1.1 	A bill for an act
1.2 	relating to transportation; capital investment; taxes; amending provisions 
1.3 	governing transportation finance; establishing gross receipts motor fuels tax; 
1.4 	amending vehicle registration tax and metropolitan area transit sales tax; 
1.5 	amending distribution of highway user fund and county state-aid funding; 
1.6 	authorizing sale and issuance of trunk highway bonds; requiring a report; 
1.7 	appropriating money;amending Minnesota Statutes 2014, sections 16E.15, 
1.8 	subdivision 2; 115A.908; 161.081, subdivision 1; 161.082, subdivision 1, 
1.9 	by adding a subdivision; 161.083; 161.088, subdivisions 3, 4, 5; 161.20, by 
1.10 	adding a subdivision; 161.231; 161.46, subdivision 2; 162.07, subdivision 
1.11 	1a; 168.013, subdivisions 1a, 8; 168.053, subdivision 1; 168.31, by adding a 
1.12 	subdivision; 168.33, subdivisions 2, 7; 168.54, subdivision 5; 168D.06; 174.03, 
1.13 	subdivisions 10, 11; 174.12, subdivision 5; 174.42, by adding a subdivision; 
1.14 	174.52, subdivisions 4a, 5; 222.50, subdivision 7; 270.80, subdivisions 1, 2, 3, 
1.15 	4, by adding subdivisions; 270.81, subdivisions 1, 3, by adding a subdivision; 
1.16 	270.82; 270.83, subdivisions 1, 2; 270.84; 270.86; 270.87; 272.02, subdivision 9; 
1.17 	275.025, subdivisions 1, 4; 296A.061; 296A.11; 296A.12; 296A.16; 297A.815, 
1.18 	subdivision 3; 297A.94; 297A.992, subdivisions 1, 4, 5, 6; 297B.09, subdivision 
1.19 	1; 299D.09; 357.021, subdivision 7; 360.024; 360.305, subdivision 4; 473.167; 
1.20 	473.915; Laws 2014, chapter 312, article 11, section 33; proposing coding for 
1.21 	new law in Minnesota Statutes, chapters 161; 174; 219; 296A; 297A; 299D; 473; 
1.22 	repealing Minnesota Statutes 2014, sections 161.081, subdivision 3; 270.81, 
1.23 	subdivision 4; 270.83, subdivision 3; 473.4051, subdivision 2; Minnesota Rules, 
1.24 	parts 8106.0100, subparts 1, 2, 3, 4, 5, 6, 7, 8, 10, 12, 13, 14, 17, 17a, 18, 19, 
1.25 	20, 21; 8106.0300, subparts 1, 3; 8106.0400; 8106.0500; 8106.0600; 8106.0700; 
1.26 	8106.0800; 8106.9900.
1.27 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.28 	ARTICLE 1
1.29 	TRUNK HIGHWAY BONDING

1.30 	Section 1. BOND SALE AUTHORIZATION.
 1.31 	To provide the money appropriated in this article from the bond proceeds account in 
1.32 	the trunk highway fund, the commissioner of management and budget shall sell and issue 
2.1 	bonds of the state in an amount up to $1,001,000,000 in the manner, upon the terms, and 
2.2 	with the effect prescribed by Minnesota Statutes, sections 167.50 to 167.52, and by the 
2.3 	Minnesota Constitution, article XIV, section 11, at the times and in the amounts requested 
2.4 	by the commissioner of transportation. The proceeds of the bonds, except accrued interest 
2.5 	and any premium received from the sale of the bonds, must be deposited in the bond 
2.6 	proceeds account in the trunk highway fund.

2.7	Sec. 2. BOND APPROPRIATIONS.
 	
2.8 	The sums shown in the column under "Appropriations" are appropriated from the 
2.9 	bond proceeds account in the trunk highway fund to the state agencies or officials indicated, 
2.10 	to be spent for public purposes. Appropriations of bond proceeds must be spent as 
2.11 	authorized by the Minnesota Constitution, articles XI and XIV. Unless otherwise specified, 
2.12 	money appropriated in this article for a capital program or project may be used to pay state 
2.13 	agency staff costs that are attributed directly to the capital program or project in accordance 
2.14 	with accounting policies adopted by the commissioner of management and budget.

2.15	SUMMARY
	
2.16	Department of Transportation
	$
	1,000,000,000
	
2.17	Department of Management and Budget
		1,000,000
	
2.18	TOTAL
	$
	1,001,000,000

2.19						APPROPRIATIONS

2.20
2.21
2.22	Sec. 3. DEPARTMENT OF 
TRANSPORTATION CORRIDORS OF 
COMMERCE
 			$
	800,000,000
	
2.23 	(a) The appropriation in this section is 
2.24 	to the commissioner of transportation for 
2.25 	the corridors of commerce program under 
2.26 	Minnesota Statutes, section 161.088, and is 
2.27 	available in the amounts of $200,000,000 in 
2.28 	each fiscal year from 2016 to 2019.
2.29 	(b) In any fiscal year covered by this 
2.30 	appropriation, the commissioner may 
2.31 	identify projects based on previous selection 
2.32 	processes or may perform a new selection.
2.33 	(c) The appropriation in this section cancels 
2.34 	as specified under Minnesota Statutes, section 
2.35 	16A.642, except that the commissioner of 
3.1 	management and budget shall count the start 
3.2 	of authorization for issuance of state bonds 
3.3 	as the first day of the fiscal year during 
3.4 	which the bonds are available to be issued as 
3.5 	specified under paragraph (a), and not as the 
3.6 	date of enactment of this section.

3.7
3.8	Sec. 4. TRANSPORTATION ECONOMIC 
DEVELOPMENT PROGRAM
 			$
	200,000,000
	
3.9 	(a) This appropriation is for the transportation 
3.10 	economic development program under 
3.11 	Minnesota Statutes, section 174.12, and is 
3.12 	available in the amounts of $50,000,000 in 
3.13 	each fiscal year from 2016 to 2019.
3.14 	(b) The appropriation in this section cancels 
3.15 	as specified under Minnesota Statutes, section 
3.16 	16A.642, except that the commissioner of 
3.17 	management and budget shall count the start 
3.18 	of authorization for issuance of state bonds 
3.19 	as the first day of the fiscal year during 
3.20 	which the bonds are available to be issued as 
3.21 	specified under paragraph (a), and not as the 
3.22 	date of enactment of this section.

3.23	Sec. 5. BOND SALE EXPENSES
 			$
	1,000,000
	
3.24 	This appropriation is to the commissioner 
3.25 	of management and budget for bond sale 
3.26 	expenses under Minnesota Statutes, sections 
3.27 	16A.641, subdivision 8; and 167.50, 
3.28 	subdivision 4.

3.29 	Sec. 6. EFFECTIVE DATE.
 3.30 	This article is effective July 1, 2015.

4.1 	ARTICLE 2
4.2 	GROSS RECEIPTS TAX

4.3 	Section 1. Minnesota Statutes 2014, section 296A.061, is amended to read:
4.4 	296A.061 CANCELLATION OR NONRENEWAL OF LICENSES.
4.5 	The commissioner may cancel a license or not renew a license if one of the following 
4.6 	conditions occurs:
4.7 	(1) the license holder has not filed a petroleum tax return or report for at least one year;
4.8 	(2) the license holder has not filed a gross receipts tax return for at least one year;
4.9 	(3) the license holder has not reported any petroleum tax liability or gross receipts 
4.10 	tax liability on the license holder's returns or reports for at least one year; or
4.11 	(3)(4) the license holder requests cancellation of the license.

4.12 	Sec. 2. [296A.085] MOTOR FUELS GROSS RECEIPTS TAX.
4.13 		Subdivision 1.Imposition. A tax is imposed on the wholesale business of selling 
4.14 	the means or substance used for propelling vehicles on the highways of this state. The tax 
4.15 	is imposed at the rate of 6.5 percent of gross receipts derived by a distributor from the first 
4.16 	sale at wholesale of gasoline, gasoline blended with ethanol, agricultural alcohol gasoline, 
4.17 	and special fuels within this state for use in motor vehicles.
4.18 		Subd. 2.Exemptions. Subdivision 1 does not apply to gasoline, denatured ethanol, 
4.19 	special fuel, or alternative fuel purchased by an entity described in section 296A.07, 
4.20 	subdivision 4, or 296A.08, subdivision 3.
4.21 		Subd. 3.Conversion of tax rate. (a) Annually on or before August 1, the 
4.22 	commissioner shall determine the applicable gross receipts motor fuels tax rate per gallon. 
4.23 	The tax per gallon shall be the greater of either:
4.24 	(1) 6.5 percent of $2.50; or
4.25 	(2) 6.5 percent of the prior fiscal year's average wholesale gasoline price per 
4.26 	gallon in Minnesota for all grades by refiners, as published by the United States Energy 
4.27 	Information Administration and rounded to the nearest tenth of a cent per gallon. The 
4.28 	wholesale price used must not include any tax or fee assessed by the state of Minnesota 
4.29 	or the United States government.
4.30 	(b) The announced rate is effective for a 12-month period consisting of the next 
4.31 	October 1 to September 30. The commissioner shall publish on the department's Web site 
4.32 	the total of the gross receipts tax and the excise tax.
4.33 		Subd. 4.Administrative provisions. Except as otherwise provided in this chapter, 
4.34 	the relevant audit, assessment, refund, penalty, interest, enforcement, collection remedies, 
5.1 	appeal, and administrative provisions of chapter 289A apply to taxes imposed under 
5.2 	this section.
5.3 		Subd. 5.Deposit of revenues. The commissioner shall deposit the revenues from 
5.4 	the gross receipts tax into the highway user tax distribution fund.

5.5 	EFFECTIVE DATE. This section is effective October 1, 2015, and applies to 
5.6 	gross receipts attributable to the described products and derived by a distributor on or 
5.7 	after that day.

5.8 	Sec. 3. Minnesota Statutes 2014, section 296A.11, is amended to read:
5.9 	296A.11 SELLER MAY COLLECT TAX.
5.10 	A person who directly or indirectly pays a gasoline or special fuel tax or motor fuels 
5.11 	gross receipts tax as provided in this chapter and who does not in fact use the gasoline or 
5.12 	special fuel in motor vehicles in this state or receive, store, or withdraw it from storage 
5.13 	to be used personally for the purpose of producing or generating power for propelling 
5.14 	aircraft, but sells or otherwise disposes of the same, except as provided in section 296A.16, 
5.15 	subdivision 3, is hereby authorized to collect, from the person to whom the gasoline or 
5.16 	special fuel is so sold or disposed of, the tax so paid, and is hereby required, upon request, 
5.17 	to make, sign, and deliver to such person an invoice of such sale or disposition. The sums 
5.18 	collected must be held as a special fund in trust for the state of Minnesota.

5.19 	Sec. 4. Minnesota Statutes 2014, section 296A.12, is amended to read:
5.20 	296A.12 GASOLINE AND SPECIAL FUEL TAX AND MOTOR FUELS 
5.21 	GROSS RECEIPTS TAX IN LIEU OF OTHER TAXES.
5.22 	Gasoline and special fuel excise taxes and motor fuels gross receipts tax shall be 
5.23 	in lieu of all other taxes imposed upon the business of selling or dealing in gasoline or 
5.24 	special fuel, whether imposed by the state or by any of its political subdivisions, but are in 
5.25 	addition to all ad valorem taxes now imposed by law. Nothing in this chapter is construed 
5.26 	as prohibiting the governing body of any city of this state from licensing and regulating 
5.27 	sucha business where its authority is conferred by state law or city charter.

5.28 	Sec. 5. Minnesota Statutes 2014, section 296A.16, is amended to read:
5.29 	296A.16 REFUND OR CREDIT.
5.30 		Subdivision 1.Credit or refund of gasoline or special fuel tax paid. The 
5.31 	commissioner shall allow the distributor credit or refund of the excise and motor fuels 
5.32 	gross receipts tax paid on gasoline and special fuel:
6.1 	(1) exported or sold for export from the state, other than in the supply tank of a 
6.2 	motor vehicle or of an aircraft;
6.3 	(2) sold to the United States government to be used exclusively in performing its 
6.4 	governmental functions and activities or to any "cost plus a fixed fee" contractor employed 
6.5 	by the United States government on any national defense project;
6.6 	(3) if the fuel is placed in a tank used exclusively for residential heating;
6.7 	(4) destroyed by accident while in the possession of the distributor;
6.8 	(5) in error;
6.9 	(6) in the case of gasoline only, sold for storage in an on-farm bulk storage tank, if 
6.10 	the tax was not collected on the sale; and
6.11 	(7) in such other cases as the commissioner may permit, consistent with the provisions 
6.12 	of this chapter and other laws relating to the gasoline and special fuel excise taxes.
6.13 		Subd. 2.Fuel used in other vehicle; claim for refund. Any person who buys and 
6.14 	uses gasoline for a qualifying purpose other than use in motor vehicles, snowmobiles 
6.15 	except as provided in clause (2), or motorboats, or special fuel for a qualifying purpose 
6.16 	other than use in licensed motor vehicles, and who paid the excise or gross receipts tax 
6.17 	directly or indirectly through the amount of the tax being included in the price of the 
6.18 	gasoline or special fuel, or otherwise, shall be reimbursed and repaid the amount of the 
6.19 	tax paid upon filing with the commissioner a claim for refund in the form and manner 
6.20 	prescribed by the commissioner, and containing the information the commissioner shall 
6.21 	require. By signing any such claim which is false or fraudulent, the applicant shall be 
6.22 	subject to the penalties provided in this chapter for knowingly making a false claim. 
6.23 	The claim shall set forth the total amount of the gasoline so purchased and used by the 
6.24 	applicant other than in motor vehicles, or special fuel purchased and used by the applicant 
6.25 	other than in licensed motor vehicles, and shall state when and for what purpose it was 
6.26 	used. When a claim contains an error in computation or preparation, the commissioner 
6.27 	is authorized to adjust the claim in accordance with the evidence shown on the claim or 
6.28 	other information available to the commissioner. The commissioner, on being satisfied 
6.29 	that the claimant is entitled to the payments, shall approve the claim and transmit it to the 
6.30 	commissioner of management and budget. The words "gasoline" or "special fuel" as used 
6.31 	in this subdivision do not include aviation gasoline or special fuel for aircraft. Gasoline or 
6.32 	special fuel bought and used for a "qualifying purpose" means:
6.33 	(1) Gasoline or special fuel used in carrying on a trade or business, used on a farm 
6.34 	situated in Minnesota, and used for a farming purpose. "Farm" and "farming purpose" 
6.35 	have the meanings given them in section 6420(c)(2), (3), and (4) of the Internal Revenue 
6.36 	Code as defined in section 289A.02, subdivision 7.
7.1 	(2) Gasoline or special fuel used for off-highway business use.
7.2 	(i) "Off-highway business use" means any use off the public highway by a person in 
7.3 	that person's trade, business, or activity for the production of income.
7.4 	(ii) Off-highway business use includes use of a passenger snowmobile off the public 
7.5 	highways as part of the operations of a resort as defined in section 157.15, subdivision 11; 
7.6 	and use of gasoline or special fuel to operate a power takeoff unit on a vehicle, but not 
7.7 	including fuel consumed during idling time.
7.8 	(iii) Off-highway business use does not include use as a fuel in a motor vehicle 
7.9 	which, at the time of use, is registered or is required to be registered for highway use under 
7.10 	the laws of any state or foreign country; or use of a licensed motor vehicle fuel tank in lieu 
7.11 	of a separate storage tank for storing fuel to be used for a qualifying purpose, as defined in 
7.12 	this section. Fuel purchased to be used for a qualifying purpose cannot be placed in the 
7.13 	fuel tank of a licensed motor vehicle and must be stored in a separate supply tank.
7.14 	(3) Gasoline or special fuel placed in the fuel tanks of new motor vehicles, 
7.15 	manufactured in Minnesota, and shipped by interstate carrier to destinations in other 
7.16 	states or foreign countries.
7.17 		Subd. 3.Destruction by accident; refund to dealer. Notwithstanding the 
7.18 	provisions of subdivision 1, the commissioner shall allow a dealer a refund of:
7.19 	(1) the tax paid by the distributor on, or gross receipts from the sale of,  gasoline, 
7.20 	undyed diesel fuel, or undyed kerosene destroyed by accident while in the possession of 
7.21 	the dealer; or
7.22 	(2) the tax paid by a distributor or special fuels dealer on, or gross receipts from the 
7.23 	sale of,  other special fuels destroyed by accident while in the possession of the dealer.
7.24 		Subd. 4.Refrigerator units; refunds. Notwithstanding the provisions of 
7.25 	subdivision 1, the commissioner shall allow a special fuel dealer a refund of the tax paid 
7.26 	on, or gross receipts from the sale of,  fuel sold directly into a supply tank of a refrigeration 
7.27 	unit with a separate engine and used exclusively by that refrigeration unit. A claim for 
7.28 	refund may be filed as provided in this section.
7.29 		Subd. 4a.Undyed kerosene; refunds. Notwithstanding subdivision 1, the 
7.30 	commissioner shall allow a refund of the tax paid on, or gross receipts from the sale of,  
7.31 	undyed kerosene used exclusively for a purpose other than as fuel for a motor vehicle 
7.32 	using the streets and highways. To obtain a refund, the person making the sale to an end 
7.33 	user must meet the Internal Revenue Service requirements for sales from a blocked pump. 
7.34 	A claim for a refund may be filed as provided in this section.
7.35 		Subd. 4b.Racing gasoline; refunds. Notwithstanding subdivision 1, the 
7.36 	commissioner shall allow a licensed distributor a refund of the tax paid on, or gross 
8.1 	receipts from the sale of,  leaded gasoline of 110 octane or more that does not meet ASTM 
8.2 	specification D4814 for gasoline and that is sold in bulk for use in nonregistered motor 
8.3 	vehicles. A claim for a refund may be filed as provided for in this section.
8.4 		Subd. 5.Qualifying service station credit. Notwithstanding any other provision of 
8.5 	law to the contrary, the tax imposed on gasoline, undyed diesel fuel, or undyed kerosene, 
8.6 	together with the amount attributable to gross receipts tax on these fuels,  delivered to a 
8.7 	qualified service station may not exceed, or must be reduced to, a rate not more than 
8.8 	three cents per gallon above the state tax rate imposed on such products sold by a service 
8.9 	station in a contiguous state located within the distance indicated in this subdivision. A 
8.10 	distributor shall be allowed a credit or refund for the amount of reduction computed in 
8.11 	accordance with this subdivision. For purposes of this subdivision, a "qualifying service 
8.12 	station" means a service station located within 7.5 miles, measured by the shortest route 
8.13 	by public road, from a service station selling like product in the contiguous state.
8.14 		Subd. 7.Civil penalty for filing false claim. A person who violates section 
8.15 	296A.23, subdivision 1, shall forfeit the full amount of the claim. In addition, a person who 
8.16 	is convicted under section 296A.23 for filing a false statement or claim shall, in addition 
8.17 	to any criminal penalties imposed, be prohibited from filing with the commissioner any 
8.18 	claim for refund upon gasoline purchased within six months after such conviction.
8.19 		Subd. 8.Appropriation. There is appropriated to the persons entitled to refund or 
8.20 	credit under this section, from the fund or account in the state treasury to which the money 
8.21 	was credited, an amount sufficient to make the credit or refund.

8.22 	Sec. 6. REVISOR'S INSTRUCTION.
 8.23 	In Minnesota Statutes, the revisor of statutes shall rename Minnesota Statutes, 
8.24 	chapter 296A, to be "Tax on Petroleum and Other Fuels; Gross Receipts Tax."

