Minnesota Legislature
SF 1276
1st Engrossment - 81st Legislature (1999 - 2000) Posted on 12/15/2009 12:00am
KEY: stricken = removed, old language.
underscored = added, new language.
Current Version - 1st Engrossment
1.1 A bill for an act 1.2 relating to taxation; providing for payment of a sales 1.3 tax rebate; reducing certain income tax rates and 1.4 expanding certain income tax brackets; providing for 1.5 apportionment of certain income; modifying the 1.6 determination and administration of income, property, 1.7 sales, fuel, waste management, health care provider, 1.8 and other taxes; conforming with changes in federal 1.9 income tax provisions; authorizing the cities of 1.10 Proctor and New Ulm to impose sales and use taxes; 1.11 reducing the motor vehicle registration tax; providing 1.12 programs and funding for workforce development 1.13 programs; providing certain property tax exemptions 1.14 and modifying classifications; reducing the class 1.15 rates on agricultural property; authorizing issuance 1.16 of bonds for acquisition of conservation rights, by 1.17 regional rail authorities, for capital investments 1.18 related to transit, for projects in certain 1.19 municipalities, and for youth ice facilities; 1.20 authorizing and modifying payment of certain aids to 1.21 local units of government; authorizing levies by 1.22 certain political subdivisions; providing for state 1.23 funding of district courts; modifying provisions 1.24 relating to tax increment financing and local economic 1.25 development; authorizing exceptions to general law for 1.26 certain tax increment financing districts; authorizing 1.27 establishment of certain local economic development 1.28 agencies and water and sanitary sewer districts; 1.29 authorizing the metropolitan airports commission to 1.30 impose a tax on airport sales, and providing for the 1.31 use of the proceeds; modifying tax delinquency and 1.32 forfeiture provisions; adjusting the rate of the 1.33 taconite production tax and providing for use of the 1.34 proceeds; requiring tax rebates when there is a budget 1.35 surplus; authorizing the director of the office of 1.36 strategic and long-range planning to require certain 1.37 processes in relation to the Minnesota municipal 1.38 board; authorizing Chisago county to impose an 1.39 aggregate removal tax; providing for certain transfers 1.40 of funds; appropriating money; regulating state and 1.41 local business subsidies; amending Minnesota Statutes 1.42 1998, sections 16D.09; 60A.19, subdivision 6; 92.51; 1.43 97A.065, subdivision 2; 116L.03, subdivisions 1 and 2; 1.44 168.013, subdivision 1a; 204B.135, by adding a 1.45 subdivision; 256.969, by adding a subdivision; 1.46 268.022; 270.07, subdivision 1; 270.65; 270.78; 2.1 270A.03, subdivision 2; 270A.07, subdivision 2; 2.2 270A.08, subdivision 2; 272.02, subdivision 1; 2.3 272.026; 272.027; 272.03, subdivision 6; 272.67, by 2.4 adding a subdivision; 273.11, subdivision 16; 273.111, 2.5 by adding a subdivision; 273.124, subdivisions 1, 7, 2.6 8, 14, and by adding a subdivision; 273.13, 2.7 subdivisions 23, 24, and 31; 273.1382, subdivision 1; 2.8 273.1398, subdivisions 1a, 2, and by adding a 2.9 subdivision; 273.1399, subdivision 1; 275.066; 279.37, 2.10 subdivisions 1, 1a, and 2; 281.23, subdivisions 2, 4, 2.11 and 6; 282.01, subdivisions 1, 4, and 7; 282.04, 2.12 subdivision 2; 282.05; 282.08; 282.09; 282.241; 2.13 282.261, subdivision 4, and by adding a subdivision; 2.14 283.10; 289A.02, subdivision 7; 289A.31, subdivision 2.15 2; 289A.40, subdivision 1a; 289A.50, subdivision 7; 2.16 289A.55, subdivision 9; 289A.56, subdivision 4; 2.17 290.01, subdivisions 7, 19, 19b, 31, and by adding a 2.18 subdivision; 290.06, subdivisions 2c and 2d; 290.0671, 2.19 subdivision 1; 290.091, subdivision 2; 290.17, 2.20 subdivisions 3, 4, and 6; 290A.03, subdivision 15; 2.21 291.005, subdivision 1; 295.50, subdivisions 4 and 9b; 2.22 295.53, subdivision 1; 295.55, subdivisions 2 and 3; 2.23 295.57, by adding a subdivision; 296A.16, by adding 2.24 subdivisions; 297A.48, by adding a subdivision; 2.25 297H.05; 298.22, subdivision 7; 298.24, subdivision 1; 2.26 298.28, subdivisions 9a and 9b; 298.296, subdivision 2.27 4; 299D.03, subdivision 5; 357.021, subdivision 1a; 2.28 373.40, subdivision 1; 375.18, subdivision 12; 2.29 375.192, subdivision 2; 383C.482, subdivision 1; 2.30 383D.41, subdivisions 1, 2, 3, and by adding 2.31 subdivisions; 398A.04, subdivisions 1, 8, and 9; 2.32 398A.07, subdivision 2; 428A.11, subdivision 6, and by 2.33 adding subdivisions; 428A.13, subdivisions 1 and 3; 2.34 428A.14, subdivision 1; 428A.15; 428A.16; 428A.17; 2.35 428A.19; 465.82, by adding a subdivision; 469.169, 2.36 subdivision 12; 469.1735, by adding a subdivision; 2.37 469.176, subdivision 4g; 469.1763, by adding a 2.38 subdivision; 469.1791, subdivision 3; 469.1813, 2.39 subdivisions 1, 2, and by adding subdivisions; 473.39, 2.40 by adding subdivisions; 473.898, subdivision 3; 2.41 475.52, subdivisions 1, 3, and 4; 475.58, by adding a 2.42 subdivision; 477A.011, subdivision 36; 477A.03, 2.43 subdivision 2; 485.018, subdivision 5; 487.02, 2.44 subdivision 2; 487.32, subdivision 3; 487.33, 2.45 subdivision 5; 574.34, subdivision 1; Laws 1988, 2.46 chapter 645, section 3; Laws 1993, chapter 375, 2.47 article 14, section 22, subdivision 1; Laws 1997, 2.48 chapter 231, articles 1, section 19, subdivisions 1 2.49 and 3; and 2, section 68, subdivision 3, as amended; 2.50 Laws 1997, First Special Session chapter 3, section 2.51 27; Laws 1997, Second Special Session chapter 2, 2.52 section 6; Laws 1998, chapter 389, article 11, section 2.53 29; proposing coding for new law in Minnesota 2.54 Statutes, chapters 16A; 103F; 116J; 116L; 256B; 375; 2.55 414; and 415; repealing Minnesota Statutes 1998, 2.56 sections 92.22; 116J.991; 268.975; 268.976; 268.9771; 2.57 268.978; 268.9781; 268.9782; 268.9783; 268.979; 2.58 268.98; 273.1383; 280.27; 281.13; 281.38; 284.01; 2.59 284.02; 284.03; 284.04; 284.05; 284.06; 428A.21; and 2.60 477A.05; Laws 1997, chapter 231, article 1, section 2.61 19, subdivision 2. 2.62 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 2.63 ARTICLE 1 2.64 SALES TAX REBATE 2.65 Section 1. [STATEMENT OF PURPOSE.] 2.66 (a) The state of Minnesota derives revenues from a variety 3.1 of taxes, fees, and other sources, including the state sales tax. 3.2 (b) It is fair and reasonable to refund the existing state 3.3 budget surplus in the form of a rebate of nonbusiness consumer 3.4 sales taxes paid by individuals in calendar year 1997. 3.5 (c) Information concerning the amount of sales tax paid at 3.6 various income levels is contained in the Minnesota tax 3.7 incidence report, which is written by the commissioner of 3.8 revenue and presented to the legislature according to Minnesota 3.9 Statutes, section 270.0682. 3.10 (d) It is fair and reasonable to use information contained 3.11 in the Minnesota tax incidence report to determine the 3.12 proportionate share of the sales tax rebate due each eligible 3.13 taxpayer since no effective or practical mechanism exists for 3.14 determining the amount of actual sales tax paid by each eligible 3.15 individual. 3.16 Sec. 2. [SALES TAX REBATE.] 