1.1                          A bill for an act
  1.2             relating to tax court; abolishing the tax court; 
  1.3             clarifying district court jurisdiction in tax law 
  1.4             cases; proposing coding for new law as Minnesota 
  1.5             Statutes, chapter 271A; repealing Minnesota Statutes 
  1.6             1998, sections 271.01, subdivisions 1, 1a, and 4a; 
  1.7             271.02; 271.03; 271.04; 271.05; 271.06; 271.07; 
  1.8             271.08; 271.09; 271.10; 271.12; 271.13; 271.15; 
  1.9             271.17; 271.18; 271.19; 271.20; and 271.21, 
  1.10            subdivisions 1, 3, 5, 6, 7, 8, 9, 10, and 11; 
  1.11            Minnesota Statutes 1999 Supplement, sections 271.01, 
  1.12            subdivision 5; and 271.21, subdivision 2. 
  1.13  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.14     Section 1.  [271A.01] [DEFINITIONS.] 
  1.15     For purposes of this chapter, the following terms have the 
  1.16  meanings given. 
  1.17     (a) "Commissioner" means the commissioner of the department 
  1.18  of revenue. 
  1.19     (b) "Tax laws" means the laws of this state governing 
  1.20  taxes, aids, and related matters administered by the 
  1.21  commissioner of revenue, laws dealing with property valuation, 
  1.22  assessment or taxation of property for property tax purposes, 
  1.23  and any other laws that contain provisions authorizing review of 
  1.24  taxes, aids, and related matters. 
  1.25     Sec. 2.  [271A.02] [TAX LAW CASES.] 
  1.26     Subdivision 1.  [DISTRICT COURT JURISDICTION.] (a) Except 
  1.27  for an appeal to the supreme court or any other appeal allowed 
  1.28  by law and except as otherwise provided by this section, the 
  1.29  district court has sole jurisdiction to hear and determine all 
  2.1   questions of law and fact arising under the tax laws of the 
  2.2   state. 
  2.3      (b) The district court has no jurisdiction in any case 
  2.4   dealing with property valuation or assessment for property tax 
  2.5   purposes until the taxpayer has appealed the valuation or 
  2.6   assessment to the county board of equalization, or in those 
  2.7   towns and cities which have not transferred their duties to the 
  2.8   county, the town or city board of equalization, except for: 
  2.9      (1) those taxpayers whose original assessments are 
  2.10  determined by the commissioner of revenue; and 
  2.11     (2) those taxpayers appealing a denial of a current year 
  2.12  application for the homestead classification for their property 
  2.13  if the denial was not reflected on a valuation notice issued in 
  2.14  the year. 
  2.15     (c) The district court has no jurisdiction in any case 
  2.16  involving an order of the state board of equalization unless a 
  2.17  taxpayer contests the valuation of property.  This section does 
  2.18  not prevent an appeal, as provided by law, to an administrative 
  2.19  agency, board of equalization, review under section 274.13, 
  2.20  subdivision 1c, or to the commissioner. 
  2.21     Subd. 2.  [HEARINGS; DETERMINATION OF ISSUES; DEFAULT.] The 
  2.22  district court shall hear, consider, and determine without a 
  2.23  jury every appeal de novo.  The court may empanel an advisory 
  2.24  jury upon the court's own motion.  The district court must hold 
  2.25  a public hearing in every case.  Parties may offer evidence and 
  2.26  arguments at the hearing.  The order of the commissioner or the 
  2.27  appropriate unit of government in every case is prima facie 
  2.28  valid.  When an appeal to the district court is taken from an 
  2.29  order or determination of the commissioner or from the 
  2.30  appropriate unit of government on a matter of tax law, the 
  2.31  proceeding is an original proceeding in the nature of a suit to 
  2.32  set aside or modify the order or determination.  If the 
  2.33  appellant does not appear, the district court shall enter its 
  2.34  order affirming the order of the commissioner of revenue or the 
  2.35  appropriate unit of government from which the appeal was taken. 
