1.1    .................... moves to amend H. F. No. 3149 as follows:
1.2Delete everything after the enacting clause and insert:


1.5    Section 1. Minnesota Statutes 2006, section 273.1384, subdivision 1, is amended to
1.6read:
1.7    Subdivision 1. Residential homestead market value credit. (a) Each county
1.8auditor shall determine a homestead credit for each class 1a, 1b, and 2a homestead
1.9property within the county equal to 0.4 percent of the first $76,000 of market value
1.10of the property minus .09 percent of the market value in excess of $76,000. The credit
1.11amount may not be less than zero. In the case of an agricultural or resort homestead, only
1.12the market value of the house, garage, and immediately surrounding one acre of land is
1.13eligible in determining the property's homestead credit. In the case of a property that
1.14is classified as part homestead and part nonhomestead, (i) the credit shall apply only
1.15to the homestead portion of the property, but (ii) if a portion of a property is classified
1.16as nonhomestead solely because not all the owners occupy the property, not all the
1.17owners have qualifying relatives occupying the property, or solely because not all the
1.18spouses of owners occupy the property, the credit amount shall be initially computed as
1.19if that nonhomestead portion were also in the homestead class and then prorated to the
1.20owner-occupant's percentage of ownership. For the purpose of this section, when an
1.21owner-occupant's spouse does not occupy the property, the percentage of ownership for
1.22the owner-occupant spouse is one-half of the couple's ownership percentage.
1.23    (b) For property taxes payable in 2009 and thereafter, the county auditor shall
1.24determine the amount of the homestead credit under paragraph (a) and this paragraph.
1.25The county auditor shall report the amount of the credit to the taxpayer on the property
1.26tax statement or in another manner, as authorized by the commissioner of revenue. The
2.1amount of the credit allowed for the property taxes payable year is to be computed as the
2.2following percentage of the credit amount under paragraph (a):
2.3    (1) for property taxes payable in 2009, 100 percent;
2.4    (2) for property taxes payable in 2010, 60 percent;
2.5    (3) for property taxes payable in 2011, 45 percent;
2.6    (4) for property taxes payable in 2012, 30 percent;
2.7    (5) for property taxes payable in 2013, 15 percent; and
2.8    (6) for property taxes payable in 2014 or thereafter, no credit is allowed.
2.9EFFECTIVE DATE.This section is effective beginning for property taxes payable
2.10in 2009.

2.11    Sec. 2. Minnesota Statutes 2006, section 276.04, subdivision 2, as amended by Laws
2.122008, chapter 154, article 2, section 19, is amended to read:
2.13    Subd. 2. Contents of tax statements. (a) The treasurer shall provide for the
2.14printing of the tax statements. The commissioner of revenue shall prescribe the form
2.15of the property tax statement and its contents. The statement must contain a tabulated
2.16statement of the dollar amount due to each taxing authority and the amount of the state
2.17tax from the parcel of real property for which a particular tax statement is prepared. The
2.18dollar amounts attributable to the county, the state tax, the voter approved school tax, the
2.19other local school tax, the township or municipality, and the total of the metropolitan
2.20special taxing districts as defined in section 275.065, subdivision 3, paragraph (i), must
2.21be separately stated. The amounts due all other special taxing districts, if any, may be
2.22aggregated except that any levies made by the regional rail authorities in the county of
2.23Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 398A
2.24shall be listed on a separate line directly under the appropriate county's levy. If the county
2.25levy under this paragraph includes an amount for a lake improvement district as defined
2.26under sections 103B.501 to 103B.581, the amount attributable for that purpose must be
2.27separately stated from the remaining county levy amount. In the case of Ramsey County,
2.28if the county levy under this paragraph includes an amount for public library service
2.29under section 134.07, the amount attributable for that purpose may be separated from the
2.30remaining county levy amount. The amount of the tax on homesteads qualifying under the
2.31senior citizens' property tax deferral program under chapter 290B is the total amount of
2.32property tax before subtraction of the deferred property tax amount. The amount of the
2.33tax on contamination value imposed under sections 270.91 to 270.98, if any, must also
2.34be separately stated. The dollar amounts, including the dollar amount of any special
2.35assessments, may be rounded to the nearest even whole dollar. For purposes of this section
3.1whole odd-numbered dollars may be adjusted to the next higher even-numbered dollar.
3.2The amount of market value excluded under section 273.11, subdivision 16, if any, must
3.3also be listed on the tax statement.
3.4    (b) The property tax statements for manufactured homes and sectional structures
3.5taxed as personal property shall contain the same information that is required on the
3.6tax statements for real property.
3.7    (c) Real and personal property tax statements must contain the following information
3.8in the order given in this paragraph. The information must contain the current year tax
3.9information in the right column with the corresponding information for the previous year
3.10in a column on the left:
3.11    (1) the property's estimated market value under section 273.11, subdivision 1;
3.12    (2) the property's taxable market value after reductions under section 273.11,
3.13subdivisions 1a and 16 ;
3.14    (3) the property's gross tax, before credits; any items required by the commissioner
3.15of revenue under section 273.1384, subdivision 1, paragraph (b); and
3.16    (4) for homestead residential and agricultural properties, the credits under section
3.17273.1384;
3.18    (5) any credits received under sections 273.119; 273.123; 273.135; 273.1391;
3.19273.1398, subdivision 4; 469.171; and 473H.10, except that the amount of credit received
3.20under section 273.135 must be separately stated and identified as "taconite tax relief"; and
3.21    (6) (4) the net tax payable in the manner required in paragraph (a).
3.22    (d) If the county uses envelopes for mailing property tax statements and if the county
3.23agrees, a taxing district may include a notice with the property tax statement notifying
3.24taxpayers when the taxing district will begin its budget deliberations for the current
3.25year, and encouraging taxpayers to attend the hearings. If the county allows notices to
3.26be included in the envelope containing the property tax statement, and if more than
3.27one taxing district relative to a given property decides to include a notice with the tax
3.28statement, the county treasurer or auditor must coordinate the process and may combine
3.29the information on a single announcement.
3.30EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
3.31thereafter.

3.32    Sec. 3. Minnesota Statutes 2006, section 290.01, subdivision 19a, as amended by Laws
3.332008, chapter 154, article 3, section 2, and Laws 2008, chapter 154, article 4, section 3,
3.34is amended to read:
4.1    Subd. 19a. Additions to federal taxable income. For individuals, estates, and
4.2trusts, there shall be added to federal taxable income:
4.3    (1)(i) interest income on obligations of any state other than Minnesota or a political
4.4or governmental subdivision, municipality, or governmental agency or instrumentality
4.5of any state other than Minnesota exempt from federal income taxes under the Internal
4.6Revenue Code or any other federal statute; and
4.7    (ii) exempt-interest dividends as defined in section 852(b)(5) of the Internal Revenue
4.8Code, except the portion of the exempt-interest dividends derived from interest income
4.9on obligations of the state of Minnesota or its political or governmental subdivisions,
4.10municipalities, governmental agencies or instrumentalities, but only if the portion of the
4.11exempt-interest dividends from such Minnesota sources paid to all shareholders represents
4.1295 percent or more of the exempt-interest dividends that are paid by the regulated
4.13investment company as defined in section 851(a) of the Internal Revenue Code, or the
4.14fund of the regulated investment company as defined in section 851(g) of the Internal
4.15Revenue Code, making the payment; and
4.16    (iii) for the purposes of items (i) and (ii), interest on obligations of an Indian tribal
4.17government described in section 7871(c) of the Internal Revenue Code shall be treated as
4.18interest income on obligations of the state in which the tribe is located;
4.19    (2) the amount of (i) income or sales and use taxes paid or accrued within the
4.20taxable year under this chapter and the amount of taxes based on net income paid or sales
4.21and use taxes paid to any other state or to any province or territory of Canada, and (ii)
4.22the amount of real and personal property taxes paid or accrued within the taxable year,
4.23to the extent allowed as a deduction under section 63(d) of the Internal Revenue Code,
4.24but the addition may not be more than the amount by which the itemized deductions as
4.25allowed under section 63(d) of the Internal Revenue Code exceeds the amount of the
4.26standard deduction as defined in section 63(c) of the Internal Revenue Code. For the
4.27purpose of this paragraph, the disallowance of itemized deductions under section 68 of the
4.28Internal Revenue Code of 1986, income or sales and use tax is the last itemized deduction
4.29disallowed, real property tax is the second to last itemized deduction disallowed, and
4.30personal property tax is the third to last itemized deduction disallowed;
4.31    (3) the capital gain amount of a lump sum distribution to which the special tax under
4.32section 1122(h)(3)(B)(ii) of the Tax Reform Act of 1986, Public Law 99-514, applies;
4.33    (4) the amount of income taxes paid or accrued within the taxable year under this
4.34chapter and taxes based on net income paid to any other state or any province or territory
4.35of Canada, to the extent allowed as a deduction in determining federal adjusted gross
5.1income. For the purpose of this paragraph, income taxes do not include the taxes imposed
5.2by sections 290.0922, subdivision 1, paragraph (b), 290.9727, 290.9728, and 290.9729;
5.3    (5) the amount of expense, interest, or taxes disallowed pursuant to section 290.10
5.4other than expenses or interest used in computing net interest income for the subtraction
5.5allowed under subdivision 19b, clause (1);
5.6    (6) the amount of a partner's pro rata share of net income which does not flow
5.7through to the partner because the partnership elected to pay the tax on the income under
5.8section 6242(a)(2) of the Internal Revenue Code;
5.9    (7) 80 percent of the depreciation deduction allowed under section 168(k) of the
5.10Internal Revenue Code. For purposes of this clause, if the taxpayer has an activity that
5.11in the taxable year generates a deduction for depreciation under section 168(k) and the
5.12activity generates a loss for the taxable year that the taxpayer is not allowed to claim for
5.13the taxable year, "the depreciation allowed under section 168(k)" for the taxable year is
5.14limited to excess of the depreciation claimed by the activity under section 168(k) over the
5.15amount of the loss from the activity that is not allowed in the taxable year. In succeeding
5.16taxable years when the losses not allowed in the taxable year are allowed, the depreciation
5.17under section 168(k) is allowed;
5.18    (8) 80 percent of the amount by which the deduction allowed by section 179 of the
5.19Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal
5.20Revenue Code of 1986, as amended through December 31, 2003;
5.21    (9) to the extent deducted in computing federal taxable income, the amount of the
5.22deduction allowable under section 199 of the Internal Revenue Code;
5.23    (10) the exclusion allowed under section 139A of the Internal Revenue Code for
5.24federal subsidies for prescription drug plans;
5.25    (11) the amount of expenses disallowed under section 290.10, subdivision 2;
5.26    (12) for taxable years beginning after December 31, 2006, and before January 1,
5.272008, the amount deducted for qualified tuition and related expenses under section 222 of
5.28the Internal Revenue Code, to the extent deducted from gross income; and
5.29    (13) for taxable years beginning after December 31, 2006, and before January 1,
5.302008, the amount deducted for certain expenses of elementary and secondary school
5.31teachers under section 62(a)(2)(D) of the Internal Revenue Code, to the extent deducted
5.32from gross income.
5.33EFFECTIVE DATE.This section is effective for taxable years beginning after
5.34December 31, 2008.

5.35    Sec. 4. Minnesota Statutes 2006, section 290A.03, subdivision 13, is amended to read:
6.1    Subd. 13. Property taxes payable. "Property taxes payable" means the property
6.2tax exclusive of special assessments, penalties, and interest payable on a claimant's
6.3homestead after deductions made under sections 273.135, 273.1384, 273.1391, 273.42,
6.4subdivision 2 , and any other state paid property tax credits in any calendar year, and
6.5after any refund claimed and allowable under section 290A.04, subdivision 2h, that is
6.6first payable in the year that the property tax is payable. Beginning for property taxes
6.7payable in 2009, the amount of the credit under section 273.1384, subdivision 1, must
6.8not be deducted in computing property taxes payable. In the case of a claimant who
6.9makes ground lease payments, "property taxes payable" includes the amount of the
6.10payments directly attributable to the property taxes assessed against the parcel on which
6.11the house is located. No apportionment or reduction of the "property taxes payable" shall
6.12be required for the use of a portion of the claimant's homestead for a business purpose if
6.13the claimant does not deduct any business depreciation expenses for the use of a portion
6.14of the homestead in the determination of federal adjusted gross income. For homesteads
6.15which are manufactured homes as defined in section 273.125, subdivision 8, and for
6.16homesteads which are park trailers taxed as manufactured homes under section 168.012,
6.17subdivision 9 , "property taxes payable" shall also include 19 percent of the gross rent paid
6.18in the preceding year for the site on which the homestead is located. When a homestead
6.19is owned by two or more persons as joint tenants or tenants in common, such tenants
6.20shall determine between them which tenant may claim the property taxes payable on the
6.21homestead. If they are unable to agree, the matter shall be referred to the commissioner of
6.22revenue whose decision shall be final. Property taxes are considered payable in the year
6.23prescribed by law for payment of the taxes.
6.24    In the case of a claim relating to "property taxes payable," the claimant must have
6.25owned and occupied the homestead on January 2 of the year in which the tax is payable
6.26and (i) the property must have been classified as homestead property pursuant to section
6.27273.124 , on or before December 15 of the assessment year to which the "property taxes
6.28payable" relate; or (ii) the claimant must provide documentation from the local assessor
6.29that application for homestead classification has been made on or before December 15
6.30of the year in which the "property taxes payable" were payable and that the assessor has
6.31approved the application.
6.32EFFECTIVE DATE.This section is effective beginning for refund claims based on
6.33property taxes payable in 2009.

6.34    Sec. 5. Minnesota Statutes 2006, section 290A.04, subdivision 2h, is amended to read:
7.1    Subd. 2h. Additional refund. (a) If the gross property taxes payable on a
7.2homestead increase more than 12 percent over the property taxes payable in the prior year
7.3on the same property that is owned and occupied by the same owner on January 2 of both
7.4years, and the amount of that increase is $100 or more, a claimant who is a homeowner
7.5shall be allowed an additional refund equal to 60 percent of the amount of the increase
7.6over the greater of 12 percent of the prior year's property taxes payable or $100. This
7.7subdivision shall not apply to any increase in the gross property taxes payable attributable
7.8to improvements made to the homestead after the assessment date for the prior year's
7.9taxes. This subdivision shall not apply to any increase in the gross property taxes payable
7.10attributable to the termination of valuation exclusions under section 273.11, subdivision
7.1116 , or to the reduction in and elimination of the homestead market value credit under
7.12section 273.1384, subdivision 1, paragraph (b).
7.13    The maximum refund allowed under this subdivision is $1,000.
7.14    (b) For purposes of this subdivision "gross property taxes payable" means property
7.15taxes payable determined without regard to the refund allowed under this subdivision.
7.16    (c) In addition to the other proofs required by this chapter, each claimant under
7.17this subdivision shall file with the property tax refund return a copy of the property tax
7.18statement for taxes payable in the preceding year or other documents required by the
7.19commissioner.
7.20    (d) Upon request, the appropriate county official shall make available the names and
7.21addresses of the property taxpayers who may be eligible for the additional property tax
7.22refund under this section. The information shall be provided on a magnetic computer
7.23disk. The county may recover its costs by charging the person requesting the information
7.24the reasonable cost for preparing the data. The information may not be used for any
7.25purpose other than for notifying the homeowner of potential eligibility and assisting the
7.26homeowner, without charge, in preparing a refund claim.
7.27EFFECTIVE DATE.This section is effective for claims based on property taxes
7.28payable in 2009 and thereafter.

7.29    Sec. 6. Minnesota Statutes 2006, section 290A.04, is amended by adding a subdivision
7.30to read:
7.31    Subd. 2k. Homestead credit state refund. (a) A claimant who is a homeowner
7.32is entitled to a state refund of the amount of the property taxes payable in excess of two
7.33percent of the claimant's household income, based on the percentage and maximum for the
7.34appropriate household income level shown below. The refund amount determined from the
8.1table must be reduced further by the amount of the homestead market value credit under
8.2section 273.1384, subdivision 1, paragraph (b), but not to an amount that is less than zero.

8.3	Household Income	Refund Percentage	Maximum State Refund
8.4	0 to $5,399	90 percent	$2,500
8.5	5,400 to 18,899	85 percent	2,500
8.6	18,900 to 26,999	80 percent	2,500
8.7	27,000 to 32,399	70 percent	2,500
8.8	32,400 to 37,799	65 percent	2,500
8.9	37,800 to 45,899	60 percent	2,500
8.10	45,900 to 64,699	55 percent	2,500
8.11	64,700 to 80,899	50 percent	2,300
8.12	80,900 to 94,399	45 percent	2,100
8.13	94,400 to 99,299	40 percent	1,900
8.14	99,300 to 104,099	35 percent	1,700
8.15	104,100 to 115,599	30 percent	1,500
8.16	115,600 to 127,199	25 percent	1,250
8.17	127,200 to 134,099	25 percent	1,000
8.18	134,100 to 138,799	25 percent	750
8.19	138,800 to 144,399	25 percent	500
8.20	144,400 to 200,000	25 percent	250

8.21    (b) No payment is allowed under paragraph (a) if the claimant's household income
8.22is more than $200,000.
8.23EFFECTIVE DATE.This section is effective beginning for claims based on
8.24property taxes payable in 2009.

8.25    Sec. 7. Minnesota Statutes 2006, section 290A.04, subdivision 3, is amended to read:
8.26    Subd. 3. Table. The commissioner of revenue shall construct and make available
8.27to taxpayers a comprehensive table showing the property taxes to be paid and refund
8.28allowed at various levels of income and assessment. The table shall follow the schedule
8.29of income percentages, maximums and other provisions specified in subdivision 2 this
8.30section, except that the commissioner may graduate the transition between income
8.31brackets. All refunds shall be computed in accordance with tables prepared and issued
8.32by the commissioner of revenue.
8.33    The commissioner shall include on the form an appropriate space or method for the
8.34claimant to identify if the property taxes paid are for a manufactured home, as defined in
8.35section 273.125, subdivision 8, paragraph (c), or a park trailer taxed as a manufactured
8.36home under section 168.012, subdivision 9.

8.37    Sec. 8. Minnesota Statutes 2006, section 290A.04, subdivision 4, is amended to read:
9.1    Subd. 4. Inflation adjustment. (a) Beginning for property tax refunds payable in
9.2calendar year 2002 2010, the commissioner shall annually adjust the dollar amounts of the
9.3income thresholds and the maximum refunds under subdivisions 2 and 2a subdivision 2k
9.4for inflation. The commissioner shall make the inflation adjustments in accordance with
9.5section 1(f) of the Internal Revenue Code, except that for purposes of this subdivision
9.6the percentage increase shall be determined from the year ending on June 30, 2000 2008,
9.7to the year ending on June 30 of the year preceding that in which the refund is payable.
9.8The commissioner shall use the appropriate percentage increase to annually adjust the
9.9income thresholds and maximum refunds under subdivisions 2 and 2a subdivision 2k for
9.10inflation without regard to whether or not the income tax brackets are adjusted for inflation
9.11in that year. The commissioner shall round the thresholds and the maximum amounts,
9.12as adjusted to the nearest $10 amount. If the amount ends in $5, the commissioner shall
9.13round it up to the next $10 amount.
9.14    The commissioner shall annually announce the adjusted refund schedule at the same
9.15time provided under section 290.06. The determination of the commissioner under this
9.16subdivision is not a rule under the Administrative Procedure Act.
9.17    (b) Beginning for property tax refunds payable in calendar year 2002, the
9.18commissioner shall annually adjust the dollar amounts of the income thresholds and
9.19the maximum refunds under subdivision 2a for inflation. The commissioner shall make
9.20the inflation adjustments in accordance with section 1(f) of the Internal Revenue Code,
9.21except that for purposes of this subdivision the percentage increase shall be determined
9.22from the year ending on June 30, 2000, to the year ending on June 30 of the year
9.23preceding that in which the refund is payable. The commissioner shall use the appropriate
9.24percentage increase to annually adjust the income thresholds and maximum refunds under
9.25subdivision 2a for inflation without regard to whether or not the income tax brackets are
9.26adjusted for inflation in that year. The commissioner shall round the thresholds and the
9.27maximum amounts, as adjusted to the nearest $10 amount. If the amount ends in $5, the
9.28commissioner shall round it up to the next $10 amount. The commissioner shall annually
9.29announce the adjusted refund schedule at the same time provided under section 290.06.
9.30The determination of the commissioner under this subdivision is not a rule under the
9.31Administrative Procedure Act.
9.32EFFECTIVE DATE.This section is effective beginning for claims based on
9.33property taxes payable in 2010.

9.34    Sec. 9. REPEALER.
9.35Minnesota Statutes 2006, section 290A.04, subdivisions 2 and 2b, are repealed.
10.1EFFECTIVE DATE.This section is effective for claims based on property taxes
10.2payable in 2009 and thereafter.


10.5    Section 1. Minnesota Statutes 2006, section 477A.011, subdivision 34, is amended to
10.6read:
10.7    Subd. 34. City revenue need. (a) For a city with a population equal to or greater
10.8than 2,500, "city revenue need" is the sum of (1) 5.0734098 times the pre-1940 housing
10.9percentage; plus (2) 19.141678 times the population decline percentage; plus (3)
10.102504.06334 times the road accidents factor; plus (4) 355.0547; minus (5) the metropolitan
10.11area factor; minus (6) 49.10638 times the household size.
10.12    (b) For a city with a population less than 2,500, "city revenue need" is the sum of
10.13(1) 2.387 times the pre-1940 housing percentage; plus (2) 2.67591 times the commercial
10.14industrial percentage; plus (3) 3.16042 times the population decline percentage; plus (4)
10.151.206 times the transformed population; minus (5) 62.772.
10.16    (c) For a city with a population of 2,500 or more and a population in one of the most
10.17recently available five years that was less than 2,500, "city revenue need" is the sum of (1)
10.18its city revenue need calculated under paragraph (a) multiplied by its transition factor;
10.19plus (2) its city revenue need calculated under the formula in paragraph (b) multiplied
10.20by the difference between one and its transition factor. For purposes of this paragraph, a
10.21city's "transition factor" is equal to 0.2 multiplied by the number of years that the city's
10.22population estimate has been 2,500 or more. This provision only applies for aids payable
10.23in calendar years 2006 to 2008 to cities with a 2002 population of less than 2,500. It
10.24applies to any city for aids payable in 2009 and thereafter. The city revenue need under
10.25this paragraph may not be less than 290.
10.26    (d) The city revenue need cannot be less than zero.
10.27    (e) For aids certified in 2010 and subsequent years, the city revenue need is equal
10.28to the average of (1) the city's revenue need calculated under paragraphs (a) to (d)
10.29based on data available by January 1 in the year the aid is certified, and (2) its revenue
10.30need calculated under paragraphs (a) to (d) based on data available by January 1 in the
10.31previous year.
10.32    (e) (f) For calendar year 2005 and subsequent years, the city revenue need for a city,
10.33as determined in paragraphs (a) to (d) (e), is multiplied by the ratio of the annual implicit
10.34price deflator for government consumption expenditures and gross investment for state
10.35and local governments as prepared by the United States Department of Commerce, for
11.1the most recently available year to the 2003 implicit price deflator for state and local
11.2government purchases.
11.3EFFECTIVE DATE.This section is effective for aids payable in calendar year
11.42009 and thereafter.

11.5    Sec. 2. Minnesota Statutes 2006, section 477A.011, subdivision 36, as amended by
11.6Laws 2008, chapter 154, article 1, section 1, is amended to read:
11.7    Subd. 36. City aid base. (a) Except as otherwise provided in this subdivision,
11.8"city aid base" is zero.
11.9    (b) The city aid base for any city with a population less than 500 is increased by
11.10$40,000 for aids payable in calendar year 1995 and thereafter, and the maximum amount
11.11of total aid it may receive under section 477A.013, subdivision 9, paragraph (c), is also
11.12increased by $40,000 for aids payable in calendar year 1995 only, provided that:
11.13    (i) the average total tax capacity rate for taxes payable in 1995 exceeds 200 percent;
11.14    (ii) the city portion of the tax capacity rate exceeds 100 percent; and
11.15    (iii) its city aid base is less than $60 per capita.
11.16    (c) The city aid base for a city is increased by $20,000 in 1998 and thereafter and
11.17the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
11.18paragraph (c), is also increased by $20,000 in calendar year 1998 only, provided that:
11.19    (i) the city has a population in 1994 of 2,500 or more;
11.20    (ii) the city is located in a county, outside of the metropolitan area, which contains a
11.21city of the first class;
11.22    (iii) the city's net tax capacity used in calculating its 1996 aid under section
11.23477A.013 is less than $400 per capita; and
11.24    (iv) at least four percent of the total net tax capacity, for taxes payable in 1996, of
11.25property located in the city is classified as railroad property.
11.26    (d) The city aid base for a city is increased by $200,000 in 1999 and thereafter and
11.27the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
11.28paragraph (c), is also increased by $200,000 in calendar year 1999 only, provided that:
11.29    (i) the city was incorporated as a statutory city after December 1, 1993;
11.30    (ii) its city aid base does not exceed $5,600; and
11.31    (iii) the city had a population in 1996 of 5,000 or more.
11.32    (e) The city aid base for a city is increased by $450,000 in 1999 to 2008 and the
11.33maximum amount of total aid it may receive under section 477A.013, subdivision 9,
11.34paragraph (c), is also increased by $450,000 in calendar year 1999 only, provided that:
11.35    (i) the city had a population in 1996 of at least 50,000;
12.1    (ii) its population had increased by at least 40 percent in the ten-year period ending
12.2in 1996; and
12.3    (iii) its city's net tax capacity for aids payable in 1998 is less than $700 per capita.
12.4    (f) (e) The city aid base for a city is increased by $150,000 for aids payable in
12.52000 and thereafter, and the maximum amount of total aid it may receive under section
12.6477A.013, subdivision 9 , paragraph (c), is also increased by $150,000 in calendar year
12.72000 only, provided that:
12.8    (1) the city has a population that is greater than 1,000 and less than 2,500;
12.9    (2) its commercial and industrial percentage for aids payable in 1999 is greater
12.10than 45 percent; and
12.11    (3) the total market value of all commercial and industrial property in the city
12.12for assessment year 1999 is at least 15 percent less than the total market value of all
12.13commercial and industrial property in the city for assessment year 1998.
12.14    (g) (f) The city aid base for a city is increased by $200,000 in 2000 and thereafter,
12.15and the maximum amount of total aid it may receive under section 477A.013, subdivision
12.169 , paragraph (c), is also increased by $200,000 in calendar year 2000 only, provided that:
12.17    (1) the city had a population in 1997 of 2,500 or more;
12.18    (2) the net tax capacity of the city used in calculating its 1999 aid under section
12.19477A.013 is less than $650 per capita;
12.20    (3) the pre-1940 housing percentage of the city used in calculating 1999 aid under
12.21section 477A.013 is greater than 12 percent;
12.22    (4) the 1999 local government aid of the city under section 477A.013 is less than
12.2320 percent of the amount that the formula aid of the city would have been if the need
12.24increase percentage was 100 percent; and
12.25    (5) the city aid base of the city used in calculating aid under section 477A.013
12.26is less than $7 per capita.
12.27    (h) (g) The city aid base for a city is increased by $102,000 in 2000 and thereafter,
12.28and the maximum amount of total aid it may receive under section 477A.013, subdivision
12.299 , paragraph (c), is also increased by $102,000 in calendar year 2000 only, provided that:
12.30    (1) the city has a population in 1997 of 2,000 or more;
12.31    (2) the net tax capacity of the city used in calculating its 1999 aid under section
12.32477A.013 is less than $455 per capita;
12.33    (3) the net levy of the city used in calculating 1999 aid under section 477A.013 is
12.34greater than $195 per capita; and
13.1    (4) the 1999 local government aid of the city under section 477A.013 is less than
13.238 percent of the amount that the formula aid of the city would have been if the need
13.3increase percentage was 100 percent.
13.4    (i) (h) The city aid base for a city is increased by $32,000 in 2001 and thereafter, and
13.5the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
13.6paragraph (c), is also increased by $32,000 in calendar year 2001 only, provided that:
13.7    (1) the city has a population in 1998 that is greater than 200 but less than 500;
13.8    (2) the city's revenue need used in calculating aids payable in 2000 was greater
13.9than $200 per capita;
13.10    (3) the city net tax capacity for the city used in calculating aids available in 2000
13.11was equal to or less than $200 per capita;
13.12    (4) the city aid base of the city used in calculating aid under section 477A.013
13.13is less than $65 per capita; and
13.14    (5) the city's formula aid for aids payable in 2000 was greater than zero.
13.15    (j) (i) The city aid base for a city is increased by $7,200 in 2001 and thereafter, and
13.16the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
13.17paragraph (c), is also increased by $7,200 in calendar year 2001 only, provided that:
13.18    (1) the city had a population in 1998 that is greater than 200 but less than 500;
13.19    (2) the city's commercial industrial percentage used in calculating aids payable in
13.202000 was less than ten percent;
13.21    (3) more than 25 percent of the city's population was 60 years old or older according
13.22to the 1990 census;
13.23    (4) the city aid base of the city used in calculating aid under section 477A.013
13.24is less than $15 per capita; and
13.25    (5) the city's formula aid for aids payable in 2000 was greater than zero.
13.26    (k) (j) The city aid base for a city is increased by $45,000 in 2001 and thereafter
13.27and by an additional $50,000 in calendar years 2002 to 2011, and the maximum amount
13.28of total aid it may receive under section 477A.013, subdivision 9, paragraph (c), is also
13.29increased by $45,000 in calendar year 2001 only, and by $50,000 in calendar year 2002
13.30only, provided that:
13.31    (1) the net tax capacity of the city used in calculating its 2000 aid under section
13.32477A.013 is less than $810 per capita;
13.33    (2) the population of the city declined more than two percent between 1988 and 1998;
13.34    (3) the net levy of the city used in calculating 2000 aid under section 477A.013 is
13.35greater than $240 per capita; and
14.1    (4) the city received less than $36 per capita in aid under section 477A.013,
14.2subdivision 9 , for aids payable in 2000.
14.3    (l) (k) The city aid base for a city with a population of 10,000 or more which is
14.4located outside of the seven-county metropolitan area is increased in 2002 and thereafter,
14.5and the maximum amount of total aid it may receive under section 477A.013, subdivision
14.69 , paragraph (b) or (c), is also increased in calendar year 2002 only, by an amount equal to
14.7the lesser of:
14.8    (1)(i) the total population of the city, as determined by the United States Bureau of
14.9the Census, in the 2000 census, (ii) minus 5,000, (iii) times 60; or
14.10    (2) $2,500,000.
14.11    (m) (l) The city aid base is increased by $50,000 in 2002 and thereafter, and the
14.12maximum amount of total aid it may receive under section 477A.013, subdivision 9,
14.13paragraph (c), is also increased by $50,000 in calendar year 2002 only, provided that:
14.14    (1) the city is located in the seven-county metropolitan area;
14.15    (2) its population in 2000 is between 10,000 and 20,000; and
14.16    (3) its commercial industrial percentage, as calculated for city aid payable in 2001,
14.17was greater than 25 percent.
14.18    (n) (m) The city aid base for a city is increased by $150,000 in calendar years 2002
14.19to 2011 and by an additional $75,000 in calendar years 2009 to 2014 and the maximum
14.20amount of total aid it may receive under section 477A.013, subdivision 9, paragraph (c), is
14.21also increased by $150,000 in calendar year 2002 only and by $75,000 in calendar year
14.222009 only, provided that:
14.23    (1) the city had a population of at least 3,000 but no more than 4,000 in 1999;
14.24    (2) its home county is located within the seven-county metropolitan area;
14.25    (3) its pre-1940 housing percentage is less than 15 percent; and
14.26    (4) its city net tax capacity per capita for taxes payable in 2000 is less than $900
14.27per capita.
14.28    (o) (n) The city aid base for a city is increased by $200,000 beginning in calendar
14.29year 2003 and the maximum amount of total aid it may receive under section 477A.013,
14.30subdivision 9 , paragraph (c), is also increased by $200,000 in calendar year 2003 only,
14.31provided that the city qualified for an increase in homestead and agricultural credit aid
14.32under Laws 1995, chapter 264, article 8, section 18.
14.33    (p) (o) The city aid base for a city is increased by $200,000 in 2004 only and the
14.34maximum amount of total aid it may receive under section 477A.013, subdivision 9, is
14.35also increased by $200,000 in calendar year 2004 only, if the city is the site of a nuclear
14.36dry cask storage facility.
15.1    (q) (p) The city aid base for a city is increased by $10,000 in 2004 and thereafter
15.2and the maximum total aid it may receive under section 477A.013, subdivision 9, is also
15.3increased by $10,000 in calendar year 2004 only, if the city was included in a federal
15.4major disaster designation issued on April 1, 1998, and its pre-1940 housing stock was
15.5decreased by more than 40 percent between 1990 and 2000.
15.6    (r) (q) The city aid base for a city is increased by $30,000 in 2009 and thereafter
15.7and the maximum total aid it may receive under section 477A.013, subdivision 9, is also
15.8increased by $25,000 in calendar year 2006 only if the city had a population in 2003
15.9of at least 1,000 and has a state park for which the city provides rescue services and
15.10which comprised at least 14 percent of the total geographic area included within the
15.11city boundaries in 2000.
15.12    (s) The city aid base for a city with a population less than 5,000 is increased in
15.132006 and thereafter and the minimum and maximum amount of total aid it may receive
15.14under this section is also increased in calendar year 2006 only by an amount equal to
15.15$6 multiplied by its population.
15.16    (t) (r) The city aid base for a city is increased by $80,000 in 2009 and thereafter and
15.17the minimum and maximum amount of total aid it may receive under section 477A.013,
15.18subdivision 9, is also increased by $80,000 in calendar year 2009 only, if:
15.19    (1) as of May 1, 2006, at least 25 percent of the tax capacity of the city is proposed
15.20to be placed in trust status as tax-exempt Indian land;
15.21    (2) the placement of the land is being challenged administratively or in court; and
15.22    (3) due to the challenge, the land proposed to be placed in trust is still on the tax
15.23rolls as of May 1, 2006.
15.24    (u) (s) The city aid base for a city is increased by $100,000 in 2007 and thereafter
15.25and the minimum and maximum total amount of aid it may receive under this section is
15.26also increased in calendar year 2007 only, provided that:
15.27    (1) the city has a 2004 estimated population greater than 200 but less than 2,000;
15.28    (2) its city net tax capacity for aids payable in 2006 was less than $300 per capita;
15.29    (3) the ratio of its pay 2005 tax levy compared to its city net tax capacity for aids
15.30payable in 2006 was greater than 110 percent; and
15.31    (4) it is located in a county where at least 15,000 acres of land are classified as
15.32tax-exempt Indian reservations according to the 2004 abstract of tax-exempt property.
15.33    (v) (t) The city aid base for a city is increased by $30,000 in 2009 only, and the
15.34maximum total aid it may receive under section 477A.013, subdivision 9, is also increased
15.35by $30,000 in calendar year 2009, only if the city had a population in 2005 of less than
16.13,000 and the city's boundaries as of 2007 were formed by the consolidation of two cities
16.2and one township in 2002.
16.3    (u) The city aid base for a city is increased by $100,000 in 2009 and thereafter, and
16.4the maximum total aid it may receive under section 477A.013, subdivision 9, is also
16.5increased by $100,000 in calendar year 2009 only, if the city had a city net tax capacity for
16.6aids payable in 2007 of less than $150 per capita and the city experienced flooding on
16.7March 14, 2007, that resulted in evacuation of at least 40 homes.
16.8    (v) The city aid base for a city is increased by $200,000 in 2009 to 2013, and the
16.9maximum total aid it may receive under section 477A.013, subdivision 9, is also increased
16.10by $200,000 in calendar year 2009 only, if the city:
16.11    (1) is located outside of the Minneapolis-St. Paul standard metropolitan statistical
16.12area;
16.13    (2) has a 2005 population greater than 7,000 but less than 8,000; and
16.14    (3) has a 2005 net tax capacity per capita of less than $500.
16.15    (w) The city aid base is increased by $80,000 in calendar years 2009 to 2018 and the
16.16maximum amount of total aid it may receive under section 477A.013, subdivision 9, is
16.17increased by $80,000 in calendar year 2009 only, provided that:
16.18    (1) the city is located in the seven-county metropolitan area;
16.19    (2) its population in 2006 is less than 200; and
16.20    (3) the percentage of its housing stock built before 1940, according to the 2000
16.21United States Census, is greater than 40 percent.
16.22    (x) The city aid base for a city is increased by $100,000 in 2009 and thereafter and
16.23the minimum and maximum total amount of aid it may receive under this section is also
16.24increased by $100,000 in calendar year 2009 only, provided that:
16.25    (1) the city is located in the metropolitan area and its 2006 population is less than
16.262,500;
16.27    (2) at least 25 percent of its housing was built before 1940 and at least 50 percent of
16.28its housing is rental housing, according to the 2000 United States census;
16.29    (3) the median household income in the city is 80 percent or less than the median
16.30household income in the metropolitan area and 50 percent or less than the median
16.31household income for all cities contiguous to that city, according to the 2000 United
16.32States Census; and
16.33    (4) at least 60 percent of the land and water acres in the city are classified as
16.34tax-exempt property, according to its 2008 planning document.
16.35EFFECTIVE DATE.This section is effective for aids payable in calendar year
16.362009 and thereafter.

17.1    Sec. 3. Minnesota Statutes 2006, section 477A.011, is amended by adding a
17.2subdivision to read:
17.3    Subd. 41. Small city aid base. (a) "Small city aid base" for a city with a population
17.4less than 5,000 is equal to $9 multiplied by its population. The small city aid base for
17.5all other cities is equal to zero.
17.6    (b) For calendar year 2010 and subsequent years, the small city aid base for a city,
17.7as determined in paragraph (a), is multiplied by the ratio of the annual implicit price
17.8deflator for government consumption expenditures and gross investment for state and
17.9local governments as prepared by the United States Department of Commerce for the most
17.10recently available year to the 2007 implicit price deflator for state and local government
17.11purchases.
17.12EFFECTIVE DATE.This section is effective for aids payable in calendar year
17.132009 and thereafter.

17.14    Sec. 4. Minnesota Statutes 2006, section 477A.011, is amended by adding a
17.15subdivision to read:
17.16    Subd. 42. City jobs base. (a) "City jobs base" for a city with a population of 5,000
17.17or more is equal to the product of (1) $30, (2) the number of jobs per capita in the city, and
17.18(3) its population. For cities with a population less than 5,000, the city jobs base is equal
17.19to zero. For a city receiving aid under section 477A.011, subdivision 36, paragraph (l), its
17.20city jobs base is reduced by the lesser of the amount of aid received under that paragraph
17.21or $1,200,000. No city's jobs base may exceed $5,000,000 under this paragraph.
17.22    (b) For calendar year 2010 and subsequent years, the city jobs base for a city,
17.23as determined in paragraph (a), is multiplied by the ratio of the annual implicit price
17.24deflator for government consumption expenditures and gross investment for state and
17.25local governments as prepared by the United States Department of Commerce for the most
17.26recently available year to the 2007 implicit price deflator for state and local government
17.27purchases.
17.28    (c) For purposes of this subdivision, "jobs per capita in the city" means (1) the
17.29average annual number of employees in the city based on the data from the Quarterly
17.30Census of Employment and Wages, as reported by the Department of Employment and
17.31Economic Development, for the most recent calendar year available as of January 1 of
17.32the year in which the aid is calculated, divided by (2) the city's population for the same
17.33calendar year as the employment data.
17.34EFFECTIVE DATE.This section is effective for aids payable in calendar year
17.352009 and thereafter.

18.1    Sec. 5. Minnesota Statutes 2006, section 477A.0124, subdivision 5, is amended to read:
18.2    Subd. 5. County transition aid. (a) For 2005, a county is eligible for transition
18.3aid equal to the amount, if any, by which:
18.4    (1) the difference between:
18.5    (i) the aid the county received under subdivision 1 in 2004, divided by the total aid
18.6paid to all counties under subdivision 1, multiplied by $205,000,000; and
18.7    (ii) the amount of aid the county is certified to receive in 2005 under subdivisions
18.83 and 4;
18.9exceeds:
18.10    (2) three percent of the county's adjusted net tax capacity.
18.11A county's aid under this paragraph may not be less than zero.
18.12    (b) In 2006, a county is eligible to receive two-thirds of the transition aid it received
18.13in 2005.
18.14    (c) In 2007, For 2009 and each year thereafter, a county is eligible to receive
18.15one-third of the transition aid it received in 2005 2007.
18.16    (d) No county shall receive aid under this subdivision after 2007.
18.17    (b) In 2009 only, a county with (1) a 2006 population less than 30,000, and (2)
18.18an average Part I crimes per capita greater than 3.9 percent based on factors used in
18.19determining county program aid payable in 2008, shall receive $100,000.
18.20    (c) For aids payable in 2009, 2010, and 2011 only, $250,000 each year shall be
18.21distributed to any county in which (1) the 2006 estimated population exceeds 30,000, and
18.22(2) the 2006 percentage of households receiving food stamps exceeds 15 percent, based
18.23on data used in computing county program aids for aids payable in 2008 and the 2006
18.24estimated household count according to the state demographer. The aid must be used to
18.25meet the county's cost of out-of-home placement programs.
18.26EFFECTIVE DATE.This section is effective for aids payable in 2009 and
18.27thereafter.

18.28    Sec. 6. Minnesota Statutes 2006, section 477A.013, subdivision 1, is amended to read:
18.29    Subdivision 1. Towns. In 2002, no In calendar year 2009 and subsequent years,
18.30each organized town is eligible for a distribution under this subdivision equal to $100 plus
18.31the product of the town aid factor multiplied by its population. Each county with one or
18.32more unorganized townships shall receive $100 plus the product of the town aid factor
18.33multiplied by the total population in all unorganized townships in the county.
19.1    The "town aid factor" is the same for all towns and must be calculated by the
19.2Department of Revenue so that the total aid under this subdivision equals the total amount
19.3available for aid under section 477A.03.
19.4EFFECTIVE DATE.This section is effective for aids payable in calendar year
19.52009 and thereafter.

19.6    Sec. 7. Minnesota Statutes 2006, section 477A.013, subdivision 8, as amended by
19.7Laws 2008, chapter 154, article 1, section 2, is amended to read:
19.8    Subd. 8. City formula aid. In calendar year 2004 2009 and subsequent years, the
19.9formula aid for a city is equal to the sum of (1) its city jobs base, (2) its small city aid base,
19.10and (3) the need increase percentage multiplied by the difference between (1) (i) the
19.11city's revenue need multiplied by its population, and (2) (ii) the sum of the city's net tax
19.12capacity multiplied by the tax effort rate.
19.13No city may have a formula aid amount less than zero. The need increase percentage
19.14must be the same for all cities.
19.15    The applicable need increase percentage must be calculated by the Department of
19.16Revenue so that the total of the aid under subdivision 9 equals the total amount available
19.17for aid under section 477A.03 after the subtraction under section 477A.014, subdivisions 4
19.18and 5 . For aids payable in 2009 only, a city's revenue need, population, net tax capacity,
19.19and tax effort rate will be based on the data available for calculating these factors for
19.20aids payable in 2008.
19.21EFFECTIVE DATE.This section is effective for aids payable in calendar year
19.222009 and thereafter.

19.23    Sec. 8. Minnesota Statutes 2006, section 477A.013, subdivision 9, as amended by
19.24Laws 2008, chapter 154, article 1, section 3, is amended to read:
19.25    Subd. 9. City aid distribution. (a) In calendar year 2009 and thereafter, each
19.26city shall receive an aid distribution equal to the sum of (1) the city formula aid under
19.27subdivision 8, and (2) its city aid base, and (3) one-half of the difference between its total
19.28aid in the previous year under this subdivision and its city aid base in the previous year.
19.29    (b) For aids payable in 2010 and thereafter, each city shall receive an aid distribution
19.30equal to (1) the city aid formula under subdivision 8, (2) its city aid base, and (3) its
19.31formula aid under subdivision 8 in the previous year, prior to any adjustments under
19.32this subdivision 2009 only, the total aid for any city shall not exceed the sum of (1) 40
19.33percent of the city's net levy for the year prior to the aid distribution, plus (2) its total
19.34aid in the previous year.
20.1    (c) For aids payable in 2009 2010 and thereafter, the total aid for any city shall
20.2not exceed the sum of (1) ten percent of the city's net levy for the year prior to the aid
20.3distribution plus (2) its total aid in the previous year. For aids payable in 2009 and
20.4thereafter, the total aid for any city with a population of 2,500 or more may not be less
20.5than its total aid under this section in the previous year minus the lesser of $15 multiplied
20.6by its population, or ten percent of its net levy in the year prior to the aid distribution.
20.7    (d) For aids payable in 2009 2010 and thereafter, the total aid for a city with a
20.8population less than 2,500 must not be less than the amount it was certified to receive in
20.9the previous year minus the lesser of $15 multiplied by its population, or five percent of its
20.102003 certified aid amount. For aids payable in 2009 only the total aid for a city with a
20.11population less than 2,500 must not be less than what it received under this section in the
20.12previous year unless its total aid in calendar year 2008 was aid under section 477A.011,
20.13subdivision 36, paragraph (s), in which case its minimum aid is zero.
20.14    (e) If a city's net tax capacity used in calculating aid under this section has decreased
20.15in any year by more than 25 percent from its net tax capacity in the previous year due to
20.16property becoming tax-exempt Indian land, the city's maximum allowed aid increase
20.17under paragraph (c) shall be increased by an amount equal to (1) the city's tax rate in the
20.18year of the aid calculation, multiplied by (2) the amount of its net tax capacity decrease
20.19resulting from the property becoming tax exempt.
20.20EFFECTIVE DATE.This section is effective for aids payable in calendar year
20.212009 and thereafter.

20.22    Sec. 9. Minnesota Statutes 2006, section 477A.03, is amended to read:
20.23477A.03 APPROPRIATION.
20.24    Subd. 2. Annual appropriation. A sum sufficient to discharge the duties imposed
20.25by sections 477A.011 to 477A.014 is annually appropriated from the general fund to the
20.26commissioner of revenue.
20.27    Subd. 2a. Cities. For aids payable in 2004 2009 and thereafter, the total aids aid paid
20.28under section 477A.013, subdivision 9, are limited to $429,000,000 is $534,148,487. For
20.29aids payable in 2005, the total aids paid under section 477A.013, subdivision 9, are limited
20.30to $437,052,000. For aids payable in 2006 and thereafter, the total aids paid under section
20.31477A.013, subdivision 9, is limited to $485,052,000 2009 only, an additional $1,000,000
20.32shall be retained by the commissioner and used to make payments under section 10.
20.33    Subd. 2b. Counties. (a) For aids payable in calendar year 2005 and thereafter,
20.34the total aids paid to counties under section 477A.0124, subdivision 3, are limited to
20.35$100,500,000. For aids payable in 2009 and thereafter, the total aid payable under section
21.1477A.0124, subdivision 3, is $110,500,000 minus one-half of the total aid amount
21.2determined under section 477A.0124, subdivision 5, paragraph (a). Each calendar year,
21.3$500,000 shall be retained by the commissioner of revenue to make reimbursements
21.4to the commissioner of finance for payments made under section 611.27. For calendar
21.5year 2004, the amount shall be in addition to the payments authorized under section
21.6477A.0124, subdivision 1 . For calendar year 2005 and subsequent years, the amount shall
21.7be deducted from the appropriation under this paragraph. The reimbursements shall be to
21.8defray the additional costs associated with court-ordered counsel under section 611.27.
21.9Any retained amounts not used for reimbursement in a year shall be included in the next
21.10distribution of county need aid that is certified to the county auditors for the purpose of
21.11property tax reduction for the next taxes payable year.
21.12    (b) For aids payable in 2005 2009 and thereafter, the total aids aid under section
21.13477A.0124, subdivision 4 , are limited to $105,000,000 is $115,132,923 minus one-half of
21.14the total aid amount determined under section 477A.0124, subdivision 5, paragraph (a).
21.15For aids payable in 2006 and thereafter, the total aid under section 477A.0124, subdivision
21.164 , is limited to $105,132,923. The commissioner of finance shall bill the commissioner of
21.17revenue for the cost of preparation of local impact notes as required by section 3.987, not
21.18to exceed $207,000 in fiscal year 2004 and thereafter. The commissioner of education
21.19shall bill the commissioner of revenue for the cost of preparation of local impact notes
21.20for school districts as required by section 3.987, not to exceed $7,000 in fiscal year 2004
21.21and thereafter. The commissioner of revenue shall deduct the amounts billed under
21.22this paragraph from the appropriation under this paragraph. The amounts deducted are
21.23appropriated to the commissioner of finance and the commissioner of education for the
21.24preparation of local impact notes.
21.25    Subd. 2c. Towns. For aids payable in 2009 and thereafter, the total aid under section
21.26477A.013, subdivision 1, is $3,000,000.
21.27EFFECTIVE DATE.This section is effective for aids payable in calendar year
21.282009 and thereafter.

21.29    Sec. 10. CITY FORECLOSURE GRANTS.
21.30    For calendar 2009 only, a city with a concentration of foreclosures within the city
21.31or within a zip code area of a city in calendar year 2007 may receive a grant under this
21.32section. A "concentration of foreclosures" means that the percent of housing in foreclosure
21.33within the area is at least 50 percent higher than the average percent of housing in
21.34foreclosure in the metropolitan area, as defined in Minnesota Statutes, section 473.121,
21.35subdivision 2. The city must apply to the commissioner of revenue by December 30, 2008,
22.1on the form prescribed by the commissioner. The grant will be paid with other aids paid in
22.2calendar year 2009, as prescribed in Minnesota Statutes, section 477A.015.
22.3    The commissioner of revenue shall consult with the commissioner of the Housing
22.4Finance Agency to develop a form for cities to use when applying for grants under this
22.5section and to determine whether applications qualify. The appropriation for the grants
22.6under Minnesota Statutes, section 477A.03, shall be divided between successful applicants
22.7based on the number of foreclosures in the area meeting the concentration criteria. No city
22.8may receive a grant of more than $250,000. All decisions by the commissioner regarding
22.9grant qualification and amount shall be final. The grant must be used to fund inspection
22.10and public safety costs associated with housing foreclosures.
22.11EFFECTIVE DATE.This section is effective for grants made in calendar year 2009.

22.12    Sec. 11. STUDY OF AIDS TO LOCAL GOVERNMENTS.
22.13    The chairs of the senate and house of representatives committees with jurisdiction
22.14over taxes shall each appoint five members to a study group of the tax committees to
22.15examine the current system of aids to local governments and make recommendations on
22.16improvements to the system. Of the five members appointed by each chair, two must be
22.17members of the tax committee, one of whom is a majority party member and one of
22.18whom is a minority party member. The remaining members must represent local units of
22.19government. The chairs of the divisions of the tax committees having jurisdiction over
22.20property taxes shall also be members and shall serve as cochairs of the study group.
22.21The study shall include, but not be limited to, consideration of existing disparities in
22.22the distribution of local government aid, the relationship of need for city aid to other
22.23sources of revenue such as local sales taxes, an analysis of current law need and capacity
22.24factors as well as alternative need factors, alternative analytical methods for determining
22.25correlations between factors and need, the formula used to calculate aid for small cities,
22.26and volatility in the local government aid distribution. The group must report on its
22.27specific recommendations to the legislature by December 15, 2010.
22.28EFFECTIVE DATE.This section is effective the day following final enactment.

22.29    Sec. 12. REPEALER.
22.30Minnesota Statutes 2006, section 477A.014, subdivision 5, and Minnesota Statutes
22.312007 Supplement, section 477A.014, subdivision 4, are repealed.
22.32EFFECTIVE DATE.This section is effective for aid payable in 2009 and thereafter.


23.3    Section 1. Minnesota Statutes 2006, section 270C.56, subdivision 3, is amended to read:
23.4    Subd. 3. Procedure for assessment. The commissioner may assess liability for the
23.5taxes described in subdivision 1 against a person liable under this section. The assessment
23.6may be based upon information available to the commissioner. It must be made within the
23.7prescribed period of limitations for assessing the underlying tax, or within one year after
23.8the date of an order assessing underlying tax, whichever period expires later. An order
23.9assessing personal liability under this section is reviewable under section 270C.35 and is
23.10appealable to Tax Court. If any portion of the liability shown on the order is paid after
23.11the time for appealing the order has expired, a claim for refund may be made, but only if
23.12filed within 120 days after the first payment of the liability.
23.13    If a person has been assessed under this section for an amount for a given period
23.14and the time for appeal has expired or there has been a final determination that the person
23.15is liable, collection action is not stayed pursuant to section 270C.33, subdivision 5, for
23.16subsequent assessments of additional amounts for the same person for the same period
23.17and tax type.
23.18EFFECTIVE DATE.This section is effective for orders issued on or after the
23.19day following final enactment.

23.20    Sec. 2. Minnesota Statutes 2006, section 289A.19, subdivision 2, is amended to read:
23.21    Subd. 2. Corporate franchise and mining company taxes. Corporations or mining
23.22companies shall receive an extension of seven months or the amount of time granted by
23.23the Internal Revenue Service, whichever is longer, for filing the return of a corporation
23.24subject to tax under chapter 290 or for filing the return of a mining company subject to
23.25tax under sections 298.01 and 298.015. Interest on any balance of tax not paid when the
23.26regularly required return is due must be paid at the rate specified in section 270C.40,
23.27from the date such payment should have been made if no extension was granted, until
23.28the date of payment of such tax.
23.29    If a corporation or mining company does not:
23.30    (1) pay at least 90 percent of the amount of tax shown on the return on or before the
23.31regular due date of the return, the penalty prescribed by section 289A.60, subdivision 1,
23.32shall be imposed on the unpaid balance of tax; or
23.33    (2) pay the balance due shown on the regularly required return on or before the
23.34extended due date of the return, the penalty prescribed by section 289A.60, subdivision 1,
23.35shall be imposed on the unpaid balance of tax from the original due date of the return.
24.1EFFECTIVE DATE.This section is effective the day following final enactment
24.2and applies to any federal extension that allows filing after that date.

24.3    Sec. 3. Minnesota Statutes 2006, section 289A.19, is amended by adding a subdivision
24.4to read:
24.5    Subd. 7. Federal extensions. When an extension of time to file a partnership or
24.6S corporation tax return is granted by the Internal Revenue Service, the commissioner
24.7shall grant an automatic extension to file the comparable Minnesota return for that period.
24.8An extension granted under this subdivision does not affect the due date for making
24.9payments of tax.
24.10EFFECTIVE DATE.This section is effective the day following final enactment
24.11and applies to any federal extension that allows filing after that date.

24.12    Sec. 4. Minnesota Statutes 2006, section 289A.40, subdivision 1, is amended to read:
24.13    Subdivision 1. Time limit; generally. Unless otherwise provided in this chapter,
24.14a claim for a refund of an overpayment of state tax must be filed within the latest of the
24.15following time periods that apply:
24.16    (1) 3-1/2 years from the date prescribed for filing the return, plus any extension of
24.17time granted for filing the return, but only if filed within the extended time,; or
24.18    (2) one year from the date of an order assessing tax under section 270C.33 or an
24.19order determining an appeal under section 270C.35, subdivision 8, or one year from the
24.20date of a return made by the commissioner under section 270C.33, subdivision 3, upon
24.21payment in full of the tax, penalties, and interest shown on the order or return made by
24.22the commissioner, whichever period expires later. Claims for refund, except for taxes
24.23under chapter 297A, filed after the 3-1/2 year period but within the one-year period are
24.24limited to the amount of the tax, penalties, and interest on the order or return made by the
24.25commissioner and to issues determined by the order or return made by the commissioner.
24.26In the case of assessments under section 289A.38, subdivision 5 or 6, claims for refund
24.27under chapter 297A filed after the 3-1/2 year period but within the one-year period are
24.28limited to the amount of the tax, penalties, and interest on the order or return made by the
24.29commissioner that are due for the period before the 3-1/2 year period.; or
24.30    (3) 120 days after the first payment of any portion of a tax liability shown on a
24.31return made by the commissioner under section 270C.33, subdivision 3, or shown on an
24.32order of assessment where no return has been filed under section 270C.33, subdivision
24.334, paragraph (a), clause (2). Claims for refund filed after the 3-1/2 year period and the
24.34one-year period but within the 120-day period are limited to the amount paid during the
25.1120-day period. This clause does not apply to returns or orders which have previously
25.2been the subject of a denied claim for refund or an administrative appeal.
25.3EFFECTIVE DATE.The right to file a claim for refund under this section is
25.4effective July 1, 2008. For claims filed before October 31, 2008, this section is effective
25.5retroactively to payments made after December 31, 2007.

25.6    Sec. 5. Minnesota Statutes 2006, section 290.01, subdivision 29, is amended to read:
25.7    Subd. 29. Taxable income. The term "taxable income" means:
25.8    (1) for individuals, estates, and trusts, the same as taxable net income;
25.9    (2) for corporations, the taxable net income less
25.10    (i) the net operating loss deduction under section 290.095;
25.11    (ii) the dividends received deduction under section 290.21, subdivision 4;
25.12    (iii) the exemption for operating in a job opportunity building zone under section
25.13469.317 ;
25.14    (iv) the exemption for operating in a biotechnology and health sciences industry
25.15zone under section 469.337; and
25.16    (v) the exemption for operating in an international economic development zone
25.17under section 469.326; plus
25.18    (vi) Minnesota development subsidies.
25.19EFFECTIVE DATE.This section is effective for taxable years beginning after
25.20December 31, 2008.

25.21    Sec. 6. Minnesota Statutes 2006, section 290.01, is amended by adding a subdivision
25.22to read:
25.23    Subd. 33. Minnesota development subsidies. (a) "Minnesota development
25.24subsidies" means the greater of the following amounts:
25.25    (1) one-half of the amount deducted by the taxpayer in computing federal taxable
25.26income for the taxable year, as property taxes, business expenses or otherwise, that is
25.27attributable to property taxes paid by the taxpayer, either directly or indirectly through a
25.28lease or otherwise, on property located in a tax increment financing district, as defined in
25.29section 469.174, or that receives an abatement under sections 469.1813 to 469.1815, if
25.30the owner of the property or a related party derives a benefit from the abatement by its
25.31property having access to or use of public improvements financed with the abatement or
25.32otherwise; or
25.33    (2) the amount of payments received by the taxpayer under a development or similar
25.34agreement that provides for payments or reimbursements from the proceeds of increments
26.1from a tax increment financing district or from an abatement under sections 469.1813 to
26.2469.1815, but excluding reimbursements under a development action response plan, as
26.3defined in section 469.174, subdivision 17, to pay for its costs incurred to fund removal
26.4or remedial actions.
26.5    (b) For purposes of this subdivision, "tax increment financing district" excludes:
26.6    (1) a housing district, as defined in section 469.174, subdivision 11;
26.7    (2) a soils condition district, as defined in section 469.174, subdivision 19; and
26.8    (3) a hazardous substance subdistrict, as defined in section 469.174, subdivision 23.
26.9EFFECTIVE DATE.This section is effective for taxable years beginning after
26.10December 31, 2008.

26.11    Sec. 7. Minnesota Statutes 2006, section 290.091, subdivision 2, as amended by Laws
26.122008, chapter 154, article 4, section 7, is amended to read:
26.13    Subd. 2. Definitions. For purposes of the tax imposed by this section, the following
26.14terms have the meanings given:
26.15    (a) "Alternative minimum taxable income" means the sum of the following for
26.16the taxable year:
26.17    (1) the taxpayer's federal alternative minimum taxable income as defined in section
26.1855(b)(2) of the Internal Revenue Code;
26.19    (2) the taxpayer's itemized deductions allowed in computing federal alternative
26.20minimum taxable income, but excluding:
26.21    (i) the charitable contribution deduction under section 170 of the Internal Revenue
26.22Code:;
26.23    (A) for taxable years beginning before January 1, 2006, to the extent that the
26.24deduction exceeds 1.0 percent of adjusted gross income;
26.25    (B) for taxable years beginning after December 31, 2005, to the full extent of the
26.26deduction.
26.27    For purposes of this clause, "adjusted gross income" has the meaning given in
26.28section 62 of the Internal Revenue Code;
26.29    (ii) the medical expense deduction;
26.30    (iii) the casualty, theft, and disaster loss deduction; and
26.31    (iv) the impairment-related work expenses of a disabled person;
26.32    (3) for depletion allowances computed under section 613A(c) of the Internal
26.33Revenue Code, with respect to each property (as defined in section 614 of the Internal
26.34Revenue Code), to the extent not included in federal alternative minimum taxable income,
26.35the excess of the deduction for depletion allowable under section 611 of the Internal
27.1Revenue Code for the taxable year over the adjusted basis of the property at the end of the
27.2taxable year (determined without regard to the depletion deduction for the taxable year);
27.3    (4) to the extent not included in federal alternative minimum taxable income, the
27.4amount of the tax preference for intangible drilling cost under section 57(a)(2) of the
27.5Internal Revenue Code determined without regard to subparagraph (E);
27.6    (5) to the extent not included in federal alternative minimum taxable income, the
27.7amount of interest income as provided by section 290.01, subdivision 19a, clause (1); and
27.8    (6) the amount of addition required by section 290.01, subdivision 19a, clauses
27.9(7) to (9), (11), and (12);
27.10    less the sum of the amounts determined under the following:
27.11    (1) interest income as defined in section 290.01, subdivision 19b, clause (1);
27.12    (2) an overpayment of state income tax as provided by section 290.01, subdivision
27.1319b , clause (2), to the extent included in federal alternative minimum taxable income;
27.14    (3) the amount of investment interest paid or accrued within the taxable year on
27.15indebtedness to the extent that the amount does not exceed net investment income, as
27.16defined in section 163(d)(4) of the Internal Revenue Code. Interest does not include
27.17amounts deducted in computing federal adjusted gross income; and
27.18    (4) amounts subtracted from federal taxable income as provided by section 290.01,
27.19subdivision 19b , clauses (6) and (9) to (16).
27.20    In the case of an estate or trust, alternative minimum taxable income must be
27.21computed as provided in section 59(c) of the Internal Revenue Code.
27.22    (b) "Investment interest" means investment interest as defined in section 163(d)(3)
27.23of the Internal Revenue Code.
27.24    (c) "Tentative minimum tax" equals 6.4 percent of alternative minimum taxable
27.25income after subtracting the exemption amount determined under subdivision 3.
27.26    (d) "Regular tax" means the tax that would be imposed under this chapter (without
27.27regard to this section and section 290.032), reduced by the sum of the nonrefundable
27.28credits allowed under this chapter.
27.29    (e) "Net minimum tax" means the minimum tax imposed by this section.
27.30EFFECTIVE DATE.This section is effective for taxable years beginning after
27.31December 31, 2007.