3.17 (a) An individual who: 3.18 (1) was eligible for a credit under Laws 1997, chapter 231, 3.19 article 1, section 16, as amended by Laws 1997, First Special 3.20 Session chapter 5, section 35, and Laws 1997, Third Special 3.21 Session chapter 3, section 11, and Laws 1998, chapter 304, and 3.22 Laws 1998, chapter 389, article 1, section 3, and who filed for 3.23 that credit on or before June 15, 1999; or 3.24 (2) filed a 1997 Minnesota income tax return and had a tax 3.25 liability before refundable credits on that return of at least 3.26 $1 but did not file the claim for credit authorized under Laws 3.27 1997, chapter 231, article 1, section 16, as amended, and who 3.28 was not allowed to be claimed as a dependent on a 1997 federal 3.29 income tax return filed by another person; or 3.30 (3) had the property taxes payable on his or her homestead 3.31 abated to zero under Laws 1997, chapter 231, article 2, section 3.32 64, 3.33 shall receive a sales tax rebate. 3.34 (b) The sales tax rebate for taxpayers who filed the claim 3.35 for credit authorized under Laws 1997, chapter 231, article 1, 3.36 section 16, as amended, or the 1997 Minnesota income tax return 4.1 as married filing joint or head of household must be computed 4.2 according to the following schedule: 4.3 Income Sales Tax Rebate 4.4 less than $2,500 $ 380 4.5 at least $2,500 but less than $5,000 $ 497 4.6 at least $5,000 but less than $10,000 $ 532 4.7 at least $10,000 but less than $15,000 $ 582 4.8 at least $15,000 but less than $20,000 $ 641 4.9 at least $20,000 but less than $25,000 $ 680 4.10 at least $25,000 but less than $30,000 $ 732 4.11 at least $30,000 but less than $35,000 $ 808 4.12 at least $35,000 but less than $40,000 $ 869 4.13 at least $40,000 but less than $45,000 $ 927 4.14 at least $45,000 but less than $50,000 $ 977 4.15 at least $50,000 but less than $60,000 $1,028 4.16 at least $60,000 but less than $70,000 $1,136 4.17 at least $70,000 but less than $80,000 $1,232 4.18 at least $80,000 but less than $90,000 $1,353 4.19 at least $90,000 but less than $100,000 $1,503 4.20 at least $100,000 but less than $120,000 $1,628 4.21 at least $120,000 but less than $140,000 $1,783 4.22 at least $140,000 but less than $160,000 $1,928 4.23 at least $160,000 but less than $180,000 $2,064 4.24 at least $180,000 but less than $200,000 $2,193 4.25 at least $200,000 but less than $400,000 $2,804 4.26 at least $400,000 but less than $600,000 $3,690 4.27 at least $600,000 but less than $800,000 $4,427 4.28 $800,000 and over $5,000 4.29 (c) The sales tax rebate for individuals who filed the 4.30 claim for credit authorized under Laws 1997, chapter 231, 4.31 article 1, section 16, as amended, or the 1997 Minnesota income 4.32 tax return, as single or married filing separately must be 4.33 computed according to the following schedule: 4.34 Income Sales Tax Rebate 4.35 less than $2,500 $ 217 4.36 at least $2,500 but less than $5,000 $ 264 5.1 at least $5,000 but less than $10,000 $ 318 5.2 at least $10,000 but less than $15,000 $ 432 5.3 at least $15,000 but less than $20,000 $ 492 5.4 at least $20,000 but less than $25,000 $ 526 5.5 at least $25,000 but less than $30,000 $ 546 5.6 at least $30,000 but less than $40,000 $ 604 5.7 at least $40,000 but less than $50,000 $ 688 5.8 at least $50,000 but less than $70,000 $ 823 5.9 at least $70,000 but less than $100,000 $1,016 5.10 at least $100,000 but less than $140,000 $1,224 5.11 at least $140,000 but less than $200,000 $1,478 5.12 at least $200,000 but less than $400,000 $2,004 5.13 $400,000 and over $2,500 5.14 (d) Individuals who were not residents of Minnesota for any 5.15 part of 1997 and who paid more than $10 in Minnesota sales tax 5.16 on nonbusiness consumer purchases in that year qualify for a 5.17 rebate under this paragraph only. Qualifying nonresidents must 5.18 file a claim for rebate on a form prescribed by the commissioner 5.19 before the later of May 15, 1999, or 30 days after the date of 5.20 enactment of this act. The claim must include receipts showing 5.21 the Minnesota sales tax paid and the date of the sale. Taxes 5.22 paid on purchases allowed in the computation of federal taxable 5.23 income or reimbursed by an employer are not eligible for the 5.24 rebate. The commissioner shall determine the qualifying taxes 5.25 paid and rebate the lesser of: 5.26 (1) 68.08 percent of that amount; or 5.27 (2) the maximum amount for which the claimant would have 5.28 been eligible as determined under paragraph (b) if the taxpayer 5.29 filed the 1997 federal income tax return as a married taxpayer 5.30 filing jointly or head of household, or as determined under 5.31 paragraph (c) for other taxpayers. 5.32 (e) "Income," for purposes of this section other than 5.33 paragraph (d), is taxable income as defined in section 63 of the 5.34 Internal Revenue Code of 1986, as amended through December 31, 5.35 1996, plus the sum of any additions to federal taxable income 5.36 for the taxpayer under Minnesota Statutes, section 290.01, 6.1 subdivision 19a, and reported on the original return submitted 6.2 to claim the credit under Laws 1997, chapter 231, article 1, 6.3 section 16, as amended, or by subsequent adjustments to that 6.4 return made within the time limits specified in paragraph (h). 6.5 For an individual who was a resident of Minnesota for less than 6.6 the entire year, the sales tax rebate equals the sales tax 6.7 rebate calculated under paragraph (b) or (c) multiplied by the 6.8 percentage determined pursuant to Minnesota Statutes, section 6.9 290.06, subdivision 2c, paragraph (e), as calculated on the 6.10 original return submitted to claim the credit under Laws 1997, 6.11 chapter 231, article 1, section 16, as amended, or by subsequent 6.12 adjustments to that return made within the time limits specified 6.13 in paragraph (h). For purposes of paragraph (d), "income" is 6.14 taxable income as defined in section 63 of the Internal Revenue 6.15 Code of 1986, as amended through December 31, 1996, and reported 6.16 on the taxpayer's original federal tax return for the first 6.17 taxable year beginning after December 31, 1996. 6.18 (f) Prior to payment, the commissioner of revenue shall 6.19 reduce the sales tax rebates calculated in paragraphs (b), (c), 6.20 and (d) proportionately to account for the amount of credits 6.21 described in Laws 1997, chapter 231, article 1, section 16, as 6.22 amended, that are paid on or after January 1, 1999, but before 6.23 July 1, 1999, so that the amount of sales tax rebates payable 6.24 under paragraphs (b), (c), and (d) do not exceed $1,321,000,000. 6.25 These adjustments are not rules subject to Minnesota Statutes, 6.26 chapter 14. 6.27 (g) The commissioner of revenue may begin making sales tax 6.28 rebates by August 1, 1999. Sales tax rebates not paid by 6.29 October 1, 1999, shall bear interest at the rate specified in 6.30 Minnesota Statutes, section 270.75. 6.31 (h) A sales tax rebate shall not be adjusted based on 6.32 changes to the return on which the claim for credit authorized 6.33 under Laws 1997, chapter 231, article 1, section 16, as amended, 6.34 is based that are made by order of assessment after April 15, 6.35 1999, or made by the taxpayer that are filed with the 6.36 commissioner of revenue after April 15, 1999. 