  2.36  If the department of revenue's sales ratio study is introduced 
  3.1   as evidence, the sales ratio data from the study is admissible 
  3.2   as evidence only as provided in section 278.05, subdivision 4. 
  3.3      Subd 3.  [WRITTEN ORDER.] The district court shall 
  3.4   determine every appeal under this chapter by written order 
  3.5   containing findings of fact and the decision of the court.  A 
  3.6   memorandum of the grounds of the decision must be appended.  The 
  3.7   court shall mail notice of the entry of the order and of the 
  3.8   substance of the decision to all parties.  A motion for 
  3.9   rehearing, which includes a motion for amended findings of fact, 
  3.10  conclusions of law, or a new trial, must be served by the moving 
  3.11  party within 15 days after mailing of the notice by the court as 
  3.12  specified in this subdivision, and the motion must be heard 
  3.13  within 30 days thereafter, unless the time for hearing is 
  3.14  extended by the court within the 30-day period for good cause 
  3.15  shown. 
  3.16     Subd. 4.  [ENTRY OF JUDGMENT.] Upon the filing of the order 
  3.17  of the district court under subdivision 3, judgment must be 
  3.18  entered in the same manner as in other orders of the district 
  3.19  court. 
  3.20     Subd. 5.  [RULES.] Except as provided in section 278.05, 
  3.21  subdivision 6, the rules of evidence and civil procedure for the 
  3.22  district court of Minnesota govern the procedures in the 
  3.23  district court under this chapter. 
  3.24     Sec. 3.  [271A.03] [VENUE.] 
  3.25     When an appeal is taken by a resident taxpayer from an 
  3.26  order of the commissioner not involving property taxes, venue 
  3.27  for the case is, at the election of the taxpayer, in Ramsey 
  3.28  county or in the district court judicial district in which the 
  3.29  taxpayer resides.  Venue is in Ramsey county for an appeal taken 
  3.30  by a nonresident taxpayer from an order of the commissioner. 
  3.31  Venue for all other cases arising under the tax laws of the 
  3.32  state is in the same judicial district as other civil matters 
  3.33  being tried in district court. 
  3.34     Sec. 4.  [271A.04] [REVIEW OF COMMISSIONER'S ORDERS.] 
  3.35     Subdivision 1.  [MANNER OF SEEKING REVIEW.] Except as 
  3.36  otherwise provided in section 270.07, subdivision 1, paragraph 
  4.1   (a), or any other law, an appeal to the district court may be 
  4.2   taken, as provided in this section, from any official order of 
  4.3   the commissioner respecting any tax, fee, or assessment, or any 
  4.4   matter pertaining to it, including the imposition of interest 
  4.5   and penalty, or any matter over which the court is granted 
  4.6   jurisdiction under section 271A.02, by any person directly 
  4.7   interested in or affected by, the order; or by any political 
  4.8   subdivision of the state that is directly or indirectly 
  4.9   interested in or affected by the order; by the attorney general 
  4.10  in behalf of the state; or by any resident taxpayer of the state 
  4.11  in behalf of the state if the attorney general, upon request, 
  4.12  refuses to appeal the order. 
  4.13     Within 60 days after notice of the making and filing of an 
  4.14  order of the commissioner, the appellant or appellant's attorney 
  4.15  must serve a notice of appeal on the commissioner and file the 
  4.16  original, with proof of service, on the district court 
  4.17  administrator.  The district court, for cause shown, may by 
  4.18  written order extend the time for appealing for an additional 
  4.19  period not exceeding 30 days.  The notice of appeal must be in 
  4.20  the form prescribed by the district court.  Within five days 
  4.21  after receipt, the commissioner shall transmit a copy of the 
  4.22  notice of appeal to the attorney general.  The attorney general 
  4.23  shall represent the commissioner, if requested, upon all appeals 
  4.24  under this section except if the attorney general has appealed 
  4.25  in behalf of the state.  If the attorney general deems it 
  4.26  against the interests of the state to represent the 
  4.27  commissioner, then the attorney general may intervene or be 
  4.28  substituted as an appellant in behalf of the state at any stage 
  4.29  of the proceedings. 
