitations that use adjusted 
173.9 	assessed values determined by the commissioner of revenue under section 124.2131, must 
173.10 	not exceed the following amount for the years specified:
173.11 	(a) for taxes payable in 1988, the product of the applicable mill rate limitation 
173.12 	imposed by special law or city charter provision multiplied by the total assessed valuation 
173.13 	of all taxable property subject to the tax as adjusted by the provisions of Minnesota 
173.14 	Statutes 1986, sections 272.64; 273.13, subdivision 7a; and 275.49;
173.15 	(b) for taxes payable in 1989, the product of (1) the property tax levy limitation for 
173.16 	the taxes payable year 1988 determined under clause (a) multiplied by (2) an index for 
173.17 	market valuation changes equal to the assessment year 1988 total market valuation of all 
173.18 	taxable property subject to the tax divided by the assessment year 1987 total market 
173.19 	valuation of all taxable property subject to the tax; and
173.20 	(c) for taxes payable in 1990 and subsequent years, the product of (1) the property 
173.21 	tax levy limitation for the previous year determined pursuant to this subdivision multiplied 
173.22 	by (2) an index for market valuation changes equal to the total market valuation of all 
173.23 	taxable property subject to the tax for the current assessment year divided by the total 
173.24 	market valuation of all taxable property subject to the tax for the previous assessment year.
173.25 	For the purpose of determining the property tax levy limitation for the taxes payable 
173.26 	year 1988 2013 and subsequent years under this subdivision, "total market valuation" 
173.27 	means the total estimated market valuation value of all taxable property subject to the 
173.28 	tax without valuation adjustments for fiscal disparities (chapters 276A and 473F), tax 
173.29 	increment financing (sections 469.174 to 469.179), or powerline credit (section 273.425)
173.30 	as provided under section 273.032.

173.31 	Sec. 33. Minnesota Statutes 2010, section 275.077, subdivision 2, is amended to read:
173.32 		Subd. 2.Correction of levy amount. The difference between the correct levy and 
173.33 	the erroneous levy shall be added to the township levy for the subsequent levy year; 
173.34 	provided that if the amount of the difference exceeds 0.12089 percent of taxable estimated
174.1 	market value, the excess shall be added to the township levy for the second and later 
174.2 	subsequent levy years, not to exceed an additional levy of 0.12089 percent of taxable
174.3 	estimated market value in any year, until the full amount of the difference has been levied. 
174.4 	The funds collected from the corrected levies shall be used to reimburse the county for the 
174.5 	payment required by subdivision 1.

174.6 	Sec. 34. Minnesota Statutes 2010, section 275.71, subdivision 4, is amended to read:
174.7 		Subd. 4.Adjusted levy limit base.  For taxes levied in 2008 through 2010, the 
174.8 	adjusted levy limit base is equal to the levy limit base computed under subdivision 2 
174.9 	or section 275.72, multiplied by:
174.10 	(1) one plus the percentage growth in the implicit price deflator, but the percentage 
174.11 	shall not be less than zero or exceed 3.9 percent;
174.12 	(2) one plus a percentage equal to 50 percent of the percentage increase in the number 
174.13 	of households, if any, for the most recent 12-month period for which data is available; and
174.14 	(3) one plus a percentage equal to 50 percent of the percentage increase in the 
174.15 	taxable estimated market value of the jurisdiction due to new construction of class 3 
174.16 	property, as defined in section 273.13, subdivision 4, except for state-assessed utility and 
174.17 	railroad property, for the most recent year for which data is available.

174.18 	Sec. 35. Minnesota Statutes 2011 Supplement, section 276.04, subdivision 2, is 
174.19 	amended to read:
174.20 		Subd. 2.Contents of tax statements. (a) The treasurer shall provide for the 
174.21 	printing of the tax statements. The commissioner of revenue shall prescribe the form of 
174.22 	the property tax statement and its contents. The tax statement must not state or imply 
174.23 	that property tax credits are paid by the state of Minnesota. The statement must contain 
174.24 	a tabulated statement of the dollar amount due to each taxing authority and the amount 
174.25 	of the state tax from the parcel of real property for which a particular tax statement is 
174.26 	prepared. The dollar amounts attributable to the county, the state tax, the voter approved 
174.27 	school tax, the other local school tax, the township or municipality, and the total of 
174.28 	the metropolitan special taxing districts as defined in section 275.065, subdivision 3, 
174.29 	paragraph (i), must be separately stated. The amounts due all other special taxing districts, 
174.30 	if any, may be aggregated except that any levies made by the regional rail authorities in the 
174.31 	county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 
174.32 	398A shall be listed on a separate line directly under the appropriate county's levy. If the 
174.33 	county levy under this paragraph includes an amount for a lake improvement district as 
174.34 	defined under sections 103B.501 to 103B.581, the amount attributable for that purpose 
175.1 	must be separately stated from the remaining county levy amount. In the case of Ramsey 
175.2 	County, if the county levy under this paragraph includes an amount for public library 
175.3 	service under section 134.07, the amount attributable for that purpose may be separated 
175.4 	from the remaining county levy amount. The amount of the tax on homesteads qualifying 
175.5 	under the senior citizens' property tax deferral program under chapter 290B is the total 
175.6 	amount of property tax before subtraction of the deferred property tax amount. The 
175.7 	amount of the tax on contamination value imposed under sections 270.91 to 270.98, if any, 
175.8 	must also be separately stated. The dollar amounts, including the dollar amount of any 
175.9 	special assessments, may be rounded to the nearest even whole dollar. For purposes of this 
175.10 	section whole odd-numbered dollars may be adjusted to the next higher even-numbered 
175.11 	dollar. The amount of market value excluded under section 273.11, subdivision 16, if any, 
175.12 	must also be listed on the tax statement.
175.13 	(b) The property tax statements for manufactured homes and sectional structures 
175.14 	taxed as personal property shall contain the same information that is required on the 
175.15 	tax statements for real property.
175.16 	(c) Real and personal property tax statements must contain the following information 
175.17 	in the order given in this paragraph. The information must contain the current year tax 
175.18 	information in the right column with the corresponding information for the previous year 
175.19 	in a column on the left:
175.20 	(1) the property's estimated market value under section 273.11, subdivision 1;
175.21 	(2) the property's homestead market value exclusion under section 273.13, 
175.22 	subdivision 35;
175.23 	(3) the property's taxable market value after reductions under sections 273.11, 
175.24 	subdivisions 1a and 16, and 273.13, subdivision 35 section 272.03, subdivision 15;
175.25 	(4) the property's gross tax, before credits;
175.26 	(5) for homestead agricultural properties, the credit under section 273.1384;
175.27 	(6) any credits received under sections 273.119; 273.1234 or 273.1235; 273.135; 
175.28 	273.1391; 273.1398, subdivision 4; 469.171; and 473H.10, except that the amount of 
175.29 	credit received under section 273.135 must be separately stated and identified as "taconite 
175.30 	tax relief"; and
175.31 	(7) the net tax payable in the manner required in paragraph (a).
175.32 	(d) If the county uses envelopes for mailing property tax statements and if the county 
175.33 	agrees, a taxing district may include a notice with the property tax statement notifying 
175.34 	taxpayers when the taxing district will begin its budget deliberations for the current 
175.35 	year, and encouraging taxpayers to attend the hearings. If the county allows notices to 
175.36 	be included in the envelope containing the property tax statement, and if more than 
176.1 	one taxing district relative to a given property decides to include a notice with the tax 
176.2 	statement, the county treasurer or auditor must coordinate the process and may combine 
176.3 	the information on a single announcement.

176.4 	Sec. 36. Minnesota Statutes 2010, section 276A.01, subdivision 10, is amended to read:
176.5 		Subd. 10.Adjusted market value. "Adjusted market value" of real and personal 
176.6 	property within a municipality means the assessor's estimated taxable market value, 
176.7 	as defined in section 272.03, of all real and personal property, including the value of 
176.8 	manufactured housing, within the municipality. For purposes of sections 276A.01 to 
176.9 	276A.09, the commissioner of revenue shall annually make determinations and reports 
176.10 	with respect to each municipality which are comparable to those it makes for school 
176.11 	districts, adjusted for sales ratios in a manner similar to the adjustments made to city and 
176.12 	town net tax capacities under section 127A.48, subdivisions 1 to 6, in the same manner 
176.13 	and at the same times prescribed by the subdivision. The commissioner of revenue shall 
176.14 	annually determine, for each municipality, information comparable to that required by 
176.15 	section 475.53, subdivision 4, for school districts, as soon as practicable after it becomes 
176.16 	available. The commissioner of revenue shall then compute the equalized market value of 
176.17 	property within each municipality.

176.18 	EFFECTIVE DATE. This section is effective the day following final enactment.

176.19 	Sec. 37. Minnesota Statutes 2010, section 276A.01, subdivision 12, is amended to read:
176.20 		Subd. 12.Fiscal capacity. "Fiscal capacity" of a municipality means its valuation
176.21 	adjusted market value, determined as of January 2 of any year, divided by its population, 
176.22 	determined as of a date in the same year.

176.23 	Sec. 38. Minnesota Statutes 2010, section 276A.01, subdivision 13, is amended to read:
176.24 		Subd. 13.Average fiscal capacity. "Average fiscal capacity" of municipalities 
176.25 	means the sum of the valuations adjusted market values of all municipalities, determined 
176.26 	as of January 2 of any year, divided by the sum of their populations, determined as of 
176.27 	a date in the same year.

176.28 	Sec. 39. Minnesota Statutes 2010, section 276A.01, subdivision 15, is amended to read:
176.29 		Subd. 15.Net tax capacity. "Net tax capacity" means the taxable market value of 
176.30 	real and personal property multiplied by its net tax capacity rates in section 273.13.

177.1 	Sec. 40. Minnesota Statutes 2010, section 287.08, is amended to read:
177.2 	287.08 TAX, HOW PAYABLE; RECEIPTS.
177.3 	(a) The tax imposed by sections 287.01 to 287.12 must be paid to the treasurer of 
177.4 	any county in this state in which the real property or some part is located at or before 
177.5 	the time of filing the mortgage for record. The treasurer shall endorse receipt on the 
177.6 	mortgage and the receipt is conclusive proof that the tax has been paid in the amount 
177.7 	stated and authorizes any county recorder or registrar of titles to record the mortgage. Its 
177.8 	form, in substance, shall be "registration tax hereon of ..................... dollars paid." If the 
177.9 	mortgage is exempt from taxation the endorsement shall, in substance, be "exempt from 
177.10 	registration tax." In either case the receipt must be signed by the treasurer. In case the 
177.11 	treasurer is unable to determine whether a claim of exemption should be allowed, the tax 
177.12 	must be paid as in the case of a taxable mortgage. For documents submitted electronically, 
177.13 	the endorsements and tax amount shall be affixed electronically and no signature by the 
177.14 	treasurer will be required. The actual payment method must be arranged in advance 
177.15 	between the submitter and the receiving county.
177.16 	(b) The county treasurer may refund in whole or in part any mortgage registry tax 
177.17 	overpayment if a written application by the taxpayer is submitted to the county treasurer 
177.18 	within 3-1/2 years from the date of the overpayment. If the county has not issued a denial 
177.19 	of the application, the taxpayer may bring an action in Tax Court in the county in which 
177.20 	the tax was paid at any time after the expiration of six months from the time that the 
177.21 	application was submitted. A denial of refund may be appealed within 60 days from 
177.22 	the date of the denial by bringing an action in Tax Court in the county in which the tax 
177.23 	was paid. The action is commenced by the serving of a petition for relief on the county 
177.24 	treasurer, and by filing a copy with the court. The county attorney shall defend the action. 
177.25 	The county treasurer shall notify the treasurer of each county that has or would receive a 
177.26 	portion of the tax as paid.
177.27 	(c) If the county treasurer determines a refund should be paid, or if a refund is 
177.28 	ordered by the court, the county treasurer of each county that actually received a portion 
177.29 	of the tax shall immediately pay a proportionate share of three percent of the refund 
177.30 	using any available county funds. The county treasurer of each county that received, or 
177.31 	would have received, a portion of the tax shall also pay their county's proportionate share 
177.32 	of the remaining 97 percent of the court-ordered refund on or before the 20th day of the 
177.33 	following month using solely the mortgage registry tax funds that would be paid to the 
177.34 	commissioner of revenue on that date under section 287.12. If the funds on hand under 
177.35 	this procedure are insufficient to fully fund 97 percent of the court-ordered refund, the 
177.36 	county treasurer of the county in which the action was brought shall file a claim with the 
178.1 	commissioner of revenue under section 16A.48 for the remaining portion of 97 percent of 
178.2 	the refund, and shall pay over the remaining portion upon receipt of a warrant from the 
178.3 	state issued pursuant to the claim.
178.4 	(d) When any mortgage covers real property located in more than one county in this 
178.5 	state the total tax must be paid to the treasurer of the county where the mortgage is first 
178.6 	presented for recording, and the payment must be receipted as provided in paragraph 
178.7 	(a). If the principal debt or obligation secured by such a multiple county mortgage 
178.8 	exceeds $10,000,000, the nonstate portion of the tax must be divided and paid over by 
178.9 	the county treasurer receiving it, on or before the 20th day of each month after receipt, 
178.10 	to the county or counties entitled in the ratio that the estimated market value of the real 
178.11 	property covered by the mortgage in each county bears to the estimated market value of 
178.12 	all the real property in this state described in the mortgage. In making the division and 
178.13 	payment the county treasurer shall send a statement giving the description of the real 
178.14 	property described in the mortgage and the estimated market value of the part located in 
178.15 	each county. For this purpose, the treasurer of any county may require the treasurer of 
178.16 	any other county to certify to the former the estimated market valuation value of any tract 
178.17 	of real property in any mortgage.
178.18 	(e) The mortgagor must pay the tax imposed by sections 287.01 to 287.12. The 
178.19 	mortgagee may undertake to collect and remit the tax on behalf of the mortgagor. If the 
178.20 	mortgagee collects money from the mortgagor to remit the tax on behalf of the mortgagor, 
178.21 	the mortgagee has a fiduciary duty to remit the tax on behalf of the mortgagor as to the 
178.22 	amount of the tax collected for that purpose and the mortgagor is relieved of any further 
178.23 	obligation to pay the tax as to the amount collected by the mortgagee for this purpose.