8.25 	ARTICLE 3
8.26 	VEHICLE REGISTRATION TAX

8.27 	Section 1. Minnesota Statutes 2014, section 168.013, subdivision 1a, is amended to read:
8.28 		Subd. 1a.Passenger automobile; hearse. (a) On passenger automobiles as defined 
8.29 	in section 168.002, subdivision 24, and hearses, except as otherwise provided, the tax 
8.30 	shall be an amount equal to a combination of the following: $10  for those vehicles with 
8.31 	registration periods beginning on or before June 30, 2018; and $20 for those vehicles 
8.32 	with registration periods on or after July 1, 2018, plus an additional tax equal to 1.25 a 
8.33 	percentage of 1.5 percent of the base value as specified in paragraph (h).
9.1 	(b) Subject to the classification provisions herein, "base value" means the 
9.2 	manufacturer's suggested retail price of the vehicle including destination charge using list 
9.3 	price information published by the manufacturer or determined by the registrar if no 
9.4 	suggested retail price exists, and shall not include the cost of each accessory or item of 
9.5 	optional equipment separately added to the vehicle and the suggested retail price.
9.6 	(c) If the manufacturer's list price information contains a single vehicle identification 
9.7 	number followed by various descriptions and suggested retail prices, the registrar shall 
9.8 	select from those listings only the lowest price for determining base value.
9.9 	(d) If unable to determine the base value because the vehicle is specially constructed, 
9.10 	or for any other reason, the registrar may establish such value upon the cost price to the 
9.11 	purchaser or owner as evidenced by a certificate of cost but not including Minnesota sales 
9.12 	or use tax or any local sales or other local tax.
9.13 	(e) The registrar shall classify every vehicle in its proper base value class as follows:

9.14		FROM
		TO
	
9.15	$
	0
		$ 199.99
	
9.16	$
	200
		$ 399.99
	
9.17 	and thereafter a series of classes successively set in brackets having a spread of $200 
9.18 	consisting of such number of classes as will permit classification of all vehicles.
9.19 	(f) The base value for purposes of this section shall be the middle point between 
9.20 	the extremes of its class.
9.21 	(g) The registrar shall establish the base value, when new, of every passenger 
9.22 	automobile and hearse registered prior to the effective date of Extra Session Laws 1971, 
9.23 	chapter 31, using list price information published by the manufacturer or any nationally 
9.24 	recognized firm or association compiling such data for the automotive industry. If unable 
9.25 	to ascertain the base value of any registered vehicle in the foregoing manner, the registrar 
9.26 	may use any other available source or method. The registrar shall calculate tax using base 
9.27 	value information available to dealers and deputy registrars at the time the application for 
9.28 	registration is submitted. The tax on all previously registered vehicles shall be computed 
9.29 	upon the base value thus determined taking into account the depreciation provisions of 
9.30 	paragraph (h).
9.31 	(h) The annual additional tax must be computed upon athe specified percentage of 
9.32 	1.5 percent of the base value as follows: during the first year of vehicle life, upon 100 
9.33 	percent of the base value; for the second year, 90 percent of such value; for the third year, 
9.34 	80 percent of such value; for the fourth year, 70 percent of such value; for the fifth year, 60 
9.35 	percent of such value; for the sixth year, 50 percent of such value; for the seventh year, 
9.36 	40 percent of such value; for the eighth year, 30 percent of such value; for the ninth 
10.1 	year, 20 percent of such value; for the tenth year, ten percent of such value; for the 11th 
10.2 	and each succeeding year, the sum of $25.
10.3 	(i) In no event shall the annual additional tax be less than $25.
10.4 	(j) For any vehicle previously registered in Minnesota, the annual additional tax 
10.5 	due under this subdivision must not exceed the smallest amount of annual additional 
10.6 	tax previously paid or due on the vehicle.

10.7 	EFFECTIVE DATE. This section is effective the day following final enactment 
10.8 	and applies to any tax for a registration period that begins on or after September 1, 2015.

10.9 	ARTICLE 4
10.10 	METROPOLITAN TRANSIT IMPROVEMENT AREA SALES TAX

10.11 	Section 1. Minnesota Statutes 2014, section 297A.992, subdivision 1, is amended to 
10.12 	read:
10.13 		Subdivision 1.Definitions. For purposes of this section, the following terms have 
10.14 	the meanings given them:
10.15 	(1) "metropolitan transportation area" means the counties participating in the joint 
10.16 	powers agreement under subdivision 3;
10.17 	(2) "eligible county" means the county of Anoka, Carver, Dakota, Hennepin, 
10.18 	Ramsey, Scott, or Washington; and
10.19 	(3) "committee" means the Grant Evaluation and Ranking System (GEARS) 
10.20 	Committee;
10.21 	(4) "minimum guarantee county" means any metropolitan county or eligible county 
10.22 	that is participating in the joint powers agreement under subdivision 3, whose proportion 
10.23 	of the annual sales tax revenue under this section collected within that county is less 
10.24 	than or equal to three percent; and
10.25 	(5) "population" means the population, as defined in section 477A.011, subdivision 
10.26 	3, estimated or established by July 15 of the year prior to the calendar year in which 
10.27 	the representatives will serve on the Grant Evaluation and Ranking System Committee 
10.28 	established under subdivision 5.

10.29 	Sec. 2. Minnesota Statutes 2014, section 297A.992, subdivision 4, is amended to read:
10.30 		Subd. 4.Joint powers board. (a) The joint powers board must consist of one 
10.31 	or more commissioners of each county that is in the metropolitan transportation area, 
10.32 	appointed by its county board, and the chair of the Metropolitan Council, who must have 
11.1 	voting rights, subject to subdivision 3, clause (4). The joint powers board has the powers 
11.2 	and duties provided in this section and section 471.59.
11.3 	(b) The joint powers board may utilize no more than three-fourths of one percent of 
11.4 	the proceeds of the taxes imposed under this section for ordinary administrative expenses 
11.5 	incurred in carrying out the provisions of this section. Any additional administrative 
11.6 	expenses must be paid by the participating counties.
11.7 	(c) The joint powers board may establish a technical advisory group that is separate 
11.8 	from the GEARS Committee. The group must consist of representatives of cities, counties, 
11.9 	or public agencies, including the Metropolitan Council. The technical advisory group 
11.10 	must be used solely for technical consultation purposes.

11.11 	Sec. 3. Minnesota Statutes 2014, section 297A.992, subdivision 5, is amended to read:
11.12 		Subd. 5.Grant application and awards; Grant Evaluation and Ranking System 
11.13 	(GEARS) Committee. (a) The joint powers board shall establish a grant application 
11.14 	process and identify the amount of available funding for grant awards. Grant applications 
11.15 	must be submitted in a form prescribed by the joint powers board. An applicant must 
11.16 	provide, in addition to all other information required by the joint powers board, the 
11.17 	estimated cost of the project, the amount of the grant sought, possible sources of funding 
11.18 	in addition to the grant sought, and identification of any federal funds that will be utilized 
11.19 	if the grant is awarded. A grant application seeking transit capital funding must identify 
11.20 	the source of money necessary to operate the transit improvement.
11.21 	(b) The joint powers board shall establish a timeline and procedures for the award of 
11.22 	grants, and may award grants only to the state and political subdivisions. The board shall 
11.23 	define objective criteria for the award of grants, which must include, but not be limited to, 
11.24 	consistency with the most recent version of the transportation policy plan adopted by the 
11.25 	Metropolitan Council under section 473.146. The joint powers board shall maximize the 
11.26 	availability and use of federal funds in projects funded under this section.
11.27 	(c) The joint powers board shall establish a GEARS Committee, which must consist 
11.28 	of:
11.29 	(1) one county commissioner from each county that is in the metropolitan 
11.30 	transportation area, appointed by its county board;
11.31 	(2) one elected city representative from each county that is in the metropolitan 
11.32 	transportation area;
11.33 	(3) one additional elected city representative from each county for every additional 
11.34 	400,000 in population, or fraction of 400,000, in the county that is above 400,000 in 
11.35 	population; and
12.1 	(4) the chair of the Metropolitan Council Transportation Committee.
12.2 	(d) Each city representative must be elected at a meeting of cities in the metropolitan 
12.3 	transportation area, which must be convened for that purpose by the Association of 
12.4 	Metropolitan Municipalities.
12.5 	(e) The committee shall evaluate grant applications following objective criteria 
12.6 	established by the joint powers board, and must provide to the joint powers board a 
12.7 	selection list of transportation projects that includes a priority ranking.
12.8 	(f) A grant award for a transit project located within the metropolitan area, as defined 
12.9 	in section 473.121, subdivision 2, may be funded only after the Metropolitan Council 
12.10 	reviews the project for consistency with the transit portion of the Metropolitan Council 
12.11 	policy plan and one of the following occurs:
12.12 	(1) the Metropolitan Council finds the project to be consistent;
12.13 	(2) the Metropolitan Council initially finds the project to be inconsistent, but after a 
12.14 	good faith effort to resolve the inconsistency through negotiations with the joint powers 
12.15 	board, agrees that the grant award may be funded; or
12.16 	(3) the Metropolitan Council finds the project to be inconsistent, and submits the 
12.17 	consistency issue for final determination to a panel, which determines the project to be 
12.18 	consistent. The panel is composed of a member appointed by the chair of the Metropolitan 
12.19 	Council, a member appointed by the joint powers board, and a member agreed upon by 
12.20 	both the chair and the joint powers board.
12.21 	(g) (d) Grants must be funded by the proceeds of the taxes imposed under this 
12.22 	section and under section 297A.9925, bonds, notes, or other obligations issued by the 
12.23 	joint powers board under subdivision 7.
12.24 	(h) Notwithstanding the provisions of this section except subdivision 6a, of 
12.25 	the revenue collected under this section, the joint powers board shall allocate to the 
12.26 	Metropolitan Council, in fiscal years 2012 and 2013, an amount not less than 75 percent of 
12.27 	the net cost of operations for those transitways that were receiving metropolitan sales tax 
12.28 	funds through an operating grant agreement on June 30, 2011.
12.29 	(i) The Metropolitan Council shall expend any funds allocated under paragraph (h) 
12.30 	for the operations of the specified transitways solely within those counties that are in the 
12.31 	metropolitan transportation area.
12.32 	(j) (e) Nothing in paragraph (h) or (i) this section prevents grant awards to 
12.33 	the Metropolitan Council for capital and operating assistance for transitways and 
12.34 	park-and-ride facilities.

12.35 	Sec. 4. Minnesota Statutes 2014, section 297A.992, subdivision 6, is amended to read:
13.1 		Subd. 6.Allocation of grant awards. (a) The board must allocate grant awards 
13.2 	only for the following transit purposes:
13.3 	(i) (1) capital improvements to transitways, including, but not limited to, highway 
13.4 	bus rapid transit, commuter rail rolling stock, light rail vehicles, and transitway buses, 
13.5 	provided that the 40 percent maximum does not apply to Robert Street transitway or 
13.6 	Riverview corridor;
13.7 	(ii) (2) capital costs for park-and-ride facilities, as defined in section 174.256, 
13.8 	subdivision 2;
13.9 	(iii) (3) feasibility studies, planning, alternatives analyses, environmental studies, 
13.10 	engineering, property acquisition for transitway purposes, and construction of transitways; 
13.11 	and
13.12 	(iv) (4) 50 percent of net operating assistance for  cost of transitways that commenced 
13.13 	revenue operations before September 30, 2015;
13.14 	(5) 100 percent of net operating cost of the Robert Street transitway; and 
13.15 	(6) capital and operating costs for any transitway improvement or transitway with 
13.16 	total grant awards under this clause not to exceed tax proceeds remitted under section 
13.17 	299A.9925, subdivision 4, clause (1). Only the Metropolitan Council or a county located 
13.18 	in the metropolitan transportation area may apply for a grant under this clause.
13.19 	(b) The joint powers board must annually award grants to each minimum guarantee 
13.20 	county in an amount no less than the amount of sales tax revenue collected within that 
13.21 	county.
13.22 	(c) No more than 1.25 percent of the total awards may be annually allocated for 
13.23 	planning, studies, design, construction, maintenance, and operation of pedestrian programs 
13.24 	and bicycle programs and pathways.

13.25 	Sec. 5. [297A.9925] METROPOLITAN TRANSIT IMPROVEMENT AREA 
13.26 	TRANSIT SALES AND USE TAX; RATE; IMPOSITION; USES; PRIORITIES.
13.27 		Subdivision 1.Definitions. For purposes of this section, the following terms have 
13.28 	the following meanings:
13.29 	(1) "metropolitan transit improvement area" or "area" means the counties of Anoka, 
13.30 	Dakota, Hennepin, Ramsey, and Washington;
13.31 	(2) "Metropolitan Council" or "council" means the Metropolitan Council established 
13.32 	by section 473.123; and
13.33 	(3) "local governmental unit" means any county, city, town, school district, special 
13.34 	district, or other political subdivisions or public corporation, other than the council or a 
14.1 	metropolitan agency, lying in whole or in part within the metropolitan transit improvement 
14.2 	area.
14.3 		Subd. 2.Metropolitan transit improvement area transit sales tax imposition; 
14.4 	rate. (a) Notwithstanding section 297A.99, subdivisions 1, 2, and 3, 477A.016, or any 
14.5 	other law, a metropolitan area transit sales and use tax is imposed at a rate of three-quarters 
14.6 	of one percent on retail sales and uses taxable under this chapter occurring within the 
14.7 	metropolitan transit improvement area.
14.8 	(b) The taxes imposed under this subdivision are not included in determining if the 
14.9 	total tax on lodging in the city of Minneapolis exceeds the maximum allowed tax under 
14.10 	Laws 1986, chapter 396, section 5, as amended by Laws 2001, First Special Session 
14.11 	chapter 5, article 12, section 87, and Laws 2012, chapter 299, article 3, section 3, or in 
14.12 	determining a tax that may be imposed under any other limitations.
14.13 		Subd. 3.Administration; collection; enforcement. Except as otherwise provided 
14.14 	in this section, the provisions of section 297A.99, subdivisions 4 and 6 to 12a, govern the 
14.15 	administration, collection, and enforcement of the tax authorized under this section.
14.16 		Subd. 4.Distribution of net revenues. After deducting costs of collection and other 
14.17 	costs under section 297A.99, subdivision 11, the commissioner of revenue shall remit:
14.18 	(1) to the Counties Transit Improvement Board, an amount equal to 8.5 percent of 
14.19 	the net proceeds of the tax imposed under subdivision 2; and 
14.20 	(2) to the Metropolitan Council, the remaining proceeds.
14.21 		Subd. 5.General purpose; consistency with transportation policy plan. (a) The 
14.22 	Metropolitan Council shall utilize the proceeds of the tax imposed under subdivision 
14.23 	2 for transit purposes described under subdivision 7, within the metropolitan transit 
14.24 	improvement area.
14.25 	(b) Projects funded with the metropolitan transit improvement area transit sales and 
14.26 	use tax proceeds must be consistent with the long-range transportation policy plan adopted 
14.27 	by the council under section 473.146 and located within the transit improvement area.
14.28 		Subd. 6.Priorities. The council shall allocate revenues from the taxes imposed 
14.29 	under this section in conformance with the following priority order:
14.30 	(1) payment of debt service necessary for the fiscal year on bonds or other 
14.31 	obligations secured by revenues from the tax imposed in this section;
14.32 	(2) proportional distribution of an amount equal to one-eighth of the total net 
14.33 	proceeds of the taxes imposed under subdivision 2 and under section 297A.992, 
14.34 	subdivision 2, so that the share of each county in the metropolitan transit improvement 
14.35 	area is based on the proportion of taxes generated in that county. Grant awards under 
14.36 	this clause must be used by Hennepin County only for transit purposes, but by all other 
15.1 	counties for any transit purpose or any transportation purpose that has a nexus to transit or 
15.2 	transit-oriented development; and 
15.3 	(3) as otherwise authorized under subdivision 7.
15.4 		Subd. 7.Use of tax proceeds. (a) After deducting the amount necessary under 
15.5 	subdivision 6, clauses (1) and (2), the council shall allocate remaining revenues from the 
15.6 	tax imposed in this section for the following purposes:
15.7 	(1) operating and capital costs to preserve existing bus services that are in 
15.8 	conformance with regional transit performance standards as specified in the council's 
15.9 	transportation policy plan;
15.10 	(2) 100 percent of the net operating costs of arterial bus rapid transit lines in operation 
15.11 	on September 30, 2015, and 50 percent of the net operating costs of other transitways;
15.12 	(3) grants required under paragraph (b);
15.13 	(4) operating and capital costs for transit expansion in accordance with the transit 
15.14 	portion of the council's policy transit plan, including, but not limited to:
15.15 	(i) expansion and upgrades of regular route and commuter bus service provided 
15.16 	by metropolitan transit and replacement services under section 473.388, with overall 
15.17 	expansion of service by an annual average rate of four percent;
15.18 	(ii) development of arterial bus rapid transit, transitways, and streetcar systems; and
15.19 	(iii) maintenance of affordable transit fares;
15.20 	(5) operating and capital costs for expansion and improvement of regional 
15.21 	transitways and streetcars;
15.22 	(6) to transit authorities to establish, replace, or modify transit shelters to conform 
15.23 	with design specifications and maintenance requirements within the meaning of section 
15.24 	473.41; 
15.25 	(7) to the Center for Transportation Studies, University of Minnesota, $500,000 
15.26 	annually for research to improve accessibility, operational efficiency, and safety of transit 
15.27 	systems; and
15.28 	(8) any other costs payable in accordance with subdivisions 5, 6, and 7, which 
15.29 	may include, but are not limited to, transit operations, capital improvements, design, 
15.30 	engineering and environmental work, acquisition of real property, transit planning and 
15.31 	feasibility studies, and to provide grants to local governmental units for transit purposes, 
15.32 	including streetcars, or for bicycle and pedestrian projects.
15.33 	(b) The council shall make available an amount equal to ten percent of the revenues 
15.34 	from the tax imposed in this section and in section 297A.992 through grants to local 
15.35 	units of government within the metropolitan transit improvement area for construction 
15.36 	and maintenance of regional bicycle, trail, and pedestrian infrastructure for safe routes to 
16.1 	school infrastructure and for active transportation programs under section 174.38. The 
16.2 	council shall establish a grant program, criteria, and oversight procedures.

16.3 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
16.4 	September 30, 2015, and applies in the counties of Anoka, Dakota, Hennepin, Ramsey, 
16.5 	and Washington.

16.6 	Sec. 6.  REPEALER.
 16.7 	Minnesota Statutes 2014, section 473.4051, subdivision 2, is repealed.

16.8 	EFFECTIVE DATE. This section is effective July 1, 2015.

16.9 	ARTICLE 5
16.10 	OTHER TAXES, FEES, AND TRANSFERS

16.11 	Section 1. Minnesota Statutes 2014, section 115A.908, is amended to read:
16.12 	115A.908 MOTOR VEHICLE TRANSFER FEE.
16.13 		Subdivision 1.Fee charged. (a) A fee of $10 shall be charged on the initial 
16.14 	registration and each subsequent transfer of title within the state, other than transfers for 
16.15 	resale purposes, of every motor vehicle weighing more than 1,000 pounds. The fee shall 
16.16 	be collected by the commissioner of public safety. Registration plates or certificates 
16.17 	of title may not be issued by the commissioner of public safety for the ownership or 
16.18 	operation of a motor vehicle subject to the transfer fee unless the fee is paid. The fee may 
16.19 	not be charged on the transfer of:
16.20 	(1) previously registered vehicles if the transfer is to the same person;
16.21 	(2) vehicles subject to the conditions specified in section 297A.70, subdivision 2; or
16.22 	(3) vehicles purchased in another state by a resident of another state if more than 60 
16.23 	days have elapsed after the date of purchase and the purchaser is transferring title to this 
16.24 	state and has become a resident of this state after the purchase.
16.25 	(b) A surcharge of ...... is imposed on each fee charged under paragraph (a).
16.26 		Subd. 2.Deposit of revenue. (a) Fee revenue collected under this section shall be 
16.27 	credited to the environmental fund.
16.28 	(b) The commissioner of transportation shall deposit the proceeds of the surcharge 
16.29 	as follows:
16.30 	(1) 50 percent in the small city streets and bridges account under section 174.54, 
16.31 	subdivision 1; and
17.1 	(2) 50 percent in the larger city streets and bridges account under section 174.54, 
17.2 	subdivision 2.

17.3 	Sec. 2. Minnesota Statutes 2014, section 161.081, subdivision 1, is amended to read:
17.4 		Subdivision 1.Distribution of five percent. (a) Pursuant to article 14, section 5, of 
17.5 	the Constitution, five percent of the net highway user tax distribution fund is set aside, and 
17.6 	apportioned to the county state-aid highway fund.
17.7 	(b) That apportionment is further distributed as follows:
17.8 	(1) 30.5 percent to the town road account created in section 162.081;
17.9 	(2) 16 percent to the town bridge account, which is created in the state treasury 56.5 
17.10 	percent to the county state-aid highway fund, consisting of: (i) 30.5 percent to the town 
17.11 	road account created in section 162.081; (ii) 16 percent to the town bridge account created 
17.12 	in the state treasury; and (iii) ten percent to the county municipal accounts for purposes 
17.13 	described in section 162.08; and
17.14 	(3) 53.5 percent to the flexible highway account created in subdivision 3 (2) 43.5 
17.15 	percent to the municipal state-aid street fund.

17.16 	EFFECTIVE DATE. This section is effective July 1, 2015.

17.17 	Sec. 3. Minnesota Statutes 2014, section 161.082, subdivision 1, is amended to read:
17.18 		Subdivision 1.Creation of account; rules. (a) The county turnback account is 
17.19 	created in the state treasury, consisting of money allotted or appropriated to the account 
17.20 	that will be used for the restoration of trunk highways that have reverted or that will 
17.21 	revert to counties.
17.22 	(b) Except as provided in this section and in section 161.081, all money accruing 
17.23 	to the county turnback account shall be expended in accordance with rules of the 
17.24 	commissioner of transportation in paying a county for the restoration of former trunk 
17.25 	highways, or portions thereof, that have reverted to the county in accordance with law, and 
17.26 	have become a part of the county state-aid highway system.

