Minnesota Legislature
Office of the Revisor of Statutes
Minnesota Session Laws - 1991, Regular Session
Key: (1) language to be deleted (2) new language
Laws of Minnesota 1991
CHAPTER 291-H.F.No. 1698
An act relating to the financing and operation of
government in Minnesota; establishing a local
government trust fund; allowing a local sales and use
tax to be imposed; establishing an advisory commission
on intergovernmental relations; modifying the
administration, computation, collection, and
enforcement of taxes; imposing taxes; changing tax
rates, bases, credits, exemptions, withholding, and
payments; modifying levy limits and aids to local
governments; reducing the amount in the budget and
cash flow reserve account; modifying certain local
taxes and fees; updating references to the Internal
Revenue Code; modifying provisions relating to
political campaign contribution refunds; modifying tax
increment financing laws; changing certain bonding
provisions; changing provisions for light rail
transit; changing certain eminent domain powers;
changing provisions relating to certain ambulance and
emergency services personnel plans; establishing
programs to provide incentives for local government
service sharing and mergers; changing definitions;
making technical corrections and clarifications;
enacting provisions relating to certain cities,
counties, school districts and watershed districts;
appropriating money; amending Minnesota Statutes 1990,
sections 10A.322, subdivisions 1 and 4; 10A.43,
subdivisions 3 and 4; 10A.44, subdivision 4; 13.51,
subdivision 2, and by adding a subdivision; 13.54, by
adding a subdivision; 14.03, subdivision 3; 16A.15,
subdivision 6; 18.022, subdivision 2; 43A.316,
subdivision 9; 47.58, subdivision 6; 60A.19,
subdivision 8; 69.011, subdivisions 1 and 3; 69.021,
subdivisions 2, 4, 5, 6, 7, 8, and 9; 69.54; 84.82, by
adding a subdivision; 86B.401, by adding a
subdivision; 115B.24, subdivision 2; 116.07,
subdivision 4h; 124A.03, subdivision 2, and by adding
a subdivision; 138.17, subdivision 1a; 171.06, by
adding a subdivision; 216B.36; 268.161, subdivision 1;
270.067, subdivisions 1 and 2; 270.11, subdivision 6;
270.12, subdivision 2, and by adding a subdivision;
270.274, subdivision 1; 270.60; 270.66, subdivision 3;
270.68, subdivision 1; 270.69, subdivisions 2, 8, 9,
and by adding a subdivision; 270.70, subdivision 10;
270.703, subdivision 2; 270.75, subdivision 4;
270A.03, subdivision 7; 270B.09; 271.04; 271.21,
subdivision 6; 272.02, subdivisions 1 and 4; 272.025,
subdivision 1; 272.03, subdivision 1; 272.31; 272.479;
272.482; 272.483; 272.485; 272.486; 272.67,
subdivision 6; 273.11, subdivision 1; 273.111,
subdivision 6; 273.112, subdivision 7; 273.12;
273.124, subdivisions 1, 6, 9, 13, 14, and 15; 273.13,
subdivisions 22, 23, 25, 31, 32, and by adding a
subdivision; 273.1398, subdivisions 1, 3, 5, 6, and 7;
273.1399, subdivisions 1 and 3; 274.19, subdivision 3;
275.065, subdivisions 3, 5a, and 6; 275.08,
subdivision 1b; 275.125, by adding a subdivision;
275.50, subdivisions 5 and 5a, as amended; 275.51,
subdivisions 3f, 3h, 3j, and 7; 276.04, subdivision 2;
276.041; 277.01; 278.01, subdivision 1; 278.05,
subdivision 4, and by adding a subdivision; 279.01,
subdivisions 1 and 2; 279.03, subdivision 1a; 279.06;
281.17; 282.01, subdivision 1; 282.33, subdivision 1;
287.05; 287.22; 289A.01; 289A.02, by adding a
subdivision; 289A.08, by adding a subdivision;
289A.11, subdivision 1; 289A.12, by adding a
subdivision; 289A.18, subdivisions 1, 2, and 4;
289A.19, subdivisions 1 and 2; 289A.20, subdivisions
1, 2, 4, and by adding a subdivision; 289A.26,
subdivisions 1, 6, and by adding a subdivision;
289A.30, subdivision 1; 289A.31, subdivision 1;
289A.35; 289A.37, subdivision 1; 289A.38, subdivisions
9, 10, and 12; 289A.39, subdivision 1, as amended;
289A.42, subdivisions 1 and 2; 289A.50, subdivision 1;
289A.56, subdivision 2; 289A.60, subdivisions 2, 4,
12, 15, and by adding a subdivision; 290.01,
subdivisions 19, 19a, and 19d; 290.014, subdivisions
2, 3, 4, and 5; 290.05, subdivision 3; 290.06,
subdivisions 2c, 2d, 21, 22, and 23; 290.067,
subdivisions 1 and 2a; 290.068, subdivisions 1, 2, and
5; 290.0802, subdivision 1; 290.091, subdivisions 1
and 2; 290.0921, subdivision 8; 290.0922, subdivision
1, and by adding a subdivision; 290.17, subdivisions
1, 2, and 5; 290.191, subdivisions 6, 8, and 11;
290.35, subdivision 3; 290.611, subdivision 1; 290.92,
subdivisions 1, 4b, 4c, 12, 26, 27, and by adding a
subdivision; 290.9727, subdivisions 1, 3, and by
adding subdivisions; 290A.03, subdivisions 3 and 7;
290A.04, subdivision 2h; 290A.05; 290A.091; 295.01,
subdivision 10; 296.01, subdivision 25; 296.026,
subdivisions 1, 2, 7, and by adding subdivisions;
296.14, subdivision 1; 297.01, subdivision 7; 297.02,
subdivision 1; 297.03, subdivisions 1, 2, 4, 5, and 6;
297.07, subdivision 5; 297.08, subdivision 1; 297.11,
subdivision 1, and by adding subdivisions; 297.35,
subdivision 1; 297.43, by adding a subdivision;
297A.01, subdivisions 3, 4, 8, and by adding a
subdivision; 297A.02, subdivision 2; 297A.14, by
adding a subdivision; 297A.21, subdivisions 1 and 4;
297A.211, subdivisions 2 and 3; 297A.24; 297A.25,
subdivisions 1, 9, 10, 12, and by adding a
subdivision; 297A.255, subdivision 5; 297A.259;
297A.44, subdivision 1, and by adding a subdivision;
297A.45; 297B.09, by adding a subdivision; 297C.03,
subdivisions 1 and 6; 297C.04; 297C.10, by adding a
subdivision; 297D.01, subdivision 3; 297D.02; 297D.04;
297D.05; 297D.07; 297D.09, subdivisions 1 and 1a;
297D.11; 297D.12, subdivision 1; 297D.13, subdivisions
1 and 3; 297D.14; 298.01, subdivisions 3, 4, and by
adding subdivisions; 298.015, subdivision 1; 298.16;
298.21; 298.27; 325D.32, subdivision 10; 336.9-411;
349.212, subdivision 4; 353D.01; 353D.02; 353D.03;
353D.05; 353D.06; 357.18, subdivision 2; 375.192,
subdivision 2; 386.46; 398A.04, subdivision 8;
414.031, subdivision 6; 414.0325, subdivision 4;
414.033, subdivision 7; 414.06, subdivision 4;
414.061, subdivision 3; 430.102, subdivisions 3 and 4;
462C.03, subdivision 10; 469.012, subdivision 8;
469.167, subdivision 2; 469.171, by adding a
subdivision; 469.174, subdivisions 7 and 10; 469.176,
subdivision 1; 469.1763, subdivisions 1, 2, 3, 4, and
by adding a subdivision; 469.177, subdivisions 1 and
8; 469.1771, subdivisions 2 and 4; 469.179, by adding
a subdivision; 469.1831, subdivision 4; 473.3994, by
adding a subdivision; 473.843, subdivision 3; 473F.01;
473F.02, subdivisions 3, 8, 12, and 13; 473F.05;
473F.06; 473F.07; 473F.08, subdivisions 2, 5, and 6;
473F.09; 473F.13, subdivision 1; 477A.011,
subdivisions 27, as amended, 28, as amended, and by
adding a subdivision; 477A.012, subdivision 1, as
amended, and by adding a subdivision; 477A.013,
subdivisions 1, as amended, and 3, as amended;
477A.014, subdivisions 1, as amended, 4, and by adding
subdivisions; 477A.03, subdivision 1; 508.25; 508A.25;
515A.1-105, subdivision 1; and 515A.4-102; Laws 1974,
chapter 285, section 4, as amended; Laws 1980, chapter
511, section 1, subdivision 2; Laws 1983, chapter 342,
article 19, section 1; Laws 1986, chapter 462, section
31; Laws 1988, chapter 719, article 16, section 1,
subdivision 3; Laws 1989, First Special Session
chapter 1, article 5, section 50; and article 14,
section 16; and Laws 1990, chapter 604, article 2,
section 22; article 3, sections 46, subdivision 1; 49,
subdivision 3; 50, subdivision 3; 51, subdivision 3;
59, subdivision 2; and 61, subdivision 2; article 4,
section 22; article 6, sections 9 and 11; article 7,
sections 29, subdivision 1, and 30, subdivision 7;
proposing coding for new law in Minnesota Statutes,
chapters 3; 16A; 47; 117; 268; 270; 272; 273; 275;
277; 290; 295; 296; 297; 297A; 325D; 353D; 465; 469;
and 477A; repealing Minnesota Statutes 1990, sections
272.487; 272.50; 272.51; 272.52; 272.53; 273.137;
277.02; 277.03; 277.05; 277.06; 277.07; 277.08;
277.09; 277.10; 277.11; 277.12; 277.13; 289A.19,
subdivision 6; 290.068, subdivision 6; 290.069,
subdivisions 2a, 4a, and 4b; 290.17, subdivision 7;
290.191, subdivision 7; 290.48, subdivisions 5 and 8;
296.028; 297A.257; 297A.39, subdivision 9; 298.05;
298.06; 298.07; 298.08; 298.09; 298.10; 298.11;
298.12; 298.13; 298.14; 298.15; 298.19; 298.20;
473F.02, subdivisions 9, 11, 16, 17, 18, 19, and 20;
473F.12; 473F.13, subdivisions 2 and 3; 477A.012;
477A.013; 477A.014; 477A.015; and 477A.03; Laws 1986,
chapter 399, article 1, section 5; Laws 1990, chapter
604, article 4, section 19; and Laws 1991, chapter 2,
article 8, sections 5, 8, and 9.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
ARTICLE 1
PROPERTY TAXES
Section 1. Minnesota Statutes 1990, section 13.51,
subdivision 2, is amended to read:
Subd. 2. [INCOME PROPERTY ASSESSMENT DATA.] The following
data collected by political subdivisions from individuals or
business entities concerning income properties are classified as
private or nonpublic data pursuant to section 13.02,
subdivisions 9 and 12:
(a) detailed income and expense figures for the current
year plus the previous three years;
(b) average vacancy factors for the previous three years;
(c) verified net rentable areas or net usable areas,
whichever is appropriate;
(d) anticipated income and expenses for the current year;
and
(e) projected vacancy factor for the current year; and
(f) lease information.
Sec. 2. Minnesota Statutes 1990, section 13.51, is amended
by adding a subdivision to read:
Subd. 3. [DATA ON INCOME OF INDIVIDUALS.] Income
information on individuals collected and maintained by political
subdivisions to determine eligibility of property for
classification 4c under section 273.13, subdivision 25,
paragraph (c), is private data on individuals as defined in
section 13.02, subdivision 12.
Sec. 3. Minnesota Statutes 1990, section 13.54, is amended
by adding a subdivision to read:
Subd. 5. [PRIVATE DATA ON INDIVIDUALS.] Income information
on individuals collected and maintained by a housing agency to
determine eligibility of property for classification 4c under
section 273.13, subdivision 25, paragraph (c), is private data
on individuals as defined in section 13.02, subdivision 12. The
data may be disclosed to the county and local assessors
responsible for determining eligibility of the property for
classification 4c.
Sec. 4. [117.57] [AUTHORITIES; RAILROAD PROPERTIES.]
Subdivision 1. [EMINENT DOMAIN.] The power of eminent
domain of an authority, as defined in section 469.174,
subdivision 2, extends to railroad properties located within the
authority's limits, provided:
(1) the railroad property is not a line of track for which
abandonment is required under federal law, or if it is a line of
track for which abandonment is required under federal law,
abandonment has been approved;
(2) the railroad property is not currently used for the
following activities of the railroad, not including storage,
maintenance, and repair activities:
(i) switching;
(ii) loading or unloading; or
(iii) classification activities;
(3) some part of the property contains land pollution as
defined in section 116.06, or contains a release or threatened
release of petroleum, as provided in chapter 115C, or contains a
release or threatened release of a pollutant, contaminant,
hazardous substance, or hazardous waste, as provided in chapter
115B; and
(4) the authority intends to develop the property and has a
plan for its cleanup and development within five years in order
to maximize its market value.
Property in current use under clause (2) includes only that
area which is reasonably necessary for current operation.
Upon a showing by the petitioner in condemnation
proceedings that the conditions described in clauses (1) to (3)
exist, then the public use to which the authority would put the
property is presumed a superior public use to railroad use or
any other past, present, or proposed future use. A railroad may
rebut the presumption by clear and convincing evidence that the
railroad use is a superior use.
Subd. 2. [RELATION TO STATE RAIL BANK.] Nothing in this
section shall supersede the provisions of section 222.63.
Subd. 3. [RELATION TO REGIONAL RAILROAD AUTHORITIES.] An
authority shall not be adjudged to have a superior public use to
that of a regional railroad authority as defined in section
398A.01, a railroad property which has been identified and
approved as a light rail corridor by the metropolitan council
under chapter 473, or a state trail covered by section 85.015.
Subd. 4. [LINE OF TRACK FOR AGRICULTURAL USE.] (a) Except
as provided in paragraph (b), subdivision 1 does not apply to
railroad property that is in a county outside of the
metropolitan area as defined in section 473.121, subdivision 2,
if:
(1) the property is a line of track in actual use; and
(2) the line of track is the principal means of
transportation for an agricultural use, as defined in section
17.81, subdivision 4, by an owner or lessee of real estate
abutting the line of track.
(b) The line of track may be acquired under subdivision 1
with the written consent of all the owners or lessees described
in paragraph (a), clause (2).
Subd. 5. [RELOCATION COSTS.] No property with ongoing
railroad use at the time of acquisition may be acquired under
this section without payment of the costs of relocation under
section 117.52.
Subd. 6. [QUICK TAKE LIMITED.] In a condemnation under
this section, where the authority seeks title and possession
under section 117.042, the time provided in that section must be
extended by the court for a period, not to exceed 150 days, if
reasonably required for the relocation of any ongoing railroad
use at the time of the acquisition.
Subd. 7. [COAL SLURRY PIPELINES.] No property may be
acquired under this section for use as a coal slurry pipeline or
other related facility.
Sec. 5. Minnesota Statutes 1990, section 124A.03,
subdivision 2, is amended to read:
Subd. 2. [REFERENDUM LEVY.] (a) The levy authorized by
section 124A.23, subdivision 2, may be increased in the amount
approved by the voters of the district at a referendum called
for the purpose. The referendum may be called by the school
board or shall be called by the school board upon written
petition of qualified voters of the district. Unless the
referendum is conducted by mail under paragraph (g), the
referendum must be held on the first Tuesday after the first
Monday in November. The ballot shall state the maximum amount
of the increased levy as a percentage of net tax capacity, the
amount that will be raised by that local tax rate in the first
year it is to be levied, and that the local tax rate shall be
used to finance school operations. The ballot may state that
existing levy authority is expiring. In this case, the ballot
may also compare the proposed levy authority to the existing
expiring levy authority, and express the proposed increase as
the amount, if any, over the expiring authority. The ballot
shall designate the specific number of years for which the
referendum authorization shall apply. The ballot may contain a
textual portion with the information required in this
subdivision and a question stating substantially the following:
"Shall the increase in the levy proposed by (petition to)
the board of ........., School District No. .., be approved?"
If approved, the amount provided by the approved local tax
rate applied to the net tax capacity for the year preceding the
year the levy is certified shall be authorized for certification
for the number of years approved, if applicable, or until
revoked or reduced by the voters of the district at a subsequent
referendum.
(b) The school board shall prepare and deliver by first
class mail at least 15 days but no more than 30 days prior to
the day of the referendum to each taxpayer at the address listed
on the school district's current year's assessment roll, a
notice of the referendum and the proposed levy increase. For
the purpose of giving mailed notice under this subdivision,
owners shall be those shown to be owners on the records of the
county auditor or, in any county where tax statements are mailed
by the county treasurer, on the records of the county
treasurer. Every property owner whose name does not appear on
the records of the county auditor or the county treasurer shall
be deemed to have waived this mailed notice unless the owner has
requested in writing that the county auditor or county
treasurer, as the case may be, include the name on the records
for this purpose. The notice must project the anticipated
amount of increase in annual dollars and annual percentage for
typical residential homesteads, agricultural homesteads,
apartments, and commercial-industrial property within the school
district.
The notice for a referendum may state that an existing
referendum levy is expiring and project the anticipated amount
of increase over the existing referendum levy, if any, in annual
dollars and annual percentage for typical residential
homesteads, agricultural homesteads, apartments, and
commercial-industrial property within the school district.
The notice must include the following statement: "In 1989
the legislature reduced property taxes for education by
increasing the state share of funding for education. However,
state aid for cities and townships was reduced by a
corresponding amount. As a result, property taxes for cities
and townships may increase. Passage of this referendum will
result in an increase in your property taxes."
(c) A referendum on the question of revoking or reducing
the increased levy amount authorized pursuant to paragraph (a)
may be called by the school board and shall be called by the
school board upon the written petition of qualified voters of
the district. A levy approved by the voters of the district
pursuant to paragraph (a) must be made at least once before it
is subject to a referendum on its revocation or reduction for
subsequent years. Only one revocation or reduction referendum
may be held to revoke or reduce a levy for any specific year and
for years thereafter.
(d) A petition authorized by paragraph (a) or (c) shall be
effective if signed by a number of qualified voters in excess of
15 percent of the registered voters of the school district on
the day the petition is filed with the school board. A
referendum invoked by petition shall be held on the date
specified in paragraph (a).
(e) The approval of 50 percent plus one of those voting on
the question is required to pass a referendum authorized by this
subdivision.
(f) At least 15 days prior to the day of the referendum,
the district shall submit a copy of the notice required under
paragraph (b) to the commissioner of education. Within 15 days
after the results of the referendum have been certified by the
school board, or in the case of a recount, the certification of
the results of the recount by the canvassing board, the district
shall notify the commissioner of education of the results of the
referendum.
(g) Any referendum under this section held on a day other
than the first Tuesday after the first Monday in November must
be conducted by mail in accordance with section 204B.46.
Notwithstanding paragraph (b) to the contrary, in the case of a
referendum conducted by mail under this paragraph, the notice
required by paragraph (b) shall be prepared and delivered by
first class mail at least 20 days before the referendum.
Sec. 6. Minnesota Statutes 1990, section 124A.03, is
amended by adding a subdivision to read:
Subd. 2a. [SCHOOL REFERENDUM LEVY; MARKET
VALUE.] Notwithstanding the provisions of subdivision 2, a
school referendum levy approved after November 1, 1992, for
taxes payable in 1993 and thereafter, shall be levied against
the market value of all taxable property. Any referendum levy
amount subject to the requirements of this subdivision shall be
certified separately to the county auditor under section 275.07.
The ballot shall state the maximum amount of the increased
levy as a percentage of market value, the amount that will be
raised by that new school referendum tax rate in the first year
it is to be levied, and that the new school referendum tax rate
shall be used to finance school operations.
If approved, the amount provided by the new school
referendum tax rate applied to the market value for the year
preceding the year the levy is certified, shall be authorized
for certification for the number of years approved, if
applicable, or until revoked or reduced by the voters of the
district at a subsequent referendum.
All other provisions of subdivision 2 that do not conflict
with this subdivision shall apply to referendum levies under
this subdivision.
Sec. 7. Minnesota Statutes 1990, section 270.12,
subdivision 2, is amended to read:
Subd. 2. The board shall meet annually between April 15
and June 30 at the office of the commissioner of revenue and
examine and compare the returns of the assessment of the
property in the several counties, and equalize the same so that
all the taxable property in the state shall be assessed at its
market value, subject to the following rules:
(1) The board shall add to the aggregate valuation of the
real property of every county, which the board believes to be
valued below its market value in money, such percent as will
bring the same to its market value in money;
(2) The board shall deduct from the aggregate valuation of
the real property of every county, which the board believes to
be valued above its market value in money, such percent as will
reduce the same to its market value in money;
(3) If the board believes the valuation for a part of a
class determined by a range of market value under clause (8), a
class, or classes of the real property of any town or district
in any county, or the valuation for a part of a class, a class,
or classes of the real property of any county not in towns or
cities, should be raised or reduced, without raising or reducing
the other real property of such county, or without raising or
reducing it in the same ratio, the board may add to, or take
from, the valuation of a part of a class, a class, or classes in
any one or more of such towns or cities, or of the property not
in towns or cities, such percent as the board believes will
raise or reduce the same to its market value in money;
(4) The board shall add to the aggregate valuation of any
class of personal property of any county, town, or city, which
the board believes to be valued below the market value thereof,
such percent as will raise the same to its market value in
money;
(5) The board shall take from the aggregate valuation of
any class of personal property in any county, town or city,
which the board believes to be valued above the market value
thereof, such percent as will reduce the same to its market
value in money;
(6) The board shall not reduce the aggregate valuation of
all the property of the state, as returned by the several county
auditors, more than one percent on the whole valuation thereof;
(7) When it would be of assistance in equalizing values the
board may require any county auditor to furnish statements
showing assessments of real and personal property of any
individuals, firms, or corporations within the county. The
board shall consider and equalize such assessments and may
increase the assessment of individuals, firms, or corporations
above the amount returned by the county board of equalization
when it shall appear to be undervalued, first giving notice to
such persons of the intention of the board so to do, which
notice shall fix a time and place of hearing. The board shall
not decrease any such assessment below the valuation placed by
the county board of equalization; and
(8) In equalizing values pursuant to this section, the
board shall utilize a 12-month assessment/sales ratio study
conducted by the department of revenue containing only sales
that are filed in the county auditor's office under section
272.115, by November 1 of the previous year and that occurred
between October 1 of the year immediately preceding the previous
year and September 30 of the previous year.
The assessment/sales ratio study may separate the values of
residential property into market value categories. The board
may adjust the market value categories and the number of
categories as necessary to create an adequate sample size for
each market value category. The board may determine the
adequate sample size. To the extent practicable, the
methodology used in preparing the assessment/sales ratio study
must be consistent with the most recent Standard on Assessment
Sales Ratio Studies published by the assessment standards
committee of the International Association of Assessing
Officers. The board may determine the geographic area used in
preparing the study to accurately equalize values. A sales
ratio study separating residential property into market value
categories may not be used as the basis for a petition under
chapter 278.
The sales prices used in the study must be discounted for
terms of financing. The board shall use the median ratio as the
statistical measure of the level of assessment for any
particular category of property; and
(9) The board shall receive from each county the estimated
market values on the assessment date falling within the study
period for all parcels by magnetic tape or other medium as
prescribed by the commissioner of revenue.
Sec. 8. Minnesota Statutes 1990, section 271.04, is
amended to read:
271.04 [HEARINGS.]
Subdivision 1. [GENERALLY.] The tax court shall hold
hearings and meetings as may be prescribed by the rules of the
tax court. The principal office of the tax court shall be in
Saint Paul, but it shall hold hearings at any other place within
the state, so that taxpayers may appear before the court with as
little inconvenience and expense to the taxpayer as is
practicable. The tax court shall be allowed to use the district
court court room in all of the counties. The administrator of
the tax court shall consult with the court administrator of the
district court involved before a schedule of court room to be
used by the tax court is established. Each tax court judge may
hear and decide cases. Upon petition by a party to a case, or
upon a motion by a tax court judge, and approval by a majority
of the tax court, a case may be tried before the entire tax
court. When an appeal is taken by a resident taxpayer from an
order of the commissioner, not involving property taxes, venue
for the case shall be, at the election of the taxpayer, in
Ramsey county or in the district court judicial district in
which the taxpayer resides. Venue shall be in Ramsey county for
an appeal taken by a nonresident taxpayer from an order of the
commissioner. Venue for all other cases arising under the tax
laws of the state shall be in the same judicial district as if
the case was being tried in district court.
Subd. 2. [EXCLUSION OF CERTAIN EVIDENCE.] Information,
including income and expense figures, verified net rentable
areas, and anticipated income and expenses, for income-producing
property which is not provided to the county assessor at least
30 days before any hearing under this chapter, is not admissible
except if necessary to prevent undue hardship or when the
failure to provide it was due to the unavailability of the
evidence at that time.
Sec. 9. Minnesota Statutes 1990, section 271.21,
subdivision 6, is amended to read:
Subd. 6. (a) The hearing in the small claims division
shall be informal and without a jury. The judge may hear any
testimony and receive any evidence the judge deems necessary or
desirable for a just determination of the case except as
provided in paragraph (b). Sales ratio studies published by the
department of revenue may be admissible as a public record
without foundation. All testimony shall be given under oath. A
party may appear personally or may be represented or accompanied
by an attorney. No transcript of the proceedings shall be kept.
(b) Information, including income and expense figures,
verified net rentable areas, and anticipated income and
expenses, for income-producing property which is not provided to
the county assessor at least 30 days before any hearing under
this chapter, is not admissible except if necessary to prevent
undue hardship or when the failure to provide it was due to the
unavailability of the evidence at that time.
Sec. 10. Minnesota Statutes 1990, section 272.02,
subdivision 1, is amended to read:
Subdivision 1. All property described in this section to
the extent herein limited shall be exempt from taxation:
(1) all public burying grounds;
(2) all public schoolhouses;
(3) all public hospitals;
(4) all academies, colleges, and universities, and all
seminaries of learning;
(5) all churches, church property, and houses of worship;
(6) institutions of purely public charity except parcels of
property containing structures and the structures described in
section 273.13, subdivision 25, paragraph (c), clauses (1), (2),
and (3), or paragraph (d);
(7) all public property exclusively used for any public
purpose;
(8) except for the taxable personal property enumerated
below, all personal property and the property described in
section 272.03, subdivision 1, paragraphs (c) and (d), shall be
exempt.
The following personal property shall be taxable:
(a) personal property which is part of an electric
generating, transmission, or distribution system or a pipeline
system transporting or distributing water, gas, crude oil, or
petroleum products or mains and pipes used in the distribution
of steam or hot or chilled water for heating or cooling
buildings and structures;
(b) railroad docks and wharves which are part of the
operating property of a railroad company as defined in section
270.80;
(c) personal property defined in section 272.03,
subdivision 2, clause (3);
(d) leasehold or other personal property interests which
are taxed pursuant to section 272.01, subdivision 2; 273.124,
subdivision 7; or 273.19, subdivision 1; or any other law
providing the property is taxable as if the lessee or user were
the fee owner;
(e) manufactured homes and sectional structures; and
(f) flight property as defined in section 270.071.
(9) Personal property used primarily for the abatement and
control of air, water, or land pollution to the extent that it
is so used, and real property which is used primarily for
abatement and control of air, water, or land pollution as part
of an agricultural operation, as a part of a centralized
treatment and recovery facility operating under a permit issued
by the Minnesota pollution control agency pursuant to chapters
115 and 116 and Minnesota Rules, parts 7001.0500 to 7001.0730,
and 7045.0020 to 7045.1260, as a wastewater treatment facility
and for the treatment, recovery, and stabilization of metals,
oils, chemicals, water, sludges, or inorganic materials from
hazardous industrial wastes, or as part of an electric
generation system. For purposes of this clause, personal
property includes ponderous machinery and equipment used in a
business or production activity that at common law is considered
real property.
Any taxpayer requesting exemption of all or a portion of
any real property or any equipment or device, or part thereof,
operated primarily for the control or abatement of air or water
pollution shall file an application with the commissioner of
revenue. The equipment or device shall meet standards, rules,
or criteria prescribed by the Minnesota pollution control
agency, and must be installed or operated in accordance with a
permit or order issued by that agency. The Minnesota pollution
control agency shall upon request of the commissioner furnish
information or advice to the commissioner. On determining that
property qualifies for exemption, the commissioner shall issue
an order exempting the property from taxation. The equipment or
device shall continue to be exempt from taxation as long as the
permit issued by the Minnesota pollution control agency remains
in effect.
(10) Wetlands. For purposes of this subdivision,
"wetlands" means (1) land described in section 103G.005,
subdivision 18, or (2) land which is mostly under water,
produces little if any income, and has no use except for
wildlife or water conservation purposes, provided it is
preserved in its natural condition and drainage of it would be
legal, feasible, and economically practical for the production
of livestock, dairy animals, poultry, fruit, vegetables, forage
and grains, except wild rice. "Wetlands" shall include adjacent
land which is not suitable for agricultural purposes due to the
presence of the wetlands. "Wetlands" shall not include woody
swamps containing shrubs or trees, wet meadows, meandered water,
streams, rivers, and floodplains or river bottoms. Exemption of
wetlands from taxation pursuant to this section shall not grant
the public any additional or greater right of access to the
wetlands or diminish any right of ownership to the wetlands.
(11) Native prairie. The commissioner of the department of
natural resources shall determine lands in the state which are
native prairie and shall notify the county assessor of each
county in which the lands are located. Pasture land used for
livestock grazing purposes shall not be considered native
prairie for the purposes of this clause. Upon receipt of an
application for the exemption provided in this clause for lands
for which the assessor has no determination from the
commissioner of natural resources, the assessor shall refer the
application to the commissioner of natural resources who shall
determine within 30 days whether the land is native prairie and
notify the county assessor of the decision. Exemption of native
prairie pursuant to this clause shall not grant the public any
additional or greater right of access to the native prairie or
diminish any right of ownership to it.
(12) Property used in a continuous program to provide
emergency shelter for victims of domestic abuse, provided the
organization that owns and sponsors the shelter is exempt from
federal income taxation pursuant to section 501(c)(3) of the
Internal Revenue Code of 1986, as amended through December 31,
1986, notwithstanding the fact that the sponsoring organization
receives funding under section 8 of the United States Housing
Act of 1937, as amended.
(13) If approved by the governing body of the municipality
in which the property is located, property not exceeding one
acre which is owned and operated by any senior citizen group or
association of groups that in general limits membership to
persons age 55 or older and is organized and operated
exclusively for pleasure, recreation, and other nonprofit
purposes, no part of the net earnings of which inures to the
benefit of any private shareholders; provided the property is
used primarily as a clubhouse, meeting facility, or recreational
facility by the group or association and the property is not
used for residential purposes on either a temporary or permanent
basis.
(14) To the extent provided by section 295.44, real and
personal property used or to be used primarily for the
production of hydroelectric or hydromechanical power on a site
owned by the state or a local governmental unit which is
developed and operated pursuant to the provisions of section
103G.535.
(15) If approved by the governing body of the municipality
in which the property is located, and if construction is
commenced after June 30, 1983:
(a) a "direct satellite broadcasting facility" operated by
a corporation licensed by the federal communications commission
to provide direct satellite broadcasting services using direct
broadcast satellites operating in the 12-ghz. band; and
(b) a "fixed satellite regional or national program service
facility" operated by a corporation licensed by the federal
communications commission to provide fixed satellite-transmitted
regularly scheduled broadcasting services using satellites
operating in the 6-ghz. band.
An exemption provided by clause (15) shall apply for a period
not to exceed five years. When the facility no longer qualifies
for exemption, it shall be placed on the assessment rolls as
provided in subdivision 4. Before approving a tax exemption
pursuant to this paragraph, the governing body of the
municipality shall provide an opportunity to the members of the
county board of commissioners of the county in which the
facility is proposed to be located and the members of the school
board of the school district in which the facility is proposed
to be located to meet with the governing body. The governing
body shall present to the members of those boards its estimate
of the fiscal impact of the proposed property tax exemption.
The tax exemption shall not be approved by the governing body
until the county board of commissioners has presented its
written comment on the proposal to the governing body or 30 days
has passed from the date of the transmittal by the governing
body to the board of the information on the fiscal impact,
whichever occurs first.
(16) Real and personal property owned and operated by a
private, nonprofit corporation exempt from federal income
taxation pursuant to United States Code, title 26, section
501(c)(3), primarily used in the generation and distribution of
hot water for heating buildings and structures.
(17) Notwithstanding section 273.19, state lands that are
leased from the department of natural resources under section
92.46.
(18) Electric power distribution lines and their
attachments and appurtenances, that are used primarily for
supplying electricity to farmers at retail.
(19) Transitional housing facilities. "Transitional
housing facility" means a facility that meets the following
requirements. (i) It provides temporary housing to parents and
children who are receiving AFDC or parents of children who are
temporarily in foster care. (ii) It has the purpose of
reuniting families and enabling parents to obtain
self-sufficiency, advance their education, get job training, or
become employed in jobs that provide a living wage. (iii) It
provides support services such as child care, work readiness
training, and career development counseling; and a
self-sufficiency program with periodic monitoring of each
resident's progress in completing the program's goals. (iv) It
provides services to a resident of the facility for at least six
months but no longer than three years, except residents enrolled
in an educational or vocational institution or job training
program. These residents may receive services during the time
they are enrolled but in no event longer than four years. (v)
It is sponsored by an organization that has received a grant
under either section 256.7365 for the biennium ending June 30,
1989, or section 462A.07, subdivision 15, for the biennium
ending June 30, 1991, for the purposes of providing the services
in items (i) to (iv). (vi) It is sponsored by an organization
that is exempt from federal income tax under section 501(c)(3)
of the Internal Revenue Code of 1986, as amended through
December 31, 1987. This exemption applies notwithstanding the
fact that the sponsoring organization receives financing by a
direct federal loan or federally insured loan or a loan made by
the Minnesota housing finance agency under the provisions of
either Title II of the National Housing Act or the Minnesota
housing finance agency law of 1971 or rules promulgated by the
agency pursuant to it, and notwithstanding the fact that the
sponsoring organization receives funding under Section 8 of the
United States Housing Act of 1937, as amended.
(20) Real and personal property, including leasehold or
other personal property interests, owned and operated by a
corporation if more than 50 percent of the total voting power of
the stock of the corporation is owned collectively by: (i) the
board of regents of the University of Minnesota, (ii) the
University of Minnesota Foundation, an organization exempt from
federal income taxation under section 501(c)(3) of the Internal
Revenue Code of 1986, as amended through December 31, 1990, and
(iii) a corporation organized under chapter 317A, which by its
articles of incorporation is prohibited from providing pecuniary
gain to any person or entity other than the regents of the
University of Minnesota; which property is used primarily to
manage or provide goods, services, or facilities utilizing or
relating to large-scale advanced scientific computing resources
to the regents of the University of Minnesota and others.
Sec. 11. Minnesota Statutes 1990, section 272.03,
subdivision 1, is amended to read:
Subdivision 1. [REAL PROPERTY.] (a) For the purposes of
taxation, "real property" includes the land itself, rails, ties,
and other track materials annexed to the land, and all
buildings, structures, and improvements or other fixtures on it,
bridges of bridge companies, and all rights and privileges
belonging or appertaining to the land, and all mines, iron ore
and taconite minerals not otherwise exempt, quarries, fossils,
and trees on or under it.
(b) A building or structure shall include the building or
structure itself, together with all improvements or fixtures
annexed to the building or structure, which are integrated with
and of permanent benefit to the building or structure,
regardless of the present use of the building, and which cannot
be removed without substantial damage to itself or to the
building or structure.
(c) (i) The term "Real property" shall does not include
tools, implements, machinery, and equipment attached to or
installed in real property for use in the business or production
activity conducted thereon, regardless of size, weight or method
of attachment, and mine shafts, tunnels, and other underground
openings used to extract ores and minerals taxed under chapter
298 together with steel, concrete, and other materials used to
support such openings.
(ii) The exclusion provided in clause (i) shall not apply
to machinery and equipment includable as real estate by
paragraphs (a) and (b) even though such machinery and equipment
is used in the business or production activity conducted on the
real property if and to the extent such business or production
activity consists of furnishing services or products to other
buildings or structures which are subject to taxation under this
chapter.
(iii) The exclusion provided in clause (i) does not apply
to the exterior shell of a structure which constitutes walls,
ceilings, roofs, or floors if the shell of the structure has
structural, insulation, or temperature control functions or
provides protection from the elements. Such an exterior shell
is included in the definition of real property even if it also
has special functions distinct from that of a building.
(d) The term real property does not include tools,
implements, machinery, equipment, poles, lines, cables, wires,
conduit, and station connections which are part of a telephone
communications system, regardless of attachment to or
installation in real property and regardless of size, weight, or
method of attachment or installation.
Sec. 12. Minnesota Statutes 1990, section 273.11,
subdivision 1, is amended to read:
Subdivision 1. [GENERALLY.] Except as provided in
subdivisions 6, 8, and 9 or section 273.17, subdivision 1, all
property shall be valued at its market value. The market value
as determined pursuant to this section shall be stated such that
any amount under $100 is rounded up to $100 and any amount
exceeding $100 shall be rounded to the nearest $100. In
estimating and determining such value, the assessor shall not
adopt a lower or different standard of value because the same is
to serve as a basis of taxation, nor shall the assessor adopt as
a criterion of value the price for which such property would
sell at a forced sale, or in the aggregate with all the property
in the town or district; but the assessor shall value each
article or description of property by itself, and at such sum or
price as the assessor believes the same to be fairly worth in
money. The assessor shall take into account the effect on the
market value of property of environmental factors in the
vicinity of the property. In assessing any tract or lot of real
property, the value of the land, exclusive of structures and
improvements, shall be determined, and also the value of all
structures and improvements thereon, and the aggregate value of
the property, including all structures and improvements,
excluding the value of crops growing upon cultivated land. In
valuing real property upon which there is a mine or quarry, it
shall be valued at such price as such property, including the
mine or quarry, would sell for a fair, voluntary sale, for
cash. In valuing real property which is vacant, the fact that
such property is platted shall not be taken into account. An
individual lot of such platted property shall not be assessed in
excess of the valuation of the land as if it were unplatted
until the lot is improved with a permanent improvement all or a
portion of which is located upon the lot , or for a period of
three years after final approval of said plat whichever is
shorter at its market value beginning with the first assessment
following final approval of the plat. When a lot is sold or
construction begun, that lot or any single contiguous lot
fronting on the same streetshall be eligible for revaluation.
All property, or the use thereof, which is taxable under section
272.01, subdivision 2, or 273.19, shall be valued at the market
value of such property and not at the value of a leasehold
estate in such property, or at some lesser value than its market
value.
Sec. 13. Minnesota Statutes 1990, section 273.112,
subdivision 7, is amended to read:
Subd. 7. When real property which is being, or has been,
valued and assessed under this section no longer qualifies under
subdivision 3, the portion which no longer qualifies shall be
subject to additional taxes, in the amount equal to the
difference between the taxes determined in accordance with
subdivision 4, and the amount determined under subdivision 5,
provided, however, that the amount determined under subdivision
5 shall not be greater than it would have been had the actual
bona fide sale price of the real property at an arms length
transaction been used in lieu of the market value determined
under subdivision 5. The additional taxes shall be extended
against the property on the tax list for the current year,
provided, however, that no interest or penalties shall be levied
on the additional taxes if timely paid, and provided further,
that the additional taxes shall only be levied with respect to
the last seven years that the property has been valued and
assessed under this section. This subdivision does not apply to
real property that ceases to qualify under subdivision 3 because
it is acquired by the state of Minnesota or a political
subdivision, agency, or instrumentality of the state, provided
that the property continues to be used for a qualifying purpose
for at least five years from the date that the property was
acquired.
Sec. 14. Minnesota Statutes 1990, section 273.12, is
amended to read:
273.12 [ASSESSMENT OF REAL PROPERTY.]
It shall be the duty of every assessor and board, in
estimating and determining the value of lands for the purpose of
taxation, to consider and give due weight to every element and
factor affecting the market value thereof, including its
location with reference to roads and streets and the location of
roads and streets thereon or over the same, and to take into
consideration a reduction in the acreage of each tract or lot
sufficient to cover the amount of land actually used for any
improved public highway and the reduction in area of land caused
thereby, provided, that in determining the market value of
vacant land, the fact that such land is platted shall not be
taken into account. An individual lot of such platted property
shall not be assessed in excess of the assessment of the land as
if it were unplatted until the lot is improved with a permanent
improvement all or a portion of which is located upon the lot,
or for a period of three years after final approval of said plat
whichever is shorter. When a lot is sold or construction begun,
the net tax capacity of that lot or any single contiguous lot
fronting on the same street shall be eligible for reassessment.
It shall be the duty of every assessor and board, in estimating
and determining the value of lands for the purpose of taxation,
to consider and give due weight to lands which are comparable in
character, quality, and location, to the end that all lands
similarly located and improved will be assessed upon a uniform
basis and without discrimination and, for agricultural lands, to
consider and give recognition to its earning potential as
measured by its free market rental rate.
Notwithstanding the provisions of this or any other
section, no additional value shall be assessed for unmined
mineral value except for iron ore or taconite.
Sec. 15. Minnesota Statutes 1990, section 273.124,
subdivision 1, is amended to read:
Subdivision 1. [GENERAL RULE.] (a) Residential real estate
that is occupied and used for the purposes of a homestead by its
owner, who must be a Minnesota resident, is a residential
homestead.
Agricultural land, as defined in section 273.13,
subdivision 23, that is occupied and used as a homestead by its
owner, who must be a Minnesota resident, is an agricultural
homestead.
Dates for establishment of a homestead and homestead
treatment provided to particular types of property are as
provided in this section.
The assessor shall require proof, by affidavit or
otherwise, of the facts upon which classification as a homestead
may be determined.
(b) For purposes of this section, homestead property shall
include property which is used for purposes of the homestead but
is separated from the homestead by a road, street, lot,
waterway, or other similar intervening property. The term "used
for purposes of the homestead" shall include but not be limited
to uses for gardens, garages, or other outbuildings commonly
associated with a homestead, but shall not include vacant land
held primarily for future development. In order to receive
homestead treatment for the noncontiguous property, the owner
shall apply for it to the assessor by July 1 of the year when
the treatment is initially sought. After initial qualification
for the homestead treatment, additional applications for
subsequent years are not required.
(c) In the case of property owned by a married couple in
joint tenancy or tenancy in common, the assessor must not deny
homestead treatment in whole or in part if only one of the
spouses is occupying the property and the other spouse is absent
due to divorce or separation, or is a resident of a nursing home
or a boarding care facility.
(d) If an individual is purchasing property with the intent
of claiming it as a homestead, and is required by the terms of
the financing agreement to have one or both parents a relative
shown on the deed as coowners a coowner, the assessor shall
allow a full homestead classification and extend full homestead
credit. This provision only applies to first time purchasers,
whether married or single, or to a person who had previously
been married and is purchasing as a single individual for the
first time. The application for homestead benefits must be on a
form prescribed by the commissioner and must contain the data
necessary for the assessor to determine if full homestead
benefits are warranted. For purposes of this paragraph,
"relative" means a parent, stepparent, child, stepchild,
grandparent, brother, sister, uncle, or aunt. This relationship
may be by blood or marriage.
(e) In the case of property owned and formerly occupied by
two or more persons in joint tenancy or tenancy in common, when
those persons are related to each other as parents and children
or as stepparents and stepchildren, and when one or more of the
owners ceases to occupy the property, the assessor shall
continue to allow a full homestead classification as long as at
least one of the owners continues to occupy the property for
purposes of a homestead. This paragraph applies only to single
family residential property.
Sec. 16. Minnesota Statutes 1990, section 273.124,
subdivision 6, is amended to read:
Subd. 6. [LEASEHOLD COOPERATIVES.] When one or more
dwellings or one or more buildings which each contain several
dwelling units is owned by a nonprofit corporation subject to
the provisions of chapter 317A and qualifying under section
501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986, as
amended through December 31, 1988 1990, or a limited partnership
which corporation or partnership operates the property in
conjunction with a cooperative association, and has received
public financing, homestead treatment may be claimed by the
cooperative association on behalf of the members of the
cooperative for each dwelling unit occupied by a member of the
cooperative. The cooperative association must provide the
assessor with the social security numbers of those members. To
qualify for the treatment provided by this subdivision, the
following conditions must be met:
(a) the cooperative association must be organized under
chapter 308A and all voting members of the board of directors
must be resident tenants of the cooperative and must be elected
by the resident tenants of the cooperative;
(b) the cooperative association must have a lease for
occupancy of the property for a term of at least 20 years, which
permits the cooperative association, while not in default on the
lease, to participate materially in the management of the
property, including material participation in establishing
budgets, setting rent levels, and hiring and supervising a
management agent;
(c) to the extent permitted under state or federal law, the
cooperative association must have a right under a written
agreement with the owner to purchase the property if the owner
proposes to sell it; if the cooperative association does not
purchase the property it is offered for sale, the owner may not
subsequently sell the property to another purchaser at a price
lower than the price at which it was offered for sale to the
cooperative association unless the cooperative association
approves the sale;
(d) the cooperative must meet one of the following criteria
with respect to the income of its members: (1) a minimum of 75
percent of members must have incomes at or less than 80 percent
of area median income, (2) a minimum of 40 percent of members
must have incomes at or less than 60 percent of area median
income, or (3) a minimum of 20 percent of members must have
incomes at or less than 50 percent of area median income. For
purposes of this clause, "member income" means the income of a
member existing at the time the member acquires his or her
cooperative membership, and "median income" means the St.
Paul-Minneapolis metropolitan area median income as determined
by the United States Department of Housing and Urban
Development;
(e) if a limited partnership owns the property, it must
include as the managing general partner a nonprofit organization
operating under the provisions of chapter 317A and qualifying
under section 501(c)(3) or 501(c)(4) of the Internal Revenue
Code of 1986, as amended through December 31, 1988 1990, and the
limited partnership agreement must provide that the managing
general partner have sufficient powers so that it materially
participates in the management and control of the limited
partnership;
(f) prior to becoming a member of a leasehold cooperative
described in this subdivision, a person must have received
notice that (1) describes leasehold cooperative property in
plain language, including but not limited to the effects of
classification under this subdivision on rents, property taxes
and tax credits or refunds, and operating expenses, and (2)
states that copies of the articles of incorporation and bylaws
of the cooperative association, the lease between the owner and
the cooperative association, a sample sublease between the
cooperative association and a tenant, and, if the owner is a
partnership, a copy of the limited partnership agreement, can be
obtained upon written request at no charge from the owner, and
the owner must send or deliver the materials within seven days
after receiving any request;
(g) if a dwelling unit of a building was occupied on the
60th day prior to the date on which the unit became leasehold
cooperative property described in this subdivision, the notice
described in paragraph (f) must have been sent by first class
mail to the occupant of the unit at least 60 days prior to the
date on which the unit became leasehold cooperative property.
For purposes of the notice under this paragraph, the copies of
the documents referred to in paragraph (f) may be in proposed
version, provided that any subsequent material alteration of
those documents made after the occupant has requested a copy
shall be disclosed to any occupant who has requested a copy of
the document. Copies of the articles of incorporation and
certificate of limited partnership shall be filed with the
secretary of state after the expiration of the 60-day period
unless the change to leasehold cooperative status does not
proceed; and
(h) the county attorney of the county in which the property
is located must certify to the assessor that the property meets
the requirements of this subdivision.
Homestead treatment must be afforded to units occupied by
members of the cooperative association and the units must be
assessed as provided in subdivision 3, provided that any unit
not so occupied shall be classified and assessed pursuant to the
appropriate class. No more than three acres of land may, for
assessment purposes, be included with each dwelling unit that
qualifies for homestead treatment under this subdivision.
Sec. 17. Minnesota Statutes 1990, section 273.124,
subdivision 9, is amended to read:
Subd. 9. [HOMESTEAD ESTABLISHED AFTER ASSESSMENT DATE.]
Any property that was not used for the purpose of a homestead on
the assessment date, but which was used for the purpose of a
homestead by June 1 of a year, constitutes class 1 or class 2a.
Any taxpayer meeting the requirements of this subdivision
must notify the county assessor, or the assessor who has the
powers of the county assessor pursuant to section 273.063, in
writing, prior to June 15 of the year of occupancy in order to
qualify under this subdivision. The assessor must not deny full
homestead treatment to a property that is partially homesteaded
on January 2 but occupied for the purpose of a full homestead by
June 1 of a year.
The county assessor and the county auditor may make the
necessary changes on their assessment and tax records to provide
for proper homestead classification as provided in this
subdivision.
The owner of any property qualifying under this
subdivision, which has not been accorded the benefits of this
subdivision, regardless of whether or not the notification has
been timely filed, may be entitled to receive homestead
classification by proper application as provided in section
270.07 or 375.192.
The county assessor shall publish in a newspaper of general
circulation within the county no later than June 1 of each year
a notice informing the public of the requirement to file an
application for homestead prior to June 15.
Sec. 18. Minnesota Statutes 1990, section 273.124,
subdivision 14, is amended to read:
Subd. 14. [AGRICULTURAL HOMESTEADS; SPECIAL PROVISIONS.]
(a) Real estate of less than ten acres that is the homestead of
its owner must be classified as class 2a under section 273.13,
subdivision 23, paragraph (a), if:
(1) the parcel on which the house is located is contiguous
to agricultural land on at least two sides to (i) agricultural
land, (ii) land owned or administered by the United States Fish
and Wildlife Service, or (iii) land administered by the
department of natural resources on which in lieu taxes are paid
under sections 477A.11 to 477A.14;
(2) its owner also owns a noncontiguous parcel of
agricultural land that is at least 20 acres;
(3) the noncontiguous land is located not farther than two
townships or cities, or a combination of townships or cities
from the homestead; and
(4) the agricultural use value of the noncontiguous land
and farm buildings is equal to at least 50 percent of the market
value of the house, garage, and one acre of land.
Homesteads initially classified as class 2a under the
provisions of this subdivision shall remain classified as class
2a, irrespective of subsequent changes in the use of adjoining
properties, as long as the homestead remains under the same
ownership, the owner owns a noncontiguous parcel of agricultural
land that is at least 20 acres, and the agricultural use value
qualifies under clause (4).
(b) Noncontiguous land shall be included as part of a
homestead under section 273.13, subdivision 23, paragraph (a),
only if the homestead is classified as class 2a and the detached
land is located in the same township or city, or not farther
than two townships or cities or combination thereof from the
homestead.
(c) Agricultural land used for purposes of a homestead and
actively farmed by a person holding a vested remainder interest
in it must be classified as a homestead under section 273.13,
subdivision 23, paragraph (a). If agricultural land is
classified class 2a, any other dwellings on the land used for
purposes of a homestead by persons holding vested remainder
interests who are actively engaged in farming the property, and
up to one acre of the land surrounding each homestead and
reasonably necessary for the use of the dwelling as a home, must
also be assessed class 2a.
Sec. 19. Minnesota Statutes 1990, section 273.124,
subdivision 15, is amended to read:
Subd. 15. [RESIDENCE OF DISABLED CHILD, PARENT, OR SIBLING
OF OWNER.] The principal residence of an individual who has a
permanent disability as defined in section 290A.03, subdivision
10, shall be classified as a homestead if the residence is
wholly owned by a parent or both parents of the individual, by a
child or children of the individual, or by a sibling or siblings
of the individual. This subdivision does not apply to a
residence owned by a child of a disabled parent if the property
had been the homestead of the parent or parents of the child
immediately prior to its acquisition by the child until the
first levy year beginning three years after the date of
acquisition. The application for homestead benefits must be on
a form prescribed by the commissioner and must contain the
information necessary for the assessor to determine whether
homestead classification under this subdivision is warranted.
Sec. 20. Minnesota Statutes 1990, section 273.13,
subdivision 22, is amended to read:
Subd. 22. [CLASS 1.] (a) Except as provided in subdivision
23, real estate which is residential and used for homestead
purposes is class 1. The market value of class 1a property must
be determined based upon the value of the house, garage, and
land.
The first $68,000 $72,000 of market value of class 1a
property has a net class rate of one percent of its market value
and a gross class rate of 2.17 percent of its market value. For
taxes payable in 1992, the market value of class 1a property
that exceeds $68,000 $72,000 but does not exceed
$110,000 $115,000 has a class rate of two percent of its market
value.; and the market value of class 1a property that
exceeds $110,000 $115,000 has a class rate of three 2.5 percent
of its market value. For taxes payable in 1993 and thereafter,
the market value of class 1a property that exceeds $72,000 has a
class rate of two percent.
(b) Class 1b property includes real estate or manufactured
homes used for the purposes of a homestead by
(1) any blind person, if the blind person is the owner
thereof or if the blind person and the blind person's spouse are
the sole owners thereof; or
(2) any person, hereinafter referred to as "veteran," who:
(i) served in the active military or naval service of the
United States; and
(ii) is entitled to compensation under the laws and
regulations of the United States for permanent and total
service-connected disability due to the loss, or loss of use, by
reason of amputation, ankylosis, progressive muscular
dystrophies, or paralysis, of both lower extremities, such as to
preclude motion without the aid of braces, crutches, canes, or a
wheelchair; and
(iii) with assistance by the administration of veterans
affairs has acquired a special housing unit with special
fixtures or movable facilities made necessary by the nature of
the veteran's disability, or the surviving spouse of the
deceased veteran for as long as the surviving spouse retains the
special housing unit as a homestead; or
(3) any person who:
(i) is permanently and totally disabled and
(ii) receives 90 percent or more of total income from
(A) aid from any state as a result of that disability; or
(B) supplemental security income for the disabled; or
(C) workers' compensation based on a finding of total and
permanent disability; or
(D) social security disability, including the amount of a
disability insurance benefit which is converted to an old age
insurance benefit and any subsequent cost of living increases;
or
(E) aid under the Federal Railroad Retirement Act of 1937,
United States Code Annotated, title 45, section 228b(a)5; or
(F) a pension from any local government retirement fund
located in the state of Minnesota as a result of that
disability; or
(iii) (4) any person who is permanently and totally
disabled and whose household income as defined in section
290A.03, subdivision 5, is 150 percent or less of the federal
poverty level.
Property is classified and assessed under clause (4) only
if the government agency or income-providing source certifies,
upon the request of the property owner, that the property owner
satisfies the disability requirements of this subdivision.
Property is classified and assessed pursuant to clause (1)
only if the commissioner of jobs and training certifies to the
assessor that the owner of the property satisfies the
requirements of this subdivision.
Permanently and totally disabled for the purpose of this
subdivision means a condition which is permanent in nature and
totally incapacitates the person from working at an occupation
which brings the person an income. The first $32,000 market
value of class 1b property has a net class rate of .45 percent
of its market value and a gross class rate of .87 percent of its
market value. The remaining market value of class 1b property
has a gross or net class rate using the rates for class 1 or
class 2a property, whichever is appropriate, of similar market
value.
(c) Class 1c property is commercial use real property that
abuts a lakeshore line and is devoted to temporary and seasonal
residential occupancy for recreational purposes but not devoted
to commercial purposes for more than 225 days in the year
preceding the year of assessment, and that includes a portion
used as a homestead by the owner, which includes a dwelling
occupied as a homestead by a shareholder of a corporation that
owns the resort or a partner in a partnership that owns the
resort, even if the title to the homestead is held by the
corporation or partnership. For purposes of this clause,
property is devoted to a commercial purpose on a specific day if
any portion of the property, excluding the portion used
exclusively as a homestead, is used or available for use for
residential occupancy and a fee is charged for residential
occupancy. Class 1c property has a class rate of .4 percent of
the first $32,000 of market value for taxes payable in 1990, .6
percent of the first $32,000 of market value for taxes payable
in 1991, .8 percent of the first $32,000 of market value for
taxes payable in 1992, and one percent of market value in excess
of $32,000 for taxes payable in 1990, 1991, and 1992, and one
percent of total market value for taxes payable in 1993 and
thereafter with the following limitation: the area of the
property must not exceed 100 feet of lakeshore footage for each
cabin or campsite located on the property up to a total of 800
feet and 500 feet in depth, measured away from the lakeshore.
Sec. 21. Minnesota Statutes 1990, section 273.13,
subdivision 23, is amended to read:
Subd. 23. [CLASS 2.] (a) Class 2a property is agricultural
land including any improvements that is homesteaded. The market
value of the house and garage and immediately surrounding one
acre of land has the same class rates as class 1a property under
subdivision 22. If the market value of the house, garage, and
surrounding one acre of land is less than $110,000 $115,000, the
value of the remaining land including improvements equal to the
difference between $110,000 $115,000 and the market value of the
house, garage, and surrounding one acre of land has a net class
rate of .45 percent of market value and a gross class rate of
1.75 percent of market value. The remaining value of class 2a
property over $110,000 $115,000 of market value that does not
exceed 320 acres has a net class rate of 1.3 percent of market
value for taxes payable in 1990 and thereafter, and a gross
class rate of 2.25 percent of market value. The remaining
property over the $110,000 $115,000 market value in excess of
320 acres has a class rate of 1.7 percent of market value for
taxes payable in 1990, and 1.6 percent of market value for taxes
payable in 1991, and thereafter, and a gross class rate of 2.25
percent of market value.
(b) Class 2b property is (1) real estate, rural in
character and used exclusively for growing trees for timber,
lumber, and wood and wood products; and (2) real estate that is
nonhomestead agricultural land. Class 2b property has a net
class rate of 1.7 percent of market value for taxes payable in
1990, and 1.6 percent of market value for taxes payable in 1991,
and thereafter, and a gross class rate of 2.25 percent of market
value.
(c) Agricultural land as used in this section means
contiguous acreage of ten acres or more, primarily used during
the preceding year for agricultural purposes. Agricultural use
may include pasture, timber, waste, unusable wild land, and land
included in state or federal farm programs. "Agricultural
purposes" as used in this section means the raising or
cultivation of agricultural products, and includes the
commercial boarding of horses if the commercial boarding of
horses is done in conjunction with the raising or cultivation of
agricultural products.
(d) Real estate of less than ten acres used principally for
raising poultry, livestock, fruit, vegetables or other
agricultural products, including the breeding of fish for sale
and consumption if the fish breeding occurs on land zoned for or
cultivating agricultural use products, shall be considered as
agricultural land, if it is not used primarily for residential
purposes.
(e) The term "agricultural products" as used in the
preceding sentence means any of the products identified in
section 273.111, this subdivision 6, clause (2) includes:
(1) livestock, dairy animals, dairy products, poultry and
poultry products, fur-bearing animals, horticultural and nursery
stock described in sections 18.44 to 18.61, fruit of all kinds,
vegetables, forage, grains, bees, and apiary products by the
owner;
(2) fish bred for sale and consumption if the fish breeding
occurs on land zoned for agricultural use;
(3) the commercial boarding of horses if the boarding is
done in conjunction with raising or cultivating agricultural
products as defined in clause (1); and
(4) property which is owned and operated by nonprofit
organizations used for equestrian activities, excluding racing.
(e) (f) If a parcel used for agricultural purposes is also
used for commercial or industrial purposes, including but not
limited to:
(1) wholesale and retail sales;
(2) processing of raw agricultural products or other goods;
(3) warehousing or storage of processed goods; and
(4) office facilities for the support of the activities
enumerated in clauses (1), (2), and (3),
the assessor shall classify the part of the parcel used for
agricultural purposes as class 1b, 2a, or 2b, whichever is
appropriate, and the remainder in the class appropriate to its
use. The grading, sorting, and packaging of raw agricultural
products for first sale is considered an agricultural purpose.
A greenhouse or other building where horticultural or nursery
products are grown that is also used for the conduct of retail
sales must be classified as agricultural if it is primarily used
for the growing of horticultural or nursery products from seed,
cuttings, or roots and occasionally as a showroom for the retail
sale of those products. Use of a greenhouse or building only
for the display of already grown horticultural or nursery
products does not qualify as an agricultural purpose.
The assessor shall determine and list separately on the
records the market value of the homestead dwelling and the one
acre of land on which that dwelling is located. If any farm
buildings or structures are located on this homesteaded acre of
land, their market value shall not be included in this separate
determination.
Sec. 22. Minnesota Statutes 1990, section 273.13,
subdivision 25, is amended to read:
Subd. 25. [CLASS 4.] (a) Class 4a is residential real
estate containing four or more units and used or held for use by
the owner or by the tenants or lessees of the owner as a
residence for rental periods of 30 days or more. Class 4a also
includes hospitals licensed under sections 144.50 to 144.56,
other than hospitals exempt under section 272.02, and contiguous
property used for hospital purposes, without regard to whether
the property has been platted or subdivided. Class 4a property
has a class rate of 3.6 3.5 percent of market value for taxes
payable in 1992, and 3.4 percent of market value for taxes
payable in 1993 and thereafter.
(b) Class 4b includes:
(1) residential real estate containing less than four
units, other than seasonal residential, and recreational;
(2) manufactured homes not classified under any other
provision;
(3) a dwelling, garage, and surrounding one acre of
property on a nonhomestead farm classified under subdivision 23,
paragraph (b).
Class 4b property has a class rate of 3.0 2.8 percent of
market value for taxes payable in 1992, 2.5 percent of market
value for taxes payable in 1993, and 2.3 percent of market value
for taxes payable in 1994 and thereafter.
(c) Class 4c property includes:
(1) a structure that is situated on real property that is
used for housing for the elderly or for low and moderate income
families as defined by Title II of the National Housing Act or
the Minnesota housing finance agency law of 1971 or rules
promulgated by the agency pursuant thereto and financed by a
direct federal loan or federally insured loan or a loan made by
the Minnesota housing finance agency pursuant to the provisions
of either of those acts and acts amendatory thereof. This
clause applies only to property of a nonprofit or limited
dividend entity. Property is classified as class 4c under this
clause for 15 years from the date of the completion of the
original construction or substantial rehabilitation, or for the
original term of the loan;:
(i) situated on real property that is used for housing for
the elderly or for low- and moderate-income families as defined
in Title II, as amended through December 31, 1990, of the
National Housing Act and financed by a direct federal loan or
federally insured loan made pursuant to Title II of the act; or
(ii) situated on real property that is used for housing the
elderly or for low- and moderate-income families as defined by
the Minnesota housing finance agency law of 1971, as amended, or
rules adopted by the agency pursuant thereto and financed by a
loan made by the Minnesota housing finance agency pursuant to
the provisions of the act.
This clause applies only to property of a nonprofit or
limited dividend entity. Property is classified as class 4c
under this clause for 15 years from the date of the completion
of the original construction or substantial rehabilitation, or
for the original term of the loan.
(2) a structure that is:
(i) situated upon real property that is used for housing
lower income families or elderly or handicapped persons, as
defined in section 8 of the United States Housing Act of 1937,
as amended; and
(ii) owned by an entity which has entered into a housing
assistance payments contract under section 8 which provides
assistance for 100 percent of the dwelling units in the
structure, other than dwelling units intended for management or
maintenance personnel. Property is classified as class 4c under
this clause for the term of the housing assistance payments
contract, including all renewals, or for the term of its
permanent financing, whichever is shorter; and
(3) a qualified low-income building as defined in section
42(c)(2) of the Internal Revenue Code of 1986, as amended
through December 31, 1990, that (i) receives a low-income
housing credit under section 42 of the Internal Revenue Code of
1986, as amended through December 31, 1988 1990; or (ii) meets
the requirements of that section and receives public financing,
except financing provided under sections 469.174 to 469.179,
which contains terms restricting the rents; or (iii) meets the
requirements of section 273.1317. Classification pursuant to
this clause is limited to a term of 15 years.
For all properties described in clauses (1), (2), and (3)
and in paragraph (d), the market value determined by the
assessor must be based on the normal approach to value using
normal unrestricted rents unless the owner of the property
elects to have the property assessed under section 55. If the
owner of the property elects to have the market value determined
on the basis of the actual restricted rents, as provided in
section 55 the property will be assessed at the rate provided
for class 4a or class 4b property, as appropriate. Properties
described in clauses (1)(ii), (3), and (4) may apply to the
assessor for valuation under section 55. The land on which
these structures are situated has the class rate given in
paragraph (b) if the structure contains fewer than four units,
and the class rate given in paragraph (a) if the structure
contains four or more units. This clause applies only to the
property of a nonprofit or limited dividend entity.
(4) a parcel of land, not to exceed one acre, and its
improvements or a parcel of unimproved land, not to exceed one
acre, if it is owned by a neighborhood real estate trust and at
least 60 percent of the dwelling units, if any, on all land
owned by the trust are leased to or occupied by lower income
families or individuals. This clause does not apply to any
portion of the land or improvements used for nonresidential
purposes. For purposes of this clause, a lower income family is
a family with an income that does not exceed 65 percent of the
median family income for the area, and a lower income individual
is an individual whose income does not exceed 65 percent of the
median individual income for the area, as determined by the
United States Secretary of Housing and Urban Development. For
purposes of this clause, "neighborhood real estate trust" means
an entity which is certified by the governing body of the
municipality in which it is located to have the following
characteristics: (a) it is a nonprofit corporation organized
under chapter 317A; (b) it has as its principal purpose
providing housing for lower income families in a specific
geographic community designated in its articles or bylaws; (c)
it limits membership with voting rights to residents of the
designated community; and (d) it has a board of directors
consisting of at least seven directors, 60 percent of whom are
members with voting rights and, to the extent feasible, 25
percent of whom are elected by resident members of buildings
owned by the trust; and
(5) except as provided in subdivision 22, paragraph (c),
real property devoted to temporary and seasonal residential
occupancy for recreation purposes, including real property
devoted to temporary and seasonal residential occupancy for
recreation purposes and not devoted to commercial purposes for
more than 225 250 days in the year preceding the year of
assessment. For purposes of this clause, property is devoted to
a commercial purpose on a specific day if any portion of the
property is used, or available for use for residential
occupancy, and a fee is charged for residential occupancy.
Class 4c also includes commercial use real property used
exclusively for recreational purposes in conjunction with class
4c property devoted to temporary and seasonal residential
occupancy for recreational purposes, up to a total of two acres,
provided the property is not devoted to commercial recreational
use for more than 225 250 days in the year preceding the year of
assessment and is located within two miles of the class 4c
property with which it is used. Class 4c property classified in
this clause also includes the remainder of class 1c resorts;
(6) real property up to a maximum of one acre of land owned
by a nonprofit community service oriented organization; provided
that the property is not used for a revenue-producing activity
for more than six days in the calendar year preceding the year
of assessment and the property is not used for residential
purposes on either a temporary or permanent basis. For purposes
of this clause, a "nonprofit community service oriented
organization" means any corporation, society, association,
foundation, or institution organized and operated exclusively
for charitable, religious, fraternal, civic, or educational
purposes, and which is exempt from federal income taxation
pursuant to section 501(c)(3), (10), or (19) of the Internal
Revenue Code of 1986, as amended through December 31, 1988 1990.
For purposes of this clause, "revenue-producing activities"
shall include but not be limited to property or that portion of
the property that is used as an on-sale intoxicating liquor or
nonintoxicating malt liquor establishment licensed under chapter
340A, a restaurant open to the public, bowling alley, a retail
store, gambling conducted by organizations licensed under
chapter 349, an insurance business, or office or other space
leased or rented to a lessee who conducts a for-profit
enterprise on the premises. Any portion of the property which
is used for revenue-producing activities for more than six days
in the calendar year preceding the year of assessment shall be
assessed as class 3a. The use of the property for social events
open exclusively to members and their guests for periods of less
than 24 hours, when an admission is not charged nor any revenues
are received by the organization shall not be considered a
revenue-producing activity;
(7) post-secondary student housing of not more than one
acre of land that is owned by a nonprofit corporation organized
under chapter 317A and is used exclusively by a student
cooperative, sorority, or fraternity for on-campus housing or
housing located within two miles of the border of a college
campus; and
(8) manufactured home parks as defined in section 327.14,
subdivision 3.
Class 4c property has a class rate of 2.3 percent of market
value, except that manufactured home park seasonal residential
recreational property not used for commercial purposes under
clause (8) (5) has a class rate of 3 2.2 percent of market value
for taxes payable in 1991 and 2.3 percent of market value 1992,
and for taxes payable in 1992, 1993 and thereafter, the first
$72,000 of market value has a class rate of two percent and the
market value that exceeds $72,000 has a class rate of 2.5
percent.
(d) Class 4d property includes:
(1) any a structure: that is:
(i) situated on real property that is used for housing for
the elderly or for low and moderate income families as defined
by the Farmers Home Administration;
(ii) located in a municipality of less than 10,000
population; and
(iii) financed by a direct loan or insured loan from the
Farmers Home Administration. Property is classified under this
clause for 15 years from the date of the completion of the
original construction or for the original term of the loan.
The class rates in paragraph (c), clauses (1), (2), and (3)
and this clause apply to the properties described in them, only
in proportion to occupancy of the structure by elderly or
handicapped persons or low and moderate income families as
defined in the applicable laws unless construction of the
structure had been commenced prior to January 1, 1984; or the
project had been approved by the governing body of the
municipality in which it is located prior to June 30, 1983; or
financing of the project had been approved by a federal or state
agency prior to June 30, 1983. Classification under this clause
is only available to property of a nonprofit or limited dividend
entity.
(2) For taxes payable in 1992, 1993 and 1994, only,
buildings and appurtenances, together with the land upon which
they are located, leased by the occupant under the community
lending model lease-purchase mortgage loan program administered
by the Federal National Mortgage Association, provided the
occupant's income is no greater than 60 percent of the county or
area median income, adjusted for family size and the building
consists of existing single family or duplex housing. The lease
agreement must provide for a portion of the lease payment to be
escrowed as a nonrefundable down payment on the housing. To
qualify under this clause, the taxpayer must apply to the county
assessor by May 30 of each year. The application must be
accompanied by an affidavit or other proof required by the
assessor to determine qualification under this clause.
(3) For taxes payable in 1992, 1993 and 1994, only,
federally acquired buildings under four units and appurtenances,
together with the land upon which they are located that is
leased to a nonprofit corporation organized under chapter 317A
that qualifies for tax exempt status under United States Code,
title 26, section 501(c), or a housing and redevelopment
authority authorized under sections 469.001 to 469.047; the
purpose of the lease must be to allow the nonprofit corporation
to provide transitional housing for homeless persons under the
program established in Code of Federal Regulations, title 55,
section 49489. As used in this clause, "transitional housing"
has the meaning given in section 268.38, subdivision 1, except
that the two-year restriction does not apply. If the property
is purchased from the federal government by the nonprofit
corporation for the purpose of continuing to provide
transitional housing after the expiration of the lease, the
property shall continue to be eligible for this classification.
To qualify under this clause, the taxpayer must apply to the
county assessor by May 30 of each year. The application must be
accompanied by an affidavit or other proof required by the
county assessor to determine qualification under this clause.
Property qualifying under this clause in 1992, 1993, or 1994
continues to receive a two percent class rate until the
five-year lease has expired provided that the property continues
to be used for the purposes as described in this clause.
Class 4d property has a class rate of 1.7 percent of market
value for taxes payable in 1990, and two percent of market value
for taxes payable thereafter.
(e) Residential rental property that would otherwise be
assessed as class 4 property under paragraph (a); paragraph (b),
clauses (1) and (2) (3); paragraph (c), clause (1), (2), (3), or
(4), is assessed at the class rate applicable to it under
Minnesota Statutes 1988, section 273.13, if it is found to be a
substandard building under section 273.1316. Residential rental
property that would otherwise be assessed as class 4 property
under paragraph (d) is assessed at 2.3 percent of market value
if it is found to be a substandard building under section
273.1316.
Sec. 23. Minnesota Statutes 1990, section 273.13,
subdivision 31, is amended to read:
Subd. 31. [CLASS 5.] Class 5 property includes:
(1) tools, implements, and machinery of an electric
generating, transmission, or distribution system or a pipeline
system transporting or distributing water, gas, crude oil, or
petroleum products or mains and pipes used in the distribution
of steam or hot or chilled water for heating or cooling
buildings, which are fixtures;
(2) unmined iron ore and low-grade iron-bearing formations
as defined in section 273.14; and
(3) vacant land; and
(4) all other property not otherwise classified.
Class 5 property has a class rate of 5.06 percent of market
value.
Sec. 24. Minnesota Statutes 1990, section 273.13,
subdivision 32, is amended to read:
Subd. 32. [TARGET CLASS RATE.] All classes of property
with a class rate of 5.06 percent have a target class rate of
four percent. At the time of submission of the biennial budget
under section 16A.11, the governor shall recommend the effective
class rate for taxes payable in the following two calendar years
by designating a "phase-in percentage," equal to the proportion
of the effective class rate that will be based on the target
class rate of four percent, with the remaining proportion based
on the class rate of 5.06 percent. The governor shall identify
and include within the budget funding for the increased
expenditures for homestead and agricultural credit aid over the
amount of expenditures for homestead and agricultural credit aid
provided in Laws 1989, First Special Session chapter 1, that are
estimated to result from the recommendation. At that time, the
governor may propose alternative programs other than homestead
and agricultural credit aid to prevent other taxpayers' taxes
from increasing as a result of the governor's recommended
increase in the phase-in percentage. The effective net class
rate is the sum of the products of:
(1) the phase-in percentage adopted by the legislature
multiplied by four percent; and
(2) 100 percent minus the phase-in percentage multiplied by
5.06 percent.
The phase-in percentage in any year cannot be less than it
was in the prior year. The phase-in percentage is ten percent
for taxes payable in 1991 is ten percent provided that the
governor may recommend an alternative phase-in percentage for
taxes payable in 1991, 29.2 percent for taxes payable in 1992,
34.0 percent for taxes payable in 1993, and 43.4 percent for
taxes payable in 1994 and thereafter.
Beginning in 1991, the commissioner of revenue shall
annually set the effective class rate to use for taxes payable
in the following year as provided in this subdivision and
announce it by June 1. For purposes of any aid, levy
limitation, debt limit, or salary limitation, and property tax
administration, net tax capacity must be computed with reference
to the effective class rate for the properties affected by this
subdivision.
Sec. 25. Minnesota Statutes 1990, section 273.13, is
amended by adding a subdivision to read:
Subd. 33. [UNIMPROVED PROPERTY.] Real property that is not
improved with a structure and that is not used as part of a
commercial or industrial activity must be classified and
assessed according to its highest and best use permitted under
the local zoning ordinance. If the ordinance permits more than
one use, the land must be classified and assessed according to
the highest and best use permitted under the ordinance. If no
such ordinance exists, the assessor shall consider the most
likely potential use of the vacant land based upon the use made
of surrounding land or land in proximity to the vacant land.
Sec. 26. [273.1317] [CLASSIFICATION OF 4C PROPERTY;
LOW-INCOME HOUSING.]
Subdivision 1. [DEFINITIONS.] (a) "Area median gross
income" means area median gross income as determined by the
United States Secretary of Housing and Urban Development under
section 142(d)(2)(B) of the Internal Revenue Code.
(b) "Internal Revenue Code" means the Internal Revenue Code
of 1986, as amended through December 31, 1990.
(c) "Low-income unit" means a unit that meets the
requirements of subdivision 3 and section 42(i)(3)(B), (C), and
(D) of the Internal Revenue Code.
(d) "Project" means a project for residential rental
property. A project consists of a single building and must
include the entire residential part of the building. Property
must not be treated as failing to be residential rental property
merely because part of the building is used for purposes other
than residential rental purposes.
(e) "Rehabilitation expenditures" has the meaning given it
in section 42(e)(2) of the Internal Revenue Code.
(f) "Rent restricted units" means rent restricted units as
defined and limited by section 42(g)(2) of the Internal Revenue
Code.
Subd. 2. [REQUIREMENTS.] Residential rental property that
does not receive a low-income housing credit under section 42 of
the Internal Revenue Code must meet the requirements in
subdivisions 3 to 5 to qualify for classification 4c under
section 273.13, subdivision 25, paragraph (c), clause (3), item
(iii).
Subd. 3. [RENT RESTRICTIONS; INCOME LIMITS.] (a) At the
irrevocable election of the taxpayer, either:
(1) 20 percent or more of the residential units in the
project must be both rent-restricted and occupied by individuals
whose income is 50 percent or less of area median gross income;
or
(2) 40 percent or more of the residential units in the
project must be both rent-restricted and occupied by individuals
whose income is 60 percent or less of area median gross income.
(b) For purposes of meeting the income limits under
paragraph (a) of tenants whose incomes increase, the provisions
of section 42(g)(2)(D) and (E) of the Internal Revenue Code
apply.
Subd. 4. [NEW OR REHABILITATED BUILDING.] A building must
be (1) a new building, the original use of which begins with the
owners or developers of the building, or (2) an existing
building with respect to which rehabilitation expenditures have
been paid or incurred by the owner or developer. To qualify
under this clause, the rehabilitation expenditures must meet the
requirements of section 42(e)(3)(A) of the Internal Revenue Code.
Subd. 5. [AGREEMENT.] The owner or developer must execute
an agreement with the local housing and redevelopment authority,
or other authority as provided in subdivision 7. The agreement
must be for a term of 15 years. The agreement must provide that
the requirements of subdivision 3 will be met during the term of
the agreement. The agreement must provide that the owner or
developer must maintain and make available to the authority the
information and records the authority considers necessary to
monitor compliance with the provisions of this section,
including rents, the incomes of tenants, and the number of
low-income units in the building.
Subd. 6. [RECORDS REVIEW.] The local housing and
redevelopment authority or other authority shall annually review
income and rental information and records maintained by the
owner or developer to determine compliance with the requirements
of this section. The local housing and redevelopment authority
or other authority shall report to the assessor responsible for
assessing the property at the time and in the manner required by
the assessor. The assessor shall determine the classification
of the property.
Subd. 7. [HOUSING AUTHORITY.] If a local housing or
redevelopment authority does not exist in the jurisdiction, the
county housing and redevelopment authority shall execute the
duties imposed in subdivisions 5 and 6. If a county housing and
redevelopment authority does not exist in the county, the
municipality must appoint the administrator of section 8
certificates within the jurisdiction or contract with a
qualified person or entity to perform the duties imposed in
subdivisions 5 and 6.
Subd. 8. [ADDITIONAL TAX.] Notwithstanding the provisions
of section 273.01, 274.01, or any other law, if the assessor
determines that the provisions of this section have not been met
for any period during which the property was classified under
section 273.13, subdivision 25, paragraph (c), clause (3), item
(iii), or valued under section 55, and received the benefits of
this section, an additional tax is imposed. The additional tax
is equal to the tax which would have been imposed if the
property had not been classified under section 273.13,
subdivision 25, paragraph (c), clause (3), item (iii), or valued
under section 55, and the tax actually imposed, during the
period of noncompliance. The additional tax must be extended
against the property on the tax list for the current year. No
interest or penalties may be levied on additional taxes if
timely paid. The tax imposed by this subdivision is a lien upon
the property assessed to the same extent and for the same
duration as other taxes imposed on the property.
Sec. 27. Minnesota Statutes 1990, section 275.08,
subdivision 1b, is amended to read:
Subd. 1b. The amounts certified under section 275.07 after
adjustment under section 275.07, subdivision 3, by an individual
local government unit, except for any amounts certified under
sections 124A.03, subdivision 2a, and 275.61, shall be divided
by the total gross tax capacity of all taxable properties within
the local government unit's taxing jurisdiction for tax payable
in 1989 and by the total net tax capacity of all taxable
properties within the local government unit's taxing
jurisdiction, for taxes payable in 1990 and thereafter. The
resulting ratio, the local government's local tax rate,
multiplied by each property's gross tax capacity for taxes
payable in 1989 and net tax capacity for taxes payable in 1990
and subsequent years shall be each property's total tax for that
local government unit before reduction by any credits.
Any amount certified to the county auditor under section
124A.03, subdivision 2a, or 275.61, after the dates given in
those sections, shall be divided by the total estimated market
value of all taxable properties within the taxing district. The
resulting ratio, the taxing district's new referendum tax rate,
multiplied by each property's estimated market value shall be
each property's new referendum tax before reduction by any
credits.
Sec. 28. [275.60] [LEVY OR BOND REFERENDUM; BALLOT
NOTICE.]
Notwithstanding any general or special law or any charter
provisions, any question submitted to the voters by any local
governmental subdivision at a general or special election after
the day of final enactment, authorizing a property tax levy or
tax rate increase, including the issuance of debt obligations
payable in whole or in part from property taxes, must include on
the ballot the following notice in bold-face type.
"BY VOTING "YES" ON THIS BALLOT QUESTION, YOU ARE VOTING
FOR A PROPERTY TAX INCREASE."
For purposes of this section and section 275.61, "local
governmental subdivision" includes counties, home rule and
statutory cities, towns, school districts, and all special
taxing districts. This statement is in addition to any general
or special laws or any charter provisions that govern the
contents of a ballot question.
This section does not apply to a school district bond
election if the debt service payments are to be made entirely
from transfers of revenue from the capital fund to the debt
service fund.
Sec. 29. [275.61] [REFERENDUM LEVY; MARKET VALUE.]
For local governmental subdivisions other than school
districts, any levy required to be approved and approved by the
voters at a general or special election for taxes payable in
1993 and thereafter, shall be levied against the market value of
all taxable property within the governmental subdivision. Any
levy amount subject to the requirements of this section shall be
certified separately to the county auditor under section 275.07.
The ballot shall state the maximum amount of the increased
levy as a percentage of market value and the amount that will be
raised by the new referendum tax rate in the first year it is to
be levied.
Sec. 30. Minnesota Statutes 1990, section 276.04,
subdivision 2, is amended to read:
Subd. 2. [CONTENTS OF TAX STATEMENTS.] (a) The treasurer
shall provide for the printing of the tax statements. The
commissioner of revenue shall prescribe the form of the property
tax statement and its contents. The statement must contain a
tabulated statement of the dollar amount due to each taxing
authority from the parcel of real property for which a
particular tax statement is prepared. The dollar amounts due
the county, township or municipality and school district must be
separately stated. The amounts due other taxing districts, if
any, may be aggregated. The dollar amounts, including the
dollar amount of any special assessments, may be rounded to the
nearest even whole dollar. For purposes of this section whole
odd-numbered dollars may be adjusted to the next higher
even-numbered dollar. The statement shall include the following
sentence, printed in upper case letters in boldface print: "THE
STATE OF MINNESOTA DOES NOT RECEIVE ANY PROPERTY TAX REVENUES.
THE STATE OF MINNESOTA REDUCES YOUR PROPERTY TAX BY PAYING
CREDITS AND REIMBURSEMENTS TO LOCAL UNITS OF GOVERNMENT."
(b) The property tax statements for manufactured homes and
sectional structures taxed as personal property shall contain
the same information that is required on the tax statements for
real property.
(c) Real and personal property tax statements must contain
the following information in the order given in this paragraph.