178.24 	Sec. 41. Minnesota Statutes 2010, section 287.23, subdivision 1, is amended to read:
178.25 		Subdivision 1.Real property outside county. If any taxable deed or instrument 
178.26 	describes any real property located in more than one county in this state, the total tax must 
178.27 	be paid to the treasurer of the county where the document is first presented for recording, 
178.28 	and the payment must be receipted as provided in section 287.08. If the net consideration 
178.29 	exceeds $700,000, the nonstate portion of the tax must be divided and paid over by the 
178.30 	county treasurer receiving it, on or before the 20th day of each month after receipt, to 
178.31 	the county or counties entitled in the ratio which the estimated market value of the real 
178.32 	property covered by the document in each county bears to the estimated market value of 
178.33 	all the real property in this state described in the document. In making the division and 
178.34 	payment the county treasurer shall send a statement to the other involved counties giving 
178.35 	the description of the real property described in the document and the estimated market 
179.1 	value of the part located in each county. The treasurer of any county may require the 
179.2 	treasurer of any other county to certify to the former the estimated market valuation value
179.3 	of any parcel of real property for this purpose.

179.4 	Sec. 42. Minnesota Statutes 2010, section 353G.08, subdivision 2, is amended to read:
179.5 		Subd. 2.Cash flow funding requirement. If the executive director determines that 
179.6 	an account in the voluntary statewide lump-sum volunteer firefighter retirement plan has 
179.7 	insufficient assets to meet the service pensions determined payable from the account, 
179.8 	the executive director shall certify the amount of the potential service pension shortfall 
179.9 	to the municipality or municipalities and the municipality or municipalities shall make 
179.10 	an additional employer contribution to the account within ten days of the certification. 
179.11 	If more than one municipality is associated with the account, unless the municipalities 
179.12 	agree to a different allocation, the municipalities shall allocate the additional employer 
179.13 	contribution one-half in proportion to the population of each municipality and one-half in 
179.14 	proportion to the estimated market value of the property of each municipality.

179.15 	Sec. 43. Minnesota Statutes 2010, section 365.025, subdivision 4, is amended to read:
179.16 		Subd. 4.Major purchases: notice, petition, election. Before buying anything 
179.17 	under subdivision 2 that costs more than 0.24177 percent of the estimated market value of 
179.18 	the town, the town must follow this subdivision.
179.19 	The town must publish in its official newspaper the board's resolution to pay for the 
179.20 	property over time. Then a petition for an election on the contract may be filed with the 
179.21 	clerk. The petition must be filed within ten days after the resolution is published. To 
179.22 	require the election the petition must be signed by a number of voters equal to ten percent 
179.23 	of the voters at the last regular town election. The contract then must be approved by a 
179.24 	majority of those voting on the question. The question may be voted on at a regular 
179.25 	or special election.

179.26 	Sec. 44. Minnesota Statutes 2010, section 366.095, subdivision 1, is amended to read:
179.27 		Subdivision 1.Certificates of indebtedness. The town board may issue certificates 
179.28 	of indebtedness within the debt limits for a town purpose otherwise authorized by law. 
179.29 	The certificates shall be payable in not more than ten years and be issued on the terms and 
179.30 	in the manner as the board may determine. If the amount of the certificates to be issued 
179.31 	exceeds 0.25 percent of the estimated market value of the town, they shall not be issued 
179.32 	for at least ten days after publication in a newspaper of general circulation in the town of 
179.33 	the board's resolution determining to issue them. If within that time, a petition asking for 
180.1 	an election on the proposition signed by voters equal to ten percent of the number of voters 
180.2 	at the last regular town election is filed with the clerk, the certificates shall not be issued 
180.3 	until their issuance has been approved by a majority of the votes cast on the question at 
180.4 	a regular or special election. A tax levy shall be made to pay the principal and interest 
180.5 	on the certificates as in the case of bonds.

180.6 	Sec. 45. Minnesota Statutes 2010, section 366.27, is amended to read:
180.7 	366.27 FIREFIGHTERS' RELIEF; TAX LEVY.
180.8 	The town board of any town in this state having therein a platted portion on 
180.9 	which resides 1,200 or more people, and wherein a duly incorporated firefighters' relief 
180.10 	association is located may each year levy a tax not to exceed 0.00806 percent of taxable
180.11 	estimated market value for the benefit of the relief association.

180.12 	Sec. 46. Minnesota Statutes 2010, section 368.01, subdivision 23, is amended to read:
180.13 		Subd. 23.Financing purchase of certain equipment. The town board may issue 
180.14 	certificates of indebtedness within debt limits to purchase fire or police equipment or 
180.15 	ambulance equipment or street construction or maintenance equipment. The certificates 
180.16 	shall be payable in not more than five years and be issued on terms and in the manner 
180.17 	as the board may determine. If the amount of the certificates to be issued to finance a 
180.18 	purchase exceeds 0.24177 percent of the estimated market value of the town, excluding 
180.19 	money and credits, they shall not be issued for at least ten days after publication in the 
180.20 	official newspaper of a town board resolution determining to issue them. If before the end 
180.21 	of that time, a petition asking for an election on the proposition signed by voters equal 
180.22 	to ten percent of the number of voters at the last regular town election is filed with the 
180.23 	clerk, the certificates shall not be issued until the proposition of their issuance has been 
180.24 	approved by a majority of the votes cast on the question at a regular or special election. 
180.25 	A tax levy shall be made for the payment of the principal and interest on the certificates 
180.26 	as in the case of bonds.

180.27 	Sec. 47. Minnesota Statutes 2010, section 368.47, is amended to read:
180.28 	368.47 TOWNS MAY BE DISSOLVED.
180.29 	(1) When the voters residing within a town have failed to elect any town officials for 
180.30 	more than ten years continuously;
180.31 	(2) when a town has failed for a period of ten years to exercise any of the powers 
180.32 	and functions of a town;
180.33 	(3) when the estimated market value of a town drops to less than $165,000;
181.1 	(4) when the tax delinquency of a town, exclusive of taxes that are delinquent or 
181.2 	unpaid because they are contested in proceedings for the enforcement of taxes, amounts to 
181.3 	12 percent of its market value; or
181.4 	(5) when the state or federal government has acquired title to 50 percent of the 
181.5 	real estate of a town,
181.6 	which facts, or any of them, may be found and determined by the resolution of the county 
181.7 	board of the county in which the town is located, according to the official records in the 
181.8 	office of the county auditor, the county board by resolution may declare the town, naming 
181.9 	it, dissolved and no longer entitled to exercise any of the powers or functions of a town.
181.10 	In Cass, Itasca, and St. Louis Counties, before the dissolution is effective the voters 
181.11 	of the town shall express their approval or disapproval. The town clerk shall, upon a 
181.12 	petition signed by a majority of the registered voters of the town, filed with the clerk at 
181.13 	least 60 days before a regular or special town election, give notice at the same time and 
181.14 	in the same manner of the election that the question of dissolution of the town will be 
181.15 	submitted for determination at the election. At the election the question shall be voted 
181.16 	upon by a separate ballot, the terms of which shall be either "for dissolution" or "against 
181.17 	dissolution." The ballot shall be deposited in a separate ballot box and the result of the 
181.18 	voting canvassed, certified, and returned in the same manner and at the same time as 
181.19 	other facts and returns of the election. If a majority of the votes cast at the election are 
181.20 	for dissolution, the town shall be dissolved. If a majority of the votes cast at the election 
181.21 	are against dissolution, the town shall not be dissolved.
181.22 	When a town is dissolved under sections 368.47 to 368.49 the county shall acquire 
181.23 	title to any telephone company or other business conducted by the town. The business 
181.24 	shall be operated by the board of county commissioners until it can be sold. The 
181.25 	subscribers or patrons of the business shall have the first opportunity of purchase. If the 
181.26 	town has any outstanding indebtedness chargeable to the business, the county auditor shall 
181.27 	levy a tax against the property situated in the dissolved town to pay the indebtedness 
181.28 	as it becomes due.

181.29 	Sec. 48. Minnesota Statutes 2010, section 370.01, is amended to read:
181.30 	370.01 CHANGE OF BOUNDARIES; CREATION OF NEW COUNTIES.
181.31 	The boundaries of counties may be changed by taking territory from a county and 
181.32 	attaching it to an adjoining county, and new counties may be established out of territory of 
181.33 	one or more existing counties. A new county shall contain at least 400 square miles and 
181.34 	have at least 4,000 inhabitants. A proposed new county must have a total taxable estimated
181.35 	market value of at least 35 percent of (i) the total taxable estimated market value of the 
182.1 	existing county, or (ii) the average total taxable estimated market value of the existing 
182.2 	counties, included in the proposition. The determination of the taxable estimated market 
182.3 	value of a county must be made by the commissioner of revenue. An existing county shall 
182.4 	not be reduced in area below 400 square miles, have less than 4,000 inhabitants, or have a 
182.5 	total taxable estimated market value of less than that required of a new county.
182.6 	No change in the boundaries of any county having an area of more than 2,500 square 
182.7 	miles, whether by the creation of a new county, or otherwise, shall detach from the existing 
182.8 	county any territory within 12 miles of the county seat.

182.9 	Sec. 49. Minnesota Statutes 2010, section 373.40, subdivision 1, is amended to read:
182.10 		Subdivision 1.Definitions. For purposes of this section, the following terms have 
182.11 	the meanings given.
182.12 	(a) "Bonds" means an obligation as defined under section 475.51.
182.13 	(b) "Capital improvement" means acquisition or betterment of public lands, 
182.14 	buildings, or other improvements within the county for the purpose of a county courthouse, 
182.15 	administrative building, health or social service facility, correctional facility, jail, law 
182.16 	enforcement center, hospital, morgue, library, park, qualified indoor ice arena, roads and 
182.17 	bridges, and the acquisition of development rights in the form of conservation easements 
182.18 	under chapter 84C. An improvement must have an expected useful life of five years or 
182.19 	more to qualify. "Capital improvement" does not include a recreation or sports facility 
182.20 	building (such as, but not limited to, a gymnasium, ice arena, racquet sports facility, 
182.21 	swimming pool, exercise room or health spa), unless the building is part of an outdoor 
182.22 	park facility and is incidental to the primary purpose of outdoor recreation.
182.23 	(c) "Metropolitan county" means a county located in the seven-county metropolitan 
182.24 	area as defined in section 473.121 or a county with a population of 90,000 or more.
182.25 	(d) "Population" means the population established by the most recent of the 
182.26 	following (determined as of the date the resolution authorizing the bonds was adopted):
182.27 	(1) the federal decennial census,
182.28 	(2) a special census conducted under contract by the United States Bureau of the 
182.29 	Census, or
182.30 	(3) a population estimate made either by the Metropolitan Council or by the state 
182.31 	demographer under section 4A.02.
182.32 	(e) "Qualified indoor ice arena" means a facility that meets the requirements of 
182.33 	section 373.43.
182.34 	(f) "Tax capacity" means total taxable market value, but does not include captured 
182.35 	market value.

183.1 	Sec. 50. Minnesota Statutes 2010, section 373.40, subdivision 4, is amended to read:
183.2 		Subd. 4.Limitations on amount. A county may not issue bonds under this section 
183.3 	if the maximum amount of principal and interest to become due in any year on all the 
183.4 	outstanding bonds issued pursuant to this section (including the bonds to be issued) will 
183.5 	equal or exceed 0.12 percent of taxable the estimated market value of property in the 
183.6 	county. Calculation of the limit must be made using the taxable estimated market value for 
183.7 	the taxes payable year in which the obligations are issued and sold. This section does not 
183.8 	limit the authority to issue bonds under any other special or general law.

183.9 	Sec. 51. Minnesota Statutes 2010, section 375.167, subdivision 1, is amended to read:
183.10 		Subdivision 1.Appropriations. Notwithstanding any contrary law, a county board 
183.11 	may appropriate from the general revenue fund to any nonprofit corporation a sum not 
183.12 	to exceed 0.00604 percent of taxable estimated market value to provide legal assistance 
183.13 	to persons who are unable to afford private legal counsel.

