1.1 	A bill for an act
1.2 	relating to taxation; making policy, technical, administrative, and clarifying 
1.3 	changes to various taxes and fees and related provisions; changing provisions 
1.4 	relating to government data practices and debt collection; providing for 
1.5 	compliance with job opportunity building zone requirements;amending 
1.6 	Minnesota Statutes 2006, sections 13.51, subdivision 3; 13.585, subdivision 
1.7 	5; 16D.02, subdivisions 3, 6; 16D.04, subdivision 2; 163.051, subdivision 5; 
1.8 	270A.08, subdivision 1; 270C.33, subdivision 5; 270C.56, subdivision 1; 272.02, 
1.9 	subdivisions 13, 20, 21, 27, 31, 38, 49; 272.03, subdivision 3, by adding a 
1.10 	subdivision; 273.11, subdivision 8; 273.124, subdivisions 6, 13, 21; 273.128, 
1.11 	subdivision 1; 273.13, subdivisions 22, 23, 25, 33; 274.01, subdivision 3; 
1.12 	274.014, subdivision 3; 276.04, subdivision 2; 287.20, subdivisions 3a, 9, by 
1.13 	adding a subdivision; 289A.18, subdivision 1; 289A.55, by adding a subdivision; 
1.14 	289A.60, by adding a subdivision; 290.01, subdivision 6b; 290.068, subdivision 
1.15 	3; 290.07, subdivision 1; 290.21, subdivision 4; 290.92, subdivision 26; 290B.04, 
1.16 	subdivision 1; 295.50, subdivision 4; 295.52, subdivision 4; 295.53, subdivision 
1.17 	4a; 296A.07, subdivision 4; 296A.08, subdivision 3; 296A.16, subdivision 2; 
1.18 	297A.61, subdivisions 22, 29; 297A.665; 297A.67, subdivision 7; 297A.995, 
1.19 	subdivision 10, by adding subdivisions; 297B.01, subdivision 7; 297B.03; 
1.20 	297F.01, subdivision 8; 297F.21, subdivision 1; 297G.01, subdivision 9; 
1.21 	297H.09; 297I.05, subdivision 12; 469.040, subdivision 4; 469.174, subdivision 
1.22 	10b; 469.177, subdivision 1c; 469.319; 477A.03, subdivision 2a; Minnesota 
1.23 	Statutes 2007 Supplement, sections 115A.1314, subdivision 2; 273.1231, 
1.24 	subdivision 7, by adding a subdivision; 273.1232, subdivision 1; 273.1233, 
1.25 	subdivisions 1, 3; 273.1234; 273.1235, subdivisions 1, 3; proposing coding for 
1.26 	new law in Minnesota Statutes, chapters 273; 469; repealing Minnesota Statutes 
1.27 	2006, section 477A.014, subdivision 5; Minnesota Statutes 2007 Supplement, 
1.28 	section 477A.014, subdivision 4; Minnesota Rules, parts 8031.0100, subpart 
1.29 	3; 8093.2100.
1.30 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

2.1 	ARTICLE 1
2.2 	INDIVIDUAL INCOME AND CORPORATE FRANCHISE TAXES

2.3 	Section 1. Minnesota Statutes 2006, section 289A.18, subdivision 1, is amended to 
2.4 	read:
2.5 		Subdivision 1.Individual income, fiduciary income, corporate franchise, and 
2.6 	entertainment taxes; partnership and S corporation returns; information returns; 
2.7 	mining company returns. The returns required to be made under sections 289A.08 and 
2.8 	289A.12 must be filed at the following times:
2.9 	(1) returns made on the basis of the calendar year must be filed on April 15 following 
2.10 	the close of the calendar year, except that returns of corporations must be filed on March 
2.11 	15 following the close of the calendar year;
2.12 	(2) returns made on the basis of the fiscal year must be filed on the 15th day of the 
2.13 	fourth month following the close of the fiscal year, except that returns of corporations 
2.14 	must be filed on the 15th day of the third month following the close of the fiscal year;
2.15 	(3) returns for a fractional part of a year must be filed on the 15th day of the fourth 
2.16 	month following the end of the month in which falls the last day of the period for which 
2.17 	the return is made, except that the returns of corporations must be filed on the 15th day of 
2.18 	the third month following the end of the tax year; or, in the case of a corporation which is 
2.19 	a member of a unitary group, the return of the corporation must be filed on the 15th day of 
2.20 	the third month following the end of the tax year of the unitary group in which falls the 
2.21 	last day of the period for which the return is made;
2.22 	(4) in the case of a final return of a decedent for a fractional part of a year, the return 
2.23 	must be filed on the 15th day of the fourth month following the close of the 12-month 
2.24 	period that began with the first day of that fractional part of a year;
2.25 	(5) in the case of the return of a cooperative association, returns must be filed on or 
2.26 	before the 15th day of the ninth month following the close of the taxable year;
2.27 	(6) if a corporation has been divested from a unitary group and files a return for 
2.28 	a fractional part of a year in which it was a member of a unitary business that files a 
2.29 	combined report under section ~~290.34~~ 290.17, subdivision ~~2~~ 4, the divested corporation's 
2.30 	return must be filed on the 15th day of the third month following the close of the common 
2.31 	accounting period that includes the fractional year;
2.32 	(7) returns of entertainment entities must be filed on April 15 following the close of 
2.33 	the calendar year;
2.34 	(8) returns required to be filed under section 289A.08, subdivision 4, must be filed 
2.35 	on the 15th day of the fifth month following the close of the taxable year;
3.1 	(9) returns of mining companies must be filed on May 1 following the close of the 
3.2 	calendar year; and
3.3 	(10) returns required to be filed with the commissioner under section 289A.12, 
3.4 	subdivision 2, 4 to 10, or 14, must be filed within 30 days after being demanded by the 
3.5 	commissioner.

3.6 	EFFECTIVE DATE. This section is effective the day following final enactment 
3.7 	except that the change in clause (6) is effective for taxable years beginning after December 
3.8 	31, 2007.

3.9 	Sec. 2. Minnesota Statutes 2006, section 290.01, subdivision 6b, is amended to read:
3.10 		Subd. 6b.Foreign operating corporation. The term "foreign operating 
3.11 	corporation," when applied to a corporation, means a domestic corporation with the 
3.12 	following characteristics:
3.13 	(1) it is part of a unitary business at least one member of which is taxable in this state;
3.14 	(2) it is not a foreign sales corporation under section 922 of the Internal Revenue 
3.15 	Code, as amended through December 31, 1999, for the taxable year;
3.16 	(3)(i) the average of the percentages of its property and payrolls, including the pro 
3.17 	rata share of its unitary partnerships' property and payrolls, assigned to locations outside 
3.18 	the United States, where the United States includes the District of Columbia and excludes 
3.19 	the commonwealth of Puerto Rico and possessions of the United States, as determined 
3.20 	under section 290.191 or 290.20, is 80 percent or more; or (ii) it has in effect a valid 
3.21 	election under section 936 of the Internal Revenue Code; and
3.22 	(4) it has a minimum of $1,000,000 of payroll and $2,000,000 of property, as 
3.23 	determined under section 290.191 or 290.20, that are located outside the United States. If 
3.24 	the domestic corporation does not have payroll as determined under section 290.191 or 
3.25 	290.20, but it or its partnerships have paid $1,000,000 for work, performed directly for the 
3.26 	domestic corporation or the partnerships, outside the United States, then paragraph (3)(i) 
3.27 	shall not require payrolls to be included in the average calculation.

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

3.29 	Sec. 3. Minnesota Statutes 2006, section 290.068, subdivision 3, is amended to read:
3.30 		Subd. 3.Limitation; carryover. (a)(1) The credit for the taxable year shall not 
3.31 	exceed the liability for tax. "Liability for tax" for purposes of this section means the tax 
3.32 	imposed under ~~this chapter~~ section 290.06, subdivision 1, for the taxable year reduced by 
3.33 	the sum of the nonrefundable credits allowed under this chapter.
4.1 	(2) In the case of a corporation which is a partner in a partnership, the credit allowed 
4.2 	for the taxable year shall not exceed the lesser of the amount determined under clause (1) 
4.3 	for the taxable year or an amount (separately computed with respect to the corporation's 
4.4 	interest in the trade or business or entity) equal to the amount of tax attributable to that 
4.5 	portion of taxable income which is allocable or apportionable to the corporation's interest 
4.6 	in the trade or business or entity.
4.7 	(b) If the amount of the credit determined under this section for any taxable year 
4.8 	exceeds the limitation under clause (a), the excess shall be a research credit carryover to 
4.9 	each of the 15 succeeding taxable years. The entire amount of the excess unused credit for 
4.10 	the taxable year shall be carried first to the earliest of the taxable years to which the credit 
4.11 	may be carried and then to each successive year to which the credit may be carried. The 
4.12 	amount of the unused credit which may be added under this clause shall not exceed the 
4.13 	taxpayer's liability for tax less the research credit for the taxable year.

4.14 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
4.15 	December 31, 2007.

4.16 	Sec. 4. Minnesota Statutes 2006, section 290.07, subdivision 1, is amended to read:
4.17 		Subdivision 1.Annual accounting period. Net income and taxable net income 
4.18 	shall be computed upon the basis of the taxpayer's annual accounting period. If a taxpayer 
4.19 	has no annual accounting period, or has one other than a fiscal year, as heretofore defined, 
4.20 	the net income and taxable net income shall be computed on the basis of the calendar year. 
4.21 	Taxpayers shall employ the same accounting period on which they report, or would be 
4.22 	required to report, their net income under the Internal Revenue Code. The commissioner 
4.23 	shall provide by rule for the determination of the accounting period for taxpayers who 
4.24 	file a combined report under section ~~290.34~~ 290.17, subdivision ~~2~~ 4, when members of 
4.25 	the group use different accounting periods for federal income tax purposes. Unless the 
4.26 	taxpayer changes its accounting period for federal purposes, the due date of the return 
4.27 	is not changed. 
4.28 	A taxpayer may change accounting periods only with the consent of the 
4.29 	commissioner. In case of any such change, the taxpayer shall pay a tax for the period 
4.30 	not included in either the taxpayer's former or newly adopted taxable year, computed as 
4.31 	provided in section 290.32. 

4.32 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
4.33 	December 31, 2007.

5.1 	Sec. 5. Minnesota Statutes 2006, section 290.21, subdivision 4, is amended to read:
5.2 		Subd. 4.Dividends received from another corporation. (a)(1) Eighty percent 
5.3 	of dividends received by a corporation during the taxable year from another corporation, 
5.4 	in which the recipient owns 20 percent or more of the stock, by vote and value, not 
5.5 	including stock described in section 1504(a)(4) of the Internal Revenue Code when the 
5.6 	corporate stock with respect to which dividends are paid does not constitute the stock in 
5.7 	trade of the taxpayer or would not be included in the inventory of the taxpayer, or does not 
5.8 	constitute property held by the taxpayer primarily for sale to customers in the ordinary 
5.9 	course of the taxpayer's trade or business, or when the trade or business of the taxpayer 
5.10 	does not consist principally of the holding of the stocks and the collection of the income 
5.11 	and gains therefrom; and
5.12 	(2)(i) the remaining 20 percent of dividends if the dividends received are the stock in 
5.13 	an affiliated company transferred in an overall plan of reorganization and the dividend 
5.14 	is eliminated in consolidation under Treasury Department Regulation 1.1502-14(a), as 
5.15 	amended through December 31, 1989;
5.16 	(ii) the remaining 20 percent of dividends if the dividends are received from a 
5.17 	corporation which is subject to tax under section 290.36 and which is a member of an 
5.18 	affiliated group of corporations as defined by the Internal Revenue Code and the dividend 
5.19 	is eliminated in consolidation under Treasury Department Regulation 1.1502-14(a), as 
5.20 	amended through December 31, 1989, or is deducted under an election under section 
5.21 	243(b) of the Internal Revenue Code; or 
5.22 	(iii) the remaining 20 percent of the dividends if the dividends are received from a 
5.23 	property and casualty insurer as defined under section 60A.60, subdivision 8, which is a 
5.24 	member of an affiliated group of corporations as defined by the Internal Revenue Code 
5.25 	and either: (A) the dividend is eliminated in consolidation under Treasury Regulation 
5.26 	1.1502-14(a), as amended through December 31, 1989; or (B) the dividend is deducted 
5.27 	under an election under section 243(b) of the Internal Revenue Code. 
5.28 	(b) Seventy percent of dividends received by a corporation during the taxable year 
5.29 	from another corporation in which the recipient owns less than 20 percent of the stock, 
5.30 	by vote or value, not including stock described in section 1504(a)(4) of the Internal 
5.31 	Revenue Code when the corporate stock with respect to which dividends are paid does not 
5.32 	constitute the stock in trade of the taxpayer, or does not constitute property held by the 
5.33 	taxpayer primarily for sale to customers in the ordinary course of the taxpayer's trade or 
5.34 	business, or when the trade or business of the taxpayer does not consist principally of the 
5.35 	holding of the stocks and the collection of income and gain therefrom.
6.1 	(c) The dividend deduction provided in this subdivision shall be allowed only with 
6.2 	respect to dividends that are included in a corporation's Minnesota taxable net income 
6.3 	for the taxable year.
6.4 	The dividend deduction provided in this subdivision does not apply to a dividend 
6.5 	from a corporation which, for the taxable year of the corporation in which the distribution 
6.6 	is made or for the next preceding taxable year of the corporation, is a corporation exempt 
6.7 	from tax under section 501 of the Internal Revenue Code.
6.8 	The dividend deduction provided in this subdivision applies to the amount of 
6.9 	regulated investment company dividends only to the extent determined under section 
6.10 	854(b) of the Internal Revenue Code.
6.11 	The dividend deduction provided in this subdivision shall not be allowed with 
6.12 	respect to any dividend for which a deduction is not allowed under the provisions of 
6.13 	section 246(c) of the Internal Revenue Code.
6.14 	(d) If dividends received by a corporation that does not have nexus with Minnesota 
6.15 	under the provisions of Public Law 86-272 are included as income on the return of 
6.16 	an affiliated corporation permitted or required to file a combined report under section
6.17 	290.17, subdivision 4 or290.34, subdivision 2, then for purposes of this subdivision the 
6.18 	determination as to whether the trade or business of the corporation consists principally 
6.19 	of the holding of stocks and the collection of income and gains therefrom shall be made 
6.20 	with reference to the trade or business of the affiliated corporation having a nexus with 
6.21 	Minnesota. 
6.22 	(e) The deduction provided by this subdivision does not apply if the dividends are 
6.23 	paid by a FSC as defined in section 922 of the Internal Revenue Code.
6.24 	(f) If one or more of the members of the unitary group whose income is included on 
6.25 	the combined report received a dividend, the deduction under this subdivision for each 
6.26 	member of the unitary business required to file a return under this chapter is the product 
6.27 	of: (1) 100 percent of the dividends received by members of the group; (2) the percentage 
6.28 	allowed pursuant to paragraph (a) or (b); and (3) the percentage of the taxpayer's business 
6.29 	income apportionable to this state for the taxable year under section 290.191 or 290.20. 

6.30 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
6.31 	December 31, 2007.

6.32 	Sec. 6. Minnesota Statutes 2006, section 290.92, subdivision 26, is amended to read:
6.33 		Subd. 26.Extension of withholding to certain payments where identifying 
6.34 	number not furnished or inaccurate. (a) If, in the case of any reportable payment, (1) 
6.35 	the payee fails to furnish the payee's Social Security account number to the payor, ~~or~~
7.1 	(2) the payee is subject to federal backup withholding on the reportable payment under 
7.2 	section 3406 of the Internal Revenue Code, or (3) the commissioner notifies the payor that 
7.3 	the Social Security account number furnished by the payee is incorrect, then the payor 
7.4 	shall deduct and withhold from the payment a tax equal to the amount of the payment 
7.5 	multiplied by the highest rate used in determining the income tax liability of an individual 
7.6 	under section 290.06, subdivision 2c. 
7.7 	(b)(1) In the case of any failure described in clause (a)(1), clause (a) shall apply to 
7.8 	any reportable payment made by the payor during the period during which the Social 
7.9 	Security account number has not been furnished.
7.10 	(2) In any case where there is a notification described in clause (a)~~(2)~~(3), clause (a) 
7.11 	shall apply to any reportable payment made by the payor (i) after the close of the 30th 
7.12 	day after the day on which the payor received the notification, and (ii) before the payee 
7.13 	furnishes another Social Security account number.
7.14 	(3)(i) Unless the payor elects not to have this subparagraph apply with respect to 
7.15 	the payee, clause (a) shall also apply to any reportable payment made after the close of 
7.16 	the period described in paragraph (1) or (2) (as the case may be) and before the 30th 
7.17 	day after the close of the period.
7.18 	(ii) If the payor elects the application of this subparagraph with respect to the payee, 
7.19 	clause (a) shall also apply to any reportable payment made during the 30-day period 
7.20 	described in paragraph (2).
7.21 	(iii) The payor may elect a period shorter than the grace period set forth in 
7.22 	subparagraph (i) or (ii) as the case may be.
7.23 	(c) The provisions of section 3406 of the Internal Revenue Code shall apply and 
7.24 	shall govern when withholding shall be required and the definition of terms. The term 
7.25 	"reportable payment" shall include only those payments for personal services. No tax 
7.26 	shall be deducted or withheld under this subdivision with respect to any amount for 
7.27 	which withholding is otherwise required under this section. For purposes of this section, 
7.28 	payments which are subject to withholding under this subdivision shall be treated as if 
7.29 	they were wages paid by an employer to an employee and amounts deducted and withheld 
7.30 	under this subdivision shall be treated as if deducted and withheld under subdivision 2a.
7.31 	(d) Whenever the commissioner notifies a payor under this subdivision that the 
7.32 	Social Security account number furnished by any payee is incorrect, the commissioner 
7.33 	shall at the same time furnish a copy of the notice to the payor, and the payor shall 
7.34 	promptly furnish the copy to the payee. If the commissioner notifies a payor under this 
7.35 	subdivision that the Social Security account number furnished by any payee is incorrect 
7.36 	and the payee subsequently furnishes another Social Security account number to the 
8.1 	payor, the payor shall promptly notify the commissioner of the other Social Security 
8.2 	account number furnished.

8.3 	EFFECTIVE DATE. This section is effective for payments made after December 
8.4 	31, 2008.

8.5 	Sec. 7. RULE CHANGE.
 8.6 	The commissioner of revenue shall amend Minnesota Rules, part 8019.0405, subpart 
8.7 	2, item A, so that subpart 2, item A, also includes a citation to Minnesota Statutes, section 
8.8 	290.17, subdivision 4, paragraph (j), for the requirement that two or more corporations 
8.9 	that are part of a unitary business file a combined income report. The commissioner of 
8.10 	revenue must use Minnesota Statutes, section 14.389, in adopting the amendment.

8.11 	Sec. 8.  REPEALER.
 8.12 	Minnesota Rules, part 8031.0100, subpart 3, is repealed effective the day following 
8.13 	final enactment.
8.14 	Minnesota Rules, part 8093.2100, is repealed effective the day following final 
8.15 	enactment.

8.16 	ARTICLE 2
8.17 	SALES AND USE TAXES

8.18 	Section 1. Minnesota Statutes 2006, section 289A.55, is amended by adding a 
8.19 	subdivision to read:
8.20 		Subd. 10.Relief for purchasers. A purchaser that meets the requirements of section 
8.21 	297A.995, subdivision 11, is relieved from the imposition of interest on tax and penalty.

8.22 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
8.23 	December 31, 2008.

8.24 	Sec. 2. Minnesota Statutes 2006, section 289A.60, is amended by adding a subdivision 
8.25 	to read:
8.26 		Subd. 28.Relief for purchasers. A purchaser that meets the requirements of 
8.27 	section 297A.995, subdivision 11, is relieved from the imposition of penalty.

8.28 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
8.29 	December 31, 2008.

9.1 	Sec. 3. Minnesota Statutes 2006, section 297A.61, subdivision 22, is amended to read:
9.2 		Subd. 22.Internal Revenue Code. Unless specifically provided otherwise, 
9.3 	"Internal Revenue Code" means the Internal Revenue Code of 1986, as amended through 
9.4 	December 31, ~~2000~~ 2007.

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

9.6 	Sec. 4. Minnesota Statutes 2006, section 297A.61, subdivision 29, is amended to read:
9.7 		Subd. 29.State. Unless specifically provided otherwise, "state" means any state of 
9.8 	the United States, the Commonwealth of Puerto Rico, and the District of Columbia.

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

9.10 	Sec. 5. Minnesota Statutes 2006, section 297A.665, is amended to read:
9.11 	297A.665 PRESUMPTION OF TAX; BURDEN OF PROOF.
9.12 	(a) For the purpose of the proper administration of this chapter and to prevent 
9.13 	evasion of the tax, until the contrary is established, it is presumed that:
9.14 	(1) all gross receipts are subject to the tax; and
9.15 	(2) all retail sales for delivery in Minnesota are for storage, use, or other consumption 
9.16 	in Minnesota.
9.17 	(b) The burden of proving that a sale is not a taxable retail sale is on the seller. 
9.18 	However, the seller may take from the purchaser at the time of the sale a fully completed 
9.19 	exemption certificate which conclusively relieves the seller from collecting and remitting 
9.20 	the tax. This relief from liability does not apply to a seller who fraudulently fails to collect 
9.21 	the tax or solicits purchasers to participate in the unlawful claim of an exemption. If a 
9.22 	seller claiming that certain sales are exempt is not in possession of the required exemption 
9.23 	certificates within 60 days after receiving written notice from the commissioner that the 
9.24 	certificates are required, deductions claimed by the seller that required delivery of the 
9.25 	certificates must be disallowed. If the certificates are delivered to the commissioner within 
9.26 	the 60-day period, the commissioner may verify the reason or basis for the exemption 
9.27 	claimed in the certificates before allowing any deductions. A deduction must not be 
9.28 	granted on the basis of certificates delivered to the commissioner after the 60-day period.
9.29 	(c) A certified service provider, as defined in section 297A.995, subdivision 2, is 
9.30 	relieved of liability under this section to the extent a seller who is its client is relieved of 
9.31 	liability.
9.32 	~~(c)~~(d) A purchaser of tangible personal property or any items listed in section 
9.33 	297A.63 that are shipped or brought to Minnesota by the purchaser has the burden 
10.1 	of proving that the property was not purchased from a retailer for storage, use, or 
10.2 	consumption in Minnesota. 