27.32    Sec. 8. Minnesota Statutes 2006, section 290.92, subdivision 1, is amended to read:
27.33    Subdivision 1. Definitions. (1) Wages. For purposes of this section, the term
27.34"wages" means the same as that term is defined in section 3401(a) and (f) of the Internal
28.1Revenue Code, except that provisions of section 530 of Public Law 95-600, as amended,
28.2do not apply.
28.3    (2) Payroll period. For purposes of this section the term "payroll period" means a
28.4period for which a payment of wages is ordinarily made to the employee by the employee's
28.5employer, and the term "miscellaneous payroll period" means a payroll period other
28.6than a daily, weekly, biweekly, semimonthly, monthly, quarterly, semiannual, or annual
28.7payroll period.
28.8    (3) Employee. For purposes of this section the term "employee" means any resident
28.9individual performing services for an employer, either within or without, or both within
28.10and without the state of Minnesota, and every nonresident individual performing services
28.11within the state of Minnesota, the performance of which services constitute, establish, and
28.12determine the relationship between the parties as that of employer and employee. As
28.13used in the preceding sentence, the term "employee" includes an officer of a corporation,
28.14and an officer, employee, or elected official of the United States, a state, or any political
28.15subdivision thereof, or the District of Columbia, or any agency or instrumentality of
28.16any one or more of the foregoing.
28.17    (4) Employer. For purposes of this section the term "employer" means any person,
28.18including individuals, fiduciaries, estates, trusts, partnerships, limited liability companies,
28.19and corporations transacting business in or deriving any income from sources within
28.20the state of Minnesota for whom an individual performs or performed any service, of
28.21whatever nature, as the employee of such person, except that if the person for whom the
28.22individual performs or performed the services does not have control of the payment of
28.23the wages for such services, the term "employer," except for purposes of paragraph (1),
28.24means the person having control of the payment of such wages. As used in the preceding
28.25sentence, the term "employer" includes any corporation, individual, estate, trust, or
28.26organization which is exempt from taxation under section 290.05 and further includes, but
28.27is not limited to, officers of corporations who have control, either individually or jointly
28.28with another or others, of the payment of the wages.
28.29    (5) Number of withholding exemptions claimed. For purposes of this section, the
28.30term "number of withholding exemptions claimed" means the number of withholding
28.31exemptions claimed in a withholding exemption certificate in effect under subdivision
28.325, except that if no such certificate is in effect, the number of withholding exemptions
28.33claimed shall be considered to be zero.
28.34EFFECTIVE DATE.This section is effective for wages paid after December 31,
28.352008.

29.1    Sec. 9. Minnesota Statutes 2006, section 291.03, subdivision 1, is amended to read:
29.2    Subdivision 1. Tax amount. The tax imposed shall be an amount equal to the
29.3proportion of the maximum credit for state death taxes computed under section 2011 of
29.4the Internal Revenue Code, as amended through December 31, 2000, but using Minnesota
29.5adjusted taxable estate instead of federal adjusted taxable estate, as the Minnesota gross
29.6estate bears to the value of the federal gross estate. The tax determined under this
29.7paragraph shall not be greater than the amount computed by applying the rates and
29.8brackets under section 2001(c) of the Internal Revenue Code to the sum of the Minnesota
29.9adjusted gross taxable estate and subtracting adjusted taxable gifts, as defined in section
29.102001(b) of the Internal Revenue Code, and then subtracting the federal credit allowed
29.11under section 2010 of the Internal Revenue Code of 1986, as amended through December
29.1231, 2000. For the purposes of this section, expenses which are deducted for federal income
29.13tax purposes under section 642(g) of the Internal Revenue Code as amended through
29.14December 31, 2002, are not allowable in computing the tax under this chapter.
29.15EFFECTIVE DATE.This section is effective retroactively as a clarification and
29.16applies to estates of decedents dying after December 31, 2005.

29.17    Sec. 10. REPEALER.
29.18Minnesota Statutes 2006, section 290.191, subdivision 4, is repealed.
29.19EFFECTIVE DATE.This section is effective for taxable years beginning after
29.20December 31, 2008.


29.23    Section 1. [116J.8732] SEED CAPITAL INVESTMENT CREDIT;
29.24COMMISSIONER'S RESPONSIBILITIES.
29.25    Subdivision 1. Scope. This section establishes rules that businesses must satisfy to
29.26qualify for the seed capital investment credit under section 290.06, subdivision 34, and the
29.27commissioner's responsibility for certifying the qualifying businesses.
29.28    Subd. 2. Definitions. (a) For purposes of this section and section 290.06,
29.29subdivision 34, the following terms have the meanings given.
29.30    (b) "Border city" means a city qualifying to designate a border city development
29.31zone under section 469.1731.
29.32    (c) "Pass-through entity" means a corporation that for the applicable tax year is
29.33treated as an S corporation or a general partnership, limited partnership, limited liability
30.1partnership, trust, or limited liability company and which for the applicable taxable year is
30.2not taxed as a corporation under chapter 290.
30.3    (d) "Primary sector business" means a qualified business that through the
30.4employment of knowledge or labor adds value to a product, process, or service and
30.5increases revenues to a Minnesota business generated by sales of products or services to
30.6customers outside of the state or increases revenues to a qualified business the customers
30.7of which previously were unable to acquire, or had limited availability of the product or
30.8service from a Minnesota provider.
30.9    (e) "Qualified business" means a business certified by the commissioner as meeting
30.10the requirements of subdivision 3.
30.11    Subd. 3. Qualified business. (a) The commissioner shall certify whether a business
30.12that has requested to become a qualified business meets the requirements of paragraph (b).
30.13    (b) For purposes of this section, a qualified business must be a primary sector
30.14business, other than a real estate investment trust, that:
30.15    (1) is incorporated or its satellite operation is incorporated as a for-profit corporation
30.16or is a partnership, limited partnership, limited liability company, limited liability
30.17partnership, or joint venture;
30.18    (2) is in compliance with the requirements for filings with the commissioner of
30.19commerce under the securities laws of this state;
30.20    (3) has Minnesota residents as a majority of its employees in its principal office or
30.21the satellite operation, which is located in a border city;
30.22    (4) has its principal office in a border city and has the majority of its business
30.23activity performed in a border city, except sales activity, or has a significant operation in
30.24a border city that has or is projected to have more than ten employees or $150,000 of
30.25sales annually; and
30.26    (5) relies on innovation, research, or the development of new products and processes
30.27in its plans for growth and profitability.
30.28    (c) The commissioner shall establish the necessary forms and procedures for
30.29certifying qualified businesses.
30.30    (d) A qualified business may apply to the commissioner for a recertification. Only
30.31one recertification is available to a qualified business. The application for recertification
30.32must be filed with the commissioner within 90 days before the original certification
30.33expiration date. The recertification issued by the director must comply with the provisions
30.34of paragraph (e).
30.35    (e) The commissioner shall issue a certification letter to a business the commissioner
30.36determines is a qualified business. The certification letter must include:
31.1    (1) the certification effective date; and
31.2    (2) the certification expiration date, which may not be more than four years from the
31.3certification effective date.
31.4    Subd. 4. Seed capital investment credit reporting. Within 30 days after the date
31.5that an investment in a qualified business is purchased, the qualified business shall file with
31.6the commissioner and the commissioner of revenue and provide to the investor completed
31.7forms prescribed by the commissioner of revenue that show as to each investment in the
31.8qualified business the following:
31.9    (1) the name, address, and Social Security number of the taxpayer who made the
31.10investment; and
31.11    (2) the dollar amount paid for the investment by the taxpayer.
31.12EFFECTIVE DATE.This section is effective the day following final enactment.

31.13    Sec. 2. Minnesota Statutes 2007 Supplement, section 268.19, subdivision 1, is
31.14amended to read:
31.15    Subdivision 1. Use of data. (a) Except as provided by this section, data gathered
31.16from any person under the administration of the Minnesota Unemployment Insurance Law
31.17are private data on individuals or nonpublic data not on individuals as defined in section
31.1813.02, subdivisions 9 and 12 , and may not be disclosed except according to a district court
31.19order or section 13.05. A subpoena is not considered a district court order. These data
31.20may be disseminated to and used by the following agencies without the consent of the
31.21subject of the data:
31.22    (1) state and federal agencies specifically authorized access to the data by state
31.23or federal law;
31.24    (2) any agency of any other state or any federal agency charged with the
31.25administration of an unemployment insurance program;
31.26    (3) any agency responsible for the maintenance of a system of public employment
31.27offices for the purpose of assisting individuals in obtaining employment;
31.28    (4) the public authority responsible for child support in Minnesota or any other
31.29state in accordance with section 256.978;
31.30    (5) human rights agencies within Minnesota that have enforcement powers;
31.31    (6) the Department of Revenue to the extent necessary for its duties under Minnesota
31.32laws;
31.33    (7) public and private agencies responsible for administering publicly financed
31.34assistance programs for the purpose of monitoring the eligibility of the program's
31.35recipients;
32.1    (8) the Department of Labor and Industry and the Division of Insurance Fraud
32.2Prevention in the Department of Commerce for uses consistent with the administration of
32.3their duties under Minnesota law;
32.4    (9) local and state welfare agencies for monitoring the eligibility of the data subject
32.5for assistance programs, or for any employment or training program administered by those
32.6agencies, whether alone, in combination with another welfare agency, or in conjunction
32.7with the department or to monitor and evaluate the statewide Minnesota family investment
32.8program by providing data on recipients and former recipients of food stamps or food
32.9support, cash assistance under chapter 256, 256D, 256J, or 256K, child care assistance
32.10under chapter 119B, or medical programs under chapter 256B, 256D, or 256L;
32.11    (10) local and state welfare agencies for the purpose of identifying employment,
32.12wages, and other information to assist in the collection of an overpayment debt in an
32.13assistance program;
32.14    (11) local, state, and federal law enforcement agencies for the purpose of ascertaining
32.15the last known address and employment location of an individual who is the subject of
32.16a criminal investigation;
32.17    (12) the United States Citizenship and Immigration Services has access to data on
32.18specific individuals and specific employers provided the specific individual or specific
32.19employer is the subject of an investigation by that agency;
32.20    (13) the Department of Health for the purposes of epidemiologic investigations; and
32.21    (14) the Department of Corrections for the purpose of postconfinement employment
32.22tracking of individuals who had been committed to the custody of the commissioner
32.23of corrections.; and
32.24    (15) the state auditor to the extent necessary to conduct audits of job opportunity
32.25building zones as required under section 469.3201.
32.26    (b) Data on individuals and employers that are collected, maintained, or used by
32.27the department in an investigation under section 268.182 are confidential as to data
32.28on individuals and protected nonpublic data not on individuals as defined in section
32.2913.02, subdivisions 3 and 13 , and must not be disclosed except under statute or district
32.30court order or to a party named in a criminal proceeding, administrative or judicial, for
32.31preparation of a defense.
32.32    (c) Data gathered by the department in the administration of the Minnesota
32.33unemployment insurance program must not be made the subject or the basis for any
32.34suit in any civil proceedings, administrative or judicial, unless the action is initiated by
32.35the department.
32.36EFFECTIVE DATE.This section is effective the day following final enactment.

33.1    Sec. 3. Minnesota Statutes 2006, section 270B.15, is amended to read:
33.2270B.15 DISCLOSURE TO LEGISLATIVE AUDITOR AND STATE
33.3AUDITOR.
33.4    (a) Returns and return information must be disclosed to the legislative auditor to the
33.5extent necessary for the legislative auditor to carry out sections 3.97 to 3.979.
33.6    (b) The commissioner must disclose return information, including the report
33.7required under section 289A.12, subdivision 15, to the state auditor to the extent necessary
33.8to conduct audits of job opportunity building zones as required under section 469.3201.
33.9EFFECTIVE DATE.This section is effective the day following final enactment.

33.10    Sec. 4. Minnesota Statutes 2006, section 289A.12, is amended by adding a subdivision
33.11to read:
33.12    Subd. 15. Report of job opportunity zone benefits; penalty for failure to file
33.13report. (a) By October 15 of each year, every qualified business, as defined under section
33.14469.310, subdivision 11, must file with the commissioner, on a form prescribed by the
33.15commissioner, a report listing the tax benefits under section 469.315 received by the
33.16business for the previous year.
33.17    (b) The commissioner shall send notice to each business that fails to timely submit
33.18the report required under paragraph (a). The notice shall demand that the business submit
33.19the report within 60 days. Where good cause exists, the commissioner may extend
33.20the period for submitting the report as long as a request for extension is filed by the
33.21business before the expiration of the 60-day period. The commissioner shall notify the
33.22commissioner of the Department of Employment and Economic Development and the
33.23appropriate job opportunity subzone administrator whenever notice is sent to a business
33.24under this paragraph.
33.25    (c) A business that fails to submit the report as required under paragraph (b) is no
33.26longer a qualified business under section 469.310, subdivision 11, and is subject to the
33.27repayment provisions of section 469.319.
33.28EFFECTIVE DATE.This section is effective beginning with reports required to be
33.29filed October 15, 2008.

33.30    Sec. 5. Minnesota Statutes 2006, section 290.06, is amended by adding a subdivision
33.31to read:
33.32    Subd. 34. Seed capital investment credit. (a) An individual, estate, or trust is
33.33allowed a credit against the tax imposed by this chapter for investments in a qualifying
33.34business certified under section 116J.8732, subdivision 3. The credit equals 45 percent
34.1of the amount invested by the taxpayer in qualified businesses during the taxable year.
34.2The credit must not exceed $112,500 for each taxable year.
34.3    (b) A pass-through entity that invests in a qualified business must be considered to
34.4be the taxpayer for purposes of the investment limitations in this subdivision and the
34.5amount of the credit allowed with respect to a pass-through entity's investment in a
34.6qualified business must be determined at the pass-through entity level. The amount of the
34.7total credit determined at the pass-through entity level must be allowed to the members in
34.8proportion to their respective interests in the pass-through entity.
34.9    (c) An investment made in a qualified business from the assets of a retirement
34.10plan is deemed to be the retirement plan participant's investment for the purpose of this
34.11subdivision if a separate account is maintained for the plan participant and the participant
34.12directly controls where the account assets are invested.
34.13    (d) The investment must be made on or after the certification effective date and
34.14must be at risk in the business to be eligible for the tax credit under this subdivision.
34.15An investment for which a credit is received under this subdivision must remain in the
34.16qualified business for at least three years. Investments placed in escrow do not qualify
34.17for the credit.
34.18    (e) The entire amount of an investment for which a credit is claimed under this
34.19subdivision must be expended by the qualified business for plant, equipment, research and
34.20development, marketing and sales activity, or working capital for the qualified business.
34.21    (f) A taxpayer who owns a controlling interest in the qualified business or who
34.22receives more than 50 percent of the taxpayer's gross annual income from the qualified
34.23business is not entitled to a credit under this subdivision. A member of the immediate
34.24family of a taxpayer disqualified by this subdivision is not entitled to the credit under this
34.25subdivision. For purposes of this subdivision, "immediate family" means the taxpayer's
34.26spouse, parent, sibling, or child or the spouse of any such person.
34.27    (g) The commissioner may disallow any credit otherwise allowed under this
34.28subdivision if any representation by a business in the application for certification as a
34.29qualified business proves to be false or if the taxpayer or qualified business fails to satisfy
34.30any conditions under this subdivision or section 116J.8732 or any conditions consistent
34.31with those requirements otherwise determined by the commissioner. The commissioner
34.32has four years after the due date of the return or after the return was filed, whichever
34.33period expires later, to audit the credit and assess additional tax that may be found due
34.34to failure to comply with the provisions of this subdivision and section 116J.8732. The
34.35amount of any credit disallowed by the commissioner that reduced the taxpayer's income
35.1tax liability for any or all applicable tax years, plus penalty and interest as provided under
35.2chapter 289A, must be paid by the taxpayer.
35.3    (h) If the amount of the credit under this subdivision for any taxable year exceeds
35.4the limitations under paragraph (a), the excess is a credit carryover to each of the four
35.5succeeding taxable years. The entire amount of the excess unused credit for the taxable
35.6year must be carried first to the earliest of the taxable years to which the credit may be
35.7carried. The amount of the unused credit that may be added under this paragraph may
35.8not exceed the taxpayer's liability for tax, less the credit for the taxable year. Each year,
35.9the aggregate amount of seed capital investment tax credit allowed for investments under
35.10this subdivision is limited to allocations that a border city has available for tax reductions
35.11in border city enterprise zones under section 469.170. The city must annually notify the
35.12commissioner of the amount of its section 469.170 allocations that it wishes to use to
35.13provide credits under this paragraph and the commissioner, after verifying the available
35.14allocation, shall implement the limit under this paragraph. If investments in qualified
35.15businesses reported to the commissioner exceed the limit on credits for investments
35.16imposed by this subdivision, the credit must be allowed to taxpayers in the chronological
35.17order of their investments in qualified businesses as determined from the forms filed
35.18under section 116J.8732.
35.19EFFECTIVE DATE.This section is effective July 1, 2008, for taxable years
35.20beginning after December 31, 2007, and only applies to investments made after the
35.21qualified business has been certified by the commissioner of employment and economic
35.22development.

35.23    Sec. 6. Minnesota Statutes 2006, section 383E.20, is amended to read:
35.24383E.20 BONDING FOR COUNTY LIBRARY BUILDINGS.
35.25    The Anoka County Board may, by resolution adopted by a four-sevenths vote,
35.26issue and sell general obligation bonds of the county in the manner provided in chapter
35.27475 to acquire, better, and construct county library buildings. The bonds shall not be
35.28subject to the requirements of sections 475.57 to 475.59. The maturity years and amounts
35.29and interest rates of each series of bonds shall be fixed so that the maximum amount of
35.30principal and interest to become due in any year, on the bonds of that series and of all
35.31outstanding series issued by or for the purposes of libraries, shall not exceed an amount
35.32equal to the lesser of (i) .01 percent of the taxable market value of all taxable property in
35.33the county, excluding any taxable property taxed by any city for the support of any free
35.34public library, or (ii) $1,250,000. When the tax levy authorized in this section is collected,
35.35it shall be appropriated and credited to a debt service fund for the bonds. The tax levy for
36.1the debt service fund under section 475.61 shall be reduced by the amount available or
36.2reasonably anticipated to be available in the fund to make payments otherwise payable
36.3from the levy pursuant to section 475.61.
36.4EFFECTIVE DATE.This section is effective the day after the governing body
36.5of Anoka County and its chief clerical officer timely complete their compliance with
36.6Minnesota Statutes, section 645.021, subdivisions 2 and 3.

36.7    Sec. 7. Minnesota Statutes 2006, section 469.033, subdivision 6, is amended to read:
36.8    Subd. 6. Operation area as taxing district, special tax. All of the territory
36.9included within the area of operation of any authority shall constitute a taxing district for
36.10the purpose of levying and collecting special benefit taxes as provided in this subdivision.
36.11All of the taxable property, both real and personal, within that taxing district shall be
36.12deemed to be benefited by projects to the extent of the special taxes levied under this
36.13subdivision. Subject to the consent by resolution of the governing body of the city in and
36.14for which it was created, an authority may levy a tax upon all taxable property within that
36.15taxing district. The tax shall be extended, spread, and included with and as a part of
36.16the general taxes for state, county, and municipal purposes by the county auditor, to be
36.17collected and enforced therewith, together with the penalty, interest, and costs. As the tax,
36.18including any penalties, interest, and costs, is collected by the county treasurer it shall be
36.19accumulated and kept in a separate fund to be known as the "housing and redevelopment
36.20project fund." The money in the fund shall be turned over to the authority at the same time
36.21and in the same manner that the tax collections for the city are turned over to the city, and
36.22shall be expended only for the purposes of sections 469.001 to 469.047. It shall be paid
36.23out upon vouchers signed by the chair of the authority or an authorized representative.
36.24The amount of the levy shall be an amount approved by the governing body of the city, but
36.25shall not exceed 0.0144 0.02 percent of taxable market value for the current levy year,
36.26notwithstanding section 273.032. The authority shall each year formulate and file a budget
36.27in accordance with the budget procedure of the city in the same manner as required of
36.28executive departments of the city or, if no budgets are required to be filed, by August 1.
36.29The amount of the tax levy for the following year shall be based on that budget.
36.30EFFECTIVE DATE.This section is effective for property taxes payable in 2009.

36.31    Sec. 8. Minnesota Statutes 2006, section 469.177, is amended by adding a subdivision
36.32to read:
36.33    Subd. 13. Correction of errors. (a) If the county auditor, as a result of an error
36.34or mistake, decertifies a district, fails to certify a district, incorrectly certifies a district,
37.1or otherwise fails to correctly compute the amount of increment, the county auditor may
37.2undertake one or more of the following actions to correct the error or mistake:
37.3    (1) certify the original tax capacity of the affected parcels at the appropriate value
37.4for a later taxes payable year and extend the duration of the district, in whole or in part,
37.5to compensate;
37.6    (2) recertify the affected parcels and extend duration of the district, in whole or in
37.7part, to compensate;
37.8    (3) recertify or correct the original tax capacity rate for the district; or
37.9    (4) take other appropriate action so that the amount of increment compensates for or
37.10offsets the error or mistake and correctly reflects application of the law.
37.11    (b) At least 30 days before exercising authority under this subdivision, the county
37.12auditor must notify the authority and the municipality, in writing, of the intent to do so,
37.13including supporting information to describe reason for the proposed action. The authority
37.14and municipality may waive the time requirement of this paragraph. If the city or the
37.15authority objects before expiration of the 30-day period, the matter must be submitted to
37.16the commissioner of revenue for a decision or resolution of the dispute. The commissioner
37.17of revenue shall consult with the Office of the State Auditor before making a decision.
37.18    (c) The county auditor must notify the commissioner of revenue and the Office
37.19of the State Auditor of corrections made under this subdivision. The notification must
37.20be made in the form and manner and at the time prescribed by the commissioner. The
37.21commissioner shall incorporate the corrections in the tax increment financing district tax
37.22list supplement, as appropriate.
37.23EFFECTIVE DATE.This section is effective the day following final enactment
37.24and applies to all tax increment financing districts, regardless of when the request for
37.25certification was made.

37.26    Sec. 9. Minnesota Statutes 2006, section 469.312, is amended by adding a subdivision
37.27to read:
37.28    Subd. 6. Termination of designation of qualified business. No person will be
37.29deemed to be a qualified business eligible for the benefits provided in sections 469.310
37.30to 469.320 unless the person has entered into a business subsidy agreement with a local
37.31government unit as provided in section 469.310, subdivision 11, prior to June 1, 2008.

37.32    Sec. 10. Minnesota Statutes 2006, section 469.319, is amended to read:
37.33469.319 REPAYMENT OF TAX BENEFITS BY BUSINESSES THAT NO
37.34LONGER OPERATE IN A ZONE.
38.1    Subdivision 1. Repayment obligation. A business must repay the amount of the
38.2total tax reduction benefits listed in section 469.315 and any refund under section 469.318
38.3in excess of tax liability, received during the two years immediately before it (1) ceased to
38.4operate in the zone, if the business:
38.5    (1) received tax reductions authorized by section 469.315; and
38.6    (2)(i) did not meet the goals specified in an agreement entered into with the applicant
38.7that states any obligation the qualified business must fulfill in order to be eligible for tax
38.8benefits. The commissioner of employment and economic development may extend for
38.9up to one year the period for meeting any goals provided in an agreement. The applicant
38.10may extend the period for meeting other goals by documenting in writing the reason
38.11for the extension and attaching a copy of the document to its next annual report to the
38.12commissioner of employment and economic development; or
38.13    (ii) ceased to operate its facility located within the job opportunity building zone
38.14perform a substantial level of activities described in the business subsidy agreement, or
38.15(2) otherwise ceases ceased to be or is not a qualified business, other than those subject to
38.16the provisions of section 469.3191.
38.17    Subd. 1a. Repayment obligation of businesses not operating in zone. Persons
38.18that receive benefits without operating a business in a zone are subject to repayment
38.19under this section if the business for which those benefits relate is subject to repayment
38.20under this section. Such persons are deemed to have ceased performing in the zone on
38.21the same day that the qualified business for which the benefits relate becomes subject to
38.22repayment under subdivision 1.
38.23    Subd. 2. Definitions. (a) For purposes of this section, the following terms have
38.24the meanings given.
38.25    (b) "Business" means any person who that received tax benefits enumerated in
38.26section 469.315.
38.27    (c) "Commissioner" means the commissioner of revenue.
38.28    (d) "Persons that receive benefits without operating a business in a zone" means
38.29persons that claim benefits under section 469.316, subdivision 2 or 4, as well as persons
38.30that own property leased by a qualified business and are eligible for benefits under section
38.31272.02, subdivision 64, or 297A.68, subdivision 37, paragraph (b).
38.32    Subd. 3. Disposition of repayment. The repayment must be paid to the state to
38.33the extent it represents a state tax reduction and to the county to the extent it represents a
38.34property tax reduction. Any amount repaid to the state must be deposited in the general
38.35fund. Any amount repaid to the county for the property tax exemption must be distributed
38.36to the local governments taxing authorities with authority to levy taxes in the zone in the
39.1same manner provided for distribution of payment of delinquent property taxes. Any
39.2repayment of local sales taxes must be repaid to the commissioner for distribution to the
39.3city or county imposing the local sales tax.
39.4    Subd. 4. Repayment procedures. (a) For the repayment of taxes imposed under
39.5chapter 290 or 297A or local taxes collected pursuant to section 297A.99, a business must
39.6file an amended return with the commissioner of revenue and pay any taxes required
39.7to be repaid within 30 days after ceasing to do business in the zone becoming subject
39.8to repayment under this section. The amount required to be repaid is determined by
39.9calculating the tax for the period or periods for which repayment is required without
39.10regard to the exemptions and credits allowed under section 469.315.
39.11    (b) For the repayment of taxes imposed under chapter 297B, a business must pay any
39.12taxes required to be repaid to the motor vehicle registrar, as agent for the commissioner
39.13of revenue, within 30 days after ceasing to do business in the zone becoming subject
39.14to repayment under this section.
39.15    (c) For the repayment of property taxes, the county auditor shall prepare a tax
39.16statement for the business, applying the applicable tax extension rates for each payable
39.17year and provide a copy to the business and to the taxpayer of record. The business must
39.18pay the taxes to the county treasurer within 30 days after receipt of the tax statement.
39.19The business or the taxpayer of record may appeal the valuation and determination of the
39.20property tax to the Tax Court within 30 days after receipt of the tax statement.
39.21    (d) The provisions of chapters 270C and 289A relating to the commissioner's
39.22authority to audit, assess, and collect the tax and to hear appeals are applicable to the
39.23repayment required under paragraphs (a) and (b). The commissioner may impose civil
39.24penalties as provided in chapter 289A, and the additional tax and penalties are subject to
39.25interest at the rate provided in section 270C.40, from 30 days after ceasing to do business
39.26in the job opportunity building zone becoming subject to repayment under this section
39.27until the date the tax is paid.
39.28    (e) If a property tax is not repaid under paragraph (c), the county treasurer shall add
39.29the amount required to be repaid to the property taxes assessed against the property for
39.30payment in the year following the year in which the treasurer discovers that the business
39.31ceased to operate in the job opportunity building zone auditor provided the statement
39.32under paragraph (c).
39.33    (f) For determining the tax required to be repaid, a tax reduction of a state or local
39.34sales or use tax is deemed to have been received on the date that the tax would have
39.35been due if the taxpayer had not been entitled to the exemption or on the date a refund
39.36was issued for a refundable tax credit. good or service was purchased or first put to a
40.1taxable use. In the case of an income tax or franchise tax, including the credit payable
40.2under section 469.318, a reduction of tax is deemed to have been received for the two
40.3most recent tax years that have ended prior to the date that the business became subject to
40.4repayment under this section. In the case of a property tax, a reduction of tax is deemed to
40.5have been received for the taxes payable in the year that the business became subject to
40.6repayment under this section and for the taxes payable in the prior year.
40.7    (g) The commissioner may assess the repayment of taxes under paragraph (d)
40.8any time within two years after the business ceases to operate in the job opportunity
40.9building zone becomes subject to repayment under subdivision 1, or within any period of
40.10limitations for the assessment of tax under section 289A.38, whichever period is later. The
40.11county auditor may send the statement under paragraph (c) any time within three years
40.12after the business becomes subject to repayment under subdivision 1.
40.13    (h) A business is not entitled to any income tax or franchise tax benefits, including
40.14refundable credits, for any part of the year in which the business becomes subject to
40.15repayment under this section nor for any year thereafter. Property is not exempt from tax
40.16under section 272.02, subdivision 64, for any taxes payable in the year following the year
40.17in which the property became subject to repayment under this section nor for any year
40.18thereafter. A business is not eligible for any sales tax benefits beginning with goods
40.19or services purchased or first put to a taxable use on the day that the business becomes
40.20subject to repayment under this section.
40.21    Subd. 5. Waiver authority. (a) The commissioner may waive all or part of a
40.22repayment required under subdivision 1, if the commissioner, in consultation with
40.23the commissioner of employment and economic development and appropriate officials
40.24from the local government units in which the qualified business is located, determines
40.25that requiring repayment of the tax is not in the best interest of the state or the local
40.26government units and the business ceased operating as a result of circumstances beyond
40.27its control including, but not limited to:
40.28    (1) a natural disaster;
40.29    (2) unforeseen industry trends; or
40.30    (3) loss of a major supplier or customer.
40.31    (b)(1) The commissioner shall waive repayment required under subdivision 1a if
40.32the commissioner has waived repayment by the operating business under subdivision 1,
40.33unless the person that received benefits without having to operate a business in the zone
40.34was a contributing factor in the qualified business becoming subject to repayment under
40.35subdivision 1;
41.1    (2) the commissioner shall waive the repayment required under subdivision 1a, even
41.2if the repayment has not been waived for the operating business if:
41.3    (i) the person that received benefits without having to operate a business in the zone
41.4and the business that operated in the zone are not related parties as defined in section
41.5267(b) of the Internal Revenue Code of 1986, as amended through December 31, 2007; and
41.6    (ii) actions of the person were not a contributing factor in the qualified business
41.7becoming subject to repayment under subdivision 1.
41.8    Subd. 6. Reconciliation. Where this section is inconsistent with section 116J.994,
41.9subdivision 3 , paragraph (e), or 6, or any other provisions of sections 116J.993 to
41.10116J.995 , this section prevails.
41.11EFFECTIVE DATE.The amendment to subdivision 4, paragraph (c), of this
41.12section is effective the day following final enactment. The amendment to subdivision
41.134, paragraph (f), is effective retroactively from January 1, 2008, and applies to all
41.14businesses that become subject to this section in 2008. The rest of this section is effective
41.15retroactively from January 1, 2004, except that for violations that occur before the day
41.16following final enactment, this section does not apply if the business has repaid the
41.17benefits or the commissioner has granted a waiver.

41.18    Sec. 11. [469.3191] BREACH OF AGREEMENTS BY BUSINESSES THAT
41.19CONTINUE TO OPERATE IN ZONE.
41.20    (a) A "business in violation of its business subsidy agreement but not subject to
41.21section 469.319" means a business that is operating in violation of the business subsidy
41.22agreement but maintains a level of operations in the zone that does not subject it to the
41.23repayment provisions of section 469.319, subdivision 1, clause (1).
41.24    (b) A business described in paragraph (a) that does not sign a new or amended
41.25business subsidy agreement, as authorized under paragraph (h), is subject to repayment
41.26of benefits under section 469.319 from the day that it ceases to perform in the zone a
41.27substantial level of activities described in the business subsidy agreement.
41.28    (c) A business described in paragraph (a) ceases being a qualified business after the
41.29last day that it has to meet the goals stated in the agreement.
41.30    (d) A business is not entitled to any income tax or franchise tax benefits, including
41.31refundable credits, for any part of the year in which the business is no longer a qualified
41.32business under paragraph (c), and thereafter. A business is not eligible for sales tax
41.33benefits beginning with goods or services purchased or put to a taxable use on the day that
41.34it is no longer a qualified business under paragraph (c). Property is not exempt from tax
42.1under section 272.02, subdivision 64, for any taxes payable in the year following the year
42.2in which the business is no longer a qualified business under paragraph (c), and thereafter.
42.3    (e) A business described in paragraph (a) that wants to resume eligibility for benefits
42.4under section 469.315 must request that the commissioner of employment and economic
42.5development determine the length of time that the business is ineligible for benefits. The
42.6commissioner shall determine the length of ineligibility by applying the proportionate
42.7level of performance under the agreement to the total duration of the zone as measured
42.8from the date that the business subsidy agreement was executed. The length of time
42.9must not be less than one full year for each tax benefit listed in section 469.315. The
42.10commissioner of employment and economic development and the appropriate local
42.11government officials shall consult with the commissioner of revenue to ensure that the
42.12period of ineligibility includes at least one full year of benefits for each tax.
42.13    (f) The length of ineligibility determined under paragraph (e) must be applied by
42.14reducing the zone duration for the property by the duration of the ineligibility.
42.15    (g) The zone duration of property that has been adjusted under paragraph (f) must
42.16not be altered again to permit the business additional benefits under section 469.315.
42.17    (h) A business described in paragraph (a) becomes eligible for benefits available
42.18under section 469.315 by entering into a new or amended business subsidy agreement
42.19with the appropriate local government unit. The new or amended agreement must cover
42.20a period beginning from the date of ineligibility under the original business subsidy
42.21agreement, through the zone duration determined by the commissioner under paragraph
42.22(f). No exemption of property taxes under section 272.02, subdivision 64, is available
42.23under the new or amended agreement for property taxes due or paid before the date of
42.24the final execution of the new or amended agreement, but unpaid taxes due after that
42.25date need not be paid.
42.26    (i) A business that violates the terms of an agreement authorized under paragraph
42.27(h) is permanently barred from seeking benefits under section 469.315 and is subject to
42.28the repayment provisions under section 469.319 effective from the day that the business
42.29ceases to operate as a qualified business in the zone under the second agreement.
42.30EFFECTIVE DATE.This section is effective retroactively from January 1, 2004.
42.31For violations that occur before the day following final enactment, this section does not
42.32apply if the business has repaid the benefits or the commissioner has granted a waiver.

42.33    Sec. 12. [469.3192] PROHIBITION AGAINST AMENDMENTS TO BUSINESS
42.34SUBSIDY AGREEMENT.
43.1    Except as authorized under section 469.3191, under no circumstance shall terms
43.2of any agreement required as a condition for eligibility for benefits listed under section
43.3469.315 be amended to change job creation, job retention, or wage goals included in
43.4the agreement.
43.5EFFECTIVE DATE.This section is effective the day following final enactment
43.6and applies to all agreements executed before, on, or after the effective date.

43.7    Sec. 13. [469.3193] CERTIFICATION OF CONTINUING ELIGIBILITY FOR
43.8JOBZ BENEFITS.
43.9    (a) By December 1 of each year, every qualified business must certify to the
43.10commissioner of revenue, on a form prescribed by the commissioner of revenue, whether
43.11it is in compliance with any agreement required as a condition for eligibility for benefits
43.12listed under section 469.315. A business that fails to submit the certification, or any
43.13business, including those still operating in the zone, that submits a certification that
43.14the commissioner of revenue later determines materially misrepresents the business's
43.15compliance with the agreement, is subject to the repayment provisions under section
43.16469.319 from January 1 of the year in which the report is due or the date that the business
43.17became subject to section 469.319, whichever is earlier. Any such business is permanently
43.18barred from obtaining benefits under section 469.315. For purposes of this section, the bar
43.19applies to an entity and also applies to any individuals or entities that have an ownership
43.20interest of at least 20 percent of the entity.
43.21    (b) Before the sanctions under paragraph (a) apply to a business that fails to
43.22submit the certification, the commissioner of revenue shall send notice to the business,
43.23demanding that the certification be submitted within 30 days and advising the business
43.24of the consequences for failing to do so. The commissioner of revenue shall notify
43.25the commissioner of employment and economic development and the appropriate job
43.26opportunity subzone administrator whenever notice is sent to a business under this
43.27paragraph.
43.28    (c) The certification required under this section is public.
43.29    (d) The commissioner of revenue shall promptly notify the commissioner of
43.30employment and economic development of all businesses that certify that they are not
43.31in compliance with the terms of their business subsidy agreement and all businesses
43.32that fail to file the certification.
43.33EFFECTIVE DATE.This section is effective the day following final enactment.

43.34    Sec. 14. Minnesota Statutes 2006, section 469.3201, is amended to read:
44.1469.3201 JOBZ EXPENDITURE LIMITATIONS; AUDITS STATE
44.2AUDITOR; AUDITS OF JOB OPPORTUNITY BUILDING ZONES AND
44.3BUSINESS SUBSIDY AGREEMENTS.
44.4    The Tax Increment Financing, Investment and Finance Division of the Office of the
44.5State Auditor must annually audit the creation and operation of all job opportunity building
44.6zones and business subsidy agreements entered into under Minnesota Statutes, sections
44.7469.310 to 469.320. To the extent necessary to perform this audit, the state auditor may
44.8request from the commissioner of revenue tax return information of taxpayers who are
44.9eligible to receive tax benefits authorized under section 469.315. To the extent necessary
44.10to perform this audit, the state auditor may request from the commissioner of employment
44.11and economic development wage detail report information required under section 268.044
44.12of taxpayers eligible to receive tax benefits authorized under section 469.315.
44.13EFFECTIVE DATE.This section is effective the day following final enactment.

44.14    Sec. 15. Minnesota Statutes 2006, section 473.39, is amended by adding a subdivision
44.15to read:
44.16    Subd. 1n. Obligations. After July 1, 2008, in addition to other authority in this
44.17section, the council may issue certificates of indebtedness, bonds, or other obligations
44.18under this section in an amount not exceeding $33,000,000 for capital expenditures as
44.19prescribed in the council's regional transit master plan and transit capital improvement
44.20program and for related costs, including the costs of issuance and sale of the obligations.
44.21EFFECTIVE DATE.This section is effective July 1, 2008, and applies in the
44.22counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington.

44.23    Sec. 16. Laws 1995, chapter 264, article 5, section 46, subdivision 2, is amended to
44.24read:
44.25    Subd. 2. Limitation on use of tax increments. (a) All revenues derived from tax
44.26increments must be used in accordance with the housing replacement district plan. The
44.27revenues must be used solely to pay the costs of site acquisition, relocation, demolition
44.28of existing structures, site preparation, and pollution abatement on parcels identified in
44.29the housing replacement district plan, as well as public improvements and administrative
44.30costs directly related to those parcels.
44.31    (b) Notwithstanding paragraph (a), the city of Minneapolis may use revenues
44.32derived from tax increments from its housing replacement district for activities related
44.33to parcels not identified in the housing replacement plan, but which would qualify for
44.34inclusion under section 45, subdivision 1, paragraph (b), clauses (1) to (3).
45.1    (c) Notwithstanding paragraph (a), or any other provisions of sections 44 to 47, the
45.2Crystal Economic Development Authority may use revenues derived from tax increments
45.3from its housing replacement districts numbers one and two as if those districts were
45.4housing districts under Minnesota Statutes, section 469.174, subdivision 11, provided that
45.5eligible activities may be located anywhere in the city without regard to the boundaries of
45.6housing replacement district numbers one and two or any project area.
45.7EFFECTIVE DATE.This section applies to revenues from the housing replacement
45.8districts, regardless of when they were received, and is effective the day following final
45.9enactment and for the city of Minneapolis, upon compliance by the governing body of
45.10the city of Minneapolis with Minnesota Statutes, section 645.021, subdivision 3, and, for
45.11the city of Crystal, upon compliance by the governing body of the city of Crystal with
45.12Minnesota Statutes, section 645.021, subdivision 3.

45.13    Sec. 17. Laws 2003, chapter 127, article 10, section 31, subdivision 1, is amended to
45.14read:
45.15    Subdivision 1. District extension. (a) The governing body of the city of Hopkins
45.16may elect to extend the duration of its redevelopment tax increment financing district
45.172-11 by up to four additional years.
45.18    (b) Notwithstanding any law to the contrary, effective upon approval of this
45.19subdivision, no increments may be spent on activities located outside of the area of the
45.20district, other than to pay administrative expenses.
45.21EFFECTIVE DATE.This section is effective the day following final enactment.

45.22    Sec. 18. Laws 2006, chapter 259, article 10, section 14, subdivision 1, is amended to
45.23read:
45.24    Subdivision 1. Definitions. (a) "City" means the city of Minneapolis.
45.25    (b) "Homeless assistance tax increment district" means a contiguous area of the
45.26city that:
45.27    (1) is no larger than six eight acres;
45.28    (2) is located within the boundaries of a city municipal development district; and
45.29    (3) contains at least two shelters for homeless persons that have been owned or
45.30operated by nonprofit corporations that (i) are qualified charitable organizations under
45.31section 501(c)(3) of the United States Internal Revenue Code, (ii) have operated such
45.32homeless facilities within the district for at least five years, and (iii) have been recipients
45.33of emergency services grants under Minnesota Statutes, section 256E.36.
46.1EFFECTIVE DATE.This section is effective upon compliance by the city of
46.2Minneapolis with Minnesota Statutes, section 645.021.

46.3    Sec. 19. Laws 2008, chapter 154, article 9, section 23, is amended to read:
46.4    Sec. 23. CITY OF FRIDLEY; TAX INCREMENT FINANCING DISTRICT;
46.5SPECIAL RULES.
46.6    (a) If the city elects upon the adoption of a tax increment financing plan for a district,
46.7the rules under this section apply to a redevelopment tax increment financing district
46.8established by the city of Fridley or the housing and redevelopment authority of the city.
46.9The redevelopment tax increment district includes the following parcels and adjacent
46.10railroad property and shall be referred to as the Northstar Transit Station District: parcel
46.11numbers 223024120010, 223024120009, 223024120017, 223024120016, 223024120018,
46.12223024120012, 223024120011, 223024120005, 223024120004, 223024120003,
46.13223024120013, 223024120008, 223024120007, 223024120006, 223024130005,
46.14223024130010, 223024130011, 223024130003, 153024440039, 153024440037,
46.15153024440041, 153024440042, 223024110013, 223024110016, 223024110017,
46.16223024140008, 223024130002, 223024420004, 223024410002, 223024410003,
46.17223024110008, 223024110007, 223024110019, 223024110018, 223024110003,
46.18223024140003, 223024140009, 223024140002, 223024140010, and 223024410007.
46.19    (b) The requirements for qualifying a redevelopment tax increment district under
46.20Minnesota Statutes, section 469.174, subdivision 10, do not apply to the parcels located
46.21within the Northstar Transit Station District, which are deemed eligible for inclusion
46.22in a redevelopment tax increment district.
46.23    (c) In addition to the costs permitted by Minnesota Statutes, section 469.176,
46.24subdivision 4j , eligible expenditures within the Northstar Transit Station District include
46.25those costs necessary to provide for the construction and land acquisition for a tunnel
46.26under the Burlington Northern Santa Fe railroad tracks to allow access to the Northstar
46.27Commuter Rail.
46.28    (d) Notwithstanding the provisions of Minnesota Statutes, section 469.1763,
46.29subdivision 2 , the city of Fridley may expend increments generated from its tax increment
46.30financing districts Nos. 11, 12, and 13 for costs permitted by paragraph (c) and Minnesota
46.31Statutes, section 469.176, subdivision 4j, outside the boundaries of tax increment financing
46.32districts Nos. 11, 12, and 13, but only within the Northstar Transit Station District.
46.33    (e) The five-year rule under Minnesota Statutes, section 469.1763, subdivision 3,
46.34does not apply to the Northstar Transit Station District or to tax increment financing
46.35districts Nos. 11, 12, and 13.
47.1    (f) The use of revenues for decertification under Minnesota Statutes, section
47.2469.1763, subdivision 4 , does not apply to tax increment financing districts Nos. 11,
47.312, and 13.
47.4EFFECTIVE DATE.This section is effective upon approval by the governing body
47.5of the city of Fridley and upon compliance by the city with Minnesota Statutes, section
47.6645.021, subdivision 3.

47.7    Sec. 20. Laws 2008, chapter 154, article 9, section 24, is amended to read:
47.8    Sec. 24. CITY OF NEW BRIGHTON; TAX INCREMENT FINANCING;
47.9EXPENDITURES OUTSIDE DISTRICT.
47.10    Subdivision 1. Expenditures outside district. Notwithstanding the provisions
47.11of Minnesota Statutes, section 469.1763, subdivision 2, the city of New Brighton may
47.12expend increments generated from its tax increment financing district No. 26 to facilitate
47.13eligible activities as permitted by Minnesota Statutes, section 469.176, subdivision 4e,
47.14outside the boundaries of tax increment financing district No. 26, but only within the area
47.15described in Laws 1998, chapter 389, article 11, section 24, subdivision 1, and commonly
47.16referred to as the Northwest Quadrant. Minnesota Statutes, section 469.1763, subdivisions
47.173 and 4, do not apply to expenditures permitted by this section.
47.18    Subd. 2. District duration extension. Notwithstanding the provisions of Minnesota
47.19Statutes, section 469.176, subdivision 1b, or any other law to the contrary, the duration
47.20limits that apply to redevelopment tax increment financing districts numbers 31 and 32
47.21established under Laws 1998, chapter 389, article 11, section 24, and hazardous substance
47.22subdistricts numbers 31A and 32A established under Minnesota Statutes, sections 469.174
47.23to 469.1799, are extended by four years.
47.24EFFECTIVE DATE.This section is effective upon approval by the governing
47.25body of the city of New Brighton and compliance by the city with Minnesota Statutes,
47.26section 645.021, subdivision 3.

47.27    Sec. 21. CITY OF AUSTIN; TAX INCREMENT FINANCING AUTHORITY.
47.28    Notwithstanding the requirements of Minnesota Statutes, section 469.1763,
47.29subdivision 3, that activities must be undertaken within a five-year period from the date of
47.30certification of tax increment financing district and notwithstanding the provisions of any
47.31other law, the governing body of the city of Austin may use tax increments from its Tax
47.32Increment Financing District No. 9 to reimburse the city's housing and redevelopment
47.33authority for money spent disposing of soils and debris in the tax increment financing
47.34district, as required by the Minnesota Pollution Control Agency.
48.1EFFECTIVE DATE.This section is effective upon compliance by the governing
48.2body of the city of Austin with the requirements of Minnesota Statutes, section 645.021.

48.3    Sec. 22. BLOOMINGTON TAX INCREMENT FINANCING; FIVE-YEAR
48.4RULE.
48.5    The requirements of Minnesota Statutes, section 469.1763, subdivision 3, that
48.6activities must be undertaken within a five-year period from the date of certification of a
48.7tax increment financing district, are increased to a ten-year period for the Port Authority
48.8of the City of Bloomington's Tax Increment Financing District No. 1-I, Bloomington
48.9Central Station.
48.10EFFECTIVE DATE.This section is effective upon compliance by the governing
48.11body of the Port Authority of the City of Bloomington with the requirements of Minnesota
48.12Statutes, section 645.021.

48.13    Sec. 23. CITY OF DULUTH; EXTENSION OF TIME FOR ACTIVITY IN TAX
48.14INCREMENT FINANCING DISTRICT NO. 20.
48.15    The requirements of Minnesota Statutes, section 469.1763, subdivision 3, that
48.16activities must be undertaken within a five-year period from the date of certification of
48.17a tax increment financing district, must be considered to be met for Duluth Economic
48.18Development Authority Tax Increment Financing District No. 20 if the activities are
48.19undertaken within ten years from the date of certification of the district.
48.20EFFECTIVE DATE.This section is effective upon compliance by the governing
48.21body of the city of Duluth with the requirements of Minnesota Statutes, section 645.021.

48.22    Sec. 24. CITY OF DULUTH; EXTENSION OF TIME FOR ACTIVITY IN TAX
48.23INCREMENT FINANCING DISTRICT NO. 21.
48.24    The requirements of Minnesota Statutes, section 469.1763, subdivision 3, that
48.25activities must be undertaken within a five-year period from the date of certification of
48.26a tax increment financing district, must be considered to be met for Duluth Economic
48.27Development Authority Tax Increment Financing District No. 21 if the activities are
48.28undertaken within ten years from the date of certification of the district.
48.29EFFECTIVE DATE.This section is effective upon compliance by the governing
48.30body of the city of Duluth with the requirements of Minnesota Statutes, section 645.021.

48.31    Sec. 25. CITY OF WELLS; DISPOSITION OF TIF REVENUES.
48.32    Notwithstanding the provisions of Minnesota Statutes, section 469.174, subdivision
48.3325, the following are deemed not to be "increments," "tax increments," or "revenues
49.1derived from tax increment" for purposes of the redevelopment district in the city of
49.2Wells, identified as Downtown Development Program 1, for amounts received after
49.3decertification of the district:
49.4    (1) rents paid by private tenants for use of a building acquired in whole or in part
49.5with tax increments; and
49.6    (2) proceeds from the sale of the building.
49.7EFFECTIVE DATE.This section is effective upon compliance by the governing
49.8body of the city of Wells with the requirements of Minnesota Statutes, section 645.021.

49.9    Sec. 26. MULTICOUNTY HOUSING AND REDEVELOPMENT AUTHORITY
49.10LEVY AUTHORITY.
49.11    Notwithstanding Minnesota Statutes, section 469.033, subdivision 6, or any other
49.12law to the contrary, the governing body of the Northwest Minnesota Multicounty Housing
49.13and Redevelopment Authority, upon approval by a two-thirds majority of all its members,
49.14may levy an amount not to exceed 25 percent of the total levy permitted under Minnesota
49.15Statutes, section 469.033, subdivision 6, without approval of that levy by the governing
49.16body of the city or county within which the authority operates. The authority to levy the
49.17remainder of the total levy permitted under that provision remains subject to approval
49.18by the governing body of the city or county. For purposes of the levy authorized under
49.19this section only, the Northwest Minnesota Multicounty Housing and Redevelopment
49.20Authority is considered a special taxing jurisdiction as provided in Minnesota Statutes,
49.21section 275.066.
49.22EFFECTIVE DATE.This section is effective for taxes levied in 2008, payable in
49.232009, and is repealed effective for taxes levied in 2013, payable in 2014, and thereafter.

49.24    Sec. 27. CITY OF OAKDALE; EXTENDED DURATION FOR TAX
49.25INCREMENT FINANCING DISTRICTS.
49.26    (a) The provisions of this section apply to redevelopment tax increment financing
49.27districts created by the Housing and Redevelopment Authority in and for the city of
49.28Oakdale in the areas comprised of the parcels with the following parcel identification
49.29numbers: (1) 3102921320053; 3102921320054; 3102921320055; 3102921320056;
49.303102921320057; 3102921320058; 3102921320062; 3102921320063; 3102921320059;
49.313102921320060; and 3102921320061; and (2) 3102921330005 and 3102921330004.
49.32    (b) For a district subject to this section, the Housing and Redevelopment Authority
49.33may, when requesting certification of the original tax capacity of the district under
50.1Minnesota Statutes, section 469.177, elect to have the original tax capacity of the district
50.2be certified as the tax capacity of the land.
50.3    (c) The authority to request certification of a district under this section expires on
50.4July 1, 2013.
50.5EFFECTIVE DATE; LOCAL APPROVAL.This section is effective upon
50.6approval by the governing body of the city of Oakdale and compliance with Minnesota
50.7Statutes, section 645.021, subdivision 3.

50.8    Sec. 28. DEED GRANTS.
50.9    $1,000,000 is appropriated to the commissioner of the Department of Employment
50.10and Economic Development from the general fund for fiscal year 2009 for the purpose of
50.11making grants of $500,000 each to the cities of Minneapolis and Saint Paul for capital
50.12improvements or related costs of the Target Center and RiverCentre facilities.


50.15    Section 1. Minnesota Statutes 2006, section 216B.1646, is amended to read:
50.16216B.1646 RATE REDUCTION ADJUSTMENT; PROPERTY TAX
50.17REDUCTION CHANGE.
50.18    (a) The commission shall, by any method the commission finds appropriate, reduce
50.19adjust the rates each electric utility subject to rate regulation by the commission charges
50.20its customers to reflect, on an ongoing basis, the amount by which each utility's property
50.21tax, including the state general tax, if applicable, on the personal property of its electric
50.22system from taxes payable in 2001 to taxes payable in 2002 is reduced or pipeline system
50.23transporting or distributing natural gas is changed under this act. The commission must
50.24ensure that, to the extent feasible, each dollar of personal property tax reduction allocated
50.25to Minnesota consumers retroactive to January 1, 2002, change in taxes payable in 2009
50.26and subsequent years results in a dollar of savings adjustment to the utility's customers
50.27rates. A utility may voluntarily pass on any additional property tax savings allocated in
50.28the same manner as approved by the commission under this paragraph. The adjustment
50.29under this paragraph is outside of a general rate case proceeding under section 216B.16.
50.30    (b) By April 10, 2002, Each utility shall may submit a filing to the commission
50.31containing:
50.32    (1) certified information regarding the utility's property tax savings change allocated
50.33to Minnesota retail customers; and
51.1    (2) a proposed method of passing these savings on adjusting rates to Minnesota
51.2retail customers.
51.3The utility shall provide the information in clause (1) to the commissioner of revenue at
51.4the same time. The commissioner shall notify the commission within 30 days as to the
51.5accuracy of the property tax data submitted by the utility.
51.6    (c) For purposes of this section, "personal property" means tools, implements, and
51.7machinery of the generating plant. It does not apply to transformers, transmission lines,
51.8distribution lines, or any other tools, implements, and machinery that are part of an electric
51.9substation, wherever located an electric system or of a pipeline system transporting or
51.10distributing natural gas.

51.11    Sec. 2. Minnesota Statutes 2006, section 270C.85, subdivision 2, is amended to read:
51.12    Subd. 2. Powers and duties. The commissioner shall have and exercise the
51.13following powers and duties in administering the property tax laws.
51.14    (a) Confer with, advise, and give the necessary instructions and directions to local
51.15assessors and local boards of review throughout the state as to their duties under the
51.16laws of the state.
51.17    (b) Direct proceedings, actions, and prosecutions to be instituted to enforce the
51.18laws relating to the liability and punishment of public officers and officers and agents of
51.19corporations for failure or negligence to comply with the provisions of the property tax
51.20laws, and cause complaints to be made against local assessors, members of boards of
51.21equalization, members of boards of review, or any other assessing or taxing officer, to the
51.22proper authority, for their removal from office for misconduct or negligence of duty.
51.23    (c) Require county attorneys to assist in the commencement of prosecutions in
51.24actions or proceedings for removal, forfeiture, and punishment, for violation of the
51.25property tax laws in their respective districts or counties.
51.26    (d) Require town, city, county, and other public officers to report information as to
51.27the assessment of property, and such other information as may be needful in the work of
51.28the commissioner, in such form as the commissioner may prescribe.
51.29    (e) Transmit to the governor, on or before the third Monday in December of each
51.30even-numbered year, and to each member of the legislature, on or before November
51.3115 of each even-numbered year, the report of the department for the preceding years,
51.32showing all the taxable property subject to the property tax laws and the value of the
51.33same, in tabulated form.
51.34    (f) Inquire into the methods of assessment and taxation and ascertain whether the
51.35assessors faithfully discharge their duties.
52.1    (g) Assist local assessors in determining the estimated market value of industrial
52.2special-use property. For purposes of this paragraph, "industrial special-use property"
52.3means property that:
52.4    (1) is designed and equipped for a particular type of industry;
52.5    (2) is not easily adapted to some other use due to the unique nature of the facilities;
52.6    (3) has facilities totaling at least 75,000 square feet in size; and
52.7    (4) has a total estimated market value of $10,000,000 or greater based on the
52.8assessor's preliminary determination.
52.9EFFECTIVE DATE.This section is effective for assessment year 2009 and
52.10thereafter, for taxes payable in 2010 and thereafter.

52.11    Sec. 3. Minnesota Statutes 2006, section 272.02, is amended by adding a subdivision
52.12to read:
52.13    Subd. 85. Fergus Falls historical zone. (a) Property located in the area of the
52.14campus of the former state regional treatment center in the city of Fergus Falls, including
52.15the five buildings and associated land that were acquired by the city prior to January 1,
52.162007, is exempt from ad valorem taxes levied under chapter 275.
52.17    (b) The exemption applies for 15 calendar years from the date specified by resolution
52.18of the governing body of the city of Fergus Falls. For the final three assessment years of
52.19the duration limit, the exemption applies to the following percentages of estimated market
52.20value of the property:
52.21    (1) for the third to the last assessment year of the duration, 75 percent;
52.22    (2) for the second to the last assessment year of the duration, 50 percent; and
52.23    (3) for the last assessment year of the duration, 25 percent.
52.24EFFECTIVE DATE.This section is effective for property taxes payable in 2009
52.25and thereafter.

52.26    Sec. 4. Minnesota Statutes 2006, section 272.02, is amended by adding a subdivision
52.27to read:
52.28    Subd. 86. Electric generation facility; personal property. (a) Notwithstanding
52.29subdivision 9, paragraph (a), attached machinery and other personal property which is
52.30part of a simple-cycle combustion-turbine electric generation facility that exceeds 150
52.31megawatts of installed capacity and that meets the requirements of this subdivision is
52.32exempt. At the time of construction, the facility must:
52.33    (1) utilize natural gas as a primary fuel;
52.34    (2) be owned by an electric generation and transmission cooperative;
53.1    (3) be located within one mile of an existing 16-inch natural gas pipeline and a
53.269-kilovolt and a 230-kilovolt high-voltage electric transmission line;
53.3    (4) be designed to provide peaking, emergency backup, or contingency services;
53.4    (5) have received a certificate of need under section 216B.243 demonstrating
53.5demand for its capacity; and
53.6    (6) have received by resolution the approval from the governing bodies of the county
53.7and the city in which the proposed facility is to be located for the exemption of personal
53.8property under this subdivision.
53.9    (b) Construction of the facility must be commenced after January 1, 2008, and
53.10before January 1, 2012. Property eligible for this exemption does not include electric
53.11transmission lines and interconnections or gas pipelines and interconnections appurtenant
53.12to the property or the facility.
53.13EFFECTIVE DATE.This section is effective for the 2008 assessment payable in
53.142009 and thereafter.

53.15    Sec. 5. [273.0645] COMMISSIONER REVIEW OF LOCAL ASSESSMENT
53.16PRACTICES.
53.17    The commissioner of revenue must review the assessment practices in a taxing
53.18jurisdiction if requested in writing by a qualifying number of property owners in that
53.19taxing jurisdiction. The request must be signed by the greater of:
53.20    (1) one percent of the property owners; or
53.21    (2) five property owners.
53.22    The request must identify the city, town, or county and describe why a review is
53.23sought for that taxing jurisdiction. The commissioner must conduct the review in a
53.24reasonable amount of time and report the findings to the county board of the affected
53.25county, to the affected city council or town board, if the review is for a specific city or
53.26town, and to the property owner designated in the request as the person to receive the
53.27report on behalf of all the property owners who signed the request. The commissioner
53.28must also provide the report electronically to all property owners who signed the request
53.29and provided an e-mail address in order to receive the report electronically.
53.30EFFECTIVE DATE.This section is effective the day following final enactment.