183.14 	Sec. 52. Minnesota Statutes 2010, section 375.18, subdivision 3, is amended to read:
183.15 		Subd. 3.Courthouse. Each county board may erect, furnish, and maintain a 
183.16 	suitable courthouse. No indebtedness shall be created for a courthouse in excess of an 
183.17 	amount equal to a levy of 0.04030 percent of taxable estimated market value without the 
183.18 	approval of a majority of the voters of the county voting on the question of issuing the 
183.19 	obligation at an election.

183.20 	Sec. 53. Minnesota Statutes 2010, section 375.555, is amended to read:
183.21 	375.555 FUNDING.
183.22 	To implement the county emergency jobs program, the county board may expend 
183.23 	an amount equal to what would be generated by a levy of 0.01209 percent of taxable
183.24 	estimated market value. The money to be expended may be from any available funds 
183.25 	not otherwise earmarked.

183.26 	Sec. 54. Minnesota Statutes 2010, section 383B.152, is amended to read:
183.27 	383B.152 BUILDING AND MAINTENANCE FUND.
183.28 	The county board may by resolution levy a tax to provide money which shall be kept 
183.29 	in a fund known as the county reserve building and maintenance fund. Money in the fund 
183.30 	shall be used solely for the construction, maintenance, and equipping of county buildings 
183.31 	that are constructed or maintained by the board. The levy shall not be subject to any limit 
183.32 	fixed by any other law or by any board of tax levy or other corresponding body, but shall 
184.1 	not exceed 0.02215 percent of taxable estimated market value, less the amount required by 
184.2 	chapter 475 to be levied in the year for the payment of the principal of and interest on all 
184.3 	bonds issued pursuant to Extra Session Laws 1967, chapter 47, section 1.

184.4 	Sec. 55. Minnesota Statutes 2010, section 383B.245, is amended to read:
184.5 	383B.245 LIBRARY LEVY.
184.6 	(a) The county board may levy a tax on the taxable property within the county to 
184.7 	acquire, better, and construct county library buildings and branches and to pay principal 
184.8 	and interest on bonds issued for that purpose.
184.9 	(b) The county board may by resolution adopted by a five-sevenths vote issue and 
184.10 	sell general obligation bonds of the county in the manner provided in sections 475.60 to 
184.11 	475.73. The bonds shall not be subject to the limitations of sections 475.51 to 475.59, 
184.12 	but the maturity years and amounts and interest rates of each series of bonds shall be 
184.13 	fixed so that the maximum amount of principal and interest to become due in any year, 
184.14 	on the bonds of that series and of all outstanding series issued by or for the purposes of 
184.15 	libraries, shall not exceed an amount equal to 0.01612 percent of estimated market value 
184.16 	of all taxable property in the county as last finally equalized before the issuance of the new 
184.17 	series. When the tax levy authorized in this section is collected it shall be appropriated 
184.18 	and credited to a debt service fund for the bonds in amounts required each year in lieu of a 
184.19 	countywide tax levy for the debt service fund under section 475.61.

184.20 	Sec. 56. Minnesota Statutes 2010, section 383B.73, subdivision 1, is amended to read:
184.21 		Subdivision 1.Levy. To provide funds for the purposes of the Three Rivers Park 
184.22 	District as set forth in its annual budget, in lieu of the levies authorized by any other 
184.23 	special law for such purposes, the Board of Park District Commissioners may levy 
184.24 	taxes on all the taxable property in the county and park district at a rate not exceeding 
184.25 	0.03224 percent of estimated market value. Notwithstanding section 398.16, on or before 
184.26 	October 1 of each year, after public hearing, the Board of Park District Commissioners 
184.27 	shall adopt a budget for the ensuing year and shall determine the total amount necessary 
184.28 	to be raised from ad valorem tax levies to meet its budget. The Board of Park District 
184.29 	Commissioners shall submit the budget to the county board. The county board may veto 
184.30 	or modify an item contained in the budget. If the county board determines to veto or to 
184.31 	modify an item in the budget, it must, within 15 days after the budget was submitted by 
184.32 	the district board, state in writing the specific reasons for its objection to the item vetoed 
184.33 	or the reason for the modification. The Park District Board, after consideration of the 
184.34 	county board's objections and proposed modifications, may reapprove a vetoed item or the 
185.1 	original version of an item with respect to which a modification has been proposed, by a 
185.2 	two-thirds majority. If the district board does not reapprove a vetoed item, the item shall 
185.3 	be deleted from the budget. If the district board does not reapprove the original version 
185.4 	of a modified item, the item shall be included in the budget as modified by the county 
185.5 	board. After adoption of the final budget and no later than October 1, the superintendent 
185.6 	of the park district shall certify to the office of the Hennepin County director of tax and 
185.7 	public records exercising the functions of the county auditor the total amount to be raised 
185.8 	from ad valorem tax levies to meet its budget for the ensuing year. The director of tax 
185.9 	and public records shall add the amount of any levy certified by the district to other tax 
185.10 	levies on the property of the county within the district for collection by the director of tax 
185.11 	and public records with other taxes. When collected, the director shall make settlement of 
185.12 	such taxes with the district in the same manner as other taxes are distributed to the other 
185.13 	political subdivisions in Hennepin County.

185.14 	Sec. 57. Minnesota Statutes 2010, section 383E.20, is amended to read:
185.15 	383E.20 BONDING FOR COUNTY LIBRARY BUILDINGS.
185.16 	The Anoka County Board may, by resolution adopted by a four-sevenths vote, issue 
185.17 	and sell general obligation bonds of the county in the manner provided in chapter 475 to 
185.18 	acquire, better, and construct county library buildings. The bonds shall not be subject to the 
185.19 	requirements of sections 475.57 to 475.59. The maturity years and amounts and interest 
185.20 	rates of each series of bonds shall be fixed so that the maximum amount of principal and 
185.21 	interest to become due in any year, on the bonds of that series and of all outstanding series 
185.22 	issued by or for the purposes of libraries, shall not exceed an amount equal to .01 percent 
185.23 	of the taxable estimated market value of all taxable property in the county, excluding any 
185.24 	taxable property taxed by any city for the support of any free public library. When the tax 
185.25 	levy authorized in this section is collected, it shall be appropriated and credited to a debt 
185.26 	service fund for the bonds. The tax levy for the debt service fund under section 475.61 
185.27 	shall be reduced by the amount available or reasonably anticipated to be available in the 
185.28 	fund to make payments otherwise payable from the levy pursuant to section 475.61.

185.29 	Sec. 58. Minnesota Statutes 2010, section 383E.23, is amended to read:
185.30 	383E.23 LIBRARY TAX.
185.31 	The Anoka County Board may levy a tax of not more than .01 percent of the taxable
185.32 	estimated market value of taxable property located within the county excluding any 
185.33 	taxable property taxed by any city for the support of any free public library, to acquire, 
185.34 	better, and construct county library buildings and to pay principal and interest on bonds 
186.1 	issued for that purpose. The tax shall be disregarded in the calculation of levies or limits 
186.2 	on levies provided by section 373.40, or other law.

186.3 	Sec. 59. Minnesota Statutes 2010, section 385.31, is amended to read:
186.4 	385.31 PAYMENT OF COUNTY ORDERS OR WARRANTS.
186.5 	When any order or warrant drawn on the treasurer is presented for payment, if there 
186.6 	is money in the treasury for that purpose, the county treasurer shall redeem the same, and 
186.7 	write across the entire face thereof the word "redeemed," the date of the redemption, and 
186.8 	the treasurer's official signature. If there is not sufficient funds in the proper accounts to 
186.9 	pay such orders they shall be numbered and registered in their order of presentation, 
186.10 	and proper endorsement thereof shall be made on such orders and they shall be entitled 
186.11 	to payment in like order. Such orders shall bear interest at not to exceed the rate of six 
186.12 	percent per annum from such date of presentment. The treasurer, as soon as there is 
186.13 	sufficient money in the treasury, shall appropriate and set apart a sum sufficient for the 
186.14 	payment of the orders so presented and registered, and, if entitled to interest, issue to the 
186.15 	original holder a notice that interest will cease in 30 days from the date of such notice; and, 
186.16 	if orders thus entitled to priority of payment are not then presented, the next in order of 
186.17 	registry may be paid until such orders are presented. No interest shall be paid on any order, 
186.18 	except upon a warrant drawn by the county auditor for that purpose, giving the number 
186.19 	and the date of the order on account of which the interest warrant is drawn. In any county 
186.20 	in this state now or hereafter having a an estimated market value of all taxable property, 
186.21 	exclusive of money and credits, of not less than $1,033,000,000, the county treasurer, in 
186.22 	order to save payment of interest on county warrants drawn upon a fund in which there 
186.23 	shall be temporarily insufficient money in the treasury to redeem the same, may borrow 
186.24 	temporarily from any other fund in the county treasury in which there is a sufficient balance 
186.25 	to care for the needs of such fund and allow a temporary loan or transfer to any other fund, 
186.26 	and may pay such warrants out of such funds. Any such money so transferred and used in 
186.27 	redeeming such county warrants shall be returned to the fund from which drawn as soon 
186.28 	as money shall come in to the credit of such fund on which any such warrant was drawn 
186.29 	and paid as aforesaid. Any county operating on a cash basis may use a combined form of 
186.30 	warrant or order and check, which, when signed by the chair of the county board and by 
186.31 	the auditor, is an order or warrant for the payment of the claim, and, when countersigned 
186.32 	by the county treasurer, is a check for the payment of the amount thereof.

186.33 	Sec. 60. Minnesota Statutes 2010, section 394.36, subdivision 1, is amended to read:
187.1 		Subdivision 1.Continuation of nonconformity; limitations. Except as provided in 
187.2 	subdivision 2, 3, or 4, any nonconformity, including the lawful use or occupation of land 
187.3 	or premises existing at the time of the adoption of an official control under this chapter, 
187.4 	may be continued, although the use or occupation does not conform to the official control. 
187.5 	If the nonconformity or occupancy is discontinued for a period of more than one year, or 
187.6 	any nonconforming building or structure is destroyed by fire or other peril to the extent of 
187.7 	50 percent of its estimated market value, any subsequent use or occupancy of the land or 
187.8 	premises shall be a conforming use or occupancy.

187.9 	Sec. 61. Minnesota Statutes 2010, section 398A.04, subdivision 8, is amended to read:
187.10 		Subd. 8.Taxation. Before deciding to exercise the power to tax, the authority shall 
187.11 	give six weeks' published notice in all municipalities in the region. If a number of voters 
187.12 	in the region equal to five percent of those who voted for candidates for governor at the 
187.13 	last gubernatorial election present a petition within nine weeks of the first published notice 
187.14 	to the secretary of state requesting that the matter be submitted to popular vote, it shall be 
187.15 	submitted at the next general election. The question prepared shall be:
187.16 	"Shall the regional rail authority have the power to impose a property tax?

187.17		Yes 
........		
187.18		No ........"
		
187.19 	If a majority of those voting on the question approve or if no petition is presented 
187.20 	within the prescribed time the authority may levy a tax at any annual rate not exceeding 
187.21 	0.04835 percent of estimated market value of all taxable property situated within the 
187.22 	municipality or municipalities named in its organization resolution. Its recording officer 
187.23 	shall file, on or before September 15, in the office of the county auditor of each county 
187.24 	in which territory under the jurisdiction of the authority is located a certified copy of the 
187.25 	board of commissioners' resolution levying the tax, and each county auditor shall assess 
187.26 	and extend upon the tax rolls of each municipality named in the organization resolution the 
187.27 	portion of the tax that bears the same ratio to the whole amount that the net tax capacity of 
187.28 	taxable property in that municipality bears to the net tax capacity of taxable property in 
187.29 	all municipalities named in the organization resolution. Collections of the tax shall be 
187.30 	remitted by each county treasurer to the treasurer of the authority. For taxes levied in 1991, 
187.31 	the amount levied for light rail transit purposes under this subdivision shall not exceed 75 
187.32 	percent of the amount levied in 1990 for light rail transit purposes under this subdivision.

187.33 	Sec. 62. Minnesota Statutes 2010, section 401.05, subdivision 3, is amended to read:
188.1 		Subd. 3.Leasing. (a) A county or joint powers board of a group of counties 
188.2 	which acquires or constructs and equips or improves facilities under this chapter may, 
188.3 	with the approval of the board of county commissioners of each county, enter into a 
188.4 	lease agreement with a city situated within any of the counties, or a county housing and 
188.5 	redevelopment authority established under chapter 469 or any special law. Under the lease 
188.6 	agreement, the city or county housing and redevelopment authority shall:
188.7 	(1) construct or acquire and equip or improve a facility in accordance with plans 
188.8 	prepared by or at the request of a county or joint powers board of the group of counties 
188.9 	and approved by the commissioner of corrections; and
188.10 	(2) finance the facility by the issuance of revenue bonds.
188.11 	(b) The county or joint powers board of a group of counties may lease the facility 
188.12 	site, improvements, and equipment for a term upon rental sufficient to produce revenue 
188.13 	for the prompt payment of the revenue bonds and all interest accruing on them. Upon 
188.14 	completion of payment, the lessee shall acquire title. The real and personal property 
188.15 	acquired for the facility constitutes a project and the lease agreement constitutes a revenue 
188.16 	agreement as provided in sections 469.152 to 469.165. All proceedings by the city or 
188.17 	county housing and redevelopment authority and the county or joint powers board shall be 
188.18 	as provided in sections 469.152 to 469.165, with the following adjustments:
188.19 	(1) no tax may be imposed upon the property;
188.20 	(2) the approval of the project by the commissioner of employment and economic 
188.21 	development is not required;
188.22 	(3) the Department of Corrections shall be furnished and shall record information 
188.23 	concerning each project as it may prescribe, in lieu of reports required on other projects to 
188.24 	the commissioner of employment and economic development;
188.25 	(4) the rentals required to be paid under the lease agreement shall not exceed in any 
188.26 	year one-tenth of one percent of the estimated market value of property within the county 
188.27 	or group of counties as last equalized before the execution of the lease agreement;
188.28 	(5) the county or group of counties shall provide for payment of all rentals due 
188.29 	during the term of the lease agreement in the manner required in subdivision 4;
188.30 	(6) no mortgage on the facilities shall be granted for the security of the bonds, but 
188.31 	compliance with clause (5) may be enforced as a nondiscretionary duty of the county 
188.32 	or group of counties; and
188.33 	(7) the county or the joint powers board of the group of counties may sublease any 
188.34 	part of the facilities for purposes consistent with their maintenance and operation.