10.3 	EFFECTIVE DATE. This section is effective retroactively for sales and purchases 
10.4 	made after December 31, 2007.

10.5 	Sec. 6. Minnesota Statutes 2006, section 297A.67, subdivision 7, is amended to read:
10.6 		Subd. 7.Drugs; medical devices. (a) Sales of the following drugs and medical 
10.7 	devices for human use are exempt:
10.8 	(1) drugs ~~for human use~~, including over-the-counter drugs;
10.9 	(2) single-use finger-pricking devices for the extraction of blood and other single-use 
10.10 	devices and single-use diagnostic agents used in diagnosing, monitoring, or treating 
10.11 	diabetes;
10.12 	(3) insulin and medical oxygen for human use, regardless of whether prescribed 
10.13 	or sold over the counter;
10.14 	(4) prosthetic devices;
10.15 	(5) durable medical equipment for home use only;
10.16 	(6) mobility enhancing equipment; and
10.17 	(7) prescription corrective eyeglasses.
10.18 	(b) For purposes of this subdivision:
10.19 	(1) "Drug" means a compound, substance, or preparation, and any component of 
10.20 	a compound, substance, or preparation, other than food and food ingredients, dietary 
10.21 	supplements, or alcoholic beverages that is:
10.22 	(i) recognized in the official United States Pharmacopoeia, official Homeopathic 
10.23 	Pharmacopoeia of the United States, or official National Formulary, and supplement 
10.24 	to any of them;
10.25 	(ii) intended for use in the diagnosis, cure, mitigation, treatment, or prevention 
10.26 	of disease; or
10.27 	(iii) intended to affect the structure or any function of the body.
10.28 	(2) "Durable medical equipment" means equipment, including repair and 
10.29 	replacement parts, but not including mobility enhancing equipment, that:
10.30 	(i) can withstand repeated use;
10.31 	(ii) is primarily and customarily used to serve a medical purpose;
10.32 	(iii) generally is not useful to a person in the absence of illness or injury; and
10.33 	(iv) is not worn in or on the body.
11.1 	For purposes of this clause, "repair and replacement parts" includes all components 
11.2 	or attachments used in conjunction with the durable medical equipment, but does not 
11.3 	include repair and replacement parts which are for single patient use only.
11.4 	(3) "Mobility enhancing equipment" means equipment, including repair and 
11.5 	replacement parts, but not including durable medical equipment, that:
11.6 	(i) is primarily and customarily used to provide or increase the ability to move from 
11.7 	one place to another and that is appropriate for use either in a home or a motor vehicle;
11.8 	(ii) is not generally used by persons with normal mobility; and
11.9 	(iii) does not include any motor vehicle or equipment on a motor vehicle normally 
11.10 	provided by a motor vehicle manufacturer.
11.11 	(4) "Over-the-counter drug" means a drug that contains a label that identifies the 
11.12 	product as a drug as required by Code of Federal Regulations, title 21, section 201.66. The 
11.13 	label must include a "drug facts" panel or a statement of the active ingredients with a list of 
11.14 	those ingredients contained in the compound, substance, or preparation. Over-the-counter 
11.15 	drugs do not include grooming and hygiene products, regardless of whether they otherwise 
11.16 	meet the definition. "Grooming and hygiene products" are soaps, cleaning solutions, 
11.17 	shampoo, toothpaste, mouthwash, antiperspirants, and suntan lotions and sunscreens.
11.18 	(5) "Prescribed" and "prescription" means a direction in the form of an order, 
11.19 	formula, or recipe issued in any form of oral, written, electronic, or other means of 
11.20 	transmission by a duly licensed health care professional.
11.21 	(6) "Prosthetic device" means a replacement, corrective, or supportive device, 
11.22 	including repair and replacement parts, worn on or in the body to:
11.23 	(i) artificially replace a missing portion of the body;
11.24 	(ii) prevent or correct physical deformity or malfunction; or
11.25 	(iii) support a weak or deformed portion of the body.
11.26 	Prosthetic device does not include corrective eyeglasses.

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

11.28 	Sec. 7. Minnesota Statutes 2006, section 297A.995, subdivision 10, is amended to read:
11.29 		Subd. 10.Relief from certain liability. (a) Notwithstanding subdivision 9, sellers 
11.30 	and certified service providers are relieved from liability to the state for having charged 
11.31 	and collected the incorrect amount of sales or use tax resulting from the seller or certified 
11.32 	service provider (1) relying on erroneous data provided by ~~this state~~the commissioner 
11.33 	in the database files on tax rates, boundaries, or taxing jurisdiction assignments, or (2) 
12.1 	relying on erroneous data provided by the state in its taxability matrix concerning the 
12.2 	taxability of products and services.
12.3 	(b) Notwithstanding subdivision 9, sellers and certified service providers are 
12.4 	relieved from liability to the state for having charged and collected the incorrect amount 
12.5 	of sales or use tax resulting from the seller or certified service provider relying on the 
12.6 	certification by the commissioner as to the accuracy of a certified automated system as to 
12.7 	the taxability of product categories. The relief from liability provided by this paragraph 
12.8 	does not apply when the sellers or certified service providers have incorrectly classified 
12.9 	an item or transaction into a product category, unless the item or transaction within a 
12.10 	product category was approved by the commissioner or approved jointly by the states that 
12.11 	are signatories to the agreement. The sellers and certified service providers must revise a 
12.12 	classification within ten days after receipt of notice from the commissioner that an item or 
12.13 	transaction within a product category is incorrectly classified as to its taxability, or they 
12.14 	are not relieved from liability for the incorrect classification following the notification.

12.15 	EFFECTIVE DATE. This section is effective retroactively for sales and purchases 
12.16 	made after December 31, 2007.

12.17 	Sec. 8. Minnesota Statutes 2006, section 297A.995, is amended by adding a 
12.18 	subdivision to read:
12.19 		Subd. 11.Purchaser relief from certain liability. (a) Notwithstanding other 
12.20 	provisions in the law, a purchaser is relieved from liability resulting from having paid 
12.21 	the incorrect amount of sales or use tax if a purchaser, whether or not holding a direct 
12.22 	pay permit, or a purchaser's seller or certified service provider relied on erroneous data 
12.23 	provided by this state in the database files on tax rates, boundaries, taxing jurisdiction 
12.24 	assignments, or in the taxability matrix. After providing an address-based database for 
12.25 	assigning taxing jurisdictions and their associated rates, no relief for errors resulting from 
12.26 	the purchaser's reliance on a database using zip codes is allowed.
12.27 	(b) With respect to reliance on the taxability matrix provided by this state in 
12.28 	paragraph (a), relief is limited to erroneous classifications in the taxability matrix for 
12.29 	items included within the classifications as "taxable," "exempt," "included in sales 
12.30 	price," "excluded from sales price," "included in the definition," and "excluded from 
12.31 	the definition."

12.32 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
12.33 	December 31, 2008.

13.1 	Sec. 9. Minnesota Statutes 2006, section 297A.995, is amended by adding a 
13.2 	subdivision to read:
13.3 		Subd. 12.Database files. For purposes of this section, "database files on tax rates, 
13.4 	boundaries, and taxing jurisdiction assignments" and the "taxability matrix" means those 
13.5 	databases and the taxability matrix required under the agreement.

13.6 	EFFECTIVE DATE. This section is effective retroactively for sales and purchases 
13.7 	made after December 31, 2007.

13.8 	Sec. 10. Minnesota Statutes 2006, section 297B.01, subdivision 7, is amended to read:
13.9 		Subd. 7.Sale, sells, selling, purchase, purchased, or acquired. (a) "Sale," "sells," 
13.10 	"selling," "purchase," "purchased," or "acquired" means any transfer of title of any motor 
13.11 	vehicle, whether absolutely or conditionally, for a consideration in money or by exchange 
13.12 	or barter for any purpose other than resale in the regular course of business.
13.13 	(b) Any motor vehicle utilized by the owner only by leasing such vehicle to others 
13.14 	or by holding it in an effort to so lease it, and which is put to no other use by the owner 
13.15 	other than resale after such lease or effort to lease, shall be considered property purchased 
13.16 	for resale.
13.17 	(c) The terms also shall include any transfer of title or ownership of a motor vehicle 
13.18 	by other means, for or without consideration, except that these terms shall not include:
13.19 	(1) the acquisition of a motor vehicle by inheritance from or by bequest of, a 
13.20 	decedent who owned it;
13.21 	(2) the transfer of a motor vehicle which was previously licensed in the names of 
13.22 	two or more joint tenants and subsequently transferred without monetary consideration to 
13.23 	one or more of the joint tenants;
13.24 	(3) the transfer of a motor vehicle by way of gift between individuals, or gift 
13.25 	from a limited used vehicle dealer licensed under section 168.27, subdivision 4a, to an 
13.26 	individual, when the transfer is with no monetary or other consideration or expectation 
13.27 	of consideration and the parties to the transfer submit an affidavit to that effect at the 
13.28 	time the title transfer is recorded; 
13.29 	(4) the voluntary or involuntary transfer of a motor vehicle between a husband and 
13.30 	wife in a divorce proceeding; or
13.31 	(5) the transfer of a motor vehicle by way of a gift to an organization that is exempt 
13.32 	from federal income taxation under section 501(c)(3) of the Internal Revenue Code, 
13.33 	as amended through December 31, ~~1996~~ 2007, when the motor vehicle will be used 
13.34 	exclusively for religious, charitable, or educational purposes.

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

14.2 	Sec. 11. Minnesota Statutes 2006, section 297B.03, is amended to read:
14.3 	297B.03 EXEMPTIONS.
14.4 	There is specifically exempted from the provisions of this chapter and from 
14.5 	computation of the amount of tax imposed by it the following:
14.6 	(1) purchase or use, including use under a lease purchase agreement or installment 
14.7 	sales contract made pursuant to section 465.71, of any motor vehicle by the United States 
14.8 	and its agencies and instrumentalities and by any person described in and subject to the 
14.9 	conditions provided in section 297A.67, subdivision 11; 
14.10 	(2) purchase or use of any motor vehicle by any person who was a resident of 
14.11 	another state or country at the time of the purchase and who subsequently becomes a 
14.12 	resident of Minnesota, provided the purchase occurred more than 60 days prior to the date 
14.13 	such person began residing in the state of Minnesota and the motor vehicle was registered 
14.14 	in the person's name in the other state or country;
14.15 	(3) purchase or use of any motor vehicle by any person making a valid election to be 
14.16 	taxed under the provisions of section 297A.90; 
14.17 	(4) purchase or use of any motor vehicle previously registered in the state of 
14.18 	Minnesota when such transfer constitutes a transfer within the meaning of section 118, 
14.19 	331, 332, 336, 337, 338, 351, 355, 368, 721, 731, 1031, 1033, or 1563(a) of the Internal 
14.20 	Revenue Code of 1986, as amended through December 31, ~~1999~~ 2007;
14.21 	(5) purchase or use of any vehicle owned by a resident of another state and leased 
14.22 	to a Minnesota-based private or for-hire carrier for regular use in the transportation of 
14.23 	persons or property in interstate commerce provided the vehicle is titled in the state of 
14.24 	the owner or secured party, and that state does not impose a sales tax or sales tax on 
14.25 	motor vehicles used in interstate commerce;
14.26 	(6) purchase or use of a motor vehicle by a private nonprofit or public educational 
14.27 	institution for use as an instructional aid in automotive training programs operated by the 
14.28 	institution. "Automotive training programs" includes motor vehicle body and mechanical 
14.29 	repair courses but does not include driver education programs;
14.30 	(7) purchase of a motor vehicle for use as an ambulance by an ambulance service 
14.31 	licensed under section 144E.10; 
14.32 	(8) purchase of a motor vehicle by or for a public library, as defined in section 
14.33 	134.001, subdivision 2, as a bookmobile or library delivery vehicle; 
14.34 	(9) purchase of a ready-mixed concrete truck;
15.1 	(10) purchase or use of a motor vehicle by a town for use exclusively for road 
15.2 	maintenance, including snowplows and dump trucks, but not including automobiles, 
15.3 	vans, or pickup trucks;
15.4 	(11) purchase or use of a motor vehicle by a corporation, society, association, 
15.5 	foundation, or institution organized and operated exclusively for charitable, religious, 
15.6 	or educational purposes, except a public school, university, or library, but only if the 
15.7 	vehicle is:
15.8 	(i) a truck, as defined in section 168.011, a bus, as defined in section 168.011, or a 
15.9 	passenger automobile, as defined in section 168.011, if the automobile is designed and 
15.10 	used for carrying more than nine persons including the driver; and 
15.11 	(ii) intended to be used primarily to transport tangible personal property or 
15.12 	individuals, other than employees, to whom the organization provides service in 
15.13 	performing its charitable, religious, or educational purpose;
15.14 	(12) purchase of a motor vehicle for use by a transit provider exclusively to provide 
15.15 	transit service is exempt if the transit provider is either (i) receiving financial assistance or 
15.16 	reimbursement under section 174.24 or 473.384, or (ii) operating under section 174.29, 
15.17 	473.388, or 473.405; 
15.18 	(13) purchase or use of a motor vehicle by a qualified business, as defined in section 
15.19 	469.310, located in a job opportunity building zone, if the motor vehicle is principally 
15.20 	garaged in the job opportunity building zone and is primarily used as part of or in direct 
15.21 	support of the person's operations carried on in the job opportunity building zone. The 
15.22 	exemption under this clause applies to sales, if the purchase was made and delivery 
15.23 	received during the duration of the job opportunity building zone. The exemption under 
15.24 	this clause also applies to any local sales and use tax. 

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

15.26 	ARTICLE 3
15.27 	SPECIAL TAXES AND FEES

15.28 	Section 1. Minnesota Statutes 2007 Supplement, section 115A.1314, subdivision 2, 
15.29 	is amended to read:
15.30 		Subd. 2.Creation of account; appropriations. (a) The electronic waste account 
15.31 	is established in the environmental fund. The commissioner of revenue must deposit 
15.32 	receipts from the fee established in subdivision 1 in the account. Any interest earned on 
15.33 	the account must be credited to the account. Money from other sources may be credited to 
15.34 	the account. Beginning in the second program year and continuing each program year 
16.1 	thereafter, as of the last day of each program year, the commissioner of revenue shall 
16.2 	determine the total amount of the variable fees that were collected. By July 15, 2009, and 
16.3 	each July 15 thereafter, the commissioner of the Pollution Control Agency shall inform 
16.4 	the commissioner of revenue of the amount necessary to operate the program in the new 
16.5 	program year. To the extent that the total fees collected by the commissioner of revenue in 
16.6 	connection with this section ~~exceeds~~ exceed the amount the commissioner of the Pollution 
16.7 	Control Agency determines necessary to operate the program for the new program 
16.8 	year, the commissioner of revenue shall refund on a pro rata basis, to all manufacturers 
16.9 	who paid any fees for the previous program year, the amount of fees collected by the 
16.10 	commissioner of revenue in excess of the amount necessary to operate the program for the 
16.11 	new program year. No individual refund is required of amounts of $100 or less for a fiscal 
16.12 	year. Manufacturers who report collections less than 50 percent of their obligation for the 
16.13 	previous program year are not eligible for a refund. Amounts not refunded pursuant to this 
16.14 	paragraph shall remain in the account. The commissioner of revenue shall issue refunds 
16.15 	by August 10. In lieu of issuing a refund, the commissioner of revenue may grant credit 
16.16 	against a manufacturer's variable fee due by September 1.
16.17 	(b) Until June 30, 2009, money in the account is annually appropriated to the 
16.18 	Pollution Control Agency:
16.19 	(1) for the purpose of implementing sections 115A.1312 to 115A.1330, including 
16.20 	transfer to the commissioner of revenue to carry out the department's duties under 
16.21 	section 115A.1320, subdivision 2, and transfer to the commissioner of administration for 
16.22 	responsibilities under section 115A.1324; and 
16.23 	(2) to the commissioner of the Pollution Control Agency to be distributed on a 
16.24 	competitive basis through contracts with counties outside the 11-county metropolitan 
16.25 	area, as defined in paragraph (c), and with private entities that collect for recycling 
16.26 	covered electronic devices in counties outside the 11-county metropolitan area, where the 
16.27 	collection and recycling is consistent with the respective county's solid waste plan, for 
16.28 	the purpose of carrying out the activities under sections 115A.1312 to 115A.1330. In 
16.29 	awarding competitive grants under this clause, the commissioner must give preference to 
16.30 	counties and private entities that are working cooperatively with manufacturers to help 
16.31 	them meet their recycling obligations under section 115A.1318, subdivision 1.
16.32 	(c) The 11-county metropolitan area consists of the counties of Anoka, Carver, 
16.33 	Chisago, Dakota, Hennepin, Isanti, Ramsey, Scott, Sherburne, Washington, and Wright.

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

16.35 	Sec. 2. Minnesota Statutes 2006, section 270C.56, subdivision 1, is amended to read:
17.1 		Subdivision 1.Liability imposed. A person who, either singly or jointly with 
17.2 	others, has the control of, supervision of, or responsibility for filing returns or reports, 
17.3 	paying taxes, or collecting or withholding and remitting taxes and who fails to do so, or a 
17.4 	person who is liable under any other law, is liable for the payment of taxes, penalties, and 
17.5 	interest arising under chapters 295, 296A, 297A, 297F, and 297G, or sections 256.9658, 
17.6 	290.92 and 297E.02.

17.7 	EFFECTIVE DATE. This section is effective for fees due after June 30, 2008.

17.8 	Sec. 3. Minnesota Statutes 2006, section 287.20, subdivision 3a, is amended to read:
17.9 		Subd. 3a.Designated transfer. "Designated transfer" means any of the following:
17.10 	(1) a transfer between (i) an entity owned by a sole owner, and (ii) that sole owner;
17.11 	(2) a transfer between (i) an entity in which a husband, a wife, or both are the sole 
17.12 	owners, and (ii) the husband, wife, or both;
17.13 	(3) a transfer between (i) an entity with multiple co-owners, and (ii) all of the 
17.14 	co-owners, so long as each of the co-owners maintains the same percentage ownership 
17.15 	interest in the transferred real property, whether directly or through ownership of a 
17.16 	percentage of the entity;
17.17 	(4) a transfer between (i) a revocable trust, and (ii) the grantor or grantors of the 
17.18 	revocable trust; or
17.19 	(5) a transfer of substantially all of the assets of one or more entities pursuant to a 
17.20 	reorganization, as defined in section 287.20, subdivision 9.
17.21 	For purposes of this definition of designated transfer, an interest in an entity that is 
17.22 	owned, directly or indirectly, by or for another entity shall be considered as being owned 
17.23 	proportionately by or for the owners of the other entity under provisions similar to those 
17.24 	of section 267(c)(1) and (5) of the Internal Revenue Code ~~of 1986, as amended through~~ 
17.25 	~~December 31, 2004~~.

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

17.27 	Sec. 4. Minnesota Statutes 2006, section 287.20, subdivision 9, is amended to read:
17.28 		Subd. 9.Reorganization. "Reorganization" means the transfer of substantially all 
17.29 	of the assets of a corporation, a limited liability company, or a partnership not in the usual 
17.30 	or regular course of business if at the time of the transfer the transfer qualifies as: (i) a 
17.31 	corporate reorganization under section 368(a) of the Internal Revenue Code ~~of 1986, as~~ 
17.32 	~~amended through December 31, 2004~~; or (ii) a transfer from a partnership to another 
18.1 	partnership when the transferee is treated as a continuation of the transferor under section 
18.2 	708 of the Internal Revenue Code ~~of 1986, as amended through December 31, 2004~~.

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

18.4 	Sec. 5. Minnesota Statutes 2006, section 287.20, is amended by adding a subdivision 
18.5 	to read:
18.6 		Subd. 10.Internal Revenue Code. Unless specifically defined otherwise, "Internal 
18.7 	Revenue Code" means the Internal Revenue Code of 1986, as amended through December 
18.8 	31, 2007.