7.1 (i) Individuals who filed a joint claim for credit under 7.2 Laws 1997, chapter 231, article 1, section 16, as amended, shall 7.3 receive a joint sales tax rebate. After the sales tax rebate 7.4 has been issued, but before the check has been cashed, either 7.5 joint claimant may request a separate check for one-half of the 7.6 joint sales tax rebate. 7.7 (j) The sales tax rebate is a "Minnesota tax law" for 7.8 purposes of Minnesota Statutes, section 270B.01, subdivision 8. 7.9 (k) The sales tax rebate is "an overpayment of any tax 7.10 collected by the commissioner" for purposes of Minnesota 7.11 Statutes, section 270.07, subdivision 5. For purposes of this 7.12 paragraph, a joint sales tax rebate is payable to each spouse 7.13 equally. 7.14 (l) If the commissioner of revenue cannot locate an 7.15 individual entitled to a sales tax rebate by July 1, 2001, or if 7.16 an individual to whom a sales tax rebate was issued has not 7.17 cashed the check by July 1, 2001, the right to the sales tax 7.18 rebate shall lapse and the check shall be deposited in the 7.19 general fund. 7.20 (m) Individuals entitled to a sales tax rebate pursuant to 7.21 paragraph (a), but who did not receive one, and individuals who 7.22 receive a sales tax rebate that was not correctly computed, must 7.23 file a claim with the commissioner before July 1, 2000, in a 7.24 form prescribed by the commissioner. These claims shall be 7.25 treated as if they are a claim for refund under Minnesota 7.26 Statutes, section 289A.50, subdivisions 4 and 7. 7.27 (n) The sales tax rebate is a refund subject to revenue 7.28 recapture under Minnesota Statutes, chapter 270A. The 7.29 commissioner of revenue shall remit the entire refund to the 7.30 claimant agency, which shall, upon the request of the spouse who 7.31 does not owe the debt, refund one-half of the joint sales tax 7.32 rebate to the spouse who does not owe the debt. 7.33 (o) The amount necessary to make the sales tax rebates and 7.34 interest provided in this section is appropriated from the 7.35 general fund to the commissioner of revenue in fiscal years 2000 7.36 and 2001. 8.1 (p) If a sales tax rebate check is cashed by someone other 8.2 than the payee or payees of the check, and the commissioner of 8.3 revenue determines that the check has been forged or improperly 8.4 endorsed, the commissioner may issue an order of assessment for 8.5 the amount of the check against the person or persons cashing 8.6 it. The assessment must be made within two years after the 8.7 check is cashed, but if cashing the check constitutes theft 8.8 under Minnesota Statutes, section 609.52, or forgery under 8.9 Minnesota Statutes, section 609.631, the assessment can be made 8.10 at any time. The assessment may be appealed administratively 8.11 and judicially. The commissioner may take action to collect the 8.12 assessment in the same manner as provided by Minnesota Statutes, 8.13 chapter 289A, for any other order of the commissioner assessing 8.14 tax. 8.15 (q) Notwithstanding Minnesota Statutes, sections 9.031, 8.16 16A.40, 16B.49, 16B.50, and any other law to the contrary, the 8.17 commissioner of revenue may take whatever actions the 8.18 commissioner deems necessary to pay the rebates required by this 8.19 section, and may, in consultation with the commissioner of 8.20 finance and the state treasurer, contract with a private vendor 8.21 or vendors to process, print, and mail the rebate checks or 8.22 warrants required under this section and receive and disburse 8.23 state funds to pay those checks or warrants. 8.24 (r) The commissioner may make payment of rebates required 8.25 by this section by electronic funds transfer to those 8.26 individuals who requested that their 1998 individual income tax 8.27 refund be paid through electronic funds transfer. The 8.28 commissioner may make the electronic funds transfer payments to 8.29 the same financial institution and into the same account as the 8.30 1998 individual income tax refund. 8.31 Sec. 3. [APPROPRIATIONS.] 8.32 $1,000,000 is appropriated from the general fund to the 8.33 commissioner of revenue to administer the sales tax rebate for 8.34 fiscal year 1999. Any unencumbered balance remaining on June 8.35 30, 1999, does not cancel but is available for expenditure by 8.36 the commissioner of revenue until June 30, 2001. 9.1 Sec. 4. [EFFECTIVE DATE.] 9.2 Sections 1 to 3 are effective the day following final 9.3 enactment. 9.4 ARTICLE 2 9.5 INCOME AND FRANCHISE TAXES 9.6 Section 1. Minnesota Statutes 1998, section 16D.09, is 9.7 amended to read: 9.8 16D.09 [UNCOLLECTIBLE DEBTS.] 9.9 Subdivision 1. [GENERALLY.] When a debt is determined by a 9.10 state agency to be uncollectible, the debt may be written off by 9.11 the state agency from the state agency's financial accounting 9.12 records and no longer recognized as an account receivable for 9.13 financial reporting purposes. A debt is considered to be 9.14 uncollectible when (1) all reasonable collection efforts have 9.15 been exhausted, (2) the cost of further collection action will 9.16 exceed the amount recoverable, (3) the debt is legally without 9.17 merit or cannot be substantiated by evidence, (4) the debtor 9.18 cannot be located, (5) the available assets or income, current 9.19 or anticipated, that may be available for payment of the debt 9.20 are insufficient, (6) the debt has been discharged in 9.21 bankruptcy, (7) the applicable statute of limitations for 9.22 collection of the debt has expired, or (8) it is not in the 9.23 public interest to pursue collection of the debt. The 9.24 determination of the uncollectibility of a debt must be reported 9.25 by the state agency along with the basis for that decision as 9.26 part of its quarterly reports to the commissioner of finance. 9.27 Determining that the debt is uncollectible does not cancel the 9.28 legal obligation of the debtor to pay the debt, except in the 9.29 case of a debt related to a tax liability that is canceled by 9.30 the department of revenue. 9.31 Subd. 2. [NOTIFICATION OF ACTION BY DEPARTMENT OF 9.32 REVENUE.] When the department of revenue has determined that a 9.33 debt is uncollectible and has written off that debt as provided 9.34 in subdivision 1, the commissioner of revenue must make a 9.35 reasonable attempt to notify the debtor of that action and of 9.36 the release of any liens imposed under section 270.69 related to 10.1 that debt, within 30 days after the determination has been 10.2 reported to the commissioner of finance. 10.3 Sec. 2. Minnesota Statutes 1998, section 290.01, 10.4 subdivision 7, is amended to read: 10.5 Subd. 7. [RESIDENT.] The term "resident" means (1) any 10.6 individual domiciled in Minnesota, except that an individual is 10.7 not a "resident" for the period of time that the individual is a 10.8 "qualified individual" as defined in section 911(d)(1) of the 10.9 Internal Revenue Code, if the qualified individual notifies the 10.10 county within three months of moving out of the country that 10.11 homestead status be revoked for the Minnesota residence of the 10.12 qualified individual, and the property is not classified as a 10.13 homestead while the individual remains a qualified individual; 10.14 and (2) any individual domiciled outside the state who maintains 10.15 a place of abode in the state and spends in the aggregate more 10.16 than one-half of the tax year in Minnesota, unless the 10.17 individual or the spouse of the individual is in the armed 10.18 forces of the United States, or the individual is covered under 10.19 the reciprocity provisions in section 290.081. 