189.1 	Sec. 63. Minnesota Statutes 2010, section 410.32, is amended to read:
189.2 	410.32 CITIES MAY ISSUE CAPITAL NOTES FOR CAPITAL EQUIPMENT.
189.3 	(a) Notwithstanding any contrary provision of other law or charter, a home rule 
189.4 	charter city may, by resolution and without public referendum, issue capital notes subject 
189.5 	to the city debt limit to purchase capital equipment.
189.6 	(b) For purposes of this section, "capital equipment" means:
189.7 	(1) public safety equipment, ambulance and other medical equipment, road 
189.8 	construction and maintenance equipment, and other capital equipment; and
189.9 	(2) computer hardware and software, whether bundled with machinery or equipment 
189.10 	or unbundled.
189.11 	(c) The equipment or software must have an expected useful life at least as long 
189.12 	as the term of the notes.
189.13 	(d) The notes shall be payable in not more than ten years and be issued on terms 
189.14 	and in the manner the city determines. The total principal amount of the capital notes 
189.15 	issued in a fiscal year shall not exceed 0.03 percent of the estimated market value of 
189.16 	taxable property in the city for that year.
189.17 	(e) A tax levy shall be made for the payment of the principal and interest on the 
189.18 	notes, in accordance with section 475.61, as in the case of bonds.
189.19 	(f) Notes issued under this section shall require an affirmative vote of two-thirds of 
189.20 	the governing body of the city.
189.21 	(g) Notwithstanding a contrary provision of other law or charter, a home rule charter 
189.22 	city may also issue capital notes subject to its debt limit in the manner and subject to the 
189.23 	limitations applicable to statutory cities pursuant to section 412.301.

189.24 	Sec. 64. Minnesota Statutes 2010, section 412.221, subdivision 2, is amended to read:
189.25 		Subd. 2.Contracts. The council shall have power to make such contracts as may 
189.26 	be deemed necessary or desirable to make effective any power possessed by the council. 
189.27 	The city may purchase personal property through a conditional sales contract and real 
189.28 	property through a contract for deed under which contracts the seller is confined to the 
189.29 	remedy of recovery of the property in case of nonpayment of all or part of the purchase 
189.30 	price, which shall be payable over a period of not to exceed five years. When the contract 
189.31 	price of property to be purchased by contract for deed or conditional sales contract 
189.32 	exceeds 0.24177 percent of the estimated market value of the city, the city may not enter 
189.33 	into such a contract for at least ten days after publication in the official newspaper of a 
189.34 	council resolution determining to purchase property by such a contract; and, if before the 
189.35 	end of that time a petition asking for an election on the proposition signed by voters equal 
190.1 	to ten percent of the number of voters at the last regular city election is filed with the clerk, 
190.2 	the city may not enter into such a contract until the proposition has been approved by a 
190.3 	majority of the votes cast on the question at a regular or special election.

190.4 	Sec. 65. Minnesota Statutes 2010, section 412.301, is amended to read:
190.5 	412.301 FINANCING PURCHASE OF CERTAIN EQUIPMENT.
190.6 	(a) The council may issue certificates of indebtedness or capital notes subject to the 
190.7 	city debt limits to purchase capital equipment.
190.8 	(b) For purposes of this section, "capital equipment" means:
190.9 	(1) public safety equipment, ambulance and other medical equipment, road 
190.10 	construction and maintenance equipment, and other capital equipment; and
190.11 	(2) computer hardware and software, whether bundled with machinery or equipment 
190.12 	or unbundled.
190.13 	(c) The equipment or software must have an expected useful life at least as long as 
190.14 	the terms of the certificates or notes.
190.15 	(d) Such certificates or notes shall be payable in not more than ten years and shall be 
190.16 	issued on such terms and in such manner as the council may determine.
190.17 	(e) If the amount of the certificates or notes to be issued to finance any such purchase 
190.18 	exceeds 0.25 percent of the estimated market value of taxable property in the city, they 
190.19 	shall not be issued for at least ten days after publication in the official newspaper of 
190.20 	a council resolution determining to issue them; and if before the end of that time, a 
190.21 	petition asking for an election on the proposition signed by voters equal to ten percent 
190.22 	of the number of voters at the last regular municipal election is filed with the clerk, such 
190.23 	certificates or notes shall not be issued until the proposition of their issuance has been 
190.24 	approved by a majority of the votes cast on the question at a regular or special election.
190.25 	(f) A tax levy shall be made for the payment of the principal and interest on such 
190.26 	certificates or notes, in accordance with section 475.61, as in the case of bonds.

190.27 	Sec. 66. Minnesota Statutes 2010, section 428A.02, subdivision 1, is amended to read:
190.28 		Subdivision 1.Ordinance. The governing body of a city may adopt an ordinance 
190.29 	establishing a special service district. Only property that is classified under section 273.13
190.30 	and used for commercial, industrial, or public utility purposes, or is vacant land zoned or 
190.31 	designated on a land use plan for commercial or industrial use and located in the special 
190.32 	service district, may be subject to the charges imposed by the city on the special service 
190.33 	district. Other types of property may be included within the boundaries of the special 
190.34 	service district but are not subject to the levies or charges imposed by the city on the 
191.1 	special service district. If 50 percent or more of the estimated market value of a parcel of 
191.2 	property is classified under section 273.13 as commercial, industrial, or vacant land zoned 
191.3 	or designated on a land use plan for commercial or industrial use, or public utility for the 
191.4 	current assessment year, then the entire taxable market value of the property is subject to a 
191.5 	service charge based on net tax capacity for purposes of sections 428A.01 to 428A.10. 
191.6 	The ordinance shall describe with particularity the area within the city to be included in 
191.7 	the district and the special services to be furnished in the district. The ordinance may not 
191.8 	be adopted until after a public hearing has been held on the question. Notice of the hearing 
191.9 	shall include the time and place of hearing, a map showing the boundaries of the proposed 
191.10 	district, and a statement that all persons owning property in the proposed district that 
191.11 	would be subject to a service charge will be given opportunity to be heard at the hearing. 
191.12 	Within 30 days after adoption of the ordinance under this subdivision, the governing body 
191.13 	shall send a copy of the ordinance to the commissioner of revenue.

191.14 	Sec. 67. Minnesota Statutes 2010, section 430.102, subdivision 2, is amended to read:
191.15 		Subd. 2.Council approval; special tax levy limitation. The council shall receive 
191.16 	and consider the estimate required in subdivision 1 and the items of cost after notice and 
191.17 	hearing before it or its appropriate committee as it considers necessary or expedient, 
191.18 	and shall approve the estimate, with necessary amendments. The amounts of each item 
191.19 	of cost estimated are then appropriated to operate, maintain, and improve the pedestrian 
191.20 	mall during the next fiscal year. The amount of the special tax to be charged under 
191.21 	subdivision 1, clause (3), must not, however, exceed 0.12089 percent of estimated market 
191.22 	value of taxable property in the district. The council shall make any necessary adjustment 
191.23 	in costs of operating and maintaining the district to keep the amount of the tax within 
191.24 	this limitation.

191.25 	Sec. 68. Minnesota Statutes 2010, section 447.10, is amended to read:
191.26 	447.10 TAX LEVY FOR OPERATING AND MAINTAINING HOSPITAL.
191.27 	The governing body of a city of the first class owning a hospital may annually levy 
191.28 	a tax to operate and maintain the hospital. The tax must not exceed 0.00806 percent of 
191.29 	taxable estimated market value.

191.30 	Sec. 69. Minnesota Statutes 2010, section 450.19, is amended to read:
191.31 	450.19 TOURIST CAMPING GROUNDS.
191.32 	A home rule charter or statutory city or town may establish and maintain public 
191.33 	tourist camping grounds. The governing body thereof may acquire by lease, purchase, or 
192.1 	gift, suitable lands located either within or without the corporate limits for use as public 
192.2 	tourist camping grounds and provide for the equipment, operation, and maintenance 
192.3 	of the same. The amount that may be expended for the maintenance, improvement, or 
192.4 	operation of tourist camping grounds shall not exceed, in any year, a sum equal to 0.00806 
192.5 	percent of taxable estimated market value.

192.6 	Sec. 70. Minnesota Statutes 2010, section 450.25, is amended to read:
192.7 	450.25 MUSEUM, GALLERY, OR SCHOOL OF ARTS OR CRAFTS; TAX 
192.8 	LEVY.
192.9 	After the acquisition of any museum, gallery, or school of arts or crafts, the board 
192.10 	of park commissioners of the city in which it is located shall cause to be included in the 
192.11 	annual tax levy upon all the taxable property of the county in which the museum, gallery, 
192.12 	or school of arts or crafts is located, a tax of 0.00846 percent of estimated market value. 
192.13 	The board shall certify the levy to the county auditor and it shall be added to, and collected 
192.14 	with and as part of, the general, real, and personal property taxes, with like penalties and 
192.15 	interest, in case of nonpayment and default, and all provisions of law in respect to the 
192.16 	levy, collection, and enforcement of other taxes shall, so far as applicable, be followed in 
192.17 	respect of these taxes. All of these taxes, penalties, and interest, when collected, shall be 
192.18 	paid to the city treasurer of the city in which is located the museum, gallery, or school 
192.19 	of arts or crafts and credited to a fund to be known as the park museum fund, and shall 
192.20 	be used only for the purposes specified in sections 450.23 to 450.25. Any part of the 
192.21 	proceeds of the levy not expended for the purposes specified in section 450.24 may be 
192.22 	used for the erection of new buildings for the same purposes.

192.23 	Sec. 71. Minnesota Statutes 2010, section 458A.10, is amended to read:
192.24 	458A.10 PROPERTY TAX.
192.25 	The commission shall annually levy a tax not to exceed 0.12089 percent of estimated 
192.26 	market value on all the taxable property in the transit area at a rate sufficient to produce 
192.27 	an amount necessary for the purposes of sections 458A.01 to 458A.15, other than the 
192.28 	payment of principal and interest due on any revenue bonds issued pursuant to section 
192.29 	458A.05. Property taxes levied under this section shall be certified by the commission to 
192.30 	the county auditors of the transit area, extended, assessed, and collected in the manner 
192.31 	provided by law for the property taxes levied by the governing bodies of cities. The 
192.32 	proceeds of the taxes levied under this section shall be remitted by the respective county 
192.33 	treasurers to the treasurer of the commission, who shall credit the same to the funds of 
192.34 	the commission for use for the purposes of sections 458A.01 to 458A.15 subject to any 
193.1 	applicable pledges or limitations on account of tax anticipation certificates or other 
193.2 	specific purposes. At any time after making a tax levy under this section and certifying 
193.3 	it to the county auditors, the commission may issue general obligation certificates of 
193.4 	indebtedness in anticipation of the collection of the taxes as provided by section 412.261.

193.5 	Sec. 72. Minnesota Statutes 2010, section 458A.31, subdivision 1, is amended to read:
193.6 		Subdivision 1.Levy limit. Notwithstanding anything to the contrary contained in 
193.7 	the charter of the city of Duluth, any ordinance thereof, or any statute applicable thereto, 
193.8 	limiting the amount levied in any one year for general or special purposes, the city council 
193.9 	of the city of Duluth shall each year levy a tax in an amount not to exceed 0.07253 
193.10 	percent of taxable estimated market value, by ordinance. An ordinance fixing the levy 
193.11 	shall take effect immediately upon its passage and approval. The proceeds of the levy 
193.12 	shall be paid into the city treasury and deposited in the operating fund provided for in 
193.13 	section 458A.24, subdivision 3.

193.14 	Sec. 73. Minnesota Statutes 2010, section 465.04, is amended to read:
193.15 	465.04 ACCEPTANCE OF GIFTS.
193.16 	Cities of the second, third, or fourth class, having at any time a an estimated
193.17 	market value of not more than $41,000,000, exclusive of money and credits, as officially 
193.18 	equalized by the commissioner of revenue, either under home rule charter or under the 
193.19 	laws of this state, in addition to all other powers possessed by them, hereby are authorized 
193.20 	and empowered to receive and accept gifts and donations for the use and benefit of 
193.21 	such cities and the inhabitants thereof upon terms and conditions to be approved by the 
193.22 	governing bodies of such cities; and such cities are authorized to comply with and perform 
193.23 	such terms and conditions, which may include payment to the donor or donors of interest 
193.24 	on the value of the gift at not exceeding five percent per annum payable annually or 
193.25 	semiannually, during the remainder of the natural life or lives of such donor or donors.

