1.1 	A bill for an act
1.2 	proposing an amendment to the Minnesota Constitution, by adding an article XV; 
1.3 	providing for limits on state and local spending and tax increases.
1.4 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.5 	Section 1. CONSTITUTIONAL AMENDMENTS PROPOSED.
 1.6 	An amendment to the Minnesota Constitution is proposed to  the people.  If the 
1.7 	amendment is adopted, a new article XV shall be added to read as follows:
1.8 	ARTICLE XV
1.9 	TAXPAYER'S BILL OF RIGHTS

1.10 	Section 1. This section takes effect July 1, 2007.  Its preferred interpretation shall 
1.11 	reasonably restrain most of the growth of government.  All provisions are self-executing 
1.12 	and severable and supersede conflicting state constitutional, state statutory, charter, or 
1.13 	other state or local provisions.  Individual or class action enforcement suits may be filed 
1.14 	and shall have the highest civil priority of resolution.  Successful plaintiffs shall be 
1.15 	awarded costs and reasonable attorney fees, but a district shall not be awarded costs and 
1.16 	reasonable attorney fees unless a suit against it is ruled frivolous.  Revenue collected, kept, 
1.17 	or spent illegally since four full fiscal years before a suit is filed shall be refunded with 12 
1.18 	percent annual simple interest from the initial conduct.  Subject to judicial review, districts 
1.19 	may use any reasonable method for refunds under this section, including temporary tax 
1.20 	credits or rate reductions. Refunds need not be proportional when prior payments are 
1.21 	impractical to identify or return.  Other limits on district revenue, spending, and debt may 
1.22 	be weakened only by future voter approval in the district that enacted the limit.  Only 
1.23 	when annual district revenue is less than annual payments on general obligation bonds, 
2.1 	pensions, and final court judgments, sections 4 and 6 shall be suspended to provide for the 
2.2 	deficiency.  This article shall be strictly construed in favor of taxpayers and substantial 
2.3 	compliance and good faith are no defense.

2.4 	Sec. 2. Within this article, the following terms have the meanings given them.
2.5 	 (a) "Ballot issue" means a petition or a referred measure in an election requesting 
2.6 	voter authorization to increase taxes, debt, or revenue as required under the provisions 
2.7 	of this article.
2.8 	 (b) "District" means the state or any local government, excluding enterprises.
2.9 	 (c) "Emergency" excludes economic conditions, revenue shortfalls, or district salary 
2.10 	or fringe benefit increases.
2.11 	 (d) "Enterprise" means a government-owned business authorized to issue its own 
2.12 	revenue bonds and receiving under ten percent of annual revenue in grants from all state 
2.13 	and local governments combined.
2.14 	 (e) "Fiscal year spending" means all district expenditures and reserve increases 
2.15 	except, as to both, those for refunds made in the current or next fiscal year or those from 
2.16 	private gifts, federal funds, collections for another government, pension contributions by 
2.17 	employees and pension fund earnings, reserve transfers or expenditures, or real property 
2.18 	sales.
2.19 	 (f) "Inflation" means the percentage change in the United States Bureau of Labor 
2.20 	Statistics Consumer Price Index for the midwest region, all items, all urban consumers, or 
2.21 	its successor index.
2.22 	 (g) "Local government" means a city, town, or any political subdivision with 
2.23 	authority to levy property taxes, except a school district.
2.24 	 (h) "Local growth" for a local government means a net percentage change in 
2.25 	actual value of all real property in a district from construction of taxable real property 
2.26 	improvements, minus destruction of similar improvements, and additions to, minus 
2.27 	deletions from, taxable real property.
2.28 	 (i) "Population" means the population established by the federal census, by a special 
2.29 	census conducted by the United States, or by a population estimate by the Metropolitan 
2.30 	Council, state demographer, or other body or official as established by law, whichever is 
2.31 	the most recent for the preceding calendar year.