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

18.10 	Sec. 6. Minnesota Statutes 2006, section 295.50, subdivision 4, is amended to read:
18.11 		Subd. 4.Health care provider. (a) "Health care provider" means:
18.12 	(1) a person whose health care occupation is regulated or required to be regulated by 
18.13 	the state of Minnesota furnishing any or all of the following goods or services directly to a 
18.14 	patient or consumer: medical, surgical, optical, visual, dental, hearing, nursing services, 
18.15 	drugs, laboratory, diagnostic or therapeutic services;
18.16 	(2) a person who provides goods and services not listed in clause (1) that qualify for 
18.17 	reimbursement under the medical assistance program provided under chapter 256B;
18.18 	(3) a staff model health plan company;
18.19 	(4) an ambulance service required to be licensed; or
18.20 	(5) a person who sells or repairs hearing aids and related equipment or prescription 
18.21 	eyewear.
18.22 	(b) Health care provider does not include:
18.23 	(1) hospitals; medical supplies distributors, except as specified under paragraph 
18.24 	(a), clause (5); nursing homes licensed under chapter 144A or licensed in any other 
18.25 	jurisdiction; wholesale drug distributors; pharmacies; surgical centers; bus and taxicab 
18.26 	transportation, or any other providers of transportation services other than ambulance 
18.27 	services required to be licensed; supervised living facilities for persons with developmental 
18.28 	disabilities, licensed under Minnesota Rules, parts 4665.0100 to 4665.9900; housing 
18.29 	with services establishments required to be registered under chapter 144D; board 
18.30 	and lodging establishments providing only custodial services that are licensed under 
18.31 	chapter 157 and registered under section 157.17 to provide supportive services or health 
18.32 	supervision services; adult foster homes as defined in Minnesota Rules, part 9555.5105; 
18.33 	day training and habilitation services for adults with developmental disabilities as defined 
19.1 	in section 252.41, subdivision 3; boarding care homes, as defined in Minnesota Rules, part 
19.2 	4655.0100; and adult day care centers as defined in Minnesota Rules, part 9555.9600; 
19.3 	(2) home health agencies as defined in Minnesota Rules, part 9505.0175, subpart 
19.4 	15; a person providing personal care services and supervision of personal care services 
19.5 	as defined in Minnesota Rules, part 9505.0335; a person providing private duty nursing 
19.6 	services as defined in Minnesota Rules, part 9505.0360; and home care providers required 
19.7 	to be licensed under chapter 144A;
19.8 	(3) a person who employs health care providers solely for the purpose of providing 
19.9 	patient services to its employees; ~~and~~
19.10 	(4) an educational institution that employs health care providers solely for the 
19.11 	purpose of providing patient services to its students if the institution does not receive fee 
19.12 	for service payments or payments for extended coverage~~.~~; and
19.13 	(5) a person who receives all payments for patient services from health care 
19.14 	providers, surgical centers, or hospitals for goods and services that are taxable to the 
19.15 	paying health care providers, surgical centers, or hospitals, as provided under section 
19.16 	295.53, subdivision 1, clause (3) or (4), or from a source of funds that is exempt from tax 
19.17 	under this chapter.

19.18 	EFFECTIVE DATE. Paragraph (b), clause (1) is effective the day following final 
19.19 	enactment. Paragraph (b), clause (5) is effective for payments received after June 30, 2008.

19.20 	Sec. 7. Minnesota Statutes 2006, section 295.52, subdivision 4, is amended to read:
19.21 		Subd. 4.Use tax; prescription drugs. (a) A person that receives prescription 
19.22 	drugs for resale or use in Minnesota, other than from a wholesale drug distributor that 
19.23 	is subject to tax under subdivision 3, is subject to a tax equal to the price paid to the 
19.24 	wholesale drug distributor multiplied by the tax percentage specified in this section. When 
19.25 	a person manufactures the drugs, the person is subject to tax equal to the cost incurred 
19.26 	by the person to manufacture the drugs multiplied by the tax percentage specified in this 
19.27 	section. Liability for the tax is incurred when prescription drugs are received or delivered 
19.28 	in Minnesota by the person.
19.29 	(b) A person that receives prescription drugs for use in Minnesota from a nonresident 
19.30 	pharmacy required to be registered under section 151.19 is subject to a tax equal to 
19.31 	the price paid by the nonresident pharmacy to the wholesale drug distributor or the 
19.32 	price received by the nonresident pharmacy, whichever is lower, multiplied by the tax 
19.33 	percentage specified in this section. Liability for the tax is incurred when prescription 
19.34 	drugs are received in Minnesota by the person.
20.1 	(c) A tax imposed under this subdivision does not apply to purchases by an 
20.2 	individual for personal consumption.

20.3 	EFFECTIVE DATE. This section is effective for drug purchases after June 30, 
20.4 	2008.

20.5 	Sec. 8. Minnesota Statutes 2006, section 295.53, subdivision 4a, is amended to read:
20.6 		Subd. 4a.Credit for research. (a) In addition to the exemptions allowed under 
20.7 	subdivision 1, a hospital or health care provider may claim an annual credit against the 
20.8 	total amount of tax, if any, the hospital or health care provider owes for that calendar year 
20.9 	under sections 295.50 to 295.57. The credit shall equal 2.5 percent of revenues for patient 
20.10 	services used to fund expenditures for qualifying research conducted by an allowable 
20.11 	research program. The amount of the credit shall not exceed the tax liability of the hospital 
20.12 	or health care provider under sections 295.50 to 295.57. 
20.13 	(b) For purposes of this subdivision, the following requirements apply:
20.14 	(1) expenditures must be for program costs of qualifying research conducted by 
20.15 	an allowable research program;
20.16 	(2) an allowable research program must be a formal program of medical and health 
20.17 	care research conducted by an entity which is exempt under section 501(c)(3) of the 
20.18 	Internal Revenue Code ~~of 1986~~, as amended through December 31, 2007, or is owned and 
20.19 	operated under authority of a governmental unit;
20.20 	(3) qualifying research must:
20.21 	(A) be approved in writing by the governing body of the hospital or health care 
20.22 	provider which is taking the deduction under this subdivision;
20.23 	(B) have as its purpose the development of new knowledge in basic or applied 
20.24 	science relating to the diagnosis and treatment of conditions affecting the human body;
20.25 	(C) be subject to review by individuals with expertise in the subject matter of the 
20.26 	proposed study but who have no financial interest in the proposed study and are not 
20.27 	involved in the conduct of the proposed study; and
20.28 	(D) be subject to review and supervision by an institutional review board operating 
20.29 	in conformity with federal regulations if the research involves human subjects or 
20.30 	an institutional animal care and use committee operating in conformity with federal 
20.31 	regulations if the research involves animal subjects. Research expenses are not exempt if 
20.32 	the study is a routine evaluation of health care methods or products used in a particular 
20.33 	setting conducted for the purpose of making a management decision. Costs of clinical 
20.34 	research activities paid directly for the benefit of an individual patient are excluded from 
21.1 	this exemption. Basic research in fields including biochemistry, molecular biology, and 
21.2 	physiology are also included if such programs are subject to a peer review process.
21.3 	(c) No credit shall be allowed under this subdivision for any revenue received by the 
21.4 	hospital or health care provider in the form of a grant, gift, or otherwise, whether from a 
21.5 	government or nongovernment source, on which the tax liability under section 295.52 is 
21.6 	not imposed. 
21.7 	(d) The taxpayer shall apply for the credit under this section on the annual return 
21.8 	under section 295.55, subdivision 5. 
21.9 	(e) Beginning September 1, 2001, if the actual or estimated amount paid under 
21.10 	this section for the calendar year exceeds $2,500,000, the commissioner of finance shall 
21.11 	determine the rate of the research credit for the following calendar year to the nearest 
21.12 	one-half percent so that refunds paid under this section will most closely equal $2,500,000. 
21.13 	The commissioner of finance shall publish in the State Register by October 1 of each year 
21.14 	the rate of the credit for the following calendar year. A determination under this section 
21.15 	is not subject to the rulemaking provisions of chapter 14.

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

21.17 	Sec. 9. Minnesota Statutes 2006, section 296A.07, subdivision 4, is amended to read:
21.18 		Subd. 4.Exemptions. The provisions of subdivision 1 do not apply to gasoline or 
21.19 	denatured ethanol purchased by:
21.20 	(1) a transit system or transit provider receiving financial assistance or 
21.21 	reimbursement under section 174.24, 256B.0625, subdivision 17, or 473.384; ~~or~~
21.22 	(2) an ambulance service licensed under chapter 144E; or
21.23 	(3) a licensed distributor to be delivered to a terminal for use in blending.

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

21.25 	Sec. 10. Minnesota Statutes 2006, section 296A.08, subdivision 3, is amended to read:
21.26 		Subd. 3.Exemptions. The provisions of subdivisions 1 and 2 do not apply to 
21.27 	special fuel or alternative fuels purchased by:
21.28 	(1) a transit system or transit provider receiving financial assistance or 
21.29 	reimbursement under section 174.24, 256B.0625, subdivision 17, or 473.384; ~~or~~
21.30 	(2) an ambulance service licensed under chapter 144E; or
21.31 	(3) a licensed distributor to be delivered to a terminal for use in blending.

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

22.1 	Sec. 11. Minnesota Statutes 2006, section 296A.16, subdivision 2, is amended to read:
22.2 		Subd. 2.Fuel used in other vehicle; claim for refund. Any person who buys and 
22.3 	uses gasoline for a qualifying purpose other than use in motor vehicles, snowmobiles 
22.4 	except as provided in clause (2), or motorboats, or special fuel for a qualifying purpose 
22.5 	other than use in licensed motor vehicles, and who paid the tax directly or indirectly 
22.6 	through the amount of the tax being included in the price of the gasoline or special fuel, or 
22.7 	otherwise, shall be reimbursed and repaid the amount of the tax paid upon filing with the 
22.8 	commissioner a claim for refund in the form and manner prescribed by the commissioner, 
22.9 	and containing the information the commissioner shall require. By signing any such claim 
22.10 	which is false or fraudulent, the applicant shall be subject to the penalties provided in this 
22.11 	chapter for knowingly making a false claim. The claim shall set forth the total amount 
22.12 	of the gasoline so purchased and used by the applicant other than in motor vehicles, or 
22.13 	special fuel purchased and used by the applicant other than in licensed motor vehicles, 
22.14 	and shall state when and for what purpose it was used. When a claim contains an error 
22.15 	in computation or preparation, the commissioner is authorized to adjust the claim in 
22.16 	accordance with the evidence shown on the claim or other information available to the 
22.17 	commissioner. The commissioner, on being satisfied that the claimant is entitled to the 
22.18 	payments, shall approve the claim and transmit it to the commissioner of finance. The 
22.19 	words "gasoline" or "special fuel" as used in this subdivision do not include aviation 
22.20 	gasoline or special fuel for aircraft. Gasoline or special fuel bought and used for a 
22.21 	"qualifying purpose" means:
22.22 	(1) Gasoline or special fuel used in carrying on a trade or business, used on a farm 
22.23 	situated in Minnesota, and used for a farming purpose. "Farm" and "farming purpose" 
22.24 	have the meanings given them in section 6420(c)(2), (3), and (4) of the Internal Revenue 
22.25 	Code of 1986, as amended through December 31, ~~1997~~ 2007.
22.26 	(2) Gasoline or special fuel used for off-highway business use.
22.27 	(i) "Off-highway business use" means any use off the public highway by a person in 
22.28 	that person's trade, business, or activity for the production of income.
22.29 	(ii) Off-highway business use includes use of a passenger snowmobile off the public 
22.30 	highways as part of the operations of a resort as defined in section 157.15, subdivision 11; 
22.31 	and use of gasoline or special fuel to operate a power takeoff unit on a vehicle, but not 
22.32 	including fuel consumed during idling time. 
22.33 	(iii) Off-highway business use does not include use as a fuel in a motor vehicle 
22.34 	which, at the time of use, is registered or is required to be registered for highway use under 
22.35 	the laws of any state or foreign country; or use of a licensed motor vehicle fuel tank in lieu 
22.36 	of a separate storage tank for storing fuel to be used for a qualifying purpose, as defined in 
23.1 	this section. Fuel purchased to be used for a qualifying purpose cannot be placed in the 
23.2 	fuel tank of a licensed motor vehicle and must be stored in a separate supply tank.
23.3 	(3) Gasoline or special fuel placed in the fuel tanks of new motor vehicles, 
23.4 	manufactured in Minnesota, and shipped by interstate carrier to destinations in other 
23.5 	states or foreign countries.

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

23.7 	Sec. 12. Minnesota Statutes 2006, section 297F.01, subdivision 8, is amended to read:
23.8 		Subd. 8.Internal Revenue Code. Unless specifically defined otherwise, "Internal 
23.9 	Revenue Code" means the Internal Revenue Code of 1986, as amended through December 
23.10 	31, ~~1996~~ 2007.

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

23.12 	Sec. 13. Minnesota Statutes 2006, section 297F.21, subdivision 1, is amended to read:
23.13 		Subdivision 1.Contraband defined. The following are declared to be contraband 
23.14 	and therefore subject to civil and criminal penalties under this chapter:
23.15 	(a) Cigarette packages which do not have stamps affixed to them as provided in this 
23.16 	chapter, including but not limited to (i) packages with illegible stamps and packages with 
23.17 	stamps that are not complete or whole even if the stamps are legible, and (ii) all devices 
23.18 	for the vending of cigarettes in which packages as defined in item (i) are found, including 
23.19 	all contents contained within the devices.
23.20 	(b) A device for the vending of cigarettes and all packages of cigarettes, where the 
23.21 	device does not afford at least partial visibility of contents. Where any package exposed 
23.22 	to view does not carry the stamp required by this chapter, it shall be presumed that all 
23.23 	packages contained in the device are unstamped and contraband.
23.24 	(c) A device for the vending of cigarettes to which the commissioner or authorized 
23.25 	agents have been denied access for the inspection of contents. In lieu of seizure, the 
23.26 	commissioner or an agent may seal the device to prevent its use until inspection of 
23.27 	contents is permitted.
23.28 	(d) A device for the vending of cigarettes which does not carry the name and address 
23.29 	of the owner, plainly marked and visible from the front of the machine.
23.30 	(e) A device including, but not limited to, motor vehicles, trailers, snowmobiles, 
23.31 	airplanes, and boats used with the knowledge of the owner or of a person operating with 
23.32 	the consent of the owner for the storage or transportation of more than 5,000 cigarettes 
23.33 	which are contraband under this subdivision. When cigarettes are being transported in 
24.1 	the course of interstate commerce, or are in movement from either a public warehouse to 
24.2 	a distributor upon orders from a manufacturer or distributor, or from one distributor to 
24.3 	another, the cigarettes are not contraband, notwithstanding the provisions of clause (a).
24.4 	(f) A device including, but not limited to, motor vehicles, trailers, snowmobiles, 
24.5 	airplanes, and boats used with the knowledge of the owner, or of a person operating with 
24.6 	the consent of the owner, for the storage or transportation of untaxed tobacco products 
24.7 	intended for sale in Minnesota other than those in the possession of a licensed distributor 
24.8 	on or before the due date for payment of the tax under section 297F.09, subdivision 2. 
24.9 	(g) Cigarette packages or tobacco products obtained from an unlicensed seller.
24.10 	(h) Cigarette packages offered for sale or held as inventory in violation of section 
24.11 	297F.20, subdivision 7. 
24.12 	(i) Tobacco products on which the tax has not been paid by a licensed distributor.
24.13 	(j) Any cigarette packages or tobacco products offered for sale or held as inventory 
24.14 	for which there is not an invoice from a licensed seller as required under section 297F.13, 
24.15 	subdivision 4. 
24.16 	(k) Cigarette packages which have been imported into the United States in violation 
24.17 	of United States Code, title 26, section 5754. All cigarettes held in violation of that section 
24.18 	shall be presumed to have entered the United States after December 31, 1999, in the 
24.19 	absence of proof to the contrary.
24.20 	(l) Cigarettes and cigarette packaging which are not in compliance with fire safety 
24.21 	requirements of sections 299F.850 to 299F.859.

24.22 	EFFECTIVE DATE. Property added in paragraph (l) of this section is contraband 
24.23 	effective December 1, 2008.

24.24 	Sec. 14. Minnesota Statutes 2006, section 297G.01, subdivision 9, is amended to read:
24.25 		Subd. 9.Internal Revenue Code. Unless specifically defined otherwise, "Internal 
24.26 	Revenue Code" means the Internal Revenue Code of 1986, as amended through December 
24.27 	31, ~~1996~~ 2007.

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

24.29 	Sec. 15. Minnesota Statutes 2006, section 297H.09, is amended to read:
24.30 	297H.09 BAD DEBTS.
24.31 	The remitter of the solid waste management tax may offset against the tax payable, 
24.32 	with respect to any reporting period, the amount of tax imposed by this chapter previously 
24.33 	remitted to the commissioner of revenue which qualified as a bad debt under section 
25.1 	166(a) of the Internal Revenue Code, as amended through December 31, ~~1993~~ 2007, 
25.2 	during such reporting period, but only in proportion to the portion of such debt which 
25.3 	became uncollectable. This section applies only to accrual basis remitters that remit tax 
25.4 	before it is collected and to the extent they are unable to collect the tax.

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

25.6 	Sec. 16. Minnesota Statutes 2006, section 297I.05, subdivision 12, is amended to read:
25.7 		Subd. 12.Other entities. (a) A tax is imposed equal to two percent of:
25.8 	(1) gross premiums less return premiums written for risks resident or located in 
25.9 	Minnesota by a risk retention group;
25.10 	(2) gross premiums less return premiums received by an attorney in fact acting 
25.11 	in accordance with chapter 71A;
25.12 	(3) gross premiums less return premiums received pursuant to assigned risk policies 
25.13 	and contracts of coverage under chapter 79;
25.14 	(4) the direct funded premium received by the reinsurance association under section 
25.15 	79.34 from self-insurers approved under section 176.181 and political subdivisions that 
25.16 	self-insure; and
25.17 	~~(5) gross premiums less return premiums received by a nonprofit health service plan~~ 
25.18 	~~corporation authorized under chapter 62C; and~~
25.19 	~~(6)~~ (5) gross premiums less return premiums paid to an insurer other than a licensed 
25.20 	insurance company or a surplus lines licensee for coverage of risks resident or located in 
25.21 	Minnesota by a purchasing group or any members of the purchasing group to a broker or 
25.22 	agent for the purchasing group.
25.23 	(b) A tax is imposed on a joint self-insurance plan operating under chapter 60F. The 
25.24 	rate of tax is equal to two percent of the total amount of claims paid during the fund year, 
25.25 	with no deduction for claims wholly or partially reimbursed through stop-loss insurance.
25.26 	(c) A tax is imposed on a joint self-insurance plan operating under chapter 62H. 
25.27 	The rate of tax is equal to two percent of the total amount of claims paid during the 
25.28 	fund's fiscal year, with no deduction for claims wholly or partially reimbursed through 
25.29 	stop-loss insurance.
25.30 	(d) A tax is imposed equal to the tax imposed under section 297I.05, subdivision 5, 
25.31 	on the gross premiums less return premiums on all coverages received by an accountable 
25.32 	provider network or agents of an accountable provider network in Minnesota, in cash or 
25.33 	otherwise, during the year. 

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

26.1 	ARTICLE 4
26.2 	PROPERTY TAXES AND AIDS

26.3 	Section 1. Minnesota Statutes 2006, section 13.51, subdivision 3, is amended to read:
26.4 		Subd. 3.Data on income of individuals. Income information on individuals 
26.5 	collected and maintained by political subdivisions to determine eligibility of property for 
26.6 	class 4d under ~~section 273.126~~ sections 273.128 and 273.13, is private data on individuals 
26.7 	as defined in section 13.02, subdivision 12. 

26.8 	EFFECTIVE DATE. This section is effective for data collected or maintained by 
26.9 	political subdivisions beginning the day following final enactment.

26.10 	Sec. 2. Minnesota Statutes 2006, section 13.585, subdivision 5, is amended to read:
26.11 		Subd. 5.Private data on individuals. Income information on individuals collected 
26.12 	and maintained by a housing agency to determine eligibility of property for class 4d 
26.13 	under sections ~~273.126~~ 273.128 and 273.13, is private data on individuals as defined in 
26.14 	section 13.02, subdivision 12. The data may be disclosed to the county and local assessors 
26.15 	responsible for determining eligibility of the property for classification 4d. 

26.16 	EFFECTIVE DATE. This section is effective for data collected or maintained by a 
26.17 	housing agency beginning the day following final enactment.

26.18 	Sec. 3. Minnesota Statutes 2006, section 163.051, subdivision 5, is amended to read:
26.19 		Subd. 5.Effect on road and bridge levy. For taxes payable in the same year 
26.20 	that the county first receives tax revenues under this section, the county auditor of each 
26.21 	metropolitan county shall reduce the amount of the property taxes levied pursuant to law 
26.22 	~~in 1973 for collection in 1974,~~ by the board of commissioners of such county for the 
26.23 	county road and bridge fund, by the ~~following amount: Anoka County, $341,750; Carver~~ 
26.24 	~~County, $86,725; Dakota County, $386,165; Hennepin County, $2,728,425; Ramsey~~ 
26.25 	~~County, $1,276,815; Scott County, $104,805; Washington County, $227,220~~ estimated 
26.26 	wheelage tax revenues to be received by the county in that taxes payable year, and shall 
26.27 	spread only the balance thereof on the tax rolls for collection ~~in 1972~~. The county auditor 
26.28 	shall also reduce the amount of such taxes levied pursuant to law ~~in 1972 and any~~ 
26.29 	~~subsequent year,~~ for collection in the respective ensuing years, by the amount of wheelage 
26.30 	taxes received by the county in the 12 months immediately preceding ~~such levy~~ May 1 of 
26.31 	the year preceding the taxes payable year.

27.1 	EFFECTIVE DATE. This section is effective retroactively beginning the day 
27.2 	following final enactment for taxes payable in 2007 and thereafter.