10.20 For purposes of this subdivision, presence within the state 10.21 for any part of a calendar day constitutes a day spent in the 10.22 state. Individuals shall keep adequate records to substantiate 10.23 the days spent outside the state. 10.24 The term "abode" means a dwelling maintained by an 10.25 individual, whether or not owned by the individual and whether 10.26 or not occupied by the individual, and includes a dwelling place 10.27 owned or leased by the individual's spouse. 10.28 Neither the commissioner nor any court shall consider 10.29 charitable contributions made by an individual within or without 10.30 the state in determining if the individual is domiciled in 10.31 Minnesota. 10.32 Sec. 3. Minnesota Statutes 1998, section 290.01, 10.33 subdivision 19b, is amended to read: 10.34 Subd. 19b. [SUBTRACTIONS FROM FEDERAL TAXABLE INCOME.] For 10.35 individuals, estates, and trusts, there shall be subtracted from 10.36 federal taxable income: 11.1 (1) interest income on obligations of any authority, 11.2 commission, or instrumentality of the United States to the 11.3 extent includable in taxable income for federal income tax 11.4 purposes but exempt from state income tax under the laws of the 11.5 United States; 11.6 (2) if included in federal taxable income, the amount of 11.7 any overpayment of income tax to Minnesota or to any other 11.8 state, for any previous taxable year, whether the amount is 11.9 received as a refund or as a credit to another taxable year's 11.10 income tax liability; 11.11 (3) the amount paid to others, less the credit allowed 11.12 under section 290.0674, not to exceed $1,625 for each dependent 11.13 in grades kindergarten to 6 and $2,500 for each dependent in 11.14 grades 7 to 12, for tuition, textbooks, and transportation of 11.15 each dependent in attending an elementary or secondary school 11.16 situated in Minnesota, North Dakota, South Dakota, Iowa, or 11.17 Wisconsin, wherein a resident of this state may legally fulfill 11.18 the state's compulsory attendance laws, which is not operated 11.19 for profit, and which adheres to the provisions of the Civil 11.20 Rights Act of 1964 and chapter 363. For the purposes of this 11.21 clause, "tuition" includes fees or tuition as defined in section 11.22 290.0674, subdivision 1, clause (1). As used in this clause, 11.23 "textbooks" includes books and other instructional materials and 11.24 equipment used in elementary and secondary schools in teaching 11.25 only those subjects legally and commonly taught in public 11.26 elementary and secondary schools in this state. Equipment 11.27 expenses qualifying for deduction includes expenses as defined 11.28 and limited in section 290.0674, subdivision 1, clause (3). 11.29 "Textbooks" does not include instructional books and materials 11.30 used in the teaching of religious tenets, doctrines, or worship, 11.31 the purpose of which is to instill such tenets, doctrines, or 11.32 worship, nor does it include books or materials for, or 11.33 transportation to, extracurricular activities including sporting 11.34 events, musical or dramatic events, speech activities, driver's 11.35 education, or similar programs; 11.36 (4) to the extent included in federal taxable income, 12.1 distributions from a qualified governmental pension plan, an 12.2 individual retirement account, simplified employee pension, or 12.3 qualified plan covering a self-employed person that represent a 12.4 return of contributions that were included in Minnesota gross 12.5 income in the taxable year for which the contributions were made 12.6 but were deducted or were not included in the computation of 12.7 federal adjusted gross income. The distribution shall be 12.8 allocated first to return of contributions until the 12.9 contributions included in Minnesota gross income have been 12.10 exhausted. This subtraction applies only to contributions made 12.11 in a taxable year prior to 1985; 12.12 (5) income as provided under section 290.0802; 12.13 (6) the amount of unrecovered accelerated cost recovery 12.14 system deductions allowed under subdivision 19g; 12.15 (7) to the extent included in federal adjusted gross 12.16 income, income realized on disposition of property exempt from 12.17 tax under section 290.491; 12.18 (8) to the extent not deducted in determining federal 12.19 taxable income, the amount paid for health insurance of 12.20 self-employed individuals as determined under section 162(l) of 12.21 the Internal Revenue Code, except that the 25 percent limit does 12.22 not apply. If the taxpayer deducted insurance payments under 12.23 section 213 of the Internal Revenue Code of 1986, the 12.24 subtraction under this clause must be reduced by the lesser of: 12.25 (i) the total itemized deductions allowed under section 12.26 63(d) of the Internal Revenue Code, less state, local, and 12.27 foreign income taxes deductible under section 164 of the 12.28 Internal Revenue Code and the standard deduction under section 12.29 63(c) of the Internal Revenue Code; or 12.30 (ii) the lesser of (A) the amount of insurance qualifying 12.31 as "medical care" under section 213(d) of the Internal Revenue 12.32 Code to the extent not deducted under section 162(1) of the 12.33 Internal Revenue Code or excluded from income or (B) the total 12.34 amount deductible for medical care under section 213(a); 12.35 (9) the exemption amount allowed under Laws 1995, chapter 12.36 255, article 3, section 2, subdivision 3; 13.1 (10) to the extent included in federal taxable income, 13.2 postservice benefits for youth community service under section 13.3 124D.42 for volunteer service under United States Code, title 13.4 42, section 5011(d), as amended; 13.5 (11) to the extent not subtracted under clause (1), the 13.6 amount of income or gain included in federal taxable income 13.7 under section 1366 of the Internal Revenue Code flowing from a 13.8 corporation that has a valid election in effect for the taxable 13.9 year under section 1362 of the Internal Revenue Code which is 13.10 not allowed to be an "S" corporation under section 290.9725; 13.11 (12) in the year stock of a corporation that had made a 13.12 valid election under section 1362 of the Internal Revenue Code 13.13 but was not an "S" corporation under section 290.9725 is sold or 13.14 disposed of in a transaction taxable under the Internal Revenue 13.15 Code, the amount of difference between the Minnesota basis of 13.16 the stock under subdivision 19f, paragraph (m), and the federal 13.17 basis if the Minnesota basis is higher than the shareholder's 13.18 federal basis;and13.19 (13) an amount equal to an individual's, trust's, or 13.20 estate's net federal income tax liability for the tax year that 13.21 is attributable to items of income, expense, gain, loss, or 13.22 credits federally flowing to the taxpayer in the tax year from a 13.23 corporation, having a valid election in effect for federal tax 13.24 purposes under section 1362 of the Internal Revenue Code but not 13.25 treated as an "S" corporation for state tax purposes under 13.26 section 290.9725; and 13.27 (14) to the extent included in federal taxable income, 13.28 holocaust victims' settlement payments for any injury incurred 13.29 as a result of the holocaust, if received by an individual who 13.30 was persecuted for racial or religious reasons by Nazi Germany 13.31 or any other Axis regime or an heir of such a person. 