2.32 	Sec. 3. (a) Ballot issues shall be decided in a general election on the first Tuesday after 
2.33 	the first Monday in November.
2.34 	 (b) At least 30 days before a ballot issue election, districts shall mail at the least cost, 
2.35 	and as a package where districts with ballot issues overlap, a titled notice or set of notices 
2.36 	addressed to "All Registered Voters" at each address of one or more active registered 
3.1 	electors.  The wording listed immediately above each ballot title shall state the first 
3.2 	appropriate one of the following headings:  "NOTICE OF ELECTION TO INCREASE 
3.3 	TAXES ON A CITIZEN PETITION/ON A REFERRED MEASURE." Notices shall 
3.4 	include only:
3.5 	 (1) the election date and hours; ballot title; text of any statute, ordinance, or other 
3.6 	law being adopted or amended in relation to, or as a result of, the ballot issue; and the 
3.7 	local election office address and telephone number;
3.8 	 (2) for proposed district tax or tax increase, the estimated or actual total of district 
3.9 	fiscal year spending for the current year and each of the past four years, and the overall 
3.10 	percentage and dollar change;
3.11 	 (3) for the first full fiscal year of each proposed district tax increase, district estimates 
3.12 	of the maximum dollar amount of each increase and of district fiscal year spending 
3.13 	without the increase;
3.14 	 (4) two summaries, up to 500 words each, one for and one against the proposal, 
3.15 	of written comments filed with the election officer at least 45 days before the election. 
3.16 	No summary shall mention names of persons or private groups, nor any endorsements 
3.17 	of or resolutions against the proposal. Petition representatives following these rules 
3.18 	shall write this summary for their petition.  The election officer shall maintain and 
3.19 	accurately summarize all other relevant written comments filed in good faith and not as a 
3.20 	counterproductive or irrelevant argument.
3.21 	 (c) Except by later voter approval, if a tax increase or if fiscal year spending exceeds 
3.22 	any estimate in paragraph (b), clause (3), for the same fiscal year, the tax increase is 
3.23 	thereafter reduced up to 100 percent in proportion to the combined dollar excess, and the 
3.24 	combined excess revenue deposited under section 6, paragraph (d).  Ballot titles for tax 
3.25 	increases shall begin, "SHALL (DISTRICT) TAXES BE INCREASED (first, or if phased 
3.26 	in, final, full fiscal year dollar increase) ANNUALLY...?"  Omissions and misstatement 
3.27 	of the information required in this paragraph and paragraph (b), or a numerical variance 
3.28 	greater than five percent from the true amounts, shall invalidate the ballot issue; strict 
3.29 	compliance is required.  There shall be a 100-word limit on ballot titles.

3.30 	Sec. 4. Unless section 1 or 5 applies, districts must have voter approval in advance 
3.31 	for any new tax, tax rate increase, or extension of an expiring tax; or a tax policy change 
3.32 	directly causing a net tax revenue gain to any district.

3.33 	Sec. 5. This section grants no new taxing power.  Emergency property and income tax 
3.34 	revenue is excluded for purposes of sections 3, paragraph (c), and 6, even if later ratified 
3.35 	by voters.  Emergency taxes shall also meet all of the following conditions:
4.1 	 (a) A three-fourths majority of the members of each house of the legislature or the 
4.2 	governing body of a local district declares the emergency and imposes the tax or tax 
4.3 	increase of any type defined in section 4 or otherwise by separate recorded roll call votes.
4.4 	 (b) Emergency tax revenue shall be spent only after reserves are depleted, and shall 
4.5 	be refunded within 180 days after the emergency ends if not spent on the emergency.
4.6 	 (c) An emergency tax or tax increase not approved on the next election date 60 days 
4.7 	or more after the declaration shall end with that election month.