  4.30     Subd. 2.  [PLEADINGS.] Within 30 days after the service and 
  4.31  filing of the notice of appeal, unless the appeal is dismissed, 
  4.32  the commissioner shall make, certify, and file with the district 
  4.33  court a return composed of a copy of any application or petition 
  4.34  by which the proceeding was instituted and any other material 
  4.35  paper preceding the order of the commissioner, a copy of the 
  4.36  order appealed from, all relevant correspondence or other 
  5.1   communication, and a denial, admission, or explanation with 
  5.2   respect to each allegation of fact in the notice so far as not 
  5.3   covered by the order.  The district court, for cause shown, may 
  5.4   extend the time for filing the return for an additional period 
  5.5   not exceeding 30 days.  If the commissioner is required to 
  5.6   transmit a copy of the notice of appeal to the attorney general, 
  5.7   the commissioner shall, within ten days after service of the 
  5.8   notice of appeal upon the commissioner, transmit to the attorney 
  5.9   general a complete copy of all papers required for the return. 
  5.10  Allegations of new matter in the return shall be deemed to be 
  5.11  denied by the appellant. 
  5.12     Subd. 3.  [MODIFICATION OR RESCISSION OF ORDERS.] At any 
  5.13  time before final determination of an appeal by the district 
  5.14  court, the commissioner may, upon notice to the appellant and 
  5.15  with the approval of the attorney general, offer to modify or 
  5.16  rescind the order appealed from.  If the action is satisfactory 
  5.17  to the appellant and to all other parties appearing in the 
  5.18  proceeding, if any, and if they so stipulate in writing, the 
  5.19  commissioner shall make the proposed modification or rescission, 
  5.20  and the appeal is dismissed, with adjustment of costs as are 
  5.21  agreed upon between the commissioner and the appellant and 
  5.22  specified in the stipulation. 
  5.23     Sec. 5.  [271A.05] [APPEALS FROM OTHER ORDERS.] 
  5.24     Upon a final determination of any other matter over which 
  5.25  the court is granted jurisdiction under section 271A.02, the 
  5.26  taxpayer or the taxpayer's attorney shall file a petition or 
  5.27  notice of appeal as provided by law with the court administrator 
  5.28  of district court, with proof of service of the petition or 
  5.29  notice of appeal as required by law and within the time required 
  5.30  by law.  As used in this section, "final determination" includes 
  5.31  a notice of assessment and equalization for the year in question 
  5.32  received from the local assessor, an order of the local board of 
  5.33  equalization, or an order of a county board of equalization. 
  5.34     For an appeal or a petition concerning property valuation 
  5.35  for which the assessor, a local board of equalization, a county 
  5.36  board of equalization or the commissioner of revenue has issued 
  6.1   an order, the officer issuing the order shall be notified of the 
  6.2   filing of the appeal.  The notice of appeal or petition must be 
  6.3   in the form prescribed by the district court. 
  6.4      Sec. 6.  [271A.06] [APPEAL FEE.] 
  6.5      When filing the notice of appeal under section 271A.04 or 
  6.6   271A.05, the appellant shall pay to the court administrator of 
  6.7   the district court an appeal fee equal to the fee provided for 
  6.8   civil actions in the district court under section 357.021, 
  6.9   subdivision 2, clause (1); except that no appeal fee is required 
  6.10  of the commissioner of revenue, the attorney general, the state, 
  6.11  or any of its political subdivisions.  The provisions of chapter 
  6.12  563, providing for proceedings in forma pauperis, apply to 
  6.13  appeals under sections 271A.04 and 271A.05. 