27.3 	Sec. 4. Minnesota Statutes 2006, section 272.02, subdivision 13, is amended to read:
27.4 		Subd. 13.Emergency shelters for victims of domestic abuse. Property used in 
27.5 	a continuous program to provide emergency shelter for victims of domestic abuse is 
27.6 	exempt, provided the organization that owns and sponsors the shelter is exempt from 
27.7 	federal income taxation pursuant to section 501(c)(3) of the Internal Revenue Code 
27.8 	~~of 1986, as amended through December 31, 1992~~, notwithstanding the fact that the 
27.9 	sponsoring organization receives funding under Section 8 of the United States Housing 
27.10 	Act of 1937, as amended.

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

27.12 	Sec. 5. Minnesota Statutes 2006, section 272.02, subdivision 20, is amended to read:
27.13 		Subd. 20.Transitional housing facilities. Transitional housing facilities are 
27.14 	exempt. "Transitional housing facility" means a facility that meets the following 
27.15 	requirements. (i) It provides temporary housing to individuals, couples, or families. (ii) 
27.16 	It has the purpose of reuniting families and enabling parents or individuals to obtain 
27.17 	self-sufficiency, advance their education, get job training, or become employed in jobs that 
27.18 	provide a living wage. (iii) It provides support services such as child care, work readiness 
27.19 	training, and career development counseling; and a self-sufficiency program with periodic 
27.20 	monitoring of each resident's progress in completing the program's goals. (iv) It provides 
27.21 	services to a resident of the facility for at least three months but no longer than three 
27.22 	years, except residents enrolled in an educational or vocational institution or job training 
27.23 	program. These residents may receive services during the time they are enrolled but in no 
27.24 	event longer than four years. (v) It is owned and operated or under lease from a unit of 
27.25 	government or governmental agency under a property disposition program and operated by 
27.26 	one or more organizations exempt from federal income tax under section 501(c)(3) of the 
27.27 	Internal Revenue Code ~~of 1986, as amended through December 31, 1992~~. This exemption 
27.28 	applies notwithstanding the fact that the sponsoring organization receives financing by a 
27.29 	direct federal loan or federally insured loan or a loan made by the Minnesota Housing 
27.30 	Finance Agency under the provisions of either Title II of the National Housing Act or the 
27.31 	Minnesota Housing Finance Agency Law of 1971, as amended through December 31, 
27.32 	2007, or rules promulgated by the agency pursuant to it, and notwithstanding the fact 
27.33 	that the sponsoring organization receives funding under Section 8 of the United States 
27.34 	Housing Act of 1937, as amended through December 31, 2007.

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

28.2 	Sec. 6. Minnesota Statutes 2006, section 272.02, subdivision 21, is amended to read:
28.3 		Subd. 21.Property used to provide computing resources to University of 
28.4 	Minnesota. Real and personal property, including leasehold or other personal property 
28.5 	interests, is exempt if it is owned and operated by a corporation of which more than 50 
28.6 	percent of the total voting power of the stock of the corporation is owned collectively by: 
28.7 	(i) the Board of Regents of the University of Minnesota, (ii) the University of Minnesota 
28.8 	Foundation, an organization exempt from federal income taxation under section 501(c)(3) 
28.9 	of the Internal Revenue Code ~~of 1986, as amended through December 31, 1992~~, and (iii) 
28.10 	a corporation organized under chapter 317A, which by its articles of incorporation is 
28.11 	prohibited from providing pecuniary gain to any person or entity other than the regents 
28.12 	of the University of Minnesota; which property is used primarily to manage or provide 
28.13 	goods, services, or facilities utilizing or relating to large-scale advanced scientific 
28.14 	computing resources to the regents of the University of Minnesota and others.

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

28.16 	Sec. 7. Minnesota Statutes 2006, section 272.02, subdivision 27, is amended to read:
28.17 		Subd. 27.Superior National Forest; recreational property for use by disabled 
28.18 	veterans. Real and personal property is exempt if it is located in the Superior National 
28.19 	Forest, and owned or leased and operated by a nonprofit organization that is exempt 
28.20 	from federal income taxation under section 501(c)(3) of the Internal Revenue Code ~~of~~ 
28.21 	~~1986, as amended through December 31, 1992~~, and primarily used to provide recreational 
28.22 	opportunities for disabled veterans and their families.

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

28.24 	Sec. 8. Minnesota Statutes 2006, section 272.02, subdivision 31, is amended to read:
28.25 		Subd. 31.Business incubator property. Property owned by a nonprofit charitable 
28.26 	organization that qualifies for tax exemption under section 501(c)(3) of the Internal 
28.27 	Revenue Code ~~of 1986, as amended through December 31, 1997~~, that is intended to be 
28.28 	used as a business incubator in a high-unemployment county, is exempt. As used in this 
28.29 	subdivision, a "business incubator" is a facility used for the development of nonretail 
28.30 	businesses, offering access to equipment, space, services, and advice to the tenant 
28.31 	businesses, for the purpose of encouraging economic development, diversification, and 
28.32 	job creation in the area served by the organization, and "high-unemployment county" is a 
29.1 	county that had an average annual unemployment rate of 7.9 percent or greater in 1997. 
29.2 	Property that qualifies for the exemption under this subdivision is limited to no more than 
29.3 	two contiguous parcels and structures that do not exceed in the aggregate 40,000 square 
29.4 	feet. This exemption expires after taxes payable in 2011.

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

29.6 	Sec. 9. Minnesota Statutes 2006, section 272.02, subdivision 38, is amended to read:
29.7 		Subd. 38.Conversion to exempt or taxable uses. (a) Any property, except 
29.8 	property taxed as personal property under section 273.125, that is exempt from taxation on 
29.9 	January 2 of any year which, due to sale or other reason, loses its exemption prior to July 1 
29.10 	of any year, shall be placed on the current assessment rolls for that year.
29.11 	The valuation shall be determined with respect to its value on January 2 of such 
29.12 	year. The classification shall be based upon the use to which the property was put by the 
29.13 	purchaser, or in the event the purchaser has not utilized the property by July 1, the intended 
29.14 	use of the property, determined by the county assessor, based upon all relevant facts.
29.15 	(b) Property, except property taxed as personal property under section 273.125, that 
29.16 	is subject to tax on January 2 that is acquired before July 1 of the year is exempt for that 
29.17 	assessment year if the property is to be used for an exempt purpose under subdivisions 2 
29.18 	to 8.
29.19 	(c) Property which forfeits to the state for nonpayment of real estate taxes on or 
29.20 	before December 31 in an assessment year, shall be removed from the assessment rolls for 
29.21 	that assessment year. Forfeited property that is repurchased, or sold at a public or private 
29.22 	sale, on or before December 31 of an assessment year shall be placed on the assessment 
29.23 	rolls for that year's assessment.

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

29.25 	Sec. 10. Minnesota Statutes 2006, section 272.02, subdivision 49, is amended to read:
29.26 		Subd. 49.Agricultural historical society property. Property is exempt from 
29.27 	taxation if it is owned by a nonprofit charitable or educational organization that qualifies 
29.28 	for exemption under section 501(c)(3) of the Internal Revenue Code ~~of 1986, as amended~~ 
29.29 	~~through December 31, 2000,~~ and meets the following criteria:
29.30 	(1) the property is primarily used for storing and exhibiting tools, equipment, and 
29.31 	artifacts useful in providing an understanding of local or regional agricultural history. 
29.32 	Primary use is determined each year based on the number of days the property is used 
29.33 	solely for storage and exhibition purposes;
30.1 	(2) the property is limited to a maximum of 20 acres per owner per county, but 
30.2 	includes the land and any taxable structures, fixtures, and equipment on the land;
30.3 	(3) the property is not used for a revenue-producing activity for more than ten days 
30.4 	in each calendar year; and
30.5 	(4) the property is not used for residential purposes on either a temporary or 
30.6 	permanent basis.

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

30.8 	Sec. 11. Minnesota Statutes 2006, section 272.03, subdivision 3, is amended to read:
30.9 		Subd. 3.Construction of terms. For the purposes of chapters 270 to 284, unless a 
30.10 	different meaning is indicated by the context, the words, phrases, and terms defined in 
30.11 	subdivisions 4 to ~~11~~13 shall have the meanings given them.

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

30.13 	Sec. 12. Minnesota Statutes 2006, section 272.03, is amended by adding a subdivision 
30.14 	to read:
30.15 		Subd. 13.Internal Revenue Code. Unless specifically defined otherwise, "Internal 
30.16 	Revenue Code" means the Internal Revenue Code of 1986, as amended through December 
30.17 	31, 2007.

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

30.19 	Sec. 13. [273.105] INTERNAL REVENUE CODE.
30.20 	Unless specifically defined otherwise, for purposes of this chapter, "Internal Revenue 
30.21 	Code" means the Internal Revenue Code of 1986, as amended through December 31, 2007.

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

30.23 	Sec. 14. Minnesota Statutes 2006, section 273.11, subdivision 8, is amended to read:
30.24 		Subd. 8.Limited equity cooperative apartments. For the purposes of this 
30.25 	subdivision, the terms defined in this subdivision have the meanings given them.
30.26 	A "limited equity cooperative" is a corporation organized under chapter 308A or 
30.27 	308B, which has as its primary purpose the provision of housing and related services to 
30.28 	its members which meets one of the following criteria with respect to the income of its 
30.29 	members: (1) a minimum of 75 percent of members must have incomes at or less than 
30.30 	90 percent of area median income, (2) a minimum of 40 percent of members must have 
31.1 	incomes at or less than 60 percent of area median income, or (3) a minimum of 20 percent 
31.2 	of members must have incomes at or less than 50 percent of area median income. For 
31.3 	purposes of this clause, "member income" shall mean the income of a member existing at 
31.4 	the time the member acquires cooperative membership, and median income shall mean 
31.5 	the St. Paul-Minneapolis metropolitan area median income as determined by the United 
31.6 	States Department of Housing and Urban Development. It must also meet the following 
31.7 	requirements:
31.8 	(a) The articles of incorporation set the sale price of occupancy entitling cooperative 
31.9 	shares or memberships at no more than a transfer value determined as provided in the 
31.10 	articles. That value may not exceed the sum of the following:
31.11 	(1) the consideration paid for the membership or shares by the first occupant of the 
31.12 	unit, as shown in the records of the corporation;
31.13 	(2) the fair market value, as shown in the records of the corporation, of any 
31.14 	improvements to the real property that were installed at the sole expense of the member 
31.15 	with the prior approval of the board of directors;
31.16 	(3) accumulated interest, or an inflation allowance not to exceed the greater of a ten 
31.17 	percent annual noncompounded increase on the consideration paid for the membership or 
31.18 	share by the first occupant of the unit, or the amount that would have been paid on that 
31.19 	consideration if interest had been paid on it at the rate of the percentage increase in the 
31.20 	revised Consumer Price Index for All Urban Consumers for the Minneapolis-St. Paul 
31.21 	metropolitan area prepared by the United States Department of Labor, provided that the 
31.22 	amount determined pursuant to this clause may not exceed $500 for each year or fraction 
31.23 	of a year the membership or share was owned; plus
31.24 	(4) real property capital contributions shown in the records of the corporation to 
31.25 	have been paid by the transferor member and previous holders of the same membership, 
31.26 	or of separate memberships that had entitled occupancy to the unit of the member 
31.27 	involved. These contributions include contributions to a corporate reserve account the 
31.28 	use of which is restricted to real property improvements or acquisitions, contributions to 
31.29 	the corporation which are used for real property improvements or acquisitions, and the 
31.30 	amount of principal amortized by the corporation on its indebtedness due to the financing 
31.31 	of real property acquisition or improvement or the averaging of principal paid by the 
31.32 	corporation over the term of its real property-related indebtedness.
31.33 	(b) The articles of incorporation require that the board of directors limit the purchase 
31.34 	price of stock or membership interests for new member-occupants or resident shareholders 
31.35 	to an amount which does not exceed the transfer value for the membership or stock as 
31.36 	defined in clause (a).
32.1 	(c) The articles of incorporation require that the total distribution out of capital to a 
32.2 	member shall not exceed that transfer value.
32.3 	(d) The articles of incorporation require that upon liquidation of the corporation any 
32.4 	assets remaining after retirement of corporate debts and distribution to members will 
32.5 	be conveyed to a charitable organization described in section 501(c)(3) of the Internal 
32.6 	Revenue Code ~~of 1986, as amended through December 31, 1992,~~ or a public agency.
32.7 	A "limited equity cooperative apartment" is a dwelling unit owned by a limited 
32.8 	equity cooperative.
32.9 	"Occupancy entitling cooperative share or membership" is the ownership interest 
32.10 	in a cooperative organization which entitles the holder to an exclusive right to occupy a 
32.11 	dwelling unit owned or leased by the cooperative.
32.12 	For purposes of taxation, the assessor shall value a unit owned by a limited equity 
32.13 	cooperative at the lesser of its market value or the value determined by capitalizing the net 
32.14 	operating income of a comparable apartment operated on a rental basis at the capitalization 
32.15 	rate used in valuing comparable buildings that are not limited equity cooperatives. If a 
32.16 	cooperative fails to operate in accordance with the provisions of clauses (a) to (d), the 
32.17 	property shall be subject to additional property taxes in the amount of the difference 
32.18 	between the taxes determined in accordance with this subdivision for the last ten years that 
32.19 	the property had been assessed pursuant to this subdivision and the amount that would 
32.20 	have been paid if the provisions of this subdivision had not applied to it. The additional 
32.21 	taxes, plus interest at the rate specified in section 549.09, shall be extended against the 
32.22 	property on the tax list for the current year.

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

32.24 	Sec. 15. Minnesota Statutes 2007 Supplement, section 273.1231, subdivision 7, 
32.25 	is amended to read:
32.26 		Subd. 7. Reassessed market value.  "Reassessed market value" means the taxable 
32.27 	market value of the property established for the January 2 assessment in the year that the 
32.28 	disaster or destruction occurs, as adjusted by the county assessor or the commissioner of 
32.29 	revenue to reflect the loss in market value caused by the damage. ~~As soon as practical, the~~ 
32.30 	~~assessor or commissioner shall report the reassessed value to the county auditor.~~

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

32.32 	Sec. 16. Minnesota Statutes 2007 Supplement, section 273.1231, is amended by adding 
32.33 	a subdivision to read:
33.1 		Subd. 8.Utility property. "Utility property" means property appraised and 
33.2 	classified for tax purposes by the commissioner of revenue under sections 273.33 to 
33.3 	273.3711.

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

33.5 	Sec. 17. Minnesota Statutes 2007 Supplement, section 273.1232, subdivision 1, 
33.6 	is amended to read:
33.7 		Subdivision 1. Reassessments required.  For the purposes of sections 273.1231 
33.8 	to 273.1235, the county assessor must reassess all damaged property in a disaster or 
33.9 	emergency area, ~~and the county assessor or~~except that the commissioner of revenue 
33.10 	~~as appropriate~~ shall reassess all property for which an application is submitted to the 
33.11 	commissioner under section 273.1233 or 273.1235. As soon as practical, the assessor or 
33.12 	commissioner of revenue must report the reassessed value to the county auditor. 

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

33.14 	Sec. 18. Minnesota Statutes 2007 Supplement, section 273.1233, subdivision 1, 
33.15 	is amended to read:
33.16 		Subdivision 1. Abatement authorization.  (a) Notwithstanding section 375.192, 
33.17 	a county board may grant an abatement of net tax for homestead and nonhomestead 
33.18 	property under the provisions of this paragraph for taxes payable in the year in which 
33.19 	the destruction occurs if: 
33.20 	(1) the owner submits a written application to the county assessor as soon as 
33.21 	practical after the damage has occurred; 
33.22 	(2) the owner submits a written application to the county board as soon as practical 
33.23 	after the damage has occurred; and 
33.24 	(3) the county assessor determines that 50 percent or more of a homestead dwelling 
33.25 	or other building has been (i) unintentionally or accidentally destroyed, or (ii) destroyed 
33.26 	by arson or vandalism by someone other than the owner. 
33.27 	Abatements granted under this paragraph are not subject to approval by the 
33.28 	commissioner of revenue. 
33.29 	(b) Notwithstanding sections 270C.86 and 375.192, the commissioner of revenue 
33.30 	may grant an abatement of net tax for utility property ~~that the commissioner is required by~~ 
33.31 	~~law to appraise~~ for taxes payable in the year in which the destruction occurs if: 
33.32 	(1) the owner submits a written application to the commissioner as soon as practical 
33.33 	after the damage has occurred; 
34.1 	(2) the owner forwards a copy of the written application to the county board as soon 
34.2 	as practical after the damage has occurred; and 
34.3 	(3) the commissioner determines that 50 percent or more of the property has been 
34.4 	(i) unintentionally or accidentally destroyed, or (ii) destroyed by arson or vandalism by 
34.5 	someone other than the owner. 
34.6 	Abatements granted under this paragraph are not subject to approval by the county 
34.7 	board of the county where the property is located. 

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

34.9 	Sec. 19. Minnesota Statutes 2007 Supplement, section 273.1233, subdivision 3, 
34.10 	is amended to read:
34.11 		Subd. 3. Reimbursement, levy, and appropriation.  (a) If the destruction occurs as 
34.12 	a result of a disaster or emergency and the property is located in a disaster or emergency 
34.13 	area, the county auditor shall certify the abatements granted under this section to the 
34.14 	commissioner of revenue for reimbursement to each taxing jurisdiction in which the 
34.15 	damaged property is located. The commissioner shall make the payments to the taxing 
34.16 	jurisdictions containing the property, other than school districts and the state, at the time 
34.17 	distributions are made under section 473H.10, subdivision 3. Reimbursements to school 
34.18 	districts shall be made as provided in section 273.1392. No reimbursement is to be paid 
34.19 	to the state treasury. 
34.20 	(b) Local taxing authorities may levy in the following year the amount of 
34.21 	unreimbursed tax dollars lost as a result of the reductions granted pursuant to this 
34.22 	~~subdivision~~section and sections 273.1234 and 273.1235 outside of any statutory 
34.23 	restriction as to levy amount or tax rate. 
34.24 	(c) There is annually appropriated from the general fund to the commissioner of 
34.25 	revenue an amount necessary to make the payments required by this section. 

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

34.27 	Sec. 20. Minnesota Statutes 2007 Supplement, section 273.1234, is amended to read:
34.28 	273.1234 TAX RELIEF FOR DESTROYED PROPERTY; HOMESTEAD 
34.29 	AND DISASTER CREDITS. 
34.30 		Subdivision 1. Credit provided.  The county auditor shall compute a credit for taxes 
34.31 	payable in the year following the year in which the damage or destruction occurred for 
34.32 	each reassessed homestead property within the county that is located within a disaster 
34.33 	or emergency area. The credit is equal to the difference in the net tax on the property 
35.1 	computed using the market value of the property established for the January 2 assessment 
35.2 	in the year in which the damage occurred and as computed using the reassessed value. 
35.3 		Subd. 2. Credit reimbursements.  The county auditor shall certify the credits 
35.4 	granted under this section to the commissioner of revenue for reimbursement to each 
35.5 	taxing jurisdiction in which the damaged property is located. The commissioner shall 
35.6 	make the payments to the taxing jurisdictions containing the property, other than 
35.7 	school districts and the state, at the time distributions are made under section 473H.10, 
35.8 	subdivision 3. Reimbursements to school districts shall be made as provided in section 
35.9 	273.1392. ~~No reimbursement is to be paid to the state treasury.~~
35.10 		Subd. 3. Appropriation.  There is annually appropriated from the general fund 
35.11 	to the commissioner of revenue an amount necessary to make the payments required 
35.12 	by this section. 

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

35.14 	Sec. 21. Minnesota Statutes 2007 Supplement, section 273.1235, subdivision 1, 
35.15 	is amended to read:
35.16 		Subdivision 1. Credit provided.  The county board may grant a credit for taxes 
35.17 	payable in the year following the year in which the damage or destruction occurred 
35.18 	for: (1) homestead ~~properties~~ property that meets all the requirements under section 
35.19 	273.1233, subdivision 1, paragraph (a), but that ~~do~~ does not qualify for a credit under 
35.20 	section 273.1234, except that an application need only be submitted by the end of the 
35.21 	year in which the damage occurred; and (2) nonhomestead and utility property ~~meeting~~ 
35.22 	~~the requirements~~ that meets all the requirements under section 273.1233, subdivision 1, 
35.23 	paragraph (b), except that an application need only be submitted by the end of the year 
35.24 	in which the damage occurred. 

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

35.26 	Sec. 22. Minnesota Statutes 2007 Supplement, section 273.1235, subdivision 3, 
35.27 	is amended to read:
35.28 		Subd. 3. Credit reimbursements.  The county auditor shall certify the credits 
35.29 	granted under this section for property within a disaster or emergency area to the 
35.30 	commissioner of revenue for reimbursement to each taxing jurisdiction in which the 
35.31 	damaged property is located. The commissioner shall make the payments to the taxing 
35.32 	jurisdictions containing the property, other than school districts and the state, at the time 
35.33 	distributions are made under section 473H.10, subdivision 3. Reimbursements to school 
36.1 	districts shall be made as provided in section 273.1392. ~~No reimbursement is to be paid~~ 
36.2 	~~to the state treasury.~~ No reimbursement is to be made for credits to property not located 
36.3 	in a disaster or emergency area. 

