1.1                          A bill for an act 
  1.2             relating to taxation; modifying qualifications and 
  1.3             process for granting permission for pooling among 
  1.4             districts; amending Minnesota Statutes 2000, section 
  1.5             469.1763, subdivision 6. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 2000, section 469.1763, 
  1.8   subdivision 6, is amended to read: 
  1.9      Subd. 6.  [POOLING PERMITTED FOR DEFICITS.] (a) This 
  1.10  subdivision applies only to districts for which the request for 
  1.11  certification was made before June 2, 1997. 
  1.12     (b) The municipality for the district may transfer 
  1.13  available increments from another tax increment financing 
  1.14  district located in the municipality, if the transfer is 
  1.15  necessary to eliminate a deficit in the district to which the 
  1.16  increments are transferred.  A deficit in the district for 
  1.17  purposes of this subdivision means the lesser of the following 
  1.18  two amounts: 
  1.19     (1)(i) the amount due during the calendar year to pay 
  1.20  preexisting obligations of the district; minus the sum of: 
  1.21     (ii) (2) the total increments to be collected from 
  1.22  properties located within the district that are available for 
  1.23  the calendar year; plus 
  1.24     (iii) (3) total increments from properties located in other 
  1.25  districts in the municipality that are available to be used to 
  2.1   meet the district's obligations under this section, excluding 
  2.2   this subdivision, or other provisions of law (but excluding a 
  2.3   special tax under section 469.1791 and the grant program under 
  2.4   Laws 1997, chapter 231, article 1, section 19); or 
  2.5      (2) the reduction in increments collected from properties 
  2.6   located in the district for the calendar year as a result of the 
  2.7   changes in class rates in Laws 1997, chapter 231, article 1; 
  2.8   Laws 1998, chapter 389, article 2; and Laws 1999, chapter 243. 
  2.9      (c) A preexisting obligation means bonds issued and sold 
  2.10  before June 2, 1997, the proceeds of which were either spent on 
  2.11  or before December 31, 2000, or deposited into a reasonably 
  2.12  required reserve or replacement fund, and bonds issued to refund 
  2.13  such bonds or to reimburse expenditures made in conjunction with 
  2.14  a signed contractual agreement entered into before June 2, 1997, 
  2.15  to the extent that the bonds are secured by a pledge of 
  2.16  increments from the tax increment financing district.  For 
  2.17  purposes of this subdivision, bonds exclude an obligation to 
  2.18  reimburse or pay a developer or owner of property located in the 
  2.19  district for amounts incurred or paid by the developer or owner. 
  2.20     (d) The municipality may require a development authority, 
  2.21  other than a seaway port authority, to transfer available 
  2.22  increments for any of its tax increment financing districts in 
  2.23  the municipality to make up an insufficiency in another district 
  2.24  in the municipality, regardless of whether the district was 
  2.25  established by the development authority or another development 
  2.26  authority.  This authority applies notwithstanding any law to 
  2.27  the contrary, but applies only to a development authority that: 
  2.28     (1) was established by the municipality; or 
  2.29     (2) the governing body of which is appointed, in whole or 
  2.30  part, by the municipality or an officer of the municipality or 
  2.31  which consists, in whole or part, of members of the governing 
  2.32  body of the municipality. 
  2.33     (e) The authority under this subdivision to spend tax 
  2.34  increments outside of the area of the district from which the 
  2.35  tax increments were collected: 
  2.36     (1) may only be exercised after obtaining approval of the 
  3.1   use of the increments, in writing, by the commissioner of 
  3.2   revenue; 
  3.3      (2) is an exception to the restrictions under section 
  3.4   469.176, subdivision 4i, and the other provisions of this 
  3.5   section, and the percentage restrictions under subdivision 2 
  3.6   must be calculated after deducting increments spent under this 
  3.7   subdivision from the total increments for the district; and 
  3.8      (3) (2) applies notwithstanding the provisions of the Tax 
  3.9   Increment Financing Act in effect for districts for which the 
  3.10  request for certification was made before June 30, 1982, or any 
  3.11  other law to the contrary. 
  3.12     <b>[EFFECTIVE DATE.]</b> This section is effective for increments 
  3.13  collected in 2002 and thereafter.