53.31    Sec. 6. Minnesota Statutes 2006, section 273.11, subdivision 1, is amended to read:
53.32    Subdivision 1. Generally. Except as provided in this section or section 273.17,
53.33subdivision 1 , all property shall be valued at its market value. The market value as
53.34determined pursuant to this section shall be stated such that any amount under $100 is
54.1rounded up to $100 and any amount exceeding $100 shall be rounded to the nearest $100.
54.2In estimating and determining such value, the assessor shall not adopt a lower or different
54.3standard of value because the same is to serve as a basis of taxation, nor shall the assessor
54.4adopt as a criterion of value the price for which such property would sell at a forced
54.5sale, or in the aggregate with all the property in the town or district; but the assessor
54.6shall value each article or description of property by itself, and at such sum or price as
54.7the assessor believes the same to be fairly worth in money. The assessor shall take into
54.8account the effect on the market value of property of environmental factors in the vicinity
54.9of the property, and the market value effect of foreclosed property on all property in the
54.10vicinity due to the foreclosures. In assessing any tract or lot of real property, the value
54.11of the land, exclusive of structures and improvements, shall be determined, and also the
54.12value of all structures and improvements thereon, and the aggregate value of the property,
54.13including all structures and improvements, excluding the value of crops growing upon
54.14cultivated land. In valuing real property upon which there is a mine or quarry, it shall be
54.15valued at such price as such property, including the mine or quarry, would sell for at a fair,
54.16voluntary sale, for cash, if the material being mined or quarried is not subject to taxation
54.17under section 298.015 and the mine or quarry is not exempt from the general property
54.18tax under section 298.25. In valuing real property which is vacant, platted property shall
54.19be assessed as provided in subdivision 14. All property, or the use thereof, which is
54.20taxable under section 272.01, subdivision 2, or 273.19, shall be valued at the market
54.21value of such property and not at the value of a leasehold estate in such property, or at
54.22some lesser value than its market value.
54.23EFFECTIVE DATE.This section is effective for the 2009 assessment and
54.24thereafter.

54.25    Sec. 7. Minnesota Statutes 2006, section 273.11, subdivision 1a, is amended to read:
54.26    Subd. 1a. Limited market value. In the case of all property classified as
54.27agricultural homestead or nonhomestead, residential homestead or nonhomestead, timber,
54.28or noncommercial seasonal residential recreational, the assessor shall compare the value
54.29with the taxable portion of the value determined in the preceding assessment.
54.30    For assessment years 2004, 2005, and 2006, the amount of the increase shall not
54.31exceed the greater of (1) 15 percent of the value in the preceding assessment, or (2) 25
54.32percent of the difference between the current assessment and the preceding assessment.
54.33    For assessment year years 2007 through 2009, the amount of the increase shall not
54.34exceed the greater of (1) 15 percent of the value in the preceding assessment, or (2) 33
54.35percent of the difference between the current assessment and the preceding assessment.
55.1    For assessment year 2008 2010, the amount of the increase shall not exceed the
55.2greater of (1) 15 percent of the value in the preceding assessment, or (2) 50 percent of the
55.3difference between the current assessment and the preceding assessment.
55.4    This limitation shall not apply to increases in value due to improvements. For
55.5purposes of this subdivision, the term "assessment" means the value prior to any exclusion
55.6under subdivision 16.
55.7    The provisions of this subdivision shall be in effect through assessment year 2008
55.82010 as provided in this subdivision.
55.9    For purposes of the assessment/sales ratio study conducted under section 127A.48,
55.10and the computation of state aids paid under chapters 122A, 123A, 123B, 124D, 125A,
55.11126C, 127A, and 477A, market values and net tax capacities determined under this
55.12subdivision and subdivision 16, shall be used.
55.13EFFECTIVE DATE.This section is effective for assessment year 2008 and
55.14thereafter, for taxes payable in 2009 and thereafter.

55.15    Sec. 8. Minnesota Statutes 2006, section 273.11, subdivision 14b, is amended to read:
55.16    Subd. 14b. Vacant land platted on or after August 1, 2001; located in
55.17nonmetropolitan counties. (a) All land platted on or after (i) August 1, 2001, and
55.18located in a nonmetropolitan county, or (ii) August 1, 2008, and located in a metropolitan
55.19county, and not improved with a permanent structure, shall be assessed as provided in this
55.20subdivision. The assessor shall determine the market value of each individual lot based
55.21upon the highest and best use of the property as unplatted land. In establishing the market
55.22value of the property, the assessor shall consider the sale price of the unplatted land or
55.23comparable sales of unplatted land of similar use and similar availability of public utilities.
55.24    (b) The market value determined in paragraph (a) shall be increased as follows for
55.25each of the seven assessment years immediately following the final approval of the plat:
55.26one-seventh of the difference between the property's unplatted market value as determined
55.27under paragraph (a) and the market value based upon the highest and best use of the land
55.28as platted property shall be added in each of the seven subsequent assessment years.
55.29    (c) Any increase in market value after the first assessment year following the plat's
55.30final approval shall be added to the property's market value in the next assessment year.
55.31Notwithstanding paragraph (b), if the property is sold or transferred, or construction
55.32begins before the expiration of the seven years in paragraph (b), that lot shall be eligible
55.33for revaluation in the next assessment year. The market value of a platted lot determined
55.34under this subdivision shall not exceed the value of that lot based upon the highest and
55.35best use of the property as platted land.
56.1EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
56.2thereafter.

56.3    Sec. 9. Minnesota Statutes 2006, section 273.11, is amended by adding a subdivision to
56.4read:
56.5    Subd. 14c. Vacant land platted on or after August 1, 2001, and prior to August
56.61, 2008; located in metropolitan county; phase-in readjusted. (a) All land platted on or
56.7after August 1, 2001, and prior to August 1, 2008, located in a metropolitan county and not
56.8improved with a structure shall be eligible for the phase-in assessment schedule under this
56.9section. Based upon the assessor's records, the assessor shall obtain the estimated market
56.10value of each individual lot based upon the highest and best use of the property as unplatted
56.11land for the assessment year that the property was platted. In establishing the market value
56.12of the property, the assessor shall have considered the sale price of the unplatted land or
56.13comparable sales of unplatted land of similar use and similar availability of public utilities.
56.14    (b) The market value determined in paragraph (a) plus one-seventh of the difference
56.15between the property's unplatted market value as determined under paragraph (a) and the
56.16market value based upon the highest and best use of the land as platted property in the
56.17current year, multiplied by the number of assessment years since the property was platted,
56.18shall be added in each of the subsequent assessment years.
56.19    (c) Notwithstanding paragraph (b), if the property is sold or transferred, or
56.20construction begins before the expiration of the phase-in in paragraph (b), that lot shall
56.21be eligible for revaluation in the next assessment year. The market value of a platted lot
56.22determined under this subdivision shall not exceed the value of that lot based upon the
56.23highest and best use of the property as platted land.
56.24    (d) For purposes of this section, "metropolitan county" means the counties of Anoka,
56.25Carver, Dakota, Hennepin, Ramsey, Scott, and Washington.
56.26EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
56.27thereafter.

56.28    Sec. 10. Minnesota Statutes 2006, section 273.11, is amended by adding a subdivision
56.29to read:
56.30    Subd. 24. Rural vacant land abutting public waters. (a) Any property that:
56.31    (1) is located in a township;
56.32    (2) is classified as either (i) agricultural property under section 273.13, subdivision
56.3323, paragraph (b), or (ii) rural vacant land under section 273.13, subdivision 23, paragraph
57.1(c), contiguous to agricultural property under the same ownership with at least two-thirds
57.2of the acreage used for agricultural purposes;
57.3    (3) is not enrolled in the Minnesota agricultural property tax law under section
57.4273.111; and
57.5    (4) abuts public waters in whole or in part,
57.6shall be valued by the assessor on the same basis as rural vacant land of the same quality
57.7that does not abut public waters, until some action is taken to develop the land as specified
57.8in paragraph (c).
57.9    (b) In each assessment year, the assessor shall determine the estimated market value
57.10of the property as provided under subdivision 1, taking into consideration its highest
57.11and best use. For each year that the property is classified under this subdivision, the
57.12property tax statement shall include a notice that the property is being taxed under a
57.13reduced valuation that will terminate under certain conditions.
57.14    (c) An owner of property meeting the criteria of this subdivision must notify the
57.15county assessor within 30 days of applying for a development permit from the county
57.16or local zoning board. If development permits are not required, an owner of property
57.17meeting the criteria of this subdivision must notify the assessor prior to all or any portion
57.18of the property being platted or subdivided.
57.19    (d) When any of the conditions specified in paragraph (c) occurs, additional taxes
57.20shall be imposed in an amount equal to: (1) the average of the difference between the
57.21amount of taxes actually levied on the property in the current year and the two prior years,
57.22and the amount of taxes that would have been levied in the current year and the two prior
57.23years based on the estimated market value determined under paragraph (b); (2) multiplied
57.24by seven or the number of years that the property has qualified under this subdivision,
57.25whichever is less. The additional taxes shall be extended against the property on the tax list
57.26for the current year, provided that no interest or penalties shall be levied on the additional
57.27taxes if timely paid. For purposes of this subdivision, "public waters" means a meandered
57.28lake as defined under section 103G.005, subdivision 15, paragraph (a), clause (3).
57.29EFFECTIVE DATE.This section is effective for the 2009 assessment and
57.30thereafter.

57.31    Sec. 11. Minnesota Statutes 2006, section 273.11, is amended by adding a subdivision
57.32to read:
57.33    Subd. 25. Limit on taxable valuation; certain restored homes. A homestead
57.34property that either (i) has gone through foreclosure or (ii) is located within a disaster
57.35or emergency area and sustained physical damage of at least $5,000 in the disaster or
58.1emergency is eligible for valuation limitation under this subdivision. To qualify for the
58.2limitation, the property must:
58.3    (i) have been restored or rebuilt within 18 months of the foreclosure or the disaster
58.4or emergency;
58.5    (ii) have a gross living area that does not exceed 130 percent of the gross living area
58.6prior to the foreclosure or the disaster or emergency; and
58.7    (iii) have an estimated market value that exceeds its taxable market value for the
58.8assessment year of the foreclosure or the disaster or emergency by at least $20,000, due to
58.9the restoration or reconstruction.
58.10    In the first assessment year following the restoration or reconstruction, the taxable
58.11value shall be equal to three-quarters of its taxable value in the assessment year of the
58.12foreclosure or disaster or emergency, plus one-quarter of its current estimated market
58.13value. In the second assessment year following the restoration or reconstruction, the
58.14taxable value shall be equal to one-half of its taxable value in the assessment year of the
58.15foreclosure or disaster or emergency, and one-half of its current estimated market value.
58.16In the third assessment year following the restoration or reconstruction, the taxable value
58.17shall be equal to one-quarter of its taxable value in the assessment year of the foreclosure
58.18or disaster or emergency, and three-quarters of its current estimated market value. For
58.19the three assessment years immediately following the restoration or reconstruction, the
58.20property is not subject to the valuation limit under subdivision 1a.
58.21    For the purposes of this subdivision:
58.22    (i) "disaster or emergency area" means an area in which the president of the United
58.23States or the administrator of the Small Business Administration has determined that
58.24a disaster exists pursuant to federal law;
58.25    (ii) "gone through foreclosure" means that a foreclosure sale has been held and that
58.26the person who owned the home prior to the sale did not redeem it from the sale under
58.27section 580.23; and
58.28    (iii) "gross living area" means the square footage of the home that would customarily
58.29be used as living space.
58.30EFFECTIVE DATE.This section is effective for assessment year 2009 and
58.31thereafter.

58.32    Sec. 12. Minnesota Statutes 2006, section 273.111, subdivision 3, as amended by Laws
58.332008, chapter 154, article 13, section 26, is amended to read:
58.34    Subd. 3. Requirements. (a) Real estate consisting of ten three acres or more or
58.35a nursery or greenhouse, and qualifying for classification as class 1b, 2a, or 2b under
59.1section 273.13, shall be entitled to valuation and tax deferment under this section only
59.2if it is primarily devoted to agricultural use, and meets the qualifications in subdivision
59.36, and either:
59.4    (1) is the homestead of the owner, or of a surviving spouse, child, or sibling of the
59.5owner or is real estate which is farmed with the real estate which contains the homestead
59.6property; or
59.7    (2) has been in possession of the applicant, the applicant's spouse, parent, or sibling,
59.8or any combination thereof, for a period of at least seven years prior to application for
59.9benefits under the provisions of this section, or is real estate which is farmed with the
59.10real estate which qualifies under this clause and is within four townships or cities or
59.11combination thereof from the qualifying real estate; or
59.12    (3) is the homestead of a shareholder in a family farm corporation as defined in an
59.13individual who is part of an entity in compliance with section 500.24, notwithstanding
59.14the fact that legal title to the real estate may be held in the name of the family farm
59.15corporation; or
59.16    (4) is in the possession of a nursery or greenhouse or an entity owned by a proprietor,
59.17partnership, or corporation which also owns the nursery or greenhouse operations on the
59.18parcel or parcels, provided that only the acres used to produce nursery stock qualify
59.19for treatment under this section.
59.20    (b) Valuation of real estate under this section is limited to parcels the ownership of
59.21which is in noncorporate entities except for:
59.22    (1) family farm corporations organized pursuant to section 500.24; and
59.23    (2) corporations that derive 80 percent or more of their gross receipts from the
59.24wholesale or retail sale of horticultural or nursery stock.
59.25    (c) Land that previously qualified for tax deferment under this section and no longer
59.26qualifies because it is not primarily used for agricultural purposes but would otherwise
59.27qualify under subdivisions Minnesota Statutes 2006, section 273.111, subdivision 3 and 6,
59.28 for a period of at least three years will not be required to make payment of the previously
59.29deferred taxes, notwithstanding the provisions of subdivision 9. Sale of the land prior to
59.30the expiration of the three-year period requires payment of deferred taxes as follows: sale
59.31in the year the land no longer qualifies requires payment of the current year's deferred
59.32taxes plus payment of deferred taxes for the two prior years; sale during the second year
59.33the land no longer qualifies requires payment of the current year's deferred taxes plus
59.34payment of the deferred taxes for the prior year; and sale during the third year the land
59.35no longer qualifies requires payment of the current year's deferred taxes. Deferred taxes
59.36shall be paid even if the land qualifies pursuant to subdivision 11a. When such property is
60.1sold or no longer qualifies under this paragraph, or at the end of the three-year period,
60.2whichever comes first, all deferred special assessments plus interest are payable in equal
60.3installments spread over the time remaining until the last maturity date of the bonds issued
60.4to finance the improvement for which the assessments were levied. If the bonds have
60.5matured, the deferred special assessments plus interest are payable within 90 days. The
60.6provisions of section 429.061, subdivision 2, apply to the collection of these installments.
60.7Penalties are not imposed on any such special assessments if timely paid.
60.8EFFECTIVE DATE.This section is effective for assessment year 2009, taxes
60.9payable in 2010 and thereafter.

60.10    Sec. 13. Minnesota Statutes 2006, section 273.111, is amended by adding a subdivision
60.11to read:
60.12    Subd. 3a. Property no longer eligible for deferment. Real estate that qualifies for
60.13tax deferment under this section for assessment year 2008, but which does not qualify
60.14for the current assessment year due to changes in qualification requirements under this
60.15act, shall continue to qualify until the land is sold or transferred, provided that the
60.16property continues to meet the requirements of Minnesota Statutes 2006, section 273.111,
60.17subdivision 3.
60.18EFFECTIVE DATE.This section is effective for taxes payable in 2010 and
60.19thereafter.

60.20    Sec. 14. Minnesota Statutes 2006, section 273.111, subdivision 4, is amended to read:
60.21    Subd. 4. Determination of value. (a) The value of any real estate described
60.22in subdivision 3 shall upon timely application by the owner, in the manner provided
60.23in subdivision 8, be determined solely with reference to its appropriate agricultural
60.24classification and value notwithstanding sections 272.03, subdivision 8, and 273.11. In
60.25determining the value for ad valorem tax purposes, the assessor shall use sales data for
60.26agricultural lands located outside the seven metropolitan counties having similar soil
60.27types, number of degree days, and other similar agricultural characteristics. Furthermore,
60.28the assessor shall not consider any added values resulting from nonagricultural factors.
60.29In order to account for the presence of nonagricultural influences that may affect the value
60.30of agricultural land, the commissioner of revenue shall develop a fair and uniform method
60.31of determining agricultural values for each county in the state that are consistent with this
60.32subdivision. The commissioner shall annually assign the resulting values to each county,
60.33and these values shall be used as the basis for determining the agricultural value for all
60.34properties in the county qualifying for tax deferment under this section.
61.1    (b) In the case of property qualifying for tax deferment only under subdivision 3a,
61.2the value shall be based on the value in effect for assessment year 2008, multiplied by
61.3the ratio of the total taxable market value of all property in the county for the current
61.4assessment year divided by the total taxable market value of all property in the county
61.5for assessment year 2008.
61.6EFFECTIVE DATE.This section is effective for assessment year 2009 and
61.7thereafter.

61.8    Sec. 15. Minnesota Statutes 2006, section 273.111, subdivision 8, is amended to read:
61.9    Subd. 8. Application. Application for deferment of taxes and assessment under this
61.10section shall be filed by May 1 of the year prior to the year in which the taxes are payable.
61.11Any application filed hereunder and granted shall continue in effect for subsequent years
61.12until the property no longer qualifies. Such application shall be filed with the assessor of
61.13the taxing district in which the real property is located on such form as may be prescribed
61.14by the commissioner of revenue. The assessor may require proof by affidavit or otherwise
61.15that the property qualifies under subdivisions subdivision 3 and 6.
61.16EFFECTIVE DATE.This section is effective for taxes payable in 2010 and
61.17thereafter.

61.18    Sec. 16. Minnesota Statutes 2006, section 273.111, subdivision 9, is amended to read:
61.19    Subd. 9. Additional taxes. When real property which is being, or has been valued
61.20and assessed under this section no longer qualifies under subdivisions subdivision 3
61.21and 6 or 3a, the portion no longer qualifying shall be subject to additional taxes, in the
61.22amount equal to the average difference between the taxes determined in accordance with
61.23subdivision 4, and the amount determined under subdivision 5, for the current year and
61.24the two preceding years, multiplied by seven or the number of years enrolled under
61.25section 273.111, whichever is less. Provided, however, that the amount determined under
61.26subdivision 5 shall not be greater than it would have been had the actual bona fide sale
61.27price of the real property at an arm's-length transaction been used in lieu of the market
61.28value determined under subdivision 5. Such additional taxes shall be extended against
61.29the property on the tax list for the current year, provided, however, that no interest or
61.30penalties shall be levied on such additional taxes if timely paid, and provided further, that
61.31such additional taxes shall only be levied with respect to the last three years that the said
61.32property has been valued and assessed under this section.
61.33EFFECTIVE DATE.This section is effective for taxes payable in 2010 and
61.34thereafter.

62.1    Sec. 17. Minnesota Statutes 2006, section 273.111, subdivision 11, is amended to read:
62.2    Subd. 11. Special local assessments. The payment of special local assessments
62.3levied after June 1, 1967, for improvements made to any real property described in
62.4subdivision 3 together with the interest thereon shall, on timely application as provided
62.5in subdivision 8, be deferred as long as such property meets the conditions contained in
62.6subdivisions subdivision 3 and 6 or 3a or is transferred to an agricultural preserve under
62.7sections 473H.02 to 473H.17. If special assessments against the property have been
62.8deferred pursuant to this subdivision, the governmental unit shall file with the county
62.9recorder in the county in which the property is located a certificate containing the legal
62.10description of the affected property and of the amount deferred. When such property
62.11no longer qualifies under subdivisions subdivision 3 and 6 or 3a, all deferred special
62.12assessments plus interest shall be payable in equal installments spread over the time
62.13remaining until the last maturity date of the bonds issued to finance the improvement
62.14for which the assessments were levied. If the bonds have matured, the deferred special
62.15assessments plus interest shall be payable within 90 days. The provisions of section
62.16429.061, subdivision 2 , apply to the collection of these installments. Penalty shall not be
62.17levied on any such special assessments if timely paid.
62.18EFFECTIVE DATE.This section is effective for taxes payable in 2010 and
62.19thereafter.

62.20    Sec. 18. Minnesota Statutes 2006, section 273.111, subdivision 11a, is amended to read:
62.21    Subd. 11a. Continuation of tax treatment upon sale. When real property
62.22qualifying under subdivisions subdivision 3 and 6 is sold, no additional taxes or deferred
62.23special assessments plus interest shall be extended against the property provided the
62.24property continues to qualify pursuant to subdivisions subdivision 3 and 6, and provided
62.25the new owner files an application for continued deferment within 30 days after the sale.
62.26    For purposes of meeting the income requirements of subdivision 6, the property
62.27purchased shall be considered in conjunction with other qualifying property owned by
62.28the purchaser.
62.29EFFECTIVE DATE.This section is effective for taxes payable in 2010 and
62.30thereafter.

62.31    Sec. 19. [273.113] TAX CREDIT FOR PROPERTY IN BOVINE
62.32TUBERCULOSIS MANAGEMENT ZONES.
62.33    Subdivision 1. Definition. For the purposes of this section, "bovine tuberculosis
62.34management zone" means the area within the ten-mile radius around the five presumptive
63.1tuberculosis-positive deer sampled during the fall 2006 hunter-harvested surveillance
63.2effort.
63.3    Subd. 2. Eligibility; credit on agricultural land; cattle herds. Land classified
63.4as class 2a or 2b under section 273.13, subdivision 23, located in a bovine tuberculosis
63.5management zone is eligible for a property tax credit if the property owner has eradicated
63.6a cattle herd that had been kept on that land for at least part of the year in order to prevent
63.7the onset or spread of bovine tuberculosis. The net credit is equal to that portion of the tax
63.8relating to the market value of the land on the parcels where the herd had been located after
63.9all other applicable credits have been deducted. To initially qualify for the tax credit, the
63.10property owner shall file an application with the county by January 2 of the year following
63.11the calendar year when the herd was eradicated. The credit must be given for each taxes
63.12payable year following the calendar year when the herd was eradicated and must terminate
63.13for all taxes payable years beginning after the calendar year when a new herd of cattle was
63.14placed on the land or as provided in subdivision 5. The auditor shall indicate the amount of
63.15the property tax reduction on the property tax statement of each taxpayer receiving a credit
63.16under this section. Notwithstanding section 276.04, subdivision 3, property tax statements
63.17of properties eligible for a credit under this section must be mailed no later than April 15.
63.18    Subd. 3. Eligibility; credit on hunting land; deer and elk herds. Land located
63.19in a bovine tuberculosis management zone that is primarily used for hunting purposes is
63.20eligible for a property tax credit if (1) the property owner or the Department of Natural
63.21Resources has eradicated the deer and elk herd on that land in order to prevent the onset or
63.22spread of bovine tuberculosis, (2) the property owner adheres strictly to the deer and elk
63.23feeding ban, and (3) the property owner makes every effort to keep their land free of deer
63.24and elk. The net credit is equal to the property tax on the parcel where the herd had been
63.25located after all other applicable credits have been deducted. The credit is only on that
63.26portion of the tax relating to the market value of the land. To initially qualify for the tax
63.27credit, the property owner shall file an application with the county by January 2 of the
63.28year following the calendar year when the deer or elk herd was eradicated. To receive
63.29the tax credit in subsequent years, the property owner shall file by January 2 of each
63.30subsequent year until the state is upgraded to a bovine tuberculosis status of modified
63.31accredited advanced. The county board must approve the application before the credit
63.32is allowed. The credit is for each taxes payable year following the calendar year when
63.33the deer or elk herd was eradicated and must terminate as provided in subdivision 5.
63.34The auditor shall indicate the amount of the property tax reduction on the property tax
63.35statement of each taxpayer receiving a credit under this section. Notwithstanding section
64.1276.04, subdivision 3, property tax statements of properties eligible for a credit under this
64.2section must be mailed no later than April 15.
64.3    Subd. 4. Reimbursement for lost revenue; appropriations. The county auditor
64.4shall certify to the commissioner of revenue, as part of the abstracts of tax lists required to
64.5be filed with the commissioner under section 275.29, the amount of tax lost to the county
64.6from the property tax credit under this section after all other applicable credits have been
64.7deducted. Any prior year adjustments must also be certified in the abstracts of tax lists.
64.8The commissioner of revenue shall review the certifications to determine their accuracy.
64.9The commissioner may make the changes in the certification that are considered necessary
64.10or return a certification to the county auditor for corrections. The commissioner shall
64.11reimburse each taxing district for the taxes lost. The payments must be made at the time
64.12provided in section 273.1398, subdivision 6, for payment to taxing jurisdictions in the
64.13same proportion that the ad valorem tax is distributed. The amount necessary to make the
64.14reimbursements under this section is annually appropriated from the general fund to the
64.15commissioner of revenue. The credits paid under this section shall be deducted from the
64.16tax due on the property as provided in section 273.1393.
64.17    Subd. 5. Termination of credit. The credit provided under this section ceases to
64.18be available beginning with any assessment year following the date when the United
64.19States Department of Agriculture publishes notice in the Federal Register that the state is
64.20upgraded to a bovine tuberculosis status of modified accredited advanced.
64.21EFFECTIVE DATE.This section is effective beginning with taxes payable in 2009.

64.22    Sec. 20. Minnesota Statutes 2006, section 273.121, as amended by Laws 2008, chapter
64.23154, article 13, section 28, is amended to read:
64.24273.121 VALUATION OF REAL PROPERTY, NOTICE.
64.25    Subdivision 1. Notice. Any county assessor or city assessor having the powers of a
64.26county assessor, valuing or classifying taxable real property shall in each year notify those
64.27persons whose property is to be included on the assessment roll that year if the person's
64.28address is known to the assessor, otherwise the occupant of the property. The notice shall
64.29be in writing and shall be sent by ordinary mail at least ten days before the meeting of
64.30the local board of appeal and equalization under section 274.01 or the review process
64.31established under section 274.13, subdivision 1c. Upon written request by the owner of the
64.32property, the assessor may send the notice in electronic form or by electronic mail instead
64.33of on paper or by ordinary mail. It shall contain: (1) the market value for the current and
64.34prior assessment, (2) the limited market value under section 273.11, subdivision 1a, for
64.35the current and prior assessment, (3) the qualifying amount of any improvements under
65.1section 273.11, subdivision 16, for the current assessment, (4) the market value subject
65.2to taxation after subtracting the amount of any qualifying improvements for the current
65.3assessment, (5) the classification of the property for the current and prior assessment,
65.4(6) a note that if the property is homestead and at least 45 years old, improvements
65.5made to the property may be eligible for a valuation exclusion under section 273.11,
65.6subdivision 16 , (7) the assessor's office address, and (8) the dates, places, and times set for
65.7the meetings of the local board of appeal and equalization, the review process established
65.8under section 274.13, subdivision 1c, and the county board of appeal and equalization.
65.9The commissioner of revenue shall specify the form of the notice. The assessor shall
65.10attach to the assessment roll a statement that the notices required by this section have been
65.11mailed. Any assessor who is not provided sufficient funds from the assessor's governing
65.12body to provide such notices, may make application to the commissioner of revenue
65.13to finance such notices. The commissioner of revenue shall conduct an investigation
65.14and, if satisfied that the assessor does not have the necessary funds, issue a certification
65.15to the commissioner of finance of the amount necessary to provide such notices. The
65.16commissioner of finance shall issue a warrant for such amount and shall deduct such
65.17amount from any state payment to such county or municipality. The necessary funds to
65.18make such payments are hereby appropriated. Failure to receive the notice shall in no way
65.19affect the validity of the assessment, the resulting tax, the procedures of any board of
65.20review or equalization, or the enforcement of delinquent taxes by statutory means.
65.21    Subd. 2. Availability of data. The notice must state where the information on
65.22the property is available, the times when the information may be viewed by the public,
65.23and the county's Web site address.
65.24EFFECTIVE DATE.This section is effective for notices prepared in 2009 and
65.25thereafter.

65.26    Sec. 21. Minnesota Statutes 2006, section 273.124, subdivision 1, is amended to read:
65.27    Subdivision 1. General rule. (a) Residential real estate that is occupied and used
65.28for the purposes of a homestead by its owner, who must be a Minnesota resident, is
65.29a residential homestead.
65.30    Agricultural land, as defined in section 273.13, subdivision 23, that is occupied and
65.31used as a homestead by its owner, who must be a Minnesota resident, is an agricultural
65.32homestead.
65.33    Dates for establishment of a homestead and homestead treatment provided to
65.34particular types of property are as provided in this section.
66.1    Property held by a trustee under a trust is eligible for homestead classification if the
66.2requirements under this chapter are satisfied.
66.3    The assessor shall require proof, as provided in subdivision 13, of the facts upon
66.4which classification as a homestead may be determined. Notwithstanding any other law,
66.5the assessor may at any time require a homestead application to be filed in order to verify
66.6that any property classified as a homestead continues to be eligible for homestead status.
66.7Notwithstanding any other law to the contrary, the Department of Revenue may, upon
66.8request from an assessor, verify whether an individual who is requesting or receiving
66.9homestead classification has filed a Minnesota income tax return as a resident for the most
66.10recent taxable year for which the information is available.
66.11    When there is a name change or a transfer of homestead property, the assessor may
66.12reclassify the property in the next assessment unless a homestead application is filed to
66.13verify that the property continues to qualify for homestead classification.
66.14    (b) For purposes of this section, homestead property shall include property which
66.15is used for purposes of the homestead but is separated from the homestead by a road,
66.16street, lot, waterway, or other similar intervening property. The term "used for purposes
66.17of the homestead" shall include but not be limited to uses for gardens, garages, or other
66.18outbuildings commonly associated with a homestead, but shall not include vacant land
66.19held primarily for future development. In order to receive homestead treatment for
66.20the noncontiguous property, the owner must use the property for the purposes of the
66.21homestead, and must apply to the assessor, both by the deadlines given in subdivision
66.229. After initial qualification for the homestead treatment, additional applications for
66.23subsequent years are not required.
66.24    (c) Residential real estate that is occupied and used for purposes of a homestead by a
66.25relative of the owner is a homestead but only to the extent of the homestead treatment
66.26that would be provided if the related owner occupied the property. For purposes of this
66.27paragraph and paragraph (g), "relative" means a parent, stepparent, child, stepchild,
66.28grandparent, grandchild, brother, sister, uncle, aunt, nephew, or niece. This relationship
66.29may be by blood or marriage. Property that has been classified as seasonal residential
66.30recreational property at any time during which it has been owned by the current owner or
66.31spouse of the current owner will not be reclassified as a homestead unless it is occupied as
66.32a homestead by the owner; this prohibition also applies to property that, in the absence of
66.33this paragraph, would have been classified as seasonal residential recreational property at
66.34the time when the residence was constructed. Neither the related occupant nor the owner
66.35of the property may claim a property tax refund under chapter 290A for a homestead
66.36occupied by a relative. In the case of a residence located on agricultural land, only the
67.1house, garage, and immediately surrounding one acre of land shall be classified as a
67.2homestead under this paragraph, except as provided in paragraph (d).
67.3    (d) Agricultural property that is occupied and used for purposes of a homestead by
67.4a relative of the owner, is a homestead, only to the extent of the homestead treatment
67.5that would be provided if the related owner occupied the property, and only if all of the
67.6following criteria are met:
67.7    (1) the relative who is occupying the agricultural property is a son, daughter, brother,
67.8sister, grandson, granddaughter, father, or mother of the owner of the agricultural property
67.9or a son, daughter, brother, sister, grandson, or granddaughter of the spouse of the owner
67.10of the agricultural property;
67.11    (2) the owner of the agricultural property must be a Minnesota resident;
67.12    (3) the owner of the agricultural property must not receive homestead treatment on
67.13any other agricultural property in Minnesota; and
67.14    (4) the owner of the agricultural property is limited to only one agricultural
67.15homestead per family under this paragraph.
67.16    Neither the related occupant nor the owner of the property may claim a property
67.17tax refund under chapter 290A for a homestead occupied by a relative qualifying under
67.18this paragraph. For purposes of this paragraph, "agricultural property" means the house,
67.19garage, other farm buildings and structures, and agricultural land.
67.20    Application must be made to the assessor by the owner of the agricultural property to
67.21receive homestead benefits under this paragraph. The assessor may require the necessary
67.22proof that the requirements under this paragraph have been met.
67.23    (e) In the case of property owned by a property owner who is married, the assessor
67.24must not deny homestead treatment in whole or in part if only one of the spouses occupies
67.25the property and the other spouse is absent due to: (1) marriage dissolution proceedings,
67.26(2) legal separation, (3) employment or self-employment in another location, or (4) other
67.27personal circumstances causing the spouses to live separately, not including an intent to
67.28obtain two homestead classifications for property tax purposes. To qualify under clause
67.29(3), the spouse's place of employment or self-employment must be at least 50 miles distant
67.30from the other spouse's place of employment, and the homesteads must be at least 50 miles
67.31distant from each other. Homestead treatment, in whole or in part, shall not be denied to
67.32the owner's spouse who previously occupied the residence with the owner if the absence
67.33of the owner is due to one of the exceptions provided in this paragraph.
67.34    (f) The assessor must not deny homestead treatment in whole or in part if:
67.35    (1) in the case of a property owner who is not married, the owner is absent due to
67.36residence in a nursing home, boarding care facility, or an elderly assisted living facility
68.1property as defined in section 273.13, subdivision 25a, and the property is not otherwise
68.2occupied; or
68.3    (2) in the case of a property owner who is married, the owner or the owner's spouse
68.4or both are absent due to residence in a nursing home, boarding care facility, or an elderly
68.5assisted living facility property as defined in section 273.13, subdivision 25a, and the
68.6property is not occupied or is occupied only by the owner's spouse.
68.7    (g) If an individual is purchasing property with the intent of claiming it as a
68.8homestead and is required by the terms of the financing agreement to have a relative
68.9shown on the deed as a co-owner, the assessor shall allow a full homestead classification.
68.10This provision only applies to first-time purchasers, whether married or single, or to a
68.11person who had previously been married and is purchasing as a single individual for the
68.12first time. The application for homestead benefits must be on a form prescribed by the
68.13commissioner and must contain the data necessary for the assessor to determine if full
68.14homestead benefits are warranted.
68.15    (h) If residential or agricultural real estate is occupied and used for purposes of a
68.16homestead by a child of a deceased owner and the property is subject to jurisdiction of
68.17probate court, the child shall receive relative homestead classification under paragraph (c)
68.18or (d) to the same extent they would be entitled to it if the owner was still living, until
68.19the probate is completed. For purposes of this paragraph, "child" includes a relationship
68.20by blood or by marriage.
68.21    (i) If a single-family home, duplex, or triplex classified as either residential
68.22homestead or agricultural homestead is also used to provide licensed child care, the
68.23portion of the property used for licensed child care must be classified as a part of the
68.24homestead property.
68.25EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
68.26thereafter.

68.27    Sec. 22. Minnesota Statutes 2007 Supplement, section 273.124, subdivision 14,
68.28is amended to read:
68.29    Subd. 14. Agricultural homesteads; special provisions. (a) Real estate of less than
68.30ten acres that is the homestead of its owner must be classified as class 2a under section
68.31273.13, subdivision 23 , paragraph (a), if:
68.32    (1) the parcel on which the house is located is contiguous on at least two sides to (i)
68.33agricultural land, (ii) land owned or administered by the United States Fish and Wildlife
68.34Service, or (iii) land administered by the Department of Natural Resources on which in
68.35lieu taxes are paid under sections 477A.11 to 477A.14;
69.1    (2) its owner also owns a noncontiguous parcel of agricultural land that is at least
69.220 acres;
69.3    (3) the noncontiguous land is located not farther than four townships or cities, or a
69.4combination of townships or cities from the homestead; and
69.5    (4) the agricultural use value of the noncontiguous land and farm buildings is equal
69.6to at least 50 percent of the market value of the house, garage, and one acre of land.
69.7    Homesteads initially classified as class 2a under the provisions of this paragraph shall
69.8remain classified as class 2a, irrespective of subsequent changes in the use of adjoining
69.9properties, as long as the homestead remains under the same ownership, the owner owns a
69.10noncontiguous parcel of agricultural land that is at least 20 acres, and the agricultural use
69.11value qualifies under clause (4). Homestead classification under this paragraph is limited
69.12to property that qualified under this paragraph for the 1998 assessment.
69.13    (b)(i) Agricultural property consisting of at least 40 acres shall be classified as the
69.14owner's homestead, to the same extent as other agricultural homestead property, if all
69.15of the following criteria are met:
69.16    (1) the owner, the owner's spouse, the son or daughter of the owner or owner's
69.17spouse, the brother or sister of the owner or owner's spouse, or the grandson or
69.18granddaughter of the owner or the owner's spouse, is actively farming the agricultural
69.19property, either on the person's own behalf as an individual or on behalf of a partnership
69.20operating a family farm, family farm corporation, joint family farm venture, or limited
69.21liability company of which the person is a partner, shareholder, or member;
69.22    (2) both the owner of the agricultural property and the person who is actively
69.23farming the agricultural property under clause (1), are Minnesota residents;
69.24    (3) neither the owner nor the spouse of the owner claims another agricultural
69.25homestead in Minnesota; and
69.26    (4) neither the owner nor and the person actively farming the property lives farther
69.27than four townships or cities, or a combination of four townships or cities, from the
69.28agricultural property, must live either in the county where the agricultural property is
69.29located or in a county contiguous to the county where the agricultural property is located,
69.30except that if the owner or the owner's spouse is required to live in employer-provided
69.31housing, the owner or owner's spouse, whichever is actively farming the agricultural
69.32property, may live more than four townships or cities, or combination of four townships
69.33or cities further from the agricultural property than in the county or county contiguous
69.34to the property.
69.35    The relationship under this paragraph may be either by blood or marriage.
70.1    (ii) Real property held by a trustee under a trust is eligible for agricultural homestead
70.2classification under this paragraph if the qualifications in clause (i) are met, except that
70.3"owner" means the grantor of the trust.
70.4    (iii) Property containing the residence of an owner who owns qualified property
70.5under clause (i) shall be classified as part of the owner's agricultural homestead, if that
70.6property is also used for noncommercial storage or drying of agricultural crops.
70.7    (c) Noncontiguous land shall be included as part of a homestead under section
70.8273.13, subdivision 23 , paragraph (a), only if the homestead is classified as class 2a
70.9and the detached land is located in the same township or city, or not farther than four
70.10townships or cities or combination thereof from county or in a county contiguous to the
70.11homestead. Any taxpayer of these noncontiguous lands must notify the county assessor
70.12that the noncontiguous land is part of the taxpayer's homestead, and, if the homestead is
70.13located in another county, the taxpayer must also notify the assessor of the other county.
70.14    (d) Agricultural land used for purposes of a homestead and actively farmed by a
70.15person holding a vested remainder interest in it must be classified as a homestead under
70.16section 273.13, subdivision 23, paragraph (a). If agricultural land is classified class 2a,
70.17any other dwellings on the land used for purposes of a homestead by persons holding
70.18vested remainder interests who are actively engaged in farming the property, and up to
70.19one acre of the land surrounding each homestead and reasonably necessary for the use of
70.20the dwelling as a home, must also be assessed class 2a.
70.21    (e) Agricultural land and buildings that were class 2a homestead property under
70.22section 273.13, subdivision 23, paragraph (a), for the 1997 assessment shall remain
70.23classified as agricultural homesteads for subsequent assessments if:
70.24    (1) the property owner abandoned the homestead dwelling located on the agricultural
70.25homestead as a result of the April 1997 floods;
70.26    (2) the property is located in the county of Polk, Clay, Kittson, Marshall, Norman,
70.27or Wilkin;
70.28    (3) the agricultural land and buildings remain under the same ownership for the
70.29current assessment year as existed for the 1997 assessment year and continue to be used
70.30for agricultural purposes;
70.31    (4) the dwelling occupied by the owner is located in Minnesota and is within 30
70.32miles of one of the parcels of agricultural land that is owned by the taxpayer; and
70.33    (5) the owner notifies the county assessor that the relocation was due to the 1997
70.34floods, and the owner furnishes the assessor any information deemed necessary by the
70.35assessor in verifying the change in dwelling. Further notifications to the assessor are not
71.1required if the property continues to meet all the requirements in this paragraph and any
71.2dwellings on the agricultural land remain uninhabited.
71.3    (f) Agricultural land and buildings that were class 2a homestead property under
71.4section 273.13, subdivision 23, paragraph (a), for the 1998 assessment shall remain
71.5classified agricultural homesteads for subsequent assessments if:
71.6    (1) the property owner abandoned the homestead dwelling located on the agricultural
71.7homestead as a result of damage caused by a March 29, 1998, tornado;
71.8    (2) the property is located in the county of Blue Earth, Brown, Cottonwood,
71.9LeSueur, Nicollet, Nobles, or Rice;
71.10    (3) the agricultural land and buildings remain under the same ownership for the
71.11current assessment year as existed for the 1998 assessment year;
71.12    (4) the dwelling occupied by the owner is located in this state and is within 50 miles
71.13of one of the parcels of agricultural land that is owned by the taxpayer; and
71.14    (5) the owner notifies the county assessor that the relocation was due to a March 29,
71.151998, tornado, and the owner furnishes the assessor any information deemed necessary by
71.16the assessor in verifying the change in homestead dwelling. For taxes payable in 1999, the
71.17owner must notify the assessor by December 1, 1998. Further notifications to the assessor
71.18are not required if the property continues to meet all the requirements in this paragraph
71.19and any dwellings on the agricultural land remain uninhabited.
71.20    (g) Agricultural property consisting of at least 40 acres of a family farm corporation,
71.21joint family farm venture, family farm limited liability company, or partnership operating
71.22a family farm as described under subdivision 8 shall be classified homestead, to the same
71.23extent as other agricultural homestead property, if all of the following criteria are met:
71.24    (1) a shareholder, member, or partner of that entity is actively farming the
71.25agricultural property;
71.26    (2) that shareholder, member, or partner who is actively farming the agricultural
71.27property is a Minnesota resident;
71.28    (3) neither that shareholder, member, or partner, nor the spouse of that shareholder,
71.29member, or partner claims another agricultural homestead in Minnesota; and
71.30    (4) that shareholder, member, or partner does not live farther than four townships
71.31or cities, or a combination of four townships or cities, from the agricultural property
71.32lives in the county where the agricultural property is located or in a county contiguous to
71.33the county where the property is located.
71.34    Homestead treatment applies under this paragraph for property leased to a family
71.35farm corporation, joint farm venture, limited liability company, or partnership operating a
72.1family farm if legal title to the property is in the name of an individual who is a member,
72.2shareholder, or partner in the entity.
72.3    (h) To be eligible for the special agricultural homestead under this subdivision, an
72.4initial full application must be submitted to the county assessor where the property is
72.5located. Owners and the persons who are actively farming the property shall be required
72.6to complete only a one-page abbreviated version of the application in each subsequent
72.7year provided that none of the following items have changed since the initial application:
72.8    (1) the day-to-day operation, administration, and financial risks remain the same;
72.9    (2) the owners and the persons actively farming the property continue to live within
72.10the four townships or city criteria the county or a contiguous county and are Minnesota
72.11residents;
72.12    (3) the same operator of the agricultural property is listed with the Farm Service
72.13Agency;
72.14    (4) a Schedule F or equivalent income tax form was filed for the most recent year;
72.15    (5) the property's acreage is unchanged; and
72.16    (6) none of the property's acres have been enrolled in a federal or state farm program
72.17since the initial application.
72.18    The owners and any persons who are actively farming the property must include
72.19the appropriate Social Security numbers, and sign and date the application. If any of the
72.20specified information has changed since the full application was filed, the owner must
72.21notify the assessor, and must complete a new application to determine if the property
72.22continues to qualify for the special agricultural homestead. The commissioner of revenue
72.23shall prepare a standard reapplication form for use by the assessors.
72.24    (i) Agricultural land and buildings that were class 2a homestead property under
72.25section 273.13, subdivision 23, paragraph (a), for the 2007 assessment shall remain
72.26classified agricultural homesteads for subsequent assessments if:
72.27    (1) the property owner abandoned the homestead dwelling located on the agricultural
72.28homestead as a result of damage caused by the August 2007 floods;
72.29    (2) the property is located in the county of Dodge, Fillmore, Houston, Olmsted,
72.30Steele, Wabasha, or Winona;
72.31    (3) the agricultural land and buildings remain under the same ownership for the
72.32current assessment year as existed for the 2007 assessment year;
72.33    (4) the dwelling occupied by the owner is located in this state and is within 50 miles
72.34of one of the parcels of agricultural land that is owned by the taxpayer; and
72.35    (5) the owner notifies the county assessor that the relocation was due to the August
72.362007 floods, and the owner furnishes the assessor any information deemed necessary by
73.1the assessor in verifying the change in homestead dwelling. For taxes payable in 2009, the
73.2owner must notify the assessor by December 1, 2008. Further notifications to the assessor
73.3are not required if the property continues to meet all the requirements in this paragraph
73.4and any dwellings on the agricultural land remain uninhabited.
73.5EFFECTIVE DATE.This section is effective for taxes payable in 2010 and
73.6thereafter, except that the provision extending the homestead to brothers and sisters is
73.7effective for taxes payable in 2009 and thereafter.

73.8    Sec. 23. Minnesota Statutes 2006, section 273.13, subdivision 23, as amended by Laws
73.92008, chapter 154, article 2, section 12, is amended to read:
73.10    Subd. 23. Class 2. (a) Class 2a property is agricultural land including any
73.11improvements An agricultural homestead consists of class 2a agricultural land that is
73.12homesteaded, along with any class 2b rural vacant land that is contiguous to the class 2a
73.13land. The market value of the house and garage and immediately surrounding one acre
73.14of land has the same class rates as class 1a or 1b property under subdivision 22. The
73.15value of the remaining land including improvements up to the first tier valuation limit of
73.16agricultural homestead property has a net class rate of 0.55 0.5 percent of market value.
73.17The remaining property over the first tier has a class rate of one percent of market value.
73.18For purposes of this subdivision, the "first tier valuation limit of agricultural homestead
73.19property" and "first tier" means the limit certified under section 273.11, subdivision 23.
73.20    (b) Class 2a agricultural land consists of parcels of property, or portions thereof,
73.21that are agricultural land and buildings. Class 2a property has a net class rate of one
73.22percent of market value, unless it is part of an agricultural homestead under paragraph
73.23(a). Class 2a property may contain an incidental amount of property that would otherwise
73.24be classified as 2b, including but not limited to sloughs, wooded wind shelters, acreage
73.25abutting ditches, and other similar land impractical for the assessor to value separately
73.26from the rest of the property.
73.27    (c) Class 2b property is (1) rural vacant land consists of parcels of property,
73.28or portions thereof, that are unplatted real estate, rural in character and not used for
73.29agricultural purposes, including land used exclusively for growing trees for timber,
73.30lumber, and wood and wood products; (2) real estate that is not improved with a structure
73.31and is used exclusively for growing trees for timber, lumber, and wood and wood products,
73.32if the owner has participated or is participating in a cost-sharing program for afforestation,
73.33reforestation, or timber stand improvement on that particular property, administered or
73.34coordinated by the commissioner of natural resources; (3) real estate that is nonhomestead
73.35agricultural land; or (4) a landing area or public access area of a privately owned public use
74.1airport, provided that the presence of a minor, ancillary nonresidential structure as defined
74.2by the commissioner of revenue does not disqualify the property from classification
74.3under this paragraph and provided that any parcel improved with a structure that is not a
74.4minor, ancillary nonresidential structure may be split-classified, provided that the acreage
74.5assigned to the split parcel with the structure is at least 20 acres. Class 2b property has
74.6a net class rate of one percent of market value, except that unplatted property described
74.7in clause (1) or (2) has a net class rate of .65 percent if it consists unless it is part of an
74.8agricultural homestead under paragraph (a), or qualifies as class 2c under paragraph (d).
74.9    (d) Class 2c managed forest land consists of no less than ten 20 and no more than
74.101,920 acres and statewide per taxpayer that is being managed under a forest management
74.11plan that meets the requirements of chapter 290C, but is not enrolled in the sustainable
74.12forest resource management incentive program. It has a class rate of .65 percent, provided
74.13that the owner of the property must apply to the assessor annually to receive the reduced
74.14class rate and provide the information required by the assessor to verify that the property
74.15qualifies for the reduced rate. The commissioner of natural resources must concur that the
74.16land is qualified. The commissioner of natural resources shall annually provide county
74.17assessors verification information on a timely basis.
74.18    (c) (e) Agricultural land as used in this section means contiguous acreage of
74.19ten acres or more, property used during the preceding year for agricultural purposes.
74.20"Agricultural purposes" as used in this section means the raising or, cultivation, drying,
74.21or storage of agricultural products for sale, or the storage of machinery or equipment
74.22used in support of agricultural production. For a property to be classified as agricultural
74.23based only on the drying or storage of agricultural products, the products being dried or
74.24stored must have been produced by the same farm entity as the entity operating the drying
74.25or storage facility. "Agricultural purposes" also includes enrollment in the Reinvest in
74.26Minnesota program under sections 103F.501 to 103F.535 or the federal Conservation
74.27Reserve Program as contained in Public Law 99-198 if the property was classified as
74.28agricultural (i) under this subdivision for the assessment year 2002 or (ii) in the year prior
74.29to its enrollment. Contiguous acreage on the same parcel, or contiguous acreage on an
74.30immediately adjacent parcel under the same ownership, may also qualify as agricultural
74.31land, but only if it is pasture, timber, waste, unusable wild land, or land included in state
74.32or federal farm programs. Agricultural classification for property shall be determined
74.33excluding the house, garage, and immediately surrounding one acre of land, and shall not
74.34be based upon the market value of any residential structures on the parcel or contiguous
74.35parcels under the same ownership.
75.1    (d) (f) Real estate of less than five acres, excluding the house, garage, and
75.2immediately surrounding one acre of land, of less than ten acres which is exclusively and
75.3intensively used for raising or cultivating agricultural products, shall be considered as
75.4agricultural land qualifies as class 2a if:
75.5    (i) the entire parcel is tilled or pastured to produce an agricultural product for sale in
75.6three of the last five years;
75.7    (ii) the acres are used primarily for drying or storage of grain or storage of machinery
75.8or equipment used to support agricultural activities on other parcels of property operated
75.9by the same farming entity;
75.10    (iii) the land mass contains a nursery, provided only those acres used to produce
75.11nursery stock are considered agricultural land;
75.12    (iv) the parcel is used exclusively as a livestock or poultry confinement process; or
75.13    (v) the parcel is used primarily for market farming; for purposes of this paragraph,
75.14"market farming" means the cultivation of one or more fruits or vegetables or production
75.15of animal or other agricultural products for sale to local markets by the farmer or an
75.16organization with which the farmer is affiliated.
75.17    (g) Land shall be classified as agricultural even if all or a portion of the agricultural
75.18use of that property is the leasing to, or use by another person for agricultural purposes.
75.19    Classification under this subdivision is not determinative for qualifying under
75.20section 273.111.
75.21    (h) The property classification under this section supersedes, for property tax
75.22purposes only, any locally administered agricultural policies or land use restrictions that
75.23define minimum or maximum farm acreage.
75.24    (e) (i) The term "agricultural products" as used in this subdivision includes
75.25production for sale of:
75.26    (1) livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing
75.27animals, horticultural and nursery stock, fruit of all kinds, vegetables, forage, grains,
75.28bees, and apiary products by the owner;
75.29    (2) fish bred for sale and consumption if the fish breeding occurs on land zoned
75.30for agricultural use;
75.31    (3) the commercial boarding of horses if the boarding is done in conjunction with
75.32raising or cultivating agricultural products as defined in clause (1);
75.33    (4) property which is owned and operated by nonprofit organizations used for
75.34equestrian activities, excluding racing;
75.35    (5) game birds and waterfowl bred and raised for use on a shooting preserve licensed
75.36under section 97A.115;
76.1    (6) insects primarily bred to be used as food for animals;
76.2    (7) trees, grown for sale as a crop, including short rotation woody crops, and not
76.3sold for timber, lumber, wood, or wood products; and
76.4    (8) maple syrup taken from trees grown by a person licensed by the Minnesota
76.5Department of Agriculture under chapter 28A as a food processor.
76.6    (f) (j) If a parcel used for agricultural purposes is also used for commercial or
76.7industrial purposes, including but not limited to:
76.8    (1) wholesale and retail sales;
76.9    (2) processing of raw agricultural products or other goods;
76.10    (3) warehousing or storage of processed goods; and
76.11    (4) office facilities for the support of the activities enumerated in clauses (1), (2),
76.12and (3),
76.13the assessor shall classify the part of the parcel used for agricultural purposes as class
76.141b, 2a, or 2b, whichever is appropriate, and the remainder in the class appropriate to its
76.15use. The grading, sorting, and packaging of raw agricultural products for first sale is
76.16considered an agricultural purpose. A greenhouse or other building where horticultural
76.17or nursery products are grown that is also used for the conduct of retail sales must be
76.18classified as agricultural if it is primarily used for the growing of horticultural or nursery
76.19products from seed, cuttings, or roots and occasionally as a showroom for the retail sale of
76.20those products. Use of a greenhouse or building only for the display of already grown
76.21horticultural or nursery products does not qualify as an agricultural purpose.
76.22    The assessor shall determine and list separately on the records the market value of
76.23the homestead dwelling and the one acre of land on which that dwelling is located. If any
76.24farm buildings or structures are located on this homesteaded acre of land, their market
76.25value shall not be included in this separate determination.
76.26    (g) (k) Class 2d airport landing area consists of a landing area or public access
76.27area of a privately owned public use airport. To qualify for classification under this
76.28paragraph (b), clause (4), a privately owned public use airport must be licensed as a public
76.29airport under section 360.018. For purposes of this paragraph (b), clause (4), "landing
76.30area" means that part of a privately owned public use airport properly cleared, regularly
76.31maintained, and made available to the public for use by aircraft and includes runways,
76.32taxiways, aprons, and sites upon which are situated landing or navigational aids. A
76.33landing area also includes land underlying both the primary surface and the approach
76.34surfaces that comply with all of the following:
77.1    (i) the land is properly cleared and regularly maintained for the primary purposes of
77.2the landing, taking off, and taxiing of aircraft; but that portion of the land that contains
77.3facilities for servicing, repair, or maintenance of aircraft is not included as a landing area;
77.4    (ii) the land is part of the airport property; and
77.5    (iii) the land is not used for commercial or residential purposes.
77.6The land contained in a landing area under this paragraph (b), clause (4), must be described
77.7and certified by the commissioner of transportation. The certification is effective until it
77.8is modified, or until the airport or landing area no longer meets the requirements of this
77.9paragraph (b), clause (4). For purposes of this paragraph (b), clause (4), "public access
77.10area" means property used as an aircraft parking ramp, apron, or storage hangar, or an
77.11arrival and departure building in connection with the airport.
77.12EFFECTIVE DATE.The portion of this section reducing the agricultural class rate,
77.13and expanding the definition of "agricultural purposes" in paragraph (e) and "agricultural
77.14products" in paragraph (h), is effective for taxes payable in 2009 and thereafter. The
77.15remainder of the section is effective for taxes payable in 2010 and thereafter.

77.16    Sec. 24. Minnesota Statutes 2006, section 273.13, subdivision 24, is amended to read:
77.17    Subd. 24. Class 3. (a) Commercial and industrial property and utility real and
77.18personal property is class 3a.
77.19    (1) Except as otherwise provided, each parcel of commercial, industrial, or utility
77.20real property has a class rate of 1.5 percent of the first tier of market value, and 2.0 percent
77.21of the remaining market value. In the case of contiguous parcels of property owned by the
77.22same person or entity, only the value equal to the first-tier value of the contiguous parcels
77.23qualifies for the reduced class rate, except that contiguous parcels owned by the same
77.24person or entity shall be eligible for the first-tier value class rate on each separate business
77.25operated by the owner of the property, provided the business is housed in a separate
77.26structure. For the purposes of this subdivision, the first tier means the first $150,000 of
77.27market value. Real property owned in fee by a utility for transmission line right-of-way
77.28shall be classified at the class rate for the higher tier.
77.29    For purposes of this subdivision, parcels are considered to be contiguous even if
77.30they are separated from each other by a road, street, waterway, or other similar intervening
77.31type of property. Connections between parcels that consist of power lines or pipelines do
77.32not cause the parcels to be contiguous. Property owners who have contiguous parcels of
77.33property that constitute separate businesses that may qualify for the first-tier class rate shall
77.34notify the assessor by July 1, for treatment beginning in the following taxes payable year.
78.1    (2) All Personal property that is: (i) part of an electric generation, transmission, or
78.2distribution system; or (ii), including tools, implements, and machinery, has a class rate
78.3of 2.4 percent for taxes payable in 2009, and 2.8 percent for taxes payable in 2010 and
78.4thereafter.
78.5    (3) Personal property that is either: (i) part of a pipeline system transporting
78.6or distributing water, gas, crude oil, or petroleum products; and (iii) not described in
78.7clause (3), and all, including tools, implements, and machinery, or (ii) part of an electric
78.8transmission or distribution system, including tools, implements, and machinery, has a
78.9class rate of 2.0 percent for taxes payable in 2009 and thereafter.
78.10    (4) Railroad operating property has a class rate as provided under clause (1) for
78.11the first tier of market value and the remaining market value. In the case of multiple
78.12parcels in one county that are owned by one person or entity, only one first tier amount
78.13is eligible for the reduced rate.
78.14    (3) The entire market value of personal property that is: (i) tools, implements, and
78.15machinery of an electric generation, transmission, or distribution system; (ii) tools,
78.16implements, and machinery of a pipeline system transporting or distributing water, gas,
78.17crude oil, or petroleum products; or (iii) the (5) Personal property consisting of mains
78.18and pipes used in the distribution of steam or hot or chilled water for heating or cooling
78.19buildings, has a class rate as provided under clause (1) for the remaining market value
78.20in excess of the first tier.
78.21    (b) Employment property defined in section 469.166, during the period provided
78.22in section 469.170, shall constitute class 3b. The class rates for class 3b property are
78.23determined under paragraph (a).
78.24EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
78.25thereafter.