17.27 	Sec. 4. Minnesota Statutes 2014, section 161.082, is amended by adding a subdivision 
17.28 	to read:
17.29 		Subd. 1a.Budget submission. As part of each biennial budget submission to the 
17.30 	legislature, the commissioner shall include a request for an appropriation to the county 
17.31 	turnback account.

18.1 	Sec. 5. Minnesota Statutes 2014, section 161.083, is amended to read:
18.2 	161.083 MUNICIPAL TURNBACK ACCOUNT, EXPENDITURE.
18.3 		Subdivision 1.Creation of account. The municipal turnback account is created in 
18.4 	the state treasury, consisting of money allotted or appropriated to the account that will 
18.5 	be used for the restoration of trunk highways that have reverted or that will revert to 
18.6 	cities. Except as hereinafter provided in this section, all money accruing to the municipal 
18.7 	turnback account shall be expended in accordance with rules of the commissioner of 
18.8 	transportation in paying a municipality having a population of 5,000 or more for the 
18.9 	reconstruction and improvement of former trunk highways, or portions thereof, that have 
18.10 	reverted to such municipality in accordance with law, and have become a part of the 
18.11 	municipal state-aid street system.
18.12 		Subd. 2.Biennial budget submission. As part of each biennial budget submission 
18.13 	to the legislature, the commissioner shall include a request for an appropriation to the 
18.14 	municipal turnback account.

18.15 	Sec. 6. Minnesota Statutes 2014, section 162.07, subdivision 1a, is amended to read:
18.16 		Subd. 1a.Apportionment sum and excess sum. (a) For purposes of this 
18.17 	subdivision, "distribution amount" means the amount identified in section 162.06, 
18.18 	subdivision 1, after the deductions provided for in section 162.06 for administrative costs, 
18.19 	disaster account, research account, and state park road account.
18.20 	(b) The apportionment sum is calculated by subtracting the excess sum, as calculated 
18.21 	in paragraph (c), from as 68 percent of the distribution amount.
18.22 	(c) The excess sum is calculated as the sum of revenue within 32 percent of the 
18.23 	distribution amount:.
18.24 	(1) attributed to that portion of the gasoline excise tax rate under section 296A.07, 
18.25 	subdivision 3, in excess of 20 cents per gallon, and to that portion of the excise tax rates 
18.26 	in excess of the energy equivalent of a gasoline excise tax rate of 20 cents per gallon 
18.27 	for E85 and M85 under section 296A.07, subdivision 3, and special fuel under section 
18.28 	296A.08, subdivision 2;
18.29 	(2) attributed to a change in the passenger vehicle registration tax under section 
18.30 	168.013, imposed on or after July 1, 2008, that exceeds (i) the amount collected in fiscal 
18.31 	year 2008, multiplied by (ii) the annual average United States Consumer Price Index for 
18.32 	the calendar year previous to the current calendar year, divided by the annual average 
18.33 	United States Consumer Price Index for calendar year 2007; and
18.34 	(3) attributed to that portion of the motor vehicle sales tax revenue in excess of the 
18.35 	percentage allocated to the county state-aid highway fund in fiscal year 2007.
19.1 	(d) For purposes of this subdivision, the United States Consumer Price Index 
19.2 	identified in paragraph (c) is for all urban consumers, United States city average, as 
19.3 	determined by the United States Department of Labor.

19.4 	EFFECTIVE DATE. This section is effective October 1, 2015.

19.5 	Sec. 7. Minnesota Statutes 2014, section 168.33, subdivision 2, is amended to read:
19.6 		Subd. 2.Deputy registrars. (a) The commissioner may appoint, and for cause 
19.7 	discontinue, a deputy registrar for any statutory or home rule charter city as the public 
19.8 	interest and convenience may require, without regard to whether the county auditor of 
19.9 	the county in which the city is situated has been appointed as the deputy registrar for the 
19.10 	county or has been discontinued as the deputy registrar for the county, and without regard 
19.11 	to whether the county in which the city is situated has established a county license bureau 
19.12 	that issues motor vehicle licenses as provided in section 373.32.
19.13 	(b) The commissioner may appoint, and for cause discontinue, a deputy registrar 
19.14 	for any statutory or home rule charter city as the public interest and convenience may 
19.15 	require, if the auditor for the county in which the city is situated chooses not to accept 
19.16 	appointment as the deputy registrar for the county or is discontinued as a deputy registrar, 
19.17 	or if the county in which the city is situated has not established a county license bureau 
19.18 	that issues motor vehicle licenses as provided in section 373.32.
19.19 	(c) The commissioner may appoint, and for cause discontinue, the county auditor of 
19.20 	each county as a deputy registrar.
19.21 	(d) Despite any other provision, a person other than a county auditor or a director 
19.22 	of a county license bureau, who was appointed by the registrar before August 1, 1976, 
19.23 	as a deputy registrar for any statutory or home rule charter city, may continue to serve 
19.24 	as deputy registrar and may be discontinued for cause only by the commissioner. The 
19.25 	county auditor who appointed the deputy registrars is responsible for the acts of deputy 
19.26 	registrars appointed by the auditor.
19.27 	(e) Each deputy, before entering upon the discharge of duties, shall take and 
19.28 	subscribe an oath to faithfully discharge the duties and to uphold the laws of the state.
19.29 	(f) If a deputy registrar appointed under this subdivision is not an officer or employee 
19.30 	of a county or statutory or home rule charter city, the deputy shall in addition give bond to 
19.31 	the state in the sum of $10,000, or a larger sum as may be required by the commissioner, 
19.32 	conditioned upon the faithful discharge of duties as deputy registrar.
19.33 	(g) A corporation governed by chapter 302A or 317A may be appointed a deputy 
19.34 	registrar. Upon application by an individual serving as a deputy registrar and the giving of 
19.35 	the requisite bond as provided in this subdivision, personally assured by the individual or 
20.1 	another individual approved by the commissioner, a corporation named in an application 
20.2 	then becomes the duly appointed and qualified successor to the deputy registrar.
20.3 	(h) Each deputy registrar appointed under this subdivision shall keep and maintain 
20.4 	office locations approved by the commissioner for the registration of vehicles and the 
20.5 	collection of taxes and fees on vehicles.
20.6 	(i) The deputy registrar shall keep records and make reports to the commissioner as 
20.7 	the commissioner requires. The records must be maintained at the offices of the deputy 
20.8 	registrar. The records and offices of the deputy registrar must at all times be open to the 
20.9 	inspection of the commissioner or the commissioner's agents. The deputy registrar shall 
20.10 	report to the commissioner by the next working day following receipt all registrations 
20.11 	made and taxes and fees collected by the deputy registrar.
20.12 	(j) The filing feefees imposed under subdivision 7, paragraph (a), clauses (1) and 
20.13 	(3),  must be deposited in the treasury of the place for which appointed or, if not a public 
20.14 	official, a deputy shall retain the filing fee fees, but the registration tax and,  any additional 
20.15 	fees for delayed registration the deputy registrar has collected, and the surcharge imposed 
20.16 	under subdivision 7, paragraph (a), clause (2),  the deputy registrar shall deposit by the next 
20.17 	working day following receipt in an approved state depository to the credit of the state 
20.18 	through the commissioner of management and budget. The place for which the deputy 
20.19 	registrar is appointed through its governing body must provide the deputy registrar with 
20.20 	facilities and personnel to carry out the duties imposed by this subdivision if the deputy 
20.21 	is a public official. In all other cases, the deputy shall maintain a suitable facility for 
20.22 	serving the public.

20.23 	Sec. 8. Minnesota Statutes 2014, section 168.33, subdivision 7, is amended to read:
20.24 		Subd. 7.Filing fees and surcharge; allocations. (a) In addition to all other 
20.25 	statutory fees and taxes, a filing fee of:
20.26 	(1) a $6 filing fee is imposed on every vehicle registration renewal, excluding pro 
20.27 	rate transactions; and
20.28 	(2) a $10 surcharge is imposed on the fee for every vehicle registration renewal, 
20.29 	excluding pro rate transactions; and
20.30 	(3) a $10 filing fee is imposed on every other type of vehicle transaction, including 
20.31 	pro rate transactions.
20.32 	(b) Notwithstanding paragraph (a):
20.33 	(1) a filing fee may not be charged for a document returned for a refund or for 
20.34 	a correction of an error made by the Department of Public Safety, a dealer, or a deputy 
20.35 	registrar; and
21.1 	(2) no filing fee or other fee may be charged for the permanent surrender of a title 
21.2 	for a vehicle.
21.3 	(c) The filing fee and surcharge must be shown as a separate item on all registration 
21.4 	renewal notices sent out by the commissioner.
21.5 	(d) The statutory fees and taxes, and the filing fees and surcharge imposed under 
21.6 	paragraph (a) may be paid by credit card or debit card. The deputy registrar may collect a 
21.7 	surcharge on the statutory fees, taxes,  statutory surcharge, and filing fee not greater than 
21.8 	the cost of processing a credit card or debit card transaction, in accordance with emergency 
21.9 	rules established by the commissioner of public safety. The surcharge authorized by this 
21.10 	paragraph must be used to pay the cost of processing credit and debit card transactions.
21.11 	(e) The fees and surcharge collected under this subdivisionparagraph (a) by the 
21.12 	department must be allocated as follows:
21.13 	(1) of the fees collected under paragraph (a), clause (1):
21.14 	(i) $4.50 must be deposited in the vehicle services operating account; and
21.15 	(ii) $1.50 must be deposited:
21.16 	(A) in the driver and vehicle services technology account until sufficient funds have 
21.17 	been deposited in that account to cover all costs of administration, development, and 
21.18 	initial full deployment of the driver and vehicle services information system; and
21.19 	(B) after completion of the deposit of funds under subitem (A) in the vehicle 
21.20 	services operating account; and
21.21 	(2) of the surcharge collected under paragraph (a), clause (2):
21.22 	(i) 50 percent must be deposited in the small city streets and bridges account under 
21.23 	section 174.54, subdivision 1; and
21.24 	(ii) 50 percent must be deposited in the larger city streets and bridges account under 
21.25 	section 174.54, subdivision 2; and
21.26 	(3) of the fees collected under paragraph (a), clause (2) (3):
21.27 	(i) $3.50 must be deposited in the general fund as follows:
21.28 	(A) 50 percent to the small city streets and bridges account under section 174.54, 
21.29 	subdivision 1; and
21.30 	(B) 50 percent to the large city streets and bridges account under section 174.54, 
21.31 	subdivision 2;
21.32 	(ii) $5.00 must be deposited in the vehicle services operating account; and
21.33 	(iii) $1.50 must be deposited:
21.34 	(A) in the driver and vehicle services technology account until sufficient funds have 
21.35 	been deposited in that account to cover all costs of administration, development, and 
21.36 	initial full deployment of the driver and vehicle services information system; and
22.1 	(B) after completion of the deposit of funds under subitem (A) in the vehicle services 
22.2 	operating account.

22.3 	Sec. 9. Minnesota Statutes 2014, section 168.54, subdivision 5, is amended to read:
22.4 		Subd. 5.Proceeds to general fund. The commissioner shall collect the proceeds 
22.5 	of the fee imposed under this section and deposit them in the general fund pursuant to 
22.6 	section 168A.31:
22.7 	(1) 50 percent to the small city streets and bridges account under section 174.54, 
22.8 	subdivision 1; and
22.9 	(2) 50 percent to the larger city streets and bridges account under section 174.54, 
22.10 	subdivision 2.

22.11 	Sec. 10. [174.54] CITY STREETS AND BRIDGES ACCOUNTS.
22.12 		Subdivision 1.Small city streets and bridges account. A small city streets and 
22.13 	bridges account is created as a special revenue account and established in the state 
22.14 	treasury, consisting of money allotted, appropriated, or transferred through gift or grant 
22.15 	for the account. Money in the account must be appropriated to the commissioner of 
22.16 	transportation by law and apportioned among all the cities in the state that are not eligible 
22.17 	to receive municipal state aid and do not receive municipal state aid. The commissioner 
22.18 	shall apportion the money so that each city receives of the total amount the percentage that 
22.19 	its population bears to the total population of small cities in this state. Money apportioned 
22.20 	under this section must be used for construction, improvement, and maintenance of city 
22.21 	streets and bridges.
22.22 		Subd. 2.Larger city streets and bridges account. A larger city streets and bridges 
22.23 	account is created as a special revenue account and established in the state treasury, 
22.24 	consisting of money allotted, appropriated, or transferred through gift or grant for the 
22.25 	account. Money in the account must be appropriated to the commissioner of transportation 
22.26 	by law and apportioned among all the cities in the state that are eligible to receive 
22.27 	municipal state aid. The commissioner shall apportion: (1) 50 percent of the money so 
22.28 	that each city receives of that amount the percentage that its population bears to the total 
22.29 	population of all cities that are eligible to receive municipal state aid; and (2) 50 percent of 
22.30 	the money so that each city receives of that amount the percentage that its money needs, as 
22.31 	determined by the commissioner under section 162.13, subdivision 3, bears to the total 
22.32 	money needs of all cities that are eligible to receive municipal state aid.

22.33 	Sec. 11. Minnesota Statutes 2014, section 297A.815, subdivision 3, is amended to read:
23.1 		Subd. 3.Motor vehicle lease sales tax revenue. (a) For purposes of this subdivision, 
23.2 	"net revenue" means an amount equal to the revenues, including interest and penalties, 
23.3 	collected under this section, during the fiscal year; less $32,000,000 in each fiscal year.
23.4 	(b) On or before June 30 of each fiscal year, the commissioner of revenue shall 
23.5 	estimate the amount of the net revenuerevenues for the current fiscal year, including 
23.6 	interest and penalties collected during the fiscal year under this section.
23.7 	(c)(b) On or after July 1 of the subsequent fiscal year, the commissioner of 
23.8 	management and budget shall transfer the net revenuerevenues as estimated in paragraph 
23.9 	(b)(a) from the general fund, as follows:
23.10 	(1) $9,000,000 annually until January 1, 2015, and 50 percent annually thereafter to 
23.11 	the county state-aid highway fund. 
23.12 	(c) Notwithstanding any other law to the contrary, the commissioner of transportation 
23.13 	shall allocate the funds transferred under this clauseparagraph (b) to the counties in the 
23.14 	metropolitan area, as defined in section 473.121, subdivision 4, excluding the counties of 
23.15 	Hennepin and Ramsey, so that each county shall receive of such amount the percentage 
23.16 	that its population, as defined in section 477A.011, subdivision 3, estimated or established 
23.17 	by July 15 of the year prior to the current calendar year, bears to the total population of the 
23.18 	counties receiving funds under this clause; and
23.19 	(2) the remainder to the greater Minnesota transit account. For the purposes of the 
23.20 	calculation in this paragraph, the population of Hennepin County shall first be multiplied 
23.21 	by 0.25, and the population of Ramsey County shall first be multiplied by 0.5.
23.22 	(d) The revenues transferred under this subdivision do not include the revenues, 
23.23 	including interest and penalties, generated by the sales tax imposed under section 
23.24 	297A.62, subdivision 1a, which must be deposited as provided under the Minnesota 
23.25 	Constitution, article XI, section 15.

23.26 	EFFECTIVE DATE. Paragraphs (a) through (c) are effective January 1, 2016, and 
23.27 	paragraph (d) is effective the day following final enactment.

23.28 	Sec. 12. Minnesota Statutes 2014, section 297B.09, subdivision 1, is amended to read:
23.29 		Subdivision 1.Deposit of revenues. (a) Money collected and received under this 
23.30 	chapter must be deposited as provided in this subdivision.
23.31 	(b) 60 58 percent of the money collected and received must be deposited in the 
23.32 	highway user tax distribution fund, 36 34 percent must be deposited in the metropolitan 
23.33 	area transit account under section 16A.88, and four eight percent must be deposited in the 
23.34 	greater Minnesota transit account under section 16A.88.
24.1 	(c) It is the intent of the legislature that the allocations under paragraph (b) remain 
24.2 	unchanged for fiscal year 2012 and all subsequent fiscal years.

24.3 	Sec. 13. GREATER MINNESOTA TRANSIT APPROPRIATION.
 24.4 	$...... is appropriated from the general fund to the commissioner of transportation 
24.5 	in each of fiscal years 2016 and 2017, for assistance to transit systems outside the 
24.6 	metropolitan area under Minnesota Statutes, section 174.24.

24.7 	Sec. 14.  REPEALER.
 24.8 	Minnesota Statutes 2014, section 161.081, subdivision 3, is repealed.

24.9 	EFFECTIVE DATE. This section is effective July 1, 2015.

24.10 	ARTICLE 6
24.11 	RAILROAD RECODIFICATION

24.12 	Section 1. Minnesota Statutes 2014, section 270.80, subdivision 1, is amended to read:
24.13 		Subdivision 1.Applicability. The following words and phrases when used 
24.14 	in sections 270.80 273.3712 to 270.87 273.3719, unless the context clearly indicates 
24.15 	otherwise, have the meanings ascribed to them in this section.

24.16 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
24.17 	thereafter.

24.18 	Sec. 2. Minnesota Statutes 2014, section 270.80, subdivision 2, is amended to read:
24.19 		Subd. 2.Railroad company. "Railroad company" means:
24.20 	(1) any company which as a common carrier operates a railroad or a line or lines of 
24.21 	railway railroad situated within or partly within Minnesota; or
24.22 	(2) any company owning or operating, other than as a common carrier, a railway 
24.23 	principally used for transportation of taconite concentrates from the plant at which the 
24.24 	taconite concentrates are produced in shipping form to a point of consumption or port 
24.25 	for shipment beyond the state; or
24.26 	(3) any company that produces concentrates from taconite and transports that 
24.27 	taconite in the course of the concentrating process and before the concentrating process is 
24.28 	completed to a concentrating plant located within the state over a railroad that is not a 
24.29 	common carrier and shall does not use a common carrier or taconite railroad company as 
24.30 	defined in clause (2) for the movement of the concentrate to a point of consumption or 
24.31 	port for shipment beyond the state.

25.1 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
25.2 	thereafter.

25.3 	Sec. 3. Minnesota Statutes 2014, section 270.80, subdivision 3, is amended to read:
25.4 		Subd. 3.Operating property. "Operating property" means all property owned 
25.5 	or used by a railroad company in the performance of railroad transportation services, 
25.6 	including without limitation franchises, rights-of-way, bridges, trestles, shops, docks, 
25.7 	wharves, buildings and structures, but not limited to, roads, locomotives, freight cars, 
25.8 	and improvements on leased property. Operating property is listed and assessed by the 
25.9 	commissioner where the property is located.

25.10 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
25.11 	thereafter.

25.12 	Sec. 4. Minnesota Statutes 2014, section 270.80, subdivision 4, is amended to read:
25.13 		Subd. 4.Nonoperating property. "Nonoperating property" means and includes all 
25.14 	property other than property defined in subdivision 3. Nonoperating property shall include 
25.15 	includes real property which that is leased or rented or available for lease or rent to any 
25.16 	person which that is not a railroad company. Vacant land shall be presumed to be available 
25.17 	for lease or rent if it has not been used as operating property for a period of one year 
25.18 	immediately preceding the valuation date. Nonoperating property also includes land which 
25.19 	that is not necessary and integral to the performance of railroad transportation services 
25.20 	and which that is not used on a regular and continual basis in the performance of these 
25.21 	services. Nonoperating property also includes that portion of a general corporation office 
25.22 	building and its proportionate share of land which that is not used for railway railroad 
25.23 	operation or purpose. Nonoperating property is assessed by the local or county assessor.

25.24 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
25.25 	thereafter.

25.26 	Sec. 5. Minnesota Statutes 2014, section 270.80, is amended by adding a subdivision 
25.27 	to read:
25.28 		Subd. 6.Company. "Company" means any corporation, limited liability company, 
25.29 	association, partnership, trust, estate, fiduciary, public or private organization of any kind, 
25.30 	or any other legal entity.

25.31 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
25.32 	thereafter.

26.1 	Sec. 6. Minnesota Statutes 2014, section 270.80, is amended by adding a subdivision 
26.2 	to read:
26.3 		Subd. 7.Unit value. "Unit value" means the value of the whole integrated system 
26.4 	of a railroad company operating as a going concern without regard to the value of its 
26.5 	component parts.

26.6 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
26.7 	thereafter.

26.8 	Sec. 7. Minnesota Statutes 2014, section 270.80, is amended by adding a subdivision 
26.9 	to read:
26.10 		Subd. 8.Book depreciation. "Book depreciation" means the accumulated 
26.11 	depreciation shown by a railroad company on its books or allowed to the company by 
26.12 	the Surface Transportation Board.