The information must contain the current year tax information in
the right column with the corresponding information for the
previous year in a column on the left:
(1) the property's estimated market value as defined in
section 272.03, subdivision 8;
(2) the property's gross tax, calculated by multiplying the
property's gross tax capacity times the total local tax rate and
adding to the result the sum of the aids enumerated in clause
(3);
(3) a total of the following aids:
(i) education aids payable under chapters 124 and 124A;
(ii) local government aids for cities, towns, and counties
under chapter 477A; and
(iii) disparity reduction aid under section 273.1398;
(4) for homestead residential and agricultural properties,
the homestead and agricultural credit aid apportioned to the
property. This amount is obtained by multiplying the total
local tax rate by the difference between the property's gross
and net tax capacities under section 273.13. This amount must
be separately stated and identified as "homestead and
agricultural credit." For purposes of comparison with the
previous year's amount for the statement for taxes payable in
1990, the statement must show the homestead credit for taxes
payable in 1989 under section 273.13, and the agricultural
credit under section 273.132 for taxes payable in 1989;
(5) any credits received under sections 273.119; 273.123;
273.135; 273.1391; 273.1398, subdivision 4; 469.171; and
473H.10, except that the amount of credit received under section
273.135 must be separately stated and identified as "taconite
tax relief"; and
(6) the net tax payable in the manner required in paragraph
(a).; and
(7) any additional amount of tax authorized under sections
124A.03, subdivision 2a, and 275.61. These amounts shall be
listed as "voter approved referenda levies."
The commissioner of revenue shall certify to the county
auditor the actual or estimated aids enumerated in clauses (3)
and (4) that local governments will receive in the following
year. In the case of a county containing a city of the first
class, for taxes levied in 1991, and for all counties for taxes
levied in 1992 and thereafter, the commissioner must certify
this amount by September 1.
Sec. 31. Minnesota Statutes 1990, section 278.05, is
amended by adding a subdivision to read:
Subd. 6. [EXCLUSION OF CERTAIN EVIDENCE.] Information,
including income and expense figures, verified net rentable
areas, and anticipated income and expenses, for income-producing
property which is not provided to the county assessor at least
30 days before any hearing under this chapter, is not admissible
except if necessary to prevent undue hardship or when the
failure to provide it was due to the unavailability of the
evidence at that time.
Sec. 32. Minnesota Statutes 1990, section 279.03,
subdivision 1a, is amended to read:
Subd. 1a. [RATE AFTER DECEMBER 31, 1990.] (a) Except as
provided in paragraph (b), interest on delinquent property
taxes, penalties, and costs unpaid on or after January 1, 1991,
shall be payable at the per annum rate determined in section
270.75, subdivision 5. If the rate so determined is less than
ten percent, the rate of interest shall be ten percent. The
maximum per annum rate shall be 14 percent if the rate specified
under section 270.75, subdivision 5, exceeds 14 percent. The
rate shall be subject to change on January 1 of each year.
(b) If a person is the owner of one or more parcels of
property on which taxes are delinquent, and the delinquent taxes
are more than 25 percent of the prior year's school district
levy, interest on the delinquent property taxes, penalties, and
costs unpaid after January 1, 1992, shall be payable at twice
the rate determined under paragraph (a) for the year.
Sec. 33. Minnesota Statutes 1990, section 281.17, is
amended to read:
281.17 [PERIOD FOR REDEMPTION.]
The period of redemption for all lands sold to the state at
a tax judgment sale shall be three years from the date of sale
to the state of Minnesota if the land is within an incorporated
area unless it is: (a) nonagricultural homesteaded land as
defined in section 273.13, subdivision 22,; (b) homesteaded
agricultural land as defined in section 273.13, subdivision 23,
paragraph (a),; or (c) seasonal recreational land as defined in
section 273.13, subdivision 25, paragraph (d)(1)
or (c)(4) clause (5), in for which event the period of
redemption is five years from the date of sale to the state of
Minnesota.
The period of redemption for homesteaded lands as defined
in section 273.13, subdivision 22, located in a targeted
neighborhood as defined in Laws 1987, chapter 386, article 6,
section 4, and sold to the state at a tax judgment sale is three
years from the date of sale. The period of redemption for all
lands located in a targeted neighborhood as defined in Laws
1987, chapter 386, article 6, section 4, except homesteaded
lands as defined in section 273.13, subdivision 22, and sold to
the state at a tax judgment sale is one year from the date of
sale.
The period of redemption for all other lands sold to the
state at a tax judgment sale shall be five years from the date
of sale, except that the period of redemption for nonhomesteaded
agricultural land as defined in section 273.13, subdivision 23,
paragraph (b), shall be two years from the date of sale if at
that time, that property is owned by a person who owns one or
more parcels of property on which taxes are delinquent, and the
delinquent taxes are more than 25 percent of the prior year's
school district levy.
Sec. 34. Minnesota Statutes 1990, section 290A.04,
subdivision 2h, is amended to read:
Subd. 2h. (a) If the gross property taxes payable on a
homestead increase more than ten percent over the net property
taxes payable in the prior year on the same property that is
owned by the same owner in both years, and the amount of that
increase is $40 or more for taxes payable in 1990 and 1991, $60
or more for taxes payable in 1992, $80 or more for taxes payable
in 1993, and $100 or more for taxes payable in 1994, a claimant
who is a homeowner shall be allowed an additional refund equal
to the sum of (1) 75 percent of the first $250 of the amount of
the increase over ten percent for taxes payable in 1990 and
1991, 75 percent of the first $275 of the amount of the increase
over ten percent for taxes payable in 1992, 75 percent of the
first $300 of the amount of the increase over ten percent for
taxes payable in 1993, and 75 percent of the first $325 of the
amount of the increase over ten percent for taxes payable in
1994, and (2) 90 percent of the amount of the increase over ten
percent plus $250 for taxes payable in 1990 and 1991, 90 percent
of the amount of the increase over ten percent plus $275 for
taxes payable in 1992, 90 percent of the amount of the increase
over ten percent plus $300 for taxes payable in 1993, and 90
percent of the amount of the increase over ten percent plus $325
for taxes payable in 1994. This subdivision shall not apply to
any increase in the gross property taxes payable attributable to
improvements made to the homestead after the assessment date for
the prior year's taxes.
(b) For purposes of this subdivision, the following terms
have the meanings given:
(1) "Net property taxes payable" means property taxes
payable after reductions made under sections 273.13,
subdivisions 22 and 23; 273.132; 273.135; 273.1391; and 273.42,
subdivision 2, and any other state paid property tax credits and
after the deduction of tax refund amounts for which the claimant
qualifies pursuant to subdivision 2 and this subdivision.
(2) "Gross property taxes" means net property taxes payable
determined without regard to the refund allowed under this
subdivision.
(c) In addition to the other proofs required by this
chapter, each claimant under this subdivision shall file with
the property tax refund return a copy of the property tax
statement for taxes payable in the preceding year or other
documents required by the commissioner.
On or before December 1, 1990, and December 1 of each of
the following three years, the commissioner shall estimate the
cost of making the payments provided by this subdivision for
taxes payable in the following year. Notwithstanding the open
appropriation provision of section 290A.23, if the estimated
total refund claims for taxes payable in 1991, 1993, or 1994
exceed the following amounts for the taxes payable year
designated, the commissioner shall increase the dollar amount of
tax increase which must occur before a taxpayer qualifies for a
refund so that the estimated total refund claims do not exceed
the appropriation limit.
Taxes payable in: Appropriation limit
1991 $13,000,000
1992 $6,500,000
1993 $6,000,000
1994 $5,500,000
The determinations of the revised thresholds by the
commissioner are not rules subject to chapter 14.
Sec. 35. Minnesota Statutes 1990, section 430.102,
subdivision 3, is amended to read:
Subd. 3. [ANNUAL IMPROVEMENT ASSESSMENT PROCEDURE;
APPEALS.] When the council has acted on the estimate of costs,
the city engineer, with the assistance of the city assessor,
shall prepare an assessment roll. The roll must list separately
the amounts to be specially assessed against benefited and
assessable property in the district in proportion to the
benefits, descriptions of the property, and the names of the
owners of the property to the extent they are available to the
engineer. The assessment roll must be filed in the office of
the city clerk and be available there for inspection.
The city council shall meet to consider objections to the
amounts of special assessments at least ten days after a notice
of hearing has been mailed to the named owners of the tracts,
parcels, and lots of property proposed to be assessed. The
notice must give the time, place, and purpose of the meeting,
but may refer to the assessment roll for further particulars.
When the city council has approved the amounts of the special
assessments in the assessment roll or has changed them, the city
clerk shall certify a copy of the assessment roll, with any
changes, to the county auditor to be extended on the tax lists
of the county. The special assessments must be collected with
and in the same manner as other taxes on property for the
current year.
Within 20 days after the adoption of the assessment, an
aggrieved person may appeal to the district court as provided in
section 430.03 except that no commissioners will be appointed to
consider the amount of benefits. If the court finds that the
assessment is not arbitrary, unreasonable, or made under a
demonstrable mistake of fact or erroneous theory of law, it
shall confirm the proceedings;. If the court finds that the
assessment is valid but for the inclusion of one or more items
of cost, it shall reduce the assessment by the amount
erroneously included and confirm the assessment as reduced.
Otherwise the court shall remand the matter to the city council
for reconsideration and reassessment of the benefits after
notice and hearing like those for the original assessments under
this subdivision. Objections to the assessment are waived
unless appealed under this paragraph.
Sec. 36. Minnesota Statutes 1990, section 430.102,
subdivision 4, is amended to read:
Subd. 4. [COSTS AND ANNUAL IMPROVEMENTS DEFINED.] For the
purposes of this chapter, with respect to pedestrian malls,
"annual improvements" means any reconstruction, replacement, or
repair of trees and plantings, furniture, roadway fixtures,
sidewalks, shelters, and other facilities of a pedestrian
mall, snow removal, sweeping, furnishing overhead or underground
heating for snow removal or for enjoyment of pedestrians, and
any other local improvement benefiting properties within the
district. For the purposes of this chapter, with respect to
annual improvements to and operation and maintenance of
pedestrian malls, "costs" means costs of annual improvements,
fees of consultants employed by the city council to assist in
the planning of annual improvements, premiums on public
liability insurance insuring the city and users of the
pedestrian mall and on property damage insurance for pedestrian
mall facilities, reasonable and necessary costs to the city for
the time of city officials, the advisory board, and employees
spent in connection with annual improvements to and operating
and maintaining a pedestrian mall and levying and collecting
special assessments and special taxes for the mall, publication
costs, and other costs incurred or to be incurred in connection
with annual improvements to and operation and maintenance of
pedestrian malls.
Sec. 37. Minnesota Statutes 1990, section 473F.01, is
amended to read:
473F.01 [PURPOSE; USE OF PROCEEDS.]
Subdivision 1. [PURPOSE.] The legislature finds it
desirable to improve the revenue raising and distribution system
in the seven county Twin Cities area to accomplish the following
objectives:
(1) To provide a way for local governments to share in the
resources generated by the growth of the area, without removing
any resources which local governments already have;
(2) To increase the likelihood of orderly urban development
by reducing the impact of fiscal considerations on the location
of business and residential growth and of highways, transit
facilities and airports;
(3) To establish incentives for all parts of the area to
work for the growth of the area as a whole;
(4) To provide a way whereby the area's resources can be
made available within and through the existing system of local
governments and local decision making;
(5) To help communities in different stages of development
by making resources increasingly available to communities at
those early stages of development and redevelopment when
financial pressures on them are the greatest; and
(6) To encourage protection of the environment by reducing
the impact of fiscal considerations so that flood plains can be
protected and land for parks and open space can be preserved;
and
(7) To provide for the distribution to municipalities of
additional revenues generated within the area or from outside
sources pursuant to other legislation.
Subd. 2. [USE OF PROCEEDS.] Except as provided in section
473F.08, subdivision 3a, the proceeds from the areawide tax
imposed under this chapter must be used by a local governmental
unit in the same manner and for the same purposes as the
proceeds from other ad valorem taxes levied by the local
governmental unit.
Sec. 38. Minnesota Statutes 1990, section 473F.02,
subdivision 3, is amended to read:
Subd. 3. "Commercial-industrial property" means the
following categories of property, as defined in section 273.13,
excluding that portion of such property (1) which may, by law,
constitute the tax base for a tax increment pledged pursuant to
under section 469.042 or 469.162, certification of which was
requested prior to August 1, 1979, to the extent and while such
tax increment is so pledged; or (2) which may, by law,
constitute the tax base for tax revenues set aside and paid over
for credit to a sinking fund pursuant to direction of the city
council in accordance with Laws 1963, chapter 881, as amended,
to the extent that such revenues are so treated in any year; or
(3) which is exempt from taxation pursuant to under section
272.02:
(a) That portion of class 3 property defined in Minnesota
Statutes 1971, section 273.13, consisting of stocks of
merchandise and furniture and fixtures used therewith;
manufacturers' materials and manufactured articles; and tools,
implements and machinery, whether fixtures or otherwise.
(b) That portion of class 4 property defined in Minnesota
Statutes 1971, section 273.13, which is either used or zoned for
use for any commercial or industrial purpose, except for such
property which is, or, in the case of property under
construction, will when completed be used exclusively for
residential occupancy and the provision of services to
residential occupants thereof. Property shall be considered as
used exclusively for residential occupancy only if each of not
less than 80 percent of its occupied residential units is, or,
in the case of property under construction, will when completed
be occupied under an oral or written agreement for occupancy
over a continuous period of not less than 30 days.
If the classification of property prescribed by section
273.13 is modified by legislative amendment, the references in
this subdivision shall be to such successor class or classes of
property, or portions thereof, as embrace the kinds of property
designated in this subdivision.
Sec. 39. Minnesota Statutes 1990, section 473F.02,
subdivision 8, is amended to read:
Subd. 8. "Municipality" means a city, town, or township
located in whole or part within the area, but not the cities of
New Prague or Northfield. If a municipality is located partly
within and partly without the area, the references in sections
473F.01 to 473F.13 to property or any portion thereof subject to
taxation or taxing jurisdiction within the municipality are to
such property or portion thereof as is located in that portion
of the municipality within the area, except that the fiscal
capacity of such a municipality shall be computed upon the basis
of the valuation and population of the entire municipality.
A municipality shall be excluded from the area if its
municipal comprehensive zoning and planning policies
conscientiously exclude most commercial-industrial development,
for reasons other than preserving an agricultural use. The
metropolitan council and the commissioner of revenue shall
jointly make this determination annually and shall notify those
municipalities that are ineligible to participate in the tax
base sharing program provided in this chapter for the following
year.
Sec. 40. Minnesota Statutes 1990, section 473F.02,
subdivision 12, is amended to read:
Subd. 12. "Market value" of real and personal property
within a municipality means the "actual market value" assessor's
estimated market value of all real and personal property,
including the value of manufactured housing, within the
municipality, determined in the manner and with respect to the
property described for school districts in section 475.53,
subdivision 4, except that no adjustment shall be made for
property on which taxes are paid into the state treasury under
gross earnings tax laws applicable to common carrier railroads.
For purposes of sections 473F.01 to 473F.13, the commissioner of
revenue shall annually make determinations and reports with
respect to each municipality which are comparable to those it
makes for school districts under section 124.2131, subdivision
1, in the same manner and at the same times as are prescribed by
the subdivision. The commissioner of revenue shall annually
determine, for each municipality, information comparable to that
required by section 475.53, subdivision 4, for school districts,
as soon as practicable after it becomes available. The
commissioner of revenue shall then compute the equalized market
value of property within each municipality using the aggregate
sales ratios from the department of revenue's sales ratio study.
Sec. 41. Minnesota Statutes 1990, section 473F.02,
subdivision 13, is amended to read:
Subd. 13. "Valuation" means the market value of real and
personal property within a municipality as defined in
subdivision 12.
Sec. 42. Minnesota Statutes 1990, section 473F.05, is
amended to read:
473F.05 [GROSS NET TAX CAPACITY YEARS.]
On or before August 5 of each year, the assessors within
each county in the area shall determine and certify to the
county auditor the gross net tax capacity in that year of
commercial-industrial property subject to taxation within each
municipality in the county, determined without regard to section
469.177, subdivision 3.
Sec. 43. Minnesota Statutes 1990, section 473F.06, is
amended to read:
473F.06 [INCREASE IN GROSS NET TAX CAPACITY.]
On or before July 15 of each year, the auditor of each
county in the area shall determine the amount, if any, by which
the gross net tax capacity determined in the preceding year
pursuant to under section 473F.05, of commercial-industrial
property subject to taxation within each municipality in the
auditor's county exceeds the gross net tax capacity in 1971 of
commercial-industrial property subject to taxation within that
municipality. If a municipality is located in two or more
counties within the area, the auditors of those counties shall
certify the data required by section 473F.05 to the county
auditor who is responsible under other provisions of law for
allocating the levies of that municipality between or among the
affected counties. That county auditor shall determine the
amount of the net excess, if any, for the municipality under
this section, and certify that amount under section 473F.07.
Notwithstanding any other provision of sections 473F.01 to
473F.13 to the contrary, in the case of a municipality which is
designated on July 24, 1971, as a redevelopment area pursuant to
under section 401(a)(4) of the Public Works and Economic
Development Act of 1965, Public Law Number 89-136, the increase
in its gross net tax capacity of commercial-industrial property
for purposes of this section shall be determined in each year
subsequent to the termination of such designation by using as a
base the gross net tax capacity of commercial-industrial
property in that municipality in the 1989 assessment year
following that in which such designation is terminated, rather
than the gross net tax capacity of such property in 1971. The
increase in gross total net tax capacity determined by this
section shall be reduced by the amount of any decreases in the
gross net tax capacity of commercial-industrial property
resulting from any court decisions, court related stipulation
agreements, or abatements for a prior year, and only in the
amount of such decreases made during the 12-month period ending
on May 1 of the current assessment year, where such decreases,
if originally reflected in the determination of a prior
year's gross net tax capacity under section 473F.05, would have
resulted in a smaller contribution from the municipality in that
year. An adjustment for such decreases shall be made only if
the municipality made a contribution in a prior year based on
the higher gross net tax capacity of the commercial-industrial
property.
Sec. 44. Minnesota Statutes 1990, section 473F.07, is
amended to read:
473F.07 [COMPUTATION OF AREAWIDE TAX BASE.]
Subdivision 1. Each county auditor shall certify the
determinations pursuant to under sections 473F.05 and 473F.06 to
the administrative auditor on or before August 1 of each year.
The administrative auditor shall determine an amount equal
to 40 percent of the sum of the amounts certified pursuant to
under section 473F.06, and divide that sum by 2-1/2. The
resulting amount shall be known as the "areawide gross net tax
capacity for ........(year)."
Subd. 2. The commissioner of revenue shall certify to the
administrative auditor, on or before August 10 of each year, the
population of each municipality for the second preceding year,
the proportion of that population which resides within the area,
the average fiscal capacity of all municipalities in the area
for the preceding year, and the fiscal capacity of each
municipality in the area for the preceding year.
Subd. 3. The administrative auditor shall determine, for
each municipality, the product of (a) its population, and (b)
the proportion which the average fiscal capacity of
municipalities for the preceding year bears to the fiscal
capacity of that municipality for the preceding year, and (c)
two. The product shall be the areawide tax base distribution
index for that municipality, provided that (a) if the product in
the case of any municipality is less than its population, its
index shall be increased to its population, and (b). If a
municipality is located partly within and partly without the
area its index shall be that which is otherwise determined
hereunder, multiplied by the proportion which its population
residing within the area bears to its total population as of the
preceding year.
Subd. 4. The administrative auditor shall determine the
proportion which the index of each municipality bears to the sum
of the indices of all municipalities and shall then multiply
this proportion in the case of each municipality, by the
areawide net tax capacity, provided that if the distribution net
tax capacity for a municipality is less than 95 percent of the
municipality's previous year distribution net tax capacity, and
more than ten percent of the municipality's fiscal capacity
consists of manufactured home property, the municipality's
distribution net tax capacity will be increased to 95 percent of
the previous year net tax capacity and the distribution net tax
capacity of other municipalities in the area will be
proportionately reduced.
Subd. 5. The product result of the multiplication
procedure prescribed by subdivision 4 shall be known as the
"areawide gross net tax capacity for ........(year) attributable
to ..................(municipality)." The administrative
auditor shall certify such product to the auditor of the county
in which the municipality is located on or before August 15.
Sec. 45. Minnesota Statutes 1990, section 473F.08,
subdivision 2, is amended to read:
Subd. 2. The net tax capacity of a governmental unit is
its net tax capacity, as determined in accordance with other
provisions of law including section 469.177, subdivision 3,
subject to the following adjustments:
(a) There shall be subtracted from its net tax capacity, in
each municipality in which the governmental unit exercises ad
valorem taxing jurisdiction, an amount which bears the same
proportion to 40 percent of the amount certified in that year
pursuant to section under sections 473F.06 in respect to that
and 473F.07 for the municipality as the total preceding year's
net tax capacity of commercial-industrial property which is
subject to the taxing jurisdiction of the governmental unit
within the municipality, determined without regard to section
469.177, subdivision 3, bears to the total preceding year's net
tax capacity of commercial-industrial property within the
municipality, determined without regard to section 469.177,
subdivision 3;
(b) There shall be added to its net tax capacity, in each
municipality in which the governmental unit exercises ad valorem
taxing jurisdiction, an amount which bears the same proportion
to the areawide net tax capacity for the year attributable to
that municipality as the total preceding year's net tax capacity
of residential property which is subject to the taxing
jurisdiction of the governmental unit within the municipality
bears to the total preceding year's net tax capacity of
residential property of the municipality.
Sec. 46. Minnesota Statutes 1990, section 473F.08,
subdivision 5, is amended to read:
Subd. 5. On or before August 25 of each year, the county
auditor shall certify to the administrative auditor that portion
of the levy of each governmental unit determined pursuant to
under subdivision 3, clause (a). The administrative auditor
shall then determine the areawide tax rate sufficient to yield
an amount equal to the sum of such levies from the
areawide gross net tax capacity. On or before September 1 of
each year, the administrative auditor shall certify the areawide
tax rate to each of the county auditors.
Sec. 47. Minnesota Statutes 1990, section 473F.08,
subdivision 6, is amended to read:
Subd. 6. The areawide tax rate determined in accordance
with subdivision 5 shall apply in the taxation of to each item
of commercial-industrial property subject to taxation within a
municipality, including property located within any tax
increment financing district, as defined in section 469.174,
subdivision 9, to that portion of the net tax capacity of the
item which bears the same proportion to its total net tax
capacity as 40 percent of the amount determined pursuant to
section under sections 473F.06 in respect to the municipality in
which the property and 473F.07 is taxable bears to the amount
determined pursuant to under section 473F.05. The tax rate
determined in accordance with subdivision 4 shall apply in the
taxation of the remainder of the net tax capacity of the item.
Sec. 48. Minnesota Statutes 1990, section 473F.09, is
amended to read:
473F.09 [ADJUSTMENTS IN DATES.]
If, by reason of the enactment of any other law, the date
by which the commissioner of revenue is required to certify to
the county auditors the records of proceedings affecting the
gross net tax capacity of property is advanced to a date earlier
than June 30, the dates specified in sections 473F.07 and
473F.10 may be modified in the years to which such other law
applies in the manner and to the extent prescribed by the
administrative auditor.
Sec. 49. Minnesota Statutes 1990, section 473F.13,
subdivision 1, is amended to read:
Subdivision 1. If a qualifying municipality is dissolved,
is consolidated with all or part of another municipality,
annexes territory, has a portion of its territory detached from
it, or is newly incorporated, the secretary of state shall
immediately certify that fact to the commissioner of revenue.
The secretary of state shall also certify to the commissioner of
revenue the current population of the new, enlarged, or
successor municipality, if determined by the Minnesota municipal
board incident to consolidation, annexation, or incorporation
proceedings. The population so certified shall govern for
purposes of sections 473F.01 to 473F.13 until the metropolitan
council files its first population estimate as of a later date
with the commissioner of revenue. If an annexation of
unincorporated land occurs without proceedings before the
Minnesota municipal board, the population of the annexing
municipality as previously determined shall continue to govern
for purposes of sections 473F.01 to 473F.13 until the
metropolitan council files its first population estimate as of a
later date with the commissioner of revenue.
Sec. 50. Minnesota Statutes 1990, section 477A.014,
subdivision 4, is amended to read:
Subd. 4. [COSTS BILLED TO COMMISSIONER OF REVENUE.] The
commissioner of state planning shall annually bill the
commissioner of revenue for one-half of the costs incurred by
the state planning agency in the preparation of materials
required by section 116K.04, subdivision 4, clause (10). The
commissioner of revenue shall deduct these amounts from the next
payments to be made to appropriate local units of government.
Amounts deducted must be credited to the general fund. The
state auditor shall bill the commissioner of revenue for the
costs of the services provided by the government information
division and the parts of the constitutional office that are
related to the government information function, not to exceed
$217,000 in fiscal year 1992 and $217,000 in fiscal year 1993
and thereafter. The commissioner of administration shall bill
the commissioner of revenue for the costs of the local
government records program and the intergovernmental information
systems activity, not to exceed $201,100 in fiscal year 1992 and
$205,800 in fiscal year 1993 and thereafter. The commissioner
of employee relations shall bill the commissioner of revenue for
the costs of administering the local government pay equity
function, not to exceed $56,000 in fiscal year 1992 and $55,000
in fiscal year 1993 and thereafter.
Sec. 51. Minnesota Statutes 1990, section 477A.014, is
amended by adding a subdivision to read:
Subd. 5. [DEDUCTION FROM AID PAYMENTS.] The commissioner
of revenue shall deduct the amounts certified under subdivision
4 from the aid payments to be made to appropriate local units of
government in the next aid payment year. Amounts must be
transferred from the local government trust fund to the general
fund.
Sec. 52. Minnesota Statutes 1990, section 515A.4-102, is
amended to read:
515A.4-102 [DISCLOSURE STATEMENT; GENERAL PROVISIONS.]
A disclosure statement shall fully disclose:
(a) the name and principal address of the declarant and the
address and the name, if any, and number, if available, of the
condominium;
(b) a general description of the condominium; including
without limitation the types and number of all buildings, units
and amenities, and declarant's schedule of commencement and
completion of construction thereof;
(c) the total number of additional units that may be
included in the condominium and whether the declarant intends to
rent or market blocks of units to investors;
(d) a copy of the declaration other than the condominium
plat, condominium plat for the particular unit, bylaws, articles
of incorporation, rules and regulations, and any contracts and
leases to which the unit owners or association will be subject
and which may not be canceled upon 30 days notice by the
association;
(e) any current balance sheet and a projected budget for
the association for the first full or partial year during which
a unit is conveyed to a unit owner other than a declarant and
any projected budget for future years which the association has
adopted, and a statement of who prepared the balance sheet,
projected budget or budget. The budget or projected budget
shall include, without limitation:
(1) a statement of the amount, or a statement that there is
no amount, included in the budget as a reserve for repairs and
replacement;
(2) a statement of any other reserves;
(3) the projected common expense assessment by category of
expenditures for the association;
(4) the projected monthly common expense assessment for
each type of unit;
(f) any supplies and services not reflected in the budget
or projected budget which the declarant provides, or expenses
which the declarant pays, and which the declarant expects may
become at any subsequent time a common expense of the
association and the projected common expense assessment
attributable to each of those services or expenses for the
association and for each type of unit;
(g) any initial or special fee due from the purchaser to
the declarant or the association at closing, together with a
description of the purpose and method of calculating the fee;
(h) a description of any liens, defects, or encumbrances on
or affecting the title to the condominium after the contemplated
conveyance;
(i) a description of any financing offered by the
declarant;
(j) the terms of any warranties provided by the declarant,
including the warranties set forth in sections 515A.4-111 and
515A.4-112, and limitations imposed by the declarant on the
enforcement thereof;
(k) a statement that:
(1) within 15 days after receipt of a disclosure statement,
a purchaser may, prior to conveyance, cancel any purchase
agreement of a unit from a declarant;
(2) if a declarant fails to provide a disclosure statement
to a purchaser before conveying a unit, that purchaser may
recover from the declarant an amount not to exceed five percent
of the sales price of the unit; and
(3) if a purchaser received the disclosure statement more
than 15 days before signing a purchase agreement, the purchaser
cannot cancel the agreement;
(l) a statement disclosing, to the extent of the actual
knowledge of the declarant or an affiliate of the declarant
after reasonable inquiry, any judgments against the association,
the status of any pending suits to which the association is a
party, and the status of any pending suits material to the
condominium;
(m) a statement that any earnest money paid in connection
with the purchase of a unit will be held in an escrow account
until closing and will be returned to the purchaser if the
purchaser cancels the purchase agreement pursuant to section
515A.4-106;
(n) a description of the insurance coverage to be provided
for the benefit of unit owners;
(o) any current or expected fees or charges to be paid by
unit owners for the use of the common elements and other
facilities related to the condominium; and
(p) whether financial arrangements have been provided for
completion of all improvements labeled "MUST BE BUILT" pursuant
to section 515A.4-117 (Declarant's Obligation to Complete and
Restore); and
(q) a statement (1) that there are no delinquent taxes on
the property or, if there are delinquent taxes on the property,
the amount of the delinquent taxes and the length of the
delinquency, and (2) that discloses the amount, if known, of
taxes due in the current year.
Sec. 53. Laws 1988, chapter 719, article 16, section 1,
subdivision 3, is amended to read:
Subd. 3. [SPECIAL SERVICES.] "Special services" means the
following services rendered or contracted for by the city:
(1) snow and ice removal;
(2) sweeping and cleaning sidewalks, curbs, gutters,
streets, and alleys;
(3) litter, poster, and handbill removal;
(4) construction, repair, operation, and maintenance of
sidewalks, curbs, gutters, bus shelters, parking facilities,
lighting, benches, chairs, tables, telephone booths, traffic
signs, fire hydrants, newsstands, kiosks, trash receptacles,
utility connections, marquees, awnings, canopies, display cases,
information booths, and banners;
(5) landscaping, planting, repair, maintenance, and care of
trees, shrubs, bushes, flowers, grass, and other decorative
materials;
(6) security personnel, equipment, and systems;
(7) approval and supervision of special activities;
(8) insurance; and
(9) administration, coordination, studies, and preparation
of designs.
Special service district funds may be used to pay operating
costs of a neighborhood business association composed of a
majority of owners or operators of businesses located within the
district.
Sec. 54. Laws 1990, chapter 604, article 3, section 46,
subdivision 1, is amended to read:
Subdivision 1. [LIMITED VALUATION INCREASE.] (a)
Notwithstanding Minnesota Statutes, section 273.11, or any other
law to the contrary, the estimated market value of a
manufactured home park, as defined in section 327.14,
subdivision 3, and assessed under section 273.13, subdivision
25, for taxes levied in 1990, may not exceed 133-1/3 percent of
its estimated market value for taxes levied in 1989 as limited
by Laws 1989, First Special Session chapter 1, article 3,
section 32, subdivision 1. The excess market value, including
value added by the January 2, 1991, assessment, must be entered
equally in the next two succeeding as follows: two-thirds in
the 1991 assessment and one-third in the 1992 assessment years.
(b) This subdivision does not apply to increases in value
attributable to improvements made to the real estate since the
January 2, 1989, assessment. It does not apply to property
becoming subject to taxation since the January 2, 1989,
assessment. The limitation in this subdivision applies to any
increase in valuation imposed by the local boards of review
under section 274.01, the county boards of equalization under
section 274.13, and the state board of equalization and the
commissioner of revenue under sections 270.11, 270.12, and
270.16.
Sec. 55. [CERTAIN COUNTIES; LOW-INCOME HOUSING.]
Subdivision 1. [LOW-INCOME HOUSING.] In addition to the
normal market value determination under Minnesota Statutes,
section 273.11, in the case of Hennepin, Dakota, Ramsey, St.
Louis, and Beltrami counties, a special market value for
properties classified under section 273.13, subdivision 25,
paragraph (c), clauses (1), item (ii), (3) and (4), the owners
of which have applied to the assessor for treatment in the
initial year under this subdivision, shall be determined as
provided in this subdivision. If a limited dividend entity owns
the property, it must include as the managing general partner a
nonprofit organization operating under the provisions of
Minnesota Statutes, chapter 317A and qualifying under section
501(c)(3) of the Internal Revenue Code of 1986, as amended
through December 31, 1990, and the limited partnership agreement
must provide that the managing general partner has sufficient
powers so that it materially participates in the management and
control of the limited dividend entity. The value shall be
determined by capitalizing the net operating income derived from
actual restricted rents, rent subsidies under section 8 of the
United States Housing Act of 1937, as amended, or other
governmental programs, and standardized expenses which are from
time to time determined by the housing finance agency for
similar projects. Net operating incomes must be greater than
zero. The special market value shall be used to compute the
taxes owing only if the entire structure is occupied by
low-income, elderly, or handicapped persons or low- and
moderate-income families as defined in the applicable laws. The
manager of properties valued under this subdivision must
demonstrate annually to the assessor that tax savings realized
by use of this method of valuation have inured to the tenants.
The tax savings must be used for reduced rents, improved
maintenance, capital improvements, or capital reserves. Capital
reserves must be in accordance with agreements approved by the
governmental regulatory authority. After the first year,
certification that the funds have been spent as required shall
be made by the housing and redevelopment authority performing
the financial audit or review on the property as required by the
regulatory authority. A copy of the certification must be
submitted to the assessor by May 30 of each year. If the
assessor determines upon review of the certification that the
benefit has not inured to the tenants, the property shall be
subject to additional property taxes in the amount of triple the
difference between the taxes determined in accordance with this
subdivision and the amount of tax payable on the property if it
were valued according to subdivision 1 and classified according
to section 273.13, subdivision 25, paragraph (a) or (b), as
appropriate for those years in which the benefit of the tax
savings did not inure to the tenants, less the amount of penalty
imposed under Minnesota Statutes, section 273.1317, subdivision
8.
Subd. 2. [EFFECTIVE DATE.] This section is effective only
for taxes payable in 1993, 1994, and 1995 in any of the counties
of Hennepin, Ramsey, Dakota, St. Louis, and Beltrami that
approves it and complies with Minnesota Statutes, section
645.021, subdivision 3.
Sec. 56. [FIRST CLASS CITY SCHOOL DISTRICTS; REFERENDUM
LEVIES.]
Notwithstanding Minnesota Statutes, section 124A.03,
subdivision 2a, if a school district located in a city of the
first class approves a referendum levy, which is effective
beginning with taxes payable in 1993, it shall be levied against
the net tax capacity of all taxable property in the district.
Sec. 57. [BUFFALO-RED RIVER WATERSHED DISTRICT; PAYMENT OF
HOMESTEAD AND AGRICULTURAL CREDIT AID; APPROPRIATING MONEY.]
$153,787 is appropriated from the general fund to the
commissioner of revenue for distribution to the Buffalo-Red
River watershed district as restoration of reduced homestead and
agricultural credit aid for 1990.
Sec. 58. [RED LAKE WATERSHED DISTRICT; PAYMENT OF
HOMESTEAD AND AGRICULTURAL CREDIT AID; APPROPRIATING MONEY.]
$185,777 is appropriated from the general fund to the
commissioner of revenue for distribution to the Red Lake
watershed district as restoration of reduced homestead and
agricultural credit aid for 1990.
Sec. 59. [LAKEFIELD; SCHOOL DISTRICT LEVY REFERENDUM.]
Independent school district No. 325, Lakefield, may conduct
one levy referendum authorized by Minnesota Statutes, section
124A.03, subdivision 2, before November 1, 1991. The referendum
must be conducted by mail as provided in that section. Only one
levy referendum may be conducted in 1991 by the district.
Sec. 60. [MANKATO; SCHOOL DISTRICT LEVY REFERENDUM.]
Independent school district No. 77, Mankato, may conduct
one levy referendum authorized by Minnesota Statutes, section
124A.03, subdivision 2, before November 1, 1991. The referendum
must be conducted by mail as provided in that section, unless it
is done along with a capital referendum in the district before
September 1, 1991. One levy referendum may be conducted by mail
in 1991 by the district regardless of whether the district
conducted a referendum at the polls on the levy earlier in the
year.
Sec. 61. [WAYZATA; SCHOOL DISTRICT LEVY REFERENDUM.]
Independent school district No. 284, Wayzata, may conduct
one levy referendum authorized by Minnesota Statutes, section
124A.03, subdivision 2, before November 1, 1991. The referendum
must be conducted by mail as provided in that section. Only one
levy referendum may be conducted in 1991 by the district.
Sec. 62. [ADMINISTRATIVE DIRECTIVE TO ASSESSORS.]
The commissioner of revenue shall prepare an administrative
directive advising assessors of proper assessment practices with
respect to general and routine repair and maintenance of
property. The directive must list types of repairs that do not
increase the assessor's estimated market value. On or before
August 1, 1991, the commissioner shall provide a draft of the
proposed administrative directive to the chairs of the senate
committee on taxes and tax laws and the house committee on taxes
for their advice and comment. The directive shall be mailed to
assessors by September 1, 1991.
Sec. 63. [REPEALER.]
Minnesota Statutes 1990, sections 473F.02, subdivisions 9,
11, 16, 17, 18, 19, and 20; 473F.12; and 473F.13, subdivisions 2
and 3, are repealed.
Sec. 64. [APPLICABILITY.]
Sections 37 to 49 and 63 apply in the counties of Anoka,
Carver, Dakota, Hennepin, Ramsey, Scott, and Washington.
Sec. 65. [EFFECTIVE DATE.]
Sections 1, 4, 35, 36, 57, 58, and 62 are effective the day
following final enactment.
Sections 2, 3, 11, 15 to 22, 24, 26 to 28, 30, 37 to 49,
and 63 are effective for taxes levied in 1991, payable in 1992,
and thereafter.
Sections 5 and 6 are effective for referenda held after
November 1, 1992, for taxes payable in 1993 and thereafter.
Sections 7 and 52 are effective July 1, 1991.
Sections 8, 9 and 31 are effective for appeals filed after
July 31, 1991.
Section 10 is effective only for taxes payable in 1992,
1993, 1994, and 1995.
Sections 12 and 14 are effective for taxes payable in 1993
and thereafter, except the deletion of the language "or any
single contiguous lot fronting on the same street" in sections
12 and 14 shall be effective for taxes payable in 1992 and
thereafter.
Section 13 is effective the day following final enactment
and applies to real property acquired after December 31, 1990.
Sections 23 and 25 are effective for taxes payable in 1993
and thereafter.
Section 29 is effective for referenda for taxes payable in
1993 and thereafter.
Sections 32 and 33 are effective for taxes deemed
delinquent after December 31, 1991.
Sections 50 and 51 are effective for aids payable in 1991
and thereafter.
Section 53 is effective the day after the governing body of
the city of Minneapolis complies with Minnesota Statutes,
section 645.021, subdivision 3.
Section 54 is effective for the 1991 and 1992 assessment
year.
Section 59 is effective the day after the governing body of
independent school district No. 325, Lakefield, complies with
Minnesota Statutes, section 645.021, subdivision 3.
Section 60 is effective the day after the governing body of
independent school district No. 77, Mankato, complies with
Minnesota Statutes, section 645.021, subdivision 3.
Section 61 is effective the day after the governing body of
independent school district No. 284, Wayzata, complies with
Minnesota Statutes, section 645.021, subdivision 3.
ARTICLE 2
LOCAL GOVERNMENT TRUST FUND
Section 1. [3.862] [ADVISORY COMMISSION ON
INTERGOVERNMENTAL RELATIONS.]
Subdivision 1. [CREATION.] An advisory commission on
intergovernmental relations is created.
Subd. 2. [DEFINITIONS.] (a) "Local government trust fund"
or "trust fund" means the trust fund established under section 2.
(b) "Metropolitan area" means the seven county metropolitan
area defined in section 473.121.
(c) "Special taxing district" means a special taxing
district as defined in Laws 1991, chapter 2, article 8, section
1.
Subd. 3. [DUTIES.] (a) By February 1 of each year, the
commission shall submit to the speaker of the house and
president of the senate recommendations for a formula or
formulas to allocate the receipts of the local government trust
fund to cities, counties, special taxing districts, and towns
for the fiscal year beginning in the next calendar year. A
recommendation of the commission must be approved by a
three-fourths majority vote of the commission. Recommendations
may be adopted, modified, or rejected by a bill enacted into law.
(b) In preparing its recommendations for intergovernmental
aid formulas, the commission shall consider and balance the
following goals:
(1) equalizing the access of local governments to fiscal
resources relative to the need for and cost of providing local
services;
(2) increasing accountability for state and local fiscal
decisions;
(3) compensating for spillovers in the cost and benefits of
local services; and
(4) funding municipal and county programs that are required
by state law or that can only be appropriately provided on a
uniform statewide basis. The commission may establish other
recommendations for intergovernmental aid formulas to be
financed from trust fund money.
(c) The commission shall study elements of state and local
intergovernmental relations it considers appropriate. The
studies may include examination of (1) requirements under state
law that local governments provide services or benefits not
funded by state appropriations, and (2) development of
incentives or mechanisms for increased local efficiencies
through cooperation or combination of local government units.
Subd. 4. [MEMBERSHIP; TERMS.] (a) For July 1, 1991,
through June 30, 1992, the commission consists of 20 members as
follows:
(1) Five members of the house of representatives, appointed
by the speaker. At least two of the members must represent
districts located outside of the metropolitan area;
(2) Five members of the senate, appointed by the
subcommittee on committees of the committee on rules. At least
two of the members must represent districts located outside of
the metropolitan area;
(3) Four city officials, appointed by the governor from a
slate of at least eight city officials submitted by the League
of Minnesota Cities. At least four of the officials on the
slate must reside outside the metropolitan area; at least two of
the officials appointed must reside outside of the metropolitan
area;
(4) Three county officials, appointed by the governor from
a slate of at least six county officials submitted by the
Association of Minnesota Counties. At least two of the
officials on the slate must reside outside the metropolitan
area; at least one of the officials appointed must be from a
county located outside of the metropolitan area;
(5) One town official, appointed by the governor from a
slate of at least two submitted by the Minnesota Association of
Township Officers; and
(6) Two representatives of the executive branch of state
government, appointed by the governor.
(b) Beginning July 1, 1992, the membership of the
commission is reduced to 14 members. The legislative membership
is reduced to two members of the house of representatives and
two members of the senate. At least two of these members, one
from each house, must represent a district located outside of
the metropolitan area. In appointing members of the commission
in 1991, the speaker and the subcommittee on committees shall
each designate three of the members as 1991 appointments. The
terms of these members expire on June 30, 1992.
(c) The terms of nonlegislative members are as provided by
section 15.059 for advisory councils and committees. The terms
of legislative members are for two calendar years. Legislative
members are members only so long as they are members of the
legislature.
Subd. 4. [COMPENSATION.] Legislative members of the
commission are compensated as provided in section 3.101.
Nonlegislative members are compensated as provided under section
15.059.
Subd. 5. [STAFF.] In carrying out its duties the
commission may request information and assistance from the
department of revenue and other state agencies.
Sec. 2. [16A.711] [LOCAL GOVERNMENT TRUST FUND.]
Subdivision 1. [CREATION.] The commissioner shall deposit
to the credit of the local government trust fund all money
available to the credit of the trust. The commissioner shall
maintain the trust as a separate fund to be used only to pay
money, as provided by law, to local governments for
intergovernmental aid or to repay advances made by the general
fund, as provided under subdivision 4.
Subd. 2. [APPROPRIATION.] The money to be paid by law from
the local government trust fund is appropriated annually.
Subd. 3. [ESTIMATES; REDUCTION OF PAYMENTS.] (a) At the
beginning of each fiscal year the commissioner, in consultation
with the commissioner of revenue, shall estimate for the fiscal
year:
(1) the amount of revenues to be deposited in the trust
fund under sections 297A.44 and 297B.09 and other law; and
(2) the payments authorized by law to be made out of the
trust.
If the estimated payments exceed the estimated receipts of
the trust fund, the appropriations from the trust to each
program are proportionately reduced, unless otherwise provided
by law.
If the estimated receipts of the trust fund exceed the
estimated payments by $1,000,000 or more, the appropriation from
the trust fund to each intergovernmental aid program is
increased proportionately. The aid paid to each local
government under the program is increased proportionately unless
otherwise provided by law.
(b) If as a result of changes in economic conditions or if
information becomes available that indicates changes either in
receipts or payments from the trust fund, the commissioner may
at other times estimate the amount of receipts or payments and
reduce or restore the appropriations under paragraph (a).
Subd. 4. [GENERAL FUND ADVANCES.] If the money in the
trust fund is insufficient to make payments on the dates
provided by law, but the commissioner estimates receipts for the
fiscal year will be sufficient, the commissioner shall advance
money from the general fund to the trust fund necessary to make
the payments. On or before the close of the biennium the trust
shall repay the advances with interest, calculated at the rate
of earnings on invested treasurer's cash, to the general fund.
Sec. 3. [LOCAL GOVERNMENT TRUST FUND; FISCAL YEARS 1992
AND 1993 APPROPRIATIONS.]
Subdivision 1. [APPROPRIATIONS.] (a) The amounts necessary
to make the following fiscal year 1992 and 1993 payments are
appropriated to the commissioner of revenue from the local
government trust fund:
(1) homestead and agricultural credit aid to counties,
cities, towns, and special taxing districts under Minnesota
Statutes, section 273.1398;
(2) disparity reduction aid to counties, cities, towns, and
special taxing districts under Minnesota Statutes, section
273.1398;
(3) local government aid and equalization aid under
Minnesota Statutes, chapter 477A;
(4) additional homestead and agricultural credit guarantee
under Minnesota Statutes, section 273.1398, subdivision 5;
(5) supplemental homestead property tax relief under
Minnesota Statutes, section 273.1391;
(6) disparity reduction credit under Minnesota Statutes,
section 273.1398, subdivision 4;
(7) 25 percent of the state aid for county human services
under Minnesota Statutes, section 273.1398, subdivision 5a; and
(8) attached machinery aid to counties under Minnesota
Statutes, section 273.138.
(b) The following sums are appropriated for fiscal years
1992 and 1993 from the local government trust fund:
(1) $852,000 to the commissioner of revenue to administer
the local option tax for fiscal year 1992, except any unused
portion of the appropriation may be carried over to fiscal year
1993 and $660,000 for fiscal year 1993;
(2) to the commissioner of finance to administer the trust
fund, $95,000 for fiscal year 1992 and $105,000 for fiscal year
1993; and
(3) to the advisory commission on intergovernmental
relations to pay nonlegislative members' per diem expenses,
$25,000 for fiscal year 1992 and $25,000 for fiscal year 1993.
Subd. 2. [CONTINGENT REDUCTIONS.] If the commissioner of
finance, in consultation with the commissioner of revenue,
estimates that the receipts of the local government trust fund
will be insufficient to pay the appropriations under subdivision
1, the appropriations under paragraph (a), clauses (5), (6),
(7), and (8), and paragraph (b) must be paid in full and the
appropriations under clauses (1) to (4) must be reduced as
provided by Minnesota Statutes, chapter 477A.
Sec. 4. [LOCAL GOVERNMENT TRUST; FISCAL YEARS 1994 and
1995 APPROPRIATIONS.]
(a) The amounts necessary to make the following fiscal year
1994 and 1995 payments are appropriated to the commissioner of
revenue from the local government trust fund:
(1) homestead and agricultural credit aid to counties,
cities, towns, and special taxing districts under Minnesota
Statutes, section 273.1398;
(2) disparity reduction aid to counties, cities, towns, and
special taxing districts under Minnesota Statutes, section
273.1398;
(3) additional homestead and agricultural guarantee under
Minnesota Statutes, section 273.1398, subdivision 5;
(4) supplemental homestead property tax relief under
Minnesota Statutes, section 273.1391;
(5) disparity reduction credit under Minnesota Statutes,
section 273.1398, subdivision 4;
(6) a portion of state aid for county human services under
Minnesota Statutes, section 273.1398, subdivision 5a, determined
by the commissioner of finance. The commissioner shall
determine the portion as the sum of (i) the amount of trust fund
money appropriated for county human service aid in fiscal years
1992 and 1993 and (ii) 67 percent of the commissioner's forecast
of the increase in the receipts of the trust fund in fiscal
years 1994 and 1995 over fiscal years 1992 and 1993, less an
amount necessary to pay any increase in the estimated aid
payable under clauses (1) to (5), and (7) over that paid in
fiscal years 1992 and 1993;
(7) local government aid and equalization aid under
Minnesota Statutes, chapter 477A, if the advisory commission on
intergovernmental relations makes no recommendations to the
legislature for alternative local government aid formulas or
programs under Minnesota Statutes, section 3.862, subdivision 3
or the legislature fails to enact a recommendation of the
commission; and
(8) attached machinery aid to counties under Minnesota
Statutes, section 273.138.
(b) In addition, the legislature shall appropriate the rest
of the trust fund receipts for fiscal years 1994 and 1995 to
finance (1) intergovernmental aid formulas or programs
recommended by the advisory commission on intergovernmental
relations or (2) other aid formulas prescribed by law. *
(Section 4 was vetoed by the governor.)
Sec. 5. [273.1381] [LOCAL UNITS ELECTING OUT OF LOCAL
GOVERNMENT TRUST.]
(a) If a local option sales and use tax under section
297A.021 is not imposed in the county for the fiscal year, no
payments may be made out of the local government trust fund to
the county or to a city, town, or special taxing district
located in the county for the fiscal year, except as provided in
paragraph (b).
(b) If a city or special taxing district is located in two
or more counties and the local option tax is not imposed in one
or more of the counties, the city, town, or special taxing
district's aid payments from the local government trust fund
equal the amount of the aid multiplied by a fraction, the
numerator of which is the net tax capacity of the taxing
district in counties imposing the tax and the denominator of
which is the total net tax capacity of the taxing district.
Sec. 6. [297A.021] [LOCAL OPTION SALES TAX.]
Subdivision 1. [AUTHORIZATION.] (a) Notwithstanding
section 477A.016, a local sales and use tax may be imposed at a
rate of 0.5 percent on all sales at retail in the county.
(b) The rate imposed under paragraph (a) applies to the
purchase or acquisition of motor vehicles and is included in the
rate imposed by section 297B.02.
Subd. 2. [IMPOSITION.] (a) A county board may impose the
tax by adopting the authorizing resolution by July 1 and
notifying the commissioner in writing no later than July 15.
The tax applies to sales made after the next January 1.
(b) The action of the county board to impose the tax or the
failure of the county board to impose the tax may be reversed by
action of cities and towns in the county. The governing bodies
of cities and the boards of supervisors of towns containing a
majority of the county's population may reverse the imposition
or failure to impose the tax by adopting resolutions imposing or
reversing the imposition of the tax by August 1. Copies of the
resolutions must be filed with the county auditor by August 1
and the county auditor shall promptly notify the commissioner of
the action.
Subd. 3. [RESCISSION.] (a) A tax imposed under subdivision
2 continues in effect until rescinded. The county board may, by
resolution, rescind the tax. The governing bodies of the cities
and the boards of supervisors of towns containing a majority of
the county's population may, by resolution, reverse the county
board's rescission action or may act to rescind the tax if the
county board does not do so. Copies of the city and town board
resolutions must be filed with the county auditor.
(b) Effective in 1993, the county shall hold an election to
rescind the local option sales tax, if a rescission petition is
filed with the county. A rescission petition must be signed by
ten percent of the voters, determined on the basis of the last
general election, in each city and each town in the county. The
commissioner of revenue shall prepare the form of the question
to be presented at the election. If a majority of the voters
voting on the question approve, the tax is rescinded.
(c) The county auditor must promptly notify the
commissioner of a rescission of the tax. If the tax is
rescinded, the tax remains in effect through the next June 30
after the first August 1 after the notice of the rescission is
provided to the commissioner.
Subd. 4. [PUBLICATION IN STATE REGISTER.] The commissioner
of revenue shall publish in the State Register by November 1 of
each year a list of the counties imposing the local option sales
tax under this section.
Subd. 5. [ADMINISTRATION AND COLLECTION.] The taxes
imposed under this section shall be collected and administered
by the commissioner in the manner provided by this chapter and
chapters 289A and 297B.
Subd. 6. [DEFINITIONS.] (a) "City" includes both home rule
charter and statutory cities.
(b) "Population" means population as defined in section
477A.011.
Sec. 7. Minnesota Statutes 1990, section 297A.14, is
amended by adding a subdivision to read:
Subd. 3. [COUNTY USE TAX.] For each county in which a
sales tax is imposed under section 297A.021, a use tax is
imposed. This tax applies in the same manner and to the same
items as the tax under subdivision 1, except that the county is
substituted for the state of Minnesota and section 297A.021 is
substituted for section 297A.02.
Sec. 8. Minnesota Statutes 1990, section 297A.211,
subdivision 3, is amended to read:
Subd. 3. A person who pays the tax to the seller under
section 297A.03 or pays the tax to the motor vehicle registrar
as required by section 297B.02 and who meets the requirements of
this section at the time of the sale, except that the person has
not registered as a retailer under this section at the time of
the sale, may register as a retailer, make a return, and file
for a refund of the difference between the tax calculated under
section 297A.02, 297A.021, 297A.14, or 297B.02 and the tax
calculated under subdivision 2.
Sec. 9. Minnesota Statutes 1990, section 297A.24, is
amended to read:
297A.24 [TAXES IN OTHER STATES OR OTHER COUNTIES.]
Subdivision 1. [STATE TAX.] If any article of tangible
personal property or any item enumerated in section 297A.14 has
already been subjected to a tax by any other state in respect of
its sale, storage, use or other consumption in an amount less
than the tax imposed by sections 297A.01 to 297A.44, then as to
the person who paid the tax in such other state, the provisions
of section 297A.14 shall apply only at a rate measured by the
difference between the rate herein fixed sum of the rates
imposed under sections 297A.02 and 297A.021 and the rate by
which the previous tax was computed. If such tax imposed in
such other state was equal to or greater than the tax imposed in
this state, then no tax shall be due from such person under
section 297A.14.
Subd. 2. [COUNTY TAX.] If an item was subject to tax in
one county under section 297A.021 or 297A.14, subdivision 3, and
is used, stored, or consumed in another county imposing the tax
under section 297A.021, no tax shall apply under section
297A.14, subdivision 3.
Sec. 10. Minnesota Statutes 1990, section 297A.259, is
amended to read:
297A.259 [LOTTERY TICKETS; IN LIEU TAX.]
Sales of state lottery tickets are exempt from the tax
imposed under section 297A.02. The state lottery division in
the department of gaming must on or before the 20th day of each
month transmit to the commissioner of revenue an amount equal to
the gross receipts from the sale of lottery tickets for the
previous month multiplied by the combined tax rate under section
sections 297A.02, subdivision 1, and 297A.021, subdivision 1.
The resulting payment is in lieu of the sales tax that otherwise
would be imposed by this chapter. The commissioner shall
deposit the money transmitted in the general fund as provided by
section 297A.44 and the money must be treated as other proceeds
of the sales tax. Gross receipts for purposes of this section
mean the proceeds of the sale of tickets before deduction of a
commission or other compensation paid to the vendor or retailer
for selling tickets.
Sec. 11. Minnesota Statutes 1990, section 297A.44,
subdivision 1, is amended to read:
Subdivision 1. (a) Except as provided in paragraphs (b),
(c), and (d), and subdivision 4, all revenues, including
interest and penalties, derived from the excise and use taxes
imposed by sections 297A.01 to 297A.44 shall be deposited by the
commissioner in the state treasury and credited to the general
fund.
(b) All excise and use taxes derived from sales and use of
property and services purchased for the construction and
operation of an agricultural resource project, from and after
the date on which a conditional commitment for a loan guaranty
for the project is made pursuant to section 41A.04, subdivision
3, shall be deposited in the Minnesota agricultural and economic
account in the special revenue fund. The commissioner of
finance shall certify to the commissioner the date on which the
project received the conditional commitment. The amount
deposited in the loan guaranty account shall be reduced by any
refunds and by the costs incurred by the department of revenue
to administer and enforce the assessment and collection of the
taxes.
(c) All revenues, including interest and penalties, derived
from the excise and use taxes imposed on sales and purchases
included in section 297A.01, subdivision 3, paragraphs (d) and
(l), clauses (1) and (2), must be deposited by the commissioner
in the state treasury, and credited as follows:
(1) first to the general obligation special tax bond debt
service account in each fiscal year the amount required by
section 16A.661, subdivision 3, paragraph (b); and
(2) after the requirements of clause (1) have been met, the
balance must be credited to the general fund.
(d) The revenues, including interest and penalties, derived
from the taxes imposed on solid waste collection services as
described in section 297A.45, except for the tax imposed under
section 297A.021, shall be deposited by the commissioner in the
state treasury and credited to the general fund to be used for
funding solid waste reduction and recycling programs.
Sec. 12. Minnesota Statutes 1990, section 297A.44, is
amended by adding a subdivision to read:
Subd. 4. [LOCAL OPTION TAX.] (a) The commissioner shall
deposit all revenues, including interest and penalties, derived
from the local option excise taxes imposed under sections
297A.021 and 297A.14 in the local government trust fund.
(b) In addition, the commissioner shall deposit revenues
derived from imposing a rate of 1.5 percent on all taxable
sales, including interest and penalties, under this chapter in
the local government trust fund.
Sec. 13. Minnesota Statutes 1990, section 297A.45, is
amended to read:
297A.45 [SOLID WASTE COLLECTION AND DISPOSAL SERVICES.]
Subdivision 1. [DEFINITIONS.] The definitions in sections
115A.03 and 297A.01 apply to this section.
Subd. 2. [APPLICATION.] The tax taxes imposed by section
sections 297A.02 applies and 297A.021 apply to all public and
private mixed municipal solid waste collection and disposal
services. Notwithstanding section 297A.25, subdivision 11, a
political subdivision that purchases collection or disposal
services on behalf of its citizens shall pay the tax taxes. If
a political subdivision provides collection or disposal services
to its residents at a cost in excess of the total direct charge
to the residents for the service, the political subdivision
shall pay the tax taxes based on its cost of providing the
service in excess of the direct charges. A person who
transports mixed municipal solid waste generated by that person
or by another person without compensation shall pay the
tax taxes at the disposal or resource recovery facility based on
the disposal charge or tipping fee.
Subd. 3. [EXEMPTIONS.] (a) The cost of a service or the
portion of a service to collect and manage recyclable materials
separated from mixed municipal solid waste by the waste
generator is exempt from the tax taxes imposed in section
sections 297A.02 and 297A.021.
(b) The amount of a surcharge or fee imposed under section
115A.919, 115A.921, 115A.923, or 473.843 is exempt from the tax
taxes imposed in section sections 297A.02 and 297A.021.
(c) Waste from a recycling facility that separates or
processes recyclable materials and that reduces the volume of
the waste by at least 85 percent is exempt from the tax taxes
imposed in section sections 297A.02 and 297A.021. To qualify
for the exemption under this paragraph, the waste exempted must
be collected and disposed of separately from other solid waste.
Subd. 4. [CITY SALES TAX MAY NOT BE IMPOSED.]
Notwithstanding any other law or charter provision to the
contrary, a home rule charter or statutory city that imposes a
general sales tax may not impose the sales tax on solid waste
disposal and collection services that are subject to the tax
under this section. This subdivision does not apply to a tax
imposed under section 297A.021.
Sec. 14. Minnesota Statutes 1990, section 297B.09, is
amended by adding a subdivision to read:
Subd. 3. [LOCAL GOVERNMENT TRUST FUND
SHARE.] Notwithstanding subdivision 1, the commissioner of
revenue shall deposit in the local government trust fund all
revenues, including interest and penalties, derived from the
portion of the tax under this chapter attributable to (1) the
local option excise taxes under section 297A.021 and (2) a rate
of 1.5 percent.
Sec. 15. [TEMPORARY STATE SALES TAX INCREASE.]
Effective for purchases made after June 30, 1991, and
before January 1, 1992, each of the sales and use tax rates
under Minnesota Statutes, section 297A.02, and the motor vehicle
excise tax rate under section 297B.02 is increased by 0.5
percent.
Sec. 16. [TRANSFER TO LOCAL GOVERNMENT TRUST FUND.]
Each month the commissioner of finance shall transfer from
the general fund to the local government trust fund an amount of
money equal to revenues derived from imposing a tax rate of two
percent on taxable sales under Minnesota Statutes, chapter 297A,
and motor vehicle purchases after June 30, 1991, and before
January 1, 1992, as estimated by the commissioner of revenue.
Sec. 17. [REPEALER.]
If the legislature enacts the recommendations of the
advisory commission on intergovernmental relations under section
1, subdivision 3, Minnesota Statutes 1990, sections 477A.012,
477A.013, 477A.014, 477A.015, and 477A.03, are repealed.
Sec. 18. [EFFECTIVE DATE.]
Sections 1 to 11, 13, 15, and 16 are effective the day
following final enactment and the local sales tax provisions
apply to purchases made after December 31, 1991. Sections 12
and 14 are effective for purchases made after December 31,
1991. Section 17 is effective for aid paid in the second fiscal
year following the first submission of a recommendation of the
advisory commission on intergovernmental relations to the
legislature under section 1, subdivision 3, if the legislature
enacts the commission's recommendations.
ARTICLE 3
PROPERTY TAX AIDS AND CREDITS
Section 1. Minnesota Statutes 1990, section 273.1398,
subdivision 1, is amended to read:
Subdivision 1. [DEFINITIONS.] (a) In this section, the
terms defined in this subdivision have the meanings given them.
(b) "Unique taxing jurisdiction" means the geographic area
subject to the same set of local tax rates.
(c) "Gross tax capacity" means the product of the gross
class rates and estimated market values. "Total gross tax
capacity" means the gross tax capacities for all property within
the unique taxing jurisdiction. The total gross tax capacity
used shall be reduced by the sum of (1) the unique taxing
jurisdiction's gross tax capacity of commercial industrial
property as defined in section 473F.02, subdivision 3,
multiplied by the ratio determined pursuant to section 473F.08,
subdivision 6, for the municipality, as defined in section
473F.02, subdivision 8, in which the unique taxing jurisdiction
is located, (2) the gross tax capacity of the captured value of
tax increment financing districts as defined in section 469.177,
subdivision 2, and (3) the gross tax capacity of transmission
lines deducted from a local government's total gross tax
capacity under section 273.425. Gross tax capacity cannot be
less than zero.
(d) "Net tax capacity" means the product of (i) the
appropriate net class rates for the year in which the aid is
payable, except that for aids payable in 1991 the class rate
applied to class 3 utility real and personal property shall be
5.38 percent; the class rate applied to class 4c property and
that portion of class 3 property with an actual net class rate
of 2.3 percent shall be 2.4 percent; the class rates applied to
class 2a agricultural homestead property excluding the house,
garage, and one acre shall be .4 percent for the first $100,000
of value reduced by the value of the house, garage, and one
acre, 1.3 percent for the remaining value of the first 320
acres, and 1.7 percent for the remaining value of any acreage in
excess of 320 acres; the class rate applied to class 2b property
shall be 1.7 percent; the class rate applied to class 1b
property shall be .4 percent; and the class rate for the portion
of class 1 property and the house, garage, and one acre portion
of class 2a property with a market value in excess of $100,000
shall be 3.0 percent 1992 the class rate applied to class 4b
property shall be 2.9 percent; the class rate applied to class
4a property shall be 3.55 percent; the class rate applied to
noncommercial seasonal recreational residential property shall
be 2.25 percent; and the class rates applied to portions of
class 1a, 1b, and 2a property shall be 2 percent for the market
value between $68,000 and $110,000 and 2.5 percent for the
market value over $110,000; for aid payable in 1993 the class
rate applicable to class 4a shall be 3.5 percent; and the class
rate applicable to class 4b shall be 2.65; and for aid payable
in 1994 the class rate applicable to class 4b shall be 2.4
percent, and (ii) estimated market values for the assessment two
years prior to that in which aid is payable. The
reclassification of mobile home parks as class 4c shall not be
considered in determining net tax capacity for purposes of this
paragraph for aids payable in 1991 or 1992. The
reclassification of fraternity and sorority houses as class 4c
shall not be considered in determining net tax capacity for
purposes of this paragraph for aids payable in 1991. Any
reclassification of property by this act, shall not be
considered in determining net tax capacity for aids payable in
1992. "Total net tax capacity" means the net tax capacities for
all property within the unique taxing jurisdiction. The total
net tax capacity used shall be reduced by the sum of (1) the
unique taxing jurisdiction's net tax capacity of commercial
industrial property as defined in section 473F.02, subdivision
3, multiplied by the ratio determined pursuant to section
473F.08, subdivision 6, for the municipality, as defined in
section 473F.02, subdivision 8, in which the unique taxing
jurisdiction is located, (2) the net tax capacity of the
captured value of tax increment financing districts as defined
in section 469.177, subdivision 2, and (3) the net tax capacity
of transmission lines deducted from a local government's total
net tax capacity under section 273.425. For purposes of
determining the net tax capacity of property referred to in
clauses (1) and (2), the net tax capacity shall be multiplied by
the ratio of the highest class rate for class 3a property for
taxes payable in the year in which the aid is payable to the
highest class rate for class 3a property in the prior year. Net
tax capacity cannot be less than zero.
(e) "Previous net tax capacity" means the product of the
appropriate net class rates for the year previous to the year in
which the aid is payable, and estimated market values for the
assessment two years prior to that in which aid is payable.
"Total previous net tax capacity" means the previous net tax
capacities for all property within the unique taxing
jurisdiction. The total previous net tax capacity shall be
reduced by the sum of (1) the unique taxing jurisdiction's
previous net tax capacity of commercial-industrial property as
defined in section 473F.02, subdivision 3, multiplied by the
ratio determined pursuant to section 473F.08, subdivision 6, for
the municipality, as defined in section 473F.02, subdivision 8,
in which the unique taxing jurisdiction is located, (2) the
previous net tax capacity of the captured value of tax increment
financing districts as defined in section 469.177, subdivision
2, and (3) the previous net tax capacity of transmission lines
deducted from a local government's total net tax capacity under
section 273.425. Previous net tax capacity cannot be less than
zero.
(f) "Equalized market values" are market values that have
been equalized by dividing the assessor's estimated market value
for the second year prior to that in which the aid is payable by
the assessment sales ratios determined by class in the
assessment sales ratio study conducted by the department of
revenue pursuant to section 124.2131 in the second year prior to
that in which the aid is payable. The equalized market values
shall equal the unequalized market values divided by the
assessment sales ratio.
(g) "1989 local tax rate" means the quotient derived by
dividing the gross taxes levied within a unique taxing
jurisdiction for taxes payable in 1989 by the gross tax capacity
of the unique taxing jurisdiction for taxes payable in 1989.
For computation of the local tax rate for aid payable in 1991
and subsequent years, gross taxes for taxes payable in 1989
exclude equalized levies as defined in subdivision 2a. For
purposes of computation of the local tax rate only, gross taxes
shall not be adjusted by inflation or household growth.
(h) "Current local tax rate" means the quotient derived by
dividing the taxes levied within a unique taxing jurisdiction
for taxes payable in the year prior to that for which aids are
being calculated by the net tax capacity of the unique taxing
jurisdiction.
(i) For purposes of calculating the homestead and
agricultural credit aid authorized pursuant to subdivision 2,
the "subtraction factor" is the product of (i) a unique taxing
jurisdiction's 1989 local tax rate; (ii) its total net tax
capacity; and (iii) 0.9767.
(j) For purposes of calculating and allocating homestead
and agricultural credit aid authorized pursuant to subdivision 2
and the disparity reduction aid authorized in subdivision 3,
"gross taxes levied on all properties," "gross taxes," or "taxes
levied" means the total taxes levied on all properties except
that levied on the captured value of tax increment districts as
defined in section 469.177, subdivision 2, and that levied on
the portion of commercial industrial properties' assessed value
or gross tax capacity, as defined in section 473F.02,
subdivision 3, subject to the areawide tax as provided in
section 473F.08, subdivision 6, in a unique taxing
jurisdiction. Gross taxes levied on all properties or gross
taxes are before reduction by any credits for taxes payable in
1989. "Gross taxes" are before any reduction for disparity
reduction aid but "taxes levied" are after any reduction for
disparity reduction aid. Gross taxes levied or taxes levied
cannot be less than zero.
For homestead and agricultural credit aid payable in 1991,
"gross taxes" or "gross taxes levied on all properties" shall
mean gross taxes payable in 1989, excluding actual amounts
levied for the purposes listed in subdivision 2a, multiplied by
the cost-of-living adjustment factor and the household
adjustment factor.
"Taxes levied" excludes actual amounts levied for purposes
listed in subdivision 2a.
(k) "Human services aids" means:
(1) aid to families with dependent children under sections
256.82, subdivision 1, and 256.935, subdivision 1;
(2) medical assistance under sections 256B.041, subdivision
5, and 256B.19, subdivision 1;
(3) general assistance medical care under section 256D.03,
subdivision 6;
(4) general assistance under section 256D.03, subdivision
2;
(5) work readiness under section 256D.03, subdivision 2;
(6) emergency assistance under section 256.871, subdivision
6;
(7) Minnesota supplemental aid under section 256D.36,
subdivision 1;
(8) preadmission screening and alternative care grants
under section 256B.091;
(9) work readiness services under section 256D.051;
(10) case management services under section 256.736,
subdivision 13;
(11) general assistance claims processing, medical
transportation and related costs; and
(12) medical assistance, medical transportation and related
costs.
(l) "Cost-of-living adjustment factor" means the greater of
one or one plus the percentage increase in the consumer price
index minus .36 percent. In no case may the cost of living
adjustment factor exceed 1.0394.
(m) The percentage increase in the consumer price index
means the percentage, if any, by which:
(1) the consumer price index for the calendar year
preceding that in which aid is payable, exceeds
(2) the consumer price index for calendar year 1989.
(n) "Consumer price index for any calendar year" means the
average of the consumer price index as of the close of the
12-month period ending on May 31 of such calendar year.
(o) "Consumer price index" means the last consumer price
index for all-urban consumers published by the department of
labor. For purposes of the preceding sentence, the revision of
the consumer price index which is most consistent with the
consumer price index for calendar year 1989 shall be used.
(p) "Household adjustment factor" means the number of
households for the second most recent year preceding that in
which the aids are payable divided by the number of households
for the third most recent year. The household adjustment factor
cannot be less than one.
(q) "Growth adjustment factor" means the household
adjustment factor in the case of counties, cities, and towns.
In the case of school districts the growth adjustment factor
means the average daily membership of the school district under
section 124.17, subdivision 2, for the school year ending in the
second most recent year preceding that in which the aids are
payable divided by the average daily membership for the third
most recent year. In the case of special taxing districts, the
growth adjustment factor equals one. The growth adjustment
factor cannot be less than one.
(r) For aid payable in 1992 and subsequent
years, "homestead and agricultural credit base" means the
previous year's certified homestead and agricultural credit aid
determined under subdivision 2 less any permanent aid reduction
in the previous year to homestead and agricultural credit aid
under section 477A.0132, plus, for aid payable in 1992, fiscal
disparity homestead and agricultural credit aid under
subdivision 2b.
(s) "Net tax capacity adjustment" means (1) the total
previous net tax capacity minus the total net tax capacity,
multiplied by (2) the unique taxing jurisdiction's current local
tax rate. The net tax capacity adjustment cannot be less than
zero.
(t) "Fiscal disparity adjustment" means the difference
between (1) a taxing jurisdiction's fiscal disparity
distribution levy under section 473F.08, subdivision 3, clause
(a), for taxes payable in the year prior to that for which aids
are being calculated, and (2) the same distribution levy
multiplied by the ratio of the highest class rate for class 3
property for taxes payable in the year prior to that for which
aids are being calculated to the highest class rate for class 3
property for taxes payable in the second prior year to that for
which aids are being calculated. In the case of school
districts, the fiscal disparity distribution levy shall exclude
that part of the levy attributable to equalized school levies as
defined in subdivision 2a.
Sec. 2. Minnesota Statutes 1990, section 273.1398,
subdivision 3, is amended to read:
Subd. 3. [DISPARITY REDUCTION AID.] (a) For taxes payable
in 1990, and subsequent years, the amount of disparity aid
originally certified for each unique taxing jurisdiction for
taxes payable in the prior year shall be multiplied by the ratio
of (1) the jurisdiction's tax capacity using the class rates for
taxes payable in the year for which aid is being
computed, provided that the class rates for the portion of class
1a, 1b, and 2a property shall be 2 percent for the market value
between $68,000 and $110,000 and 2.5 percent for the market
value over $110,000, to (2) its tax capacity using the class
rates for taxes payable in the year prior to that for which aid
is being computed, both based upon market values for taxes
payable in the year prior to that for which aid is being
computed. For taxes payable in 1992 and subsequent years, the
amount of disparity aid certified to each taxing jurisdiction
shall be reduced by any reductions required in the current year
or permanent reductions required in previous years under section
477A.0132.
(b) The disparity reduction aid is allocated to each local
government levying taxes in the unique taxing jurisdiction in
the proportion that the local government's payable gross taxes
bears to the total payable gross taxes levied within the unique
taxing jurisdiction.
Sec. 3. Minnesota Statutes 1990, section 273.1398,
subdivision 5, is amended to read:
Subd. 5. [ADDITIONAL HOMESTEAD AND AGRICULTURAL CREDIT
GUARANTEE.] Beginning with taxes payable in 1990, each unique
taxing jurisdiction may receive additional homestead and
agricultural credit guarantee payments.
(1) Each year, the commissioner shall determine the total
education aids paid under chapters 124 and 124A, homestead and
agricultural credit aid and disparity reduction aid paid under
this section, local government aid to cities, counties, and
towns paid under chapter 477A, and human services aids,
including, for aids paid in 1991 and thereafter, the amount paid
under subdivision 5b, paid to counties for each taxing
jurisdiction. The commissioner shall apportion each local
government's governmental unit's aids to the unique taxing
jurisdiction each school district portion of each city and town
based upon the proportion that the unique taxing jurisdiction's
each school district portion of each city and town's tax
capacity bears to the total tax capacity of the local government
governmental unit. For purposes of this subdivision,
"governmental unit" includes counties, cities, towns, and school
districts, and excludes special taxing districts.
(2) Each year, the commissioner will compute a gross local
tax rate for each taxing jurisdiction equal to its total levy
divided by its gross tax capacity under Minnesota Statutes 1988,
section 273.13. For each unique taxing jurisdiction, a total
gross local tax rate will be determined. This total gross local
tax rate will be applied against the gross tax capacity of
property that would have been eligible for the homestead credit
or the agricultural credit for taxes payable in 1989. An
estimated credit amount will be determined for all qualifying
parcels based upon the credit rate structure in effect for taxes
payable in 1989. The resulting credit amounts will be summed
for all parcels in the unique taxing jurisdiction.
If the amount determined in clause (2) is greater less than
the amount determined in clause (1), of homestead credit and
agricultural credit received by all properties for taxes payable
in 1989 in the school district portion of each city or town, the
difference will be additional homestead and agricultural credit
guarantee payments for the unique taxing jurisdiction that
school district portion of the city or town in the following
taxes payable year. The additional credit amount shall
proportionately reduce the local tax rates of all local
governments governmental units levying taxes within the unique
taxing jurisdiction that school district portion of the city or
town in the following year. The commissioner shall certify the
amounts of additional credits determined under this subdivision
to the county auditor at the time provided in subdivision
6. For aid payable in 1992 and subsequent years, the aid
payable under this subdivision shall be reduced by any
reductions required in the current year and permanent reductions
required in previous years under section 477A.0132.
Sec. 4. Minnesota Statutes 1990, section 273.1398,
subdivision 7, is amended to read:
Subd. 7. [APPROPRIATION.] An amount sufficient to pay the
aids and credits provided under this section for school
districts, intermediate school districts, or any group of school
districts levying as a single taxing entity is annually
appropriated from the general fund to the commissioner of
revenue.
Sec. 5. Minnesota Statutes 1990, section 477A.011,
subdivision 27, as amended by Laws 1991, chapter 2, article 8,
section 2, is amended to read:
Subd. 27. [REVENUE BASE.] "Revenue base" means the amount
levied for taxes payable in 1991 in the previous year, including
the levy on the fiscal disparity distribution under section
473F.08, subdivision 3, paragraph (a), and before reduction for
the homestead and agricultural credit aid under section
273.1398, subdivision 2, equalization aid under section
477A.013, subdivision 5, and disparity reduction aid under
section 273.1398, subdivision 3; plus the originally certified
local government aid in the previous year under sections
477A.011;, 477A.012, subdivisions 1, 3, and 5, determined
without regard to subdivision 2; and 477A.013, subdivisions 1,
3, 6, and 7 except for 477A.013, subdivision 5; and the
estimated taconite aids used to determine levy limits for taxes
payable in 1991 the previous year under section 275.51,
subdivision 3i.
Sec. 6. Minnesota Statutes 1990, section 477A.011,
subdivision 28, as amended by Laws 1991, chapter 2, article 8,
section 3, is amended to read:
Subd. 28. [REDUCTION PERCENTAGE.] "Reduction percentage is
means the equal percentage reduction in each county and city
revenue affected local government's reduction base that is
estimated to be necessary to reduce 1990 the aid payments by
$28,000,000 under sections 477A.012, subdivision 5, and
477A.013, subdivision 7 to those local governments by the
amounts specified under section 477A.0132.
Sec. 7. Minnesota Statutes 1990, section 477A.011, is
amended by adding a subdivision to read:
Subd. 29. [ADJUSTED REVENUE BASE.] "Adjusted revenue base"
means revenue base as defined in subdivision 27 less the special
levy under section 275.50, subdivision 5, clause (a).
Sec. 8. Minnesota Statutes 1990, section 477A.012,
subdivision 1, as amended by Laws 1991, chapter 2, article 8,
section 4, is amended to read:
Subdivision 1. [AID AMOUNT.] In calendar year 1990, each
county government shall receive a distribution equal to the aid
amount certified for 1987 pursuant to this subdivision. Except
as provided in subdivision 6, in calendar year 1991 and
subsequent years, each county government shall receive a
distribution equal to the aid amount it received in 1990 under
this subdivision less the reduction made under subdivision
5. In calendar year 1991 and subsequent years, each county
government shall receive a distribution equal to the aid amount
it received under this subdivision in the previous year less any
permanent reductions made under section 477A.0132.
Sec. 9. Minnesota Statutes 1990, section 477A.013,
subdivision 1, as amended by Laws 1991, chapter 2, article 8,
section 6, is amended to read:
Subdivision 1. [TOWNS.] In calendar year 1989, each town
that has levied for taxes payable in 1988 at least one mill on
the dollar of the assessed value of the town shall receive a
distribution equal to 106 percent of the distribution received
under Minnesota Statutes 1987 Supplement, section 477A.013,
subdivision 1, in 1988. In calendar year 1990, each town that
had levied for taxes payable in the prior year a local tax rate
of at least .008 shall receive a distribution equal to 106
percent of the amount received in 1989 under this subdivision.
In calendar year 1991 and subsequent years, each town that had
levied for taxes payable in the prior year a local tax rate of
at least .008 shall receive a distribution equal to the amount
it received in 1990 the previous year under this subdivision
less the amount deducted in 1989 under subdivision 6 any
permanent reductions made under section 477A.0132.
Sec. 10. Minnesota Statutes 1990, section 477A.013,
subdivision 3, as amended by Laws 1991, chapter 2, article 8,
section 7, is amended to read:
Subd. 3. [CITY AID DISTRIBUTION.] In 1989, a city whose
initial aid is greater than $0 will receive the following aid
increases in addition to an amount equal to the local government
aid it received in 1988 under Minnesota Statutes 1987
Supplement, section 477A.013:
(1) for a city whose expenditure/unlimited aid ratio is at
least 1.5, two percent of city revenue;
(2) for a city whose expenditure/unlimited aid ratio is at
least 1.4 but less than 1.5, 2.5 percent of city revenue;
(3) for a city whose expenditure/unlimited aid ratio is at
least 1.3 but less than 1.4, three percent of city revenue;
(4) for a city whose expenditure/unlimited aid ratio is at
least 1.2 but less than 1.3, four percent of city revenue;
(5) for a city whose expenditure/unlimited aid ratio is at
least 1.1 but less than 1.2, five percent of city revenue;
(6) for a city whose expenditure/unlimited aid ratio is at
least 1.05 but less than 1.1, six percent of city revenue;
(7) for a city whose expenditure/unlimited aid ratio is at
least 1.0 but less than 1.05, seven percent of city revenue;
(8) for a city whose expenditure/unlimited aid ratio is at
least .95 but less than 1.0, 7.5 percent of city revenue;
(9) for a city whose expenditure/unlimited aid ratio is at
least .75 but less than .95, 8.5 percent of city revenue; and
(10) for a city whose expenditure/unlimited aid ratio is
less than .75, nine percent of city revenue.
In 1990, a city whose initial aid is greater than $0 will
receive an amount equal to the aid it received under this
section in the year prior to that for which aids are being
calculated plus an aid increase equal to 50 percent of the rates
listed in clauses (1) to (10) multiplied by city revenue.
In 1991 and subsequent years, a city will receive an amount
equal to the local government aid it received under this section
in the previous year except as provided in subdivision 8, less
any permanent reductions made under section 477A.0132.
A city's aid increase under this subdivision is limited to
the lesser of (1) 20 percent of its levy for taxes payable in
the year prior to that for which aids are being calculated, or
(2) its initial aid amount, or (3) 15 percent of the total local
government aid amount received under this section in the
previous year, provided that no city will receive an increase
that is less than two percent of its 1989 local government aid
for aids payable in 1990.
A city whose initial aid is $0 will receive in 1990 an
amount equal to 102 percent of the local government aid it
received in 1989 under Minnesota Statutes 1988, section
477A.013. A city whose initial aid is $0 will receive in 1991
an amount equal to the aid it received in the previous year
under this section. For purposes of this subdivision, the term
"local government aid" does not include equalization aid amounts
under subdivision 5.
Sec. 11. [477A.0132] [AID REDUCTIONS TO LOCAL
GOVERNMENTS.]
Subdivision 1. [AFFECTED LOCAL GOVERNMENTS.] The following
permanent and nonpermanent reductions shall be made in aids paid
to the following local units of government:
(a) For aids payable in 1990, there shall be a permanent
reduction in aids to counties and cities of $28,000,000.
(b) For aids payable on July 20, 1991, there shall be a
nonpermanent reduction in aid payments to counties, cities,
towns, and special taxing districts of $50,000,000.
(c) For aids payable on December 15, 1991, there shall be a
nonpermanent reduction in aids to counties, cities, towns, and
special taxing districts of $35,000,000. For purposes of this
reduction, hospital districts are not considered special taxing
districts.
(d) For aids payable in 1992, there shall be a permanent
reduction in aids to counties, cities, and special taxing
districts of $86,000,000. For purposes of this reduction,
hospital districts are not considered special taxing districts.
(e) For aid reductions required under section 477A.014,
subdivision 1a, there shall be a nonpermanent reduction in aids
to counties, cities, towns, and special taxing districts equal
to the difference between the aid amounts certified to be paid
and the amount appropriated under article 2, section 3, to pay
the aids.
Subd. 2. [CALCULATION OF AID REDUCTION.] The aid reduction
to each local government as provided under subdivision 1 will be
equal to the product of the reduction percentage and its
reduction base. The reduction base is defined as the following:
(a) For subdivision 1, clause (a), the reduction base is
equal to the adjusted revenue base for 1991.
(b) For subdivision 1, clause (b), the reduction base is
equal to the revenue base for 1992.
(c) For subdivision 1, clause (c) the reduction base is
equal to the adjusted revenue base for 1992.
(d) For subdivision 1, clause (d), the reduction base is
equal to the adjusted revenue base for 1992.
(e) For subdivision 1, clause (e), the reduction base is
equal to the adjusted revenue base for the year in which the aid
payment is to be made.