78.26    Sec. 25. Minnesota Statutes 2006, section 273.13, subdivision 25, as amended by Laws
78.272008, chapter 154, article 2, section 13, is amended to read:
78.28    Subd. 25. Class 4. (a) Class 4a is residential real estate containing four or more
78.29units and used or held for use by the owner or by the tenants or lessees of the owner
78.30as a residence for rental periods of 30 days or more, excluding property qualifying for
78.31class 4d. Class 4a also includes hospitals licensed under sections 144.50 to 144.56, other
78.32than hospitals exempt under section 272.02, and contiguous property used for hospital
78.33purposes, without regard to whether the property has been platted or subdivided. The
78.34market value of class 4a property has a class rate of 1.25 percent.
78.35    (b) Class 4b includes:
79.1    (1) residential real estate containing less than four units that does not qualify as class
79.24bb, other than seasonal residential recreational property;
79.3    (2) manufactured homes not classified under any other provision;
79.4    (3) a dwelling, garage, and surrounding one acre of property on a nonhomestead
79.5farm classified under subdivision 23, paragraph (b) containing two or three units; and
79.6    (4) is unimproved property that is classified residential as determined under
79.7subdivision 33.
79.8    The market value of class 4b property has a class rate of 1.25 percent.
79.9    (c) Class 4bb includes:
79.10    (1) nonhomestead residential real estate containing one unit up to three units, other
79.11than seasonal residential recreational property; and
79.12    (2) a single family dwelling, garage, and surrounding one acre of property on a
79.13nonhomestead farm classified under subdivision 23, paragraph (b), containing up to three
79.14units; and
79.15    (3) manufactured homes not classified under any other provision.
79.16    Class 4bb property has the same class rates as class 1a property under subdivision 22.
79.17    Property that has been classified as seasonal residential recreational property at
79.18any time during which it has been owned by the current owner or spouse of the current
79.19owner does not qualify for class 4bb.
79.20    (d) Class 4c property includes:
79.21    (1) except as provided in subdivision 22, paragraph (c), or subdivision 23, paragraph
79.22(b), clause (1), real and personal property devoted to temporary and seasonal residential
79.23occupancy for recreation purposes, including real and personal property devoted to
79.24temporary and seasonal residential occupancy for recreation purposes and not devoted to
79.25commercial purposes for more than 250 days in the year preceding the year of assessment.
79.26For purposes of this clause, property is devoted to a commercial purpose on a specific
79.27day if any portion of the property is used for residential occupancy, and a fee is charged
79.28for residential occupancy. Class 4c property must contain three or more rental units. A
79.29"rental unit" is defined as a cabin, condominium, townhouse, sleeping room, or individual
79.30camping site equipped with water and electrical hookups for recreational vehicles. Class
79.314c property must provide recreational activities such as renting ice fishing houses, boats
79.32and motors, snowmobiles, downhill or cross-country ski equipment; provide marina
79.33services, launch services, or guide services; or sell bait and fishing tackle. A camping
79.34pad offered for rent by a property that otherwise qualifies for class 4c is also class 4c
79.35regardless of the term of the rental agreement, as long as the use of the camping pad
79.36does not exceed 250 days. In order for a property to be classified as class 4c, seasonal
80.1residential recreational for commercial purposes, at least 40 percent of the annual gross
80.2lodging receipts related to the property must be from business conducted during 90
80.3consecutive days and either (i) at least 60 percent of all paid bookings by lodging guests
80.4during the year must be for periods of at least two consecutive nights; or (ii) at least 20
80.5percent of the annual gross receipts must be from charges for rental of fish houses, boats
80.6and motors, snowmobiles, downhill or cross-country ski equipment, or charges for marina
80.7services, launch services, and guide services, or the sale of bait and fishing tackle. For
80.8purposes of this determination, a paid booking of five or more nights shall be counted as
80.9two bookings. Class 4c also includes commercial use real property used exclusively
80.10for recreational purposes in conjunction with class 4c property devoted to temporary
80.11and seasonal residential occupancy for recreational purposes, up to a total of two acres,
80.12provided the property is not devoted to commercial recreational use for more than 250
80.13days in the year preceding the year of assessment and is located within two miles of the
80.14class 4c property with which it is used. Owners of real and personal property devoted
80.15to temporary and seasonal residential occupancy for recreation purposes and all or a
80.16portion of which was devoted to commercial purposes for not more than 250 days in the
80.17year preceding the year of assessment desiring classification as class 4c, must submit a
80.18declaration to the assessor designating the cabins or units occupied for 250 days or less in
80.19the year preceding the year of assessment by January 15 of the assessment year. Those
80.20cabins or units and a proportionate share of the land on which they are located must be
80.21designated class 4c as otherwise provided. The remainder of the cabins or units and
80.22a proportionate share of the land on which they are located will be designated as class
80.233a. The owner of property desiring designation as class 4c property must provide guest
80.24registers or other records demonstrating that the units for which class 4c designation is
80.25sought were not occupied for more than 250 days in the year preceding the assessment if
80.26so requested. The portion of a property operated as a (1) restaurant, (2) bar, (3) gift shop,
80.27(4) conference center or meeting room, and (5) other nonresidential facility operated on a
80.28commercial basis not directly related to temporary and seasonal residential occupancy for
80.29recreation purposes does not qualify for class 4c;
80.30    (2) qualified property used as a golf course if:
80.31    (i) it is open to the public on a daily fee basis. It may charge membership fees or
80.32dues, but a membership fee may not be required in order to use the property for golfing,
80.33and its green fees for golfing must be comparable to green fees typically charged by
80.34municipal courses; and
80.35    (ii) it meets the requirements of section 273.112, subdivision 3, paragraph (d).
81.1    A structure used as a clubhouse, restaurant, or place of refreshment in conjunction
81.2with the golf course is classified as class 3a property;
81.3    (3) real property up to a maximum of three acres of land owned and used by a
81.4nonprofit community service oriented organization and that is not used for residential
81.5purposes on either a temporary or permanent basis, qualifies for class 4c provided that
81.6it meets either of the following:
81.7    (i) the property is not used for a revenue-producing activity for more than six days
81.8in the calendar year preceding the year of assessment; or
81.9    (ii) the organization makes annual charitable contributions and donations at least
81.10equal to the property's previous year's property taxes and the property is allowed to be
81.11used for public and community meetings or events for no charge, as appropriate to the
81.12size of the facility.
81.13    For purposes of this clause,
81.14    (A) "charitable contributions and donations" has the same meaning as lawful
81.15gambling purposes under section 349.12, subdivision 25, excluding those purposes
81.16relating to the payment of taxes, assessments, fees, auditing costs, and utility payments;
81.17    (B) "property taxes" excludes the state general tax;
81.18    (C) a "nonprofit community service oriented organization" means any corporation,
81.19society, association, foundation, or institution organized and operated exclusively for
81.20charitable, religious, fraternal, civic, or educational purposes, and which is exempt from
81.21federal income taxation pursuant to section 501(c)(3), (10), or (19) of the Internal Revenue
81.22Code of 1986, as amended through December 31, 1990; and
81.23    (D) "revenue-producing activities" shall include but not be limited to property or that
81.24portion of the property that is used as an on-sale intoxicating liquor or 3.2 percent malt
81.25liquor establishment licensed under chapter 340A, a restaurant open to the public, bowling
81.26alley, a retail store, gambling conducted by organizations licensed under chapter 349, an
81.27insurance business, or office or other space leased or rented to a lessee who conducts a
81.28for-profit enterprise on the premises.
81.29Any portion of the property qualifying under item (i) which is used for revenue-producing
81.30activities for more than six days in the calendar year preceding the year of assessment
81.31shall be assessed as class 3a. The use of the property for social events open exclusively
81.32to members and their guests for periods of less than 24 hours, when an admission is
81.33not charged nor any revenues are received by the organization shall not be considered a
81.34revenue-producing activity.
81.35    The organization shall maintain records of its charitable contributions and donations
81.36and of public meetings and events held on the property and make them available upon
82.1request any time to the assessor to ensure eligibility. An organization meeting the
82.2requirement under item (ii) must file an application by May 1 with the assessor for
82.3eligibility for the current year's assessment. The commissioner shall prescribe a uniform
82.4application form and instructions;
82.5    (4) postsecondary student housing of not more than one acre of land that is owned by
82.6a nonprofit corporation organized under chapter 317A and is used exclusively by a student
82.7cooperative, sorority, or fraternity for on-campus housing or housing located within two
82.8miles of the border of a college campus;
82.9    (5) manufactured home parks as defined in section 327.14, subdivision 3;
82.10    (6) real property that is actively and exclusively devoted to indoor fitness, health,
82.11social, recreational, and related uses, is owned and operated by a not-for-profit corporation,
82.12and is located within the metropolitan area as defined in section 473.121, subdivision 2;
82.13    (7) a leased or privately owned noncommercial aircraft storage hangar not exempt
82.14under section 272.01, subdivision 2, and the land on which it is located, provided that:
82.15    (i) the land is on an airport owned or operated by a city, town, county, Metropolitan
82.16Airports Commission, or group thereof; and
82.17    (ii) the land lease, or any ordinance or signed agreement restricting the use of the
82.18leased premise, prohibits commercial activity performed at the hangar.
82.19    If a hangar classified under this clause is sold after June 30, 2000, a bill of sale must
82.20be filed by the new owner with the assessor of the county where the property is located
82.21within 60 days of the sale;
82.22    (8) a privately owned noncommercial aircraft storage hangar not exempt under
82.23section 272.01, subdivision 2, and the land on which it is located, provided that:
82.24    (i) the land abuts a public airport; and
82.25    (ii) the owner of the aircraft storage hangar provides the assessor with a signed
82.26agreement restricting the use of the premises, prohibiting commercial use or activity
82.27performed at the hangar; and
82.28    (9) residential real estate, a portion of which is used by the owner for homestead
82.29purposes, and that is also a place of lodging, if all of the following criteria are met:
82.30    (i) rooms are provided for rent to transient guests that generally stay for periods
82.31of 14 or fewer days;
82.32    (ii) meals are provided to persons who rent rooms, the cost of which is incorporated
82.33in the basic room rate;
82.34    (iii) meals are not provided to the general public except for special events on fewer
82.35than seven days in the calendar year preceding the year of the assessment; and
82.36    (iv) the owner is the operator of the property.
83.1The market value subject to the 4c classification under this clause is limited to five rental
83.2units. Any rental units on the property in excess of five, must be valued and assessed as
83.3class 3a. The portion of the property used for purposes of a homestead by the owner must
83.4be classified as class 1a property under subdivision 22.
83.5    Class 4c property has a class rate of 1.5 percent of market value, except that (i) each
83.6parcel of seasonal residential recreational property not used for commercial purposes has
83.7the same class rates as class 4bb property, (ii) manufactured home parks assessed under
83.8clause (5) have the same class rate as class 4b property, (iii) commercial-use seasonal
83.9residential recreational property has a class rate of one percent for the first $500,000 of
83.10market value, and 1.25 percent for the remaining market value, (iv) the market value of
83.11property described in clause (4) has a class rate of one percent, (v) the market value of
83.12property described in clauses (2) and (6) has a class rate of 1.25 percent, and (vi) that
83.13portion of the market value of property in clause (9) qualifying for class 4c property
83.14has a class rate of 1.25 percent.
83.15    (e) Class 4d property is qualifying low-income rental housing certified to the assessor
83.16by the Housing Finance Agency under section 273.128, subdivision 3. If only a portion
83.17of the units in the building qualify as low-income rental housing units as certified under
83.18section 273.128, subdivision 3, only the proportion of qualifying units to the total number
83.19of units in the building qualify for class 4d. The remaining portion of the building shall be
83.20classified by the assessor based upon its use. Class 4d also includes the same proportion of
83.21land as the qualifying low-income rental housing units are to the total units in the building.
83.22For all properties qualifying as class 4d, the market value determined by the assessor must
83.23be based on the normal approach to value using normal unrestricted rents.
83.24    Class 4d property has a class rate of 0.75 percent.
83.25EFFECTIVE DATE.This section is effective for assessment year 2008 and
83.26thereafter, and for taxes payable in 2009 and thereafter.

83.27    Sec. 26. Minnesota Statutes 2006, section 273.13, subdivision 33, is amended to read:
83.28    Subd. 33. Classification of unimproved property. (a) All real property that is not
83.29improved with a structure must be classified according to its current use.
83.30    (b) Except as provided in subdivision 23, paragraph (c), real property that is not
83.31improved with a structure and for which there is no identifiable current use must be
83.32classified according to its highest and best use permitted under the local zoning ordinance.
83.33If the ordinance permits more than one use, the land must be classified according to the
83.34highest and best use permitted under the ordinance. If no such ordinance exists, the
84.1assessor shall consider the most likely potential use of the unimproved land based upon
84.2the use made of surrounding land or land in proximity to the unimproved land.
84.3EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
84.4thereafter.

84.5    Sec. 27. [273.1388] PROPERTY TAX CREDIT FOR LEASED LAND.
84.6    Noncommercial seasonal residential recreational property located on land leased
84.7from a governmental unit or agency is eligible for a property tax credit equal to 25 percent
84.8of the annual lease payment. Eligible taxpayers must file an application with the county
84.9auditor prior to November 1 of the year in which the property taxes are payable. The
84.10application shall be on a form prescribed by the commissioner of revenue, and must
84.11include such evidence as the county deems necessary of the annual lease payment for the
84.12period corresponding to the taxes payable year. The county may either pay the credit
84.13directly to the property owner or subtract it as a credit on the property tax statement,
84.14whichever it considers to be more administratively cost-efficient. If the county makes a
84.15direct payment of the credit to the property owner, the county must pay the credit by
84.16August 1 of the year in which the taxes are payable or within 45 days of receipt of the
84.17application, whichever is later.
84.18EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
84.19thereafter.

84.20    Sec. 28. Minnesota Statutes 2007 Supplement, section 273.1393, is amended to read:
84.21273.1393 COMPUTATION OF NET PROPERTY TAXES.
84.22    Notwithstanding any other provisions to the contrary, "net" property taxes are
84.23determined by subtracting the credits in the order listed from the gross tax:
84.24    (1) disaster credit as provided in sections 273.1231 to 273.1235;
84.25    (2) powerline credit as provided in section 273.42;
84.26    (3) agricultural preserves credit as provided in section 473H.10;
84.27    (4) enterprise zone credit as provided in section 469.171;
84.28    (5) disparity reduction credit;
84.29    (6) conservation tax credit as provided in section 273.119;
84.30    (7) homestead and agricultural credits as provided in section 273.1384;
84.31    (8) taconite homestead credit as provided in section 273.135; and
84.32    (9) supplemental homestead credit as provided in section 273.1391; and
84.33    (10) bovine tuberculosis management credit as provided in section 273.113.
84.34    The combination of all property tax credits must not exceed the gross tax amount.
85.1EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
85.2thereafter.

85.3    Sec. 29. Minnesota Statutes 2006, section 274.14, is amended to read:
85.4274.14 LENGTH OF SESSION; RECORD.
85.5    The board may meet on any ten consecutive meeting days in June, after the second
85.6Friday in June. The actual meeting dates must be contained on the valuation notices
85.7mailed to each property owner in the county as provided in section 273.121. For this
85.8purpose, "meeting days" is defined as any day of the week excluding Saturday and Sunday.
85.9At the board's discretion, "meeting days" may include Saturday. No action taken by the
85.10county board of review after June 30 is valid, except for corrections permitted in sections
85.11273.01 and 274.01. The county auditor shall keep an accurate record of the proceedings
85.12and orders of the board. The record must be published like other proceedings of county
85.13commissioners. A copy of the published record must be sent to the commissioner of
85.14revenue, with the abstract of assessment required by section 274.16.
85.15    For counties that conduct either regular board of review meetings or open book
85.16meetings, at least one of the meeting days must include a meeting that does not end
85.17before 7:00 p.m. For counties that require taxpayer appointments for the board of review,
85.18appointments must include some available times that extend until at least 7:00 p.m. The
85.19county may have a Saturday meeting in lieu of, or in addition to, the extended meeting
85.20times under this paragraph.

85.21    Sec. 30. Minnesota Statutes 2006, section 275.025, subdivision 1, is amended to read:
85.22    Subdivision 1. Levy amount. The state general levy is levied against
85.23commercial-industrial property and seasonal residential recreational property, as defined
85.24in this section. The state general levy base amount is $592,000,000 for taxes payable in
85.252002. For taxes payable in subsequent years, the levy base amount is increased each year
85.26by multiplying the levy base amount for the prior year by the sum of one plus the rate of
85.27increase, if any, in the implicit price deflator for government consumption expenditures
85.28and gross investment for state and local governments prepared by the Bureau of Economic
85.29Analysts of the United States Department of Commerce for the 12-month period ending
85.30March 31 of the year prior to the year the taxes are payable. The tax under this section is
85.31not treated as a local tax rate under section 469.177 and is not the levy of a governmental
85.32unit under chapters 276A and 473F.
85.33    In setting the rate, the commissioner shall exclude the tax capacity of property
85.34described in section 473.625 from the tax base. The commissioner shall increase or
85.35decrease the preliminary or final rate for a year as necessary to account for errors and tax
86.1base changes that affected a preliminary or final rate for either of the two preceding years.
86.2Adjustments are allowed to the extent that the necessary information is available to the
86.3commissioner at the time the rates for a year must be certified, and for the following
86.4reasons:
86.5    (1) an erroneous report of taxable value by a local official;
86.6    (2) an erroneous calculation by the commissioner; and
86.7    (3) an increase or decrease in taxable value for commercial-industrial or seasonal
86.8residential recreational property reported on the abstracts of tax lists submitted under
86.9section 275.29 that was not reported on the abstracts of assessment submitted under
86.10section 270C.89 for the same year.
86.11The commissioner may, but need not, make adjustments if the total difference in the tax
86.12levied for the year would be less than $100,000.
86.13EFFECTIVE DATE.This section is effective beginning for property taxes payable
86.14in 2009.

86.15    Sec. 31. Minnesota Statutes 2006, section 275.025, subdivision 2, is amended to read:
86.16    Subd. 2. Commercial-industrial tax capacity. For the purposes of this section,
86.17"commercial-industrial tax capacity" means the tax capacity of all taxable property
86.18classified as class 3 or class 5(1) under section 273.13, except for electric generation
86.19attached machinery under class 3 and property described in section 473.625. County
86.20commercial-industrial tax capacity amounts are not adjusted for the captured net tax
86.21capacity of a tax increment financing district under section 469.177, subdivision 2, the
86.22net tax capacity of transmission lines deducted from a local government's total net tax
86.23capacity under section 273.425, or fiscal disparities contribution and distribution net
86.24tax capacities under chapter 276A or 473F.
86.25EFFECTIVE DATE.This section is effective beginning for taxes payable in 2009.

86.26    Sec. 32. Minnesota Statutes 2007 Supplement, section 275.065, subdivision 1, is
86.27amended to read:
86.28    Subdivision 1. Proposed levy. (a) Notwithstanding any law or charter to the
86.29contrary, on or before September 15 1, each taxing authority, other than a school district,
86.30shall adopt a proposed budget and shall certify to the county auditor the proposed or, in
86.31the case of a town, the final property tax levy for taxes payable in the following year.
86.32    (b) On or before September 30 15, each school district that has not mutually agreed
86.33with its home county to extend this date shall certify to the county auditor the proposed
86.34property tax levy for taxes payable in the following year. Each school district that has
87.1agreed with its home county to delay the certification of its proposed property tax levy
87.2must certify its proposed property tax levy for the following year no later than October 7
87.3September 22. The school district shall certify the proposed levy as:
87.4    (1) a specific dollar amount by school district fund, broken down between
87.5voter-approved and non-voter-approved levies and between referendum market value
87.6and tax capacity levies; or
87.7    (2) the maximum levy limitation certified by the commissioner of education
87.8according to section 126C.48, subdivision 1.
87.9    (c) If the board of estimate and taxation or any similar board that establishes
87.10maximum tax levies for taxing jurisdictions within a first class city certifies the maximum
87.11property tax levies for funds under its jurisdiction by charter to the county auditor by
87.12September 15 1, the city shall be deemed to have certified its levies for those taxing
87.13jurisdictions.
87.14    (d) For purposes of this section, "taxing authority" includes all home rule and
87.15statutory cities, towns, counties, school districts, and special taxing districts as defined
87.16in section 275.066. Intermediate school districts that levy a tax under chapter 124 or
87.17136D, joint powers boards established under sections 123A.44 to 123A.446, and Common
87.18School Districts No. 323, Franconia, and No. 815, Prinsburg, are also special taxing
87.19districts for purposes of this section.
87.20EFFECTIVE DATE.This section is effective for proposed notices and hearings
87.21held in 2009 and thereafter, for property taxes payable in 2010 and thereafter.

87.22    Sec. 33. Minnesota Statutes 2007 Supplement, section 275.065, subdivision 1a,
87.23is amended to read:
87.24    Subd. 1a. Overlapping jurisdictions. In the case of a taxing authority lying in two
87.25or more counties, the home county auditor shall certify the proposed levy and the proposed
87.26local tax rate to the other county auditor by October 5, unless the home county has agreed
87.27to delay the certification of its proposed property tax levy, in which case the home county
87.28auditor shall certify the proposed levy and the proposed local tax rate to the other county
87.29auditor by October 10 September 5. The home county auditor must estimate the levy or
87.30rate in preparing the notices required in subdivision 3, if the other county has not certified
87.31the appropriate information. If requested by the home county auditor, the other county
87.32auditor must furnish an estimate to the home county auditor.
87.33EFFECTIVE DATE.This section is effective for proposed notices and hearings
87.34held in 2009 and thereafter, for property taxes payable in 2010 and thereafter.

88.1    Sec. 34. Minnesota Statutes 2006, section 275.065, subdivision 1c, is amended to read:
88.2    Subd. 1c. Levy; shared, merged, consolidated services. If two or more taxing
88.3authorities are in the process of negotiating an agreement for sharing, merging, or
88.4consolidating services between those taxing authorities at the time the proposed levy is to
88.5be certified under subdivision 1, each taxing authority involved in the negotiation shall
88.6certify its total proposed levy as provided in that subdivision, including a notification to the
88.7county auditor of the specific service involved in the agreement which is not yet finalized.
88.8The affected taxing authorities may amend their proposed levies under subdivision 1 until
88.9October September 10 for levy amounts relating only to the specific service involved.
88.10EFFECTIVE DATE.This section is effective for proposed notices and hearings
88.11held in 2009 and thereafter, for property taxes payable in 2010 and thereafter.

88.12    Sec. 35. Minnesota Statutes 2006, section 275.065, is amended by adding a subdivision
88.13to read:
88.14    Subd. 1d. Failure to certify proposed levy. If a taxing authority fails to certify
88.15its proposed levy by the due dates specified under subdivisions 1, 1a, and 1c, the county
88.16auditor shall use the authority's previous year's final levy under section 275.07, subdivision
88.171, for purposes of determining its proposed property tax notices and public advertisements
88.18under this section.
88.19EFFECTIVE DATE.This section is effective for notices prepared in 2008, for
88.20property taxes payable in 2009 and thereafter.

88.21    Sec. 36. Minnesota Statutes 2007 Supplement, section 275.065, subdivision 3, is
88.22amended to read:
88.23    Subd. 3. Notice of proposed property taxes. (a) The county auditor shall prepare
88.24and the county treasurer shall deliver after November 10 October 15 and on or before
88.25November October 24 each year, by first class mail to each taxpayer at the address listed
88.26on the county's current year's assessment roll, a notice of proposed property taxes.
88.27    (b) The commissioner of revenue shall prescribe the form of the notice.
88.28    (c) The notice must inform taxpayers that it contains the amount of property taxes
88.29each taxing authority proposes to collect for taxes payable the following year. In the case
88.30of a town, or in the case of the state general tax, the final tax amount will be its proposed
88.31tax. In the case of taxing authorities required to hold a public meeting under subdivision 6,
88.32the notice must clearly state that each taxing authority, including regional library districts
88.33established under section 134.201, and including the metropolitan taxing districts as
88.34defined in paragraph (i), but excluding all other special taxing districts and towns, will
89.1hold a public meeting to receive public testimony on the proposed budget and proposed or
89.2final property tax levy, or, in case of a school district, on the current budget and proposed
89.3property tax levy. It must clearly state the time and place of each taxing authority's
89.4meeting, a telephone number for the taxing authority that taxpayers may call if they have
89.5questions related to the notice, and an address where comments will be received by mail.
89.6    (d) The notice must state for each parcel:
89.7    (1) the market value of the property as determined under section 273.11, and used
89.8for computing property taxes payable in the following year and for taxes payable in the
89.9current year as each appears in the records of the county assessor on November October
89.101 of the current year; and, in the case of residential property, whether the property is
89.11classified as homestead or nonhomestead. The notice must clearly inform taxpayers of the
89.12years to which the market values apply and that the values are final values;
89.13    (2) the items listed below, shown separately by county, city or town, and state general
89.14tax, net of the residential and agricultural homestead credit under section 273.1384, voter
89.15approved school levy, other local school levy, and the sum of the special taxing districts,
89.16and as a total of all taxing authorities:
89.17    (i) the actual tax for taxes payable in the current year; and
89.18    (ii) the proposed tax amount.
89.19    If the county levy under clause (2) includes an amount for a lake improvement
89.20district as defined under sections 103B.501 to 103B.581, the amount attributable for that
89.21purpose must be separately stated from the remaining county levy amount.
89.22    In the case of a town or the state general tax, the final tax shall also be its proposed
89.23tax unless the town changes its levy at a special town meeting under section 365.52. If a
89.24school district has certified under section 126C.17, subdivision 9, that a referendum will
89.25be held in the school district at the November general election, the county auditor must
89.26note next to the school district's proposed amount that a referendum is pending and that, if
89.27approved by the voters, the tax amount may be higher than shown on the notice. In the
89.28case of the city of Minneapolis, the levy for Minneapolis Park and Recreation shall be
89.29listed separately from the remaining amount of the city's levy. In the case of the city of
89.30St. Paul, the levy for the St. Paul Library Agency must be listed separately from the
89.31remaining amount of the city's levy. In the case of Ramsey County, any amount levied
89.32under section 134.07 may be listed separately from the remaining amount of the county's
89.33levy. In the case of a parcel where tax increment or the fiscal disparities areawide tax
89.34under chapter 276A or 473F applies, the proposed tax levy on the captured value or the
89.35proposed tax levy on the tax capacity subject to the areawide tax must each be stated
89.36separately and not included in the sum of the special taxing districts; and
90.1    (3) the increase or decrease between the total taxes payable in the current year and
90.2the total proposed taxes, expressed as a percentage.
90.3    For purposes of this section, the amount of the tax on homesteads qualifying under
90.4the senior citizens' property tax deferral program under chapter 290B is the total amount
90.5of property tax before subtraction of the deferred property tax amount.
90.6    (e) The notice must clearly state that the proposed or final taxes do not include
90.7the following:
90.8    (1) special assessments;
90.9    (2) levies approved by the voters after the date the proposed taxes are certified,
90.10including bond referenda and school district levy referenda;
90.11    (3) a levy limit increase approved by the voters by the first Tuesday after the first
90.12Monday in November of the levy year as provided under section 275.73;
90.13    (4) amounts necessary to pay cleanup or other costs due to a natural disaster
90.14occurring after the date the proposed taxes are certified;
90.15    (5) amounts necessary to pay tort judgments against the taxing authority that become
90.16final after the date the proposed taxes are certified; and
90.17    (6) the contamination tax imposed on properties which received market value
90.18reductions for contamination.
90.19    (f) Except as provided in subdivision 7, failure of the county auditor to prepare or
90.20the county treasurer to deliver the notice as required in this section does not invalidate the
90.21proposed or final tax levy or the taxes payable pursuant to the tax levy.
90.22    (g) If the notice the taxpayer receives under this section lists the property as
90.23nonhomestead, and satisfactory documentation is provided to the county assessor by the
90.24applicable deadline, and the property qualifies for the homestead classification in that
90.25assessment year, the assessor shall reclassify the property to homestead for taxes payable
90.26in the following year.
90.27    (h) In the case of class 4 residential property used as a residence for lease or rental
90.28periods of 30 days or more, the taxpayer must either:
90.29    (1) mail or deliver a copy of the notice of proposed property taxes to each tenant,
90.30renter, or lessee; or
90.31    (2) post a copy of the notice in a conspicuous place on the premises of the property.
90.32    The notice must be mailed or posted by the taxpayer by November October 27 or
90.33within three days of receipt of the notice, whichever is later. A taxpayer may notify the
90.34county treasurer of the address of the taxpayer, agent, caretaker, or manager of the premises
90.35to which the notice must be mailed in order to fulfill the requirements of this paragraph.
91.1    (i) For purposes of this subdivision, subdivisions 5a and 6, "metropolitan special
91.2taxing districts" means the following taxing districts in the seven-county metropolitan area
91.3that levy a property tax for any of the specified purposes listed below:
91.4    (1) Metropolitan Council under section 473.132, 473.167, 473.249, 473.325,
91.5473.446 , 473.521, 473.547, or 473.834;
91.6    (2) Metropolitan Airports Commission under section 473.667, 473.671, or 473.672;
91.7and
91.8    (3) Metropolitan Mosquito Control Commission under section 473.711.
91.9    For purposes of this section, any levies made by the regional rail authorities in the
91.10county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter
91.11398A shall be included with the appropriate county's levy and shall be discussed at that
91.12county's public hearing.
91.13    (j) The governing body of a county, city, or school district may, with the consent
91.14of the county board, include supplemental information with the statement of proposed
91.15property taxes about the impact of state aid increases or decreases on property tax
91.16increases or decreases and on the level of services provided in the affected jurisdiction.
91.17This supplemental information may include information for the following year, the current
91.18year, and for as many consecutive preceding years as deemed appropriate by the governing
91.19body of the county, city, or school district. It may include only information regarding:
91.20    (1) the impact of inflation as measured by the implicit price deflator for state and
91.21local government purchases;
91.22    (2) population growth and decline;
91.23    (3) state or federal government action; and
91.24    (4) other financial factors that affect the level of property taxation and local services
91.25that the governing body of the county, city, or school district may deem appropriate to
91.26include.
91.27    The information may be presented using tables, written narrative, and graphic
91.28representations and may contain instruction toward further sources of information or
91.29opportunity for comment.
91.30EFFECTIVE DATE.This section is effective for proposed notices and hearings
91.31held in 2009 and thereafter, for property taxes payable in 2010 and thereafter.

91.32    Sec. 37. Minnesota Statutes 2006, section 275.065, is amended by adding a subdivision
91.33to read:
91.34    Subd. 3b. Supplemental notice of proposed levy increases. (a) If a city that has a
91.35population of more than 2,500 or a county proposes a levy that would cause a levy plus
92.1aid increase greater than the threshold increase calculated under paragraph (b), it shall
92.2prepare and deliver by first class mail a supplemental proposed property tax notice to each
92.3property taxpayer in the taxing jurisdiction, as described in this subdivision.
92.4    (b) The threshold increase in the proposed property tax levy plus aid is equal to
92.5the levy plus aid amount in the previous year, multiplied by the sum of (i) one percent,
92.6(ii) the percentage growth, if any, in the population in the taxing jurisdiction for the
92.7most recent available year, (iii) the percentage increase in the total market value in the
92.8taxing jurisdiction due to new construction of commercial and industrial property, and
92.9(iv) the percentage increase in the implicit price deflator for government consumption
92.10expenditures and gross investment for state and local governments as prepared by the
92.11United States Department of Commerce for the most recent 12-month period ending
92.12March of the levy year.
92.13    (c) The supplemental proposed notice must show the taxing jurisdiction's (1) levy
92.14plus aid amount for the previous year, (2) its threshold levy plus aid increase indicating that
92.15this increase is calculated to reflect reasonable growth adjusting for population increases,
92.16increased demand from new business, and inflation, (3) the aid amount corresponding to
92.17the proposed levy year, (4) the proposed property tax increase, and (5) the amount the
92.18proposed increase in levy plus aid exceeds the threshold increase. The notice must contain
92.19a description of why the jurisdiction needs to raise property taxes above the threshold
92.20amount and how the taxing jurisdiction plans to spend the additional revenue.
92.21    (d) For purposes of this subdivision, "aid" means county program aid under section
92.22477A.0124 or local government aid under section 477A.013.
92.23EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
92.24thereafter.

92.25    Sec. 38. Minnesota Statutes 2006, section 275.065, subdivision 6, is amended to read:
92.26    Subd. 6. Public hearing; adoption of budget and levy. (a) For purposes of this
92.27section, the following terms shall have the meanings given:
92.28    (1) "Initial hearing" means the first and primary hearing held to discuss the taxing
92.29authority's proposed budget and proposed property tax levy for taxes payable in the
92.30following year, or, for school districts, the current budget and the proposed property tax
92.31levy for taxes payable in the following year.
92.32    (2) "Continuation hearing" means a hearing held to complete the initial hearing, if
92.33the initial hearing is not completed on its scheduled date.
93.1    (3) "Subsequent hearing" means the hearing held to adopt the taxing authority's final
93.2property tax levy, and, in the case of taxing authorities other than school districts, the final
93.3budget, for taxes payable in the following year.
93.4    (b) Between November 29 9 and December 20 1, the governing bodies of a city that
93.5has a population over 500, county, metropolitan special taxing districts as defined in
93.6subdivision 3, paragraph (i), and regional library districts shall each hold an initial public
93.7hearing to discuss and seek public comment on its final budget and property tax levy for
93.8taxes payable in the following year, and the governing body of the school district shall
93.9hold an initial public hearing to review its current budget and proposed property tax
93.10levy for taxes payable in the following year. The metropolitan special taxing districts
93.11shall be required to hold only a single joint initial public hearing, the location of which
93.12will be determined by the affected metropolitan agencies. A city, county, metropolitan
93.13special taxing district as defined in subdivision 3, paragraph (i), regional library district
93.14established under section 134.201, or school district is not required to hold a public
93.15hearing under this subdivision unless its proposed property tax levy for taxes payable
93.16in the following year, as certified under subdivision 1, has increased over its final
93.17property tax levy for taxes payable in the current year by a percentage that is greater
93.18than the percentage increase in the implicit price deflator for government consumption
93.19expenditures and gross investment for state and local governments prepared by the Bureau
93.20of Economic Analysts of the United States Department of Commerce for the 12-month
93.21period ending March 31 of the current year.
93.22    (c) The initial hearing must be held after 5:00 p.m. if scheduled on a day other than
93.23Saturday. No initial hearing may be held on a Sunday.
93.24    (d) At the initial hearing under this subdivision, the percentage increase in property
93.25taxes proposed by the taxing authority, if any, and the specific purposes for which property
93.26tax revenues are being increased must be discussed. During the discussion, the governing
93.27body shall hear comments regarding a proposed increase and explain the reasons for the
93.28proposed increase. The public shall be allowed to speak and to ask questions. At the public
93.29hearing, the school district must also provide and discuss information on the distribution
93.30of its revenues by revenue source, and the distribution of its spending by program area.
93.31    (e) If the initial hearing is not completed on its scheduled date, the taxing authority
93.32must announce, prior to adjournment of the hearing, the date, time, and place for the
93.33continuation of the hearing. The continuation hearing must be held at least five business
93.34days but no more than 14 business days after the initial hearing. A continuation hearing
93.35may not be held later than December 20 except as provided in paragraphs (f) and (g).
94.1A continuation hearing must be held after 5:00 p.m. if scheduled on a day other than
94.2Saturday. No continuation hearing may be held on a Sunday.
94.3    (f) The governing body of a county shall hold its initial hearing on the first second
94.4Thursday in December November each year, and may hold additional initial hearings on
94.5other dates before December 20 1 if necessary for the convenience of county residents. If
94.6the county needs a continuation of its hearing, the continuation hearing shall be held on
94.7the third Tuesday in December. If the third Tuesday in December falls on December 21,
94.8the county's continuation hearing shall be held on Monday, December 20 November.
94.9    (g) The metropolitan special taxing districts shall hold a joint initial public hearing
94.10on the first Wednesday of December. A continuation hearing, if necessary, shall be held on
94.11the second Wednesday of December even if that second Wednesday is after December 10.
94.12    (h) The county auditor shall provide for the coordination of initial and continuation
94.13hearing dates for all school districts and cities within the county to prevent conflicts under
94.14clauses (i) and (j).
94.15    (i) By August 10, each school board and the board of the regional library district
94.16shall certify to the county auditors of the counties in which the school district or regional
94.17library district is located the dates on which it elects to hold its initial hearing and any
94.18continuation hearing. If a school board or regional library district does not certify these
94.19dates by August 10, the auditor will assign the initial and continuation hearing dates. The
94.20dates elected or assigned must not conflict with the initial and continuation hearing dates
94.21of the county or the metropolitan special taxing districts.
94.22    (j) By August 20, the county auditor shall notify the clerks of the cities within the
94.23county of the dates on which school districts and regional library districts have elected
94.24to hold their initial and continuation hearings. At the time a city certifies its proposed
94.25levy under subdivision 1 it shall certify the dates on which it elects to hold its initial
94.26hearing and any continuation hearing. Until September 15, the first and second Mondays
94.27Monday of December are is reserved for the use of the cities. If a city does not certify its
94.28hearing dates by September 15, the auditor shall assign the initial and continuation hearing
94.29dates. The dates elected or assigned for the initial hearing must not conflict with the
94.30initial hearing dates of the county, metropolitan special taxing districts, regional library
94.31districts, or school districts within which the city is located. To the extent possible, the
94.32dates of the city's continuation hearing should not conflict with the continuation hearing
94.33dates of the county, metropolitan special taxing districts, regional library districts, or
94.34school districts within which the city is located. This paragraph does not apply to cities
94.35of 500 population or less.
95.1    (k) The county initial hearing date and the city, metropolitan special taxing district,
95.2regional library district, and school district initial hearing dates must be designated on
95.3the notices required under subdivision 3. The continuation hearing dates need not be
95.4stated on the notices.
95.5    (l) At a subsequent hearing, each county, school district, city over 500 population,
95.6and metropolitan special taxing district may amend its proposed property tax levy
95.7and must adopt a final property tax levy. Each county, city over 500 population, and
95.8metropolitan special taxing district may also amend its proposed budget and must adopt a
95.9final budget at the subsequent hearing. The final property tax levy must be adopted prior
95.10to adopting the final budget. A school district is not required to adopt its final budget at the
95.11subsequent hearing. The subsequent hearing of a taxing authority must be held on a date
95.12subsequent to the date of the taxing authority's initial public hearing. If a continuation
95.13hearing is held, the subsequent hearing must be held either immediately following the
95.14continuation hearing or on a date subsequent to the continuation hearing. The subsequent
95.15hearing may be held at a regularly scheduled board or council meeting or at a special
95.16meeting scheduled for the purposes of the subsequent hearing. The subsequent hearing
95.17of a taxing authority does not have to be coordinated by the county auditor to prevent a
95.18conflict with an initial hearing, a continuation hearing, or a subsequent hearing of any
95.19other taxing authority. All subsequent hearings must be held prior to five working days
95.20after December 20 of the levy year. The date, time, and place of the subsequent hearing
95.21must be announced at the initial public hearing or at the continuation hearing.
95.22    (m) The property tax levy certified under section 275.07 by a city of any population,
95.23county, metropolitan special taxing district, regional library district, or school district
95.24must not exceed the proposed levy determined under subdivision 1, except by an amount
95.25up to the sum of the following amounts:
95.26    (1) the amount of a school district levy whose voters approved a referendum to
95.27increase taxes under section 123B.63, subdivision 3, or 126C.17, subdivision 9, after
95.28the proposed levy was certified;
95.29    (2) the amount of a city or county levy approved by the voters after the proposed
95.30levy was certified;
95.31    (3) the amount of a levy to pay principal and interest on bonds approved by the
95.32voters under section 475.58 after the proposed levy was certified;
95.33    (4) the amount of a levy to pay costs due to a natural disaster occurring after the
95.34proposed levy was certified, if that amount is approved by the commissioner of revenue
95.35under subdivision 6a;
96.1    (5) the amount of a levy to pay tort judgments against a taxing authority that become
96.2final after the proposed levy was certified, if the amount is approved by the commissioner
96.3of revenue under subdivision 6a;
96.4    (6) the amount of an increase in levy limits certified to the taxing authority by the
96.5commissioner of education or the commissioner of revenue after the proposed levy was
96.6certified; and
96.7    (7) the amount required under section 126C.55.
96.8    (n) This subdivision does not apply to towns and special taxing districts other than
96.9regional library districts and metropolitan special taxing districts.
96.10    (o) Notwithstanding the requirements of this section, the employer is required to
96.11meet and negotiate over employee compensation as provided for in chapter 179A.
96.12EFFECTIVE DATE.This section is effective for proposed notices and hearings
96.13held in 2009 and thereafter, for property taxes payable in 2010 and thereafter.

96.14    Sec. 39. Minnesota Statutes 2006, section 275.065, subdivision 8, is amended to read:
96.15    Subd. 8. Hearing. Notwithstanding any other provision of law, Ramsey County,
96.16the city of St. Paul, and Independent School District No. 625 are authorized to and shall
96.17hold their initial public hearing jointly. The hearing must be held on during the week of
96.18the second Tuesday of December November each year. The advertisement required in
96.19subdivision 5a may be a joint advertisement. The hearing is otherwise subject to the
96.20requirements of this section.
96.21    Ramsey County is authorized to hold an additional initial hearing or hearings as
96.22provided under this section, provided that any additional hearings must not conflict
96.23with the initial or continuation hearing dates of the other taxing districts. However, if
96.24Ramsey County elects not to hold such additional initial hearing or hearings, the joint
96.25initial hearing required by this subdivision must be held in a St. Paul location convenient
96.26to residents of Ramsey County.
96.27EFFECTIVE DATE.This section is effective for proposed notices and hearings
96.28held in 2009 and thereafter, for property taxes payable in 2010 and thereafter, except that
96.29proposed notices and hearings held in 2008 may be held during the week of the second
96.30Tuesday of December.

96.31    Sec. 40. Minnesota Statutes 2006, section 275.065, subdivision 9, is amended to read:
96.32    Subd. 9. Aitkin County and school district hearing. Notwithstanding any other
96.33law, Aitkin County and Independent School District No. 1, and the city of Aitkin, or any
96.34two of them, may hold their initial public hearing jointly. The hearing must be held on
97.1the second Tuesday of December November each year. The advertisement required in
97.2subdivision 5a may be a joint advertisement. The hearing is otherwise subject to the
97.3requirements of this section.
97.4EFFECTIVE DATE.This section is effective for proposed notices and hearings
97.5held in 2009 and thereafter, for property taxes payable in 2010 and thereafter.

97.6    Sec. 41. Minnesota Statutes 2006, section 275.065, subdivision 10, is amended to read:
97.7    Subd. 10. Nobles County; joint initial public hearing. Notwithstanding any
97.8other law, Nobles County, the city of Worthington, and Independent School District No.
97.9518, Worthington, or any two of them, may hold their initial public hearing jointly. The
97.10hearing must be held on the second Tuesday of December November each year. The
97.11advertisement required in subdivision 5a may be a joint advertisement. The hearing is
97.12otherwise subject to the requirements of this section.
97.13EFFECTIVE DATE.This section is effective for proposed notices and hearings
97.14held in 2009 and thereafter, for property taxes payable in 2010 and thereafter.

97.15    Sec. 42. Minnesota Statutes 2006, section 282.08, is amended to read:
97.16282.08 APPORTIONMENT OF PROCEEDS TO TAXING DISTRICTS.
97.17    The net proceeds from the sale or rental of any parcel of forfeited land, or from the
97.18sale of products from the forfeited land, must be apportioned by the county auditor to the
97.19taxing districts interested in the land, as follows:
97.20    (1) the portion required to pay any amounts included in the appraised value
97.21under section 282.01, subdivision 3, as representing increased value due to any public
97.22improvement made after forfeiture of the parcel to the state, but not exceeding the amount
97.23certified by the clerk of the municipality appropriate governmental authority must be
97.24apportioned to the municipal governmental subdivision entitled to it;
97.25    (2) the portion required to pay any amount included in the appraised value under
97.26section 282.019, subdivision 5, representing increased value due to response actions
97.27taken after forfeiture of the parcel to the state, but not exceeding the amount of expenses
97.28certified by the Pollution Control Agency or the commissioner of agriculture, must be
97.29apportioned to the agency or the commissioner of agriculture and deposited in the fund
97.30from which the expenses were paid;
97.31    (3) the portion of the remainder required to discharge any special assessment
97.32chargeable against the parcel for drainage or other purpose whether due or deferred at
97.33the time of forfeiture, must be apportioned to the municipal governmental subdivision
97.34entitled to it; and
98.1    (4) any balance must be apportioned as follows:
98.2    (i) The county board may annually by resolution set aside no more than 30 percent
98.3of the receipts remaining to be used for forest development on tax-forfeited land and
98.4dedicated memorial forests, to be expended under the supervision of the county board. It
98.5must be expended only on projects improving the health and management of the forest
98.6resource.
98.7    (ii) The county board may annually by resolution set aside no more than 20 percent
98.8of the receipts remaining to be used for the acquisition and maintenance of county parks
98.9or recreational areas as defined in sections 398.31 to 398.36, to be expended under the
98.10supervision of the county board.
98.11    (iii) Any balance remaining must be apportioned as follows: county, 40 percent;
98.12town or city, 20 percent; and school district, 40 percent, provided, however, that in
98.13unorganized territory that portion which would have accrued to the township must be
98.14administered by the county board of commissioners.
98.15EFFECTIVE DATE.This section is effective the day following final enactment.

98.16    Sec. 43. Minnesota Statutes 2006, section 290B.03, subdivision 1, is amended to read:
98.17    Subdivision 1. Program qualifications. The qualifications for the senior citizens'
98.18property tax deferral program are as follows:
98.19    (1) the property must be owned and occupied as a homestead by a person 65 years
98.20of age or older. In the case of a married couple, both only one of the spouses must be at
98.21least 65 years old and the other spouse must be at least 62 years old at the time the first
98.22property tax deferral is granted, regardless of whether the property is titled in the name
98.23of one spouse or both spouses, or titled in another way that permits the property to have
98.24homestead status;
98.25    (2) the total household income of the qualifying homeowners homeowner, or in the
98.26case of a married couple, the qualifying homeowner and spouse, as defined in section
98.27290A.03, subdivision 5 , for the calendar year preceding the year of the initial application
98.28may not exceed $60,000 $80,000;
98.29    (3) the homestead must have been owned and occupied as the homestead of at
98.30least one of the qualifying homeowners for at least 15 years prior to the year the initial
98.31application is filed;
98.32    (4) there are no state or federal tax liens or judgment liens on the homesteaded
98.33property;
98.34    (5) there are no mortgages or other liens on the property that secure future advances,
98.35except for those subject to credit limits that result in compliance with clause (6); and
99.1    (6) the total unpaid balances of debts secured by mortgages and other liens on the
99.2property, including unpaid and delinquent special assessments and interest and any
99.3delinquent property taxes, penalties, and interest, but not including property taxes payable
99.4during the year, does not exceed 75 percent of the assessor's estimated market value for
99.5the year.
99.6EFFECTIVE DATE.This section is effective for applications filed on or after
99.7July 1, 2008.

99.8    Sec. 44. Minnesota Statutes 2006, section 290B.04, subdivision 3, is amended to read:
99.9    Subd. 3. Excess-income certification by taxpayer. A taxpayer whose initial
99.10application has been approved under subdivision 2 shall notify the commissioner of
99.11revenue in writing by July 1 if the taxpayer's household income for the preceding calendar
99.12year exceeded $60,000 $80,000. The certification must state the homeowner's total
99.13household income for the previous calendar year. No property taxes may be deferred
99.14under this chapter in any year following the year in which a program participant filed or
99.15should have filed an excess-income certification under this subdivision showing income in
99.16excess of the maximum allowed, unless the participant has filed a resumption of eligibility
99.17certification as described in subdivision 4.
99.18EFFECTIVE DATE.This section is effective for applications filed on or after
99.19July 1, 2008.

99.20    Sec. 45. Minnesota Statutes 2006, section 290B.04, subdivision 4, is amended to read:
99.21    Subd. 4. Resumption of eligibility certification by taxpayer. A taxpayer who has
99.22previously filed an excess-income certification under subdivision 3 may resume program
99.23participation if the taxpayer's household income for a subsequent year is $60,000 $80,000
99.24or less. If the taxpayer chooses to resume program participation, the taxpayer must notify
99.25the commissioner of revenue in writing by July 1 of the year following a calendar year in
99.26which the taxpayer's household income is $60,000 $80,000 or less. The certification must
99.27state the taxpayer's total household income for the previous calendar year. Once a taxpayer
99.28resumes participation in the program under this subdivision, participation will continue
99.29until the taxpayer files a subsequent excess-income certification under subdivision 3 or
99.30until participation is terminated under section 290B.08, subdivision 1.
99.31EFFECTIVE DATE.This section is effective for applications filed on or after
99.32July 1, 2008.

99.33    Sec. 46. Minnesota Statutes 2006, section 290B.05, subdivision 1, is amended to read:
100.1    Subdivision 1. Determination by commissioner. The commissioner shall
100.2determine each qualifying homeowner's "annual maximum property tax amount"
100.3following approval of the homeowner's initial application and following the receipt of a
100.4resumption of eligibility certification. The "annual maximum property tax amount" equals
100.5three percent of the homeowner's total household income for the year preceding either the
100.6initial application or the resumption of eligibility certification, whichever is applicable.
100.7Following approval of the initial application, the commissioner shall determine the
100.8qualifying homeowner's "maximum allowable deferral." No tax may be deferred relative
100.9to the appropriate assessment year for any homeowner whose total household income
100.10for the previous year exceeds $60,000 $80,000. No tax shall be deferred in any year in
100.11which the homeowner does not meet the program qualifications in section 290B.03. The
100.12maximum allowable total deferral is equal to 75 percent of the assessor's estimated market
100.13value for the year, less the balance of any mortgage loans and other amounts secured by
100.14liens against the property at the time of application, including any unpaid and delinquent
100.15special assessments and interest and any delinquent property taxes, penalties, and interest,
100.16but not including property taxes payable during the year.
100.17EFFECTIVE DATE.This section is effective for applications received on or after
100.18July 1, 2008.

100.19    Sec. 47. Minnesota Statutes 2006, section 290B.07, is amended to read:
100.20290B.07 LIEN; DEFERRED PORTION.
100.21    (a) Payment by the state to the county treasurer of property taxes, penalties, interest,
100.22or special assessments and interest deferred under this chapter is deemed a loan from the
100.23state to the program participant. The commissioner must compute the interest as provided
100.24in section 270C.40, subdivision 5, but not to exceed five percent, and maintain records of
100.25the total deferred amount and interest for each participant. Interest shall accrue beginning
100.26September 1 of the payable year for which the taxes are deferred, provided that no interest
100.27shall be charged on (1) deferred property tax amounts on applications filed on or after
100.28July 1, 2008, or (2) deferred property taxes beginning with taxes payable in 2009 on
100.29applications filed prior to July 1, 2008. Any deferral made under this chapter shall not
100.30be construed as delinquent property taxes.
100.31    The lien created under section 272.31 continues to secure payment by the taxpayer,
100.32or by the taxpayer's successors or assigns, of the amount deferred, including interest, with
100.33respect to all years for which amounts are deferred. The lien for deferred taxes and interest
100.34has the same priority as any other lien under section 272.31, except that liens, including
100.35mortgages, recorded or filed prior to the recording or filing of the notice under section
101.1290B.04, subdivision 2 , have priority over the lien for deferred taxes and interest. A
101.2seller's interest in a contract for deed, in which a qualifying homeowner is the purchaser
101.3or an assignee of the purchaser, has priority over deferred taxes and interest on deferred
101.4taxes, regardless of whether the contract for deed is recorded or filed. The lien for deferred
101.5taxes and interest for future years has the same priority as the lien for deferred taxes and
101.6interest for the first year, which is always higher in priority than any mortgages or other
101.7liens filed, recorded, or created after the notice recorded or filed under section 290B.04,
101.8subdivision 2 . The county treasurer or auditor shall maintain records of the deferred
101.9portion and shall list the amount of deferred taxes for the year and the cumulative deferral
101.10and interest for all previous years as a lien against the property. In any certification of
101.11unpaid taxes for a tax parcel, the county auditor shall clearly distinguish between taxes
101.12payable in the current year, deferred taxes and interest, and delinquent taxes. Payment
101.13of the deferred portion becomes due and owing at the time specified in section 290B.08.
101.14Upon receipt of the payment, the commissioner shall issue a receipt for it to the person
101.15making the payment upon request and shall notify the auditor of the county in which the
101.16parcel is located, within ten days, identifying the parcel to which the payment applies.
101.17Upon receipt by the commissioner of revenue of collected funds in the amount of the
101.18deferral, the state's loan to the program participant is deemed paid in full.
101.19    (b) If property for which taxes have been deferred under this chapter forfeits
101.20under chapter 281 for nonpayment of a nondeferred property tax amount, or because
101.21of nonpayment of amounts previously deferred following a termination under section
101.22290B.08 , the lien for the taxes deferred under this chapter, plus interest and costs, shall be
101.23canceled by the county auditor as provided in section 282.07. However, notwithstanding
101.24any other law to the contrary, any proceeds from a subsequent sale of the property under
101.25chapter 282 or another law, must be used to first reimburse the county's forfeited tax sale
101.26fund for any direct costs of selling the property or any costs directly related to preparing
101.27the property for sale, and then to reimburse the state for the amount of the canceled lien.
101.28Within 90 days of the receipt of any sale proceed to which the state is entitled under these
101.29provisions, the county auditor must pay those funds to the commissioner of revenue by
101.30warrant for deposit in the general fund. No other deposit, use, distribution, or release of
101.31gross sale proceeds or receipts may be made by the county until payments sufficient
101.32to fully reimburse the state for the canceled lien amount have been transmitted to the
101.33commissioner.
101.34EFFECTIVE DATE.This section is effective July 1, 2008.

101.35    Sec. 48. [290D.01] CITATION.
102.1    This program shall be named the "seasonal recreational property tax deferral
102.2program."
102.3EFFECTIVE DATE.This section is effective July 1, 2009.

102.4    Sec. 49. [290D.02] TERMS.
102.5    Subdivision 1. Terms. For purposes of sections 290D.01 to 290D.08, the terms
102.6defined in this section have the meanings given them.
102.7    Subd. 2. Primary property owner. "Primary property owner" means a person who
102.8(1) has been the owner, or one of the owners, of the eligible property for at least 15 years
102.9prior to the year the application is filed under section 290D.04; and (2) applies for the
102.10deferral of property taxes under section 290D.04.
102.11    Subd. 3. Secondary property owner. "Secondary property owner" means any
102.12person, other than the primary property owner, who has been an owner of the eligible
102.13property for at least 15 years prior to the year the initial application is filed for deferral
102.14of property taxes under section 290D.04.
102.15    Subd. 4. Eligible property. "Eligible property" means a parcel of property or
102.16contiguous parcels of property under the same ownership classified as noncommercial
102.17seasonal residential recreational 4c(1) property under section 273.13, subdivision 25.
102.18    Subd. 5. Base property tax amount. "Base property tax amount" means the total
102.19property taxes levied by all taxing jurisdictions, including special assessments, on the
102.20eligible property in the year prior to the year that the initial application is approved under
102.21section 290D.04 and payable in the year of the application.
102.22    Subd. 6. Special assessments. "Special assessments" means any assessment, fee, or
102.23other charge that may be made by law, and that appears on the property tax statement for
102.24the property for collection under the laws applicable to the enforcement of real estate taxes.
102.25    Subd. 7. Commissioner. "Commissioner" means the commissioner of revenue.
102.26EFFECTIVE DATE.This section is effective for applications filed July 1, 2009,
102.27and thereafter.

102.28    Sec. 50. [290D.03] QUALIFICATIONS FOR DEFERRAL.
102.29    In order for an eligible property to qualify for treatment under this program:
102.30    (1) the eligible property must have been owned solely by the primary property owner,
102.31or jointly with others, for at least 15 years prior to the year the initial application is filed;
102.32    (2) there must be no state or federal tax liens or judgment liens on the eligible
102.33property;
103.1    (3) there must be no mortgages or other liens on the eligible property that secure
103.2future advances, except for those subject to credit limits that result in compliance with
103.3clause (4); and
103.4    (4) the total unpaid balances of debts secured by mortgages and other liens on the
103.5eligible property, including unpaid and delinquent special assessments and interest and
103.6any delinquent property taxes, penalties, and interest, but not including property taxes
103.7payable during the year, must not exceed 60 percent of the assessor's estimated market
103.8value for the current assessment year.
103.9EFFECTIVE DATE.This section is effective for applications filed July 1, 2009,
103.10and thereafter.

103.11    Sec. 51. [290D.04] APPLICATION FOR DEFERRAL.
103.12    Subdivision 1. Initial application. (a) A primary owner of a property meeting
103.13the qualifications under section 290D.03 may apply to the commissioner for deferral
103.14of taxes on the eligible property. Applications are due on or before July 1 for deferral
103.15of any taxes payable in the following year. The application, which must be prescribed
103.16by the commissioner, shall include the following items and any other information the
103.17commissioner deems necessary:
103.18    (1) the name, address, and Social Security number of the primary property owner
103.19and secondary property owners, if any;
103.20    (2) a copy of the property tax statement for the current taxes payable year for the
103.21eligible property;
103.22    (3) the initial year of ownership of the primary property owner and any second
103.23property owners of the eligible property;
103.24    (4) information on any mortgage loans or other amounts secured by mortgages or
103.25other liens against the eligible property, for which purpose the commissioner may require
103.26the applicant to provide a copy of the mortgage note, the mortgage, or a statement of the
103.27balance owing on the mortgage loan provided by the mortgage holder. The commissioner
103.28may require the appropriate documents in connection with obtaining and confirming
103.29information on unpaid amounts secured by other liens; and
103.30    (5) the signatures of the primary property owner and all other owners, if any, stating
103.31that each owner agrees to enroll the eligible property in the program to defer property
103.32taxes under this chapter.
103.33    The application must state that program participation is voluntary. The application
103.34must also state that program participation includes authorization for the annual deferred
104.1amount. The deferred property tax calculated by the county and the cumulative deferred
104.2property tax amount is public data.
104.3    (b) As part of the initial application process, if the property is abstract property, the
104.4commissioner may require the applicant to obtain at the applicant's cost a report prepared
104.5by a licensed abstracter showing the last deed and any unsatisfied mortgages, liens,
104.6judgments, and state and federal tax lien notices which were recorded on or after the date
104.7of that last deed with respect to the eligible property or to the applicant.
104.8    The certificate or report need not include references to any documents filed or
104.9recorded more than 40 years prior to the date of the certification or report. The certification
104.10or report must be as of a date not more than 30 days prior to submission of the application
104.11under this section.
104.12    The commissioner may also require the county recorder or county registrar of the
104.13county where the eligible property is located to provide copies of recorded documents
104.14related to the applicant of the eligible property, for which the recorder or registrar shall
104.15not charge a fee. The commissioner may use any information available to determine or
104.16verify eligibility under this section.
104.17    Subd. 2. Approval; recording. The commissioner shall approve all initial
104.18applications that qualify under this chapter and shall notify the primary property owner on
104.19or before December 1. The commissioner may investigate the facts or require confirmation
104.20in regard to an application. The commissioner shall record or file a notice of qualification
104.21for deferral, including the names of the primary and any secondary property owners and a
104.22legal description of the eligible property, in the office of the county recorder, or registrar of
104.23titles, whichever is applicable, in the county where the eligible property is located. The
104.24notice must state that it serves as a notice of lien and that it includes deferrals under this
104.25section for future years. The primary property owner shall pay the recording or filing fees
104.26for the notice, which, notwithstanding section 357.18, shall be paid by that owner at the
104.27time of satisfaction of the lien.
104.28    Subd. 3. Penalty for failure; investigations. (a) The commissioner shall assess
104.29a penalty equal to 20 percent of the property taxes improperly deferred in the case of a
104.30false application. The commissioner shall assess a penalty equal to 50 percent of the
104.31property taxes improperly deferred if the taxpayer knowingly filed a false application. The
104.32commissioner shall assess penalties under this section through the issuance of an order
104.33under the provisions of chapter 270C. Persons affected by a commissioner's order issued
104.34under this section may appeal as provided in chapter 270C.
105.1    (b) The commissioner may conduct investigations related to initial applications
105.2required under this chapter within the period ending 3-1/2 years from the due date of
105.3the application.
105.4    Subd. 4. Annual certification to commissioner. Annually on or before July 1,
105.5the primary property owner must certify to the commissioner that the person continues
105.6to qualify as a primary property owner. If the primary owner has died or has transferred
105.7the property in the preceding year, a certification may be filed by the primary owner's
105.8spouse, or by one of the secondary owners, provided that the person is currently an
105.9owner of the property. In this case, the primary owner's spouse or the secondary owner
105.10shall be considered the primary owner from that point forward. If neither the primary
105.11owner, the primary owner's spouse, or a secondary owner is eligible to file the required
105.12annual certification for the property, the property's participation in the program shall be
105.13terminated, and the procedures in section 290D.07 apply.
105.14    Subd. 5. Annual notice to primary property owner. Annually, on or before
105.15September 1, the commissioner shall notify each primary property owner, in writing, of
105.16the total cumulative deferred taxes and accrued interest on the qualifying property as of
105.17that date.
105.18EFFECTIVE DATE.This section is effective for applications filed July 1, 2009,
105.19and thereafter.

105.20    Sec. 52. [290D.05] DEFERRED PROPERTY TAX AMOUNT.
105.21    Subdivision 1. Calculation of deferred property tax amount. Each year after
105.22the county auditor has determined the final property tax rates under section 275.08, the
105.23"deferred property tax amount" must be calculated on each eligible property. The deferred
105.24property tax amount is equal to 50 percent of the amount of the difference between (1) the
105.25total amount of property taxes and special assessments levied upon the eligible property
105.26for the current year by all taxing jurisdictions and (2) the eligible property's base property
105.27tax amount. Any tax attributable to new improvements made to the eligible property after
105.28the initial application has been approved under section 290D.04, subdivision 2, must be
105.29excluded in determining the deferred property tax amount. The eligible property's total
105.30current year's tax less the deferred property tax amount for the current year must be listed
105.31on the property tax statement and is the amount due to the county under chapter 276.
105.32Reference that the property is enrolled in the seasonal recreational property tax deferral
105.33program under this chapter and a state lien has been recorded must be clearly printed on
105.34the statement.
106.1    Subd. 2. Certification to commissioner. The county auditor shall annually, on or
106.2before April 15, certify to the commissioner the property tax deferral amounts determined
106.3under this section for each eligible property in the county. The commissioner shall
106.4prescribe the information that is necessary to identify the eligible properties.
106.5    Subd. 3. Limitation on total amount of deferred taxes. The total amount of
106.6deferred taxes and interest on a property, when added to (1) the balance owed on any
106.7mortgages on the property at the time of initial application; (2) other amounts secured by
106.8liens on the property at the time of the initial application; and (3) any unpaid and delinquent
106.9special assessments and interest and any delinquent property taxes, penalties, and interest,
106.10but not including property taxes payable during the year, must not exceed 60 percent of
106.11the assessor's estimated market value of the property for the current assessment year.
106.12EFFECTIVE DATE.This section is effective for applications filed July 1, 2009,
106.13and thereafter.

106.14    Sec. 53. [290D.06] LIEN; DEFERRED PORTION.
106.15    (a) Payment by the state to the county treasurer of property taxes, penalties, interest,
106.16or special assessments and interest, deferred under this chapter is deemed a loan from the
106.17state to the program participant. The commissioner shall compute the interest as provided
106.18in section 270C.40, subdivision 5, but not to exceed two percent over the maximum
106.19interest rate provided in section 290B.07, paragraph (a), and maintain records of the total
106.20deferred amount and interest for each participant. Interest accrues beginning September 1
106.21of the payable year for which the taxes are deferred. Any deferral made under this chapter
106.22must not be construed as delinquent property taxes.
106.23    The lien created under section 272.31 continues to secure payment by the taxpayer,
106.24or by the taxpayer's successors or assigns, of the amount deferred, including interest, with
106.25respect to all years for which amounts are deferred. The lien for deferred taxes and interest
106.26has the same priority as any other lien under section 272.31, except that liens, including
106.27mortgages, recorded or filed prior to the recording or filing of the notice under section
106.28290D.04, subdivision 2, have priority over the lien for deferred taxes and interest. A
106.29seller's interest in a contract for deed, in which a qualifying owner is the purchaser or an
106.30assignee of the purchaser, has priority over deferred taxes and interest on deferred taxes,
106.31regardless of whether the contract for deed is recorded or filed. The lien for deferred taxes
106.32and interest for future years has the same priority as the lien for deferred taxes and interest
106.33for the first year, which is always higher in priority than any mortgages or other liens filed,
106.34recorded, or created after the notice recorded or filed under section 290D.04, subdivision
106.352 . The county treasurer or auditor shall maintain records of the deferred portion and shall
107.1list the amount of deferred taxes for the year and the cumulative deferral and interest for
107.2all previous years as a lien against the eligible property. In any certification of unpaid
107.3taxes for a tax parcel, the county auditor shall clearly distinguish between taxes payable in
107.4the current year, deferred taxes and interest, and delinquent taxes. Payment of the deferred
107.5portion becomes due and owing at the time specified in section 290D.07. Upon receipt of
107.6the payment, the commissioner shall issue a receipt to the person making the payment
107.7upon request and shall notify the auditor of the county in which the parcel is located,
107.8within ten days, identifying the parcel to which the payment applies. Upon receipt by the
107.9commissioner of collected funds in the amount of the deferral, the state's loan to the
107.10program participant is deemed paid in full.
107.11    (b) If eligible property for which taxes have been deferred under this chapter forfeits
107.12under chapter 281 for nonpayment of a nondeferred property tax amount, or because
107.13of nonpayment of amounts previously deferred following a termination under section
107.14290D.07, the lien for the taxes deferred under this chapter, plus interest and costs, shall be
107.15canceled by the county auditor as provided in section 282.07. However, notwithstanding
107.16any other law to the contrary, any proceeds from a subsequent sale of the eligible property
107.17under chapter 282 or another law must be used to first reimburse the county's forfeited
107.18tax sale fund for any direct costs of selling the eligible property or any costs directly
107.19related to preparing the eligible property for sale, and then to reimburse the state for
107.20the amount of the canceled lien. Within 90 days of the receipt of any sale proceeds to
107.21which the state is entitled under these provisions, the county auditor must pay those funds
107.22to the commissioner by warrant for deposit in the general fund. No other deposit, use,
107.23distribution, or release of gross sale proceeds or receipts may be made by the county until
107.24payments sufficient to fully reimburse the state for the canceled lien amount have been
107.25transmitted to the commissioner.
107.26EFFECTIVE DATE.This section is effective for applications filed July 1, 2009,
107.27and thereafter.