193.26 	Sec. 74. Minnesota Statutes 2010, section 469.033, subdivision 6, is amended to read:
193.27 		Subd. 6.Operation area as taxing district, special tax. All of the territory 
193.28 	included within the area of operation of any authority shall constitute a taxing district for 
193.29 	the purpose of levying and collecting special benefit taxes as provided in this subdivision. 
193.30 	All of the taxable property, both real and personal, within that taxing district shall be 
193.31 	deemed to be benefited by projects to the extent of the special taxes levied under this 
193.32 	subdivision. Subject to the consent by resolution of the governing body of the city in and 
193.33 	for which it was created, an authority may levy a tax upon all taxable property within that 
194.1 	taxing district. The tax shall be extended, spread, and included with and as a part of 
194.2 	the general taxes for state, county, and municipal purposes by the county auditor, to be 
194.3 	collected and enforced therewith, together with the penalty, interest, and costs. As the tax, 
194.4 	including any penalties, interest, and costs, is collected by the county treasurer it shall be 
194.5 	accumulated and kept in a separate fund to be known as the "housing and redevelopment 
194.6 	project fund." The money in the fund shall be turned over to the authority at the same time 
194.7 	and in the same manner that the tax collections for the city are turned over to the city, and 
194.8 	shall be expended only for the purposes of sections 469.001 to 469.047. It shall be paid 
194.9 	out upon vouchers signed by the chair of the authority or an authorized representative. 
194.10 	The amount of the levy shall be an amount approved by the governing body of the city, but 
194.11 	shall not exceed 0.0185 percent of taxable estimated  market value. The authority shall 
194.12 	each year formulate and file a budget in accordance with the budget procedure of the city 
194.13 	in the same manner as required of executive departments of the city or, if no budgets are 
194.14 	required to be filed, by August 1. The amount of the tax levy for the following year shall 
194.15 	be based on that budget.

194.16 	Sec. 75. Minnesota Statutes 2010, section 469.034, subdivision 2, is amended to read:
194.17 		Subd. 2.General obligation revenue bonds. (a) An authority may pledge the 
194.18 	general obligation of the general jurisdiction governmental unit as additional security for 
194.19 	bonds payable from income or revenues of the project or the authority. The authority 
194.20 	must find that the pledged revenues will equal or exceed 110 percent of the principal and 
194.21 	interest due on the bonds for each year. The proceeds of the bonds must be used for a 
194.22 	qualified housing development project or projects. The obligations must be issued and 
194.23 	sold in the manner and following the procedures provided by chapter 475, except the 
194.24 	obligations are not subject to approval by the electors, and the maturities may extend to 
194.25 	not more than 35 years for obligations sold to finance housing for the elderly and 40 years 
194.26 	for other obligations issued under this subdivision. The authority is the municipality for 
194.27 	purposes of chapter 475.
194.28 	(b) The principal amount of the issue must be approved by the governing body of 
194.29 	the general jurisdiction governmental unit whose general obligation is pledged. Public 
194.30 	hearings must be held on issuance of the obligations by both the authority and the general 
194.31 	jurisdiction governmental unit. The hearings must be held at least 15 days, but not more 
194.32 	than 120 days, before the sale of the obligations.
194.33 	(c) The maximum amount of general obligation bonds that may be issued and 
194.34 	outstanding under this section equals the greater of (1) one-half of one percent of the 
194.35 	taxable estimated market value of the general jurisdiction governmental unit whose 
195.1 	general obligation is pledged, or (2) $3,000,000. In the case of county or multicounty 
195.2 	general obligation bonds, the outstanding general obligation bonds of all cities in the 
195.3 	county or counties issued under this subdivision must be added in calculating the limit 
195.4 	under clause (1).
195.5 	(d) "General jurisdiction governmental unit" means the city in which the housing 
195.6 	development project is located. In the case of a county or multicounty authority, the 
195.7 	county or counties may act as the general jurisdiction governmental unit. In the case of 
195.8 	a multicounty authority, the pledge of the general obligation is a pledge of a tax on the 
195.9 	taxable property in each of the counties.
195.10 	(e) "Qualified housing development project" means a housing development project 
195.11 	providing housing either for the elderly or for individuals and families with incomes not 
195.12 	greater than 80 percent of the median family income as estimated by the United States 
195.13 	Department of Housing and Urban Development for the standard metropolitan statistical 
195.14 	area or the nonmetropolitan county in which the project is located. The project must be 
195.15 	owned for the term of the bonds either by the authority or by a limited partnership or other 
195.16 	entity in which the authority or another entity under the sole control of the authority is 
195.17 	the sole general partner and the partnership or other entity must receive (1) an allocation 
195.18 	from the Department of Management and Budget or an entitlement issuer of tax-exempt 
195.19 	bonding authority for the project and a preliminary determination by the Minnesota 
195.20 	Housing Finance Agency or the applicable suballocator of tax credits that the project 
195.21 	will qualify for four percent low-income housing tax credits or (2) a reservation of nine 
195.22 	percent low-income housing tax credits from the Minnesota Housing Finance Agency or a 
195.23 	suballocator of tax credits for the project. A qualified housing development project may 
195.24 	admit nonelderly individuals and families with higher incomes if:
195.25 	(1) three years have passed since initial occupancy;
195.26 	(2) the authority finds the project is experiencing unanticipated vacancies resulting in 
195.27 	insufficient revenues, because of changes in population or other unforeseen circumstances 
195.28 	that occurred after the initial finding of adequate revenues; and
195.29 	(3) the authority finds a tax levy or payment from general assets of the general 
195.30 	jurisdiction governmental unit will be necessary to pay debt service on the bonds if higher 
195.31 	income individuals or families are not admitted.
195.32 	(f) The authority may issue bonds to refund bonds issued under this subdivision in 
195.33 	accordance with section 475.67. The finding of the adequacy of pledged revenues required 
195.34 	by paragraph (a) and the public hearing required by paragraph (b) shall not apply to the 
195.35 	issuance of refunding bonds. This paragraph applies to refunding bonds issued on and 
195.36 	after July 1, 1992.

196.1 	Sec. 76. Minnesota Statutes 2010, section 469.053, subdivision 4, is amended to read:
196.2 		Subd. 4.Mandatory city levy. A city shall, at the request of the port authority, levy 
196.3 	a tax in any year for the benefit of the port authority. The tax must not exceed 0.01813 
196.4 	percent of taxable estimated market value. The amount levied must be paid by the city 
196.5 	treasurer to the treasurer of the port authority, to be spent by the authority.

196.6 	Sec. 77. Minnesota Statutes 2010, section 469.053, subdivision 4a, is amended to read:
196.7 		Subd. 4a.Seaway port authority levy. A levy made under this subdivision shall 
196.8 	replace the mandatory city levy under subdivision 4. A seaway port authority is a special 
196.9 	taxing district under section 275.066 and may levy a tax in any year for the benefit of the 
196.10 	seaway port authority. The tax must not exceed 0.01813 percent of taxable estimated
196.11 	market value. The county auditor shall distribute the proceeds of the property tax levy to 
196.12 	the seaway port authority.

196.13 	Sec. 78. Minnesota Statutes 2010, section 469.053, subdivision 6, is amended to read:
196.14 		Subd. 6.Discretionary city levy. Upon request of a port authority, the port 
196.15 	authority's city may levy a tax to be spent by and for its port authority. The tax must 
196.16 	enable the port authority to carry out efficiently and in the public interest sections 469.048
196.17 	to 469.068 to create and develop industrial development districts. The levy must not be 
196.18 	more than 0.00282 percent of taxable estimated market value. The county treasurer shall 
196.19 	pay the proceeds of the tax to the port authority treasurer. The money may be spent by 
196.20 	the authority in performance of its duties to create and develop industrial development 
196.21 	districts. In spending the money the authority must judge what best serves the public 
196.22 	interest. The levy in this subdivision is in addition to the levy in subdivision 4.

196.23 	Sec. 79. Minnesota Statutes 2010, section 469.107, subdivision 1, is amended to read:
196.24 		Subdivision 1.City tax levy. A city may, at the request of the authority, levy a tax in 
196.25 	any year for the benefit of the authority. The tax must be not more than 0.01813 percent of 
196.26 	taxable estimated market value. The amount levied must be paid by the city treasurer to 
196.27 	the treasurer of the authority, to be spent by the authority.

196.28 	Sec. 80. Minnesota Statutes 2010, section 469.180, subdivision 2, is amended to read:
196.29 		Subd. 2.Tax levies. Notwithstanding any law, the county board of any county may 
196.30 	appropriate from the general revenue fund a sum not to exceed a county levy of 0.00080 
196.31 	percent of taxable estimated market value to carry out the purposes of this section.

197.1 	Sec. 81. Minnesota Statutes 2010, section 469.187, is amended to read:
197.2 	469.187 FIRST CLASS CITY SPENDING FOR PUBLICITY; PUBLICITY 
197.3 	BOARD.
197.4 	Any city of the first class may expend money for city publicity purposes. The city 
197.5 	may levy a tax, not exceeding 0.00080 percent of taxable estimated market value. The 
197.6 	proceeds of the levy shall be expended in the manner and for the city publicity purposes 
197.7 	the council directs. The council may establish and provide for a publicity board or bureau 
197.8 	to administer the fund, subject to the conditions and limitations the council prescribes 
197.9 	by ordinance.

197.10 	Sec. 82. Minnesota Statutes 2010, section 469.206, is amended to read:
197.11 	469.206 HAZARDOUS PROPERTY PENALTY.
197.12 	A city may assess a penalty up to one percent of the estimated market value of 
197.13 	real property, including any building located within the city that the city determines to 
197.14 	be hazardous as defined in section 463.15, subdivision 3. The city shall send a written 
197.15 	notice to the address to which the property tax statement is sent at least 90 days before it 
197.16 	may assess the penalty. If the owner of the property has not paid the penalty or fixed the 
197.17 	property within 90 days after receiving notice of the penalty, the penalty is considered 
197.18 	delinquent and is increased by 25 percent each 60 days the penalty is not paid and the 
197.19 	property remains hazardous. For the purposes of this section, a penalty that is delinquent 
197.20 	is considered a delinquent property tax and subject to chapters 279, 280, and 281, in the 
197.21 	same manner as delinquent property taxes.

197.22 	Sec. 83. Minnesota Statutes 2010, section 471.24, is amended to read:
197.23 	471.24 TOWNS, STATUTORY CITIES; JOINT MAINTENANCE OF 
197.24 	CEMETERY.
197.25 	Where a statutory city or town owns and maintains an established cemetery or burial 
197.26 	ground, either within or without the municipal limits, the statutory city or town may, by 
197.27 	mutual agreement with contiguous statutory cities and towns, each having a an estimated
197.28 	market value of not less than $2,000,000, join together in the maintenance of such public 
197.29 	cemetery or burial ground for the use of the inhabitants of each of such municipalities; and 
197.30 	each such municipality is hereby authorized, by action of its council or governing body, 
197.31 	to levy a tax or make an appropriation for the annual support and maintenance of such 
197.32 	cemetery or burial ground; provided, the amount thus appropriated by each municipality 
197.33 	shall not exceed a total of $10,000 in any one year.

198.1 	Sec. 84. Minnesota Statutes 2010, section 471.571, subdivision 1, is amended to read:
198.2 		Subdivision 1.Application. This section applies to each city in which the net tax 
198.3 	capacity of real and personal property consists in part of iron ore or lands containing 
198.4 	taconite or semitaconite and in which the total taxable estimated market value of real 
198.5 	and personal property exceeds $2,500,000.

198.6 	Sec. 85. Minnesota Statutes 2010, section 471.571, subdivision 2, is amended to read:
198.7 		Subd. 2.Creation of fund, tax levy. The governing body of the city may create a 
198.8 	permanent improvement and replacement fund to be maintained by an annual tax levy. 
198.9 	The governing body may levy a tax in excess of any charter limitation for the support of 
198.10 	the permanent improvement and replacement fund, but not exceeding the following:
198.11 	(a) in cities having a population of not more than 500 inhabitants, the lesser of $20 
198.12 	per capita or 0.08059 percent of taxable estimated market value;
198.13 	(b) in cities having a population of more than 500 and less than 2500 2,500, the 
198.14 	greater of $12.50 per capita or $10,000 but not exceeding 0.08059 percent of taxable
198.15 	estimated market value;
198.16 	(c) in cities having a population of more than 2500 2,500 or more inhabitants, 
198.17 	the greater of $10 per capita or $31,500 but not exceeding 0.08059 percent of taxable
198.18 	estimated market value.