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

36.5 	Sec. 23. Minnesota Statutes 2006, section 273.124, subdivision 6, is amended to read:
36.6 		Subd. 6.Leasehold cooperatives. When one or more dwellings or one or more 
36.7 	buildings which each contain several dwelling units is owned by a nonprofit corporation 
36.8 	subject to the provisions of chapter 317A and qualifying under section 501(c)(3) or 
36.9 	501(c)(4) of the Internal Revenue Code ~~of 1986, as amended through December 31,~~ 
36.10 	~~1990~~, or a limited partnership which corporation or partnership operates the property in 
36.11 	conjunction with a cooperative association, and has received public financing, homestead 
36.12 	treatment may be claimed by the cooperative association on behalf of the members of 
36.13 	the cooperative for each dwelling unit occupied by a member of the cooperative. The 
36.14 	cooperative association must provide the assessor with the Social Security numbers of 
36.15 	those members. To qualify for the treatment provided by this subdivision, the following 
36.16 	conditions must be met:
36.17 	(a) the cooperative association must be organized under chapter 308A or 308B and 
36.18 	all voting members of the board of directors must be resident tenants of the cooperative 
36.19 	and must be elected by the resident tenants of the cooperative;
36.20 	(b) the cooperative association must have a lease for occupancy of the property for a 
36.21 	term of at least 20 years, which permits the cooperative association, while not in default on 
36.22 	the lease, to participate materially in the management of the property, including material 
36.23 	participation in establishing budgets, setting rent levels, and hiring and supervising a 
36.24 	management agent;
36.25 	(c) to the extent permitted under state or federal law, the cooperative association 
36.26 	must have a right under a written agreement with the owner to purchase the property if the 
36.27 	owner proposes to sell it; if the cooperative association does not purchase the property it is 
36.28 	offered for sale, the owner may not subsequently sell the property to another purchaser at 
36.29 	a price lower than the price at which it was offered for sale to the cooperative association 
36.30 	unless the cooperative association approves the sale;
36.31 	(d) a minimum of 40 percent of the cooperative association's members must have 
36.32 	incomes at or less than 60 percent of area median gross income as determined by the 
36.33 	United States Secretary of Housing and Urban Development under section 142(d)(2)(B) 
36.34 	of the Internal Revenue Code ~~of 1986, as amended through December 31, 1991~~. For 
37.1 	purposes of this clause, "member income" means the income of a member existing at the 
37.2 	time the member acquires cooperative membership;
37.3 	(e) if a limited partnership owns the property, it must include as the managing 
37.4 	general partner a nonprofit organization operating under the provisions of chapter 317A 
37.5 	and qualifying under section 501(c)(3) or 501(c)(4) of the Internal Revenue Code ~~of 1986,~~ 
37.6 	~~as amended through December 31, 1990,~~ and the limited partnership agreement must 
37.7 	provide that the managing general partner have sufficient powers so that it materially 
37.8 	participates in the management and control of the limited partnership;
37.9 	(f) prior to becoming a member of a leasehold cooperative described in this 
37.10 	subdivision, a person must have received notice that (1) describes leasehold cooperative 
37.11 	property in plain language, including but not limited to the effects of classification 
37.12 	under this subdivision on rents, property taxes and tax credits or refunds, and operating 
37.13 	expenses, and (2) states that copies of the articles of incorporation and bylaws of the 
37.14 	cooperative association, the lease between the owner and the cooperative association, a 
37.15 	sample sublease between the cooperative association and a tenant, and, if the owner is a 
37.16 	partnership, a copy of the limited partnership agreement, can be obtained upon written 
37.17 	request at no charge from the owner, and the owner must send or deliver the materials 
37.18 	within seven days after receiving any request;
37.19 	(g) if a dwelling unit of a building was occupied on the 60th day prior to the date on 
37.20 	which the unit became leasehold cooperative property described in this subdivision, the 
37.21 	notice described in paragraph (f) must have been sent by first class mail to the occupant of 
37.22 	the unit at least 60 days prior to the date on which the unit became leasehold cooperative 
37.23 	property. For purposes of the notice under this paragraph, the copies of the documents 
37.24 	referred to in paragraph (f) may be in proposed version, provided that any subsequent 
37.25 	material alteration of those documents made after the occupant has requested a copy 
37.26 	shall be disclosed to any occupant who has requested a copy of the document. Copies of 
37.27 	the articles of incorporation and certificate of limited partnership shall be filed with the 
37.28 	secretary of state after the expiration of the 60-day period unless the change to leasehold 
37.29 	cooperative status does not proceed;
37.30 	(h) the county attorney of the county in which the property is located must certify to 
37.31 	the assessor that the property meets the requirements of this subdivision;
37.32 	(i) the public financing received must be from at least one of the following sources:
37.33 	(1) tax increment financing proceeds used for the acquisition or rehabilitation of the 
37.34 	building or interest rate write-downs relating to the acquisition of the building;
38.1 	(2) government issued bonds exempt from taxes under section 103 of the Internal 
38.2 	Revenue Code ~~of 1986, as amended through December 31, 1991~~, the proceeds of which 
38.3 	are used for the acquisition or rehabilitation of the building;
38.4 	(3) programs under section 221(d)(3), 202, or 236, of Title II of the National 
38.5 	Housing Act;
38.6 	(4) rental housing program funds under Section 8 of the United States Housing Act 
38.7 	of 1937, as amended through December 31, 2007, or the market rate family graduated 
38.8 	payment mortgage program funds administered by the Minnesota Housing Finance 
38.9 	Agency that are used for the acquisition or rehabilitation of the building;
38.10 	(5) low-income housing credit under section 42 of the Internal Revenue Code ~~of~~ 
38.11 	~~1986, as amended through December 31, 1991~~;
38.12 	(6) public financing provided by a local government used for the acquisition or 
38.13 	rehabilitation of the building, including grants or loans from (i) federal community 
38.14 	development block grants; (ii) HOME block grants; or (iii) residential rental bonds issued 
38.15 	under chapter 474A; or
38.16 	(7) other rental housing program funds provided by the Minnesota Housing Finance 
38.17 	Agency for the acquisition or rehabilitation of the building;
38.18 	(j) at the time of the initial request for homestead classification or of any transfer of 
38.19 	ownership of the property, the governing body of the municipality in which the property is 
38.20 	located must hold a public hearing and make the following findings:
38.21 	(1) that the granting of the homestead treatment of the apartment's units will 
38.22 	facilitate safe, clean, affordable housing for the cooperative members that would otherwise 
38.23 	not be available absent the homestead designation;
38.24 	(2) that the owner has presented information satisfactory to the governing body 
38.25 	showing that the savings garnered from the homestead designation of the units will be 
38.26 	used to reduce tenant's rents or provide a level of furnishing or maintenance not possible 
38.27 	absent the designation; and
38.28 	(3) that the requirements of paragraphs (b), (d), and (i) have been met.
38.29 	Homestead treatment must be afforded to units occupied by members of the 
38.30 	cooperative association and the units must be assessed as provided in subdivision 3, 
38.31 	provided that any unit not so occupied shall be classified and assessed pursuant to the 
38.32 	appropriate class. No more than three acres of land may, for assessment purposes, 
38.33 	be included with each dwelling unit that qualifies for homestead treatment under this 
38.34 	subdivision.
38.35 	When dwelling units no longer qualify under this subdivision, the current owner 
38.36 	must notify the assessor within 60 days. Failure to notify the assessor within 60 days shall 
39.1 	result in the loss of benefits under this subdivision for taxes payable in the year that the 
39.2 	failure is discovered. For these purposes, "benefits under this subdivision" means the 
39.3 	difference in the net tax capacity of the units which no longer qualify as computed under 
39.4 	this subdivision and as computed under the otherwise applicable law, times the local tax 
39.5 	rate applicable to the building for that taxes payable year. Upon discovery of a failure to 
39.6 	notify, the assessor shall inform the auditor of the difference in net tax capacity for the 
39.7 	building or buildings in which units no longer qualify, and the auditor shall calculate the 
39.8 	benefits under this subdivision. Such amount, plus a penalty equal to 100 percent of that 
39.9 	amount, shall then be demanded of the building's owner. The property owner may appeal 
39.10 	the county's determination by serving copies of a petition for review with county officials 
39.11 	as provided in section 278.01 and filing a proof of service as provided in section 278.01
39.12 	with the Minnesota Tax Court within 60 days of the date of the notice from the county. 
39.13 	The appeal shall be governed by the Tax Court procedures provided in chapter 271, for 
39.14 	cases relating to the tax laws as defined in section 271.01, subdivision 5; disregarding 
39.15 	sections 273.125, subdivision 5, and 278.03, but including section 278.05, subdivision 2. 
39.16 	If the amount of the benefits under this subdivision and penalty are not paid within 60 
39.17 	days, and if no appeal has been filed, the county auditor shall certify the amount of the 
39.18 	benefit and penalty to the succeeding year's tax list to be collected as part of the property 
39.19 	taxes on the affected buildings.

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

39.21 	Sec. 24. Minnesota Statutes 2006, section 273.124, subdivision 13, is amended to read:
39.22 		Subd. 13.Homestead application. (a) A person who meets the homestead 
39.23 	requirements under subdivision 1 must file a homestead application with the county 
39.24 	assessor to initially obtain homestead classification.
39.25 	(b) On or before January 2, 1993, each county assessor shall mail a homestead 
39.26 	application to the owner of each parcel of property within the county which was 
39.27 	classified as homestead for the 1992 assessment year. The format and contents of a 
39.28 	uniform homestead application shall be prescribed by the commissioner of revenue. The 
39.29 	commissioner shall consult with the chairs of the house and senate tax committees on the 
39.30 	contents of the homestead application form. The application must clearly inform the 
39.31 	taxpayer that this application must be signed by all owners who occupy the property or 
39.32 	by the qualifying relative and returned to the county assessor in order for the property 
39.33 	to continue receiving homestead treatment. The envelope containing the homestead 
39.34 	application shall clearly identify its contents and alert the taxpayer of its necessary 
39.35 	immediate response.
40.1 	(c) Every property owner applying for homestead classification must furnish to the 
40.2 	county assessor the Social Security number of each occupant who is listed as an owner 
40.3 	of the property on the deed of record, the name and address of each owner who does not 
40.4 	occupy the property, and the name and Social Security number of each owner's spouse who 
40.5 	occupies the property. The application must be signed by each owner who occupies the 
40.6 	property and by each owner's spouse who occupies the property, or, in the case of property 
40.7 	that qualifies as a homestead under subdivision 1, paragraph (c), by the qualifying relative.
40.8 	If a property owner occupies a homestead, the property owner's spouse may not 
40.9 	claim another property as a homestead unless the property owner and the property owner's 
40.10 	spouse file with the assessor an affidavit or other proof required by the assessor stating that 
40.11 	the property qualifies as a homestead under subdivision 1, paragraph (e).
40.12 	Owners or spouses occupying residences owned by their spouses and previously 
40.13 	occupied with the other spouse, either of whom fail to include the other spouse's name 
40.14 	and Social Security number on the homestead application or provide the affidavits or 
40.15 	other proof requested, will be deemed to have elected to receive only partial homestead 
40.16 	treatment of their residence. The remainder of the residence will be classified as 
40.17 	nonhomestead residential. When an owner or spouse's name and Social Security number 
40.18 	appear on homestead applications for two separate residences and only one application is 
40.19 	signed, the owner or spouse will be deemed to have elected to homestead the residence for 
40.20 	which the application was signed.
40.21 	The Social Security numbers, state or federal tax returns or tax return information,
40.22 	or affidavits or other proofs of the property owners and spouses submitted under this or 
40.23 	another section to support a claim for a property tax homestead classification are private 
40.24 	data on individuals as defined by section 13.02, subdivision 12, but, notwithstanding 
40.25 	that section, the private data may be disclosed to the commissioner of revenue, or, for 
40.26 	purposes of proceeding under the Revenue Recapture Act to recover personal property 
40.27 	taxes owing, to the county treasurer.
40.28 	(d) If residential real estate is occupied and used for purposes of a homestead by a 
40.29 	relative of the owner and qualifies for a homestead under subdivision 1, paragraph (c), in 
40.30 	order for the property to receive homestead status, a homestead application must be filed 
40.31 	with the assessor. The Social Security number of each relative occupying the property and 
40.32 	the Social Security number of each owner who is related to an occupant of the property 
40.33 	shall be required on the homestead application filed under this subdivision. If a different 
40.34 	relative of the owner subsequently occupies the property, the owner of the property must 
40.35 	notify the assessor within 30 days of the change in occupancy. The Social Security number 
41.1 	of a relative occupying the property is private data on individuals as defined by section 
41.2 	13.02, subdivision 12, but may be disclosed to the commissioner of revenue.
41.3 	(e) The homestead application shall also notify the property owners that the 
41.4 	application filed under this section will not be mailed annually and that if the property 
41.5 	is granted homestead status for the 1993 assessment, or any assessment year thereafter, 
41.6 	that same property shall remain classified as homestead until the property is sold or 
41.7 	transferred to another person, or the owners, the spouse of the owner, or the relatives no 
41.8 	longer use the property as their homestead. Upon the sale or transfer of the homestead 
41.9 	property, a certificate of value must be timely filed with the county auditor as provided 
41.10 	under section 272.115. Failure to notify the assessor within 30 days that the property has 
41.11 	been sold, transferred, or that the owner, the spouse of the owner, or the relative is no 
41.12 	longer occupying the property as a homestead, shall result in the penalty provided under 
41.13 	this subdivision and the property will lose its current homestead status.
41.14 	(f) If the homestead application is not returned within 30 days, the county will send a 
41.15 	second application to the present owners of record. The notice of proposed property taxes 
41.16 	prepared under section 275.065, subdivision 3, shall reflect the property's classification. 
41.17 	Beginning with assessment year 1993 for all properties, if a homestead application has 
41.18 	not been filed with the county by December 15, the assessor shall classify the property 
41.19 	as nonhomestead for the current assessment year for taxes payable in the following year, 
41.20 	provided that the owner may be entitled to receive the homestead classification by proper 
41.21 	application under section 375.192.
41.22 	(g) At the request of the commissioner, each county must give the commissioner a 
41.23 	list that includes the name and Social Security number of each property owner and the 
41.24 	property owner's spouse occupying the property, or relative of a property owner, applying 
41.25 	for homestead classification under this subdivision. The commissioner shall use the 
41.26 	information provided on the lists as appropriate under the law, including for the detection 
41.27 	of improper claims by owners, or relatives of owners, under chapter 290A.
41.28 	(h) If the commissioner finds that a property owner may be claiming a fraudulent 
41.29 	homestead, the commissioner shall notify the appropriate counties. Within 90 days of 
41.30 	the notification, the county assessor shall investigate to determine if the homestead 
41.31 	classification was properly claimed. If the property owner does not qualify, the county 
41.32 	assessor shall notify the county auditor who will determine the amount of homestead 
41.33 	benefits that had been improperly allowed. For the purpose of this section, "homestead 
41.34 	benefits" means the tax reduction resulting from the classification as a homestead under 
41.35 	section 273.13, the taconite homestead credit under section 273.135, the residential 
42.1 	homestead and agricultural homestead credits under section 273.1384, and the 
42.2 	supplemental homestead credit under section 273.1391.
42.3 	The county auditor shall send a notice to the person who owned the affected property 
42.4 	at the time the homestead application related to the improper homestead was filed, 
42.5 	demanding reimbursement of the homestead benefits plus a penalty equal to 100 percent 
42.6 	of the homestead benefits. The person notified may appeal the county's determination 
42.7 	by serving copies of a petition for review with county officials as provided in section 
42.8 	278.01 and filing proof of service as provided in section 278.01 with the Minnesota Tax 
42.9 	Court within 60 days of the date of the notice from the county. Procedurally, the appeal 
42.10 	is governed by the provisions in chapter 271 which apply to the appeal of a property tax 
42.11 	assessment or levy, but without requiring any prepayment of the amount in controversy. If 
42.12 	the amount of homestead benefits and penalty is not paid within 60 days, and if no appeal 
42.13 	has been filed, the county auditor shall certify the amount of taxes and penalty to the county 
42.14 	treasurer. The county treasurer will add interest to the unpaid homestead benefits and 
42.15 	penalty amounts at the rate provided in section 279.03 for real property taxes becoming 
42.16 	delinquent in the calendar year during which the amount remains unpaid. Interest may be 
42.17 	assessed for the period beginning 60 days after demand for payment was made.
42.18 	If the person notified is the current owner of the property, the treasurer may add the 
42.19 	total amount of homestead benefits, penalty, interest, and costs to the ad valorem taxes 
42.20 	otherwise payable on the property by including the amounts on the property tax statements 
42.21 	under section 276.04, subdivision 3. The amounts added under this paragraph to the ad 
42.22 	valorem taxes shall include interest accrued through December 31 of the year preceding 
42.23 	the taxes payable year for which the amounts are first added. These amounts, when added 
42.24 	to the property tax statement, become subject to all the laws for the enforcement of real or 
42.25 	personal property taxes for that year, and for any subsequent year.
42.26 	If the person notified is not the current owner of the property, the treasurer may 
42.27 	collect the amounts due under the Revenue Recapture Act in chapter 270A, or use any of 
42.28 	the powers granted in sections 277.20 and 277.21 without exclusion, to enforce payment 
42.29 	of the homestead benefits, penalty, interest, and costs, as if those amounts were delinquent 
42.30 	tax obligations of the person who owned the property at the time the application related 
42.31 	to the improperly allowed homestead was filed. The treasurer may relieve a prior owner 
42.32 	of personal liability for the homestead benefits, penalty, interest, and costs, and instead 
42.33 	extend those amounts on the tax lists against the property as provided in this paragraph 
42.34 	to the extent that the current owner agrees in writing. On all demands, billings, property 
42.35 	tax statements, and related correspondence, the county must list and state separately the 
43.1 	amounts of homestead benefits, penalty, interest and costs being demanded, billed or 
43.2 	assessed.
43.3 	(i) Any amount of homestead benefits recovered by the county from the property 
43.4 	owner shall be distributed to the county, city or town, and school district where the 
43.5 	property is located in the same proportion that each taxing district's levy was to the total 
43.6 	of the three taxing districts' levy for the current year. Any amount recovered attributable 
43.7 	to taconite homestead credit shall be transmitted to the St. Louis County auditor to be 
43.8 	deposited in the taconite property tax relief account. Any amount recovered that is 
43.9 	attributable to supplemental homestead credit is to be transmitted to the commissioner of 
43.10 	revenue for deposit in the general fund of the state treasury. The total amount of penalty 
43.11 	collected must be deposited in the county general fund.
43.12 	(j) If a property owner has applied for more than one homestead and the county 
43.13 	assessors cannot determine which property should be classified as homestead, the county 
43.14 	assessors will refer the information to the commissioner. The commissioner shall make 
43.15 	the determination and notify the counties within 60 days.
43.16 	(k) In addition to lists of homestead properties, the commissioner may ask the 
43.17 	counties to furnish lists of all properties and the record owners. The Social Security 
43.18 	numbers and federal identification numbers that are maintained by a county or city 
43.19 	assessor for property tax administration purposes, and that may appear on the lists retain 
43.20 	their classification as private or nonpublic data; but may be viewed, accessed, and used by 
43.21 	the county auditor or treasurer of the same county for the limited purpose of assisting the 
43.22 	commissioner in the preparation of microdata samples under section 270C.12.
43.23 	(l) On or before April 30 each year beginning in 2007, each county must provide the 
43.24 	commissioner with the following data for each parcel of homestead property by electronic 
43.25 	means as defined in section 289A.02, subdivision 8:
43.26 	(i) the property identification number assigned to the parcel for purposes of taxes 
43.27 	payable in the current year;
43.28 	(ii) the name and Social Security number of each property owner and property 
43.29 	owner's spouse, as shown on the tax rolls for the current and the prior assessment year;
43.30 	(iii) the classification of the property under section 273.13 for taxes payable in the 
43.31 	current year and in the prior year;
43.32 	(iv) an indication of whether the property was classified as a homestead for taxes 
43.33 	payable in the current year or for taxes payable in the prior year because of occupancy by 
43.34 	a relative of the owner or by a spouse of a relative;
43.35 	(v) the property taxes payable as defined in section 290A.03, subdivision 13, for the 
43.36 	current year and the prior year;
44.1 	(vi) the market value of improvements to the property first assessed for tax purposes 
44.2 	for taxes payable in the current year;
44.3 	(vii) the assessor's estimated market value assigned to the property for taxes payable 
44.4 	in the current year and the prior year;
44.5 	(viii) the taxable market value assigned to the property for taxes payable in the 
44.6 	current year and the prior year;
44.7 	(ix) whether there are delinquent property taxes owing on the homestead;
44.8 	(x) the unique taxing district in which the property is located; and
44.9 	(xi) such other information as the commissioner decides is necessary.
44.10 	The commissioner shall use the information provided on the lists as appropriate 
44.11 	under the law, including for the detection of improper claims by owners, or relatives 
44.12 	of owners, under chapter 290A.