107.28    Sec. 54. [290D.07] TERMINATION OF DEFERRAL; PAYMENT OF
107.29DEFERRED TAXES.
107.30    Subdivision 1. Termination. (a) The deferral of taxes granted under this chapter
107.31terminates when one of the following occurs:
107.32    (1) the eligible property is sold or transferred to someone other than the primary
107.33owner's spouse or a secondary owner;
108.1    (2) the death of the primary owner, or in the case of a married couple, after the
108.2death of both spouses, provided that there is not a secondary owner eligible to become
108.3the primary owner;
108.4    (3) the primary property owner notifies the commissioner, in writing, that all owners,
108.5including any secondary property owners, desire to discontinue the deferral; or
108.6    (4) the eligible property no longer qualifies under section 290D.03.
108.7    (b) An eligible property is not terminated from the program because no deferred
108.8property tax amount is determined for any given year after the eligible property's initial
108.9enrollment into the program.
108.10    (c) An eligible property is not terminated from the program if the eligible property
108.11subsequently becomes the homestead of one or more of the property owners and the
108.12property and the owners qualify for, and are immediately enrolled in, the senior deferral
108.13program under chapter 290B.
108.14    Subd. 2. Payment upon termination. Upon the termination of the deferral under
108.15subdivision 1, the amount of deferred taxes, penalties, interest, and special assessments
108.16and interest, plus the recording or filing fees under this subdivision and section 290D.04,
108.17subdivision 2 , becomes due and payable to the commissioner within 90 days of termination
108.18of the deferral for terminations under subdivision 1, paragraph (a), clauses (1) and (2),
108.19and within one year of termination of the deferral for terminations under subdivision 1,
108.20paragraph (a), clauses (3) and (4). No additional interest is due on the deferral if timely
108.21paid. On receipt of payment, the commissioner shall, within ten days, notify the auditor
108.22of the county in which the parcel is located, identifying the parcel to which the payment
108.23applies and shall remit the recording or filing fees under this subdivision and section
108.24290D.04, subdivision 2, to the auditor. A notice of termination of deferral, containing the
108.25legal description and the recording or filing data for the notice of qualification for deferral
108.26under section 290D.04, subdivision 2, shall be prepared and recorded or filed by the
108.27county auditor in the same office in which the notice of qualification for deferral under
108.28section 290D.04, subdivision 2, was recorded or filed, and the county auditor shall mail a
108.29copy of the notice of termination to the property owner. The property owner shall pay the
108.30recording or filing fees. Upon recording or filing of the notice of termination of deferral,
108.31the notice of qualification for deferral under section 290D.04, subdivision 2, and the lien
108.32created by it are discharged. If the deferral is not timely paid, the penalty, interest, lien,
108.33forfeiture, and other rules for the collection of ad valorem property taxes apply.
108.34EFFECTIVE DATE.This section is effective for applications filed July 1, 2009,
108.35and thereafter.

109.1    Sec. 55. [290D.08] STATE REIMBURSEMENT.
109.2    Subdivision 1. Determination; payment. The county auditor shall determine the
109.3total current year's deferred amount of property tax under this chapter in the county, and
109.4submit those amounts as part of the abstracts of tax lists submitted by the county auditors
109.5under section 275.29. The commissioner may make changes in the abstracts of tax lists as
109.6deemed necessary. The commissioner, after such review, shall pay the deferred amount of
109.7property tax to each county treasurer on or before August 31.
109.8    The county treasurer shall distribute, as part of the October settlement, the funds
109.9received as if they had been collected as part of the property tax.
109.10    Subd. 2. Appropriation. An amount sufficient to pay the total amount of property
109.11tax determined under subdivision 1, plus any amounts paid under section 290D.04,
109.12subdivision 4 , is annually appropriated from the general fund to the commissioner.
109.13EFFECTIVE DATE.This section is effective for applications filed July 1, 2009,
109.14and thereafter.

109.15    Sec. 56. Minnesota Statutes 2006, section 365A.095, is amended to read:
109.16365A.095 PETITION FOR REMOVAL OF DISTRICT; PROCEDURE;
109.17REFUND OF SURPLUS.
109.18    Subdivision 1. Petition; procedure. A petition signed by at least 75 percent of the
109.19property owners in the territory of the subordinate service district requesting the removal
109.20of the district may be presented to the town board. Within 30 days after the town board
109.21receives the petition, the town clerk shall determine the validity of the signatures on
109.22the petition. If the requisite number of signatures are certified as valid, the town board
109.23must hold a public hearing on the petitioned matter. Within 30 days after the end of
109.24the hearing, the town board must decide whether to discontinue the subordinate service
109.25district, continue as it is, or take some other action with respect to it.
109.26    Subd. 2. Option to refund surplus. If the district is removed under subdivision 1,
109.27after all outstanding obligations of the district have been paid in full, the town board may
109.28vote to refund any surplus tax revenue or service charge, or any part of it, collected from
109.29the district under section 365A.08. The refund must be distributed equally to the owners
109.30of any property within the discontinued district that were charged the extra tax or service
109.31fee during the most recent tax year for which the tax or service fee was imposed. Any
109.32surplus not refunded under this section must be transferred to the town's general fund.
109.33EFFECTIVE DATE.This section is effective the day following final enactment.

110.1    Sec. 57. Minnesota Statutes 2006, section 429.101, subdivision 1, is amended to read:
110.2    Subdivision 1. Ordinances. (a) In addition to any other method authorized by
110.3law or charter, the governing body of any municipality may provide for the collection
110.4of unpaid special charges as a special assessment against the property benefited for all
110.5or any part of the cost of:
110.6    (1) snow, ice, or rubbish removal from sidewalks;
110.7    (2) weed elimination from streets or private property;
110.8    (3) removal or elimination of public health or safety hazards from private property,
110.9excluding any structure included under the provisions of sections 463.15 to 463.26;
110.10    (4) installation or repair of water service lines, street sprinkling or other dust
110.11treatment of streets;
110.12    (5) the trimming and care of trees and the removal of unsound trees from any street;
110.13    (6) the treatment and removal of insect infested or diseased trees on private property,
110.14the repair of sidewalks and alleys;
110.15    (7) the operation of a street lighting system;
110.16    (8) the operation and maintenance of a fire protection or a pedestrian skyway system;
110.17    (9) reinspections which find noncompliance after the due date for compliance with
110.18an order to correct inspections relating to a municipal housing maintenance code violation;
110.19    (10) the recovery of any disbursements under section 504B.445, subdivision 4,
110.20clause (5), including disbursements for payment of utility bills and other services, even if
110.21provided by a third party, necessary to remedy violations as described in section 504B.445,
110.22subdivision 4 , clause (2); or
110.23    (11) [Repealed, 2004 c 275 s 5]
110.24as a special assessment against the property benefited.
110.25    (12) the recovery of delinquent vacant building registration fees under a municipal
110.26program designed to identify and register vacant buildings.
110.27    (b) The council may by ordinance adopt regulations consistent with this section to
110.28make this authority effective, including, at the option of the council, provisions for placing
110.29primary responsibility upon the property owner or occupant to do the work personally
110.30(except in the case of street sprinkling or other dust treatment, alley repair, tree trimming,
110.31care, and removal or the operation of a street lighting system) upon notice before the work
110.32is undertaken, and for collection from the property owner or other person served of the
110.33charges when due before unpaid charges are made a special assessment.
110.34EFFECTIVE DATE.This section is effective the day following final enactment.

110.35    Sec. 58. Minnesota Statutes 2006, section 469.1813, subdivision 8, is amended to read:
111.1    Subd. 8. Limitation on abatements. In any year, the total amount of property
111.2taxes abated by a political subdivision under this section may not exceed (1) ten percent
111.3of the current levy net tax capacity of the political subdivision for the taxes payable year
111.4to which the abatement applies, or (2) $200,000, whichever is greater. The limit under
111.5this subdivision does not apply to:
111.6    (i) an uncollected abatement from a prior year that is added to the abatement levy; or
111.7    (ii) a taxpayer whose real and personal property is subject to valuation under
111.8Minnesota Rules, chapter 8100.
111.9EFFECTIVE DATE.This section is effective for abatement resolutions approved
111.10after the day following final enactment.

111.11    Sec. 59. Minnesota Statutes 2006, section 473.446, subdivision 2, is amended to read:
111.12    Subd. 2. Transit taxing district. The metropolitan transit taxing district is hereby
111.13designated as that portion of the metropolitan transit area lying within the following
111.14named cities, towns, or unorganized territory within the counties indicated:
111.15    (a) Anoka County. Anoka, Blaine, Centerville, Columbia Heights, Coon Rapids,
111.16Fridley, Circle Pines, Hilltop, Lexington, Lino Lakes, Spring Lake Park;
111.17    (b) Carver County. Chanhassen, the city of Chaska;
111.18    (c) Dakota County. Apple Valley, Burnsville, Eagan, Inver Grove Heights, Lilydale,
111.19Mendota, Mendota Heights, Rosemount, South St. Paul, Sunfish Lake, West St. Paul;
111.20    (d) Ramsey County. All of the territory within Ramsey County;
111.21    (e) Hennepin County. Bloomington, Brooklyn Center, Brooklyn Park, Champlin,
111.22Chanhassen, Crystal, Deephaven, Eden Prairie, Edina, Excelsior, Golden Valley,
111.23Greenwood, Hopkins, Long Lake, Maple Grove, Medicine Lake, Minneapolis,
111.24Minnetonka, Minnetonka Beach, Mound, New Hope, Orono, Osseo, Plymouth, Richfield,
111.25Robbinsdale, St. Anthony, St. Louis Park, Shorewood, Spring Park, Tonka Bay, Wayzata,
111.26Woodland, the unorganized territory of Hennepin County;
111.27    (f) Scott County. Prior Lake, Savage, Shakopee;
111.28    (g) Washington County. Baytown, the city of Stillwater, White Bear Lake, Bayport,
111.29Birchwood, Cottage Grove, Dellwood, Lake Elmo, Landfall, Mahtomedi, Newport,
111.30Oakdale, Oak Park Heights, Pine Springs, St. Paul Park, Willernie, Woodbury means the
111.31metropolitan area.
111.32    The Metropolitan Council in its sole discretion may provide transit service by
111.33contract beyond the boundaries of the metropolitan transit taxing district or to cities and
111.34towns within the taxing district which are receiving financial assistance under section
111.35473.388 , upon petition therefor by an interested city, township or political subdivision
112.1within the metropolitan transit area. The Metropolitan Council may establish such
112.2terms and conditions as it deems necessary and advisable for providing the transit
112.3service, including such combination of fares and direct payments by the petitioner as
112.4will compensate the council for the full capital and operating cost of the service and the
112.5related administrative activities of the council. The amount of the levy made by any
112.6municipality to pay for the service shall be disregarded when calculation of levies subject
112.7to limitations is made, provided that cities and towns receiving financial assistance under
112.8section 473.388 shall not make a special levy under this subdivision without having first
112.9exhausted the available local transit funds as defined in section 473.388. The council shall
112.10not be obligated to extend service beyond the boundaries of the taxing district, or to cities
112.11and towns within the taxing district which are receiving financial assistance under section
112.12473.388 , under any law or contract unless or until payment therefor is received.
112.13EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
112.14thereafter.

112.15    Sec. 60. Minnesota Statutes 2006, section 473.446, subdivision 8, is amended to read:
112.16    Subd. 8. State review. The commissioner of revenue shall certify the council's levy
112.17limitation under this section to the council by August 1 of the levy year. The council
112.18must certify its proposed property tax levy under this section to the commissioner of
112.19revenue by September 1 of the levy year. The commissioner of revenue shall annually
112.20determine whether the property tax for transit purposes certified by the council for levy
112.21following the adoption of its proposed budget is within the levy limitation imposed by
112.22subdivisions subdivision 1 and 1b. The commissioner shall also annually determine
112.23whether the transit tax imposed on all taxable property within the metropolitan transit area
112.24but outside of the metropolitan transit taxing district is within the levy limitation imposed
112.25by subdivision 1a. The determination must be completed prior to September 10 of each
112.26year. If current information regarding market valuation in any county is not transmitted to
112.27the commissioner in a timely manner, the commissioner may estimate the current market
112.28valuation within that county for purposes of making the calculations.
112.29EFFECTIVE DATE.This section is effective for taxes payable in 2009 and
112.30thereafter.

112.31    Sec. 61. Laws 2008, chapter 154, article 2, section 11, the effective date, is amended to
112.32read:
112.33EFFECTIVE DATE.The amendments of this section to paragraph (b) and to the
112.34class rate decrease and the market value increase of the first tier of class 1c homestead
113.1resorts are effective for taxes payable in 2009 and thereafter. The rest of this section is
113.2effective for taxes payable in 2010 and thereafter.
113.3EFFECTIVE DATE.This section is effective the day following final enactment.

113.4    Sec. 62. FISCAL DISPARITIES STUDY.
113.5    The commissioner of revenue shall conduct a study of the metropolitan revenue
113.6distribution program contained in Minnesota Statutes, chapter 473F, commonly known
113.7as the fiscal disparities program. On or before February 1, 2010, the commissioner shall
113.8make a report to the chairs of the house of representatives and senate tax committees
113.9consisting of the findings of the study and any recommendations resulting from the study.
113.10    The study must consider to what extent the program is meeting the following goals,
113.11and what changes could be made to the program in the furtherance of meeting those goals:
113.12    (1) reducing the extent to which the property tax encourages development patterns
113.13that do not make cost-effective use of public infrastructure or impose other high public
113.14costs;
113.15    (2) ensuring that the benefits of economic growth of the region are shared throughout
113.16the region, especially for growth that results from state or regional decisions;
113.17    (3) improving the ability of each jurisdiction within the region to deliver services at
113.18a level commensurate with its tax effort;
113.19    (4) compensating jurisdictions containing properties that provide regional benefits
113.20for the costs those properties impose on their host jurisdictions in excess of their tax
113.21payments;
113.22    (5) promoting a fair distribution of property tax burdens across jurisdictions of
113.23the region; and
113.24    (6) reducing the economic losses that result from competition among communities
113.25for commercial-industrial tax base.
113.26EFFECTIVE DATE.This section is effective July 1, 2008.

113.27    Sec. 63. WHITE COMMUNITY HOSPITAL DISTRICT.
113.28    Subdivision 1. Authorized. Notwithstanding the contiguity requirement in
113.29Minnesota Statutes, section 447.31, subdivision 2, any two or more of the following cities
113.30and towns in St. Louis County may establish by resolution of their respective governing
113.31bodies the White Community Hospital District: the cities of Aurora, Biwabik, and Hoyt
113.32Lakes, and the towns of Biwabik, White, and Colvin. The proposed resolution to establish
113.33the hospital district must be published and is subject to referendum as provided in section
113.34447.31, subdivision 2.
114.1    Subd. 2. Powers; may make grants. (a) Except as otherwise provided in this
114.2section, the White Community Hospital District shall be organized and have the powers
114.3and duties provided in Minnesota Statutes, sections 447.31, except subdivisions 2, 5, and
114.46; 447.32, subdivisions 5, 7, and 9; 447.345; 447.37; and 447.38.
114.5    (b) The hospital district may levy taxes as provided in this section to provide funding
114.6to make grants to the White Community Hospital and any affiliated health care facility or
114.7provider for any purpose authorized for hospital districts in Minnesota Statutes, sections
114.8447.31 to 447.38, except 447.331. A grant must not be made under this section until the
114.9governing body of the White Community Hospital, and any of its affiliated health care
114.10facilities or providers receiving a grant, have entered into a written agreement with the
114.11hospital district board stating that the governing body will comply with and is subject to
114.12all provisions of the Minnesota open meeting law in Minnesota Statutes, chapter 13D.
114.13    Subd. 3. Annexation; detachment. Once the hospital district is established, any
114.14other city, town, or unorganized area in St. Louis County may join the hospital district
114.15in the same manner provided in subdivision 1 for establishment of the hospital district.
114.16A city, town, or unorganized area that is a member of the hospital district may detach
114.17from the district in the same manner as it may join. An annexation to or detachment
114.18from the hospital district is effective for taxes payable in the following calendar year if
114.19the resolution is adopted, or in the case of an unorganized area the petition submitted
114.20to the county auditor, before July 1 of the levy year. A resolution adopted or petition
114.21submitted after July 1 of any year is effective for the taxes payable the year following
114.22the next levy year.
114.23    Subd. 4. Unorganized areas. An unorganized area in St. Louis County shall
114.24become a member of the hospital district if at least 51 percent of the residents of the
114.25unorganized area signed a petition submitted to the hospital district board and the county
114.26auditor requesting to participate in the hospital district.
114.27    Subd. 5. Hospital district board. The hospital district shall be governed by a
114.28hospital board composed of one member of each participating city and town's governing
114.29body, appointed by the governing body. If the hospital district only has two members,
114.30each member city or town shall appoint two board members. The hospital district board
114.31must appoint from among its members a chair, clerk, treasurer, and any other officers the
114.32board deems necessary or useful. The St. Louis County Board of Commissioners shall
114.33appoint a resident of any unorganized area that is participating in the hospital district. All
114.34board members serve at the pleasure of the respective appointing authorities.
115.1    Subd. 6. No compensation; expenses. Board members shall serve without
115.2compensation but shall be eligible for per diem and expenses provided by, and at the
115.3discretion of, their respective appointing authorities.
115.4    Subd. 7. Operating tax levy. The hospital district board may levy a tax as
115.5provided in Minnesota Statutes, section 447.34, except as provided in this subdivision.
115.6If the hospital district board levies it must be a uniform tax rate levied against the net
115.7tax capacity of all taxable properties located within each participating city, town, or
115.8unorganized area. The maximum amount that may be levied in the hospital district must
115.9not exceed 0.066088 percent of the fully taxable market value of all taxable properties
115.10located within each participating city, town, or unorganized area.
115.11    Any tax levied by the hospital district is in addition to all other taxes levied on the
115.12property, including taxes levied for any other hospital purpose by a participating city
115.13or town. The levy must be disregarded in the calculation of all other rate or per capita
115.14levy limitations imposed by law.
115.15EFFECTIVE DATE; NO LOCAL APPROVAL.This section is effective the
115.16day following final enactment without local approval under Minnesota Statutes, section
115.17645.023, subdivision 1, paragraph (a), for taxes levied in 2008, payable in 2009, and
115.18thereafter.

115.19    Sec. 64. VADNAIS LAKE AREA WATER MANAGEMENT ORGANIZATION;
115.20STORM SEWER UTILITY FEES.
115.21    Notwithstanding any other law to the contrary and pursuant to joint powers
115.22agreements authorized under Minnesota Statutes, sections 103B.211 and 471.59, the
115.23Vadnais Lake Area Water Management Organization may certify to the county auditor any
115.24fees or charges imposed by the organization under Minnesota Statutes, section 103B.211
115.25or 444.075, and the parcels on which the charges are imposed. The county auditor shall
115.26extend the charges on the property tax statements. The amounts must be certified by
115.27November 30 to appear on statements for taxes payable in the following year. The charges,
115.28if not paid, become delinquent and are subject to the same penalties, the same rate of
115.29interest, and become a lien upon the property in the same manner, as real property taxes.
115.30The charges shall be paid to the Vadnais Lake Area Water Management Organization by
115.31the county auditor in the same manner and at the same time as property taxes. The county
115.32auditor may charge the Vadnais Lake Area Water Management Organization a fee in the
115.33amount necessary to recover the costs of administering the charges.
115.34EFFECTIVE DATE.This section is effective the day following final enactment.

116.1    Sec. 65. CITY OF BROOKLYN CENTER; PARTICIPATION IN CRIME-FREE
116.2MULTIHOUSING PROGRAM.
116.3    (a) In addition to the requirements of Minnesota Statutes, section 273.128, if
116.4property located in the city of Brooklyn Center qualifies under paragraph (b), the owners
116.5or managers must complete the three phases of the city's crime-free multihousing program
116.6and the qualifying property must be annually certified by the police as participating
116.7in the program. If a qualifying property is not certified within one year after it is first
116.8determined to be a qualifying property under paragraph (b), or does not annually maintain
116.9its certification in the program, the city shall notify the property owner that the qualifying
116.10property must comply with the requirements of this section to maintain its classification
116.11as class 4d property. If a qualifying property is not in compliance within one year after
116.12receiving the notice from the city, the city shall issue a second notice and require the
116.13owners to enter into a plan to achieve compliance within one year. If, upon expiration
116.14of the one-year time period, the qualifying property has not been certified by the police
116.15as completing the program, the city shall notify the commissioner of the Housing
116.16Finance Agency and the commissioner shall remove the property from the list of class 4d
116.17properties certified to the assessor under Minnesota Statutes, section 273.128, subdivision
116.183. Once removed from the list, the property is not eligible for class 4d classification until
116.19it complies with this section and its compliance has been certified to the Housing Finance
116.20Agency by the city. Certification to the Housing Finance Agency must be made by May
116.2115 to be effective for taxes payable in the following year.
116.22    (b) A property is a qualifying property for purposes of this section's requirements if
116.23it satisfies each of the following requirements:
116.24    (1) the city offers a crime-free multihousing program through its city police;
116.25    (2) over the preceding three-year period, the number of police calls to the property
116.26exceeded the city's average number of calls for multiunit rental properties for the period
116.27by at least 25 percent, adjusted for the number of rental units;
116.28    (3) the police department has requested, in writing, the owners or managers of the
116.29property to enroll in the crime-free multihousing program and the owners or managers
116.30refused or failed to enroll within 60 days after the request, or failed to complete phases
116.31one and three within 90 days and all three phases of the program within a one-year time
116.32period; and
116.33    (4) the governing body of the city, by resolution, determines the property is a
116.34qualifying property under clauses (1) to (3).
116.35    (c) Calls for police or emergency assistance in response to domestic abuse or
116.36medical assistance shall not be counted toward the number of calls in paragraph (b), clause
117.1(2). For purposes of this section, "domestic abuse" has the meaning given in Minnesota
117.2Statutes, section 518B.01, subdivision 2.
117.3    (d) Low-income qualifying rental housing property classified as class 4d property
117.4for taxes payable in 2008 must meet the requirements of this section by May 15, 2011.
117.5EFFECTIVE DATE; LOCAL APPROVAL.This section is effective the day after
117.6compliance by the governing body of the city of Brooklyn Center and its chief clerical
117.7officer with Minnesota Statutes, section 645.021, subdivisions 2 and 3.

117.8    Sec. 66. ASSESSMENT OF PROPERTIES OF PURELY PUBLIC CHARITIES.
117.9    Subdivision 1. Application. (a) To facilitate a review by the 2009 legislature of
117.10the property tax exemption for property of nonprofit organizations as purely public
117.11charities and the development of standards and criteria for the tax status of these facilities,
117.12this section:
117.13    (1) requires the commissioner of revenue to conduct an analysis of standards applied
117.14to determine the tax status of these organizations; and
117.15    (2) prohibits changes in assessment practices and policies regarding the property of
117.16these organizations.
117.17    (b) The purpose of this study is to allow the legislature to evaluate whether the
117.18judicially established rules and the assessment practices and policies in applying those
117.19rules to determine the tax status of these properties ensure that public benefits are, at
117.20least, commensurate with the costs of the exemption. The legislature does not intend, in
117.21requiring this study, to indicate an intention to expand or to narrow the existing rules for
117.22exempting institutions of purely public charity.
117.23    Subd. 2. Report by commissioner of revenue. (a) The commissioner of revenue
117.24shall survey all county assessors on:
117.25    (1) the tax status of property of institutions of purely public charity located in the
117.26state, including detail on the type of organization and the use of the property; and
117.27    (2) their practices and policies in determining the tax status of property of institutions
117.28of purely public charity, including the extent to which the assessment practices and
117.29policies require the institutions to provide goods or services at free or below market prices
117.30and on the treatment of government payments.
117.31    (b) The commissioner shall report the findings to the chairs of the house and senate
117.32committees with jurisdiction over taxation by February 1, 2009.
117.33    Subd. 3. Moratorium on changes in assessment practices. (a) An assessor
117.34may not change the current practices or policies used generally in assessing property
117.35of institutions of purely public charities.
118.1    (b) An assessor may not change the assessment of the taxable status of an existing
118.2property of an organization of purely public charity, unless the change is made as a result of
118.3a change in ownership, occupancy or use of the facility, or to correct an error. For currently
118.4taxable properties, the assessor may change the estimated market value of the property.
118.5    (c) This subdivision expires on the earlier of:
118.6    (1) the enactment of legislation establishing criteria for the property taxation of
118.7purely public charities; or
118.8    (2) adjournment of the 2009 regular legislative session to a date in calendar year
118.92010.
118.10EFFECTIVE DATE.This section is effective for the 2008 assessment, taxes
118.11payable in 2009.

118.12    Sec. 67. FEDERAL AUDIT; SCHOOL DISTRICT LEVY.
118.13    Subdivision 1. Calculation. The commissioner of education must calculate the total
118.14amount of revenue that each school district needs to replace federal funds that have been
118.15disallowed resulting from the settlement of an audit by the federal Office of Inspector
118.16General of Local Collaborative Time Study school-based services claimed in Minnesota.
118.17    Subd. 2. State aid. The commissioner of education must make a state aid payment
118.18to each school district in fiscal year 2009 equal to one-third of the amount calculated in
118.19subdivision 1.
118.20    Subd. 3. Levy. A school district may levy a property tax for taxes payable in 2010
118.21and 2011 only, not to exceed one-third of the amount calculated in subdivision 1 in each
118.22year.
118.23    Subd. 4. Appropriation. The amount necessary to fund the payments required
118.24under subdivision 2 is appropriated in fiscal year 2009 to the commissioner of education.
118.25EFFECTIVE DATE.This section is effective the day following final enactment.

118.26    Sec. 68. SCHOOL DISTRICT LEASE PURCHASES; REVERSE
118.27REFERENDUM.
118.28    Subdivision 1. Limitation. After the effective date of this section, a school district
118.29located wholly or partially within the borders of a city of the first class with a population
118.30of less than 100,000 inhabitants must not enter into a binding legal agreement under
118.31Minnesota Statutes, section 126C.40, subdivision 6, without first holding a school board
118.32meeting authorizing that contract and adopting a written resolution authorizing the
118.33contract.
119.1    Subd. 2. Board Meeting. The school board must allow for public testimony on
119.2the proposed contract before adopting a written resolution authorizing the contract. The
119.3resolution becomes final 45 days after its adoption unless a petition has been filed under
119.4subdivision 3.
119.5    Subd. 3. Reverse referendum. A referendum on the question of authorizing the
119.6lease purchase contract must be called by the board upon the written petition of qualified
119.7voters of the district. A referendum to enter into a lease purchase contract must state the
119.8amount of the contract. A petition authorized by this subdivision is effective if signed
119.9by a number of qualified voters in excess of 15 percent of the registered voters of the
119.10district on the day the petition is filed with the board. A referendum invoked by petition
119.11must be held on a date determined by the school board. If an effective petition is filed
119.12with the board by August 15, 2008, the board must hold the election at the time of the
119.132008 state primary. The approval of 50 percent plus one of those voting on the question is
119.14required to authorize the contract.
119.15EFFECTIVE DATE.This section is effective the day following final enactment.

119.16    Sec. 69. REPEALER.
119.17(a) Minnesota Statutes 2006, section 273.11, subdivisions 14 and 14a, are repealed.
119.18(b) Minnesota Statutes 2006, section 273.111, subdivision 6, is repealed.
119.19(c) Minnesota Statutes 2006, section 473.4461, is repealed.
119.20EFFECTIVE DATE.Paragraphs (a) and (c) are effective for taxes payable in 2009
119.21and thereafter. Paragraph (b) is effective for taxes payable in 2010 and thereafter.


119.24    Section 1. Minnesota Statutes 2006, section 297A.70, subdivision 2, is amended to
119.25read:
119.26    Subd. 2. Sales to government. (a) All sales, except those listed in paragraph (b),
119.27to the following governments and political subdivisions, or to the listed agencies or
119.28instrumentalities of governments and political subdivisions, are exempt:
119.29    (1) the United States and its agencies and instrumentalities;
119.30    (2) school districts, the University of Minnesota, state universities, community
119.31colleges, technical colleges, state academies, the Perpich Minnesota Center for Arts
119.32Education, and an instrumentality of a political subdivision that is accredited as an
119.33optional/special function school by the North Central Association of Colleges and Schools;
120.1    (3) hospitals and nursing homes owned and operated by political subdivisions of
120.2the state of tangible personal property and taxable services used at or by hospitals and
120.3nursing homes;
120.4    (4) the Metropolitan Council or the Department of Transportation, for its purchases
120.5of vehicles and repair parts to equip operations provided for in section sections 174.90 and
120.6 473.4051, including, but not limited to, the Northstar Corridor rail project;
120.7    (5) other states or political subdivisions of other states, if the sale would be exempt
120.8from taxation if it occurred in that state; and
120.9    (6) sales to public libraries, public library systems, multicounty, multitype library
120.10systems as defined in section 134.001, county law libraries under chapter 134A, state
120.11agency libraries, the state library under section 480.09, and the Legislative Reference
120.12Library.
120.13    (b) This exemption does not apply to the sales of the following products and services:
120.14    (1) building, construction, or reconstruction materials purchased by a contractor
120.15or a subcontractor as a part of a lump-sum contract or similar type of contract with a
120.16guaranteed maximum price covering both labor and materials for use in the construction,
120.17alteration, or repair of a building or facility;
120.18    (2) construction materials purchased by tax exempt entities or their contractors to
120.19be used in constructing buildings or facilities which will not be used principally by the
120.20tax exempt entities;
120.21    (3) the leasing of a motor vehicle as defined in section 297B.01, subdivision 5,
120.22except for leases entered into by the United States or its agencies or instrumentalities; or
120.23    (4) lodging as defined under section 297A.61, subdivision 3, paragraph (g), clause
120.24(2), and prepared food, candy, and soft drinks, except for lodging, prepared food, candy,
120.25and soft drinks purchased directly by the United States or its agencies or instrumentalities.
120.26    (c) As used in this subdivision, "school districts" means public school entities and
120.27districts of every kind and nature organized under the laws of the state of Minnesota, and
120.28any instrumentality of a school district, as defined in section 471.59.
120.29EFFECTIVE DATE.This section is effective retroactively for sales and purchases
120.30made after January 1, 2007.

120.31    Sec. 2. Minnesota Statutes 2006, section 297A.70, subdivision 8, is amended to read:
120.32    Subd. 8. Regionwide public safety radio communication system; products and
120.33services. Products and services including, but not limited to, end user equipment used
120.34for construction, ownership, operation, maintenance, and enhancement of the backbone
120.35system of the regionwide public safety radio communication system established under
121.1sections 403.21 to 403.34 403.40, are exempt. For purposes of this subdivision, backbone
121.2system is defined in section 403.21, subdivision 9. This subdivision is effective for
121.3purchases, sales, storage, use, or consumption for use in the first and second phases of the
121.4system, as defined in section 403.21, subdivisions 3, 10, and 11, and that portion of the
121.5third phase of the system that is located in the southeast district of the State Patrol and
121.6the counties of Benton, Sherburne, Stearns, and Wright, and that portion of the system
121.7that is located in Itasca County.
121.8EFFECTIVE DATE.This section is effective for sales and purchases made after
121.9June 30, 2007.

121.10    Sec. 3. Minnesota Statutes 2006, section 297A.71, is amended by adding a subdivision
121.11to read:
121.12    Subd. 40. Construction materials; Central Corridor light rail transit. Materials
121.13and supplies used or consumed in, and equipment incorporated into, the construction
121.14or improvement of the Central Corridor light rail transit line and associated facilities
121.15including, but not limited to, stations, park-and-ride facilities, and maintenance facilities,
121.16are exempt. The tax must be imposed and collected as if the rate under section 297A.62,
121.17subdivision 1, applied and then refunded in the manner provided in section 297A.75.
121.18EFFECTIVE DATE.This section is effective retroactively for sales and purchases
121.19made after January 1, 2007.

121.20    Sec. 4. Minnesota Statutes 2006, section 297A.71, is amended by adding a subdivision
121.21to read:
121.22    Subd. 41. Construction materials; Northstar Corridor rail project. Materials
121.23and supplies used or consumed in, and equipment incorporated into, the construction or
121.24improvement of the Northstar Corridor rail project and associated facilities by a public
121.25entity or under a contract with a public entity including, but not limited to, track and signal
121.26improvements, stations, park-and-ride facilities, and maintenance facilities, are exempt.
121.27The tax must be imposed and collected as if the rate under section 297A.62, subdivision 1,
121.28applied and then refunded in the manner provided in section 297A.75.
121.29EFFECTIVE DATE.This section is effective retroactively for sales and purchases
121.30made after January 1, 2007.

121.31    Sec. 5. Minnesota Statutes 2006, section 297A.75, is amended to read:
121.32297A.75 REFUND; APPROPRIATION.
122.1    Subdivision 1. Tax collected. The tax on the gross receipts from the sale of the
122.2following exempt items must be imposed and collected as if the sale were taxable and the
122.3rate under section 297A.62, subdivision 1, applied. The exempt items include:
122.4    (1) capital equipment exempt under section 297A.68, subdivision 5;
122.5    (2) building materials for an agricultural processing facility exempt under section
122.6297A.71, subdivision 13 ;
122.7    (3) building materials for mineral production facilities exempt under section
122.8297A.71, subdivision 14 ;
122.9    (4) building materials for correctional facilities under section 297A.71, subdivision
122.103 ;
122.11    (5) building materials used in a residence for disabled veterans exempt under section
122.12297A.71, subdivision 11 ;
122.13    (6) elevators and building materials exempt under section 297A.71, subdivision 12;
122.14    (7) building materials for the Long Lake Conservation Center exempt under section
122.15297A.71, subdivision 17 ;
122.16    (8) materials, supplies, fixtures, furnishings, and equipment for a county law
122.17enforcement and family service center under section 297A.71, subdivision 26;
122.18    (9) materials and supplies for qualified low-income housing under section 297A.71,
122.19subdivision 23 ;
122.20    (10) materials, supplies, and equipment for municipal electric utility facilities under
122.21section 297A.71, subdivision 35;
122.22    (11) equipment and materials used for the generation, transmission, and distribution
122.23of electrical energy and an aerial camera package exempt under section 297A.68,
122.24subdivision 37; and
122.25    (12) tangible personal property and taxable services and construction materials,
122.26supplies, and equipment exempt under section 297A.68, subdivision 41.; and
122.27    (13) materials, supplies, and equipment for construction or improvement of projects
122.28and facilities under section 297A.71, subdivisions 40 and 41.
122.29    Subd. 2. Refund; eligible persons. Upon application on forms prescribed by the
122.30commissioner, a refund equal to the tax paid on the gross receipts of the exempt items
122.31must be paid to the applicant. Only the following persons may apply for the refund:
122.32    (1) for subdivision 1, clauses (1) to (3), the applicant must be the purchaser;
122.33    (2) for subdivision 1, clauses (4), (7), and (8), the applicant must be the governmental
122.34subdivision;
122.35    (3) for subdivision 1, clause (5), the applicant must be the recipient of the benefits
122.36provided in United States Code, title 38, chapter 21;
123.1    (4) for subdivision 1, clause (6), the applicant must be the owner of the homestead
123.2property;
123.3    (5) for subdivision 1, clause (9), the owner of the qualified low-income housing
123.4project;
123.5    (6) for subdivision 1, clause (10), the applicant must be a municipal electric utility or
123.6a joint venture of municipal electric utilities; and
123.7    (7) for subdivision 1, clauses (11) and (12), the owner of the qualifying business.; and
123.8    (8) for subdivision 1, clause (13), the applicant must be the governmental entity that
123.9owns or contracts for the project or facility.
123.10    Subd. 3. Application. (a) The application must include sufficient information
123.11to permit the commissioner to verify the tax paid. If the tax was paid by a contractor,
123.12subcontractor, or builder, under subdivision 1, clause (4), (5), (6), (7), (8), (9), (10),
123.13(11), or (12), or (13), the contractor, subcontractor, or builder must furnish to the refund
123.14applicant a statement including the cost of the exempt items and the taxes paid on the
123.15items unless otherwise specifically provided by this subdivision. The provisions of
123.16sections 289A.40 and 289A.50 apply to refunds under this section.
123.17    (b) An applicant may not file more than two applications per calendar year for
123.18refunds for taxes paid on capital equipment exempt under section 297A.68, subdivision 5.
123.19    Subd. 4. Interest. Interest must be paid on the refund at the rate in section 270C.405
123.20from 90 days after the refund claim is filed with the commissioner for taxes paid under
123.21subdivision 1.
123.22    Subd. 5. Appropriation. (a) The amount required to make the refunds, except for
123.23refunds under subdivision 1, clause (13), is annually appropriated to the commissioner.
123.24    (b) $....... in fiscal year 2009 is appropriated from the general fund to the
123.25commissioner. The appropriation under this paragraph shall be used to make refunds of
123.26sales tax for the exemptions under subdivision 1, clause (13). The appropriation does not
123.27cancel and is available until expended. In fiscal years 2010 and 2011, the commissioner
123.28shall make payments from the appropriation under this paragraph to the general fund
123.29to reimburse it for the revenue loss in those years due to the extension of the sales tax
123.30exemption to the Department of Transportation under section 297A.70, subdivision
123.312, clause (4).
123.32EFFECTIVE DATE.This section is effective the day following final enactment.

123.33    Sec. 6. Minnesota Statutes 2006, section 297A.99, subdivision 1, as amended by Laws
123.342008, chapter 152, article 4, section 1, is amended to read:
124.1    Subdivision 1. Authorization; scope. (a) A political subdivision of this state may
124.2impose a general sales tax (1) under section 297A.992, (2) under section 297A.993,
124.3(3) if permitted by special law enacted prior to May 20, 2008, or (4) if the political
124.4subdivision enacted and imposed the tax before the effective date of section 477A.016 and
124.5its predecessor provision.
124.6    (b) This section governs the imposition of a general sales tax by the political
124.7subdivision. The provisions of this section preempt the provisions of any special law:
124.8    (1) enacted before June 2, 1997, or
124.9    (2) enacted on or after June 2, 1997, that does not explicitly exempt the special law
124.10provision from this section's rules by reference.
124.11    (c) This section does not apply to or preempt a sales tax on motor vehicles or a
124.12special excise tax on motor vehicles.
124.13    (d) Until after December 31, 2011, a political subdivision may not advertise,
124.14promote, expend funds, or hold a referendum to support imposing a local option sales tax
124.15unless the tax was authorized by a special law enacted prior to May 20, 2008.
124.16EFFECTIVE DATE.This section is effective the day following final enactment.

124.17    Sec. 7. Minnesota Statutes 2006, section 297B.03, is amended to read:
124.18297B.03 EXEMPTIONS.
124.19    There is specifically exempted from the provisions of this chapter and from
124.20computation of the amount of tax imposed by it the following:
124.21    (1) purchase or use, including use under a lease purchase agreement or installment
124.22sales contract made pursuant to section 465.71, of any motor vehicle by the United States
124.23and its agencies and instrumentalities and by any person described in and subject to the
124.24conditions provided in section 297A.67, subdivision 11;
124.25    (2) purchase or use of any motor vehicle by any person who was a resident of
124.26another state or country at the time of the purchase and who subsequently becomes a
124.27resident of Minnesota, provided the purchase occurred more than 60 days prior to the date
124.28such person began residing in the state of Minnesota and the motor vehicle was registered
124.29in the person's name in the other state or country;
124.30    (3) purchase or use of any motor vehicle by any person making a valid election to be
124.31taxed under the provisions of section 297A.90;
124.32    (4) purchase or use of any motor vehicle previously registered in the state of
124.33Minnesota when such transfer constitutes a transfer within the meaning of section 118,
124.34331, 332, 336, 337, 338, 351, 355, 368, 721, 731, 1031, 1033, or 1563(a) of the Internal
124.35Revenue Code of 1986, as amended through December 31, 1999;
125.1    (5) purchase or use of any vehicle owned by a resident of another state and leased
125.2to a Minnesota-based private or for-hire carrier for regular use in the transportation of
125.3persons or property in interstate commerce provided the vehicle is titled in the state of
125.4the owner or secured party, and that state does not impose a sales tax or sales tax on
125.5motor vehicles used in interstate commerce;
125.6    (6) purchase or use of a motor vehicle by a private nonprofit or public educational
125.7institution for use as an instructional aid in automotive training programs operated by the
125.8institution. "Automotive training programs" includes motor vehicle body and mechanical
125.9repair courses but does not include driver education programs;
125.10    (7) purchase of a motor vehicle for use as an ambulance by an ambulance service
125.11licensed under section 144E.10;
125.12    (8) purchase of a motor vehicle by or for a public library, as defined in section
125.13134.001, subdivision 2 , as a bookmobile or library delivery vehicle;
125.14    (9) purchase of a ready-mixed concrete truck;
125.15    (10) purchase or use of a motor vehicle by a town for use exclusively for road
125.16maintenance, including snowplows and dump trucks, but not including automobiles,
125.17vans, or pickup trucks;
125.18    (11) purchase or use of a motor vehicle by a corporation, society, association,
125.19foundation, or institution organized and operated exclusively for charitable, religious,
125.20or educational purposes, except a public school, university, or library, but only if the
125.21vehicle is:
125.22    (i) a truck, as defined in section 168.011, a bus, as defined in section 168.011, or a
125.23passenger automobile, as defined in section 168.011, if the automobile is designed and
125.24used for carrying more than nine persons including the driver; and
125.25    (ii) intended to be used primarily to transport tangible personal property or
125.26individuals, other than employees, to whom the organization provides service in
125.27performing its charitable, religious, or educational purpose;
125.28    (12) purchase of a motor vehicle for use by a transit provider exclusively to provide
125.29transit service is exempt if the transit provider is either (i) receiving financial assistance or
125.30reimbursement under section 174.24 or 473.384, or (ii) operating under section 174.29,
125.31473.388 , or 473.405;
125.32    (13) purchase or use of a motor vehicle by a qualified business, as defined in section
125.33469.310 , located in a job opportunity building zone, if the motor vehicle is principally
125.34garaged in the job opportunity building zone and is primarily used as part of or in direct
125.35support of the person's operations carried on in the job opportunity building zone. The
125.36exemption under this clause applies to sales, if the purchase was made and delivery
126.1received during the duration of the job opportunity building zone. The exemption under
126.2this clause also applies to any local sales and use tax.;
126.3    (14) purchase outside the United States of a passenger automobile, as defined in
126.4section 168.011, subdivision 7, or motorcycle, as defined in section 168.011, subdivision
126.526, by a member of the United States armed forces while the member is serving outside the
126.6United States in federal active military service, as defined in section 190.05, subdivision
126.75c, limited to one qualifying motor vehicle during the servicemember's lifetime; and
126.8    (15) purchase of a leased vehicle by the lessee who was a participant in a
126.9lease-to-own program from a charitable organization that is:
126.10    (i) described in section 501(c)(3) of the Internal Revenue Code; and
126.11    (ii) licensed as a motor vehicle lessor under section 168.27, subdivision 4.
126.12EFFECTIVE DATE.(a) Clauses (1) to (14) are effective for sales and purchases
126.13made after December 31, 2007, and for other motor vehicles for which the tax first
126.14becomes due after December 31, 2007.
126.15    (b) Clause (15) is effective for sales and purchases made after June 30, 2008.

126.16    Sec. 8. Laws 1991, chapter 291, article 8, section 27, subdivision 3, as amended by
126.17Laws 1998, chapter 389, article 8, section 28, is amended to read:
126.18    Subd. 3. Use of revenues. Revenues received from taxes authorized by subdivisions
126.191 and 2 shall be used by the city to pay the cost of collecting the tax and to pay all or a
126.20portion of the expenses of constructing and operating improving facilities as part of an
126.21urban revitalization project in downtown Mankato known as Riverfront 2000. Authorized
126.22expenses include, but are not limited to, acquiring property and paying relocation expenses
126.23related to the development of Riverfront 2000 and related facilities, and securing or paying
126.24debt service on bonds or other obligations issued to finance the construction of Riverfront
126.252000 and related facilities. For purposes of this section, "Riverfront 2000 and related
126.26facilities" means a civic-convention center, an arena, a riverfront park, a technology center
126.27and related educational facilities, and all publicly owned real or personal property that
126.28the governing body of the city determines will be necessary to facilitate the use of these
126.29facilities, including but not limited to parking, skyways, pedestrian bridges, lighting, and
126.30landscaping. It also includes the performing arts theatre and the Southern Minnesota
126.31Women's Hockey Exposition Center, attached to the Mankato Civic Center for use by
126.32Minnesota State University, Mankato.
126.33EFFECTIVE DATE.This section is effective the day after the governing body of
126.34the city of Mankato and its chief clerical officer comply with Minnesota Statutes, section
126.35645.021, subdivisions 2 and 3, and after compliance with section 10.

127.1    Sec. 9. Laws 1991, chapter 291, article 8, section 27, subdivision 4, as amended by
127.2Laws 2005, First Special Session chapter 3, article 5, section 25, is amended to read:
127.3    Subd. 4. Expiration of taxing authority and expenditure limitation. The
127.4authority granted by subdivisions 1 and 2 to the city to impose a sales tax and an excise
127.5tax shall expire on December 31, 2015, unless sufficient revenues are not available to
127.6defease any bonds or obligations issued to finance construction of Riverfront 2000 and
127.7related facilities. If sufficient funds are not available to defease the bonds, the tax expires
127.8December 31, 2018, but all revenues from taxes imposed after December 31, 2015, must be
127.9used to defease the bonds. The city may, by ordinance, terminate the tax at an earlier date.
127.10EFFECTIVE DATE.This section is effective the day after the governing body of
127.11the city of Mankato and its chief clerical officer comply with Minnesota Statutes, section
127.12645.021, subdivisions 2 and 3, and after compliance with section 10.

127.13    Sec. 10. CITY OF MANKATO, LOCAL TAXES AUTHORIZED.
127.14    Subdivision 1. Food and beverage tax authorized. Notwithstanding Minnesota
127.15Statutes, section 477A.016, or any ordinance, city charter, or other provision of law, the
127.16city of Mankato may, by ordinance, impose a sales tax of up to one percent on the gross
127.17receipts on all sales of food and beverages by a restaurant or place of refreshment, as
127.18defined by resolution of the city, that are located within the city. For purposes of this
127.19section, "food and beverages" include retail on-sale of intoxicating liquor and fermented
127.20malt beverages.
127.21    Subd. 2. Entertainment tax. Notwithstanding Minnesota Statutes, section
127.22477A.016, or any ordinance, city charter, or other provision of law, the city of Mankato
127.23may, by ordinance, impose a tax of up to one percent on the gross receipts on admissions to
127.24an entertainment event located within the city. For purposes of this section "entertainment
127.25event" means any event for which persons pay money in order to be admitted to the
127.26premises and to be entertained including, but not limited to, theaters, concerts, and
127.27sporting events.
127.28    Subd. 3. Use of proceeds from authorized taxes. The proceeds of any tax imposed
127.29under subdivisions 1 and 2 shall be used by the city to pay all or a portion of the expenses
127.30of operation and maintenance of the Riverfront 2000 and related facilities, including a
127.31performing arts theatre and the Southern Minnesota Women's Hockey Exposition Center,
127.32attached to the Mankato Civic Center for use by Minnesota State University, Mankato.
127.33Authorized expenses include securing or paying debt service on bonds or other obligations
127.34issued to finance the construction of the facilities.
128.1    Subd. 4. Collection, administration, and enforcement. If the city desires, it may
128.2enter into an agreement with the commissioner of revenue to administer, collect, and
128.3enforce the taxes authorized under subdivisions 1 and 2. If the commissioner agrees
128.4to collect the tax, the provisions of Minnesota Statutes, section 297A.99, related to
128.5collection, administration, and enforcement apply.
128.6EFFECTIVE DATE.This section is effective the day after the governing body of
128.7the city of Mankato and its chief clerical officer comply with Minnesota Statutes, section
128.8645.021, subdivisions 2 and 3.

128.9    Sec. 11. COOK COUNTY; LODGING AND ADMISSIONS TAXES.
128.10    Subdivision 1. Lodging tax. Notwithstanding Minnesota Statutes, section
128.11477A.016, or any other provision of law, ordinance, or city charter, the Board of
128.12Commissioners of Cook County may impose, by ordinance, a tax of up to one percent on
128.13the gross receipts subject to the lodging tax under Minnesota Statutes, section 469.190.
128.14This tax is in addition to any tax imposed under Minnesota Statutes, section 469.190, and
128.15the total tax imposed under that section and this provision must not exceed four percent.
128.16    Subd. 2. Admissions and recreation tax. Notwithstanding Minnesota Statutes,
128.17section 477A.016, or any other provision of law, ordinance, or city charter, the Board of
128.18Commissioners of Cook County may impose, by ordinance, a tax of up to three percent on
128.19admissions to entertainment and recreational facilities and rental of recreation equipment.
128.20    Subd. 3. Use of taxes. The taxes imposed in subdivisions 1 and 2 must be used
128.21to fund a new Cook County Event and Visitors Bureau as established by the Board of
128.22Commissioners of Cook County. The Board of Commissioners of Cook County must
128.23annually review the budget of the Cook County Event and Visitors Bureau. The event and
128.24visitors bureau may not receive revenues raised from the taxes imposed in subdivisions 1
128.25and 2 until the board of commissioners approves the annual budget.
128.26    Subd. 4. Termination. The taxes imposed in subdivisions 1 and 2 terminate 15
128.27years after they are first imposed.
128.28EFFECTIVE DATE.This section is effective for sales and purchases after June
128.2930, 2008.

128.30    Sec. 12. CITY OF CLEARWATER; TAXES AUTHORIZED.
128.31    Subdivision 1. Sales and use tax. Notwithstanding Minnesota Statutes, section
128.32477A.016, or any other provision of law, ordinance, or city charter, pursuant to the
128.33approval of the voters on November 7, 2006, the city of Clearwater may impose by
128.34ordinance a sales and use tax of up to one-half of one percent for the purposes specified in
129.1subdivision 2. Except as otherwise provided in this section, the provisions of Minnesota
129.2Statutes, section 297A.99, govern the imposition, administration, collection, and
129.3enforcement of the tax authorized under this subdivision.
129.4    Subd. 2. Excise tax authorized. Notwithstanding Minnesota Statutes, section
129.5477A.016, or any other provision of law, ordinance, or city charter, the city of Clearwater
129.6may impose by ordinance, for the purposes specified in subdivision 3, an excise tax of up
129.7to $20 per motor vehicle, as defined by ordinance, purchased or acquired from any person
129.8engaged within the city in the business of selling motor vehicles at retail.
129.9    Subd. 3. Use of revenues. The proceeds of the tax imposed under this section shall
129.10be used to pay for the costs of acquisition, construction, improvement, and development
129.11of a pedestrian bridge, and land and buildings for a community and recreation center. The
129.12total amount of revenues from the taxes in subdivisions 1 and 2 that may be used to fund
129.13these projects is $12,000,000 plus any associated bond costs.
129.14    Subd. 4. Bonding authority. The city of Clearwater may issue bonds in an amount
129.15not to exceed $12,000,000 under Minnesota Statutes, chapter 475, to finance the capital
129.16expenditures and improvements authorized by the referendum under subdivision 1. An
129.17election to approve the bonds under Minnesota Statutes, section 475.59, is not required.
129.18The issuance of bonds under this subdivision is not subject to Minnesota Statutes, section
129.19275.60 or 275.61. The debt represented by the bonds must not be included in computing
129.20any debt limitations applicable to the city, and the levy of taxes required by Minnesota
129.21Statutes, section 475.61, to pay the principal or any interest on the bonds must not be
129.22subject to any levy limitation.
129.23    Subd. 5. Termination of tax. The tax authorized under subdivision 1 terminates at
129.24the earlier of (1) 20 years after the date of initial imposition of the tax, or (2) when the
129.25city council determines that sufficient funds have been raised from the tax to finance the
129.26capital and administrative costs of the improvements described in subdivision 3, plus the
129.27additional amount needed to pay the costs related to issuance of bonds under subdivision
129.284, including interest on the bonds. Any funds remaining after completion of the projects
129.29specified in subdivision 3 and retirement or redemption of the bonds in subdivision 4 may
129.30be placed in the general fund of the city. The tax imposed under subdivision 1 may expire
129.31at an earlier time if the city so determines by ordinance.
129.32EFFECTIVE DATE.This section is effective the day after compliance by the
129.33governing body of the city of Clearwater with Minnesota Statutes, section 645.021,
129.34subdivisions 2 and 3.

129.35    Sec. 13. CITY OF NORTH MANKATO; TAXES AUTHORIZED.
130.1    Subdivision 1. Sales and use tax authorized. Notwithstanding Minnesota Statutes,
130.2section 477A.016, or any other provision of law, ordinance, or city charter, pursuant to
130.3the approval of the voters on November 7, 2006, the city of North Mankato may impose
130.4by ordinance a sales and use tax of one-half of one percent for the purposes specified
130.5in subdivision 2. The provisions of Minnesota Statutes, section 297A.99, govern the
130.6imposition, administration, collection, and enforcement of the taxes authorized under
130.7this subdivision.
130.8    Subd. 2. Use of revenues. Revenues received from the tax authorized by
130.9subdivision 1 must be used to pay all or part of the capital costs of the following projects:
130.10    (1) the local share of the Trunk Highway 14/County State-Aid Highway 41
130.11interchange project;
130.12    (2) development of regional parks and hiking and biking trails;
130.13    (3) expansion of the North Mankato Taylor Library;
130.14    (4) riverfront redevelopment; and
130.15    (5) lake improvement projects.
130.16    The total amount of revenues from the tax in subdivision 1 that may be used to fund
130.17these projects is $6,000,000 plus any associated bond costs.
130.18    Subd. 3. Bonds. (a) The city of North Mankato, pursuant to the approval of the
130.19voters at the November 7, 2006 referendum authorizing the imposition of the taxes in
130.20this section, may issue bonds under Minnesota Statutes, chapter 475, to pay capital and
130.21administrative expenses for the projects described in subdivision 2, in an amount that
130.22does not exceed $6,000,000. A separate election to approve the bonds under Minnesota
130.23Statutes, section 475.58, is not required.
130.24    (b) The debt represented by the bonds is not included in computing any debt
130.25limitation applicable to the city, and any levy of taxes under Minnesota Statutes, section
130.26475.61, to pay principal and interest on the bonds is not subject to any levy limitation.
130.27    Subd. 4. Termination of taxes. The tax imposed under subdivision 1 expires
130.28when the city council determines that the amount of revenues received from the taxes
130.29to pay for the projects under subdivision 2 first equals or exceeds $6,000,000 plus the
130.30additional amount needed to pay the costs related to issuance of bonds under subdivision
130.313, including interest on the bonds. Any funds remaining after completion of the projects
130.32and retirement or redemption of the bonds shall be placed in a capital facilities and
130.33equipment replacement fund of the city. The tax imposed under subdivision 1 may expire
130.34at an earlier time if the city so determines by ordinance.
131.1EFFECTIVE DATE.This section is effective the day after compliance by the
131.2governing body of the city of North Mankato with Minnesota Statutes, section 645.021,
131.3subdivision 3.

131.4    Sec. 14. CITY OF WINONA; TAXES AUTHORIZED.
131.5    Subdivision 1. Sales and use tax. Notwithstanding Minnesota Statutes, section
131.6477A.016, or any other provision of law, ordinance, or city charter, if approved by the
131.7voters at a general or special election held before December 31, 2009, the city of Winona
131.8may impose by ordinance a sales and use tax of up to one-half of one percent for the
131.9purpose specified in subdivision 2. Except as otherwise provided in this section, the
131.10provisions of Minnesota Statutes, section 297A.99, govern the imposition, administration,
131.11collection, and enforcement of the tax authorized under this subdivision.
131.12    Subd. 2. Use of revenues. The proceeds of the tax imposed under this section shall
131.13be used to pay the city-borne costs for the construction of a street connection from the city
131.14of Winona to Minnesota marked State Highways 61 and 43. The construction will provide
131.15access to the city's newly built industrial park and additional access to a hospital. The total
131.16amount of revenues from the tax in subdivision 1 that may be used to fund this project is
131.17$8,000,000 plus any associated bond costs.
131.18    Subd. 3. Bonding authority. The city of Winona may issue bonds in an amount
131.19not to exceed $8,000,000 under Minnesota Statutes, chapter 475, to finance the capital
131.20expenditures under subdivision 2. An election to approve the bonds under Minnesota
131.21Statutes, section 475.58, is not required. The issuance of bonds under this subdivision is
131.22not subject to Minnesota Statutes, section 275.60 or 275.61. The debt represented by the
131.23bonds must not be included in computing any debt limitations applicable to the city, and
131.24the levy of taxes required by Minnesota Statutes, section 475.61, to pay the principal or
131.25any interest on the bonds must not be subject to any levy limitation.
131.26    Subd. 4. Termination of tax. The tax authorized under subdivision 1 terminates
131.27at the earlier of: (1) five years after the date of initial imposition of the tax; or (2) when
131.28the city council determines that sufficient funds have been raised from the tax to finance
131.29the capital and administrative costs of the project described in subdivision 2, plus the
131.30additional amount needed to pay the costs related to issuance of bonds under subdivision
131.313, including interest on the bonds. Any funds remaining after completion of the project
131.32specified in subdivision 2 and retirement or redemption of the bonds in subdivision 3 may
131.33be placed in the general fund of the city. The tax imposed under subdivision 1 may expire
131.34at an earlier time if the city so determines by ordinance.
132.1EFFECTIVE DATE.This section is effective the day after compliance by
132.2the governing body of the city of Winona with Minnesota Statutes, section 645.021,
132.3subdivisions 2 and 3.

132.4    Sec. 15. REPEALER.
132.5Laws 2005, First Special Session chapter 3, article 5, section 24, is repealed.
132.6EFFECTIVE DATE.This section is effective upon enactment of section 8.


132.9    Section 1. Minnesota Statutes 2006, section 289A.20, subdivision 4, as amended by
132.10Laws 2008, chapter 154, article 6, section 1, is amended to read:
132.11    Subd. 4. Sales and use tax. (a) The taxes imposed by chapter 297A are due and
132.12payable to the commissioner monthly on or before the 20th day of the month following the
132.13month in which the taxable event occurred, or following another reporting period as the
132.14commissioner prescribes or as allowed under section 289A.18, subdivision 4, paragraph
132.15(f) or (g), except that use taxes due on an annual use tax return as provided under section
132.16289A.11, subdivision 1 , are payable by April 15 following the close of the calendar year.
132.17    (b) A vendor having a liability of $120,000 or more during a fiscal year ending June
132.1830 must remit the June liability for the next year in the following manner:
132.19    (1) Two business days before June 30 of the year, the vendor must remit 80 85
132.20percent of the estimated June liability to the commissioner.
132.21    (2) On or before August 20 of the year, the vendor must pay any additional amount
132.22of tax not remitted in June.
132.23    (c) A vendor having a liability of:
132.24    (1) $20,000 or more in the fiscal year ending June 30, 2005; or
132.25    (2) $10,000 or more in the fiscal year ending June 30, 2006, and fiscal years
132.26thereafter,
132.27must remit all liabilities on returns due for periods beginning in the subsequent calendar
132.28year by electronic means on or before the 20th day of the month following the month in
132.29which the taxable event occurred, or on or before the 20th day of the month following the
132.30month in which the sale is reported under section 289A.18, subdivision 4, except for 80 85
132.31percent of the estimated June liability, which is due two business days before June 30. The
132.32remaining amount of the June liability is due on August 20.
132.33EFFECTIVE DATE.This section is effective beginning with June 2009 tax
132.34liabilities.