13.32 Sec. 4. Minnesota Statutes 1998, section 290.01, is 13.33 amended by adding a subdivision to read: 13.34 Subd. 32. [HOLOCAUST SETTLEMENT PAYMENTS.] "Holocaust 13.35 victims' settlement payments" means: 13.36 (1) a payment received as a result of settlement of the 14.1 action entitled In re Holocaust Victims' Asset Litigation, in 14.2 United States district court for the eastern district of New 14.3 York, C.A. No. 96-4849; 14.4 (2) any amount received under the German Act Regulating 14.5 Unresolved Property Claims or any other foreign law providing 14.6 for payments for holocaust claims; and 14.7 (3) a payment received as a result of the settlement of a 14.8 holocaust claim not described in clause (1) or (2), including an 14.9 insurance claim, a claim relating to looted art or financial 14.10 assets, and a claim relating to slave labor wages. 14.11 Sec. 5. Minnesota Statutes 1998, section 290.06, 14.12 subdivision 2c, is amended to read: 14.13 Subd. 2c. [SCHEDULES OF RATES FOR INDIVIDUALS, ESTATES, 14.14 AND TRUSTS.] (a) The income taxes imposed by this chapter upon 14.15 married individuals filing joint returns and surviving spouses 14.16 as defined in section 2(a) of the Internal Revenue Code must be 14.17 computed by applying to their taxable net income the following 14.18 schedule of rates: 14.19 (1) On the first$19,910$29,930,65.5 percent; 14.20 (2) On all over$19,910$29,930, but not 14.21 over$79,120$100,200,87.5 percent; 14.22 (3) On all over$79,120$100,200, 8.5 percent. 14.23 Married individuals filing separate returns, estates, and 14.24 trusts must compute their income tax by applying the above rates 14.25 to their taxable income, except that the income brackets will be 14.26 one-half of the above amounts. 14.27 (b) The income taxes imposed by this chapter upon unmarried 14.28 individuals must be computed by applying to taxable net income 14.29 the following schedule of rates: 14.30 (1) On the first$13,620$17,250,65.5 percent; 14.31 (2) On all over$13,620$17,250, but not 14.32 over$44,750$56,680,87.5 percent; 14.33 (3) On all over$44,750$56,680, 8.5 percent. 14.34 (c) The income taxes imposed by this chapter upon unmarried 14.35 individuals qualifying as a head of household as defined in 14.36 section 2(b) of the Internal Revenue Code must be computed by 15.1 applying to taxable net income the following schedule of rates: 15.2 (1) On the first$16,770$21,240,65.5 percent; 15.3 (2) On all over$16,770$21,240, but not 15.4 over$67,390$85,350,87.5 percent; 15.5 (3) On all over$67,390$85,350, 8.5 percent. 15.6 (d) In lieu of a tax computed according to the rates set 15.7 forth in this subdivision, the tax of any individual taxpayer 15.8 whose taxable net income for the taxable year is less than an 15.9 amount determined by the commissioner must be computed in 15.10 accordance with tables prepared and issued by the commissioner 15.11 of revenue based on income brackets of not more than $100. The 15.12 amount of tax for each bracket shall be computed at the rates 15.13 set forth in this subdivision, provided that the commissioner 15.14 may disregard a fractional part of a dollar unless it amounts to 15.15 50 cents or more, in which case it may be increased to $1. 15.16 (e) An individual who is not a Minnesota resident for the 15.17 entire year must compute the individual's Minnesota income tax 15.18 as provided in this subdivision. After the application of the 15.19 nonrefundable credits provided in this chapter, the tax 15.20 liability must then be multiplied by a fraction in which: 15.21 (1) the numerator is the individual's Minnesota source 15.22 federal adjusted gross income as defined in section 62 of the 15.23 Internal Revenue Code disregarding income or loss flowing from a 15.24 corporation having a valid election for the taxable year under 15.25 section 1362 of the Internal Revenue Code but which is not an 15.26 "S" corporation under section 290.9725 and increased by the 15.27 additions required under section 290.01, subdivision 19a, 15.28 clauses (1) and (9), after applying the allocation and 15.29 assignability provisions of section 290.081, clause (a), or 15.30 290.17; and 15.31 (2) the denominator is the individual's federal adjusted 15.32 gross income as defined in section 62 of the Internal Revenue 15.33 Code of 1986, increased by the amounts specified in section 15.34 290.01, subdivision 19a, clauses (1), (5), (6), (7), and (9), 15.35 and reduced by the amounts specified in section 290.01, 15.36 subdivision 19b, clauses (1), (11), and (12). 16.1 Sec. 6. Minnesota Statutes 1998, section 290.06, 16.2 subdivision 2d, is amended to read: 16.3 Subd. 2d. [INFLATION ADJUSTMENT OF BRACKETS.] (a) For 16.4 taxable years beginning after December 31,19911999, the 16.5 minimum and maximum dollar amounts for each rate bracket for 16.6 which a tax is imposed in subdivision 2c shall be adjusted for 16.7 inflation by the percentage determined under paragraph (b). For 16.8 the purpose of making the adjustment as provided in this 16.9 subdivision all of the rate brackets provided in subdivision 2c 16.10 shall be the rate brackets as they existed for taxable years 16.11 beginning after December 31,19901998, and before January 16.12 1,19922000. The rate applicable to any rate bracket must not 16.13 be changed. The dollar amounts setting forth the tax shall be 16.14 adjusted to reflect the changes in the rate brackets. The rate 16.15 brackets as adjusted must be rounded to the nearest $10 amount. 16.16 If the rate bracket ends in $5, it must be rounded up to the 16.17 nearest $10 amount. 16.18 (b) The commissioner shall adjust the rate brackets and by 16.19 the percentage determined pursuant to the provisions of section 16.20 1(f) of the Internal Revenue Code, except that in section 16.21 1(f)(3)(B) the word "19901998" shall be substituted for the 16.22 word "19871992." For19911999, the commissioner shall then 16.23 determine the percent change from the 12 months ending on August 16.24 31,19901998, to the 12 months ending on August 31,19911999, 16.25 and in each subsequent year, from the 12 months ending on August 16.26 31,19901999, to the 12 months ending on August 31 of the year 16.27 preceding the taxable year. The determination of the 16.28 commissioner pursuant to this subdivision shall not be 16.29 considered a "rule" and shall not be subject to the 16.30 Administrative Procedure Act contained in chapter 14. 16.31 No later than December 15 of each year, the commissioner 16.32 shall announce the specific percentage that will be used to 16.33 adjust the tax rate brackets. 