198.19 	Sec. 86. Minnesota Statutes 2010, section 471.73, is amended to read:
198.20 	471.73 ACCEPTANCE OF PROVISIONS.
198.21 	In the case of any city within the class specified in section 471.72 having a an 
198.22 	estimated  market value, as defined in section 471.72, in excess of $37,000,000; and in the 
198.23 	case of any statutory city within such class having a an estimated market value, as defined 
198.24 	in section 471.72, of less than $5,000,000; and in the case of any statutory city within such 
198.25 	class which is governed by Laws 1933, chapter 211, or Laws 1937, chapter 356; and in 
198.26 	the case of any statutory city within such class which is governed by Laws 1929, chapter 
198.27 	208, and has a an estimated market value of less than $83,000,000; and in the case of 
198.28 	any school district within such class having a an estimated market value, as defined in 
198.29 	section 471.72, of more than $54,000,000; and in the case of all towns within said class; 
198.30 	sections 471.71 to 471.83 apply only if the governing body of the city or statutory city, the 
198.31 	board of the school district, or the town board of the town shall have adopted a resolution 
198.32 	determining to issue bonds under the provisions of sections 471.71 to 471.83 or to go 
198.33 	upon a cash basis in accordance with the provisions thereof.

199.1 	Sec. 87. Minnesota Statutes 2010, section 473.325, subdivision 2, is amended to read:
199.2 		Subd. 2.Chapter 475 applies; exceptions. The Metropolitan Council shall sell and 
199.3 	issue the bonds in the manner provided in chapter 475, and shall have the same powers 
199.4 	and duties as a municipality issuing bonds under that law, except that the approval of a 
199.5 	majority of the electors shall not be required and the net debt limitations shall not apply. 
199.6 	The terms of each series of bonds shall be fixed so that the amount of principal and interest 
199.7 	on all outstanding and undischarged bonds, together with the bonds proposed to be issued, 
199.8 	due in any year shall not exceed 0.01209 percent of estimated market value of all taxable 
199.9 	property in the metropolitan area as last finally equalized prior to a proposed issue. The 
199.10 	bonds shall be secured in accordance with section 475.61, subdivision 1, and any taxes 
199.11 	required for their payment shall be levied by the council, shall not affect the amount or rate 
199.12 	of taxes which may be levied by the council for other purposes, shall be spread against all 
199.13 	taxable property in the metropolitan area and shall not be subject to limitation as to rate or 
199.14 	amount. Any taxes certified by the council to the county auditors for collection shall be 
199.15 	reduced by the amount received by the council from the commissioner of management and 
199.16 	budget or the federal government for the purpose of paying the principal and interest on 
199.17 	bonds to which the levy relates. The council shall certify the fact and amount of all money 
199.18 	so received to the county auditors, and the auditors shall reduce the levies previously made 
199.19 	for the bonds in the manner and to the extent provided in section 475.61, subdivision 3.

199.20 	Sec. 88. Minnesota Statutes 2010, section 473.629, is amended to read:
199.21 	473.629 VALUE OF PROPERTY FOR BOND ISSUES BY SCHOOL 
199.22 	DISTRICTS.
199.23 	As to any lands to be detached from any school district under the provisions hereof
199.24 	section 473.625, notwithstanding such prospective the detachment, the estimated market 
199.25 	value of such the detached lands and the net tax capacity of taxable properties now located 
199.26 	therein or thereon shall be and on the lands on the date of the detachment constitute 
199.27 	from and after the date of the enactment hereof a part of the estimated market value of 
199.28 	properties upon the basis of which such used to calculate the net debt limit of the school 
199.29 	district may issue its bonds,. The value of such the lands for such purpose to beand other 
199.30 	taxable properties for purposes of the school district's net debt limit are 33-1/3 percent of 
199.31 	the estimated market value thereof as determined and certified by said the assessor to said
199.32 	the school district, and it shall be the duty of such the assessor annually on or before the 
199.33 	tenth day of October from and after the passage hereof, to so of each year, shall determine 
199.34 	and certify that value; provided, however, that the value of such the detached lands and 
199.35 	such taxable properties shall never exceed 20 percent of the estimated market value of 
200.1 	all properties constituting and making up the basis aforesaid used to calculate the net 
200.2 	debt limit of the school district.

200.3 	Sec. 89. Minnesota Statutes 2010, section 473.661, subdivision 3, is amended to read:
200.4 		Subd. 3.Levy limit. In any budget certified by the commissioners under this 
200.5 	section, the amount included for operation and maintenance shall not exceed an amount 
200.6 	which, when extended against the property taxable therefor under section 473.621, 
200.7 	subdivision 5, will require a levy at a rate of 0.00806 percent of estimated market value. 
200.8 	Taxes levied by the corporation shall not affect the amount or rate of taxes which may 
200.9 	be levied by any other local government unit within the metropolitan area under the 
200.10 	provisions of any charter.

200.11 	Sec. 90. Minnesota Statutes 2010, section 473.667, subdivision 9, is amended to read:
200.12 		Subd. 9.Additional taxes. Nothing herein shall prevent the commission from 
200.13 	levying a tax not to exceed 0.00121 percent of estimated market value on taxable property 
200.14 	within its taxing jurisdiction, in addition to any levies found necessary for the debt 
200.15 	service fund authorized by section 473.671. Nothing herein shall prevent the levy and 
200.16 	appropriation for purposes of the commission of any other tax on property or on any 
200.17 	income, transaction, or privilege, when and if authorized by law. All collections of any 
200.18 	taxes so levied shall be included in the revenues appropriated for the purposes referred 
200.19 	to in this section, unless otherwise provided in the law authorizing the levies; but no 
200.20 	covenant as to the continuance or as to the rate and amount of any such levy shall be made 
200.21 	with the holders of the commission's bonds unless specifically authorized by law.

200.22 	Sec. 91. Minnesota Statutes 2010, section 473.671, is amended to read:
200.23 	473.671 LIMIT OF TAX LEVY.
200.24 	The taxes levied against the property of the metropolitan area in any one year shall 
200.25 	not exceed 0.00806 percent of taxable estimated market value, exclusive of taxes levied 
200.26 	to pay the principal or interest on any bonds or indebtedness of the city issued under 
200.27 	Laws 1943, chapter 500, and exclusive of any taxes levied to pay the share of the city for 
200.28 	payments on bonded indebtedness of the corporation provided for in Laws 1943, chapter 
200.29 	500. The levy of taxes authorized in Laws 1943, chapter 500, shall be in addition to the 
200.30 	maximum rate allowed to be levied to defray the cost of government under the provisions 
200.31 	of the charter of any city affected by Laws 1943, chapter 500.

200.32 	Sec. 92. Minnesota Statutes 2010, section 473.711, subdivision 2a, is amended to read:
201.1 		Subd. 2a.Tax levy. (a) The commission may levy a tax on all taxable property in 
201.2 	the district as defined in section 473.702 to provide funds for the purposes of sections 
201.3 	473.701 to 473.716. The tax shall not exceed the property tax levy limitation determined 
201.4 	in this subdivision. A participating county may agree to levy an additional tax to be used 
201.5 	by the commission for the purposes of sections 473.701 to 473.716 but the sum of the 
201.6 	county's and commission's taxes may not exceed the county's proportionate share of 
201.7 	the property tax levy limitation determined under this subdivision based on the ratio of 
201.8 	its total net tax capacity to the total net tax capacity of the entire district as adjusted by 
201.9 	section 270.12, subdivision 3. The auditor of each county in the district shall add the 
201.10 	amount of the levy made by the district to other taxes of the county for collection by 
201.11 	the county treasurer with other taxes. When collected, the county treasurer shall make 
201.12 	settlement of the tax with the district in the same manner as other taxes are distributed 
201.13 	to political subdivisions. No county shall levy any tax for mosquito, disease vectoring 
201.14 	tick, and black gnat (Simuliidae) control except under this section. The levy shall be in 
201.15 	addition to other taxes authorized by law.
201.16 	(b) The property tax levied by the Metropolitan Mosquito Control Commission shall 
201.17 	not exceed the product of (i) the commission's property tax levy limitation for the previous 
201.18 	year determined under this subdivision multiplied by (ii) an index for market valuation 
201.19 	changes equal to the total estimated market valuation value of all taxable property for the 
201.20 	current tax payable year located within the district plus any area that has been added to the 
201.21 	district since the previous year, divided by the total estimated market valuation value of all 
201.22 	taxable property located within the district for the previous taxes payable year.
201.23 	(c) For the purpose of determining the commission's property tax levy limitation 
201.24 	under this subdivision, "total market valuation" means the total market valuation of all 
201.25 	taxable property within the district without valuation adjustments for fiscal disparities 
201.26 	(chapter 473F), tax increment financing (sections 469.174 to 469.179), and high voltage 
201.27 	transmission lines (section 273.425).

201.28 	Sec. 93. Minnesota Statutes 2010, section 473F.02, subdivision 12, is amended to read:
201.29 		Subd. 12.Adjusted market value. "Adjusted market value" of real and personal 
201.30 	property within a municipality means the assessor's estimated taxable market value, 
201.31 	as defined in section 272.03, of all real and personal property, including the value of 
201.32 	manufactured housing, within the municipality, adjusted for sales ratios in a manner 
201.33 	similar to the adjustments made to city and town net tax capacities . For purposes 
201.34 	of sections 473F.01 to 473F.13, the commissioner of revenue shall annually make 
201.35 	determinations and reports with respect to each municipality which are comparable to 
202.1 	those it makes for school districts under section 127A.48, subdivisions 1 to 6, in the same 
202.2 	manner and at the same times as are prescribed by the subdivisions. The commissioner 
202.3 	of revenue shall annually determine, for each municipality, information comparable to 
202.4 	that required by section 475.53, subdivision 4, for school districts, as soon as practicable 
202.5 	after it becomes available. The commissioner of revenue shall then compute the equalized 
202.6 	market value of property within each municipality using the aggregate sales ratios from 
202.7 	the Department of Revenue's sales ratio study.

202.8 	Sec. 94. Minnesota Statutes 2010, section 473F.02, subdivision 14, is amended to read:
202.9 		Subd. 14.Fiscal capacity. "Fiscal capacity" of a municipality means its valuation
202.10 	adjusted market value, determined as of January 2 of any year, divided by its population, 
202.11 	determined as of a date in the same year.

202.12 	Sec. 95. Minnesota Statutes 2010, section 473F.02, subdivision 15, is amended to read:
202.13 		Subd. 15.Average fiscal capacity. "Average fiscal capacity" of municipalities 
202.14 	means the sum of the valuations adjusted market values of all municipalities, determined 
202.15 	as of January 2 of any year, divided by the sum of their populations, determined as of 
202.16 	a date in the same year.

202.17 	Sec. 96. Minnesota Statutes 2010, section 473F.02, subdivision 23, is amended to read:
202.18 		Subd. 23.Net tax capacity. "Net tax capacity" means the taxable market value of 
202.19 	real and personal property multiplied by its net tax capacity rates in section 273.13.

202.20 	Sec. 97. Minnesota Statutes 2010, section 475.521, subdivision 4, is amended to read:
202.21 		Subd. 4.Limitations on amount. A municipality may not issue bonds under this 
202.22 	section if the maximum amount of principal and interest to become due in any year on 
202.23 	all the outstanding bonds issued under this section, including the bonds to be issued, 
202.24 	will equal or exceed 0.16 percent of the taxable estimated market value of property 
202.25 	in the municipality. Calculation of the limit must be made using the taxable estimated
202.26 	market value for the taxes payable year in which the obligations are issued and sold. In 
202.27 	the case of a municipality with a population of 2,500 or more, the bonds are subject to 
202.28 	the net debt limits under section 475.53. In the case of a shared facility in which more 
202.29 	than one municipality participates, upon compliance by each participating municipality 
202.30 	with the requirements of subdivision 2, the limitations in this subdivision and the net debt 
202.31 	represented by the bonds shall be allocated to each participating municipality in proportion 
202.32 	to its required financial contribution to the financing of the shared facility, as set forth in 
203.1 	the joint powers agreement relating to the shared facility. This section does not limit the 
203.2 	authority to issue bonds under any other special or general law.

203.3 	Sec. 98. Minnesota Statutes 2010, section 475.53, subdivision 1, is amended to read:
203.4 		Subdivision 1.Generally. Except as otherwise provided in sections 475.51 to 
203.5 	475.74, no municipality, except a school district or a city of the first class, shall incur or be 
203.6 	subject to a net debt in excess of three percent of the estimated market value of taxable 
203.7 	property in the municipality.

203.8 	Sec. 99. Minnesota Statutes 2010, section 475.53, subdivision 3, is amended to read:
203.9 		Subd. 3.Cities first class. Unless its charter permits a greater net debt a city of 
203.10 	the first class may not incur a net debt in excess of two percent of the estimated market 
203.11 	value of all taxable property therein. If the charter of the city permits a net debt of the city 
203.12 	in excess of two percent of its valuation, it may not incur a net debt in excess of 3-2/3 
203.13 	percent of the estimated market value of the taxable property therein.
203.14 	The county auditor, at the time of preparing the tax list of the city, shall compile a 
203.15 	statement setting forth the total net tax capacity and the total estimated market value of 
203.16 	each class of taxable property in such city for such year.