Subd. 3. [ORDER OF AID REDUCTIONS.] The aid reduction to a
local government as calculated under subdivisions 1 and 2, is
first applied to its local government aid under sections
477A.012 and 477A.013 excluding aid under section 477A.013,
subdivision 5; then, if necessary, to its equalization aid under
section 477A.013, subdivision 5; then if necessary, to its
homestead and agricultural credit aid under section 273.1398,
subdivision 2; and then, if necessary, to its disparity
reduction aid under section 273.1398, subdivision 3; and then,
if necessary, to its homestead and agricultural credit guarantee
under section 273.1398, subdivision 5. No aid payment may be
less than $0. Aid reductions under this section in any given
year shall be divided equally between the July 20 and December
15 aid payments unless specified otherwise in subdivision 1.
Sec. 12. Minnesota Statutes 1990, section 477A.014,
subdivision 1, as amended by Laws 1991, chapter 2, article 8,
section 10, is amended to read:
Subdivision 1. [CALCULATIONS AND PAYMENTS.] The
commissioner of revenue shall make all necessary calculations
and make payments pursuant to sections 477A.012,
477A.013, 477A.0132, and 477A.03 directly to the affected taxing
authorities annually. In addition, the commissioner shall
notify the authorities of their aid amounts, as well as the
computational factors used in making the calculations for their
authority, and those statewide total figures that are pertinent,
before August 15 of the year preceding the aid distribution
year, except that for aid payable in 1990 the commissioner of
revenue must notify the authorities of their aid amounts as well
as the computational factors used in the calculation before
October 23, 1989. The commissioner shall reduce the July 20,
1991, payment of local government aid, equalization aid,
homestead and agricultural credit aid, and disparity reduction
aid to counties, cities, towns, and special taxing districts by
a combined amount of $50,000,000.
Sec. 13. Minnesota Statutes 1990, section 477A.014, is
amended by adding a subdivision to read:
Subd. 1a. [ADJUSTMENTS FOR LOCAL GOVERNMENT TRUST FUND
REVENUES.] For aids payable in 1991 and 1992 only, if the amount
appropriated under article 2, section 3, for homestead and
agricultural credit aid and disparity reduction aid under
section 273.1398, and local government aid and equalization aid
under sections 477A.011 to 477A.013, and the additional
homestead and agricultural credit guarantee under section
273.1398, subdivision 5, is less than or greater than the
amounts certified to be paid by the commissioner of revenue, the
aids will be reduced or increased in the following manner unless
otherwise provided for in law.
In the case of an aid reduction, each city's, county's,
town's, and special taxing district's aids will be reduced as
provided for in section 477A.0132. In the case of an aid
increase, each city's, county's, town's, and special taxing
district's aid shall be increased proportionately. The aid
reduction or increase will be split equally between the July 20
and December aid payments each year.
If the commissioner estimates an additional reduction or
increase in appropriations for these programs after the July 20
aid payment but before the December payment, the December aid
payments to local governments for these programs will be reduced
or increased proportionately.
Sec. 14. Minnesota Statutes 1990, section 477A.03,
subdivision 1, is amended to read:
Subdivision 1. [ANNUAL APPROPRIATION.] A sum sufficient to
discharge the duties imposed by sections 477A.011 to 477A.014 is
annually appropriated from the general local government trust
fund to the commissioner of revenue. For aids payable in 1991
and thereafter, the total amount of equalization aid paid under
section 477A.013, subdivision 5, is limited to $19,485,684.
Sec. 15. [REPEALER.]
Minnesota Statutes 1990, sections 477A.012, subdivision 5;
and 477A.013, subdivision 7; Laws 1990, chapter 604, article 4,
section 19; Laws 1991, chapter 2, article 8, sections 5, 8, and
9, are repealed.
Sec. 16. [EFFECTIVE DATES.]
This article is effective for aids payable in 1991 and
subsequent years.
ARTICLE 4
LEVY LIMITS
Section 1. Minnesota Statutes 1990, section 275.125, is
amended by adding a subdivision to read:
Subd. 6j. [LEVY FOR CRIME RELATED COSTS.] For taxes levied
in 1991, payable in 1992 only, each school district may make a
levy on all taxable property located within the school district
for the purposes specified in this subdivision. The maximum
amount which may be levied for all costs under this subdivision
shall be equal to $1 multiplied by the population of the school
district. For purposes of this subdivision, "population" of the
school district means the same as contained in section 275.14.
The proceeds of the levy must be used for reimbursing the cities
and counties who contract with the school district for the
following purposes: (1) to pay the costs incurred for the
salaries, benefits, and transportation costs of peace officers
and sheriffs for liaison services in the district's middle and
secondary schools, (2) to teach drug abuse resistance education
curricula in the elementary schools, and (3) to pay the costs
incurred for the salaries and benefits of peace officers and
sheriffs whose primary responsibilities are to investigate
controlled substance crimes under chapter 152. The school
district must initially attempt to contract for these services
with the police department of each city or the sheriff's
department of the county within the school district containing
the school receiving the services. If a local police department
or a county sheriff's department does not wish to provide the
necessary services, the district may contract for these services
with any other police or sheriff's department located entirely
or partially within the school district's boundaries. The levy
authorized under this subdivision is not included in determining
the school district's levy limitations and must be disregarded
in computing any overall levy limitations under sections 275.50
to 275.56 of the participating cities or counties.
Sec. 2. Minnesota Statutes 1990, section 275.50,
subdivision 5, is amended to read:
Subd. 5. Notwithstanding any other law to the contrary for
taxes levied in 1990 payable in 1991 and subsequent years,
"special levies" means those portions of ad valorem taxes levied
by governmental subdivisions to:
(a) for taxes levied in 1990, payable in 1991 and
subsequent years, pay the costs not reimbursed by the state or
federal government, of payments made to or on behalf of
recipients of aid under any public assistance program authorized
by law, and the costs of purchase or delivery of social services.
The aggregate amounts levied under this clause for the costs of
purchase or delivery of social services and income maintenance
programs, other than those identified in section 273.1398,
subdivision 1, paragraph (i) (k), are subject to a maximum
increase over the amount levied for the previous year of 12
percent for counties within the metropolitan area as defined in
section 473.121, subdivision 2, or counties outside the
metropolitan area but containing a city of the first class, and
15 percent for other counties. For purposes of this clause,
"income maintenance programs" include income maintenance
programs in section 273.1398, subdivision 1, paragraph (i) (k),
to the extent the county provides benefits under those programs
over the statutory mandated standards. Effective with taxes
levied in 1990, the portion of this special levy for human
service programs identified in section 273.1398, subdivision 1,
paragraph (i) (k), is eliminated. For taxes levied in 1991, the
amount levied under this clause may be increased by an amount
equal to county costs that are not reimbursed by the state for
emergency assistance under section 256.871, emergency general
assistance under section 256D.06, subdivision 2, and Minnesota
supplemental aid and general assistance negotiated rate payments
under section 256I.04;
(b) pay the costs of principal and interest on bonded
indebtedness except on bonded indebtedness issued under section
471.981, subdivisions 4 to 4c, or to reimburse for the amount of
liquor store revenues used to pay the principal and interest due
in the year preceding the year for which the levy limit is
calculated on municipal liquor store bonds;
(c) pay the costs of principal and interest on certificates
of indebtedness, except tax anticipation or aid anticipation
certificates of indebtedness, issued for any corporate purpose
except current expenses or funding an insufficiency in receipts
from taxes or other sources or funding extraordinary
expenditures resulting from a public emergency; and to pay the
cost for certificates of indebtedness issued pursuant to under
sections 298.28 and 298.282;
(d) fund the payments made to the Minnesota state armory
building commission pursuant to under section 193.145,
subdivision 2, to retire the principal and interest on armory
construction bonds;
(e) provide for the bonded indebtedness portion of payments
made to another political subdivision of the state of Minnesota;
(f) pay the amounts required, in accordance with section
275.075, to correct for a county auditor's error of omission but
only to the extent that when added to the preceding year's levy
it is not in excess of an applicable statutory, special law or
charter limitation, or the limitation imposed on the
governmental subdivision by sections 275.50 to 275.56 in the
preceding levy year;
(g) pay amounts required to correct for an error of
omission in the levy certified to the appropriate county auditor
or auditors by the governing body of a city or town with
statutory city powers in a levy year, but only to the extent
that when added to the preceding year's levy it is not in excess
of an applicable statutory, special law or charter limitation,
or the limitation imposed on the governmental subdivision by
sections 275.50 to 275.56 in the preceding levy year;
(h) pay amounts required by law to be paid to pay the
interest on and to reduce the unfunded accrued liability of
public pension funds in accordance with the actuarial standards
and guidelines specified in sections 356.215 and 356.216 reduced
by 106 percent of the amount levied for that purpose in 1976,
payable in 1977. For the purpose of this special levy, the
estimated receipts expected from the state of Minnesota pursuant
to sections 69.011 to 69.031 or any other state aid expressly
intended for the support of public pension funds shall be
considered as a deduction in determining the required levy for
the normal costs of the public pension funds. No amount of
these aids shall be considered as a deduction in determining the
governmental subdivision's required levy for the reduction of
the unfunded accrued liability of public pension funds;
(i) to compensate the state for the cost of a reassessment
ordered by the commissioner of revenue pursuant to under section
270.16;
(j) (i) pay the debt service on tax increment financing
revenue bonds to the extent that revenue to pay the bonds or to
maintain reserves for the bonds is insufficient as a result of
the provisions of Laws 1988, chapter 719, article 5, provided
that an appeal for the levy under this clause was approved by
the commissioner of revenue under section 275.51, subdivision
3j;
(k) (j) pay the cost of hospital care under section 261.21;
(l) (k) pay the unreimbursed costs incurred in the previous
year to satisfy judgments rendered against the governmental
subdivision by a court of competent jurisdiction in any tort
action, or to pay the costs of settlements out of court against
the governmental subdivision in a tort action when substantiated
by a stipulation for the dismissal of the action filed with the
court of competent jurisdiction and signed by both the plaintiff
and the legal representative of the governmental subdivision,
provided that an appeal for the unreimbursed costs under this
clause was approved by the commissioner of revenue under section
275.51, subdivision 3 3j;
(m) (l) pay the expenses reasonably and necessarily
incurred in preparing for or repairing the effects of natural
disaster including the occurrence or threat of widespread or
severe damage, injury, or loss of life or property resulting
from natural causes such as earthquake, fire, flood, wind storm,
wave action, oil spill, water contamination, air contamination,
or drought in accordance with standards formulated by the
emergency services division of the state department of public
safety, provided that an appeal for the expenses incurred under
this clause were approved by the commissioner of revenue under
section 275.51, subdivision 3 3j;
(n) (m) pay a portion of the losses in tax receipts to a
city due to tax abatements or court actions in the year
preceding the current levy year, provided that an appeal for the
tax losses was approved by the commissioner of revenue under
section 275.51, subdivision 3 3j. This special levy is limited
to the amount of the losses times the ratio of the nonspecial
levies to total levies for taxes payable in the year the
abatements were granted. County governments are not authorized
to claim this special levy;
(o) (n) pay the operating cost of regional library services
authorized under section 134.34, subject to a maximum increase
over the previous year of the greater of (1) 103 percent
multiplied by one plus the percentage increase determined for
the governmental subdivision under section 275.51, subdivision
3h, clause (b), or (2) six percent. If a governmental
subdivision elected to include some or all of its levy for
libraries within its adjusted levy limit base in the prior year,
but elects to claim the levy as a special levy in the current
levy year, the allowable increase is determined by applying the
greater percentage determined under clause (1) or (2) to the
total amount levied for libraries in the prior levy year. After
levy year 1989, the increase must not be determined using a base
amount other than the amount that could have been levied as a
special levy in the prior year. This limit may be redistributed
according to the provisions of section 134.342. In no event
shall the special levy be less than the minimum levy required
under sections 134.33 and 134.34, subdivisions 1 and 2;
(p) (o) pay the amount of the county building fund levy
permitted under section 373.40, subdivision 6;
(q) (p) pay the county's share of the costs levied in 1989,
1990, and 1991 for the Minnesota cooperative soil survey under
Minnesota Statutes 1988, section 40.07, subdivision 15, provided
that the amount levied in 1991 under this clause does not exceed
the amount levied under this clause in 1990;
(r) for taxes levied in 1989, payable in 1990 only, pay the
cost incurred for the minimum share required by counties levying
for the first time under section 134.34 as required under
section 134.341. For taxes levied in 1990, and thereafter,
counties levying under this provision must levy under clause
(o), and their allowable increase must be determined with
reference to the amount levied in 1989 under this paragraph;
(s) for taxes levied in 1989, payable in 1990 only, provide
an amount equal to 50 percent of the estimated amount of the
reduction in aids to a county under sections 273.1398,
subdivision 2, paragraph (d), and 477A.012, subdivision 3, for
aids payable in 1990;
(t) for taxes levied in 1990 only by a county in the eighth
judicial district, provide an amount equal to the amount of the
levy, if any, that is required under Laws 1989, chapter 335,
article 3, section 54, subdivision 8, as amended by Laws 1990,
chapter 604, article 9, section 14;
(u) (q) for taxes levied in 1989, payable in 1990 only, pay
the costs not reimbursed by the state or federal government:
(i) for the costs of purchase or delivery of social
services. The aggregate amounts levied under this item are
subject to a maximum increase over the amount levied in the
previous year of 12 percent for counties within the metropolitan
area as defined in section 473.121, subdivision 2, or counties
outside the metropolitan area but containing a city of the first
class, and 15 percent for other counties.
(ii) for payments made to or on behalf of recipients of aid
under any public assistance program authorized by law. The
aggregate amounts levied under this item are subject to a
maximum increase over the amount levied in the previous year of
12 percent and must be used only for the public assistance
programs.
(iii) If the amount levied under this paragraph (u) clause
(ii) in 1989 for public assistance programs is less than the
actual expenditures needed for these programs for 1990, the
difference between the actual expenditures and the amount levied
may be levied in 1990 as a special levy. If the amount
levied under clause (ii) in 1989 for public assistance programs
is greater than the actual expenditures needed for these
programs for 1990, the difference between the amount levied and
the actual expenditures shall be deducted from the 1990 levy
limit, payable in 1991;
(v) pay an amount of up to 25 percent of the money sought
for distribution and approved under section 115A.557,
subdivision 3, paragraph (b), clause (3);
(w) (r) pay the unreimbursed costs of per diem jail or
correctional facilities services paid by the county in the
previous 12-month period ending on July 1 of the current year
provided that the county is operating under a department of
corrections directive that limits the capacity of a county jail
as authorized in section 641.01 or 641.262, or a correctional
facility as defined in section 241.021, subdivision 1, paragraph
(5);
(x) (s) for taxes levied in 1990 and 1991, payable in 1991
and 1992 only, pay the operating or maintenance costs of a
county jail as authorized in section 641.01 or 641.262, or of a
correctional facility as defined in section 241.021, subdivision
1, paragraph (5), to the extent that the county can demonstrate
to the commissioner of revenue that the amount has been included
in the county budget as a direct result of a rule, minimum
requirement, minimum standard, or directive of the department of
corrections. If the county utilizes this special levy, any
amount levied by the county in the previous levy year for the
purposes specified under this clause and included in the
county's previous year's levy limitation computed under section
275.51, shall be deducted from the levy limit base under section
275.51, subdivision 3f, when determining the county's current
year levy limitation. The county shall provide the necessary
information to the commissioner of revenue for making this
determination;
(y) for taxes levied in 1990, payable in 1991 only, pay an
amount equal to the unreimbursed county costs paid in 1989 and
1990 for the purpose of grasshopper control; and, (t) for taxes
levied in 1991 payable in 1992 only, pay an amount equal to the
unreimbursed county costs paid in 1991 for the purpose of
grasshopper control;
(z) (u) for a county, provide an amount needed to fund
comprehensive local water implementation activities under
sections 103B.3361 to 103B.3369 as provided in this clause.
A county may levy an amount not to exceed the water
implementation local tax rate times the adjusted net tax
capacity of the county for the preceding year. The water
implementation local tax rate shall be set by August 1 each year
by the commissioner of revenue for taxes payable in the
following year. As used in this paragraph, the "adjusted net
tax capacity of the county" means the net tax capacity of the
county as equalized by the commissioner of revenue based upon
the results of an assessment/sales ratio study. That rate shall
be the rate, rounded up to the nearest one-thousandth of a
percent, that, when applied to the adjusted net tax capacity for
all counties, raises the amount specified in this clause. The
water implementation local tax rate for taxes levied in 1990
shall be the rate that raises $1,500,000 and the rate for taxes
levied in 1991 shall be the rate that raises $1,500,000. A
county must levy a tax at the rate established under this clause
to qualify for a grant from the board of water and soil
resources under section 103B.3369, subdivision 5;
(aa) (v) pay the unreimbursed county costs for
court-ordered family-based services and court-ordered
out-of-home placement for children to the extent that the county
can demonstrate to the commissioner of revenue that the
estimated amount included in the county's budget for the
following levy year is for the purposes specified under this
clause. For purposes of this special levy, costs for
"family-based services" and "out-of-home placement" means costs
resulting from court-ordered targeted family services designed
to avoid out-of-home placement and from court-ordered
out-of-home placement under the provisions of sections 260.172
and 260.191, which are unreimbursed by the state or federal
government, insurance proceeds, or parental or child
obligations. Any amount levied under this clause must only be
used by the county for the purposes specified in this clause.
If the county uses this special levy and the county levied
an amount in the previous levy year, for the purposes specified
under this clause, under another special levy or under the levy
limitation in section 275.51, the following adjustments must be
made:
(i) The amount levied in the previous levy year for the
purposes specified under this clause under the levy limitation
in section 275.51 must be deducted from the levy limit base
under section 275.51, subdivision 3f, when determining the
current year levy limitation.
(ii) The amount levied in the previous levy year, for the
purposes specified under clause (a) or (u) must be deducted from
the previous year's amount used to calculate the maximum amount
allowable under clause (a) in the current levy year; and
(bb) (w) pay the amounts allowed as special levies under
Laws 1989, First Special Session chapter 1, article 5, section
50, and subdivisions subdivision 5a and 5b.;
(x) for taxes levied in 1991 only by a county, pay the
costs reasonably expected to be incurred in 1992 related to the
redistricting of election districts and establishment of
election precincts under sections 204B.135 and 204B.14, the
notice required by section 204B.14, subdivision 4, and the
reassignment of voters in the statewide registration system, not
to exceed $1 per capita, provided that the county shall
distribute a portion of the amount levied under this clause
equal to 25 cents times the population of the city to all cities
within the county with a population of 30,000 or greater;
(y) for taxes levied in 1991, payable in 1992 only, provide
an amount equal to 50 percent of the estimated amount of the
reduction in aids payable in 1992 under section 477A.012,
subdivision 7, to a county located in the third or sixth
judicial district for public defense services in juvenile and
misdemeanor cases; and
(z) for taxes levied in 1991, payable in 1992 only, provide
an amount equal to 50 percent of the estimated amount of
reduction in aids payable in 1992 under section 477A.012,
subdivision 7, to a county for the cost of jury fees.
Sec. 3. Minnesota Statutes 1990, section 275.50,
subdivision 5a, as amended by Laws 1991, chapter 3, section 1,
is amended to read:
Subd. 5a. [SPECIAL LEVIES; LOCAL.] "Special levies" also
includes those portions of ad valorem taxes levied by the
following governmental subdivisions for the years and purposes
given in the cited laws:
(1) Goodhue county for the county historical society as
provided in Laws 1990, chapter 604, article 3, section 50;
(2) the city of Windom for a municipal hospital as provided
in Laws 1990, chapter 604, article 3, section 51;
(3) Koochiching county for ambulance service as provided in
Laws 1990, chapter 604, article 3, section 52;
(4) Douglas county for solid waste management as provided
in Laws 1990, chapter 604, article 3, section 53;
(5) the city of Bemidji and Beltrami county to pay bonds
for an airport terminal as provided in Laws 1990, chapter 604,
article 3, section 57;
(6) Ramsey county to pay bonds for a facility for the arts
and sciences as provided in Laws 1990, chapter 604, article 3,
section 58;
(7) the city of Rosemount for an armory as provided in Laws
1990, chapter 604, article 3, section 59;
(8) the cities of Maple Grove, Brooklyn Park, Brooklyn
Center, and Coon Rapids for peace officer salaries and benefits
as provided in Laws 1990, chapter 604, article 3, section 60;
(9) a city described in and for debt service as provided in
Laws 1990, chapter 604, article 3, section 61; and
(10) Mahnomen county and the city of Mahnomen for the
Mahnomen county and village hospital as provided in sections 2
and 3;
(11) Itasca county for economic development under Laws
1989, First Special Session chapter 1, article 5, section 50, as
amended by section 11;
(12) Pope county for solid waste management as provided in
section 14;
(13) Swift county for social services as provided in
section 15;
(14) Mille Lacs county for social services as provided in
section 16;
(15) Great River Regional Library as provided in section
21; and
(16) Meeker county for social services as provided in
section 25.
Sec. 4. Minnesota Statutes 1990, section 275.51,
subdivision 3f, is amended to read:
Subd. 3f. [LEVY LIMIT BASE.] (a) The property tax levy
limit base for governmental subdivisions for taxes levied in
1988 shall be equal to the total actual levy for taxes payable
in 1988 with additions and subtractions as specified in
paragraphs (b) and (c).
(b) The amounts to be added to the actual 1988 levy are (1)
the amount of local government aid the governmental subdivision
was certified to receive in 1988 under sections 477A.011 to
477A.014, (2) its 1988 taconite aids under sections 298.28 and
298.282, and (3) its 1988 wetlands and native prairie
reimbursements under Minnesota Statutes 1986, sections 273.115,
subdivision 3, and 273.116, subdivision 3.
(c) The amounts to be subtracted from the actual 1988 levy
are (1) any special levies claimed for taxes payable in 1988
pursuant to Laws 1987, chapter 268, article 5, section 12,
subdivision 4, clauses (1), (2), (3), and (4); and (2) for a
governmental subdivision participating in a regional library
system receiving grants from the department of education under
section 134.34, the amount levied for taxes payable in 1988 for
the operating costs of a public library service.
(d) For taxes levied in 1989 1991 and subsequent years, a
governmental subdivision's levy limit base is equal to its
adjusted levy limit base for the preceding year, provided that
for taxes levied in 1989, the amount of the administrative
reimbursement aid received in 1988 shall be added to the base.
(e) For taxes levied by a county in 1989, the levy limit
base determined under paragraph (d) shall be reduced by an
amount equal to 90 percent of the cost of public defender
services for felonies and gross misdemeanors and the costs of
law clerks in the county that are assumed by the state during
calendar year 1990, less 103 percent of one-half the amount of
fees collected by the courts in the county during calendar year
1988. For taxes levied in 1990, the levy limit base determined
under paragraph (d) shall first be increased by the product of
(1) the amount deducted under this paragraph for taxes levied in
1989 and (2) the adjustments under subdivision 3h, paragraphs
(a) and (b) for taxes levied in 1989, and then shall be reduced
by an amount equal to the cost of public defender services for
felonies and gross misdemeanors and the cost of law clerks in
the county that are assumed by the state during calendar year
1991, less the amount of fees collected by the courts in the
county during calendar year 1989, computed at the rate of $30
for civil and probate filings and $20 for marriage dissolutions.
(f) (b) For taxes levied in 1989 by a county that is
located in the eighth judicial district, the levy limit base
determined under paragraphs (d) and (e) shall be further reduced
by an amount equal to 90 percent of the cost of operation of the
trial courts in the county during calendar year 1990 that are
assumed by the state and for which an appropriation is provided,
less 103 percent of the sum of (1) the remaining one-half of the
amount of fees and (2) 100 percent of the amount of fines
collected by the courts in the county during calendar year
1988. For taxes levied in 1990 by a county that is located in
the eighth judicial district, the levy limit base determined
under Minnesota Statutes 1990, section 275.51, subdivision 3f,
paragraphs (d) and (e), is reduced by the product of (1) 103
percent of one-half of the fees collected by the courts in the
county during calendar year 1988, and (2) the adjustments under
subdivision 3h, paragraphs (a) and (b), for taxes levied in 1989.
(g) By October 15, 1989, the board of public defense shall
determine and certify to the commissioner of revenue the pro
rata share for each county of the state-financed public defense
services described in paragraph (e) during the six-month period
beginning July 1, 1990. By October 15, 1989, the supreme court
shall determine and certify to the department of revenue for
each county the pro rata share for each county of the cost of
providing law clerks during the three-month period beginning
October 1, 1990, plus, for each county located in the eighth
judicial district, the cost of operation of the trial courts
during calendar year 1990.
By July 15, 1990, the board of public defense shall
determine and certify to the department of revenue the pro rata
share for each county of the state-financed public defense
services described in paragraph (e) during calendar year 1991.
By July 15, 1990, the supreme court shall determine and certify
to the department of revenue for each county the pro rata share
for each county of the cost of providing law clerks during
calendar year 1991 plus, for each county located in the eighth
judicial district, the cost of operation of the trial courts
during the first six months of 1991.
(h) (c) For taxes levied in a county in 1991, the levy
limit base shall be reduced by an amount equal to the cost in
the county of court reporters, judicial officers, and district
court referees and the expenses of law clerks and court
reporters as authorized in sections 484.545, subdivision 3, and
486.05, subdivisions 1 and 1a, as certified by the supreme court
pursuant to section 477A.012, subdivision 4.
(i) If a governmental subdivision received an adjustment to
its levy limit base for taxes levied in 1988 under section
275.51, subdivision 3j, its levy limit base for taxes levied in
1989 must be reduced by the lesser of (1) the adjustment under
section 275.51, subdivision 3j, or (2) the difference between
its (i) levy limit for taxes levied in 1988 and its (ii) total
actual levy for taxes levied in 1988 minus any special levies
claimed for taxes levied in 1988 under section 275.50,
subdivision 5.
(d) For taxes levied in 1991 in a county that is located in
the third or sixth judicial districts, the levy limit base shall
be reduced by an amount equal to the reduction in aids payable
in 1992 for the cost of public defense services in juvenile and
misdemeanor cases in the county as certified by the board of
public defense under section 477A.012, subdivision 7.
(e) For taxes levied in 1991, the county's levy limit base
shall be reduced by an amount equal to the reduction in aids
payable in 1992 for the cost in the county of jury fees as
certified by the supreme court under section 477A.012,
subdivision 7.
(f) For taxes levied in 1991, the levy limit base shall be
increased by the amounts levied in 1990 under Minnesota Statutes
1990, section 275.50, subdivision 5, clauses (h) and (v).
Sec. 5. Minnesota Statutes 1990, section 275.51,
subdivision 3h, is amended to read:
Subd. 3h. [ADJUSTED LEVY LIMIT BASE.] For taxes levied in
1989 1991 and thereafter, the adjusted levy limit base is equal
to the levy limit base computed pursuant to under subdivision
3f, increased by:
(a) three percent for taxes levied in 1989 and subsequent
years;
(b) a percentage equal to (1) one-half of the greater of
the percentage increases in population or in number of
households, if any, for cities and towns and (2) the lesser of
the percentage increase in population or the number of
households, if any, for counties, using figures derived pursuant
to subdivision 6;
(c) the amount of a permanent increase in the levy limit
base approved at a general or special election held during the
12-month period ending four working days after December 20 of
the levy year under section 275.58, subdivisions 1 and 2;.
(d) for levy year 1989, for a county which incurred costs
since October 1978, for the litigation of federal land claims
under United States Code, title 18, section 1162; United States
Code, title 25, section 331; and United States Code, title 28,
section 1360; an amount of up to the actual costs incurred by
the county for this purpose. This adjustment shall not exceed
$250,000;
(e) for levy year 1989, an amount of $1,724,000 for Ramsey
county for implementing the local government pay equity act
under sections 471.991 to 471.999. Furthermore, in levy years
1990 and 1991, an additional amount of $862,000 shall be added
to Ramsey county's adjusted levy limit base under this clause
for each of the two years; and
(f) for levy year 1989, an amount equal to the decrease in
a county's 50 percent share of the powerline taxes extended
between taxes payable years 1988 and 1989 under section 273.42,
subdivision 1. The adjustment shall be determined by the
department of revenue.
For taxes levied in 1989, the adjusted levy limit base is
reduced by an amount equal to the estimated amount of the
reduction in aids to a county under sections 273.1398,
subdivision 2, paragraph (d), and 477A.012, subdivision 3, for
aids payable in 1990.
For taxes levied in 1990, the adjusted levy limit base of a
city is reduced by an amount equal to the percent of the city's
revenue base used in determining aid reductions under section
477A.013, subdivision 7. For taxes levied in 1990, the adjusted
levy limit base of a county is reduced by one-half of the amount
equal to the percent of the county's revenue base used in
determining aid reductions under section 477A.012, subdivision 5.
Sec. 6. Minnesota Statutes 1990, section 275.51,
subdivision 3j, is amended to read:
Subd. 3j. [APPEALS.] (a) A county may appeal to the
commissioner of revenue for an adjustment in its levy limit
base. If the county can provide evidence satisfactory to the
commissioner that its levy for taxes payable in 1989 under
Minnesota Statutes 1988, section 275.50, subdivision 5,
paragraph (a), included a levy for the cost of administration of
the programs listed in that paragraph, the commissioner may
permit the county to increase its levy limit base under this
section by the amount determined by the commissioner to have
been levied for that purpose, provided that the total adjustment
shall not be in excess of three percent of the total expense for
income maintenance programs within the county. The
commissioner's decision is final.
(b) A governmental subdivision subject to the limitations
in this section may appeal to the commissioner of revenue for
authorization to levy for the special levies as contained in
section 275.50, subdivision 5, clauses (l), (m), and (n) (i),
(k), (l), and (m). If the governmental subdivision can provide
evidence satisfactory to the commissioner that it incurred costs
for the specified purposes of those levies, the commissioner may
allow the governmental subdivision to levy under section 275.50,
subdivision 5, clause (l), (m), or (n) (i), (k), (l), or (m), by
the amount determined by the commissioner. The commissioner's
decision is final.
(c) A county may appeal to the commissioner of revenue for
an adjustment to its levy limit base for taxes levied in 1989.
If the county can provide evidence satisfactory to the
commissioner that the percentage adjustments to the costs, fees,
or fines described in subdivision 3f, paragraph (e) or (f), do
not provide accurate adjustments for that county, the
commissioner may permit the county to increase its levy limit
base by the amount determined by the commissioner. The
commissioner's decision is final.
(d) A county may appeal to the commissioner of revenue for
an increase in its levy base for the 12 or 15 percent limit
under section 275.50, subdivision 5, clause (u), item (i), for
the portion of the amount of its payable 1989 special levy under
Minnesota Statutes 1988, section 275.50, subdivision 5, clause
(a), for the income maintenance programs that was actually used
to finance social services and social services administration
subject to the 18 percent limit under Minnesota Statutes 1988,
section 275.50, subdivision 5, clause (a), for payable 1989. If
the county can provide evidence satisfactory to the commissioner
in support of this claim, the commissioner may permit the county
to increase its levy base for the 12 or 15 percent limit under
section 275.50, subdivision 5, clause (u), item (i), in the
amount determined by the commissioner. The commissioner's
decision is final.
(e) A county may appeal to the commissioner of revenue for
an adjustment in its special levy for 1990 under section 275.50,
subdivision 5, clause (u), item (ii), if the difference between
the county share of costs not reimbursed by the state or federal
government of payments made in 1989 to or on behalf of
recipients of aid under any public assistance program authorized
by law and the amount levied in 1988 to pay those costs is
greater than 30 percent of the 1989 costs. The adjustment may
not exceed the amount of the difference between the county share
of these costs and the amount levied in 1988 to pay these costs.
Sec. 7. Minnesota Statutes 1990, section 275.51,
subdivision 7, is amended to read:
Subd. 7. [LEVY LIMIT CERTIFICATION.] (a) The commissioner
of revenue must certify the levy limitations under sections
275.50 to 275.58 to each governmental subdivision by October 23
for levy year 1989 and August 1 of levy year 1990 and thereafter.
(b) For taxes levied in 1991 and subsequent years, the
commissioner must also indicate on the levy limit certification
the additional amount for which the governmental subdivision may
levy if it is located in a county where the local sales and use
tax is not enacted. This additional amount is equal to the
reduction under subdivision 3i, paragraph (1). For governmental
subdivisions located in a county where the local sales and use
tax is not enacted, this additional levy authority shall be
added to the levy limit calculated under subdivision 3i when
determining excess levies.
Sec. 8. Minnesota Statutes 1990, section 398A.04,
subdivision 8, is amended to read:
Subd. 8. [TAXATION.] Before deciding to exercise the power
to tax, the authority shall give six weeks published notice in
all municipalities in the region. If a number of voters in the
region equal to five percent of those who voted for candidates
for governor at the last gubernatorial election present a
petition within nine weeks of the first published notice to the
secretary of state requesting that the matter be submitted to
popular vote, it shall be submitted at the next general
election. The question prepared shall be:
"Shall the regional rail authority have the power to impose
a property tax?
Yes .......
No ........"
If a majority of those voting on the question approve or if
no petition is presented within the prescribed time the
authority may levy a tax at any annual rate not exceeding
0.04835 percent of market value of all taxable property situated
within the municipality or municipalities named in its
organization resolution. Its recording officer shall file in
the office of the county auditor of each county in which
territory under the jurisdiction of the authority is located a
certified copy of the board of commissioners' resolution levying
the tax, and each county auditor shall assess and extend upon
the tax rolls of each municipality named in the organization
resolution the portion of the tax that bears the same ratio to
the whole amount that the net tax capacity of taxable property
in that municipality bears to the net tax capacity of taxable
property in all municipalities named in the organization
resolution. Collections of the tax shall be remitted by each
county treasurer to the treasurer of the authority. For taxes
levied in 1991, the amount levied for light rail transit
purposes under this subdivision shall not exceed 75 percent of
the amount levied in 1990 for light rail transit purposes under
this subdivision.
Sec. 9. Minnesota Statutes 1990, section 473.3994, is
amended by adding a subdivision to read:
Subd. 9. [LIGHT RAIL TRANSIT OPERATING COSTS.] (a) Before
submitting an application for federal assistance for light rail
transit facilities in the metropolitan area, the applicant must
provide to the metropolitan council estimates of the amount of
operating subsidy which will be required to operate light rail
transit in the corridor to which the federal assistance would be
applied. The information provided to the council must indicate
the amount of operating subsidy estimated to be required in each
of the first ten years of operation of the light rail transit
facility.
(b) The council must review and evaluate the information
provided under paragraph (a) with regard to the effect of
operating the light rail transit facility on the currently
available mechanisms for financing transit in the metropolitan
area.
(c) The council must present its evaluation to the
transportation and taxes committees of the house and senate, to
the appropriations committee of the house and the finance
committee of the senate, to the local government and
metropolitan affairs committee of the house, and to the
metropolitan affairs committee of the senate.
Sec. 10. Minnesota Statutes 1990, section 477A.012, is
amended by adding a subdivision to read:
Subd. 7. [AID OFFSET FOR 1992 COURT AND PUBLIC DEFENDER
COSTS.] (a) There shall be deducted from the payment to a county
under this section an amount equal to the cost of jury fees and,
in the case of a county located in the third or sixth judicial
districts, of public defense services in juvenile and
misdemeanor cases, to the extent those costs are assumed by the
state for the fiscal year beginning on July 1, 1992. The amount
of the deduction is computed as provided in this subdivision.
(b) By June 30, 1991, the supreme court shall determine and
certify to the department of revenue for each county, except
counties located in the eighth judicial district, the cost for
each county of jury fees during the fiscal year beginning on
July 1, 1992.
(c) By June 30, 1991, the board of public defense shall
determine and certify to the department of revenue the pro rata
share for each county in the third or sixth judicial district of
the cost of the state-financed public defense services in
juvenile and misdemeanor cases in the third or sixth judicial
district during the fiscal year beginning on July 1, 1992.
(d) One-half of the amount computed under paragraphs (b)
and (c) for each county shall be deducted from each local
government aid payment to the county under section 477A.015 in
1992 and each subsequent year. If the amount computed under
paragraph (b) exceeds the amount payable to a county under
subdivision 1, the excess shall be deducted from the aid payable
to the county under section 273.1398, subdivision 2, and then,
if necessary, from the disparity reduction aid under section
273.1398, subdivision 3.
Sec. 11. Laws 1989, First Special session chapter 1,
article 5, section 50, is amended to read:
Sec. 50. [LEVY LIMIT EXCEPTION.]
For taxes levied in 1989 and, 1990, and 1991 only, payable
in 1990 and, 1991, and 1992 only, a levy by the Itasca county
board under Laws 1988, chapter 517, is not subject to the levy
limitations of Minnesota Statutes, sections 275.50 to 275.56, or
other law.
Sec. 12. [BECKER COUNTY; LEVY LIMIT BASE ADJUSTMENT.]
For taxes payable in 1992, the adjusted levy limit base for
Becker county computed under Minnesota Statutes, section 275.51,
subdivision 3h, shall be increased by an amount of $900,000,
which is equal to expenditures that Becker county made from
reserve funds in calendar years 1987 and 1988, including federal
revenue sharing funds.
Sec. 13. [BECKER COUNTY; DELAY OF EXCESS LEVY PENALTY FROM
TAXES PAYABLE IN 1990.]
Notwithstanding Minnesota Statutes, section 275.51,
subdivision 4, 275.55, subdivision 1, or any other law, the
penalty imposed on Becker county for exceeding its levy
limitation for taxes payable in 1990 is delayed until calendar
year 1992. If the actual amount levied by Becker county for
taxes payable in 1992 is less than its levy limitation for taxes
payable in 1992 as adjusted by section 12, the commissioner of
revenue shall decrease the 1990 excess levy subject to a penalty
by the difference between the payable 1992 levy limitation and
the payable 1992 actual levy, up to the full amount of the
excess levy.
Sec. 14. [POPE COUNTY; SOLID WASTE MANAGEMENT LEVY.]
For taxes levied in 1990, payable in 1991, and thereafter,
Pope county may levy the amount necessary to pay the principal
and interest on department of energy and economic development
loans made to the Pope-Douglas solid waste board on June 10,
1985, and June 15, 1986, for solid waste management purposes.
The levy must be made as provided under Minnesota Statutes,
section 400.11.
The levy authority under this section is a special levy and
is not subject to the limitations in Minnesota Statutes,
sections 275.50 to 275.56.
The levy authority under this section expires when the
principal and interest has been paid.
Sec. 15. [INCREASE IN SOCIAL SERVICES SPECIAL LEVY FOR
SWIFT COUNTY.]
Subdivision 1. The maximum amount levied by Swift county
for taxes levied in 1991 under Minnesota Statutes 1990, section
275.50, subdivision 5, clause (a), is increased by $250,000.
This increase is a permanent adjustment to the special levy
under that clause.
Subd. 2. Subdivision 1 is effective the day following
approval by the Swift county board and compliance with Minnesota
Statutes, section 645.021, subdivision 3.
Sec. 16. [INCREASE IN SOCIAL SERVICES SPECIAL LEVY FOR
MILLE LACS COUNTY.]
Subdivision 1. The maximum amount levied by Mille Lacs
county for taxes levied in 1991 under Minnesota Statutes 1990,
section 275.50, subdivision 5, clause (a), is increased by the
amount levied by Mille Lacs county for social services in 1990,
payable in 1991, under Laws 1990, chapter 604, article 3,
section 54. This increase is a permanent adjustment to the
special levy under that clause.
Subd. 2. Subdivision 1 is effective the day following
approval by the Mille Lacs county board and compliance with
Minnesota Statutes, section 645.021, subdivision 3.
Sec. 17. [GOODHUE COUNTY; EXCESS LEVY PENALTY ABATEMENT.]
The excess levy amount of $500,000, which Goodhue county
levied in 1990, for taxes payable in 1991, shall be exempt from
the penalties imposed under sections 275.51, subdivision 4, and
275.55.
Sec. 18. [COON CREEK WATERSHED DISTRICT; WATER MAINTENANCE
AND REPAIR FUND.]
Subdivision 1. [CREATION OF FUNDS; TAX
LEVY.] Notwithstanding section 23, the Coon Creek watershed
district may, in addition to its other powers, establish a water
maintenance and repair fund. The fund must be kept distinct
from all other funds of the district. The fund must be
maintained by an annual ad valorem tax levy on the net tax
capacity of all taxable property within the Coon Creek watershed
district sufficient to raise not more than $30,000 in taxes
payable in 1992, and not more than $30,000 in each year
thereafter. The board of managers of the district shall adopt
each year, by resolution, the amount to be raised by the levy
for the fund for the ensuing year. This amount must be levied,
collected, and distributed to the district in accordance with
Minnesota Statutes, section 103D.915, in addition to any other
money levied, collected, and distributed to the district.
Subd. 2. [PURPOSE OF FUND.] The water maintenance and
repair fund may be used for maintenance, repair, restoration,
upkeep, and rehabilitation of public ditches, drains, dams,
sewers, rivers, streams, watercourses, and water bodies, natural
or artificial, lying wholly or partly within the district.
Subd. 3. [WORKS; MUNICIPALITIES.] Works to be undertaken
and paid for from the water maintenance and repair fund must be
ordered by the board of managers of the district. Before the
commencement of works is ordered, affected municipalities must
be notified in writing by the district of the proposed works and
estimated costs. Within 30 days following receipt of the
written notice, an affected municipality may notify the district
in writing that it will perform the works ordered by the
district. If the municipality undertakes the works, it must be
paid by the district from the water maintenance and repair
fund. If the municipality fails to perform the works, the
district may have the works performed in any other manner
authorized by law.
Sec. 19. [TAX LEVY; KANARANZI-LITTLE ROCK WATERSHED
DISTRICT.]
Notwithstanding section 23 and in addition to the levy
authorized in Minnesota Statutes, section 103D.905, subdivision
3; and Laws 1989, chapter 275, the Kanaranzi-Little Rock
watershed district administrative fund under Minnesota Statutes,
section 103D.905, consists of an additional levy for the costs
of administration of the PL-566 Upland Conservation Program.
The levy must be a percentage on the net tax capacity of all
taxable property within the Kanaranzi-Little Rock watershed
district sufficient to raise not more than $30,000 for taxes
payable in 1992, and not more than $30,000 in each year
thereafter. The board of managers of the district shall adopt
each year, by resolution, the amount to be raised by the levy
for the fund for the ensuing year. This amount must be levied,
collected, and distributed to the district in accordance with
Minnesota Statutes, section 103D.915, in addition to any other
money levied, collected, and distributed to the district.
Sec. 20. [FEDERAL FUNDING; LIGHT RAIL TRANSIT.]
(a) By July 1, 1992, the regional transit board and the
commissioner of transportation shall, in consultation with the
affected regional rail authorities, prepare a joint application
for federal assistance for light rail transit facilities in the
metropolitan area. The application must be reviewed and
approved by the metropolitan council before it is submitted by
the board and the commissioner. In reviewing the application
the council must consider the information submitted to it under
Minnesota Statutes, section 473.3994, subdivision 9. The board
and the commissioner must consult with the council in preparing
the application. The application may provide for metropolitan
regional railroad authorities to design or construct light rail
transit facilities under contract with the commissioner.
(b) Until the application described in paragraph (a) is
submitted, no political subdivision in the metropolitan area may
on its own apply for federal assistance for light rail transit
planning or construction.
Sec. 21. [GREAT RIVER REGIONAL LIBRARY SPECIAL LEVY.]
The amount levied in 1991, payable in 1992, by member local
governments of the Great River Regional Library under Minnesota
Statutes, section 275.50, subdivision 5, clause (n), may be
increased by an additional two percent over the amount
authorized in that clause if the city library board of the city
of Paynesville or the city of Staples vote by August 1, 1991, to
join that regional library system.
Sec. 22. [AUTHORITY TO TRANSFER LIGHT RAIL MONEY.]
Notwithstanding any law to the contrary, a metropolitan
county regional railroad authority may transfer any available
money of the authority, including money in capital accounts, to
its county to be expended to meet social service costs during
1991. The authority under this section to transfer a regional
railroad authority's levy applies only during calendar year 1991.
Sec. 23. [SPECIAL TAXING DISTRICTS 1992 LEVY LIMITS.]
Notwithstanding any other general or special law or any
charter provision except as provided in this article, for taxes
levied in 1991, payable in 1992 only, the amount levied by a
special taxing district for nondebt purposes is limited to (1)
the amount levied by the special taxing district in 1990 for
nondebt purposes, increased by (2) three percent. For purposes
of this section, the commissioner of revenue shall define
"special taxing district" and "nondebt purposes." This section
does not apply to the regional transit board.
Sec. 24. [SPECIAL SERVICE DISTRICT; CITY OF CROOKSTON.]
Subdivision 1. [SPECIAL SERVICES DEFINED.] For purposes of
this section, "special services" means all services rendered or
contracted for by the city of Crookston, including, but not
limited to:
(1) the repair, maintenance, operation, and construction of
any improvement authorized by Minnesota Statutes, section
429.021;
(2) parking services rendered or contracted for by the
city; and
(3) any other service or improvement provided by the city
or development authority that is authorized by law or charter.
Subd. 2. [ESTABLISHMENT OF SPECIAL SERVICE DISTRICT.] The
governing body of the city of Crookston may adopt an ordinance
establishing a special service district to be operated by the
city of Crookston. Minnesota Statutes, chapter 428A, governs
the establishment and operation of special service districts in
the city.
Subd. 3. [LOCAL APPROVAL.] This section is effective the
day following compliance with Minnesota Statutes, section
645.021, subdivision 3, by the governing body of the city of
Crookston.
Subd. 4. [LOCAL APPROVAL; EFFECTIVE DATE.] Subdivisions 1
to 3 are effective the day after approval by the governing body
of the city of Crookston and its compliance with Minnesota
Statutes, section 645.021, subdivision 3.
Sec. 25. [INCREASE IN SOCIAL SERVICES SPECIAL LEVY FOR
MEEKER COUNTY.]
Subdivision 1. The maximum amount levied by Meeker county
for taxes levied in 1991 under Minnesota Statutes 1990, section
275.50, subdivision 5, clause (a), is increased by $360,000.
This increase is a permanent adjustment to the special levy
under that clause.
Subd. 2. Subdivision 1 is effective the day following
approval by the Meeker county board and compliance with
Minnesota Statutes, section 645.021, subdivision 3.
Sec. 26. [APPLICATION.]
Sections 9, 20, and 22 apply in the counties of Anoka,
Carver, Dakota, Hennepin, Ramsey, Scott, and Washington.
Sec. 27. [EFFECTIVE DATE.]
Sections 1 to 9, 18, and 19 are effective for taxes levied
in 1991, payable in 1992, and thereafter. That portion of
section 10 relating to the third and sixth judicial districts'
juvenile and misdemeanor public defender costs is effective for
aids payable in 1992 and subsequent years, if a law providing
for the state assumption of these costs is enacted. That
portion of section 10 relating to the cost of jury fees is
effective for aids payable in 1992 and subsequent years, if a
law providing for the state assumption of jury fees is enacted.
Section 11 is effective for taxes payable in 1992. Sections 12
and 13 are effective the day after local approval by the Becker
county board and compliance with Minnesota Statutes, section
645.021, subdivision 3. Sections 17, 20, and 22 are effective
the day following final enactment.
ARTICLE 5
TRUTH IN TAXATION
Section 1. Minnesota Statutes 1990, section 275.065,
subdivision 3, is amended to read:
Subd. 3. [NOTICE OF PROPOSED PROPERTY TAXES.] (a) The
county auditor shall prepare and the county treasurer shall
deliver on or before November 10 each year, by first class mail
to each taxpayer at the address listed on the county's current
year's assessment roll, a notice of proposed property taxes and,
in the case of a town, final property taxes.
(b) The commissioner of revenue shall prescribe the form of
the notice.
(c) The notice must inform taxpayers that it contains the
amount of property taxes each taxing authority other than a town
proposes to collect for taxes payable the following year as
required in paragraph (d) or (e) and, for a town, the amount of
its final levy. It must clearly state that each taxing
authority, other than a town or special taxing district, will
hold a public meeting to receive public testimony on the
proposed budget and proposed or final property tax levy, or, in
case of a school district, on the current budget and proposed
property tax levy. It must clearly state the time and place of
each taxing authority's meeting and an address where comments
will be received by mail. It must state the time and place for
the continuation of the hearing if the hearing is not completed
on the original date.
(d) Except as provided in paragraph (e), for taxes levied
in 1990 and 1991, the notice must state by county, city or town,
and school district:
(1) the total proposed or, for a town, final property tax
levy for taxes payable the following year after reduction for
state aid;
(2) the percentage increase or decrease from the actual
property tax levy for taxes payable in the current year; and
(3) for counties, cities, and towns, the increase or
decrease in population from the second previous calendar year to
the immediately prior calendar year, and for school districts,
the increase or decrease in the number of pupils in average
daily membership from the second previous current school year to
the immediately prior following school year as determined by the
commissioner of education. The data used to determine the
increase or decrease in population under this clause must be the
data used for purposes of the population adjustment to the levy
limit base of the county, city, or town under section 275.51,
subdivision 6.
For notices which are not parcel-specific, the notice must
also state a total percentage increase or decrease in the
proposed levy, relative to the actual property tax levy for
taxes payable in the current year for the county, city or town,
and school district. The county auditor shall compute the total
percentage increase or decrease as an average percentage change
weighted in proportion to each taxing jurisdiction's proportion
of the total levy.
For purposes of this paragraph, "proposed property taxes
after reduction for state aid" means the taxing authority's levy
certified under section 275.07, subdivision 1.
(e) In the case of a county containing a city of the first
class, or taxing authority lying wholly within a county or
counties containing a city of the first class, for taxes levied
in 1991, and thereafter, and for all counties for taxes levied
in 1992 and thereafter, the notice must state for each parcel:
(1) the market value of the property as defined under
section 272.03, subdivision 8, for property taxes payable in the
following year and for taxes payable the current year;
(2) by county, city or town, school district, the sum of
the special taxing districts, and as a total of the taxing
authorities, including special taxing districts, the proposed
or, for a town, final net tax on the property for taxes payable
the following year and the actual tax for taxes payable the
current year. In the case of a parcel where tax increment or
the fiscal disparities areawide tax applies, the proposed tax
levy on the captured value or the proposed tax levy on the tax
capacity subject to the areawide tax must each be stated
separately and not included in the sum of the special taxing
districts; and
(3) the increase or decrease in the amounts in clause (2)
from taxes payable in the current year to proposed or, for a
town, final taxes payable the following year, expressed as a
dollar amount and as a percentage.
(f) The notice must clearly state that the proposed or
final taxes do not include the following:
(1) special assessments;
(2) levies approved by the voters after the date the
proposed taxes are certified, including bond referenda, school
district levy referenda, and levy limit increase referenda;
(3) amounts necessary to pay cleanup or other costs due to
a natural disaster occurring after the date the proposed taxes
are certified; and
(4) amounts necessary to pay tort judgments against the
taxing authority that become final after the date the proposed
taxes are certified; and
(5) any additional amount levied in lieu of a local sales
and use tax, unless this amount is included in the proposed or
final taxes.
(g) Except as provided in subdivision 7, failure of the
county auditor to prepare or the county treasurer to deliver the
notice as required in this section does not invalidate the
proposed or final tax levy or the taxes payable pursuant to the
tax levy.
(h) In the case of class 4 residential property used as a
residence for lease or rental periods of 30 days or more, the
taxpayer must either:
(1) mail or deliver a copy of the notice of proposed
property taxes to each tenant, renter, or lessee; or
(2) post a copy of the notice in a conspicuous place on the
premises of the property.
The notice must be mailed or posted by the taxpayer by
November 13 or within three days of receipt of the notice,
whichever is later. A taxpayer may notify the county treasurer
of the address of the taxpayer, agent, caretaker, or manager of
the premises to which the notice must be mailed in order to
fulfill the requirements of this paragraph.
Sec. 2. Minnesota Statutes 1990, section 275.065,
subdivision 5a, is amended to read:
Subd. 5a. [PUBLIC ADVERTISEMENT.] (a) A city that has a
population of more than 1,000, county, or school district shall
advertise in a newspaper a notice of its intent to adopt a
budget and property tax levy or, in the case of a school
district, a property tax levy to review its current budget and
proposed property taxes payable in the following year, at a
public hearing. The notice must be published not less than
two business days nor more than six business days before the
hearing.
For a city that has a population of more than 1,000 but
less than 2,500 the advertisement must be at least one-eighth
page in size of a standard-size or a tabloid-size newspaper, and
the headlines in the advertisement stating the notice of
proposed property taxes and the notice of public hearing must be
in a type no smaller than 24-point 14-point. The text of the
advertisement must be no smaller than 18-point 12-point, except
that the property tax amounts and percentages may be in 14-point
10-point type.
For a city that has a population of 2,500 or more, a county
or a school district, the advertisement must be at least
one-quarter page in size of a standard-size or a tabloid-size
newspaper, and the headlines in the advertisement stating the
notice of proposed property taxes and the notice of public
hearing must be in a type no smaller than 30-point. The text of
the advertisement must be no smaller than 22-point, except that
the property tax amounts and percentages may be in 14-point type.
The advertisement must not be placed in the part of the
newspaper where legal notices and classified advertisements
appear. The advertisement must be published in an official
newspaper of general circulation in the taxing authority. The
newspaper selected must be one of general interest and
readership in the community, and not one of limited subject
matter. The advertisement must appear in a newspaper that is
published at least once per week.
(b) The advertisement must be in the following form, except
that the notice for a school district must not may include
references to the current budget hearings or to adoption of a
budget in regard to proposed property taxes:
"NOTICE OF
PROPOSED PROPERTY TAXES
(City/County/School District) of .........
The governing body of ........ will soon hold budget hearings
and vote on the property taxes for (city/county services that
will be provided in 199_/school district services that will be
provided in 199_ and 199_).
The property tax amounts below compare current
(city/county/school district) property taxes and the property
taxes that would be collected in 199_ if the budget now being
considered is approved.
199_ Proposed 199_ 199_ Increase
Property Taxes Property Taxes or Decrease
$........ $........ .....%
NOTICE OF PUBLIC HEARING:
All concerned citizens are invited to attend a public hearing
and express their opinions on the proposed (city/county/school
district) budget and property taxes or in the case of a school
district, its current budget and proposed property taxes,
payable in the following year. The hearing will be held on
(Month/Day/Year) at (Time) at (Location, Address).
A continuation of the hearing, if necessary, will be held on
(Month/Day/Year) at (Time) at (Location, Address).
Written comments may be directed to (Address)."
(c) A city with a population of 1,000 or less must
advertise by posted notice as defined in section 645.12,
subdivision 1. The advertisement must be posted at the time
provided in paragraph (a). It must be in the form required in
paragraph (b).
(d) For purposes of this subdivision, the population of a
city is the most recent population as determined by the state
demographer under section 116K.04, subdivision 4.
Sec. 3. Minnesota Statutes 1990, section 275.065,
subdivision 6, is amended to read:
Subd. 6. [PUBLIC HEARING; ADOPTION OF BUDGET AND LEVY.]
Between November 15 and December 20, the governing bodies of the
city and county shall each hold a public hearing to adopt its
final budget and property tax levy for taxes payable in the
following year, and the governing body of the school district
shall hold a public hearing to review its current budget and
adopt its property tax levy for taxes payable in the following
year.
At the hearing, the taxing authority, other than a school
district, may amend the proposed budget and property tax levy
and must adopt a final budget and property tax levy, and the
school district may amend the proposed property tax levy and
must adopt a final property tax levy.
The property tax levy certified under section 275.07 by a
city, county, or school district must not exceed the proposed
levy determined under subdivision 1, except by an amount up to
the sum of the following amounts:
(1) the amount of a school district levy whose voters
approved a referendum to increase taxes under section 124A.03,
subdivision 2, or 124.82, subdivision 3, after the proposed levy
was certified;
(2) the amount of a city or county levy approved by the
voters under section 275.58 after the proposed levy was
certified;
(3) the amount of a levy to pay principal and interest on
bonds issued or approved by the voters under section 475.58
after the proposed levy was certified;
(4) the amount of a levy to pay costs due to a natural
disaster occurring after the proposed levy was certified, if
that amount is approved by the commissioner of revenue under
subdivision 6a;
(5) the amount of a levy to pay tort judgments against a
taxing authority that become final after the proposed levy was
certified, if the amount is approved by the commissioner of
revenue under subdivision 6a; and
(6) the amount of an increase in levy limits certified to
the taxing authority by the commissioner of revenue or the
commissioner of education after the proposed levy was certified;
and
(7) if not included in the certified levy, any additional
amount levied pursuant to section 275.51, subdivision 7,
paragraph (b).
At the hearing the percentage increase in property taxes
proposed by the taxing authority, if any, and the specific
purposes for which property tax revenues are being increased
must be discussed. During the discussion, the governing body
shall hear comments regarding a proposed increase and explain
the reasons for the proposed increase. The public shall be
allowed to speak and to ask questions prior to adoption of any
measures by the governing body. The governing body, other than
the governing body of a school districts district, shall adopt
its final property tax levy prior to adopting its final budget.
If the hearing is not completed on its scheduled date, the
taxing authority must announce, prior to adjournment of the
hearing, the date, time, and place for the continuation of the
hearing. The continued hearing must be held at least five
business days but no more than 14 business days after the
original hearing.
The hearing must be held after 5:00 p.m. if scheduled on a
day other than Saturday. No hearing may be held on a Sunday.
The county auditor shall provide for the coordination of hearing
dates for all taxing authorities within the county.
By August 1, the county auditor shall notify the clerk of
each school district within the county of the dates that the
county board has designated for its hearing and any continuation
under subdivision 3. By August 15, each school board shall
certify to the county auditors of the counties in which the
school district is located the dates on which it elects to hold
its hearings and any continuations under subdivision 3. If a
school board does not certify the dates by August 15, the
auditor will assign the hearing date. The dates elected or
assigned must not conflict with the county hearing dates. By
August 20, the county auditor shall notify the clerks of the
cities within the county of the dates on which the county and
school districts have elected to hold their hearings. At the
time a city certifies its proposed levy under subdivision 1 it
shall certify the dates on which it elects to hold its hearings
and any continuations under subdivision 3. The city must not
select dates that conflict with those elected by or assigned to
the counties and school districts in which the city is located.
The hearing dates so elected or assigned must be designated
on the notices required under subdivision 3.
This subdivision does not apply to towns and special taxing
districts.
Sec. 4. [EFFECTIVE DATE.]
Sections 1 to 3 are effective for taxes levied in 1991,
payable in 1992, and thereafter.
ARTICLE 6
INCOME TAX AND FEDERAL UPDATE
Section 1. Minnesota Statutes 1990, section 10A.322,
subdivision 1, is amended to read:
Subdivision 1. [AGREEMENT BY CANDIDATE.] (a) As a
condition of receiving a public subsidy from the state elections
campaign fund, a candidate shall sign and file with the board a
written agreement in which the candidate agrees that the
candidate will comply with sections 10A.25 and 10A.324.
(b) Before the first day of filing for office, the board
shall forward agreement forms to all filing officers. The board
shall also provide agreement forms to candidates on request at
any time. The candidate may sign an agreement and submit it to
the filing officer on the day of filing an affidavit of
candidacy or petition to appear on the ballot, in which case the
filing officer shall without delay forward signed agreements to
the board. Alternatively, the candidate may submit the
agreement directly to the board by the following at any time
before September 1 preceding the general election. An agreement
may not be signed or rescinded after that date.
(c) The board shall forward a copy of any agreement signed
under this subdivision to the commissioner of revenue.
(d) Notwithstanding any provisions of this section, when a
vacancy occurs that will be filled by means of a special
election and the filing period does not coincide with the filing
period for the general election, a candidate may sign and submit
a spending limit agreement at any time before the deadline for
submission of a signed agreement under section 10A.315.
Sec. 2. Minnesota Statutes 1990, section 10A.322,
subdivision 4, is amended to read:
Subd. 4. [CREDIT REFUND RECEIPT FORMS; PENALTY.] The board
shall make available to a political party on request and to any
candidate for whom an agreement under this section is effective,
a supply of official credit refund receipt forms that state in
boldface type that (1) a contributor who is given a receipt form
is eligible to claim a credit refund as provided in section
290.06, subdivision 23, and (2) if the contribution is to a
candidate, that the candidate has signed an agreement to limit
campaign expenditures as provided in this section. The forms
must provide duplicate copies of the receipt to be attached to
the contributor's claim. A candidate who does not sign an
agreement under this section and who willfully issues an
official credit refund receipt form or a facsimile of one to any
of the candidate's contributors is guilty of a misdemeanor.
Sec. 3. Minnesota Statutes 1990, section 10A.43,
subdivision 3, is amended to read:
Subd. 3. [SUBMISSION OF AGREEMENT.] (a) Before the first
day of filing for office, the board shall forward agreement
forms to all filing officers. The board shall also make
agreement forms available to congressional candidates on request
at any time.
(b) The congressional candidate may sign an agreement and
submit it, along with a copy of the candidate's federal
designation of a principal campaign committee, to the filing
officer on the day of filing an affidavit of candidacy or
petition to appear on the ballot, in which case the filing
officer shall without delay forward signed agreements to the
board. Alternatively, for a general election the congressional
candidate may obtain an agreement form from the board and submit
the agreement, along with a copy of the candidate's federal
designation of a principal campaign committee, directly to the
board by at any time before September 1 preceding the general
election.
(c) An agreement may not be signed or rescinded after that
date September 1 preceding the general election.
(d) The board shall forward a copy of any agreement signed
under this subdivision to the commissioner of revenue.
(e) Notwithstanding any provisions of this section, when a
vacancy in a congressional office occurs that will be filled by
means of a special election, and the filing period does not
coincide with the filing period for the general election, a
congressional candidate may sign and submit a spending limit
agreement at any time before one day after the candidate files
an affidavit of candidacy or nominating petition for the office.
Sec. 4. Minnesota Statutes 1990, section 10A.43,
subdivision 4, is amended to read:
Subd. 4. [HOW LONG AGREEMENT IS EFFECTIVE.] The agreement,
insofar as it relates to the expenditure limits in section
10A.44, remains effective for congressional candidates until the
termination of the authorized committees of the congressional
candidate, as provided under United States Code, title 2,
section 433(d), or the day filings open for the next succeeding
election to the office held or sought at the time of
agreement, or the agreement is rescinded by the candidate within
the time limits provided by law, whichever occurs first.
Sec. 5. Minnesota Statutes 1990, section 10A.44,
subdivision 4, is amended to read:
Subd. 4. [POSTELECTION YEAR EXPENDITURES.] In any year
preceding or following an election year for the office held or
sought, the aggregate amount of expenditures on behalf of a
congressional candidate for or holder of that office must not
exceed 20 percent of the expenditure limit in subdivisions 1 and
2.
Sec. 6. Minnesota Statutes 1990, section 270A.03,
subdivision 7, is amended to read:
Subd. 7. "Refund" means an individual income tax refund or
political contribution refund, pursuant to chapter 290, or a
property tax credit or refund, pursuant to chapter 290A.
For purposes of this chapter, lottery prizes, as set forth
in section 349A.08, subdivision 8, shall be treated as refunds.
Sec. 7. Minnesota Statutes 1990, section 289A.12, is
amended by adding a subdivision to read:
Subd. 14. [REGULATED INVESTMENT COMPANIES; REPORTING
EXEMPT-INTEREST DIVIDENDS.] (a) A regulated investment company
paying $10 or more in exempt-interest dividends to an individual
who is a resident of Minnesota must make a return indicating the
amount of the exempt-interest dividends, the name, address, and
social security number of the recipient, and any other
information that the commissioner specifies. A copy of the
return must be provided to the shareholder no later than 30 days
after the close of the taxable year. The copy of the return
provided to the shareholder must include a clear statement, in
the form prescribed by the commissioner, that the
exempt-interest dividends must be included in the computation of
Minnesota taxable income.
(b) This subdivision applies to regulated investment
companies required to register under chapter 80A.
(c) For purposes of this subdivision, the following
definitions apply.
(1) "Exempt-interest dividends" mean exempt-interest
dividends as defined in section 852(b)(5) of the Internal
Revenue Code of 1986, as amended through December 31, 1990, but
does not include the portion of exempt-interest dividends that
are not required to be added to federal taxable income under
section 290.01, subdivision 19a, clause (1)(ii).
(2) "Regulated investment company" means regulated
investment company as defined in section 851(a) of the Internal
Revenue Code of 1986, as amended through December 31, 1990, or a
fund of the regulated investment company as defined in section
851(h) of the Internal Revenue Code of 1986, as amended through
December 31, 1990.
Sec. 8. Minnesota Statutes 1990, section 289A.18,
subdivision 2, is amended to read:
Subd. 2. [WITHHOLDING RETURNS, ENTERTAINER WITHHOLDING
RETURNS, RETURNS FOR WITHHOLDING FROM PAYMENTS TO OUT-OF-STATE
CONTRACTORS, AND WITHHOLDING RETURNS FROM PARTNERSHIPS AND SMALL
BUSINESS S CORPORATIONS.] Withholding returns are due on or
before the last day of the month following the close of the
quarterly period. However, if the return shows timely deposits
in full payment of the taxes due for that period, the return may
be filed on or before the tenth day of the second calendar month
following the period. An employer, in preparing a quarterly
return, may take credit for monthly deposits previously made for
that quarter. Entertainer withholding tax returns are due
within 30 days after each performance. Returns for withholding
from payments to out-of-state contractors are due within 30 days
after the payment to the contractor. Returns for withholding by
partnerships are due on or before the due date specified for
filing partnership returns. Returns for withholding by small
business S corporations are due on or before the due date
specified for filing corporate franchise tax returns.
Sec. 9. Minnesota Statutes 1990, section 289A.19,
subdivision 1, is amended to read:
Subdivision 1. [INDIVIDUAL INCOME, FIDUCIARY INCOME,
ENTERTAINMENT TAX, AND INFORMATION RETURNS.] When, in the
commissioner's judgment, good cause exists, the commissioner may
extend the time for filing individual and fiduciary income tax
returns, entertainment tax returns, and information returns for
not more than six months. If an extension to file the federal
individual or fiduciary income tax return or information return
has been granted under section 6081 of the Internal Revenue Code
of 1986, as amended through December 31, 1989, the time for
filing the state return is extended for that period. The
commissioner may require the taxpayer to file a tentative return
when the regularly required return is due, and to pay a tax on
the basis of the tentative return at the times required for the
payment of taxes on the basis of the regularly required return
from the taxpayer.
Sec. 10. Minnesota Statutes 1990, section 289A.20, is
amended by adding a subdivision to read:
Subd. 5. [PAYMENT OF FRANCHISE TAX ON LIFO RECAPTURE.) If
a corporation is subject to LIFO recapture under section 1363(d)
of the Internal Revenue Code of 1986, as amended through
December 31, 1990, any increase in the tax imposed by section
290.06, subdivision 1, by reason of the inclusion of the LIFO
recapture amount in its income is payable in four equal
installments.
The first installment must be paid on or before the due
date, determined without regard to extensions, for filing the
return for the first taxable year for which the corporation was
subject to the LIFO recapture. The three succeeding
installments must be paid on or before the due date, determined
without regard to extensions, for filing the corporations's
return for the three succeeding taxable years.
For purposes of computing interest on underpayments, the
last three installments must not be considered underpayments
until after the payment due date specified in this subdivision.
Sec. 11. Minnesota Statutes 1990, section 289A.30,
subdivision 1, is amended to read:
Subdivision 1. [INDIVIDUAL AND FIDUCIARY INCOME, CORPORATE
FRANCHISE TAX.] Where good cause exists, the commissioner may
extend the time for payment of the amount determined as an
individual or a fiduciary income tax or corporate franchise tax
by the taxpayer, or an amount determined as a deficiency, for a
period of not more than six months from the date prescribed for
the payment of the tax.
Sec. 12. Minnesota Statutes 1990, section 289A.38,
subdivision 9, is amended to read:
Subd. 9. [REPORT MADE OF CHANGE OR CORRECTION OF FEDERAL
RETURN.] If a taxpayer is required to make a report under
subdivision 7, and does report the change or files a copy of the
amended return, the commissioner may recompute and reassess the
tax due, including a refund (1) within one year after the report
or amended return is filed with the commissioner,
notwithstanding any period of limitations to the contrary, or
(2) within any other applicable period stated in this section,
whichever period is longer. The period provided for the
carryback of any amount of loss or credit is also extended as
provided in this subdivision, notwithstanding any law to the
contrary. If the commissioner has completed a field audit of
the taxpayer, and, but for this subdivision, the commissioner's
time period to adjust the tax has expired, the additional tax
due or refund is limited to only those changes that are required
to be made to the return which relate to the changes made on the
federal return. This subdivision does not apply to sales and
use tax.
For purposes of this subdivision and section 289A.42,
subdivision 2, a "field audit" is the physical presence of
examiners in the taxpayer's or taxpayer's representative's
office conducting an examination of the taxpayer with the
intention of issuing an assessment or notice of change in tax or
which results in the issuing of an assessment or notice of
change in tax. The examination may include inspecting a
taxpayer's place of business, tangible personal property,
equipment, computer systems and facilities, pertinent books,
records, papers, vouchers, computer printouts, accounts, and
documents.
Sec. 13. Minnesota Statutes 1990, section 289A.38,
subdivision 10, is amended to read:
Subd. 10. [INCORRECT DETERMINATION OF FEDERAL ADJUSTED
GROSS INCOME.] Notwithstanding any other provision of this
chapter, if a taxpayer whose gross net income is determined
under section 290.01, subdivisions 20 and 20e subdivision 19,
omits from income an amount that will under the Internal Revenue
Code of 1986, as amended through December 31, 1989, extend the
statute of limitations for the assessment of federal income
taxes, or otherwise incorrectly determines the taxpayer's
federal adjusted gross income resulting in adjustments by the
Internal Revenue Service, then the period of assessment and
determination of tax will be that under the Internal Revenue
Code of 1986, as amended through December 31, 1989. When a
change is made to federal income during the extended time
provided under this subdivision, the provisions under
subdivisions 7 to 9 regarding additional extensions apply.
Sec. 14. Minnesota Statutes 1990, section 289A.42,
subdivision 2, is amended to read:
Subd. 2. [FEDERAL EXTENSIONS.] When a taxpayer who
consents to an extension of time for the assessment of federal
income taxes must notify the commissioner within 90 days of the
execution of the consent., the period in which the commissioner
may recompute the tax is also extended, notwithstanding any
period of limitations to the contrary, as follows:
(1) for the periods provided in section 289A.38,
subdivisions 8 and 9;
(2) for six months following the expiration of the extended
federal period of limitations when no change is made by the
federal authority. If no change is made by the federal
authority, and, but for this subdivision, the commissioner's
time period to adjust the tax has expired, and if the
commissioner has completed a field audit of the taxpayer, no
additional changes resulting in additional tax due or a refund
may be made. For purposes of this subdivision, "field audit"
has the meaning given it in section 289A.38, subdivision 9.
Sec. 15. Minnesota Statutes 1990, section 289A.50,
subdivision 1, is amended to read:
Subdivision 1. [GENERAL RIGHT TO REFUND.] (a) Subject to
the requirements of this section and section 289A.40, a taxpayer
who has paid a tax in excess of the taxes lawfully due and who
files a written claim for refund will be refunded or credited
the overpayment of the tax determined by the commissioner to be
erroneously paid.
(b) The claim must specify the name of the taxpayer, the
date when and the period for which the tax was paid, the kind of
tax paid, the amount of the tax that the taxpayer claims was
erroneously paid, the grounds on which a refund is claimed, and
other information relative to the payment and in the form
required by the commissioner. An income tax, estate tax, or
corporate franchise tax return, or amended return claiming an
overpayment constitutes a claim for refund.
(c) When, in the course of an examination, and within the
time for requesting a refund, the commissioner determines that
there has been an overpayment of tax, the commissioner shall
refund or credit the overpayment to the taxpayer and no demand
is necessary. If the overpayment exceeds $1, the amount of the
overpayment must be refunded to the taxpayer. If the amount of
the overpayment is less than $1, the commissioner is not
required to refund. In these situations, the commissioner does
not have to make written findings or serve notice by mail to the
taxpayer.
(d) If the amount allowable as a credit for withholding or,
estimated taxes, or dependent care exceeds the tax against which
the credit is allowable, the amount of the excess is considered
an overpayment. The refund allowed by section 290.06,
subdivision 23, is also considered an overpayment.
(e) If the entertainment tax withheld at the source exceeds
by $1 or more the taxes, penalties, and interest reported in the
return of the entertainment entity or imposed by section
290.9201, the excess must be refunded to the entertainment
entity. If the excess is less than $1, the commissioner need
not refund that amount.
(f) If the surety deposit required for a construction
contract exceeds the liability of the out-of-state contractor,
the commissioner shall refund the difference to the contractor.
(g) An action of the commissioner in refunding the amount
of the overpayment does not constitute a determination of the
correctness of the return of the taxpayer.
(h) There is appropriated from the general fund to the
commissioner of revenue the amount necessary to pay refunds
allowed under this section.
Sec. 16. Minnesota Statutes 1990, section 289A.60,
subdivision 2, is amended to read:
Subd. 2. [PENALTY FOR FAILURE TO MAKE AND FILE RETURN.] If
a taxpayer fails to make and file a return other than an income
tax return of an individual, within the time prescribed or an
extension, a penalty is added to the tax. The penalty is three
percent of the amount of tax not paid on or before the date
prescribed for payment of the tax including any extensions if
the failure is for not more than 30 days, with an additional
five percent of the amount of tax remaining unpaid during each
additional 30 days or fraction of 30 days, during which the
failure continues, not exceeding 23 percent in the aggregate.
If a taxpayer fails to file a return, other than an income
tax return of an individual, within 60 days of the date
prescribed for filing of the return (determined with regard to
any extension of time for filing), the addition to tax under
this subdivision must not be less than the lesser of: (1) $200;
or (2) the greater of (a) 25 percent of the amount required to
be shown as tax on the return without reduction for any payments
made or refundable credits allowable against the tax, or (b) $50.
If a taxpayer fails to file an individual income tax return
within six months after the date prescribed for filing of the
return, a penalty of ten percent of the amount of tax not paid
by the end of that six-month period is added to the tax.
Sec. 17. Minnesota Statutes 1990, section 289A.60,
subdivision 12, is amended to read:
Subd. 12. [PENALTIES RELATING TO PROPERTY TAX REFUNDS.]
(a) If the commissioner determines that a property tax refund
claim is or was excessive and was filed with fraudulent intent,
the claim must be disallowed in full. If the claim has been
paid, the amount disallowed may be recovered by assessment and
collection.
(b) If it is determined that a property tax refund claim is
excessive and was negligently prepared, ten percent of the
corrected claim must be disallowed. If the claim has been paid,
the amount disallowed must be recovered by assessment and
collection.
(c) An owner or managing agent who knowingly fails to give
a certificate of rent constituting property tax to a renter, as
required by section 290A.19, paragraph (a), is liable to the
commissioner for a penalty of $100 for each failure.
(d) If the owner or managing agent knowingly gives rent
certificates that report total rent constituting property taxes
in excess of the amount of actual rent constituting property
taxes paid on the rented part of a property, the owner or
managing agent is liable for a penalty equal to the greater of
(1) $100 or (2) 50 percent of the excess that is reported. An
overstatement of rent constituting property taxes is presumed to
be knowingly made if it exceeds by ten percent or more the
actual rent constituting property taxes.
(e) A claim filed after the original or extended due date
will be reduced by five percent of the amount otherwise
allowable, plus an additional five percent for each month of
delinquency, not exceeding a total reduction of 25 percent,
which may be canceled or reduced by the commissioner if the
delinquency is due to reasonable cause. In any event, No claim
is allowed if the initial claim is filed more than one year
after the original due date for filing the claim.
Sec. 18. Minnesota Statutes 1990, section 290.01,
subdivision 19, is amended to read:
Subd. 19. [NET INCOME.] The term "net income" means the
federal taxable income, as defined in section 63 of the Internal
Revenue Code of 1986, as amended through the date named in this
subdivision, incorporating any elections made by the taxpayer in
accordance with the Internal Revenue Code in determining federal
taxable income for federal income tax purposes, and with the
modifications provided in subdivisions 19a to 19f.
In the case of a regulated investment company or a fund
thereof, as defined in section 851(a) or 851(h) of the Internal
Revenue Code, federal taxable income means investment company
taxable income as defined in section 852(b)(2) of the Internal
Revenue Code, except that:
(1) the exclusion of net capital gain provided in section
852(b)(2)(A) of the Internal Revenue Code does not apply; and
(2) the deduction for dividends paid under section
852(b)(2)(D) of the Internal Revenue Code must be applied by
allowing a deduction for capital gain dividends and
exempt-interest dividends as defined in sections 852(b)(3)(C)
and 852(b)(5) of the Internal Revenue Code.
The net income of a real estate investment trust as defined
and limited by section 856(a), (b), and (c) of the Internal
Revenue Code means the real estate investment trust taxable
income as defined in section 857(b)(2) of the Internal Revenue
Code.
The Internal Revenue Code of 1986, as amended through
December 31, 1986, shall be in effect for taxable years
beginning after December 31, 1986. The provisions of sections
10104, 10202, 10203, 10204, 10206, 10212, 10221, 10222, 10223,
10226, 10227, 10228, 10611, 10631, 10632, and 10711 of the
Omnibus Budget Reconciliation Act of 1987, Public Law Number
100-203, the provisions of sections 1001, 1002, 1003, 1004,
1005, 1006, 1008, 1009, 1010, 1011, 1011A, 1011B, 1012, 1013,
1014, 1015, 1018, 2004, 3041, 4009, 6007, 6026, 6032, 6137,
6277, and 6282 of the Technical and Miscellaneous Revenue Act of
1988, Public Law Number 100-647, and the provisions of sections
7811, 7816, and 7831 of the Omnibus Budget Reconciliation Act of
1989, Public Law Number 101-239, shall be effective at the time
they become effective for federal income tax purposes.
The Internal Revenue Code of 1986, as amended through
December 31, 1987, shall be in effect for taxable years
beginning after December 31, 1987. The provisions of sections
4001, 4002, 4011, 5021, 5041, 5053, 5075, 6003, 6008, 6011,
6030, 6031, 6033, 6057, 6064, 6066, 6079, 6130, 6176, 6180,
6182, 6280, and 6281 of the Technical and Miscellaneous Revenue
Act of 1988, Public Law Number 100-647, and the provisions of
sections 7815 and 7821 of the Omnibus Budget Reconciliation Act
of 1989, Public Law Number 101-239, and the provisions of
section 11702 of the Revenue Reconciliation Act of 1990, Public
Law Number 101-508, shall become effective at the time they
become effective for federal tax purposes.
The Internal Revenue Code of 1986, as amended through
December 31, 1988, shall be in effect for taxable years
beginning after December 31, 1988. The provisions of sections
7101, 7102, 7104, 7105, 7201, 7202, 7203, 7204, 7205, 7206,
7207, 7210, 7211, 7301, 7302, 7303, 7304, 7601, 7621, 7622,
7641, 7642, 7645, 7647, 7651, and 7652 of the Omnibus Budget
Reconciliation Act of 1989, Public Law Number 101-239, and the
provision of section 1401 of the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989, Public Law Number 101-73,
and the provisions of sections 11701 and 11703 of the Revenue
Reconciliation Act of 1990, Public Law Number 101-508, shall
become effective at the time they become effective for federal
tax purposes.
The Internal Revenue Code of 1986, as amended through
December 31, 1989, shall be in effect for taxable years
beginning after December 31, 1989. The provisions of sections
11321, 11322, 11324, 11325, 11403, 11404, 11410, and 11521 of
the Revenue Reconciliation Act of 1990, Public Law Number
101-508, shall become effective at the time they become
effective for federal purposes.
The Internal Revenue Code of 1986, as amended through
December 31, 1990, shall be in effect for taxable years
beginning after December 31, 1990.
Except as otherwise provided, references to the Internal
Revenue Code in subdivisions 19a to 19g mean the code in effect
for purposes of determining net income for the applicable year.
Sec. 19. Minnesota Statutes 1990, section 290.01,
subdivision 19a, is amended to read:
Subd. 19a. [ADDITIONS TO FEDERAL TAXABLE INCOME.] For
individuals, estates, and trusts, there shall be added to
federal taxable income:
(1)(i) interest income on obligations of any state other
than Minnesota or a political or governmental subdivision,
municipality, or governmental agency or instrumentality of any
state other than Minnesota exempt from federal income taxes
under the Internal Revenue Code or any other federal statute,
and
(ii) exempt-interest dividends as defined in section
852(b)(5) of the Internal Revenue Code, except the portion of
the exempt-interest dividends derived from interest income on
obligations of the state of Minnesota or its political or
governmental subdivisions, municipalities, governmental agencies
or instrumentalities, but only if the portion of the
exempt-interest dividends from such Minnesota sources paid to
all shareholders represents 95 percent or more of the
exempt-interest dividends that are paid by the regulated
investment company as defined in section 851(a) of the Internal
Revenue Code, or the fund of the regulated investment company as
defined in section 851(h) of the Internal Revenue Code, making
the payment; and
(2) the amount of income taxes paid or accrued within the
taxable year under this chapter and income taxes paid to any
other state or to any province or territory of Canada, to the
extent allowed as a deduction under section 63(d) of the
Internal Revenue Code, but the addition may not be more than the
amount by which the itemized deductions as allowed under section
63(d) of the Internal Revenue Code exceeds the amount of the
standard deduction as defined in section 63(c) of the Internal
Revenue Code. For the purpose of this paragraph, the
disallowance of itemized deductions under section 68 of the
Internal Revenue Code of 1986, income tax is the last itemized
deduction disallowed; and
(3) the capital gain amount of a lump sum distribution to
which the special tax under section 1122(h)(3)(B)(ii) of the Tax
Reform Act of 1986, Public Law Number 99-514, applies.; and
(4) the amount of income taxes paid or accrued within the
taxable year under this chapter and income taxes paid to any
other state or any province or territory of Canada, to the
extent allowed as a deduction in determining federal adjusted
gross income. For the purpose of this paragraph, income taxes
do not include the taxes imposed by sections 290.0922,
subdivision 1, paragraph (b), 290.9727, 290.9728, and 290.9729.
