1.1 	A bill for an act
1.2 	relating to taxation; clarifying the treatment of
1.3 	government housing payments for purpose of the
1.4 	property tax exemption for charitable institutions;
1.5 	amending Minnesota Statutes 2004, section 272.02,
1.6 	subdivision 7.
1.7 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.8 	Section 1. Minnesota Statutes 2004, section 272.02,
1.9 	subdivision 7, is amended to read:
1.10 		Subd. 7.Institutions of public charity. (a) 
1.11 	Institutions of purely public charity are exempt ~~except parcels~~
1.12 	~~of property containing structures and the structures described~~
1.13 	~~in section 273.13, subdivision 25, paragraph (e), other than~~
1.14 	~~those that qualify for exemption under subdivision 26~~.
1.15 	(b) In determining whether rental housing property is
1.16 	exempt under this subdivision or under article XI, section 2, of
1.17 	the Constitution as an institution of purely public charity,
1.18 	government housing assistance payments are income, not gifts or
1.19 	donations, to the owner or manager of the rental housing.
1.20 	Receipt of government housing assistance payments does not
1.21 	disqualify a rental housing property from qualifying for
1.22 	exemption if the requirements under this subdivision, including
1.23 	receipt of sufficient gifts and donations, are otherwise
1.24 	satisfied.
1.25 	(c) For purposes of this subdivision, government housing
1.26 	assistance payments include:
2.1 	(1) rent assistance provided by the government to or on
2.2 	behalf of tenants; and 
2.3 	(2) government financial assistance or tax credits
2.4 	requiring units to be set aside for persons or families with
2.5 	certain income or other characteristics, or limiting the rents,
2.6 	or both.
2.7 	
EFFECTIVE DATE. This section is effective beginning for
2.8 	taxes payable in 2006.