26.13 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
26.14 	thereafter.

26.15 	Sec. 8. Minnesota Statutes 2014, section 270.80, is amended by adding a subdivision 
26.16 	to read:
26.17 		Subd. 9.Equalization. "Equalization" means the adjustment of the estimated value 
26.18 	of railroad operating property to the apparent sales ratio of commercial and industrial 
26.19 	property.

26.20 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
26.21 	thereafter.

26.22 	Sec. 9. Minnesota Statutes 2014, section 270.80, is amended by adding a subdivision 
26.23 	to read:
26.24 		Subd. 10.Exempt property. "Exempt property" means property which is 
26.25 	nontaxable for ad valorem tax purposes under Minnesota Statutes, including personal 
26.26 	property exempt from taxation under chapter 272.

26.27 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
26.28 	thereafter.

26.29 	Sec. 10. Minnesota Statutes 2014, section 270.80, is amended by adding a subdivision 
26.30 	to read:
27.1 		Subd. 11.Original cost. "Original cost" means the amount paid for an asset by the 
27.2 	current owner as recorded on the railroad's books or allowed by the Surface Transportation 
27.3 	Board.

27.4 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
27.5 	thereafter.

27.6 	Sec. 11. Minnesota Statutes 2014, section 270.80, is amended by adding a subdivision 
27.7 	to read:
27.8 		Subd. 12.System. "System" means the total property, real and personal, of a 
27.9 	railroad, that is used in its railroad operations.

27.10 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
27.11 	thereafter.

27.12 	Sec. 12. Minnesota Statutes 2014, section 270.80, is amended by adding a subdivision 
27.13 	to read:
27.14 		Subd. 14.Minnesota allocated value. "Minnesota allocated value" means the value 
27.15 	of a railroad company's operating property that is assigned to Minnesota for tax purposes.

27.16 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
27.17 	thereafter.

27.18 	Sec. 13. Minnesota Statutes 2014, section 270.81, subdivision 1, is amended to read:
27.19 		Subdivision 1.Valuation of operating property. The operating property of every 
27.20 	railroad company doing business in Minnesota shall be valued by the commissioner in the 
27.21 	manner prescribed by sections 270.80 273.3712 to 270.87 273.3719.

27.22 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
27.23 	thereafter.

27.24 	Sec. 14. Minnesota Statutes 2014, section 270.81, subdivision 3, is amended to read:
27.25 		Subd. 3.Determination of type of property. (a) The commissioner shall have has 
27.26 	exclusive primary jurisdiction to determine what whether railroad property is operating 
27.27 	property and what is or nonoperating property. In making such the determination, the 
27.28 	commissioner shall may solicit information and opinions from outside the department 
27.29 	and afford all interested persons an opportunity to submit data or views on the subject 
27.30 	in writing or orally.
28.1 	(b) Local and county assessors may submit written requests to the commissioner, 
28.2 	asking for a determination of the nature of specific whether property owned by a 
28.3 	railroad and located within their assessing jurisdiction is operating or nonoperating. Any 
28.4 	determination made by the commissioner may be appealed by the assessor to the Tax Court 
28.5 	pursuant to chapter 271. The requests must be submitted by April 1 of the assessing year. 
28.6 	The commissioner must send the assessor a written determination by May 1. Assessors may 
28.7 	appeal determinations made by the commissioner to the Tax Court pursuant to chapter 271.

28.8 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
28.9 	thereafter.

28.10 	Sec. 15. Minnesota Statutes 2014, section 270.81, is amended by adding a subdivision 
28.11 	to read:
28.12 		Subd. 6.Deduction for nonoperating and exempt property. Property that was part 
28.13 	of the system, but is nonoperating property, or that is exempt from ad valorem taxation, is 
28.14 	excluded from the Minnesota allocated value under section 273.3718, subdivision 1a. Only 
28.15 	qualifying property located in Minnesota may be deducted from the Minnesota allocated 
28.16 	value. The commissioner must deduct the market value of the property to be excluded. This 
28.17 	must be calculated by multiplying the book value of the property by the market-to-book 
28.18 	ratio of the unit. The company has the burden of proof to establish that property should 
28.19 	be excluded from the Minnesota allocated value. The railroad company must submit 
28.20 	schedules of exempt or nonoperating property as the commissioner may require. The 
28.21 	remaining amount after this deduction is the Minnesota apportionable market value.

28.22 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
28.23 	thereafter.

28.24 	Sec. 16. Minnesota Statutes 2014, section 270.82, is amended to read:
28.25 	270.82 REPORTS OF RAILROAD COMPANIES.
28.26 		Subdivision 1.Annual report required. Before March 31, every railroad company 
28.27 	doing business in Minnesota shall annually must file with the commissioner on or before 
28.28 	March 31 a an annual report under oath setting forth the information prescribed by the 
28.29 	commissioner to enable the commissioner to make the valuation and equalization required 
28.30 	by sections 270.80 273.3712 to 270.87. 273.3719. The commissioner shall prescribe the 
28.31 	content, format, and manner of the report pursuant to section 270C.30. If a report is made 
28.32 	by electronic means, the taxpayer's signature is defined pursuant to section 270C.304, 
28.33 	except that a "law administered by the commissioner" includes the property tax laws.
29.1 		Subd. 2.Extension of time. If the commissioner for good determines that there is 
29.2 	reasonable cause, the commissioner may extend the time for filing the report required by 
29.3 	subdivision 1 for up to 15 days the time for filing the report required by subdivision 1.
29.4 		Subd. 3.Amended reports. A railroad company may file an amended report to 
29.5 	correct or add information to the original report. Amended reports must be filed with 
29.6 	the commissioner by April 30.
29.7 		Subd. 4.Failure to file reports. (a) The commissioner may make the valuation 
29.8 	provided for by sections 273.3712 to 237.3719, according to the commissioner's best 
29.9 	judgment based on available information, if any railroad company does not:
29.10 	(1) make the report required by this section;
29.11 	(2) permit an inspection and examination of its property, records, books, accounts, 
29.12 	or other papers when requested by the commissioner; or
29.13 	(3) appear before the commissioner or a person appointed under section 273.3715, 
29.14 	when required to do so.
29.15 	(b) If the commissioner makes the valuation pursuant to paragraph (a), the 
29.16 	commissioner's valuation is final. Notwithstanding any other law to the contrary, 
29.17 	the commissioner's valuation made pursuant to this subdivision is not appealable 
29.18 	administratively.

29.19 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
29.20 	thereafter.

29.21 	Sec. 17. Minnesota Statutes 2014, section 270.83, subdivision 1, is amended to read:
29.22 		Subdivision 1.Powers of commissioner. The commissioner shall have has the 
29.23 	power to examine or cause to be examined any books, papers, records, or memoranda 
29.24 	relevant to the determination of the valuation of operating property as herein provided. 
29.25 	The commissioner shall have the further power to may require the attendance of any 
29.26 	person having knowledge or information in the premises concerning the valuation of the 
29.27 	operating property, to compel the production of books, papers, records, or memoranda by 
29.28 	persons so required to attend, to take testimony on matters material to such determination 
29.29 	determine the valuation of operating property and administer oaths or affirmations.

29.30 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
29.31 	thereafter.

29.32 	Sec. 18. Minnesota Statutes 2014, section 270.83, subdivision 2, is amended to read:
30.1 		Subd. 2.Appointment of persons; subpoenas. For the purpose of making such 
30.2 	examinations, The commissioner may appoint such persons as the commissioner may 
30.3 	deem deems necessary to make the examinations described in subdivision 1. Such 
30.4 	persons shall have the rights and powers of the examining of Persons appointed may 
30.5 	examine books, papers, records or memoranda, and of subpoenaing subpoena witnesses, 
30.6 	administering administer oaths and affirmations, and taking of take testimony, which are 
30.7 	conferred upon the commissioner hereby. The court administrator of any court of record, 
30.8 	upon demand of any such person appointed, shall issue a subpoena for the attendance of 
30.9 	any witness or the production of any books, papers, records, or memoranda before such 
30.10 	person. The commissioner may also issue subpoenas for the appearance of witnesses 
30.11 	before the commissioner or before such persons. Disobedience of subpoenas so issued 
30.12 	shall be punished by the district court of the district in which the subpoena is issued for a 
30.13 	contempt of the district court. Failure to comply with a subpoena shall be punished in the 
30.14 	same manner as contempt of the district court.

30.15 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
30.16 	thereafter.

30.17 	Sec. 19. Minnesota Statutes 2014, section 270.84, is amended to read:
30.18 	270.84 ANNUAL VALUATION OF OPERATING PROPERTY.
30.19 		Subdivision 1.Annual valuation; rules. (a) Before July 1, the commissioner 
30.20 	shall annually between March 31 and May 31 make a determination of must determine 
30.21 	the fair market value of the operating property of every railroad company doing business 
30.22 	in this state as of January 2 of the year in which the valuation is made. In making 
30.23 	this determination, The commissioner shall must employ generally accepted appraisal 
30.24 	principles and practices which may include the unit method of determining value., and 
30.25 	approaches approved by the Western States Association of Tax Administrators, National 
30.26 	Conference of Unit Valuation States, and the International Association of Assessing 
30.27 	Officers.
30.28 	(b) The unit value of railroad property is the reconciled value considering the cost, 
30.29 	income, and market approaches under subdivisions 1a, 1b, and 1c. Each approach must 
30.30 	be weighted in accordance with the reliability of the information and the commissioner's 
30.31 	judgment.
30.32 		Subd. 1a.Cost approach. (a) The commissioner may use the cost approach, 
30.33 	including but not limited to original cost less book depreciation and replacement cost 
30.34 	less depreciation.
31.1 	(b) Book depreciation is allowed as a deduction from an original cost model. Book 
31.2 	depreciation is assumed to include all forms of appraisal depreciation.
31.3 	(c) Explicitly calculated appraisal depreciation, including physical, functional, and 
31.4 	external obsolescence, is allowed as a deduction from the replacement cost model.
31.5 		Subd. 1b.Income approach. (a) The commissioner may use the income approach, 
31.6 	including but not limited to direct capitalization models and yield capitalization models.
31.7 	(b) The yield rate is calculated using market data on selected comparable companies 
31.8 	in the band of investment method.
31.9 	(1) Discounted cash flows is a yield capitalization model that calculates the present 
31.10 	value of explicit cash flow forecasts capitalized using the yield rate, plus revision to stable 
31.11 	growth yield capitalization after the period of explicit forecasts.
31.12 	(2) Stable growth yield capitalization is a yield capitalization model that calculates 
31.13 	the present value of anticipated future cash flows, capitalized using the yield rate and 
31.14 	considering growth.
31.15 	(c) Direct capitalization is the expected net operating income for the following year, 
31.16 	divided by the direct capitalization rate. The direct capitalization rate is calculated by 
31.17 	using direct market observations from comparable sales or using market earning-to-price 
31.18 	information in the band of investment method.
31.19 		Subd. 1c.Market approach. The commissioner may use the market approach, 
31.20 	including but not limited to a sales comparison model, a stock and debt model, or other 
31.21 	market models that are available and reliable.
31.22 		Subd. 2.Notice. The commissioner, after determining the fair market value of the 
31.23 	operating property of each railroad company, shall give notice to must notify the railroad 
31.24 	company of the valuation by first class mail, overnight delivery, or messenger service.

31.25 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
31.26 	thereafter.

31.27 	Sec. 20. Minnesota Statutes 2014, section 270.86, is amended to read:
31.28 	270.86 APPORTIONMENT AND EQUALIZATION OF VALUATION.
31.29 		Subdivision 1.Apportionment of value. Upon determining After allocating to 
31.30 	Minnesota the fair market value of the operating property of each railroad company, the 
31.31 	commissioner shall must apportion such the value to the respective counties and to the 
31.32 	taxing districts therein in conformity with fair and reasonable rules and standards to be 
31.33 	established by the commissioner pursuant to notice and hearing, except as provided in 
31.34 	section 270.81. In establishing such rules and standards the commissioner may consider 
32.1 	(a) the physical situs of all station houses, depots, docks, wharves, and other buildings and 
32.2 	structures with an original cost in excess of $10,000; (b) the proportion that the length and 
32.3 	type of all the tracks used by the railroad in such county and taxing district bears to the 
32.4 	length and type of all the track used in the state; and (c) other facts as will result in a fair 
32.5 	and equitable apportionment of value the operating parcels in Minnesota.
32.6 	The apportioned market value of each company's operating parcel in Minnesota is 
32.7 	the current original cost of each parcel as of the last assessment date plus original cost 
32.8 	of new construction minus the original cost of property retired since the last assessment 
32.9 	date. The total Minnesota apportionable market value of the railroad is divided by the 
32.10 	total current original cost of the railroad in Minnesota to determine a percentage. The 
32.11 	resulting percentage is multiplied by the current original cost of each parcel to determine 
32.12 	the apportioned market value of each parcel.
32.13 		Subd. 1a.Allocation of value. (a) After the market value of operating property has 
32.14 	been estimated, the portion of value that is attributable to Minnesota must be determined 
32.15 	by calculating an allocation percentage using factors relevant to the industry segment of 
32.16 	the railroad company. The allocation percentage must be multiplied by the value of the 
32.17 	operating property to determine the Minnesota allocated value.
32.18 	(b) The Minnesota allocated value is determined by averaging the following factors:
32.19 	(1) miles of railroad track operated in Minnesota divided by miles of railroad track 
32.20 	operated in all states;
32.21 	(2) ton miles of revenue freight transported in Minnesota divided by ton miles of 
32.22 	revenue freight transported in all states;
32.23 	(3) gross revenues from transportation operations within Minnesota divided by gross 
32.24 	revenues from transportation operations in all states; and
32.25 	(4) cost of railroad property in Minnesota divided by cost of railroad property in 
32.26 	all states.
32.27 	(c) Each of the available factors must be weighted equally.
32.28 		Subd. 2.Equalized valuation. After making the apportionment provided in 
32.29 	subdivision 1, the commissioner shall must determine the equalized valuation of the 
32.30 	operating property in each county by applying to the apportioned value an estimated 
32.31 	current year median sales ratio for all commercial and industrial property in that county. 
32.32 	If the commissioner decides determines that there are insufficient sales to determine a 
32.33 	median commercial-industrial sales ratio, an estimated current year countywide median 
32.34 	sales ratio for all property shall must be applied to the apportioned value. No equalization 
32.35 	shall Equalization must not be made to the market value of the operating property if the 
33.1 	median sales ratio determined pursuant to this subdivision is within five at least 90 but less 
33.2 	than 105 percent of the assessment ratio of the railroad operating property.

33.3 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
33.4 	thereafter.

33.5 	Sec. 21. Minnesota Statutes 2014, section 270.87, is amended to read:
33.6 	270.87 CERTIFICATION TO COUNTY ASSESSORS.
33.7 	After making an annual determination of the equalized fair market value of the 
33.8 	operating property of each company in each of the respective counties, and in the taxing 
33.9 	districts therein, The commissioner shall must certify the equalized fair market value of 
33.10 	the operating property to the county assessor on or before June 30 August 1. The equalized 
33.11 	fair market value of the operating property of the railroad company in the county and the 
33.12 	taxing districts therein is the value on which taxes must be levied and collected in the 
33.13 	same manner as on the commercial and industrial property of such county and the taxing 
33.14 	districts therein in the counties and taxing districts. If the commissioner determines that 
33.15 	the equalized fair market value certified on or before June 30 August 1 is in error, the 
33.16 	commissioner may issue a corrected certification on or before August 31 October 1. The 
33.17 	commissioner may correct errors that are merely clerical in nature until December 31.

33.18 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
33.19 	thereafter.

33.20 	Sec. 22. Minnesota Statutes 2014, section 272.02, subdivision 9, is amended to read:
33.21 		Subd. 9.Personal property; exceptions. Except for the taxable personal property 
33.22 	enumerated below, all personal property and the property described in section 272.03, 
33.23 	subdivision 1, paragraphs (c) and (d), shall be exempt.
33.24 	The following personal property shall be taxable:
33.25 	(a) personal property which is part of an electric generating, transmission, or 
33.26 	distribution system or a pipeline system transporting or distributing water, gas, crude 
33.27 	oil, or petroleum products or mains and pipes used in the distribution of steam or hot or 
33.28 	chilled water for heating or cooling buildings and structures;
33.29 	(b) railroad docks and wharves which are part of thepersonal property that is part of 
33.30 	the operating property of a railroad company as defined in section 270.80 273.3712;
33.31 	(c) personal property defined in section 272.03, subdivision 2, clause (3);
34.1 	(d) leasehold or other personal property interests which are taxed pursuant to section 
34.2 	272.01, subdivision 2; 273.124, subdivision 7; or 273.19, subdivision 1; or any other law 
34.3 	providing the property is taxable as if the lessee or user were the fee owner;
34.4 	(e) manufactured homes and sectional structures, including storage sheds, decks, 
34.5 	and similar removable improvements constructed on the site of a manufactured home, 
34.6 	sectional structure, park trailer or travel trailer as provided in section 273.125, subdivision 
34.7 	8, paragraph (f); and
34.8 	(f) flight property as defined in section 270.071.

34.9 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
34.10 	thereafter.

34.11 	Sec. 23. Minnesota Statutes 2014, section 275.025, subdivision 1, is amended to read:
34.12 		Subdivision 1.Levy amount. The state general levy is levied against 
34.13 	commercial-industrial property and seasonal residential recreational property, as defined in 
34.14 	this section. The state general levy base amount is $592,000,000 $889,600,000 for taxes 
34.15 	payable in 2002 2016. For taxes payable in subsequent years, the levy base amount is 
34.16 	increased each year by multiplying the levy base amount for the prior year by the sum 
34.17 	of one plus the rate of increase, if any, in the implicit price deflator for government 
34.18 	consumption expenditures and gross investment for state and local governments prepared 
34.19 	by the Bureau of Economic Analysts of the United States Department of Commerce for 
34.20 	the 12-month period ending March 31 of the year prior to the year the taxes are payable. 
34.21 	The tax under this section is not treated as a local tax rate under section 469.177 and is not 
34.22 	the levy of a governmental unit under chapters 276A and 473F.
34.23 	The commissioner shall increase or decrease the preliminary or final rate for a year 
34.24 	as necessary to account for errors and tax base changes that affected a preliminary or final 
34.25 	rate for either of the two preceding years. Adjustments are allowed to the extent that the 
34.26 	necessary information is available to the commissioner at the time the rates for a year must 
34.27 	be certified, and for the following reasons:
34.28 	(1) an erroneous report of taxable value by a local official;
34.29 	(2) an erroneous calculation by the commissioner; and
34.30 	(3) an increase or decrease in taxable value for commercial-industrial or seasonal 
34.31 	residential recreational property reported on the abstracts of tax lists submitted under 
34.32 	section 275.29 that was not reported on the abstracts of assessment submitted under 
34.33 	section 270C.89 for the same year.
35.1 	The commissioner may, but need not, make adjustments if the total difference in the tax 
35.2 	levied for the year would be less than $100,000.

35.3 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
35.4 	thereafter.

35.5 	Sec. 24. Minnesota Statutes 2014, section 275.025, subdivision 4, is amended to read:
35.6 		Subd. 4.Apportionment and levy of state general tax. Ninety-five 95.1 percent of 
35.7 	the state general tax must be levied by applying a uniform rate to all commercial-industrial 
35.8 	tax capacity and five 4.9 percent of the state general tax must be levied by applying a 
35.9 	uniform rate to all seasonal residential recreational tax capacity. On or before October 1 
35.10 	each year, the commissioner of revenue shall certify the preliminary state general levy 
35.11 	rates to each county auditor that must be used to prepare the notices of proposed property 
35.12 	taxes for taxes payable in the following year. By January 1 of each year, the commissioner 
35.13 	shall certify the final state general levy rate to each county auditor that shall be used 
35.14 	in spreading taxes.

35.15 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
35.16 	thereafter.

35.17 	Sec. 25. APPROPRIATIONS.
 35.18 	The following sums are appropriated from the general fund to the agency to 
35.19 	implement the provisions of this article as follows: $266,000 in fiscal year 2016, $14,000 
35.20 	in fiscal year 2017, $13,000 in fiscal year 2018, and $11,000 in fiscal year 2019. The sums 
35.21 	indicated in this section for fiscal years 2016, 2017, and 2018 are onetime appropriations 
35.22 	and are not added to the agency's permanent base. The sum indicated in this section for 
35.23 	fiscal year 2019 shall become part of the agency's base.

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

35.25 	Sec. 26. REVISOR'S INSTRUCTION.
 35.26 	The revisor of statutes shall renumber the provisions of Minnesota Statutes listed 
35.27 	in column A to the references listed in column B. The revisor shall also make necessary 
35.28 	cross-reference changes in Minnesota Statutes and Minnesota Rules consistent with 
35.29 	renumbering.