133.1    Sec. 2. Minnesota Statutes 2006, section 289A.60, subdivision 15, as amended by
133.2Laws 2008, chapter 154, article 6, section 2, is amended to read:
133.3    Subd. 15. Accelerated payment of June sales tax liability; penalty for
133.4underpayment. For payments made after December 31, 2006, if a vendor is required by
133.5law to submit an estimation of June sales tax liabilities and 80 85 percent payment by a
133.6certain date, the vendor shall pay a penalty equal to ten percent of the amount of actual
133.7June liability required to be paid in June less the amount remitted in June. The penalty
133.8must not be imposed, however, if the amount remitted in June equals the lesser of 80 85
133.9percent of the preceding May's liability or 80 85 percent of the average monthly liability
133.10for the previous calendar year.
133.11EFFECTIVE DATE.This section is effective beginning with June 2009 tax
133.12liabilities.

133.13    Sec. 3. Minnesota Statutes 2006, section 297F.09, subdivision 10, as amended by Laws
133.142008, chapter 154, article 6, section 3, is amended to read:
133.15    Subd. 10. Accelerated tax payment; cigarette or tobacco products distributor.
133.16    A cigarette or tobacco products distributor having a liability of $120,000 or more during a
133.17fiscal year ending June 30, shall remit the June liability for the next year in the following
133.18manner:
133.19    (a) Two business days before June 30 of the year, the distributor shall remit the
133.20actual May liability and 80 85 percent of the estimated June liability to the commissioner
133.21and file the return in the form and manner prescribed by the commissioner.
133.22    (b) On or before August 18 of the year, the distributor shall submit a return showing
133.23the actual June liability and pay any additional amount of tax not remitted in June. A
133.24penalty is imposed equal to ten percent of the amount of June liability required to be paid
133.25in June, less the amount remitted in June. However, the penalty is not imposed if the
133.26amount remitted in June equals the lesser of:
133.27    (1) 80 85 percent of the actual June liability; or
133.28    (2) 80 85 percent of the preceding May's liability.
133.29EFFECTIVE DATE.This section is effective beginning with June 2009 tax
133.30liabilities.

133.31    Sec. 4. Minnesota Statutes 2006, section 297G.09, subdivision 9, as amended by Laws
133.322008, chapter 154, article 6, section 4, is amended to read:
134.1    Subd. 9. Accelerated tax payment; penalty. A person liable for tax under this
134.2chapter having a liability of $120,000 or more during a fiscal year ending June 30, shall
134.3remit the June liability for the next year in the following manner:
134.4    (a) Two business days before June 30 of the year, the taxpayer shall remit the actual
134.5May liability and 80 85 percent of the estimated June liability to the commissioner and file
134.6the return in the form and manner prescribed by the commissioner.
134.7    (b) On or before August 18 of the year, the taxpayer shall submit a return showing
134.8the actual June liability and pay any additional amount of tax not remitted in June. A
134.9penalty is imposed equal to ten percent of the amount of June liability required to be paid
134.10in June less the amount remitted in June. However, the penalty is not imposed if the
134.11amount remitted in June equals the lesser of:
134.12    (1) 80 85 percent of the actual June liability; or
134.13    (2) 80 85 percent of the preceding May liability.
134.14EFFECTIVE DATE.This section is effective beginning with June 2009 tax
134.15liabilities.


134.18    Section 1. Minnesota Statutes 2006, section 163.051, subdivision 1, is amended to read:
134.19    Subdivision 1. Tax authorized. (a) Except as provided in paragraph (b), the board
134.20of commissioners of each metropolitan county is authorized to levy a wheelage tax of $5
134.21for the year 1972 and each subsequent year thereafter by resolution on each motor vehicle,
134.22except motorcycles as defined in section 169.01, subdivision 4, which that is kept in such
134.23county when not in operation and which that is subject to annual registration and taxation
134.24under chapter 168. The board may provide by resolution for collection of the wheelage
134.25tax by county officials or it may request that the tax be collected by the state registrar of
134.26motor vehicles, and the state registrar of motor vehicles shall collect such tax on behalf
134.27of the county if requested, as provided in subdivision 2.
134.28    (b) The following vehicles are exempt from the wheelage tax:
134.29    (1) motorcycles, as defined in section 169.01, subdivision 4;
134.30    (2) motorized bicycles, as defined in section 169.01, subdivision 4a;
134.31    (3) electric-assisted bicycles, as defined in section 169.01, subdivision 4b; and
134.32    (4) motorized foot scooters, as defined in section 169.01, subdivision 4c.

134.33    Sec. 2. Minnesota Statutes 2006, section 168.012, subdivision 1, is amended to read:
135.1    Subdivision 1. Vehicles exempt from tax, fees, or plate display. (a) The following
135.2vehicles are exempt from the provisions of this chapter requiring payment of tax and
135.3registration fees, except as provided in subdivision 1c:
135.4    (1) vehicles owned and used solely in the transaction of official business by the
135.5federal government, the state, or any political subdivision;
135.6    (2) vehicles owned and used exclusively by educational institutions and used solely
135.7in the transportation of pupils to and from those institutions;
135.8    (3) vehicles used solely in driver education programs at nonpublic high schools;
135.9    (4) vehicles owned by nonprofit charities and used exclusively to transport disabled
135.10persons for charitable, religious, or educational purposes;
135.11    (5) vehicles owned by nonprofit charities and used exclusively for disaster response
135.12and related activities;
135.13    (5) (6) ambulances owned by ambulance services licensed under section 144E.10,
135.14the general appearance of which is unmistakable; and
135.15    (6) (7) vehicles owned by a commercial driving school licensed under section
135.16171.34 , or an employee of a commercial driving school licensed under section 171.34, and
135.17the vehicle is used exclusively for driver education and training.
135.18    (b) Vehicles owned by the federal government, municipal fire apparatuses including
135.19fire-suppression support vehicles, police patrols, and ambulances, the general appearance
135.20of which is unmistakable, are not required to register or display number plates.
135.21    (c) Unmarked vehicles used in general police work, liquor investigations, or arson
135.22investigations, and passenger automobiles, pickup trucks, and buses owned or operated by
135.23the Department of Corrections, must be registered and must display appropriate license
135.24number plates, furnished by the registrar at cost. Original and renewal applications for
135.25these license plates authorized for use in general police work and for use by the Department
135.26of Corrections must be accompanied by a certification signed by the appropriate chief of
135.27police if issued to a police vehicle, the appropriate sheriff if issued to a sheriff's vehicle,
135.28the commissioner of corrections if issued to a Department of Corrections vehicle, or the
135.29appropriate officer in charge if issued to a vehicle of any other law enforcement agency.
135.30The certification must be on a form prescribed by the commissioner and state that the
135.31vehicle will be used exclusively for a purpose authorized by this section.
135.32    (d) Unmarked vehicles used by the Departments of Revenue and Labor and Industry,
135.33fraud unit, in conducting seizures or criminal investigations must be registered and must
135.34display passenger vehicle classification license number plates, furnished at cost by the
135.35registrar. Original and renewal applications for these passenger vehicle license plates
135.36must be accompanied by a certification signed by the commissioner of revenue or the
136.1commissioner of labor and industry. The certification must be on a form prescribed by
136.2the commissioner and state that the vehicles will be used exclusively for the purposes
136.3authorized by this section.
136.4    (e) Unmarked vehicles used by the Division of Disease Prevention and Control of the
136.5Department of Health must be registered and must display passenger vehicle classification
136.6license number plates. These plates must be furnished at cost by the registrar. Original
136.7and renewal applications for these passenger vehicle license plates must be accompanied
136.8by a certification signed by the commissioner of health. The certification must be on a
136.9form prescribed by the commissioner and state that the vehicles will be used exclusively
136.10for the official duties of the Division of Disease Prevention and Control.
136.11    (f) Unmarked vehicles used by staff of the Gambling Control Board in gambling
136.12investigations and reviews must be registered and must display passenger vehicle
136.13classification license number plates. These plates must be furnished at cost by the
136.14registrar. Original and renewal applications for these passenger vehicle license plates must
136.15be accompanied by a certification signed by the board chair. The certification must be on a
136.16form prescribed by the commissioner and state that the vehicles will be used exclusively
136.17for the official duties of the Gambling Control Board.
136.18    (g) All other motor vehicles must be registered and display tax-exempt number
136.19plates, furnished by the registrar at cost, except as provided in subdivision 1c. All
136.20vehicles required to display tax-exempt number plates must have the name of the state
136.21department or political subdivision, nonpublic high school operating a driver education
136.22program, or licensed commercial driving school, plainly displayed on both sides of the
136.23vehicle; except that each state hospital and institution for persons who are mentally ill
136.24and developmentally disabled may have one vehicle without the required identification
136.25on the sides of the vehicle, and county social service agencies may have vehicles used
136.26for child and vulnerable adult protective services without the required identification on
136.27the sides of the vehicle. This identification must be in a color giving contrast with that
136.28of the part of the vehicle on which it is placed and must endure throughout the term of
136.29the registration. The identification must not be on a removable plate or placard and must
136.30be kept clean and visible at all times; except that a removable plate or placard may be
136.31utilized on vehicles leased or loaned to a political subdivision or to a nonpublic high
136.32school driver education program.

136.33    Sec. 3. Minnesota Statutes 2006, section 168.012, is amended by adding a subdivision
136.34to read:
137.1    Subd. 2c. Spotter trucks. Spotter trucks, as defined in section 169.01, subdivision
137.27a, must not be taxed as motor vehicles using the public streets and highways, and are
137.3exempt from the provisions of this chapter.
137.4EFFECTIVE DATE.This section is effective the day following final enactment
137.5and expires June 30, 2013.

137.6    Sec. 4. Minnesota Statutes 2006, section 168.013, subdivision 1f, is amended to read:
137.7    Subd. 1f. Bus; commuter van. (a) On all intercity buses, the tax during each
137.8the first two years of vehicle life shall be based on the gross weight of the vehicle and
137.9graduated according to the following schedule:

137.10		Gross Weight of Vehicle Tax
137.11		Under 6,000 lbs. ..... $125
137.12		6,000 to 8,000 lbs., incl. ..... 125
137.13		8,001 to 10,000 lbs., incl. ..... 125
137.14		10,001 to 12,000 lbs., incl. ..... 150
137.15		12,001 to 14,000 lbs., incl. ..... 190
137.16		14,001 to 16,000 lbs., incl. ..... 210
137.17		16,001 to 18,000 lbs., incl. ..... 225
137.18		18,001 to 20,000 lbs., incl. ..... 260
137.19		20,001 to 22,000 lbs., incl. ..... 300
137.20		22,001 to 24,000 lbs., incl. ..... 350
137.21		24,001 to 26,000 lbs., incl. ..... 400
137.22		26,001 to 28,000 lbs., incl. ..... 450
137.23		28,001 to 30,000 lbs., incl. ..... 500
137.24		30,001 and over ..... 550

137.25    (b) During each of the third and fourth years of vehicle life, the tax shall be 75
137.26percent of the foregoing scheduled tax; during the fifth year of vehicle life, the tax shall be
137.2750 percent of the foregoing scheduled tax; during the sixth year of vehicle life, the tax
137.28shall be 37-1/2 percent of the foregoing scheduled tax; and during the seventh and each
137.29succeeding year of vehicle life, the tax shall be 25 percent of the foregoing scheduled tax;
137.30provided that the annual tax paid in any year of its life for an intercity bus shall be not less
137.31than $175 for a vehicle of over 25 passenger seating capacity and not less than $125 for a
137.32vehicle of 25 passenger and less seating capacity.
137.33    (c) On all intracity buses operated by an auto transportation company in the business
137.34of transporting persons for compensation as a common carrier and operating within the
137.35limits of cities having populations in excess of 200,000 inhabitants, the tax during each
137.36year of the vehicle life of each such bus shall be $40; on all of such intracity buses operated
137.37in cities having a population of less than 200,000 and more than 70,000 inhabitants, the
138.1tax during each year of vehicle life of each bus shall be $10; and on all of such intracity
138.2buses operating in cities having a population of less than 70,000 inhabitants, the tax during
138.3each year of vehicle life of each bus shall be $2.
138.4    (d) On all other buses and commuter vans, as defined in section 168.126, the tax
138.5during each of the first three years of the vehicle life shall be based on the gross weight of
138.6the vehicle and graduated according to the following schedule: Where the gross weight
138.7of the vehicle is 6,000 pounds or less, $25. Where the gross weight of the vehicle is
138.8more than 6,000 pounds, and not more than 8,000 pounds, the tax shall be $25 plus an
138.9additional tax of $5 per ton for the ton or major portion in excess of 6,000 pounds. Where
138.10the gross weight of the vehicle is more than 8,000 pounds, and not more than 20,000
138.11pounds, the tax shall be $30 plus an additional tax of $10 per ton for each ton or major
138.12portion in excess of 8,000 pounds. Where the gross weight of the vehicle is more than
138.1320,000 pounds and not more than 24,000 pounds, the tax shall be $90 plus an additional
138.14tax of $15 per ton for each ton or major portion in excess of 20,000 pounds. Where the
138.15gross weight of the vehicle is more than 24,000 pounds and not more than 28,000 pounds,
138.16the tax shall be $120 plus an additional tax of $25 per ton for each ton or major portion
138.17in excess of 24,000 pounds. Where the gross weight of the vehicle is more than 28,000
138.18pounds, the tax shall be $170 plus an additional tax of $30 per ton for each ton or major
138.19portion in excess of 28,000 pounds.
138.20    (e) During the fourth and succeeding years of vehicle life, the tax shall be 80 percent
138.21of the foregoing scheduled tax but in no event less than $20 per vehicle.

138.22    Sec. 5. Minnesota Statutes 2006, section 168A.03, subdivision 1, is amended to read:
138.23    Subdivision 1. No certificate issued. The registrar shall not issue a certificate of
138.24title for:
138.25    (1) a vehicle owned by the United States;
138.26    (2) a vehicle owned by a nonresident and not required by law to be registered in
138.27this state;
138.28    (3) a vehicle owned by a nonresident and regularly engaged in the interstate
138.29transportation of persons or property for which a currently effective certificate of title
138.30has been issued in another state;
138.31    (4) a vehicle moved solely by animal power;
138.32    (5) an implement of husbandry;
138.33    (6) special mobile equipment;
138.34    (7) a self-propelled wheelchair or invalid tricycle;
139.1    (8) a trailer (i) having a gross weight of 4,000 pounds or less unless a secured party
139.2holds an interest in the trailer or a certificate of title was previously issued by this state or
139.3any other state or (ii) designed primarily for agricultural purposes except a recreational
139.4vehicle or a manufactured home, both as defined in section 168.011, subdivisions 8 and 25;
139.5    (9) a snowmobile.; and
139.6    (10) a spotter truck, as defined in section 169.01, subdivision 7a.
139.7EFFECTIVE DATE.This section is effective the day following final enactment
139.8and expires June 30, 2013.

139.9    Sec. 6. Minnesota Statutes 2006, section 169.01, is amended by adding a subdivision
139.10to read:
139.11    Subd. 7a. Spotter truck. "Spotter truck" means a truck-tractor used exclusively for
139.12staging or shuttling trailers in the course of a truck freight operation or freight shipping
139.13operation.
139.14EFFECTIVE DATE.This section is effective the day following final enactment
139.15and expires June 30, 2013.

139.16    Sec. 7. [169.228] SPOTTER TRUCKS.
139.17    Notwithstanding any other law, a spotter truck may be operated on public streets
139.18and highways if:
139.19    (1) the operator has a valid class A, B, or C driver's license;
139.20    (2) the vehicle complies with the size, weight, and load restrictions under this
139.21chapter;
139.22    (3) the vehicle meets all inspection requirements under section 169.781; and
139.23    (4) the vehicle is operated within a zone of two air miles from the truck freight
139.24operation or freight shipping operation where the vehicle is housed.
139.25EFFECTIVE DATE.This section is effective the day following final enactment
139.26and expires June 30, 2013.

139.27    Sec. 8. Minnesota Statutes 2006, section 169.781, subdivision 1, is amended to read:
139.28    Subdivision 1. Definitions. For purposes of sections 169.781 to 169.783:
139.29    (a) "Commercial motor vehicle" means:
139.30    (1) a commercial motor vehicle as defined in section 169.01, subdivision 75,
139.31paragraph (a); and
139.32    (2) each vehicle in a combination of more than 26,000 pounds.; and
139.33    (3) a spotter truck.
140.1"Commercial motor vehicle" does not include (1) a school bus or Head Start bus
140.2displaying a certificate under section 169.451, (2) a bus operated by the Metropolitan
140.3Council or by a local transit commission created in chapter 458A, or (3) a motor vehicle
140.4that is required to be placarded under Code of Federal Regulations, title 49, parts 100-185.
140.5    (b) "Commissioner" means the commissioner of public safety.
140.6    (c) "Owner" means a person who owns, or has control, under a lease of more than 30
140.7days' duration, of one or more commercial motor vehicles.
140.8    (d) "Storage semitrailer" means a semitrailer that (1) is used exclusively to store
140.9property at a location not on a street or highway, (2) does not contain any load when
140.10moved on a street or highway, (3) is operated only during daylight hours, and (4) is marked
140.11on each side of the semitrailer "storage only" in letters at least six inches high.
140.12    (e) "Building mover vehicle" means a vehicle owned or leased by a building mover
140.13as defined in section 221.81, subdivision 1, paragraph (a), and used exclusively for
140.14moving buildings.
140.15EFFECTIVE DATE.This section is effective the day following final enactment
140.16and expires June 30, 2013.

140.17    Sec. 9. Minnesota Statutes 2006, section 383A.80, subdivision 4, is amended to read:
140.18    Subd. 4. Expiration. The authority to impose the tax under this section expires
140.19January 1, 2008 2013.
140.20EFFECTIVE DATE.This section is effective the day following final enactment
140.21and the tax may be imposed on or after that date.

140.22    Sec. 10. Minnesota Statutes 2006, section 383A.81, subdivision 1, is amended to read:
140.23    Subdivision 1. Creation. An environmental response fund is created for the
140.24purposes specified in this section. The taxes imposed by section 383A.80 must be
140.25deposited in the fund. The board of county commissioners shall administer the fund either
140.26as a county board, or a housing and redevelopment authority, or a regional rail authority.

140.27    Sec. 11. Minnesota Statutes 2006, section 383A.81, subdivision 2, is amended to read:
140.28    Subd. 2. Uses of fund. The fund created in subdivision 1 must be used for the
140.29following purposes:
140.30    (1) acquisition through purchase or condemnation of lands or property which are
140.31polluted or contaminated with hazardous substances;
141.1    (2) paying the costs associated with indemnifying or holding harmless the
141.2entity taking title to lands or property from any liability arising out of the ownership,
141.3remediation, or use of the land or property;
141.4    (3) paying for the costs of remediating the acquired land or property; or
141.5    (4) paying the costs associated with remediating lands or property which are polluted
141.6or contaminated with hazardous substances; or
141.7    (5) paying for the costs associated with improving the property for economic
141.8development, recreational, housing, transportation or rail traffic.

141.9    Sec. 12. Minnesota Statutes 2006, section 383B.80, subdivision 4, is amended to read:
141.10    Subd. 4. Expiration. The authority to impose the tax under this section expires
141.11January 1, 2008 2013.
141.12EFFECTIVE DATE.This section is effective the day following final enactment
141.13and the tax may be imposed on or after that date.

141.14    Sec. 13. [383C.798] COUNTY DEED AND MORTGAGE TAX.
141.15    Subdivision 1. Authority to impose; rate. (a) The governing body of St. Louis
141.16County may impose a mortgage registry and deed tax.
141.17    (b) The rate of the mortgage registry tax equals .0001 of the principal.
141.18    (c) The rate of the deed tax equals .0001 of the amount.
141.19    Subd. 2. General law provisions apply. The taxes under this section apply to
141.20the same base and must be imposed, collected, administered, and enforced in the same
141.21manner as provided under chapter 287 for the state mortgage registry and deed taxes.
141.22All the provisions of chapter 287 apply to these taxes, except the rate is as specified in
141.23subdivision 1, the term "St. Louis County" must be substituted for "the state," and the
141.24revenue must be deposited as provided in subdivision 3.
141.25    Subd. 3. Deposit of revenues. All revenues from the tax are for the use of the
141.26St. Louis County Board of Commissioners and must be deposited in the county's
141.27environmental response fund under section 383C.799.
141.28    Subd. 4. Initial implementation. Documents presented for recording within 60
141.29days after the date of imposition of the tax by the county that are acknowledged, sworn to
141.30before a notary, or certified before the imposition date, must not be rejected for failure to
141.31include the tax imposed under this section.
141.32    Subd. 5. Expiration. The authority to impose the tax under this section expires
141.33January 1, 2013.

142.1    Sec. 14. [383C.799] ENVIRONMENTAL RESPONSE FUND.
142.2    Subdivision 1. Creation. An environmental response fund is created for the
142.3purposes specified in this section. The taxes imposed under section 383C.798 must be
142.4deposited in the fund. The Board of County Commissioners shall administer the fund
142.5either as a county board or a housing and redevelopment authority.
142.6    Subd. 2. Uses of fund. The fund created in subdivision 1 must be used for the
142.7following purposes:
142.8    (1) acquisition through purchase or condemnation of lands or property which are
142.9polluted or contaminated with hazardous substances;
142.10    (2) paying the costs associated with indemnifying or holding harmless the
142.11entity taking title to lands or property from any liability arising out of the ownership,
142.12remediation, or use of the land or property;
142.13    (3) paying for the costs of remediating the acquired land or property; or
142.14    (4) paying the costs associated with remediating lands or property which are polluted
142.15or contaminated with hazardous substances.
142.16    Subd. 3. Matching funds. In expending funds under this section, the county shall
142.17seek matching funds from contamination cleanup funds administered by the commissioner
142.18of the Department of Employment and Economic Development, the federal government,
142.19the private sector, and any other source.
142.20    Subd. 4. Bonds. The county may pledge the proceeds from the taxes imposed by
142.21section 383C.798 to bonds issued under this section and chapters 462, 469, and 475.
142.22    Subd. 5. Land sales. Land or property acquired under this section may be resold
142.23at fair market value. Proceeds from the sale of the land must be deposited in the
142.24environmental response fund.

142.25    Sec. 15. [383D.75] COUNTY DEED AND MORTGAGE TAX.
142.26    Subdivision 1. Authority to impose; rate. (a) The governing body of Dakota
142.27County may impose a mortgage registry and deed tax.
142.28    (b) The rate of the mortgage registry tax equals .0001 of the principal.
142.29    (c) The rate of the deed tax equals .0001 of the amount.
142.30    Subd. 2. General law provisions apply. The taxes under this section apply to
142.31the same base and must be imposed, collected, administered, and enforced in the same
142.32manner as provided under chapter 287 for the state mortgage registry and deed taxes.
142.33All the provisions of chapter 287 apply to these taxes, except the rate is as specified in
143.1subdivision 1, the term "Dakota County" must be substituted for "the state," and the
143.2revenue must be deposited as provided in subdivision 3.
143.3    Subd. 3. Deposit of revenues. All revenues from the tax are for the use of
143.4the Dakota County Board of Commissioners and must be deposited in the county's
143.5environmental response fund under section 383D.76.
143.6    Subd. 4. Initial implementation. Documents presented for recording within 60
143.7days after the date of imposition of the tax by the county that are acknowledged, sworn to
143.8before a notary, or certified before the imposition date, must not be rejected for failure to
143.9include the tax imposed under this section.
143.10    Subd. 5. Expiration. The authority to impose the tax under this section expires
143.11January 1, 2013.

143.12    Sec. 16. [383D.76] ENVIRONMENTAL RESPONSE FUND.
143.13    Subdivision 1. Creation. An environmental response fund is created for the
143.14purposes specified in this section. The taxes imposed under section 383D.75 must be
143.15deposited in the fund. The Board of County Commissioners shall administer the fund
143.16either as a county board or a housing and redevelopment authority.
143.17    Subd. 2. Uses of fund. The fund created in subdivision 1 must be used for the
143.18following purposes:
143.19    (1) acquisition through purchase or condemnation of lands or property which are
143.20polluted or contaminated with hazardous substances;
143.21    (2) paying the costs associated with indemnifying or holding harmless the
143.22entity taking title to lands or property from any liability arising out of the ownership,
143.23remediation, or use of the land or property;
143.24    (3) paying for the costs of remediating the acquired land or property; or
143.25    (4) paying the costs associated with remediating lands or property which are polluted
143.26or contaminated with hazardous substances.
143.27    Subd. 3. Matching funds. In expending funds under this section, the county shall
143.28seek matching funds from contamination cleanup funds administered by the commissioner
143.29of the Department of Employment and Economic Development, the Metropolitan Council,
143.30the federal government, the private sector, and any other source.
143.31    Subd. 4. Bonds. The county may pledge the proceeds from the taxes imposed by
143.32section 383D.75 to bonds issued under this chapter and chapters 462, 469, and 475.
144.1    Subd. 5. Land sales. Land or property acquired under this section may be resold
144.2at fair market value. Proceeds from the sale of the land must be deposited in the
144.3environmental response fund.

144.4    Sec. 17. [383E.235] COUNTY DEED AND MORTGAGE TAX.
144.5    Subdivision 1. Authority to impose; rate. (a) The governing body of Anoka
144.6County may impose a mortgage registry and deed tax.
144.7    (b) The rate of the mortgage registry tax equals .0001 of the principal.
144.8    (c) The rate of the deed tax equals .0001 of the amount.
144.9    Subd. 2. General law provisions apply. The taxes under this section apply to
144.10the same base and must be imposed, collected, administered, and enforced in the same
144.11manner as provided under chapter 287 for the state mortgage registry and deed taxes.
144.12All the provisions of chapter 287 apply to these taxes, except the rate is as specified
144.13in subdivision 1, the term "Anoka County" must be substituted for "the state," and the
144.14revenue must be deposited as provided in subdivision 3.
144.15    Subd. 3. Deposit of revenues. All revenues from the tax are for the use of the Anoka
144.16County Board of Commissioners and must be deposited in the county's environmental
144.17response fund under section 383E.236.
144.18    Subd. 4. Initial implementation. Documents presented for recording within 60
144.19days after the date of imposition of the tax by the county that are acknowledged, sworn to
144.20before a notary, or certified before the imposition date, must not be rejected for failure to
144.21include the tax imposed under this section.
144.22    Subd. 5. Expiration. The authority to impose the tax under this section expires
144.23January 1, 2013.

144.24    Sec. 18. [383E.236] ENVIRONMENTAL RESPONSE FUND.
144.25    Subdivision 1. Creation. An environmental response fund is created for the
144.26purposes specified in this section. The taxes imposed under section 383E.235 must be
144.27deposited in the fund. The Board of County Commissioners shall administer the fund
144.28either as a county board or a housing and redevelopment authority.
144.29    Subd. 2. Uses of fund. The fund created in subdivision 1 must be used for the
144.30following purposes:
144.31    (1) acquisition through purchase or condemnation of lands or property which are
144.32polluted or contaminated with hazardous substances;
145.1    (2) paying the costs associated with indemnifying or holding harmless the
145.2entity taking title to lands or property from any liability arising out of the ownership,
145.3remediation, or use of the land or property;
145.4    (3) paying for the costs of remediating the acquired land or property; or
145.5    (4) paying the costs associated with remediating lands or property which are polluted
145.6or contaminated with hazardous substances.
145.7    Subd. 3. Matching funds. In expending funds under this section, the county shall
145.8seek matching funds from contamination cleanup funds administered by the commissioner
145.9of the Department of Employment and Economic Development, the Metropolitan Council,
145.10the federal government, the private sector, and any other source.
145.11    Subd. 4. Bonds. The county may pledge the proceeds from the taxes imposed by
145.12section 383E.235 to bonds issued under this section and chapters 462, 469, and 475.
145.13    Subd. 5. Land sales. Land or property acquired under this section may be resold
145.14at fair market value. Proceeds from the sale of the land must be deposited in the
145.15environmental response fund.
145.16    Subd. 6. DOT assistance. The commissioner of transportation shall collaborate with
145.17the county and any affected municipality by providing technical assistance and support in
145.18cleaning up a contaminated site related to a trunk highway or railroad improvement.


145.21    Section 1. Minnesota Statutes 2006, section 272.02, subdivision 13, is amended to read:
145.22    Subd. 13. Emergency shelters for victims of domestic abuse. Property used in
145.23a continuous program to provide emergency shelter for victims of domestic abuse is
145.24exempt, provided the organization that owns and sponsors the shelter is exempt from
145.25federal income taxation pursuant to section 501(c)(3) of the Internal Revenue Code
145.26of 1986, as amended through December 31, 1992, notwithstanding the fact that the
145.27sponsoring organization receives funding under Section 8 of the United States Housing
145.28Act of 1937, as amended.
145.29EFFECTIVE DATE.This section is effective the day following final enactment.

145.30    Sec. 2. Minnesota Statutes 2006, section 272.02, subdivision 20, is amended to read:
145.31    Subd. 20. Transitional housing facilities. Transitional housing facilities are
145.32exempt. "Transitional housing facility" means a facility that meets the following
145.33requirements. (i) It provides temporary housing to individuals, couples, or families. (ii)
146.1It has the purpose of reuniting families and enabling parents or individuals to obtain
146.2self-sufficiency, advance their education, get job training, or become employed in jobs
146.3that provide a living wage. (iii) It provides support services such as child care, work
146.4readiness training, and career development counseling; and a self-sufficiency program
146.5with periodic monitoring of each resident's progress in completing the program's goals.
146.6(iv) It provides services to a resident of the facility for at least three months but no longer
146.7than three years, except residents enrolled in an educational or vocational institution or job
146.8training program. These residents may receive services during the time they are enrolled
146.9but in no event longer than four years. (v) It is owned and operated or under lease from a
146.10unit of government or governmental agency under a property disposition program and
146.11operated by one or more organizations exempt from federal income tax under section
146.12501(c)(3) of the Internal Revenue Code of 1986, as amended through December 31,
146.131992. This exemption applies notwithstanding the fact that the sponsoring organization
146.14receives financing by a direct federal loan or federally insured loan or a loan made by the
146.15Minnesota Housing Finance Agency under the provisions of either Title II of the National
146.16Housing Act, as amended, or the Minnesota Housing Finance Agency Law of 1971,
146.17chapter 462A, or rules promulgated by the agency pursuant to it, and notwithstanding the
146.18fact that the sponsoring organization receives funding under Section 8 of the United
146.19States Housing Act of 1937, as amended.
146.20EFFECTIVE DATE.This section is effective the day following final enactment.

146.21    Sec. 3. Minnesota Statutes 2006, section 272.02, subdivision 21, is amended to read:
146.22    Subd. 21. Property used to provide computing resources to University of
146.23Minnesota. Real and personal property, including leasehold or other personal property
146.24interests, is exempt if it is owned and operated by a corporation of which more than 50
146.25percent of the total voting power of the stock of the corporation is owned collectively by:
146.26(i) the Board of Regents of the University of Minnesota, (ii) the University of Minnesota
146.27Foundation, an organization exempt from federal income taxation under section 501(c)(3)
146.28of the Internal Revenue Code of 1986, as amended through December 31, 1992, and (iii)
146.29a corporation organized under chapter 317A, which by its articles of incorporation is
146.30prohibited from providing pecuniary gain to any person or entity other than the regents
146.31of the University of Minnesota; which property is used primarily to manage or provide
146.32goods, services, or facilities utilizing or relating to large-scale advanced scientific
146.33computing resources to the regents of the University of Minnesota and others.
146.34EFFECTIVE DATE.This section is effective the day following final enactment.

147.1    Sec. 4. Minnesota Statutes 2006, section 272.02, subdivision 27, is amended to read:
147.2    Subd. 27. Superior National Forest; recreational property for use by disabled
147.3veterans. Real and personal property is exempt if it is located in the Superior National
147.4Forest, and owned or leased and operated by a nonprofit organization that is exempt
147.5from federal income taxation under section 501(c)(3) of the Internal Revenue Code of
147.61986, as amended through December 31, 1992, and primarily used to provide recreational
147.7opportunities for disabled veterans and their families.
147.8EFFECTIVE DATE.This section is effective the day following final enactment.

147.9    Sec. 5. Minnesota Statutes 2006, section 272.02, subdivision 31, is amended to read:
147.10    Subd. 31. Business incubator property. Property owned by a nonprofit charitable
147.11organization that qualifies for tax exemption under section 501(c)(3) of the Internal
147.12Revenue Code of 1986, as amended through December 31, 1997, that is intended to be
147.13used as a business incubator in a high-unemployment county, is exempt. As used in this
147.14subdivision, a "business incubator" is a facility used for the development of nonretail
147.15businesses, offering access to equipment, space, services, and advice to the tenant
147.16businesses, for the purpose of encouraging economic development, diversification, and
147.17job creation in the area served by the organization, and "high-unemployment county" is a
147.18county that had an average annual unemployment rate of 7.9 percent or greater in 1997.
147.19Property that qualifies for the exemption under this subdivision is limited to no more than
147.20two contiguous parcels and structures that do not exceed in the aggregate 40,000 square
147.21feet. This exemption expires after taxes payable in 2011.
147.22EFFECTIVE DATE.This section is effective the day following final enactment.

147.23    Sec. 6. Minnesota Statutes 2006, section 272.02, subdivision 49, is amended to read:
147.24    Subd. 49. Agricultural historical society property. Property is exempt from
147.25taxation if it is owned by a nonprofit charitable or educational organization that qualifies
147.26for exemption under section 501(c)(3) of the Internal Revenue Code of 1986, as amended
147.27through December 31, 2000, and meets the following criteria:
147.28    (1) the property is primarily used for storing and exhibiting tools, equipment, and
147.29artifacts useful in providing an understanding of local or regional agricultural history.
147.30Primary use is determined each year based on the number of days the property is used
147.31solely for storage and exhibition purposes;
147.32    (2) the property is limited to a maximum of 20 acres per owner per county, but
147.33includes the land and any taxable structures, fixtures, and equipment on the land;
148.1    (3) the property is not used for a revenue-producing activity for more than ten days
148.2in each calendar year; and
148.3    (4) the property is not used for residential purposes on either a temporary or
148.4permanent basis.
148.5EFFECTIVE DATE.This section is effective the day following final enactment.

148.6    Sec. 7. Minnesota Statutes 2006, section 272.03, subdivision 3, is amended to read:
148.7    Subd. 3. Construction of terms. For the purposes of chapters 270 to 284, unless a
148.8different meaning is indicated by the context, the words, phrases, and terms defined in
148.9subdivisions 4 to 11 shall this section have the meanings given them.
148.10EFFECTIVE DATE.This section is effective the day following final enactment.

148.11    Sec. 8. Minnesota Statutes 2006, section 272.03, is amended by adding a subdivision
148.12to read:
148.13    Subd. 13. Internal Revenue Code. Unless specifically defined otherwise, "Internal
148.14Revenue Code" means the Internal Revenue Code as defined in section 289A.02,
148.15subdivision 7.
148.16EFFECTIVE DATE.This section is effective the day following final enactment.

148.17    Sec. 9. [273.105] INTERNAL REVENUE CODE.
148.18    Unless specifically defined otherwise, for purposes of this chapter, "Internal Revenue
148.19Code" means the Internal Revenue Code as defined in section 289A.02, subdivision 7.
148.20EFFECTIVE DATE.This section is effective the day following final enactment.

148.21    Sec. 10. Minnesota Statutes 2006, section 273.11, subdivision 8, is amended to read:
148.22    Subd. 8. Limited equity cooperative apartments. For the purposes of this
148.23subdivision, the terms defined in this subdivision have the meanings given them.
148.24    A "limited equity cooperative" is a corporation organized under chapter 308A or
148.25308B, which has as its primary purpose the provision of housing and related services to
148.26its members which meets one of the following criteria with respect to the income of its
148.27members: (1) a minimum of 75 percent of members must have incomes at or less than
148.2890 percent of area median income, (2) a minimum of 40 percent of members must have
148.29incomes at or less than 60 percent of area median income, or (3) a minimum of 20 percent
148.30of members must have incomes at or less than 50 percent of area median income. For
148.31purposes of this clause, "member income" shall mean the income of a member existing at
148.32the time the member acquires cooperative membership, and median income shall mean
149.1the St. Paul-Minneapolis metropolitan area median income as determined by the United
149.2States Department of Housing and Urban Development. It must also meet the following
149.3requirements:
149.4    (a) The articles of incorporation set the sale price of occupancy entitling cooperative
149.5shares or memberships at no more than a transfer value determined as provided in the
149.6articles. That value may not exceed the sum of the following:
149.7    (1) the consideration paid for the membership or shares by the first occupant of the
149.8unit, as shown in the records of the corporation;
149.9    (2) the fair market value, as shown in the records of the corporation, of any
149.10improvements to the real property that were installed at the sole expense of the member
149.11with the prior approval of the board of directors;
149.12    (3) accumulated interest, or an inflation allowance not to exceed the greater of a ten
149.13percent annual noncompounded increase on the consideration paid for the membership or
149.14share by the first occupant of the unit, or the amount that would have been paid on that
149.15consideration if interest had been paid on it at the rate of the percentage increase in the
149.16revised Consumer Price Index for All Urban Consumers for the Minneapolis-St. Paul
149.17metropolitan area prepared by the United States Department of Labor, provided that the
149.18amount determined pursuant to this clause may not exceed $500 for each year or fraction
149.19of a year the membership or share was owned; plus
149.20    (4) real property capital contributions shown in the records of the corporation to
149.21have been paid by the transferor member and previous holders of the same membership,
149.22or of separate memberships that had entitled occupancy to the unit of the member
149.23involved. These contributions include contributions to a corporate reserve account the
149.24use of which is restricted to real property improvements or acquisitions, contributions to
149.25the corporation which are used for real property improvements or acquisitions, and the
149.26amount of principal amortized by the corporation on its indebtedness due to the financing
149.27of real property acquisition or improvement or the averaging of principal paid by the
149.28corporation over the term of its real property-related indebtedness.
149.29    (b) The articles of incorporation require that the board of directors limit the purchase
149.30price of stock or membership interests for new member-occupants or resident shareholders
149.31to an amount which does not exceed the transfer value for the membership or stock as
149.32defined in clause (a).
149.33    (c) The articles of incorporation require that the total distribution out of capital to a
149.34member shall not exceed that transfer value.
149.35    (d) The articles of incorporation require that upon liquidation of the corporation any
149.36assets remaining after retirement of corporate debts and distribution to members will
150.1be conveyed to a charitable organization described in section 501(c)(3) of the Internal
150.2Revenue Code of 1986, as amended through December 31, 1992, or a public agency.
150.3    A "limited equity cooperative apartment" is a dwelling unit owned by a limited
150.4equity cooperative.
150.5    "Occupancy entitling cooperative share or membership" is the ownership interest
150.6in a cooperative organization which entitles the holder to an exclusive right to occupy a
150.7dwelling unit owned or leased by the cooperative.
150.8    For purposes of taxation, the assessor shall value a unit owned by a limited equity
150.9cooperative at the lesser of its market value or the value determined by capitalizing the net
150.10operating income of a comparable apartment operated on a rental basis at the capitalization
150.11rate used in valuing comparable buildings that are not limited equity cooperatives. If a
150.12cooperative fails to operate in accordance with the provisions of clauses (a) to (d), the
150.13property shall be subject to additional property taxes in the amount of the difference
150.14between the taxes determined in accordance with this subdivision for the last ten years that
150.15the property had been assessed pursuant to this subdivision and the amount that would
150.16have been paid if the provisions of this subdivision had not applied to it. The additional
150.17taxes, plus interest at the rate specified in section 549.09, shall be extended against the
150.18property on the tax list for the current year.
150.19EFFECTIVE DATE.This section is effective the day following final enactment.

150.20    Sec. 11. Minnesota Statutes 2006, section 273.124, subdivision 6, is amended to read:
150.21    Subd. 6. Leasehold cooperatives. When one or more dwellings or one or more
150.22buildings which each contain several dwelling units is owned by a nonprofit corporation
150.23subject to the provisions of chapter 317A and qualifying under section 501(c)(3) or
150.24501(c)(4) of the Internal Revenue Code of 1986, as amended through December 31,
150.251990, or a limited partnership which corporation or partnership operates the property in
150.26conjunction with a cooperative association, and has received public financing, homestead
150.27treatment may be claimed by the cooperative association on behalf of the members of
150.28the cooperative for each dwelling unit occupied by a member of the cooperative. The
150.29cooperative association must provide the assessor with the Social Security numbers of
150.30those members. To qualify for the treatment provided by this subdivision, the following
150.31conditions must be met:
150.32    (a) the cooperative association must be organized under chapter 308A or 308B and
150.33all voting members of the board of directors must be resident tenants of the cooperative
150.34and must be elected by the resident tenants of the cooperative;
151.1    (b) the cooperative association must have a lease for occupancy of the property for a
151.2term of at least 20 years, which permits the cooperative association, while not in default on
151.3the lease, to participate materially in the management of the property, including material
151.4participation in establishing budgets, setting rent levels, and hiring and supervising a
151.5management agent;
151.6    (c) to the extent permitted under state or federal law, the cooperative association
151.7must have a right under a written agreement with the owner to purchase the property if the
151.8owner proposes to sell it; if the cooperative association does not purchase the property it is
151.9offered for sale, the owner may not subsequently sell the property to another purchaser at
151.10a price lower than the price at which it was offered for sale to the cooperative association
151.11unless the cooperative association approves the sale;
151.12    (d) a minimum of 40 percent of the cooperative association's members must have
151.13incomes at or less than 60 percent of area median gross income as determined by the
151.14United States Secretary of Housing and Urban Development under section 142(d)(2)(B)
151.15of the Internal Revenue Code of 1986, as amended through December 31, 1991. For
151.16purposes of this clause, "member income" means the income of a member existing at the
151.17time the member acquires cooperative membership;
151.18    (e) if a limited partnership owns the property, it must include as the managing
151.19general partner a nonprofit organization operating under the provisions of chapter 317A
151.20and qualifying under section 501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986,
151.21as amended through December 31, 1990, and the limited partnership agreement must
151.22provide that the managing general partner have sufficient powers so that it materially
151.23participates in the management and control of the limited partnership;
151.24    (f) prior to becoming a member of a leasehold cooperative described in this
151.25subdivision, a person must have received notice that (1) describes leasehold cooperative
151.26property in plain language, including but not limited to the effects of classification
151.27under this subdivision on rents, property taxes and tax credits or refunds, and operating
151.28expenses, and (2) states that copies of the articles of incorporation and bylaws of the
151.29cooperative association, the lease between the owner and the cooperative association, a
151.30sample sublease between the cooperative association and a tenant, and, if the owner is a
151.31partnership, a copy of the limited partnership agreement, can be obtained upon written
151.32request at no charge from the owner, and the owner must send or deliver the materials
151.33within seven days after receiving any request;
151.34    (g) if a dwelling unit of a building was occupied on the 60th day prior to the date on
151.35which the unit became leasehold cooperative property described in this subdivision, the
151.36notice described in paragraph (f) must have been sent by first class mail to the occupant of
152.1the unit at least 60 days prior to the date on which the unit became leasehold cooperative
152.2property. For purposes of the notice under this paragraph, the copies of the documents
152.3referred to in paragraph (f) may be in proposed version, provided that any subsequent
152.4material alteration of those documents made after the occupant has requested a copy
152.5shall be disclosed to any occupant who has requested a copy of the document. Copies of
152.6the articles of incorporation and certificate of limited partnership shall be filed with the
152.7secretary of state after the expiration of the 60-day period unless the change to leasehold
152.8cooperative status does not proceed;
152.9    (h) the county attorney of the county in which the property is located must certify to
152.10the assessor that the property meets the requirements of this subdivision;
152.11    (i) the public financing received must be from at least one of the following sources:
152.12    (1) tax increment financing proceeds used for the acquisition or rehabilitation of the
152.13building or interest rate write-downs relating to the acquisition of the building;
152.14    (2) government issued bonds exempt from taxes under section 103 of the Internal
152.15Revenue Code of 1986, as amended through December 31, 1991, the proceeds of which
152.16are used for the acquisition or rehabilitation of the building;
152.17    (3) programs under section 221(d)(3), 202, or 236, of Title II of the National
152.18Housing Act;
152.19    (4) rental housing program funds under Section 8 of the United States Housing Act
152.20of 1937, as amended, or the market rate family graduated payment mortgage program
152.21funds administered by the Minnesota Housing Finance Agency that are used for the
152.22acquisition or rehabilitation of the building;
152.23    (5) low-income housing credit under section 42 of the Internal Revenue Code of
152.241986, as amended through December 31, 1991;
152.25    (6) public financing provided by a local government used for the acquisition or
152.26rehabilitation of the building, including grants or loans from (i) federal community
152.27development block grants; (ii) HOME block grants; or (iii) residential rental bonds issued
152.28under chapter 474A; or
152.29    (7) other rental housing program funds provided by the Minnesota Housing Finance
152.30Agency for the acquisition or rehabilitation of the building;
152.31    (j) at the time of the initial request for homestead classification or of any transfer of
152.32ownership of the property, the governing body of the municipality in which the property is
152.33located must hold a public hearing and make the following findings:
152.34    (1) that the granting of the homestead treatment of the apartment's units will
152.35facilitate safe, clean, affordable housing for the cooperative members that would otherwise
152.36not be available absent the homestead designation;
153.1    (2) that the owner has presented information satisfactory to the governing body
153.2showing that the savings garnered from the homestead designation of the units will be
153.3used to reduce tenant's rents or provide a level of furnishing or maintenance not possible
153.4absent the designation; and
153.5    (3) that the requirements of paragraphs (b), (d), and (i) have been met.
153.6    Homestead treatment must be afforded to units occupied by members of the
153.7cooperative association and the units must be assessed as provided in subdivision 3,
153.8provided that any unit not so occupied shall be classified and assessed pursuant to the
153.9appropriate class. No more than three acres of land may, for assessment purposes,
153.10be included with each dwelling unit that qualifies for homestead treatment under this
153.11subdivision.
153.12    When dwelling units no longer qualify under this subdivision, the current owner
153.13must notify the assessor within 60 days. Failure to notify the assessor within 60 days shall
153.14result in the loss of benefits under this subdivision for taxes payable in the year that the
153.15failure is discovered. For these purposes, "benefits under this subdivision" means the
153.16difference in the net tax capacity of the units which no longer qualify as computed under
153.17this subdivision and as computed under the otherwise applicable law, times the local tax
153.18rate applicable to the building for that taxes payable year. Upon discovery of a failure to
153.19notify, the assessor shall inform the auditor of the difference in net tax capacity for the
153.20building or buildings in which units no longer qualify, and the auditor shall calculate the
153.21benefits under this subdivision. Such amount, plus a penalty equal to 100 percent of that
153.22amount, shall then be demanded of the building's owner. The property owner may appeal
153.23the county's determination by serving copies of a petition for review with county officials
153.24as provided in section 278.01 and filing a proof of service as provided in section 278.01
153.25with the Minnesota Tax Court within 60 days of the date of the notice from the county.
153.26The appeal shall be governed by the Tax Court procedures provided in chapter 271, for
153.27cases relating to the tax laws as defined in section 271.01, subdivision 5; disregarding
153.28sections 273.125, subdivision 5, and 278.03, but including section 278.05, subdivision 2.
153.29If the amount of the benefits under this subdivision and penalty are not paid within 60
153.30days, and if no appeal has been filed, the county auditor shall certify the amount of the
153.31benefit and penalty to the succeeding year's tax list to be collected as part of the property
153.32taxes on the affected buildings.
153.33EFFECTIVE DATE.This section is effective the day following final enactment.

153.34    Sec. 12. Minnesota Statutes 2006, section 273.128, subdivision 1, as amended by Laws
153.352008, chapter 154, article 2, section 10, is amended to read:
154.1    Subdivision 1. Requirement. Low-income rental property classified as class 4d
154.2under section 273.13, subdivision 25, is entitled to valuation under this section if at least 20
154.3percent of the units in the rental housing property meet any of the following qualifications:
154.4    (1) the units are subject to a housing assistance payments contract under Section 8
154.5of the United States Housing Act of 1937, as amended;
154.6    (2) the units are rent-restricted and income-restricted units of a qualified low-income
154.7housing project receiving tax credits under section 42(g) of the Internal Revenue Code
154.8of 1986, as amended;
154.9    (3) the units are financed by the Rural Housing Service of the United States
154.10Department of Agriculture and receive payments under the rental assistance program
154.11pursuant to section 521(a) of the Housing Act of 1949, as amended; or
154.12    (4) the units are subject to rent and income restrictions under the terms of financial
154.13assistance provided to the rental housing property by the federal government or the
154.14state of Minnesota, or a local unit of government, as evidenced by a document recorded
154.15against the property.
154.16    The restrictions must require assisted units to be occupied by residents whose
154.17household income at the time of initial occupancy does not exceed 60 percent of the
154.18greater of area or state median income, adjusted for family size, as determined by the
154.19United States Department of Housing and Urban Development. The restriction must also
154.20require the rents for assisted units to not exceed 30 percent of 60 percent of the greater of
154.21area or state median income, adjusted for family size, as determined by the United States
154.22Department of Housing and Urban Development.
154.23EFFECTIVE DATE.This section is effective the day following final enactment.

154.24    Sec. 13. Minnesota Statutes 2006, section 273.13, subdivision 25, as amended by Laws
154.252008, chapter 154, article 2, section 13, is amended to read:
154.26    Subd. 25. Class 4. (a) Class 4a is residential real estate containing four or more
154.27units and used or held for use by the owner or by the tenants or lessees of the owner
154.28as a residence for rental periods of 30 days or more, excluding property qualifying for
154.29class 4d. Class 4a also includes hospitals licensed under sections 144.50 to 144.56, other
154.30than hospitals exempt under section 272.02, and contiguous property used for hospital
154.31purposes, without regard to whether the property has been platted or subdivided. The
154.32market value of class 4a property has a class rate of 1.25 percent.
154.33    (b) Class 4b includes:
154.34    (1) residential real estate containing less than four units that does not qualify as class
154.354bb, other than seasonal residential recreational property;
155.1    (2) manufactured homes not classified under any other provision;
155.2    (3) a dwelling, garage, and surrounding one acre of property on a nonhomestead
155.3farm classified under subdivision 23, paragraph (b) containing two or three units; and
155.4    (4) unimproved property that is classified residential as determined under subdivision
155.533.
155.6    The market value of class 4b property has a class rate of 1.25 percent.
155.7    (c) Class 4bb includes:
155.8    (1) nonhomestead residential real estate containing one unit, other than seasonal
155.9residential recreational property; and
155.10    (2) a single family dwelling, garage, and surrounding one acre of property on a
155.11nonhomestead farm classified under subdivision 23, paragraph (b).
155.12    Class 4bb property has the same class rates as class 1a property under subdivision 22.
155.13    Property that has been classified as seasonal residential recreational property at
155.14any time during which it has been owned by the current owner or spouse of the current
155.15owner does not qualify for class 4bb.
155.16    (d) Class 4c property includes:
155.17    (1) except as provided in subdivision 22, paragraph (c), or subdivision 23, paragraph
155.18(b), clause (1), real and personal property devoted to temporary and seasonal residential
155.19occupancy for recreation purposes, including real and personal property devoted to
155.20temporary and seasonal residential occupancy for recreation purposes and not devoted to
155.21commercial purposes for more than 250 days in the year preceding the year of assessment.
155.22For purposes of this clause, property is devoted to a commercial purpose on a specific
155.23day if any portion of the property is used for residential occupancy, and a fee is charged
155.24for residential occupancy. Class 4c property must contain three or more rental units. A
155.25"rental unit" is defined as a cabin, condominium, townhouse, sleeping room, or individual
155.26camping site equipped with water and electrical hookups for recreational vehicles. Class
155.274c property must provide recreational activities such as renting ice fishing houses, boats
155.28and motors, snowmobiles, downhill or cross-country ski equipment; provide marina
155.29services, launch services, or guide services; or sell bait and fishing tackle. A camping
155.30pad offered for rent by a property that otherwise qualifies for class 4c is also class 4c
155.31regardless of the term of the rental agreement, as long as the use of the camping pad
155.32does not exceed 250 days. In order for a property to be classified as class 4c, seasonal
155.33residential recreational for commercial purposes, at least 40 percent of the annual gross
155.34lodging receipts related to the property must be from business conducted during 90
155.35consecutive days and either (i) at least 60 percent of all paid bookings by lodging guests
155.36during the year must be for periods of at least two consecutive nights; or (ii) at least 20
156.1percent of the annual gross receipts must be from charges for rental of fish houses, boats
156.2and motors, snowmobiles, downhill or cross-country ski equipment, or charges for marina
156.3services, launch services, and guide services, or the sale of bait and fishing tackle. For
156.4purposes of this determination, a paid booking of five or more nights shall be counted as
156.5two bookings. Class 4c also includes commercial use real property used exclusively
156.6for recreational purposes in conjunction with class 4c property devoted to temporary
156.7and seasonal residential occupancy for recreational purposes, up to a total of two acres,
156.8provided the property is not devoted to commercial recreational use for more than 250
156.9days in the year preceding the year of assessment and is located within two miles of the
156.10class 4c property with which it is used. Owners of real and personal property devoted
156.11to temporary and seasonal residential occupancy for recreation purposes and all or a
156.12portion of which was devoted to commercial purposes for not more than 250 days in the
156.13year preceding the year of assessment desiring classification as class 4c, must submit a
156.14declaration to the assessor designating the cabins or units occupied for 250 days or less in
156.15the year preceding the year of assessment by January 15 of the assessment year. Those
156.16cabins or units and a proportionate share of the land on which they are located must be
156.17designated class 4c as otherwise provided. The remainder of the cabins or units and
156.18a proportionate share of the land on which they are located will be designated as class
156.193a. The owner of property desiring designation as class 4c property must provide guest
156.20registers or other records demonstrating that the units for which class 4c designation is
156.21sought were not occupied for more than 250 days in the year preceding the assessment if
156.22so requested. The portion of a property operated as a (1) restaurant, (2) bar, (3) gift shop,
156.23(4) conference center or meeting room, and (5) other nonresidential facility operated on a
156.24commercial basis not directly related to temporary and seasonal residential occupancy for
156.25recreation purposes does not qualify for class 4c;
156.26    (2) qualified property used as a golf course if:
156.27    (i) it is open to the public on a daily fee basis. It may charge membership fees or
156.28dues, but a membership fee may not be required in order to use the property for golfing,
156.29and its green fees for golfing must be comparable to green fees typically charged by
156.30municipal courses; and
156.31    (ii) it meets the requirements of section 273.112, subdivision 3, paragraph (d).
156.32    A structure used as a clubhouse, restaurant, or place of refreshment in conjunction
156.33with the golf course is classified as class 3a property;
156.34    (3) real property up to a maximum of three acres of land owned and used by a
156.35nonprofit community service oriented organization and that is not used for residential
157.1purposes on either a temporary or permanent basis, qualifies for class 4c provided that
157.2it meets either of the following:
157.3    (i) the property is not used for a revenue-producing activity for more than six days
157.4in the calendar year preceding the year of assessment; or
157.5    (ii) the organization makes annual charitable contributions and donations at least
157.6equal to the property's previous year's property taxes and the property is allowed to be
157.7used for public and community meetings or events for no charge, as appropriate to the
157.8size of the facility.
157.9    For purposes of this clause,
157.10    (A) "charitable contributions and donations" has the same meaning as lawful
157.11gambling purposes under section 349.12, subdivision 25, excluding those purposes
157.12relating to the payment of taxes, assessments, fees, auditing costs, and utility payments;
157.13    (B) "property taxes" excludes the state general tax;
157.14    (C) a "nonprofit community service oriented organization" means any corporation,
157.15society, association, foundation, or institution organized and operated exclusively for
157.16charitable, religious, fraternal, civic, or educational purposes, and which is exempt from
157.17federal income taxation pursuant to section 501(c)(3), (10), or (19) of the Internal Revenue
157.18Code of 1986, as amended through December 31, 1990; and
157.19    (D) "revenue-producing activities" shall include but not be limited to property or that
157.20portion of the property that is used as an on-sale intoxicating liquor or 3.2 percent malt
157.21liquor establishment licensed under chapter 340A, a restaurant open to the public, bowling
157.22alley, a retail store, gambling conducted by organizations licensed under chapter 349, an
157.23insurance business, or office or other space leased or rented to a lessee who conducts a
157.24for-profit enterprise on the premises.
157.25Any portion of the property qualifying under item (i) which is used for revenue-producing
157.26activities for more than six days in the calendar year preceding the year of assessment
157.27shall be assessed as class 3a. The use of the property for social events open exclusively
157.28to members and their guests for periods of less than 24 hours, when an admission is
157.29not charged nor any revenues are received by the organization shall not be considered a
157.30revenue-producing activity.
157.31    The organization shall maintain records of its charitable contributions and donations
157.32and of public meetings and events held on the property and make them available upon
157.33request any time to the assessor to ensure eligibility. An organization meeting the
157.34requirement under item (ii) must file an application by May 1 with the assessor for
157.35eligibility for the current year's assessment. The commissioner shall prescribe a uniform
157.36application form and instructions;
158.1    (4) postsecondary student housing of not more than one acre of land that is owned by
158.2a nonprofit corporation organized under chapter 317A and is used exclusively by a student
158.3cooperative, sorority, or fraternity for on-campus housing or housing located within two
158.4miles of the border of a college campus;
158.5    (5) manufactured home parks as defined in section 327.14, subdivision 3;
158.6    (6) real property that is actively and exclusively devoted to indoor fitness, health,
158.7social, recreational, and related uses, is owned and operated by a not-for-profit corporation,
158.8and is located within the metropolitan area as defined in section 473.121, subdivision 2;
158.9    (7) a leased or privately owned noncommercial aircraft storage hangar not exempt
158.10under section 272.01, subdivision 2, and the land on which it is located, provided that:
158.11    (i) the land is on an airport owned or operated by a city, town, county, Metropolitan
158.12Airports Commission, or group thereof; and
158.13    (ii) the land lease, or any ordinance or signed agreement restricting the use of the
158.14leased premise, prohibits commercial activity performed at the hangar.
158.15    If a hangar classified under this clause is sold after June 30, 2000, a bill of sale must
158.16be filed by the new owner with the assessor of the county where the property is located
158.17within 60 days of the sale;
158.18    (8) a privately owned noncommercial aircraft storage hangar not exempt under
158.19section 272.01, subdivision 2, and the land on which it is located, provided that:
158.20    (i) the land abuts a public airport; and
158.21    (ii) the owner of the aircraft storage hangar provides the assessor with a signed
158.22agreement restricting the use of the premises, prohibiting commercial use or activity
158.23performed at the hangar; and
158.24    (9) residential real estate, a portion of which is used by the owner for homestead
158.25purposes, and that is also a place of lodging, if all of the following criteria are met:
158.26    (i) rooms are provided for rent to transient guests that generally stay for periods
158.27of 14 or fewer days;
158.28    (ii) meals are provided to persons who rent rooms, the cost of which is incorporated
158.29in the basic room rate;
158.30    (iii) meals are not provided to the general public except for special events on fewer
158.31than seven days in the calendar year preceding the year of the assessment; and
158.32    (iv) the owner is the operator of the property.
158.33The market value subject to the 4c classification under this clause is limited to five rental
158.34units. Any rental units on the property in excess of five, must be valued and assessed as
158.35class 3a. The portion of the property used for purposes of a homestead by the owner must
158.36be classified as class 1a property under subdivision 22.
159.1    Class 4c property has a class rate of 1.5 percent of market value, except that (i) each
159.2parcel of seasonal residential recreational property not used for commercial purposes has
159.3the same class rates as class 4bb property, (ii) manufactured home parks assessed under
159.4clause (5) have the same class rate as class 4b property, (iii) commercial-use seasonal
159.5residential recreational property has a class rate of one percent for the first $500,000 of
159.6market value, and 1.25 percent for the remaining market value, (iv) the market value of
159.7property described in clause (4) has a class rate of one percent, (v) the market value of
159.8property described in clauses (2) and (6) has a class rate of 1.25 percent, and (vi) that
159.9portion of the market value of property in clause (9) qualifying for class 4c property
159.10has a class rate of 1.25 percent.
159.11    (e) Class 4d property is qualifying low-income rental housing certified to the assessor
159.12by the Housing Finance Agency under section 273.128, subdivision 3. If only a portion
159.13of the units in the building qualify as low-income rental housing units as certified under
159.14section 273.128, subdivision 3, only the proportion of qualifying units to the total number
159.15of units in the building qualify for class 4d. The remaining portion of the building shall be
159.16classified by the assessor based upon its use. Class 4d also includes the same proportion of
159.17land as the qualifying low-income rental housing units are to the total units in the building.
159.18For all properties qualifying as class 4d, the market value determined by the assessor must
159.19be based on the normal approach to value using normal unrestricted rents.
159.20    Class 4d property has a class rate of 0.75 percent.
159.21EFFECTIVE DATE.This section is effective the day following final enactment.

159.22    Sec. 14. Minnesota Statutes 2006, section 287.20, subdivision 3a, is amended to read:
159.23    Subd. 3a. Designated transfer. "Designated transfer" means any of the following:
159.24    (1) a transfer between (i) an entity owned by a sole owner, and (ii) that sole owner;
159.25    (2) a transfer between (i) an entity in which a husband, a wife, or both are the sole
159.26owners, and (ii) the husband, wife, or both;
159.27    (3) a transfer between (i) an entity with multiple co-owners, and (ii) all of the
159.28co-owners, so long as each of the co-owners maintains the same percentage ownership
159.29interest in the transferred real property, whether directly or through ownership of a
159.30percentage of the entity;
159.31    (4) a transfer between (i) a revocable trust, and (ii) the grantor or grantors of the
159.32revocable trust; or
159.33    (5) a transfer of substantially all of the assets of one or more entities pursuant to a
159.34reorganization, as defined in section 287.20, subdivision 9.
160.1For purposes of this definition of designated transfer, an interest in an entity that is
160.2owned, directly or indirectly, by or for another entity shall be considered as being owned
160.3proportionately by or for the owners of the other entity under provisions similar to those
160.4of section 267(c)(1) and (5) of the Internal Revenue Code of 1986, as amended through
160.5December 31, 2004.
160.6EFFECTIVE DATE.This section is effective the day following final enactment.