4.8 	Sec. 6. (a) The maximum annual percentage change in state fiscal year spending 
4.9 	equals inflation plus the percentage change in state population in the prior calendar year, 
4.10 	adjusted for revenue changes approved by voters.  The percentage change in population 
4.11 	cannot be less than zero.
4.12 	 (b) The maximum annual percentage change in each local district's fiscal year 
4.13 	spending equals inflation in the prior calendar year plus annual local growth, adjusted for 
4.14 	revenue changes approved by voters and the reductions in section 7. Annual local growth 
4.15 	cannot be less than zero.
4.16 	 (c) The maximum annual percentage change in each district's property tax revenue 
4.17 	equals inflation in the prior calendar year plus annual local growth, adjusted for property 
4.18 	tax revenue changes approved by voters and the reductions in section 7. Levies shall be 
4.19 	reduced in advance to prevent collection in violation of this paragraph.
4.20 	 (d) Unless voters approve a revenue change, as an offset, if revenue from sources not 
4.21 	excluded from fiscal year spending exceeds these limits in dollars for the two previous 
4.22 	fiscal years, the excess must be deposited in a reserve and cash flow account until the 
4.23 	amounts in the account exceed .. percent of the spending limit.  Excess revenues exceeding 
4.24 	that amount must be deposited in an account dedicated to tax reform and tax and debt 
4.25 	reductions.  Funds in the tax reform and tax and debt reduction account must be expended 
4.26 	within two fiscal years after the required date of deposit in the fund.  Initial district bases 
4.27 	are 2007 fiscal year spending and property taxes payable in 2007.  Retiring or refinancing 
4.28 	debt shall lower fiscal year spending by the annual debt service so funded.  Debt service 
4.29 	changes and voter-approved revenue changes are dollar amounts that are exceptions to, 
4.30 	and not part of, any district base. Voter-approved revenue changes do not require a tax 
4.31 	rate change.  Voter-approved revenue increases are specific, fixed dollar amounts in only 
4.32 	the amount listed at the beginning of the ballot title as required in section 3 and, in later 
4.33 	years, shall not be adjusted for inflation, growth, or other factors. Voter-approved revenue 
4.34 	decreases shall lower the spending limits by the revenue decrease each year they exist. 
4.35 	Changes and adjustments referred to in this section may be increases or decreases.
4.36 	 (e) Each district shall treat all its excess revenue as follows: 
5.1 	Elections on district retention of excess revenue shall be referred by a 3/4ths vote of the 
5.2 	members of both houses of the legislature or of the local elected governing body and shall 
5.3 	occur in November only.  Voter approval shall retain a specific, fixed dollar amount from 
5.4 	the prior year only.  Ballot issues to retain current or future excess revenue are prohibited. 
5.5 	In computing excess revenue, revenue increases approved by voters after July 1, 2007, 
5.6 	shall adjust spending limits only by the specific, fixed dollar amount constitutionally 
5.7 	required to begin that ballot title.  Ballot language shall state these words only:
5.8 	 "SHALL (DISTRICT) TAXES BE INCREASED (specific, fixed dollar amount) BY 
5.9 	LETTING THAT GOVERNMENT SPEND LAST YEAR'S EXCESS REVENUE 
5.10 	INSTEAD OF DEDICATING IT TO BUDGET RESERVES AND/OR TAX OR 
5.11 	DEBT REDUCTION?" 

5.12 	Sec. 7. Except for public education through grade 12 or as required of a local district 
5.13 	by federal law, a local district may reduce or end its subsidy to any program delegated to 
5.14 	it by the legislature for administration.  For current programs, the state may require 90 
5.15 	days' written notice and that the adjustment occur in a maximum of three equal annual 
5.16 	installments.  For purposes of this section, any district is considered a separate government 
5.17 	and not a political subdivision or part of the state.

5.18 	Sec. 8. A school district shall not increase a tax rate or tax levy except by approval of a 
5.19 	majority of voters casting votes in the school district at a general election.

5.20 	Sec. 2. SUBMISSION TO VOTERS.
 5.21 	 The proposed amendment must be submitted to the people at the 2006 general 
5.22 	election.  The question submitted shall be:
5.23 	 "Effective July 1, 2007, shall the Minnesota Constitution be amended to limit 
5.24 	increases in government spending and taxes, unless approved by the voters, as follows:
5.25 	 (1) for state spending, to a percentage no greater than the percentage increases in 
5.26 	inflation and population;
5.27 	 (2) for local government spending, other than school districts, to a percentage 
5.28 	increase no greater than the percentage increases in inflation and in the taxable real 
5.29 	property base; and 
5.30 	 (3) for state and local governments, to limit tax increases and prohibit new taxes? 

5.31	Yes .......
	
5.32	No ......."