35.30		Column A
	Column B
	
35.31		270.80
	273.3712
	
35.32		270.81
	273.3713
	
36.1		270.82
	273.3714
	
36.2		270.83
	273.3715
	
36.3		270.84
	273.3716
	
36.4		270.85
	273.3717
	
36.5		270.86
	273.3718
	
36.6		270.87
	273.3719

36.7 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
36.8 	thereafter.

36.9 	Sec. 27.  REPEALER.
 36.10 	Minnesota Statutes 2014, sections 270.81, subdivision 4; and 270.83, subdivision 3, 
36.11 	and Minnesota Rules, parts 8106.0100, subparts 1, 2, 3, 4, 5, 6, 7, 8, 10, 12, 13, 14, 17, 
36.12 	17a, 18, 19, 20, and 21; 8106.0300, subparts 1 and 3; 8106.0400; 8106.0500; 8106.0600; 
36.13 	8106.0700; 8106.0800; and 8106.9900, are repealed.

36.14 	EFFECTIVE DATE. This section is effective for assessment year 2016 and 
36.15 	thereafter.

36.16 	ARTICLE 7
36.17 	EFFICIENCY MEASURES

36.18 	Section 1. Minnesota Statutes 2014, section 16E.15, subdivision 2, is amended to read:
36.19 		Subd. 2.Software sale fund. (a) Except as provided in paragraph paragraphs (b) 
36.20 	and (c), proceeds of from the sale or licensing of software products or services by the chief 
36.21 	information officer must be credited to the MN.IT services revolving fund. If a state 
36.22 	agency other than the Office of MN.IT Services has contributed to the development of 
36.23 	software sold or licensed under this section, the chief information officer may reimburse 
36.24 	the agency by discounting computer services provided to that agency.
36.25 	(b) Proceeds of from the sale or licensing of software products or services developed 
36.26 	by the Pollution Control Agency, or custom developed by a vendor for the agency, must be 
36.27 	credited to the environmental fund.
36.28 	(c) Proceeds from the sale or licensing of software products or services developed 
36.29 	by the Department of Transportation, or custom developed by a vendor for the agency, 
36.30 	using trunk highway funds, must be credited to the trunk highway fund.

36.31 	Sec. 2. Minnesota Statutes 2014, section 161.20, is amended by adding a subdivision 
36.32 	to read:
37.1 		Subd. 3a.Transfer of appropriations. With the approval of the commissioner of 
37.2 	management and budget, the commissioner of transportation may transfer unencumbered 
37.3 	balances among appropriations from the trunk highway fund and the state airports fund. 
37.4 	No transfer may be made from appropriations for state road construction, for operations 
37.5 	and maintenance, or for debt service. Transfers under this paragraph may not be made 
37.6 	between funds. Transfers under this paragraph must be reported immediately to the 
37.7 	chairs and ranking minority members of the legislative committees and divisions with 
37.8 	jurisdiction over transportation finance.

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

37.10 	Sec. 3. [161.225] LOANS FOR LAND ACQUISITION FOR HIGHWAY 
37.11 	PROJECTS.
37.12 		Subdivision 1.Account established. The state right-of-way acquisition loan 
37.13 	account is created in the trunk highway fund for the purposes specified in this section. 
37.14 	Money in the account is annually appropriated to the commissioner and does not lapse. 
37.15 	Interest from the investment of money in this account must be deposited in the state 
37.16 	right-of-way acquisition loan account.
37.17 		Subd. 2.Loans. (a) The commissioner may make loans to counties, towns, and 
37.18 	statutory and home rule charter cities to purchase property within the right-of-way of 
37.19 	a state trunk highway shown on an official map adopted pursuant to section 394.361 
37.20 	or 462.359, or to purchase property within the proposed right-of-way of a principal or 
37.21 	intermediate arterial highway. The loans shall be made from the fund established under this 
37.22 	subdivision for purchases approved by the commissioner. The loans shall bear no interest.
37.23 	(b) The commissioner shall make loans only to:
37.24 	(1) accelerate the acquisition of primarily undeveloped property when there 
37.25 	is a reasonable probability that the property will increase in value before highway 
37.26 	construction, and to update an expired environmental impact statement on a project for 
37.27 	which the right-of-way is being purchased;
37.28 	(2) avert the imminent conversion or the granting of approvals which would allow 
37.29 	the conversion of property to uses which would jeopardize its availability for highway 
37.30 	construction;
37.31 	(3) advance planning and environmental activities on highest priority major 
37.32 	metropolitan river crossing projects under the transportation development guide chapter 
37.33 	policy plan; or
38.1 	(4) take advantage of open market opportunities when developed properties become 
38.2 	available for sale, provided all parties involved are agreeable to the sale and funds are 
38.3 	available.
38.4 	(c) The commissioner shall not make loans to purchase property at a price which 
38.5 	exceeds the fair market value of the property or which includes the costs of relocating or 
38.6 	moving persons or property. The eminent domain process may be used to settle differences 
38.7 	of opinion as to fair market value, provided all parties agree to the process.
38.8 	(d) A private property owner may elect to receive the purchase price either 
38.9 	in a lump sum or in not more than four annual installments without interest on the 
38.10 	deferred installments. If the purchase agreement provides for installment payments, 
38.11 	the commissioner shall make the loan in installments corresponding to those in the 
38.12 	purchase agreement. The recipient of an acquisition loan shall convey the property for the 
38.13 	construction of the highway at the same price which the recipient paid for the property. The 
38.14 	price may include the costs of preparing environmental documents that were required for 
38.15 	the acquisition and that were paid for with money that the recipient received from the loan 
38.16 	fund. Upon notification by the commissioner that the plan to construct the highway has been 
38.17 	abandoned or the anticipated location of the highway has changed, the recipient shall sell 
38.18 	the property at market value in accordance with the procedures required for the disposition 
38.19 	of the property. All rents and other money received because of the recipient's ownership 
38.20 	of the property and all proceeds from the conveyance or sale of the property shall be paid 
38.21 	to the commissioner. If a recipient is not permitted to include in the conveyance price the 
38.22 	cost of preparing environmental documents that were required for the acquisition, then the 
38.23 	recipient is not required to repay the commissioner an amount equal to 40 percent of the 
38.24 	money received from the loan fund and spent in preparing the environmental documents.
38.25 	(e) For administration of the loan program, the commissioner may expend from the 
38.26 	fund each year an amount no greater than three percent of the amount of the proceeds for 
38.27 	that year.
38.28 		Subd. 3.Loans for acquisition and relocation. (a) The commissioner may 
38.29 	make loans to acquiring authorities within the metropolitan area to purchase homestead 
38.30 	property located in a proposed state trunk highway right-of-way or project, and to provide 
38.31 	relocation assistance. Acquiring authorities are authorized to accept the loans and to 
38.32 	acquire the property. Except as provided in this subdivision, the loans shall be made as 
38.33 	provided in subdivision 2. Loans shall be in the amount of the fair market value of the 
38.34 	homestead property plus relocation costs and less salvage value. Before construction of 
38.35 	the highway begins, the acquiring authority shall convey the property to the commissioner 
39.1 	at the same price it paid, plus relocation costs and less its salvage value. Acquisition and 
39.2 	assistance under this subdivision must conform to sections 117.50 to 117.56.
39.3 	(b) The commissioner may make loans only when:
39.4 	(1) the owner of affected homestead property requests acquisition and relocation 
39.5 	assistance from an acquiring authority;
39.6 	(2) federal or state financial participation is not available;
39.7 	(3) the owner is unable to sell the homestead property at its appraised market value 
39.8 	because the property is located in a proposed state trunk highway right-of-way or project as 
39.9 	indicated on an official map or plat adopted under section 160.085, 394.361, or 462.359; and
39.10 	(4) the commissioner agrees to and approves the fair market value of the homestead 
39.11 	property, which approval shall not be unreasonably withheld.
39.12 	(c) For purposes of this subdivision, the following terms have the meanings given 
39.13 	them:
39.14 	(1) "acquiring authority" means counties, towns, and statutory and home rule 
39.15 	charter cities;
39.16 	(2) "homestead property" means: (i) a single-family dwelling occupied by the 
39.17 	owner, and the surrounding land, not exceeding a total of ten acres; or (ii) a manufactured 
39.18 	home, as defined in section 327B.01, subdivision 13; and
39.19 	(3) "salvage value" means the probable sale price of the dwelling and other property 
39.20 	that is severable from the land if offered for sale on the condition that it be removed from 
39.21 	the land at the buyer's expense, allowing a reasonable time to find a buyer with knowledge 
39.22 	of the possible uses of the property, including separate use of serviceable components and 
39.23 	scrap when there is no other reasonable prospect of sale.

39.24 	EFFECTIVE DATE. This section is effective January 1, 2016.

39.25 	Sec. 4. Minnesota Statutes 2014, section 161.231, is amended to read:
39.26 	161.231 APPROPRIATION; PROCEEDS FROM LEASED STATE 
39.27 	PROPERTY.
39.28 	There is appropriated annually from the fund or account in the state treasury to which 
39.29 	the rental money from the sale, lease, conveyance, or disposal of state leased property 
39.30 	is credited a sufficient amount of money to carry out the state's obligations under the 
39.31 	provisions of sections 15.16, 117.135, 117.226, 161.16, 161.202,161.23, subdivision 3, 
39.32 	161.24, 161.241, 161.43, 161.433, 161.44, 161.442, and 272.68, subdivision 3, including 
39.33 	the inventorying, marketing, and property management activities required to sell, lease, 
39.34 	rent, permit, convey, or otherwise dispose of the land or the interest in the land. At the 
40.1 	discretion of the commissioner of transportation, money in the account at the end of each 
40.2 	biennium may cancel to the trunk highway fund.

40.3 	Sec. 5. Minnesota Statutes 2014, section 161.46, subdivision 2, is amended to read:
40.4 		Subd. 2.Relocation of facilities; reimbursement. (a) Whenever the commissioner 
40.5 	shall determine the relocation of any utility facility is necessitated by the construction of a 
40.6 	project on the routes of federally aided state trunk highways, including urban extensions 
40.7 	thereof, which routes are included within the National System of Interstate Highways, the 
40.8 	owner or operator of such utility facility shall relocate the same in accordance with the 
40.9 	order of the commissioner. After the completion of such relocation the cost thereof shall 
40.10 	be ascertained and paid by the state out of trunk highway funds; provided, however, the 
40.11 	amount to be paid by the state for such reimbursement shall not exceed the amount on 
40.12 	which the federal government bases its reimbursement for said interstate system.
40.13 	(b) Notwithstanding paragraph (a), any utility facility installed after August 1, 2015, 
40.14 	is not eligible for relocation reimbursement.

40.15 	Sec. 6. Minnesota Statutes 2014, section 168.013, subdivision 8, is amended to read:
40.16 		Subd. 8.Tax proceeds to highway user fund; fee proceeds to vehicle services 
40.17 	account. (a) Unless otherwise specified in this chapter, the net proceeds of the registration 
40.18 	tax imposed under this chapter, including the penalty surcharge for late payment, imposed 
40.19 	in section 168.31, subdivision 1a,  must be collected by the commissioner, paid into the 
40.20 	state treasury, and credited to the highway user tax distribution fund.
40.21 	(b) All fees collected under this chapter, unless otherwise specified, must be 
40.22 	deposited in the vehicle services operating account in the special revenue fund under 
40.23 	section 299A.705.

40.24 	EFFECTIVE DATE. This section is effective July 1, 2015, and applies to vehicle 
40.25 	registration taxes due and unpaid on and after that date.

40.26 	Sec. 7. Minnesota Statutes 2014, section 168.31, is amended by adding a subdivision 
40.27 	to read:
40.28 		Subd. 1a.Penalty surcharge for late payment. Except as otherwise provided in 
40.29 	subdivisions 4 and 4a, a vehicle owner who has failed to pay the tax required under this 
40.30 	chapter on or before the due date shall pay in full the tax due on the vehicle, together with 
40.31 	a penalty surcharge of $25 for each month or portion of a month following the expiration 
40.32 	of the registration period, except that the amount of the late fee may not exceed $100.

41.1 	EFFECTIVE DATE. This section is effective July 1, 2015, and applies to vehicle 
41.2 	registration taxes due and unpaid on and after that date.

41.3 	Sec. 8. [174.53] FEDERAL FUND FLEXIBILITY PROGRAM.
41.4 	The commissioner shall establish a program to allow greater flexibility and 
41.5 	efficiency in the allocation of federal funds for state-aid transportation projects. The 
41.6 	commissioner shall:
41.7 	(1) establish and administer selection criteria and a process under which a local unit 
41.8 	of government that would otherwise receive federal funds for a local transportation project 
41.9 	would be able to finance the project with state funds instead of federal funds;
41.10 	(2) redirect the unused federal funds to transportation projects for which federal 
41.11 	funds could be utilized by the state more efficiently and productively;
41.12 	(3) achieve a reasonable degree of equity among the department districts in 
41.13 	distributing funds under the program; and
41.14 	(4) ensure that the state's receipt of federal funds for transportation projects is not 
41.15 	jeopardized by the program.

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

41.17 	Sec. 9. Minnesota Statutes 2014, section 299D.09, is amended to read:
41.18 	299D.09 ESCORT SERVICE; APPROPRIATION; RECEIPTS.
41.19 	(a) Fees charged for escort services provided by the State Patrol are annually 
41.20 	appropriated to the commissioner of public safety to administer and provide these services.
41.21 	(b) The fee charged for services provided by the State Patrol with a vehicle is $79.28 
41.22 	an hour. The fee charged for services provided without a vehicle is $59.28 an hour 
41.23 	shall be set to recover actual costs as determined by the commissioner of public safety 
41.24 	by July 1 each year.
41.25 	(c) The fees charged for State Patrol flight services are $140 an hour for a fixed wing 
41.26 	aircraft, $490 an hour for a helicopter, and $600 an hour for the Queen Air in fiscal year 
41.27 	2012; and $139.64 an hour for a fixed wing aircraft, $560.83 an hour for a helicopter, and 
41.28 	$454.84 an hour for the Queen Air in fiscal year 2013 and thereafter.

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

41.30 	Sec. 10. Minnesota Statutes 2014, section 360.024, is amended to read:
41.31 	360.024 AIR TRANSPORTATION SERVICE CHARGE.
42.1 	The commissioner shall charge users of air transportation services provided by the 
42.2 	commissioner for direct operating costs, excluding pilot salary and aircraft acquisition 
42.3 	costs. All receipts for these services shall be deposited in the air transportation services 
42.4 	account in the state airports fund and are appropriated to the commissioner to pay these 
42.5 	direct air service operating costs.

42.6 	Sec. 11. Minnesota Statutes 2014, section 473.167, is amended to read:
42.7 	473.167 HIGHWAY AND TRANSIT PROJECTS.
42.8 		Subd. 2.Loans for acquisition. (a) The council may make loans to counties, towns, 
42.9 	and statutory and home rule charter cities within the metropolitan area for the purchase of 
42.10 	property within the right-of-way of a state trunk highway shown on an official map adopted 
42.11 	pursuant to section 394.361 or 462.359or, for the purchase of property within the proposed 
42.12 	right-of-way of a principal or intermediate arterial highway designated by the council as a 
42.13 	part of the metropolitan highway system plan and approved by the council pursuant to 
42.14 	section 473.166, or for the purchase of property needed for proposed transit-related capital 
42.15 	improvements, including transitways designated in the council's most recent transportation 
42.16 	policy plan. The loans shall be made by the council, from the fund established pursuant to 
42.17 	this subdivision, for purchases approved by the council. The loans shall bear no interest.
42.18 	(b) The council shall make loans only:
42.19 	(1) to accelerate the acquisition of primarily undeveloped property when there 
42.20 	is a reasonable probability that the property will increase in value before highway or 
42.21 	transit-related construction, and to update an expired environmental impact statement on 
42.22 	a project for which the right-of-way is being purchased;
42.23 	(2) to avert the imminent conversion or the granting of approvals which would allow 
42.24 	the conversion of property to uses which would jeopardize its availability for highway or 
42.25 	transit-related construction;
42.26 	(3) to advance planning and environmental activities on highest priority major 
42.27 	metropolitan river crossing projects, under the transportation development guide 
42.28 	chapter/policy plan; or
42.29 	(4) to take advantage of open market opportunities when developed properties 
42.30 	become available for sale, provided all parties involved are agreeable to the sale and 
42.31 	funds are available.
42.32 	(c) The council shall not make loans for the purchase of property at a price which 
42.33 	exceeds the fair market value of the property or which includes the costs of relocating or 
42.34 	moving persons or property. The eminent domain process may be used to settle differences 
42.35 	of opinion as to fair market value, provided all parties agree to the process.
43.1 	(d) A private property owner may elect to receive the purchase price either in a 
43.2 	lump sum or in not more than four annual installments without interest on the deferred 
43.3 	installments. If the purchase agreement provides for installment payments, the council 
43.4 	shall make the loan in installments corresponding to those in the purchase agreement. The 
43.5 	recipient of an acquisition loan shall convey the property for the construction of the highway 
43.6 	at the same price which the recipient paid for the property. The price may include the costs 
43.7 	of preparing environmental documents that were required for the acquisition and that were 
43.8 	paid for with money that the recipient received from the loan fund. Upon notification by 
43.9 	the council that the plan to construct the highway or transit project has been abandoned or 
43.10 	the anticipated location of the highway or transit project changed, the recipient shall sell 
43.11 	the property at market value in accordance with the procedures required for the disposition 
43.12 	of the property. All rents and other money received because of the recipient's ownership 
43.13 	of the property and all proceeds from the conveyance or sale of the property shall be paid 
43.14 	to the council. If a recipient is not permitted to include in the conveyance price the cost 
43.15 	of preparing environmental documents that were required for the acquisition, then the 
43.16 	recipient is not required to repay the council an amount equal to 40 percent of the money 
43.17 	received from the loan fund and spent in preparing the environmental documents.
43.18 	(e) The proceeds of the tax authorized by subdivision 3, all money paid to the 
43.19 	council by recipients of loans, and all interest on the proceeds and payments shall be 
43.20 	maintained as a separate fund. For administration of the loan program, the council may 
43.21 	expend from the fund each year an amount no greater than three percent of the amount of 
43.22 	the proceeds for that year.
43.23 		Subd. 2a.Loans for acquisition and relocation. (a) The council may make loans 
43.24 	to acquiring authorities within the metropolitan area to purchase homestead property 
43.25 	located in a proposed state trunk highway right-of-way or project or transit-related project, 
43.26 	and to provide relocation assistance. Acquiring authorities are authorized to accept the 
43.27 	loans and to acquire the property. Except as provided in this subdivision, the loans shall 
43.28 	be made as provided in subdivision 2. Loans shall be in the amount of the fair market 
43.29 	value of the homestead property plus relocation costs and less salvage value. Before 
43.30 	construction of the highway or transit-related project begins, the acquiring authority shall 
43.31 	convey the property to the commissioner of transportation or council at the same price it 
43.32 	paid, plus relocation costs and less its salvage value. Acquisition and assistance under this 
43.33 	subdivision must conform to sections 117.50 to 117.56.
43.34 	(b) The council may make loans only when:
43.35 	(1) the owner of affected homestead property requests acquisition and relocation 
43.36 	assistance from an acquiring authority;
44.1 	(2) federal or state financial participation is not available;
44.2 	(3) the owner is unable to sell the homestead property at its appraised market 
44.3 	value because the property is located in a proposed state trunk highway right-of-way or 
44.4 	project as indicated on an official map or plat adopted under section 160.085, 394.361, 
44.5 	or 462.359, or transit-related project; and
44.6 	(4) the council agrees to and approves the fair market value of the homestead 
44.7 	property, which approval shall not be unreasonably withheld.
44.8 	(c) For purposes of this subdivision, the following terms have the meanings given 
44.9 	them.
44.10 	(1) "Acquiring authority" means counties, towns, and statutory and home rule 
44.11 	charter cities in the metropolitan area.
44.12 	(2) "Homestead property" means: (i) a single-family dwelling occupied by the 
44.13 	owner, and the surrounding land, not exceeding a total of ten acres; or (ii) a manufactured 
44.14 	home, as defined in section 327B.01, subdivision 13.
44.15 	(3) "Salvage value" means the probable sale price of the dwelling and other property 
44.16 	that is severable from the land if offered for sale on the condition that it be removed from 
44.17 	the land at the buyer's expense, allowing a reasonable time to find a buyer with knowledge 
44.18 	of the possible uses of the property, including separate use of serviceable components and 
44.19 	scrap when there is no other reasonable prospect of sale.
44.20 		Subd. 3.Tax. The council may levy a tax on all taxable property in the metropolitan 
44.21 	area, as defined in section 473.121, to provide funds for loans made pursuant to 
44.22 	subdivisions 2 and 2a. This tax for the right-of-way acquisition loan fund shall be certified 
44.23 	by the council, levied, and collected in the manner provided by section 473.13. The tax 
44.24 	shall be in addition to that authorized by section 473.249 and any other law and shall not 
44.25 	affect the amount or rate of taxes which may be levied by the council or any metropolitan 
44.26 	agency or local governmental unit. The amount of the levy shall be as determined and 
44.27 	certified by the council, provided that the tax levied by the Metropolitan Council for the 
44.28 	right-of-way acquisition loan fund shall not exceed $2,828,379 for taxes payable in 2004 
44.29 	and $2,828,379 for taxes payable in 2005. The amount of the levy for taxes payable in 
44.30 	2006 and subsequent years shall not exceed the product of (1) the Metropolitan Council's 
44.31 	property tax levy limitation under this subdivision for the previous year, multiplied by 
44.32 	(2) one plus a percentage equal to the growth in the implicit price deflator as defined 
44.33 	in section 275.70, subdivision 2.
44.34 		Subd. 4.State review. The commissioner of revenue shall certify the council's levy 
44.35 	limitation under this section to the council by August 1 of the levy year. The council must 
44.36 	certify its proposed property tax levy to the commissioner of revenue by September 1 of 
45.1 	the levy year. The commissioner of revenue shall annually determine whether the property 
45.2 	tax for the right-of-way acquisition loan fund certified by the Metropolitan Council for 
45.3 	levy following the adoption of its proposed budget is within the levy limitation imposed 
45.4 	by this section. The determination must be completed prior to September 10 of each year. 
45.5 	If current information regarding market valuation in any county is not transmitted to the 
45.6 	commissioner in a timely manner, the commissioner may estimate the current market 
45.7 	valuation within that county for purposes of making the calculation.