16.34 Sec. 7. Minnesota Statutes 1998, section 290.0671, 16.35 subdivision 1, is amended to read: 16.36 Subdivision 1. [CREDIT ALLOWED.] (a) An individual is 17.1 allowed a credit against the tax imposed by this chapter equal 17.2 to a percentage of earned income. To receive a credit, a 17.3 taxpayer must be eligible for a credit under section 32 of the 17.4 Internal Revenue Code. 17.5 (b) For individuals with no qualifying children, the credit 17.6 equals 1.1475 percent of the first $4,460 of earned income. The 17.7 credit is reduced by 1.1475 percent of earned income or modified 17.8 adjusted gross income, whichever is greater, in excess of 17.9 $5,570, but in no case is the credit less than zero. 17.10 (c) For individuals with one qualifying child, the credit 17.11 equals6.87.45 percent of the first $6,680 of earned income and 17.12 8.5 percent of earned income over $11,650 but less than 17.13 $12,990. The credit is reduced by4.775.13 percent of earned 17.14 income or modified adjusted gross income, whichever is greater, 17.15 in excess of $14,560, but in no case is the credit less than 17.16 zero. 17.17 (d) For individuals with two or more qualifying children, 17.18 the credit equalseight8.8 percent of the first $9,390 of 17.19 earned income and 20 percent of earned income over $14,350 but 17.20 less than $16,230. The credit is reduced by8.89.38 percent of 17.21 earned income or modified adjusted gross income, whichever is 17.22 greater, in excess of $17,280, but in no case is the credit less 17.23 than zero. 17.24 (e) For a nonresident or part-year resident, the credit 17.25 must be allocated based on the percentage calculated under 17.26 section 290.06, subdivision 2c, paragraph (e). 17.27 (f) For a person who was a resident for the entire tax year 17.28 and has earned income not subject to tax under this chapter, the 17.29 credit must be allocated based on the ratio of federal adjusted 17.30 gross income reduced by the earned income not subject to tax 17.31 under this chapter over federal adjusted gross income. 17.32 Sec. 8. Minnesota Statutes 1998, section 290.091, 17.33 subdivision 2, is amended to read: 17.34 Subd. 2. [DEFINITIONS.] For purposes of the tax imposed by 17.35 this section, the following terms have the meanings given: 17.36 (a) "Alternative minimum taxable income" means the sum of 18.1 the following for the taxable year: 18.2 (1) the taxpayer's federal alternative minimum taxable 18.3 income as defined in section 55(b)(2) of the Internal Revenue 18.4 Code; 18.5 (2) the taxpayer's itemized deductions allowed in computing 18.6 federal alternative minimum taxable income, but excluding: 18.7 (i) the Minnesota charitable contribution deduction; 18.8 (ii) the medical expense deduction; 18.9 (iii) the casualty, theft, and disaster loss deduction;and18.10 (iv) the impairment-related work expenses of a disabled 18.11 person; and 18.12 (v) holocaust victims' settlement payments to the extent 18.13 allowed under section 290.01, subdivision 19b; and 18.14 (3) for depletion allowances computed under section 613A(c) 18.15 of the Internal Revenue Code, with respect to each property (as 18.16 defined in section 614 of the Internal Revenue Code), to the 18.17 extent not included in federal alternative minimum taxable 18.18 income, the excess of the deduction for depletion allowable 18.19 under section 611 of the Internal Revenue Code for the taxable 18.20 year over the adjusted basis of the property at the end of the 18.21 taxable year (determined without regard to the depletion 18.22 deduction for the taxable year); 18.23 (4) to the extent not included in federal alternative 18.24 minimum taxable income, the amount of the tax preference for 18.25 intangible drilling cost under section 57(a)(2) of the Internal 18.26 Revenue Code determined without regard to subparagraph (E); 18.27 (5) to the extent not included in federal alternative 18.28 minimum taxable income, the amount of interest income as 18.29 provided by section 290.01, subdivision 19a, clause (1); 18.30 (6) amounts added to federal taxable income as provided by 18.31 section 290.01, subdivision 19a, clauses (5), (6), and (7); 18.32 less the sum of theamounts determined under thefollowing 18.33clauses (1) to (4): 18.34 (1) interest income as defined in section 290.01, 18.35 subdivision 19b, clause (1); 18.36 (2) an overpayment of state income tax as provided by 19.1 section 290.01, subdivision 19b, clause (2), to the extent 19.2 included in federal alternative minimum taxable income; 19.3 (3) the amount of investment interest paid or accrued 19.4 within the taxable year on indebtedness to the extent that the 19.5 amount does not exceed net investment income, as defined in 19.6 section 163(d)(4) of the Internal Revenue Code. Interest does 19.7 not include amounts deducted in computing federal adjusted gross 19.8 income; and 19.9 (4) amounts subtracted from federal taxable income as 19.10 provided by section 290.01, subdivision 19b, clauses (11) and 19.11 (12). 19.12 In the case of an estate or trust, alternative minimum 19.13 taxable income must be computed as provided in section 59(c) of 19.14 the Internal Revenue Code. 19.15 (b) "Investment interest" means investment interest as 19.16 defined in section 163(d)(3) of the Internal Revenue Code. 19.17 (c) "Tentative minimum tax" equals seven percent of 19.18 alternative minimum taxable income after subtracting the 19.19 exemption amount determined under subdivision 3. 19.20 (d) "Regular tax" means the tax that would be imposed under 19.21 this chapter (without regard to this section and section 19.22 290.032), reduced by the sum of the nonrefundable credits 19.23 allowed under this chapter. 19.24 (e) "Net minimum tax" means the minimum tax imposed by this 19.25 section. 19.26 (f) "Minnesota charitable contribution deduction" means a 19.27 charitable contribution deduction under section 170 of the 19.28 Internal Revenue Code to or for the use of an entity described 19.29 in section 290.21, subdivision 3, clauses (a) to (e). When the 19.30 federal deduction for charitable contributions is limited under 19.31 section 170(b) of the Internal Revenue Code, the allowable 19.32 contributions in the year of contribution are deemed to be first 19.33 contributions to entities described in section 290.21, 19.34 subdivision 3, clauses (a) to (e). 19.35 Sec. 9. Minnesota Statutes 1998, section 290.17, 19.36 subdivision 3, is amended to read: 20.1 Subd. 3. [TRADE ORBUSINESS INCOME; GENERAL RULE.] All 20.2 income of a unitary business is subject to apportionment except 20.3 nonbusiness income. Income derived fromcarrying on a trade or20.4 a unitary business must be assigned to this state if thetrade20.5orunitary business is conducted wholly within this state, 20.6 assigned outside this state if conducted wholly without this 20.7 state and apportioned between this state and other states and 20.8 countries under this subdivision if conducted partly within and 20.9 partly without this state. For purposes of determining whether 20.10 atrade orunitary business is carried on exclusively within or 20.11 without this state: 20.12 (a) Atrade orunitary business physically located 20.13 exclusively within this state is nevertheless carried on partly 20.14 within and partly without this state if any of the principles 20.15 set forth in section 290.191 for the allocation of sales or 20.16 receipts within or without this state when applied to the 20.17 taxpayer's situation result in the allocation of any sales or 20.18 receipts without this state. 