1.1                          A bill for an act 
  1.2             relating to taxation; requiring disclosure of and a 
  1.3             vote by local governing bodies on increases in 
  1.4             property taxes due to reduced market value; amending 
  1.5             Minnesota Statutes 1998, section 275.065, subdivision 
  1.6             6. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 1998, section 275.065, 
  1.9   subdivision 6, is amended to read: 
  1.10     Subd. 6.  [PUBLIC HEARING; ADOPTION OF BUDGET AND LEVY.] 
  1.11  (a) For purposes of this section, the following terms shall have 
  1.12  the meanings given: 
  1.13     (1) "Initial hearing" means the first and primary hearing 
  1.14  held to discuss the taxing authority's proposed budget and 
  1.15  proposed property tax levy for taxes payable in the following 
  1.16  year, or, for school districts, the current budget and the 
  1.17  proposed property tax levy for taxes payable in the following 
  1.18  year. 
  1.19     (2) "Continuation hearing" means a hearing held to complete 
  1.20  the initial hearing, if the initial hearing is not completed on 
  1.21  its scheduled date. 
  1.22     (3) "Subsequent hearing" means the hearing held to adopt 
  1.23  the taxing authority's final property tax levy, and, in the case 
  1.24  of taxing authorities other than school districts, the final 
  1.25  budget, for taxes payable in the following year. 
  1.26     (b) Between November 29 and December 20, the governing 
  2.1   bodies of a city that has a population over 500, county, 
  2.2   metropolitan special taxing districts as defined in subdivision 
  2.3   3, paragraph (i), and regional library districts shall each hold 
  2.4   an initial public hearing to discuss and seek public comment on 
  2.5   its final budget and property tax levy for taxes payable in the 
  2.6   following year, and the governing body of the school district 
  2.7   shall hold an initial public hearing to review its current 
  2.8   budget and proposed property tax levy for taxes payable in the 
  2.9   following year.  The metropolitan special taxing districts shall 
  2.10  be required to hold only a single joint initial public hearing, 
  2.11  the location of which will be determined by the affected 
  2.12  metropolitan agencies. 
  2.13     (c) The initial hearing must be held after 5:00 p.m. if 
  2.14  scheduled on a day other than Saturday.  No initial hearing may 
  2.15  be held on a Sunday.  
  2.16     (d) At the initial hearing under this subdivision, the 
  2.17  percentage increase in property taxes proposed by the taxing 
  2.18  authority, if any, and the specific purposes for which property 
  2.19  tax revenues are being increased must be discussed.  During the 
  2.20  discussion, the governing body shall hear comments regarding a 
  2.21  proposed increase and explain the reasons for the proposed 
  2.22  increase.  The public shall be allowed to speak and to ask 
  2.23  questions.  At the public hearing, the school district must also 
  2.24  provide and discuss information on the distribution of its 
  2.25  revenues by revenue source, and the distribution of its spending 
  2.26  by program area.  At a hearing conducted by the governing body 
  2.27  of any taxing authority in which the total market value of 
  2.28  property in any class of property has declined since the 
  2.29  previous levy year, the estimated aggregate amount and 
  2.30  percentage by which the property tax levy will be shifted onto 
  2.31  each other class of property within that taxing authority must 
  2.32  be disclosed and explained. 
  2.33     (e) If the initial hearing is not completed on its 
  2.34  scheduled date, the taxing authority must announce, prior to 
  2.35  adjournment of the hearing, the date, time, and place for the 
  2.36  continuation of the hearing.  The continuation hearing must be 
  3.1   held at least five business days but no more than 14 business 
  3.2   days after the initial hearing.  A continuation hearing may not 
  3.3   be held later than December 20 except as provided in paragraphs 
  3.4   (f) and (g).  A continuation hearing must be held after 5:00 
  3.5   p.m. if scheduled on a day other than Saturday.  No continuation 
  3.6   hearing may be held on a Sunday. 
  3.7      (f) The governing body of a county shall hold its initial 
  3.8   hearing on the first Thursday in December each year, and may 
  3.9   hold additional initial hearings on other dates before December 
  3.10  20 if necessary for the convenience of county residents.  If the 
  3.11  county needs a continuation of its hearing, the continuation 
  3.12  hearing shall be held on the third Tuesday in December.  If the 
  3.13  third Tuesday in December falls on December 21, the county's 
  3.14  continuation hearing shall be held on Monday, December 20.  
  3.15     (g) The metropolitan special taxing districts shall hold a 
  3.16  joint initial public hearing on the first Wednesday of 
  3.17  December.  A continuation hearing, if necessary, shall be held 
  3.18  on the second Wednesday of December even if that second 
  3.19  Wednesday is after December 10. 
  3.20     (h) The county auditor shall provide for the coordination 
  3.21  of initial and continuation hearing dates for all school 
  3.22  districts and cities within the county to prevent conflicts 
  3.23  under clauses (i) and (j). 
  3.24     (i) By August 10, each school board and the board of the 
  3.25  regional library district shall certify to the county auditors 
  3.26  of the counties in which the school district or regional library 
  3.27  district is located the dates on which it elects to hold its 
  3.28  initial hearing and any continuation hearing.  If a school board 
  3.29  or regional library district does not certify these dates by 
  3.30  August 10, the auditor will assign the initial and continuation 
  3.31  hearing dates.  The dates elected or assigned must not conflict 
  3.32  with the initial and continuation hearing dates of the county or 
  3.33  the metropolitan special taxing districts.  