160.7    Sec. 15. Minnesota Statutes 2006, section 287.20, subdivision 9, is amended to read:
160.8    Subd. 9. Reorganization. "Reorganization" means the transfer of substantially all
160.9of the assets of a corporation, a limited liability company, or a partnership not in the usual
160.10or regular course of business if at the time of the transfer the transfer qualifies as: (i) a
160.11corporate reorganization under section 368(a) of the Internal Revenue Code of 1986, as
160.12amended through December 31, 2004; or (ii) a transfer from a partnership to another
160.13partnership when the transferee is treated as a continuation of the transferor under section
160.14708 of the Internal Revenue Code of 1986, as amended through December 31, 2004.

160.15    Sec. 16. Minnesota Statutes 2006, section 287.20, is amended by adding a subdivision
160.16to read:
160.17    Subd. 10. Internal Revenue Code. Unless specifically defined otherwise, "Internal
160.18Revenue Code" means the Internal Revenue Code as defined in section 289A.02,
160.19subdivision 7.
160.20EFFECTIVE DATE.This section is effective the day following final enactment.

160.21    Sec. 17. Minnesota Statutes 2006, section 295.53, subdivision 4a, is amended to read:
160.22    Subd. 4a. Credit for research. (a) In addition to the exemptions allowed under
160.23subdivision 1, a hospital or health care provider may claim an annual credit against the
160.24total amount of tax, if any, the hospital or health care provider owes for that calendar year
160.25under sections 295.50 to 295.57. The credit shall equal 2.5 percent of revenues for patient
160.26services used to fund expenditures for qualifying research conducted by an allowable
160.27research program. The amount of the credit shall not exceed the tax liability of the hospital
160.28or health care provider under sections 295.50 to 295.57.
160.29    (b) For purposes of this subdivision, the following requirements apply:
160.30    (1) expenditures must be for program costs of qualifying research conducted by
160.31an allowable research program;
160.32    (2) an allowable research program must be a formal program of medical and health
160.33care research conducted by an entity which is exempt under section 501(c)(3) of the
161.1Internal Revenue Code of 1986 as defined in section 289A.02, subdivision 7, or is owned
161.2and operated under authority of a governmental unit;
161.3    (3) qualifying research must:
161.4    (A) be approved in writing by the governing body of the hospital or health care
161.5provider which is taking the deduction under this subdivision;
161.6    (B) have as its purpose the development of new knowledge in basic or applied
161.7science relating to the diagnosis and treatment of conditions affecting the human body;
161.8    (C) be subject to review by individuals with expertise in the subject matter of the
161.9proposed study but who have no financial interest in the proposed study and are not
161.10involved in the conduct of the proposed study; and
161.11    (D) be subject to review and supervision by an institutional review board operating
161.12in conformity with federal regulations if the research involves human subjects or
161.13an institutional animal care and use committee operating in conformity with federal
161.14regulations if the research involves animal subjects. Research expenses are not exempt if
161.15the study is a routine evaluation of health care methods or products used in a particular
161.16setting conducted for the purpose of making a management decision. Costs of clinical
161.17research activities paid directly for the benefit of an individual patient are excluded from
161.18this exemption. Basic research in fields including biochemistry, molecular biology, and
161.19physiology are also included if such programs are subject to a peer review process.
161.20    (c) No credit shall be allowed under this subdivision for any revenue received by the
161.21hospital or health care provider in the form of a grant, gift, or otherwise, whether from a
161.22government or nongovernment source, on which the tax liability under section 295.52 is
161.23not imposed.
161.24    (d) The taxpayer shall apply for the credit under this section on the annual return
161.25under section 295.55, subdivision 5.
161.26    (e) Beginning September 1, 2001, if the actual or estimated amount paid under
161.27this section for the calendar year exceeds $2,500,000, the commissioner of finance shall
161.28determine the rate of the research credit for the following calendar year to the nearest
161.29one-half percent so that refunds paid under this section will most closely equal $2,500,000.
161.30The commissioner of finance shall publish in the State Register by October 1 of each year
161.31the rate of the credit for the following calendar year. A determination under this section
161.32is not subject to the rulemaking provisions of chapter 14.
161.33EFFECTIVE DATE.This section is effective the day following final enactment.

161.34    Sec. 18. Minnesota Statutes 2006, section 296A.16, subdivision 2, is amended to read:
162.1    Subd. 2. Fuel used in other vehicle; claim for refund. Any person who buys and
162.2uses gasoline for a qualifying purpose other than use in motor vehicles, snowmobiles
162.3except as provided in clause (2), or motorboats, or special fuel for a qualifying purpose
162.4other than use in licensed motor vehicles, and who paid the tax directly or indirectly
162.5through the amount of the tax being included in the price of the gasoline or special fuel, or
162.6otherwise, shall be reimbursed and repaid the amount of the tax paid upon filing with the
162.7commissioner a claim for refund in the form and manner prescribed by the commissioner,
162.8and containing the information the commissioner shall require. By signing any such claim
162.9which is false or fraudulent, the applicant shall be subject to the penalties provided in this
162.10chapter for knowingly making a false claim. The claim shall set forth the total amount
162.11of the gasoline so purchased and used by the applicant other than in motor vehicles, or
162.12special fuel purchased and used by the applicant other than in licensed motor vehicles,
162.13and shall state when and for what purpose it was used. When a claim contains an error
162.14in computation or preparation, the commissioner is authorized to adjust the claim in
162.15accordance with the evidence shown on the claim or other information available to the
162.16commissioner. The commissioner, on being satisfied that the claimant is entitled to the
162.17payments, shall approve the claim and transmit it to the commissioner of finance. The
162.18words "gasoline" or "special fuel" as used in this subdivision do not include aviation
162.19gasoline or special fuel for aircraft. Gasoline or special fuel bought and used for a
162.20"qualifying purpose" means:
162.21    (1) Gasoline or special fuel used in carrying on a trade or business, used on a farm
162.22situated in Minnesota, and used for a farming purpose. "Farm" and "farming purpose"
162.23have the meanings given them in section 6420(c)(2), (3), and (4) of the Internal Revenue
162.24Code of 1986, as amended through December 31, 1997 as defined in section 289A.02,
162.25subdivision 7.
162.26    (2) Gasoline or special fuel used for off-highway business use.
162.27    (i) "Off-highway business use" means any use off the public highway by a person in
162.28that person's trade, business, or activity for the production of income.
162.29    (ii) Off-highway business use includes use of a passenger snowmobile off the public
162.30highways as part of the operations of a resort as defined in section 157.15, subdivision 11;
162.31and use of gasoline or special fuel to operate a power takeoff unit on a vehicle, but not
162.32including fuel consumed during idling time.
162.33    (iii) Off-highway business use does not include use as a fuel in a motor vehicle
162.34which, at the time of use, is registered or is required to be registered for highway use under
162.35the laws of any state or foreign country; or use of a licensed motor vehicle fuel tank in lieu
162.36of a separate storage tank for storing fuel to be used for a qualifying purpose, as defined in
163.1this section. Fuel purchased to be used for a qualifying purpose cannot be placed in the
163.2fuel tank of a licensed motor vehicle and must be stored in a separate supply tank.
163.3    (3) Gasoline or special fuel placed in the fuel tanks of new motor vehicles,
163.4manufactured in Minnesota, and shipped by interstate carrier to destinations in other
163.5states or foreign countries.
163.6EFFECTIVE DATE.This section is effective the day following final enactment.

163.7    Sec. 19. Minnesota Statutes 2006, section 297A.61, subdivision 22, is amended to read:
163.8    Subd. 22. Internal Revenue Code. Unless specifically provided otherwise,
163.9"Internal Revenue Code" means the Internal Revenue Code of 1986, as amended through
163.10December 31, 2000 as defined in section 289A.02, subdivision 7.
163.11EFFECTIVE DATE.This section is effective the day following final enactment.

163.12    Sec. 20. Minnesota Statutes 2006, section 297B.01, subdivision 7, is amended to read:
163.13    Subd. 7. Sale, sells, selling, purchase, purchased, or acquired. (a) "Sale," "sells,"
163.14"selling," "purchase," "purchased," or "acquired" means any transfer of title of any motor
163.15vehicle, whether absolutely or conditionally, for a consideration in money or by exchange
163.16or barter for any purpose other than resale in the regular course of business.
163.17    (b) Any motor vehicle utilized by the owner only by leasing such vehicle to others
163.18or by holding it in an effort to so lease it, and which is put to no other use by the owner
163.19other than resale after such lease or effort to lease, shall be considered property purchased
163.20for resale.
163.21    (c) The terms also shall include any transfer of title or ownership of a motor vehicle
163.22by other means, for or without consideration, except that these terms shall not include:
163.23    (1) the acquisition of a motor vehicle by inheritance from or by bequest of, a
163.24decedent who owned it;
163.25    (2) the transfer of a motor vehicle which was previously licensed in the names of
163.26two or more joint tenants and subsequently transferred without monetary consideration to
163.27one or more of the joint tenants;
163.28    (3) the transfer of a motor vehicle by way of gift between individuals, or gift
163.29from a limited used vehicle dealer licensed under section 168.27, subdivision 4a, to an
163.30individual, when the transfer is with no monetary or other consideration or expectation
163.31of consideration and the parties to the transfer submit an affidavit to that effect at the
163.32time the title transfer is recorded;
163.33    (4) the voluntary or involuntary transfer of a motor vehicle between a husband and
163.34wife in a divorce proceeding; or
164.1    (5) the transfer of a motor vehicle by way of a gift to an organization that is exempt
164.2from federal income taxation under section 501(c)(3) of the Internal Revenue Code, as
164.3amended through December 31, 1996, when the motor vehicle will be used exclusively for
164.4religious, charitable, or educational purposes.
164.5EFFECTIVE DATE.This section is effective the day following final enactment.

164.6    Sec. 21. Minnesota Statutes 2006, section 297B.01, is amended by adding a
164.7subdivision to read:
164.8    Subd. 10. Internal Revenue Code. Unless specifically defined otherwise, "Internal
164.9Revenue Code" means the Internal Revenue Code as defined in section 289A.02,
164.10subdivision 7.
164.11EFFECTIVE DATE.This section is effective the day following final enactment.

164.12    Sec. 22. Minnesota Statutes 2006, section 297B.03, is amended to read:
164.13297B.03 EXEMPTIONS.
164.14    There is specifically exempted from the provisions of this chapter and from
164.15computation of the amount of tax imposed by it the following:
164.16    (1) purchase or use, including use under a lease purchase agreement or installment
164.17sales contract made pursuant to section 465.71, of any motor vehicle by the United States
164.18and its agencies and instrumentalities and by any person described in and subject to the
164.19conditions provided in section 297A.67, subdivision 11;
164.20    (2) purchase or use of any motor vehicle by any person who was a resident of
164.21another state or country at the time of the purchase and who subsequently becomes a
164.22resident of Minnesota, provided the purchase occurred more than 60 days prior to the date
164.23such person began residing in the state of Minnesota and the motor vehicle was registered
164.24in the person's name in the other state or country;
164.25    (3) purchase or use of any motor vehicle by any person making a valid election to be
164.26taxed under the provisions of section 297A.90;
164.27    (4) purchase or use of any motor vehicle previously registered in the state of
164.28Minnesota when such transfer constitutes a transfer within the meaning of section 118,
164.29331, 332, 336, 337, 338, 351, 355, 368, 721, 731, 1031, 1033, or 1563(a) of the Internal
164.30Revenue Code of 1986, as amended through December 31, 1999;
164.31    (5) purchase or use of any vehicle owned by a resident of another state and leased
164.32to a Minnesota-based private or for-hire carrier for regular use in the transportation of
164.33persons or property in interstate commerce provided the vehicle is titled in the state of
165.1the owner or secured party, and that state does not impose a sales tax or sales tax on
165.2motor vehicles used in interstate commerce;
165.3    (6) purchase or use of a motor vehicle by a private nonprofit or public educational
165.4institution for use as an instructional aid in automotive training programs operated by the
165.5institution. "Automotive training programs" includes motor vehicle body and mechanical
165.6repair courses but does not include driver education programs;
165.7    (7) purchase of a motor vehicle for use as an ambulance by an ambulance service
165.8licensed under section 144E.10;
165.9    (8) purchase of a motor vehicle by or for a public library, as defined in section
165.10134.001, subdivision 2 , as a bookmobile or library delivery vehicle;
165.11    (9) purchase of a ready-mixed concrete truck;
165.12    (10) purchase or use of a motor vehicle by a town for use exclusively for road
165.13maintenance, including snowplows and dump trucks, but not including automobiles,
165.14vans, or pickup trucks;
165.15    (11) purchase or use of a motor vehicle by a corporation, society, association,
165.16foundation, or institution organized and operated exclusively for charitable, religious,
165.17or educational purposes, except a public school, university, or library, but only if the
165.18vehicle is:
165.19    (i) a truck, as defined in section 168.011, a bus, as defined in section 168.011, or a
165.20passenger automobile, as defined in section 168.011, if the automobile is designed and
165.21used for carrying more than nine persons including the driver; and
165.22    (ii) intended to be used primarily to transport tangible personal property or
165.23individuals, other than employees, to whom the organization provides service in
165.24performing its charitable, religious, or educational purpose;
165.25    (12) purchase of a motor vehicle for use by a transit provider exclusively to provide
165.26transit service is exempt if the transit provider is either (i) receiving financial assistance or
165.27reimbursement under section 174.24 or 473.384, or (ii) operating under section 174.29,
165.28473.388 , or 473.405;
165.29    (13) purchase or use of a motor vehicle by a qualified business, as defined in section
165.30469.310 , located in a job opportunity building zone, if the motor vehicle is principally
165.31garaged in the job opportunity building zone and is primarily used as part of or in direct
165.32support of the person's operations carried on in the job opportunity building zone. The
165.33exemption under this clause applies to sales, if the purchase was made and delivery
165.34received during the duration of the job opportunity building zone. The exemption under
165.35this clause also applies to any local sales and use tax.
165.36EFFECTIVE DATE.This section is effective the day following final enactment.

166.1    Sec. 23. Minnesota Statutes 2006, section 297F.01, subdivision 8, is amended to read:
166.2    Subd. 8. Internal Revenue Code. Unless specifically defined otherwise, "Internal
166.3Revenue Code" means the Internal Revenue Code of 1986, as amended through December
166.431, 1996 as defined in section 289A.02, subdivision 7.
166.5EFFECTIVE DATE.This section is effective the day following final enactment.

166.6    Sec. 24. Minnesota Statutes 2006, section 297G.01, subdivision 9, is amended to read:
166.7    Subd. 9. Internal Revenue Code. Unless specifically defined otherwise, "Internal
166.8Revenue Code" means the Internal Revenue Code of 1986, as amended through December
166.931, 1996 as defined in section 289A.02, subdivision 7.
166.10EFFECTIVE DATE.This section is effective the day following final enactment.

166.11    Sec. 25. Minnesota Statutes 2006, section 297H.09, is amended to read:
166.12297H.09 BAD DEBTS.
166.13    The remitter of the solid waste management tax may offset against the tax payable,
166.14with respect to any reporting period, the amount of tax imposed by this chapter previously
166.15remitted to the commissioner of revenue which qualified as a bad debt under section
166.16166(a) of the Internal Revenue Code, as amended through December 31, 1993 defined
166.17in section 289A.02, subdivision 7, during such reporting period, but only in proportion
166.18to the portion of such debt which became uncollectable. This section applies only to
166.19accrual basis remitters that remit tax before it is collected and to the extent they are
166.20unable to collect the tax.
166.21EFFECTIVE DATE.This section is effective the day following final enactment.


166.24    Section 1. Minnesota Statutes 2006, section 289A.18, subdivision 1, as amended by
166.25Laws 2008, chapter 154, article 11, section 5, is amended to read:
166.26    Subdivision 1. Individual income, fiduciary income, corporate franchise, and
166.27entertainment taxes; partnership and S corporation returns; information returns;
166.28mining company returns. The returns required to be made under sections 289A.08 and
166.29289A.12 must be filed at the following times:
166.30    (1) returns made on the basis of the calendar year must be filed on April 15 following
166.31the close of the calendar year, except that returns of corporations must be filed on March
166.3215 following the close of the calendar year;
167.1    (2) returns made on the basis of the fiscal year must be filed on the 15th day of the
167.2fourth month following the close of the fiscal year, except that returns of corporations
167.3must be filed on the 15th day of the third month following the close of the fiscal year;
167.4    (3) returns for a fractional part of a year must be filed on the 15th day of the fourth
167.5month following the end of the month in which falls the last day of the period for which
167.6the return is made, except that the returns of corporations must be filed on the 15th day of
167.7the third month following the end of the tax year; or, in the case of a corporation which is
167.8a member of a unitary group, the return of the corporation must be filed on the 15th day of
167.9the third month following the end of the tax year of the unitary group in which falls the
167.10last day of the period for which the return is made;
167.11    (4) in the case of a final return of a decedent for a fractional part of a year, the return
167.12must be filed on the 15th day of the fourth month following the close of the 12-month
167.13period that began with the first day of that fractional part of a year;
167.14    (5) in the case of the return of a cooperative association, returns must be filed on or
167.15before the 15th day of the ninth month following the close of the taxable year;
167.16    (6) if a corporation has been divested from a unitary group and files a return for
167.17a fractional part of a year in which it was a member of a unitary business that files a
167.18combined report under section 290.34 290.17, subdivision 2 4, the divested corporation's
167.19return must be filed on the 15th day of the third month following the close of the common
167.20accounting period that includes the fractional year;
167.21    (7) returns of entertainment entities must be filed on April 15 following the close of
167.22the calendar year;
167.23    (8) returns required to be filed under section 289A.08, subdivision 4, must be filed
167.24on the 15th day of the fifth month following the close of the taxable year;
167.25    (9) returns of mining companies must be filed on May 1 following the close of the
167.26calendar year; and
167.27    (10) returns required to be filed with the commissioner under section 289A.12,
167.28subdivision 2 or 4 to 10, must be filed within 30 days after being demanded by the
167.29commissioner.
167.30EFFECTIVE DATE.This section is effective the day following final enactment
167.31except that the change in clause (6) is effective for taxable years beginning after December
167.3231, 2007.

167.33    Sec. 2. Minnesota Statutes 2006, section 290.01, subdivision 6b, is amended to read:
168.1    Subd. 6b. Foreign operating corporation. The term "foreign operating
168.2corporation," when applied to a corporation, means a domestic corporation with the
168.3following characteristics:
168.4    (1) it is part of a unitary business at least one member of which is taxable in this state;
168.5    (2) it is not a foreign sales corporation under section 922 of the Internal Revenue
168.6Code, as amended through December 31, 1999, for the taxable year;
168.7    (3)(i) the average of the percentages of its property and payrolls, including the pro
168.8rata share of its unitary partnerships' property and payrolls, assigned to locations outside
168.9the United States, where the United States includes the District of Columbia and excludes
168.10the commonwealth of Puerto Rico and possessions of the United States, as determined
168.11under section 290.191 or 290.20, is 80 percent or more; or (ii) it has in effect a valid
168.12election under section 936 of the Internal Revenue Code; and
168.13    (4) it has a minimum of $1,000,000 of payroll and $2,000,000 of property, as
168.14determined under section 290.191 or 290.20, that are located outside the United States. If
168.15the domestic corporation does not have payroll as determined under section 290.191 or
168.16290.20 , but it or its partnerships have paid $1,000,000 for work, performed directly for the
168.17domestic corporation or the partnerships, outside the United States, then paragraph (3)(i)
168.18shall not require payrolls to be included in the average calculation.
168.19EFFECTIVE DATE.This section is effective the day following final enactment.

168.20    Sec. 3. Minnesota Statutes 2006, section 290.068, subdivision 3, is amended to read:
168.21    Subd. 3. Limitation; carryover. (a)(1) The credit for the taxable year shall not
168.22exceed the liability for tax. "Liability for tax" for purposes of this section means the tax
168.23imposed under this chapter section 290.06, subdivision 1, for the taxable year reduced by
168.24the sum of the nonrefundable credits allowed under this chapter.
168.25    (2) In the case of a corporation which is a partner in a partnership, the credit allowed
168.26for the taxable year shall not exceed the lesser of the amount determined under clause (1)
168.27for the taxable year or an amount (separately computed with respect to the corporation's
168.28interest in the trade or business or entity) equal to the amount of tax attributable to that
168.29portion of taxable income which is allocable or apportionable to the corporation's interest
168.30in the trade or business or entity.
168.31    (b) If the amount of the credit determined under this section for any taxable year
168.32exceeds the limitation under clause (a), the excess shall be a research credit carryover to
168.33each of the 15 succeeding taxable years. The entire amount of the excess unused credit for
168.34the taxable year shall be carried first to the earliest of the taxable years to which the credit
168.35may be carried and then to each successive year to which the credit may be carried. The
169.1amount of the unused credit which may be added under this clause shall not exceed the
169.2taxpayer's liability for tax less the research credit for the taxable year.
169.3EFFECTIVE DATE.This section is effective for taxable years beginning after
169.4December 31, 2007.

169.5    Sec. 4. Minnesota Statutes 2006, section 290.07, subdivision 1, is amended to read:
169.6    Subdivision 1. Annual accounting period. Net income and taxable net income
169.7shall be computed upon the basis of the taxpayer's annual accounting period. If a taxpayer
169.8has no annual accounting period, or has one other than a fiscal year, as heretofore defined,
169.9the net income and taxable net income shall be computed on the basis of the calendar year.
169.10Taxpayers shall employ the same accounting period on which they report, or would be
169.11required to report, their net income under the Internal Revenue Code. The commissioner
169.12shall provide by rule for the determination of the accounting period for taxpayers who
169.13file a combined report under section 290.34 290.17, subdivision 2 4, when members of
169.14the group use different accounting periods for federal income tax purposes. Unless the
169.15taxpayer changes its accounting period for federal purposes, the due date of the return
169.16is not changed.
169.17    A taxpayer may change accounting periods only with the consent of the
169.18commissioner. In case of any such change, the taxpayer shall pay a tax for the period
169.19not included in either the taxpayer's former or newly adopted taxable year, computed as
169.20provided in section 290.32.
169.21EFFECTIVE DATE.This section is effective for taxable years beginning after
169.22December 31, 2007.

169.23    Sec. 5. Minnesota Statutes 2006, section 290.21, subdivision 4, is amended to read:
169.24    Subd. 4. Dividends received from another corporation. (a)(1) Eighty percent
169.25of dividends received by a corporation during the taxable year from another corporation,
169.26in which the recipient owns 20 percent or more of the stock, by vote and value, not
169.27including stock described in section 1504(a)(4) of the Internal Revenue Code when the
169.28corporate stock with respect to which dividends are paid does not constitute the stock in
169.29trade of the taxpayer or would not be included in the inventory of the taxpayer, or does not
169.30constitute property held by the taxpayer primarily for sale to customers in the ordinary
169.31course of the taxpayer's trade or business, or when the trade or business of the taxpayer
169.32does not consist principally of the holding of the stocks and the collection of the income
169.33and gains therefrom; and
170.1    (2)(i) the remaining 20 percent of dividends if the dividends received are the stock in
170.2an affiliated company transferred in an overall plan of reorganization and the dividend
170.3is eliminated in consolidation under Treasury Department Regulation 1.1502-14(a), as
170.4amended through December 31, 1989;
170.5    (ii) the remaining 20 percent of dividends if the dividends are received from a
170.6corporation which is subject to tax under section 290.36 and which is a member of an
170.7affiliated group of corporations as defined by the Internal Revenue Code and the dividend
170.8is eliminated in consolidation under Treasury Department Regulation 1.1502-14(a), as
170.9amended through December 31, 1989, or is deducted under an election under section
170.10243(b) of the Internal Revenue Code; or
170.11    (iii) the remaining 20 percent of the dividends if the dividends are received from a
170.12property and casualty insurer as defined under section 60A.60, subdivision 8, which is a
170.13member of an affiliated group of corporations as defined by the Internal Revenue Code
170.14and either: (A) the dividend is eliminated in consolidation under Treasury Regulation
170.151.1502-14(a), as amended through December 31, 1989; or (B) the dividend is deducted
170.16under an election under section 243(b) of the Internal Revenue Code.
170.17    (b) Seventy percent of dividends received by a corporation during the taxable year
170.18from another corporation in which the recipient owns less than 20 percent of the stock,
170.19by vote or value, not including stock described in section 1504(a)(4) of the Internal
170.20Revenue Code when the corporate stock with respect to which dividends are paid does not
170.21constitute the stock in trade of the taxpayer, or does not constitute property held by the
170.22taxpayer primarily for sale to customers in the ordinary course of the taxpayer's trade or
170.23business, or when the trade or business of the taxpayer does not consist principally of the
170.24holding of the stocks and the collection of income and gain therefrom.
170.25    (c) The dividend deduction provided in this subdivision shall be allowed only with
170.26respect to dividends that are included in a corporation's Minnesota taxable net income
170.27for the taxable year.
170.28    The dividend deduction provided in this subdivision does not apply to a dividend
170.29from a corporation which, for the taxable year of the corporation in which the distribution
170.30is made or for the next preceding taxable year of the corporation, is a corporation exempt
170.31from tax under section 501 of the Internal Revenue Code.
170.32    The dividend deduction provided in this subdivision applies to the amount of
170.33regulated investment company dividends only to the extent determined under section
170.34854(b) of the Internal Revenue Code.
171.1    The dividend deduction provided in this subdivision shall not be allowed with
171.2respect to any dividend for which a deduction is not allowed under the provisions of
171.3section 246(c) of the Internal Revenue Code.
171.4    (d) If dividends received by a corporation that does not have nexus with Minnesota
171.5under the provisions of Public Law 86-272 are included as income on the return of
171.6an affiliated corporation permitted or required to file a combined report under section
171.7290.17, subdivision 4 or 290.34, subdivision 2, then for purposes of this subdivision the
171.8determination as to whether the trade or business of the corporation consists principally
171.9of the holding of stocks and the collection of income and gains therefrom shall be made
171.10with reference to the trade or business of the affiliated corporation having a nexus with
171.11Minnesota.
171.12    (e) The deduction provided by this subdivision does not apply if the dividends are
171.13paid by a FSC as defined in section 922 of the Internal Revenue Code.
171.14    (f) If one or more of the members of the unitary group whose income is included on
171.15the combined report received a dividend, the deduction under this subdivision for each
171.16member of the unitary business required to file a return under this chapter is the product
171.17of: (1) 100 percent of the dividends received by members of the group; (2) the percentage
171.18allowed pursuant to paragraph (a) or (b); and (3) the percentage of the taxpayer's business
171.19income apportionable to this state for the taxable year under section 290.191 or 290.20.
171.20EFFECTIVE DATE.This section is effective for taxable years beginning after
171.21December 31, 2007.

171.22    Sec. 6. Minnesota Statutes 2006, section 290.92, subdivision 26, is amended to read:
171.23    Subd. 26. Extension of withholding to certain payments where identifying
171.24number not furnished or inaccurate. (a) If, in the case of any reportable payment, (1)
171.25the payee fails to furnish the payee's Social Security account number to the payor, or
171.26(2) the payee is subject to federal backup withholding on the reportable payment under
171.27section 3406 of the Internal Revenue Code, or (3) the commissioner notifies the payor that
171.28the Social Security account number furnished by the payee is incorrect, then the payor
171.29shall deduct and withhold from the payment a tax equal to the amount of the payment
171.30multiplied by the highest rate used in determining the income tax liability of an individual
171.31under section 290.06, subdivision 2c.
171.32    (b)(1) In the case of any failure described in clause (a)(1), clause (a) shall apply to
171.33any reportable payment made by the payor during the period during which the Social
171.34Security account number has not been furnished.
172.1    (2) In any case where there is a notification described in clause (a)(2)(3), clause (a)
172.2shall apply to any reportable payment made by the payor (i) after the close of the 30th
172.3day after the day on which the payor received the notification, and (ii) before the payee
172.4furnishes another Social Security account number.
172.5    (3)(i) Unless the payor elects not to have this subparagraph apply with respect to
172.6the payee, clause (a) shall also apply to any reportable payment made after the close of
172.7the period described in paragraph (1) or (2) (as the case may be) and before the 30th
172.8day after the close of the period.
172.9    (ii) If the payor elects the application of this subparagraph with respect to the payee,
172.10clause (a) shall also apply to any reportable payment made during the 30-day period
172.11described in paragraph (2).
172.12    (iii) The payor may elect a period shorter than the grace period set forth in
172.13subparagraph (i) or (ii) as the case may be.
172.14    (c) The provisions of section 3406 of the Internal Revenue Code shall apply and
172.15shall govern when withholding shall be required and the definition of terms. The term
172.16"reportable payment" shall include only those payments for personal services. No tax
172.17shall be deducted or withheld under this subdivision with respect to any amount for
172.18which withholding is otherwise required under this section. For purposes of this section,
172.19payments which are subject to withholding under this subdivision shall be treated as if
172.20they were wages paid by an employer to an employee and amounts deducted and withheld
172.21under this subdivision shall be treated as if deducted and withheld under subdivision 2a.
172.22    (d) Whenever the commissioner notifies a payor under this subdivision that the
172.23Social Security account number furnished by any payee is incorrect, the commissioner
172.24shall at the same time furnish a copy of the notice to the payor, and the payor shall
172.25promptly furnish the copy to the payee. If the commissioner notifies a payor under this
172.26subdivision that the Social Security account number furnished by any payee is incorrect
172.27and the payee subsequently furnishes another Social Security account number to the
172.28payor, the payor shall promptly notify the commissioner of the other Social Security
172.29account number furnished.
172.30EFFECTIVE DATE.This section is effective for payments made after December
172.3131, 2008.

172.32    Sec. 7. Minnesota Statutes 2006, section 290.92, subdivision 31, as added by Laws
172.332008, chapter 154, article 3, section 8, is amended to read:
172.34    Subd. 31. Payments to persons who are not employees. (a) For purposes of this
172.35subdivision, "contractor" means a person carrying on a trade or business described in
173.1industry code numbers 23 through 238990 of the North American Industry Classification
173.2System.
173.3    (b) A contractor or a third-party bulk filer acting on behalf of a contractor, who
173.4makes payments to an individual, carrying on a trade or business described in paragraph
173.5(a) as a sole proprietorship, must deduct and withhold two percent of the payment as
173.6Minnesota withholding tax when the amount the contractor paid to that individual during
173.7the calendar year exceeds $600.
173.8    (c) A payment subject to withholding under this subdivision must be treated as if
173.9the payment were a wage paid by an employer to an employee. The requirements in the
173.10definitions of "employee" and "employer" in subdivision 1 relating to geographic location
173.11apply in determining whether withholding tax applies under this subdivision, but without
173.12regard to whether the contractor or the individual otherwise satisfy the definition of an
173.13employer or an employee. Each recipient of a payment subject to withholding under this
173.14subdivision must furnish the contractor with a statement of the recipient's name, address,
173.15and Social Security account number.
173.16EFFECTIVE DATE.This section is effective the day following final enactment.

173.17    Sec. 8. Laws 2008, chapter 154, article 3, section 7, the effective date, is amended to
173.18read:
173.19EFFECTIVE DATE.This section is effective for taxable years beginning
173.20after December 31, 2007, except that to the extent this section impacts an employer's
173.21requirement to withhold Minnesota tax, the requirement to withhold is effective for wages
173.22paid after April 1 December 31, 2008.

173.23    Sec. 9. REPEALER.
173.24Minnesota Rules, part 8031.0100, subpart 3, is repealed effective the day following
173.25final enactment.
173.26Minnesota Rules, part 8093.2100, is repealed effective the day following final
173.27enactment.


173.30    Section 1. Minnesota Statutes 2006, section 289A.55, is amended by adding a
173.31subdivision to read:
173.32    Subd. 10. Relief for purchasers. A purchaser that meets the requirements of section
173.33297A.995, subdivision 11, is relieved from the imposition of interest on tax and penalty.
174.1EFFECTIVE DATE.This section is effective for sales and purchases made after
174.2December 31, 2008.

174.3    Sec. 2. Minnesota Statutes 2006, section 289A.60, is amended by adding a subdivision
174.4to read:
174.5    Subd. 29. Relief for purchasers. A purchaser that meets the requirements of
174.6section 297A.995, subdivision 11, is relieved from the imposition of penalty.
174.7EFFECTIVE DATE.This section is effective for sales and purchases made after
174.8December 31, 2008.

174.9    Sec. 3. Minnesota Statutes 2006, section 297A.61, subdivision 29, is amended to read:
174.10    Subd. 29. State. Unless specifically provided otherwise, "state" means any state of
174.11the United States, the Commonwealth of Puerto Rico, and the District of Columbia.
174.12EFFECTIVE DATE.This section is effective the day following final enactment.

174.13    Sec. 4. Minnesota Statutes 2006, section 297A.665, as amended by Laws 2008, chapter
174.14154, article 12, section 20, is amended to read:
174.15297A.665 PRESUMPTION OF TAX; BURDEN OF PROOF.
174.16    (a) For the purpose of the proper administration of this chapter and to prevent
174.17evasion of the tax, until the contrary is established, it is presumed that:
174.18    (1) all gross receipts are subject to the tax; and
174.19    (2) all retail sales for delivery in Minnesota are for storage, use, or other consumption
174.20in Minnesota.
174.21    (b) The burden of proving that a sale is not a taxable retail sale is on the seller.
174.22However, a seller is relieved of liability if:
174.23    (1) the seller obtains a fully completed exemption certificate or all the relevant
174.24information required by section 297A.72, subdivision 2, at the time of the sale or within
174.2590 days after the date of the sale; or
174.26    (2) if the seller has not obtained a fully completed exemption certificate or all the
174.27relevant information required by section 297A.72, subdivision 2, within the time provided
174.28in clause (1), within 120 days after a request for substantiation by the commissioner,
174.29the seller either:
174.30    (i) obtains in good faith a fully completed exemption certificate or all the relevant
174.31information required by section 297A.72, subdivision 2, from the purchaser; or
174.32    (ii) proves by other means that the transaction was not subject to tax.
174.33    (c) Notwithstanding paragraph (b), relief from liability does not apply to a seller who:
175.1    (1) fraudulently fails to collect the tax; or
175.2    (2) solicits purchasers to participate in the unlawful claim of an exemption.
175.3    (d) A certified service provider, as defined in section 297A.995, subdivision 2, is
175.4relieved of liability under this section to the extent a seller who is its client is relieved of
175.5liability.
175.6    (d) (e) A purchaser of tangible personal property or any items listed in section
175.7297A.63 that are shipped or brought to Minnesota by the purchaser has the burden
175.8of proving that the property was not purchased from a retailer for storage, use, or
175.9consumption in Minnesota.
175.10EFFECTIVE DATE.This section is effective retroactively for sales and purchases
175.11made after December 31, 2007.

175.12    Sec. 5. Minnesota Statutes 2006, section 297A.67, subdivision 7, as amended by Laws
175.132008, chapter 154, article 12, section 26, is amended to read:
175.14    Subd. 7. Drugs; medical devices. (a) Sales of the following drugs and medical
175.15devices for human use are exempt:
175.16    (1) drugs for human use, including over-the-counter drugs;
175.17    (2) single-use finger-pricking devices for the extraction of blood and other single-use
175.18devices and single-use diagnostic agents used in diagnosing, monitoring, or treating
175.19diabetes;
175.20    (3) insulin and medical oxygen for human use, regardless of whether prescribed
175.21or sold over the counter;
175.22    (4) prosthetic devices;
175.23    (5) durable medical equipment for home use only;
175.24    (6) mobility enhancing equipment;
175.25    (7) prescription corrective eyeglasses; and
175.26    (8) kidney dialysis equipment, including repair and replacement parts.
175.27    (b) For purposes of this subdivision:
175.28    (1) "Drug" means a compound, substance, or preparation, and any component of
175.29a compound, substance, or preparation, other than food and food ingredients, dietary
175.30supplements, or alcoholic beverages that is:
175.31    (i) recognized in the official United States Pharmacopoeia, official Homeopathic
175.32Pharmacopoeia of the United States, or official National Formulary, and supplement
175.33to any of them;
175.34    (ii) intended for use in the diagnosis, cure, mitigation, treatment, or prevention
175.35of disease; or
176.1    (iii) intended to affect the structure or any function of the body.
176.2    (2) "Durable medical equipment" means equipment, including repair and
176.3replacement parts, but not including mobility enhancing equipment, that:
176.4    (i) can withstand repeated use;
176.5    (ii) is primarily and customarily used to serve a medical purpose;
176.6    (iii) generally is not useful to a person in the absence of illness or injury; and
176.7    (iv) is not worn in or on the body.
176.8    For purposes of this clause, "repair and replacement parts" includes all components
176.9or attachments used in conjunction with the durable medical equipment, but does not
176.10include repair and replacement parts which are for single patient use only.
176.11    (3) "Mobility enhancing equipment" means equipment, including repair and
176.12replacement parts, but not including durable medical equipment, that:
176.13    (i) is primarily and customarily used to provide or increase the ability to move from
176.14one place to another and that is appropriate for use either in a home or a motor vehicle;
176.15    (ii) is not generally used by persons with normal mobility; and
176.16    (iii) does not include any motor vehicle or equipment on a motor vehicle normally
176.17provided by a motor vehicle manufacturer.
176.18    (4) "Over-the-counter drug" means a drug that contains a label that identifies the
176.19product as a drug as required by Code of Federal Regulations, title 21, section 201.66. The
176.20label must include a "drug facts" panel or a statement of the active ingredients with a list of
176.21those ingredients contained in the compound, substance, or preparation. Over-the-counter
176.22drugs do not include grooming and hygiene products, regardless of whether they otherwise
176.23meet the definition. "Grooming and hygiene products" are soaps, cleaning solutions,
176.24shampoo, toothpaste, mouthwash, antiperspirants, and suntan lotions and sunscreens.
176.25    (5) "Prescribed" and "prescription" means a direction in the form of an order,
176.26formula, or recipe issued in any form of oral, written, electronic, or other means of
176.27transmission by a duly licensed health care professional.
176.28    (6) "Prosthetic device" means a replacement, corrective, or supportive device,
176.29including repair and replacement parts, worn on or in the body to:
176.30    (i) artificially replace a missing portion of the body;
176.31    (ii) prevent or correct physical deformity or malfunction; or
176.32    (iii) support a weak or deformed portion of the body.
176.33Prosthetic device does not include corrective eyeglasses.
176.34    (7) "Kidney dialysis equipment" means equipment that:
176.35    (i) is used to remove waste products that build up in the blood when the kidneys are
176.36not able to do so on their own; and
177.1    (ii) can withstand repeated use, including multiple use by a single patient,
177.2notwithstanding the provisions of clause (2).
177.3EFFECTIVE DATE.This section is effective the day following final enactment.

177.4    Sec. 6. Minnesota Statutes 2006, section 297A.995, subdivision 10, is amended to read:
177.5    Subd. 10. Relief from certain liability. (a) Notwithstanding subdivision 9, sellers
177.6and certified service providers are relieved from liability to the state for having charged
177.7and collected the incorrect amount of sales or use tax resulting from the seller or certified
177.8service provider (1) relying on erroneous data provided by this state the commissioner
177.9in the database files on tax rates, boundaries, or taxing jurisdiction assignments, or (2)
177.10relying on erroneous data provided by the state in its taxability matrix concerning the
177.11taxability of products and services.
177.12    (b) Notwithstanding subdivision 9, sellers and certified service providers are
177.13relieved from liability to the state for having charged and collected the incorrect amount
177.14of sales or use tax resulting from the seller or certified service provider relying on the
177.15certification by the commissioner as to the accuracy of a certified automated system as to
177.16the taxability of product categories. The relief from liability provided by this paragraph
177.17does not apply when the sellers or certified service providers have incorrectly classified
177.18an item or transaction into a product category, unless the item or transaction within a
177.19product category was approved by the commissioner or approved jointly by the states that
177.20are signatories to the agreement. The sellers and certified service providers must revise a
177.21classification within ten days after receipt of notice from the commissioner that an item or
177.22transaction within a product category is incorrectly classified as to its taxability, or they
177.23are not relieved from liability for the incorrect classification following the notification.
177.24EFFECTIVE DATE.This section is effective retroactively for sales and purchases
177.25made after December 31, 2007.

177.26    Sec. 7. Minnesota Statutes 2006, section 297A.995, is amended by adding a
177.27subdivision to read:
177.28    Subd. 11. Purchaser relief from certain liability. (a) Notwithstanding other
177.29provisions in the law, a purchaser is relieved from liability resulting from having paid
177.30the incorrect amount of sales or use tax if a purchaser, whether or not holding a direct
177.31pay permit, or a purchaser's seller or certified service provider relied on erroneous data
177.32provided by this state in the database files on tax rates, boundaries, taxing jurisdiction
177.33assignments, or in the taxability matrix. After providing an address-based database for
178.1assigning taxing jurisdictions and their associated rates, no relief for errors resulting from
178.2the purchaser's reliance on a database using zip codes is allowed.
178.3    (b) With respect to reliance on the taxability matrix provided by this state in
178.4paragraph (a), relief is limited to erroneous classifications in the taxability matrix for
178.5items included within the classifications as "taxable," "exempt," "included in sales
178.6price," "excluded from sales price," "included in the definition," and "excluded from
178.7the definition."
178.8EFFECTIVE DATE.This section is effective for sales and purchases made after
178.9December 31, 2008.

178.10    Sec. 8. Minnesota Statutes 2006, section 297A.995, is amended by adding a
178.11subdivision to read:
178.12    Subd. 12. Database files. For purposes of this section, "database files on tax rates,
178.13boundaries, and taxing jurisdiction assignments" and the "taxability matrix" means those
178.14databases and the taxability matrix required under the agreement.
178.15EFFECTIVE DATE.This section is effective retroactively for sales and purchases
178.16made after December 31, 2007.


178.19    Section 1. Minnesota Statutes 2007 Supplement, section 115A.1314, subdivision 2,
178.20is amended to read:
178.21    Subd. 2. Creation of account; appropriations. (a) The electronic waste account
178.22is established in the environmental fund. The commissioner of revenue must deposit
178.23receipts from the fee established in subdivision 1 in the account. Any interest earned on
178.24the account must be credited to the account. Money from other sources may be credited to
178.25the account. Beginning in the second program year and continuing each program year
178.26thereafter, as of the last day of each program year, the commissioner of revenue shall
178.27determine the total amount of the variable fees that were collected. By July 15, 2009, and
178.28each July 15 thereafter, the commissioner of the Pollution Control Agency shall inform
178.29the commissioner of revenue of the amount necessary to operate the program in the new
178.30program year. To the extent that the total fees collected by the commissioner of revenue in
178.31connection with this section exceeds exceed the amount the commissioner of the Pollution
178.32Control Agency determines necessary to operate the program for the new program
178.33year, the commissioner of revenue shall refund on a pro rata basis, to all manufacturers
178.34who paid any fees for the previous program year, the amount of fees collected by the
179.1commissioner of revenue in excess of the amount necessary to operate the program for the
179.2new program year. No individual refund is required of amounts of $100 or less for a fiscal
179.3year. Manufacturers who report collections less than 50 percent of their obligation for the
179.4previous program year are not eligible for a refund. Amounts not refunded pursuant to this
179.5paragraph shall remain in the account. The commissioner of revenue shall issue refunds
179.6by August 10. In lieu of issuing a refund, the commissioner of revenue may grant credit
179.7against a manufacturer's variable fee due by September 1.
179.8    (b) Until June 30, 2009, money in the account is annually appropriated to the
179.9Pollution Control Agency:
179.10    (1) for the purpose of implementing sections 115A.1312 to 115A.1330, including
179.11transfer to the commissioner of revenue to carry out the department's duties under
179.12section 115A.1320, subdivision 2, and transfer to the commissioner of administration for
179.13responsibilities under section 115A.1324; and
179.14    (2) to the commissioner of the Pollution Control Agency to be distributed on a
179.15competitive basis through contracts with counties outside the 11-county metropolitan
179.16area, as defined in paragraph (c), and with private entities that collect for recycling
179.17covered electronic devices in counties outside the 11-county metropolitan area, where the
179.18collection and recycling is consistent with the respective county's solid waste plan, for
179.19the purpose of carrying out the activities under sections 115A.1312 to 115A.1330. In
179.20awarding competitive grants under this clause, the commissioner must give preference to
179.21counties and private entities that are working cooperatively with manufacturers to help
179.22them meet their recycling obligations under section 115A.1318, subdivision 1.
179.23    (c) The 11-county metropolitan area consists of the counties of Anoka, Carver,
179.24Chisago, Dakota, Hennepin, Isanti, Ramsey, Scott, Sherburne, Washington, and Wright.
179.25EFFECTIVE DATE.This section is effective the day following final enactment.

179.26    Sec. 2. Minnesota Statutes 2006, section 270C.56, subdivision 1, as amended by Laws
179.272008, chapter 154, article 15, section 7, is amended to read:
179.28    Subdivision 1. Liability imposed. A person who, either singly or jointly with
179.29others, has the control of, supervision of, or responsibility for filing returns or reports,
179.30paying taxes, or collecting or withholding and remitting taxes and who fails to do so, or a
179.31person who is liable under any other law, is liable for the payment of taxes, penalties, and
179.32interest arising under chapters 295, 296A, 297A, 297F, and 297G, or sections 256.9658,
179.33290.92 and 297E.02, and, for the taxes listed in this subdivision, the applicable penalties
179.34for nonpayment under section 289A.60.
179.35EFFECTIVE DATE.This section is effective for fees due after June 30, 2008.

180.1    Sec. 3. Minnesota Statutes 2006, section 295.50, subdivision 4, is amended to read:
180.2    Subd. 4. Health care provider. (a) "Health care provider" means:
180.3    (1) a person whose health care occupation is regulated or required to be regulated by
180.4the state of Minnesota furnishing any or all of the following goods or services directly to a
180.5patient or consumer: medical, surgical, optical, visual, dental, hearing, nursing services,
180.6drugs, laboratory, diagnostic or therapeutic services;
180.7    (2) a person who provides goods and services not listed in clause (1) that qualify for
180.8reimbursement under the medical assistance program provided under chapter 256B;
180.9    (3) a staff model health plan company;
180.10    (4) an ambulance service required to be licensed; or
180.11    (5) a person who sells or repairs hearing aids and related equipment or prescription
180.12eyewear.
180.13    (b) Health care provider does not include:
180.14    (1) hospitals; medical supplies distributors, except as specified under paragraph
180.15(a), clause (5); nursing homes licensed under chapter 144A or licensed in any other
180.16jurisdiction; wholesale drug distributors; pharmacies; surgical centers; bus and taxicab
180.17transportation, or any other providers of transportation services other than ambulance
180.18services required to be licensed; supervised living facilities for persons with developmental
180.19disabilities, licensed under Minnesota Rules, parts 4665.0100 to 4665.9900; housing
180.20with services establishments required to be registered under chapter 144D; board
180.21and lodging establishments providing only custodial services that are licensed under
180.22chapter 157 and registered under section 157.17 to provide supportive services or health
180.23supervision services; adult foster homes as defined in Minnesota Rules, part 9555.5105;
180.24day training and habilitation services for adults with developmental disabilities as defined
180.25in section 252.41, subdivision 3; boarding care homes, as defined in Minnesota Rules, part
180.264655.0100 ; and adult day care centers as defined in Minnesota Rules, part 9555.9600;
180.27    (2) home health agencies as defined in Minnesota Rules, part 9505.0175, subpart
180.2815; a person providing personal care services and supervision of personal care services
180.29as defined in Minnesota Rules, part 9505.0335; a person providing private duty nursing
180.30services as defined in Minnesota Rules, part 9505.0360; and home care providers required
180.31to be licensed under chapter 144A;
180.32    (3) a person who employs health care providers solely for the purpose of providing
180.33patient services to its employees; and
180.34    (4) an educational institution that employs health care providers solely for the
180.35purpose of providing patient services to its students if the institution does not receive fee
180.36for service payments or payments for extended coverage.; and
181.1    (5) a person who receives all payments for patient services from health care
181.2providers, surgical centers, or hospitals for goods and services that are taxable to the
181.3paying health care providers, surgical centers, or hospitals, as provided under section
181.4295.53, subdivision 1, clause (3) or (4), or from a source of funds that is exempt from tax
181.5under this chapter.
181.6EFFECTIVE DATE.Paragraph (b), clause (1) is effective the day following final
181.7enactment. Paragraph (b), clause (5) is effective for payments received after June 30, 2008.

181.8    Sec. 4. Minnesota Statutes 2006, section 295.52, subdivision 4, as amended by Laws
181.92008, chapter 154, article 14, section 5, is amended to read:
181.10    Subd. 4. Use tax; prescription drugs. (a) A person that receives prescription drugs
181.11for resale or use in Minnesota, other than from a wholesale drug distributor that is subject
181.12to tax under subdivision 3, is subject to a tax equal to the price paid to the wholesale drug
181.13distributor multiplied by the tax percentage specified in this section. When a person
181.14manufactures drugs that have not been subject to tax under subdivision 3, the person is
181.15subject to tax equal to the cost incurred by the person to manufacture the drugs multiplied
181.16by the tax percentage specified in this section. Liability for the tax is incurred when
181.17prescription drugs are received or delivered in Minnesota by the person.
181.18    (b) A tax imposed under this subdivision does not apply to purchases by an
181.19individual for personal consumption.
181.20EFFECTIVE DATE.This section is effective for drug purchases after June 30,
181.212008.

181.22    Sec. 5. Minnesota Statutes 2006, section 296A.07, subdivision 4, is amended to read:
181.23    Subd. 4. Exemptions. The provisions of subdivision 1 do not apply to gasoline or
181.24denatured ethanol purchased by:
181.25    (1) a transit system or transit provider receiving financial assistance or
181.26reimbursement under section 174.24, 256B.0625, subdivision 17, or 473.384; or
181.27    (2) an ambulance service licensed under chapter 144E; or
181.28    (3) a licensed distributor to be delivered to a terminal for use in blending.
181.29EFFECTIVE DATE.This section is effective the day following final enactment.

181.30    Sec. 6. Minnesota Statutes 2006, section 296A.08, subdivision 3, is amended to read:
181.31    Subd. 3. Exemptions. The provisions of subdivisions 1 and 2 do not apply to
181.32special fuel or alternative fuels purchased by:
182.1    (1) a transit system or transit provider receiving financial assistance or
182.2reimbursement under section 174.24, 256B.0625, subdivision 17, or 473.384; or
182.3    (2) an ambulance service licensed under chapter 144E; or
182.4    (3) a licensed distributor to be delivered to a terminal for use in blending.
182.5EFFECTIVE DATE.This section is effective the day following final enactment.

182.6    Sec. 7. Minnesota Statutes 2006, section 297F.21, subdivision 1, is amended to read:
182.7    Subdivision 1. Contraband defined. The following are declared to be contraband
182.8and therefore subject to civil and criminal penalties under this chapter:
182.9    (a) Cigarette packages which do not have stamps affixed to them as provided in this
182.10chapter, including but not limited to (i) packages with illegible stamps and packages with
182.11stamps that are not complete or whole even if the stamps are legible, and (ii) all devices
182.12for the vending of cigarettes in which packages as defined in item (i) are found, including
182.13all contents contained within the devices.
182.14    (b) A device for the vending of cigarettes and all packages of cigarettes, where the
182.15device does not afford at least partial visibility of contents. Where any package exposed
182.16to view does not carry the stamp required by this chapter, it shall be presumed that all
182.17packages contained in the device are unstamped and contraband.
182.18    (c) A device for the vending of cigarettes to which the commissioner or authorized
182.19agents have been denied access for the inspection of contents. In lieu of seizure, the
182.20commissioner or an agent may seal the device to prevent its use until inspection of
182.21contents is permitted.
182.22    (d) A device for the vending of cigarettes which does not carry the name and address
182.23of the owner, plainly marked and visible from the front of the machine.
182.24    (e) A device including, but not limited to, motor vehicles, trailers, snowmobiles,
182.25airplanes, and boats used with the knowledge of the owner or of a person operating with
182.26the consent of the owner for the storage or transportation of more than 5,000 cigarettes
182.27which are contraband under this subdivision. When cigarettes are being transported in
182.28the course of interstate commerce, or are in movement from either a public warehouse to
182.29a distributor upon orders from a manufacturer or distributor, or from one distributor to
182.30another, the cigarettes are not contraband, notwithstanding the provisions of clause (a).
182.31    (f) A device including, but not limited to, motor vehicles, trailers, snowmobiles,
182.32airplanes, and boats used with the knowledge of the owner, or of a person operating with
182.33the consent of the owner, for the storage or transportation of untaxed tobacco products
182.34intended for sale in Minnesota other than those in the possession of a licensed distributor
182.35on or before the due date for payment of the tax under section 297F.09, subdivision 2.
183.1    (g) Cigarette packages or tobacco products obtained from an unlicensed seller.
183.2    (h) Cigarette packages offered for sale or held as inventory in violation of section
183.3297F.20, subdivision 7 .
183.4    (i) Tobacco products on which the tax has not been paid by a licensed distributor.
183.5    (j) Any cigarette packages or tobacco products offered for sale or held as inventory
183.6for which there is not an invoice from a licensed seller as required under section 297F.13,
183.7subdivision 4 .
183.8    (k) Cigarette packages which have been imported into the United States in violation
183.9of United States Code, title 26, section 5754. All cigarettes held in violation of that section
183.10shall be presumed to have entered the United States after December 31, 1999, in the
183.11absence of proof to the contrary.
183.12    (l) Cigarettes and cigarette packaging which are not in compliance with fire safety
183.13requirements of sections 299F.850 to 299F.859.
183.14EFFECTIVE DATE.Property added in paragraph (l) of this section is contraband
183.15effective December 1, 2008.

183.16    Sec. 8. Minnesota Statutes 2006, section 297I.05, subdivision 12, is amended to read:
183.17    Subd. 12. Other entities. (a) A tax is imposed equal to two percent of:
183.18    (1) gross premiums less return premiums written for risks resident or located in
183.19Minnesota by a risk retention group;
183.20    (2) gross premiums less return premiums received by an attorney in fact acting
183.21in accordance with chapter 71A;
183.22    (3) gross premiums less return premiums received pursuant to assigned risk policies
183.23and contracts of coverage under chapter 79;
183.24    (4) the direct funded premium received by the reinsurance association under section
183.2579.34 from self-insurers approved under section 176.181 and political subdivisions that
183.26self-insure; and
183.27    (5) gross premiums less return premiums received by a nonprofit health service plan
183.28corporation authorized under chapter 62C; and
183.29    (6) (5) gross premiums less return premiums paid to an insurer other than a licensed
183.30insurance company or a surplus lines licensee for coverage of risks resident or located in
183.31Minnesota by a purchasing group or any members of the purchasing group to a broker or
183.32agent for the purchasing group.
183.33    (b) A tax is imposed on a joint self-insurance plan operating under chapter 60F. The
183.34rate of tax is equal to two percent of the total amount of claims paid during the fund year,
183.35with no deduction for claims wholly or partially reimbursed through stop-loss insurance.
184.1    (c) A tax is imposed on a joint self-insurance plan operating under chapter 62H.
184.2The rate of tax is equal to two percent of the total amount of claims paid during the
184.3fund's fiscal year, with no deduction for claims wholly or partially reimbursed through
184.4stop-loss insurance.
184.5    (d) A tax is imposed equal to the tax imposed under section 297I.05, subdivision 5,
184.6on the gross premiums less return premiums on all coverages received by an accountable
184.7provider network or agents of an accountable provider network in Minnesota, in cash or
184.8otherwise, during the year.
184.9EFFECTIVE DATE.This section is effective the day following final enactment.


184.12    Section 1. Minnesota Statutes 2006, section 13.51, subdivision 3, is amended to read:
184.13    Subd. 3. Data on income of individuals. Income information on individuals
184.14collected and maintained by political subdivisions to determine eligibility of property for
184.15class 4d under section 273.126 sections 273.128 and 273.13, is private data on individuals
184.16as defined in section 13.02, subdivision 12.
184.17EFFECTIVE DATE.This section is effective for data collected or maintained by
184.18political subdivisions beginning the day following final enactment.

184.19    Sec. 2. Minnesota Statutes 2006, section 13.585, subdivision 5, is amended to read:
184.20    Subd. 5. Private data on individuals. Income information on individuals collected
184.21and maintained by a housing agency to determine eligibility of property for class 4d
184.22under sections 273.126 273.128 and 273.13, is private data on individuals as defined in
184.23section 13.02, subdivision 12. The data may be disclosed to the county and local assessors
184.24responsible for determining eligibility of the property for classification 4d.
184.25EFFECTIVE DATE.This section is effective for data collected or maintained by a
184.26housing agency beginning the day following final enactment.

184.27    Sec. 3. Minnesota Statutes 2006, section 272.02, subdivision 38, is amended to read:
184.28    Subd. 38. Conversion to exempt or taxable uses. (a) Any property, except
184.29property taxed as personal property under section 273.125, that is exempt from taxation on
184.30January 2 of any year which, due to sale or other reason, loses its exemption prior to July 1
184.31of any year, shall be placed on the current assessment rolls for that year.
184.32    The valuation shall be determined with respect to its value on January 2 of such
184.33year. The classification shall be based upon the use to which the property was put by the
185.1purchaser, or in the event the purchaser has not utilized the property by July 1, the intended
185.2use of the property, determined by the county assessor, based upon all relevant facts.
185.3    (b) Property, except property taxed as personal property under section 273.125, that
185.4is subject to tax on January 2 that is acquired before July 1 of the year is exempt for that
185.5assessment year if the property is to be used for an exempt purpose under subdivisions 2
185.6to 8.
185.7    (c) Property which forfeits to the state for nonpayment of real estate taxes on or
185.8before December 31 in an assessment year, shall be removed from the assessment rolls for
185.9that assessment year. Forfeited property that is repurchased, or sold at a public or private
185.10sale, on or before December 31 of an assessment year shall be placed on the assessment
185.11rolls for that year's assessment.
185.12EFFECTIVE DATE.This section is effective the day following final enactment.

185.13    Sec. 4. Minnesota Statutes 2007 Supplement, section 273.1231, subdivision 7, is
185.14amended to read:
185.15    Subd. 7. Reassessed market value. "Reassessed market value" means the taxable
185.16market value of the property established for the January 2 assessment in the year that the
185.17disaster or destruction occurs, as adjusted by the county assessor or the commissioner of
185.18revenue to reflect the loss in market value caused by the damage. As soon as practical, the
185.19assessor or commissioner shall report the reassessed value to the county auditor.
185.20EFFECTIVE DATE.This section is effective the day following final enactment.

185.21    Sec. 5. Minnesota Statutes 2007 Supplement, section 273.1231, is amended by adding
185.22a subdivision to read:
185.23    Subd. 8. Utility property. "Utility property" means property appraised and
185.24classified for tax purposes by the commissioner of revenue under sections 273.33 to
185.25273.3711.
185.26EFFECTIVE DATE.This section is effective the day following final enactment.

185.27    Sec. 6. Minnesota Statutes 2007 Supplement, section 273.1232, subdivision 1, is
185.28amended to read:
185.29    Subdivision 1. Reassessments required. For the purposes of sections 273.1231
185.30to 273.1235, the county assessor must reassess all damaged property in a disaster or
185.31emergency area, and the county assessor or except that the commissioner of revenue
185.32as appropriate shall reassess all property for which an application is submitted to the
186.1commissioner under section 273.1233 or 273.1235. As soon as practical, the assessor or
186.2commissioner of revenue must report the reassessed value to the county auditor.
186.3EFFECTIVE DATE.This section is effective the day following final enactment.

186.4    Sec. 7. Minnesota Statutes 2007 Supplement, section 273.1233, subdivision 1, is
186.5amended to read:
186.6    Subdivision 1. Abatement authorization. (a) Notwithstanding section 375.192,
186.7a county board may grant an abatement of net tax for homestead and nonhomestead
186.8property under the provisions of this paragraph for taxes payable in the year in which
186.9the destruction occurs if:
186.10    (1) the owner submits a written application to the county assessor as soon as
186.11practical after the damage has occurred;
186.12    (2) the owner submits a written application to the county board as soon as practical
186.13after the damage has occurred; and
186.14    (3) the county assessor determines that 50 percent or more of a homestead dwelling
186.15or other building has been (i) unintentionally or accidentally destroyed, or (ii) destroyed
186.16by arson or vandalism by someone other than the owner.
186.17    Abatements granted under this paragraph are not subject to approval by the
186.18commissioner of revenue.
186.19    (b) Notwithstanding sections 270C.86 and 375.192, the commissioner of revenue
186.20may grant an abatement of net tax for utility property that the commissioner is required by
186.21law to appraise for taxes payable in the year in which the destruction occurs if:
186.22    (1) the owner submits a written application to the commissioner as soon as practical
186.23after the damage has occurred;
186.24    (2) the owner forwards a copy of the written application to the county board as soon
186.25as practical after the damage has occurred; and
186.26    (3) the commissioner determines that 50 percent or more of the property has been
186.27(i) unintentionally or accidentally destroyed, or (ii) destroyed by arson or vandalism by
186.28someone other than the owner.
186.29    Abatements granted under this paragraph are not subject to approval by the county
186.30board of the county where the property is located.
186.31EFFECTIVE DATE.This section is effective the day following final enactment.

