HF 2223

as introduced - 89th Legislature (2015 - 2016) Posted on 04/15/2015 09:17am

A bill for an act
relating to taxation; property; providing a reduced classification rate for
unimproved commercial and industrial property; amending Minnesota Statutes
2014, section 273.13, subdivision 24.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2014, section 273.13, subdivision 24, is amended to read:

Subd. 24.

Class 3.

new text begin (a) new text end Commercial and industrial property and utility real and
personal property is class 3a.

(1) Except as otherwise provided, each parcel of commercial, industrial, or utility
real property has a classification rate of 1.5 percent of the first tier of market value, and 2.0
percent of the remaining market value. In the case of contiguous parcels of property owned
by the same person or entity, only the value equal to the first-tier value of the contiguous
parcels qualifies for the reduced classification rate, except that contiguous parcels owned
by the same person or entity shall be eligible for the first-tier value classification rate on
each separate business operated by the owner of the property, provided the business is
housed in a separate structure. For the purposes of this subdivision, the first tier means the
first $150,000 of market value. Real property owned in fee by a utility for transmission
line right-of-way shall be classified at the classification rate for the higher tier.

For purposes of this subdivision, parcels are considered to be contiguous even if
they are separated from each other by a road, street, waterway, or other similar intervening
type of property. Connections between parcels that consist of power lines or pipelines do
not cause the parcels to be contiguous. Property owners who have contiguous parcels of
property that constitute separate businesses that may qualify for the first-tier classification
rate shall notify the assessor by July 1, for treatment beginning in the following taxes
payable year.

(2) All personal property that is: (i) part of an electric generation, transmission, or
distribution system; or (ii) part of a pipeline system transporting or distributing water, gas,
crude oil, or petroleum products; and (iii) not described in clause (3), and all railroad
operating property has a classification rate as provided under clause (1) for the first tier
of market value and the remaining market value. In the case of multiple parcels in one
county that are owned by one person or entity, only one first tier amount is eligible for the
reduced rate.

(3) The entire market value of personal property that is: (i) tools, implements, and
machinery of an electric generation, transmission, or distribution system; (ii) tools,
implements, and machinery of a pipeline system transporting or distributing water, gas,
crude oil, or petroleum products; or (iii) the mains and pipes used in the distribution of
steam or hot or chilled water for heating or cooling buildings, has a classification rate as
provided under clause (1) for the remaining market value in excess of the first tier.

new text begin (b) Unimproved property that is classified as commercial and industrial as
determined under subdivision 33, is class 3b. The market value of class 3b property
has a classification rate of 1.25 percent.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with assessment year 2016.
new text end