1.1                          A bill for an act
  1.2             relating to property taxation; exempting agricultural 
  1.3             land from the general education levy; increasing 
  1.4             general education aid; amending Minnesota Statutes 
  1.5             1998, sections 127A.48, by adding a subdivision; and 
  1.6             275.08, subdivision 1b. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 1998, section 127A.48, is 
  1.9   amended by adding a subdivision to read: 
  1.10     Subd. 6a.  [AGRICULTURAL LAND EXEMPTION.] The value of 
  1.11  agricultural property classified as class 2a or 2b under section 
  1.12  273.13, subdivision 23, except for the value of the house, 
  1.13  garage, and one acre of land in the case of an agricultural 
  1.14  homestead, shall be excluded from a school district's adjusted 
  1.15  net tax capacity for the purpose of determining its general 
  1.16  education levy under section 126C.13, subdivision 2. 
  1.17     Sec. 2.  Minnesota Statutes 1998, section 275.08, 
  1.18  subdivision 1b, is amended to read: 
  1.19     Subd. 1b.  [COMPUTATION OF TAX RATES.] (a) The amounts 
  1.20  certified to be levied against net tax capacity under section 
  1.21  275.07 by an individual local government unit shall be divided 
  1.22  by the total net tax capacity of all taxable properties within 
  1.23  the local government unit's taxing jurisdiction.  The resulting 
  1.24  ratio, the local government's local tax rate, multiplied by each 
  1.25  property's net tax capacity shall be each property's net tax 
  1.26  capacity tax for that local government unit before reduction by 
  2.1   any credits.  
  2.2      (b) The portion of the school district tax rate for the 
  2.3   general education levy under section 126C.13, subdivision 2, 
  2.4   shall not be levied on property classified as class 2a or 2b 
  2.5   under section 273.13, subdivision 23, except that the tax shall 
  2.6   be levied on the house, garage, and one acre of land of an 
  2.7   agricultural homestead.  The county auditor shall deduct the net 
  2.8   tax capacity of property qualifying for this exemption before 
  2.9   determining a school district's general education levy tax rate. 
  2.10     (c) Any amount certified to the county auditor to be levied 
  2.11  against market value shall be divided by the total referendum 
  2.12  market value of all taxable properties within the taxing 
  2.13  district.  The resulting ratio, the taxing district's new 
  2.14  referendum tax rate, multiplied by each property's referendum 
  2.15  market value shall be each property's new referendum tax before 
  2.16  reduction by any credits.  For the purposes of this subdivision, 
  2.17  "referendum market value" means the market value as defined in 
  2.18  section 126C.01, subdivision 3. 
  2.19     Sec. 3.  [GENERAL EDUCATION LEVY REDUCTION.] 
  2.20     For fiscal year 2001, general education aid under Minnesota 
  2.21  Statutes, section 126C.13, subdivision 4, is increased by 
  2.22  $80,300,000 over the general education aid expenditure for 
  2.23  fiscal year 2000.  The general education aid increase under this 
  2.24  provision must be used to decrease the general education levy 
  2.25  under Minnesota Statutes, section 126C.13, subdivision 1, by 
  2.26  $80,300,000 for taxes payable in 2000. 
  2.27     Sec. 4.  [EFFECTIVE DATE.] 
  2.28     This act is effective for taxes levied in 1999, payable in 
  2.29  2000, and subsequent years.