Sec. 20. Minnesota Statutes 1990, section 290.01,
subdivision 19d, is amended to read:
Subd. 19d. [CORPORATIONS; MODIFICATIONS DECREASING FEDERAL
TAXABLE INCOME.] For corporations, there shall be subtracted
from federal taxable income after the increases provided in
subdivision 19c:
(1) the amount of foreign dividend gross-up added to gross
income for federal income tax purposes under section 78 of the
Internal Revenue Code;
(2) the decrease in salary expense for federal income tax
purposes due to claiming the federal jobs credit under section
51 of the Internal Revenue Code;
(3) any dividend (not including any distribution in
liquidation) paid within the taxable year by a national or state
bank to the United States, or to any instrumentality of the
United States exempt from federal income taxes, on the preferred
stock of the bank owned by the United States or the
instrumentality;
(4) amounts disallowed for intangible drilling costs due to
differences between this chapter and the Internal Revenue Code
in taxable years beginning before January 1, 1987, as follows:
(i) to the extent the disallowed costs are represented by
physical property, an amount equal to the allowance for
depreciation under Minnesota Statutes 1986, section 290.09,
subdivision 7, subject to the modifications contained in
subdivision 19e; and
(ii) to the extent the disallowed costs are not represented
by physical property, an amount equal to the allowance for cost
depletion under Minnesota Statutes 1986, section 290.09,
subdivision 8;
(5) the deduction for capital losses pursuant to sections
1211 and 1212 of the Internal Revenue Code, except that:
(i) for capital losses incurred in taxable years beginning
after December 31, 1986, capital loss carrybacks shall not be
allowed;
(ii) for capital losses incurred in taxable years beginning
after December 31, 1986, a capital loss carryover to each of the
15 taxable years succeeding the loss year shall be allowed;
(iii) for capital losses incurred in taxable years
beginning before January 1, 1987, a capital loss carryback to
each of the three taxable years preceding the loss year, subject
to the provisions of Minnesota Statutes 1986, section 290.16,
shall be allowed; and
(iv) for capital losses incurred in taxable years beginning
before January 1, 1987, a capital loss carryover to each of the
five taxable years succeeding the loss year to the extent such
loss was not used in a prior taxable year and subject to the
provisions of Minnesota Statutes 1986, section 290.16, shall be
allowed;
(6) an amount for interest and expenses relating to income
not taxable for federal income tax purposes, if (i) the income
is taxable under this chapter and (ii) the interest and expenses
were disallowed as deductions under the provisions of section
171(a)(2), 265 or 291 of the Internal Revenue Code in computing
federal taxable income;
(7) in the case of mines, oil and gas wells, other natural
deposits, and timber for which percentage depletion was
disallowed pursuant to subdivision 19c, clause (11), a
reasonable allowance for depletion based on actual cost. In the
case of leases the deduction must be apportioned between the
lessor and lessee in accordance with rules prescribed by the
commissioner. In the case of property held in trust, the
allowable deduction must be apportioned between the income
beneficiaries and the trustee in accordance with the pertinent
provisions of the trust, or if there is no provision in the
instrument, on the basis of the trust's income allocable to
each;
(8) for certified pollution control facilities placed in
service in a taxable year beginning before December 31, 1986,
and for which amortization deductions were elected under section
169 of the Internal Revenue Code of 1954, as amended through
December 31, 1985, an amount equal to the allowance for
depreciation under Minnesota Statutes 1986, section 290.09,
subdivision 7;
(9) the amount included in federal taxable income
attributable to the credits provided in Minnesota Statutes 1986,
section 273.1314, subdivision 9, or Minnesota Statutes, section
469.171, subdivision 6;
(10) amounts included in federal taxable income that are
due to refunds of income, excise, or franchise taxes based on
net income or related minimum taxes paid by the corporation to
Minnesota, another state, a political subdivision of another
state, the District of Columbia, or a foreign country or
possession of the United States to the extent that the taxes
were added to federal taxable income under section 290.01,
subdivision 19c, clause (1), in a prior taxable year;
(11) the following percentage of royalties, fees, or other
like income accrued or received from a foreign operating
corporation or a foreign corporation which is part of the same
unitary business as the receiving corporation:
Taxable Year
Beginning After .......... Percentage
December 31, 1988 ........ 50 percent
December 31, 1990 ........ 80 percent; and
(12) income or gains from the business of mining as defined
in section 290.05, subdivision 1, clause (a), that are not
subject to Minnesota franchise tax; and
(13) the amount of handicap access expenditures in the
taxable year which are not allowed to be deducted or capitalized
under section 44(d)(7) of the Internal Revenue Code of 1986.
Sec. 21. Minnesota Statutes 1990, section 290.06,
subdivision 2c, is amended to read:
Subd. 2c. [SCHEDULES OF RATES FOR INDIVIDUALS, ESTATES,
AND TRUSTS.] (a) The income taxes imposed by this chapter upon
married individuals filing joint returns and surviving spouses
as defined in section 2(a) of the Internal Revenue Code of 1986
as amended through December 31, 1989, must be computed by
applying to their taxable net income the following schedule of
rates:
if taxable income is: the tax is:
not over $19,000 6 percent
over $19,000 $1,140 plus 8 percent of
the excess over $19,000
plus an amount computed using the following schedule of rates:
if taxable income is: the tax is:
over $75,500, but not 0.5 percent of the
over $165,000 excess over $75,500
over $165,000 $447.50
(1) On the first $19,910, 6 percent;
(2) All over $19,910, but not over $79,120, 8 percent;
(3) All over $79,120, 8.5 percent.
Married individuals filing separate returns, estates, and
trusts must compute their income tax by applying the above rates
to their taxable income, except that the income brackets will be
one-half of the above amounts. In the case of married
individuals filing separately, the additional 0.5 percent tax
provided in this subdivision shall be applied to taxable income
over $37,750, but not over $127,500.
(b) The income taxes imposed by this chapter upon unmarried
individuals must be computed by applying to taxable net income
the following schedule of rates:
if taxable income is: the tax is:
not over $13,000 6 percent
over $13,000 $780 plus 8 percent
of the excess over $13,000
plus an amount computed using the following schedule of rates:
if taxable income is: the tax is:
over $42,700, but not 0.5 percent of the
over $93,000 excess over $42,700
over $93,000 $251.50
(1) On the first $13,620, 6 percent;
(2) On all over $13,620, but not over $44,750, 8 percent;
(3) On all over $44,750, 8.5 percent.
(c) The income taxes imposed by this chapter upon unmarried
individuals qualifying as a head of household as defined in
section 2(b) of the Internal Revenue Code of 1986, as amended
through December 31, 1989, must be computed by applying to
taxable net income the following schedule of rates:
if taxable income is: the tax is:
not over $16,000 6 percent
over $16,000 $960 plus 8 percent
of the excess over $16,000
plus an amount computed using the following schedule of rates:
if taxable income is: the tax is:
over $64,300, but not 0.5 percent of the
over $135,000 excess over $64,300
over $135,000 $353.50
(1) On the first $16,770, 6 percent;
(2) On all over $16,770, but not over $67,390, 8 percent;
(3) On all over $67,390, 8.5 percent.
(d) In lieu of a tax computed according to the rates set
forth in this subdivision, the tax of any individual taxpayer
whose taxable net income for the taxable year is less than an
amount determined by the commissioner must be computed in
accordance with tables prepared and issued by the commissioner
of revenue based on income brackets of not more than $100. The
amount of tax for each bracket shall be computed at the rates
set forth in this subdivision, provided that the commissioner
may disregard a fractional part of a dollar unless it amounts to
50 cents or more, in which case it may be increased to $1.
(e) An individual who is not a Minnesota resident for the
entire year must compute the individual's Minnesota income tax
as provided in this subdivision. After the application of the
nonrefundable credits provided in this chapter, the tax
liability must then be multiplied by a fraction in which:
(1) The numerator is the individual's Minnesota source
federal adjusted gross income as defined in section 62 of the
Internal Revenue Code of 1986, as amended through December 31,
1989, less the deduction allowed by section 217 of the Internal
Revenue Code of 1986, as amended through December 31, 1990,
after applying the allocation and assignability provisions of
section 290.081, clause (a), or 290.17; and
(2) the denominator is the individual's federal adjusted
gross income as defined in section 62 of the Internal Revenue
Code of 1986, as amended through December 31, 1989 1990,
increased by the addition required for interest income from
non-Minnesota state and municipal bonds under section 290.01,
subdivision 19a, clause (1).
Sec. 22. Minnesota Statutes 1990, section 290.06,
subdivision 2d, is amended to read:
Subd. 2d. [INFLATION ADJUSTMENT OF BRACKETS.] (a) For
taxable years beginning after December 31, 1990 1991, the
minimum and maximum dollar amounts for each rate bracket for
which a tax is imposed in subdivision 2c shall be adjusted for
inflation by the percentage determined under paragraph (b). For
the purpose of making the adjustment as provided in this
subdivision all of the rate brackets provided in subdivision 2c
shall be the rate brackets as they existed for taxable years
beginning after December 31, 1987 1990, and before January
1, 1991 1992. The rate applicable to any rate bracket must not
be changed. The dollar amounts setting forth the tax shall be
adjusted to reflect the changes in the rate brackets. The rate
brackets as adjusted must be rounded to the nearest $10 amount.
If the rate bracket ends in $5, it must be rounded up to the
nearest $10 amount.
(b) The commissioner shall adjust the rate brackets and by
the percentage determined pursuant to the provisions of section
1(f) of the Internal Revenue Code of 1986, as amended through
December 31, 1989 1990, except that in section 1(f)(3)(B) the
word "1989" "1990" shall be substituted for the word "1987."
For 1991, the commissioner shall then determine the percent
change from the 12 months ending on August 31, 1989 1990, to the
12 months ending on August 31, 1990 1991, and in each subsequent
year, from the 12 months ending on August 31, 1989 1990, to the
12 months ending on August 31 of the year preceding the taxable
year. The determination of the commissioner pursuant to this
subdivision shall not be considered a "rule" and shall not be
subject to the administrative procedure act contained in chapter
14.
No later than December 15 of each year, the commissioner
shall announce the specific percentage that will be used to
adjust the tax rate brackets.
Sec. 23. Minnesota Statutes 1990, section 290.06,
subdivision 22, is amended to read:
Subd. 22. [CREDIT FOR TAXES PAID TO ANOTHER STATE.] (a) A
taxpayer who is liable for taxes on or measured by net income to
another state or province or territory of Canada, as provided in
paragraphs (b) through (f), upon income allocated or apportioned
to Minnesota, is entitled to a credit for the tax paid to
another state or province or territory of Canada if the tax is
actually paid in the taxable year or a subsequent taxable year.
A taxpayer who is a resident of this state pursuant to section
290.01, subdivision 7, clause (2), and who is subject to income
tax as a resident in the state of the individual's domicile is
not allowed this credit unless the state of domicile does not
allow a similar credit.
(b) For an individual, estate, or trust, the credit is
determined by multiplying the tax payable under this chapter by
the ratio derived by dividing the income subject to tax in the
other state or province or territory of Canada that is also
subject to tax in Minnesota while a resident of Minnesota by the
taxpayer's federal adjusted gross income, as defined in section
62 of the Internal Revenue Code of 1986, as amended through
December 31, 1989, modified by the addition required by section
290.01, subdivision 19a, clause (1), and the subtraction allowed
by section 290.01, subdivision 19b, clause (1), to the extent
the income is allocated or assigned to Minnesota under sections
290.081 and 290.17.
(c) If the taxpayer is an athletic team that apportions all
of its income under section 290.17, subdivision 5, paragraph
(c), the credit is determined by multiplying the tax payable
under this chapter by the ratio derived from dividing the total
net income subject to tax in the other state or province or
territory of Canada by the taxpayer's Minnesota taxable income.
(d) The credit determined under paragraph (b) or (c) shall
not exceed the amount of tax so paid to the other state or
province or territory of Canada on the gross income earned
within the other state or province or territory of Canada
subject to tax under this chapter, nor shall the allowance of
the credit reduce the taxes paid under this chapter to an amount
less than what would be assessed if such income amount was
excluded from taxable net income.
(e) In the case of the tax assessed on a lump sum
distribution under section 290.032, the credit allowed under
paragraph (a) is the tax assessed by the other state or province
or territory of Canada on the lump sum distribution that is also
subject to tax under section 290.032, and shall not exceed the
tax assessed under section 290.032. To the extent the total
lump sum distribution defined in section 290.032, subdivision 1,
includes lump sum distributions received in prior years or is
all or in part an annuity contract, the reduction to the tax on
the lump sum distribution allowed under section 290.032,
subdivision 2, includes tax paid to another state that is
properly apportioned to that distribution.
(f) If a Minnesota resident reported an item of income to
Minnesota and is assessed tax in such other state or province or
territory of Canada on that same income after the Minnesota
statute of limitations has expired, the taxpayer shall receive a
credit for that year under paragraph (a), notwithstanding any
statute of limitations to the contrary. The claim for the
credit must be submitted within one year from the date the taxes
were paid to the other state or province or territory of
Canada. The taxpayer must submit sufficient proof to show
entitlement to a credit.
(g) For the purposes of this subdivision, a resident
shareholder of a corporation having a valid election in effect
under section 1362 of the Internal Revenue Code of 1986, as
amended through December 31, 1990, must be considered to have
paid a tax imposed on the shareholder in an amount equal to the
shareholder's pro rata share of any net income tax paid by the S
corporation to a state that does not measure the income of the
shareholder of the S corporation by reference to the income of
the S corporation. For the purposes of the preceding sentence,
the term "net income tax" means any tax imposed on or measured
by a corporation's net income.
Sec. 24. Minnesota Statutes 1990, section 290.06,
subdivision 23, is amended to read:
Subd. 23. [REFUND OF CONTRIBUTIONS TO POLITICAL PARTIES
AND CANDIDATES.] (a) A taxpayer may claim a credit refund equal
to the amount of the taxpayer's contributions made in the
calendar year to candidates and to any political party. The
maximum credit refund for an individual must not exceed $50 and,
for a married couple filing jointly, must not exceed $100.
A credit for refund of a contribution is allowed only if the
taxpayer files a form required by the commissioner and attaches
to the form a copy of an official credit refund receipt form
issued by the candidate or party and signed by the candidate,
the treasurer of the candidate's principal campaign committee,
or the party chair. A claim must be filed with the commissioner
not sooner than September 1 of the calendar year in which the
contribution is made and no later than April 15 of the calendar
year following the calendar year in which the contribution is
made. A taxpayer may file only one claim per calendar year.
Amounts paid by the commissioner after June 15 of the calendar
year following the calendar year in which the contribution is
made must include interest at the rate specified in section
270.76.
(b) No credit refund is allowed under this subdivision for
a contribution to any candidate who unless the candidate:
(1) has not signed an agreement to limit campaign
expenditures as provided in section 10A.322, or 10A.43, and;
(2) is seeking an office for whom which voluntary spending
limits are specified in section 10A.25 or 10A.43; and
(3) has designated a principal campaign committee.
This subdivision does not limit the campaign expenditure of
a candidate who does not sign an agreement but accepts a
contribution for which the contributor improperly claims
a credit refund.
(c) For purposes of this subdivision, "political party"
means a major political party as defined in section 200.02,
subdivision 7, or a minor political party qualifying for
inclusion on the income tax or property tax refund form under
section 10A.31, subdivision 3a. A "major or minor party"
includes the aggregate of the party organization within each
house of the legislature, the state party organization, and the
party organization within congressional districts, counties,
legislative districts, municipalities, and precincts.
"Candidate" means a congressional candidate as defined in
section 10A.41, subdivision 4, or a candidate as defined in
section 10A.01, subdivision 5, but does not include except a
candidate for judicial office. Beginning January 1, 1991,
"candidate" also means a candidate for the United States Senate
or United States House of Representatives from
Minnesota. "Contribution" means a gift of money.
(d) The commissioner shall include a copy of the credit
form with the instructions for the long and short individual
taxation forms. The commissioner shall make copies of the form
available to the public and candidates upon request.
(e) The following data collected or maintained by the
commissioner under this subdivision are private: the identities
of individuals claiming a credit refund, the identities of
candidates to whom those individuals have made contributions,
and the amount of each contribution.
(f) The amount necessary to pay claims for the credit
refund provided in this section is appropriated from the general
fund to the commissioner of revenue.
Sec. 25. Minnesota Statutes 1990, section 290.067,
subdivision 1, is amended to read:
Subdivision 1. [AMOUNT OF CREDIT.] A taxpayer may take as
a credit against the tax due from the taxpayer and a spouse, if
any, under this chapter an amount equal to the dependent care
credit for which the taxpayer is eligible pursuant to the
provisions of section 21 of the Internal Revenue Code subject to
the limitations provided in subdivision 2 except that in
determining whether the child qualified as a dependent, income
received as an aid to families with dependent children grant or
allowance to or on behalf of the child must not be taken into
account in determining whether the child received more than half
of the child's support from the taxpayer, and the provisions of
section 32(b)(1)(D) of the Internal Revenue Code of 1986, as
amended through December 31, 1990, do not apply.
If a child who is six years of age or less at the close of
the taxable year is cared for at a licensed family day care home
operated by the child's parent, the taxpayer is deemed to have
paid employment-related expenses. If the child is 16 months old
or younger at the close of the taxable year, the amount of
expenses deemed to have been paid equals the maximum limit for
one qualified individual under section 21(c) and (d) of the
Internal Revenue Code. If the child is older than 16 months of
age but not older than six years of age at the close of the
taxable year, the amount of expenses deemed to have been paid
equals the amount the licensee would charge for the care of a
child of the same age for the same number of hours of care.
These deemed amounts apply regardless of whether any
employment-related expenses have been paid.
If the taxpayer is not required and does not file a federal
individual income tax return for the tax year, no credit is
allowed for any amount paid to any person unless:
(1) the name, address, and taxpayer identification number
of the person are included on the return claiming the credit; or
(2) if the person is an organization described in section
501(c)(3) of the Internal Revenue Code and exempt from tax under
section 501(a) of the Internal Revenue Code, the name and
address of the person are included on the return claiming the
credit.
In the case of a failure to provide the information required
under the preceding sentence, the preceding sentence does not
apply if it is shown that the taxpayer exercised due diligence
in attempting to provide the information required.
In the case of a nonresident, part-year resident, or a
person whose tax is computed under section 290.06, subdivision
2c, paragraph (f) who has earned income not subject to tax under
this chapter, the credit determined under section 21 of the
Internal Revenue Code must be allocated based on the ratio by
which the earned income of the claimant and the claimant's
spouse from Minnesota sources bears to the total earned income
of the claimant and the claimant's spouse.
Sec. 26. Minnesota Statutes 1990, section 290.067,
subdivision 2a, is amended to read:
Subd. 2a. [INCOME.] (a) For purposes of this section,
"income" means the sum of the following:
(1) the greater of federal adjusted gross income as defined
in section 62 of the Internal Revenue Code or zero; and
(2) the sum of the following amounts to the extent not
included in clause (1):
(i) all nontaxable income;
(ii) the amount of a passive activity loss that is not
disallowed as a result of section 469, paragraph (i) or (1) (m)
of the Internal Revenue Code and the amount of passive activity
loss carryover allowed under section 469(b) of the Internal
Revenue Code;
(iii) an amount equal to the total of any discharge of
qualified farm indebtedness of a solvent individual excluded
from gross income under section 108(g) of the Internal Revenue
Code;
(iv) cash public assistance and relief;
(v) any pension or annuity (including railroad retirement
benefits, all payments received under the federal Social
Security Act, supplemental security income, and veterans
benefits), which was not exclusively funded by the claimant or
spouse, or which was funded exclusively by the claimant or
spouse and which funding payments were excluded from federal
adjusted gross income in the years when the payments were made;
(vi) interest received from the federal or a state
government or any instrumentality or political subdivision
thereof;
(vii) workers' compensation;
(viii) nontaxable strike benefits;
(ix) the gross amounts of payments received in the nature
of disability income or sick pay as a result of accident,
sickness, or other disability, whether funded through insurance
or otherwise;
(x) the ordinary income portion of a lump sum distribution
under section 402(e)(3) of the Internal Revenue Code; and
(xi) contributions made by the claimant to an individual
retirement account, including a qualified voluntary employee
contribution; simplified employee pension plan; self-employed
retirement plan; cash or deferred arrangement plan under section
401(k) of the Internal Revenue Code; or deferred compensation
plan under section 457 of the Internal Revenue Code; and
(xii) nontaxable scholarship or fellowship grants.
In the case of an individual who files an income tax return
on a fiscal year basis, the term "federal adjusted gross income"
means federal adjusted gross income reflected in the fiscal year
ending in the next calendar year. Federal adjusted gross income
may not be reduced by the amount of a net operating loss
carryback or carryforward or a capital loss carryback or
carryforward allowed for the year.
(b) "Income" does not include:
(1) amounts excluded pursuant to the Internal Revenue Code,
sections 101(a), 102, and 121;
(2) amounts of any pension or annuity that were exclusively
funded by the claimant or spouse if the funding payments were
not excluded from federal adjusted gross income in the years
when the payments were made;
(c) surplus food or other relief in kind supplied by a
governmental agency;
(d) relief granted under chapter 290A; and
(e) child support payments received under a temporary or
final decree of dissolution or legal separation.
Sec. 27. [290.0671] [MINNESOTA WORKING FAMILY CREDIT.]
Subdivision 1. [CREDIT ALLOWED.] An individual is allowed
a credit against the tax imposed by this chapter equal to ten
percent of the credit for which the individual is eligible under
section 32 of the Internal Revenue Code of 1986, as amended
through December 31, 1990.
For a nonresident, part-year resident, or person who has
earned income not subject to tax under this chapter, the credit
determined under section 32 of the Internal Revenue Code of
1986, as amended through December 31, 1990, must be allocated
based on the percentage of the total earned income of the
claimant and the claimant's spouse that is derived from
Minnesota sources.
Subd. 2. [CREDIT NAME.] The credit allowed by this section
shall be known as the "Minnesota working family credit."
Subd. 3. [REDUCTION BY ALTERNATIVE MINIMUM TAX LIABILITY.]
The amount of the credit allowed must be reduced by the amount
of the taxpayer's liability under section 290.091, determined
before the credit allowed by this section is subtracted from
regular tax liability.
Subd. 4. [CREDIT REFUNDABLE.] If the amount of credit
which the claimant is eligible to receive under this section
exceeds the claimant's tax liability under this chapter, the
commissioner shall refund the excess to the claimant.
Subd. 5. [CALCULATION ASSISTANCE.] Upon request of the
individual and submission of the necessary information, in the
form prescribed by the commissioner, the department of revenue
shall calculate the credit on behalf of the individual.
Subd. 6. [APPROPRIATION.] An amount sufficient to pay the
refunds required by this section is appropriated to the
commissioner from the general fund.
Sec. 28. Minnesota Statutes 1990, section 290.0802,
subdivision 1, is amended to read:
Subdivision 1. [DEFINITIONS.] For purposes of this
section, the following terms have the meanings given.
(a) "Adjusted gross income" means federal adjusted gross
income as used in section 22(d) of the Internal Revenue Code for
the taxable year, plus the ordinary income portion of a lump sum
distribution as defined in section 402(e)(3) of the Internal
Revenue Code, and less any pension, annuity, or disability
benefits paid under the Railroad Retirement Act of 1974 that are
included in federal gross income but are not subject to state
taxation other than the subtraction allowed under section
290.01, subdivision 19b, clause (4).
(b) "Disability income" means disability income as defined
in section 22(c)(2)(B)(iii) of the Internal Revenue Code.
(c) "Internal Revenue Code" means the Internal Revenue Code
of 1986, as amended through December 31, 1989.
(d) "Nontaxable retirement and disability benefits" means
the amount of pension, annuity, or disability benefits that
would be included in the reduction under section 22(c)(3) of the
Internal Revenue Code and pension, annuity, or disability
benefits paid under the Railroad Retirement Act of 1974 that are
included in federal gross income but are not subject to state
taxation other than the subtraction allowed under section
290.01, subdivision 19b, clause (4).
(e) "Qualified individual" means a qualified individual as
defined in section 22(b) of the Internal Revenue Code.
Sec. 29. Minnesota Statutes 1990, section 290.091,
subdivision 1, is amended to read:
Subdivision 1. [IMPOSITION OF TAX.] In addition to all
other taxes imposed by this chapter a tax is imposed on
individuals, estates, and trusts equal to the excess (if any) of
(a) an amount equal to six seven percent of alternative
minimum taxable income after subtracting the exemption amount,
over
(b) the regular tax for the taxable year.
Sec. 30. Minnesota Statutes 1990, section 290.091,
subdivision 2, is amended to read:
Subd. 2. [DEFINITIONS.] For purposes of the tax imposed by
this section, the following terms have the meanings given:
(a) "Alternative minimum taxable income" means the sum of
the following for the taxable year:
(1) the taxpayer's federal alternative minimum taxable
income as defined in section 55(b)(2) of the Internal Revenue
Code;
(2) the taxpayer's itemized deductions allowed in computing
federal alternative minimum taxable income, but excluding the
Minnesota charitable contribution deduction and non-Minnesota
charitable deductions to the extent they are included in federal
alternative minimum taxable income under section 57(a)(6) of the
Internal Revenue Code, and excluding the medical expense
deduction;
(3) to the extent not included in federal alternative
minimum taxable income, the amount of interest income as
provided by section 290.01, subdivision 19a, clause (1); less
the sum of
(i) interest income as defined in section 290.01,
subdivision 19b, clause (1);
(ii) an overpayment of state income tax as provided by
section 290.01, subdivision 19b, clause (2); and
(iii) the amount of investment interest paid or accrued
within the taxable year on indebtedness to the extent that the
amount does not exceed net investment income, as defined in
section 163(d)(4) of the Internal Revenue Code. Interest does
not include amounts deducted in computing federal adjusted gross
income.
In the case of an estate or trust, alternative minimum
taxable income must be computed as provided in section 59(c) of
the Internal Revenue Code.
(b) "Internal Revenue Code" means the Internal Revenue Code
of 1986, as amended through December 31, 1989.
(c) "Investment interest" means investment interest as
defined in section 163(d)(3) of the Internal Revenue Code.
(d) "Tentative minimum tax" equals six percent of
alternative minimum taxable income after subtracting the
exemption amount determined under subdivision 3.
(e) "Regular tax" means the tax that would be imposed under
this chapter (without regard to this section and section
290.032), reduced by the sum of the nonrefundable credits
allowed under this chapter.
(f) "Net minimum tax" means the minimum tax imposed by this
section.
(g) "Minnesota charitable contribution deduction" means a
charitable contribution deduction under section 170 of the
Internal Revenue Code to or for the use of an entity described
in section 290.21, subdivision 3, clauses (a) to (e).
Sec. 31. Minnesota Statutes 1990, section 290.0922, is
amended by adding a subdivision to read:
Subd. 4. [PARTNER'S PRO RATA SHARE.] For the purposes of
this section, a partner's pro rata share of a partnership's
property, payroll, and sales or receipts is not included in the
property, payroll, and sales or receipts of the partner.
Sec. 32. Minnesota Statutes 1990, section 290.17,
subdivision 1, is amended to read:
Subdivision 1. [SCOPE OF ALLOCATION RULES.] (a) The income
of resident individuals is not subject to allocation outside
this state. The allocation rules apply to nonresident
individuals, estates, trusts, nonresident partners of
partnerships, nonresident shareholders of corporations having a
valid election in effect under section 1362 of the Internal
Revenue Code of 1986, as amended through December 31, 1989, and
all corporations not having such an election in effect. If a
partnership or corporation would not otherwise be subject to the
allocation rules, but conducts a trade or business that is part
of a unitary business involving another legal entity that is
subject to the allocation rules, the partnership or corporation
is subject to the allocation rules.
(b) Expenses, losses, and other deductions (referred to
collectively in this paragraph as "deductions") must be
allocated along with the item or class of gross income to which
they are definitely related for purposes of assignment under
this section or apportionment under section 290.191, 290.20,
290.35, or 290.36. Deductions not definitely related to any
item or class of gross income are assigned to the taxpayer's
domicile.
(c) The application of the allocation rules as they apply
to income, gains, losses, deductions, or credits of (1) a
partner's distributable share from a partnership under section
290.31, subdivision 4; (2) a shareholder's distributable share
from an S corporation provided in section 1366 of the Internal
Revenue Code of 1986, as amended through December 31, 1989; (3)
a beneficiary's distributable share from an estate or trust as
provided in section 290.23, subdivision 9; or (4) the
shareholders of regulated investment companies, real estate
investment trusts, and real estate mortgage investment conduits
as provided in subchapter M of the Internal Revenue Code of
1988, as amended through December 31, 1989, shall be determined
by the resident status of the partner, beneficiary, or
shareholder at the end of the taxable year of the partnership,
estate or trust, or corporation. In the case of an individual
who is a resident for only part of a taxable year, the
individual's income, gains, losses, and deductions from the
distributive share of a partnership, S corporation, trust, or
estate are not subject to allocation outside this state to the
extent of the distributive share multiplied by a ratio, the
numerator of which is the number of days the individual was a
resident of this state during the tax year of the partnership, S
corporation, trust, or estate, and the denominator of which is
the number of days in the taxable year of the partnership, S
corporation, trust, or estate.
Sec. 33. Minnesota Statutes 1990, section 290.17,
subdivision 2, is amended to read:
Subd. 2. [INCOME NOT DERIVED FROM CONDUCT OF A TRADE OR
BUSINESS.] The income of a taxpayer subject to the allocation
rules that is not derived from the conduct of a trade or
business must be assigned in accordance with paragraphs (a) to
(f):
(a)(1) Subject to paragraphs (a)(2) and (a)(3), income from
labor or personal or professional services is assigned to this
state if, and to the extent that, the labor or services are
performed within it; all other income from such sources is
treated as income from sources without this state.
Severance pay shall be considered income from labor or
personal or professional services.
(2) In the case of an individual who is a nonresident of
Minnesota and who is an athlete or entertainer, income from
compensation for labor or personal services performed within
this state shall be determined in the following manner:
(i) The amount of income to be assigned to Minnesota for an
individual who is a nonresident salaried athletic team employee
shall be determined by using a fraction in which the denominator
contains the total number of days in which the individual is
under a duty to perform for the employer, and the numerator is
the total number of those days spent in Minnesota; and
(ii) The amount of income to be assigned to Minnesota for
an individual who is a nonresident, and who is an athlete or
entertainer not listed in clause (i), for that person's athletic
or entertainment performance in Minnesota shall be determined by
assigning to this state all income from performances or athletic
contests in this state.
(3) For purposes of this section, amounts received by a
nonresident from the United States, its agencies or
instrumentalities, the Federal Reserve Bank, the state of
Minnesota or any of its political or governmental subdivisions,
or a Minnesota volunteer firefighters' relief association, by
way of payment as a pension, public employee retirement benefit,
or any combination of these, or as a retirement or survivor's
benefit made from a plan qualifying under section 401, 403, 408,
or 409, or as defined in section 403(b) or 457 of the Internal
Revenue Code of 1986, as amended through December 31, 1989, are
not considered income derived from carrying on a trade or
business or from performing personal or professional services in
Minnesota, and are not taxable under this chapter.
(b) Income or gains from tangible property located in this
state that is not employed in the business of the recipient of
the income or gains must be assigned to this state.
(c) Except upon the sale of a partnership interest or the
sale of stock of an S corporation, income or gains from
intangible personal property not employed in the business of the
recipient of the income or gains must be assigned to this state
if the recipient of the income or gains is a resident of this
state or is a resident trust or estate.
Gain on the sale of a partnership interest is allocable to
this state in the ratio of the original cost of partnership
tangible property in this state to the original cost of
partnership tangible property everywhere, determined at the time
of the sale. If more than 50 percent of the value of the
partnership's assets consists of intangibles, gain or loss from
the sale of the partnership interest is allocated to this state
in accordance with the sales factor of the partnership for its
first full tax period immediately preceding the tax period of
the partnership during which the partnership interest was sold.
Gain on the sale of stock held in an S corporation is
allocable to this state in an amount equal to the gain on the
sale of the stock multiplied by the ratio that was used to
compute the amount of S corporation income assignable to
Minnesota in the tax year preceding the year of sale.
Gain on the sale of goodwill or income from a covenant not
to compete that is connected with a business operating all or
partially in Minnesota is allocated to this state to the extent
that the income from the business in the year preceding the year
of sale was assignable to Minnesota under subdivision 3.
(d) Income from the operation of a farm shall be assigned
to this state if the farm is located within this state and to
other states only if the farm is not located in this state.
(e) Income from winnings on Minnesota pari-mutuel betting
tickets, the Minnesota state lottery, and lawful gambling as
defined in section 349.12, subdivision 24, conducted within the
boundaries of the state of Minnesota shall be assigned to this
state.
(f) All items of gross income not covered in paragraphs (a)
to (e) and not part of the taxpayer's income from a trade or
business shall be assigned to the taxpayer's domicile.
Sec. 34. Minnesota Statutes 1990, section 290.92,
subdivision 1, is amended to read:
Subdivision 1. [DEFINITIONS.] (1) [WAGES.] For purposes of
this section, the term "wages" means the same as that term is
defined in section 3401(a) and (f) of the Internal Revenue Code
of 1986, as amended through December 31, 1988 1990, except wages
shall not include agricultural labor as defined in section
3121(g) of the Internal Revenue Code of 1986, as amended through
December 31, 1990.
(2) [PAYROLL PERIOD.] For purposes of this section the term
"payroll period" means a period for which a payment of wages is
ordinarily made to the employee by the employee's employer, and
the term "miscellaneous payroll period" means a payroll period
other than a daily, weekly, biweekly, semimonthly, monthly,
quarterly, semiannual, or annual payroll period.
(3) [EMPLOYEE.] For purposes of this section the term
"employee" means any resident individual performing services for
an employer, either within or without, or both within and
without the state of Minnesota, and every nonresident individual
performing services within the state of Minnesota, the
performance of which services constitute, establish, and
determine the relationship between the parties as that of
employer and employee. As used in the preceding sentence, the
term "employee" includes an officer of a corporation, and an
officer, employee, or elected official of the United States, a
state, or any political subdivision thereof, or the District of
Columbia, or any agency or instrumentality of any one or more of
the foregoing.
(4) [EMPLOYER.] For purposes of this section the term
"employer" means any person, including individuals, fiduciaries,
estates, trusts, partnerships, and corporations transacting
business in or deriving any income from sources within the state
of Minnesota for whom an individual performs or performed any
service, of whatever nature, as the employee of such person,
except that if the person for whom the individual performs or
performed the services does not have legal control of the
payment of the wages for such services, the term "employer,"
except for purposes of paragraph (1), means the person having
legal control of the payment of such wages. As used in the
preceding sentence, the term "employer" includes any
corporation, individual, estate, trust, or organization which is
exempt from taxation under section 290.05 and further includes,
but is not limited to, officers of corporations who have legal
control, either individually or jointly with another or others,
of the payment of the wages.
(5) [NUMBER OF WITHHOLDING EXEMPTIONS CLAIMED.] For
purposes of this section, the term "number of withholding
exemptions claimed" means the number of withholding exemptions
claimed in a withholding exemption certificate in effect under
subdivision 5, except that if no such certificate is in effect,
the number of withholding exemptions claimed shall be considered
to be zero.
Sec. 35. Minnesota Statutes 1990, section 290.92,
subdivision 4b, is amended to read:
Subd. 4b. [WITHHOLDING BY PARTNERSHIPS.] (a) A partnership
shall deduct and withhold a tax as provided in paragraph
(b) when the partnership pays or credits amounts to any of
its for nonresident individual partners on account of based on
their distributive shares of partnership income for a taxable
year of the partnership.
(b) The amount of tax withheld is determined by multiplying
the partner's distributive share allocable to Minnesota under
section 290.17, paid or credited during the taxable year by the
highest rate used to determine the income tax liability for an
individual under section 290.06, subdivision 2c, except that the
amount of tax withheld may be determined based on tables
provided by the commissioner if the partner submits a
withholding exemption certificate under subdivision 5.
(c) The commissioner may reduce or abate the tax withheld
under this subdivision if the partnership had reasonable cause
to believe that no tax was due under this section.
(d) Notwithstanding paragraph (a), a partnership is not
required to deduct and withhold tax for a nonresident partner if:
(1) the partner elects to have the tax due paid as part of
the partnership's composite return under section 290.39,
subdivision 5;
(2) the partner has Minnesota assignable federal adjusted
gross income from the partnership of less than $1,000; or
(3) the partnership is liquidated or terminated, the income
was generated by a transaction related to the termination or
liquidation, and no cash or other property was distributed in
the current or prior taxable year; or
(4) the distributive shares of partnership income are
attributable to:
(i) income required to be recognized because of discharge
of indebtedness;
(ii) income recognized because of a sale, exchange, or
other disposition of real estate, depreciable property, or
property described in section 179 of the Internal Revenue Code
of 1986, as amended through December 31, 1989; or
(iii) income recognized on the sale, exchange, or other
disposition of any property that has been the subject of a basis
reduction pursuant to section 108, 734, 743, 754, or 1017 of the
Internal Revenue Code of 1986, as amended through December 31,
1989,
to the extent that the income does not include cash received or
receivable or, if there is cash received or receivable, to the
extent that the cash is required to be used to pay indebtedness
by the partnership or a secured debt on partnership property.
(e) For purposes of subdivision 6a, and sections 289A.09,
subdivision 2, 289A.20, subdivision 2, paragraph (c), 289A.50,
289A.56, 289A.60, and 289A.63, a partnership is considered an
employer.
(f) To the extent that income is exempt from withholding
under paragraph (d), clause (4), the commissioner has a lien in
an amount up to the amount that would be required to be withheld
with respect to the income of the partner attributable to the
partnership interest, but for the application of paragraph (d),
clause (4). The lien arises under section 270.69 from the date
of assessment of the tax against the partner, and attaches to
that partner's share of the profits and any other money due or
to become due to that partner in respect of the partnership.
Notice of the lien may be sent by mail to the partnership,
without the necessity for recording the lien. The notice has
the force and effect of a levy under section 270.70, and is
enforceable against the partnership in the manner provided by
that section. Upon payment in full of the liability subsequent
to the notice of lien, the partnership must be notified that the
lien has been satisfied.
Sec. 36. Minnesota Statutes 1990, section 290.92,
subdivision 4c, is amended to read:
Subd. 4c. [WITHHOLDING BY SMALL BUSINESS S CORPORATIONS.]
(a) A corporation having a valid election in effect under
section 290.9725 shall deduct and withhold a tax as provided in
paragraph (b) when it pays or credits amounts to any of its for
nonresident individual shareholders as dividends or as their
share of the corporations's undistributed taxable income for the
taxable year.
(b) The amount of tax withheld is determined by multiplying
the amount of dividends or undistributed income allocable to
Minnesota under section 290.17, paid or credited to a
nonresident shareholder during the taxable year by the highest
rate used to determine the income tax liability of an individual
under section 290.06, subdivision 2c, except that the amount of
tax withheld may be determined based on tables provided by the
commissioner if the shareholder submits a withholding exemption
certificate under subdivision 5.
(c) Notwithstanding paragraph (a), a corporation is not
required to deduct and withhold tax for a nonresident
shareholder, if:
(1) the shareholder elects to have the tax due paid as part
of the corporation's composite return under section 290.39,
subdivision 5;
(2) the shareholder has Minnesota assignable federal
adjusted gross income from the corporation of less than $1,000;
or
(3) the corporation is liquidated or terminated, the income
was generated by a transaction related to the termination or
liquidation, and no cash or other property was distributed in
the current or prior taxable year.
(d) For purposes of subdivision 6a, and sections 289A.09,
subdivision 2, 289A.20, subdivision 2, paragraph (c), 289A.50,
289A.56, 289A.60, and 289A.63, a corporation is considered an
employer.
Sec. 37. Minnesota Statutes 1990, section 290.92,
subdivision 12, is amended to read:
Subd. 12. [WITHHELD AMOUNT, CREDIT AGAINST TAX.] (a) The
amount deducted and withheld as tax under subdivision 2a, or 3,
4b, or 4c or section 290.923, subdivision 2, during any a
calendar year upon the wages, partnership income, or "S"
corporation income of any individual or person receiving royalty
payments shall be allowed as a credit to the recipient of the
income against the taxes imposed by this chapter or by chapter
298, for a taxable year beginning in such calendar year. If
more than one taxable year begins in such calendar year, such
amount shall be allowed as a credit against the taxes for the
last taxable year so beginning.
(b) The amount deducted and withheld under subdivisions 4b
and 4c and under section 290.923, subdivision 2, for
partnership, S corporation, or royalty income must be allowed as
a credit to the recipient of the income against the taxes
imposed by this chapter for the tax year the income is subject
to tax under this chapter.
Sec. 38. Minnesota Statutes 1990, section 290.92,
subdivision 26, is amended to read:
Subd. 26. [EXTENSION OF WITHHOLDING TO CERTAIN PAYMENTS
WHERE IDENTIFYING NUMBER NOT FURNISHED OR INACCURATE.] (a) If,
in the case of any reportable payment, (1) the payee fails to
furnish the payee's social security account number to the payor,
or (2) the commissioner notifies the payor that the social
security account number furnished by the payee is incorrect,
then the payor shall deduct and withhold from the payment a tax
equal to ten percent of the payment the amount of the payment
multiplied by the highest rate used in determining the income
tax liability of an individual under section 290.06, subdivision
2c.
(b)(1) In the case of any failure described in clause
(a)(1), clause (a) shall apply to any reportable payment made by
the payor during the period during which the social security
account number has not been furnished.
(2) In any case where there is a notification described in
clause (a)(2), clause (a) shall apply to any reportable payment
made by the payor (i) after the close of the 30th day after the
day on which the payor received the notification, and (ii)
before the payee furnishes another social security account
number.
(3)(i) Unless the payor elects not to have this
subparagraph apply with respect to the payee, clause (a) shall
also apply to any reportable payment made after the close of the
period described in paragraph (1) or (2) (as the case may be)
and before the 30th day after the close of the period.
(ii) If the payor elects the application of this
subparagraph with respect to the payee, clause (a) shall also
apply to any reportable payment made during the 30-day period
described in paragraph (2).
(iii) The payor may elect a period shorter than the grace
period set forth in subparagraph (i) or (ii) as the case may be.
(c) The provisions of section 3406 of the Internal Revenue
Code of 1986, as amended through December 31, 1989, shall apply
and shall govern when withholding shall be required and the
definition of terms. The term "reportable payment" shall
include only those payments for personal services. No tax shall
be deducted or withheld under this subdivision with respect to
any amount for which withholding is otherwise required under
this section. For purposes of this section, payments which are
subject to withholding under this subdivision shall be treated
as if they were wages paid by an employer to an employee and
amounts deducted and withheld under this subdivision shall be
treated as if deducted and withheld under subdivision 2a.
(d) Whenever the commissioner notifies a payor under this
subdivision that the social security account number furnished by
any payee is incorrect, the commissioner shall at the same time
furnish a copy of the notice to the payor, and the payor shall
promptly furnish the copy to the payee. If the commissioner
notifies a payor under this subdivision that the social security
account number furnished by any payee is incorrect and the payee
subsequently furnishes another social security account number to
the payor, the payor shall promptly notify the commissioner of
the other social security account number furnished.
Sec. 39. Minnesota Statutes 1990, section 290.92,
subdivision 27, is amended to read:
Subd. 27. [PARI-MUTUEL WINNINGS.] Any holder of a class A,
B, or D license issued by the Minnesota racing commission shall
deduct and withhold ten percent of the payment of winnings which
are subject to withholding an amount equal to the winnings
multiplied by the highest rate used in determining the income
tax liability of an individual under section 290.06, subdivision
2c, as Minnesota withholding tax. For purposes of this
subdivision, the term "winnings which are subject to
withholding" has the meaning given in section 3402(q)(3) of the
Internal Revenue Code of 1986, as amended through December 31,
1989. For purposes of the provisions of this section, a payment
to any person of winnings which are subject to withholding must
be treated as if the payment was a wage paid by an employer to
an employee. Every individual who is to receive a payment of
winnings which are subject to withholding shall furnish the
license holder with a statement, made under the penalties of
perjury, containing the name, address, and social security
account number of the person receiving the payment and of each
person entitled to any portion of such payment. The license
holder is liable for the payment of the tax required to be
withheld under this subdivision and subdivision 28 but is not
liable to any person for the amount of the payment.
Sec. 40. Minnesota Statutes 1990, section 290A.03,
subdivision 3, is amended to read:
Subd. 3. [INCOME.] (1) "Income" means the sum of the
following:
(a) federal adjusted gross income as defined in the
Internal Revenue Code; and
(b) the sum of the following amounts to the extent not
included in clause (a):
(i) all nontaxable income;
(ii) the amount of a passive activity loss that is not
disallowed as a result of section 469, paragraph (i) or (1) (m)
of the Internal Revenue Code and the amount of passive activity
loss carryover allowed under section 469(b) of the Internal
Revenue Code;
(iii) an amount equal to the total of any discharge of
qualified farm indebtedness of a solvent individual excluded
from gross income under section 108(g) of the Internal Revenue
Code;
(iv) cash public assistance and relief;
(v) any pension or annuity (including railroad retirement
benefits, all payments received under the federal Social
Security Act, supplemental security income, and veterans
benefits), which was not exclusively funded by the claimant or
spouse, or which was funded exclusively by the claimant or
spouse and which funding payments were excluded from federal
adjusted gross income in the years when the payments were made;
(vi) interest received from the federal or a state
government or any instrumentality or political subdivision
thereof;
(vii) workers' compensation;
(viii) nontaxable strike benefits;
(ix) the gross amounts of payments received in the nature
of disability income or sick pay as a result of accident,
sickness, or other disability, whether funded through insurance
or otherwise;
(x) a lump sum distribution under section 402(e)(3) of the
Internal Revenue Code;
(xi) contributions made by the claimant to an individual
retirement account, including a qualified voluntary employee
contribution; simplified employee pension plan; self-employed
retirement plan; cash or deferred arrangement plan under section
401(k) of the Internal Revenue Code; or deferred compensation
plan under section 457 of the Internal Revenue Code; and
(xii) nontaxable scholarship or fellowship grants.
In the case of an individual who files an income tax return
on a fiscal year basis, the term "federal adjusted gross income"
shall mean federal adjusted gross income reflected in the fiscal
year ending in the calendar year. Federal adjusted gross income
shall not be reduced by the amount of a net operating loss
carryback or carryforward or a capital loss carryback or
carryforward allowed for the year.
(2) "Income" does not include
(a) amounts excluded pursuant to the Internal Revenue Code,
sections 101(a), 102, and 121;
(b) amounts of any pension or annuity which was exclusively
funded by the claimant or spouse and which funding payments were
not excluded from federal adjusted gross income in the years
when the payments were made;
(c) surplus food or other relief in kind supplied by a
governmental agency;
(d) relief granted under this chapter; or
(e) child support payments received under a temporary or
final decree of dissolution or legal separation.
(3) The sum of the following amounts may be subtracted from
income:
(a) for the claimant's first dependent, the exemption
amount multiplied by 1.4;
(b) for the claimant's second dependent, the exemption
amount multiplied by 1.3;
(c) for the claimant's third dependent, the exemption
amount multiplied by 1.2;
(d) for the claimant's fourth dependent, the exemption
amount multiplied by 1.1;
(e) for the claimant's fifth dependent, the exemption
amount; and
(f) if the claimant or claimant's spouse was disabled or
attained the age of 65 prior to June 1 of the year for which the
taxes were levied or rent paid, the exemption amount.
For purposes of this subdivision, the "exemption amount"
means the exemption amount under section 151(d) of the Internal
Revenue Code of 1986, as amended through December 31, 1989, for
the taxable year for which the income is reported.
Sec. 41. Minnesota Statutes 1990, section 290A.03,
subdivision 7, is amended to read:
Subd. 7. [DEPENDENT.] "Dependent" means any person who is
considered a dependent under sections 151 and 152 of the
Internal Revenue Code of 1986, as amended through December 31,
1989. In the case of a son, stepson, daughter, or stepdaughter
of the claimant, amounts received as an aid to families with
dependent children grant or allowance to or on behalf of the
child must not be taken into account in determining whether the
child received more than half of the child's support from the
claimant. "Dependent" includes a parent of the claimant or
spouse who lives in the claimant's homestead.
Sec. 42. Minnesota Statutes 1990, section 290A.05, is
amended to read:
290A.05 [COMBINED HOUSEHOLD INCOME.]
If a person occupies a homestead with another person or
persons not related to the person as husband and wife, excluding
dependents, roomers or boarders on contract, and has property
tax payable with respect to the homestead, the household income
of the claimant or claimants for the purpose of computing the
refund allowed by section 290A.04 shall include the total income
received by the other persons residing in the homestead. For
purposes of this section, "dependent" includes a parent of the
claimant or spouse who lives in the claimant's homestead and
does not have an ownership interest in the homestead. If a
person occupies a homestead with another person or persons not
related as husband and wife or as dependents, the property tax
payable or rent constituting property tax shall be reduced as
follows.
If the other person or persons are residing at the
homestead under rental or lease agreement, the amount of
property tax payable or rent constituting property tax shall be
that portion not covered by the rental agreement.
Sec. 43. Minnesota Statutes 1990, section 290A.091, is
amended to read:
290A.091 [CLAIMS OF TENANTS IN LEASEHOLD COOPERATIVES.]
The cooperative manager of a leasehold cooperative shall
furnish a statement to each tenant by March 31 of the year in
which the property tax is payable showing each unit's share of
the gross property tax and each unit's share of any property tax
credits. Each tenant may apply for a property tax refund under
this chapter as a homeowner based on each tenant's share of
property taxes. The tenant may not include any rent
constituting property taxes paid on that unit. For the purposes
of this section, a leasehold cooperative is formed on the day
that leasehold cooperative status is granted by the appropriate
county official.
Sec. 44. [FEDERAL CHANGES.]
The changes made by sections 11301, 11302, 11303, 11304,
11305, 11343, 11344, 11531, 11601, 11602, 11701, 11702, 11703,
and 11704 of the Revenue Reconciliation Act of 1990, Public Law
Number 101-508, which affect the definition of net income of
insurance companies as defined in Minnesota Statutes, section
290.35, the definition of alternative minimum taxable income as
defined in Minnesota Statutes, sections 290.091, subdivision 2,
and 290.0921, subdivision 3, grantor as defined in Minnesota
Statutes, section 290.25, federal gross estate as defined in
Minnesota Statutes, section 291.005, gross income as defined in
Minnesota Statutes, section 290.01, subdivision 20, and the
definition of wages as defined in Minnesota Statutes, section
290.92, subdivision 1, shall be effective at the same time they
become effective for federal tax purposes.
The waiver of estimated tax penalties provided by section
11307 of the Revenue Reconciliation Act of 1990 shall also apply
to Minnesota to the extent the underpayment was created or
increased by the changes made by sections 11301, 11302, 11303,
and 11305.
Sec. 45. [ESTIMATED TAXES; EXCEPTIONS.]
No addition to tax, penalties, or interest may be made
under Minnesota Statutes, section 289A.25, for any period before
September 15, 1991, with respect to an underpayment of estimated
tax, to the extent that the underpayment was created or
increased by the increase in tax rates under this article.
Sec. 46. [INSTRUCTION TO REVISOR.]
In the next edition of Minnesota Statutes, the revisor of
statutes shall substitute the phrase "Internal Revenue Code of
1986, as amended through December 31, 1990" for the words
"Internal Revenue Code of 1986, as amended through December 31,
1989" wherever the phrase occurs in chapters 289A, 290, 290A,
and 291, except for section 290.01, subdivision 19.
Sec. 47. [REPEALER.]
Minnesota Statutes 1990, section 289A.19, subdivision 6, is
repealed.
Sec. 48. [EFFECTIVE DATE.]
Sections 1 to 5 and 24 are effective the day following
final enactment. Sections 6, 13, 15, 17, except paragraph (e),
35 to 40 are effective July 1, 1991. Sections 17, paragraph
(e), and 47 are effective beginning for refunds based on
property taxes payable in 1991 and for refunds based on rent
constituting property taxes paid in 1990. Section 25 is
effective for taxable years beginning after December 31, 1991,
except the disallowance of the provisions of section 32 of the
Internal Revenue Code of 1986. Sections 30, except the
allowance of the medical expense deduction, and 31 are effective
for taxable years beginning after December 31, 1989. Sections
41 to 43 are effective for refunds based on rents paid in 1991
and property taxes payable in 1992 and applications for
leasehold cooperative status filed with the county after
December 31, 1990. Except where otherwise specifically
provided, the rest of this article is effective for taxable
years beginning after December 31, 1990.
ARTICLE 7
CORPORATIONS
Section 1. Minnesota Statutes 1990, section 289A.18,
subdivision 1, is amended to read:
Subdivision 1. [INDIVIDUAL INCOME, FIDUCIARY INCOME,
CORPORATE FRANCHISE, AND ENTERTAINMENT TAXES; PARTNERSHIP AND S
CORPORATION RETURNS; INFORMATION RETURNS.] The returns required
to be made under sections 289A.08 and 289A.12 must be filed at
the following times:
(1) returns made on the basis of the calendar year must be
filed on April 15 following the close of the calendar year,
except that returns of corporations must be filed on March 15
following the close of the calendar year;
(2) returns made on the basis of the fiscal year must be
filed on the 15th day of the fourth month following the close of
the fiscal year, except that returns of corporations must be
filed on the 15th day of the third month following the close of
the fiscal year;
(3) returns for a fractional part of a year must be filed
on the 15th day of the fourth month following the end of the
month in which falls the last day of the period for which the
return is made, except that the returns of corporations must be
filed on the 15th day of the third month following the end of
the month in which falls the last day of the period for which
the return is made;
(4) in the case of a final return of a decedent for a
fractional part of a year, the return must be filed on the 15th
day of the fourth month following the close of the 12-month
period that began with the first day of that fractional part of
a year;
(5) in the case of the return of a cooperative association,
returns must be filed on or before the 15th day of the ninth
month following the close of the taxable year;
(6) if a corporation has been divested from a unitary group
and files a return for a fractional part of a year in which it
was a member of a unitary business that files a combined report
under section 290.34, subdivision 2, the divested corporation's
return must be filed on the 15th day of the third month
following the close of the common accounting period that
includes the fractional year; and
(7) returns of entertainment entities must be filed on
April 15 following the close of the calendar year; and
(8) returns required to be filed under section 289A.08,
subdivision 4, must be filed on the 15th day of the fifth month
following the close of the taxable year.
Sec. 2. Minnesota Statutes 1990, section 289A.26,
subdivision 1, is amended to read:
Subdivision 1. [MINIMUM LIABILITY.] A corporation subject
to taxation under chapter 290 (excluding section 290.92) or an
entity subject to taxation under section 290.05, subdivision 3,
must make payment of estimated tax for the taxable year if its
tax liability so computed can reasonably be expected to exceed
$500, or in accordance with rules prescribed by the commissioner
for an affiliated group of corporations electing to file one
return as permitted under section 289A.08, subdivision 3.
Sec. 3. Minnesota Statutes 1990, section 289A.26,
subdivision 6, is amended to read:
Subd. 6. [PERIOD OF UNDERPAYMENT.] The period of the
underpayment runs from the date the installment was required to
be paid to the earlier of the following dates:
(1) the 15th day of the third month following the close of
the taxable year for corporations, and the 15th day of the fifth
month following the close of the taxable year for entities
subject to tax under section 290.05, subdivision 3; or
(2) with respect to any part of the underpayment, the date
on which that part is paid. For purposes of this clause, a
payment of estimated tax shall be credited against unpaid
required installments in the order in which those installments
are required to be paid.
Sec. 4. Minnesota Statutes 1990, section 290.01,
subdivision 19d, is amended to read:
Subd. 19d. [CORPORATIONS; MODIFICATIONS DECREASING FEDERAL
TAXABLE INCOME.] For corporations, there shall be subtracted
from federal taxable income after the increases provided in
subdivision 19c:
(1) the amount of foreign dividend gross-up added to gross
income for federal income tax purposes under section 78 of the
Internal Revenue Code;
(2) the decrease in amount of salary expense not allowed
for federal income tax purposes due to claiming the federal jobs
credit under section 51 of the Internal Revenue Code;
(3) any dividend (not including any distribution in
liquidation) paid within the taxable year by a national or state
bank to the United States, or to any instrumentality of the
United States exempt from federal income taxes, on the preferred
stock of the bank owned by the United States or the
instrumentality;
(4) amounts disallowed for intangible drilling costs due to
differences between this chapter and the Internal Revenue Code
in taxable years beginning before January 1, 1987, as follows:
(i) to the extent the disallowed costs are represented by
physical property, an amount equal to the allowance for
depreciation under Minnesota Statutes 1986, section 290.09,
subdivision 7, subject to the modifications contained in
subdivision 19e; and
(ii) to the extent the disallowed costs are not represented
by physical property, an amount equal to the allowance for cost
depletion under Minnesota Statutes 1986, section 290.09,
subdivision 8;
(5) the deduction for capital losses pursuant to sections
1211 and 1212 of the Internal Revenue Code, except that:
(i) for capital losses incurred in taxable years beginning
after December 31, 1986, capital loss carrybacks shall not be
allowed;
(ii) for capital losses incurred in taxable years beginning
after December 31, 1986, a capital loss carryover to each of the
15 taxable years succeeding the loss year shall be allowed;
(iii) for capital losses incurred in taxable years
beginning before January 1, 1987, a capital loss carryback to
each of the three taxable years preceding the loss year, subject
to the provisions of Minnesota Statutes 1986, section 290.16,
shall be allowed; and
(iv) for capital losses incurred in taxable years beginning
before January 1, 1987, a capital loss carryover to each of the
five taxable years succeeding the loss year to the extent such
loss was not used in a prior taxable year and subject to the
provisions of Minnesota Statutes 1986, section 290.16, shall be
allowed;
(6) an amount for interest and expenses relating to income
not taxable for federal income tax purposes, if (i) the income
is taxable under this chapter and (ii) the interest and expenses
were disallowed as deductions under the provisions of section
171(a)(2), 265 or 291 of the Internal Revenue Code in computing
federal taxable income;
(7) in the case of mines, oil and gas wells, other natural
deposits, and timber for which percentage depletion was
disallowed pursuant to subdivision 19c, clause (11), a
reasonable allowance for depletion based on actual cost. In the
case of leases the deduction must be apportioned between the
lessor and lessee in accordance with rules prescribed by the
commissioner. In the case of property held in trust, the
allowable deduction must be apportioned between the income
beneficiaries and the trustee in accordance with the pertinent
provisions of the trust, or if there is no provision in the
instrument, on the basis of the trust's income allocable to
each;
(8) for certified pollution control facilities placed in
service in a taxable year beginning before December 31, 1986,
and for which amortization deductions were elected under section
169 of the Internal Revenue Code of 1954, as amended through
December 31, 1985, an amount equal to the allowance for
depreciation under Minnesota Statutes 1986, section 290.09,
subdivision 7;
(9) the amount included in federal taxable income
attributable to the credits provided in Minnesota Statutes 1986,
section 273.1314, subdivision 9, or Minnesota Statutes, section
469.171, subdivision 6;
(10) amounts included in federal taxable income that are
due to refunds of income, excise, or franchise taxes based on
net income or related minimum taxes paid by the corporation to
Minnesota, another state, a political subdivision of another
state, the District of Columbia, or a foreign country or
possession of the United States to the extent that the taxes
were added to federal taxable income under section 290.01,
subdivision 19c, clause (1), in a prior taxable year;
(11) the following percentage of royalties, fees, or other
like income accrued or received from a foreign operating
corporation or a foreign corporation which is part of the same
unitary business as the receiving corporation:
Taxable Year
Beginning After .......... Percentage
December 31, 1988 ........ 50 percent
December 31, 1990 ........ 80 percent; and
(12) income or gains from the business of mining as defined
in section 290.05, subdivision 1, clause (a), that are not
subject to Minnesota franchise tax.; and
(13) the amount of qualified research expenses not allowed
for federal income tax purposes under section 280C(c) of the
Internal Revenue Code, but only to the extent that the amount
exceeds the amount of the credit allowed under section 290.068.
Sec. 5. Minnesota Statutes 1990, section 290.014,
subdivision 2, is amended to read:
Subd. 2. [NONRESIDENT INDIVIDUALS.] Income of Except as
provided in section 290.015, a nonresident individual is subject
to tax under this chapter and a nonresident individual is
subject to the return filing requirements under and to tax as
provided in this chapter to the extent that the income of the
nonresident individual is:
(1) allocable to this state under section 290.17, 290.191,
or 290.20;
(2) taxed to the individual under the Internal Revenue Code
of 1986, as amended through December 31, 1989, (or not taxed
under the Internal Revenue Code by reason of its character but
of a character which is taxable under this chapter) in the
individual's capacity as a beneficiary of an estate with income
allocable to this state under section 290.17, 290.191, or 290.20
and the income, taking into account the income character
provisions of section 662(b) of the Internal Revenue Code of
1986, as amended through December 31, 1989, would be allocable
to this state under section 290.17, 290.191, or 290.20 if
realized by the individual directly from the source from which
realized by the estate;
(3) taxed to the individual under the Internal Revenue Code
of 1986, as amended through December 31, 1989, (or not taxed
under the Internal Revenue Code by reason of its character but
of a character that is taxable under this chapter) in the
individual's capacity as a beneficiary or grantor or other
person treated as a substantial owner of a trust with income
allocable to this state under section 290.17, 290.191, or 290.20
and the income, taking into account the income character
provisions of section 652(b), 662(b), or 664(b) of the Internal
Revenue Code of 1986, as amended through December 31, 1989,
would be allocable to this state under section 290.17, 290.191,
or 290.20 if realized by the individual directly from the source
from which realized by the trust;
(4) taxed to the individual under the Internal Revenue Code
of 1986, as amended through December 31, 1989, (or not taxed
under the Internal Revenue Code by reason of its character but
of a character which is taxable under this chapter) in the
individual's capacity as a limited or general partner in a
partnership with income allocable to this state under section
290.17, 290.191, or 290.20 and the income, taking into account
the income character provisions of section 702(b) of the
Internal Revenue Code of 1986, as amended through December 31,
1989, would be allocable to this state under section 290.17,
290.191, or 290.20 if realized by the individual directly from
the source from which realized by the partnership; or
(5) taxed to the individual under the Internal Revenue Code
of 1986, as amended through December 31, 1989, (or not taxed
under the Internal Revenue Code by reason of its character but
of a character which is taxable under this chapter) in the
individual's capacity as a shareholder of a corporation having a
valid election in effect under section 1362 of the Internal
Revenue Code of 1986, as amended through December 31, 1989, and
income allocable to this state under section 290.17, 290.191, or
290.20 and the income, taking into account the income character
provisions of section 1366(b) of the Internal Revenue Code of
1986, as amended through December 31, 1989, would be allocable
to this state under section 290.17, 290.191, or 290.20 if
realized by the individual directly from the source from which
realized by the corporation.
Sec. 6. Minnesota Statutes 1990, section 290.014,
subdivision 3, is amended to read:
Subd. 3. [TRUSTS AND ESTATES.] Except as provided in
section 290.015, a trust or estate, whether resident or
nonresident, is subject to the return filing requirements under
and to tax as provided in this chapter and the income of a trust
or estate is subject to tax under this chapter to the extent
that the income of the trust or estate is:
(1) allocable to this state under section 290.17, 290.191,
or 290.20;
(2) taxed to the trust or estate under the Internal Revenue
Code of 1986, as amended through December 31, 1989, (or not
taxed under the Internal Revenue Code by reason of its character
but of a character which is taxable under this chapter) in its
capacity as a beneficiary of a trust or estate with income
allocable to this state under section 290.17, 290.191, or 290.20
and the income, taking into account the income character
provisions of section 662(b) of the Internal Revenue Code of
1986, as amended through December 31, 1989, would be allocable
to this state under section 290.17, 290.191, or 290.20 if
realized by the trust or beneficiary estate directly from the
source from which realized by the distributing estate;
(3) taxed to the trust or estate under the Internal Revenue
Code of 1986, as amended through December 31, 1989, (or not
taxed under the Internal Revenue Code by reason of its character
but of a character which is taxable under this chapter) in its
capacity as a beneficiary or grantor or other person treated as
a substantial owner of a trust with income allocable to this
state under section 290.17, 290.191, or 290.20 and the income,
taking into account the income character provisions of section
652(b), 662(b), or 664(b) of the Internal Revenue Code of 1986,
as amended through December 31, 1989, would be allocable to this
state under section 290.17, 290.191, or 290.20 if realized by
the beneficiary trust or estate directly from the source from
which realized by the distributing trust;
(4) taxed to the trust or estate under the Internal Revenue
Code of 1986, as amended through December 31, 1989, (or not
taxed under the Internal Revenue Code by reason of its character
but of a character which is taxable under this chapter) in its
capacity as a limited or general partner in a partnership with
income allocable to this state under section 290.17, 290.191, or
290.20 and the income, taking into account the income character
provisions of section 702(b) of the Internal Revenue Code of
1986, as amended through December 31, 1989, would be allocable
to this state under section 290.17, 290.191, or 290.20 if
realized by the trust or estate directly from the source from
which realized by the partnership; or
(5) taxed to the trust or estate under the Internal Revenue
Code of 1986, as amended through December 31, 1989, (or not
taxed under the Internal Revenue Code by reason of its character
but of a character which is taxable under this chapter) in its
capacity as a shareholder of a corporation having a valid
election in effect under section 1362 of the Internal Revenue
Code of 1986, as amended through December 31, 1989, and income
allocable to this state under section 290.17, 290.191, or 290.20
and the income, taking into account the income character
provisions of section 1366(b) of the Internal Revenue Code of
1986, as amended through December 31, 1989, would be allocable
to this state under section 290.17, 290.191, or 290.20 if
realized by the trust or estate directly from the source from
which realized by the corporation.
Sec. 7. Minnesota Statutes 1990, section 290.014,
subdivision 4, is amended to read:
Subd. 4. [PARTNERSHIPS.] Except as provided in section
290.015, a partnership is not subject to tax under this chapter
but is subject to the return filing requirements under and to
tax as provided in this chapter and its partners are subject to
tax under this chapter on their shares of partnership income to
the extent that if the income of the partnership is:
(1) allocable to this state under section 290.17, 290.191,
or 290.20;
(2) taxed to the partnership under the Internal Revenue
Code of 1986, as amended through December 31, 1989, (or not
taxed under the Internal Revenue Code by reason of its character
but of a character which is taxable under this chapter) in its
capacity as a beneficiary of an estate with income allocable to
this state under section 290.17, 290.191, or 290.20 and the
income, taking into account the income character provisions of
section 662(b) of the Internal Revenue Code of 1986, as amended
through December 31, 1989, would be allocable to this state
under section 290.17, 290.191, or 290.20 if realized by the
partnership directly from the source from which realized by the
estate;
(3) taxed to the partnership under the Internal Revenue
Code of 1986, as amended through December 31, 1989, (or not
taxed under the Internal Revenue Code by reason of its character
but of a character which is taxable under this chapter) in its
capacity as a beneficiary or grantor or other person treated as
a substantial owner of a trust with income allocable to this
state under section 290.17, 290.191, or 290.20 and the income,
taking into account the income character provisions of section
652(b), 662(b), or 664(b) of the Internal Revenue Code of 1986,
as amended through December 31, 1989, would be allocable to this
state under section 290.17, 290.191, or 290.20 if realized by
the partnership directly from the source from which realized by
the trust; or
(4) taxed to the partnership under the Internal Revenue
Code of 1986, as amended through December 31, 1989, (or not
taxed under the Internal Revenue Code by reason of its character
but of a character which is taxable under this chapter) in its
capacity as a limited or general partner in a partnership with
income allocable to this state under section 290.17, 290.191, or
290.20 and the income, taking into account the income character
provisions of section 702(b) of the Internal Revenue Code of
1986, as amended through December 31, 1989, would be allocable
to this state under section 290.17, 290.191, or 290.20 if
realized by the second tier partnership directly from the source
from which realized by the first tier partnership.
Sec. 8. Minnesota Statutes 1990, section 290.014,
subdivision 5, is amended to read:
Subd. 5. [CORPORATIONS.] A corporation having a valid
election in effect under section 1362 of the Internal Revenue
Code of 1986, as amended through December 31, 1989, is not
subject to tax under this chapter, except as provided in section
290.9725, but its shareholders are, and it is subject to the
return filing requirements. Except as provided in section
290.015, corporations are subject to the return filing
requirements and to tax under as provided in this chapter if the
corporation so exercises its franchise as to engage in such
contacts with this state as to cause part of the income of the
corporation to be:
(1) allocable to this state under section 290.17, 290.191,
290.20, 290.35, or 290.36;
(2) taxed to the corporation under the Internal Revenue
Code of 1986, as amended through December 31, 1989, (or not
taxed under the Internal Revenue Code by reason of its character
but of a character which is taxable under this chapter) in its
capacity as a beneficiary of an estate with income allocable to
this state under section 290.17, 290.191, or 290.20 and the
income, taking into account the income character provisions of
section 662(b) of the Internal Revenue Code of 1986, as amended
through December 31, 1989, would be allocable to this state
under section 290.17, 290.191, or 290.20 if realized by the
corporation directly from the source from which realized by the
estate;
(3) taxed to the corporation under the Internal Revenue
Code of 1986, as amended through December 31, 1989, (or not
taxed under the Internal Revenue Code by reason of its character
but of a character which is taxable under this chapter) in its
capacity as a beneficiary or grantor or other person treated as
a substantial owner of a trust with income allocable to this
state under section 290.17, 290.191, or 290.20 and the income,
taking into account the income character provisions of section
652(b), 662(b), or 664(b) of the Internal Revenue Code of 1986,
as amended through December 31, 1989, would be allocable to this
state under section 290.17, 290.191, or 290.20 if realized by
the corporation directly from the source from which realized by
the trust; or
(4) taxed to the corporation under the Internal Revenue
Code of 1986, as amended through December 31, 1989, (or not
taxed under the Internal Revenue Code by reason of its character
but of a character which is taxable under this chapter) in its
capacity as a limited or general partner in a partnership with
income allocable to this state under section 290.17, 290.191, or
290.20 and the income, taking into account the income character
provisions of section 702(b) of the Internal Revenue Code of
1986, as amended through December 31, 1989, would be allocable
to this state under section 290.17, 290.191, or 290.20 if
realized by the corporation directly from the source from which
realized by the partnership.
Sec. 9. Minnesota Statutes 1990, section 290.05,
subdivision 3, is amended to read:
Subd. 3. (a) An organization exempt from taxation under
subdivision 2 shall, nevertheless, be subject to tax under this
chapter to the extent provided in the following provisions of
the Internal Revenue Code:
(i) section 527 (dealing with political organizations);
(ii) section 528 (dealing with certain homeowners
associations); and
(iii) sections 511 to 515 (dealing with unrelated business
income); and
(iv) section 521 (dealing with farmers' cooperatives); but
notwithstanding this subdivision, shall be considered an
organization exempt from income tax for the purposes of any law
which refers to organizations exempt from income taxes.
(b) The tax shall be imposed on the taxable income of
political organizations or homeowner associations or the
unrelated business taxable income, as defined in section 512 of
the Internal Revenue Code, of organizations defined in section
511 of the Internal Revenue Code, provided that the tax is not
imposed on advertising revenues from a newspaper published by an
organization described in section 501(c)(4) of the Internal
Revenue Code. The tax shall be at the corporate rates. The tax
shall only be imposed on income and deductions assignable to
this state under sections 290.17 to 290.20. To the extent
deducted in computing federal taxable income, the deductions
contained in section 290.21 shall not be allowed in computing
Minnesota taxable net income.
Sec. 10. Minnesota Statutes 1990, section 290.06,
subdivision 21, is amended to read:
Subd. 21. [ALTERNATIVE MINIMUM TAX; FACTORS TAX.] (a) A
corporation is allowed a credit for alternative minimum tax
previously paid for any taxable year in which the corporation
has no tax liability under section 290.092, subdivision 1, and
has an alternative minimum tax credit carryover from a previous
year. The credit allowable in any taxable year equals the
lesser of (1) the excess of the tax under subdivision 1 for the
taxable year over the amount computed under section 290.092,
subdivision 1, clause (1), for the taxable year, or (2) the
alternative minimum tax credit carryover to the taxable year.
(b) The tax imposed under section 290.092, subdivision 1,
for the taxable year is an alternative minimum tax credit
carryover to each of the five taxable years succeeding the
taxable year. The entire amount of the alternative minimum tax
credit must be carried to the earliest taxable year to which the
amount may be carried. The unused portion of the credit must be
carried to the following taxable year. No credit may be carried
to a taxable year more than five years after the taxable year in
which the alternative minimum tax under section 290.092,
subdivision 1, was incurred.
(c) For taxable years beginning after December 31, 1989,
qualification for a credit and computation of the amount of the
credit for alternative minimum tax under paragraph (a) must be
determined by computing the alternative minimum tax that would
apply if section 290.092 were in effect for the taxable year.
(d) An acquiring corporation may carry over this credit
from a transferor or distributor corporation in a corporate
acquisition. The provisions of section 381 of the Internal
Revenue Code apply in determining the amount of the carryover,
if any.
Sec. 11. Minnesota Statutes 1990, section 290.068,
subdivision 1, is amended to read:
290.068 [CREDIT FOR INCREASING RESEARCH AND EXPERIMENTAL
EXPENDITURES ACTIVITIES.]
Subdivision 1. [CREDIT ALLOWED.] A corporation, other than
a corporation with a valid election in effect under section 1362
of the Internal Revenue Code of 1986, as amended through
December 31, 1989, is allowed a credit against the portion of
the franchise tax computed under section 290.06, subdivision 1,
for the taxable year equal to:
(a) 5 percent of the first $2 million of the excess (if
any) of
(1) the qualified research expenses for the taxable year,
over
(2) the base period research expenses amount; and
(b) 2.5 percent on all of such excess expenses over $2
million.
Sec. 12. Minnesota Statutes 1990, section 290.068,
subdivision 2, is amended to read:
Subd. 2. [DEFINITIONS.] For purposes of this section, the
following terms have the meanings given.
(a) "Qualified research expenses" means (i) qualified
research expenses and basic research payments as defined in
section 41(b) and (e) of the Internal Revenue Code, except
it shall does not include expenses incurred for qualified
research or basic research conducted outside the state of
Minnesota pursuant to section 41(d) and (e) of the Internal
Revenue Code; or and (ii) contributions to a nonprofit
corporation established and operated pursuant to the provisions
of chapter 317A for the purpose of promoting the establishment
and expansion of business in this state, provided the
contributions are invested by the nonprofit corporation for the
purpose of providing funds for small, technologically innovative
enterprises in Minnesota during the early stages of their
development.
(b) "Qualified research" means qualified research as
defined in section 41(d) of the Internal Revenue Code, except
that the term shall does not include qualified research
conducted outside the state of Minnesota.
(c) "Base period research expenses amount" means
base period research expenses amount as defined in section 41(c)
of the Internal Revenue Code, except that "December 31, 1981"
shall be substituted for "June 30, 1981" in subparagraph (B) of
paragraph (2) the average annual gross receipts must be
calculated using Minnesota sales or receipts under section
290.191 and the definitions contained in clauses (a) and (b)
shall apply.
(d) "Internal Revenue Code" means the Internal Revenue Code
of 1986, as amended through December 31, 1989.
Sec. 13. Minnesota Statutes 1990, section 290.068,
subdivision 5, is amended to read:
Subd. 5. [ADJUSTMENTS; ACQUISITIONS AND DISPOSITIONS.] If
a taxpayer acquires or disposes of the major portion of a trade
or business or the major portion of a separate unit of a trade
or business in a transaction with another taxpayer, the
taxpayer's qualified research expenses and base period shall be
amount are adjusted in the same manner provided by section
41(f)(3) of the Internal Revenue Code, except that "December 31,
1980" shall be substituted for "June 30, 1980."
Sec. 14. Minnesota Statutes 1990, section 290.0921,
subdivision 8, is amended to read:
Subd. 8. [CARRYOVER CREDIT.] (a) A corporation is allowed
a credit against qualified regular tax for qualified alternative
minimum tax previously paid. The credit is allowable only if
the corporation has no tax liability under this section for the
taxable year and if the corporation has an alternative minimum
tax credit carryover from a previous year. The credit allowable
in a taxable year equals the lesser of
(1) the excess of the qualified regular tax for the taxable
year over the amount computed under subdivision 1, paragraph
(a), clause (1), for the taxable year or
(2) the carryover credit to the taxable year.
(b) For purposes of this subdivision, the following terms
have the meanings given.
(1) "Qualified alternative minimum tax" equals the amount
determined under subdivision 1 for the taxable year. In
computing the amount of alternative minimum tax
(i) the adjustment under section 56(c)(3) of the Internal
Revenue Code must not be made;
(ii) the full amount of the charitable contribution
deduction under section 290.21, subdivision 3, must be deducted
in computing Minnesota alternative minimum taxable income; and
(iii) in the case of a corporation subject to an occupation
tax under section 298.01 the tax preference for depletion under
section 57(a)(1) of the Internal Revenue Code must be deducted
in computing Minnesota alternative minimum taxable income.
(2) "Qualified regular tax" means the tax imposed under
section 290.06, subdivision 1.
(c) The qualified alternative minimum tax for a taxable
year is an alternative minimum tax credit carryover to each of
the taxable years succeeding the taxable year. The entire
amount of the credit must be carried to the earliest taxable
year to which the amount may be carried. Any unused portion of
the credit must be carried to the following taxable year. No
credit may be carried to a taxable year in which alternative
minimum tax was paid.
(d) An acquiring corporation may carry over this credit
from a transferor or distributor corporation in a corporate
acquisition. The provisions of section 381 of the Internal
Revenue Code apply in determining the amount of the carryover,
if any.
Sec. 15. Minnesota Statutes 1990, section 290.0922,
subdivision 1, is amended to read:
Subdivision 1. [IMPOSITION.] (a) In addition to the tax
imposed by this chapter without regard to this section, the
franchise tax imposed on a corporation required to file under
section 290.37, other than a corporation having a valid election
in effect under section 1362 of the Internal Revenue Code of
1986, as amended through December 31, 1989, for the taxable year
includes a tax equal to the following amounts:
If the sum of the corporation's
Minnesota property, payrolls, and sales
or receipts is: the tax equals:
less than $500,000 $0
$ 500,000 to $ 1,000,000 $ 999,999 $100
$ 1,000,000 to $ 4,999,999 $300
$ 5,000,000 to $ 9,999,999 $1,000
$10,000,000 to $19,999,999 $2,000
$20,000,000 or more $5,000
(b) A tax is imposed annually beginning in 1990 on a
corporation required to file a return under section 290.41,
subdivision 1, that has a valid election in effect for the
taxable year under section 1362 of the Internal Revenue Code of
1986, as amended through December 31, 1989, and on a partnership
required to file a return under section 290.41, subdivision 1,
other than a partnership that derives over 80 percent of its
income from farming. The tax imposed under this paragraph is
due on or before the due date of the return due under section
290.41, subdivision 1, for the calendar year following the
calendar year in which the tax is imposed. The commissioner
shall prescribe the return to be used for payment of this tax.
The tax under this paragraph is equal to the following amounts:
If the sum of the S corporation's or partnership's
Minnesota property, payrolls, and sales
or receipts is: the tax equals:
less than $500,000 $0
$ 500,000 to $ 1,000,000 $ 999,999 $100
$ 1,000,000 to $ 4,999,999 $300
$ 5,000,000 to $ 9,999,999 $1,000
$10,000,000 to $19,999,999 $2,000
$20,000,000 or more $5,000
Sec. 16. Minnesota Statutes 1990, section 290.17,
subdivision 5, is amended to read:
Subd. 5. [SPECIAL RULES RULE.] Notwithstanding
subdivisions 3 and 4, all income from the operation of the
following types of businesses must be allocated as follows:
(a) All income from the operation of a farm is assigned to
this state if the farm is located within this state and no such
income is assigned to this state if the farm is located without
this state.
(b) For an athletic teams team when the visiting team does
not share in the gate receipts, all of the team's income is
assigned to the state in which the team's operation is based.
Sec. 17. Minnesota Statutes 1990, section 290.191,
subdivision 6, is amended to read:
Subd. 6. [DETERMINATION OF RECEIPTS FACTOR FOR FINANCIAL
INSTITUTIONS.] (a) For purposes of this section, the rules in
this subdivision and subdivisions 7 and 8 apply in determining
the receipts factor for financial institutions.
(b) "Receipts" for this purpose means gross income,
including net taxable gain on disposition of assets, including
securities and money market instruments, when derived from
transactions and activities in the regular course of the
taxpayer's trade or business.
(c) "Money market instruments" means federal funds sold and
securities purchased under agreements to resell, commercial
paper, banker's acceptances, and purchased certificates of
deposit and similar instruments to the extent that the
instruments are reflected as assets under generally accepted
accounting principles.
(d) "Securities" means United States Treasury securities,
obligations of United States government agencies and
corporations, obligations of state and political subdivisions,
corporate stock and other securities, participations in
securities backed by mortgages held by United States or state
government agencies, loan-backed securities and similar
investments to the extent the investments are reflected as
assets under generally accepted accounting principles.
(e) Receipts from the lease or rental of real or tangible
personal property, including both finance leases and true
leases, must be attributed to this state if the property is
located in this state. Tangible personal property that is
characteristically moving property, such as motor vehicles,
rolling stock, aircraft, vessels, mobile equipment, and the
like, is considered to be located in a state if:
(1) the operation of the property is entirely within the
state; or
(2) the operation of the property is in two or more states,
but the principal base of operations from which the property is
sent out is in the state.
(f) Interest income and other receipts from assets in the
nature of loans that are secured primarily by real estate or
tangible personal property must be attributed to this state if
the security property is located in this state under the
principles stated in paragraph (e).
(g) Interest income and other receipts from consumer loans
not secured by real or tangible personal property that are made
to residents of this state, whether at a place of business, by
traveling loan officer, by mail, by telephone or other
electronic means, must be attributed to this state.
(h) Interest income and other receipts from commercial
loans and installment obligations that are unsecured by real or
tangible personal property or secured by intangible property
must be attributed to this state if the proceeds of the loan are
to be applied in this state. If it cannot be determined where
the funds are to be applied, the income and receipts are
attributed to the state in which the office of the borrower from
which the application would be made in the regular course of
business is located. If this cannot be determined, the
transaction is disregarded in the apportionment formula.
(i) Interest income and other receipts from a participating
financial institution's portion of participation and syndication
loans must be attributed under paragraphs (e) to (h). A
participation loan is an arrangement in which a lender makes a
loan to a borrower and then sells, assigns, or otherwise
transfers all or a part of the loan to a purchasing financial
institution. A syndication loan is a multibank loan transaction
involving multiple financial institutions in which all the
lenders are named as parties to the loan documentation, are
known to the borrower, and have privity of contract with the
borrower.
(j) Interest income and other receipts including service
charges from financial institution credit card and travel and
entertainment credit card receivables and credit card holders'
fees must be attributed to the state to which the card charges
and fees are regularly billed.
(k) Merchant discount income derived from financial
institution credit card holder transactions with a merchant must
be attributed to the state in which the merchant is located. In
the case of merchants located within and outside the state, only
receipts from merchant discounts attributable to sales made from
locations within the state are attributed to this state. It is
presumed, subject to rebuttal, that the location of a merchant
is the address shown on the invoice submitted by the merchant to
the taxpayer.
(l) Receipts from the performance of fiduciary and other
services must be attributed to the state in which the benefits
of the services are consumed. If the benefits are consumed in
more than one state, the receipts from those benefits must be
apportioned to this state pro rata according to the portion of
the benefits consumed in this state. If the extent to which the
benefits of services are consumed in this state is not readily
determinable, the benefits of the services shall be deemed to be
consumed at the location of the office of the customer from
which the services were ordered in the regular course of the
customer's trade or business. If the ordering office cannot be
determined, the benefits of the services shall be deemed to be
consumed at the office of the customer to which the services are
billed.
(m) Receipts from the issuance of travelers checks and
money orders must be attributed to the state in which the checks
and money orders are purchased.