20.19 (b) Atrade orunitary business physically located 20.20 exclusively without this state is nevertheless carried on partly 20.21 within and partly without this state if any of the principles 20.22 set forth in section 290.191 for the allocation of sales or 20.23 receipts within or without this state when applied to the 20.24 taxpayer's situation result in the allocation of any sales or 20.25 receipts without this state. The jurisdiction to tax such a 20.26 business under this chapter must be determined in accordance 20.27 with sections 290.014 and 290.015. 20.28 Sec. 10. Minnesota Statutes 1998, section 290.17, 20.29 subdivision 4, is amended to read: 20.30 Subd. 4. [UNITARY BUSINESS PRINCIPLE.] (a) If a trade or 20.31 business conducted wholly within this state or partly within and 20.32 partly without this state is part of a unitary business, the 20.33 entire income of the unitary business is subject to 20.34 apportionment pursuant to section 290.191. Notwithstanding 20.35 subdivision 2, paragraph (c), none of the income of a unitary 20.36 business is considered to be derived from any particular source 21.1 and none may be allocated to a particular place except as 21.2 provided by the applicable apportionment formula. The 21.3 provisions of this subdivision do not apply to farm income 21.4 subject to subdivision 5, paragraph (a), business income subject 21.5 to subdivision 5, paragraph (b) or (c), income of an insurance 21.6 company determined under section 290.35, or income of an 21.7 investment company determined under section 290.36. 21.8 (b) The term "unitary business" means business activities 21.9 or operations whichare of mutual benefit, dependent upon, or21.10contributory to one another, individually or as a groupresult 21.11 in a flow of value between them. The term may be applied within 21.12 a single legal entity or between multiple entities and without 21.13 regard to whether each entity is a sole proprietorship, a 21.14 corporation, a partnership or a trust. 21.15 (c) Unity is presumed whenever there is unity of ownership, 21.16 operation, and use, evidenced by centralized management or 21.17 executive force, centralized purchasing, advertising, 21.18 accounting, or other controlled interaction, but the absence of 21.19 these centralized activities will not necessarily evidence a 21.20 nonunitary business. Unity is also presumed when business 21.21 activities or operations are of mutual benefit, dependent upon 21.22 or contributory to one another, either individually or as a 21.23 group. 21.24 (d) Where a business operation conducted in Minnesota is 21.25 owned by a business entity that carries on business activity 21.26 outside the state different in kind from that conducted within 21.27 this state, and the other business is conducted entirely outside 21.28 the state, it is presumed that the two business operations are 21.29 unitary in nature, interrelated, connected, and interdependent 21.30 unless it can be shown to the contrary. 21.31 (e) Unity of ownership is not deemed to exist when a 21.32 corporation is involved unless that corporation is a member of a 21.33 group of two or more business entities and more than 50 percent 21.34 of the voting stock of each member of the group is directly or 21.35 indirectly owned by a common owner or by common owners, either 21.36 corporate or noncorporate, or by one or more of the member 22.1 corporations of the group. For this purpose, the term "voting 22.2 stock" shall include membership interests of mutual insurance 22.3 holding companies formed under section 60A.077. 22.4 (f) The net income and apportionment factors under section 22.5 290.191 or 290.20 of foreign corporations and other foreign 22.6 entities which are part of a unitary business shall not be 22.7 included in the net income or the apportionment factors of the 22.8 unitary business. A foreign corporation or other foreign entity 22.9 which is required to file a return under this chapter shall file 22.10 on a separate return basis. The net income and apportionment 22.11 factors under section 290.191 or 290.20 of foreign operating 22.12 corporations shall not be included in the net income or the 22.13 apportionment factors of the unitary business except as provided 22.14 in paragraph (g). 22.15 (g) The adjusted net income of a foreign operating 22.16 corporation shall be deemed to be paid as a dividend on the last 22.17 day of its taxable year to each shareholder thereof, in 22.18 proportion to each shareholder's ownership, with which such 22.19 corporation is engaged in a unitary business. Such deemed 22.20 dividend shall be treated as a dividend under section 290.21, 22.21 subdivision 4. 22.22 Dividends actually paid by a foreign operating corporation 22.23 to a corporate shareholder which is a member of the same unitary 22.24 business as the foreign operating corporation shall be 22.25 eliminated from the net income of the unitary business in 22.26 preparing a combined report for the unitary business. The 22.27 adjusted net income of a foreign operating corporation shall be 22.28 its net income adjusted as follows: 22.29 (1) any taxes paid or accrued to a foreign country, the 22.30 commonwealth of Puerto Rico, or a United States possession or 22.31 political subdivision of any of the foregoing shall be a 22.32 deduction; and 22.33 (2) the subtraction from federal taxable income for 22.34 payments received from foreign corporations or foreign operating 22.35 corporations under section 290.01, subdivision 19d, clause (11), 22.36 shall not be allowed. 23.1 If a foreign operating corporation incurs a net loss, 23.2 neither income nor deduction from that corporation shall be 23.3 included in determining the net income of the unitary business. 23.4 (h) For purposes of determining the net income of a unitary 23.5 business and the factors to be used in the apportionment of net 23.6 income pursuant to section 290.191 or 290.20, there must be 23.7 included only the income and apportionment factors of domestic 23.8 corporations or other domestic entities other than foreign 23.9 operating corporations that are determined to be part of the 23.10 unitary business pursuant to this subdivision, notwithstanding 23.11 that foreign corporations or other foreign entities might be 23.12 included in the unitary business. 23.13 (i) Deductions for expenses, interest, or taxes otherwise 23.14 allowable under this chapter that are connected with or 23.15 allocable against dividends, deemed dividends described in 23.16 paragraph (g), or royalties, fees, or other like income 23.17 described in section 290.01, subdivision 19d, clause (11), shall 23.18 not be disallowed. 23.19 (j) Each corporation or other entity, except a sole 23.20 proprietorship, that is part of a unitary business must file 23.21 combined reports as the commissioner determines. On the 23.22 reports, all intercompany transactions between entities included 23.23 pursuant to paragraph (h) must be eliminated and the entire net 23.24 income of the unitary business determined in accordance with 23.25 this subdivision is apportioned among the entities by using each 23.26 entity's Minnesota factors for apportionment purposes in the 23.27 numerators of the apportionment formula and the total factors 23.28 for apportionment purposes of all entities included pursuant to 23.29 paragraph (h) in the denominators of the apportionment formula. 