  6.14     Sec. 7.  [271A.07] [TAX DUE OBLIGATION.] 
  6.15     When taking an appeal to the district court under this 
  6.16  chapter, the taxpayer shall pay at least the amount of the tax 
  6.17  or other obligation conceded by the taxpayer to be due, if any, 
  6.18  when it becomes due.  Doing so does not relieve the taxpayer 
  6.19  from complying with any other requirements of law.  The 
  6.20  provisions of sections 273.125, subdivision 5, and 278.03 govern 
  6.21  the filing with the district court of an appeal dealing with 
  6.22  property valuation, assessment, or taxation for property tax 
  6.23  purposes. 
  6.24     Sec. 8.  [271A.08] [REVIEW BY SUPREME COURT.] 
  6.25     Subdivision 1.  [CERTIORARI.] A review of any final order 
  6.26  of the district court under this chapter may be had upon 
  6.27  certiorari by the supreme court upon petition of any party to 
  6.28  the proceedings before the district court.  Review may be had on 
  6.29  the ground that the district court was without jurisdiction, 
  6.30  that the order of the court was not justified by the evidence or 
  6.31  was not in conformity with law, or that the court committed any 
  6.32  other error of law. 
  6.33     Subd. 2.  [SERVICE OF WRIT.] Within 60 days after notice of 
  6.34  the making and filing of the district court order, or the making 
  6.35  and filing of an order on a motion for rehearing, which includes 
  6.36  a motion for amended findings of fact, conclusions of law, or a 
  7.1   new trial, the petitioner for review shall obtain from the 
  7.2   supreme court a writ of certiorari, and shall serve the same 
  7.3   upon all other parties appearing in the proceedings before the 
  7.4   district court, and shall file the original, with proof of 
  7.5   service, with the court administrator of the district court. 
  7.6   Every petitioner, except the attorney general, the commissioner 
  7.7   of revenue, the state, and its political subdivisions, shall 
  7.8   also pay to the court administrator the fee prescribed by rule 
  7.9   103.01 of Minnesota Rules of Civil Appellate Procedure which 
  7.10  must be disposed of in the manner provided by that rule, and 
  7.11  file a bond or make a deposit in like manner and amount as in 
  7.12  the case of other appeals from the district court.  The fee must 
  7.13  be disposed of as in such cases.  Return upon the writ must be 
  7.14  made to the supreme court and the matter heard and determined by 
  7.15  the court as in other certiorari cases, subject to the 
  7.16  provisions of this chapter and to the rules as the court 
  7.17  prescribes for cases arising under it. 
  7.18     Sec. 9.  [271A.09] [WHEN ORDER EFFECTIVE.] 
  7.19     No order for refundment by the commissioner of revenue, the 
  7.20  appropriate unit of government, or the district court takes 
  7.21  effect until the time for appeal or review of it has expired. 
  7.22  Otherwise, every order of the commissioner, the appropriate unit 
  7.23  of government, or the district court takes effect immediately 
  7.24  upon the filing of it, and no appeal or review stays the 
  7.25  execution of it or extends the time for payment of any tax or 
  7.26  other obligation, unless otherwise expressly provided by law.  
  7.27  However, if an order which has been acted upon, in whole or in 
  7.28  part, is set aside or modified upon appeal, the determination 
  7.29  upon appeal or review supersedes the order appealed from and is 
  7.30  binding upon all parties affected by it.  Adjustments necessary 
  7.31  to give effect to the order must be made accordingly.  The 
  7.32  district court may enjoin enforcement of the order of the 
  7.33  commissioner being appealed.  If it is finally determined upon 
  7.34  appeal or review that any person is entitled to refundment of 
  7.35  any amount which has been paid for a tax or other obligation, 
  7.36  the amount, unless otherwise provided by law, shall be paid to 
  8.1   the person by the state treasurer, or other proper officer, out 
  8.2   of funds derived from taxes of the same kind, if available for 
  8.3   the purpose, or out of other available funds, if any, with 
  8.4   interest at the rate specified in section 270.76 from the date 
  8.5   of payment of the tax, unless a different rate of interest is 
  8.6   otherwise provided by law, then the other rate applies, upon 
  8.7   certification by the commissioner of revenue, the appropriate 
  8.8   unit of government, the district court, or the supreme court. 