(n) Receipts from investments of a financial institution in
securities of this state, its political subdivisions, agencies,
and instrumentalities must be attributed to this state.
(o) Receipts from a financial institution's interest in any
property described in section 290.015, subdivision 3, paragraph
(b), is not included in the numerator or the denominator of the
receipts factor provided the financial institution's activities
within this state with respect to any interest in the property
are limited in the manner provided in section 290.015,
subdivision 3, paragraph (b). If a financial institution is
subject to tax under this chapter, its interest in property
described in section 290.015, subdivision 3, paragraph (b), is
included in the receipts factor in the same manner as assets in
the nature of securities or money market instruments are
included under paragraph (n) and subdivision 7. and from money
market instruments must be apportioned to this state based on
the ratio that total deposits from this state, its residents,
including any business with an office or other place of business
in this state, its political subdivisions, agencies, and
instrumentalities bear to the total deposits from all states,
their residents, their political subdivisions, agencies, and
instrumentalities. In the case of an unregulated financial
institution subject to this section, these receipts are
apportioned to this state based on the ratio that its gross
business income, excluding such receipts, earned from sources
within this state bears to gross business income, excluding such
receipts, earned from sources within all states. For purposes
of this subdivision, deposits made by this state, its residents,
its political subdivisions, agencies, and instrumentalities must
be attributed to this state, whether or not the deposits are
accepted or maintained by the taxpayer at locations within this
state.
(o) A financial institution's interest in property
described in section 290.015, subdivision 3, paragraph (b), is
included in the receipts factor in the same manner as assets in
the nature of securities or money market instruments are
included in paragraph (n).
Sec. 18. Minnesota Statutes 1990, section 290.191,
subdivision 8, is amended to read:
Subd. 8. [DEPOSIT; DEFINITION.] (a) "Deposit," as used in
subdivision 7, has the meanings in this subdivision.
(b) "Deposit" means the unpaid balance of money or its
equivalent received or held by a financial institution in the
usual course of business and for which it has given or is
obligated to give credit, either conditionally or
unconditionally, to a commercial, checking, savings, time, or
thrift account whether or not advance notice is required to
withdraw the credited funds, or which is evidenced by its
certificate of deposit, thrift certificate, investment
certificate, or certificate of indebtedness, or other similar
name, or a check or draft drawn against a deposit account and
certified by the financial institution, or a letter of credit or
a traveler's check on which the financial institution is
primarily liable. However, without limiting the generality of
the term "money or its equivalent," any such account or
instrument must be regarded as evidencing the receipt of the
equivalent of money when credited or issued in exchange for
checks or drafts or for a promissory note upon which the person
obtaining the credit or instrument is primarily or secondarily
liable, or for a charge against a deposit account, or in
settlement of checks, drafts, or other instruments forwarded to
the bank for collection.
(c) "Deposit" means trust funds received or held by the
financial institution, whether held in the trust department or
held or deposited in any other department of the financial
institution.
(d) "Deposit" means money received or held by a financial
institution, or the credit given for money or its equivalent
received or held by a financial institution, in the usual course
of business for a special or specific purpose, regardless of the
legal relationship so established. Under this paragraph,
"deposit" includes, but is not limited to, escrow funds, funds
held as security for an obligation due to the financial
institution or others, including funds held as dealers reserves,
or for securities loaned by the bank financial institution,
funds deposited by a debtor to meet maturing obligations, funds
deposited as advance payment on subscriptions to United States
government securities, funds held for distribution or purchase
of securities, funds held to meet its acceptances or letters of
credit, and withheld taxes. It does not include funds received
by the financial institution for immediate application to the
reduction of an indebtedness to the receiving financial
institution, or under condition that the receipt of the funds
immediately reduces or extinguishes the indebtedness.
(e) "Deposit" means outstanding drafts, including advice or
another such institution, cashier's checks, money orders, or
other officer's checks issued in the usual course of business
for any purpose, but not including those issued in payment for
services, dividends, or purchases or other costs or expenses of
the financial institution itself.
(f) "Deposit" means money or its equivalent held as a
credit balance by a financial institution on behalf of its
customer if the entity is engaged in soliciting and holding such
balances in the regular course of its business.
(g) Interinstitution fund transfers are not deposits.
Sec. 19. Minnesota Statutes 1990, section 290.191,
subdivision 11, is amended to read:
Subd. 11. [FINANCIAL INSTITUTIONS; PROPERTY FACTOR.] (a)
For financial institutions, the property factor includes, as
well as tangible property, intangible property as set forth in
this subdivision.
(b) Intangible personal property must be included at its
tax basis for federal income tax purposes.
(c) Goodwill must not be included in the property factor.
(d) Coin and currency located in this state must be
attributed to this state.
(e) Lease financing receivables must be attributed to this
state if and to the extent that the property is located within
this state.
(f) Assets in the nature of loans that are secured by real
or tangible personal property must be attributed to this state
if and to the extent that the security property is located
within this state.
(g) Assets in the nature of consumer loans and installment
obligations that are unsecured or secured by intangible property
must be attributed to this state if the loan was made to a
resident of this state.
(h) Assets in the nature of commercial loan and installment
obligations that are unsecured by real or tangible personal
property or secured by intangible property must be attributed to
this state if the proceeds of the loan are to be applied in this
state. If it cannot be determined where the funds are to be
applied, the assets must be attributed to the state in which
there is located the office of the borrower from which the
application would be made in the regular course of business. If
this cannot be determined, the transaction is disregarded in the
apportionment formula.
(i) A participating financial institution's portion of
participation and syndication loans must be attributed under
paragraphs (e) to (h).
(j) Financial institution credit card and travel and
entertainment credit card receivables must be attributed to the
state to which the credit card charges and fees are regularly
billed.
(k) Receivables arising from merchant discount income
derived from financial institution credit card holder
transactions with a merchant are attributed to the state in
which the merchant is located. In the case of merchants located
within and without the state, only receivables from merchant
discounts attributable to sales made from locations within the
state are attributed to this state. It is presumed, subject to
rebuttal, that the location of a merchant is the address shown
on the invoice submitted by the merchant to the taxpayer.
(l) Assets in the nature of securities and money market
instruments are apportioned to this state based upon the ratio
that total deposits from this state, its residents, its
political subdivisions, agencies and instrumentalities bear to
the total deposits from all states, their residents, their
political subdivisions, agencies and instrumentalities. In the
case of an unregulated financial institution, the assets are
apportioned to this state based upon the ratio that its gross
business income earned from sources within this state bears to
gross business income earned from sources within all states.
For purposes of this subsection, deposits made by this state,
its residents, its political subdivisions, agencies, and
instrumentalities are attributed to this state, whether or not
the deposits are accepted or maintained by the taxpayer at
locations within this state.
(m) A financial institution's interest in any property
described in section 290.015, subdivision 3, paragraph (b), is
not included in the numerator or the denominator of the property
factor provided the financial institution's activities within
this state with respect to any interest in such property are
limited in the manner provided in section 290.015, subdivision
3, paragraph (b). If a financial institution is subject to tax
under this chapter, its interest in property described in
section 290.015, subdivision 3, paragraph (b), is included in
the property factor in the same manner as assets in the nature
of securities or money market instruments are included under
paragraph (1).
Sec. 20. Minnesota Statutes 1990, section 290.35,
subdivision 3, is amended to read:
Subd. 3. [CREDIT.] An insurance company shall receive a
credit against the tax computed under sections 290.06,
subdivision 1, and 290.0921, equal to any taxes based on
premiums paid by it that are attributable to the period for
which the tax under this chapter is imposed by virtue of any law
of this state, other than the surcharge on premiums imposed by
sections 69.54 to 69.56.
Sec. 21. Minnesota Statutes 1990, section 290.9727,
subdivision 1, is amended to read:
Subdivision 1. [TAX IMPOSED.] For a corporation electing S
corporation status pursuant to section 1362 of the Internal
Revenue Code of 1986, as amended through December 31, 1989,
after December 31, 1986, and having a recognized built-in gain
as defined in section 1374 of the Internal Revenue Code of 1986,
as amended through December 31, 1989, there is imposed a tax on
the taxable income of such S corporation, as defined in this
section, at the rate prescribed by section 290.06, subdivision
1. This section subdivision does not apply to any corporation
having an S election in effect for each of its taxable years.
An S corporation and any predecessor corporation must be treated
as one corporation for purposes of the preceding sentence.
Sec. 22. Minnesota Statutes 1990, section 290.9727, is
amended by adding a subdivision to read:
Subd. 1a. [ASSET TRANSFERS.] In the case of the transfer
of assets from a C corporation to an S corporation as described
in section 1374(d)(8) of the Internal Revenue Code of 1986, as
amended through December 31, 1990, a tax is imposed on the
taxable income of the S corporation, as defined in this section,
at the rate prescribed in section 290.06, subdivision 1.
Sec. 23. Minnesota Statutes 1990, section 290.9727,
subdivision 3, is amended to read:
Subd. 3. [TAXABLE NET INCOME.] For purposes of this
section, taxable net income means the lesser of:
(1) the recognized built-in gains of the S corporation for
the taxable year, as determined under section 1374 of the
Internal Revenue Code of 1986, as amended through December 31,
1989, subject to the modifications provided in section 290.01,
subdivisions 19e and subdivision 19f, that are allocable to this
state under section 290.17, 290.191, or 290.20; or
(2) the amount of the S corporation's federal taxable
income, as determined under section 1374(d)(4) of the Internal
Revenue Code of 1986, as amended through December 31, 1989,
subject to the provisions of section 290.01, subdivisions 19c to
19f, that is allocable to this state under section 290.17,
290.191, or 290.20, less the deduction for charitable
contributions in section 290.21, subdivision 3.
Sec. 24. Minnesota Statutes 1990, section 290.9727, is
amended by adding a subdivision to read:
Subd. 5. [CREDIT CARRYFORWARD.] Any credit carryforward
allowed under this chapter and arising in a taxable year in
which the corporation was a C corporation is allowed as a credit
against the tax imposed by this section.
Sec. 25. Laws 1990, chapter 604, article 2, section 22, is
amended to read:
Sec. 22. [EFFECTIVE DATE.]
Section 1 is effective for premiums paid after December 31,
1989. The provisions of section 12 are effective for taxable
years beginning after December 31, 1990 for insurance companies
domiciled in a state or country other than Minnesota that
imposes retaliatory taxes, fines, deposits, penalties, licenses,
or fees. Section 14 is effective the day following final
enactment. The remainder of this article is effective for
taxable years beginning after December 31, 1989, except as
otherwise provided.
Sec. 26. [REPEALER.]
Minnesota Statutes 1990, sections 290.068, subdivision 6;
290.069, subdivisions 2a, 4a, and 4b; 290.17, subdivision 7; and
290.191, subdivision 7, are repealed.
Sec. 27. [EFFECTIVE DATE.]
Sections 2, 9, 15 to 19, 21 to 24, and 26 are effective for
taxable years beginning after December 31, 1990, provided that
the carryover for the credit provided under Minnesota Statutes,
section 290.068, subdivision 6, that is repealed by section 26,
remains in effect for taxable years beginning before 2003.
Sections 10 and 14 are effective the day following final
enactment. Sections 1, 3, 20, and 25 are effective for taxable
years beginning after December 31, 1989.
ARTICLE 8
SALES AND USE TAX
Section 1. Minnesota Statutes 1990, section 84.82, is
amended by adding a subdivision to read:
Subd. 10. [PROOF OF SALES TAX PAYMENT.] A person applying
for initial registration of a snowmobile must provide a
snowmobile purchaser's certificate, showing a complete
description of the snowmobile, the seller's name and address,
the full purchase price of the snowmobile, and the trade-in
allowance, if any. The certificate must include information
showing either (1) that the sales and use tax under chapter 297A
was paid or (2) the purchase was exempt from tax under chapter
297A. The commissioner of public safety, in consultation with
the commissioner and the commissioner of revenue, shall
prescribe the form of the certificate.
Sec. 2. Minnesota Statutes 1990, section 86B.401, is
amended by adding a subdivision to read:
Subd. 12. [PROOF OF SALES TAX PAYMENT.] A person applying
for initial licensing of a watercraft must provide a watercraft
purchaser's certificate, showing a complete description of the
watercraft, the seller's name and address, the full purchase
price of the watercraft, and the trade-in allowance, if any.
The certificate must include information showing either (1) that
the sales and use tax under chapter 297A was paid or (2) the
purchase was exempt from tax under chapter 297A. The
commissioner of public safety, in consultation with the
commissioner and the commissioner of revenue, shall prescribe
the form of the certificate.
Sec. 3. Minnesota Statutes 1990, section 289A.11,
subdivision 1, is amended to read:
Subdivision 1. [RETURN REQUIRED.] Except as provided in
section 289A.18, subdivision 4, for the month in which taxes
imposed by sections 297A.01 to 297A.44 are payable, or for which
a return is due, a return for the preceding reporting period
must be filed with the commissioner in the form the commissioner
prescribes. The return must be verified by a written
declaration that it is made under the criminal penalties for
making a false return, and in addition must contain a confession
of judgment for the amount of the tax shown due to the extent
not timely paid. A person making sales at retail at two or more
places of business may file a consolidated return subject to
rules prescribed by the commissioner.
Notwithstanding this subdivision, a person who is not
required to hold a sales tax permit under chapter 297A and who
makes annual purchases of less than $5,000 that are subject to
the use tax imposed by section 297A.14, may file an annual use
tax return on a form prescribed by the commissioner. If a
person who qualifies for an annual use tax reporting period is
required to obtain a sales tax permit or makes use tax purchases
in excess of $5,000 during the calendar year, the reporting
period must be considered ended at the end of the month in which
the permit is applied for or the purchase in excess of $5,000 is
made and a return must be filed for the preceding reporting
period.
Sec. 4. Minnesota Statutes 1990, section 289A.18,
subdivision 4, is amended to read:
Subd. 4. [SALES AND USE TAX RETURNS.] Sales and use tax
returns must be filed on or before the 20th day of the month
following the close of the preceding reporting period, except
that annual use tax returns provided for under section 289A.11,
subdivision 1, must be filed by April 15 following the close of
the calendar year. In addition, on or before June 20 of a year,
a retailer who has a May liability of $1,500 or more must file a
return with the commissioner for one-half of the estimated June
liability, in addition to filing a return for the May
liability. On or before August 20 of a year, the retailer must
file a return showing the actual June liability.
Sec. 5. Minnesota Statutes 1990, section 289A.20,
subdivision 4, is amended to read:
Subd. 4. [SALES AND USE TAX.] (a) The taxes imposed by
chapter 297A are due and payable to the commissioner monthly on
or before the 20th day of the month following the month in which
the taxable event occurred or following another reporting period
as the commissioner prescribes, except that use taxes due on an
annual use tax return as provided under section 289A.11,
subdivision 1, are payable by April 15 following the close of
the calendar year.
(b) A vendor having a liability of $1,500 or more in May of
a year must remit the June liability in the following manner:
(1) On or before June 20 of the year, the vendor must remit
the actual May liability and one-half of the estimated June
liability to the commissioner.
(2) On or before August 20 of the year, the vendor must pay
any additional amount of tax not remitted in June.
(c) When a retailer located outside of a city that imposes
a local sales and use tax collects use tax to be remitted to
that city, the retailer is not required to remit the tax until
the amount collected reaches $10.
Sec. 6. Minnesota Statutes 1990, section 289A.60,
subdivision 15, is amended to read:
Subd. 15. [ACCELERATED PAYMENT OF JUNE SALES TAX
LIABILITY; PENALTY FOR UNDERPAYMENT.] If a vendor is required by
law to submit an estimation of June sales tax liabilities and
one-half payment by a certain date, and the vendor fails to
remit the balance due by the date required, the vendor shall pay
a penalty equal to ten percent of the amount of actual June
liability required to be paid in June less the amount remitted
in June. The penalty must not be imposed, however, if the
amount remitted in June equals the lesser of: (1) 45 percent of
the actual June liability, or (2) 50 percent of the preceding
May's liability, or (3) 50 percent of the average monthly
liability for the previous calendar year.
Sec. 7. Minnesota Statutes 1990, section 297A.01,
subdivision 3, is amended to read:
Subd. 3. A "sale" and a "purchase" includes, but is not
limited to, each of the following transactions:
(a) Any transfer of title or possession, or both, of
tangible personal property, whether absolutely or conditionally,
and the leasing of or the granting of a license to use or
consume tangible personal property other than manufactured homes
used for residential purposes for a continuous period of 30 days
or more, for a consideration in money or by exchange or barter;
(b) The production, fabrication, printing, or processing of
tangible personal property for a consideration for consumers who
furnish either directly or indirectly the materials used in the
production, fabrication, printing, or processing;
(c) The furnishing, preparing, or serving for a
consideration of food, meals, or drinks. "Sale" does not
include:
(1) meals or drinks served to patients, inmates, or persons
residing at hospitals, sanitariums, nursing homes, senior
citizens homes, and correctional, detention, and detoxification
facilities;
(2) meals or drinks purchased for and served exclusively to
individuals who are 60 years of age or over and their spouses or
to the handicapped and their spouses by governmental agencies,
nonprofit organizations, agencies, or churches or pursuant to
any program funded in whole or part through 42 USCA sections
3001 through 3045, wherever delivered, prepared or served; or
(3) meals and lunches served at public and private schools,
universities, or colleges. Notwithstanding section 297A.25,
subdivision 2, taxable food or meals include, but are not
limited to, the following:
(i) heated food or drinks;
(ii) sandwiches prepared by the retailer;
(iii) single sales of prepackaged ice cream or ice milk
novelties prepared by the retailer;
(iv) hand-prepared or dispensed ice cream or ice milk
products including cones, sundaes, and snow cones;
(v) soft drinks and other beverages prepared or served by
the retailer;
(vi) gum;
(vii) ice;
(viii) all food sold in vending machines;
(ix) party trays prepared by the retailers; and
(x) all meals and single servings of packaged snack food,
single cans or bottles of pop, sold in restaurants and bars;
(d) The granting of the privilege of admission to places of
amusement, recreational areas, or athletic events, except a
world championship football game sponsored by the national
football league, and the privilege of having access to and the
use of amusement devices, tanning facilities, reducing salons,
steam baths, turkish baths, massage parlors, health clubs, and
spas or athletic facilities;
(e) The furnishing for a consideration of lodging and
related services by a hotel, rooming house, tourist court, motel
or trailer camp and of the granting of any similar license to
use real property other than the renting or leasing thereof for
a continuous period of 30 days or more;
(f) The furnishing for a consideration of electricity, gas,
water, or steam for use or consumption within this state, or
local exchange telephone service, intrastate toll service, and
interstate toll service, if that service originates from and is
charged to a telephone located in this state; the tax imposed on
amounts paid for telephone services is the liability of and
shall be paid by the person paying for the services. Telephone
service includes paging services and private communication
service, as defined in United States Code, title 26, section
4252(d), except for private communication service purchased by
an agent acting on behalf of the state lottery. The furnishing
for a consideration of access to telephone services by a hotel
to its guests is a sale under this clause. Sales by municipal
corporations in a proprietary capacity are included in the
provisions of this clause. The furnishing of water and sewer
services for residential use shall not be considered a sale.
The sale of natural gas to be used as a fuel in vehicles
propelled by natural gas shall not be considered a sale for the
purposes of this section;
(g) The furnishing for a consideration of cable television
services, including charges for basic monthly service, charges
for monthly premium service, and charges for any other similar
television services;
(h) Notwithstanding subdivision 4, and section 297A.25,
subdivision 9, the sales of horses including claiming sales and
fees paid for breeding a stallion to a mare. This clause
applies to sales and fees with respect to a horse to be used for
racing whose birth has been recorded by the Jockey Club or the
United States Trotting Association or the American Quarter Horse
Association;
(i) The furnishing for a consideration of parking services,
whether on a contractual, hourly, or other periodic basis,
except for parking at a meter;
(j) The furnishing for a consideration of services listed
in this paragraph:
(i) laundry and dry cleaning services including cleaning,
pressing, repairing, altering, and storing clothes, linen
services and supply, cleaning and blocking hats, and carpet,
drapery, upholstery, and industrial cleaning. Laundry and dry
cleaning services do not include services provided by coin
operated facilities operated by the customer;
(ii) motor vehicle washing, waxing, and cleaning services,
including services provided by coin-operated facilities operated
by the customer, and rustproofing, undercoating, and towing of
motor vehicles;
(iii) building and residential cleaning, maintenance, and
disinfecting and exterminating services;
(iv) services provided by detective agencies, security
services, burglar, fire alarm, and armored car services not
including services performed within the jurisdiction they serve
by off-duty licensed peace officers as defined in section
626.84, subdivision 1;
(v) pet grooming services;
(vi) lawn care, fertilizing, mowing, spraying and sprigging
services; garden planting and maintenance; arborist services;
tree, bush, and shrub planting, pruning, bracing, spraying, and
surgery; and tree trimming for public utility lines. Services
performed under a construction contract for the installation of
shrubbery, plants, sod, trees, bushes, and similar items are not
taxable;
(vii) solid waste collection and disposal services as
described in section 297A.45;
(viii) massages, except when provided by a licensed health
care facility or professional or upon written referral from a
licensed health care facility or professional for treatment of
illness, injury, or disease; and
(ix) the furnishing for consideration of lodging, board and
care services for animals in kennels and other similar
arrangements, but excluding veterinary and horse boarding
services.
The services listed in this paragraph are taxable under section
297A.02 if the service is performed wholly within Minnesota or
if the service is performed partly within and partly without
Minnesota and the greater proportion of the service is performed
in Minnesota, based on the cost of performance. In applying the
provisions of this chapter, the terms "tangible personal
property" and "sales at retail" include taxable services and the
provision of taxable services, unless specifically provided
otherwise. Services performed by an employee for an employer
are not taxable under this paragraph. Services performed by a
partnership or association for another partnership or
association are not taxable under this paragraph if one of the
entities owns or controls more than 80 percent of the voting
power of the equity interest in the other entity. Services
performed between members of an affiliated group of corporations
are not taxable. For purposes of this section, "affiliated
group of corporations" includes those entities that would be
classified as a member of an affiliated group under United
States Code, title 26, section 1504, and who are eligible to
file a consolidated tax return for federal income tax purposes;
and
(vii) solid waste collection and disposal services as
described in section 297A.45;
(k) A "sale" and a "purchase" includes the transfer of
computer software, meaning information and directions that
dictate the function performed by data processing equipment. A
"sale" and a "purchase" does not include the design,
development, writing, translation, fabrication, lease, or
transfer for a consideration of title or possession of a custom
computer program; and
(l) The granting of membership in a club, association, or
other organization if:
(1) the club, association, or other organization makes
available for the use of its members sports and athletic
facilities (without regard to whether a separate charge is
assessed for use of the facilities); and
(2) use of the sports and athletic facilities is not made
available to the general public on the same basis as it is made
available to members.
Granting of membership includes both one-time initiation fees
and periodic membership dues. Sports and athletic facilities
include golf courses, tennis, racquetball, handball and squash
courts, basketball and volleyball facilities, running tracks,
exercise equipment, swimming pools, and other similar athletic
or sports facilities. The provisions of this paragraph do not
apply to camps or other recreation facilities owned and operated
by an exempt organization under section 501(c)(3) of the
Internal Revenue Code of 1986, as amended through December 31,
1986, for educational and social activities for young people
primarily age 18 and under.
Sec. 8. Minnesota Statutes 1990, section 297A.01,
subdivision 4, is amended to read:
Subd. 4. A "retail sale" or "sale at retail" means a sale
for any purpose other than resale in the regular course of
business. Property utilized by the owner only by leasing such
property to others or by holding it in an effort to so lease it,
and which is put to no use by the owner other than resale after
such lease or effort to lease, shall be considered property
purchased for resale. Master computer software programs that
are purchased and used to make copies for sale or lease are
considered property purchased for resale. Sales of building
materials, supplies and equipment to owners, contractors,
subcontractors or builders for the erection of buildings or the
alteration, repair or improvement of real property are "retail
sales" or "sales at retail" in whatever quantity sold and
whether or not for purpose of resale in the form of real
property or otherwise. A sale of carpeting, linoleum, or other
similar floor covering which includes installation of the
carpeting, linoleum, or other similar floor covering is a
contract for the improvement of real property. A sale of
shrubbery, plants, sod, trees, and similar items that includes
installation of the shrubbery, plants, sod, trees, and similar
items is a contract for the improvement of real property.
Aircraft and parts for the repair thereof purchased by a
nonprofit, incorporated flying club or association utilized
solely by the corporation by leasing such aircraft to
shareholders of the corporation shall be considered property
purchased for resale. The leasing of the aircraft to the
shareholders by the flying club or association shall be
considered a sale.
Leasing of aircraft utilized by a lessee for the purpose of
leasing to others, whether or not the lessee also utilizes the
aircraft for flight instruction where no separate charge is made
for aircraft rental or for charter service, shall be considered
a purchase for resale; provided, however, that a proportionate
share of the lease payment reflecting use for flight instruction
or charter service is subject to tax pursuant to section 297A.14.
Sec. 9. Minnesota Statutes 1990, section 297A.01,
subdivision 8, is amended to read:
Subd. 8. "Sales price" means the total consideration
valued in money, for a retail sale whether paid in money or
otherwise, excluding therefrom any amount allowed as credit for
tangible personal property taken in trade for resale, without
deduction for the cost of the property sold, cost of materials
used, labor or service cost, interest, or discount allowed after
the sale is consummated, the cost of transportation incurred
prior to the time of sale, any amount for which credit is given
to the purchaser by the seller, or any other expense
whatsoever. A deduction may be made for charges for services
that are part of the sale, including charges up to 15 percent in
lieu of tips, if the consideration for such charges is
separately stated, but. No deduction shall be allowed for
charges for services that are part of a sale as defined in
subdivision 3, clauses (b) to (l). A deduction may also be made
for interest, financing, or carrying charges, charges for labor
or services used in installing or applying the property sold or
transportation charges if the transportation occurs after the
retail sale of the property only if the consideration for such
charges is separately stated. There shall not be included in
"sales price" cash discounts allowed and taken on sales or the
amount refunded either in cash or in credit for property
returned by purchasers.
Sec. 10. Minnesota Statutes 1990, section 297A.01, is
amended by adding a subdivision to read:
Subd. 19. [AQUACULTURE PRODUCTION EQUIPMENT.] "Aquaculture
production equipment" means new or used machinery, equipment,
implements, accessories, and contrivances used directly and
principally in aquaculture production. Aquaculture production
equipment includes: augers and blowers, automatic feed systems,
manual feeding equipment, shockers, gill nets, trap nets,
seines, box traps, round nets and traps, net pens, dip nets, net
washers, floating net supports, floating access walkways, net
supports and walkways, growing tanks, holding tanks, troughs,
raceways, transport tanks, egg taking equipment, egg hatcheries,
egg incubators, egg baskets and troughs, egg graders, egg
counting equipment, fish counting equipment, fish graders, fish
pumps and loaders, fish elevators, air blowers, air compressors,
oxygen generators, oxygen regulators, diffusers and injectors,
air supply equipment, oxygenation columns, water coolers and
heaters, heat exchangers, water filter systems, water
purification systems, waste collection equipment, feed mills,
portable scales, feed grinders, feed mixers, feed carts and
trucks, power feed wagons, fertilizer spreaders, fertilizer
tanks, forage collection equipment, land levelers, loaders, post
hole diggers, disc, harrow, plow, and water diversion devices.
Repair or replacement parts for aquaculture production equipment
shall not be included in the definition of aquaculture
production equipment.
Sec. 11. Minnesota Statutes 1990, section 297A.02,
subdivision 2, is amended to read:
Subd. 2. [MACHINERY AND EQUIPMENT.] Notwithstanding the
provisions of subdivision 1, the rate of the excise tax imposed
upon sales of special tooling is four percent and upon sales of
farm machinery and aquaculture production equipment is two
percent.
Sec. 12. [297A.135] [RENTAL MOTOR VEHICLE TAX.]
Subdivision 1. [TAX IMPOSED.] A tax of $7.50 is imposed on
the lease or rental in this state on a daily or weekly basis of
a passenger automobile as defined in section 168.011,
subdivision 7, a van as defined in section 168.011, subdivision
28, or a pickup truck as defined in section 168.011, subdivision
29. The tax does not apply to the lease or rental of a hearse
or limousine used in connection with a burial or funeral
service. The tax does not apply if the term of the lease or
rental is longer than 28 days. It applies whether or not the
vehicle is licensed in the state.
Subd. 2. [SALES AND USE TAX.] The tax imposed in
subdivision 1 is not included in the sales price for purposes of
determining the sales and use tax imposed in this chapter or any
sales and use tax imposed on the transaction under a special law.
Subd. 3. [ADMINISTRATION.] The tax imposed in subdivision
1 must be reported and paid to the commissioner of revenue with
the taxes imposed in this chapter. It is subject to the same
interest, penalty, and other provisions provided for sales and
use taxes under chapter 289A and this chapter. The commissioner
has the same powers to assess and collect the tax that are given
the commissioner in chapters 270 and 289A and this chapter to
assess and collect sales and use tax.
Sec. 13. Minnesota Statutes 1990, section 297A.21,
subdivision 1, is amended to read:
Subdivision 1. [RETAILER MAINTAINING PLACE OF BUSINESS IN
MINNESOTA.] "Retailer maintaining a place of business in this
state", or any like term, shall mean any retailer having or
maintaining within this state, directly or by a subsidiary, an
office, place of distribution house, sales house or sample room
or place, warehouse, or other place of business, or any agent
operating within having any representative, agent, salesperson,
canvasser, or solicitor operating in this state under the
authority of the retailer or its subsidiary, whether such place
of business or agent is located in the state permanently or
temporarily, or whether or not such retailer or subsidiary is
authorized to do business within this state for any purpose,
including the repairing, selling, delivering, installing, or
soliciting of orders for the retailer's goods or services, or
the leasing of tangible personal property located in this state,
whether the place of business or agent, representative,
salesperson, canvasser, or solicitor is located in the state
permanently or temporarily, or whether or not the retailer or
subsidiary is authorized to do business within this state.
Sec. 14. Minnesota Statutes 1990, section 297A.21,
subdivision 4, is amended to read:
Subd. 4. [REQUIRED REGISTRATION BY OUT-OF-STATE RETAILER
NOT MAINTAINING PLACE OF BUSINESS IN MINNESOTA.] (a) A retailer
making retail sales from outside this state to a destination
within this state and not maintaining a place of business in
this state shall file an application for a permit pursuant to
section 297A.04 and shall collect and remit the use tax as
provided in section 297A.16 if the retailer engages in the
regular or systematic soliciting of sales from potential
customers in this state by:
(1) the distribution, by mail or otherwise, without regard
to the state from which such distribution originated or in which
the materials were prepared, of catalogs, periodicals,
advertising flyers, or other written solicitations of business
to customers in this state;
(2) display of advertisements on billboards or other
outdoor advertising in this state;
(3) advertisements in newspapers published in this state;
(4) advertisements in trade journals or other periodicals
the circulation of which is primarily within this state;
(5) advertisements in a Minnesota edition of a national or
regional publication or a limited regional edition in which this
state is included of a broader regional or national publication
which are not placed in other geographically defined editions of
the same issue of the same publication;
(6) advertisements in regional or national publications in
an edition which is not by its contents geographically targeted
to Minnesota but which is sold over the counter in Minnesota or
by subscription to Minnesota residents;
(7) advertisements broadcast on a radio or television
station located in Minnesota; or
(8) any other solicitation by telegraphy, telephone,
computer data base, cable, optic, microwave, or other
communication system.
(b) The location within or without this state of vendors
independent of the retailer which provide products or services
to the retailer in connection with its solicitation of customers
within this state, including such products and services as
creation of copy, printing, distribution, and recording, is not
to be taken into account in the determination of whether the
retailer is required to collect use tax. Paragraph (a) shall be
construed without regard to the state from which distribution of
the materials originated or in which they were prepared.
(c) A retailer not maintaining a place of business in this
state shall be presumed, subject to rebuttal, to be engaged in
regular solicitation within this state if it (1) engages in any
of the activities in paragraph (a) and (1) makes 100 or more
retail sales from outside this state to destinations within this
state during a period of 12 consecutive months, or (2) makes ten
or more retail sales totaling more than $100,000 from outside
this state to destinations within this state during a period of
12 consecutive months.
(d) A retailer not maintaining a place of business in this
state shall not be required to collect use tax imposed by any
local governmental unit or subdivision of this state and this
section does not subject such a retailer to any regulation of
any local unit of government or subdivision of this state.
Sec. 15. Minnesota Statutes 1990, section 297A.211,
subdivision 2, is amended to read:
Subd. 2. (a) Such persons, when properly registered as
retailers, may make purchases in this state, or import property
into this state, without payment of the sales or use taxes
imposed by this chapter at the time of purchase or importation,
provided that such purchases or importations come within the
provisions of this section and are made in strict compliance
with the rules of the commissioner.
(b) Any person described in subdivision 1 may elect to pay
directly to the commissioner any sales or use tax that may be
due under this chapter for the acquisition of mobile
transportation equipment and parts and accessories attached or
to be attached to such equipment registered under section
168.187.
(c) The total cost of such equipment and parts and
accessories attached or to be attached to such equipment shall
be multiplied by a fraction, the numerator of which is the
Minnesota mileage operated during the past calendar year within
the state of Minnesota as reported on the current pro rata
application provided for in section 168.187 and the denominator
is the total mileage operated during the past calendar
year reported on the current pro rata registration application.
The amount so determined shall be multiplied by the tax rate to
disclose the tax due.
In computing the tax under this section "sales price" does not
include the amount of any tax, except any manufacturer's or
importer's excise tax, imposed by the United States upon or with
respect to retail sales, whether imposed on the retailer or the
consumer.
(d) Each such retailer shall make a return and remit to the
commissioner the tax due for the preceding calendar month in
accordance with the provisions of sections 289A.11 and 289A.20,
subdivision 4.
Sec. 16. Minnesota Statutes 1990, section 297A.25,
subdivision 1, is amended to read:
Subdivision 1. [SCOPE.] The items contained in
subdivisions 2 to 30 this section are specifically exempted from
the taxes imposed by sections 297A.01 to 297A.44.
Sec. 17. Minnesota Statutes 1990, section 297A.25,
subdivision 9, is amended to read:
Subd. 9. [MATERIALS CONSUMED IN PRODUCTION.] The gross
receipts from the sale of and the storage, use, or consumption
of all materials, including chemicals, fuels, petroleum
products, lubricants, packaging materials, including returnable
containers used in packaging food and beverage products, feeds,
seeds, fertilizers, electricity, gas and steam, used or consumed
in agricultural or industrial production of personal property
intended to be sold ultimately at retail, whether or not the
item so used becomes an ingredient or constituent part of the
property produced are exempt. Seeds, trees, fertilizers, and
herbicides purchased for use by farmers in the Conservation
Reserve Program under United States Code, title 16, section
590h, the Integrated Farm Management Program under section 1627
of Public Law Number 101-624, the Wheat and Feed Grain Programs
under sections 301 to 305 and 401 to 405 of Public Law Number
101-624, and the conservation reserve program under sections
103F.505 to 103F.531, are included in this exemption. Chemicals
used for cleaning food processing machinery and equipment are
included in this exemption. Such production shall include, but
is not limited to, research, development, design or production
of any tangible personal property, manufacturing, processing
(other than by restaurants and consumers) of agricultural
products whether vegetable or animal, commercial fishing,
refining, smelting, reducing, brewing, distilling, printing,
mining, quarrying, lumbering, generating electricity and the
production of road building materials. Such production shall
not include painting, cleaning, repairing or similar processing
of property except as part of the original manufacturing
process. Machinery, equipment, implements, tools, accessories,
appliances, contrivances, furniture and fixtures, used in such
production and fuel, electricity, gas or steam used for space
heating or lighting, are not included within this exemption;
however, accessory tools, equipment and other short lived items,
which are separate detachable units used in producing a direct
effect upon the product, where such items have an ordinary
useful life of less than 12 months, are included within the
exemption provided herein. Electricity used to make snow for
outdoor use for ski hills, ski slopes, or ski trails is included
in this exemption.
Sec. 18. Minnesota Statutes 1990, section 297A.25,
subdivision 10, is amended to read:
Subd. 10. [PUBLICATIONS; PUBLICATION MATERIALS.] The gross
receipts from the sale of and storage, use or other consumption
in Minnesota of tangible personal property (except as provided
in section 297A.14) which is used or consumed in producing any
publication regularly issued at average intervals not exceeding
three months, and any such publication are exempt. For purposes
of this subdivision, "publication" as used herein shall include,
without limiting the foregoing, a legal qualified newspaper as
defined by section 331.02 331A.02, and any supplements or
enclosures with or part of said newspaper; and the gross
receipts of any advertising contained therein or therewith shall
be exempt. For this purpose, advertising in any such
publication shall be deemed to be a service and not tangible
personal property, and persons or their agents who publish or
sell such newspapers shall be deemed to be engaging in a service
with respect to gross receipts realized from such newsgathering
or publishing activities by them, including the sale of
advertising. The term "publication" shall not include magazines
and periodicals sold over the counter. Machinery, equipment,
implements, tools, accessories, appliances, contrivances,
furniture and fixtures used in such publication and fuel,
electricity, gas or steam used for space heating or lighting,
are not exempt.
Sec. 19. Minnesota Statutes 1990, section 297A.25,
subdivision 12, is amended to read:
Subd. 12. [OCCASIONAL SALES.] (a) The gross receipts from
the isolated or occasional sale of tangible personal property in
Minnesota not made in the normal course of business of selling
that kind of property, and the storage, use, or consumption of
property acquired as a result of such a sale are exempt.
(b) This exemption does not apply to sales of tangible
personal property primarily used in a trade or business unless
(1) the sale occurs in a transaction subject to or described in
section 118, 331, 332, 336, 337, 338, 351, 355, 368, 721, 731,
1031, or 1033 of the Internal Revenue Code of 1986, as amended
through December 31, 1990, or (2) the sale is between members of
an affiliated group as defined in section 1504(a) of the
Internal Revenue Code of 1986, as amended through December 31,
1990.
Sec. 20. Minnesota Statutes 1990, section 297A.25, is
amended by adding a subdivision to read:
Subd. 46. [SACRAMENTAL WINE.] The gross receipts from the
sale of wine for sacramental purposes in religious ceremonies,
as described in section 340A.316, if the wine is purchased from
a nonprofit religious organization meeting the requirements of
subdivision 16 or from the holder of a sacramental wine license
as provided in section 340A.316 are exempt.
Sec. 21. Minnesota Statutes 1990, section 297A.255,
subdivision 5, is amended to read:
Subd. 5. There is specifically exempted from the
provisions of this chapter the purchase or use of
aircraft previously registered in the state of Minnesota by a
corporation or partnership when the transfer constitutes a
transfer within the meaning of section 351 or 721 of the
Internal Revenue Code of 1986, as amended through December 31,
1989.
Sec. 22. Laws 1980, chapter 511, section 1, subdivision 2,
is amended to read:
Subd. 2. Notwithstanding Minnesota Statutes, Section
477A.01, Subdivision 18, or any other law, ordinance, or city
charter provision to the contrary, the city of Duluth may, by
ordinance, impose an additional sales tax of up to one percent
on sales transactions which are described in Minnesota Statutes,
Section 297A.01, Subdivision 3, Clause (c). The imposition of
this tax shall not be subject to voter referendum under either
state law or city charter provisions. The tax imposed pursuant
to this subdivision shall terminate no later than December 31,
1992.
Sec. 23. Laws 1983, chapter 342, article 19, section 1, is
amended to read:
Section 1. [SALES AND USE TAX.]
Notwithstanding Minnesota Statutes, section 477A.016, or
any other contrary provision of law, ordinance, or city charter,
the city of Rochester may, by ordinance, impose an additional
sales tax of up to one percent on sales transactions taxable
pursuant to Minnesota Statutes, chapter 297A, that occur within
the city, and may also, by ordinance, impose an additional
compensating use tax of up to one percent on uses of property
within the city, the sale of which would be subject to the
additional sales tax but for the fact the property was sold
outside the city.
Sec. 24. Laws 1986, chapter 462, section 31, is amended to
read:
Sec. 31. [AUTHORITY FOR TAXATION.]
Notwithstanding Minnesota Statutes, section 477A.016, or
any other law, and supplemental to the tax imposed by Laws 1982,
chapter 523, article 25, section 1, the city of St. Paul may
impose, by ordinance, a tax, at a rate not greater than two
three percent, on the gross receipts from the furnishing for
consideration of lodging at a hotel, rooming house, tourist
court, motel, or resort, other than the renting or leasing of
space for a continuous period of 30 days or more. The tax does
not apply to the furnishing of lodging by a business having less
than 50 lodging rooms. The tax shall be collected by and its
proceeds paid to the city. Ninety-five percent of the revenues
generated by this tax shall be used to fund a convention bureau
to market and promote the city as a tourist or convention center.
Sec. 25. Laws 1990, chapter 604, article 6, section 9,
subdivision 1, is amended to read:
Subdivision 1. [AUTHORIZATION.] Notwithstanding Minnesota
Statutes, section 469.190, 477A.016, or other law, in addition
to the tax authorized in Laws 1986, chapter 391, section 4, the
governing body of the city of Bloomington may impose a tax of up
to one percent on the gross receipts from the furnishing for
consideration of lodging at a hotel, motel, rooming house,
tourist court, or resort, other than the renting or leasing of
it for a continuous period of 30 days or more, located in the
city. The city may agree with the commissioner of revenue that
a tax imposed under this section shall be collected by the
commissioner together with the tax imposed by Minnesota
Statutes, chapter 297A, and subject to the same interest,
penalties, and other rules and that its proceeds, less the cost
of collection, shall be remitted to the city. The proceeds of
the tax must be used to promote the metropolitan sports area
defined in Minnesota Statutes, section 473.551, subdivision 5 by
the Bloomington convention bureau only to market and promote the
city as a tourist or convention center. If the duties of the
convention bureau as they existed on January 1, 1991, are
assigned to another agency, the tax shall cease.
Subd. 1a. [LOCAL APPROVAL.] Subdivision 1 takes effect the
day after the governing body of the city of Bloomington complies
with Minnesota Statutes, section 645.021, subdivision 3.
Sec. 26. Laws 1990, chapter 604, article 6, section 11, is
amended to read:
Sec. 11. [EFFECTIVE DATE.]
Sections 1 to 3 are effective for sales after June 30, 1990.
Section 4 is effective for sales after December 31,
1983 1982. The provisions of Minnesota Statutes, section
297A.35, apply to refunds claimed under section 4.
Section 5 is effective for transactions occurring on or
after December 1, 1989.
Sections 6 to 8 are effective February 1, 1990. Any tax
increase adopted by action of a city council after February 1,
1990, under Minnesota Statutes, section 469.190, that results in
a tax rate that exceeds three percent is ineffective the day
following final enactment of this act.
Section 9 is effective the day following final enactment.
Section 10 is effective the day following final enactment,
but only if the legislature authorizes the issuance of bonds for
the construction of the facility during its 1990 session.
Sec. 27. [CITY OF MANKATO; SALES TAX.]
Subdivision 1. [SALES TAX AUTHORIZED.] Notwithstanding
Minnesota Statutes, section 477A.016, or any other contrary
provision of law, ordinance, or city charter, the city of
Mankato may, by ordinance, impose an additional sales tax of up
to one-half of one percent on sales transactions taxable
pursuant to Minnesota Statutes, chapter 297A, that occur within
the city.
Subd. 2. [EXCISE TAX.] Notwithstanding Minnesota Statutes,
section 477A.016, or any other contrary provision of law,
ordinance, or city charter, the city of Mankato may, by
ordinance, impose an excise tax of up to $20 per motor vehicle,
as defined by ordinance, purchased or acquired from any person
engaged within the city in the business of selling motor
vehicles at retail.
Subd. 3. [USE OF REVENUES.] Revenues received from taxes
authorized by subdivisions 1 and 2 shall be used by the city to
pay the cost of collecting the tax and to pay all or a portion
of the expenses of constructing and operating facilities as part
of an urban revitalization project in downtown Mankato known as
Riverfront 2000. Authorized expenses include, but are not
limited to, acquiring property and paying relocation expenses
related to the development of Riverfront 2000 and related
facilities, and securing or paying debt service on bonds or
other obligations issued to finance the construction of
Riverfront 2000 and related facilities. For purposes of this
section, "Riverfront 2000 and related facilities" means a
civic-convention center, an arena, a riverfront park, and all
publicly owned real or personal property that the governing body
of the city determines will be necessary to facilitate the use
of these facilities, including but not limited to parking,
skyways, pedestrian bridges, lighting, and landscaping.
Subd. 4. [EXPIRATION OF TAXING AUTHORITY AND EXPENDITURE
LIMITATION.] The authority granted by subdivisions 1 and 2 to
the city to impose a sales tax and an excise tax shall expire
when the principal and interest on any bonds or obligations
issued to finance construction of Riverfront 2000 and related
facilities have been paid or at an earlier time as the city
shall, by ordinance, determine. The total capital,
administrative, and operating expenditures payable from bond
proceeds and revenues received from the taxes authorized by
subdivisions 1 and 2, excluding investment earnings on bond
proceeds and revenues, shall not exceed $25,000,000 for
Riverfront 2000 and related facilities.
Subd. 5. [BONDS.] The city of Mankato may issue general
obligation bonds of the city in an amount not to exceed
$25,000,000 for Riverfront 2000 and related facilities, without
election under Minnesota Statutes, chapter 475, on the question
of issuance of the bonds or a tax to pay them. The debt
represented by bonds issued for Riverfront 2000 and related
facilities shall not be included in computing any debt
limitations applicable to the city of Mankato, and the levy of
taxes required by section 475.61 to pay principal of and
interest on the bonds shall not be subject to any levy
limitation or be included in computing or applying any levy
limitation applicable to the city.
Subd. 6. [REVERSE REFERENDUM.] If the Mankato city council
intends to exercise the authority provided by this section, it
shall pass a resolution stating the fact before July 1, 1991.
The resolution must be published for two successive weeks in the
official newspaper of the city or, if there is no official
newspaper, in a newspaper of general circulation in the city,
together with a notice fixing a date for a public hearing on the
matter. The hearing must be held at least two weeks but not
more than four weeks after the first publication of the
resolution. Following the public hearing, the city may
determine to take no further action or adopt a resolution
confirming its intention to exercise the authority. That
resolution must also be published in the official newspaper of
the city or, if there is no official newspaper, in a newspaper
of general circulation in the city. If within 30 days after
publication of the resolution a petition signed by voters equal
in number to ten percent of the votes cast in the city in the
last general election requesting a vote on the proposed
resolution is filed with the county auditor, the resolution is
not effective until it has been submitted to the voters at a
general or special election and a majority of votes cast on the
question of approving the resolution are in the affirmative.
The commissioner of revenue shall prepare a suggested form of
question to be presented at the election. The referendum must
be held at a special or general election before December 1, 1991.
This subdivision applies notwithstanding any city charter
provision to the contrary.
Subd. 7. [ENFORCEMENT; COLLECTION; AND ADMINISTRATION OF
TAXES.] A sales tax imposed under this section shall be reported
and paid to the commissioner of revenue with the state sales
taxes, and be subject to the same penalties, interest, and
enforcement provisions. The proceeds of the tax, less refunds
and a proportionate share of the cost of collection, shall be
remitted at least quarterly to the city. The commissioner shall
deduct from the proceeds remitted an amount that equals the
indirect statewide cost as well as the direct and indirect
department costs necessary to administer, audit, and collect the
tax. The amount deducted shall be deposited in the state
general fund.
Subd. 8. [LOCAL APPROVAL; EFFECTIVE DATE.] This section is
effective the day after compliance with Minnesota Statutes,
section 645.021, subdivision 3, by the governing body of the
city of Mankato, provided that the tax must be imposed and its
rate fixed before December 31, 1992.
Sec. 28. [WINONA LODGING TAX.]
Subdivision 1. [AUTHORIZATION.] Notwithstanding Minnesota
Statutes, section 469.190, 477A.016, or other law, in addition
to the tax authorized in Minnesota Statutes, section 469.190,
the city of Winona may, by ordinance, impose a tax of up to one
percent on the gross receipts from the furnishing for
consideration of lodging at a hotel, motel, rooming house,
tourist court, or resort, other than the renting or leasing of
it for a continuous period of 30 days or more. The city may, by
ordinance, impose the tax authorized under this section on the
camping site receipts of a municipal campground.
Fifty percent of the proceeds of this tax shall be used to
retire the indebtedness of the Julius C. Wilke Steamboat Center
and the balance shall be used in the manner directed in
Minnesota Statutes, section 469.190, subdivision 3. Upon
retirement of the debt, the council shall by ordinance reduce
the tax by one-half percent or dedicate the entire one percent
in the manner directed in Minnesota Statutes, section 469.190,
subdivision 3.
The tax shall be collected in the same manner as other
taxes authorized under Minnesota Statutes, section 469.190.
Subd. 2. [LOCAL APPROVAL.] Subdivision 1 takes effect the
day after the governing body of the city of Winona complies with
Minnesota Statutes, section 645.021, subdivision 3.
Sec. 29. [REFUNDS.]
No refunds may be paid under section 17 or 20 unless the
claimant can demonstrate to the commissioner of revenue that the
refunds will be paid to those who paid the tax.
Sec. 30. [REPEALER.]
Minnesota Statutes 1990, section 297A.257; and Laws 1986,
chapter 399, article 1, section 5, are repealed.
Sec. 31. [EFFECTIVE DATE.]
Section 1 is effective for snowmobiles registered after
September 1, 1991. Section 2 is effective for watercraft
registered after September 1, 1991. Sections 3 to 5 are
effective for purchases made after June 30, 1991. Section 6 is
effective for the June 1992 payment and thereafter. Sections 9,
13, 15, and 18 are effective July 1, 1991. Section 12 is
effective for leases or rentals of motor vehicles after June 30,
1991. Section 14 is effective July 1, 1989. Section 17 is
effective for sales after December 31, 1988. Section 21 is
effective July 1, 1990. Sections 7, 8, 10, 11, and 19 are
effective for sales after June 30, 1991. Section 20 is
effective for sales of wine after December 31, 1987. Section 22
is effective the day after approval in compliance with Minnesota
Statutes, section 645.021, subdivision 3, by the city council of
Duluth. Section 23 is effective January 1, 1984. Sections 24,
26, and 29 are effective the day following final enactment.
ARTICLE 9
SPECIAL TAXES
Section 1. Minnesota Statutes 1990, section 43A.316,
subdivision 9, is amended to read:
Subd. 9. [INSURANCE TRUST FUND.] The insurance trust fund
in the state treasury consists of deposits of the premiums
received from employers participating in the plan and transfers
from the public employees insurance reserve holding account
established by section 353.65, subdivision 7. All money in the
fund is appropriated to the commissioner to pay insurance
premiums, approved claims, refunds, administrative costs, and
other related service costs. Premiums paid by employers to the
fund are exempt from the tax imposed by sections 60A.15 and
60A.198. The commissioner shall reserve an amount of money to
cover the estimated costs of claims incurred but unpaid. The
state board of investment shall invest the money according to
section 11A.24. Investment income and losses attributable to
the fund must be credited to the fund.
Sec. 2. Minnesota Statutes 1990, section 60A.19,
subdivision 8, is amended to read:
Subd. 8. [INSURANCE FROM UNLICENSED FOREIGN COMPANIES.]
Any person, firm, or corporation desiring to obtain insurance
upon any property, interests, or risks of any nature other than
life insurance in this state in companies not authorized to do
business therein shall give bond to the commissioner of commerce
in such sum as the commissioner shall deem reasonable, with
satisfactory resident sureties, conditioned that the obligors,
on the expiration of a license to obtain such insurance, shall
pay to the commissioner of revenue, for the use of the state, a
tax of two percent upon the gross premiums paid by the
licensee. Thereupon the commissioner of commerce shall issue
such license, good for one year, and all insurance procured
thereunder shall be lawful and valid and the provisions of all
policies thereof shall be deemed in accordance, and construed as
if identical in effect, with the standard policy prescribed by
the laws of this state and the insurers may enter the state to
perform any act necessary or proper in the conduct of the
business. This bond may be enforced by the commissioner of
commerce in the commissioner's name in any district court. The
licensee shall file with the commissioner of commerce on June 30
and December 31 annually a verified statement of the aggregate
premiums paid and returned premiums received on account of such
insurance.
The commissioner of revenue, or duly authorized agents, may
conduct investigations, inquiries, and hearings to enforce the
tax imposed by this subdivision and, in connection with those
investigations, inquiries, and hearings, the commissioner and
duly authorized agents have all the powers conferred by section
270.06.
Sec. 3. Minnesota Statutes 1990, section 69.54, is amended
to read:
69.54 [SURCHARGE ON PREMIUMS TO RESTORE DEFICIENCY IN
SPECIAL FUND.]
Subdivision 1. [SURCHARGE.] The commissioner shall order
and direct a surcharge to be collected of two percent of the
fire, lightning, and sprinkler leakage gross premiums, less
return premiums, on all direct business received by any licensed
foreign or domestic fire insurance company on property in this
city of the first class, or by its agents for it, in cash or
otherwise. This surcharge shall be due and payable from these
companies to the state treasurer on March 31, May 31, and
October 31 of each calendar year, and if not paid within 30 days
after these dates, a penalty of ten percent shall accrue thereon
and thereafter this sum and penalty shall draw interest at the
rate of one percent per month until paid.
Subd. 2. [ENFORCEMENT.] The commissioner, or duly
authorized agents, may conduct investigations, inquiries, and
hearings to enforce the surcharge imposed by subdivision 1 and,
in connection with those investigations, inquiries, and
hearings, the commissioner and duly authorized agents have the
powers conferred upon the commissioner and examiners by section
270.06.
Sec. 4. Minnesota Statutes 1990, section 216B.36, is
amended to read:
216B.36 [FRANCHISES CONTINUED.]
Any public utility furnishing the utility services
enumerated in section 216B.02 or occupying streets, highways, or
other public property within a municipality may be required to
obtain a license, permit, right or franchise in accordance with
the terms, conditions, and limitations of regulatory acts of the
municipality, including the placing of distribution lines and
facilities underground, and. Under the license, permit, right,
or franchise, the utility may be obligated by any municipality
to pay to the municipality fees to raise revenue or defray
increased municipal costs accruing as a result of utility
operations, or both, including. The fee may include but is not
limited to a sum of money based upon gross operating revenues or
gross earnings from its operations in the municipality so long
as the public utility shall continue to operate in the
municipality, unless upon request of the public utility it is
expressly released from the obligation at any time by such
municipality. Notwithstanding the definition of "public
utility" in section 216B.02, subdivision 4, a municipality may
require payment of a fee under this section by a cooperative
electric association organized under chapter 308A that furnishes
utility services within the municipality. All existing
licenses, permits, franchises and other rights acquired by any
public utility or municipality prior to April 11, 1974,
including the payment of existing franchise fees, shall not be
impaired or affected in any respect by the passage of this
chapter, except with respect to matters of rate and service
regulation, service area assignments, securities and
indebtedness that are vested in the jurisdiction of the
commission by this chapter. However, in the event that a court
of competent jurisdiction determines, or the parties by mutual
agreement determine, that an existing license, permit, franchise
or other right has been abrogated or impaired by this chapter,
or its execution, the municipality affected shall impose and the
public utility shall collect an excise tax on the utility
charges which from year to year yields an amount which is
reasonably equivalent to that amount of revenue which then would
be due as a fee, charges or other thing or service of value to
the municipality under the franchise, license or permit. The
authorization shall be over and above taxing limitations
including, but not limited to those of section 477A.016.
Franchises granted pursuant to this section shall be exempt from
the provisions of chapter 80C. For purposes of this section, a
public utility shall include a cooperative electric association.
Sec. 5. Minnesota Statutes 1990, section 270.60, is
amended to read:
270.60 [TAX REFUND AGREEMENTS WITH INDIANS.]
Subdivision 1. [TAXES PAID BY INDIANS.] The commissioner
of revenue is authorized to enter into a tax refund agreement
with the governing body of any Sioux or Chippewa reservation in
Minnesota. The agreement may provide for a mutually agreed upon
amount as a refund to the governing body of any sales or excise
tax paid by the Indian residents of total resident population on
or adjacent to a reservation into the state treasury, or for an
amount which measures the economic value of an agreement by the
council to pay the equivalent of the state sales tax on items
included in the sales tax base but exempt on the reservation,
notwithstanding any other law which limits the refundment of
taxes. The total resident Indian population on or adjacent to a
reservation shall be defined according to the United States
Department of the Interior, Bureau of Indian Affairs, as
determined and stated in its Report on Service Population and
Labor Force.
Subd. 2. [CIGARETTE TAXES.] The commissioner of revenue is
also authorized to enter into a tax refund agreement with the
governing body of any federally recognized Indian reservation in
Minnesota, for refund of a mutually agreed upon amount of the
cigarette taxes collected from sales on reservations or trust
lands of an Indian tribe to the established governing body of
the tribe having jurisdiction over the reservation or trust land
on which the sale is made.
Subd. 3. [APPROPRIATION.] There is annually appropriated
from the general fund to the commissioner of revenue the amounts
necessary to make the refunds provided in this section.
Sec. 6. Minnesota Statutes 1990, section 295.01,
subdivision 10, is amended to read:
Subd. 10. [TELEPHONE COMPANY.] The term "telephone
company" as used in this chapter means any person, firm,
association or corporation, excluding municipal telephone
companies, owning or operating any telephone line or telephone
exchange for hire wholly or partly within this state, including
radio and other advancements in the art of telephony and sellers
of telephone services, but excluding resellers and cellular
radio. "Resellers of telephone services" as used in this
chapter means any person, firm, association, or corporation that:
(1) resells telecommunications services purchased from
telephone companies as defined in this chapter;
(2) does not own, operate, manage, or control transmission
facilities that have the technological capability to provide
telecommunication services; and
(3) incurs costs equal to at least 50 percent of its gross
revenues for the telephone services purchased from telephone
companies that own, operate, manage, or control transmission
facilities.
Sec. 7. [295.367] [TAX ON 900 PAY-PER-CALL SERVICES.]
Subdivision 1. [TAX IMPOSED.] A tax at a rate of 7.5
percent is imposed on the gross earnings of a billing agency
from providing the services described in subdivision 2,
paragraph (c), for calls placed to 900 services after August 31,
1991.
Subd. 2. [DEFINITIONS.] (a) For purposes of this section,
the following terms have the meanings given.
(b) "900 service" means pay-per-call 900 information
services provided through a telephone exchange, commonly
accessed by dialing 1-900, 1-960, 1-976, or other similar prefix.
(c) "Billing agency" means the person or entity responsible
for billing and collection of the charges for 900 services from
the purchaser of the service.
Subd. 3. [PAYMENT; ADMINISTRATION.] (a) If the billing
agency is a telephone company, the tax must be paid, collected,
and administered at the times and in the manner provided for the
gross earnings tax, and the tax shall be considered a tax
imposed under sections 295.34 to 295.366.
(b) If the billing agency is not a telephone company, the
tax shall be paid, collected, and administered as if the tax
were a sales tax imposed under section 297A.02 and all the rules
applicable under chapters 270B, 289A, and 297A apply to the tax.
Sec. 8. Minnesota Statutes 1990, section 296.01,
subdivision 25, is amended to read:
Subd. 25. [ALTERNATE FUEL PERMIT.] "Alternate fuel permit"
means a permit issued annually to a person owning a motor
vehicle propelled by compressed natural gas or, propane, or any
other manner except gasoline or special fuel, for a fee imposed
in lieu of payment of the gasoline excise tax imposed by
sections 296.02 and 296.025.
Sec. 9. Minnesota Statutes 1990, section 296.026,
subdivision 1, is amended to read:
Subdivision 1. [ANNUAL ALTERNATE FUEL PERMIT.] Any A
person owning a motor vehicle propelled by compressed natural
gas or, propane, or any other manner except gasoline or special
fuel, shall obtain an annual permit for each such that vehicle
in accordance with subdivision 2 or 2a. The period for which
the alternate fuel permit is valid must coincide with the motor
vehicle registration period of the vehicle. A person shall
obtain all required permits within 30 days of becoming a user of
compressed natural gas or, propane, or any other method of
propulsion except gasoline or special fuel.
Sec. 10. Minnesota Statutes 1990, section 296.026,
subdivision 2, is amended to read:
Subd. 2. [PERMIT FEES IMPOSED.] The fees for annual
alternate fuel permits are based on each vehicle's mileage in
the preceding year and are as follows:
Gross Vehicle Weight Fee
Under 6,000 6,001 pounds $8.80 per 1,000 miles
6,001 - 12,000 pounds $10.60 per 1,000 miles
12,00l - 18,000 pounds $18.80 per 1,000 miles
18,001 - 26,000 pounds $27.10 per 1,000 miles
26,001 - 36,000 pounds $31.80 per 1,000 miles
Over 36,000 pounds $40.00 per 1,000 miles
A log with validating receipts pertaining to the vehicle's
out of state mileage may be supplied to the commissioner of
public safety at the time of permit application to be subtracted
from the actual mileage for the purpose of calculating the
permit fee. If no true cumulative mileage figures are available
for the preceding year, the fee charged under this section must
be based on 15,000 miles driven within the state.
The fee for a permit required by this section must be
calculated based on the number of unexpired months remaining in
the registration year of the vehicle as measured from the date
of the occurrence of the event requiring the permit.
Sec. 11. Minnesota Statutes 1990, section 296.026, is
amended by adding a subdivision to read:
Subd. 2a. [OPTIONAL METHOD OF DETERMINING PERMIT
FEES.] (a) The owner of a motor vehicle covered by this section
may, at the owner's option, pay a permit fee determined under
this subdivision if the vehicle is capable of being propelled by
gasoline as well as compressed natural gas or propane.
(b) The fee for a permit under this subdivision is based on
each vehicle's mileage in the previous year while propelled by
compressed natural gas or propane and are as follows:
(1) for a vehicle with a gross vehicle weight under 6,001
pounds, .9 cents a mile; or
(2) for a vehicle with a gross vehicle weight of 6,001
pounds to 12,000 pounds, one cent a mile; or
(3) for a vehicle with a gross vehicle weight of 12,001 to
18,000 pounds, 1.9 cents a mile; or
(4) for a vehicle with a gross vehicle weight of 18,001 to
26,000 pounds, 2.7 cents a mile; or
(5) for a vehicle with a gross vehicle weight of 26,001 to
36,000 pounds, 3.2 cents a mile; or
(6) for a vehicle with a gross vehicle weight over 36,000
pounds, 4 cents a mile.
An owner opting to pay a fee calculated under this
subdivision shall submit a log, with validating receipts
pertaining to the vehicle's mileage while propelled by
compressed natural gas or propane and its mileage while
propelled by gasoline, to the commissioner of public safety upon
application for the permit.
Sec. 12. Minnesota Statutes 1990, section 296.026, is
amended by adding a subdivision to read:
Subd. 2b. [MILEAGE CALCULATIONS.] A log with validating
receipts pertaining to the vehicle's out-of-state mileage may be
supplied to the commissioner of public safety at the time of
permit application to be subtracted from the actual mileage for
the purpose of calculating the permit fee. If no true
cumulative mileage figures are available for the preceding year,
the fee must be based on 15,000 miles driven within the state
for a fee determined under subdivision 2 or 7,500 miles driven
within the state for a fee determined under subdivision 2a, if
the vehicle is primarily used for nonbusiness purposes.
The fee for a permit required by this section must be
calculated based on the number of unexpired months remaining in
the registration year of the vehicle as measured from the date
of the occurrence of the event requiring the permit.
Sec. 13. Minnesota Statutes 1990, section 296.026,
subdivision 7, is amended to read:
Subd. 7. [FEES IN LIEU OF GAS TAX.] The permit fees
collected under subdivision 2 are in lieu of the gasoline excise
tax imposed by sections 296.02 and 296.025. Compressed natural
gas or, propane sold, or any other method of propulsion sold as
fuel for motor vehicles displaying valid annual alternate fuel
permit stickers is not subject to any additional tax at the time
of sale. All alternate fuel permit fees collected by the
department of public safety must be deposited in the state
treasury and credited to the highway user tax distribution fund.
Sec. 14. [296.165] [UNTAXED GASOLINE AND SPECIAL FUEL;
SEIZURE AND FORFEITURE.]
Subdivision 1. [SEIZURE.] The commissioner or authorized
designees may seize gasoline or special fuel being transported
for delivery in violation of section 296.06, subdivision 1, and
any vehicle or other method of conveyance used for transporting
the gasoline or special fuel. Property seized under this
subdivision is subject to forfeiture as provided in subdivisions
2 and 3.
Subd. 2. [INVENTORY.] Within two days after the seizure of
gasoline or special fuel, the person making the seizure shall
deliver an inventory of the property seized to the person from
whom the seizure was made, if known, and file a copy with the
office of the commissioner. Within ten days after the date of
service of the inventory, the person from whom the property was
seized or any person claiming an interest in the property may
file with the commissioner a demand for a judicial determination
of whether the property was lawfully subject to seizure and
forfeiture. The commissioner, within 30 days of demand for a
judicial determination, shall begin an action in the district
court of the county where the seizure was made to determine the
issue of forfeiture. The action must be brought in the name of
the state and prosecuted by the county attorney or by the
attorney general. The court shall hear the action without a
jury and shall try and determine the issues of fact and law
involved. When a judgment of forfeiture is entered, the
commissioner may, unless the judgment is stayed pending an
appeal, either (1) cause the forfeited property to be destroyed;
or (2) cause it to be sold at public auction as provided by
law. Proceeds of a sale, after deducting the expense of keeping
the gasoline or special fuel and costs of the sale, must be paid
into the state treasury. The commissioner shall reimburse
designees for costs incurred. If a demand for judicial
determination is made and no action is commenced as provided in
this subdivision, the property must be released by the
commissioner and redelivered to the person entitled to it. If
no demand is made, the property seized must be considered
forfeited to the state by operation of law and may be disposed
of by the commissioner as provided where there has been a
judgment of forfeiture. When the commissioner is satisfied that
a person from whom property is seized under this chapter was
acting in good faith and without intent to evade the tax, the
commissioner shall release the property seized, without further
legal proceedings.
Subd. 3. [CONVEYANCES.] (a) The commissioner or authorized
designees shall file with the court a separate complaint against
the vehicle or conveyance, describing it and charging its use in
the specified violation, and specifying substantially the time
and place of the unlawful use. A copy of the complaint must be
served on the defendant or person in charge of the vehicle or
conveyance at the time of seizure, if any. The court shall
issue an order directed to any person known or believed to have
a right or title to, interest in, or lien on the vehicle or
conveyance and to persons unknown claiming a right, title,
interest, or lien:
(1) describing the vehicle or conveyance and stating that
it was seized and that a complaint against it, charging the
specified violation, has been filed with the court;
(2) requiring the persons to file with the court
administrator of the court their answer to the complaint,
setting forth any claim they may have to a right or title to,
interest in, or lien on the vehicle or conveyance, within ten
days after the service of the order; and
(3) notifying them in substance that if they fail to file
their answer within that time the vehicle or conveyance will be
ordered sold by the commissioner.
(b) The court shall cause the order to be served on:
(1) the registered owner;
(2) any person who has duly filed a conditional sales
contract, mortgage, or other lien instrument covering the
property unless it has been released or satisfied;
(3) any other person known or believed to have a right,
title, interest in, or lien upon, the vehicle or conveyance as
in the case of a summons in a civil action; and
(4) on unknown persons by publication, as provided for
service of summons in a civil action.
(c) If no answer is filed within the time prescribed, the
court shall, on affidavit by the court administrator of the
court setting forth that fact, order the vehicle or conveyance
forfeited and direct that it be sold by the commissioner or the
commissioner's agents. The proceeds of the sale, after
deducting the expense of keeping the vehicle or conveyance and
costs of the sale, including any costs incurred pursuant to
paragraph (f), must be paid into the state treasury. The
commissioner shall reimburse designees for costs incurred.
(d) If an answer is filed within the time provided, the
court shall fix a time for hearing at least ten but no more than
30 days after the time for filing the answer expires. At the
hearing, the matter must be heard and determined by the court,
without a jury, as in other civil actions. If the court finds
that the vehicle or conveyance, or any part of it, was used in a
violation as specified in the complaint, it shall order the
vehicle or conveyance forfeited and direct that it be sold, as
provided in this section, unless the owner shows to the
satisfaction of the court that the vehicle was being used
without the owner's consent or that, when giving the consent,
the owner had no notice or knowledge or reason to believe that
the vehicle or conveyance was intended to be used in a
violation. After deducting the expense of keeping the vehicle
or conveyance and costs of the sale, the officer making the sale
shall pay, according to their priority, all liens established at
the hearing as being bona fide and existing without the lienor
having any notice or knowledge at the time the lien was created
that the vehicle or conveyance was being used or was intended to
be used in connection with any violation, and shall pay the
balance of the proceeds into the state treasury. The
commissioner shall reimburse designees for costs incurred. A
sale under this section frees the conveyance sold from all liens.
(e) At any time after seizure and before the hearing, the
vehicle or conveyance must be returned to the owner or person
having a legal right to its possession on execution by that
person of a valid bond to the state of Minnesota, with corporate
surety, of at least $100 but not more than double the value of
the vehicle or conveyance seized, to be approved by the court in
which the case is triable, or a judge of that court. The bond
must guarantee compliance with the order and judgment of the
court, and, if ordered by the court, payment of the full value
of the vehicle or conveyance at the time of seizure.
(f) If the seized vehicle or conveyance is owned or
operated by a for-hire common or contract motor carrier, and was
being used without knowledge of the violation, the commissioner
shall return the vehicle or conveyance to its owner or operator
as soon as possible without need for court order, and shall
provide to such owner or operator reasonable compensation for
the time during which the vehicle or conveyance is held pursuant
to seizure.
Sec. 15. Minnesota Statutes 1990, section 297.01,
subdivision 7, is amended to read:
Subd. 7. "Distributor" means any and each of the following:
(1) any person engaged in the business of selling
cigarettes in this state and who manufactures or who brings, or
causes to be brought, into this state from without the state any
packages of cigarettes for sale to subjobbers or retailers;
(2) any person engaged in the business without this state
who ships or transports cigarettes to retailers in this state,
to be sold by those retailers;
(3) any person who is on direct purchase from a cigarette
manufacturer and applies cigarette stamps or indicia on at least
50 percent of cigarettes sold by that person.
A distributor who also sells at retail must maintain a
separate inventory, substantiated with invoices for cigarettes
that were acquired for retail sale.
A distributor may transfer another state's stamped
cigarettes to another distributor for the purpose of resale in
the other state.
Sec. 16. Minnesota Statutes 1990, section 297.02,
subdivision 1, is amended to read:
Subdivision 1. [RATES.] A tax is hereby imposed upon the
sale of cigarettes in this state or having cigarettes in
possession in this state with intent to sell and upon any person
engaged in business as a distributor thereof, at the following
rates, subject to the discount provided in section 297.03:
(1) On cigarettes weighing not more than three pounds per
thousand, 19 21.5 mills on each such cigarette;
(2) On cigarettes weighing more than three pounds per
thousand, 38 43 mills on each such cigarette.
Sec. 17. Minnesota Statutes 1990, section 297.03,
subdivision 1, is amended to read:
Subdivision 1. [STAMP PUT ON BY DISTRIBUTOR.] Except as
otherwise provided in this section payment of the tax imposed by
section 297.02 shall be evidenced by stamps affixed to each
package. Before delivering, or causing to be delivered, any
package to any person in this state, every distributor shall
firmly affix to each package of cigarettes appropriate stamps in
amounts equal to the tax on those cigarettes as provided for in
section 297.02.
Sec. 18. Minnesota Statutes 1990, section 297.03,
subdivision 2, is amended to read:
Subd. 2. [TIME OF AFFIXING STAMP.] The commissioner may
require, in all cases where cigarettes are shipped into this
state by any licensed distributor from without this state, that
the appropriate stamp shall be affixed to the package at the
time the same enters this state.
Sec. 19. Minnesota Statutes 1990, section 297.03,
subdivision 4, is amended to read:
Subd. 4. [STAMPS; DESIGN, PRINTING.] The commissioner
shall adopt the design of the two stamps and. One stamp shall
be designed for application to cigarette packages destined for
retail sale on an Indian reservation which is a party to an
agreement pursuant to section 270.60, subdivision 2, and only to
those packages. A second stamp shall be designed for all other
cigarette packages subject to the provisions of this chapter.
The commissioner shall arrange for the printing thereof in such
amounts and denominations as the commissioner deems necessary.
Sec. 20. Minnesota Statutes 1990, section 297.03,
subdivision 5, is amended to read:
Subd. 5. [SALE OF STAMPS.] The commissioner shall sell
stamps to any person licensed as a distributor at a discount of
1.25 1.1 percent from the face amount of the stamps for the
first $1,500,000 of such stamps purchased in any fiscal year;
and at a discount of .75 .65 percent on the remainder of such
stamps purchased in any fiscal year. The commissioner shall not
sell stamps to any other person. The commissioner may prescribe
the method of shipment of the stamps to the distributor as well
as the quantities of stamps purchased.
Sec. 21. Minnesota Statutes 1990, section 297.03,
subdivision 6, is amended to read:
Subd. 6. [TAX METER MACHINES; STAMPING MACHINES.] (a)
Before July 1, 1990, the commissioner may authorize any person
licensed as a distributor to stamp packages with a tax meter
machine, approved by the commissioner, which shall be provided
by the distributor. The commissioner may provide for the use of
such a machine by the distributor, supervise and check its
operation, provide for the payment of the tax on any package so
stamped, subject to the discount provided in subdivision 5.
(b) After June 30, 1990, The commissioner shall require any
person licensed as a distributor to stamp packages with a
heat-applied tax stamping machine, approved by the commissioner,
which shall be provided by the distributor. The commissioner
shall supervise and check the operation of the machines and
shall provide for the payment of the tax on any package so
stamped, subject to the discount provided in subdivision 5. The
commissioner may sell heat-applied stamps on a credit basis
under conditions prescribed by the commissioner. The stamps
shall be sold by the commissioner at a price which includes the
tax after giving effect to the discount provided in subdivision
5. The commissioner shall recover the actual costs of the
stamps from the distributor.
(c) (b) If the commissioner finds that a stamping machine
is not affixing a legible stamp on the package, the commissioner
may order the distributor to immediately cease the stamping
process until the machine is functioning properly.
(d) (c) The commissioner shall annually establish the
maximum amount of heat applied stamps that may be purchased each
month. Notwithstanding any other provisions of this chapter,
the tax due on the return will be based upon actual heat applied
stamps purchased during the reporting period.
Sec. 22. Minnesota Statutes 1990, section 297.07,
subdivision 5, is amended to read:
Subd. 5. [OFFSET.] Upon audit, if a distributor's return
reflects an overage resulting from an inventory counting error,
the overage shall be offset against a shortage, if any, in the
month immediately preceding the month of the overage. If any
overage remains after that offset, the remainder may only be
offset against a shortage, if any, in the month immediately
following the month of the overage. If the commissioner
determines that the overage is attributable to a mistake by the
distributor other than an inventory counting error, the
commissioner may permit the overage to be offset against a
shortage in any month or months during the 12-month period
immediately following the month when the overage was discovered
upon audit.
Sec. 23. Minnesota Statutes 1990, section 297.08,
subdivision 1, is amended to read:
Subdivision 1. [CONTRABAND DEFINED.] The following are
declared to be contraband:
(1) All packages which do not have stamps affixed to them
as provided in sections 297.01 to 297.13 and all devices for the
vending of cigarettes in which such unstamped packages are
found, including all contents contained within the devices.
(2) Any device for the vending of cigarettes and all
packages of cigarettes contained therein, where the device does
not afford at least partial visibility of contents. Where any
package exposed to view does not carry the stamp required by
sections 297.01 to 297.13, it shall be presumed that all
packages contained in the device are unstamped and contraband.
(3) Any device for the vending of cigarettes to which the
commissioner or authorized agents have been denied access for
the inspection of contents. In lieu of seizure, the
commissioner or an agent may seal the device to prevent its use
until inspection of contents is permitted.
(4) Any device for the vending of cigarettes which does not
carry the name and address of the owner, plainly marked and
visible from the front of the machine.
(5) Any device including, but not limited to, motor
vehicles, trailers, snowmobiles, airplanes, and boats used with
the knowledge of the owner or of a person operating with the
consent of the owner for the storage or transportation of more
than 5,000 cigarettes which are contraband under this
subdivision. When cigarettes are being transported in the
course of interstate commerce, or are in movement from either a
public warehouse to a distributor upon orders from a
manufacturer or distributor, or from one distributor to another,
the cigarettes are not contraband, notwithstanding the
provisions of clause (1).
(6) All packages obtained in violation of section 297.11,
subdivision 6.
(7) All packages offered for sale or held as inventory in
violation of section 297.11, subdivision 7.
Sec. 24. Minnesota Statutes 1990, section 297.11,
subdivision 1, is amended to read:
Subdivision 1. [COUNTERFEITING, TAMPERING WITH TAX METER.]
No person shall, with intent to defraud the state, make, alter,
forge, or counterfeit any license or stamp provided for in
sections 297.01 to 297.13 or have in possession any forged,
spurious, or altered stamps, or tamper with or reset any tax
meter machine with the intent, or with the result, of depriving
the state of the tax imposed by sections 297.01 to 297.13.
Sec. 25. Minnesota Statutes 1990, section 297.11, is
amended by adding a subdivision to read:
Subd. 6. [PROHIBITION AGAINST SALES BY UNLICENSED
SELLERS.] No retailer or subjobber shall purchase cigarettes
from any person who is not licensed under section 297.04 as a
cigarette distributor or subjobber.
Sec. 26. Minnesota Statutes 1990, section 297.11, is
amended by adding a subdivision to read:
Subd. 7. [SALE OF PACKAGES WITH INDIAN STAMP.] No retailer
doing business off of an Indian reservation shall offer for sale
or possess as inventory packages affixed with the stamp designed
for Indian reservations.
Sec. 27. [297.385] [PROHIBITION.]
Subdivision 1. [SALES BY UNLICENSED SELLERS.] No retailer
or subjobber shall purchase tobacco products from any person who
is not licensed under section 297.33 as a tobacco products
distributor or subjobber.
Subd. 2. [SEIZURE.] Tobacco products purchased in
violation of subdivision 1 may be seized by the commissioner or
authorized agents or by any sheriff or other police officer,
with or without process, and shall be subject to forfeiture as
provided in section 297.08, subdivision 3.
Sec. 28. Minnesota Statutes 1990, section 297.43, is
amended by adding a subdivision to read:
Subd. 10. [STATUTE OF LIMITATIONS.] Notwithstanding
section 628.26, or other provision of the criminal laws of this
state, an indictment may be found and filed or a complaint filed
upon a criminal offense specified in this chapter, in the proper
court within six years after the offense is committed.
Sec. 29. Minnesota Statutes 1990, section 297C.03,
subdivision 6, is amended to read:
Subd. 6. [INFORMATIONAL RETURNS.] Manufacturers,
wholesalers, and importers licensed to ship distilled spirits or
wine into Minnesota shall file with the commissioner a monthly
informational report on a form prescribed by the commissioner.
No payment of any tax is required to be remitted with this
report. The report must be filed on or before the tenth day
following the end of each calendar month, regardless of whether
or not any shipments were made into Minnesota during the
previous month, unless the commissioner determines that a longer
filing period is appropriate for a particular manufacturer,
wholesaler, or importer. A person failing to file this monthly
report is subject to the provisions of section 297C.14,
subdivision 8.
Sec. 30. Minnesota Statutes 1990, section 297C.10, is
amended by adding a subdivision to read:
Subd. 3. [PHYSICAL INVENTORY.] The commissioner of revenue
or the commissioner's authorized agents may, upon request but
not more than twice annually, require a brewer, manufacturer,
wholesaler, or retailer to furnish a physical inventory of all
wine and distilled spirits in stock. The inventory must contain
the information that the commissioner requests and must be
certified by an officer of the corporation.
Sec. 31. Minnesota Statutes 1990, section 297D.01,
subdivision 3, is amended to read:
Subd. 3. "Dealer" "Tax obligor" or "obligor" means a
person who in violation of Minnesota law manufactures, produces,
ships, transports, or imports into Minnesota or in any manner
acquires or possesses more than 42-1/2 grams of marijuana, or
seven or more grams of any controlled substance, or ten or more
dosage units of any controlled substance which is not sold by
weight. A quantity of marijuana or other controlled substance
is measured by the weight of the substance whether pure or
impure or dilute, or by dosage units when the substance is not
sold by weight, in the dealer's tax obligor's possession. A
quantity of a controlled substance is dilute if it consists of a
detectable quantity of pure controlled substance and any
excipients or fillers.
Sec. 32. Minnesota Statutes 1990, section 297D.02, is
amended to read:
297D.02 [ADMINISTRATION.]
The commissioner of revenue shall administer this chapter.
Payments required by this chapter must be made to the
commissioner on the form provided by the commissioner. Dealers
Tax obligors are not required to give their name, address,
social security number, or other identifying information on the
form. The commissioner shall collect all taxes under this
chapter.
Sec. 33. Minnesota Statutes 1990, section 297D.04, is
amended to read:
297D.04 [TAX PAYMENT REQUIRED FOR POSSESSION.]
No dealer tax obligor may possess any marijuana or
controlled substance upon which a tax is imposed by section
297D.08 unless the tax has been paid on the marijuana or other
controlled substance as evidenced by a stamp or other official
indicia.
Sec. 34. Minnesota Statutes 1990, section 297D.05, is
amended to read:
297D.05 [NO IMMUNITY.]
Nothing in this chapter may in any manner provide immunity
for a dealer tax obligor from criminal prosecution pursuant to
Minnesota law.
Sec. 35. Minnesota Statutes 1990, section 297D.07, is
amended to read:
297D.07 [MEASUREMENT.]
For the purpose of calculating the tax under section
297D.08, a quantity of marijuana or other controlled substance
is measured by the weight of the substance whether pure or
impure or dilute, or by dosage units when the substance is not
sold by weight, in the dealer's tax obligor's possession. A
quantity of a controlled substance is dilute if it consists of a
detectable quantity of pure controlled substance and any
excipients or fillers.
Sec. 36. Minnesota Statutes 1990, section 297D.09,
subdivision 1, is amended to read:
Subdivision 1. [PENALTIES.] Any dealer tax obligor
violating this chapter is subject to a penalty of 100 percent of
the tax in addition to the tax imposed by section 297D.08. The
penalty will be collected as part of the tax.
Sec. 37. Minnesota Statutes 1990, section 297D.09,
subdivision 1a, is amended to read:
Subd. 1a. [CRIMINAL PENALTY; SALE WITHOUT AFFIXED STAMPS.]
In addition to the tax penalty imposed, a dealer tax obligor
distributing or possessing marijuana or controlled substances
without affixing the appropriate stamps, labels, or other
indicia is guilty of a crime and, upon conviction, may be
sentenced to imprisonment for not more than seven years or to
payment of a fine of not more than $14,000, or both.
Sec. 38. Minnesota Statutes 1990, section 297D.11, is
amended to read:
297D.11 [PAYMENT DUE.]