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

44.14 	Sec. 25. Minnesota Statutes 2006, section 273.124, subdivision 21, is amended to read:
44.15 		Subd. 21.Trust property; homestead. Real property held by a trustee under a trust 
44.16 	is eligible for classification as homestead property if:
44.17 	(1) the grantor or surviving spouse of the grantor of the trust occupies and uses the 
44.18 	property as a homestead;
44.19 	(2) a relative or surviving relative of the grantor who meets the requirements of 
44.20 	subdivision 1, paragraph (c), in the case of residential real estate; or subdivision 1, 
44.21 	paragraph (d), in the case of agricultural property, occupies and uses the property as 
44.22 	a homestead;
44.23 	(3) a family farm corporation, joint farm venture, limited liability company, or 
44.24 	partnership operating a family farm in which the grantor or the grantor's surviving spouse 
44.25 	is a shareholder, member, or partner rents the property ~~held by a trustee under a trust~~, and 
44.26 	~~the grantor, the spouse of the grantor, or the son or daughter of the grantor, who is also~~ a 
44.27 	shareholder, member, or partner of the corporation, joint farm venture, limited liability 
44.28 	company, or partnership occupies and uses the property as a homestead, or is actively 
44.29 	farming the property on behalf of the corporation, joint farm venture, limited liability 
44.30 	company, or partnership; or
44.31 	(4) a person who has received homestead classification for property taxes payable in 
44.32 	2000 on the basis of an unqualified legal right under the terms of the trust agreement to 
44.33 	occupy the property as that person's homestead and who continues to use the property as 
44.34 	a homestead or a person who received the homestead classification for taxes payable in 
44.35 	2005 under clause (3) who does not qualify under clause (3) for taxes payable in 2006 
45.1 	or thereafter but who continues to qualify under clause (3) as it existed for taxes payable 
45.2 	in 2005.
45.3 	For purposes of this subdivision, "grantor" is defined as the person creating or 
45.4 	establishing a testamentary, inter Vivos, revocable or irrevocable trust by written 
45.5 	instrument or through the exercise of a power of appointment.

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

45.7 	Sec. 26. Minnesota Statutes 2006, section 273.128, subdivision 1, is amended to read:
45.8 		Subdivision 1.Requirement. Low-income rental property classified as class 4d 
45.9 	under section 273.13, subdivision 25, is entitled to valuation under this section if at least 75 
45.10 	percent of the units in the rental housing property meet any of the following qualifications:
45.11 	(1) the units are subject to a housing assistance payments contract under Section 8 of 
45.12 	the United States Housing Act of 1937, as amended through December 31, 2007;
45.13 	(2) the units are rent-restricted and income-restricted units of a qualified low-income 
45.14 	housing project receiving tax credits under section 42(g) of the Internal Revenue Code 
45.15 	~~of 1986, as amended~~;
45.16 	(3) the units are financed by the Rural Housing Service of the United States 
45.17 	Department of Agriculture and receive payments under the rental assistance program 
45.18 	pursuant to section 521(a) of the Housing Act of 1949, as amended; or
45.19 	(4) the units are subject to rent and income restrictions under the terms of financial 
45.20 	assistance provided to the rental housing property by the federal government or the state 
45.21 	of Minnesota as evidenced by a document recorded against the property.
45.22 	The restrictions must require assisted units to be occupied by residents whose 
45.23 	household income at the time of initial occupancy does not exceed 60 percent of the 
45.24 	greater of area or state median income, adjusted for family size, as determined by the 
45.25 	United States Department of Housing and Urban Development. The restriction must also 
45.26 	require the rents for assisted units to not exceed 30 percent of 60 percent of the greater of 
45.27 	area or state median income, adjusted for family size, as determined by the United States 
45.28 	Department of Housing and Urban Development.

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

45.30 	Sec. 27. Minnesota Statutes 2006, section 273.13, subdivision 22, is amended to read:
45.31 		Subd. 22.Class 1. (a) Except as provided in subdivision 23 and in paragraphs (b) 
45.32 	and (c), real estate which is residential and used for homestead purposes is class 1a. In the 
45.33 	case of a duplex or triplex in which one of the units is used for homestead purposes, the 
46.1 	entire property is deemed to be used for homestead purposes. The market value of class 1a 
46.2 	property must be determined based upon the value of the house, garage, and land.
46.3 	The first $500,000 of market value of class 1a property has a net class rate of 
46.4 	one percent of its market value; and the market value of class 1a property that exceeds 
46.5 	$500,000 has a class rate of 1.25 percent of its market value.
46.6 	(b) Class 1b property includes homestead real estate or homestead manufactured 
46.7 	homes used for the purposes of a homestead by
46.8 	(1) any person who is blind as defined in section 256D.35, or by the blind person 
46.9 	and the blind person's spouse; or
46.10 	(2) any person, hereinafter referred to as "veteran," who:
46.11 	(i) served in the active military or naval service of the United States; and
46.12 	(ii) is entitled to compensation under the laws and regulations of the United States 
46.13 	for permanent and total service-connected disability due to the loss, or loss of use, by 
46.14 	reason of amputation, ankylosis, progressive muscular dystrophies, or paralysis, of both 
46.15 	lower extremities, such as to preclude motion without the aid of braces, crutches, canes, or 
46.16 	a wheelchair; and
46.17 	(iii) has acquired a special housing unit with special fixtures or movable facilities 
46.18 	made necessary by the nature of the veteran's disability, or by the veteran and the veteran's 
46.19 	spouse, or by the surviving spouse of the deceased veteran for as long as the surviving 
46.20 	spouse retains the special housing unit as a homestead; or
46.21 	(3) any person who is permanently and totally disabled or by the disabled person 
46.22 	and the disabled person's spouse.
46.23 	Property is classified and assessed under clause (3) only if the government agency or 
46.24 	income-providing source certifies, upon the request of the homestead occupant, that the 
46.25 	homestead occupant satisfies the disability requirements of this paragraph.
46.26 	Property is classified and assessed pursuant to clause (1) only if the commissioner of 
46.27 	revenue certifies to the assessor that the homestead occupant satisfies the requirements of 
46.28 	this paragraph.
46.29 	Permanently and totally disabled for the purpose of this subdivision means a 
46.30 	condition which is permanent in nature and totally incapacitates the person from working 
46.31 	at an occupation which brings the person an income. The first $32,000 market value of 
46.32 	class 1b property has a net class rate of .45 percent of its market value. The remaining 
46.33 	market value of class 1b property has a class rate using the rates for class 1a or class 2a 
46.34 	property, whichever is appropriate, of similar market value.
46.35 	(c) Class 1c property is commercial use real property that abuts a lakeshore line and 
46.36 	is devoted to temporary and seasonal residential occupancy for recreational purposes but 
47.1 	not devoted to commercial purposes for more than 250 days in the year preceding the 
47.2 	year of assessment, and that includes a portion used as a homestead by the owner, which 
47.3 	includes a dwelling occupied as a homestead by a shareholder of a corporation that owns 
47.4 	the resort, a partner in a partnership that owns the resort, or a member of a limited liability 
47.5 	company that owns the resort even if the title to the homestead is held by the corporation, 
47.6 	partnership, or limited liability company. For purposes of this clause, property is devoted 
47.7 	to a commercial purpose on a specific day if any portion of the property, excluding the 
47.8 	portion used exclusively as a homestead, is used for residential occupancy and a fee is 
47.9 	charged for residential occupancy. The portion of the property used as a homestead is class 
47.10 	1a property under paragraph (a). The remainder of the property is classified as follows: 
47.11 	the first $500,000 of market value is tier I, the next $1,700,000 of market value is tier II, 
47.12 	and any remaining market value is tier III. The class rates for class 1c are: tier I, 0.55 
47.13 	percent; tier II, 1.0 percent; and tier III, 1.25 percent. If a class 1c resort property has any 
47.14 	market value in tier III, the entire property must meet the requirements of subdivision 25, 
47.15 	paragraph (d), clause (1), to qualify for class 1c treatment under this paragraph.
47.16 	(d) Class 1d property includes structures that meet all of the following criteria:
47.17 	(1) the structure is located on property that is classified as agricultural property under 
47.18 	section 273.13, subdivision 23;
47.19 	(2) the structure is occupied exclusively by seasonal farm workers during the time 
47.20 	when they work on that farm, and the occupants are not charged rent for the privilege of 
47.21 	occupying the property, provided that use of the structure for storage of farm equipment 
47.22 	and produce does not disqualify the property from classification under this paragraph;
47.23 	(3) the structure meets all applicable health and safety requirements for the 
47.24 	appropriate season; and
47.25 	(4) the structure is not salable as residential property because it does not comply 
47.26 	with local ordinances relating to location in relation to streets or roads.
47.27 	The market value of class 1d property has the same class rates as class 1a property 
47.28 	under paragraph (a).

47.29 	EFFECTIVE DATE. This section is effective for taxes payable in 2009 and 
47.30 	thereafter.

47.31 	Sec. 28. Minnesota Statutes 2006, section 273.13, subdivision 23, is amended to read:
47.32 		Subd. 23.Class 2. (a) Class 2a property is agricultural land including any 
47.33 	improvements that is homesteaded. The market value of the house and garage and 
47.34 	immediately surrounding one acre of land has the same class rates as class 1a property 
47.35 	under subdivision 22. The value of the remaining land including improvements up to 
48.1 	the first tier valuation limit of agricultural homestead property has a net class rate of 
48.2 	0.55 percent of market value. The remaining property over the first tier has a class rate 
48.3 	of one percent of market value. For purposes of this subdivision, the "first tier valuation 
48.4 	limit of agricultural homestead property" and "first tier" means the limit certified under 
48.5 	section 273.11, subdivision 23.
48.6 	(b) Class 2b property is (1) unplatted real estate, rural in character ~~and used~~ 
48.7 	~~exclusively for growing trees for timber, lumber, and wood and wood products; (2) real~~ 
48.8 	~~estate that is not improved with a structure and is used exclusively for growing trees~~ 
48.9 	~~for timber, lumber, and wood and wood products, if the owner has participated or is~~ 
48.10 	~~participating in a cost-sharing program for afforestation, reforestation, or timber stand~~ 
48.11 	~~improvement on that particular property, administered or coordinated by the commissioner~~ 
48.12 	~~of natural resources; (3)~~ that consists of at least ten acres, including land used for growing 
48.13 	trees for timber, lumber, and wood and wood products, but not including land used for 
48.14 	agricultural purposes, provided that the presence of a minor, ancillary, and nonresidential 
48.15 	structure does not disqualify property from classification under this clause, (2) real estate 
48.16 	that is nonhomestead agricultural land; or ~~(4)~~ (3) a landing area or public access area 
48.17 	of a privately owned public use airport. Class 2b property has a net class rate of one 
48.18 	percent of market value.
48.19 	(c) Agricultural land as used in this section means contiguous acreage of ten acres or 
48.20 	more, used during the preceding year for agricultural purposes. "Agricultural purposes" as 
48.21 	used in this section means the raising or cultivation of agricultural products. "Agricultural 
48.22 	purposes" also includes enrollment in the Reinvest in Minnesota program under sections 
48.23 	103F.501 to 103F.535 or the federal Conservation Reserve Program as contained in Public 
48.24 	Law 99-198 if the property was classified as agricultural (i) under this subdivision for 
48.25 	the assessment year 2002 or (ii) in the year prior to its enrollment. Contiguous acreage 
48.26 	on the same parcel, or contiguous acreage on an immediately adjacent parcel under the 
48.27 	same ownership, may also qualify as agricultural land, but only if it is pasture, timber, 
48.28 	waste, unusable wild land, or land included in state or federal farm programs. Agricultural 
48.29 	classification for property shall be determined excluding the house, garage, and 
48.30 	immediately surrounding one acre of land, and shall not be based upon the market value of 
48.31 	any residential structures on the parcel or contiguous parcels under the same ownership. 
48.32 	(d) Real estate, excluding the house, garage, and immediately surrounding one acre 
48.33 	of land, of less than ten acres which is exclusively and intensively used for raising or 
48.34 	cultivating agricultural products, shall be considered as agricultural land.
48.35 	Land shall be classified as agricultural even if all or a portion of the agricultural use 
48.36 	of that property is the leasing to, or use by another person for agricultural purposes.
49.1 	Classification under this subdivision is not determinative for qualifying under 
49.2 	section 273.111. 
49.3 	The property classification under this section supersedes, for property tax purposes 
49.4 	only, any locally administered agricultural policies or land use restrictions that define 
49.5 	minimum or maximum farm acreage.
49.6 	(e) The term "agricultural products" as used in this subdivision includes production 
49.7 	for sale of:
49.8 	(1) livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing 
49.9 	animals, horticultural and nursery stock, fruit of all kinds, vegetables, forage, grains, 
49.10 	bees, and apiary products by the owner;
49.11 	(2) fish bred for sale and consumption if the fish breeding occurs on land zoned 
49.12 	for agricultural use;
49.13 	(3) the commercial boarding of horses if the boarding is done in conjunction with 
49.14 	raising or cultivating agricultural products as defined in clause (1);
49.15 	(4) property which is owned and operated by nonprofit organizations used for 
49.16 	equestrian activities, excluding racing;
49.17 	(5) game birds and waterfowl bred and raised for use on a shooting preserve licensed 
49.18 	under section 97A.115; 
49.19 	(6) insects primarily bred to be used as food for animals;
49.20 	(7) trees, grown for sale as a crop, and not sold for timber, lumber, wood, or wood 
49.21 	products; and
49.22 	(8) maple syrup taken from trees grown by a person licensed by the Minnesota 
49.23 	Department of Agriculture under chapter 28A as a food processor.
49.24 	(f) If a parcel used for agricultural purposes is also used for commercial or industrial 
49.25 	purposes, including but not limited to:
49.26 	(1) wholesale and retail sales;
49.27 	(2) processing of raw agricultural products or other goods;
49.28 	(3) warehousing or storage of processed goods; and
49.29 	(4) office facilities for the support of the activities enumerated in clauses (1), (2), 
49.30 	and (3),
49.31 	the assessor shall classify the part of the parcel used for agricultural purposes as class 
49.32 	1b, 2a, or 2b, whichever is appropriate, and the remainder in the class appropriate to its 
49.33 	use. The grading, sorting, and packaging of raw agricultural products for first sale is 
49.34 	considered an agricultural purpose. A greenhouse or other building where horticultural 
49.35 	or nursery products are grown that is also used for the conduct of retail sales must be 
49.36 	classified as agricultural if it is primarily used for the growing of horticultural or nursery 
50.1 	products from seed, cuttings, or roots and occasionally as a showroom for the retail sale of 
50.2 	those products. Use of a greenhouse or building only for the display of already grown 
50.3 	horticultural or nursery products does not qualify as an agricultural purpose.
50.4 	The assessor shall determine and list separately on the records the market value of 
50.5 	the homestead dwelling and the one acre of land on which that dwelling is located. If any 
50.6 	farm buildings or structures are located on this homesteaded acre of land, their market 
50.7 	value shall not be included in this separate determination.
50.8 	(g) To qualify for classification under paragraph (b), clause ~~(4)~~ (3), a privately 
50.9 	owned public use airport must be licensed as a public airport under section 360.018. For 
50.10 	purposes of paragraph (b), clause ~~(4)~~ (3), "landing area" means that part of a privately 
50.11 	owned public use airport properly cleared, regularly maintained, and made available to the 
50.12 	public for use by aircraft and includes runways, taxiways, aprons, and sites upon which 
50.13 	are situated landing or navigational aids. A landing area also includes land underlying 
50.14 	both the primary surface and the approach surfaces that comply with all of the following: 
50.15 	(i) the land is properly cleared and regularly maintained for the primary purposes of 
50.16 	the landing, taking off, and taxiing of aircraft; but that portion of the land that contains 
50.17 	facilities for servicing, repair, or maintenance of aircraft is not included as a landing area;
50.18 	(ii) the land is part of the airport property; and
50.19 	(iii) the land is not used for commercial or residential purposes.
50.20 	The land contained in a landing area under paragraph (b), clause ~~(4)~~ (3), must be described 
50.21 	and certified by the commissioner of transportation. The certification is effective until 
50.22 	it is modified, or until the airport or landing area no longer meets the requirements of 
50.23 	paragraph (b), clause ~~(4)~~ (3). For purposes of paragraph (b), clause ~~(4)~~ (3), "public access 
50.24 	area" means property used as an aircraft parking ramp, apron, or storage hangar, or an 
50.25 	arrival and departure building in connection with the airport.

50.26 	EFFECTIVE DATE. This section is effective for taxes payable in 2009 and 
50.27 	thereafter.

50.28 	Sec. 29. Minnesota Statutes 2006, section 273.13, subdivision 25, is amended to read:
50.29 		Subd. 25.Class 4. (a) Class 4a is residential real estate containing four or more 
50.30 	units and used or held for use by the owner or by the tenants or lessees of the owner 
50.31 	as a residence for rental periods of 30 days or more, excluding property qualifying for 
50.32 	class 4d. Class 4a also includes hospitals licensed under sections 144.50 to 144.56, other 
50.33 	than hospitals exempt under section 272.02, and contiguous property used for hospital 
51.1 	purposes, without regard to whether the property has been platted or subdivided. The 
51.2 	market value of class 4a property has a class rate of 1.25 percent.
51.3 	(b) Class 4b includes:
51.4 	(1) residential real estate containing less than four units that does not qualify as class 
51.5 	4bb, other than seasonal residential recreational property;
51.6 	(2) manufactured homes not classified under any other provision;
51.7 	(3) a dwelling, garage, and surrounding one acre of property on a nonhomestead 
51.8 	farm classified under subdivision 23, paragraph (b) containing two or three units; and
51.9 	(4) unimproved property that is classified residential as determined under subdivision 
51.10 	33.
51.11 	The market value of class 4b property has a class rate of 1.25 percent.
51.12 	(c) Class 4bb includes:
51.13 	(1) nonhomestead residential real estate containing one unit, other than seasonal 
51.14 	residential recreational property; and
51.15 	(2) a single family dwelling, garage, and surrounding one acre of property on a 
51.16 	nonhomestead farm classified under subdivision 23, paragraph (b).
51.17 	Class 4bb property has the same class rates as class 1a property under subdivision 22.
51.18 	Property that has been classified as seasonal residential recreational property at 
51.19 	any time during which it has been owned by the current owner or spouse of the current 
51.20 	owner does not qualify for class 4bb.
51.21 	(d) Class 4c property includes:
51.22 	(1) except as provided in subdivision 22, paragraph (c), real property devoted to 
51.23 	temporary and seasonal residential occupancy for recreation purposes, including real 
51.24 	property devoted to temporary and seasonal residential occupancy for recreation purposes 
51.25 	and not devoted to commercial purposes for more than 250 days in the year preceding 
51.26 	the year of assessment. For purposes of this clause, property is devoted to a commercial 
51.27 	purpose on a specific day if any portion of the property is used for residential occupancy, 
51.28 	and a fee is charged for residential occupancy. In order for a property to be classified as 
51.29 	class 4c, seasonal residential recreational for commercial purposes, at least 40 percent of 
51.30 	the annual gross lodging receipts related to the property must be from business conducted 
51.31 	during 90 consecutive days and either (i) at least 60 percent of all paid bookings by lodging 
51.32 	guests during the year must be for periods of at least two consecutive nights; or (ii) at least 
51.33 	20 percent of the annual gross receipts must be from charges for rental of fish houses, 
51.34 	boats and motors, snowmobiles, downhill or cross-country ski equipment, or charges for 
51.35 	marina services, launch services, and guide services, or the sale of bait and fishing tackle. 
51.36 	For purposes of this determination, a paid booking of five or more nights shall be counted 
52.1 	as two bookings. Class 4c also includes commercial use real property used exclusively 
52.2 	for recreational purposes in conjunction with class 4c property devoted to temporary 
52.3 	and seasonal residential occupancy for recreational purposes, up to a total of two acres, 
52.4 	provided the property is not devoted to commercial recreational use for more than 250 
52.5 	days in the year preceding the year of assessment and is located within two miles of the 
52.6 	class 4c property with which it is used. Owners of real property devoted to temporary and 
52.7 	seasonal residential occupancy for recreation purposes and all or a portion of which was 
52.8 	devoted to commercial purposes for not more than 250 days in the year preceding the year 
52.9 	of assessment desiring classification as class 1c or 4c, must submit a declaration to the 
52.10 	assessor designating the cabins or units occupied for 250 days or less in the year preceding 
52.11 	the year of assessment by January 15 of the assessment year. Those cabins or units and a 
52.12 	proportionate share of the land on which they are located will be designated class 1c or 4c 
52.13 	as otherwise provided. The remainder of the cabins or units and a proportionate share of 
52.14 	the land on which they are located will be designated as class 3a. The owner of property 
52.15 	desiring designation as class 1c or 4c property must provide guest registers or other 
52.16 	records demonstrating that the units for which class 1c or 4c designation is sought were 
52.17 	not occupied for more than 250 days in the year preceding the assessment if so requested. 
52.18 	The portion of a property operated as a (1) restaurant, (2) bar, (3) gift shop, and (4) other 
52.19 	nonresidential facility operated on a commercial basis not directly related to temporary and 
52.20 	seasonal residential occupancy for recreation purposes shall not qualify for class 1c or 4c;
52.21 	(2) qualified property used as a golf course if:
52.22 	(i) it is open to the public on a daily fee basis. It may charge membership fees or 
52.23 	dues, but a membership fee may not be required in order to use the property for golfing, 
52.24 	and its green fees for golfing must be comparable to green fees typically charged by 
52.25 	municipal courses; and
52.26 	(ii) it meets the requirements of section 273.112, subdivision 3, paragraph (d).
52.27 	A structure used as a clubhouse, restaurant, or place of refreshment in conjunction 
52.28 	with the golf course is classified as class 3a property;
52.29 	(3) real property up to a maximum of one acre of land owned by a nonprofit 
52.30 	community service oriented organization; provided that the property is not used for a 
52.31 	revenue-producing activity for more than six days in the calendar year preceding the year 
52.32 	of assessment and the property is not used for residential purposes on either a temporary 
52.33 	or permanent basis. For purposes of this clause, a "nonprofit community service oriented 
52.34 	organization" means any corporation, society, association, foundation, or institution 
52.35 	organized and operated exclusively for charitable, religious, fraternal, civic, or educational 
52.36 	purposes, and which is exempt from federal income taxation pursuant to section 501(c)(3), 
53.1 	(10), or (19) of the Internal Revenue Code ~~of 1986, as amended through December 31,~~ 
53.2 	~~1990~~. For purposes of this clause, "revenue-producing activities" shall include but not be 
53.3 	limited to property or that portion of the property that is used as an on-sale intoxicating 
53.4 	liquor or 3.2 percent malt liquor establishment licensed under chapter 340A, a restaurant 
53.5 	open to the public, bowling alley, a retail store, gambling conducted by organizations 
53.6 	licensed under chapter 349, an insurance business, or office or other space leased or 
53.7 	rented to a lessee who conducts a for-profit enterprise on the premises. Any portion of 
53.8 	the property which is used for revenue-producing activities for more than six days in the 
53.9 	calendar year preceding the year of assessment shall be assessed as class 3a. The use of 
53.10 	the property for social events open exclusively to members and their guests for periods of 
53.11 	less than 24 hours, when an admission is not charged nor any revenues are received by the 
53.12 	organization shall not be considered a revenue-producing activity;
53.13 	(4) postsecondary student housing of not more than one acre of land that is owned by 
53.14 	a nonprofit corporation organized under chapter 317A and is used exclusively by a student 
53.15 	cooperative, sorority, or fraternity for on-campus housing or housing located within two 
53.16 	miles of the border of a college campus;
53.17 	(5) manufactured home parks as defined in section 327.14, subdivision 3;
53.18 	(6) real property that is actively and exclusively devoted to indoor fitness, health, 
53.19 	social, recreational, and related uses, is owned and operated by a not-for-profit corporation, 
53.20 	and is located within the metropolitan area as defined in section 473.121, subdivision 2;
53.21 	(7) a leased or privately owned noncommercial aircraft storage hangar not exempt 
53.22 	under section 272.01, subdivision 2, and the land on which it is located, provided that:
53.23 	(i) the land is on an airport owned or operated by a city, town, county, Metropolitan 
53.24 	Airports Commission, or group thereof; and
53.25 	(ii) the land lease, or any ordinance or signed agreement restricting the use of the 
53.26 	leased premise, prohibits commercial activity performed at the hangar.
53.27 	If a hangar classified under this clause is sold after June 30, 2000, a bill of sale must 
53.28 	be filed by the new owner with the assessor of the county where the property is located 
53.29 	within 60 days of the sale;
53.30 	(8) a privately owned noncommercial aircraft storage hangar not exempt under 
53.31 	section 272.01, subdivision 2, and the land on which it is located, provided that:
53.32 	(i) the land abuts a public airport; and
53.33 	(ii) the owner of the aircraft storage hangar provides the assessor with a signed 
53.34 	agreement restricting the use of the premises, prohibiting commercial use or activity 
53.35 	performed at the hangar; and
54.1 	(9) residential real estate, a portion of which is used by the owner for homestead 
54.2 	purposes, and that is also a place of lodging, if all of the following criteria are met:
54.3 	(i) rooms are provided for rent to transient guests that generally stay for periods 
54.4 	of 14 or fewer days;
54.5 	(ii) meals are provided to persons who rent rooms, the cost of which is incorporated 
54.6 	in the basic room rate;
54.7 	(iii) meals are not provided to the general public except for special events on fewer 
54.8 	than seven days in the calendar year preceding the year of the assessment; and
54.9 	(iv) the owner is the operator of the property.
54.10 	The market value subject to the 4c classification under this clause is limited to five rental 
54.11 	units. Any rental units on the property in excess of five, must be valued and assessed as 
54.12 	class 3a. The portion of the property used for purposes of a homestead by the owner must 
54.13 	be classified as class 1a property under subdivision 22.
54.14 	Class 4c property has a class rate of 1.5 percent of market value, except that (i) each 
54.15 	parcel of seasonal residential recreational property not used for commercial purposes has 
54.16 	the same class rates as class 4bb property, (ii) manufactured home parks assessed under 
54.17 	clause (5) have the same class rate as class 4b property, (iii) commercial-use seasonal 
54.18 	residential recreational property has a class rate of one percent for the first $500,000 of 
54.19 	market value, and 1.25 percent for the remaining market value, (iv) the market value of 
54.20 	property described in clause (4) has a class rate of one percent, (v) the market value of 
54.21 	property described in clauses (2) and (6) has a class rate of 1.25 percent, and (vi) that 
54.22 	portion of the market value of property in clause (9) qualifying for class 4c property 
54.23 	has a class rate of 1.25 percent.
54.24 	(e) Class 4d property is qualifying low-income rental housing certified to the assessor 
54.25 	by the Housing Finance Agency under section 273.128, subdivision 3. If only a portion 
54.26 	of the units in the building qualify as low-income rental housing units as certified under 
54.27 	section 273.128, subdivision 3, only the proportion of qualifying units to the total number 
54.28 	of units in the building qualify for class 4d. The remaining portion of the building shall be 
54.29 	classified by the assessor based upon its use. Class 4d also includes the same proportion of 
54.30 	land as the qualifying low-income rental housing units are to the total units in the building. 
54.31 	For all properties qualifying as class 4d, the market value determined by the assessor must 
54.32 	be based on the normal approach to value using normal unrestricted rents.
54.33 	Class 4d property has a class rate of 0.75 percent.