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

45.9 	Sec. 12. Laws 2014, chapter 312, article 11, section 33, is amended to read:
45.10 	Sec. 33. TRANSPORTATION EFFICIENCIES.
 45.11 	(a) The commissioner of transportation shall include in the report under Minnesota 
45.12 	Statutes, section 174.56, due by December 15, 2015, information on efficiencies 
45.13 	implemented in fiscal year 2015 in planning and project management and delivery, 
45.14 	along with an explanation of the efficiencies employed to achieve the savings and the 
45.15 	methodology used in the calculations. The level of savings achieved must equal, in 
45.16 	comparison with the total state road construction budget for that year, a minimum of five 
45.17 	percent in fiscal year 2015. The report must identify the projects that have been advanced 
45.18 	or completed due to the implementation of efficiency measures.
45.19 	(b) The commissioner shall identify in the report those recommendations from the 
45.20 	Transportation Strategic Management and Operations Advisory Task Force Report dated 
45.21 	January 23, 2009, submitted to the legislature by the Departments of Administration 
45.22 	and Transportation, as required by Laws 2008, chapter 152, article 6, section 9, 
45.23 	that the commissioner has implemented, with a description of current status of the 
45.24 	recommendation and results of implementation.
45.25 	(c) The commissioner shall present in the report plans to incorporate greater 
45.26 	efficiencies in department operation and decision-making, including, but not limited to, 
45.27 	the following: financing innovations, mode choice in project selection and design, land 
45.28 	use planning, return on investment calculation, project delivery, including selection of 
45.29 	materials and decreasing project delivery time, and efficiencies in multiagency permitting.

45.30 	Sec. 13. APPROPRIATION.
 45.31 	$....... is appropriated from the trunk highway fund to the commissioner of 
45.32 	transportation for deposit in the state right-of-way acquisition loan account under 
45.33 	Minnesota Statutes, section 161.225.

46.1 	EFFECTIVE DATE. This section is effective January 1, 2016.

46.2 	ARTICLE 8
46.3 	TRANSPORTATION POLICY

46.4 	Section 1. Minnesota Statutes 2014, section 161.088, subdivision 3, is amended to read:
46.5 		Subd. 3.Project classification. The commissioner shall determine whether each 
46.6 	candidate project can be classified into at least one of the following classifications:
46.7 	(1) capacity development, for a project on a segment of a trunk highway where the 
46.8 	segment:
46.9 	(i) is not a divided highway, and that highway is an expressway or freeway beyond 
46.10 	the project limits;
46.11 	(ii) contains a highway terminus that lacks an intersection or interchange with 
46.12 	another trunk highway;
46.13 	(iii) contains fewer lanes of travel compared to that highway beyond the project 
46.14 	limits; or
46.15 	(iv) contains a location that is proposed as a new interchange or to be reconstructed 
46.16 	from an intersection to an interchange; or
46.17 	(2) freight improvement, for an asset preservation or replacement project that can 
46.18 	result in:
46.19 	(i) removing or reducing barriers to commerce;
46.20 	(ii) easing or preserving freight movement;
46.21 	(iii) supporting emerging industries; or
46.22 	(iv) providing connections between the trunk highway system and other 
46.23 	transportation modes for the movement of freight; or
46.24 	(3) main street improvement, for a project on a segment of trunk highway passing 
46.25 	through a city center, in order to:
46.26 	(i) restore or improve economic vitality; and
46.27 	(ii) improve safety for all road users.

46.28 	Sec. 2. Minnesota Statutes 2014, section 161.088, subdivision 4, is amended to read:
46.29 		Subd. 4.Project eligibility. (a) The commissioner shall establish eligibility 
46.30 	requirements for projects that can be funded under the program. Eligibility must include:
46.31 	(1) consistency with the statewide multimodal transportation plan under section 
46.32 	174.03;
46.33 	(2) location of the project on an interregional corridor, for a project located outside 
46.34 	of the Department of Transportation metropolitan district, or within a city;
47.1 	(3) placement into at least one project classification under subdivision 3;
47.2 	(4) a maximum length of time, as determined by the commissioner, until 
47.3 	commencement of construction work on the project; and
47.4 	(5) for each type of project classification under subdivision 3, a maximum allowable 
47.5 	amount for the total project cost estimate, as determined by the commissioner with 
47.6 	available data.
47.7 	(b) A project whose construction is programmed in the state transportation 
47.8 	improvement program is not eligible for funding under the program. This paragraph does 
47.9 	not apply to a project that is programmed as result of selection under this section.
47.10 	(c) A project may be, but is not required to be, identified in the 20-year state highway 
47.11 	capital investment plan under section 174.03.

47.12 	Sec. 3. Minnesota Statutes 2014, section 161.088, subdivision 5, is amended to read:
47.13 		Subd. 5.Project selection process; criteria. (a) The commissioner shall establish a 
47.14 	process for identification, evaluation, and selection of projects under the program.
47.15 	(b) As part of the project selection process, the commissioner shall annually accept 
47.16 	recommendations on candidate projects from area transportation partnerships and other 
47.17 	interested stakeholders in each Department of Transportation district. For each candidate 
47.18 	project identified under this paragraph, the commissioner shall determine eligibility, 
47.19 	classify, and if appropriate, evaluate the project for the program.
47.20 	(c) Project evaluation and prioritization must be performed on the basis of objective 
47.21 	criteria, which must include:
47.22 	(1) a return on investment measure that provides for comparison across eligible 
47.23 	projects;
47.24 	(2) measurable impacts on commerce and economic competitiveness;
47.25 	(3) efficiency in the movement of freight, including but not limited to:
47.26 	(i) measures of annual average daily traffic and commercial vehicle miles traveled, 
47.27 	which may include data near the project location on that trunk highway or on connecting 
47.28 	trunk and local highways; and
47.29 	(ii) measures of congestion or travel time reliability, which may be within or near 
47.30 	the project limits, or both;
47.31 	(4) improvements to traffic safety for all road users;
47.32 	(5) connections tobetween and within regional trade centers, and connections with 
47.33 	local highway systems, and other transportation modes;
47.34 	(6) the extent to which the project addresses multiple transportation system policy 
47.35 	objectives and principles; and
48.1 	(7) support and consensus for the project among members of the surrounding 
48.2 	community.
48.3 	(d) As part of the project selection process, the commissioner may divide funding 
48.4 	to be separately available among projects within each classification under subdivision 3, 
48.5 	and may apply separate or modified criteria among those projects falling within each 
48.6 	classification.

48.7 	Sec. 4. [161.317] MADE IN AMERICA.
48.8 	In all highway construction and maintenance projects, the commissioner shall, to 
48.9 	the greatest extent feasible, utilize products, materials, and equipment that are made in 
48.10 	America and shall include this requirement in the department's contract specifications.

48.11 	Sec. 5. Minnesota Statutes 2014, section 168.053, subdivision 1, is amended to read:
48.12 		Subdivision 1.Application; fee; penalty. Any person, firm, or corporation with 
48.13 	a business located in Minnesota engaged in the business of transporting motor vehicles 
48.14 	owned by another, by delivering, by drive-away or towing methods, either singly or by 
48.15 	means of the full mount method, the saddle mount method, the tow bar method, or any other 
48.16 	combination thereof, and under their own power, vehicles over the highways of the state 
48.17 	from the manufacturer or any other point of origin, to any point of destination, within or 
48.18 	without the state, shall make application to the registrar for a drive-away in-transit license. 
48.19 	This application for annual license shall be accompanied by a registration fee of $250 and 
48.20 	contain information the registrar may require. Upon the filing of the application and the 
48.21 	payment of the fee, the registrar shall issue to each drive-away operator a drive-away 
48.22 	in-transit license plate, which must be carried and displayed on the power unit consistent 
48.23 	with section 169.79 and the plate shall remain on the vehicle while being operated within 
48.24 	Minnesota transported. The license plate issued under this subdivision is not valid for the 
48.25 	purpose of permanent vehicle registration and is not valid outside Minnesota. Additional 
48.26 	drive-away in-transit license plates desired by any drive-away operator may be secured 
48.27 	from the registrar of motor vehicles upon the payment of a fee of $5 for each set of 
48.28 	additional license plates. Any person, firm, or corporation engaging in the business as a 
48.29 	drive-away operator, of transporting and delivering by means of full mount method, the 
48.30 	saddle mount method, the tow bar method, or any combination thereof, and under their 
48.31 	own power, motor vehicles, who fails or refuses to file or cause to be filed an application, 
48.32 	as is required by law, and to pay the fees therefor as the law requires, shall be found guilty 
48.33 	of violating the provisions of sections 168.053 to 168.057; and, upon conviction, fined 
49.1 	not less than $50, and not more than $100, and all costs of court. Each day so operating 
49.2 	without securing the license and plates as required shall constitute a separate offense.

49.3 	Sec. 6. Minnesota Statutes 2014, section 168D.06, is amended to read:
49.4 	168D.06 FUEL LICENSE FEES.
49.5 	License fees paid to the commissioner under the International Fuel Tax Agreement 
49.6 	must be deposited in the vehicle services operating account in the special revenue fund 
49.7 	under section 299A.705. The commissioner shall charge an annual fuel license fee of 
49.8 	$15, and an annual application filing fee of $13 for quarterly reporting of fuel tax, and a 
49.9 	reinstatement fee of $100 to reinstate a revoked International Fuel Tax Agreement license.

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

49.11 	Sec. 7. Minnesota Statutes 2014, section 174.03, subdivision 10, is amended to read:
49.12 		Subd. 10.Highway construction training; report. (a) The commissioner of 
49.13 	transportation shall utilize the maximum feasible amount of all federal funds available to 
49.14 	this state under United States Code, title 23, section 140, paragraph (b), to develop, conduct, 
49.15 	and administer highway construction training, including skill improvement programs.
49.16 	(b) The commissioner of transportation must report by February 1 of each 
49.17 	odd-numbered year to the house of representatives and senate committees having 
49.18 	jurisdiction over transportation policy and finance concerning the commissioner's 
49.19 	compliance with paragraph (a). The report must, with respect to each of the two previous 
49.20 	calendar years year:
49.21 	(1) describe the highway construction training and skill improvement programs the 
49.22 	commissioner has conducted and administered;
49.23 	(2) analyze the results of the commissioner's training programs;
49.24 	(3) state the amount of federal funds available to this state under United States Code, 
49.25 	title 23, section 140, paragraph (b); and
49.26 	(4) identify the amount spent by the commissioner in conducting and administering 
49.27 	the programs.

49.28 	Sec. 8. Minnesota Statutes 2014, section 174.03, subdivision 11, is amended to read:
49.29 		Subd. 11.Disadvantaged business enterprise program; report. (a) The 
49.30 	commissioner shall include in each contract that is funded at least in part by federal funds, 
49.31 	a sanction for each contractor who does not meet the established project disadvantaged 
49.32 	business enterprise goal or demonstrate good-faith effort to meet the goal.
50.1 	(b) The commissioner of transportation shall report by February 1 of each 
50.2 	odd-numbered year to the house of representatives and senate committees having 
50.3 	jurisdiction over transportation policy and finance concerning the commissioner's 
50.4 	disadvantaged business enterprise program. The report must, with respect to each of the 
50.5 	two previous calendar years year:
50.6 	(1) state the department's annual overall goal, compared with the percentage attained;
50.7 	(2) explain the methodology, applicable facts, and public participation used to 
50.8 	establish the overall goal;
50.9 	(3) describe good-faith efforts to meet the goal, if the goal was not attained;
50.10 	(4) describe actions to address overconcentration of disadvantaged business 
50.11 	enterprises in certain types of work;
50.12 	(5) state the number of contracts that included disadvantaged business enterprise 
50.13 	goals, the number of contractors that met established disadvantaged business enterprise 
50.14 	goals, and sanctions imposed for lack of good-faith effort; and
50.15 	(6) describe contracts with no disadvantaged business enterprise goals, and, of 
50.16 	those, state number of contracts and amount of each contract with targeted groups under 
50.17 	section 16C.16.

50.18 	Sec. 9. Minnesota Statutes 2014, section 174.12, subdivision 5, is amended to read:
50.19 		Subd. 5.Financial assistance; criteria. The commissioners of transportation and 
50.20 	employment and economic development shall establish criteria for evaluating projects 
50.21 	for financial assistance under this section. At a minimum, the criteria must provide an 
50.22 	objective method to prioritize and select projects on the basis of:
50.23 	(1) the extent to which the project provides measurable economic benefit 
50.24 	in accordance with the performance measures developed by the commissioner of 
50.25 	employment and economic development under subdivision 4;
50.26 	(2) consistency with relevant state and local transportation plans;
50.27 	(3) the availability and commitment of funding or in-kind assistance for the project 
50.28 	from nonpublic or nonstate sources;
50.29 	(4) the need for the project as part of the overall transportation system;
50.30 	(5) the extent to which completion of the project will improve the movement of 
50.31 	people and freight; and
50.32 	(6) the extent to which the project promotes access to jobs and employment centers 
50.33 	and connections between modes of transportation; and
50.34 	(6) (7) geographic balance as required under subdivision 7, paragraph (b).

51.1 	Sec. 10. [174.38] ACTIVE TRANSPORTATION PROGRAMS.
51.2 		Subdivision 1.Definitions. (a) For purposes of this section, the following terms 
51.3 	have the meanings given them.
51.4 	(b) "Administering authority" or "authority" means the commissioner of 
51.5 	transportation, the joint powers board under section 297A.992, or the council, as 
51.6 	appropriate.
51.7 	(c) "Bond-eligible cost" means:
51.8 	(1) expenditures under this section for acquisition of land or permanent easements, 
51.9 	predesign, design, preliminary and final engineering, environmental analysis, construction, 
51.10 	and reconstruction of publicly owned infrastructure in this state with a useful life of at 
51.11 	least ten years that provides for nonmotorized transportation;
51.12 	(2) preparation of land for which a nonmotorized transportation route is established, 
51.13 	including demolition of structures and remediation of any hazardous conditions on the 
51.14 	land; and
51.15 	(3) the unpaid principal on debt issued by a political subdivision for a nonmotorized 
51.16 	transportation project.
51.17 	(d) "Council" means the Metropolitan Council, as defined under section 473.121, 
51.18 	subdivision 3.
51.19 		Subd. 2.Programs established. (a) Upon availability of funds specifically provided 
51.20 	to an administering authority for purposes of this section, the authority shall establish a 
51.21 	program to support bicycling, pedestrian activities, and other forms of nonmotorized 
51.22 	transportation as provided in this section.
51.23 	(b) Subject to the requirements of this section, the authority may provide grants 
51.24 	or other financial assistance for a project.
51.25 		Subd. 3.Active transportation accounts. (a) An active transportation account 
51.26 	is established in the bond proceeds fund. The account consists of state bond proceeds 
51.27 	appropriated to the commissioner or the council. Money in the account may only be 
51.28 	expended on bond-eligible costs of a project receiving financial assistance under this 
51.29 	section. All uses of funds from the account must be for publicly owned property.
51.30 	(b) A greater Minnesota active transportation account is established in the special 
51.31 	revenue fund. The account consists of funds as provided by law, and any other money 
51.32 	donated, allotted, transferred, or otherwise provided to the account. Money in the account 
51.33 	may only be expended on a project that is primarily located outside of metropolitan 
51.34 	counties, as defined in section 473.121, subdivision 4, and receiving financial assistance 
51.35 	as provided under this section.
52.1 	(c) A metropolitan area active transportation account is established in the special 
52.2 	revenue fund. The account consists of funds as provided by law, and any other money 
52.3 	donated, allotted, transferred, or otherwise provided to the account. Money in the account 
52.4 	may only be expended on a project that is primarily located within metropolitan counties, 
52.5 	as defined in section 473.121, subdivision 4, and receiving financial assistance as provided 
52.6 	under this section.
52.7 		Subd. 4.Program administration. (a) The authority shall establish program 
52.8 	requirements, including:
52.9 	(1) eligibility for assistance, subject to the requirements under paragraph (b);
52.10 	(2) a process for solicitation and application that minimizes applicant burdens; and
52.11 	(3) procedures for award and payment of financial assistance.
52.12 	(b) Eligible recipients of financial assistance under this section are:
52.13 	(1) a political subdivision; and
52.14 	(2) a tax-exempt organization under section 501(c)(3) of the Internal Revenue 
52.15 	Code, as amended.
52.16 	(c) The authority shall make reasonable efforts to publicize each solicitation 
52.17 	for applications among all eligible recipients, and provide assistance in creating and 
52.18 	submitting applications.
52.19 	(d) The authority may expend no more than one percent of available funds in a fiscal 
52.20 	year under this section on program administration.
52.21 		Subd. 5.State general obligation bond funds. Minnesota Constitution, article XI, 
52.22 	section 5, clause (a), requires that state general obligation bonds be issued to finance only 
52.23 	the acquisition or betterment of public land, buildings, and other public improvements of 
52.24 	a capital nature. The legislature has determined that many nonmotorized transportation 
52.25 	infrastructure projects will constitute betterments and capital improvements within the 
52.26 	meaning of the Minnesota Constitution and capital expenditures under generally accepted 
52.27 	accounting principles, and will be financed more efficiently and economically under this 
52.28 	section than by direct appropriations for specific projects.
52.29 		Subd. 6.Use of funds. (a) For a project funded through state bond proceeds under 
52.30 	this section, financial assistance is limited solely to bond-eligible costs.
52.31 	(b) Subject to paragraph (a), the authority shall determine permissible uses of 
52.32 	financial assistance under this section, which must include:
52.33 	(1) construction and maintenance of bicycle, trail, and pedestrian infrastructure, 
52.34 	including but not limited to bicycle facilities and centers, and safe routes to school 
52.35 	infrastructure; and
53.1 	(2) noninfrastructure programming, including activities as specified in section 
53.2 	174.40, subdivision 7a, paragraph (b).
53.3 		Subd. 7.Project evaluation and selection. The authority shall establish a project 
53.4 	evaluation and selection process under this section that is competitive, criteria-based, and 
53.5 	objective. The process must include criteria and prioritization of projects based on:
53.6 	(1) inclusion of the project in a municipal or regional nonmotorized transportation 
53.7 	system plan;
53.8 	(2) location of the project in a jurisdiction in which a complete streets policy, as 
53.9 	provided under section 174.75, is in effect;
53.10 	(3) the extent to which the project supports development of continuous and 
53.11 	convenient safe routes to school;
53.12 	(4) the extent to which the project supports development of routes to and connections 
53.13 	with educational facilities, centers of employment, governmental services, health care 
53.14 	facilities, food sources, transit facilities, and other community destinations;
53.15 	(5) general benefits to public health and safety as a result of the project; and
53.16 	(6) geographic equity in project benefits, as well as benefits in areas or locations 
53.17 	experiencing high rates of pedestrian or bicycle collisions, high rates of health disparities, 
53.18 	and high concentration of poverty.
53.19 		Subd. 8.Grant cancellation. If, five years after execution of a grant agreement, 
53.20 	the authority determines that the grantee has not proceeded in a timely manner with 
53.21 	implementation of the project funded, the commissioner must cancel the grant and the 
53.22 	grantee must repay to the commissioner all grant money paid to the grantee. Section 
53.23 	16A.642 applies to any appropriations made from the bond proceeds fund to the 
53.24 	commissioner under this section that have not been awarded as financial assistance.