Subdivision 1. [STAMPS AFFIXED.] When a dealer tax obligor
purchases, acquires, transports, or imports into this state
marijuana or controlled substances on which a tax is imposed by
section 297D.08, and if the indicia evidencing the payment of
the tax have not already been affixed, the dealer tax obligor
shall have them permanently affixed on the marijuana or
controlled substance immediately after receiving the substance.
Each stamp or other official indicia may be used only once.
Subd. 2. [PAYABLE ON POSSESSION.] Taxes imposed upon
marijuana or controlled substances by this chapter are due and
payable immediately upon acquisition or possession in this state
by a dealer tax obligor.
Sec. 39. Minnesota Statutes 1990, section 297D.12,
subdivision 1, is amended to read:
Subdivision 1. [ASSESSMENT PROCEDURE.] An assessment for a
dealer tax obligor not possessing valid stamps or other official
indicia showing that the tax has been paid shall be considered a
jeopardy assessment or collection, as provided in section
270.70. The commissioner shall assess a tax and applicable
penalties based on personal knowledge or information available
to the commissioner; mail the taxpayer at the taxpayer's last
known address or serve in person, a written notice of the amount
of tax and penalty; demand its immediate payment; and, if
payment is not immediately made, collect the tax and penalty by
any method prescribed in chapter 270, except that the
commissioner need not await the expiration of the times
specified in chapter 270.
Sec. 40. Minnesota Statutes 1990, section 297D.13,
subdivision 1, is amended to read:
Subdivision 1. [DISCLOSURE PROHIBITED.] Notwithstanding
any law to the contrary, neither the commissioner nor a public
employee may reveal facts contained in a report or return
required by this chapter or any information obtained from
a dealer tax obligor; nor can any information contained in such
a report or return or obtained from a dealer tax obligor be used
against the dealer tax obligor in any criminal proceeding,
unless independently obtained, except in connection with a
proceeding involving taxes due under this chapter from
the dealer tax obligor making the return.
Sec. 41. Minnesota Statutes 1990, section 297D.13,
subdivision 3, is amended to read:
Subd. 3. [STATISTICS.] This section does not prohibit the
commissioner from publishing statistics that do not disclose the
identity of dealers tax obligors or the contents of particular
returns or reports.
Sec. 42. Minnesota Statutes 1990, section 297D.14, is
amended to read:
297D.14 [INVESTIGATORY POWERS.]
For the purpose of determining the correctness of any
return, determining the amount of tax that should have been
paid, determining whether or not the dealer tax obligor should
have made a return or paid taxes, or collecting any taxes under
this chapter, the commissioner may examine, or cause to be
examined, any books, papers, records, or memoranda, that may be
relevant to making such determinations, whether the books,
papers, records, or memoranda, are the property of or in the
possession of the dealer tax obligor or another person. The
commissioner may require the attendance of any person having
knowledge or information that may be relevant, compel the
production of books, papers, records, or memoranda by persons
required to attend, take testimony on matters material to the
determination, and administer oaths or affirmations. Upon
demand of the commissioner or any examiner or investigator, the
court administrator of any court shall issue a subpoena for the
attendance of a witness or the production of books, papers,
records, and memoranda. The commissioner may also issue
subpoenas. Disobedience of subpoenas issued under this chapter
is punishable by the district court of the district in which the
subpoena is issued, or, if the subpoena is issued by the
commissioner, by the district court of the district in which the
party served with the subpoena is located, in the same manner as
contempt of district court.
Sec. 43. Minnesota Statutes 1990, section 325D.32,
subdivision 10, is amended to read:
Subd. 10. (a) "Cost to wholesaler" means the basic cost of
the cigarettes, prior to deducting manufacturer's timely payment
and stamping discounts and any other discounts or rebates, plus
the cost of doing business by the wholesaler, as defined in
sections 325D.30 to 325D.42.
(b) In the absence of proof of a lesser or higher cost, the
cost of doing business by the wholesaler is presumed to be four
percent of the basic cost of the cigarettes, plus cartage to the
retail outlet, if furnished or paid for by the wholesaler, in
the absence of proof of a lesser or higher cost. Such cartage
cost is presumed to be one-half of one percent of the basic cost
of the cigarettes in the absence of proof of a lesser or higher
cost. A manufacturer's timely payment and stamping discounts
and any other discounts or rebates shall not be deducted in
determining the cost of doing business by the wholesaler,
whether it is determined under the percentage formula set forth
in this paragraph or proof of actual cost.
(c) A wholesaler electing to sell cigarettes at a price
other than that presumed by law must submit to the commissioner
documentation substantiating the actual cost of the cigarettes
before selling at actual cost. For purposes of this paragraph
"actual cost" means basic cost as defined in subdivision 9 plus
the wholesaler's cost of doing business. The commissioner shall
review the documents submitted and, if necessary, request
additional documentation to verify the accuracy of the cost
computations. If, within 15 days of submission of the
documentation, the commissioner has not notified the wholesaler
of any deficiencies in the cost computations, the wholesaler may
begin selling at actual cost. The cost computations are
effective for a period of not more than 12 months beginning 15
days after submission of the documentation. Fifteen days before
expiration of the 12-month period, the wholesaler must submit
new cost documentation for review by the commissioner to
continue selling at less than the price presumed by law. New
cost documentation must also be submitted to the commissioner on
the last day of a month in which the basic cost of cigarettes
increases.
Sec. 44. [325D.405] [INVESTIGATIONS.]
The commissioner or duly authorized agents may conduct
investigations to determine compliance with the provisions of
sections 325D.30 to 325D.42 and, in connection with such
investigations, the commissioner and duly authorized agents have
all the powers conferred upon the commissioner by section 270.06.
Sec. 45. [UNDERPAYMENT OF GROSS EARNINGS TAX.]
No addition to tax or an amount in lieu of interest may be
made or imposed under Minnesota Statutes, section 295.34,
subdivision 1, with respect to an underpayment of March 15,
1991, and June 15, 1991, payments of estimated gross earnings
tax, to the extent the underpayment was created or increased by
the extension of the tax to cellular radios under this article.
Sec. 46. [REPEALER.]
Minnesota Statutes 1990, section 296.028, is repealed.
Sec. 47. [EFFECTIVE DATE.]
Section 1 is effective retroactive to August 1, 1990.
Sections 4, 29, and 30 are effective July 1, 1991. Section 6 is
effective January 1, 1991. Sections 8 to 13 are effective for
permits issued after June 30, 1991. Sections 14, 22, and 45 are
effective the day following final enactment. Sections 16 and 20
are effective June 1, 1991. Section 28 is effective for
offenses committed after June 30, 1988. Sections 17 to 19, 23,
25, 26, and 27 are effective January 1, 1992.
ARTICLE 10
TAX INCREMENT FINANCING
Section 1. Minnesota Statutes 1990, section 273.1399,
subdivision 1, is amended to read:
Subdivision 1. [DEFINITIONS.] For purposes of this
section, the following terms have the meanings given.
(a) "Qualifying captured tax capacity" means the following
amounts:
(1) the captured tax capacity of a new or the expanded part
of an existing economic development or soils condition tax
increment financing district, other than a qualified
manufacturing district, for which certification was requested
after April 30, 1990; and
(2) the captured tax capacity of a qualified manufacturing
district, multiplied by the following percentage based on the
number of years that have elapsed since the district was first
certified (measured from January 2 immediately preceding
certification of the original tax capacity). In no case may the
final amounts be less than zero or greater than the total
captured tax capacity of the district:
Number of Years Percentage
1 0
2 20
3 40
4 60
5 80
6 or more 100;
(3) the captured tax capacity of a new or the expanded part
of an existing tax increment financing district, other than an
economic development or soils condition district, for which
certification was requested after April 30, 1990, multiplied by
the following percentage based on the number of years that have
elapsed since the district was first certified (measured from
January 2 immediately preceding certification of the original
tax capacity). In no case may the final amounts be less than
zero or greater than the total captured tax capacity of the
district.
Number of Renewal and All other
years Renovation Districts
Districts
0 to 5 0 0
6 12.5 6.25
7 25 12.5
8 37.5 18.75
9 50 25
10 62.5 31.25
11 75 37.5
12 87.5 43.75
13 100 50
14 100 56.25
15 100 62.5
16 100 68.75
17 100 75
18 100 81.25
19 100 87.5
20 100 93.75
21 or more 100 100
In the case of a hazardous substance subdistrict, the
number of years must be measured from the date of certification
of the subdistrict for purposes of the additional captured tax
capacity resulting from the reduction in the subdistrict's or
site's original tax capacity.
(b) The terms defined in section 469.174 have the meanings
given in that section.
(c) "Qualified manufacturing district" means an economic
development district that qualifies under section 469.176,
subdivision 4c, paragraph (a), without regard to clauses (2) and
(4), for which certification was requested after June 30, 1991,
located in a home rule charter or statutory city that (1) has a
population under 10,000 according to the last federal census and
(2) is wholly located outside of a metropolitan statistical area
as determined by the United States Office of Management and
Budget.
Sec. 2. Minnesota Statutes 1990, section 273.1399,
subdivision 3, is amended to read:
Subd. 3. [CALCULATION OF EDUCATION AIDS.] For each school
district containing qualifying captured tax capacity, the
commissioner of education shall compute a hypothetical state aid
amount that would be paid to the school district if the
qualifying captured tax capacity were divided by the sales ratio
and included in the school district's adjusted tax capacity for
purposes of calculating equalized levies as defined in section
273.1398, subdivision 2a, and associated state aids. The
commissioner of education shall notify the commissioner of
revenue of the difference between the actual aid paid and the
hypothetical aid amounts calculated for each school district,
broken down by the municipality that approved the tax increment
financing district containing the qualifying captured tax
capacity. The resulting amount is the reduction in state tax
increment financing aid.
Sec. 3. Minnesota Statutes 1990, section 469.012,
subdivision 8, is amended to read:
Subd. 8. [INTEREST REDUCTION PROGRAM; LIMITATIONS.] In
developing the interest reduction program authorized by
subdivision 7 the authority shall consider:
(1) the availability and affordability of other
governmental programs;
(2) the availability and affordability of private market
financing; and
(3) the need for additional affordable mortgage credit to
encourage the construction and enable the purchase of housing
units within the jurisdiction of the authority.
The authority shall adopt rules for the interest reduction
program. Interest reduction assistance shall not be provided if
the authority determines that financing for the purchase of a
housing unit or for the construction or rehabilitation of
housing units is otherwise available from private lenders upon
terms and conditions that are affordable by the applicant, as
provided by the authority in its rules.
For the purposes of this subdivision an "assisted housing
unit" is a housing unit which is rented or to be rented and
which is a part of a rental housing development where the
financing for the rental housing development is assisted with
interest reduction assistance provided by the authority during
the calendar year. If interest reduction assistance is provided
for construction period interest for a rental housing
development, the housing units in the housing development shall
be considered assisted housing units for a period after
occupancy of the housing units which is equal to the period
during which interest reduction assistance is provided to assist
the construction financing of the rental housing development.
In any calendar year when an authority provides interest
reduction assistance for assisted housing units (1) at least 20
percent of the total assisted housing units within the
jurisdiction of the authority shall be held available for rental
to families or individuals with an adjusted gross income which
is equal to or less than 80 percent of the median family income,
and (2) at least an additional 55 percent of the total assisted
housing units within the jurisdiction of the authority shall be
held available for rental to individuals or families with an
annual adjusted gross income which is equal to or less than 66
times 120 percent of the monthly fair market rent for the unit
established by the United States Department of Housing and Urban
Development. At least 80 percent of the aggregate dollar amount
of funds appropriated by an authority within any calendar year
to provide interest reduction assistance for financing of
construction, rehabilitation, or purchase of single family
housing, as that term is defined in section 462C.02, subdivision
4, shall be appropriated for housing units that are to be sold
to or occupied by families or individuals with an adjusted gross
income which is equal to or less than 110 percent of median
family income. For the purposes of this subdivision, "median
family income" means the median family income established by the
United States Department of Housing and Urban Development for
the nonmetropolitan county or the standard metropolitan
statistical area, as the case may be. The adjusted gross income
may must be adjusted by the authority for family size. The
limitations imposed upon assisted housing units by this
subdivision do not apply to interest reduction assistance for a
rental housing development located in a targeted area as defined
in section 462C.02. An authority that establishes a program
pursuant to this subdivision shall by January 2 each year report
to the commissioner of trade and economic development a
description of the program established and a description of the
recipients of interest reduction assistance.
Sec. 4. Minnesota Statutes 1990, section 469.174,
subdivision 7, is amended to read:
Subd. 7. [ORIGINAL NET TAX CAPACITY.] (a) Except as
provided in paragraph (b), "original net tax capacity" means the
tax capacity of all taxable real property within a tax increment
financing district as most recently certified by the
commissioner of revenue as of the date of for the previous
assessment year, provided that the request by an authority for
certification by of a new tax increment financing district or
for the expansion of an existing district has been made to the
county auditor, by June 30. The original tax capacity of
districts for which requests are filed after June 30 has an
original tax capacity based on the current assessment year. In
any case, the original tax capacity must be determined together
with subsequent adjustments as set forth in section 469.177,
subdivisions 1 and 4. In determining the original net tax
capacity the net tax capacity of real property exempt from
taxation at the time of the request shall be zero, except for
real property which is tax exempt by reason of public ownership
by the requesting authority and which has been publicly owned
for less than one year prior to the date of the request for
certification, in which event the net tax capacity of the
property shall be the net tax capacity as most recently
determined by the commissioner of revenue.
(b) The original net tax capacity of any designated
hazardous substance site or hazardous substance subdistrict
shall be determined as of the date the authority certifies to
the county auditor that the authority has entered a
redevelopment or other agreement for the removal actions or
remedial actions specified in a development response action
plan, or otherwise provided funds to finance the development
response action plan. The original net tax capacity equals (i)
the net tax capacity of the parcel or parcels in the site or
subdistrict, as most recently determined by the commissioner of
revenue, less (ii) the estimated costs of the removal actions
and remedial actions as specified in a development response
action plan to be undertaken with respect to the parcel or
parcels, (iii) but not less than zero.
(c) The original net tax capacity of a hazardous substance
site or subdistrict shall be increased by the amount by which it
was reduced pursuant to paragraph (b), clause (ii), upon
certification by the municipality that the cost of the removal
and remedial actions specified in the development response
action plan, except for long-term monitoring and similar
activities, have been paid or reimbursed.
(d) For purposes of this subdivision, "real property" shall
include any property normally taxable as personal property by
reason of its location on or over publicly owned property.
Sec. 5. Minnesota Statutes 1990, section 469.174,
subdivision 10, is amended to read:
Subd. 10. [REDEVELOPMENT DISTRICT.] (a) "Redevelopment
district" means a type of tax increment financing district
consisting of a project, or portions of a project, within which
the authority finds by resolution that one of the following
conditions, reasonably distributed throughout the district,
exists:
(1) parcels consisting of 70 percent of the area of the
district are occupied by buildings, streets, utilities, or other
improvements and more than 50 percent of the buildings, not
including outbuildings, are structurally substandard to a degree
requiring substantial renovation or clearance; or
(2) the property consists of vacant, unused, underused,
inappropriately used, or infrequently used railyards, rail
storage facilities, or excessive or vacated railroad
rights-of-way.
(b) For purposes of this subdivision, "structurally
substandard" shall mean containing defects in structural
elements or a combination of deficiencies in essential utilities
and facilities, light and ventilation, fire protection including
adequate egress, layout and condition of interior partitions, or
similar factors, which defects or deficiencies are of sufficient
total significance to justify substantial renovation or
clearance.
A building is not structurally substandard if it is in
compliance with the building code applicable to new buildings or
could be modified to satisfy the building code at a cost of less
than 15 percent of the cost of constructing a new structure of
the same square footage and type on the site. The municipality
may find that a building is not disqualified as structurally
substandard under the preceding sentence on the basis of
reasonably available evidence, such as the size, type, and age
of the building, the average cost of plumbing, electrical, or
structural repairs, or other similar reliable evidence. If the
evidence supports a reasonable conclusion that the building is
not disqualified as structurally substandard, the municipality
may make such a determination without an interior inspection or
an independent, expert appraisal of the cost of repair and
rehabilitation of the building.
A parcel is deemed to be occupied by a structurally
substandard building for purposes of the finding under paragraph
(a) if all of the following conditions are met:
(1) the parcel was occupied by a substandard building
within three years of the filing of the request for
certification of the parcel as part of the district with the
county auditor;
(2) the substandard building was demolished or removed by
the authority or the demolition or removal was financed by the
authority or was done by a developer under a development
agreement with the authority;
(3) the authority found by resolution before the demolition
or removal that the parcel was occupied by a structurally
substandard building and that after demolition and clearance the
authority intended to include the parcel within a district; and
(4) upon filing the request for certification of the tax
capacity of the parcel as part of a district, the authority
notifies the county auditor that the original tax capacity of
the parcel must be adjusted as provided by section 469.177,
subdivision 1, paragraph (h).
(c) For purposes of this subdivision, a parcel is not
occupied by buildings, streets, utilities, or other improvements
unless 15 percent of the area of the parcel contains
improvements.
(d) For districts consisting of two or more noncontiguous
areas, each area must qualify as a redevelopment district under
paragraph (a), clauses (1) to (3), to be included in the
district, and the entire area of the district must satisfy
paragraph (a).
Sec. 6. Minnesota Statutes 1990, section 469.176,
subdivision 1, is amended to read:
Subdivision 1. [DURATION OF TAX INCREMENT FINANCING
DISTRICTS.] (a) Subject to the limitations contained in
paragraphs (b) to (g), any tax increment financing district as
to which bonds are outstanding, payment for which the tax
increment and other revenues have been pledged, shall remain in
existence at least as long as the bonds continue to be
outstanding. The municipality may, at the time of approval of
the initial tax increment financing plan, provide for a shorter
maximum duration limit than specified in paragraphs (b) to (g).
The specified limit applies in place of the otherwise applicable
limit.
(b) The tax increment pledged to the payment of the bonds
and interest thereon may be discharged and the tax increment
financing district may be terminated if sufficient funds have
been irrevocably deposited in the debt service fund or other
escrow account held in trust for all outstanding bonds to
provide for the payment of the bonds at maturity or date of
redemption and interest thereon to the maturity or redemption
date.
(c) For bonds issued pursuant to section 469.178,
subdivisions 2 and 3, the full faith and credit and any taxing
powers of the municipality or authority shall continue to be
pledged to the payment of the bonds until the principal of and
interest on the bonds has been paid in full.
(d) No tax increment shall be paid to an authority for a
tax increment financing district after three years from the date
of certification of the original net tax capacity of the taxable
real property in the district by the county auditor or after
August 1, 1982, for tax increment financing districts authorized
prior to August 1, 1979, unless within the three-year period (1)
bonds have been issued in aid of the project containing the
district pursuant to section 469.178, or in aid of a project
pursuant to any other law, except revenue bonds issued pursuant
to sections 469.152 to 469.165, prior to August 1, 1979, or (2)
the authority has acquired property within the district, or (3)
the authority has constructed or caused to be constructed public
improvements within the district.
(e) No tax increment shall in any event be paid to the
authority (1) after 25 years from date of receipt by the
authority of the first tax increment for a mined underground
space development district, redevelopment district, or housing
district, (2) after 15 years after receipt by the authority of
the first increment for a renewal and renovation district, (3)
after 12 years from approval of the tax increment financing plan
for a soils condition district, and (4) after eight years from
the date of the receipt, or ten years from approval of the tax
increment financing plan, whichever is less, for an economic
development district.
For tax increment financing districts created prior to
August 1, 1979, no tax increment shall be paid to the authority
after April 1, 2001, or the term of a nondefeased bond or
obligation outstanding on April 1, 1990, secured by increments
from the district or project area, whichever time is greater,
provided that in no case will a tax increment be paid to an
authority after August 1, 2009, from such a district. If a
district's termination date is extended beyond April 1, 2001,
because bonds were outstanding on April 1, 1990, with maturities
extending beyond April 1, 2001, the following restrictions
apply. No increment collected from the district may be expended
after April 1, 2001, except to pay or defease (i) bonds issued
before April 1, 1990, or (ii) bonds issued to refund the
principal of the outstanding bonds and pay associated issuance
costs, provided the average maturity of the refunding bonds does
not exceed the bonds refunded.
(f) Modification of a tax increment financing plan pursuant
to section 469.175, subdivision 4, shall not extend the
durational limitations of this subdivision.
(g) If a parcel of a district is part of a designated
hazardous substance site or a hazardous substance subdistrict,
tax increment may be paid to the authority from the parcel for
longer than the period otherwise provided by this subdivision.
The extended period for collection of tax increment begins on
the date of receipt of the first tax increment from the parcel
that is more than any tax increment received from the parcel
before the date of the certification under section 469.175
469.174, subdivision 7, paragraph (b), and received after the
date of certification to the county auditor described in section
469.175 469.174, subdivision 7, paragraph (b). The extended
period for collection of tax increment is the lesser of: (1) 25
years from the date of commencement of the extended period; or
(2) the period necessary to recover the costs of removal actions
or remedial actions specified in a development response action
plan.
(h) If a parcel located in the district has delinquent
property taxes when the district terminates under the duration
limits under this subdivision, the payment of the parcel's
delinquent taxes made after decertification of the district are
tax increments to the extent the nonpayment of property taxes
caused the outstanding bonds or contractual obligations pledged
to be paid by the district to be paid by sources other than tax
increments or to go unpaid. The county auditor shall pay the
appropriate amount to the district. The authority shall provide
the county auditor with information regarding the payment of
outstanding bonds or contractual obligations and any other
information necessary to administer the payment, as requested by
the county auditor.
Sec. 7. Minnesota Statutes 1990, section 469.1763,
subdivision 1, is amended to read:
Subdivision 1. [DEFINITIONS.] (a) For purposes of this
section, the following terms have the meanings given.
(b) "Activities" means acquisition of property, clearing of
land, site preparation, soils correction, removal of hazardous
waste or pollution, installation of utilities, construction of
public or private improvements, and other similar activities,
but only to the extent that tax increment revenues may be spent
for such purposes under other law. Activities do not include
allocated administrative expenses, but do include engineering,
architectural, and similar costs of the improvements in the
district.
(c) "Third party" means an entity other than (1) the person
receiving the benefit of assistance financed with tax
increments, or (2) the municipality or the development authority
or other person substantially under the control of the
municipality.
Sec. 8. Minnesota Statutes 1990, section 469.1763,
subdivision 2, is amended to read:
Subd. 2. [EXPENDITURES OUTSIDE DISTRICT.] (a) For each tax
increment financing district, an amount equal to at least 75
percent of the revenue derived from tax increments paid by
properties in the district must be expended on activities in the
district or to pay bonds, to the extent that the proceeds of the
bonds were used to finance activities in the district or to pay,
or secure payment of, debt service on credit enhanced bonds.
Not more than 25 percent of the revenue derived from tax
increments paid by properties in the district may be expended,
through a development fund or otherwise, on activities outside
of the district but within the defined geographic area of the
project except to pay, or secure payment of, debt service on
credit enhanced bonds. The revenue derived from tax increments
for the district that are expended on costs under section
469.176, subdivision 4h, paragraph (b), may be deducted first
before calculating the percentages that must be expended within
and without the district.
(b) In the case of a housing district, a housing project,
as defined in section 469.174, subdivision 11, is an activity in
the district.
(c) All administrative expenses are for activities outside
of the district.
Sec. 9. Minnesota Statutes 1990, section 469.1763,
subdivision 3, is amended to read:
Subd. 3. [FIVE-YEAR RULE.] (a) Revenues derived from tax
increments are considered to have been expended on an activity
within the district under subdivision 2 only if one of the
following occurs:
(1) before or within five years after certification of the
district, the revenues are actually paid to a third party with
respect to the activity;
(2) bonds, the proceeds of which must be used to finance
the activity, are issued and sold to a third party before or
within five years after certification and, the revenues are
spent to repay the bonds, and the proceeds of the bonds either
are, on the date of issuance, reasonably expected to be spent
before the end of the later of (i) the five-year period, or (ii)
a reasonable temporary period within the meaning of the use of
that term under section 148(c)(1) of the Internal Revenue Code,
or are deposited in a reasonably required reserve or replacement
fund;
(3) binding contracts with a third party are entered into
for performance of the activity before or within five years
after certification of the district and the revenues are spent
under the contractual obligation; or
(4) costs with respect to the activity are paid before or
within five years after certification of the district and the
revenues are spent to reimburse a party for payment of the
costs, including interest on unreimbursed costs.
(b) For purposes of this subdivision, bonds include
subsequent refunding bonds if one of two tests is met: (1) the
proceeds of the original refunded bonds were spent on activities
within five years after the district was certified or (2) the
original refunded bonds are issued within five years after the
district was certified and the proceeds are expended on
activities within a reasonable temporary period within the
meaning of the use of that term under section 148(c)(1) of the
Internal Revenue Code meet the requirements of paragraph (a),
clause (2).
Sec. 10. Minnesota Statutes 1990, section 469.1763,
subdivision 4, is amended to read:
Subd. 4. [USE OF REVENUES FOR DECERTIFICATION.] (a)
Beginning with the sixth year following certification of the
district, 75 percent of the revenues derived from tax increments
paid by properties in the district that remain after the
expenditures permitted under subdivision 3 must be used only to
pay:
(1) outstanding bonds, as defined in subdivision 3,
paragraphs (a), clause (2), and (b) or;
(2) contracts, as defined in subdivision 3, paragraph (a),
clauses (3) and (4); or
(3) credit enhanced bonds to which the revenues derived
from tax increments are pledged, but only to the extent that
revenues of the district for which the credit enhanced bonds
were issued are insufficient to pay the bonds and to the extent
that the increments from the unrestricted 25 percent share are
insufficient.
(b) When the outstanding bonds have been defeased and when
sufficient money has been set aside to pay contractual
obligations as defined in subdivision 3, paragraph (a), clauses
(3) and (4), the district must be decertified and the pledge of
tax increment discharged.
Sec. 11. Minnesota Statutes 1990, section 469.1763, is
amended by adding a subdivision to read:
Subd. 5. [CREDIT ENHANCED BONDS.] Except as otherwise
provided in this section, revenues derived from tax increments
may be used to pay debt service on credit enhanced bonds issued
to finance activities outside of the district from which the
revenues are derived, regardless of when the district is
created. For purposes of this subdivision, "district" includes
a district or a project area for which certification to collect
increments was requested before August 1, 1979.
Sec. 12. Minnesota Statutes 1990, section 469.177,
subdivision 1, is amended to read:
Subdivision 1. [ORIGINAL NET TAX CAPACITY.] (a) Upon or
after adoption of a tax increment financing plan, the auditor of
any county in which the district is situated shall, upon request
of the authority, certify the original net tax capacity of the
tax increment financing district as described in the tax
increment financing plan and shall certify in each year
thereafter the amount by which the original net tax capacity has
increased or decreased as a result of a change in tax exempt
status of property within the district, reduction or enlargement
of the district or changes pursuant to subdivision 4.
(b) In the case of a mined underground space development
district the county auditor shall certify the original net tax
capacity as zero, plus the net tax capacity, if any, previously
assigned to any subsurface area included in the mined
underground space development district pursuant to section
272.04.
(c) For districts approved under section 469.175,
subdivision 3, or parcels added to existing districts after May
1, 1988, if the classification under section 273.13 of property
located in a district changes to a classification that has a
different assessment ratio, the original net tax capacity of
that property must be redetermined at the time when its use is
changed as if the property had originally been classified in the
same class in which it is classified after its use is changed.
(d) The amount to be added to the original net tax capacity
of the district as a result of previously tax exempt real
property within the district becoming taxable shall be equal to
equals the net tax capacity of the real property as most
recently assessed pursuant to section 273.18 or, if that
assessment was made more than one year prior to the date of
title transfer rendering the property taxable, the net tax
capacity assessed by the assessor at the time of the
transfer. If substantial taxable improvements were made to a
parcel after certification of the district and if the property
later becomes tax exempt, in whole or part, as a result of the
authority acquiring the property through foreclosure or exercise
of remedies under a lease or other revenue agreement, the amount
to be added to the original net tax capacity of the district as
a result of the property again becoming taxable is the amount of
the parcel's value that was included in original net tax
capacity when the parcel was first certified. The amount to be
added to the original net tax capacity of the district as a
result of enlargements thereof shall be equal to equals the net
tax capacity of the added real property as most recently
certified by the commissioner of revenue as of the date of
modification of the tax increment financing plan pursuant to
section 469.175, subdivision 4.
(e) For districts approved under section 469.175,
subdivision 3, or parcels added to existing districts after May
1, 1988, if the net tax capacity of a property increases because
the property no longer qualifies under the Minnesota
agricultural property tax law, section 273.111; the Minnesota
open space property tax law, section 273.112; or the
metropolitan agricultural preserves act, chapter 473H, or
because platted, unimproved property is improved or three years
pass after approval of the plat under section 273.11,
subdivision 1, the increase in net tax capacity must be added to
the original net tax capacity.
(f) Each year the auditor shall also add to the original
net tax capacity of each economic development district an amount
equal to the original net tax capacity for the preceding year
multiplied by the average percentage increase in the net tax
capacity market value of all property included in the economic
development district during the five years prior to
certification of the district.
(g) The amount to be subtracted from the original net tax
capacity of the district as a result of previously taxable real
property within the district becoming tax exempt, or a reduction
in the geographic area of the district, shall be the amount of
original net tax capacity initially attributed to the property
becoming tax exempt or being removed from the district. If the
net tax capacity of property located within the tax increment
financing district is reduced by reason of a court-ordered
abatement, stipulation agreement, voluntary abatement made by
the assessor or auditor or by order of the commissioner of
revenue, the reduction shall be applied to the original net tax
capacity of the district when the property upon which the
abatement is made has not been improved since the date of
certification of the district and to the captured net tax
capacity of the district in each year thereafter when the
abatement relates to improvements made after the date of
certification. The county auditor may specify reasonable form
and content of the request for certification of the authority
and any modification thereof pursuant to section 469.175,
subdivision 4.
(h) If a parcel of property contained a substandard
building that was demolished or removed and if the authority
elects to treat the parcel as occupied by a substandard building
under section 469.174, subdivision 10, paragraph (b), the
auditor shall certify the original net tax capacity of the
parcel using the greater of (1) the current net tax capacity of
the parcel, or (2) the estimated market value of the parcel for
the year in which the building was demolished or removed, but
applying the class rates for the current year.
Sec. 13. Minnesota Statutes 1990, section 469.177,
subdivision 8, is amended to read:
Subd. 8. [ASSESSMENT AGREEMENTS.] An authority may enter
into a written assessment agreement in recordable form with a
developer or redeveloper of property within the tax increment
financing district which establishes any person establishing a
minimum market value of the land and completed, existing
improvements, or improvements to be constructed thereon until a
specified termination date, which date shall be not later than
the date upon which tax increment will no longer be remitted to
the authority pursuant to section 469.176, subdivision 1 in a
district, if the property is owned or will be owned by the
person. The minimum market value established by an assessment
agreement may be fixed, or increase or decrease in later years
from the initial minimum market value. An assessment agreement
terminates on the earliest of the date on which conditions in
the assessment agreement for termination are satisfied, the
termination date specified in the agreement, or the date when
tax increment is no longer paid to the authority under section
469.176, subdivision 1. The assessment agreement shall be
presented to the county assessor, or city assessor having the
powers of the county assessor, of the jurisdiction in which the
tax increment financing district and the property that is the
subject of the agreement is located. The assessor shall review
the plans and specifications for the improvements to be
constructed, review the market value previously assigned to the
land upon which the improvements are to be constructed and, so
long as the minimum market value contained in the assessment
agreement appears, in the judgment of the assessor, to be a
reasonable estimate, shall execute the following certification
upon the agreement:
The undersigned assessor, being legally responsible
for the assessment of the above described property
upon completion of the improvements to be
constructed thereon, hereby certifies that the market
value values assigned to the land and improvements
upon completion shall not be less than $...........
are reasonable.
Upon transfer of title of the land to be developed or
redeveloped from the authority to the developer or redeveloper,
The assessment agreement, together with a copy of this
subdivision, shall be filed for record and recorded in the
office of the county recorder or filed in the office of the
registrar of titles of the each county where the real estate or
any part thereof is situated. Upon completion of the
improvements by the developer or redeveloper, The assessor shall
value the property pursuant to under section 273.11, except that
the market value assigned thereto shall not be less than the
minimum market value contained in established by the assessment
agreement. Nothing herein shall limit the discretion of The
assessor to may assign a market value to the property in excess
of the minimum market value contained in established by the
assessment agreement nor prohibit. The developer or redeveloper
from seeking owner of the property may seek, through the
exercise of administrative and legal remedies, a reduction in
market value for property tax purposes; provided, however, that
the developer or redeveloper shall not seek, nor shall the, but
no city assessor, the county assessor, the county auditor, any
board of review, any board of equalization, the commissioner of
revenue, or any court of this state shall grant a reduction of
the market value below the minimum market value contained in
established by the assessment agreement during the term of the
agreement filed of record regardless of actual market values
which may result from incomplete construction of improvements,
destruction, or diminution by any cause, insured or uninsured,
except in the case of acquisition or reacquisition of the
property by a public entity. Recording or filing of an
assessment agreement complying with the terms of this
subdivision shall constitute constitutes notice of the agreement
to any subsequent purchaser or encumbrancer of the land or any
part thereof, whether voluntary or involuntary anyone who
acquires any interest in the land or improvements that is
subject to the assessment agreement, and shall be the agreement
is binding upon them.
Sec. 14. Minnesota Statutes 1990, section 469.1771,
subdivision 2, is amended to read:
Subd. 2. [COLLECTION OF INCREMENT.] If an authority
includes or retains a parcel of property in a tax increment
financing district that does not qualify for inclusion or
retention within the district, the authority must pay to the
county auditor an amount of money equal to the increment
collected from the property for the year or years. The property
must be eliminated from the original and captured tax capacity
of the district effective for the current property tax
assessment year. This subdivision does not apply to a failure
to decertify a district required by at the end of the duration
limits under section 469.176, subdivision 1 limit specified in
the tax increment financing plan.
Sec. 15. Minnesota Statutes 1990, section 469.1771,
subdivision 4, is amended to read:
Subd. 4. [LIMITATIONS.] (a) If the increments are pledged
to repay bonds that were issued before the lawsuit was filed
under this section, the damages under this section may not
exceed the greatest greater of (1) the damages under subdivision
2 or 3, (2) ten percent of the expenditures or revenues derived
from increment, or (3) (2) the amount of available revenues
after paying debt services due on the bonds.
(b) The court may abate all or part of the amount if it
determines the action was taken in good faith and would work an
undue hardship on the municipality.
Sec. 16. Minnesota Statutes 1990, section 469.179, is
amended by adding a subdivision to read:
Subd. 3. [ACT AMENDMENTS; EFFECTIVE DATE PRESUMPTIONS.] (a)
This subdivision establishes presumptions as to the effective
dates of acts amending sections 469.174 to 469.178. These rules
supplement the rules under section 645.02. The rules in
paragraphs (b) and (c) apply unless the act specifies a
different intent as to the time of its application.
(b) If the act is effective on a date either specified by
the act itself or under section 645.02, the act is effective for
districts for which requests for certification are made after
the specified date.
(c) If the act is effective for districts for which
requests for certification are made after a specified date
either under paragraph (b) or the terms of the act, the
following rules apply:
(1) in the case of a district where the first request for
certification is made after the specified date, the act applies
in full and to the entire area of the district; and
(2) in the case of a district where the first request for
certification was made on or before the specified date, the act
applies only to the area of the district added by tax increment
financing plan amendments for which certification is requested
after the specified date.
Sec. 17. Minnesota Statutes 1990, section 469.1831,
subdivision 4, is amended to read:
Subd. 4. [PROGRAM MONEY; DISTRIBUTION AND RESTRICTIONS.]
(a) Neighborhood revitalization program money may only be
expended in accordance with the program for a purpose listed in
subdivision 3 or this subdivision. Program money may not be
used in those project areas of the city where the city
determines that private investment is occurring will be
sufficient to provide for development and redevelopment of the
project area without public sector assistance, except in cases
where program money is being used to remove or rehabilitate
structurally substandard or obsolete buildings. Revenues
derived from tax increments may only be expended for the
purposes otherwise permitted by law, except that notwithstanding
any law to the contrary, the city must pay at least the
following amount of program money, including revenues derived
from tax increments: (1) 15 percent to the school district, (2)
7.5 percent to the county, and (3) 7.5 percent for social
services. Payment must be made to the county and school
district within 15 days after the city receives the distribution
of increment revenues, provided that the payment for calendar
year 1990 may be made at any time during the year. Payment to
the county for social services delivery shall be paid only after
approval of program and spending plans under paragraph (b).
Payment to the school district for education programs and
services shall be paid only after approval of program and
spending plans under paragraph (b).
(b) The money distributed to the county in a calendar year
must be deducted from the county's levy limit for the following
calendar year. In calculating the county's levy limit base for
later years, the amount deducted must be treated as a local
government aid payment.
The city must notify the commissioner of education of the
amount of the payment made to the school district for the year.
The commissioner shall deduct from the school district's state
education aid payments one-half of the amount received by the
school district.
The program money paid to the school district must be
expended for additional education programs and services in
accordance with the program. The amounts expended by the school
district may not replace existing services.
The money for social services must be paid to the county
for the cost of the provision of social services under the plan,
as approved by the policy board and the county board.
(c) The city must expend on housing programs and related
purposes as provided by the program at least 75 percent of the
program money, after deducting the payments to the school
district and county.
(d) Notwithstanding any other provisions of law to the
contrary, for a city of the first class qualifying under section
469.1781, paragraph (a), program money may be expended anywhere
within the city by the authority for a purpose permitted by this
section for any political subdivision.
Sec. 18. Laws 1989, First Special Session chapter 1,
article 14, section 16, is amended to read:
Sec. 16. [MOORHEAD TAX INCREMENT FINANCING.]
In the case of a tax increment financing district in the
city of Moorhead created prior to August 1, 1979, and used to
finance a hotel, parking facility, and conference project, the
date "April 1, 1992 1994" must be substituted for "April 1,
1990" in Minnesota Statutes, section 469.176, subdivision 1,
paragraph (e), each place it occurs.
Sec. 19. [FERGUS FALLS TAX INCREMENT FINANCING.]
Notwithstanding the provisions of Minnesota Statutes,
section 469.177, subdivision 1, to the contrary, the net tax
capacity of a tax increment financing district in the city of
Fergus Falls shall be increased as a result of tax exempt
property becoming taxable only by the tax capacity of the parcel
at the time of its certification as part of the district, if:
(1) the property was acquired for private development;
(2) development of the property was substantially completed
by April 1, 1991; and
(3) the property became taxable no later than 15 months
after substantial completion of the development.
To determine the tax capacity at the time of certification,
the county auditor shall use the market value assigned under
Minnesota Statutes, section 273.18, and the class rates in
effect at the time the property is added to the district's
original net tax capacity.
Sec. 20. Laws 1990, chapter 604, article 7, section 29,
subdivision 1, is amended to read:
Subdivision 1. [EXPENDITURE.] The city of Minneapolis and
the Minneapolis community development agency shall reserve
$10,000,000 in 1990 and $20,000,000 each year from 1991 to 2009
from tax increment and other revenues generated from the
Minneapolis community development agency common project, adopted
December 30, 1989, to be expended in neighborhood revitalization
anywhere within the city of Minneapolis by the Minneapolis
community development agency for any purpose permitted by
Minnesota Statutes, section 469.1831, for any political
subdivision, except that at least 52.5 percent of the money must
be expended on housing programs and related purposes. None of
these revenues shall be expended in 1990.
Sec. 21. Laws 1990, chapter 604, article 7, section 30,
subdivision 7, is amended to read:
Subd. 7. [COOK COUNTY.] Section 21 does not apply to an
authority in Cook county for tax increment financing districts
established in a project created by law prior to April 30, 1990,
if the request for certification is filed by May 1, 1992 1994.
Sec. 22. [DURATION OF DISTRICT.]
Notwithstanding the provisions of Minnesota Statutes,
section 469.176, subdivision 1, paragraph (e), the duration of
Dawson tax increment financing district number four may be
extended by the authority for up to ten years from the enactment
of this section. The duration of tax increment financing
district number four may not exceed eight years after the
receipt of the first tax increment. The authority may waive
receipt of the tax increment for any year.
Sec. 23. [EFFECTIVE DATE.]
Sections 1, 2, 11, and 16 are effective the day following
final enactment. Section 3 is effective for interest reduction
assistance authorized after July 1, 1991. Sections 5 and 12,
paragraph (h), are effective for improvements demolished or
removed after April 1, 1991. Section 6, paragraph (h), is
effective for delinquent property taxes paid after April 1,
1991. Section 6, paragraph (d), is effective for districts for
which certification is requested after June 30, 1991. Sections
4, 6, paragraph (g), 7, 8, 9, and 10 are effective for districts
for which certification was requested after April 30, 1990.
Sections 12, except paragraph (h), and 13 are effective the day
following final enactment and apply to all tax increment
financing districts regardless of when certification was
requested. Sections 14 and 15 are effective for violations
occurring after December 31, 1990. Section 18 is effective the
day after compliance with Minnesota Statutes, section 645.021,
by the governing body of the city of Moorhead. Section 19 is
effective the day after compliance with Minnesota Statutes,
section 645.021, by the governing body of the city of Fergus
Falls. Sections 20, 21, and 22 each are effective the day after
compliance with Minnesota Statutes, section 645.021, by the
governing bodies of the city of Minneapolis, Cook county, and
the city of Dawson respectively.
ARTICLE 11
MINING TAXES
Section 1. Minnesota Statutes 1990, section 289A.01, is
amended to read:
289A.01 [APPLICATION OF CHAPTER.]
This chapter applies to taxes administered by or paid to
the commissioner under chapters 290, 290A, 291, and 297A, and
sections 298.01 and 298.015.
Sec. 2. Minnesota Statutes 1990, section 289A.02, is
amended by adding a subdivision to read:
Subd. 6. [MINING COMPANY.] "Mining company" means a person
engaged in the business of mining or producing ores in Minnesota
subject to the taxes imposed by section 298.01 or 298.015.
Sec. 3. Minnesota Statutes 1990, section 289A.08, is
amended by adding a subdivision to read:
Subd. 15. [MINING COMPANIES.] A mining company must file
an annual return signed by a person designated by the mining
company.
Sec. 4. Minnesota Statutes 1990, section 289A.18,
subdivision 1, is amended to read:
Subdivision 1. [INDIVIDUAL INCOME, FIDUCIARY INCOME,
CORPORATE FRANCHISE, AND ENTERTAINMENT TAXES; PARTNERSHIP AND S
CORPORATION RETURNS; INFORMATION RETURNS; MINING COMPANY
RETURNS.] The returns required to be made under sections 289A.08
and 289A.12 must be filed at the following times:
(1) returns made on the basis of the calendar year must be
filed on April 15 following the close of the calendar year,
except that returns of corporations must be filed on March 15
following the close of the calendar year;
(2) returns made on the basis of the fiscal year must be
filed on the 15th day of the fourth month following the close of
the fiscal year, except that returns of corporations must be
filed on the 15th day of the third month following the close of
the fiscal year;
(3) returns for a fractional part of a year must be filed
on the 15th day of the fourth month following the end of the
month in which falls the last day of the period for which the
return is made, except that the returns of corporations must be
filed on the 15th day of the third month following the end of
the month in which falls the last day of the period for which
the return is made;
(4) in the case of a final return of a decedent for a
fractional part of a year, the return must be filed on the 15th
day of the fourth month following the close of the 12-month
period that began with the first day of that fractional part of
a year;
(5) in the case of the return of a cooperative association,
returns must be filed on or before the 15th day of the ninth
month following the close of the taxable year;
(6) if a corporation has been divested from a unitary group
and files a return for a fractional part of a year in which it
was a member of a unitary business that files a combined report
under section 290.34, subdivision 2, the divested corporation's
return must be filed on the 15th day of the third month
following the close of the common accounting period that
includes the fractional year; and
(7) returns of entertainment entities must be filed on
April 15 following the close of the calendar year; and
(8) returns of mining companies must be filed on May 1
following the close of the calendar year.
Sec. 5. Minnesota Statutes 1990, section 289A.19,
subdivision 2, is amended to read:
Subd. 2. [CORPORATE FRANCHISE AND MINING COMPANY TAXES.]
The commissioner may grant an extension of up to seven months
for filing the return of a corporation subject to tax under
chapter 290 or a mining company if:
(1) the corporation or mining company files a tentative
return when the regularly required return is due;
(2) the corporation or mining company pays the tax on the
basis of the tentative return and the amount of tax, determined
without regard to any prepayment of tax, shown on the tentative
return, or the amount of tax paid on or before the regular due
date of the return, is at least 90 percent of the amount shown
on the corporation's or mining company's regularly required
return;
(3) the balance due shown on the regularly required return
is paid on or before the extended due date of the return; and
(4) interest on any balance due is paid at the rate
specified in section 270.75 from the regular due date of the
return until the tax is paid.
Sec. 6. Minnesota Statutes 1990, section 289A.20,
subdivision 1, is amended to read:
Subdivision 1. [INDIVIDUAL INCOME, FIDUCIARY INCOME,
MINING COMPANY, CORPORATE FRANCHISE, AND ENTERTAINMENT TAXES.]
(a) Individual income, fiduciary, mining company, and corporate
franchise taxes must be paid to the commissioner on or before
the date the return must be filed under section 289A.18,
subdivision 1, or the extended due date as provided in section
289A.19, unless an earlier date for payment is provided.
Notwithstanding any other law, a taxpayer whose unpaid
liability for income or corporate franchise taxes, as reflected
upon the return, is $1 or less need not pay the tax.
(b) Entertainment taxes must be paid on or before the date
the return must be filed under section 289A.18, subdivision 1.
Sec. 7. Minnesota Statutes 1990, section 289A.31,
subdivision 1, is amended to read:
Subdivision 1. [INDIVIDUAL INCOME, FIDUCIARY INCOME,
MINING COMPANY, CORPORATE FRANCHISE, AND ENTERTAINMENT TAXES.]
(a) Individual income, fiduciary income, mining company, and
corporate franchise taxes, and interest and penalties, must be
paid by the taxpayer upon whom the tax is imposed, except in the
following cases:
(1) The tax due from a decedent for that part of the
taxable year in which the decedent died during which the
decedent was alive and the taxes, interest, and penalty due for
the prior years must be paid by the decedent's personal
representative, if any. If there is no personal representative,
the taxes, interest, and penalty must be paid by the
transferees, as defined in section 289A.38, subdivision 13, to
the extent they receive property from the decedent;
(2) The tax due from an infant or other incompetent person
must be paid by the person's guardian or other person authorized
or permitted by law to act for the person;
(3) The tax due from the estate of a decedent must be paid
by the estate's personal representative;
(4) The tax due from a trust, including those within the
definition of a corporation, as defined in section 290.01,
subdivision 4, must be paid by a trustee; and
(5) The tax due from a taxpayer whose business or property
is in charge of a receiver, trustee in bankruptcy, assignee, or
other conservator, must be paid by the person in charge of the
business or property so far as the tax is due to the income from
the business or property.
(b) Entertainment taxes are the joint and several liability
of the entertainer and the entertainment entity. The payor is
liable to the state for the payment of the tax required to be
deducted and withheld under section 290.9201, subdivision 7, and
is not liable to the entertainer for the amount of the payment.
Sec. 8. Minnesota Statutes 1990, section 289A.35, is
amended to read:
289A.35 [ASSESSMENTS.]
The commissioner shall make determinations, corrections,
and assessments with respect to state taxes, including interest,
additions to taxes, and assessable penalties. The commissioner
may audit and adjust the taxpayer's computation of federal
taxable income to make it conform with the provisions of section
290.01, subdivisions 19 to 19g, or the, items of federal tax
preferences, or federal credit amounts to make them conform with
the provisions of chapter 290 or section 298.01. If a taxpayer
fails to file a required return, the commissioner, from
information in the commissioner's possession or obtainable by
the commissioner, may make a return for the taxpayer. The
return will be prima facie correct and valid. If a return has
been filed, the commissioner shall examine the return and make
any audit or investigation that is considered necessary. The
commissioner may use statistical or other sampling techniques
consistent with generally accepted accounting principles in
examining returns or records and making assessments.
Sec. 9. Minnesota Statutes 1990, section 289A.38,
subdivision 12, is amended to read:
Subd. 12. [REQUEST FOR EARLY AUDIT FOR INDIVIDUAL INCOME,
FIDUCIARY INCOME, MINING COMPANY, AND CORPORATE FRANCHISE
TAXES.] (a) Tax must be assessed within 18 months after written
request for an assessment has been made in the case of income
received (1) during the lifetime of a decedent, (2) by the
decedent's estate during the period of administration, (3) by a
trustee of a terminating trust or other fiduciary who, because
of custody of assets, would be liable for the payment of tax
under section 289A.31, subdivision 4, or (4) by a mining company
or a corporation. A proceeding in court for the collection of
the tax must begin within two years after written request for
the assessment (filed after the return is made and in the form
the commissioner prescribes) by the personal representative or
other fiduciary representing the estate of the decedent, or by
the trustee of a terminating trust or other fiduciary who,
because of custody of assets, would be liable for the payment of
tax under section 289A.31, subdivision 4, or by the
corporation. Except as provided in section 289A.42, subdivision
1, an assessment must not be made after the expiration of 3-1/2
years after the return was filed, and an action must not be
brought after the expiration of four years after the return was
filed.
(b) Paragraph (a) only applies in the case of a mining
company or a corporation if:
(1) the written request notifies the commissioner that the
corporation contemplates dissolution at or before the expiration
of the 18-month period;
(2) the dissolution is begun in good faith before the
expiration of the 18-month period; and
(3) the dissolution is completed within the 18-month period.
Sec. 10. Minnesota Statutes 1990, section 289A.56,
subdivision 2, is amended to read:
Subd. 2. [CORPORATE FRANCHISE, MINING COMPANY, INDIVIDUAL
AND FIDUCIARY INCOME, AND ENTERTAINER TAX OVERPAYMENTS.]
Interest must be paid on an overpayment refunded or credited to
the taxpayer from the date of payment of the tax until the date
the refund is paid or credited. For purposes of this
subdivision, the prepayment of tax made by withholding of tax at
the source or payment of estimated tax before the due date is
considered paid on the last day prescribed by law for the
payment of the tax by the taxpayer. A return filed before the
due date is considered as filed on the due date.
When the amount of tax withheld at the source or paid as
estimated tax or allowable as other refundable credits, or
withheld from compensation of entertainers, exceeds the tax
shown on the original return by $10, the amount refunded bears
interest from 90 days after (1) the due date of the return of
the taxpayer, or (2) the date on which the original return is
filed, whichever is later, until the date the refund is paid to
the taxpayer. Where the amount to be refunded is less than $10,
no interest is paid. However, to the extent that the basis for
the refund is a net operating loss carryback, interest is
computed only from the end of the taxable year in which the loss
occurs.
Sec. 11. Minnesota Statutes 1990, section 289A.60,
subdivision 4, is amended to read:
Subd. 4. [SUBSTANTIAL UNDERSTATEMENT OF LIABILITY;
PENALTY.] The commissioner of revenue shall impose a penalty for
substantial understatement of any tax payable to the
commissioner, except a tax imposed under chapter 297A.
There must be added to the tax an amount equal to 20
percent of the amount of any underpayment attributable to the
understatement. There is a substantial understatement of tax
for the period if the amount of the understatement for the
period exceeds the greater of: (1) ten percent of the tax
required to be shown on the return for the period; or (2)(a)
$10,000 in the case of a mining company or a corporation, other
than an S corporation as defined in section 290.9725, when the
tax is imposed by chapter 290, or (b) $5,000 in the case of any
other taxpayer, and in the case of a mining company or a
corporation any tax not imposed by chapter 290 or section 298.01
or 298.015. The term "understatement" means the excess of the
amount of the tax required to be shown on the return for the
period, over the amount of the tax imposed that is shown on the
return. The amount of the understatement shall be reduced by
that part of the understatement that is attributable to the tax
treatment of any item by the taxpayer if there is or was
substantial authority for the treatment, or any item with
respect to which the relevant facts affecting the item's tax
treatment are adequately disclosed in the return or in a
statement attached to the return. The special rules in cases
involving tax shelters provided in section 6662(d)(2)(C) of the
Internal Revenue Code of 1986, as amended through December 31,
1989, shall apply and shall apply to a tax shelter the principal
purpose of which is the avoidance or evasion of state taxes.
The commissioner may abate all or any part of the addition to
the tax provided by this section on a showing by the taxpayer
that there was reasonable cause for the understatement, or part
of it, and that the taxpayer acted in good faith. The
additional tax and penalty shall bear interest at the rate
specified in section 270.75 from the time the tax should have
been paid until paid.
Sec. 12. Minnesota Statutes 1990, section 298.01,
subdivision 3, is amended to read:
Subd. 3. [OCCUPATION TAX; OTHER ORES.] Every person
engaged in the business of mining or producing ores in this
state, except iron ore or taconite concentrates, shall pay an
occupation tax to the state of Minnesota as provided in this
subdivision. The tax is determined in the same manner as the
tax imposed by section 290.02, except that sections 290.05,
subdivision 1, clause (a), and 290.17, subdivision 4, do not
apply. The tax is in addition to all other taxes and is due and
payable on or before June 15 of the year succeeding the calendar
year covered by the report required by section 298.05.
Sec. 13. Minnesota Statutes 1990, section 298.01, is
amended by adding a subdivision to read:
Subd. 3d. [ALTERNATIVE MINIMUM TAX CREDIT.] A credit is
allowed against qualified regular tax for qualified alternative
minimum tax previously paid. The amount of the credit allowed
under this subdivision is determined under section 290.0921,
subdivision 8. For purposes of calculating this credit, the
following terms have the meanings given:
(a) "Qualified alternative minimum tax" means the amount
determined under subdivision 3 and section 290.0921, subdivision
1.
(b) "Qualified regular tax" means the tax imposed under
subdivision 3 and section 290.06, subdivision 1.
Sec. 14. Minnesota Statutes 1990, section 298.01,
subdivision 4, is amended to read:
Subd. 4. [OCCUPATION TAX; IRON ORE; TACONITE
CONCENTRATES.] A person engaged in the business of mining or
producing of iron ore or taconite concentrates in this state
shall pay an occupation tax to the state of Minnesota. The tax
is determined in the same manner as the tax imposed by section
290.02, except that sections 290.05, subdivision 1, clause (a),
and 290.17, subdivision 4, do not apply. The tax is in addition
to all other taxes and is due and payable on or before June 15
of the year succeeding the calendar year covered by the report
required by section 298.05.
Sec. 15. Minnesota Statutes 1990, section 298.01, is
amended by adding a subdivision to read:
Subd. 4e. [ALTERNATIVE MINIMUM TAX CREDIT.] (a) A credit
is allowed against the tax imposed by subdivision 4 for the
increases in occupation taxes paid in 1988, 1989, and 1990
attributable to the alternative minimum tax imposed under
section 290.092 and Minnesota Statutes 1986, section 298.40.
The amount of the credit allowed under this paragraph is
determined under section 290.06, subdivision 21.
(b) A credit is allowed against qualified regular tax for
qualified alternative minimum tax previously paid. The amount
of the credit allowed under this paragraph is determined under
section 290.0921, subdivision 8. For purposes of calculating
this credit, the following terms have the meanings given:
(1) "Qualified alternative minimum tax" means the amount
determined under subdivision 4d and section 290.0921,
subdivision 1.
(2) "Qualified regular tax" means the tax imposed under
subdivision 4 and section 290.06, subdivision 1.
Sec. 16. Minnesota Statutes 1990, section 298.015,
subdivision 1, is amended to read:
Subdivision 1. [TAX IMPOSED.] A person engaged in the
business of mining shall pay to the state of Minnesota for
distribution as provided in section 298.018 a net proceeds tax
equal to two percent of the net proceeds from mining in
Minnesota. The tax applies to all mineral and energy resources
mined or extracted within the state of Minnesota except for
sand, silica sand, gravel, building stone, crushed rock,
limestone, granite, dimension granite, dimension stone,
horticultural peat, clay, soil, iron ore, and taconite
concentrates. The tax is in addition to all other taxes
provided for by law. The tax is due by June 15 of the year
succeeding the calendar year covered by the report required by
section 298.05.
Sec. 17. Minnesota Statutes 1990, section 298.16, is
amended to read:
298.16 [TAXES TO BE CREDITED TO GENERAL FUND.]
All taxes imposed and collected under the provisions of
sections 298.01 to 298.15 shall and 298.015 must be paid into
the state treasury and credited to the general fund.
Sec. 18. Minnesota Statutes 1990, section 298.21, is
amended to read:
298.21 [PERSON.]
For all purposes of sections 298.01 to 298.16 298.018, the
word "person" shall be construed to include means individuals,
copartnerships fiduciaries, estates, trusts, partnerships,
companies, joint stock companies, corporations, and all
associations, however and for whatever purpose organized.
Sec. 19. Minnesota Statutes 1990, section 298.27, is
amended to read:
298.27 [COLLECTION AND PAYMENT OF TAX.]
The taxes provided by section 298.24 shall be paid directly
to each eligible county and the iron range resources and
rehabilitation board. The commissioner of revenue shall notify
each producer of the amount to be paid each recipient prior to
February 8. Every person subject to taxes imposed by section
298.24 shall file a correct report covering the preceding year.
The report must contain the information required by the
commissioner. The report required by section 298.05 shall be
filed on or before February 1. A remittance equal to 90 percent
of the total tax required to be paid hereunder shall be paid on
or before February 15. On or before February 25, the county
auditor shall make distribution of the payment received by the
county in the manner provided by section 298.28. The balance
due shall be paid on or before April 15 following the production
year, and shall be distributed by the county auditor as provided
in section 298.28 by May 15. Reports shall be made and hearings
held upon the determination of the tax in accordance with
procedures established by the commissioner of revenue. The
commissioner of revenue shall have authority to make reasonable
rules as to the form and manner of filing reports necessary for
the determination of the tax hereunder, and by such rules may
require the production of such information as may be reasonably
necessary or convenient for the determination and apportionment
of the tax. All the provisions of the occupation tax law with
reference to the assessment and determination of the occupation
tax, including all provisions for appeals from or review of the
orders of the commissioner of revenue relative thereto, but not
including provisions for refunds, are applicable to the taxes
imposed by section 298.24 except in so far as inconsistent
herewith. If any person subject to section 298.24 shall fail to
make the report provided for in this section at the time and in
the manner herein provided, the commissioner of revenue shall in
such case, upon information possessed or obtained, ascertain the
kind and amount of ore mined or produced and thereon find and
determine the amount of the tax due from such person. There
shall be added to the amount of tax due a penalty for failure to
report on or before February 1, which penalty shall equal ten
percent of the tax imposed and be treated as a part thereof.
If any person responsible for making a partial tax payment
at the time and in the manner herein provided fails to do so,
there shall be imposed a penalty equal to ten percent of the
amount so due, which penalty shall be treated as part of the tax
due.
In the case of any underpayment of the partial tax payment
required herein, there may be added and be treated as part of
the tax due a penalty equal to ten percent of the amount so
underpaid.
If any portion of the taxes provided for in section 298.24
is not paid before the fifteenth day of April of the year in
which due and payable, a penalty of ten percent of such unpaid
portion shall immediately accrue, and thereafter one percent per
month shall be added to such tax and penalty while such tax
remains unpaid.
Sec. 20. [REPEALER.]
Minnesota Statutes 1990, sections 298.05; 298.06; 298.07;
298.08; 298.09; 298.10; 298.11; 298.12; 298.13; 298.14; 298.15;
298.19; and 298.20 are repealed.
Sec. 21. [EFFECTIVE DATE.]
Sections 1 to 12, 14, and 16 to 20 are effective for ores
mined after December 31, 1990. Sections 13 and 15 are effective
for ores mined after December 31, 1989.
ARTICLE 12
PROPERTY TAX ADMINISTRATIVE AND TECHNICAL
Section 1. Minnesota Statutes 1990, section 18.022,
subdivision 2, is amended to read:
Subd. 2. [COST.] (a) To defray the cost of the activities
under subdivision 1, the governing body of the political
subdivision may levy a tax which, except when levied by a
county, must not exceed a gross local tax rate of .55 percent or
a net local tax rate of .68 0.01596 percent of taxable market
value in any year in excess of charter local tax rate
limitations, but not in any event more than 50 cents per capita,
except that the levy for the grasshopper control program under
sections 18.0223 to 18.0227 is not subject to the 50 cents per
capita limitation. The political subdivision may make the levy,
where necessary, separate from the general levy and at any time
of the year.
(b) If, because of the prevalence of Dutch elm disease, the
governing body of such a political subdivision is unable to
defray the cost of control activities authorized by this section
within the limits set by this subdivision, the limits set by
this subdivision are increased to a gross local tax rate of 1.1
percent or a net local tax rate of 1.36 0.03216 percent of
taxable market value, but not in any event more than one dollar
per capita.
Sec. 2. Minnesota Statutes 1990, section 270.11,
subdivision 6, is amended to read:
Subd. 6. [CHANGE OF NET TAX CAPACITIES MARKET VALUES.] The
commissioner of revenue shall raise or lower the net tax
capacity market value of any real or personal property,
including the power to raise or lower the net tax capacity
market value of the real or personal property of any individual,
copartnership, company, association, or corporation; provided,
that before any such assessment against the property of any
individual, copartnership, company, association, or corporation
is so raised, notice of an intention to raise such net tax
capacity market value and of the time and place at which a
hearing thereon will be held shall be given to such person, by
mail, addressed to the person at the place of residence listed
upon the assessment book, at least five days before the day of
such hearing.
All relevant and material evidence concerning the net tax
capacity market value of the real or personal property shall be
submitted at the hearing, and the hearing shall not be a
"contested case" within the meaning of section 14.02,
subdivision 3. The person notified of the hearing, or any other
person having an interest in the property, may present evidence
and argument bearing upon the net tax capacity market value of
the property.
Sec. 3. Minnesota Statutes 1990, section 270.12, is
amended by adding a subdivision to read:
Subd. 5. [EQUALIZATION ORDERS.] The board of equalization
may, pursuant to its responsibilities under subdivisions 2 and
3, issue orders to ensure that the results of local and county
boards of equalization are consistent with the objective of
state equalization. The board may issue, at its discretion, a
supplemental order to amend, supersede, or correct a prior order
of the board or an order of a local or county board. The
supplemental order must be issued within 60 days of the order to
be changed. The board may issue to a local or county board of
equalization, within ten business days of the receipt of minutes
of a local or county board of equalization, an order explaining
the action that the state board believes will be necessary to
effect the objective of state equalization.
Sec. 4. Minnesota Statutes 1990, section 272.02,
subdivision 4, is amended to read:
Subd. 4. [CONVERSION TO EXEMPT OR TAXABLE USES.] (a) Any
property exempt from taxation on January 2 of any year which,
due to sale or other reason, loses its exemption prior to
December 20 July 1 of any year, shall be placed on the current
assessment rolls for that year.
The valuation shall be determined with respect to its value
on January 2 of such year. The classification shall be based
upon the use to which the property was put by the purchaser, or
in the event the purchaser has not utilized the property by
December 20 July 1, the intended use of the property, determined
by the county assessor, based upon all relevant facts.
(b) Property subject to tax on January 2 that is acquired
by a governmental entity, church, or educational institution
before August July 1 of the year is exempt for that assessment
year if (1) the property is to be used for an exempt purpose
under subdivision 1, clauses (1) to (7), and (2) the property is
not subject to the filing requirement under section 272.025.
Sec. 5. Minnesota Statutes 1990, section 272.025,
subdivision 1, is amended to read:
Subdivision 1. Except as provided in subdivision 3, a
taxpayer claiming an exemption from taxation on property
described in section 272.02, subdivision 1, clauses (1) to (7),
(10), (11), (13), (15), (16), (18), and (20), except churches
and houses of worship and property solely used for educational
purposes by academies, colleges, universities or seminaries of
learning and property owned by the state of Minnesota or any
political subdivision thereof, shall file a statement of
exemption with the assessor of the assessment district in which
the property is located, or,. In the case of a taxpayer
claiming an exemption from taxation on property described in
section 272.02, subdivision 1, clause (9), the taxpayer shall
file a statement of exemption with the commissioner or revenue,
on or before February 15 of each year for which the taxpayer
claims an exemption. In case of sickness, absence or other
disability or for good cause, the assessor may extend the time
for filing the statement of exemption for a period not to exceed
60 days. The commissioner of revenue shall prescribe the form
and contents of the statement of exemption.
Sec. 6. Minnesota Statutes 1990, section 272.31, is
amended to read:
272.31 [LIEN OF REAL ESTATE TAXES.]
The taxes assessed upon real property shall be a perpetual
lien thereon, and on all structures and standing timber thereon
and on all minerals therein, from and including January 2 in the
year in which they are levied, until they are paid; but, the
property is assessed. As between grantor and grantee, such lien
shall not attach until the first Monday of January of the year
next thereafter.
Sec. 7. Minnesota Statutes 1990, section 272.67,
subdivision 6, is amended to read:
Subd. 6. A certified copy of every ordinance, amendment,
and order adopted or entered pursuant to under this section
shall be filed with the county auditor before it becomes
effective. For the purposes of taxation, if the ordinance,
amendment, or order is certified on or before August 1 of a levy
year, it may be implemented that same levy year. If the
ordinance, amendment, or order is certified after August 1 of a
levy year, it may not be implemented until the following levy
year. The amount of taxes levied each year by each city shall
be certified to the county auditor in the manner now or
hereafter provided by law. Taxes levied for payment of bonds
and judgments and interest thereon shall continue to be spread
upon all taxable property within the boundaries of the city in
proportion to the gross net tax capacity thereof. The remaining
amount of the taxes levied each year shall be allocated by the
county auditor to the urban service district and the rural
service district in amounts proportionate to the current benefit
ratio times the current ratio between the market values of all
taxable property within the urban service district and all
taxable property within the rural service district. Within each
district, the amount so allocated shall be spread upon all
taxable property in proportion to the net tax capacity thereof.
Sec. 8. Minnesota Statutes 1990, section 273.111,
subdivision 6, is amended to read:
Subd. 6. Real property shall be considered to be in
agricultural use provided that annually: (1) at least 33 1/3
percent of the total family income of the owner is derived
therefrom, or the total production income including rental from
the property is $300 plus $10 per tillable acre; and (2) it is
devoted to the production for sale of livestock, dairy animals,
dairy products, poultry and poultry products, fur bearing
animals, horticultural and nursery stock which is under sections
18.44 to 18.61, fruit of all kinds, vegetables, forage, grains,
bees and apiary products by the owner, slough, wasteland, and
woodland contiguous to or surrounded by land described in
subdivision 3 shall be considered to be in agricultural use if
under the same ownership and management agricultural products as
defined in section 273.13, subdivision 23, paragraph (e).
Sec. 9. Minnesota Statutes 1990, section 273.124,
subdivision 13, is amended to read:
Subd. 13. [SOCIAL SECURITY NUMBER REQUIRED FOR HOMESTEAD
APPLICATION.] Every property owner applying for homestead
classification must furnish to the county assessor that owner's
social security number. If the social security number is not
provided, the county assessor shall classify the property as
nonhomestead. The social security numbers of the property
owners are private data on individuals as defined by section
13.02, subdivision 12, but, notwithstanding that section, the
private data may be disclosed to the commissioner of revenue.
At the request of the commissioner, each county must give
the commissioner a list that includes the name and social
security number of each property owner applying for homestead
classification.
If, in comparing the lists supplied by the counties, the
commissioner finds that a property owner is claiming more than
one homestead, the commissioner shall notify the appropriate
counties. Within 90 days of the notification, the county
assessor shall investigate to determine if the homestead
classification was properly claimed. If the property owner does
not qualify, the county assessor shall notify the county auditor
who will determine the amount of homestead benefits that had
been improperly allowed. For the purpose of this section,
"homestead benefits" means the tax reduction resulting from the
classification as a homestead under section 273.13, the
homestead credit under section 273.1398 for taxes payable in
1990 and thereafter, the taconite homestead credit under section
273.135, and the supplemental homestead credit, and the tax
reduction resulting from the agricultural credit under section
273.1398 for taxes payable in 1990 and thereafter under section
273.1391. The county auditor shall send a notice to the owners
of the affected property, demanding reimbursement of the
homestead benefits plus a penalty equal to 25 50 percent of the
homestead benefits. The property owners may appeal the county's
determination by filing a notice of appeal with the Minnesota
tax court within 60 days of the date of the notice from the
county.
If the amount of homestead benefits and penalty is not paid
within 60 days, and if no appeal has been filed, the county
auditor shall certify the amount to the succeeding year's tax
list to be collected as part of the property taxes.
Any amount of homestead benefits recovered from the
property owner must be transmitted to the commissioner by the
end of each calendar quarter. Any amount recovered attributable
to taconite homestead credit shall be transmitted to the St.
Louis county auditor to be deposited in the taconite property
tax relief account. The amount of penalty collected must be
deposited in the county general fund.
The commissioner will provide suggested homestead
applications to each county. If a property owner has applied
for more than one homestead and the county assessors cannot
determine which property should be classified as homestead, the
county assessors will refer the information to the commissioner.
The commissioner shall make the determination and notify the
counties within 60 days.
In addition to lists of homestead properties, the
commissioner may ask the counties to furnish lists of all
properties and the record owners.
Sec. 10. Minnesota Statutes 1990, section 273.1398,
subdivision 6, is amended to read:
Subd. 6. [PAYMENT.] The commissioner shall certify the
aids provided in subdivisions 2, 2b, 3, and 5 before December 1,
1989, and October 1 thereafter of the year preceding the
distribution year to the county auditor of the affected local
government and pay them. The aids provided in subdivisions 2,
2b, 3, and 5 must be paid to local governments other than school
districts at the times provided in section 477A.015 for payment
of local government aid to taxing jurisdictions, except that the
first one-half payment of disparity reduction aid provided in
subdivision 3 must be paid on or before August 31. The
disparity reduction credit provided in subdivision 4 must be
paid to taxing jurisdictions other than school districts at the
time provided in section 473H.10, subdivision 3. Aids and
credit reimbursements to school districts must be certified to
the commissioner of education and paid under section 273.1392.
Except for education districts and secondary cooperatives that
receive revenue according to section 124.2721 or 124.575,
payment shall not be made to any taxing jurisdiction that has
ceased to levy a property tax.
Sec. 11. Minnesota Statutes 1990, section 276.041, is
amended to read:
276.041 [FILING TO RECEIVE NOTICE OF DELINQUENT TAXES.]
Fee owners, vendees, mortgagees, lienholders, escrow
agents, and lessees of real property may file their names and
current mailing addresses with the county auditor in the county
where the land is located for the purpose of receiving notices
affecting the land that are issued under sections 276.04,
281.23, and 279.091. A person filing shall pay a filing fee of
$15 to the county auditor for each parcel. The filing expires
after three years. The county auditor shall give a copy of the
list of names and addresses to the county treasurer. Taxpayers
of record with the county auditor and mortgagees who remit taxes
on their behalf shall receive tax statements and other notices
and are not required to file and pay fees under this section.
Sec. 12. Minnesota Statutes 1990, section 277.01, is
amended to read:
277.01 [WHEN TAX IS DELINQUENT; PENALTY.]
Subdivision 1. Except as provided in this subdivision and
subdivision 3, all unpaid personal property taxes shall be
deemed delinquent on May 16 next after they become due or 21
days after the postmark date on the envelope containing the
property tax statement, whichever is later, and thereupon a
penalty of eight percent shall attach and be charged upon all
such taxes. In the case of unpaid personal property taxes due
and owing under section 272.01, subdivision 2, or 273.19, the
first half shall become delinquent if not paid before May 16 or
21 days after the postmark date on the envelope containing the
property tax statement, whichever is later, and thereupon a
penalty of eight percent shall attach on the unpaid first half;
and the second half shall become delinquent if not paid before
October 16, and thereupon a penalty of eight percent shall
attach on the unpaid second half. This section shall not apply
to class 2a property taxed under section 274.19, subdivision 8,
paragraph (c).
A county may provide by resolution that in the case of a
property owner that has multiple personal property tax
statements with the aggregate taxes exceeding $50, payments may
be made in installments as provided in this subdivision.
The county treasurer may accept payments of more or less
than the exact amount of a tax installment due. If the accepted
payment is less than the amount due, payments must be applied
first to the penalty accrued for the year the payment is made.
Acceptance of partial payment of tax does not constitute a
waiver of the minimum payment required as a condition for filing
an appeal under section 277.011 or any other law, nor does it
affect the order of payment of delinquent taxes under section
280.39.
Subd. 3. [IMPROVEMENTS TO REAL PROPERTY.] Personal
property taxes assessed upon improvements made to real property
taxed under section 272.01, subdivision 2, or 273.19, if unpaid,
become delinquent on May 16 or 21 days after the postmark date
on the envelope containing the property tax statement, whichever
is later. If the tax against the improvements exceeds $50,
one-half may be paid before May 16 and the remaining one-half
must be paid at any time before the following October 16,
without penalty. Section 279.01, subdivision 1, otherwise
governs imposition of penalties.
Sec. 13. Minnesota Statutes 1990, section 278.01,
subdivision 1, is amended to read:
Subdivision 1. [DETERMINATION OF VALIDITY.] Any person
having any estate, right, title, or interest in or lien upon any
parcel of land, who claims that such property has been
partially, unfairly, or unequally assessed in comparison with
other property in the (1) city, or (2) county, or (3) in the
case of a county containing a city of the first class, the
portion of the county excluding the first class city, or that
the parcel has been assessed at a valuation greater than its
real or actual value, or that the tax levied against the same is
illegal, in whole or in part, or has been paid, or that the
property is exempt from the tax so levied, may have the validity
of the claim, defense, or objection determined by the district
court of the county in which the tax is levied or by the tax
court by serving two copies one copy of a petition for such
determination upon the county auditor, one copy on the county
attorney, and one copy on the county treasurer, and three copies
on the county assessor. In counties where the office of county
treasurer has been combined with the office of county auditor,
the petitioner must serve the number of copies required by the
county. The petitioner must file the copies with proof of
service, in the office of the court administrator of the
district court before the 16th day of May of the year in which
the tax becomes payable. The county auditor assessor shall
immediately forward one copy of the petition to the appropriate
governmental authority in a home rule charter or statutory city
or town in which the property is located if that city or town
employs its own certified assessor. A copy of the petition
shall also be sent forwarded by the assessor to the school board
of the school district in which the property is located. A
petition for determination under this section may be transferred
by the district court to the tax court. An appeal may also be
taken to the tax court under chapter 271 at any time following
receipt of the valuation notice required by section 273.121 but
prior to May 16 of the year in which the taxes are payable.
Sec. 14. Minnesota Statutes 1990, section 278.05,
subdivision 4, is amended to read:
Subd. 4. [SALES RATIO STUDIES AS EVIDENCE.] The sales
ratio studies published by the department of revenue, or any
part of the studies, or any copy of the studies or records
accumulated to prepare the studies which is prepared by the
commissioner of revenue for use in determining education aids
shall be admissible in evidence as a public record without the
laying of a foundation if the sales prices used in the study are
adjusted for the terms of the sale to reflect market value and
are adjusted to reflect the difference in the date of sale
compared to the assessment date. The department of revenue
sales ratio study shall be prima facie evidence of the level of
assessment. Additional evidence relevant to the sales ratio
study is also admissible. No sales ratio study received into
evidence shall be conclusive or binding on the court and
evidence of its reliability or unreliability may be introduced
by any party including, but not limited to, evidence of
inadequate adjustment of sale prices for terms of financing,
inadequate adjustment of sales prices to reflect the difference
in the date of sale compared to the assessment date, and
inadequate sample size.
No reduction in value on the grounds of discrimination
shall be granted on the basis of a sales ratio study unless
(a) the sales prices are adjusted for the terms of the sale
to reflect market value,
(b) the sales prices are adjusted to reflect the difference
in the date of sale compared to the assessment date,
(c) there is an adequate sample size, and
(d) the median ratio of the same classification of property
in the same county, city, or town as the subject property is
lower than 90 percent, except that in the case of a county
containing a city of the first class, the median ratio for the
county shall be the ratio determined excluding sales from the
first class city within the county.
If a reduction in value on the grounds of discrimination is
granted based on the above criteria, the reduction shall equal
the difference between (1) the ratio for the petitioner's
property less five percentage points 95 percent and (2) the
median ratio determined by the court. In order to receive
relief on the basis of discrimination, the petitioner must
establish the ratio of the assessor's estimated market value to
the actual fair market value for the property.
Sec. 15. Minnesota Statutes 1990, section 279.01,
subdivision 1, is amended to read:
Subdivision 1. Except as provided in subdivision 3, on May
16 or 21 days after the postmark date on the envelope containing
the property tax statement, whichever is later, a penalty shall
accrue and thereafter be charged upon all unpaid taxes on real
estate on the current lists in the hands of the county
treasurer. The penalty shall be at a rate of three percent on
homestead property and seven percent on nonhomestead property.
This penalty shall not accrue until June 1 of each year, or 21
days after the postmark date on the envelope containing the
property tax statements, whichever is later, on commercial use
real property used for seasonal residential recreational
purposes and classified as class 1c or 4c, and on other
commercial use real property classified as class 3a, provided
that over 60 percent of the gross income earned by the
enterprise on the class 3a property is earned during the months
of May, June, July, and August. Any property owner of such
class 3a property who pays the first half of the tax due on the
property after May 15 and before June 1, or 21 days after the
postmark date on the envelope containing the property tax
statement, whichever is later, shall attach an affidavit to the
payment attesting to compliance with the income provision of
this subdivision. Thereafter, for both homestead and
nonhomestead property, on the first day of each month, up to and
including October 1 following, an additional penalty of one
percent for each month shall accrue and be charged on all such
unpaid taxes provided that if the due date was extended beyond
May 15 as the result of any delay in mailing property tax
statements no additional penalty shall accrue if the tax is paid
by the extended due date. If the tax is not paid by the
extended due date, then all penalties that would have accrued if
the due date had been May 15 shall be charged. When the taxes
against any tract or lot exceed $50, one-half thereof may be
paid prior to May 16 or 21 days after the postmark date on the
envelope containing the property tax statement, whichever is
later; and, if so paid, no penalty shall attach; the remaining
one-half shall be paid at any time prior to October 16
following, without penalty; but, if not so paid, then a penalty
of four percent shall accrue thereon for homestead property and
a penalty of four percent on nonhomestead property. Thereafter,
for homestead property, on the first day of November and
December following, an additional penalty of two percent for
each month shall accrue and be charged on all such unpaid taxes.
Thereafter, for nonhomestead property, on the first day of
November and December following, an additional penalty of four
percent for each month shall accrue and be charged on all such
unpaid taxes. If one-half of such taxes shall not be paid prior
to May 16 or 21 days after the postmark date on the envelope
containing the property tax statement, whichever is later, the
same may be paid at any time prior to October 16, with accrued
penalties to the date of payment added, and thereupon no penalty
shall attach to the remaining one-half until October 16
following.
This section applies to payment of personal property taxes
assessed against improvements to leased property, except as
provided by section 277.01, subdivision 3.
A county may provide by resolution that in the case of a
property owner that has multiple tracts or parcels with
aggregate taxes exceeding $50, payments may be made in
installments as provided in this subdivision.
The county treasurer may accept payments of more or less
than the exact amount of a tax installment due. If the accepted
payment is less than the amount due, payments must be applied
first to the penalty accrued for the year the payment is made.
Acceptance of partial payment of tax does not constitute a
waiver of the minimum payment required as a condition for filing
an appeal under section 278.03 or any other law, nor does it
affect the order of payment of delinquent taxes under section
280.39.
Sec. 16. Minnesota Statutes 1990, section 279.01,
subdivision 2, is amended to read:
Subd. 2. In the case of any tax on class 1b, 2a, and 1a
homestead property paid within 30 days after the due date
specified in this section or after the 30-day extension as
specified in subdivision 3, The county board may, with the
concurrence of the county treasurer, delegate to the county
treasurer the power to abate the penalty provided for late
payment of taxes in the current year. Notwithstanding section
270.07, if any county board so elects, the county treasurer may
abate the penalty on finding that the imposition of the penalty
would be unjust and unreasonable.
Sec. 17. Minnesota Statutes 1990, section 279.06, is
amended to read:
279.06 [COPY OF LIST AND NOTICE.]
Subdivision 1. [LIST AND NOTICE.] Within five days after
the filing of such list, the court administrator shall return a
copy thereof to the county auditor, with a notice prepared and
signed by the court administrator, and attached thereto, which
may be substantially in the following form:
State of Minnesota )
) ss.
County of ............... )
District Court
.......... Judicial District.
The state of Minnesota, to all persons, companies, or
corporations who have or claim any estate, right, title, or
interest in, claim to, or lien upon, any of the several parcels
of land described in the list hereto attached:
The list of taxes and penalties on real property for the
county of ............................... remaining delinquent
on the first Monday in January, 19....., has been filed in the
office of the court administrator of the district court of said
county, of which that hereto attached is a copy. Therefore,
you, and each of you, are hereby required to file in the office
of said court administrator, on or before the 20th day after the
publication of this notice and list, your answer, in writing,
setting forth any objection or defense you may have to the
taxes, or any part thereof, upon any parcel of land described in
the list, in, to, or on which you have or claim any estate,
right, title, interest, claim, or lien, and, in default thereof,
judgment will be entered against such parcel of land for the
taxes on such list appearing against it, and for all penalties,
interest, and costs. Based upon said judgment, the land shall
be sold to the state of Minnesota on the second Monday in May,
19... The period of redemption for all lands sold to the state
at a tax judgment sale shall be three years from the date of
sale to the state of Minnesota if the land is within an
incorporated area unless it is: (a) nonagricultural homesteaded
land as defined in section 273.13, subdivision 22; (b)
homesteaded agricultural land as defined in section 273.13,
subdivision 23, paragraph (a); or (c) seasonal recreational land
as defined in section 273.13, subdivision subdivisions 22,
paragraph (c), and 25, paragraph (d)(1) or (c)(4), clause (5),
in which event the period of redemption is five years from the
date of sale to the state of Minnesota.
The period of redemption for all other lands sold to the
state at a tax judgment sale shall be five years from the date
of sale.
Inquiries as to the proceedings set forth above can be made
to the county auditor of ..... county whose address is ..... .
(Signed) .............................................,
Court Administrator of the District Court of the County
of ....................................................
(Here insert list.)
The list referred to in the notice shall be substantially
in the following form:
List of real property for the county of
......................., on which taxes remain delinquent on the
first Monday in January, 19...:
Town of (Fairfield),
Township (40), Range (20),
Names (and
Current Filed
Addresses) for
the Taxpayers
and Fee Owners
and in Addition
Those Parties
Who Have Filed
Their Addresses Tax
Pursuant to Subdivision of Parcel Total Tax
section 276.041 Section Section Number and Penalty
$ cts.