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

55.1 	Sec. 30. Minnesota Statutes 2006, section 273.13, subdivision 33, is amended to read:
55.2 		Subd. 33.Classification of unimproved property. (a) All real property that is not 
55.3 	improved with a structure must be classified according to its current use.
55.4 	(b) Except as provided in subdivision 23, paragraph (b), clause (1), real property that 
55.5 	is not improved with a structure and for which there is no identifiable current use must be 
55.6 	classified according to its highest and best use permitted under the local zoning ordinance. 
55.7 	If the ordinance permits more than one use, the land must be classified according to the 
55.8 	highest and best use permitted under the ordinance. If no such ordinance exists, the 
55.9 	assessor shall consider the most likely potential use of the unimproved land based upon 
55.10 	the use made of surrounding land or land in proximity to the unimproved land.

55.11 	EFFECTIVE DATE. This section is effective for taxes payable in 2009 and 
55.12 	thereafter.

55.13 	Sec. 31. Minnesota Statutes 2006, section 274.01, subdivision 3, is amended to read:
55.14 		Subd. 3.Local board duties transferred to county. The town board of any town 
55.15 	or the governing body of any home rule charter or statutory city may transfer its powers 
55.16 	and duties under subdivision 1 to the county board, and no longer perform the function 
55.17 	of a local board. Before the town board or the governing body of a city transfers the 
55.18 	powers and duties to the county board, the town board or city's governing body shall give 
55.19 	public notice of the meeting at which the proposal for transfer is to be considered. The 
55.20 	public notice shall follow the procedure contained in section 13D.04, subdivision 2. A 
55.21 	transfer of duties as permitted under this subdivision must be communicated to the county 
55.22 	assessor, in writing, before December 1 of any year to be effective for the following 
55.23 	year's assessment. This transfer of duties to the county may either be permanent or for a 
55.24 	specified number of years, provided that the transfer cannot be for less than three years. 
55.25 	Its length must be stated in writing. A town or city may renew its option to transfer. ~~The~~ 
55.26 	~~option to transfer duties under this subdivision is only available to a town or city whose~~ 
55.27 	~~assessment is done by the county.~~

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

55.29 	Sec. 32. Minnesota Statutes 2006, section 274.014, subdivision 3, is amended to read:
55.30 		Subd. 3.Proof of compliance; transfer of duties. (a) Any city or town that 
55.31 	conducts local boards of appeal and equalization meetings must provide proof to the 
55.32 	county assessor by December 1, 2006, and each year thereafter, that it is in compliance 
55.33 	with the requirements of subdivision 2. Beginning in 2006, this notice must also verify 
56.1 	that there was a quorum of voting members at each meeting of the board of appeal 
56.2 	and equalization in the current year. A city or town that does not comply with these 
56.3 	requirements is deemed to have transferred its board of appeal and equalization powers 
56.4 	to the county beginning with the following year's assessment and continuing unless the 
56.5 	powers are reinstated under paragraph (c).
56.6 	(b) The county shall notify the taxpayers when the board of appeal and equalization 
56.7 	for a city or town has been transferred to the county under this subdivision and, prior to 
56.8 	the meeting time of the county board of equalization, the county shall make available to 
56.9 	those taxpayers a procedure for a review of the assessments, including, but not limited to, 
56.10 	open book meetings. This alternate review process shall take place in April and May.
56.11 	(c) A local board whose powers are transferred to the county under this subdivision 
56.12 	may be reinstated by resolution of the governing body of the city or town and upon proof 
56.13 	of compliance with the requirements of subdivision 2. The resolution and proofs must be 
56.14 	provided to the county assessor by December 1 in order to be effective for the following 
56.15 	year's assessment.
56.16 	(d) A local board whose powers are transferred to the county under this subdivision 
56.17 	may continue to employ a local assessor and is not deemed to have transferred its powers 
56.18 	to make assessments.

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

56.20 	Sec. 33. Minnesota Statutes 2006, section 276.04, subdivision 2, is amended to read:
56.21 		Subd. 2.Contents of tax statements. (a) The treasurer shall provide for the 
56.22 	printing of the tax statements. The commissioner of revenue shall prescribe the form 
56.23 	of the property tax statement and its contents. The statement must contain a tabulated 
56.24 	statement of the dollar amount due to each taxing authority and the amount of the state 
56.25 	tax from the parcel of real property for which a particular tax statement is prepared. The 
56.26 	dollar amounts attributable to the county, the state tax, the voter approved school tax, the 
56.27 	other local school tax, the township or municipality, and the total of the metropolitan 
56.28 	special taxing districts as defined in section 275.065, subdivision 3, paragraph (i), must 
56.29 	be separately stated. The amounts due all other special taxing districts, if any, may be 
56.30 	aggregated except that any levies made by the regional rail authorities in the county of 
56.31 	Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 398A 
56.32 	shall be listed on a separate line directly under the appropriate county's levy. If the county 
56.33 	levy under this paragraph includes an amount for a lake improvement district as defined 
56.34 	under sections 103B.501 to 103B.581, the amount attributable for that purpose must be 
56.35 	separately stated from the remaining county levy amount. In the case of Ramsey County, 
57.1 	if the county levy under this paragraph includes an amount for public library service 
57.2 	under section 134.07, the amount attributable for that purpose may be separated from the 
57.3 	remaining county levy amount. The amount of the tax on homesteads qualifying under the 
57.4 	senior citizens' property tax deferral program under chapter 290B is the total amount of 
57.5 	property tax before subtraction of the deferred property tax amount. The amount of the 
57.6 	tax on contamination value imposed under sections 270.91 to 270.98, if any, must also 
57.7 	be separately stated. The dollar amounts, including the dollar amount of any special 
57.8 	assessments, may be rounded to the nearest even whole dollar. For purposes of this section 
57.9 	whole odd-numbered dollars may be adjusted to the next higher even-numbered dollar. 
57.10 	The amount of market value excluded under section 273.11, subdivision 16, if any, must 
57.11 	also be listed on the tax statement.
57.12 	(b) The property tax statements for manufactured homes and sectional structures 
57.13 	taxed as personal property shall contain the same information that is required on the 
57.14 	tax statements for real property.
57.15 	(c) Real and personal property tax statements must contain the following information 
57.16 	in the order given in this paragraph. The information must contain the current year tax 
57.17 	information in the right column with the corresponding information for the previous year 
57.18 	in a column on the left:
57.19 	(1) the property's estimated market value under section 273.11, subdivision 1;
57.20 	(2) the property's taxable market value after reductions under section 273.11, 
57.21 	subdivisions 1a and 16;
57.22 	(3) the property's gross tax, calculated by adding the property's total property tax to 
57.23 	the sum of the aids enumerated in clause (4);
57.24 	(4) a total of the following aids:
57.25 	(i) education aids payable under chapters 122A, 123A, 123B, 124D, 125A, 126C, 
57.26 	and 127A;
57.27 	(ii) local government aids for cities, towns, and counties under sections 477A.011 to 
57.28 	477A.04; and
57.29 	(iii) disparity reduction aid under section 273.1398;
57.30 	(5) for homestead residential and agricultural properties, the credits under section 
57.31 	273.1384;
57.32 	(6) any credits received under sections 273.119; ~~273.123~~ 273.1234 or 273.1235; 
57.33 	273.135; 273.1391; 273.1398, subdivision 4; 469.171; and 473H.10, except that the 
57.34 	amount of credit received under section 273.135 must be separately stated and identified 
57.35 	as "taconite tax relief"; and
57.36 	(7) the net tax payable in the manner required in paragraph (a).
58.1 	(d) If the county uses envelopes for mailing property tax statements and if the county 
58.2 	agrees, a taxing district may include a notice with the property tax statement notifying 
58.3 	taxpayers when the taxing district will begin its budget deliberations for the current 
58.4 	year, and encouraging taxpayers to attend the hearings. If the county allows notices to 
58.5 	be included in the envelope containing the property tax statement, and if more than 
58.6 	one taxing district relative to a given property decides to include a notice with the tax 
58.7 	statement, the county treasurer or auditor must coordinate the process and may combine 
58.8 	the information on a single announcement.
58.9 	The commissioner of revenue shall certify to the county auditor the actual or 
58.10 	estimated aids enumerated in paragraph (c), clause (4), that local governments will receive 
58.11 	in the following year. The commissioner must certify this amount by January 1 of each 
58.12 	year.

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

58.14 	Sec. 34. Minnesota Statutes 2006, section 290B.04, subdivision 1, is amended to read:
58.15 		Subdivision 1.Initial application. (a) A taxpayer meeting the program 
58.16 	qualifications under section 290B.03 may apply to the commissioner of revenue for the 
58.17 	deferral of taxes. Applications are due on or before July 1 for deferral of any of the 
58.18 	following year's property taxes. A taxpayer may apply in the year in which the taxpayer 
58.19 	becomes 65 years old, provided that no deferral of property taxes will be made until the 
58.20 	calendar year after the taxpayer becomes 65 years old. The application, which shall be 
58.21 	prescribed by the commissioner of revenue, shall include the following items and any 
58.22 	other information which the commissioner deems necessary: 
58.23 	(1) the name, address, and Social Security number of the owner or owners;
58.24 	(2) a copy of the property tax statement for the current payable year for the 
58.25 	homesteaded property;
58.26 	(3) the initial year of ownership and occupancy as a homestead;
58.27 	(4) the owner's household income for the previous calendar year; and
58.28 	(5) information on any mortgage loans or other amounts secured by mortgages or 
58.29 	other liens against the property, for which purpose the commissioner may require the 
58.30 	applicant to provide a copy of the mortgage note, the mortgage, or a statement of the 
58.31 	balance owing on the mortgage loan provided by the mortgage holder. The commissioner 
58.32 	may require the appropriate documents in connection with obtaining and confirming 
58.33 	information on unpaid amounts secured by other liens.
58.34 	The application must state that program participation is voluntary. The application 
58.35 	must also state that the deferred amount depends directly on the applicant's household 
59.1 	income, and that program participation includes authorization for the annual deferred 
59.2 	amount, the cumulative deferral and interest that appear on each year's notice prepared by 
59.3 	the county under subdivision 6, is public data.
59.4 	The application must state that program participants may claim the property tax 
59.5 	refund based on the full amount of property taxes eligible for the refund, including any 
59.6 	deferred amounts. The application must also state that property tax refunds will be used to 
59.7 	offset any deferral and interest under this program, and that any other amounts subject to 
59.8 	revenue recapture under section 270A.03, subdivision 7, will also be used to offset any 
59.9 	deferral and interest under this program. 
59.10 	(b) As part of the initial application process, the commissioner may require the 
59.11 	applicant to obtain at the applicant's own cost and submit:
59.12 	(1) if the property is registered property under chapter 508 or 508A, a copy of the 
59.13 	original certificate of title in the possession of the county registrar of titles (sometimes 
59.14 	referred to as "condition of register"); or
59.15 	(2) if the property is abstract property, a report prepared by a licensed abstracter 
59.16 	showing the last deed and any unsatisfied mortgages, liens, judgments, and state and 
59.17 	federal tax lien notices which were recorded on or after the date of that last deed with 
59.18 	respect to the property or to the applicant.
59.19 	The certificate or report under clauses (1) and (2) need not include references to 
59.20 	any documents filed or recorded more than 40 years prior to the date of the certification 
59.21 	or report. The certification or report must be as of a date not more than 30 days prior 
59.22 	to submission of the application.
59.23 	The commissioner may also require the county recorder or county registrar of the 
59.24 	county where the property is located to provide copies of recorded documents related to 
59.25 	the applicant or the property, for which the recorder or registrar shall not charge a fee. The 
59.26 	commissioner may use any information available to determine or verify eligibility under 
59.27 	this section. The household income from the application is private data on individuals as 
59.28 	defined in section 13.02, subdivision 12.

59.29 	EFFECTIVE DATE. This section is effective for data collected or maintained by 
59.30 	the commissioner of revenue beginning the day following final enactment.

59.31 	Sec. 35. Minnesota Statutes 2006, section 469.040, subdivision 4, is amended to read:
59.32 		Subd. 4.Facilities funded from multiple sources. In the metropolitan area, as 
59.33 	defined in section 473.121, subdivision 2, the tax treatment provided in subdivision 3 
59.34 	applies to that portion of any multifamily rental housing facility represented by the ratio of 
59.35 	(1) the number of units in the facility that are subject to the requirements of Section 5 of 
60.1 	the United States Housing Act of 1937, as the result of the implementation of a federal 
60.2 	court order or consent decree to (2) the total number of units within the facility. 
60.3 	The housing and redevelopment authority for the city in which the facility is located, 
60.4 	any public entity exercising the powers of such housing and redevelopment authority, or 
60.5 	the county housing and redevelopment authority for the county in which the facility is 
60.6 	located, shall annually certify to the assessor responsible for assessing the facility, at the 
60.7 	time and in the manner required by the assessor, the number of units in the facility that are 
60.8 	subject to the requirements of Section 5 of the United States Housing Act of 1937.
60.9 	Nothing in this subdivision shall prevent that portion of the facility not subject to 
60.10 	this subdivision from meeting the requirements of section ~~273.126~~ 273.128, and for that 
60.11 	purpose the total number of units in the facility must be taken into account. 

60.12 	EFFECTIVE DATE. This section is effective retroactively for taxes payable in 
60.13 	2006 and thereafter.

60.14 	Sec. 36. Minnesota Statutes 2006, section 469.174, subdivision 10b, is amended to 
60.15 	read:
60.16 		Subd. 10b.Qualified disaster area. A "qualified disaster area" is an area that 
60.17 	meets the following requirements:
60.18 	(1) parcels consisting of 70 percent of the area of the district were occupied by 
60.19 	buildings, streets, utilities, paved or gravel parking lots, or other similar structures 
60.20 	immediately before the disaster or emergency;
60.21 	(2) the area of the district was subject to a disaster or emergency, as defined in 
60.22 	section ~~273.123, subdivision 1~~ 273.1231, subdivision 2, within the 18-month period 
60.23 	ending on the day the request for certification of the district is made; and 
60.24 	(3) 50 percent or more of the buildings in the area have suffered substantial damage 
60.25 	as a result of the disaster or emergency.

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

60.27 	Sec. 37. Minnesota Statutes 2006, section 469.177, subdivision 1c, is amended to read:
60.28 		Subd. 1c.Original net tax capacity adjustments; presidential disaster area. (a) 
60.29 	The provisions of this subdivision apply to a district located in a disaster area, as described 
60.30 	in section   ~~273.123, subdivision 1, paragraph (b)~~ 273.1231, subdivision 3, paragraph (a), 
60.31 	clause (1), and are effective for taxes payable in the first calendar year beginning at least 
60.32 	four months after the date of the determination. 
61.1 	(b) For a district certified before the date of the disaster area determination as 
61.2 	provided in section   ~~273.123, subdivision 1, paragraph (b)~~ 273.1231, subdivision 3, 
61.3 	paragraph (a), clause (1), upon the request of the municipality, the county auditor shall 
61.4 	reduce the original net tax capacity of the district by the reduction in the net tax capacity 
61.5 	of properties in the district that is attributable to the physical effects of the disaster, but not 
61.6 	below zero. The assessor shall determine the amount of the reduction in market value that 
61.7 	is attributable to the physical effects of the disaster to be used by the county auditor in 
61.8 	computing the reduction in net tax capacity. 
61.9 	(c) For a district that does not qualify under paragraph (b) and for which the request 
61.10 	for certification is made in the same calendar year as the disaster area determination, 
61.11 	upon the request of the municipality, the assessor shall determine the reduction in market 
61.12 	value of properties in the district that is attributable to the physical effects of the disaster. 
61.13 	The county auditor shall use the reduced market value in certifying the original net tax 
61.14 	capacity of the district.

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

61.16 	Sec. 38. Minnesota Statutes 2006, section 477A.03, subdivision 2a, is amended to read:
61.17 		Subd. 2a.Cities. ~~For aids payable in 2004, the total aids paid under section~~ 
61.18 	~~477A.013, subdivision 9, are limited to $429,000,000. For aids payable in 2005, the~~ 
61.19 	~~total aids paid under section 477A.013, subdivision 9, are limited to $437,052,000.~~ For 
61.20 	aids payable in ~~2006~~ 2009 and thereafter, the total aids paid under section 477A.013, 
61.21 	subdivision 9, is limited to ~~$485,052,000~~ $484,177,200.

61.22 	EFFECTIVE DATE. This section is effective for aid payable in 2009 and thereafter.

61.23 	Sec. 39.  REPEALER.
 61.24 	Minnesota Statutes 2006, section 477A.014, subdivision 5, and Minnesota Statutes 
61.25 	2007 Supplement, section 477A.014, subdivision 4, are repealed.