203.17 	Sec. 100. Minnesota Statutes 2010, section 475.53, subdivision 4, is amended to read:
203.18 		Subd. 4.School districts. Except as otherwise provided by law, no school district 
203.19 	shall be subject to a net debt in excess of 15 percent of the actual estimated  market value 
203.20 	of all taxable property situated within its corporate limits, as computed in accordance with 
203.21 	this subdivision. The county auditor of each county containing taxable real or personal 
203.22 	property situated within any school district shall certify to the district upon request the 
203.23 	estimated market value of all such property. Whenever the commissioner of revenue, in 
203.24 	accordance with section 127A.48, subdivisions 1 to 6, has determined that the net tax 
203.25 	capacity of any district furnished by county auditors is not based upon theadjusted market 
203.26 	value of taxable property in the district exceeds the estimated market value of property 
203.27 	within the district, the commissioner of revenue shall certify to the district upon request 
203.28 	the ratio most recently ascertained to exist between such the estimated market  value and 
203.29 	the actual adjusted market value of property within the district., and the actual market 
203.30 	value of property within a district, on which its debt limit under this subdivision is will 
203.31 	be  based, is (a) the value certified by the county auditors, or (b) this on the estimated 
203.32 	market value divided by the ratio certified by the commissioner of revenue, whichever 
203.33 	results in a higher value.

204.1 	Sec. 101. Minnesota Statutes 2010, section 475.58, subdivision 2, is amended to read:
204.2 		Subd. 2.Funding, refunding. Any county, city, town, or school district whose 
204.3 	outstanding gross debt, including all items referred to in section 475.51, subdivision 
204.4 	4, exceed in amount 1.62 percent of its estimated market value may issue bonds under 
204.5 	this subdivision for the purpose of funding or refunding such indebtedness or any part 
204.6 	thereof. A list of the items of indebtedness to be funded or refunded shall be made by the 
204.7 	recording officer and treasurer and filed in the office of the recording officer. The initial 
204.8 	resolution of the governing body shall refer to this subdivision as authority for the issue, 
204.9 	state the amount of bonds to be issued and refer to the list of indebtedness to be funded or 
204.10 	refunded. This resolution shall be published once each week for two successive weeks 
204.11 	in a legal newspaper published in the municipality or if there be no such newspaper, in 
204.12 	a legal newspaper published in the county seat. Such bonds may be issued without the 
204.13 	submission of the question of their issue to the electors unless within ten days after the 
204.14 	second publication of the resolution a petition requesting such election signed by ten or 
204.15 	more voters who are taxpayers of the municipality, shall be filed with the recording officer. 
204.16 	In event such petition is filed, no bonds shall be issued hereunder unless authorized by a 
204.17 	majority of the electors voting on the question.

204.18 	Sec. 102. Minnesota Statutes 2010, section 475.73, subdivision 1, is amended to read:
204.19 		Subdivision 1.May purchase these bonds; conditions. Obligations sold under the 
204.20 	provisions of section 475.60 may be purchased by the State Board of Investment if the 
204.21 	obligations meet the requirements of section 11A.24, subdivision 2, upon the approval of 
204.22 	the attorney general as to form and execution of the application therefor, and under rules 
204.23 	as the board may specify, and the state board shall have authority to purchase the same 
204.24 	to an amount not exceeding 3.63 percent of the estimated market value of the taxable 
204.25 	property of the municipality, according to the last preceding assessment. The obligations 
204.26 	shall not run for a shorter period than one year, nor for a longer period than 30 years and 
204.27 	shall bear interest at a rate to be fixed by the state board but not less than two percent per 
204.28 	annum. Forthwith upon the delivery to the state of Minnesota of any obligations issued by 
204.29 	virtue thereof, the commissioner of management and budget shall certify to the respective 
204.30 	auditors of the various counties wherein are situated the municipalities issuing the same, 
204.31 	the number, denomination, amount, rate of interest and date of maturity of each obligation.

204.32 	Sec. 103. Minnesota Statutes 2011 Supplement, section 477A.011, subdivision 20, 
204.33 	is amended to read:
205.1 		Subd. 20.City net tax capacity. "City net tax capacity" means (1) the net tax 
205.2 	capacity computed using the net tax capacity rates in section 273.13 for taxes payable 
205.3 	in the year of the aid distribution, and the market values, after the exclusion in section 
205.4 	273.13, subdivision 35, for taxes payable in the year prior to the aid distribution plus (2) 
205.5 	a city's fiscal disparities distribution tax capacity under section 276A.06, subdivision 2, 
205.6 	paragraph (b), or 473F.08, subdivision 2, paragraph (b), for taxes payable in the year prior 
205.7 	to that for which aids are being calculated. The market value utilized in computing city 
205.8 	net tax capacity shall be reduced by the sum of (1) a city's market value of commercial 
205.9 	industrial property as defined in section 276A.01, subdivision 3, or 473F.02, subdivision 3, 
205.10 	multiplied by the ratio determined pursuant to section 276A.06, subdivision 2, paragraph 
205.11 	(a), or 473F.08, subdivision 2, paragraph (a), (2) the market value of the captured value 
205.12 	of tax increment financing districts as defined in section 469.177, subdivision 2, and (3) 
205.13 	the market value of transmission lines deducted from a city's total net tax capacity under 
205.14 	section 273.425. The city net tax capacity will be computed using equalized market values
205.15 	the city's adjusted net tax capacity under section 273.1325.

205.16 	EFFECTIVE DATE. This section is effective the day following final enactment.

205.17 	Sec. 104. Minnesota Statutes 2010, section 477A.011, subdivision 32, is amended to 
205.18 	read:
205.19 		Subd. 32.Commercial industrial percentage. "Commercial industrial percentage" 
205.20 	for a city is 100 times the sum of the estimated market values of all real property in the 
205.21 	city classified as class 3 under section 273.13, subdivision 24, excluding public utility 
205.22 	property, to the total estimated market value of all taxable real and personal property in 
205.23 	the city. The estimated market values are the amounts computed before any adjustments 
205.24 	for fiscal disparities under section 276A.06 or 473F.08. The estimated market values 
205.25 	used for this subdivision are not equalized.

205.26 	EFFECTIVE DATE. This section is effective for aids payable in 2014 and 
205.27 	thereafter.

205.28 	Sec. 105. Minnesota Statutes 2010, section 477A.0124, subdivision 2, is amended to 
205.29 	read:
205.30 		Subd. 2.Definitions. (a) For the purposes of this section, the following terms 
205.31 	have the meanings given them.
205.32 	(b) "County program aid" means the sum of "county need aid," "county tax base 
205.33 	equalization aid," and "county transition aid."
206.1 	(c) "Age-adjusted population" means a county's population multiplied by the county 
206.2 	age index.
206.3 	(d) "County age index" means the percentage of the population over age 65 within 
206.4 	the county divided by the percentage of the population over age 65 within the state, except 
206.5 	that the age index for any county may not be greater than 1.8 nor less than 0.8.
206.6 	(e) "Population over age 65" means the population over age 65 established as of 
206.7 	July 15 in an aid calculation year by the most recent federal census, by a special census 
206.8 	conducted under contract with the United States Bureau of the Census, by a population 
206.9 	estimate made by the Metropolitan Council, or by a population estimate of the state 
206.10 	demographer made pursuant to section 4A.02, whichever is the most recent as to the stated 
206.11 	date of the count or estimate for the preceding calendar year and which has been certified 
206.12 	to the commissioner of revenue on or before July 15 of the aid calculation year. A revision 
206.13 	to an estimate or count is effective for these purposes only if certified to the commissioner 
206.14 	on or before July 15 of the aid calculation year. Clerical errors in the certification or use of 
206.15 	estimates and counts established as of July 15 in the aid calculation year are subject to 
206.16 	correction within the time periods allowed under section 477A.014.
206.17 	(f) "Part I crimes" means the three-year average annual number of Part I crimes 
206.18 	reported for each county by the Department of Public Safety for the most recent years 
206.19 	available. By July 1 of each year, the commissioner of public safety shall certify to the 
206.20 	commissioner of revenue the number of Part I crimes reported for each county for the 
206.21 	three most recent calendar years available.
206.22 	(g) "Households receiving food stamps" means the average monthly number of 
206.23 	households receiving food stamps for the three most recent years for which data is 
206.24 	available. By July 1 of each year, the commissioner of human services must certify to the 
206.25 	commissioner of revenue the average monthly number of households in the state and in 
206.26 	each county that receive food stamps, for the three most recent calendar years available.
206.27 	(h) "County net tax capacity" means the net tax capacity of the county, computed 
206.28 	analogously to city net tax capacity under section 477A.011, subdivision 20 county's 
206.29 	adjusted net tax capacity under section 273.1325.

206.30 	EFFECTIVE DATE. This section is effective the day following final enactment.

206.31 	Sec. 106. Minnesota Statutes 2010, section 641.23, is amended to read:
206.32 	641.23 FUNDS; HOW PROVIDED.
206.33 	Before any contract is made for the erection of a county jail, sheriff's residence, or 
206.34 	both, the county board shall either levy a sufficient tax to provide the necessary funds, or 
207.1 	issue county bonds therefor in accordance with the provisions of chapter 475, provided 
207.2 	that no election is required if the amount of all bonds issued for this purpose and interest 
207.3 	on them which are due and payable in any year does not exceed an amount equal to 
207.4 	0.09671 percent of estimated market value of taxable property within the county, as last 
207.5 	determined before the bonds are issued.

207.6 	Sec. 107. Minnesota Statutes 2010, section 641.24, is amended to read:
207.7 	641.24 LEASING.
207.8 	The county may, by resolution of the county board, enter into a lease agreement with 
207.9 	any statutory or home rule charter city situated within the county, or a county housing and 
207.10 	redevelopment authority established pursuant to chapter 469 or any special law whereby 
207.11 	the city or county housing and redevelopment authority will construct a jail or other law 
207.12 	enforcement facilities for the county sheriff, deputy sheriffs, and other employees of the 
207.13 	sheriff and other law enforcement agencies, in accordance with plans prepared by or at 
207.14 	the request of the county board and, when required, approved by the commissioner of 
207.15 	corrections and will finance it by the issuance of revenue bonds, and the county may lease 
207.16 	the site and improvements for a term and upon rentals sufficient to produce revenue for the 
207.17 	prompt payment of the bonds and all interest accruing thereon and, upon completion of 
207.18 	payment, will acquire title thereto. The real and personal property acquired for the jail 
207.19 	shall constitute a project and the lease agreement shall constitute a revenue agreement 
207.20 	as contemplated in chapter 469, and all proceedings shall be taken by the city or county 
207.21 	housing and redevelopment authority and the county in the manner and with the force and 
207.22 	effect provided in chapter 469; provided that:
207.23 	(1) no tax shall be imposed upon or in lieu of a tax upon the property;
207.24 	(2) the approval of the project by the commissioner of commerce shall not be 
207.25 	required;
207.26 	(3) the Department of Corrections shall be furnished and shall record such 
207.27 	information concerning each project as it may prescribe;
207.28 	(4) the rentals required to be paid under the lease agreement shall not exceed in any 
207.29 	year one-tenth of one percent of the estimated market value of property within the county, 
207.30 	as last finally equalized before the execution of the agreement;
207.31 	(5) the county board shall provide for the payment of all rentals due during the term 
207.32 	of the lease, in the manner required in section 641.264, subdivision 2;
207.33 	(6) no mortgage on the property shall be granted for the security of the bonds, but 
207.34 	compliance with clause (5) hereof may be enforced as a nondiscretionary duty of the 
207.35 	county board; and
208.1 	(7) the county board may sublease any part of the jail property for purposes consistent 
208.2 	with the maintenance and operation of a county jail or other law enforcement facility.

208.3 	Sec. 108. Minnesota Statutes 2010, section 645.44, is amended by adding a subdivision 
208.4 	to read:
208.5 		Subd. 20.Estimated market value. When used in determining or calculating a 
208.6 	limit on taxation, spending, state aid amounts, or debt, bond, certificate of indebtedness, or 
208.7 	capital note issuance by or for a local government unit, "estimated market value" has the 
208.8 	meaning given in section 273.032. 

208.9 	Sec. 109. REVISOR'S INSTRUCTION.
 208.10 	The revisor of statutes shall recodify Minnesota Statutes, section 127A.48, 
208.11 	subdivisions 1 to 6, as section 273.1325, subdivisions 1 to 6, and change all 
208.12 	cross-references to the affected subdivisions accordingly.

208.13 	EFFECTIVE DATE. This section is effective the day following final enactment.

208.14 	Sec. 110.  REPEALER.
 208.15 	Minnesota Statutes 2010, sections 273.11, subdivision 1a; 276A.01, subdivision 
208.16 	11; 276A.06, subdivision 10; 473F.02, subdivision 13; 473F.08, subdivision 10; and 
208.17 	477A.011, subdivision 21, are repealed.

208.18 	Sec. 111. EFFECTIVE DATE.
 208.19 	Unless otherwise specifically provided, this article is effective the day following 
208.20 	final enactment for purposes of limits on net debt, the issuance of bonds, certificates of 
208.21 	indebtedness, and capital notes and is effective beginning for taxes payable in 2013 for 
208.22 	all other purposes.