  8.9      If, within 120 days after a decision of the district court 
  8.10  under this chapter becomes final, the commissioner does not 
  8.11  refund the overpayment determined by the court, together with 
  8.12  interest, on motion by the taxpayer, the district court may 
  8.13  order the refund of the overpayment and interest, and award 
  8.14  reasonable litigation costs for bringing the motion.  If any 
  8.15  tax, assessment, or other obligation is increased on appeal or 
  8.16  review, the increase is added to the original amount and may be 
  8.17  enforced and collected with it. 
  8.18     Sec. 10.  [271A.10] [COSTS AND DISBURSEMENTS.] 
  8.19     Upon the determination of any appeal under this chapter 
  8.20  before the district court, or of any review by the supreme 
  8.21  court, the costs and disbursements are taxed and allowed in 
  8.22  favor of the prevailing party and against the losing party as in 
  8.23  other civil actions or, if there has been an offer of judgment 
  8.24  or settlement by a party prior to ten days before the court 
  8.25  hears the appeal, pursuant to Minnesota Rules of Civil 
  8.26  Procedure, rule 68.  If a person liable for a tax or other 
  8.27  obligation has lost an appeal or review instituted by the 
  8.28  person, and the district court determines that the person 
  8.29  instituted the same merely for the purposes of delay, or that 
  8.30  the taxpayer's position in the proceedings is frivolous, the 
  8.31  district court may, in its discretion, assess the taxpayer 
  8.32  additional costs, commensurate with the expense incurred and 
  8.33  services performed by the agencies of the state in connection 
  8.34  with the appeal, but not exceeding $5,000 in any case.  Costs 
  8.35  and disbursements allowed against the taxpayer are added to the 
  8.36  tax or other obligation determined to be due and are payable 
  9.1   with it.  To the extent described in section 15.471, where an 
  9.2   award of costs and attorney fees is authorized under section 
  9.3   15.472, the costs and fees are allowed against the state, 
  9.4   including expenses incurred by the taxpayer to administratively 
  9.5   protest or appeal to the department of revenue the order, 
  9.6   decision, or report of the commissioner that is the subject of 
  9.7   the district court proceedings.  Costs and disbursements allowed 
  9.8   against the state or other public agencies must be paid out of 
  9.9   funds received from taxes or other obligations of the kind 
  9.10  involved in the proceeding or other funds of the agency 
  9.11  concerned appropriated and available therefor.  Witnesses in 
  9.12  proceedings under this chapter must receive the fees provided by 
  9.13  law for witnesses in the district court, to be paid in the first 
  9.14  instance by the parties by whom the witnesses were called, and 
  9.15  to be taxed and allowed as provided under this chapter. 
  9.16     Sec. 11.  [INSTRUCTION TO REVISOR.] 
  9.17     The revisor of statutes shall prepare a bill for 
  9.18  introduction in the 2001 regular legislative session that 
  9.19  replaces cross-references to the sections repealed by section 12 
  9.20  and that replaces references to the tax court with references to 
  9.21  the district court, along with any other changes in references 
  9.22  necessitated by the elimination of the tax court under this act. 
  9.23     Sec. 12.  [REPEALER.] 
  9.24     Minnesota Statutes 1998, sections 271.01, subdivisions 1, 
  9.25  1a, and 4a; 271.02; 271.03; 271.04; 271.05; 271.06; 271.07; 
  9.26  271.08; 271.09; 271.10; 271.12; 271.13; 271.15; 271.17; 271.18; 
  9.27  271.19; 271.20; and 271.21, subdivisions 1, 3, 5, 6, 7, 8, 9, 
  9.28  10, and 11; and Minnesota Statutes 1999 Supplement, sections 
  9.29  271.01, subdivision 5; and 271.21, subdivision 2, are repealed. 
  9.30     Sec. 13.  [EFFECTIVE DATE.] 
  9.31     Sections 1 to 12 are effective July 1, 2000.