61.26 	EFFECTIVE DATE. This section is effective for aid payable in 2009 and thereafter.

61.27 	ARTICLE 5
61.28 	JOB OPPORTUNITY BUILDING ZONES

61.29 	Section 1. Minnesota Statutes 2006, section 469.319, is amended to read:
61.30 	469.319 REPAYMENT OF TAX BENEFITS BY BUSINESSES THAT NO 
61.31 	LONGER OPERATE IN A ZONE.
62.1 		Subdivision 1.Repayment obligation. A business must repay the ~~amount of the~~
62.2 	total tax ~~reduction~~benefits listed in section 469.315~~and any refund under section 469.318~~
62.3 	~~in excess of tax liability,~~ received during the two years immediately before it (1) ceased to 
62.4 	~~operate in the zone, if the business:~~
62.5 	~~(1) received tax reductions authorized by section 469.315; and~~
62.6 	~~(2)(i) did not meet the goals specified in an agreement entered into with the applicant~~ 
62.7 	~~that states any obligation the qualified business must fulfill in order to be eligible for tax~~ 
62.8 	~~benefits. The commissioner of employment and economic development may extend for~~ 
62.9 	~~up to one year the period for meeting any goals provided in an agreement. The applicant~~ 
62.10 	~~may extend the period for meeting other goals by documenting in writing the reason~~ 
62.11 	~~for the extension and attaching a copy of the document to its next annual report to the~~ 
62.12 	~~commissioner of employment and economic development; or~~
62.13 	~~(ii) ceased to operate its facility located within the job opportunity building zone~~
62.14 	 perform a substantial level of activities described in the business subsidy agreement, or 
62.15 	(2) otherwise ~~ceases~~ceased to be ~~or is not~~ a qualified business, other than those subject to 
62.16 	the provisions of section 469.3191.
62.17 		Subd. 1a.Repayment obligation of businesses not operating in zone. Persons 
62.18 	that receive benefits without operating a business in a zone are subject to repayment 
62.19 	under this section if the business for which those benefits relate is subject to repayment 
62.20 	under this section. Such persons are deemed to have ceased performing in the zone on 
62.21 	the same day that the qualified business for which the benefits relate becomes subject to 
62.22 	repayment under subdivision 1.
62.23 		Subd. 2.Definitions. (a) For purposes of this section, the following terms have 
62.24 	the meanings given.
62.25 	(b) "Business" means any person ~~who~~that received tax benefits enumerated in 
62.26 	section 469.315. 
62.27 	(c) "Commissioner" means the commissioner of revenue.
62.28 	(d) "Persons that receive benefits without operating a business in a zone" means 
62.29 	persons that claim benefits under section 469.316, subdivision 2 or 4, as well as persons 
62.30 	that own property leased by a qualified business and eligible for benefits under section 
62.31 	272.02, subdivision 64, or 297A.68, subdivision 37, paragraph (b).
62.32 		Subd. 3.Disposition of repayment. The repayment must be paid to the state to 
62.33 	the extent it represents a state tax reduction and to the county to the extent it represents a 
62.34 	property tax reduction. Any amount repaid to the state must be deposited in the general 
62.35 	fund. Any amount repaid to the county for the property tax exemption must be distributed 
62.36 	to the ~~local governments~~ taxing authorities with authority to levy taxes in the zone in the 
63.1 	same manner provided for distribution of payment of delinquent property taxes. Any 
63.2 	repayment of local sales taxes must be repaid to the commissioner for distribution to the 
63.3 	city or county imposing the local sales tax.
63.4 		Subd. 4.Repayment procedures. (a) For the repayment of taxes imposed under 
63.5 	chapter 290 or 297A or local taxes collected pursuant to section 297A.99, a business must 
63.6 	file an amended return with the commissioner of revenue and pay any taxes required 
63.7 	to be repaid within 30 days after ~~ceasing to do business in the zone~~ becoming subject 
63.8 	to repayment under this section. The amount required to be repaid is determined by 
63.9 	calculating the tax for the period or periods for which repayment is required without 
63.10 	regard to the exemptions and credits allowed under section 469.315.
63.11 	(b) For the repayment of taxes imposed under chapter 297B, a business must pay any 
63.12 	taxes required to be repaid to the motor vehicle registrar, as agent for the commissioner 
63.13 	of revenue, within 30 days after ~~ceasing to do business in the zone~~ becoming subject 
63.14 	to repayment under this section.
63.15 	(c) For the repayment of property taxes, the county auditor shall prepare a tax 
63.16 	statement for the business, applying the applicable tax extension rates for each payable 
63.17 	year and provide a copy to the business and to the taxpayer of record. The business must 
63.18 	pay the taxes to the county treasurer within 30 days after receipt of the tax statement. 
63.19 	The business or the taxpayer of record may appeal the valuation and determination of the 
63.20 	property tax to the Tax Court within 30 days after receipt of the tax statement.
63.21 	(d) The provisions of chapters 270C and 289A relating to the commissioner's 
63.22 	authority to audit, assess, and collect the tax and to hear appeals are applicable to the 
63.23 	repayment required under paragraphs (a) and (b). The commissioner may impose civil 
63.24 	penalties as provided in chapter 289A, and the additional tax and penalties are subject to 
63.25 	interest at the rate provided in section 270C.40, from 30 days after ~~ceasing to do business~~ 
63.26 	~~in the job opportunity building zone~~ becoming subject to repayment under this section
63.27 	until the date the tax is paid.
63.28 	(e) If a property tax is not repaid under paragraph (c), the county treasurer shall add 
63.29 	the amount required to be repaid to the property taxes assessed against the property for 
63.30 	payment in the year following the year in which the ~~treasurer discovers that the business~~ 
63.31 	~~ceased to operate in the job opportunity building zone~~ auditor provided the statement 
63.32 	under paragraph (c).
63.33 	(f) For determining the tax required to be repaid, a ~~tax~~ reduction of a state or local 
63.34 	sales or use tax is deemed to have been received on the date that the ~~tax would have~~ 
63.35 	~~been due if the taxpayer had not been entitled to the exemption or on the date a refund~~ 
63.36 	~~was issued for a refundable tax credit.~~ good or service was purchased or first put to a 
64.1 	taxable use. In the case of an income tax or franchise tax, including the credit payable 
64.2 	under section 469.318, a reduction of tax is deemed to have been received for the two 
64.3 	most recent tax years that have ended prior to the date that the business became subject to 
64.4 	repayment under this section. In the case of a property tax, a reduction of tax is deemed to 
64.5 	have been received for the taxes payable in the year that the business became subject to 
64.6 	repayment under this section and for the taxes payable in the prior year.
64.7 	(g) The commissioner may assess the repayment of taxes under paragraph (d) 
64.8 	any time within two years after the business ~~ceases to operate in the job opportunity~~ 
64.9 	~~building zone~~ becomes subject to repayment under subdivision 1, or within any period of 
64.10 	limitations for the assessment of tax under section 289A.38, whichever period is later. The 
64.11 	county auditor may send the statement under paragraph (c) any time within three years 
64.12 	after the business becomes subject to repayment under subdivision 1.
64.13 	(h) A business is not entitled to any income tax or franchise tax benefits, including 
64.14 	refundable credits, for any part of the year in which the business becomes subject to 
64.15 	repayment under this section nor for any year thereafter. Property is not exempt from tax 
64.16 	under section 272.02, subdivision 64, for any taxes payable in the year following the year 
64.17 	in which the property became subject to repayment under this section nor for any year 
64.18 	thereafter. A business is not eligible for any sales tax benefits beginning with goods 
64.19 	or services purchased or first put to a taxable use on the day that the business becomes 
64.20 	subject to repayment under this section.
64.21 		Subd. 5.Waiver authority. (a) The commissioner may waive all or part of a 
64.22 	repayment required under subdivision 1, if the commissioner, in consultation with 
64.23 	the commissioner of employment and economic development and appropriate officials 
64.24 	from the local government units in which the qualified business is located, determines 
64.25 	that requiring repayment of the tax is not in the best interest of the state or the local 
64.26 	government units and the business ceased operating as a result of circumstances beyond 
64.27 	its control including, but not limited to:
64.28 	(1) a natural disaster;
64.29 	(2) unforeseen industry trends; or
64.30 	(3) loss of a major supplier or customer.
64.31 	(b)(1) The commissioner shall waive repayment required under subdivision 1a if 
64.32 	the commissioner has waived repayment by the operating business under subdivision 1, 
64.33 	unless the person that received benefits without having to operate a business in the zone 
64.34 	was a contributing factor in the qualified business becoming subject to repayment under 
64.35 	subdivision 1; 
65.1 	(2) the commissioner shall waive the repayment required under subdivision 1a, even 
65.2 	if the repayment has not been waived for the operating business if:
65.3 	(i) the person that received benefits without having to operate a business in the zone 
65.4 	and the business that operated in the zone are not related parties as defined in section 
65.5 	267(b) of the Internal Revenue Code of 1986, as amended through December 31, 2007; and
65.6 	(ii) actions of the person were not a contributing factor in the qualified business 
65.7 	becoming subject to repayment under subdivision 1.
65.8 		Subd. 6.Reconciliation. Where this section is inconsistent with section 116J.994, 
65.9 	subdivision 3, paragraph (e), or 6, or any other provisions of sections 116J.993 to 
65.10 	116J.995, this section prevails.

65.11 	EFFECTIVE DATE. The amendment to subdivision 4, paragraph (c), of this 
65.12 	section is effective the day following final enactment. The amendment to subdivision 4, 
65.13 	paragraph (f), is effective January 1, 2008, and applies to all businesses that become 
65.14 	subject to this section in 2008 and thereafter. The rest of this section is effective 
65.15 	retroactively from January 1, 2004, except that for violations that occur before the day 
65.16 	following final enactment, this section does not apply if the business has repaid the 
65.17 	benefits or the commissioner has granted a waiver.

65.18 	Sec. 2. [469.3191] BREACH OF AGREEMENTS BY BUSINESSES THAT 
65.19 	CONTINUE TO OPERATE IN ZONE.
65.20 	(a) A "business in violation of its business subsidy agreement but not subject to 
65.21 	section 469.319" means a business that is operating in violation of the business subsidy 
65.22 	agreement but maintains a level of operations in the zone that does not subject it to the 
65.23 	repayment provisions of section 469.319, subdivision 1, clause (1). 
65.24 	(b) A business described in paragraph (a) that does not sign a new or amended 
65.25 	business subsidy agreement, as authorized under paragraph (h), is subject to repayment 
65.26 	of benefits under section 469.319 from the day that it ceases to perform in the zone a 
65.27 	substantial level of activities described in the business subsidy agreement. 
65.28 	(c) A business described in paragraph (a) ceases being a qualified business after the 
65.29 	last day that it has to meet the goals stated in the agreement.
65.30 	(d) A business is not entitled to any income tax or franchise tax benefits, including 
65.31 	refundable credits, for any part of the year in which the business is no longer a qualified 
65.32 	business under paragraph (c), and thereafter. A business is not eligible for sales tax 
65.33 	benefits beginning with goods or services purchased or put to a taxable use on the day that 
65.34 	it is no longer a qualified business under paragraph (c). Property is not exempt from tax 
66.1 	under section 272.02, subdivision 64, for any taxes payable in the year following the year 
66.2 	in which the business is no longer a qualified business under paragraph (c), and thereafter.
66.3 	(e) A business described in paragraph (a) that wants to resume eligibility for benefits 
66.4 	under section 469.315 must request that the commissioner of employment and economic 
66.5 	development determine the length of time that the business is ineligible for benefits. The 
66.6 	commissioner shall determine the length of ineligibility by applying the proportionate 
66.7 	level of performance under the agreement to the total duration of the zone as measured 
66.8 	from the date that the business subsidy agreement was executed. The length of time 
66.9 	must not be less than one full year for each tax benefit listed in section 469.315. The 
66.10 	commissioner of employment and economic development and the appropriate local 
66.11 	government officials shall consult with the commissioner of revenue to ensure that the 
66.12 	period of ineligibility includes at least one full year of benefits for each tax. 
66.13 	(f) The length of ineligibility determined under paragraph (e) must be applied by 
66.14 	reducing the zone duration for the property by the duration of the ineligibility.
66.15 	(g) The zone duration of property that has been adjusted under paragraph (f) must 
66.16 	not be altered again to permit the business additional benefits under section 469.315.
66.17 	(h) A business described in paragraph (a) becomes eligible for benefits available 
66.18 	under section 469.315 by entering into a new or amended business subsidy agreement 
66.19 	with the appropriate local government unit. The new or amended agreement must cover 
66.20 	a period beginning from the date of ineligibility under the original business subsidy 
66.21 	agreement, through the zone duration determined by the commissioner under paragraph 
66.22 	(f). No exemption of property taxes under section 272.02, subdivision 64, is available 
66.23 	under the new or amended agreement for property taxes due or paid before the date of 
66.24 	the final execution of the new or amended agreement, but unpaid taxes due after that 
66.25 	date need not be paid.
66.26 	(i) A business that violates the terms of an agreement authorized under paragraph 
66.27 	(h) is permanently barred from seeking benefits under section 469.315 and is subject to 
66.28 	the repayment provisions under section 469.319 effective from the day that the business 
66.29 	ceases to operate as a qualified business in the zone under the second agreement. 

66.30 	EFFECTIVE DATE. This section is effective retroactively from January 1, 2004. 
66.31 	For violations that occur before the day following final enactment, this section does not 
66.32 	apply if the business has repaid the benefits or the commissioner has granted a waiver. 

66.33 	Sec. 3. [469.3192] PROHIBITION AGAINST AMENDMENTS TO BUSINESS 
66.34 	SUBSIDY AGREEMENT.
67.1 	Except as authorized under section 469.3191, under no circumstance shall terms 
67.2 	of any agreement required as a condition for eligibility for benefits listed under section 
67.3 	469.315 be amended to change job creation, job retention, or wage goals included in 
67.4 	the agreement.

67.5 	EFFECTIVE DATE. This section is effective the day following final enactment 
67.6 	and applies to all agreements executed before, on, or after the effective date.

67.7 	Sec. 4. [469.3193] CERTIFICATION OF CONTINUING ELIGIBILITY FOR 
67.8 	JOBZ BENEFITS.
67.9 	(a) By December 1 of each year, every qualified business must certify to the 
67.10 	commissioner, on a form prescribed by the commissioner, whether it is in compliance with 
67.11 	any agreement required as a condition for eligibility for benefits listed under section 
67.12 	469.315. A business that fails to submit the certification, or any business, including 
67.13 	those still operating in the zone, that submits a certification that the commissioner later 
67.14 	determines materially misrepresents the business's compliance with the agreement, is 
67.15 	subject to the repayment provisions under section 469.319 from January 1 of the year in 
67.16 	which the report is due or the date that the business became subject to section 469.319, 
67.17 	whichever is earlier. Any such business is permanently barred from obtaining benefits 
67.18 	under section 469.315. For purposes of this section, the bar applies to an entity and 
67.19 	also applies to any individuals or entities that have an ownership interest of at least 20 
67.20 	percent of the entity.
67.21 	(b) Before the sanctions under paragraph (a) apply to a business that fails to submit 
67.22 	the certification, the commissioner shall send notice to the business, demanding that the 
67.23 	certification be submitted within 30 days and advising the business of the consequences 
67.24 	for failing to do so. The commissioner shall notify the commissioner of revenue and the 
67.25 	appropriate job opportunity subzone administrator whenever notice is sent to a business 
67.26 	under this paragraph.
67.27 	(c) The certification required under this section is public. 
67.28 	(d) The commissioner shall promptly notify the commissioner of revenue of all 
67.29 	businesses that certify that they are not in compliance with the terms of their business 
67.30 	subsidy agreement and all businesses that fail to file the certification.

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

68.1 	ARTICLE 6
68.2 	MISCELLANEOUS

68.3 	Section 1. Minnesota Statutes 2006, section 16D.02, subdivision 3, is amended to read:
68.4 		Subd. 3.Debt. "Debt" means an amount owed to the state directly, or through a 
68.5 	state agency, on account of a fee, duty, lease, direct loan, loan insured or guaranteed by 
68.6 	the state, rent, service, sale of real or personal property, overpayment, fine, assessment, 
68.7 	penalty, restitution, damages, interest, tax, bail bond, forfeiture, reimbursement, liability 
68.8 	owed, an assignment to the state including assignments under section 256.741, the Social 
68.9 	Security Act, or other state or federal law, recovery of costs incurred by the state, or any 
68.10 	other source of indebtedness to the state. Debt also includes amounts owed to individuals 
68.11 	as a result of civil, criminal, or administrative action brought by the state or a state agency 
68.12 	pursuant to its statutory authority or for which the state or state agency acts in a fiduciary 
68.13 	capacity in providing collection services in accordance with the regulations adopted under 
68.14 	the Social Security Act at Code of Federal Regulations, title 45, section 302.33. When the 
68.15 	commissioner provides collection services pursuant to a debt qualification plan, debt also 
68.16 	includes an amount owed to the courts, local government units, Minnesota state colleges 
68.17 	and universities governed by the Board of Trustees of the Minnesota State Colleges and 
68.18 	Universities, or University of Minnesota ~~for which the commissioner provides collection~~ 
68.19 	~~services pursuant to contract~~. 

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

68.21 	Sec. 2. Minnesota Statutes 2006, section 16D.02, subdivision 6, is amended to read:
68.22 		Subd. 6.Referring agency. "Referring agency" means a state agency, local 
68.23 	government unit, Minnesota state colleges and universities governed by the Board of 
68.24 	Trustees of the Minnesota State Colleges and Universities, University of Minnesota, or 
68.25 	a court, that has entered into a debt qualification plan with the commissioner to refer 
68.26 	debts to the commissioner for collection.

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

68.28 	Sec. 3. Minnesota Statutes 2006, section 16D.04, subdivision 2, is amended to read:
68.29 		Subd. 2.Agency participation. (a) A referring agency may, at its option, refer debts 
68.30 	to the commissioner for collection. ~~The ultimate responsibility for the debt, including the~~ 
68.31 	~~reporting of the debt to the commissioner of finance and the decision with regard to the~~ 
68.32 	~~continuing collection and uncollectibility of the debt, remains with the referring agency.~~
69.1 	Decisions with regard to continuing collection and the uncollectibility of referred debts 
69.2 	shall be made by the commissioner who shall then notify the commissioner of finance and 
69.3 	the referring agency. A decision by the commissioner that a referred debt is uncollectible 
69.4 	does not prevent the referring agency from taking additional collection action.
69.5 	(b) When a debt owed to a state agency becomes 121 days past due, the state agency 
69.6 	must refer the debt to the commissioner for collection. This requirement does not apply 
69.7 	if there is a dispute over the amount or validity of the debt, if the debt is the subject of 
69.8 	legal action or administrative proceedings, or the agency determines that the debtor is 
69.9 	adhering to acceptable payment arrangements. The commissioner, in consultation with the 
69.10 	commissioner of finance, may provide that certain types of debt need not be referred to the 
69.11 	commissioner for collection under this paragraph. Methods and procedures for referral 
69.12 	must follow internal guidelines prepared by the commissioner of finance.
69.13 	(c) If the referring agency is a court, the court must furnish a debtor's Social Security 
69.14 	number to the commissioner when the court refers the debt.

69.15 	EFFECTIVE DATE. This section is effective for debts referred after December 
69.16 	31, 2008.

69.17 	Sec. 4. Minnesota Statutes 2006, section 270A.08, subdivision 1, is amended to read:
69.18 		Subdivision 1.Notice to debtor. Not later than five days after the claimant agency 
69.19 	has sent notification to the department pursuant to section 270A.07, subdivision 1, the 
69.20 	claimant agency shall send a written notification to the debtor asserting the right of the 
69.21 	claimant agency to the refund or any part thereof. If the notice is returned to the claimant 
69.22 	agency as undeliverable, or the claimant agency has reason to believe the debtor did 
69.23 	not receive the notice, the claimant agency shall obtain the ~~current~~ last known address 
69.24 	of the debtor from the commissioner and resend the corrected notice. If a debt has been 
69.25 	referred to the commissioner for collection under chapter 16D, notice is sufficient if the 
69.26 	commissioner sends the notice by regular mail to the debtor's last known address as shown 
69.27 	in the records of the commissioner.

69.28 	EFFECTIVE DATE. This section is effective for debts referred after December 
69.29 	31, 2008.

69.30 	Sec. 5. Minnesota Statutes 2006, section 270C.33, subdivision 5, is amended to read:
69.31 		Subd. 5.Prohibition against collection during appeal period of an order. No 
69.32 	collection action can be taken on an order of assessment, or any other order imposing a 
69.33 	liability, including the filing of liens under section 270C.63, and no late payment penalties 
70.1 	may be imposed when a return has been filed for the tax type and period upon which the 
70.2 	order is based, during the appeal period of an order. The appeal period of an order ends: 
70.3 	(1) 60 days after the order has been mailed to the taxpayer by the commissioner; (2) if an 
70.4 	administrative appeal is filed under section 270C.35, 60 days after determination of the 
70.5 	administrative appeal; (3) if an appeal to Tax Court is filed under chapter 271, when the 
70.6 	decision of the Tax Court is made; or (4) if an appeal to Tax Court is filed and the appeal is 
70.7 	based upon a constitutional challenge to the tax, 60 days after final determination of the 
70.8 	appeal. This subdivision does not apply to a jeopardy assessment under section 270C.36, 
70.9 	or a jeopardy collection under section 270C.36.

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