208.23 	ARTICLE 13
208.24 	MISCELLANEOUS TAXES

208.25 	Section 1. [136A.129] GREATER MINNESOTA INTERNSHIP PROGRAM.
208.26 		Subdivision 1.Definitions. (a) For the purposes of this section, the terms defined in 
208.27 	this subdivision have the meanings given them.
208.28 	(b) "Eligible employer" means a taxpayer under section 290.01 with employees 
208.29 	located in greater Minnesota.
209.1 	(c) "Eligible institution" means a Minnesota public postsecondary institution, or a 
209.2 	Minnesota private, nonprofit, baccalaureate degree granting college or university.
209.3 	(d) "Eligible student" means a student enrolled in an eligible institution who is a 
209.4 	junior or senior in a degree program or has completed one-half of the credits necessary for 
209.5 	an associate degree or certification.
209.6 	(e) "Greater Minnesota" means the area located outside of the metropolitan area, as 
209.7 	defined in section 473.121, subdivision 2.
209.8 	(f) "Office" means the Office of Higher Education.
209.9 		Subd. 2.Program established. The office, in cooperation with the Department of 
209.10 	Employment and Economic Development, shall administer a greater Minnesota internship 
209.11 	grant program for eligible employers who hire interns in greater Minnesota through 
209.12 	eligible institutions that provide academic credit. The purpose of the program is to 
209.13 	encourage Minnesota businesses to:
209.14 	(1) employ and provide valuable experience to Minnesota students; and
209.15 	(2) foster long-term relationships between the students and greater Minnesota 
209.16 	employers.
209.17 		Subd. 3.Program components. (a) An intern must be an eligible student who 
209.18 	has been admitted to a major program that is closely related to the intern experience 
209.19 	as determined by the eligible institution.
209.20 	(b) To participate in the program, an eligible institution must:
209.21 	(1) enter into written agreements with eligible employers to provide paid internships 
209.22 	that are at least 12 weeks long and located in greater Minnesota;
209.23 	(2) determine that the work experience of the internship is closely related to the 
209.24 	eligible student's course of study; and
209.25 	(3) provide academic credit for the successful completion of the internship or 
209.26 	ensure that it fulfills requirements necessary to complete a vocational technical education 
209.27 	program.
209.28 	(c) To participate in the program, an eligible employer must enter into a written 
209.29 	agreement with an eligible institution specifying that the intern:
209.30 	(1) would not have been hired without the grant described in subdivision 4;
209.31 	(2) did not work for the employer prior to entering the agreement;
209.32 	(3) does not replace an existing employee;
209.33 	(4) has not previously participated in the program;
209.34 	(5) will be employed at a location in greater Minnesota;
209.35 	(6) will be paid at least minimum wage for a minimum of 16 hours per week for at 
209.36 	least a 12-week period; and
210.1 	(7) will be supervised and evaluated by the employer.
210.2 	(d) Participating eligible institutions and eligible employers must report annually to 
210.3 	the office. The report must include at least the following:
210.4 	(1) the number of interns hired;
210.5 	(2) the number of hours and weeks worked by interns; and
210.6 	(3) the compensation paid to interns.
210.7 	(e) An internship with clinical experience currently required for completion of 
210.8 	an academic program does not qualify for the greater Minnesota internship program 
210.9 	under this section.
210.10 		Subd. 4.Employer grants for internships; maximum limits. (a) A grant for an 
210.11 	eligible employer equals 40 percent of the compensation paid to each qualifying intern, 
210.12 	not to exceed $1,250. An employer may receive a grant for a maximum of five interns 
210.13 	in any fiscal year.
210.14 	(b) The total amount of grants authorized under this section is limited to $1,000,000 
210.15 	per fiscal year less administrative expense as provided in law. The office shall allocate 
210.16 	grants to eligible institutions for participating employers and certify to the Department of 
210.17 	Employment and Economic Development the amount of the grant.
210.18 		Subd. 5.Allocations to institutions. The office shall allocate employer grants 
210.19 	authorized in subdivision 4 to eligible institutions. The office shall determine relevant 
210.20 	criteria to allocate the grants, including the geographic distribution of grants to work 
210.21 	locations outside the metropolitan area. Any grant amount allocated to an institution but 
210.22 	not used may be reallocated to other eligible institutions. The office shall allocate a portion 
210.23 	of any administrative fee to participating eligible institutions for their administrative costs.
210.24 		Subd. 6.Reports to the legislature. (a) By February 1, 2013, the office and the 
210.25 	Department of Employment and Economic Development shall report to the legislature on 
210.26 	the greater Minnesota internship program. The report must include at least the following:
210.27 	(1) the number and dollar amount of grants allocated to employers;
210.28 	(2) the number of interns employed under the program; and
210.29 	(3) the cost of administering the program.
210.30 	(b) By February 1, 2014, the office and the Department of Employment and 
210.31 	Economic Development shall report to the legislature with an analysis of the effectiveness 
210.32 	of the program in stimulating businesses to hire interns and in assisting participating 
210.33 	interns in finding permanent career positions. The report must include the number of 
210.34 	students who participated in the program who were subsequently employed full-time by 
210.35 	the employer.
210.36 		Subd. 7.Sunset. This section expires on June 30, 2015.

211.1 	EFFECTIVE DATE. This section is effective July 1, 2012.

211.2 	Sec. 2. Minnesota Statutes 2010, section 297G.04, subdivision 2, is amended to read:
211.3 		Subd. 2.Tax credit. A qualified brewer producing fermented malt beverages 
211.4 	is entitled to a tax credit of $4.60 per barrel on 25,000 barrels sold in any fiscal year 
211.5 	beginning July 1, regardless of the alcohol content of the product. Qualified brewers may 
211.6 	take the credit on the 18th day of each month, but the total credit allowed may not exceed 
211.7 	in any fiscal year the lesser of:
211.8 	(1) the liability for tax; or
211.9 	(2) $115,000.
211.10 	For purposes of this subdivision, a "qualified brewer" means a brewer, whether or 
211.11 	not located in this state, manufacturing less than 100,000 250,000 barrels of fermented 
211.12 	malt beverages in the calendar year immediately preceding the calendar year for which 
211.13 	the credit under this subdivision is claimed. In determining the number of barrels, all 
211.14 	brands or labels of a brewer must be combined. All facilities for the manufacture of 
211.15 	fermented malt beverages owned or controlled by the same person, corporation, or other 
211.16 	entity must be treated as a single brewer.

211.17 	EFFECTIVE DATE. This section is effective for determinations based on calendar 
211.18 	year 2011 production and thereafter.

211.19 	Sec. 3. Minnesota Statutes 2010, section 298.75, is amended by adding a subdivision 
211.20 	to read:
211.21 		Subd. 12.Tax may be imposed; Otter Tail County. (a) If Otter Tail County 
211.22 	does not impose a tax under this section and approves imposition of the tax under this 
211.23 	subdivision, the city of Vergas in Otter Tail County may impose the aggregate materials 
211.24 	tax under this section.
211.25 	(b) For purposes of exercising the powers contained in this section, the "city" is 
211.26 	deemed to be the "county."
211.27 	(c) All provisions in this section apply to the city of Vergas, except that in lieu of the 
211.28 	tax proceeds under subdivision 7, all proceeds of the tax must be retained by the city.
211.29 	(d) If Otter Tail County imposes an aggregate materials tax under this section, the 
211.30 	tax imposed by the city of Vergas under this subdivision is repealed on the effective 
211.31 	date of the Otter Tail County tax.

212.1 	EFFECTIVE DATE. This section is effective the day after the governing body of 
212.2 	the city of Vergas and its chief clerical officer comply with Minnesota Statutes, section 
212.3 	645.021, subdivisions 2 and 3.

212.4 	Sec. 4. Minnesota Statutes 2010, section 469.169, is amended by adding a subdivision 
212.5 	to read:
212.6 		Subd. 19.Additional border city allocation; 2012. (a) In addition to tax 
212.7 	reductions authorized in subdivisions 7 to 18, the commissioner shall allocate $125,000 
212.8 	for tax reductions to border city enterprise zones in cities located on the western border 
212.9 	of the state. The commissioner shall make allocations to zones in cities on the western 
212.10 	border on a per capita basis. Allocations made under this subdivision may be used for 
212.11 	tax reductions as provided in section 469.171, or for other offsets of taxes imposed on 
212.12 	or remitted by businesses located in the enterprise zone, but only if the municipality 
212.13 	determines that the granting of the tax reduction or offset is necessary in order to retain a 
212.14 	business within or attract a business to the zone. The city alternatively may elect to use 
212.15 	any portion of the allocation provided in this paragraph for tax reductions under section 
212.16 	469.1732 or 469.1734.
212.17 	(b) The commissioner shall allocate $125,000 for tax reductions under section 
212.18 	469.1732 or 469.1734 to cities with border city enterprise zones located on the western 
212.19 	border of the state. The commissioner shall allocate this amount among the cities on a per 
212.20 	capita basis. The city alternatively may elect to use any portion of the allocation provided 
212.21 	in this paragraph for tax reductions as provided in section 469.171.

212.22 	Sec. 5. PURPOSE STATEMENTS; TAX EXPENDITURES.
 212.23 		Subdivision 1.Authority. This section is intended to fulfill the requirement under 
212.24 	Minnesota Statutes, section 3.192, that a bill creating, renewing, or continuing a tax 
212.25 	expenditure provide a purpose for the tax expenditure and a standard or goal against 
212.26 	which its effectiveness may be measured.
212.27 		Subd. 2.Federal conformity. The provisions of article 8 conforming Minnesota 
212.28 	individual income tax to changes in federal law are intended to simplify compliance with 
212.29 	and administration of the individual income tax.
212.30 		Subd. 3.Employment of qualified veterans tax credit. The provisions of article 8, 
212.31 	section 15, providing a tax credit for the employment of qualified veterans, are intended 
212.32 	to give an incentive to employers to hire returning veterans who would otherwise be 
212.33 	unemployed and to encourage their reintegration into the community. The standard against 
213.1 	which the effectiveness of the credit is to be measured is the additional number of veterans 
213.2 	who are hired as a result of the tax credit.
213.3 		Subd. 4.Extension of historic structure rehabilitation credit. The provisions 
213.4 	of article 8, section 14, extending the sunset of the historic structure rehabilitation credit 
213.5 	are intended to create and retain jobs related to rehabilitation of historic structures in 
213.6 	Minnesota. The standard against which the effectiveness of the extension of the credit is to 
213.7 	be measured is the number of jobs created through the rehabilitation of historic structures 
213.8 	and the number of historic structures rehabilitated and placed in service.
213.9 		Subd. 5.Exemption of certain laboratory services from the health care provider 
213.10 	tax. The provisions of article 9, section 2, exempting laboratory services on specimens 
213.11 	collected outside the state from the health care provider tax is intended to eliminate 
213.12 	a competitive disadvantage for laboratories located in Minnesota when competing to 
213.13 	provide services with laboratories located outside of the state.
213.14 		Subd. 6.Sales tax exemption for established religious orders. The provisions 
213.15 	of article 9, section 7, exempting certain sales between a religious order and an affiliated 
213.16 	institute of higher education is intended to retain an existing sales tax exemption that 
213.17 	exists between St. John's Abbey and St. John's University after a governing restructure 
213.18 	between the two entities.
213.19 		Subd. 7.Sales tax exemption for nursing homes and boarding care homes.
 213.20 	The provisions of article 9, section 8, exempting certain nursing homes and boarding 
213.21 	care homes is intended to clarify that an existing exemption for these facilities is not 
213.22 	affected by a recent property tax case related to defining nonprofit organizations engaged 
213.23 	in charitable activities.

213.24 	EFFECTIVE DATE. This section is effective the day following final enactment.

213.25 	Sec. 6. BUDGET RESERVE.
 213.26 	The commissioner of management and budget shall cancel $27,900,000 to the 
213.27 	general fund from the budget reserve account in Minnesota Statutes, section 16A.152.

213.28 	EFFECTIVE DATE. This section is effective the day following final enactment.

213.29 	Sec. 7. APPROPRIATION; GREATER MINNESOTA INTERNSHIP 
213.30 	PROGRAM.
 213.31 	$1,000,000 for fiscal year 2013 is appropriated from the general fund to the 
213.32 	commissioner of employment and economic development for grants under Minnesota 
213.33 	Statutes, section 136A.129, for employers who hire interns. Up to five percent of 
214.1 	the appropriation is for an administrative fee for the Office of Higher Education and 
214.2 	participating eligible institutions. The base for the Department of Employment and 
214.3 	Economic Development for the greater Minnesota internship program is $1,000,000 in 
214.4 	fiscal year 2014, $1,000,000 in fiscal year 2015, and $0 beginning in fiscal year 2016.

214.5 	EFFECTIVE DATE. This section is effective July 1, 2012.

214.6 	Sec. 8. APPROPRIATION; MINNESOTA INVESTMENT FUND.
 214.7 	$7,000,000 for fiscal year 2013 is appropriated from the general fund to the 
214.8 	commissioner of employment and economic development for the Minnesota investment 
214.9 	fund under Minnesota Statutes, section 116J.8731. The commissioner of employment 
214.10 	and economic development must consult with the Science and Technology Initiative 
214.11 	Advisory Commission established in Minnesota Statutes, section 116W.06, and must 
214.12 	obtain approval of a simple majority of the commission in determining how to use 25 
214.13 	percent of this amount. This is a onetime appropriation and is available until spent.