  3.34     (j) By August 20, the county auditor shall notify the 
  3.35  clerks of the cities within the county of the dates on which 
  3.36  school districts and regional library districts have elected to 
  4.1   hold their initial and continuation hearings.  At the time a 
  4.2   city certifies its proposed levy under subdivision 1 it shall 
  4.3   certify the dates on which it elects to hold its initial hearing 
  4.4   and any continuation hearing.  Until September 15, the first and 
  4.5   second Mondays of December are reserved for the use of the 
  4.6   cities.  If a city does not certify its hearing dates by 
  4.7   September 15, the auditor shall assign the initial and 
  4.8   continuation hearing dates.  The dates elected or assigned for 
  4.9   the initial hearing must not conflict with the initial hearing 
  4.10  dates of the county, metropolitan special taxing districts, 
  4.11  regional library districts, or school districts within which the 
  4.12  city is located.  To the extent possible, the dates of the 
  4.13  city's continuation hearing should not conflict with the 
  4.14  continuation hearing dates of the county, metropolitan special 
  4.15  taxing districts, regional library districts, or school 
  4.16  districts within which the city is located.  This paragraph does 
  4.17  not apply to cities of 500 population or less. 
  4.18     (k) The county initial hearing date and the city, 
  4.19  metropolitan special taxing district, regional library district, 
  4.20  and school district initial hearing dates must be designated on 
  4.21  the notices required under subdivision 3.  The continuation 
  4.22  hearing dates need not be stated on the notices.  
  4.23     (l) At a subsequent hearing, each county, school district, 
  4.24  city over 500 population, and metropolitan special taxing 
  4.25  district may amend its proposed property tax levy and must adopt 
  4.26  a final property tax levy.  Prior to adopting its final levy, 
  4.27  the governing body of a taxing authority in which the total 
  4.28  market value of the property included in any class of property 
  4.29  has declined since the previous levy year, must, in a separate 
  4.30  vote, indicate its intent to shift a portion of the property tax 
  4.31  levy onto the classes of property that have not declined in 
  4.32  market value, rather than to reduce its final budget to 
  4.33  compensate for the lost tax base.  At the option of the 
  4.34  governing body, one vote may be taken on all shifts among 
  4.35  classes within the taxing authority or separate votes may be 
  4.36  taken on the anticipated shift for each class.  Each county, 
  5.1   city over 500 population, and metropolitan special taxing 
  5.2   district may also amend its proposed budget and must adopt a 
  5.3   final budget at the subsequent hearing.  The final property tax 
  5.4   levy must be adopted prior to adopting the final budget.  A 
  5.5   school district is not required to adopt its final budget at the 
  5.6   subsequent hearing.  The subsequent hearing of a taxing 
  5.7   authority must be held on a date subsequent to the date of the 
  5.8   taxing authority's initial public hearing.  If a continuation 
  5.9   hearing is held, the subsequent hearing must be held either 
  5.10  immediately following the continuation hearing or on a date 
  5.11  subsequent to the continuation hearing.  The subsequent hearing 
  5.12  may be held at a regularly scheduled board or council meeting or 
  5.13  at a special meeting scheduled for the purposes of the 
  5.14  subsequent hearing.  The subsequent hearing of a taxing 
  5.15  authority does not have to be coordinated by the county auditor 
  5.16  to prevent a conflict with an initial hearing, a continuation 
  5.17  hearing, or a subsequent hearing of any other taxing authority.  
  5.18  All subsequent hearings must be held prior to five working days 
  5.19  after December 20 of the levy year.  The date, time, and place 
  5.20  of the subsequent hearing must be announced at the initial 
  5.21  public hearing or at the continuation hearing. 
  5.22     (m) The property tax levy certified under section 275.07 by 
  5.23  a city of any population, county, metropolitan special taxing 
  5.24  district, regional library district, or school district must not 
  5.25  exceed the proposed levy determined under subdivision 1, except 
  5.26  by an amount up to the sum of the following amounts: 
  5.27     (1) the amount of a school district levy whose voters 
  5.28  approved a referendum to increase taxes under section 123B.63, 
  5.29  subdivision 3, or 126C.17, subdivision 9, after the proposed 
  5.30  levy was certified; 
  5.31     (2) the amount of a city or county levy approved by the 
  5.32  voters after the proposed levy was certified; 
  5.33     (3) the amount of a levy to pay principal and interest on 
  5.34  bonds approved by the voters under section 475.58 after the 
  5.35  proposed levy was certified; 
  5.36     (4) the amount of a levy to pay costs due to a natural 
  6.1   disaster occurring after the proposed levy was certified, if 
  6.2   that amount is approved by the commissioner of revenue under 
  6.3   subdivision 6a; 
  6.4      (5) the amount of a levy to pay tort judgments against a 
  6.5   taxing authority that become final after the proposed levy was 
  6.6   certified, if the amount is approved by the commissioner of 
  6.7   revenue under subdivision 6a; 
  6.8      (6) the amount of an increase in levy limits certified to 
  6.9   the taxing authority by the commissioner of children, families, 
  6.10  and learning or the commissioner of revenue after the proposed 
  6.11  levy was certified; and 
  6.12     (7) the amount required under section 126C.55. 
  6.13     (n) This subdivision does not apply to towns and special 
  6.14  taxing districts other than regional library districts and 
  6.15  metropolitan special taxing districts. 
  6.16     (o) Notwithstanding the requirements of this section, the 
  6.17  employer is required to meet and negotiate over employee 
  6.18  compensation as provided for in chapter 179A. 
  6.19     Sec. 2.  [EFFECTIVE DATE.] 
  6.20     Section 1 is effective for property taxes levied in 1999, 
  6.21  payable in 2000, and thereafter.