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

53.26 	Sec. 11. Minnesota Statutes 2014, section 174.42, is amended by adding a subdivision 
53.27 	to read:
53.28 		Subd. 3.Funding requirement for greater Minnesota. (a) In each federal fiscal 
53.29 	year, the commissioner shall spend out of National Highway Performance Program funds 
53.30 	a total amount in federal transportation funds for an active transportation competitive 
53.31 	grant program in greater Minnesota that totals a minimum of $16,000,000 in excess of 
53.32 	the average annual spending on greater Minnesota transportation alternatives projects in 
53.33 	federal fiscal years between October 2009 and September 2012. This requirement must 
53.34 	not reduce the amount of federal transportation funding for metropolitan projects.
54.1 	(b) The commissioner of transportation shall create and implement the active 
54.2 	transportation competitive grant program. The program must receive funds under this 
54.3 	subdivision and may receive funds from any other source. The commissioner shall 
54.4 	establish criteria for grant awards, in collaboration with experts in bicycle, pedestrian, 
54.5 	trail, and safe routes to school infrastructure. The criteria must clarify statewide priorities, 
54.6 	ensure that grant awards further these statewide priorities, and require grant recipients 
54.7 	to be accountable for their use of program resources. Cities, counties, and townships in 
54.8 	greater Minnesota are eligible to apply for grants for projects related to safe routes to 
54.9 	school infrastructure and noninfrastructure activities, bicycle and pedestrian elements 
54.10 	of a main street program, and planning activities and construction and maintenance of 
54.11 	bicycle, trail, and pedestrian infrastructure.

54.12 	EFFECTIVE DATE. This section is effective October 1, 2015.

54.13 	Sec. 12. Minnesota Statutes 2014, section 174.52, subdivision 4a, is amended to read:
54.14 		Subd. 4a.Rural road safety account; appropriation. (a) A rural road safety 
54.15 	account is established in the local road improvement fund. Money in the account is 
54.16 	annually appropriated to the commissioner of transportation for expenditure as specified 
54.17 	in this subdivision. Money in the account must be used as grants to counties to assist in 
54.18 	paying the costs of capital improvement projects on county state-aid highways that are 
54.19 	intended primarily to reduce traffic crashes, deaths, injuries, and property damage and 
54.20 	improve safety for all road users.
54.21 	(b) The commissioner shall establish procedures for counties to apply for grants 
54.22 	from the rural road safety account and criteria to be used to select projects for funding. 
54.23 	The commissioner shall establish these procedures and criteria in consultation with 
54.24 	representatives appointed by the Association of Minnesota Counties. Eligibility for 
54.25 	project selection must be based on the ability of each proposed project to reduce the 
54.26 	frequency and severity of crashes.
54.27 	(c) Money in the account must be allocated in each fiscal year as follows:
54.28 	(1) one-third of money in the account must be used for projects in the counties of 
54.29 	Anoka, Chisago, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington; and
54.30 	(2) the remainder must be used for projects elsewhere in the state.

54.31 	Sec. 13. Minnesota Statutes 2014, section 174.52, subdivision 5, is amended to read:
54.32 		Subd. 5.Grant procedures and criteria. The commissioner shall establish 
54.33 	procedures for statutory or home rule charter cities, towns, and counties to apply for 
54.34 	grants or loans from the fund and criteria to be used to select projects for funding. 
55.1 	The commissioner shall establish these procedures and criteria in consultation with 
55.2 	representatives appointed by the Association of Minnesota Counties, League of Minnesota 
55.3 	Cities, Minnesota Association of Townships, and the appropriate state agency as needed. 
55.4 	The criteria for determining project priority and the amount of a grant or loan must be 
55.5 	based upon consideration of:
55.6 	(1) the availability of other state, federal, and local funds;
55.7 	(2) the regional significance of the route;
55.8 	(3) effectiveness of the proposed project in eliminating a transportation system 
55.9 	deficiency and improve safety for all road users;
55.10 	(4) the number of persons who will be positively impacted by the project;
55.11 	(5) the project's contribution to other local, regional, or state economic development 
55.12 	or redevelopment efforts including livestock and other agricultural operations permitted 
55.13 	after the effective date of this section; and
55.14 	(6) ability of the local unit of government to adequately provide for the safe 
55.15 	operation and maintenance of the facility upon project completion.

55.16 	Sec. 14. [219.016] RAILROAD COMPANY ASSESSMENT; ACCOUNT; 
55.17 	APPROPRIATION.
55.18 	(a) As provided in this section, the commissioner shall annually assess railroad 
55.19 	companies that are (1) defined as common carriers under section 218.011; (2) classified by 
55.20 	federal law or regulation as Class I Railroads or Class I Rail Carriers; and (3) operating in 
55.21 	this state. The total assessment amount may not exceed $32,500,000 annually.
55.22 	(b) The assessment must be by a division of the annual appropriation to the grade 
55.23 	crossing safety improvement account in equal proportion between carriers based on route 
55.24 	miles operated in Minnesota, assessed in equal amounts for 365 days of the calendar year.
55.25 	(c) The assessments must be deposited in the rail grade crossing safety improvement 
55.26 	account, which is created in the special revenue fund. Money in the account is 
55.27 	appropriated to the commissioner for the development, administration, and construction of 
55.28 	highway-rail grade crossing improvements on rail corridors transporting crude oil, and 
55.29 	other selected routes, including those carrying hazardous materials. Improvements may 
55.30 	include upgrades to existing protection systems, the closing of crossings and necessary 
55.31 	roadwork, and reconstruction of at-grade crossings to full grade separations. Funds in 
55.32 	the account are available until expended.

55.33 	Sec. 15. Minnesota Statutes 2014, section 222.50, subdivision 7, is amended to read:
56.1 		Subd. 7.Expenditures. (a) The commissioner may expend money from the rail 
56.2 	service improvement account for the following purposes:
56.3 	(1) to make transfers as provided under section 222.57 or to pay interest adjustments 
56.4 	on loans guaranteed under the state rail user and rail carrier loan guarantee program;
56.5 	(2) to pay a portion of the costs of capital improvement projects designed to improve 
56.6 	rail service of a rail user or a rail carrier;
56.7 	(3) to pay a portion of the costs of rehabilitation projects designed to improve rail 
56.8 	service of a rail user or a rail carrier;
56.9 	(4) to acquire, maintain, manage, and dispose of railroad right-of-way pursuant to 
56.10 	the state rail bank program;
56.11 	(5) to provide for aerial photography survey of proposed and abandoned railroad 
56.12 	tracks for the purpose of recording and reestablishing by analytical triangulation the 
56.13 	existing alignment of the inplace track;
56.14 	(6) to pay a portion of the costs of acquiring a rail line by a regional railroad 
56.15 	authority established pursuant to chapter 398A;
56.16 	(7) to pay the state matching portion of federal grants for rail-highway grade 
56.17 	crossing improvement projects;
56.18 	(8) for expenditures made before July 1, 2017, to pay the state matching portion 
56.19 	of grants under the federal Transportation Investment Generating Economic Recovery 
56.20 	(TIGER) program of the United States Department of Transportation; and
56.21 	(9) to fund rail planning studies; and
56.22 	(10) to pay a portion of the costs of capital improvement projects designed to 
56.23 	improve capacity or safety at rail yards.
56.24 	(b) All money derived by the commissioner from the disposition of railroad 
56.25 	right-of-way or of any other property acquired pursuant to sections 222.46 to 222.62 shall 
56.26 	be deposited in the rail service improvement account.

56.27 	Sec. 16. Minnesota Statutes 2014, section 297A.94, is amended to read:
56.28 	297A.94 DEPOSIT OF REVENUES.
56.29 	(a) Except as provided in this section, the commissioner shall deposit the revenues, 
56.30 	including interest and penalties, derived from the taxes imposed by this chapter in the state 
56.31 	treasury and credit them to the general fund.
56.32 	(b) The commissioner shall deposit taxes in the Minnesota agricultural and economic 
56.33 	account in the special revenue fund if:
56.34 	(1) the taxes are derived from sales and use of property and services purchased for 
56.35 	the construction and operation of an agricultural resource project; and
57.1 	(2) the purchase was made on or after the date on which a conditional commitment 
57.2 	was made for a loan guaranty for the project under section 41A.04, subdivision 3.
57.3 	The commissioner of management and budget shall certify to the commissioner the date 
57.4 	on which the project received the conditional commitment. The amount deposited in 
57.5 	the loan guaranty account must be reduced by any refunds and by the costs incurred by 
57.6 	the Department of Revenue to administer and enforce the assessment and collection of 
57.7 	the taxes.
57.8 	(c) The commissioner shall deposit the revenues, including interest and penalties, 
57.9 	derived from the taxes imposed on sales and purchases included in section 297A.61, 
57.10 	subdivision 3, paragraph (g), clauses (1) and (4), in the state treasury, and credit them 
57.11 	as follows:
57.12 	(1) first to the general obligation special tax bond debt service account in each fiscal 
57.13 	year the amount required by section 16A.661, subdivision 3, paragraph (b); and
57.14 	(2) after the requirements of clause (1) have been met, the balance to the general fund.
57.15 	(d) The commissioner shall deposit the revenues, including interest and penalties, 
57.16 	collected under section 297A.64, subdivision 5, in the state treasury and credit them to the 
57.17 	general fund. By July 15 of each year the commissioner shall transfer to the highway user 
57.18 	tax distribution fund an amount equal to the excess fees collected under section 297A.64, 
57.19 	subdivision 5, for the previous calendar year.
57.20 	(e) 72.43 percent of the revenues, including interest and penalties, transmitted to 
57.21 	the commissioner under section 297A.65, must be deposited by the commissioner in the 
57.22 	state treasury as follows:
57.23 	(1) 50 percent of the receipts must be deposited in the heritage enhancement account 
57.24 	in the game and fish fund, and may be spent only on activities that improve, enhance, or 
57.25 	protect fish and wildlife resources, including conservation, restoration, and enhancement 
57.26 	of land, water, and other natural resources of the state;
57.27 	(2) 22.5 percent of the receipts must be deposited in the natural resources fund, and 
57.28 	may be spent only for state parks and trails;
57.29 	(3) 22.5 percent of the receipts must be deposited in the natural resources fund, and 
57.30 	may be spent only on metropolitan park and trail grants;
57.31 	(4) three percent of the receipts must be deposited in the natural resources fund, and 
57.32 	may be spent only on local trail grants; and
57.33 	(5) two percent of the receipts must be deposited in the natural resources fund, 
57.34 	and may be spent only for the Minnesota Zoological Garden, the Como Park Zoo and 
57.35 	Conservatory, and the Duluth Zoo.
58.1 	(f) The revenue dedicated under paragraph (e) may not be used as a substitute 
58.2 	for traditional sources of funding for the purposes specified, but the dedicated revenue 
58.3 	shall supplement traditional sources of funding for those purposes. Land acquired with 
58.4 	money deposited in the game and fish fund under paragraph (e) must be open to public 
58.5 	hunting and fishing during the open season, except that in aquatic management areas or 
58.6 	on lands where angling easements have been acquired, fishing may be prohibited during 
58.7 	certain times of the year and hunting may be prohibited. At least 87 percent of the money 
58.8 	deposited in the game and fish fund for improvement, enhancement, or protection of fish 
58.9 	and wildlife resources under paragraph (e) must be allocated for field operations.
58.10 	(g) Beginning July 15, 2016, and by July 15 of each year, the commissioner of 
58.11 	revenue shall transfer an amount equal to the estimated revenues, including interest 
58.12 	and penalties, collected in tax from the sale or purchase of new or used bicycles by a 
58.13 	person who is required to have or voluntarily obtains a permit under section 297A.83, 
58.14 	subdivision 1, from the general fund to be divided equally between the greater Minnesota 
58.15 	active transportation account and the metropolitan area active transportation account 
58.16 	under section 174.38, subdivision 3. Beginning June 30, 2016, and by June 30 of every 
58.17 	fourth year thereafter, the commissioner of revenue must estimate the percentage of total 
58.18 	sales tax revenues collected in the previous calendar year that is attributable to sales 
58.19 	and purchases of bicycles, based on available federal data and Department of Revenue 
58.20 	consumption models. The amount of sales tax revenue to be transferred to the active 
58.21 	transportation account on each July 15 is equal to the most recently calculated percentage 
58.22 	estimate under this paragraph multiplied by the total sales tax revenues collected in the 
58.23 	previous calendar year. For purposes of this section, "bicycle" has the meaning given in 
58.24 	section 169.011, subdivision 4, and does not include bicycle parts.
58.25 	(g) (h) The revenues deposited under paragraphs (a) to (f)in, transferred to, or 
58.26 	credited to a fund other than the general fund by a provision in this chapter do not 
58.27 	include the revenues, including interest and penalties, generated by the sales tax imposed 
58.28 	under section 297A.62, subdivision 1a, which must be deposited as provided under the 
58.29 	Minnesota Constitution, article XI, section 15.

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

58.31 	Sec. 17. [299D.11] MOTORCYCLE PROFILING.
58.32 		Subdivision 1.Purpose. The legislature finds that the reality or public perception of 
58.33 	motorcycle profiling alienates people from police, hinders community policing efforts, and 
58.34 	causes law enforcement to lose credibility and trust among the people law enforcement is 
58.35 	sworn to protect and serve. No stop initiated by a peace officer should be made without 
59.1 	a legitimate reason; the fact that someone rides a motorcycle or wears motorcycle 
59.2 	paraphernalia is not a legitimate reason. Law enforcement policies and training programs 
59.3 	must emphasize the need to respect the balance between the rights of all persons to be free 
59.4 	from unreasonable governmental intrusions and law enforcement's need to enforce the law.
59.5 		Subd. 2.Definition. For purposes of this section, "motorcycle profiling" means 
59.6 	the illegal use of the fact that a person rides a motorcycle or wears motorcycle-related 
59.7 	accouterments as a factor in deciding to stop and question, take enforcement action, 
59.8 	arrest, or search a person or vehicle with or without a legal basis under the United States 
59.9 	Constitution or Minnesota Constitution.
59.10 		Subd. 3.Statewide model policy. By October 1, 2015, the State Patrol, after 
59.11 	consulting with the Department of Public Safety Motorcycle Safety Advisory Task 
59.12 	Force, the Department of Public Safety, the Minnesota Chiefs of Police Association, the 
59.13 	Minnesota Sheriffs Association, the Minnesota Police and Peace Officers Association, 
59.14 	and the Board of Peace Officer Standards and Training, shall develop a statewide model 
59.15 	training policy designed to eliminate motorcycle profiling from law enforcement in the 
59.16 	state. The model antimotorcycle profiling policy must include training in:
59.17 	(1) acts that constitute motorcycle profiling;
59.18 	(2) tactics for avoiding motorcycle profiling; and
59.19 	(3) methods for peace officers and their supervisors to identify and respond to 
59.20 	motorcycle profiling by other peace officers.
59.21 		Subd. 4.Agency policies required. (a) By November 1, 2016, the chief law 
59.22 	enforcement officer of each state and local law enforcement agency must establish and 
59.23 	enforce a written antimotorcycle profiling policy governing the conduct of peace officers 
59.24 	engaged in stops of citizens. The chief law enforcement officer shall ensure that each 
59.25 	peace officer receives a copy of the agency's antimotorcycle profiling policy. The chief 
59.26 	law enforcement officer also must ensure that each peace officer is aware of the policy's 
59.27 	purpose and prohibited conduct.
59.28 	(b) The policy must, at a minimum, comply with the requirements of the model 
59.29 	policy adopted by the State Patrol under subdivision 3 and require peace officers to give 
59.30 	their name and badge number to each motorcycle operator stopped for any reason.
59.31 	(c) Each state and local law enforcement agency must certify to the State Patrol that 
59.32 	the agency has adopted a written policy in compliance with the State Patrol's model policy.
59.33 		Subd. 5.Compliance reviews. The State Patrol has authority to inspect state and 
59.34 	local agency policies to ensure compliance with subdivision 4. The State Patrol may 
59.35 	conduct an inspection based upon a complaint it receives about a particular agency or 
59.36 	through a random selection process.

60.1 	Sec. 18. Minnesota Statutes 2014, section 357.021, subdivision 7, is amended to read:
60.2 		Subd. 7.Disbursement of surcharges by commissioner of management and 
60.3 	budget. (a) Except as provided in paragraphs (b), (c), and (d), and (e), the commissioner 
60.4 	of management and budget shall disburse surcharges received under subdivision 6 and 
60.5 	section 97A.065, subdivision 2, as follows:
60.6 	(1) one percent shall must be credited to the peace officer training account in the 
60.7 	game and fish fund to provide peace officer training for employees of the Department of 
60.8 	Natural Resources who are licensed under sections 626.84 to 626.863, and who possess 
60.9 	peace officer authority for the purpose of enforcing game and fish laws;
60.10 	(2) 39 percent shall must be credited to the peace officers training account in the 
60.11 	special revenue fund; and
60.12 	(3) 60 percent shall must be credited to the general fund.
60.13 	(b) The commissioner of management and budget shall credit $3 of each surcharge 
60.14 	received under subdivision 6 and section 97A.065, subdivision 2, except for the $12 
60.15 	parking surcharge, to the general fund.
60.16 	(c) In addition to any amounts credited under paragraph (a), the commissioner of 
60.17 	management and budget shall credit $47 of each surcharge received under subdivision 6 
60.18 	and section 97A.065, subdivision 2, and the $12 parking surcharge, to the general fund.
60.19 	(d) If the Ramsey County Board of Commissioners authorizes imposition of the 
60.20 	additional $1 surcharge provided for in subdivision 6, paragraph (a), the court administrator 
60.21 	in the Second Judicial District shall transmit the surcharge to the commissioner of 
60.22 	management and budget. The $1 special surcharge is deposited in a Ramsey County 
60.23 	surcharge account in the special revenue fund and amounts in the account are appropriated 
60.24 	to the trial courts for the administration of the petty misdemeanor diversion program 
60.25 	operated by the Second Judicial District Ramsey County Violations Bureau.
60.26 	(e) The commissioner of management and budget shall credit the $12 parking 
60.27 	surcharge to the highway user tax distribution fund.

60.28 	EFFECTIVE DATE. This section is effective July 1, 2015, and applies to 
60.29 	surcharges on parking violations committed on and after that date.