John Jones S.E. 1/4 of S.W. 1/4 10 23101 2.20
(825 Fremont
Fairfield, MN
55000)
Bruce Smith That part of N.E. 1/4
(2059 Hand of S.W. 1/4 desc. as
Fairfield, follows: Beg. at the
MN 55000) S.E. corner of said
and N.E. 1/4 of S.W. 1/4;
Fairfield thence N. along the E.
State Bank line of said N.E. 1/4
(100 Main of S.W. 1/4 a distance
Street of 600 ft.; thence W.
Fairfield, parallel with the S.
MN 55000) line of said N.E. 1/4
of S.W. 1/4 a distance
of 600 ft.; thence S.
parallel with said E.
line a distance of 600
ft. to S. line of said
N.E. 1/4 of S.W. 1/4;
thence E. along said S.
line a distance of 600
ft. to the point of
beg. ............... 21 33211 3.15
As to platted property, the form of heading shall conform
to circumstances and be substantially in the following form:
City of (Smithtown)
Brown's Addition, or Subdivision
Names (and
Current Filed
Addresses) for
the Taxpayers
and Fee Owners
and in Addition
Those Parties
Who have Filed
Their Addresses Tax
Pursuant to Parcel Total Tax
section 276.041 Lot Block Number and Penalty
$ cts
John Jones 15 9 58243 2.20
(825 Fremont
Fairfield,
MN 55000)
Bruce Smith 16 9 58244 3.15
(2059 Hand
Fairfield,
MN 55000)
and
Fairfield
State Bank
(100 Main Street
Fairfield,
MN 55000)
The names, descriptions, and figures employed in
parentheses in the above forms are merely for purposes of
illustration.
The name of the town, township, range or city, and addition
or subdivision, as the case may be, shall be repeated at the
head of each column of the printed lists as brought forward from
the preceding column.
Errors in the list shall not be deemed to be a material
defect to affect the validity of the judgment and sale.
Subd. 2. [FORM OF LIST AND NOTICE.] Notwithstanding the
provisions of subdivision 1, the commissioner of revenue shall
prescribe the form of the list and notice required under
subdivision 1. The form shall contain the information required
under subdivision 1, but shall be organized and presented in a
manner easily read and understood. The print must be easily
read and contain standard use of capital and lower-case
letters. The court administrator shall use the form prescribed
by the commissioner for purposes of this section. The notices
published and mailed by the county auditor must also be in the
form prescribed by the commissioner.
Sec. 18. Minnesota Statutes 1990, section 281.17, is
amended to read:
281.17 [PERIOD FOR REDEMPTION.]
The period of redemption for all lands sold to the state at
a tax judgment sale shall be three years from the date of sale
to the state of Minnesota if the land is within an incorporated
area unless it is: (a) nonagricultural homesteaded land as
defined in section 273.13, subdivision 22, (b) homesteaded
agricultural land as defined in section 273.13, subdivision 23,
paragraph (a), or (c) seasonal recreational land as defined in
section 273.13, subdivision subdivisions 22, paragraph (c), and
25, paragraph (d)(1) or (c)(4), clause (5), in which event the
period of redemption is five years from the date of sale to the
state of Minnesota.
The period of redemption for homesteaded lands as defined
in section 273.13, subdivision 22, located in a targeted
neighborhood as defined in Laws 1987, chapter 386, article 6,
section 4, and sold to the state at a tax judgment sale is three
years from the date of sale. The period of redemption for all
lands located in a targeted neighborhood as defined in Laws
1987, chapter 386, article 6, section 4, except homesteaded
lands as defined in section 273.13, subdivision 22, and sold to
the state at a tax judgment sale is one year from the date of
sale.
The period of redemption for all other lands sold to the
state at a tax judgment sale shall be five years from the date
of sale.
Sec. 19. Minnesota Statutes 1990, section 282.01,
subdivision 1, is amended to read:
Subdivision 1. [CLASSIFICATION.] It is the general policy
of this state to encourage the best use of tax-forfeited lands,
recognizing that some lands in public ownership should be
retained and managed for public benefits while other lands
should be returned to private ownership. Parcels of land
becoming the property of the state in trust under law declaring
the forfeiture of lands to the state for taxes shall be
classified by the county board of the county in which the
parcels lie as conservation or nonconservation. In making the
classification the board shall consider the present use of
adjacent lands, the productivity of the soil, the character of
forest or other growth, accessibility of lands to established
roads, schools, and other public services, their peculiar
suitability or desirability for particular uses and the
suitability of the forest resources on the land for multiple
use, sustained yield management. The classification,
furthermore, must encourage and foster a mode of land
utilization that will facilitate the economical and adequate
provision of transportation, roads, water supply, drainage,
sanitation, education, and recreation; facilitate reduction of
governmental expenditures; conserve and develop the natural
resources; and foster and develop agriculture and other
industries in the districts and places best suited to them.
In making the classification the county board may use
information made available by any office or department of the
federal, state, or local governments, or by any other person or
agency possessing pertinent information at the time the
classification is made. The lands may be reclassified from time
to time as the county board may consider necessary or desirable,
except for conservation lands held by the state free from any
trust in favor of any taxing district.
If the lands are located within the boundaries of an
organized town, with taxable valuation in excess of $20,000, or
incorporated municipality, the classification or
reclassification and sale must first be approved by the town
board of the town or the governing body of the municipality in
which the lands are located. The town board of the town or the
governing body of the municipality is considered to have
approved the classification or reclassification and sale if the
county board is not notified of the disapproval of the
classification or reclassification and sale within 90 days of
the date the request for approval was transmitted to the town
board of the town or governing body of the municipality. If the
town board or governing body desires to acquire any parcel lying
in the town or municipality by procedures authorized in this
subdivision, it must file a written application with the county
board to withhold the parcel from public sale. The application
must be filed within 90 days of the request for classification
or reclassification and sale. The county board shall then
withhold the parcel from public sale for one year. A clerical
error made by county officials does not serve to eliminate the
request of the town board or governing body if the board or
governing body has forwarded the application to the county
auditor.
Sec. 20. Minnesota Statutes 1990, section 282.33,
subdivision 1, is amended to read:
Subdivision 1. Whenever an unrecorded deed from the state
of Minnesota conveying tax-forfeited lands shall have been lost
or destroyed, an application, in form approved by the attorney
general, for a new deed may be made by the grantee or the
grantee's successor in interest to the commissioner of revenue.
If it appears to the commissioner of revenue that the facts
stated in the petition are true, the commissioner shall issue a
new deed to the original grantee, in form approved by the
attorney general, with like effect as the original deed. The
commissioner shall send the new deed to the county recorder, who
after recording the deed will forward it to the county auditor.
The application shall be accompanied by a fee of $20 $25,
payable to the commissioner of revenue, which shall be deposited
with the state treasurer and credited to the general fund.
Sec. 21. Minnesota Statutes 1990, section 375.192,
subdivision 2, is amended to read:
Subd. 2. Upon written application by the owner of the
property, the county board may grant the reduction or abatement
of estimated market valuation or taxes and of any costs,
penalties, or interest on them as the board deems just and
equitable and order the refund in whole or part of any taxes,
costs, penalties, or interest which have been erroneously or
unjustly paid. The county board may also grant the abatement of
penalties for taxes paid within 30 days of the due date,
regardless of the classification of the property. The
application must include the social security number of the
applicant. The social security number is private data on
individuals as defined by section 13.02, subdivision 12. The
application must be approved by the county assessor, or, if the
property is located in a city of the first or second class
having a city assessor, by the city assessor, and by the county
auditor before consideration by the county board. If the
application is for abatement of penalty or interest, the
application must be approved by the county treasurer and county
auditor. No reduction, abatement, or refund of any special
assessments made or levied by any municipality for local
improvements shall be made unless it is also approved by the
board of review or similar taxing authority of the
municipality. Before taking action on any reduction or
abatement where the reduction of taxes, costs, penalties, and
interest exceed $10,000, the county board shall give 20 days'
notice to the school board and the municipality in which the
property is located. The notice must describe the property
involved, the actual amount of the reduction being sought, and
the reason for the reduction. If the school board or the
municipality object to the granting of the reduction or
abatement, the county board must refer the abatement or
reduction to the commissioner of revenue with its
recommendation. The commissioner shall consider the abatement
or reduction under section 270.07, subdivision 1.
An appeal may not be taken to the tax court from any order
of the county board made in the exercise of the discretionary
authority granted in this section.
Sec. 22. Minnesota Statutes 1990, section 414.031,
subdivision 6, is amended to read:
Subd. 6. [EFFECTIVE DATE OF ANNEXATION.] The annexation
shall be effective as of the date fixed in the annexation order
or on such later date as is fixed in the annexation order. A
copy of the annexation order must be delivered immediately by
the executive director of the Minnesota municipal board to the
appropriate county auditor or auditors. For the purposes of
taxation, if the annexation becomes effective on or before
August 1 of a levy year, the municipality may levy on the
annexed area beginning with that same levy year. If the
annexation becomes effective after August 1 of a levy year, the
town may continue to levy on the annexed area for that levy
year, and the municipality may not levy on the annexed area
until the following levy year.
Sec. 23. Minnesota Statutes 1990, section 414.0325,
subdivision 4, is amended to read:
Subd. 4. [EFFECTIVE DATE OF ANNEXATION.] The board's order
shall be effective upon the issuance of the order or at such
later time as is provided by the board in its order. A copy of
the annexation order must be delivered immediately by the
executive director of the Minnesota municipal board to the
appropriate county auditor or auditors. For the purposes of
taxation, if the annexation becomes effective on or before
August 1 of a levy year, the municipality may levy on the
annexed area beginning with that same levy year. If the
annexation becomes effective after August 1 of a levy year, the
town may continue to levy on the annexed area for that levy
year, and the municipality may not levy on the annexed area
until the following levy year.
Sec. 24. Minnesota Statutes 1990, section 414.033,
subdivision 7, is amended to read:
Subd. 7. Any annexation ordinance provided for in this
section must be filed with the board, the township, the county
auditor and the secretary of state and is final on the date the
ordinance is approved by the board. A copy of the annexation
ordinance must be delivered immediately by the governing body of
the municipality to the appropriate county auditor or auditors.
For the purposes of taxation, if the annexation becomes
effective on or before August 1 of a levy year, the municipality
may levy on the annexed area beginning with that same levy
year. If the annexation becomes effective after August 1 of a
levy year, the town may continue to levy on the annexed area for
that levy year, and the municipality may not levy on the annexed
area until the following levy year.
Sec. 25. Minnesota Statutes 1990, section 414.06,
subdivision 4, is amended to read:
Subd. 4. [EFFECTIVE DATE OF DETACHMENT.] The detachment
shall be effective upon the issuance of the board's order, or at
such later date, as provided by the board in its order. A copy
of the detachment order must be delivered immediately by the
executive director of the Minnesota municipal board to the
appropriate county auditor or auditors. For the purposes of
taxation, if the detachment becomes effective on or before
August 1 of a levy year, the town or towns acquiring the
detached area may levy on it beginning with that same levy
year. If the detachment becomes effective after August 1 of a
levy year, the municipality may continue to levy on the detached
area for that levy year, and the town or towns acquiring the
detached area may not levy on it until the following levy year.
Sec. 26. Minnesota Statutes 1990, section 414.061,
subdivision 3, is amended to read:
Subd. 3. [EFFECTIVE DATE.] The concurrent detachment and
annexation shall be effective upon the issuance of the board's
order, or at such later date as provided by the board in its
order. A copy of the annexation order must be delivered
immediately by the executive director of the Minnesota municipal
board to the appropriate county auditor or auditors. For the
purposes of taxation, if the annexation becomes effective on or
before August 1 of a levy year, the municipality acquiring the
detached area of another municipality may levy on it beginning
with that same levy year. If the annexation becomes effective
after August 1 of a levy year, the municipality losing the
detached area may continue to levy on it for that levy year, and
the municipality acquiring the detached area may not levy on it
until the following levy year.
Sec. 27. Minnesota Statutes 1990, section 477A.014,
subdivision 1, as amended by Laws 1991, chapter 2, article 8,
section 10, is amended to read:
Subdivision 1. [CALCULATIONS AND PAYMENTS.] The
commissioner of revenue shall make all necessary calculations
and make payments pursuant to sections 477A.012, 477A.013, and
477A.03 directly to the affected taxing authorities annually.
In addition, the commissioner shall notify the authorities of
their aid amounts, as well as the computational factors used in
making the calculations for their authority, and those statewide
total figures that are pertinent, before August 15 1 of the year
preceding the aid distribution year, except that for aid payable
in 1990 the commissioner of revenue must notify the authorities
of their aid amounts as well as the computational factors used
in the calculation before October 23, 1989. The commissioner
shall reduce the July 20, 1991, payment of local government aid,
equalization aid, homestead and agricultural credit aid, and
disparity reduction aid to counties, cities, towns, and special
taxing districts by a combined amount of $50,000,000.
Sec. 28. Minnesota Statutes 1990, section 515A.1-105,
subdivision 1, is amended to read:
Subdivision 1. [HOMESTEAD.] (a) Each unit together with
its common element interest constitutes for all purposes a
separate parcel of real estate.
(b) If a declaration is recorded prior to ten 30 days
before any installment of real estate taxes becomes payable, the
local taxing authority shall split the taxes so payable on the
condominium among the units. Interest and penalties which would
otherwise accrue shall not begin to accrue until at least 30
days after the split is accomplished.
(c) A unit used for residential purposes together with not
more than two units used for vehicular parking and their common
element interests shall be treated the same as any other real
estate in determining whether homestead exemptions or
classifications shall apply.
Sec. 29. Laws 1990, chapter 604, article 3, section 49,
subdivision 3, is amended to read:
Subd. 3. [REVERSE REFERENDUM.] If the Bayport city council
intends to exercise the authority provided by this section
in subsequent years levy year 1990, it shall pass a resolution
stating the fact before January September 1, 1991 1990. The
resolution must be published for two successive weeks in the
official newspaper of the city or, if there is no official
newspaper, in a newspaper of general circulation in the city,
together with a notice fixing a date for a public hearing on the
matter. The hearing must be held at least two weeks but not
more than four weeks after the first publication of the
resolution. Following the public hearing, the city may
determine to take no further action or adopt a resolution
confirming its intention to exercise the authority. That
resolution must also be published in the official newspaper of
the city or, if there is no official newspaper, in a newspaper
of general circulation in the city. If within 30 days after
publication of the resolution a petition signed by voters equal
in number to five percent of the votes cast in the city in the
last general election requesting a vote on the proposed
resolution is filed with the county auditor, the resolution is
not effective until it has been submitted to the voters at a
general or special election and a majority of votes cast on the
question of approving the resolution are in the affirmative.
The commissioner of revenue shall prepare a suggested form of
question to be presented at the election. The referendum must
be held at a special or general election before December 1, 1991
1990.
Sec. 30. Laws 1990, chapter 604, article 3, section 50,
subdivision 3, is amended to read:
Subd. 3. [REVERSE REFERENDUM.] If the Goodhue county board
intends to exercise the authority provided by this section
in subsequent years levy years 1990 and 1991, it shall pass a
resolution stating the fact before January September 1, 1991
1990. The resolution must be published for two successive weeks
in the official newspaper of the county or, if there is no
official newspaper, in a newspaper of general circulation in the
county, together with a notice fixing a date for a public
hearing on the matter. The hearing must be held at least two
weeks but not more than four weeks after the first publication
of the resolution. Following the public hearing, the county may
determine to take no further action or adopt a resolution
confirming its intention to exercise the authority. That
resolution must also be published in the official newspaper of
the county or, if there is no official newspaper, in a newspaper
of general circulation in the county. If within 30 days after
publication of the resolution a petition signed by voters equal
in number to five percent of the votes cast in the county in the
last general election requesting a vote on the proposed
resolution is filed with the county auditor, the resolution is
not effective until it has been submitted to the voters at a
general or special election and a majority of votes cast on the
question of approving the resolution are in the affirmative.
The commissioner of revenue shall prepare a suggested form of
question to be presented at the election. The referendum must
be held at a special or general election before December 1, 1991
1990.
Sec. 31. Laws 1990, chapter 604, article 3, section 51,
subdivision 3, is amended to read:
Subd. 3. [REVERSE REFERENDUM.] If the Windom city council
intends to exercise the authority provided by this section in
subsequent years levy year 1991, it shall pass a resolution
stating the fact before January September 1, 1991. The
resolution must be published for two successive weeks in the
official newspaper of the city or, if there is no official
newspaper, in a newspaper of general circulation in the city,
together with a notice fixing a date for a public hearing on the
matter. The hearing must be held at least two weeks but not
more than four weeks after the first publication of the
resolution. Following the public hearing, the city may
determine to take no further action or adopt a resolution
confirming its intention to exercise the authority. That
resolution must also be published in the official newspaper of
the city or, if there is no official newspaper, in a newspaper
of general circulation in the city. If within 30 days after
publication of the resolution a petition signed by voters equal
in number to five percent of the votes cast in the city in the
last general election requesting a vote on the proposed
resolution is filed with the county auditor, the resolution is
not effective until it has been submitted to the voters at a
general or special election and a majority of votes cast on the
question of approving the resolution are in the affirmative.
The commissioner of revenue shall prepare a suggested form of
question to be presented at the election. The referendum must
be held at a special or general election before December 1, 1991.
Sec. 32. Laws 1990, chapter 604, article 3, section 59,
subdivision 2, is amended to read:
Subd. 2. [REVERSE REFERENDUM.] If the Rosemount city
council proposes to pay the obligation under subdivision 1, it
shall pass a resolution stating that fact. Thereafter, the
resolution shall be published for two successive weeks in the
official newspaper of the city or, if there is no official
newspaper, in a newspaper of general circulation in the city,
together with a notice fixing a date for a public hearing on the
matter. The hearing shall be held not less than two weeks nor
more than four weeks after the first publication of the
resolution. Following the public hearing, the city may
determine to take no further action or adopt a resolution
confirming its intention to exercise the authority. That
resolution shall also be published in the official newspaper or,
if there is no official newspaper, in a newspaper of general
circulation in the city. If within 30 days thereafter a
petition signed by voters equal in number to ten percent of the
votes cast in the city in the last general election requesting a
referendum on the proposed resolution is filed with the county
auditor, the resolution shall not be effective until it has been
submitted to the voters at a general or special election and a
majority of votes cast on the question of approving the
resolution are in the affirmative. The commissioner of revenue
shall prepare a suggested form of question to be presented at
the referendum. The referendum must be held at a special or
general election prior to January December 1, 1992 1990.
Sec. 33. Laws 1990, chapter 604, article 3, section 61,
subdivision 2, is amended to read:
Subd. 2. [REVERSE REFERENDUM.] If the city intends to
exercise the authority provided by subdivision 1 in levy year
1990 and subsequent years, it shall pass a resolution stating
the fact before January September 1, 1991 1990. The resolution
must be published for two successive weeks in the official
newspaper of the city or, if there is no official newspaper, in
a newspaper of general circulation in the city, together with a
notice fixing a date for a public hearing on the matter. The
hearing must be held at least two weeks but not more than four
weeks after the first publication of the resolution. Following
the public hearing, the city may determine to take no further
action or adopt a resolution confirming its intention to
exercise the authority. That resolution must also be published
in the official newspaper of the city or, if there is no
official newspaper, in a newspaper of general circulation in the
city. If within 30 days after publication of the resolution a
petition signed by voters equal in number to five percent of the
votes cast in the city in the last general election requesting a
vote on the proposed resolution is filed with the county
auditor, the resolution is not effective until it has been
submitted to the voters at a general or special election and a
majority of votes cast on the question of approving the
resolution are in the affirmative. The commissioner of revenue
shall prepare a suggested form of question to be presented at
the election. The referendum must be held at a special or
general election before December 1, 1991 1990.
Sec. 34. Laws 1990, chapter 604, article 4, section 22, is
amended to read:
Sec. 22. [EFFECTIVE DATES.]
Sections 1, 3, 8, 9, 11, 14, 18, and 20 are effective for
aids payable in calendar year 1990 and thereafter. Section 18
is effective for homestead and agricultural credit aid payments
for taxes payable in 1990. Sections 2, 4, 5, 7, 10, 12, 13, 15,
and 17 are effective for aids payable in calendar year 1991 and
thereafter. Sections 19 and 21 are effective for aids payable
in calendar year 1992 and thereafter. That part of section 6
striking a reference to cities of the first class is effective
for aids equalization aid paid under section 477A.013,
subdivision 5, in calendar year 1991 and thereafter. The rest
of section 6 is effective for aids paid in calendar year 1990
and thereafter. Section 16 is effective July 1, 1990, and
applies to payments due on or after that date.
Sec. 35. [REPEALER.]
Minnesota Statutes 1990, section 273.137, is repealed.
Laws 1989, chapter 277, article 4, section 2, is repealed.
Sec. 36. [EFFECTIVE DATES.]
Sections 1, 3, 9, 11, 17 to 19, and 35 are effective the
day following final enactment. Sections 2, 4, 7, 8, 12, 15, 16,
and 22 to 26 are effective for taxes levied in 1991, payable in
1992 and thereafter. Sections 5 and 6 are effective for taxes
levied in 1992, payable in 1993 and thereafter. Section 27 is
effective for aids payable in 1992 and thereafter. Section 10
is effective for aids payable in 1991 and thereafter. Section
13 is effective for tax petitions filed for taxes payable in
1992 and thereafter. Section 14 is effective for petitions
based on taxes levied in 1989, payable in 1990, and thereafter,
which have not been determined by the court or settled between
the parties by the date of final enactment of this act. Section
20 is effective June 1, 1990. Sections 21 and 28 are effective
July 1, 1991. Section 29 is effective for taxes levied in 1990,
payable in 1991. Section 30 is effective for taxes levied in
1990 and 1991, payable in 1991 and 1992. Section 31 is
effective for taxes levied in 1991, payable in 1992. Sections
32 and 33 are effective for taxes levied in 1990, payable in
1991, and thereafter. The amendments in section 34 changing the
effective date of section 18 are effective for homestead and
agricultural credit aid payments for taxes payable in 1990. The
amendment in section 34 changing the effective date of section 6
to refer to equalization aid is effective for aids payable in
calendar year 1991, and thereafter.
ARTICLE 13
FIRE AID
Section 1. Minnesota Statutes 1990, section 69.011,
subdivision 1, is amended to read:
Subdivision 1. [DEFINITIONS.] Unless the language or
context clearly indicates that a different meaning is intended,
the following words and terms shall for the purposes of this
chapter and chapters 423, 423A, 424 and 424A have the meanings
ascribed to them:
(a) "Commissioner" means the commissioner of revenue.
(b) "Municipality" means any home rule charter or statutory
city, organized town or park district subject to chapter 398,
and the University of Minnesota.
(c) "Minnesota Firetown Premium Report" means a form
prescribed by the commissioner containing space for reporting by
insurers of fire, lightning, sprinkler leakage and extended
coverage premiums received upon risks located or to be performed
in this state less return premiums and dividends.
(d) "Firetown" means the area serviced by any municipality
having a qualified fire department or a qualified incorporated
fire department having a subsidiary volunteer firefighters'
relief association.
(e) "Net tax capacity" "Market value" means latest
available net tax capacity market value of all property in a
taxing jurisdiction, whether the property is subject to
taxation, or exempt from ad valorem taxation obtained from
information which appears on abstracts filed with the
commissioner of revenue or equalized by the state board of
equalization.
(f) "Minnesota Aid to Police Premium Report" means a form
prescribed by the commissioner for reporting by each fire and
casualty insurer of all premiums received upon direct business
received by it in this state, or by its agents for it, in cash
or otherwise, during the preceding calendar year, with reference
to insurance written for insuring against the perils contained
in auto insurance coverages as reported in the Minnesota
business schedule of the annual financial statement which each
insurer is required to file with the commissioner in accordance
with the governing laws or rules less return premiums and
dividends.
(g) "Peace officer" means any person:
(1) whose primary source of income derived from wages is
from direct employment by a municipality or county as a law
enforcement officer on a full-time basis of not less than 30
hours per week;
(2) who has been employed for a minimum of six months prior
to December 31 preceding the date of the current year's
certification pursuant to under subdivision 2, clause (b);
(3) who is sworn to enforce the general criminal laws of
the state and local ordinances;
(4) who is licensed by the peace officers standards and
training board and is authorized to arrest with a warrant; and
(5) who is a member of a local police relief association to
which section 69.77 applies or the public employees police and
fire fund.
(h) "Full-time equivalent number of peace officers
providing contract service" means the integral or fractional
number of peace officers which would be necessary to provide the
contract service if all peace officers providing service were
employed on a full-time basis as defined by the employing unit
and the municipality receiving the contract service.
(i) "Retirement benefits other than a service pension"
means any disbursement authorized pursuant to under section
424A.05, subdivision 3, clauses (2), (3) and (4).
(j) "Municipal clerk, municipal clerk-treasurer or county
auditor" means the person who was elected or appointed to the
specified position or, in the absence of the person, another
person who is designated by the applicable governing body. In a
park district the clerk is the secretary of the board of park
district commissioners. In the case of the University of
Minnesota, the clerk is that official designated by the board of
regents.
Sec. 2. Minnesota Statutes 1990, section 69.011,
subdivision 3, is amended to read:
Subd. 3. [FAILURE TO FILE CERTIFICATE DEEMED WAIVER.]
If the certificate a certification required by this section is
not filed with the commissioner within the time prescribed by
this section the municipality or nonprofit fire fighting
corporation shall be deemed to have relinquished its rights for
the year to the benefits under this chapter by the due date
prescribed by this section, the commissioner shall notify the
municipality or the nonprofit fire fighting corporation that a
portion or all of its current year aid will be forfeited if the
certification is not received within ten days. The amount of
aid forfeited is equal to the amount of state police aid or
state fire aid determined for the municipality or fire fighting
corporation for the current year, multiplied by five percent for
each week or fraction of a week that this certification is
late. The penalty will be computed beginning ten days after the
postmark date of the commissioner's notification as required
under this subdivision. All forfeited aid amounts revert to the
general fund in the state treasury. Failure to receive the
certificate form cannot be used as a defense for not filing.
Sec 3. Minnesota Statutes 1990, section 69.021,
subdivision 2, is amended to read:
Subd. 2. [REPORT OF PREMIUMS.] Each insurer, including
township and farmers mutual insurers where applicable, shall
return to the commissioner with its annual financial statement
the reports described in subdivision 1 certified by its
secretary and president or chief financial officer. The
Minnesota Firetown Premium Report shall contain a true and
accurate statement of the total premium for all gross direct
fire, lightning, and sprinkler leakage, and extended coverage
insurance of all domestic mutual insurers and the total premiums
for all gross direct fire, lightning, sprinkler leakage and
extended coverage insurance of all other insurers, less return
premiums and dividends received by them on that business written
or done during the preceding calendar year upon property located
within the state or brought into the state for temporary use.
The fire and extended coverage portion of multiperil and
multiple peril package premiums and all other combination
premiums shall be determined by applying percentages determined
by the commissioner or by rating bureaus recognized by the
commissioner. The Minnesota Aid to Police Premium Report shall
contain a true and accurate statement of the total premiums,
less return premiums and dividends, on all direct business
received by such insurer in this state, or by its agents for it,
in cash or otherwise, during the preceding calendar year, with
reference to insurance written for perils described in section
69.011, subdivision 1, clause (f), except that domestic mutual
insurance companies must not file a report.
Sec. 4. Minnesota Statutes 1990, section 69.021,
subdivision 4, is amended to read:
Subd. 4. [DETERMINATION OF QUALIFIED STATE AID RECIPIENTS;
CERTIFICATION TO COMMISSIONER OF REVENUE.] The commissioner
shall determine which municipalities and independent nonprofit
firefighting corporations are qualified to receive fire state
aid and which municipalities and counties are qualified to
receive police state peace officer aid. The commissioner shall
determine qualification upon receipt of (1) the fire department
personnel and equipment certification or the police department
and qualified peace officers certificate, whichever is
applicable, required pursuant to under section 69.011, (2) the
financial compliance report required pursuant to under section
6.495, and (3) any other relevant information which comes to the
attention of the commissioner. Upon completion of the
determination, on or before September 1, the commissioner shall
calculate pursuant to under subdivision 6 the amount of fire
state aid and police (a) state peace officer aid which each
county, or municipality, or independent nonprofit firefighting
corporation is to receive and (b) fire state aid which each
municipality or nonprofit firefighting corporation is to
receive. The commissioner shall certify to the commissioner of
finance the name of each county, or municipality, and the amount
of state aid which each county or municipality is to receive, in
the case of state peace officer aid; and the name of each
municipality or independent nonprofit firefighting corporation
and the amount of state aid which each municipality or
independent nonprofit firefighting corporation is to receive, in
the case of fire state aid.
Sec. 5. Minnesota Statutes 1990, section 69.021,
subdivision 5, is amended to read:
Subd. 5. [CALCULATION OF STATE AID.] The amount of state
aid available for apportionment shall be two percent of the
fire, lightning, sprinkler leakage, and extended coverage
premiums reported to the commissioner by insurers on the
Minnesota Firetown Premium Report and two percent of the
premiums reported to the commissioner by insurers on the
Minnesota Aid to Police Premium Report. This amount shall be
reduced by the amount required to pay the state auditor's costs
and expenses of the audits or exams of the firefighters relief
associations. The total amount for apportionment in respect to
police state aid shall not be greater or lesser than the amount
of premium taxes paid to the state upon the premiums reported to
the commissioner by insurers on the Minnesota Aid to Police
Premium Report after subtracting the amount required to pay the
state auditor's costs and expenses of the audits or exams of the
police relief associations. The total amount for apportionment
in respect to firefighters state aid shall not be greater or
lesser than the amount of premium taxes paid to the state upon
the premiums reported to the commissioner by insurers on the
Minnesota Firetown Premium Report after subtracting the amount
required to pay the state auditor's costs and expenses of the
audits or exams of the firefighters relief associations. The
amount for apportionment in respect to police state aid shall be
distributed to the municipalities maintaining police departments
and to the county on the basis of the number of active peace
officers, as certified pursuant to section 69.011, subdivision
2, clause (b). The commissioner shall calculate the percentage
of increase or decrease reflected in the apportionment over or
under the previous year's available state aid using the same
premiums as a basis for comparison.
Sec. 6. Minnesota Statutes 1990, section 69.021,
subdivision 6, is amended to read:
Subd. 6. [CALCULATION OF APPORTIONMENT OF STATE PEACE
OFFICERS AID TO COUNTIES.] With respect to firefighters,
one-half of the state aid available shall be distributed to the
counties in proportion to their population as shown by the last
official statewide federal census. The remaining one-half of
the state aid available shall be distributed to the counties in
proportion to their net tax capacity, excluding mineral values.
In the case of incorporated or municipal fire departments
furnishing fire protection to cities, towns, or townships in
other counties as evidenced by valid fire service contracts
filed with the commissioner and county auditor the distribution
to the respective counties shall be adjusted proportionately to
take into consideration the crossover fire protection service.
Necessary adjustments shall be made to subsequent apportionments.
The state aid available in respect to peace officers shall
not exceed the amount of tax collected and shall be distributed
to the counties in proportion to the total number of active
peace officers, as defined in section 69.011, subdivision 1,
clause (g), in each county who are employed either by
municipalities maintaining police departments or by the county.
Any necessary adjustments shall be made to subsequent
apportionments.
Sec. 7. Minnesota Statutes 1990, section 69.021,
subdivision 7, is amended to read:
Subd. 7. [APPORTIONMENT OF AID TO MUNICIPALITIES AND
RELIEF ASSOCIATIONS.] (1) The commissioner shall apportion the
state aid relative to the premiums reported on the Minnesota
Firetown Premium Reports filed pursuant to under this chapter to
each municipality and/or firefighters' relief association in the
same manner that state aid is apportioned to the counties,
one-half in proportion to the population as shown in the last
official statewide federal census for each fire town and
one-half in proportion to the net tax capacity market value
of the each fire towns in the county for which aid is
proportioned town, including the market value of tax exempt
property, but excluding the market value of minerals. In the
case of incorporated or municipal fire departments furnishing
fire protection to other cities, towns, or townships as
evidenced by valid fire service contracts filed with the
commissioner, the distribution shall be adjusted proportionately
to take into consideration the crossover fire protection
service. Necessary adjustments shall be made to subsequent
apportionments.
In the case of municipalities or independent fire
departments qualifying for the aid, the commissioner shall
calculate the state aid for the municipality or relief
association on the basis of the population and the net tax
capacity market value of the area furnished fire protection
service by the fire department as evidenced by duly executed and
valid fire service agreements filed with the commissioner. If
one or more fire departments are furnishing contracted fire
service to a city, town, or township, only the population and
net tax capacity market value of the area served by each fire
department shall be considered in calculating the state aid and
the fire departments furnishing service shall enter into an
agreement apportioning among themselves the percent of the
population and the net tax capacity market value of each service
area. The agreement shall be in writing and filed with the
commissioner in duplicate. The commissioner shall forward one
copy of the agreement to the county auditor of the county
wherein the fire department is located and retain one copy.
The aid shall be paid to the treasurer of the municipality
where the fire department is located and the treasurer of the
municipality shall within 30 days transmit the aid to the relief
association if the relief association has filed a financial
report with the treasurer of the municipality and has met all
other statutory provisions pertaining to the aid apportionment.
The commissioner is hereby empowered to may make rules to
permit the administration of the provisions of this section.
(2) The commissioner shall apportion the state police peace
officer aid to each municipality and to the county in the
following manner:
(a) For all municipalities maintaining police departments
and the county, the state aid shall be distributed in proportion
to the total number of peace officers, as determined pursuant to
under section 69.011, subdivision 1, clause (g), and subdivision
2, clause (b), employed by each municipality and by the county
for 12 calendar months and the proportional or fractional number
who were employed less than 12 months;
(b) For each municipality which contracts with the county
for police service, a proportionate amount of the state aid
distributed to the county based on the full-time equivalent
number of peace officers providing contract service shall be
credited against the municipality's contract obligation;
(c) For each municipality which contracts with another
municipality for police service, a proportionate amount of the
state aid distributed to the municipality providing contract
service based on the full-time equivalent number of peace
officers providing contract service on a full-time equivalent
basis shall be credited against the contract obligation of the
municipality receiving contract service;
(d) No municipality entitled to receive police state peace
officer aid shall be apportioned less police state peace officer
aid for any year under Laws 1976, chapter 315, than the amount
which was apportioned to it for calendar year 1975 based on
premiums reported to the commissioner for calendar year 1974;
provided, the amount of police state peace officer aid to other
municipalities within the county and to the county shall be
adjusted in proportion to the total number of peace officers in
the municipalities and the county, so that the amount of police
state peace officer aid apportioned shall not exceed the amount
of police state peace officer aid available for apportionment.
Sec. 8. Minnesota Statutes 1990, section 69.021,
subdivision 8, is amended to read:
Subd. 8. [POPULATION AND TAX CAPACITY MARKET VALUE.] In
computations requiring the use of population figures only
official statewide federal census figures are to be used.
Increases or decreases in population disclosed by reason of any
special census shall not be taken into consideration.
In calculations requiring the use of net tax capacity
market value figures, only the latest available net tax capacity
market value figures are to be used.
Sec. 9. Minnesota Statutes 1990, section 69.021,
subdivision 9, is amended to read:
Subd. 9. [APPEAL.] In the event that any fire or police
department feels itself to be aggrieved, it may request the
commissioner to review and adjust the apportionment of funds
within the county in the case of state peace officer aid, and
within the state in the case of fire state aid, and the decision
of the commissioner shall be subject to appeal, review, and
adjustment by the district court in the county in which the fire
or police department is located.
Sec. 10. [EFFECTIVE DATE.]
Sections 1 and 3 to 9 are effective for aids payable in
1991 and thereafter. Section 2 is effective for aids paid in
1992 and thereafter.
ARTICLE 14
LOCAL GOVERNMENT SERVICE SHARING AND
COMBINATION INCENTIVES
Section 1. [465.80] [SERVICE SHARING GRANTS.]
Subdivision 1. [SCOPE.] This section establishes a program
for grants to cities, counties, and towns to enable them to meet
the start-up costs of providing shared services or functions.
Subd. 2. [ELIGIBILITY.] Any home rule charter or statutory
city, county, or town that provides a plan for offering a
governmental service under a joint powers agreement with another
city, county, or town, or with an agency of state government, is
eligible for a grant under this section, and is referred to in
this section as an "eligible local government unit."
Subd. 3. [PLAN.] To apply for a grant under this section,
the governing body of the eligible local government unit must by
resolution adopt a plan that includes:
(1) a proposal to enter into an agreement for the joint
exercise of powers under section 471.59 that will result in a
fully integrated service or function provided by the eligible
local unit of government and one or more other government units
as defined in section 471.59. Agreements solely to make joint
purchases are not sufficient to qualify under this section;
(2) specific projections of cost savings or more efficient
service operations that are reasonably likely to result from the
combined service or function; and
(3) evidence of the need for financial assistance to meet
start-up costs that would be entailed in providing the combined
service or function.
Subd. 4. [SUBMISSION OF PLAN TO DEPARTMENT.] The plan must
be submitted to the department of trade and economic
development. The commissioner of trade and economic development
will approve a plan only if it contains the elements set forth
in subdivision 3, with sufficient information to verify the
assertions under clauses (2) and (3). The commissioner may
request modifications of a plan. If the commissioner rejects a
plan, written reasons for the rejection must be provided, and a
governmental unit may modify the plan and resubmit it.
Subd. 5. [GRANTS.] The amount of each grant shall be equal
to the additional start-up costs for which evidence is presented
under subdivision 3, clause (3). Only one grant will be given
to a local government unit for any function or service it
proposes to combine with another government unit, but a unit may
apply for separate grants for different services or functions it
proposes to combine. If the amount of money available for
making the grants is not sufficient to fully fund the grants to
eligible local government units with approved plans, the
commissioner shall award grants on the basis of each qualified
applicant's score under a scoring system to be devised by the
commissioner to measure the relative needs for the grants and
the ratio of costs to benefits for each proposal.
Sec. 2. [465.81] [COOPERATION AND COMBINATION.]
Subdivision 1. [SCOPE.] Sections 2 to 8 establish
procedures to be used by counties, cities, or towns that adopt
by resolution an agreement providing a plan to provide combined
services during an initial two-year cooperation period and then
to merge into a single unit of government over the succeeding
two-year period.
Subd. 2. [DEFINITIONS.] As used in sections 2 to 8, the
words defined in this subdivision have the meanings given them
in this subdivision.
"City" means home rule charter or statutory cities.
"Commissioner" means the commissioner of trade and economic
development.
"Department" means the department of trade and economic
development.
"Governing body" means, in the case of a county, the county
board; in the case of a city, the city council; and, in the case
of a town, the town board.
"Local government unit" or "unit" includes counties,
cities, and towns.
Subd. 3. [COMBINATION REQUIREMENTS.] Counties may combine
with one or more other counties. Cities may combine with one or
more other cities or with one or more towns. Towns may combine
with one or more other towns or with one or more cities. Units
that combine must be contiguous.
Sec. 3. [465.82] [COOPERATION AND COMBINATION PLAN.]
Subdivision 1. [ADOPTION AND STATE AGENCY REVIEW.] Each
governing body that proposes to combine under sections 2 to 8
must adopt by resolution a plan for cooperation and
combination. The plan must address each item in this section.
The plan must be specific for any item that will occur within
three years and may be general or set forth alternative
proposals for an item that will occur more than three years in
the future. The plan must be submitted to the department of
trade and economic development for review and comment.
Significant modifications and specific resolutions of items must
be submitted to the department for review and comment. In the
official newspaper of each local government unit proposed for
combination, the governing body must publish at least a summary
of the adopted plans, each significant modification and
resolution of items, and the results of each department review
and comment.
Subd. 2. [CONTENTS OF PLAN.] The plan shall state:
(1) the specific cooperative activities the units will
engage in during the first two years of the venture;
(2) the steps to be taken to effect the merger of the
governmental units, beginning in the third year of the process,
with completion no later than four years after the process
begins;
(3) the steps by which a single governing body will be
created. Notwithstanding any other law to the contrary, all
current members of the governing bodies of the local government
units that propose to combine under sections 2 to 8 may serve on
the initial governing body of the combined unit, until a gradual
reduction in membership is achieved by foregoing election of new
members when terms expire until the number permitted by other
law is reached;
(4) changes in services provided, facilities used,
administrative operations and staffing to effect the preliminary
cooperative activities and the final merger;
(5) treatment of employees of the merging governmental
units, specifically including provisions for reassigning
employees, dealing with unions, and providing financial
incentives to encourage early retirements;
(6) financial arrangements for the merger, specifically
including responsibility for debt service on outstanding
obligations of the merging entities;
(7) two, five, and ten-year projections prepared by the
department of revenue at the request of the local government
unit, of revenues, expenditures, and property taxes for each
unit if it combined and if it remained separate;
(8) procedures for a referendum to be held prior to the
year of the proposed combination to approve combining the local
government units, specifically stating whether a majority of
those voting in each district proposed for combination or a
majority of those voting on the question in the entire area
proposed for combination would be needed to pass the referendum;
and
(9) a time schedule for implementation.
Sec. 4. [465.83] [STATE AGENCY APPROVAL.]
Before scheduling a referendum on the question of combining
local government units under section 5, the units shall submit
the plan adopted under section 3 to the commissioner. The
commissioner may require any information it deems necessary to
evaluate the plan. The commissioner shall disapprove the
proposed combination if the commissioner finds that the plan is
not reasonably likely to enable the combined unit to provide
services in a more efficient or less costly manner than the
separate units would provide them, or if the plans or plan
modification are incomplete.
Sec. 5. [465.84] [REFERENDUM.]
During the first or second year of cooperation, and after
approval of the plan by the department under section 4, a
referendum on the question of combination shall be conducted.
The referendum shall be on a date called by the governing bodies
of the units that propose to combine. The referendum shall be
conducted according to the Minnesota election law, as defined in
section 200.01. If the referendum fails, the same question or a
modified question may be submitted the following year. If the
referendum fails again, the same question may not be submitted.
Referendums shall be conducted on the same date in all local
government units.
Sec. 6. [465.85] [COUNTY AUDITOR TO PREPARE PLAT.]
Upon the request of two or more local government units that
have adopted a resolution to cooperate and combine, the county
auditor shall prepare a plat. If the proposed combined local
government unit is located in more than one county, the request
shall be submitted to the county auditor of the county that has
the greatest land area in the proposed district. The plat must
show:
(1) the boundaries of each of the present units;
(2) the boundaries of the proposed unit;
(3) the boundaries of proposed election districts, if
requested; and
(4) other information deemed pertinent by the governing
bodies or the county auditor.
Sec. 7. [465.86] [BONDED DEBT AT THE TIME OF COMBINATION.]
Debt service for bonds outstanding at the time of the
combination may be levied by the combined governing body
consistent with the plan adopted according to section 3, and any
subsequent modifications, subject to section 475.61. The
primary obligation to pay the bonded indebtedness outstanding on
the effective date of combination remains with the local
government unit that issued the bonds, but a combined unit may
make debt service payments on behalf of a preexisting unit.
Sec. 8. [465.87] [AIDS TO COOPERATING AND COMBINING
UNITS.]
Subdivision 1. [ELIGIBILITY.] A local government unit is
eligible for aid under this section if the commissioner has
approved its plan to cooperate and combine under section 4.
Subd. 2. [AMOUNT OF AID.] The aid to be paid to each
eligible local government unit is equal to the following per
capita amounts, based on the combined population of the units,
not to exceed $100,000 per year for any unit.
Combined Population Aid
after Combination Per Capita
0 - 2,500 $25
2,500 - 5,000 20
5,000 - 20,000 15
over 20,000 10
Payments shall be made on the dates provided for payments of
local government aid under section 477A.013, beginning in the
year during which substantial cooperative activities under the
plan initially occur, unless those activities begin after July
1, in which case the initial aid payment shall be made in the
following calendar year.
Subd. 3. [TERMINATION OF AID; RECAPTURE.] If a second
referendum under section 5 fails, or if an initial referendum
fails and the governing body does not schedule a second
referendum within one year after the first has failed, or if one
or more of the local government units that proposed to combine
terminates its participation in the cooperation or combination,
no additional aid will be paid under this section. The amount
previously paid under this section to a unit must be repaid if
the governing body of the unit acts to terminate its current
level of participation in the plan. The amount previously paid
to the unit must be repaid in annual installments equal to the
total amount paid to the unit for all years under subdivision 2,
divided by the number of years when payments were made.
Sec. 9. [APPROPRIATION.]
$1,500,000 is appropriated to the commissioner of trade and
economic development to be used to make the grants under section
1 and to pay the aids under sections 2 to 8. At least 40
percent of the amount appropriated under this section shall be
used to make aid payments under sections 2 to 8 unless there are
not enough qualified applicants for the cooperation and
combination program to make use of the full appropriation. *
(Section 9 was vetoed by the governor.)
ARTICLE 15
DELINQUENT TAXES ON PERSONAL PROPERTY
Section 1. [47.209] [MANUFACTURED HOME FINANCING; PROPERTY
TAX ESCROW REQUIREMENT.]
Any agreement entered into after December 31, 1991, for the
financing or refinancing of a purchase of a manufactured home
shall require that the lender maintain an escrow account for
deposit of payments for property taxes payable on the
manufactured home, and that the borrower make the required
payments. As used in this section, "lender" includes a state
bank and trust company, national banking association, state or
federally chartered savings and loan association, mortgage bank,
mutual savings bank, insurance company, credit union, or a
dealer as defined in section 327B.01, subdivision 7, who enters
into an agreement for financing or refinancing a purchase of a
manufactured home.
Sec. 2. Minnesota Statutes 1990, section 274.19,
subdivision 3, is amended to read:
Subd. 3. [TAX STATEMENTS; PENALTIES; COLLECTIONS.] Not
later than July 15 in the year of assessment the county
treasurer shall mail to the taxpayer a statement of tax due on a
manufactured home. The taxes are due on the last day of August,
except that if the tax exceeds $50, one-half of the amount due
may be paid on August 31, and the remainder on November 15.
Taxes remaining unpaid after the due date are delinquent, and a
penalty of eight percent must be assessed and collected as part
of the unpaid taxes. On September 30 the county treasurer shall
make a list of taxes remaining unpaid and shall certify the list
immediately to the court administrator of district court. The
court administrator shall issue warrants to the sheriff for
collection.
Sec. 3. [277.17] [ESCROW REQUIREMENT FOR DELINQUENCIES ON
MANUFACTURED HOMES.]
Subdivision 1. [CERTIFICATION TO MANUFACTURED HOME OWNER.]
On or before October 15 of each year, the county auditor shall
send a letter to each owner of a manufactured home for which the
personal property taxes due on August 31 are delinquent as of
September 30. On or before December 31 of each year, the county
auditor shall send a letter to each owner of a manufactured home
for which the taxes due on August 31 were not delinquent but the
personal property taxes due on November 15 are delinquent as of
December 15. The letter must inform the owner that due to the
delinquency, the owner will be required under state law to begin
making monthly payments of delinquent property taxes, and that
the property taxes will also be escrowed for payment of property
taxes the following year. The form and content of the notice to
the owner shall be specified by the commissioner of revenue.
Subd. 2. [ESTABLISHMENT OF TAX ESCROW ACCOUNTS.] The
county auditor must establish a tax escrow account for
delinquent property taxes for each owner receiving a letter
under subdivision 1. An owner who receives a notice regarding
taxes due August 31 must pay an additional amount each month
equal to ten percent of the delinquent personal property taxes,
penalties, and interest due, plus ten percent of the tax payable
in the following calendar year. If the owner fails to pay the
tax due on November 15, the additional amount of tax due but
unpaid will be added to the delinquent property taxes payable by
installment under this section. An owner who receives a notice
regarding taxes due November 15 must pay an additional amount
each month equal to 15 percent of the delinquent taxes,
penalties, and interest due, plus 12 percent of the tax payable
in the following calendar year.
Subd. 3. [COUNTY ESCROW.] Within 30 days of receipt of a
letter from the county auditor under subdivision 1, the owner
must make the first monthly payment under subdivision 2 to the
county auditor. The commissioner of revenue shall prescribe the
procedures to be used for monthly collections of the delinquent
and current tax payments. If an owner is making the payments at
the time required under this section, no action may be taken
under section 4 with respect to the manufactured home for which
the property taxes are being paid into the escrow account.
Sec. 4. [277.20] [LIEN FOR PERSONAL PROPERTY TAX.]
Subdivision 1. [CREATION OF LIEN.] Except for property
exempt under subdivision 3, the tax assessed on personal
property or manufactured homes and collectible under this
chapter is a lien on all the real and personal property within
this state of the person liable for the payment of the tax. The
lien arises on January 2 of the year in which the tax is
assessed and continues until the tax is paid. For purposes of
this section and section 277.21, "tax" also includes penalty,
interest, recording fees, sheriff fees, and court costs that may
accrue on the unpaid tax.
Subd. 2. [FILING OF LIEN FOR ENFORCEABILITY.] The lien
imposed by subdivision 1 is not enforceable against any
purchaser, mortgagee, pledgee, holder of a uniform commercial
code security interest, mechanic's lienor, or judgment lien
creditor until a notice of lien has been filed by the county
treasurer in the office of the county recorder of the county in
which the property is situated, or in the case of personal
property belonging to an individual who is not a resident of
this state, or that is a corporation, partnership, or other
organization, in the office of the secretary of state. Priority
of a lien created under this article shall be determined in
accordance with the provisions of section 507.34. Liens filed
in the office of the county recorder shall be filed with the
state tax liens filed pursuant to section 270.69, and the index
shall indicate the name of the county for which the lien was
filed. If the land is registered, the notice of lien shall be
filed in the office of the registrar of titles of the county in
which the property is registered. Notwithstanding any other law
to the contrary, the county treasurer is exempt from the payment
of fees when the lien is offered for filing or recording; the
fee for filing or recording the lien must be paid at the time
the release of lien is offered for filing or recording.
Notwithstanding any law to the contrary, the fee for filing or
recording the lien or the release of lien is $15.
Subd. 3. [EXEMPT PROPERTY.] The lien imposed on personal
property by this section, even though properly filed, is not
enforceable against the personal property listed as exempt in
sections 550.37, 550.38, and 550.39, but manufactured homes
otherwise exempt under section 550.37, subdivision 12, are
subject to lien under this section.
Subd. 4. [PERIOD OF LIMITATIONS.] Notwithstanding any
other law to the contrary, the lien imposed by this section is
enforceable from the time the lien arises and for ten years from
the date of filing the notice of lien. The notice of lien must
be filed by the county treasurer within five years after the
date of assessment of the tax. A notice of lien filed in one
county may be transcribed to any other county within ten years
after the date of its filing, but the transcription does not
extend the period during which the lien is enforceable. A
notice of lien may be renewed by the county treasurer before the
expiration of the ten-year period for an additional ten years.
The taxpayer must receive written notice of the renewal.
Subd. 5. [ENFORCEABILITY OF LIEN.] The lien imposed by
this section is enforceable by levy as authorized in section
277.21, or by judgment lien foreclosure as authorized in chapter
550.
Subd. 6. [NOTICE OF MORTGAGE FORECLOSURE OR CONTRACT
TERMINATION.] If a lien has been filed by the county treasurer
against real property under this section, and, after the
recording of the lien, a mortgage foreclosure upon the real
property is commenced under chapter 580, or a termination of
contract of sale of the real property is commenced under section
559.21, notice of the mortgage foreclosure or termination of
contract of sale must be mailed to the county treasurer at least
25 days before the foreclosure, sale, or date of termination.
Notice need not be given under this subdivision if the lien has
been filed within 30 days or less before the foreclosure, sale,
or date of termination. The notice must contain the following
information: (1) the name and address of the taxpayer; (2) a
copy of the notice of mortgage foreclosure or contract for deed
cancellation; (3) a copy of the lien filed by the county
treasurer; (4) the total unpaid balance of the mortgage or
contract for deed; and (5) a legal description of the property.
Upon a request of a party providing notice under this
subdivision, the county treasurer shall send to the party within
one business day of receiving the notice a receipt for the
notice.
Subd. 7. [FILING ENTITLEMENT.] Execution of notices of
liens or of other notices affecting personal property tax liens
by the county treasurer or a delegate entitles them to be filed,
and no other attestation, certification, or acknowledgment is
necessary.
Subd. 8. [LIEN SEARCH FEES.] Upon request of a person, the
filing officer shall issue a certificate showing whether there
is on file, on the date and hour stated in the certificate, any
notice of lien or certificate or notice affecting any lien filed
after December 31, 1991, naming a particular person, and giving
the date and hour of filing of each notice or certificate naming
the person. The fee for a certificate is as provided by section
336.9-407 or 357.18, subdivision 1, clause (3). Upon request,
the filing officer shall furnish a copy of any notice of lien,
or notice or certificate affecting a lien, for a fee of $1 per
page.
Sec. 5. [277.21] [LEVY AND DISTRAINT.]
Subdivision 1. [COLLECTION AUTHORITY OF THE COUNTY
TREASURER.] If a tax assessed on personal property or
manufactured homes and collectible under this chapter is not
paid when due, the county treasurer shall, as soon as
practicable, take action the county treasurer considers
necessary and reasonable to collect the delinquent tax. By
mutual agreement, the county treasurer may use the services of
the district court or the central collection unit of the county
to effect collection. In addition, by inclusion and not
limitation, the county treasurer may request a writ of execution
to enforce any tax judgment or may levy and seize property under
authority granted by this section. Taxes may be collected by
the county treasurer within five years after the date of
assessment of the tax, or if a lien has been filed, within the
period the lien is enforceable, or if the tax judgment has been
filed, within the statutory period of enforcement of a valid tax
judgment, by a levy upon all property and rights to property of
the person liable for the payment of the tax. However, the
right to levy does not extend to property that is exempt from
execution under sections 550.37, 550.38, and 550.39, but
manufactured homes otherwise exempt per section 550.37,
subdivision 12, are subject to levy and sale under this
section. The term "levy" includes the power of distraint and
seizure by any means. For this purpose, the term "tax" includes
penalty, interest, and costs properly payable.
Subd. 2. [NOTICE AND DEMAND; JEOPARDY COLLECTION.] At
least 30 days before a levy is made, notice and demand for
payment of the amount due must be given to the person liable for
the payment or collection of the tax. If the county treasurer
has reason to believe that collection of the tax is in jeopardy,
notice and demand for immediate payment of the tax may be made
by the county treasurer. If the tax is not paid, the county
treasurer may proceed to collect by levy without regard to the
30-day period or the due date.
If collection of tax on personal property or manufactured
homes is in jeopardy because of removal from the county or other
reasons before the time that the taxes are calculated for the
property for the current tax year, the county auditor shall
immediately determine the amount of tax by applying the latest
available levy rate and market value and shall notify the county
treasurer of the amount of tax in jeopardy. The county
treasurer may levy and seize the property without regard to
prior notice or due date.
The notice required under this subdivision must be sent to
the taxpayer's last known address and must include a brief
statement that states in simple and nontechnical terms: (1) the
administrative appeals available to the taxpayer with respect to
the levy and sale; and (2) the alternatives available to the
taxpayer that can prevent a levy, including an installment
payment agreement under section 277.23.
Subd. 3. [MANNER OF EXECUTION AND SALE.] In making the
execution of the levy and in collecting the taxes due, the
county treasurer has all of the powers in chapter 550 and in any
other law for purposes of effecting an execution against
property in this state. The sale of property levied upon, and
the time and manner of redemption therefrom, must be consistent
with authority granted to the commissioner of revenue to collect
state taxes under sections 270.70 to 270.709. The seal of the
court, subscribed by the court administrator, as provided in
section 550.04, is not required. The levy for collection of
taxes may be made, whether or not a legal action for collection
of the taxes has been commenced.
Subd. 4. [STAY OF SALE.] (a) Except for a jeopardy
collection under subdivision 2, property shall not be seized for
collection of tax until the time has expired for filing an
appeal of the assessment with the tax court under chapter 277,
or section 274.19 in the case of a manufactured home. If a
jeopardy assessment has been made, the owner may file an appeal
with the tax court within 30 days after the notice of assessment
is issued by the county. The notice shall advise the owner of
the right of appeal. If a timely appeal has been filed, no sale
may be made unless the taxes remain unpaid for a period of more
than 30 days after final determination of the appeal by the tax
court or by the appropriate judicial forum.
(b) Notwithstanding paragraph (a), seized property may be
sold if:
(1) the taxpayer consents in writing to the sale; or
(2) the county treasurer determines that the property is
perishable or may become greatly reduced in price or value by
keeping, or that the property cannot be kept without great
expense.
Subd. 5. [PROBATE COURT JURISDICTION.] If a levy has been
made to collect taxes under this section and the property seized
is properly included in a formal proceeding commenced under
sections 524.3-401 to 524.3-505 and maintained under full
supervision of the court, the property may not be sold until the
probate proceedings are completed or until the court so orders.
Subd. 6. [BOND OR SECURITY TO RELEASE A SEIZURE.] The
property seized must be returned to the owner if the owner gives
a surety bond equal to the appraised value of the owner's
interest in the property, or deposits with the county treasurer
security in a form and amount that is necessary to ensure
payment of the liability, but not more than twice the liability.
Subd. 7. [INJUNCTION.] Notwithstanding any other provision
to the contrary, if a levy or sale under this section would
irreparably injure rights in property that the court determines
to be superior to rights of the taxing districts in the
property, the district court may grant an injunction to prohibit
the enforcement of the levy or to prohibit a sale.
Subd. 8. [PERSONAL LIABILITY.] A person who fails or
refuses to surrender without reasonable cause any property or
rights to property subject to levy, upon demand by the county
treasurer, is personally liable to the treasurer in an amount
equal to the value of the property or rights not so surrendered,
but not exceeding the amount of taxes for the collection of
which the levy has been made. Any amount recovered under this
subdivision must be credited against the tax liability for the
collection of which the levy was made.
Subd. 9. [PENALTY.] In addition to the personal liability
imposed by subdivision 8, if a person required to surrender
property or rights to property fails or refuses to surrender the
property or rights to property without reasonable cause, the
person is liable for a penalty equal to 25 percent of the amount
recoverable under subdivision 8. No part of the penalty may be
credited against the tax liability for the collection of which
the levy was made.
Subd. 10. [PERSON DEFINED.] The term "person" as used in
subdivision 8 includes an officer or employee of a corporation
or a member or employee of a partnership who, as an officer,
employee, or member is under a duty to surrender the property or
rights to property or to discharge the obligation. The county
attorney shall take appropriate action against any person who
has failed to comply with subdivision 8 or 9.
Subd. 11. [OPTIONAL REMEDY.] An action taken by the county
treasurer under this section does not constitute an election to
pursue a remedy to the exclusion of any other remedy.
Subd. 12. [EQUITABLE RELIEF.] Upon the seizure of property
of a person, that person may, upon giving 48-hours notice to the
county treasurer and to the court, bring a claim for equitable
relief before the district court for the release of the property
to the taxpayer upon terms and conditions the court considers
equitable.
Subd. 13. [LEVY AND SALE BY SHERIFF.] If a tax collectible
under this chapter is not paid as provided in subdivision 1 or
2, the county treasurer may, within the time prescribed for
collection in subdivision 1, delegate authority by issuing a
warrant to the sheriff of a county in the state of Minnesota
directing the sheriff as the county treasurer's agent to levy on
and sell the real and personal property of the person liable for
the payment of the tax and to return the warrant and pay to the
county treasurer the money collected within 120 days from the
date of the warrant.
The sheriff shall proceed under authority of the warrant to
levy on and seize any property and rights to property in the
county belonging to the person liable for the payment of the
tax, except that the right to levy and seizure does not extend
to property that is exempt from execution under sections 550.37,
550.38, and 550.39, but manufactured homes otherwise exempt
under section 550.37, subdivision 12, are subject to levy under
this section. The sheriff shall sell so much of the property
levied on as is necessary to satisfy the amount of the warrant
and the sheriff's costs.
Sales procedures, and the time and manner of redemption
from them, must be consistent with the procedures in sections
270.701 to 270.709 for warrants issued by the commissioner of
revenue. The sale proceeds, less the sheriff's costs, must be
turned over to the county treasurer who issued the warrant. The
proceeds must be applied as provided in section 270.708.
Subd. 14. [PRIORITY OF LEVY.] Notwithstanding section
52.12, a levy by the county treasurer made under this section on
a taxpayer's funds on deposit in a financial institution located
in this state, has priority over an unexercised right of setoff
of the financial institution to apply the levied funds toward
the balance of an outstanding loan or loans owed by the taxpayer
to the financial institution. A claim by the financial
institution that it exercised its right to setoff before the
levy must be substantiated by evidence of the date of the
setoff, and must be verified by the sworn statement of a
responsible corporate officer of the financial institution.
Furthermore, for purposes of determining the priority of a levy
made under this section, the levy must be treated as if it were
an execution made under chapter 550.
Subd. 15. [EFFECT OF HONORING LEVY.] A person in
possession of, or obligated with respect to, property or rights
to property subject to levy on which a levy has been made who,
upon demand by the county treasurer or agent, surrenders the
property or rights to property, or pays a liability under
subdivision 8, must be discharged from any obligation or
liability to the person liable for the payment or collection of
the delinquent tax with respect to the property or rights to
property so surrendered or paid.
Subd. 16. [NOTICE OF LEVY.] Notwithstanding any other law
to the contrary, the notice of a levy authorized by this section
may be served by mail or by delivery by an employee or agent of
the county treasurer.
Sec. 6. [277.22] [ADJUSTMENT OF TAX LIABILITY.]
If the amount of tax determined under section 277.21,
subdivision 2, is greater than the corrected tax computed by
applying the proper value and levy rate, the excess must be
refunded to the person paying the tax. If the amount paid is
less, the deficiency must be collected in the same manner as
other personal property taxes not collected.
Sec. 7. [277.23] [CONFESSION OF JUDGMENT FOR HOMESTEAD.]
Subdivision 1. [PROCEDURE.] The owner or another person
having an interest in a manufactured home classified and taxed
as a homestead may confess judgment and pay the delinquent
personal property tax on the manufactured home in installments
in the general manner provided in section 279.37 for real
property tax. The provisions of section 279.37 apply to these
confessions of judgment and installment payments, except as
otherwise provided in this section. A down payment must be
tendered of 20 percent of the amount of taxes, costs, penalty,
and interest accrued to the date of tender. The balance of the
judgment must be paid in four equal annual installments, plus
interest on the unpaid balance as provided in this chapter.
The confession of judgment must be substantially in the
following form:
"To the court administrator of the district court of
........ county:
Name of taxpayer: ..................................
Location of manufactured home (county): ............
Description of property: ...........................
Tax Year Amount due
(start with the most (total of delinquent
recent tax year in taxes, costs, interest,
which you owe taxes) and penalty)
........... ...........
........... ...........
........... ...........
........... ...........
........... ...........
........... ...........
I am the owner of the manufactured home described above.
I offer to confess judgment on the following amount of the
delinquent taxes on the property named above:
Amount to be paid: $.........
I direct the court to enter judgment for that amount.
I waive all irregularities in the tax proceedings affecting
these taxes, and I waive any defense or objection I may have to
them.
I agree to pay 20 percent of the total amount now.
Amount paid now: $.........
I agree to pay the balance of the amount in four equal
annual installments. I agree to pay each installment on or
before December 31 of each year after the year in which I file
this form.
I agree to pay interest as provided in Minnesota Statutes,
chapter 277. I agree that the interest is payable annually on
the installments remaining unpaid.
I agree to pay current taxes each year before they become
delinquent, unless I contest the taxes under Minnesota Statutes,
chapter 277. If I do contest them, I agree to pay the amount
decided by the tax court within 30 days after the court enters
its final judgment in the proceedings.
Date: ..........
Signature of taxpayer: ........"
Upon receipt of the signed confession of judgment and the
required payment, the county treasurer shall file the confession
of judgment with the court administrator of the district court.
When entered by the court administrator, the judgment has the
same force and effect of other civil judgments in personam.
Subd. 2. [BILLING.] The county treasurer shall give notice
by mail before December 1 of each year to the person making a
confession of judgment at the address given in it of the payment
due under the confession on the following December 31. If the
county treasurer has not received the installment payment by
December 31, the treasurer shall give notice by certified mail
at the last known address of the person making the confession of
judgment, without regard to the county or state of the person's
residency. This notice must state that the property is subject
to levy and sale if payment is not made for the preceding
December 31 within 60 days. Failure to send or receive the
notice does not postpone any payment or excuse any default under
the confession of judgment. Proof of mailing must be made by
the certificate of the county treasurer filed in the treasurer's
office.
Subd. 3. [FEES.] The party making a confession of judgment
shall pay the county treasurer a fee as set by the county board
to defray the costs of processing the confession of judgment and
making the annual billings required. Fees as set by the county
board must be paid to the court administrator of the court for
entry of judgment and for the entry of each full or partial
release of the confession of judgment. Fees must be credited to
the general revenue fund of the county.
Sec. 8. [277.24] [UNCOLLECTED TAXES.]
If at any time in the collection proceedings the county
treasurer is satisfied that the tax cannot be collected for any
reason or finds that the collection costs are excessive in
comparison to the amount of tax involved, the treasurer may
cancel the taxes due. A list of canceled taxes must be kept by
the treasurer for a period of six years. The list must identify
the taxpayer, the amount of uncollectible liability, and the
reason for uncollectibility.
Sec. 9. [STUDY.]
The department of revenue shall study the issue of taxation
of manufactured homes and report its specific recommendations to
the legislature by March 1, 1993. The study shall include a
review of the tax escrow requirements in section 1, and
recommendations on the creation and enforcement of tax liens on
manufactured homes. The department shall consult with the
appropriate committees of the legislature and the Minnesota
state bar association in conducting this study.
Sec. 10. [REPEALER.]
Minnesota Statutes 1990, sections 272.50; 272.51; 272.52;
272.53; 277.02; 277.03; 277.05; 277.06; 277.07; 277.08; 277.09;
277.10; 277.11; 277.12; and 277.13, are repealed.
Sec. 11. [EFFECTIVE DATE.]
Section 2 is effective for taxes payable in 1992 and
thereafter. Section 3 is effective for taxes becoming
delinquent in 1992 and thereafter.
Sections 4 to 8 and 10 are effective January 1, 1992, but
the liens shall be enforceable only for taxes payable after
January 1, 1992. A levy authorized by this article may be made
to collect any tax remaining unpaid on the effective date,
whether or not the tax is included in a judgment. Liens arising
under Minnesota Statutes, section 272.50, shall remain in force
until taxes are paid, notwithstanding repeal of Minnesota
Statutes, section 272.50.
ARTICLE 16
COLLECTIONS
Section 1. Minnesota Statutes 1990, section 270.274,
subdivision 1, is amended to read:
Subdivision 1. [ADMINISTRATIVE REVIEW.] Within five days
after a jeopardy assessment or jeopardy collection is made to
assess or collect a tax administered by the commissioner of
revenue, the commissioner shall provide the taxpayer with a
written statement of the information relied on in making the
assessment or levy. Within 30 days after the written statement
is provided or, if not provided, within 35 days after the
assessment or levy, the taxpayer may request the commissioner to
review the action taken. After a request for review, the
commissioner shall determine whether the assessment or levy is
reasonable and whether the amount assessed or demanded as a
result of the action is appropriate under the circumstances.
Sec. 2. Minnesota Statutes 1990, section 270.66,
subdivision 3, is amended to read:
Subd. 3. [AGENCIES SHALL MAINTAIN RECORDS.]
Notwithstanding any provision to the contrary, every person,
organization, or corporation doing business (hereafter called
vendor) with the state of Minnesota or any of its departments,
agencies, or educational institutions including the University
of Minnesota (all hereafter called agency) shall provide that
agency with either their social security number, federal
taxpayer identification number, or Minnesota tax identification
number. The agency shall maintain records of this information,
and shall make these records available, on request, to the
commissioner for the sole purpose of identifying people who have
not filed state tax returns or who have not paid uncontested
state tax liabilities (hereafter called delinquent taxpayer).
When an agency is notified by the commissioner that a vendor is
a delinquent taxpayer, payments shall not be made by the agency
to the vendor until the commissioner notifies the agency that
the vendor no longer is a delinquent taxpayer. Furthermore, if
the vendor has an uncontested delinquent tax liability, the
setoff provided in subdivision 1 may be implemented. The
commissioner shall determine that a vendor no longer is a
delinquent taxpayer when the vendor has filed all delinquent
state tax returns, paid all uncontested state tax liabilities or
entered into an agreement with the commissioner which provides
for the payment of these liabilities.
Sec. 3. Minnesota Statutes 1990, section 270.68,
subdivision 1, is amended to read:
Subdivision 1. [LEGAL ACTION.] In addition to all other
methods authorized by law for the collection of tax, if any tax
payable to the commissioner of revenue or to the department of
revenue, including penalties and interest thereon, is not paid
within 60 days after it is required by law to be paid, the
commissioner of revenue may proceed under this subdivision.
Within five years after the date of assessment of the tax, or,
if the action is to renew or enforce a judgment, at any time
before the judgment's expiration, the commissioner may bring an
action at law against the person liable for the payment or
collection of the tax, in the name of the state, for the
recovery of the tax and interest and penalties due in respect
thereof. The action shall be brought in the district court of
the judicial district in which lies the county of the residence
or principal place of business within this state of the
taxpayer, or, in the case of an estate or trust, of the place of
its principal administration, and for this purpose the place
named as such in the return, if any, made by the taxpayer shall
be conclusive against the taxpayer in this matter. If no place
is named in the return, the action may be commenced in Ramsey
county. The action shall be commenced by filing with the court
administrator a statement showing the name and address of the
taxpayer, if known, an itemized summary of the taxable periods
and the type of tax, the tax due and unpaid and the interest and
penalties due with respect thereto under the provisions of law
applicable to the tax, and shall contain a prayer that the court
adjudge the taxpayer to be indebted on account of the taxes,
interest, and penalties in the amount specified in the
statement; a copy of the statement shall be furnished to the
court administrator therewith. The court administrator shall
mail a copy of the statement by certified mail to the taxpayer
at the address given in the return, if any; and to the
taxpayer's last known address, within five days after the same
is filed, except that, if the taxpayer's address is not known,
notice shall be made by posting a copy of the statement for ten
days in the place in the courthouse where public notices are
regularly posted. To litigate the claim, or any part of it, the
taxpayer shall serve an answer upon the commissioner on or
before the 20th day after the date of mailing the statement; or,
if notice has been given by posting, on or before the 20th day
after the expiration of the period during which the notice was
required to be posted. If no answer is served within the
specified time, the court administrator, upon the filing of an
affidavit of default, shall enter judgment for the state in the
amount prayed for, plus costs of $10. If an answer is filed,
the issues raised shall stand for trial as soon as possible
after the filing of the answer, and the court shall determine
the issues and direct judgment accordingly; and, if the taxes,
interest, or penalties are sustained to any extent over the
amount rendered by the taxpayer, shall assess $10 costs against
the taxpayer. The court shall disregard all technicalities and
matters of form not affecting the substantial merits. The
commissioner may call upon the county attorney or the attorney
general to conduct the proceedings on behalf of the state. If a
proceeding is referred to a county attorney, and the county
attorney fails to issue or cause to be issued an indictment or
criminal complaint within 30 days after the referral by the
commissioner, the attorney general may conduct the proceeding.
Execution shall be issued upon the judgment at the request of
the commissioner, and the execution shall, in all other
respects, be governed by the laws applicable to executions
issued on judgments. Only the homestead and household goods of
the judgment debtor shall be exempt from seizure and sale upon
the execution.
In addition to the procedure in this subdivision, legal
action may be commenced by the commissioner in district court in
the same manner or venue as any other civil action.
Sec. 4. Minnesota Statutes 1990, section 270.69, is
amended by adding a subdivision to read:
Subd. 13. [FORTY-FIVE DAY RULE.] A notice of tax lien
filed under this section has priority over a security interest
arising under article 9 of the Uniform Commercial Code, codified
as sections 336.9-101 to 336.9-508, that is perfected before the
date of filing of the lien imposed by this section, but only if:
(1) the perfected security interest secures property
acquired by the taxpayer or advances made by the secured party
after the notice of tax lien is filed; and
(2) the property is acquired or the advance is made after
the 45th day following the day on which the notice of tax lien
is filed, or after the secured party has actual notice or
knowledge of the tax lien filing, whichever is earlier.
Sec. 5. Minnesota Statutes 1990, section 270.70,
subdivision 10, is amended to read:
Subd. 10. [PERSON DEFINED.] The term "person" as used in
subdivision 8 includes an officer or employee of a corporation
or a member or employee of a partnership who, as such officer,
employee or member is under a duty to surrender the property or
rights to property or to discharge the obligation. The personal
liability imposed by subdivision 8 and the penalty imposed by
subdivision 9 may, after demand to honor a levy has been made,
be assessed by the commissioner within 60 days after service of
the levy demand. An assessing tax order under this subdivision
shall be appealable to the tax court without payment of the tax,
penalty, or interest in the manner provided by law, but an
appeal shall not preclude the commissioner from exercising any
collection action the commissioner deems necessary to preserve
the interests of the state while the matter is pending.
Sec. 6. Minnesota Statutes 1990, section 270.703,
subdivision 2, is amended to read:
Subd. 2. [REDEMPTION OF REAL ESTATE AFTER SALE.] The
owners of any real property sold as provided in this section,
their heirs, executors, or administrators, or any person having
any interest therein, or a lien thereon, or any person in their
behalf, shall be permitted to redeem the property sold, or any
particular tract of the property, at any time within 6 months,
or in case the real property sold exceeds 10 acres in size, at
any time within 12 months, after the sale thereof. The property
or tract of property shall be permitted to be redeemed upon
payment to the purchaser (or if not found in the county in which
the property to be redeemed is situated, then to the
commissioner, for the use of the purchaser, or the purchaser's
heirs or assigns) of the amount paid by the purchaser together
with interest at the rate specified in section 549.09 from the
date of the sale 20 percent per annum.
Sec. 7. Minnesota Statutes 1990, section 270.75,
subdivision 4, is amended to read:
Subd. 4. There shall be added to the amount of any
underpayment of estimated income tax, computed pursuant to
chapter 290 289A, an amount in lieu of interest. The amount in
lieu of interest for that taxable year shall be the amount
determined in subdivision 5 for January 1 on which begins the
taxable year or precedes the beginning of the taxable year. The
amount in lieu of interest does not bear interest after the due
date of the return for that taxable year.
Sec. 8. Minnesota Statutes 1990, section 289A.37,
subdivision 1, is amended to read:
Subdivision 1. [ORDER OF ASSESSMENT; NOTICE AND DEMAND TO
TAXPAYER.] (a) When a return has been filed and the commissioner
determines that the tax disclosed by the return is different
than the tax determined by the examination, the commissioner
shall send an order of assessment to the taxpayer. When no
return has been filed, the commissioner may make a return for
the taxpayer under section 289A.35 or may send an order of
assessment under this subdivision. The order must explain the
basis for the assessment and must explain the taxpayer's appeal
rights. An order of assessment is final when made but may be
reconsidered by the commissioner under section 289A.65.
(b) An amount of unpaid tax shown on the order must be paid
to the commissioner: (1) within 60 days after notice of the
amount and demand for its payment have been mailed to the
taxpayer by the commissioner; or (2) if an administrative appeal
is filed under section 289A.65, within 60 days following the
determination of the appeal.
Sec. 9. Minnesota Statutes 1990, section 289A.42,
subdivision 1, is amended to read:
Subdivision 1. [EXTENSION AGREEMENT.] If before the
expiration of time prescribed in sections 289A.38 and 289A.40
for the assessment of tax or the filing of a claim for refund,
both the commissioner and the taxpayer have consented in writing
to the assessment or filing of a claim for refund after that
time, the tax may be assessed or the claim for refund filed at
any time before the expiration of the agreed upon period. The
period may be extended by later agreements in writing before the
expiration of the period previously agreed upon. The taxpayer
and the commissioner may also agree to extend the period for
collection of the tax.
Sec. 10. Minnesota Statutes 1990, section 289A.60, is
amended by adding a subdivision to read:
Subd. 20. [PENALTY FOR PROMOTING ABUSIVE TAX SHELTERS.]
Any person who:
(1)(i) organizes or assists in the organization of a
partnership or other entity, an investment plan or arrangement,
or any other plan or arrangement, or (ii) participates in the
sale of any interest in an entity or plan or arrangement
referred to in clause (i); and
(2) makes or furnishes in connection with the organization
or sale a statement with respect to the allowability of a
deduction or credit, the excludability of income, or the
securing of any other tax benefit by reason of holding an
interest in the entity or participating in the plan or
arrangement that the person knows or has reason to know is false
or fraudulent concerning any material matter, shall pay a
penalty equal to the greater of $1,000 or 20 percent of the
gross income derived or to be derived by the person from the
activity.
The penalty imposed by this subdivision is in addition to
any other penalty provided by this section. The penalty must be
collected in the same manner as any delinquent income tax. In a
proceeding involving the issue of whether or not any person is
liable for this penalty, the burden of proof is upon the
commissioner.
Sec. 11. Minnesota Statutes 1990, section 290.92, is
amended by adding a subdivision to read:
Subd. 6b. [JEOPARDY ASSESSMENTS.] The commissioner, on
having reason to believe that the collection of the tax under
this section, section 290.923, or chapter 289A will be
jeopardized by delay, may immediately assess the tax, whether or
not the time prescribed by law for making and filing the return
and paying the tax has expired.
Sec. 12. [REPEALER.]
Minnesota Statutes 1990, sections 290.48, subdivisions 5
and 8; and 297A.39, subdivision 9, are repealed.
Sec. 13. [EFFECTIVE DATES.]
Sections 1, 2, 5, 7 to 10, and 12 are effective the day
following final enactment.
Sections 3 and 11 are effective on the effective date of
Laws 1990, chapter 480, article 1, section 45, in order that
repealed provisions authorizing ordinary civil actions for the
collection of taxes and jeopardy withholding tax assessments are
replaced, with no lapse in time during which the repealed
provisions and these sections are enforceable.
Section 4 is effective for liens filed on or after July 1,
1991.
Section 6 is effective for sales of seized property on or
after August 1, 1991.
ARTICLE 17
ELECTRONIC FUNDS TRANSFERS
Section 1. Minnesota Statutes 1990, section 115B.24,
subdivision 2, is amended to read:
Subd. 2. [DECLARATIONS OF ESTIMATED TAX.] For 1983, every
generator of hazardous waste required to pay a tax pursuant to
section 115B.22 shall make a declaration of estimated hazardous
waste generated for the last six months of calendar year 1983 if
the tax can reasonably be estimated to exceed $500. The
declaration of the estimated tax shall be filed by October 15,
1983. The amount of estimated tax with respect to which a
declaration is required shall be paid in two equal installments
by October 15, 1983 and January 15, 1984. For 1984 and
subsequent years, every generator of hazardous waste required to
pay a tax pursuant to section 115B.22 shall make a declaration
of estimated hazardous waste generated for the calendar year if
the tax can reasonably be expected to be in excess of $1,000.
The declaration of estimated tax shall be filed by March 15.
The amount of estimated tax with respect to which a declaration
is required shall be paid in four equal installments on or
before the 15th day of March, June, September, and December.
An amendment of a declaration may be filed in any interval
between installment dates prescribed above but only one
amendment may be filed in each interval. If an amendment of a
declaration is filed, the amount of each remaining installment
shall be the amount which would have been payable if the new
estimate had been made when the first estimate for the calendar
year was made, increased or decreased, as the case may be, by
the amount computed by dividing
(1) the difference between (A) the amount of estimated tax
required to be paid before the date on which the amendment was
made, and (B) the amount of estimated tax which would have been
required to be paid before that date if the new estimate had
been made when the first estimate was made, by
(2) the number of installments remaining to be paid on or
after the date on which the amendment is made.
The commissioner of revenue may grant a reasonable
extension of time for filing any declaration but the extension
shall not be for more than six months.
If the aggregate amount of estimated tax payments made
during a fiscal year ending June 30 is equal to or exceeds
$80,000, all estimated tax payments in the subsequent calendar
year must be paid by means of a funds transfer as defined in
section 336.4A-104, paragraph (a). The funds transfer payment
date, as defined in section 336.4A-401, must be on or before the
date the estimated tax payment is due. If the date the
estimated tax payment is due is not a funds transfer business
day, as defined in section 336.4A-105, paragraph (a), clause
(4), the payment date must be on or before the funds transfer
business day next following the date the estimated tax payment
is due.
Sec. 2. Minnesota Statutes 1990, section 289A.20,
subdivision 1, is amended to read:
Subdivision 1. [INDIVIDUAL INCOME, FIDUCIARY INCOME,
CORPORATE FRANCHISE, AND ENTERTAINMENT TAXES.] (a) Individual
income, fiduciary, and corporate franchise taxes must be paid to
the commissioner on or before the date the return must be filed
under section 289A.18, subdivision 1, or the extended due date
as provided in section 289A.19, unless an earlier date for
payment is provided.
Notwithstanding any other law, a taxpayer whose unpaid
liability for income or corporate franchise taxes, as reflected
upon the return, is $1 or less need not pay the tax.
A corporation required to make estimated tax payments by
means of an electronic funds transfer must also make the payment
with the return in accordance with section 289A.26, subdivision
2a.
(b) Entertainment taxes must be paid on or before the date
the return must be filed under section 289A.18, subdivision 1.
Sec. 3. Minnesota Statutes 1990, section 289A.20,
subdivision 2, is amended to read:
Subd. 2. [WITHHOLDING FROM WAGES, ENTERTAINER WITHHOLDING,
WITHHOLDING FROM PAYMENTS TO OUT-OF-STATE CONTRACTORS, AND
WITHHOLDING BY PARTNERSHIPS AND SMALL BUSINESS CORPORATIONS.]
(a) A tax required to be deducted and withheld during the
quarterly period must be paid on or before the last day of the
month following the close of the quarterly period, unless an
earlier time for payment is provided. A tax required to be
deducted and withheld from compensation of an entertainer and
from a payment to an out-of-state contractor must be paid on or
before the date the return for such tax must be filed under
section 289A.18, subdivision 2. Taxes required to be deducted
and withheld by partnerships and S corporations must be paid on
or before the date the return must be filed under section
289A.18, subdivision 2.
(b)(1) Unless clause (2) applies, if during any calendar
month, other than the last month of the calendar quarter, the
aggregate amount of the tax withheld during that quarter under
section 290.92, subdivision 2a or 3, or 290.923, subdivision 2,
exceeds $500, the employer shall deposit the aggregate amount
with the commissioner within 15 days after the close of the
calendar month. (2) If at the close of any eighth-monthly
period the aggregate amount of undeposited taxes is $3,000 or
more, the employer, or person withholding tax under section
290.92, subdivision 2a or 3, or 290.923, subdivision 2, shall
deposit the undeposited taxes with the commissioner within three
banking days after the close of the eighth-monthly period. For
purposes of this clause, the term "eighth-monthly period" means
the first three days of a calendar month, the fourth day through
the seventh day of a calendar month, the eighth day through the
11th day of a calendar month, the 12th day through the 15th day
of a calendar month, the 16th day through the 19th day of a
calendar month, the 20th day through the 22nd day of a calendar
month, the 23rd day through the 25th day of a calendar month, or
the part of a calendar month following the 25th day of the month.