186.32    Sec. 8. Minnesota Statutes 2007 Supplement, section 273.1233, subdivision 3, is
186.33amended to read:
187.1    Subd. 3. Reimbursement, levy, and appropriation. (a) If the destruction occurs as
187.2a result of a disaster or emergency and the property is located in a disaster or emergency
187.3area, the county auditor shall certify the abatements granted under this section to the
187.4commissioner of revenue for reimbursement to each taxing jurisdiction in which the
187.5damaged property is located. The commissioner shall make the payments to the taxing
187.6jurisdictions containing the property, other than school districts and the state, at the time
187.7distributions are made under section 473H.10, subdivision 3. Reimbursements to school
187.8districts shall be made as provided in section 273.1392. No reimbursement is to be paid
187.9to the state treasury.
187.10    (b) Local taxing authorities may levy in the following year the amount of
187.11unreimbursed tax dollars lost as a result of the reductions granted pursuant to this
187.12subdivision section and sections 273.1234 and 273.1235 outside of any statutory
187.13restriction as to levy amount or tax rate.
187.14    (c) There is annually appropriated from the general fund to the commissioner of
187.15revenue an amount necessary to make the payments required by this section.
187.16EFFECTIVE DATE.This section is effective the day following final enactment.

187.17    Sec. 9. Minnesota Statutes 2007 Supplement, section 273.1234, is amended to read:
187.18273.1234 TAX RELIEF FOR DESTROYED PROPERTY; HOMESTEAD
187.19AND DISASTER CREDITS.
187.20    Subdivision 1. Credit provided. The county auditor shall compute a credit for taxes
187.21payable in the year following the year in which the damage or destruction occurred for
187.22each reassessed homestead property within the county that is located within a disaster
187.23or emergency area. The credit is equal to the difference in the net tax on the property
187.24computed using the market value of the property established for the January 2 assessment
187.25in the year in which the damage occurred and as computed using the reassessed value.
187.26    Subd. 2. Credit reimbursements. The county auditor shall certify the credits
187.27granted under this section to the commissioner of revenue for reimbursement to each
187.28taxing jurisdiction in which the damaged property is located. The commissioner shall
187.29make the payments to the taxing jurisdictions containing the property, other than
187.30school districts and the state, at the time distributions are made under section 473H.10,
187.31subdivision 3. Reimbursements to school districts shall be made as provided in section
187.32273.1392 . No reimbursement is to be paid to the state treasury.
187.33    Subd. 3. Appropriation. There is annually appropriated from the general fund
187.34to the commissioner of revenue an amount necessary to make the payments required
187.35by this section.
188.1EFFECTIVE DATE.This section is effective the day following final enactment.

188.2    Sec. 10. Minnesota Statutes 2007 Supplement, section 273.1235, subdivision 1,
188.3is amended to read:
188.4    Subdivision 1. Credit provided. The county board may grant a credit for taxes
188.5payable in the year following the year in which the damage or destruction occurred
188.6for: (1) homestead properties property that meets all the requirements under section
188.7273.1233, subdivision 1, paragraph (a), but that do does not qualify for a credit under
188.8section 273.1234, except that an application need only be submitted by the end of the
188.9year in which the damage occurred; and (2) nonhomestead and utility property meeting
188.10the requirements that meets all the requirements under section 273.1233, subdivision 1,
188.11paragraph (b), except that an application need only be submitted by the end of the year
188.12in which the damage occurred.
188.13EFFECTIVE DATE.This section is effective the day following final enactment.

188.14    Sec. 11. Minnesota Statutes 2007 Supplement, section 273.1235, subdivision 3,
188.15is amended to read:
188.16    Subd. 3. Credit reimbursements. The county auditor shall certify the credits
188.17granted under this section for property within a disaster or emergency area to the
188.18commissioner of revenue for reimbursement to each taxing jurisdiction in which the
188.19damaged property is located. The commissioner shall make the payments to the taxing
188.20jurisdictions containing the property, other than school districts and the state, at the time
188.21distributions are made under section 473H.10, subdivision 3. Reimbursements to school
188.22districts shall be made as provided in section 273.1392. No reimbursement is to be paid
188.23to the state treasury. No reimbursement is to be made for credits to property not located
188.24in a disaster or emergency area.
188.25EFFECTIVE DATE.This section is effective the day following final enactment.

188.26    Sec. 12. Minnesota Statutes 2006, section 273.124, subdivision 13, as amended by
188.27Laws 2008, chapter 154, article 13, section 29, is amended to read:
188.28    Subd. 13. Homestead application. (a) A person who meets the homestead
188.29requirements under subdivision 1 must file a homestead application with the county
188.30assessor to initially obtain homestead classification.
188.31    (b) The format and contents of a uniform homestead application shall be prescribed
188.32by the commissioner of revenue. The application must clearly inform the taxpayer that
188.33this application must be signed by all owners who occupy the property or by the qualifying
189.1relative and returned to the county assessor in order for the property to receive homestead
189.2treatment.
189.3    (c) Every property owner applying for homestead classification must furnish to the
189.4county assessor the Social Security number of each occupant who is listed as an owner
189.5of the property on the deed of record, the name and address of each owner who does not
189.6occupy the property, and the name and Social Security number of each owner's spouse who
189.7occupies the property. The application must be signed by each owner who occupies the
189.8property and by each owner's spouse who occupies the property, or, in the case of property
189.9that qualifies as a homestead under subdivision 1, paragraph (c), by the qualifying relative.
189.10    If a property owner occupies a homestead, the property owner's spouse may not
189.11claim another property as a homestead unless the property owner and the property owner's
189.12spouse file with the assessor an affidavit or other proof required by the assessor stating that
189.13the property qualifies as a homestead under subdivision 1, paragraph (e).
189.14    Owners or spouses occupying residences owned by their spouses and previously
189.15occupied with the other spouse, either of whom fail to include the other spouse's name
189.16and Social Security number on the homestead application or provide the affidavits or
189.17other proof requested, will be deemed to have elected to receive only partial homestead
189.18treatment of their residence. The remainder of the residence will be classified as
189.19nonhomestead residential. When an owner or spouse's name and Social Security number
189.20appear on homestead applications for two separate residences and only one application is
189.21signed, the owner or spouse will be deemed to have elected to homestead the residence for
189.22which the application was signed.
189.23    The Social Security numbers, state or federal tax returns or tax return information,
189.24including the federal income tax schedule F required by this section, or affidavits or other
189.25proofs of the property owners and spouses, and the federal income tax schedule F required
189.26by this section, submitted under this or another section to support a claim for a property
189.27tax homestead classification are private data on individuals as defined by section 13.02,
189.28subdivision 12 , but, notwithstanding that section, the private data may be disclosed to the
189.29commissioner of revenue, or, for purposes of proceeding under the Revenue Recapture
189.30Act to recover personal property taxes owing, to the county treasurer.
189.31    (d) If residential real estate is occupied and used for purposes of a homestead by a
189.32relative of the owner and qualifies for a homestead under subdivision 1, paragraph (c), in
189.33order for the property to receive homestead status, a homestead application must be filed
189.34with the assessor. The Social Security number of each relative and spouse of a relative
189.35occupying the property shall be required on the homestead application filed under this
189.36subdivision. If a different relative of the owner subsequently occupies the property, the
190.1owner of the property must notify the assessor within 30 days of the change in occupancy.
190.2The Social Security number of a relative or relative's spouse occupying the property
190.3is private data on individuals as defined by section 13.02, subdivision 12, but may be
190.4disclosed to the commissioner of revenue, or, for the purposes of proceeding under the
190.5Revenue Recapture Act to recover personal property taxes owing, to the county treasurer.
190.6    (e) The homestead application shall also notify the property owners that the
190.7application filed under this section will not be mailed annually and that if the property
190.8is granted homestead status for any assessment year, that same property shall remain
190.9classified as homestead until the property is sold or transferred to another person, or
190.10the owners, the spouse of the owner, or the relatives no longer use the property as their
190.11homestead. Upon the sale or transfer of the homestead property, a certificate of value must
190.12be timely filed with the county auditor as provided under section 272.115. Failure to
190.13notify the assessor within 30 days that the property has been sold, transferred, or that the
190.14owner, the spouse of the owner, or the relative is no longer occupying the property as a
190.15homestead, shall result in the penalty provided under this subdivision and the property
190.16will lose its current homestead status.
190.17    (f) If the homestead application is not returned within 30 days, the county will send a
190.18second application to the present owners of record. The notice of proposed property taxes
190.19prepared under section 275.065, subdivision 3, shall reflect the property's classification. If
190.20a homestead application has not been filed with the county by December 15, the assessor
190.21shall classify the property as nonhomestead for the current assessment year for taxes
190.22payable in the following year, provided that the owner may be entitled to receive the
190.23homestead classification by proper application under section 375.192.
190.24    (g) At the request of the commissioner, each county must give the commissioner a
190.25list that includes the name and Social Security number of each occupant of homestead
190.26property who is the property owner, property owner's spouse, qualifying relative of a
190.27property owner, or a spouse of a qualifying relative. The commissioner shall use the
190.28information provided on the lists as appropriate under the law, including for the detection
190.29of improper claims by owners, or relatives of owners, under chapter 290A.
190.30    (h) If the commissioner finds that a property owner may be claiming a fraudulent
190.31homestead, the commissioner shall notify the appropriate counties. Within 90 days of
190.32the notification, the county assessor shall investigate to determine if the homestead
190.33classification was properly claimed. If the property owner does not qualify, the county
190.34assessor shall notify the county auditor who will determine the amount of homestead
190.35benefits that had been improperly allowed. For the purpose of this section, "homestead
190.36benefits" means the tax reduction resulting from the classification as a homestead under
191.1section 273.13, the taconite homestead credit under section 273.135, the residential
191.2homestead and agricultural homestead credits under section 273.1384, and the
191.3supplemental homestead credit under section 273.1391.
191.4    The county auditor shall send a notice to the person who owned the affected property
191.5at the time the homestead application related to the improper homestead was filed,
191.6demanding reimbursement of the homestead benefits plus a penalty equal to 100 percent
191.7of the homestead benefits. The person notified may appeal the county's determination
191.8by serving copies of a petition for review with county officials as provided in section
191.9278.01 and filing proof of service as provided in section 278.01 with the Minnesota Tax
191.10Court within 60 days of the date of the notice from the county. Procedurally, the appeal
191.11is governed by the provisions in chapter 271 which apply to the appeal of a property tax
191.12assessment or levy, but without requiring any prepayment of the amount in controversy. If
191.13the amount of homestead benefits and penalty is not paid within 60 days, and if no appeal
191.14has been filed, the county auditor shall certify the amount of taxes and penalty to the county
191.15treasurer. The county treasurer will add interest to the unpaid homestead benefits and
191.16penalty amounts at the rate provided in section 279.03 for real property taxes becoming
191.17delinquent in the calendar year during which the amount remains unpaid. Interest may be
191.18assessed for the period beginning 60 days after demand for payment was made.
191.19    If the person notified is the current owner of the property, the treasurer may add the
191.20total amount of homestead benefits, penalty, interest, and costs to the ad valorem taxes
191.21otherwise payable on the property by including the amounts on the property tax statements
191.22under section 276.04, subdivision 3. The amounts added under this paragraph to the ad
191.23valorem taxes shall include interest accrued through December 31 of the year preceding
191.24the taxes payable year for which the amounts are first added. These amounts, when added
191.25to the property tax statement, become subject to all the laws for the enforcement of real or
191.26personal property taxes for that year, and for any subsequent year.
191.27    If the person notified is not the current owner of the property, the treasurer may
191.28collect the amounts due under the Revenue Recapture Act in chapter 270A, or use any of
191.29the powers granted in sections 277.20 and 277.21 without exclusion, to enforce payment
191.30of the homestead benefits, penalty, interest, and costs, as if those amounts were delinquent
191.31tax obligations of the person who owned the property at the time the application related
191.32to the improperly allowed homestead was filed. The treasurer may relieve a prior owner
191.33of personal liability for the homestead benefits, penalty, interest, and costs, and instead
191.34extend those amounts on the tax lists against the property as provided in this paragraph
191.35to the extent that the current owner agrees in writing. On all demands, billings, property
191.36tax statements, and related correspondence, the county must list and state separately the
192.1amounts of homestead benefits, penalty, interest and costs being demanded, billed or
192.2assessed.
192.3    (i) Any amount of homestead benefits recovered by the county from the property
192.4owner shall be distributed to the county, city or town, and school district where the
192.5property is located in the same proportion that each taxing district's levy was to the total
192.6of the three taxing districts' levy for the current year. Any amount recovered attributable
192.7to taconite homestead credit shall be transmitted to the St. Louis County auditor to be
192.8deposited in the taconite property tax relief account. Any amount recovered that is
192.9attributable to supplemental homestead credit is to be transmitted to the commissioner of
192.10revenue for deposit in the general fund of the state treasury. The total amount of penalty
192.11collected must be deposited in the county general fund.
192.12    (j) If a property owner has applied for more than one homestead and the county
192.13assessors cannot determine which property should be classified as homestead, the county
192.14assessors will refer the information to the commissioner. The commissioner shall make
192.15the determination and notify the counties within 60 days.
192.16    (k) In addition to lists of homestead properties, the commissioner may ask the
192.17counties to furnish lists of all properties and the record owners. The Social Security
192.18numbers and federal identification numbers that are maintained by a county or city
192.19assessor for property tax administration purposes, and that may appear on the lists retain
192.20their classification as private or nonpublic data; but may be viewed, accessed, and used by
192.21the county auditor or treasurer of the same county for the limited purpose of assisting the
192.22commissioner in the preparation of microdata samples under section 270C.12.
192.23    (l) On or before April 30 each year beginning in 2007, each county must provide the
192.24commissioner with the following data for each parcel of homestead property by electronic
192.25means as defined in section 289A.02, subdivision 8:
192.26    (i) the property identification number assigned to the parcel for purposes of taxes
192.27payable in the current year;
192.28    (ii) the name and Social Security number of each occupant of homestead property
192.29who is the property owner, property owner's spouse, qualifying relative of a property
192.30owner, or spouse of a qualifying relative;
192.31    (iii) the classification of the property under section 273.13 for taxes payable in the
192.32current year and in the prior year;
192.33    (iv) an indication of whether the property was classified as a homestead for taxes
192.34payable in the current year because of occupancy by a relative of the owner or by a
192.35spouse of a relative;
193.1    (v) the property taxes payable as defined in section 290A.03, subdivision 13, for the
193.2current year and the prior year;
193.3    (vi) the market value of improvements to the property first assessed for tax purposes
193.4for taxes payable in the current year;
193.5    (vii) the assessor's estimated market value assigned to the property for taxes payable
193.6in the current year and the prior year;
193.7    (viii) the taxable market value assigned to the property for taxes payable in the
193.8current year and the prior year;
193.9    (ix) whether there are delinquent property taxes owing on the homestead;
193.10    (x) the unique taxing district in which the property is located; and
193.11    (xi) such other information as the commissioner decides is necessary.
193.12    The commissioner shall use the information provided on the lists as appropriate
193.13under the law, including for the detection of improper claims by owners, or relatives
193.14of owners, under chapter 290A.
193.15EFFECTIVE DATE.This section is effective the day following final enactment.

193.16    Sec. 13. Minnesota Statutes 2006, section 273.124, subdivision 21, is amended to read:
193.17    Subd. 21. Trust property; homestead. Real property held by a trustee under a trust
193.18is eligible for classification as homestead property if:
193.19    (1) the grantor or surviving spouse of the grantor of the trust occupies and uses the
193.20property as a homestead;
193.21    (2) a relative or surviving relative of the grantor who meets the requirements of
193.22subdivision 1, paragraph (c), in the case of residential real estate; or subdivision 1,
193.23paragraph (d), in the case of agricultural property, occupies and uses the property as
193.24a homestead;
193.25    (3) a family farm corporation, joint farm venture, limited liability company, or
193.26partnership operating a family farm in which the grantor or the grantor's surviving spouse
193.27is a shareholder, member, or partner rents the property held by a trustee under a trust, and
193.28the grantor, the spouse of the grantor, or the son or daughter of the grantor, who is also a
193.29shareholder, member, or partner of the corporation, joint farm venture, limited liability
193.30company, or partnership occupies and uses the property as a homestead, or is actively
193.31farming the property on behalf of the corporation, joint farm venture, limited liability
193.32company, or partnership; or
193.33    (4) a person who has received homestead classification for property taxes payable in
193.342000 on the basis of an unqualified legal right under the terms of the trust agreement to
193.35occupy the property as that person's homestead and who continues to use the property as
194.1a homestead or a person who received the homestead classification for taxes payable in
194.22005 under clause (3) who does not qualify under clause (3) for taxes payable in 2006
194.3or thereafter but who continues to qualify under clause (3) as it existed for taxes payable
194.4in 2005.
194.5    For purposes of this subdivision, "grantor" is defined as the person creating or
194.6establishing a testamentary, inter Vivos, revocable or irrevocable trust by written
194.7instrument or through the exercise of a power of appointment.
194.8EFFECTIVE DATE.This section is effective the day following final enactment.

194.9    Sec. 14. Minnesota Statutes 2006, section 273.13, subdivision 34, as added by Laws
194.102008, chapter 154, article 2, section 14, is amended to read:
194.11    Subd. 34. Homestead of disabled veteran. (a) All or a portion of the market
194.12value of property owned by a veteran or by the veteran and their spouse, qualifying
194.13for homestead classification under subdivision 22 or 23 is excluded in determining the
194.14property's taxable market value if it serves as the homestead of a military veteran, as
194.15defined in section 197.447, who has a service-connected disability of 70 percent or more.
194.16To qualify for exclusion under this subdivision, the veteran must have been honorably
194.17discharged from the United States armed forces, as indicated by United States Government
194.18Form DD214 or other official military discharge papers, and must be certified by the
194.19United States Veterans Administration as having a service-connected disability.
194.20    (b)(1) For a disability rating of 70 percent or more, $150,000 of market value is
194.21excluded, except as provided in clause (2); and
194.22    (2) for a total (100 percent) and permanent disability, $300,000 of market value is
194.23excluded.
194.24    (c) If a disabled veteran qualifying for a valuation exclusion under paragraph (b),
194.25clause (2), predeceases the veteran's spouse, and if upon the death of the veteran the
194.26spouse holds the legal or beneficial title to the homestead and permanently resides there,
194.27the exclusion shall carry over to the benefit of the veteran's spouse until such time as
194.28the spouse sells, transfers, or otherwise disposes of the property. The benefits granted
194.29under this section for the property of a surviving spouse also apply to property that
194.30received surviving-spouse benefits under subdivision 22, paragraph (b), clause (2), for
194.31taxes payable in 2008.
194.32    (d) In the case of an agricultural homestead, only the portion of the property
194.33consisting of the house and garage and immediately surrounding one acre of land qualifies
194.34for the valuation exclusion under this subdivision.
195.1    (e) A property qualifying for a valuation exclusion under this subdivision is not
195.2eligible for the credit under section 273.1384, subdivision 1, or classification under
195.3subdivision 22, paragraph (b).
195.4    (f) To qualify for a valuation exclusion under this subdivision a property owner must
195.5apply to the assessor by July 1 of each assessment year, except that an annual reapplication
195.6is not required once a property has been accepted for a valuation exclusion under paragraph
195.7(b), clause (2), and the property continues to qualify until there is a change in ownership.
195.8EFFECTIVE DATE.This section is effective for assessment year 2008 and
195.9thereafter, for taxes payable in 2009 and thereafter, except that the application date in
195.10paragraph (f) for the 2008 assessment year is extended to September 1, 2008.

195.11    Sec. 15. Minnesota Statutes 2006, section 274.01, subdivision 3, is amended to read:
195.12    Subd. 3. Local board duties transferred to county. The town board of any town
195.13or the governing body of any home rule charter or statutory city may transfer its powers
195.14and duties under subdivision 1 to the county board, and no longer perform the function
195.15of a local board. Before the town board or the governing body of a city transfers the
195.16powers and duties to the county board, the town board or city's governing body shall give
195.17public notice of the meeting at which the proposal for transfer is to be considered. The
195.18public notice shall follow the procedure contained in section 13D.04, subdivision 2. A
195.19transfer of duties as permitted under this subdivision must be communicated to the county
195.20assessor, in writing, before December 1 of any year to be effective for the following
195.21year's assessment. This transfer of duties to the county may either be permanent or for a
195.22specified number of years, provided that the transfer cannot be for less than three years.
195.23Its length must be stated in writing. A town or city may renew its option to transfer. The
195.24option to transfer duties under this subdivision is only available to a town or city whose
195.25assessment is done by the county.
195.26EFFECTIVE DATE.This section is effective the day following final enactment.

195.27    Sec. 16. Minnesota Statutes 2006, section 274.014, subdivision 3, is amended to read:
195.28    Subd. 3. Proof of compliance; transfer of duties. (a) Any city or town that
195.29conducts local boards of appeal and equalization meetings must provide proof to the
195.30county assessor by December 1, 2006, and each year thereafter, that it is in compliance
195.31with the requirements of subdivision 2. Beginning in 2006, this notice must also verify
195.32that there was a quorum of voting members at each meeting of the board of appeal
195.33and equalization in the current year. A city or town that does not comply with these
195.34requirements is deemed to have transferred its board of appeal and equalization powers
196.1to the county beginning with the following year's assessment and continuing unless the
196.2powers are reinstated under paragraph (c).
196.3    (b) The county shall notify the taxpayers when the board of appeal and equalization
196.4for a city or town has been transferred to the county under this subdivision and, prior to
196.5the meeting time of the county board of equalization, the county shall make available to
196.6those taxpayers a procedure for a review of the assessments, including, but not limited to,
196.7open book meetings. This alternate review process shall take place in April and May.
196.8    (c) A local board whose powers are transferred to the county under this subdivision
196.9may be reinstated by resolution of the governing body of the city or town and upon proof
196.10of compliance with the requirements of subdivision 2. The resolution and proofs must be
196.11provided to the county assessor by December 1 in order to be effective for the following
196.12year's assessment.
196.13    (d) A local board whose powers are transferred to the county under this subdivision
196.14may continue to employ a local assessor and is not deemed to have transferred its powers
196.15to make assessments.
196.16EFFECTIVE DATE.This section is effective the day following final enactment.

196.17    Sec. 17. Minnesota Statutes 2006, section 290B.04, subdivision 1, is amended to read:
196.18    Subdivision 1. Initial application. (a) A taxpayer meeting the program
196.19qualifications under section 290B.03 may apply to the commissioner of revenue for the
196.20deferral of taxes. Applications are due on or before July 1 for deferral of any of the
196.21following year's property taxes. A taxpayer may apply in the year in which the taxpayer
196.22becomes 65 years old, provided that no deferral of property taxes will be made until the
196.23calendar year after the taxpayer becomes 65 years old. The application, which shall be
196.24prescribed by the commissioner of revenue, shall include the following items and any
196.25other information which the commissioner deems necessary:
196.26    (1) the name, address, and Social Security number of the owner or owners;
196.27    (2) a copy of the property tax statement for the current payable year for the
196.28homesteaded property;
196.29    (3) the initial year of ownership and occupancy as a homestead;
196.30    (4) the owner's household income for the previous calendar year; and
196.31    (5) information on any mortgage loans or other amounts secured by mortgages or
196.32other liens against the property, for which purpose the commissioner may require the
196.33applicant to provide a copy of the mortgage note, the mortgage, or a statement of the
196.34balance owing on the mortgage loan provided by the mortgage holder. The commissioner
197.1may require the appropriate documents in connection with obtaining and confirming
197.2information on unpaid amounts secured by other liens.
197.3    The application must state that program participation is voluntary. The application
197.4must also state that the deferred amount depends directly on the applicant's household
197.5income, and that program participation includes authorization for the annual deferred
197.6amount, the cumulative deferral and interest that appear on each year's notice prepared by
197.7the county under subdivision 6, is public data.
197.8    The application must state that program participants may claim the property tax
197.9refund based on the full amount of property taxes eligible for the refund, including any
197.10deferred amounts. The application must also state that property tax refunds will be used to
197.11offset any deferral and interest under this program, and that any other amounts subject to
197.12revenue recapture under section 270A.03, subdivision 7, will also be used to offset any
197.13deferral and interest under this program.
197.14    (b) As part of the initial application process, the commissioner may require the
197.15applicant to obtain at the applicant's own cost and submit:
197.16    (1) if the property is registered property under chapter 508 or 508A, a copy of the
197.17original certificate of title in the possession of the county registrar of titles (sometimes
197.18referred to as "condition of register"); or
197.19    (2) if the property is abstract property, a report prepared by a licensed abstracter
197.20showing the last deed and any unsatisfied mortgages, liens, judgments, and state and
197.21federal tax lien notices which were recorded on or after the date of that last deed with
197.22respect to the property or to the applicant.
197.23    The certificate or report under clauses (1) and (2) need not include references to
197.24any documents filed or recorded more than 40 years prior to the date of the certification
197.25or report. The certification or report must be as of a date not more than 30 days prior
197.26to submission of the application.
197.27    The commissioner may also require the county recorder or county registrar of the
197.28county where the property is located to provide copies of recorded documents related to
197.29the applicant or the property, for which the recorder or registrar shall not charge a fee. The
197.30commissioner may use any information available to determine or verify eligibility under
197.31this section. The household income from the application is private data on individuals as
197.32defined in section 13.02, subdivision 12.
197.33EFFECTIVE DATE.This section is effective for data collected or maintained by
197.34the commissioner of revenue beginning the day following final enactment.

197.35    Sec. 18. Minnesota Statutes 2006, section 469.040, subdivision 4, is amended to read:
198.1    Subd. 4. Facilities funded from multiple sources. In the metropolitan area, as
198.2defined in section 473.121, subdivision 2, the tax treatment provided in subdivision 3
198.3applies to that portion of any multifamily rental housing facility represented by the ratio of
198.4(1) the number of units in the facility that are subject to the requirements of Section 5 of
198.5the United States Housing Act of 1937, as the result of the implementation of a federal
198.6court order or consent decree to (2) the total number of units within the facility.
198.7    The housing and redevelopment authority for the city in which the facility is located,
198.8any public entity exercising the powers of such housing and redevelopment authority, or
198.9the county housing and redevelopment authority for the county in which the facility is
198.10located, shall annually certify to the assessor responsible for assessing the facility, at the
198.11time and in the manner required by the assessor, the number of units in the facility that are
198.12subject to the requirements of Section 5 of the United States Housing Act of 1937.
198.13    Nothing in this subdivision shall prevent that portion of the facility not subject to
198.14this subdivision from meeting the requirements of section 273.126 273.128, and for that
198.15purpose the total number of units in the facility must be taken into account.
198.16EFFECTIVE DATE.This section is effective retroactively for taxes payable in
198.172006 and thereafter.

198.18    Sec. 19. Minnesota Statutes 2006, section 469.174, subdivision 10b, is amended to
198.19read:
198.20    Subd. 10b. Qualified disaster area. A "qualified disaster area" is an area that
198.21meets the following requirements:
198.22    (1) parcels consisting of 70 percent of the area of the district were occupied by
198.23buildings, streets, utilities, paved or gravel parking lots, or other similar structures
198.24immediately before the disaster or emergency;
198.25    (2) the area of the district was subject to a disaster or emergency, as defined in
198.26section 273.123, subdivision 1 273.1231, subdivision 2, within the 18-month period
198.27ending on the day the request for certification of the district is made; and
198.28    (3) 50 percent or more of the buildings in the area have suffered substantial damage
198.29as a result of the disaster or emergency.
198.30EFFECTIVE DATE.This section is effective the day following final enactment.

198.31    Sec. 20. Minnesota Statutes 2006, section 469.177, subdivision 1c, is amended to read:
198.32    Subd. 1c. Original net tax capacity adjustments; presidential disaster area. (a)
198.33The provisions of this subdivision apply to a district located in a disaster area, as described
198.34in section 273.123, subdivision 1, paragraph (b) 273.1231, subdivision 3, paragraph (a),
199.1clause (1), and are effective for taxes payable in the first calendar year beginning at least
199.2four months after the date of the determination.
199.3    (b) For a district certified before the date of the disaster area determination as
199.4provided in section 273.123, subdivision 1, paragraph (b) 273.1231, subdivision 3,
199.5paragraph (a), clause (1), upon the request of the municipality, the county auditor shall
199.6reduce the original net tax capacity of the district by the reduction in the net tax capacity
199.7of properties in the district that is attributable to the physical effects of the disaster, but not
199.8below zero. The assessor shall determine the amount of the reduction in market value that
199.9is attributable to the physical effects of the disaster to be used by the county auditor in
199.10computing the reduction in net tax capacity.
199.11    (c) For a district that does not qualify under paragraph (b) and for which the request
199.12for certification is made in the same calendar year as the disaster area determination,
199.13upon the request of the municipality, the assessor shall determine the reduction in market
199.14value of properties in the district that is attributable to the physical effects of the disaster.
199.15The county auditor shall use the reduced market value in certifying the original net tax
199.16capacity of the district.
199.17EFFECTIVE DATE.This section is effective the day following final enactment.


199.20    Section 1. Minnesota Statutes 2006, section 16D.02, subdivision 3, is amended to read:
199.21    Subd. 3. Debt. "Debt" means an amount owed to the state directly, or through a
199.22state agency, on account of a fee, duty, lease, direct loan, loan insured or guaranteed by
199.23the state, rent, service, sale of real or personal property, overpayment, fine, assessment,
199.24penalty, restitution, damages, interest, tax, bail bond, forfeiture, reimbursement, liability
199.25owed, an assignment to the state including assignments under section 256.741, the Social
199.26Security Act, or other state or federal law, recovery of costs incurred by the state, or any
199.27other source of indebtedness to the state. Debt also includes amounts owed to individuals
199.28as a result of civil, criminal, or administrative action brought by the state or a state agency
199.29pursuant to its statutory authority or for which the state or state agency acts in a fiduciary
199.30capacity in providing collection services in accordance with the regulations adopted under
199.31the Social Security Act at Code of Federal Regulations, title 45, section 302.33. When the
199.32commissioner provides collection services pursuant to a debt qualification plan, debt also
199.33includes an amount owed to the courts, local government units, Minnesota state colleges
199.34and universities governed by the Board of Trustees of the Minnesota State Colleges and
200.1Universities, or University of Minnesota for which the commissioner provides collection
200.2services pursuant to contract.
200.3EFFECTIVE DATE.This section is effective the day following final enactment.

200.4    Sec. 2. Minnesota Statutes 2006, section 16D.02, subdivision 6, is amended to read:
200.5    Subd. 6. Referring agency. "Referring agency" means a state agency, local
200.6government unit, Minnesota state colleges and universities governed by the Board of
200.7Trustees of the Minnesota State Colleges and Universities, University of Minnesota, or
200.8a court, that has entered into a debt qualification plan with the commissioner to refer
200.9debts to the commissioner for collection.
200.10EFFECTIVE DATE.This section is effective the day following final enactment.

200.11    Sec. 3. Minnesota Statutes 2006, section 16D.04, subdivision 2, as amended by Laws
200.122008, chapter 154, article 15, section 2, is amended to read:
200.13    Subd. 2. Agency participation. (a) A referring agency must refer, by electronic
200.14means, debts to the commissioner for collection. Responsibility for the debt, including the
200.15reporting of the debt to the commissioner of finance and the decision with regard to the
200.16continuing collection and uncollectibility of the debt, remains with the referring agency.
200.17 Decisions with regard to continuing collection and the uncollectibility of referred debts
200.18shall be made by the commissioner who shall then notify the commissioner of finance and
200.19the referring agency. A decision by the commissioner that a referred debt is uncollectible
200.20does not prevent the referring agency from taking additional collection action.
200.21    (b) Before a debt becomes 121 days past due, a referring agency may refer the
200.22debt to the commissioner for collection at any time after a debt becomes delinquent and
200.23uncontested and the debtor has no further administrative appeal of the amount of the debt.
200.24When a debt owed to a referring agency becomes 121 days past due, the referring agency
200.25must refer the debt to the commissioner for collection. This requirement does not apply if
200.26there is a dispute over the amount or validity of the debt, if the debt is the subject of legal
200.27action or administrative proceedings, or the agency determines that the debtor is adhering
200.28to acceptable payment arrangements. The commissioner may provide that certain types of
200.29debt need not be referred to the commissioner for collection under this paragraph. Methods
200.30and procedures for referral must follow internal guidelines prepared by the commissioner.
200.31    (c) If the referring agency is a court, the court must furnish a debtor's Social Security
200.32number to the commissioner when the court refers the debt.
200.33EFFECTIVE DATE.This section is effective for debts referred after December
200.3431, 2008.

201.1    Sec. 4. Minnesota Statutes 2006, section 270A.08, subdivision 1, is amended to read:
201.2    Subdivision 1. Notice to debtor. (a) Not later than five days after the claimant
201.3agency has sent notification to the department pursuant to section 270A.07, subdivision 1,
201.4the claimant agency shall send a written notification to the debtor asserting the right of the
201.5claimant agency to the refund or any part thereof. If the notice is returned to the claimant
201.6agency as undeliverable, or the claimant agency has reason to believe the debtor did not
201.7receive the notice, the claimant agency shall obtain the current last known address of the
201.8debtor from the commissioner and resend the corrected notice.
201.9    (b) If a debt has been referred to the commissioner for collection under chapter 16D
201.10and the referring agency meets the definition of claimant agency under this chapter, the
201.11commissioner must notify the debtor prior to using revenue recapture under this chapter
201.12for collection of the debt. The notice must be sent by United States mail or personal
201.13delivery to the last known address of the debtor.
201.14EFFECTIVE DATE.This section is effective for debts referred after December
201.1531, 2008.

201.16    Sec. 5. Minnesota Statutes 2006, section 270C.33, subdivision 5, is amended to read:
201.17    Subd. 5. Prohibition against collection during appeal period of an order. No
201.18collection action can be taken on an order of assessment, or any other order imposing a
201.19liability, including the filing of liens under section 270C.63, and no late payment penalties
201.20may be imposed when a return has been filed for the tax type and period upon which the
201.21order is based, during the appeal period of an order. The appeal period of an order ends:
201.22(1) 60 days after the order has been mailed to the taxpayer by the commissioner; (2) if an
201.23administrative appeal is filed under section 270C.35, 60 days after determination of the
201.24administrative appeal; (3) if an appeal to Tax Court is filed under chapter 271, when the
201.25decision of the Tax Court is made; or (4) if an appeal to Tax Court is filed and the appeal is
201.26based upon a constitutional challenge to the tax, 60 days after final determination of the
201.27appeal. This subdivision does not apply to a jeopardy assessment under section 270C.36,
201.28or a jeopardy collection under section 270C.36.
201.29EFFECTIVE DATE.This section is effective the day following final enactment.


201.32    Section 1. Minnesota Statutes 2006, section 60A.196, is amended to read:
201.3360A.196 DEFINITIONS.
202.1    Unless the context otherwise requires, the following terms have the meanings given
202.2them for the purposes of sections 60A.195 to 60A.209:
202.3    (a) "Surplus lines insurance" means insurance placed with an insurer permitted
202.4to transact the business of insurance in this state only pursuant to sections 60A.195 to
202.560A.209 .
202.6    (b) "Eligible surplus lines insurer" means an insurer recognized as eligible to write
202.7insurance business under sections 60A.195 to 60A.209 but not licensed by any other
202.8Minnesota law to transact the business of insurance.
202.9    (c) "Ineligible surplus lines insurer" means an insurer not recognized as an eligible
202.10surplus lines insurer pursuant to sections 60A.195 to 60A.209 and not licensed by any
202.11other Minnesota law to transact the business of insurance. "Ineligible surplus lines
202.12insurer" includes a risk retention group as defined under the Liability Risk Retention
202.13Act, Public Law 99-563.
202.14    (d) "Surplus lines licensee" or "licensee" means a person licensed under sections
202.1560A.195 to 60A.209 to place insurance with an eligible or ineligible surplus lines insurer.
202.16    (e) "Association" means an association registered under section 60A.208.
202.17    (f) "Alien insurer" means any insurer which is incorporated or otherwise organized
202.18outside of the United States.
202.19    (g) "Insurance laws" means chapters 60 to 79 inclusive.
202.20    (h) "Stamping" means electronically assigning a unique identifying number that is
202.21specific to a submitted policy, contract, or insurance document.
202.22EFFECTIVE DATE.This section is effective the day following final enactment
202.23and applies to policies written or renewed on or after that date.

202.24    Sec. 2. [60A.2085] SURPLUS LINES ASSOCIATION OF MINNESOTA.
202.25    Subdivision 1. Association created; duties. There is hereby created a nonprofit
202.26association to be known as the Surplus Lines Association of Minnesota. All surplus lines
202.27licensees are members of this association. Section 60A.208, subdivision 5, does not apply
202.28to the provisions of this section. The association shall perform its functions under the
202.29plan of operation established under subdivision 3 and must exercise its powers through a
202.30board of directors established under subdivision 2. The association shall be authorized
202.31and have the duty to:
202.32    (1) receive, record, and stamp all surplus lines insurance documents that surplus
202.33lines licensees are required to file with the association;
203.1    (2) prepare and deliver monthly to the commissioners of revenue and commerce a
203.2report regarding surplus lines business. The report must include a list of all the business
203.3procured during the preceding month, in the form the commissioners prescribe;
203.4    (3) educate its members regarding the surplus lines law of this state including
203.5insurance tax responsibilities and the rules and regulations of the commissioners of
203.6revenue and commerce relative to surplus lines insurance;
203.7    (4) communicate with organizations of agents, brokers, and admitted insurers with
203.8respect to the proper use of the surplus lines market;
203.9    (5) employ and retain persons necessary to carry out the duties of the association;
203.10    (6) borrow money necessary to effect the purposes of the association;
203.11    (7) enter contracts necessary to effect the purposes of the association;
203.12    (8) provide other services to its members that are incidental or related to the
203.13purposes of the association; and
203.14    (9) take other actions reasonably required to implement the provisions of this section.
203.15    Subd. 2. Board of directors. (a) The commissioner shall appoint an interim board
203.16of five directors within 30 days of enactment of this section. The interim board must:
203.17    (1) establish a plan of operation within 60 days after the appointment of the interim
203.18board;
203.19    (2) create a stamping office that is operational no later than December 31, 2008; and
203.20    (3) conduct an election for a board of directors by the membership after December
203.2131, 2008, and no later than one year after the appointment of the interim board.
203.22    (b) Once the responsibilities of the interim board in paragraph (a) are fulfilled, the
203.23association shall function through a board of directors composed of the following:
203.24    (1) one director appointed by the commissioner of revenue;
203.25    (2) one director appointed by the commissioner of commerce; and
203.26    (3) at least five but no more than seven directors elected by the members. The
203.27elected directors must be members of the association.
203.28    Directors may serve until their successors are appointed or elected and their terms
203.29are completed as outlined in the plan of operation.
203.30    Subd. 3. Plan of operation. (a) The plan of operation shall provide for the
203.31formation, operation, and governance of the association. The plan of operation must
203.32provide for the election of a board of directors by the members of the association. The
203.33board of directors shall elect officers as provided for in the plan of operation. The plan
203.34of operation shall establish the manner of voting and may weigh each member's vote to
203.35reflect the annual surplus lines insurance premium written by the member. Members
203.36employed by the same or affiliated employers may consolidate their premiums written
204.1and delegate an individual officer or partner to represent the member in the exercise of
204.2association affairs, including service on the board of directors.
204.3    (b) The plan of operation shall provide for an independent audit once each year of all
204.4the books and records of the association and a report of such independent audit shall be
204.5made to the board of directors, the commissioner of revenue, and the commissioner of
204.6commerce, with a copy made available to each member to review at the association office.
204.7    (c) The plan of operation and any amendments to the plan of operation shall be
204.8submitted to the commissioner and shall be effective upon approval in writing by the
204.9commissioner. The association and all members shall comply with the plan of operation or
204.10any amendments to it. Failure to comply with the plan of operation or any amendments
204.11shall constitute a violation for which the commissioner may issue an order requiring
204.12discontinuance of the violation.
204.13    (d) If the interim board of directors fails to submit a suitable plan of operation
204.14within 60 days following the creation of the interim board, or if at any time thereafter the
204.15association fails to submit required amendments to the plan, the commissioner may submit
204.16to the association a plan of operation or amendments to the plan, which the association
204.17must follow. The plan of operation or amendments submitted by the commissioner shall
204.18continue in force until amended by the commissioner or superseded by a plan of operation
204.19or amendment submitted by the association and approved by the commissioner. A plan
204.20of operation or an amendment submitted by the commissioner constitutes an order of
204.21the commissioner.
204.22    Subd. 4. Reporting requirement. The association shall file with the commissioner:
204.23    (1) a copy of its plan of operation and any amendments to it;
204.24    (2) a current list of its members revised at least annually; and
204.25    (3) the name and address of a member of the board residing in this state upon
204.26whom notices or orders of the commissioner or processes issued at the direction of the
204.27commissioner may be served.
204.28    Subd. 5. Examination. The commissioner shall, at such times as deemed necessary,
204.29make or cause to be made an examination of the association. The officers, managers,
204.30agents, and employees of the association may be examined at any time, under oath, and
204.31shall exhibit all books, records, accounts, documents, or agreements governing its method
204.32of operation. The commissioner shall furnish a copy of the examination report to the
204.33association. If the commissioner finds the association to be in violation of this section, the
204.34commissioner may issue an order requiring the discontinuance of the violation.
204.35    Subd. 6. Immunity. There shall be no liability on the part of and no causes of action
204.36of any nature shall arise against the association, its directors, officers, agents, or employees
205.1for any action taken or omitted by them in the performance of their powers and duties
205.2under this section, absent gross negligence or willful misconduct.
205.3    Subd. 7. Stamping fee. The services performed by the association shall be
205.4funded by a stamping fee assessed for each premium-bearing document submitted to
205.5the association. The stamping fee shall be established by the board of directors of the
205.6association from time to time. The stamping fee shall be paid by the insured to the surplus
205.7lines licensee and remitted electronically to the association by the surplus lines licensee.
205.8    Subd. 8. Data classification. Unless otherwise classified by statute, a temporary
205.9classification under section 13.06, or federal law, information obtained by the
205.10commissioner from the association is public, except that any data identifying insureds is
205.11private data on individuals or nonpublic data as defined in section 13.02, subdivisions
205.129 and 12.
205.13EFFECTIVE DATE.This section is effective the day following final enactment
205.14and applies to policies written or renewed on or after that date.

205.15    Sec. 3. [60A.2086] LICENSEE'S DUTY TO SUBMIT DOCUMENTS; PENALTY.
205.16    Subdivision 1. Submission of documents to the Surplus Lines Association
205.17of Minnesota; certification. (a) A surplus lines licensee shall submit every insurance
205.18policy or contract issued under the licensee's license to the Surplus Lines Association of
205.19Minnesota for recording and stamping. The submission and stamping must be effected
205.20through electronic means. The submission must include:
205.21    (1) the name of the insured;
205.22    (2) a description and location of the insured property or risk;
205.23    (3) the amount insured;
205.24    (4) the gross premiums charged or returned;
205.25    (5) the name of the surplus lines insurer from whom coverage has been procured;
205.26    (6) the kind or kinds of insurance procured; and
205.27    (7) the amount of premium subject to tax.
205.28    (b) The submission of insurance policies or contracts to the Surplus Lines
205.29Association of Minnesota constitutes a certification by the surplus lines licensee, or by the
205.30insurance producer who presented the risk to the surplus lines licensee for placement as a
205.31surplus lines risk, that the insurance policies or contracts were procured in accordance
205.32with sections 60A.195 to 60A.209.
205.33    Subd. 2. Stamping requirement; penalty. (a) It shall be unlawful for an insurance
205.34agent, broker, or surplus lines licensee to deliver in this state any surplus lines insurance
205.35policy or contract unless the insurance document is stamped by the association. A
206.1licensee's failure to comply with the requirements of this subdivision shall not affect the
206.2validity of the coverage.
206.3    (b) Any insurance agent, broker, or surplus lines licensee who delivers in this state
206.4any insurance policy or contract that has not been stamped by the association shall be
206.5subject to a penalty payable to the commissioner as follows:
206.6    (1) $50 for delivery of the first unstamped policy;
206.7    (2) $250 for delivery of a second unstamped policy; and
206.8    (3) $1,000 per policy for delivery of any additional unstamped policies.
206.9EFFECTIVE DATE.This section is effective January 1, 2009, and applies to
206.10policies written or renewed after December 31, 2008.

206.11    Sec. 4. Minnesota Statutes 2007 Supplement, section 298.227, is amended to read:
206.12298.227 TACONITE ECONOMIC DEVELOPMENT FUND.
206.13    For production in 2007, distributions in 2008, and beginning for production in
206.142013, distributions in 2014 and thereafter, an amount equal to that distributed pursuant to
206.15each taconite producer's taxable production and qualifying sales under section 298.28,
206.16subdivision 9a , shall be held by the Iron Range Resources and Rehabilitation Board in a
206.17separate taconite economic development fund for each taconite and direct reduced ore
206.18producer. Money from the fund for each producer shall be released by the commissioner
206.19after review by a joint committee consisting of an equal number of representatives of the
206.20salaried employees and the nonsalaried production and maintenance employees of that
206.21producer. The District 11 director of the United States Steelworkers of America, on advice
206.22of each local employee president, shall select the employee members. In nonorganized
206.23operations, the employee committee shall be elected by the nonsalaried production and
206.24maintenance employees. The review must be completed no later than six months after the
206.25producer presents a proposal for expenditure of the funds to the committee. The funds
206.26held pursuant to this section may be released only for acquisition of plant and stationary
206.27mining equipment and facilities for the producer or for research and development in
206.28Minnesota on new mining, or taconite, iron, or steel production technology, but only if
206.29the producer provides a matching expenditure to be used for the same purpose of at least
206.3050 percent of the distribution based on 14.7 cents per ton beginning with distributions in
206.312002. Effective for proposals for expenditures of money from the fund beginning May 26,
206.322007, the commissioner may not release the funds before the next scheduled meeting of
206.33the board. If the board rejects a proposed expenditure, the funds must be deposited in the
206.34Taconite Environmental Protection Fund under sections 298.222 to 298.225. If a producer
206.35uses money which has been released from the fund prior to May 26, 2007 to procure
207.1haulage trucks, mobile equipment, or mining shovels, and the producer removes the piece
207.2of equipment from the taconite tax relief area defined in section 273.134 within ten years
207.3from the date of receipt of the money from the fund, a portion of the money granted
207.4from the fund must be repaid to the taconite economic development fund. The portion
207.5of the money to be repaid is 100 percent of the grant if the equipment is removed from
207.6the taconite tax relief area within 12 months after receipt of the money from the fund,
207.7declining by ten percent for each of the subsequent nine years during which the equipment
207.8remains within the taconite tax relief area. If a taconite production facility is sold after
207.9operations at the facility had ceased, any money remaining in the fund for the former
207.10producer may be released to the purchaser of the facility on the terms otherwise applicable
207.11to the former producer under this section. If a producer fails to provide matching funds
207.12for a proposed expenditure within six months after the commissioner approves release
207.13of the funds, the funds are available for release to another producer in proportion to the
207.14distribution provided and under the conditions of this section. Any portion of the fund
207.15which is not released by the commissioner within two years of its deposit in the fund shall
207.16be divided between the taconite environmental protection fund created in section 298.223
207.17and the Douglas J. Johnson economic protection trust fund created in section 298.292 for
207.18placement in their respective special accounts. Two-thirds of the unreleased funds shall be
207.19distributed to the taconite environmental protection fund and one-third to the Douglas J.
207.20Johnson economic protection trust fund.

207.21    Sec. 5. [298.2271] IRON RANGE REVITALIZATION ACCOUNT.
207.22    For production years 2008 through 2012, and for distributions in 2009 through
207.23distributions in 2013 only, an amount equal to that distributed pursuant to each taconite
207.24producer's taxable production and qualifying sales under section 298.28, subdivision
207.259a , shall be held by the Iron Range Resources and Rehabilitation Board in a separate
207.26Iron Range revitalization account. Funds from the account may be spent for projects
207.27including but not limited to public facility improvements, community development,
207.28economic development, renewable energy, and diversification of the Iron Range economy.
207.29Money from the account shall be released by the commissioner only after the Iron Range
207.30Resources and Rehabilitation Board has approved the project by a majority vote. A
207.31project review panel shall consist of nine members. Three members shall be Iron Range
207.32Resources and Rehabilitation Board members appointed by the chair; three members shall
207.33be selected by the District 11 director of the United States Steelworkers of America;
207.34and three members shall be mining company representatives, one each from United
207.35States Steel Corporation, Cleveland-Cliffs Incorporated, and ArcelorMittal. The review
207.36panel must review each project for which funds are sought under this section and make
208.1recommendations to the board by August 31 of each year. The board must vote on the
208.2recommendations no later than October 31 of each year.

208.3    Sec. 6. Minnesota Statutes 2006, section 298.24, subdivision 1, as amended by Laws
208.42008, chapter 154, article 8, section 5, is amended to read:
208.5    Subdivision 1. Imposed; calculation. (a) For concentrate produced in 2001, 2002,
208.6and 2003, there is imposed upon taconite and iron sulphides, and upon the mining and
208.7quarrying thereof, and upon the production of iron ore concentrate therefrom, and upon
208.8the concentrate so produced, a tax of $2.103 per gross ton of merchantable iron ore
208.9concentrate produced therefrom. For concentrates produced in 2005, the tax rate is the
208.10same rate imposed for concentrates produced in 2004.
208.11    (b)(1) For concentrates produced in 2006 and subsequent years, the tax rate shall be
208.12equal to the preceding year's tax rate plus an amount equal to the preceding year's tax rate
208.13multiplied by the percentage increase in the implicit price deflator from the fourth quarter
208.14of the second preceding year to the fourth quarter of the preceding year. "Implicit price
208.15deflator" means the implicit price deflator for the gross domestic product prepared by the
208.16Bureau of Economic Analysis of the United States Department of Commerce.
208.17    (2) For concentrates produced in 2009, the amount of the increase in the tax rate
208.18under this paragraph over the tax rate applicable to concentrates produced in 2008 equals
208.19the greater of (A) the increase computed under clause (1) or (B) ten cents per taxable
208.20ton. The resulting tax rate for concentrates produced in 2009 must be used as the base
208.21for determining the tax rate under this paragraph for concentrates produced in 2010 and
208.22subsequent years.
208.23    (c) On concentrates produced in 1997 and thereafter, an additional tax is imposed
208.24equal to three cents per gross ton of merchantable iron ore concentrate for each one
208.25percent that the iron content of the product exceeds 72 percent, when dried at 212 degrees
208.26Fahrenheit.
208.27    (d) The tax shall be imposed on the average of the production for the current year
208.28and the previous two years. The rate of the tax imposed will be the current year's tax rate.
208.29This clause shall not apply in the case of the closing of a taconite facility if the property
208.30taxes on the facility would be higher if this clause and section 298.25 were not applicable.
208.31    (e) If the tax or any part of the tax imposed by this subdivision is held to be
208.32unconstitutional, a tax of $2.103 per gross ton of merchantable iron ore concentrate
208.33produced shall be imposed.
208.34    (f) Consistent with the intent of this subdivision to impose a tax based upon the
208.35weight of merchantable iron ore concentrate, the commissioner of revenue may indirectly
209.1determine the weight of merchantable iron ore concentrate included in fluxed pellets by
209.2subtracting the weight of the limestone, dolomite, or olivine derivatives or other basic
209.3flux additives included in the pellets from the weight of the pellets. For purposes of this
209.4paragraph, "fluxed pellets" are pellets produced in a process in which limestone, dolomite,
209.5olivine, or other basic flux additives are combined with merchantable iron ore concentrate.
209.6No subtraction from the weight of the pellets shall be allowed for binders, mineral and
209.7chemical additives other than basic flux additives, or moisture.
209.8    (g)(1) Notwithstanding any other provision of this subdivision, for the first two years
209.9of a plant's commercial production of direct reduced ore, no tax is imposed under this
209.10section. As used in this paragraph, "commercial production" is production of more than
209.1150,000 tons of direct reduced ore in the current year or in any prior year, "noncommercial
209.12production" is production of 50,000 tons or less of direct reduced ore in any year, and
209.13"direct reduced ore" is ore that results in a product that has an iron content of at least 75
209.14percent. For the third year of a plant's commercial production of direct reduced ore, the
209.15rate to be applied to direct reduced ore is 25 percent of the rate otherwise determined
209.16under this subdivision. For the fourth commercial production year, the rate is 50 percent of
209.17the rate otherwise determined under this subdivision; for the fifth commercial production
209.18year, the rate is 75 percent of the rate otherwise determined under this subdivision; and for
209.19all subsequent commercial production years, the full rate is imposed.
209.20    (2) Subject to clause (1), production of direct reduced ore in this state is subject to
209.21the tax imposed by this section, but if that production is not produced by a producer
209.22of taconite or iron sulfides, the production of taconite or iron sulfides consumed in the
209.23production of direct reduced iron in this state is not subject to the tax imposed by this
209.24section on taconite or iron sulfides.
209.25    (3) Notwithstanding any other provision of this subdivision, no tax is imposed
209.26on direct reduced ore under this section during the facility's noncommercial production
209.27of direct reduced ore. The taconite or iron sulphides consumed in the noncommercial
209.28production of direct reduced ore is subject to the tax imposed by this section on taconite
209.29and iron sulphides. Three-year average production of direct reduced ore does not
209.30include production of direct reduced ore in any noncommercial year. Three-year average
209.31production for a direct reduced ore facility that has noncommercial production is the
209.32average of the commercial production of direct reduced ore for the current year and the
209.33previous two commercial years.
209.34    (4) This paragraph applies only to plants for which all environmental permits have
209.35been obtained and construction has begun before July 1, 2008."
209.36Delete the title and insert:
210.2relating to the financing and operation of state and local government; making
210.3policy, technical, administrative, enforcement, collection, refund, clarifying,
210.4and other changes to income, franchise, property, sales and use, minerals,
210.5wheelage, mortgage, deed, and estate taxes, and other taxes and tax-related
210.6provisions; providing for homestead credit state refund; providing for aids to
210.7local governments; providing city foreclosure and deed grants; changing and
210.8providing property tax exemptions and credits; modifying job opportunity
210.9building zone program; modifying green acre eligibility requirements; providing
210.10for senior citizen and seasonal recreational property tax deferral programs;
210.11modifying transit taxing district; modifying levies, property valuation procedures,
210.12homestead provisions, property tax classes, and class rates; providing for and
210.13modifying sales tax exemptions; exempting two-wheel, motorized vehicles from
210.14wheelage tax; providing a seed capital investment credit; providing for additional
210.15financing of metropolitan area transit and paratransit capital expenditures;
210.16authorizing issuance of certain obligations; modifying provision governing
210.17bonding for county libraries; modifying and authorizing local government
210.18taxes and levies; modifying, extending, and authorizing certain tax increment
210.19financing districts; authorizing and modifying local sales taxes; prohibiting
210.20the imposition of new local sales taxes; providing federal updates; changing
210.21accelerated sales tax; creating Surplus Lines Association of Minnesota; creating
210.22Iron Range revitalization account; changing provisions related to data practices
210.23and debt collection; requiring studies; providing appointments; appropriating
210.24money;amending Minnesota Statutes 2006, sections 13.51, subdivision 3;
210.2513.585, subdivision 5; 16D.02, subdivisions 3, 6; 16D.04, subdivision 2, as
210.26amended; 60A.196; 163.051, subdivision 1; 168.012, subdivision 1, by adding
210.27a subdivision; 168.013, subdivision 1f; 168A.03, subdivision 1; 169.01, by
210.28adding a subdivision; 169.781, subdivision 1; 216B.1646; 270A.08, subdivision
210.291; 270B.15; 270C.33, subdivision 5; 270C.56, subdivisions 1, as amended, 3;
210.30270C.85, subdivision 2; 272.02, subdivisions 13, 20, 21, 27, 31, 38, 49, by
210.31adding subdivisions; 272.03, subdivision 3, by adding a subdivision; 273.11,
210.32subdivisions 1, 1a, 8, 14b, by adding subdivisions; 273.111, subdivisions 3,
210.33as amended, 4, 8, 9, 11, 11a, by adding a subdivision; 273.121, as amended;
210.34273.124, subdivisions 1, 6, 13, as amended, 21; 273.128, subdivision 1, as
210.35amended; 273.13, subdivisions 23, as amended, 24, 25, as amended, 33, 34, as
210.36added; 273.1384, subdivision 1; 274.01, subdivision 3; 274.014, subdivision
210.373; 274.14; 275.025, subdivisions 1, 2; 275.065, subdivisions 1c, 6, 8, 9, 10,
210.38by adding subdivisions; 276.04, subdivision 2, as amended; 282.08; 287.20,
210.39subdivisions 3a, 9, by adding a subdivision; 289A.12, by adding a subdivision;
210.40289A.18, subdivision 1, as amended; 289A.19, subdivision 2, by adding a
210.41subdivision; 289A.20, subdivision 4, as amended; 289A.40, subdivision 1;
210.42289A.55, by adding a subdivision; 289A.60, subdivision 15, as amended, by
210.43adding a subdivision; 290.01, subdivisions 6b, 19a, as amended, 29, by adding a
210.44subdivision; 290.06, by adding a subdivision; 290.068, subdivision 3; 290.07,
210.45subdivision 1; 290.091, subdivision 2, as amended; 290.21, subdivision 4;
210.46290.92, subdivisions 1, 26, 31, as added; 290A.03, subdivision 13; 290A.04,
210.47subdivisions 2h, 3, 4, by adding a subdivision; 290B.03, subdivision 1; 290B.04,
210.48subdivisions 1, 3, 4; 290B.05, subdivision 1; 290B.07; 291.03, subdivision 1;
210.49295.50, subdivision 4; 295.52, subdivision 4, as amended; 295.53, subdivision
210.504a; 296A.07, subdivision 4; 296A.08, subdivision 3; 296A.16, subdivision 2;
210.51297A.61, subdivisions 22, 29; 297A.665, as amended; 297A.67, subdivision
210.527, as amended; 297A.70, subdivisions 2, 8; 297A.71, by adding subdivisions;
210.53297A.75; 297A.99, subdivision 1, as amended; 297A.995, subdivision 10,
210.54by adding subdivisions; 297B.01, subdivision 7, by adding a subdivision;
210.55297B.03; 297F.01, subdivision 8; 297F.09, subdivision 10, as amended;
210.56297F.21, subdivision 1; 297G.01, subdivision 9; 297G.09, subdivision 9, as
210.57amended; 297H.09; 297I.05, subdivision 12; 298.24, subdivision 1, as amended;
210.58365A.095; 383A.80, subdivision 4; 383A.81, subdivisions 1, 2; 383B.80,
211.1subdivision 4; 383E.20; 429.101, subdivision 1; 469.033, subdivision 6; 469.040,
211.2subdivision 4; 469.174, subdivision 10b; 469.177, subdivision 1c, by adding
211.3a subdivision; 469.1813, subdivision 8; 469.312, by adding a subdivision;
211.4469.319; 469.3201; 473.39, by adding a subdivision; 473.446, subdivisions 2, 8;
211.5477A.011, subdivisions 34, 36, as amended, by adding subdivisions; 477A.0124,
211.6subdivision 5; 477A.013, subdivisions 1, 8, as amended, 9, as amended;
211.7477A.03; Minnesota Statutes 2007 Supplement, sections 115A.1314, subdivision
211.82; 268.19, subdivision 1; 273.1231, subdivision 7, by adding a subdivision;
211.9273.1232, subdivision 1; 273.1233, subdivisions 1, 3; 273.1234; 273.1235,
211.10subdivisions 1, 3; 273.124, subdivision 14; 273.1393; 275.065, subdivisions
211.111, 1a, 3; 298.227; Laws 1991, chapter 291, article 8, section 27, subdivisions
211.123, as amended, 4, as amended; Laws 1995, chapter 264, article 5, section 46,
211.13subdivision 2; Laws 2003, chapter 127, article 10, section 31, subdivision 1;
211.14Laws 2006, chapter 259, article 10, section 14, subdivision 1; Laws 2008, chapter
211.15154, article 2, section 11; article 3, section 7; article 9, sections 23; 24; proposing
211.16coding for new law in Minnesota Statutes, chapters 60A; 116J; 169; 273; 298;
211.17383C; 383D; 383E; 469; proposing coding for new law as Minnesota Statutes,
211.18chapter 290D; repealing Minnesota Statutes 2006, sections 273.11, subdivisions
211.1914, 14a; 273.111, subdivision 6; 290.191, subdivision 4; 290A.04, subdivisions
211.202, 2b; 473.4461; 477A.014, subdivision 5; Minnesota Statutes 2007 Supplement,
211.21section 477A.014, subdivision 4; Laws 2005, First Special Session chapter 3,
211.22article 5, section 24; Minnesota Rules, parts 8031.0100, subpart 3; 8093.2100."