60.30 	Sec. 19. Minnesota Statutes 2014, section 360.305, subdivision 4, is amended to read:
60.31 		Subd. 4.Costs allocated; local contribution; hangar construction account. (a) 
60.32 	Except as otherwise provided in this subdivision Annually by June 1, the commissioner 
60.33 	of transportation shall require as a condition of assistance by the state that the establish 
60.34 	local contribution rates which will apply to a political subdivision, municipality, or public 
60.35 	corporation make a substantial contribution to the cost of the construction, improvement, 
61.1 	maintenance, or operation of the airport, in connection with which the assistance of the 
61.2 	state is sought. These costs are referred to as project costs when applying for state or 
61.3 	federal funding assistance to construct, improve, maintain, or operate an airport, or to 
61.4 	acquire land for airport facilities or clear zones. If the commissioner does not establish 
61.5 	local contribution rates by June 1, the previous rates apply.
61.6 	(b) For any airport, whether key, intermediate, or landing strip, where only state and 
61.7 	local funds are to be used, the contribution shall be not less than one-fifth of the sum of:
61.8 	(1) the project costs;
61.9 	(2) acquisition costs of the land and clear zones, which are referred to as acquisition 
61.10 	costs. The commissioner may pay all costs beyond the local contribution. Local 
61.11 	contribution rates shall not be less than five percent of the total cost of the activity or 
61.12 	acquisition, except that the commissioner may require less than five percent for research 
61.13 	projects, radio or navigational aids, activities, or acquisitions for which federal funds are 
61.14 	available to cover more than 90 percent of the total cost, or as otherwise necessary to 
61.15 	respond to an emergency.
61.16 	(c) For any airport where federal, state, and local funds are to be used, the 
61.17 	contribution shall not be less than five percent of the sum of the project costs and 
61.18 	acquisition costs. The commissioner's establishment of local contribution rates is not 
61.19 	subject to the rulemaking requirements of chapter 14.
61.20 	(d) The commissioner may pay the total cost of radio and navigational aids.
61.21 	(e) Notwithstanding paragraph (b) or (c), the commissioner may pay all of the 
61.22 	project costs of a new landing strip, but not an intermediate airport or key airport, or may 
61.23 	pay an amount equal to the federal funds granted and used for a new landing strip plus 
61.24 	all of the remaining project costs; but the total amount paid by the commissioner for the 
61.25 	project costs of a new landing strip, unless specifically authorized by an act appropriating 
61.26 	funds for the new landing strip, shall not exceed $200,000.
61.27 	(f) Notwithstanding paragraph (b) or (c), the commissioner may pay all the project 
61.28 	costs for research and development projects, including, but not limited to noise abatement; 
61.29 	provided that in no event shall the sums expended under this paragraph exceed five 
61.30 	percent of the amount appropriated for construction grants.
61.31 	(g) (d) To receive aid under this section for project costs or for acquisition costs, the 
61.32 	municipality must enter into an agreement with the commissioner giving assurance that 
61.33 	the airport will be operated and maintained in a safe, serviceable manner for aeronautical 
61.34 	purposes only for the use and benefit of the public:
61.35 	(1) for 20 years after the date thatthe municipality receives any state funds for 
61.36 	project construction or improvement costs are received by the municipality; and
62.1 	(2) for 99 years after the date thatthe municipality receives any state funds for land 
62.2 	acquisition costs are received by the municipality. If any land acquired with state funds 
62.3 	ceases to be used for aviation purposes, the municipality shall repay the state airports fund 
62.4 	the same percentage of the appraised value of the property as that percentage of the costs 
62.5 	of acquisition and participation provided by the state to acquire the land.
62.6 	The agreement may contain other conditions as the commissioner deems reasonable.
62.7 	(h) (e) The commissioner shall establish a hangar construction revolving account, 
62.8 	which shall be used for the purpose of financing the construction of hangar buildings to 
62.9 	be constructed by municipalities owning airports. All municipalities owning airports are 
62.10 	authorized to enter into contracts for the construction of hangars, and contracts with 
62.11 	the commissioner for the financing of hangar construction for an amount and period of 
62.12 	time as may be determined by the commissioner and municipality. All receipts from the 
62.13 	financing contracts shall be deposited in the hangar construction revolving account and 
62.14 	are reappropriated for the purpose of financing construction of hangar buildings. The 
62.15 	commissioner may pay from the hangar construction revolving account 80 percent of the 
62.16 	cost of financing construction of hangar buildings. For purposes of this paragraph, the 
62.17 	construction of hangars shall include their design. The commissioner shall transfer up to 
62.18 	$4,400,000 from the state airports fund to the hangar construction revolving account.
62.19 	(i) (f) The commissioner may pay a portion of the purchase price of any contribute 
62.20 	to costs incurred by any municipality for airport maintenance and operations, safety 
62.21 	equipment, and of the actual airport snow removal costs incurred by any municipality. 
62.22 	The portion to be paid by the state shall not exceed two-thirds of the cost of the purchase 
62.23 	price or snow removal. To receive aid a municipality must enter into an agreement of the 
62.24 	type referred to in paragraph (g).
62.25 	(j) (g) This subdivision applies only to project costs or acquisition costs of 
62.26 	municipally owned airports incurred after June 1, 1971.

62.27 	Sec. 20. [473.1296] MADE IN AMERICA.
62.28 	In all construction and maintenance projects, the council shall, to the greatest extent 
62.29 	feasible, utilize products, materials, and equipment that are made in America and shall 
62.30 	include this requirement in its contract specifications.

62.31 	Sec. 21. Minnesota Statutes 2014, section 473.915, is amended to read:
62.32 	473.915 PROCUREMENTS.
62.33 		Subdivision 1.Review by Legislative Advisory Commission. All proposed 
62.34 	Metropolitan Council procurements over $125,000,000 must be reviewed by the 
63.1 	members of the Legislative Advisory Commission under section 3.30 and the ranking 
63.2 	minority members of the house of representatives and senate committees or divisions 
63.3 	responsible for overseeing the items subject to the proposed procurement. The chair 
63.4 	of the Metropolitan Council shall give notice to the Legislative Advisory Commission 
63.5 	secretary when a procurement over $125,000,000 is being considered. The commission 
63.6 	shall take testimony on the procurements.
63.7 		Subd. 2.Review by Transportation Accessibility Advisory Committee.
 63.8 	The council shall consult with the Transportation Accessibility Advisory Committee 
63.9 	concerning all proposed Metropolitan Council procurements of transit vehicles and shall 
63.10 	consider the committee's input before ordering vehicles.

63.11 	EFFECTIVE DATE. This section is effective the day following final enactment 
63.12 	and applies in the counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and 
63.13 	Washington.

63.14 	Sec. 22. COST SHARE POLICY.
 63.15 	The commissioner of transportation, in consultation with representatives of local 
63.16 	units of government, shall create and adopt a policy concerning cost participation 
63.17 	for cooperative construction projects and maintenance responsibilities between the 
63.18 	Department of Transportation and local units of government.  The policy must minimize 
63.19 	the share of cooperative project costs to be funded by the local units of government, 
63.20 	while complying in all respects with the state constitutional requirements concerning 
63.21 	allowable uses of the trunk highway fund.  The policy must be completed and adopted by 
63.22 	the commissioner no later than September 1, 2015.

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

63.24 	Sec. 23. PUBLIC-PRIVATE PARTNERSHIP PILOT PROGRAM.
 63.25 		Subdivision 1.Public-private partnership initiatives. (a) The commissioner 
63.26 	of transportation and Metropolitan Council are authorized to consider and utilize 
63.27 	public-private partnership procurement methods for up to three pilot projects as provided 
63.28 	in this section. Utilization of public-private partnerships is a recognition of the importance 
63.29 	to the state of an efficient and safe transportation system, and the necessity of developing 
63.30 	alternative funding sources to supplement traditional sources of transportation revenues. 
63.31 	A public-private partnership initiative must take advantage of private sector efficiencies in 
63.32 	design and construction, along with expertise in finance and development, and provide a 
64.1 	better long-term value for the state than could be obtained through traditional procurement 
64.2 	methods.
64.3 	(b) Notwithstanding Minnesota Statutes, section 160.98, or any other law to the 
64.4 	contrary, the commissioner or council may consider for use in the pilot program any 
64.5 	existing public-private partnership mechanism or any proposed mechanism that proves the 
64.6 	best available option for the state. Mechanisms the commissioner or council may consider 
64.7 	include, but are not limited to, toll facilities, BOT facilities, BTO facilities, user fees, 
64.8 	construction payments, joint development agreements, negotiated exactions, air rights 
64.9 	development, street improvement districts, or tax increment financing districts for transit. 
64.10 	For the purposes this section, toll facilities, BOT facilities, and BTO facilities have the 
64.11 	meanings given under Minnesota Statutes, section 160.84.
64.12 	(c) As part of the pilot program, the commissioner and council are directed to form 
64.13 	an independent advisory and oversight office, the Joint Program Office for Economic 
64.14 	Development and Alternative Finance. The office shall consist of the commissioner of 
64.15 	management and budget, the commissioner of employment and economic development, 
64.16 	the commissioner of administration, the commissioner of transportation, the Metropolitan 
64.17 	Council, and one representative each from the American Council of Engineering 
64.18 	Companies - Minnesota chapter, the Central Minnesota Transportation Alliance, the 
64.19 	Counties Transit Improvement Board, and the Minnesota County Engineers Association. 
64.20 	In addition, the commissioner and Metropolitan Council shall invite the Federal Highway 
64.21 	Administration and the Federal Transit Administration to participate in the office's 
64.22 	activities. The office's duties shall include, but are not limited to, reviewing and approving 
64.23 	projects proposed under this section, reviewing any contractual or financial agreements 
64.24 	to ensure program requirements are met, and ensuring that any proposed or executed 
64.25 	agreement serves the public interest.
64.26 		Subd. 2.Pilot program restrictions and project selection. (a) The commissioner 
64.27 	or council may receive or solicit and evaluate proposals to build, operate, and finance 
64.28 	projects that are not inconsistent with the commissioner's most recent statewide 
64.29 	transportation plan or the council's most recent transportation policy plan. If the 
64.30 	department or council receives an unsolicited proposal, the department or council shall 
64.31 	publish a notice in the State Register at least once a week for two weeks stating that the 
64.32 	department or council has received the proposal and will accept, for 120 days after the 
64.33 	initial date of publication, other proposals for the same project purpose. The private 
64.34 	proposer must be selected on a competitive basis.
65.1 	(b) When entering into a public-private partnership, the commissioner or 
65.2 	Metropolitan Council may not enter into any noncompete agreement that inhibits the 
65.3 	state's ability to address ongoing or future infrastructure needs.
65.4 	(c) If the commissioner or council enters into a public-private partnership agreement 
65.5 	that includes a temporary transfer of ownership or control of a road, bridge, or other 
65.6 	infrastructure investment to the private entity, the agreement must include a provision 
65.7 	requiring the return of the road, bridge, or other infrastructure investment to the state 
65.8 	after a specified period of time.
65.9 	(d) The commissioner and council may only consider new projects for a 
65.10 	public-private partnership. The commissioner and council are prohibited from considering 
65.11 	projects involving existing infrastructure for a public-private partnership, unless the 
65.12 	proposed project adds capacity to the existing infrastructure.
65.13 		Subd. 3.Evaluation and selection of private entity and project. (a) The 
65.14 	commissioner and council shall contract with one or more consultants to assist in proposal 
65.15 	evaluation. The consultant must possess expertise and experience in public-private 
65.16 	partnership project evaluation methodology, such as value for money, costs of 
65.17 	public-private partnership compared with costs of public project delivery, and cost-benefit 
65.18 	analysis.
65.19 	(b) When soliciting, evaluating, and selecting a private entity with which to enter 
65.20 	into a public-private partnership and before selecting a project, the commissioner or 
65.21 	council must consider:
65.22 	(1) the ability of the proposed project to improve safety, reduce congestion, increase 
65.23 	capacity, and promote economic growth;
65.24 	(2) the proposed cost of and financial plan for the project;
65.25 	(3) the general reputation, qualifications, industry experience, and financial capacity 
65.26 	of the private entity;
65.27 	(4) the project's proposed design, operation, and feasibility;
65.28 	(5) length and extent of transportation and transit service disruption;
65.29 	(6) comments from local citizens and affected jurisdictions;
65.30 	(7) benefits to the public;
65.31 	(8) the safety record of the private entity; and
65.32 	(9) any other criteria the commissioner or council deems appropriate.
65.33 	(c) The independent advisory and oversight office established under subdivision 
65.34 	1, paragraph (c), shall review proposals evaluated by the commissioner or council to 
65.35 	ensure the requirements of this section are being met. The independent advisory and 
65.36 	oversight office shall first determine whether the project, as proposed, serves the public 
66.1 	interest. In making this determination, the office must identify and consider advantages 
66.2 	and disadvantages for various stakeholders, including taxpayers, workers, transportation 
66.3 	and transit providers and operators, transportation and transit users, commercial vehicle 
66.4 	operators, and the general public, including the impact on the state's economy. If the 
66.5 	proposed project serves the public interest, the office must evaluate the proposals 
66.6 	according to the criteria specified in this section.
66.7 		Subd. 4.Public-private agreement. (a) A public-private agreement between the 
66.8 	commissioner or the council and a private entity shall, at a minimum, specify:
66.9 	(1) the planning, acquisition, financing, development, design, construction, 
66.10 	reconstruction, replacement, improvement, maintenance, management, repair, leasing, or 
66.11 	operation of the project;
66.12 	(2) the term of the public-private agreement;
66.13 	(3) the type of property interest, if any, that the private entity will have in the project;
66.14 	(4) a description of the actions the commissioner or council may take to ensure 
66.15 	proper maintenance of the project; 
66.16 	(5) whether user fees will be collected on the project and the basis by which the user 
66.17 	fees shall be determined and modified along with identification of the public agency that 
66.18 	will determine and modify fees;
66.19 	(6) compliance with applicable federal, state, and local laws;
66.20 	(7) grounds for termination of the public-private agreement by the commissioner 
66.21 	or council;
66.22 	(8) adequate safeguards for the traveling public and residents of the state in event of 
66.23 	default on the contract;
66.24 	(9) financial protection for the state in the event of default; and 
66.25 	(10) procedures for amendment of the agreement.
66.26 	(b) A public-private agreement between the commissioner or council and a private 
66.27 	entity may provide for:
66.28 	(1) review and approval by the commissioner or council of the private entity's plans 
66.29 	for the development and operation of the project;
66.30 	(2) inspection by the commissioner or council of construction and improvements 
66.31 	to the project;
66.32 	(3) maintenance by the private entity of a liability insurance policy;
66.33 	(4) filing of appropriate financial statements by the private entity on a periodic basis;
66.34 	(5) filing of traffic reports by the private entity on a periodic basis;
66.35 	(6) financing obligations of the commissioner or council and the private entity;
67.1 	(7) apportionment of expenses between the commissioner or council and the private 
67.2 	entity;
67.3 	(8) the rights and remedies available in the event of a default or delay;
67.4 	(9) the rights and duties of the private entity, the commissioner or council, and other 
67.5 	state or local governmental entities with respect to the use of the project;
67.6 	(10) the terms and conditions of indemnification of the private entity by the 
67.7 	commissioner or council;
67.8 	(11) assignment, subcontracting, or other delegations of responsibilities of (i) 
67.9 	the private entity, or (ii) the commissioner or council under agreement to third parties, 
67.10 	including other private entities or state agencies;
67.11 	(12) if applicable, sale or lease to the private entity of private property related to 
67.12 	the project;
67.13 	(13) traffic enforcement and other policing issues; and
67.14 	(14) any other terms and conditions the commissioner or council deems appropriate.
67.15 	(c) The independent advisory and oversight office established under subdivision 
67.16 	1, paragraph (c), shall review any proposed contractual agreement prior to execution 
67.17 	in order to ensure that the contract serves the public interest and the requirements of 
67.18 	this section are met.
67.19 		Subd. 5.Funding from federal government. (a) The commissioner or council may 
67.20 	accept from the United States or any of its agencies funds that are available to the state 
67.21 	for carrying out the pilot program, whether the funds are available by grant, loan, or 
67.22 	other financial assistance.
67.23 	(b) The commissioner or council may enter into agreements or other arrangements 
67.24 	with the United States or any of its agencies as necessary for carrying out the pilot program.
67.25 	(c) The commissioner or council shall seek to maximize project funding from 
67.26 	nonstate sources and may combine federal, state, local, and private funds to finance a 
67.27 	public-private partnership pilot project.
67.28 		Subd. 6.Reporting. By August 1, 2016, and annually by August 1 thereafter, the 
67.29 	commissioner and council shall submit to the chairs and ranking minority members of the 
67.30 	house of representatives and senate committees having jurisdiction over transportation 
67.31 	policy and finance a list of all agreements executed under the pilot program authority. The 
67.32 	list must identify each agreement, the contracting entities, contract amount and duration, 
67.33 	any repayment requirements, and provide an update on the project's progress. The list 
67.34 	may be submitted electronically and is subject to Minnesota Statutes, section 3.195, 
67.35 	subdivision 1.

68.1 	EFFECTIVE DATE. This section is effective the day after an appropriation is 
68.2 	effective to pay administrative expenses creating and operating the Joint Program Office 
68.3 	for Economic Development and Alternative Finance, hiring a consultant, and preparing 
68.4 	required reports.

68.5 	Sec. 24. DEPARTMENT OF TRANSPORTATION LAND ACQUISITION.
 68.6 	As part of the construction of a bridge and bridge approaches along Trunk Highway 
68.7 	23 in the city of Duluth, the commissioner of transportation shall acquire by purchase or 
68.8 	gift, in fee or a lesser estate as the commissioner deems necessary, the lands and properties 
68.9 	located in St. Louis County and consisting of three parcels identified and described as 
68.10 	St. Louis County Property Tax Parcel Numbers 010-3510-08110, 101-3510-08120, and 
68.11 	010-3510-08130.

68.12 	Sec. 25. TRANSPORTATION PROJECT SELECTION PROCESS.
 68.13 		Subdivision 1.Adoption of process and public input. The commissioner of 
68.14 	transportation shall, after consultation with metropolitan planning organizations, regional 
68.15 	development commissions, area transportation partnerships, local governments, and the 
68.16 	Metropolitan Council, draft a proposed transportation project data-driven evaluation 
68.17 	process to provide an objective and consistent analysis to assist in developing the 
68.18 	statewide transportation plan and prioritization of highway construction, reconstruction, 
68.19 	and improvement projects in the state transportation improvement program. No later than 
68.20 	September 1, 2015, the proposed process must be reported to the chairs and ranking 
68.21 	minority members of the senate and house of representatives committees on transportation 
68.22 	policy and finance and publicized, along with a schedule for public hearings and additional 
68.23 	opportunities for public input electronically and at locations throughout the state. No later 
68.24 	than January 10, 2016, after public comment has been heard and incorporated into the 
68.25 	proposed evaluation process, the commissioner shall adopt a final process for use in 
68.26 	highway project investment decisions on and after March 1, 2016.
68.27 		Subd. 2.Factors in analysis. The process must be based on objective, consistent, 
68.28 	and quantifiable analysis. Factors in the analysis must include return on investment, 
68.29 	benefit-cost, local rankings, safety, congestion mitigation, economic development, 
68.30 	accessibility, environmental quality, regional and metropolitan-rural balance, and land 
68.31 	use. The process may assign different weights to factors in evaluating projects on the 
68.32 	trunk highway system, the county state-aid highway system, and the municipal state-aid 
68.33 	street system.
68.34 		Subd. 3.Exemptions. A proposed project is exempt from the process if it is:
69.1 	(1) funded by a grant from:
69.2 	(i) the corridors of commerce program under Minnesota Statutes, section 161.088;
69.3 	(ii) the transportation economic development program under Minnesota Statutes, 
69.4 	section 174.12; and
69.5 	(iii) the joint powers board under Minnesota Statutes, section 297A.992, subdivision 
69.6 	6; or 
69.7 	(2) preservation, maintenance, capital preventive treatment or safety project that 
69.8 	does not increase capacity of the infrastructure, or if subjecting it to the evaluation process 
69.9 	would result in a loss of federal funds.
69.10 		Subd. 4.Information on department's Web site. For each proposed project 
69.11 	evaluated under this process, the applicable scoring process, the score for each factor, 
69.12 	and the overall score are public information and must be publicized on the department's 
69.13 	Web site.

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

69.15 	Sec. 26. ACTIVE TRANSPORTATION PROGRAM DEVELOPMENT.
 69.16 	(a) By October 1, 2015, the Advisory Committee on Nonmotorized Transportation 
69.17 	under Minnesota Statutes, section 174.37, shall develop and submit recommendations to 
69.18 	each administering authority under Minnesota Statutes, section 174.38, for developing 
69.19 	project evaluation and selection processes under Minnesota Statutes, section 174.38, 
69.20 	subdivision 7. The advisory committee may consult with representatives from the 
69.21 	Bicycle Alliance of Minnesota, Minnesota Chamber of Commerce, Metropolitan 
69.22 	Council Transportation Accessibility Advisory Committee, Minnesota Department of 
69.23 	Transportation district area transportation partnerships, Minnesota State Council on 
69.24 	Disability, organizations representing elderly populations, and public health organizations 
69.25 	with experience in active transportation.
69.26 	(b) In its next annual report under Minnesota Statutes, section 174.37, subdivision 
69.27 	4, the advisory committee shall include a summary of the recommendations under this 
69.28 	section and submit a copy to the chairs and ranking minority members of the legislative 
69.29 	committees with jurisdiction over transportation policy and finance. The report is subject 
69.30 	to Minnesota Statutes, section 3.195.

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

69.32 	Sec. 27. REPORT ON DEDICATED FUND EXPENDITURES. 
 70.1 	By January 15, 2016, the commissioner of management and budget shall submit 
70.2 	a report to the chairs and ranking minority members of the legislative committees with 
70.3 	jurisdiction over transportation finance. The report must list detailed expenditures and 
70.4 	transfers from the trunk highway fund and highway user tax distribution fund for fiscal 
70.5 	years 2010 through 2015, and shall include information on the purpose of each expenditure.

70.6 	Sec. 28. ROAD DESIGN STANDARDS.
 70.7 	By August 15, 2016, the commissioner of transportation shall, in collaboration 
70.8 	with city and county engineers, establish and adopt design standards and guidelines to 
70.9 	be applied consistently to trunk highways, county state-aid highways, and municipal 
70.10 	state-aid streets with similar characteristics. The standards and guidelines must align the 
70.11 	state-aid standards with the Department of Transportation trunk highway standards and 
70.12 	technical memoranda as appropriate. The commissioner shall report the adopted standards 
70.13 	and guidelines to the chairs and ranking minority members of the senate and house of 
70.14 	representatives committees with jurisdiction over transportation policy by August 15, 
70.15 	2016, and present an interim report by March 15, 2016.

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