(c) The commissioner may prescribe by rule other return
periods or deposit requirements. In prescribing the reporting
period, the commissioner may classify payors according to the
amount of their tax liability and may adopt an appropriate
reporting period for the class that the commissioner judges to
be consistent with efficient tax collection. In no event will
the duration of the reporting period be more than one year.
(d) If less than the correct amount of tax is paid to the
commissioner, proper adjustments with respect to both the tax
and the amount to be deducted must be made, without interest, in
the manner and at the times the commissioner prescribes. If the
underpayment cannot be adjusted, the amount of the underpayment
will be assessed and collected in the manner and at the times
the commissioner prescribes.
(e) If the aggregate amount of the tax withheld during a
fiscal year ending June 30 under section 290.92, subdivision 2a
or 3, is equal to or exceeds $240,000, the employer must remit
each required deposit in the subsequent calendar year by means
of a funds transfer as defined in section 336.4A-104, paragraph
(a). The funds transfer payment date, as defined in section
336.4A-401, must be on or before the date the deposit is due.
If the date the deposit is due is not a funds transfer business
day, as defined in section 336.4A-105, paragraph (a), clause
(4), the payment date must be on or before the funds transfer
business day next following the date the deposit is due.
Sec. 4. Minnesota Statutes 1990, section 289A.20,
subdivision 4, is amended to read:
Subd. 4. [SALES AND USE TAX.] (a) The taxes imposed by
chapter 297A are due and payable to the commissioner monthly on
or before the 20th day of the month following the month in which
the taxable event occurred or following another reporting period
as the commissioner prescribes.
(b) A vendor having a liability of $1,500 or more in May of
a year must remit the June liability in the following manner:
(1) On or before June 20 of the year, the vendor must remit
the actual May liability and one-half of the estimated June
liability to the commissioner.
(2) On or before August 20 of the year, the vendor must pay
any additional amount of tax not remitted in June.
(c) When a retailer located outside of a city that imposes
a local sales and use tax collects use tax to be remitted to
that city, the retailer is not required to remit the tax until
the amount collected reaches $10.
(d) A vendor having a liability of $240,000 or more during
a fiscal year ending June 30 must remit all liabilities in the
subsequent calendar year by means of a funds transfer as defined
in section 336.4A-104, paragraph (a). The funds transfer
payment date, as defined in section 336.4A-401, must be on or
before the date the tax is due. If the date the tax is due is
not a funds transfer business day, as defined in section
336.4A-105, paragraph (a), clause (4), the payment date must be
on or before the funds transfer business day next following the
date the tax is due.
Sec. 5. Minnesota Statutes 1990, section 289A.26, is
amended by adding a subdivision to read:
Subd. 2a. [ELECTRONIC FUNDS TRANSFER PAYMENTS.] If the
aggregate amount of estimated tax payments made during a
calendar year is equal to or exceeds $80,000, all estimated tax
payments in the subsequent calendar year must be paid by means
of a funds transfer as defined in section 336.4A-104, paragraph
(a). The funds transfer payment date, as defined in section
336.4A-401, must be on or before the date the estimated tax
payment is due. If the date the estimated tax payment is due is
not a funds transfer business day, as defined in section
336.4A-105, paragraph (a), clause (4), the payment date must be
on or before the funds transfer business day next following the
date the estimated tax payment is due.
Sec. 6. Minnesota Statutes 1990, section 296.14,
subdivision 1, is amended to read:
Subdivision 1. [CONTENTS; PAYMENT OF TAX; SHRINKAGE
ALLOWANCE.] On or before the 23rd day of each month, every
person who is required to pay gasoline tax or inspection fee on
petroleum products and every distributor shall file in the
office of the commissioner at St. Paul, Minnesota, a report in a
manner approved by the commissioner showing the number of
gallons of petroleum products received by the reporter during
the preceding calendar month, and such other information as the
commissioner may require. The number of gallons of gasoline
shall be reported in United States standard liquid gallons (231
cubic inches), except that the commissioner may upon written
application therefor and for cause shown permit the distributor
to report the number of gallons of such gasoline as corrected to
a 60 degree Fahrenheit temperature. If such application is
granted, all gasoline covered in such application and as allowed
by the commissioner must continue to be reported by the
distributor on the adjusted basis for a period of one year from
the date of the granting of the application. The number of
gallons of petroleum products other than gasoline shall be
reported as originally invoiced.
Each report shall show separately the number of gallons of
aviation gasoline received by the reporter during such calendar
month.
Each report shall be accompanied by remittance covering
inspection fees on petroleum products and gasoline tax on
gasoline received by the reporter during the preceding month;
provided that in computing such tax a deduction of three percent
of the quantity of gasoline received by a distributor shall be
made for evaporation and loss; provided further that at the time
of remittance the distributor shall submit satisfactory evidence
that one-third of such three percent deduction shall have been
credited or paid to dealers on quantities sold to them. The
report and remittance shall be deemed to have been filed as
herein required if postmarked on or before the 23rd day of the
month in which payable.
Each report shall contain a confession of judgment for the
amount of the tax shown due thereon to the extent not timely
paid.
If the aggregate remittances made during a fiscal year
ending June 30 equal or exceed $240,000, all remittances in the
subsequent calendar year must be made by means of a funds
transfer as defined in section 336.4A-104, paragraph (a). The
funds transfer payment date, as defined in section 336.4A-401,
must be on or before the date the remittance is due. If the
date the remittance is due is not a funds transfer business day,
as defined in section 336.4A-105, paragraph (a), clause (4), the
payment date must be on or before the funds transfer business
day next following the date the remittance is due.
Sec. 7. Minnesota Statutes 1990, section 297.03,
subdivision 6, is amended to read:
Subd. 6. [TAX METER MACHINES; STAMPING MACHINES.] (a)
Before July 1, 1990, the commissioner may authorize any person
licensed as a distributor to stamp packages with a tax meter
machine, approved by the commissioner, which shall be provided
by the distributor. The commissioner may provide for the use of
such a machine by the distributor, supervise and check its
operation, provide for the payment of the tax on any package so
stamped, subject to the discount provided in subdivision 5.
(b) After June 30, 1990, the commissioner shall require any
person licensed as a distributor to stamp packages with a
heat-applied tax stamping machine, approved by the commissioner,
which shall be provided by the distributor. The commissioner
shall supervise and check the operation of the machines and
shall provide for the payment of the tax on any package so
stamped, subject to the discount provided in subdivision 5. The
commissioner may sell heat-applied stamps on a credit basis
under conditions prescribed by the commissioner. The stamps
shall be sold by the commissioner at a price which includes the
tax after giving effect to the discount provided in subdivision
5. The commissioner shall recover the actual costs of the
stamps from the distributor. A distributor having a liability
of $240,000 or more during a fiscal year ending June 30 must
remit all liabilities purchased on a credit basis in the
subsequent calendar year by means of a funds transfer as defined
in section 336.4A-104, paragraph (a). The funds transfer
payment date, as defined in section 336.4A-401, must be on or
before the date the tax is due. If the date the tax is due is
not a funds transfer business day, as defined in section
336.4A-105, paragraph (a), clause (4), the payment date must be
on or before the funds transfer business day next following the
date the tax is due.
(c) If the commissioner finds that a stamping machine is
not affixing a legible stamp on the package, the commissioner
may order the distributor to immediately cease the stamping
process until the machine is functioning properly.
(d) The commissioner shall annually establish the maximum
amount of heat applied stamps that may be purchased each month.
Notwithstanding any other provisions of this chapter, the tax
due on the return will be based upon actual heat applied stamps
purchased during the reporting period.
Sec. 8. Minnesota Statutes 1990, section 297.35,
subdivision 1, is amended to read:
Subdivision 1. On or before the 18th day of each calendar
month every distributor with a place of business in this state
shall file a return with the commissioner showing the quantity
and wholesale sales price of each tobacco product (1) brought,
or caused to be brought, into this state for sale; and (2) made,
manufactured, or fabricated in this state for sale in this
state, during the preceding calendar month. Every licensed
distributor outside this state shall in like manner file a
return showing the quantity and wholesale sales price of each
tobacco product shipped or transported to retailers in this
state to be sold by those retailers, during the preceding
calendar month. Returns shall be made upon forms furnished and
prescribed by the commissioner and shall contain such other
information as the commissioner may require. Each return shall
be accompanied by a remittance for the full tax liability shown
therein, less 1.5 percent of such liability as compensation to
reimburse the distributor for expenses incurred in the
administration of sections 297.31 to 297.39.
A distributor having a liability of $240,000 or more during
a calendar year must remit all liabilities in the subsequent
fiscal year ending June 30 by means of a funds transfer as
defined in section 336.4A-104, paragraph (a). The funds
transfer payment date, as defined in section 336.4A-401, must be
on or before the date the tax is due. If the date the tax is
due is not a funds transfer business day, as defined in section
336.4A-105, paragraph (a), clause (4), the payment date must be
on or before the funds transfer business day next following the
date the tax is due.
Sec. 9. Minnesota Statutes 1990, section 297C.03,
subdivision 1, is amended to read:
Subdivision 1. [MANNER AND TIME OF PAYMENT; PENALTIES;
DEPOSIT OF TAX PROCEEDS.] The tax on wines and distilled spirits
on which the excise tax has not been previously paid must be
paid to the commissioner by persons liable for the tax on or
before the 18th day of the month following the month in which
the first sale is made in this state by a licensed manufacturer
or wholesaler. Every person liable for the tax on wines or
distilled spirits imposed by section 297C.02 must file with the
commissioner on or before the 18th day of the month following
first sale in this state by a licensed manufacturer or
wholesaler a return in the form prescribed by the commissioner,
and must keep records and render reports required by the
commissioner. The commissioner may certify to the commissioner
of public safety any failure to pay taxes when due as a
violation of a statute relating to the sale of intoxicating
liquor for possible revocation or suspension of license.
A person liable for an excise tax of $240,000 or more
during a fiscal year ending June 30 must remit all excise tax
liabilities in the subsequent calendar year by means of a funds
transfer as defined in section 336.4A-104, paragraph (a). The
funds transfer payment date, as defined in section 336.4A-401,
must be on or before the date the excise tax is due. If the
date the excise tax is due is not a funds transfer business day,
as defined in section 336.4A-105, paragraph (a), clause (4), the
payment date must be on or before the funds transfer business
day next following the date the excise tax is due.
Sec. 10. Minnesota Statutes 1990, section 297C.04, is
amended to read:
297C.04 [PAYMENT OF TAX; MALT LIQUOR.]
The commissioner may by rule provide a reporting method for
paying and collecting the excise tax on fermented malt
beverages. The tax is imposed upon the first sale or
importation made in this state by a licensed brewer or
importer. The rules must require reports to be filed with and
the excise tax to be paid to the commissioner on or before the
18th day of the month following the month in which the
importation into or the first sale is made in this state,
whichever first occurs. The rules must also require payments in
June of 1987 and subsequent years according to the provisions of
section 297C.05, subdivision 2.
A distributor who has title to or possession of fermented
malt beverages upon which the excise tax has not been paid and
who knows that the tax has not been paid, shall file a return
with the commissioner on or before the 18th day of the month
following the month in which the distributor obtains title or
possession of the fermented malt beverages. The return must be
made on a form furnished and prescribed by the commissioner, and
must contain all information that the commissioner requires.
The return must be accompanied by a remittance for the full
unpaid liability shown on it.
A licensed brewer, importer, or distributor having an
excise tax liability of $240,000 or more during a fiscal year
ending June 30 must remit all excise tax liabilities in the
subsequent calendar year by means of a funds transfer as defined
in section 336.4A-104, paragraph (a). The funds transfer
payment date, as defined in section 336.4A-401, must be on or
before the date the excise tax is due. If the date the excise
tax is due is not a funds transfer business day, as defined in
section 336.4A-105, paragraph (a), clause (4), the payment date
must be on or before the funds transfer business day next
following the date the excise tax is due.
Sec. 11. Minnesota Statutes 1990, section 349.212,
subdivision 4, is amended to read:
Subd. 4. [PULL-TAB AND TIPBOARD TAX.] (a) There is imposed
a tax on the sale of each deal of pull-tabs and tipboards sold
by a licensed distributor. The rate of the tax is two percent
of the ideal gross of the pull-tab or tipboard deal. The sales
tax imposed by chapter 297A on the sale of the pull-tabs and
tipboards by the licensed distributor is imposed on the retail
sales price less the tax imposed by this subdivision. The
retail sale of pull-tabs or tipboards by the organization is
exempt from taxes imposed by chapter 297A and is exempt from all
local taxes and license fees except a fee authorized under
section 349.16, subdivision 4.
(b) The liability for the tax imposed by this section is
incurred when the pull-tabs and tipboards are delivered by the
distributor to the customer, to a common or contract carrier for
delivery to the customer, or when received by the customer's
authorized representative at the distributor's place of
business, regardless of the distributor's method of accounting
or the terms of the sale.
The tax imposed by this subdivision is imposed on all sales
of pull-tabs and tipboards, except the following:
(1) sales to the governing body of an Indian tribal
organization for use on an Indian reservation;
(2) sales to distributors licensed under this chapter;
(3) sales to distributors licensed under the laws of
another state or of a province of Canada, as long as all
statutory and regulatory requirements are met in the other state
or province; and
(4) sales of promotional tickets as defined in section
349.12.
(c) Pull-tabs and tipboards sold to an organization that
sells pull-tabs and tipboards under the exemption from licensing
in section 349.214, subdivision 2, paragraph (b), are exempt
from the tax imposed by this subdivision. A distributor must
require an organization conducting exempt gambling to show proof
of its exempt status before making a tax-exempt sale of
pull-tabs or tipboards to such an organization. A distributor
shall identify, on all reports submitted to the commissioner,
all sales of pull-tabs and tipboards that are exempt from tax
under this subdivision.
(d) A distributor having a liability of $240,000 or more
during a fiscal year ending June 30 must remit all liabilities
in the subsequent calendar year by means of a funds transfer as
defined in section 336.4A-104, paragraph (a). The funds
transfer payment date, as defined in section 336.4A-401, must be
on or before the date the tax is due. If the date the tax is
due is not a funds transfer business day, as defined in section
336.4A-105, paragraph (a), clause (4), the payment date must be
on or before the funds transfer business day next following the
date the tax is due.
Sec. 12. Minnesota Statutes 1990, section 473.843,
subdivision 3, is amended to read:
Subd. 3. [PAYMENT OF FEE.] On or before the 20th day of
each month each operator shall pay the fee due under this
section for the previous month, using a form provided by the
commissioner of revenue.
An operator having a fee of $240,000 or more during a
fiscal year ending June 30 must pay all fees in the subsequent
calendar year by means of a funds transfer as defined in section
336.4A-104, paragraph (a). The funds transfer payment date, as
defined in section 336.4A-401, must be on or before the date the
fee is due. If the date the fee is due is not a funds transfer
business day, as defined in section 336.4A-105, paragraph (a),
clause (4), the payment date must be on or before the funds
transfer business day next following the date the fee is due.
Sec. 13. [EFFECTIVE DATE.]
Sections 1 to 12 are effective for payments due in the
calendar year beginning January 1, 1992, based upon payments
made in the fiscal year ending June 30, 1991.
ARTICLE 18
UNIFORM RECORDING OF STATE AND FEDERAL TAX LIENS
Section 1. Minnesota Statutes 1990, section 268.161,
subdivision 1, is amended to read:
Subdivision 1. [LIEN.] (a) Any contributions, benefit
overpayments, or reimbursements due under this chapter and
interest and penalties imposed with respect thereto, shall
become a lien upon all the property, within this state, both
real and personal, of the person liable therefor, from the date
of assessment of the contribution, benefit overpayment, or
reimbursement. The term "date of assessment" means the date a
report was due or the payment due date of the notice of benefits
charged to a reimbursable account.
(b)(1) The lien imposed by this section is not enforceable
against any purchaser, mortgagee, pledgee, holder of a uniform
commercial code security interest, mechanic's lien, or judgment
lien creditor, until a notice of lien has been filed by the
commissioner in the office of the county recorder of the county
in which the property is situated, or in the case of personal
property belonging to an individual who is not a resident of the
state, or which is a corporation, partnership, or other
organization, in the office of the secretary of state. When the
filing of the notice of lien is made in the office of the county
recorder, the fee for filing and indexing shall be as prescribed
in sections 272.483 and 272.484.
(2) Notices of liens, lien renewals, and lien releases, in
a form prescribed by the commissioner of jobs and training, may
be filed with the county recorder or the secretary of state by
mail, personal delivery, or by electronic transmission by the
commissioner or a delegate into the computerized filing system
of the secretary of state authorized under section 336.9-411.
The secretary of state shall transmit the notice electronically
to the office of the county recorder, if that is the place of
filing, in the county or counties shown on the computer entry.
The filing officer, whether the county recorder or the secretary
of state, shall endorse and index a printout of the notice in
the same manner as if the notice had been mailed or delivered.
(3) County recorders and the secretary of state shall enter
information relative to lien notices, renewals, and releases
filed in their offices into the central data base of the
secretary of state. For notices filed electronically with the
county recorders, the date and time of receipt of the notice and
county recorder's file number, and for notices filed
electronically with the secretary of state, the secretary of
state's recording information, must be entered by the filing
officer into the central data base before the close of the
working day following the day of the original data entry by the
department of jobs and training.
(c) The lien imposed on personal property by this section,
even though properly filed, is not enforceable against a
purchaser with respect to tangible personal property purchased
at retail or as against the personal property listed as exempt
in sections 550.37, 550.38 and 550.39.
(d) A notice of tax lien filed pursuant to this section has
priority over any security interest arising under chapter 336,
article 9, which is perfected prior in time to the lien imposed
by this section, but only if:
(1) the perfected security interest secures property not in
existence at the time the notice of tax lien is filed; and
(2) the property comes into existence after the 45th day
following the day on which the notice of tax lien is filed, or
after the secured party has actual notice or knowledge of the
tax lien filing, whichever is earlier.
(e) The lien imposed by this section shall be enforceable
from the time the lien arises and for ten years from the date of
filing the notice of lien. A notice of lien may be renewed by
the commissioner before the expiration of the ten-year period
for an additional ten years. The delinquent employer must
receive notice of the renewal.
(f) The lien imposed by this section shall be enforceable
by levy as authorized in subdivision 8 or by judgment lien
foreclosure as authorized in chapter 550.
Sec. 2. Minnesota Statutes 1990, section 270.69,
subdivision 2, is amended to read:
Subd. 2. [FILING OF LIENS NECESSARY FOR ENFORCEABILITY
AGAINST CERTAIN PERSONS; METHODS OF FILING; FEES.] (a) The lien
imposed by subdivision 1 is not enforceable against any
purchaser, mortgagee, pledgee, holder of a uniform commercial
code security interest, mechanic's lienor, or judgment lien
creditor whose interest has been duly perfected or is entitled
to protection under applicable provisions of state law, until a
notice of lien has been filed by the commissioner of revenue in
the office of the county recorder of the county in which real
property is situated, or in the case of personal property
belonging to an individual who is not a resident of this state
or to a corporation, partnership, or other organization, in the
office of the secretary of state, or in the case of personal
property belonging to a resident individual, in the office of
the county recorder of the county of residence of the individual.
Notwithstanding any other law to the contrary, the department of
revenue is exempt from the payment of fees at the time the lien
is offered for filing or recording. The fee for filing or
recording the lien must be paid at the time the release of lien
is offered for filing or recording. Notwithstanding any law to
the contrary, the fee for filing or recording the lien or the
release of lien is $15.
(b)(1) Notices of liens, and lien releases, transcriptions,
and renewals, in a form prescribed by the commissioner of
revenue, may be filed with the county recorder or the secretary
of state by mail, personal delivery, or by electronic
transmission by the commissioner or a delegate into the
computerized filing system of the secretary of state authorized
under section 336.9-411. The secretary of state shall transmit
the notice electronically to the office of the county recorder,
if that is the place of filing, in the county or counties shown
on the computer entry. The filing officer, whether the county
recorder or the secretary of state, shall endorse and index a
printout of the notice in the same manner as if the notice had
been mailed or delivered.
(2) County recorders and the secretary of state shall enter
information relative to lien notices, transcriptions, renewals,
and releases filed in their offices into the central data base
of the secretary of state. For notices filed electronically
with the county recorders, the date and time of receipt of the
notice and county recorder's file number, and for notices filed
electronically with the secretary of state, the secretary of
state's recording information, must be entered by the filing
officer into the central data base before the close of the
working day following the day of the original data entry by the
department of revenue.
The filing and indexing of all notices must be in
accordance with the filing and indexing of notices of federal
liens, certificates of release, and refiled notices under
section 272.483.
(c) Notwithstanding any other law to the contrary, the
department of revenue is exempt from payment of fees when a
lien, lien renewal, or lien transcription is offered for
recording. The recording fees must be paid along with the
release fee at the end of the month in which the release of lien
is recorded, after receipt of a monthly statement from a county
recorder or the secretary of state. The department of revenue
shall add the recording fees to the delinquent tax liability of
the taxpayer. Notwithstanding any other law to the contrary,
the fee for filing or recording a notice of lien, or lien
release, transcription, or renewal is $15.
(d) There is appropriated to the commissioner of revenue an
amount representing the cost of payment of recording fees to the
county recorders and the secretary of state. The commissioner
shall keep a separate accounting of the costs and of payments
for recording fees remitted by taxpayers, and make the records
available to the legislature upon request.
Sec. 3. Minnesota Statutes 1990, section 270.69,
subdivision 8, is amended to read:
Subd. 8. [FILING ENTITLEMENT.] Execution of notices of
liens or of other notices affecting state tax liens by the
original or facsimile signature of the commissioner of revenue
or a delegate entitles them to be filed, and no other
attestation, certification, or acknowledgment is necessary. For
purposes of this subdivision, transmission of notices under
subdivision 2, paragraph (b), clause (1), constitutes execution.
Sec. 4. Minnesota Statutes 1990, section 270.69,
subdivision 9, is amended to read:
Subd. 9. [LIEN SEARCH FEES.] Upon request of any person,
the filing officer shall issue a certificate showing whether
there is on file recorded in that filing office, on the date and
hour stated in the certificate, any notice of lien or
certificate or notice affecting any lien filed on or after June
30, 1979 ten years before the date of the search certificate,
naming a particular person, and giving the date and hour of
filing of each notice or certificate naming the person. The fee
for a certificate shall be as provided by section 336.9-407 or
357.18, subdivision 1, clause (3). Upon request, the filing
officer shall furnish a copy of any notice of state lien, or
notice or certificate affecting a state lien, for a fee of 50
cents per page.
Sec. 5. Minnesota Statutes 1990, section 272.479, is
amended to read:
272.479 [SCOPE.]
This section and sections 272.481 to 272.487 272.488 apply
only to federal tax liens and to other federal liens notices of
which under any act of Congress or any regulation adopted
pursuant thereto are required or permitted to be filed in the
same manner as notices of federal tax liens.
Sec. 6. Minnesota Statutes 1990, section 272.482, is
amended to read:
272.482 [EXECUTION OF NOTICES AND CERTIFICATES.]
Certification Execution of notices of liens, certificates,
or other notices affecting federal liens by the secretary of the
treasury of the United States or a delegate, or by any official
or entity of the United States responsible for filing or
certifying of notice of any other lien, entitles them to be
filed and no other attestation, certification, or acknowledgment
is necessary. For purposes of this section, transmission of
notices under section 272.488, subdivision 1, constitutes
execution.
Sec. 7. Minnesota Statutes 1990, section 272.483, is
amended to read:
272.483 [DUTIES OF FILING OFFICER.]
(a) If a notice of federal lien, a refiling of a notice of
federal lien, or a notice of revocation of any certificate
described in clause (b) is presented to a filing officer who is:
(1) the secretary of state, the secretary shall cause the
notice to be marked, held, and indexed in accordance with the
provisions of section 336.9-403, clause (4) of the uniform
commercial code as if the notice were a financing statement
within the meaning of that code alphabetically and numerically;
or
(2) any other officer described in section 272.481, the
officer shall endorse identification thereon and the date and
time of receipt and forthwith file it alphabetically or enter it
in an alphabetical index showing the name and address of the
person named in the notice, the date and time of receipt, the
file number of the lien, and the total amount appearing on the
notice of lien.
(b) If a certificate of release, nonattachment, discharge,
or subordination of any lien is presented to the secretary of
state for filing the secretary shall:
(1) cause a certificate of release or nonattachment to be
marked, held, and indexed as if the certificate were a
termination statement within the meaning of the uniform
commercial code, but the notice of lien to which the certificate
relates may not be removed from the files until ten years and 30
days after the filing date of the lien; and
(2) cause a certificate of discharge or subordination to be
marked, held, and indexed as if the certificate were a release
of collateral within the meaning of the uniform commercial code.
(c) If a refiled notice of federal lien referred to in
clause (a) or any of the certificates or notices referred to in
clause (b) is presented for filing to any other filing officer
specified in section 272.481, the officer shall permanently
attach the refiled notice or the certificate to the original
notice of lien and enter the refiled notice or the certificate
with the date of filing in any alphabetical lien index on the
line where the original notice of lien is entered.
(d) Upon request of any person, the filing officer shall
issue a certificate showing whether there is on file recorded in
that filing office, on the date and hour stated therein, any
notice of lien or certificate or notice affecting any lien filed
on or after July 1, 1971 ten years and 30 days before the date
of the search certificate, naming a particular person, and if a
notice or certificate is on file, giving the date and hour of
filing of each notice or certificate. The fee for a certificate
shall be that provided by section 336.9-407 or 357.18,
subdivision 1, clause (3). Upon request, the filing officer
shall furnish a copy of any notice of federal lien, or notice or
certificate affecting a federal lien, for a fee of 50 cents per
page.
Sec. 8. Minnesota Statutes 1990, section 272.485, is
amended to read:
272.485 [UNIFORMITY OF APPLICATION AND CONSTRUCTION.]
Sections 272.481 to 272.487 272.488 shall be so applied and
construed as to effectuate its general purpose to make uniform
the law with respect to the subject of sections 272.481 to
272.487 among those states which enact it.
Sec. 9. Minnesota Statutes 1990, section 272.486, is
amended to read:
272.486 [SHORT TITLE.]
Section 272.479 and sections 272.481 to 272.487 272.488 may
be cited as the Uniform Federal Lien Registration Act.
Sec. 10. [272.488] [COMPUTERIZED FILING OF TAX LIENS AND
NOTICES.]
Subdivision 1. [FILING OF NOTICES.] Notices of federal tax
liens, certificates, or revocations of certificates of release
of federal tax liens, and refiled notices of any of those items,
in a form prescribed by the Internal Revenue Service, may be
filed with the county recorder or the secretary of state by
mail, personal delivery, or by electronic transmission by the
Secretary of the Treasury of the United States or a delegate
into the computerized filing system of the secretary of state
authorized under section 336.9-411. The secretary of state
shall transmit the notice electronically to the office of the
county recorder, if that is the place of filing, in the county
or counties shown on the computer entry. The filing officer,
whether the county recorder or the secretary of state, shall
endorse and index a printout of the notice in the same manner as
if the notice had been mailed or delivered.
Subd. 2. [ENTRY OF INFORMATION.] County recorders and the
secretary of state shall enter information relative to lien
notices, releases, revocations of release, and refillings of any
of those items into the central data base of the secretary of
state. For notices filed electronically with the county
recorders, the date and time of receipt of the notice and county
recorder's file number, and for notices filed electronically
with the secretary of state, the secretary of state's recording
information, must be entered by the filing officer into the
central data base before the close of the working day following
the day of the original data entry by the Internal Revenue
Service.
Sec. 11. Minnesota Statutes 1990, section 336.9-411, is
amended to read:
336.9-411 [COMPUTERIZED FILING SYSTEM.]
(a) The secretary of state shall develop and implement a
statewide computerized filing system to accumulate and
disseminate information relative to lien statements, financing
statements, state and federal tax lien notices, and other
uniform commercial code documents. The computerized filing
system must allow information to be entered and retrieved from
the computerized filing system by county recorders, the
department of revenue, the department of jobs and training, and
the Internal Revenue Service.
(b) County recorders shall enter information relative to
lien statements, financing statements, state and federal tax
lien notices, and other uniform commercial code documents filed
in their offices into a central data base maintained by the
secretary of state. The information must be entered under the
rules of the secretary of state. This requirement does not
apply to tax lien notices filed under sections 268.161,
subdivision 1, paragraph (b), clause (2); 270.69, subdivision 2,
paragraph (b), clause (2); and 272.488, subdivision 1, but does
apply to entry of the date and time of receipt and county
recorder's file number of those notices.
(c) The secretary of state may allow private parties to
have electronic-view-only access to the computerized filing
system and to other computerized records maintained by the
secretary of state on a fee basis. If the computerized filing
system allows a form of electronic access to information
regarding the obligations of debtors, the access must be
available 24 hours a day, every day of the year.
(d) The secretary of state shall adopt rules to implement
the computerized filing system. The secretary of state may
adopt permanent and emergency rules. The rules must:
(1) allow filings to be made at the offices of all county
recorders and the secretary of state's office as required by
section 336.9-401;
(2) establish a central data base for all information
relating to liens and security interests that are filed at the
offices of county recorders and the secretary of state;
(3) provide procedures for entering data into a central
data base;
(4) allow the offices of all county recorders and the
secretary of state's office to add, modify, and delete
information in the central data base as required by the uniform
commercial code;
(5) allow the offices of all county recorders and the
secretary of state's office to have access to the central data
base for review and search capabilities;
(6) allow the offices of all county recorders to have
electronic-view-only access to the computerized business
information records on file with the secretary of state;
(7) require the secretary of state to maintain the central
data base;
(8) provide security and protection of all information in
the central data base and monitor the central data base to
ensure that unauthorized entry is not allowed;
(9) require standardized information for entry into the
central data base;
(10) prescribe an identification procedure for debtors and
secured parties that will enhance lien and financing statement
searches; and
(11) prescribe a procedure for phasing-in or converting
from the existing filing system to a computerized filing system.
(e) The secretary of state, county recorders, and their
employees and agents shall not be liable for any loss or damages
arising from errors in or omissions from information entered
into the computerized filing system as a result of the
electronic transmission of tax lien notices under sections
268.161, subdivision 1, paragraph (b), clause (2); 270.69,
subdivision 2, paragraph (b), clause (2); and 272.488,
subdivision 1.
Sec. 12. Minnesota Statutes 1990, section 357.18,
subdivision 2, is amended to read:
Subd. 2. Notwithstanding the provisions of any general or
special law to the contrary, the fees prescribed by this section
shall govern the filing or recording of all instruments in the
office of the county recorder other than uniform commercial code
documents, and documents filed or recorded pursuant to sections
270.69, subdivision 2, paragraph (c), 272.481 to 272.487
272.488, and 386.77.
Sec. 13. Minnesota Statutes 1990, section 386.46, is
amended to read:
386.46 [DISPOSAL OF OBSOLETE RECORDS.]
Documents, filed or recorded by the county recorder,
including sheriffs certificates, land title patents,
incorporations, official bonds, mechanics liens, affidavits,
probate court orders, district court orders, satisfactions,
warranty deeds, quitclaim deeds, lis pendens, assignments and
miscellaneous documents, but still in possession because
uncalled for by their owner for ten years after the filing or
recording, may be destroyed by the county recorder. State and
Federal liens, except federal estate and gift tax liens, may be
destroyed ten years and 30 days, and state liens may be
destroyed ten years after their filing or last extension and
stricken from the indexes.
Sec. 14. Minnesota Statutes 1990, section 508.25, is
amended to read:
508.25 [RIGHTS OF PERSON HOLDING CERTIFICATE OF TITLE.]
Every person receiving a certificate of title pursuant to a
decree of registration and every subsequent purchaser of
registered land who receives a certificate of title in good
faith and for a valuable consideration shall hold it free from
all encumbrances and adverse claims, excepting only the estates,
mortgages, liens, charges, and interests as may be noted in the
last certificate of title in the office of the registrar, and
also excepting any of the following rights or encumbrances
subsisting against it, if any:
(1) liens, claims, or rights arising or existing under the
laws or the constitution of the United States, which this state
cannot require to appear of record;
(2) the lien of any real property tax or special assessment
for which the land has not been sold at the date of the
certificate of title;
(3) any lease for a period not exceeding three years when
there is actual occupation of the premises thereunder;
(4) all rights in public highways upon the land;
(5) the right of appeal, or right to appear and contest the
application, as is allowed by this chapter;
(6) the rights of any person in possession under deed or
contract for deed from the owner of the certificate of title;
(7) any outstanding mechanics lien rights which may exist
under sections 514.01 to 514.17; and
(8) any lien for state taxes.
No existing or future liens or judgments arising under the
laws of this state for the nonpayment of any amounts due under
chapter 268 or any tax administered by the commissioner of
revenue may encumber title to lands registered under this
chapter unless filed under the terms of this chapter.
Sec. 15. Minnesota Statutes 1990, section 508A.25, is
amended to read:
508A.25 [RIGHTS OF PERSON HOLDING CPT.]
Every person holding a CPT issued pursuant to sections
508A.01 to 508A.85 who has acquired title in good faith and for
a valuable consideration shall hold the same free from all
encumbrances and adverse claims, excepting only estates,
mortgages, liens, charges, and interests as may be noted by
separate memorials in the latest CPT in the office of the
registrar, and also excepting the memorial provided in section
508A.351 and any of the following rights or encumbrances
subsisting against the same, if any:
(1) Liens, claims, or rights arising or existing under the
laws or the constitution of the United States, which this state
cannot require to appear of record;
(2) The lien of any real property tax or special assessment
for which the land has not been sold at the date of the CPT;
(3) Any lease for a period not exceeding three years when
there is actual occupation of the premises under it;
(4) All rights in public highways upon the land;
(5) The rights of any person in possession under deed or
contract for deed from the owner of the CPT;
(6) Any liens, encumbrances, and other interests that may
be contained in the examiner's supplemental directive issued
pursuant to section 508A.22, subdivision 2;
(7) Any claims that may be made pursuant to section 508A.17
within five years from the date the examiner's supplemental
directive is filed on the CPT; and
(8) Any outstanding mechanics lien rights which may exist
under sections 514.01 to 514.17; and
(9) any lien for state taxes.
Sec. 16. [REPEALER.]
Minnesota Statutes 1990, section 272.487, is repealed.
Sec. 17. [EFFECTIVE DATE.]
Sections 1 to 3, 6, 10, 11, 14, and 15 are effective for
liens and notices affecting liens filed on or after January 1,
1992. Sections 4, 5, 7 to 9, 12, 13, and 16 are effective the
day following final enactment.
ARTICLE 19
AMBULANCE AND EMERGENCY SERVICES PERSONNEL
Section 1. Minnesota Statutes 1990, section 171.06, is
amended by adding a subdivision to read:
Subd. 2b. [SURTAX IMPOSED.] A surtax of $2 is imposed on
classified drivers license and classified under 21 drivers
licenses in subdivision 2. This surtax does not apply to
duplicate drivers licenses. The surtax must be paid into the
state treasury and credited to the emergency medical services
personnel account established in section 2.
Sec. 2. Minnesota Statutes 1990, section 353D.01, is
amended to read:
353D.01 [PUBLIC EMPLOYEES DEFINED CONTRIBUTION PLAN.]
Subdivision 1. [ESTABLISHMENT.] The public employees
defined contribution plan is administered by the public
employees retirement association under supervision of the
association board of trustees. To assist it in governing the
operations of the plan, the board may appoint an advisory
committee of not more than nine members who are representative
of the employers and employees who participate in the plan.
Subd. 1a. [EMERGENCY MEDICAL SERVICES PERSONNEL
ACCOUNT.] A separate account is created in the general fund to
be known as the emergency medical services personnel account.
The account consists of all funds deposited in the general fund
from the drivers license surtax, and all funds forfeited under
sections 8 and 9. Investment earnings on money in the account
must be credited to the account.
Subd. 1b. [APPROPRIATION.] Money from the emergency
medical services account is appropriated on January 1 each year
to the public employees retirement association to fund the
ambulance service personnel incentive program as provided in
section 353D.031.
Subd. 2. [ELIGIBILITY.] (a) Except as provided in section
353D.11, eligibility to participate in the retirement plan is
open to:
(1) an elected local government official of a governmental
subdivision who elects to participate in the plan who is not a
member of the public employees retirement association within the
meaning of section 353.01, subdivision 7, and to;
(2) basic and advanced life support emergency medical
service personnel employed by or providing services for any
public ambulance service or privately operated ambulance service
that receives an operating subsidy from a governmental entity
that elects to participate; and
(3) a person who qualifies to have an ambulance service
personnel incentive payment made on the person's behalf under
section 353D.031.
(b) For purposes of this chapter, an elected local
government official includes a person appointed to fill a
vacancy in an elective office. Elected local government
official does not include an elected county sheriff. Except as
provided in section 353D.11, elected local government officials
and first response personnel and emergency medical service
personnel who are currently covered by a public or private
pension plan because of their employment or provision of
services are not eligible to participate in the plan.
Sec. 3. Minnesota Statutes 1990, section 353D.02, is
amended to read:
353D.02 [ELECTION OF COVERAGE.]
Eligible (a) Elected local government officials eligible
under section 353D.01, subdivision 2, paragraph (a), clause (1),
may elect to participate in the plan after being elected or
appointed to a public office by filing an application to
participate on a form prescribed by the executive director of
the association. Participation begins on the first day of the
month after the application is received in the association's
office or on the date when the term of office commences,
whichever date is later. An election to participate in the plan
is irrevocable during incumbency in office.
Each (b) For personnel eligible under section 353D.01,
subdivision 2, paragraph (a), clause (2), a public ambulance
service or privately operated ambulance service that receives an
operating subsidy from a governmental entity with eligible
personnel may elect to participate in the plan. If a service
elects to participate, its eligible personnel may elect to
participate or to decline to participate. An individual's
election must be made within 30 days of the service's election
to participate or 30 days of the date on which the individual
was employed by the service or began to provide service for it,
whichever date is later. An election by a service or an
individual is irrevocable.
(c) A person eligible under section 353D.01, subdivision 2,
paragraph (a), clause (3), may elect to participate in the
plan. The person must elect to participate or decline to
participate by June 30, 1994, or by June 30 of the fiscal year
after June 30, 1994, which the person first becomes qualified to
have an ambulance service personnel incentive payment made on
the person's behalf under section 353D.031.
Sec. 4. [353D.021] [PUBLIC EMPLOYEES RETIREMENT
ASSOCIATION TO PROVIDE PLAN INFORMATION TO CERTAIN AMBULANCE
ATTENDANTS.]
The public employees retirement association shall undertake
all practical efforts to inform ambulance attendants, ambulance
drivers, and ambulance service medical directors on an ongoing
basis about the ambulance service personnel incentive program
and their eligibility to elect to participate in this plan. The
commissioner of health and the executive director of the state
board of investment shall provide all reasonable assistance to
the public employees retirement association in preparing
relevant information on the incentive program and the plan.
Sec. 5. Minnesota Statutes 1990, section 353D.03, is
amended to read:
353D.03 [FUNDING OF PLAN.]
(a) An eligible elected local government official eligible
under section 353D.01, subdivision 2, paragraph (a), clause (1),
who elects to participate in the public employees defined
contribution plan shall contribute an amount equal to five
percent of salary as defined in section 353.01, subdivision 10.
A participating elected local government official's governmental
subdivision shall contribute a matching amount.
(b) A public ambulance service or privately operated
ambulance service that receives an operating subsidy from a
governmental entity that elects to participate in the plan shall
fund benefits for its qualified personnel eligible under section
353D.01, subdivision 2, paragraph (a), clause (2), who
individually elect to participate, except that personnel who are
paid for their services may elect to make member contributions
in an amount not to exceed the service's contribution on their
behalf. Ambulance service contributions on behalf of salaried
employees must be a fixed percentage of salary. An ambulance
service making contributions for volunteer or largely
uncompensated personnel may assign a unit value for each call or
each period of alert duty for the purpose of calculating
ambulance service contributions. ambulance service
contributions. An ambulance service with personnel for whom
funding is provided under the paragraph that has ambulance
attendants, ambulance drivers, and ambulance service medical
directors qualified to have an ambulance service personnel
incentive payment made on the person's behalf under section
353D.031 may discontinue that funding if the ambulance service
has given its participating personnel at least 18 months notice
of its intent to discontinue its funding of the plan.
Sec. 6. [353D.031] [AMBULANCE SERVICE PERSONNEL INCENTIVE
PROGRAM.]
Subdivision 1. [ADMINISTRATION.] The money credited in the
emergency medical services personnel account must be allocated
annually by the executive director of the public employees
retirement association.
Subd. 2. [ELIGIBILITY FOR ALLOCATION.] (a) The money
credited in the emergency medical services personnel account
must be annually allocated on the basis of the number of
qualified personnel and their credited service during the
previous year ending June 30.
(b) The amount of revenue paid to the emergency medical
services account since the effective date of this section or the
date of the last allocation, whichever applies, plus any net
investment income credited to the account, must be determined.
(c) The number of qualified personnel must be determined.
Qualified personnel are ambulance attendants, ambulance drivers,
and ambulance service medical directors who:
(1) are employed by or serving an ambulance service that is
licensed as such by the state of Minnesota;
(2) perform all or a predominant portion of services in
Minnesota or on behalf of Minnesota residents, as certified by
the chief administrative officer of the ambulance service;
(3) are currently certified by the department of health as
an ambulance attendant, ambulance driver, or ambulance service
medical director and are certified as active by the chief
administrative officer of the ambulance service;
(4) for the year in question, would be considered a
volunteer attendant under section 144.8091, subdivision 2,
except that the salary limit is $3,000 for calendar year 1992,
and is $3,000 multiplied by the cumulative percentage increase
in the national consumer price index for all urban wage earners
published by the federal Department of Labor since December 31,
1992;
(5) for an ambulance service medical director, meets the
salary limit set forth in clause (4) based only on the person's
hourly stipends or salary for service as a medical director; and
(6) has credit for no more than 20 years of service.
(d) The amount of credited service by qualified personnel
in the form of units must be determined. A year of service by a
qualified person after the person elects to participate in the
plan, or after January 1, 1992, whichever is later, is equal to
two units. If a qualified person has service that would have
qualified before the date of election of participation or
January 1, 1992, whichever is later, the person must receive an
additional one-fifth of a unit per year of that service for a
maximum of five years, except that the person cannot receive
credit for any year in which contributions were made by an
ambulance service on the person's behalf under sections 353D.03
and 353D.04.
Subd. 3. [ALLOCATION.] The money available for allocation
must be divided by the greater of 2,000 units or the total
number of units associated with qualified personnel to determine
the dollar value of a unit. A qualified person is entitled to
have deposited on the person's behalf in the person's individual
account an amount equal to the dollar value of a unit multiplied
by the person's number of units credited for that year under
subdivision 2, paragraph (d).
Sec. 7. Minnesota Statutes 1990, section 353D.05, is
amended to read:
353D.05 [INVESTMENT OF FUNDS.]
Subdivision 1. [INVESTMENT.] Employing unit
contributions under section 353D.03 and ambulance service
personnel incentive allocation under section 353D.031, after the
deduction of an amount for administrative expenses, and
individual participant contributions must be remitted to the
state board of investment for investment in the Minnesota
supplemental investment fund established by section 11A.17.
Subd. 2. [INVESTMENT OPTIONS.] (a) An individual
participant may elect to purchase shares in the income share
account, the growth share account, the money market account, the
bond market account, the guaranteed return account, or the
common stock index account established by section 11A.17, or a
combination of those accounts. The participant may elect to
purchase shares in a combination of those accounts by specifying
the percentage of the total contributions and ambulance service
personnel incentive allocation to be used to purchase shares in
each of the accounts.
(b) Twice in a calendar year, a participant may indicate in
writing a choice of options for subsequent purchases of shares.
After a choice is made, until the participant makes a different
written indication, the executive director of the association
shall purchase shares in the supplemental investment fund or
funds specified by the participant. If no initial option is
indicated by a participant, the executive director shall invest
all contributions made by or on behalf of a participant in the
income share account. A choice of investment options is
effective no later than the first pay date occurring more than
30 days after receipt of the written choice of options.
(c) One month before the start of a new guaranteed
investment contract, a participant may elect to transfer all or
a portion of the participant's shares previously purchased in
the income share, growth share, common stock index, bond market,
or money market accounts to the new guaranteed investment
contract in the guaranteed return account. If a partial
transfer is made, a minimum of $200 must be transferred and a
minimum balance of $200 must remain in the previously selected
investment options. Upon expiration of a guaranteed investment
contract, the participant's shares attributable to that contract
must be transferred to a new guaranteed investment contract
unless the executive director is otherwise directed by the
participant. Shares in the guaranteed return account may not be
withdrawn from the fund or transferred to another account until
the guaranteed investment contract has expired, unless the
participant qualifies for a benefit payment under section
353D.07.
(d) Twice in a calendar year, a participant or former
participant may also change the investment options selected for
all or a portion of the individual's previously purchased shares
in accounts other than the guaranteed return account. If a
partial transfer of previously purchased shares is selected, a
minimum of $200 must be transferred and a minimum balance of
$200 must remain in the previously selected investment option.
A change under this paragraph is effective as soon as cash flow
to an account permits, but not later than six months from the
requested change.
Subd. 3. [ADMINISTRATIVE EXPENSES.] The public employees
retirement association may deduct an amount, set annually by the
executive director of the association, but not to exceed two
percent of the employing unit contributions to the plan, to
defray the expenses of the association in administering the
plan. The amount must be set annually by the executive director
of the association, but not to exceed two percent of the total
amount of the employing unit contributions to the plan and the
ambulance service personnel incentive allocation received by the
plan.
Sec. 8. [353D.051] [VESTING FOR INCENTIVE ALLOCATION.]
(a) Sixty months of service credit, accumulated after the
date on which the person elects to participate in the plan, are
required for vesting of retirement benefits under section
353D.07, other than on account of death, that are derived from
ambulance service personnel incentive allocations under section
353D.031. These 60 months must be accumulated within 120 months
of the first month of service credit earned after the date on
which the person elects to participate in the plan. No minimum
period of service is required for vesting of benefits under
section 353D.07, on account of death, that are derived from
ambulance service personnel incentive allocations under section
353D.031, once the person has elected to participate in the
plan. Upon completion of 60 months of service under the plan
with one or more participating ambulance services, a participant
terminating active service is entitled to receive the value of
the participant's individual account as provided in section
353D.07.
(b) Amounts derived from ambulance service personnel
incentive allocations under section 353D.031 that are credited
to a person's account are forfeited at the end of the 120th
month after the first month of service credit earned after the
date on which the person elects to participate in the plan, if
the person does not have 60 months of service credit at that
time. Funds forfeited must be added to the emergency medical
services personnel account for the subsequent January 1
allocation under section 353D.031.
Sec. 9. Minnesota Statutes 1990, section 353D.06, is
amended to read:
353D.06 [REPORTING.]
The executive director of the public employees retirement
association shall prescribe the reporting forms required from
employing units and the election forms required from
participants. Reporting forms must contain names,
identification numbers, amount of contribution by and on behalf
of each participant, and such other data as is required to keep
an accurate record of the account value of each participant and
to determine eligibility for aid allocations of ambulance
service personnel incentive amounts under section 353D.031.
In the event an ambulance service fails to provide required
information within 60 days after the public employees retirement
association sends the service a notice that the information is
overdue, its members forfeit the service units credited and its
members are not entitled to the ambulance service personnel
incentive amount allocated for that year. Ambulance services
that provide fraudulent information are subject to criminal
prosecution.
Sec. 10. [353D.091] [FEDERAL REQUIREMENTS.]
Subdivision 1. [PLAN TAX QUALIFICATION AND STATUS.] The
public employees retirement association shall seek a
determination from the Internal Revenue Service regarding the
tax qualification status of the incentive program and from the
United States Department of Labor regarding whether the
incentive program must comply with federal Employee Retirement
Income Security Act (ERISA) requirements.
Subd. 2. [REPORT TO LEGISLATURE.] The executive director
shall immediately report the results of each determination to
the chairs of the senate governmental operations committee,
house governmental operations committee, and legislative
commission on pensions and retirement.
Subd. 3. [IMPLEMENTATION DELAY.] The association shall not
credit participants with service units nor transfer money from
the emergency medical services personnel account under section
353D.031, subdivision 1, into individual accounts unless written
notification is received from (1) the Internal Revenue Service
that implementation of the incentive program does not jeopardize
the tax-exempt status of the defined contribution plan or a
public pension plan under section 356.30, subdivision 3, and (2)
the United States Department of Labor that the incentive program
need not comply with federal ERISA requirements, including any
requirements for tax-deferred treatment of contributions and
interest earned on contributions.
Subd. 4. [RULES AND POLICIES.] If the incentive program
receives favorable determinations from both the Internal Revenue
Service and the United States Department of Labor, the
association shall formulate and adopt rules or policies in
accordance with the restrictions and standards of the Internal
Revenue Code and rules and regulations of the Internal Revenue
Service.
Sec. 11. [EFFECTIVE DATE.]
If the requirements under section 10 are met by June, 1992,
sections 1 to 5 and 9 are effective July 1, 1992, and section 6
is effective January 1, 1993. If not, sections 1 to 10 are
inoperative.
ARTICLE 20
REVERSE MORTGAGES
Section 1. Minnesota Statutes 1990, section 47.58,
subdivision 6, is amended to read:
Subd. 6. [TAXES; INSURANCE.] The borrower shall pay real
estate taxes, assessments and insurance premiums on the property
securing the loan, and the lender may require the borrower to
provide evidence of payment. Mortgage registry tax required
under sections 287.01 to 287.12 must be paid at the time of the
recording or registering of the original reverse mortgage. If
the borrower does not make timely payment the lender may pay
taxes, assessments, insurance premiums and other similar charges
for the protection of the property securing its loan and may add
these payments to the outstanding loan balance if not repaid by
the borrower within 60 days after the borrower receives notice
that the lender has made the payment.
Sec. 2. Minnesota Statutes 1990, section 287.05, is
amended to read:
287.05 [TAX ON RECORDATION OR REGISTRATION; SUPPLEMENTAL
MORTGAGES.]
Subdivision 1. [TAX IMPOSED.] A tax of 23 cents is imposed
upon each $100, or fraction thereof, of the principal debt or
obligation which is or may be secured by any mortgage of real
property situated within the state executed, delivered, and
recorded or registered; provided, however, that the tax shall be
imposed but once upon any mortgage and extension thereof. If
the mortgage describes real estate situated outside of this
state, the tax shall be imposed upon that proportion of the
whole debt secured thereby as the value of the real estate
therein described situated in this state bears to the value of
the whole of the real estate described therein. The tax imposed
by this section shall not apply to a contract for the conveyance
of any interest in real estate.
Subd. 2. [SUPPLEMENTAL MORTGAGES.] Any supplemental
mortgage, not including revisions to a reverse mortgage as
described under subdivision 6, securing a portion or all of the
same indebtedness, whether or not additional security is
included, shall be taxed in the following manner:
(a) Any additional indebtedness shall be taxed on the ratio
that the value of the real estate therein described in this
state bears to the value of the whole of the real estate
described therein.
(b) If there is no additional indebtedness but the
percentage of the Minnesota real estate as compared to the total
real estate secured by the previous mortgage is increased, the
tax shall be recomputed and paid on the remaining indebtedness
multiplied by the difference between that percentage of
Minnesota real estate included in the supplemental mortgage and
that percentage included in any previous mortgage.
(c) In the event of both an increase in the indebtedness
and a change in the Minnesota percentage of real estate given as
security, the tax shall be recomputed on the portion
representing new indebtedness in the manner provided in (a) and
in the event of an increase in the percentage of Minnesota
property included as security, the tax shall be computed on the
remaining portion of the indebtedness as provided in (b).
Subd. 3. [REVOLVING LINES OF CREDIT.] When a mortgage,
including a reverse mortgage, secures a revolving line of credit
under which advances, payments, and readvances may be made from
time to time, the tax imposed under subdivision 1 shall be paid
on the maximum amount of the line of credit which may be secured
at any one time, as expressed in the mortgage, regardless of the
time or amount of advances, payments, or readvances.
Subd. 4. [ADVANCES BY MORTGAGEE.] No tax under subdivision
1 shall be paid on the indeterminate amount which may be
advanced by the mortgagee in protection of the mortgaged
premises or the mortgage, including taxes, assessments, charges,
claims, fines, impositions, insurance premiums, amounts due upon
prior or superior mortgages and other prior or superior liens,
encumbrances and interests, and legal expenses and attorneys'
fees.
Subd. 5. [INDETERMINATE AMOUNTS.] When a mortgage secures
an indeterminate amount other than those described in
subdivision 3 or, 4, or 6, no tax shall be paid at the time the
mortgage is recorded or registered, but the tax must be paid at
the time of recording or filing an affidavit stating the amount
and time of the actual advance.
Subd. 6. [REVERSE MORTGAGES.] If real property secures a
reverse mortgage, the principal debt or obligation to which
mortgage registry tax applies is the expected total
disbursements or cash equivalent to be made under the terms of
the loan. Interest accruing on the disbursements made is not
subject to mortgage registry tax. In the case of periodic
payments made for an indefinite length of time, the expected
total disbursements must equal the product of the periodic
payment amounts and the number of payments and, if applicable,
the amount of cash distribution or its equivalent. The number
of payments must be based upon the life expectancy assumption
used in determining the payment amount. In the case of reverse
mortgages made as part of the Housing and Community Development
Act of 1987, section 255 of the National Housing Act, and
administered by the Department of Housing and Urban Development
(HUD), mortgage registry tax must not be assessed on Federal
Housing Administration mortgage insurance premiums, monthly
lender service fees, or payments to be distributed to the
borrower by HUD.
Sec. 3. [EFFECTIVE DATE.]
Sections 1 and 2 are effective the day following final
enactment.
ARTICLE 21
MISCELLANEOUS
Section 1. Minnesota Statutes 1990, section 14.03,
subdivision 3, is amended to read:
Subd. 3. [RULEMAKING PROCEDURES.] The definition of a rule
in section 14.02, subdivision 4, does not include:
(1) rules concerning only the internal management of the
agency or other agencies that do not directly affect the rights
of or procedures available to the public;
(2) rules of the commissioner of corrections relating to
the placement and supervision of inmates serving a supervised
release term, the internal management of institutions under the
commissioner's control, and rules adopted under section 609.105
governing the inmates of those institutions;
(3) rules of the division of game and fish published in
accordance with section 97A.051;
(4) rules relating to weight limitations on the use of
highways when the substance of the rules is indicated to the
public by means of signs;
(5) opinions of the attorney general;
(6) the systems architecture plan and long-range plan of
the state education management information system provided by
section 121.931;
(7) the data element dictionary and the annual data
acquisition calendar of the department of education to the
extent provided by section 121.932; or
(8) the occupational safety and health standards provided
in section 182.655; or
(9) revenue notices and tax information bulletins of the
commissioner of revenue.
Sec. 2. Minnesota Statutes 1990, section 16A.15,
subdivision 6, is amended to read:
Subd. 6. [BUDGET AND CASH FLOW RESERVE ACCOUNT.] A budget
and cash flow reserve account is created in the general fund in
the state treasury. The commissioner of finance shall, as
authorized from time to time by law, restrict part or all of the
budgetary balance in the general fund for use as the budget and
cash flow reserve account. The commissioner of finance shall
transfer to from the budget and cash flow reserve account such
amounts as are available the amount necessary to bring the total
amount, including any existing balance in the account on June
30, 1989 1991, to $550,000,000 $400,000,000. The amounts
restricted shall remain in the account until drawn down under
subdivision 1 or increased under section 16A.1541.
Sec. 3. Minnesota Statutes 1990, section 116.07,
subdivision 4h, is amended to read:
Subd. 4h. [FINANCIAL RESPONSIBILITY RULES.] (a) The agency
shall adopt rules requiring the operator or owner of a solid
waste disposal facility to submit to the agency proof of the
operator's or owner's financial capability to provide reasonable
and necessary response during the operating life of the facility
and for 20 years after closure, and to provide for the closure
of the facility and postclosure care required under agency
rules. Proof of financial responsibility is required of the
operator or owner of a facility receiving an original permit or
a permit for expansion after adoption of the rules. Within 180
days of the effective date of the rules or by July 1, 1987,
whichever is later, proof of financial responsibility is
required of an operator or owner of a facility with a remaining
capacity of more than five years or 500,000 cubic yards that is
in operation at the time the rules are adopted. Compliance with
the rules is a condition of obtaining or retaining a permit to
operate the facility.
(b) The agency shall amend the rules adopted under
paragraph (a) to allow a municipality, as defined in section
475.51, subdivision 2, including a sanitary district, that owns
or operates a solid waste disposal facility that was in
operation on May 15, 1989, to meet its financial responsibility
for all or a portion of the contingency action portion of the
reasonable and necessary response costs at the facility through
its authority to issue bonds, provided that the method developed
in the rules will ensure that when funds are needed for a
contingency action, sufficient bonds can and will be issued by
the municipality to meet its responsibility. The rules must
include at least:
(1) a requirement that the governing body of the
municipality enact an ordinance that clearly accepts
responsibility for the costs of contingency action at the
facility and that reserves, during the operating life of the
facility and for 20 years after closure, a portion of the debt
limit of the municipality, as established under section 475.53
or other law, that is equal to the total contingency action
costs calculated under the rules;
(2) a requirement that the municipality assure that all
collectors that haul to the facility implement a plan for
reducing solid waste by using volume-based pricing, recycling
incentives, or other means;
(3) a requirement that when a municipality opts under the
rules to meet a portion of its financial responsibility by
relying on its authority to issue bonds, it shall also begin
setting aside funds that will cover a portion of the potential
contingency action costs at the facility, the amount to be
determined by the agency for each facility based on at least the
amount of waste deposited in the disposal facility each year,
and the likelihood and potential timing of conditions arising at
the facility that will necessitate response action; and
(4) a requirement that a municipality have and consistently
maintain an investment grade bond rating as a condition of using
bonding authority to meet financial responsibility under this
section.
(c) Counties shall comply with existing financial
responsibility rules until those rules are amended under
paragraph (b), and, after that time, counties shall comply with
the amended rules. The method for proving financial
responsibility developed under paragraph (b) may not be applied
to a new solid waste disposal facility or to expansion of an
existing facility, unless the expansion is a vertical expansion.
Vertical expansions of qualifying existing facilities cannot be
permitted for a duration of longer than three years.
Sec. 4. Minnesota Statutes 1990, section 138.17,
subdivision 1a, is amended to read:
Subd. 1a. [RECORDS INSPECTION.] Government records which a
state agency, political subdivision, or statewide system lists
on a records disposition application or records schedule, or on
which archival assistance or advice is requested, may be
inspected by state archives' employees if state archives gives
prior notice. Employees of the archives shall have access to
the records for the purpose of determining the historical or
other continuing value of the records, regardless of the
records' classification pursuant to chapter 13 or 270B.
Employees of the archives shall be liable to the penalties set
forth for improper disclosure by them of private, confidential,
nonpublic, or protected nonpublic data inspected for this
purpose.
Sec. 5. [268.55] [FOOD BANK PROGRAM.]
Subdivision 1. [DISTRIBUTION OF APPROPRIATION.] The
economic opportunity office of the department of jobs and
training shall distribute funds appropriated to it by law for
that purpose to food banks, as defined in section 31.50,
subdivision 1, paragraph (b). A food bank qualifies under this
section if it is a nonprofit corporation, or is affiliated with
a nonprofit corporation, as defined under section 501(c)(3) of
the Internal Revenue Code of 1986, and distributes food to
qualifying foodshelves. A foodshelf qualifies under this
section if:
(1) it is a nonprofit corporation, or is affiliated with a
nonprofit corporation, as defined in section 501(c)(3) of the
Internal Revenue Code of 1986;
(2) it distributes standard food orders without charge to
needy individuals. The standard food order must consist of at
least a two-day supply or six pounds per person of nutritionally
balanced food items;
(3) it does not limit food distributions to individuals of
a particular religious affiliation, race, or other criteria
unrelated to need or to requirements necessary to administration
of a fair and orderly distribution system;
(4) it does not use the money received or the food
distribution program to foster or advance religious or political
views; and
(5) it has a stable address and directly serves individuals.
Subd. 2. [APPLICATION.] In order to receive money
appropriated for food banks under this section, a food bank must
apply to the economic opportunity office. The application must
be in a form prescribed by the economic opportunity office and
must contain information required by the economic opportunity
office to verify that the applicant is a qualifying food bank,
and the amount the applicant is entitled to receive under
subdivision 3. Applications must be filed at the times and for
the periods determined by the economic opportunity office.
Subd. 3. [DISTRIBUTION FORMULA.] The economic opportunity
office shall distribute money appropriated to it for foodshelf
programs to qualifying food banks in proportion to the number of
individuals served by the foodshelf programs supplied by the
food bank. The economic opportunity office shall gather data
from applications or other appropriate sources to determine the
proportionate amount each qualifying program is entitled to
receive. The economic opportunity office may increase or
decrease the qualifying food bank's proportionate amount if it
determines the increase or decrease is necessary or appropriate
to meet changing needs or demands.
Subd. 4. [USE OF MONEY.] At least 95 percent of the money
distributed to food banks under this section must be used to
purchase nutritious food for distribution without charge to
qualifying foodshelves serving needy individuals and families.
No more than five percent of the money may be expended for other
expenses, such as rent, salaries, and other administrative
expenses of the food banks.
Subd. 5. [ENFORCEMENT.] Recipient food banks must retain
records documenting expenditure of the money and comply with any
additional requirements imposed by the economic opportunity
office. The economic opportunity office may require a food bank
receiving funds under this section to report on its use of the
funds. The economic opportunity office may require that the
report contain an independent audit. If ineligible expenditures
are made by a food bank, the ineligible amount must be repaid to
the economic opportunity office and deposited in the general
fund.
Sec. 6. [270.0604] [REVENUE NOTICES.]
Subdivision 1. [AUTHORITY.] The commissioner of revenue
may make, adopt, and publish interpretive revenue notices. A
"revenue notice" is a policy statement that has been published
pursuant to subdivision 5 and that provides interpretation,
details, or supplementary information concerning the application
of law or rules. Revenue notices are published for the
information and guidance of taxpayers, the department of
revenue, and others concerned.
Subd. 2. [EFFECT.] Revenue notices do not have the force
and effect of law and have no precedential effect, but may be
relied on by taxpayers until revoked or modified. A notice may
be expressly revoked or modified by the department, by the
issuance of a revenue notice, but may not be revoked or modified
retroactively to the detriment of the taxpayers. A change in
the law or an interpretation of the law occurring after the
revenue notice is issued, whether in the form of a statute,
court decision, administrative rule, or revenue notice, results
in revocation or modification of the notice to the extent that
the change affects the notice.
Subd. 3. [RETROACTIVITY.] Revenue notices are generally
interpretive of existing law and therefore are retroactive to
the effective date of the applicable law provision unless
otherwise stated in the notice.
Subd. 4. [ISSUANCE.] The issuance of revenue notices is at
the discretion of the commissioner of revenue. The commissioner
shall establish procedures governing the issuance of revenue
notices and tax information bulletins.
Subd. 5. [PUBLICATION.] The commissioner shall publish the
revenue notices in the State Register and in any other manner
that makes them accessible to the general public. The
commissioner may charge a reasonable fee for publications.
Subd. 6. [APPLICABILITY.] This section does not apply to
property tax law.
Sec. 7. [270.0605] [TAX INFORMATION BULLETINS.]
The commissioner of revenue may issue tax information
bulletins. "Tax information bulletins" are informational guides
to enable taxpayers to become more familiar with Minnesota tax
laws and their rights and responsibilities under the tax laws.
Nothing contained in the tax information bulletins supersedes,
alters, or otherwise changes any provisions of the Minnesota tax
law, administrative rules, court decisions, or revenue notices.
Sec. 8. Minnesota Statutes 1990, section 270.067,
subdivision 1, is amended to read:
Subdivision 1. [STATEMENT OF PURPOSE.] State governmental
policy objectives are sought to be achieved both by direct
expenditure of governmental funds and by the granting of special
and selective tax relief or tax expenditures. Both direct
expenditures of governmental funds and tax expenditures have an
effect on the ability of the state and local governments to
lower tax rates or to increase expenditures. As a result, tax
expenditures should receive a regular and comprehensive review
by the legislature as to (a) their total cost, (b) their
effectiveness in achieving their objectives, (c) their effect on
the fairness and equity of the distribution of the tax burden,
and (d) the public and private cost of administering tax
expenditure financed programs. This section is intended to
facilitate a regular review of the state and local tax
expenditure budget by the legislature by providing for the
preparation of a regular biennial tax expenditure budget.
Sec. 9. Minnesota Statutes 1990, section 270.067,
subdivision 2, is amended to read:
Subd. 2. [PREPARATION; SUBMISSION.] The commissioner of
revenue shall prepare a tax expenditure budget for the state
every four years. The tax expenditure budget report shall be
submitted to the legislature as a supplement to the governor's
budget and at the same time as provided for submission of the
budget pursuant to section 16A.11, subdivision 1, except that
the next such report shall be submitted in 1993, and every four
years thereafter.
Sec. 10. Minnesota Statutes 1990, section 270B.09, is
amended to read:
270B.09 [CONTRACTS WITH THE STATE; SETOFF.]
The commissioner may disclose to the department of finance
or any state agency making payment to a vendor as described in
section 270.66 or 290.97 whether the vendor has an uncontested
delinquent tax liability owed to the commissioner and the amount
of any liability. The commissioner may also disclose taxpayer
identity information to the department of finance and to the
University of Minnesota, solely for vendor setoff purposes.
Sec. 11. Minnesota Statutes 1990, section 287.22, is
amended to read:
287.22 [EXCEPTIONS.]
The tax imposed by section 287.21 shall not apply to:
A. Any executory contract for the sale of land under which
the vendee is entitled to or does take possession thereof, or
any assignment or cancellation thereof.
B. Any mortgage or any assignment, extension, partial
release, or satisfaction thereof.
C. Any will.
D. Any plat.
E. Any lease.
F. Any deed, instrument, or writing in which the United
States or any agency or instrumentality thereof is the grantor,
assignor, transferor, conveyor, grantee or assignee.
G. Deeds for cemetery lots.
H. Deeds of distribution by personal representatives.
I. Deeds to or from coowners partitioning undivided
interests in the same piece of property.
J. Any deed or other instrument of conveyance issued
pursuant to a land exchange under section 92.121 and related
laws.
Sec. 12. Minnesota Statutes 1990, section 289A.39,
subdivision 1, as amended by Laws 1991, chapter 18, section 2,
is amended to read:
Subdivision 1. [EXTENSIONS FOR SERVICE MEMBERS.] (a) The
limitations of time provided by this chapter and, chapter 290
relating to income taxes and, chapter 271 relating to the tax
court for filing returns, paying taxes, claiming refunds,
commencing action thereon, appealing to the tax court from
orders relating to income taxes, and the filing of petitions
under chapter 278 that would otherwise be due May 15, 1991, and
appealing to the Supreme Court from decisions of the tax court
relating to income taxes are extended, as provided in section
7508 of the Internal Revenue Code of 1986, as amended through
January 30, 1991.
(b) If a member of the national guard or reserves is called
to active duty in the armed forces, the limitations of time
provided by this chapter and chapters 290 and 290A relating to
income taxes and claims for property tax refunds are extended by
the following period of time:
(1) in the case of an individual whose active service is in
the United States, six months; or
(2) in the case of an individual whose active service
includes service abroad, the period of initial service plus six
months.
Nothing in this paragraph reduces the time within which an
act is required or permitted under paragraph (a).
(c) If an individual entitled to the benefit of paragraph
(a) files a return during the period disregarded under paragraph
(a), interest must be paid on an overpayment or refundable
credit from the due date of the return, notwithstanding section
289A.56, subdivision 2.
(d) The provisions of this subdivision apply to the spouse
of an individual entitled to the benefits of this subdivision
with respect to a joint return filed by the spouses.
Sec. 13. Minnesota Statutes 1990, section 290.611,
subdivision 1, is amended to read:
Subdivision 1. No person who prepares, aids in the
preparation, processes, transmits, consults with respect to or
reviews a state or federal tax return for another person,
corporation, partnership, association or other taxpayer shall
divulge any particulars of such return, except to authorized
employees of the department of revenue or of the Internal
Revenue Service in the course of an examination, without the
written permission of such person, corporation, partnership,
association or other taxpayer or the legally appointed
representative of such taxpayer if such taxpayer is deceased,
incompetent or otherwise unable to give such consent. The
provisions of this subdivision shall not apply to disclosure by
an employee of the department of revenue or of the Internal
Revenue Service to other employees of such department or service
where such disclosure is necessary for the effective
administration of the tax laws of the state or the federal
government.
Sec. 14. Minnesota Statutes 1990, section 469.167,
subdivision 2, is amended to read:
Subd. 2. [DURATION.] The designation of an area as an
enterprise zone shall be effective for seven years after the
date of designation, except that enterprise zones in border
cities eligible to receive allocations for tax reductions under
section 469.169, subdivisions 7 and 8, and under section
469.171, subdivision 6a or 6b, shall be effective until these
allocations have been expended.
Sec. 15. Minnesota Statutes 1990, section 469.171, is
amended by adding a subdivision to read:
Subd. 6b. [ADDITIONAL BORDER CITY ALLOCATIONS.] In
addition to tax reduction authorized under section 469.169,
subdivisions 7 and 8, and under subdivision 6a, the commissioner
may allocate $1,000,000 for tax reductions as provided in this
section to enterprise zones designated under section 469.168,
subdivision 4, paragraph (c), except for zones located in cities
of the first class. The money shall be allocated among the
zones on a per capita basis. Limits on the maximum allocation
to a zone imposed by section 469.169, subdivision 7, do not
apply to allocations made under this subdivision.
Sec. 16. Minnesota Statutes 1990, section 462C.03,
subdivision 10, is amended to read:
Subd. 10. Notwithstanding any provision of this chapter,
not more than 20 percent of the aggregate dollar amount
of tax-exempt bond proceeds and any other funds appropriated by
any city within any calendar year to make or purchase loans
providing single family housing or dwelling units for sale
within multifamily housing developments described in section
462C.05, subdivision 3, shall be appropriated to provide single
family housing for persons or families, including renters of the
single family housing, whose gross income exceeds the limit in
section 462C.03, subdivision 2. If 20 percent of the total
amount of tax-exempt bond funds so appropriated by the city in
any calendar year is expended for housing not within the limit,
no additional funds may be expended pursuant to any other
similar appropriation until the remaining 80 percent is expended
for housing within the limit. Notwithstanding subdivision 2,
the city may use taxable bond proceeds for single family housing
for persons and families with adjusted gross incomes of up to
175 percent of the median family income as estimated by the
United States Department of Housing and Urban Development for
the nonmetropolitan county or standard metropolitan statistical
area, whichever is appropriate.
Sec. 17. [469.0813] [ROSEMOUNT; PORT AUTHORITY.]
Subdivision 1. [ESTABLISHMENT; POWERS.] The city of
Rosemount may, by adoption of an enabling resolution in
compliance with the procedural requirements of subdivision 3,
establish a port authority commission that, subject to the
provisions of subdivision 2, has the same powers as a port
authority established under section 469.049 or other law, and a
housing and redevelopment authority established under sections
469.001 to 469.047 or other law, and shall constitute an
"agency" that may administer one or more municipal development
districts under section 469.110. If the city establishes a port
authority commission under this section, the city shall exercise
all the powers relating to a port authority granted to any city
by sections 469.048 to 469.068 or other law, and all powers
relating to a housing and redevelopment authority granted to any
city by sections 469.001 to 469.047 or other law.
Subd. 2. [LIMITATION OF POWERS.] (a) The enabling
resolution may impose the following limitations upon the actions
of the port authority:
(1) that the port authority shall not exercise any
specified powers contained in sections 469.001 to 469.047 and
469.048 to 469.068 or that the port authority shall not exercise
any powers without the prior approval of the city council;
(2) that, except when previously pledged by the port
authority, the city council may, by resolution, require the port
authority to transfer any portion of the reserves generated by
activities of the port authority which the city council
determines is not necessary for the successful operation of the
port authority, to the city general fund, to be used for any
general purpose of the city;
(3) that the sale of all bonds or obligations issued by the
port authority be approved by the city council before issuance;
(4) that the port authority follow the budget process for
city departments as provided by the city and as implemented by
the city council and mayor;
(5) that all official actions of the port authority must be
consistent with the adopted comprehensive plan of the city, and
any official controls implementing the comprehensive plan;
(6) that the port authority submit to the city council for
approval by resolution any proposed project as defined in
section 469.174, subdivision 8;
(7) that the port authority submit all planned activities
for influencing the action of any other governmental agency,
subdivision, or body to the city council for approval;
(8) that the port authority submit its administrative
structure and management practices to the city council for
approval; and
(9) any other limitation or control established by the city
council by the enabling resolution.
(b) The enabling resolution may be modified at any time,
subject to clause (e), and provided that any modification is
made in accordance with the procedural requirements of
subdivision 3.
(c) Without limiting the right of the port authority to
petition the city council at any time, each year, within 60 days
of the anniversary date of the initial adoption of the enabling
resolution, the port authority shall submit to the city council
a report stating whether and how the enabling resolution should
be modified. Within 30 days of receipt of the recommendation,
the city council shall review the enabling resolution, consider
the recommendations of the port authority, and make any
modifications it considers appropriate; provided that any
modification shall be made in accordance with the procedural
requirements of subdivision 3.
(d) A determination by the city council that the
limitations imposed under this section have been complied with
by the port authority shall be conclusive.
(e) Limitations imposed under this section must not be
applied in a manner that impairs the security of any bonds
issued or contracts executed prior to the imposition of the
limitation. The city council shall not modify any limitations
in effect at the time any bonds or obligations are issued or
contracts executed to the detriment of the holder of the bonds
or obligations or any contracting party.
Subd. 3. [PROCEDURAL REQUIREMENT.] (a) The creation of a
port authority by the city of Rosemount must be by written
resolution known as the enabling resolution. Prior to adoption
of the enabling resolution, the city council shall conduct a
public hearing. Notice of the time and place of hearing, a
statement of the purpose of the hearing, and a summary of the
resolution must be published in a newspaper of general
circulation within the city once a week for two consecutive
weeks. The first publication must appear not more than 30 days
from the date of the public hearing.
(b) All modifications to the enabling resolution must be by
written resolution and must be adopted after notice is given and
a public hearing conducted as required for the original adoption
of the enabling resolution.
Subd. 4. [NAME.] Notwithstanding any law to the contrary,
the city may choose the name of the commission.
Subd. 5. [REMOVAL OF COMMISSIONERS FOR CAUSE.] A
commissioner of the port authority may be removed by the city
council for inefficiency, neglect of duty, or misconduct in
office. A commissioner shall be removed only after a hearing.
A copy of the charges must be given to the commissioner at least
ten days before the hearing. The commissioner must be given an
opportunity to be heard in person or by counsel at the hearing.
When written charges have been submitted against a commissioner,
the city council may temporarily suspend the commissioner. If
the city council finds that those charges have not been
substantiated, the commissioner shall be immediately reinstated.
If a commissioner is removed, a record of the proceedings,
together with the charges and findings, shall be filed in the
office of the city clerk.
Subd. 6. [EFFECTIVE DATE.] This section is effective for
the city of Rosemount the day after compliance with Minnesota
Statutes, section 645.021, subdivision 3, by the governing body
of the city of Rosemount.
Sec. 18. Laws 1974, chapter 285, section 4, as amended by
Laws 1989, chapter 328, article 4, section 6, is amended to read:
Sec. 4. [ISSUANCE OF BONDS.]
To finance the programs authorized in section 2, 2a, and 3
of this act, the governing body of the city may by resolution
authorize, issue, and sell general obligation bonds of the
city in accordance with the provisions of Minnesota Statutes,
Chapter 475 without submission of the question to the electors
of the city, notwithstanding any provision of the city charter
or local ordinance. Minnesota Statutes, chapter 475, applies to
the issuances of bonds. The total amount of all bonds
outstanding for the programs shall not exceed $25,000,000. The
amount of all bonds issued shall be included in excluded from
the net indebtedness of the city for the purpose of any charter
or statutory debt limitation.
Sec. 19. [PENNINGTON COUNTY; THIEF RIVER FALLS; STUDENT
HOUSING.]
Subdivision 1. Pennington county or the city of Thief
River Falls may construct and own student housing in the county
or city. The county or city may incur debt as provided by
Minnesota Statutes, chapter 475, to finance the cost of the
student housing, which is a purpose like other purposes stated
in Minnesota Statutes, section 475.52. Payment of the debt may
be secured by either or both the pledge of revenue from the
housing or the pledge of the full faith and credit of the county
or city. An election is not necessary to authorize obligations
issued under the authority provided by this section.
Subd. 2. Subdivision 1 takes effect separately for
Pennington county and the city of Thief River Falls upon
compliance with Minnesota Statutes, section 645.021, subdivision
3, by their respective governing bodies.
Subd. 3. Property taxes may not be levied under this
section until the 1992 levy, payable in 1993 and thereafter.
Sec. 20. [VALIDATION OF INDEPENDENT SCHOOL DISTRICT NO.
625 BONDS.]
Subdivision 1. [VALIDATION.] The sale of general
obligation school bonds under the authority of Laws 1990,
chapter 604, article 8, section 10, by independent school
district No. 625 pursuant to resolution adopted by two-thirds
majority vote of all the members of its board of directors on
April 16, 1991, is validated.
Subd. 2. [EFFECTIVE DATE.] This section is effective the
day after the governing body of independent school district No.
625 complies with Minnesota Statutes, section 645.021,
subdivision 3.
Sec. 21. [STILLWATER; PROMISSORY NOTES; REASSESSMENT;
AGREEMENT.]
Subdivision 1. [NOTES.] The city of Stillwater may issue
and sell general obligation promissory notes to finance the
payment of ad valorem taxes due and payable in 1991 and prior
years, and all interest and penalties due with respect to them,
on all or part of the following described real estate: Outlots
M, N, O, P, V and X, OAK GLEN; Lots 1-8 inclusive, Lots 13-16
inclusive, Lots 21, 28, 29, 32 and 33, Lots 35-39 inclusive, and
Lots 42, 43, 45 and 46, Block 1, OAK GLEN; Lots 7 and 12, Block
4, OAK GLEN; Lots 8 and 11, Block 5, OAK GLEN; Lots 1, 24, 26,
27, 29, 31, 34 and 36, Block 1, OAK GLEN 6TH ADDITION; and Lot
3, Block 4, and Lots 1 and 2, Block 5, OAK GLEN TOWNHOUSE PLAT
NO. 1; Washington County, Minnesota. The notes shall be issued,
sold, and secured as provided by Minnesota Statutes, chapter
475, except that they may be authorized by resolution adopted by
a four-fifths vote of the city council without an election, and
they may be sold at public or private sale. The portion of the
special assessments levied pursuant to subdivision 2
representing taxes, interest, and penalties may be pledged to
the payment of the notes.
Subd. 2. [REASSESSMENT.] The city may also undertake to
reassess the cost of its local improvement No. 184 with respect
to all lots for which, on the date of reassessment, special
assessments previously levied for local improvement No. 184 have
not been paid in full; and, at the same time, to specially
assess on the lots all delinquent taxes, interest, and penalties
paid by the city with respect to them. Specifically, the amount
to be reassessed or assessed on each lot or parcel may include:
(a) the principal amount of all such special assessments then
unpaid; (b) all interest accrued on the principal amount; and
(c) all ad valorem taxes, interest, and penalties paid by the
city pursuant to subdivisions 1 and 3 with respect to the lot or
parcel. Except as provided in this section, the special
assessments shall be levied and administered and otherwise
subject to Minnesota Statutes, chapter 429. Upon certification
of the assessment roll to the county auditor pursuant to
Minnesota Statutes, section 429.061, together with a duplicate
original of the agreement entered into with respect to them
pursuant to subdivision 3, and payment of all ad valorem taxes
due and payable in 1991 and prior years and all interest and
penalties due with respect to them with respect to any lot or
parcel described in the assessment roll, all special
assessments, ad valorem taxes, interest, and penalties due or
past due on the lot or parcel shall be deemed no longer
delinquent, all tax sales previously held with respect to the
lot or parcel shall be deemed null and void and no longer of any
effect, and all public records relating to it shall be changed
accordingly. All taxes, interest, and penalties so paid shall
be distributed immediately to the local government units
entitled to them by law. Special assessments levied pursuant to
this section shall constitute a first and prior lien on the lots
or parcels on which they are levied.
Subd. 3. [AGREEMENT AMONG CITY, OWNER, MORTGAGEES.] The
city shall, before issuing any promissory notes or conducting
any reassessment or assessment pursuant to subdivisions 1 and 2,
enter into an agreement with the owner and all persons owning
mortgages on the property with respect to which the reassessment
or assessment is to be made, as determined by county records.
The agreement shall:
(a) authorize the reassessment and assessment by the city
and the terms of it;
(b) provide that the amount reassessed or assessed shall
constitute a first and prior lien on the property in question to
the extent and with the same effect as other assessments levied
pursuant to Minnesota Statutes, chapter 429;
(c) waive all rights of the property owner and mortgagees
to published or mailed notice of the proposed reassessment or
assessment and any hearing on it;
(d) waive all rights of the property owner and mortgagees
to contest or appeal from the reassessment or assessment on
procedural grounds or lack of or inadequate special benefit; and
(e) cover other matters as the city deems appropriate.
Subd. 4. [APPLICATION; EFFECTIVE DATE.] This section
applies to the city of Stillwater and is effective the day
following final enactment.
Sec. 22. [DEPARTMENT OF REVENUE; APPROPRIATIONS.]
Subdivision 1. [INCOME TAX SAMPLES.] $76,000 is
appropriated from the general fund to the commissioner of
revenue for purposes of preparing the income tax samples under
Minnesota Statutes, section 270.0681.
Subd. 2. [ADMINISTRATION OF ACT.] There is appropriated
from the general fund to the commissioner of revenue the
following amounts for the administration of this act.
Total
$949,000
Summary By Purpose Fiscal Year Fiscal Year
1992 1993
Mankato Sales Tax $ 56,000 $ 28,000
Rental Car Tax $175,000 $ 20,000
Electronic Funds Transfer $ 50,000 $100,000
Working Family Credit $300,000 $220,000
$581,000 $368,000
Sec. 23. [FOOD BANKS; APPROPRIATION.]
$400,000 is appropriated for fiscal year 1992 and $400,000
is appropriated for fiscal year 1993 from the general fund to
the department of jobs and training for the food banks program
under section 5. All funds appropriated under this section must
be distributed to food banks as provided in section 5 without
deduction by the commissioner for administrative expenses or
other purposes.
Sec. 24. [ENTERPRISE ZONE FUNDING; APPROPRIATION.]
$1,000,000 is appropriated to the commissioner of trade and
economic development to be used to provide additional enterprise
zone allocations for tax reductions under section 15.
Sec. 25. [EFFECTIVE DATE.]
Sections 4 and 10 to 13 are effective the day following
final enactment. Sections 1, 3, and 5 to 7 are effective July
1, 1991.
Presented to the governor May 29, 1991
Signed by the governor May 31, 1991, 4:25 p.m.
Official Publication of the State of Minnesota
Revisor of Statutes