23.30 (k) If a corporation has been divested from a unitary 23.31 business and is included in a combined report for a fractional 23.32 part of the common accounting period of the combined report: 23.33 (1) its income includable in the combined report is its 23.34 income incurred for that part of the year determined by 23.35 proration or separate accounting; and 23.36 (2) its sales, property, and payroll included in the 24.1 apportionment formula must be prorated or accounted for 24.2 separately. 24.3 Sec. 11. Minnesota Statutes 1998, section 290.17, 24.4 subdivision 6, is amended to read: 24.5 Subd. 6. [NONBUSINESS INCOME.]For a trade or business for24.6which allocation of income within and without this state is24.7required, if the taxpayer has any income not connected with the24.8trade or business carried on partly within and partly without24.9this state that income must be allocated under subdivision 2.24.10Intangible property is employed in a trade or business if the24.11owner of the property holds it as a means of furthering the24.12trade or business.Nonbusiness income is income of the unitary 24.13 business that cannot be apportioned by this state because of the 24.14 United States Constitution or the constitution of the state of 24.15 Minnesota and includes income that is derived from a capital 24.16 transaction that serves an investment function. Nonbusiness 24.17 income must be allocated under subdivision 2. 24.18 Sec. 12. [NONBUSINESS INCOME; LIMITATION ON ASSESSMENT OF 24.19 TAX.] 24.20 If all items of income, gain, or loss are reported by a 24.21 taxpayer as business income or loss on an original or amended 24.22 return for a tax year to which this section applies, the 24.23 commissioner of revenue shall not adjust the tax liability for 24.24 that tax year, or for any other tax year affected by a carryover 24.25 from that tax year, by treating any of the items as nonbusiness 24.26 income or loss under Minnesota Statutes, section 290.17, 24.27 subdivision 6. Any adjustment treating an item as nonbusiness 24.28 income or loss ordered by the commissioner before the effective 24.29 date of this section must be reversed if the order is subject to 24.30 administrative or judicial challenge on the effective date and 24.31 such a challenge is timely filed. The reporting of any item as 24.32 nonbusiness income, gain, or loss does not preclude the 24.33 application of this section if the taxpayer may not 24.34 constitutionally be required to treat the item as business 24.35 income, gain, or loss. 24.36 Sec. 13. [EFFECTIVE DATE.] 25.1 (a) Section 1 applies to claims written off after June 30, 25.2 1999. 25.3 (b) Section 2 is intended to clarify rather than to change 25.4 the definition of resident, and is effective for all 25.5 examinations, claims for refund, administrative appeals, and 25.6 court proceedings that are pending or begin on or after the day 25.7 following final enactment. 25.8 (c) Sections 3, 4, 5, 7, 8, 9, 10, and 11 are effective for 25.9 taxable years beginning after December 31, 1998. 25.10 (d) Section 12 is effective for tax years beginning before 25.11 January 1, 1999. 25.12 ARTICLE 3 25.13 FEDERAL UPDATE 25.14 Section 1. Minnesota Statutes 1998, section 289A.02, 25.15 subdivision 7, is amended to read: 25.16 Subd. 7. [INTERNAL REVENUE CODE.] Unless specifically 25.17 defined otherwise, "Internal Revenue Code" means the Internal 25.18 Revenue Code of 1986, as amended through December 31,19971998. 25.19 Sec. 2. Minnesota Statutes 1998, section 290.01, 25.20 subdivision 19, is amended to read: 25.21 Subd. 19. [NET INCOME.] The term "net income" means the 25.22 federal taxable income, as defined in section 63 of the Internal 25.23 Revenue Code of 1986, as amended through the date named in this 25.24 subdivision, incorporating any elections made by the taxpayer in 25.25 accordance with the Internal Revenue Code in determining federal 25.26 taxable income for federal income tax purposes, and with the 25.27 modifications provided in subdivisions 19a to 19f. 25.28 In the case of a regulated investment company or a fund 25.29 thereof, as defined in section 851(a) or 851(g) of the Internal 25.30 Revenue Code, federal taxable income means investment company 25.31 taxable income as defined in section 852(b)(2) of the Internal 25.32 Revenue Code, except that: 25.33 (1) the exclusion of net capital gain provided in section 25.34 852(b)(2)(A) of the Internal Revenue Code does not apply; 25.35 (2) the deduction for dividends paid under section 25.36 852(b)(2)(D) of the Internal Revenue Code must be applied by 26.1 allowing a deduction for capital gain dividends and 26.2 exempt-interest dividends as defined in sections 852(b)(3)(C) 26.3 and 852(b)(5) of the Internal Revenue Code; and 26.4 (3) the deduction for dividends paid must also be applied 26.5 in the amount of any undistributed capital gains which the 26.6 regulated investment company elects to have treated as provided 26.7 in section 852(b)(3)(D) of the Internal Revenue Code. 26.8 The net income of a real estate investment trust as defined 26.9 and limited by section 856(a), (b), and (c) of the Internal 26.10 Revenue Code means the real estate investment trust taxable 26.11 income as defined in section 857(b)(2) of the Internal Revenue 26.12 Code. 26.13 The net income of a designated settlement fund as defined 26.14 in section 468B(d) of the Internal Revenue Code means the gross 26.15 income as defined in section 468B(b) of the Internal Revenue 26.16 Code. 26.17 The Internal Revenue Code of 1986, as amended through 26.18 December 31, 1986, shall be in effect for taxable years 26.19 beginning after December 31, 1986. The provisions of sections 26.20 10104, 10202, 10203, 10204, 10206, 10212, 10221, 10222, 10223, 26.21 10226, 10227, 10228, 10611, 10631, 10632, and 10711 of the 26.22 Omnibus Budget Reconciliation Act of 1987, Public Law Number 26.23 100-203, the provisions of sections 1001, 1002, 1003, 1004, 26.24 1005, 1006, 1008, 1009, 1010, 1011, 1011A, 1011B, 1012, 1013, 26.25 1014, 1015, 1018, 2004, 3041, 4009, 6007, 6026, 6032, 6137, 26.26 6277, and 6282 of the Technical and Miscellaneous Revenue Act of 26.27 1988, Public Law Number 100-647, the provisions of sections 26.28 7811, 7816, and 7831 of the Omnibus Budget Reconciliation Act of 26.29 1989, Public Law Number 101-239, the provisions of sections 26.30 1305, 1704(r), and 1704(e)(1) of the Small Business Job 26.31 Protection Act, Public Law Number 104-188, and the provisions of 26.32 sections 975 and 1604(d)(2) and (e) of the Taxpayer Relief Act 26.33 of 1997, Public Law Number 105-34, and the provisions of section 26.34 4004 of the Omnibus Consolidated and Emergency Supplemental 26.35 Appropriations Act, 1999, Public Law Number 105-277 shall be 26.36 effective at the time they become effective for federal income 27.1 tax purposes. 27.2 The Internal Revenue Code of 1986, as amended through 27.3 December 31, 1987, shall be in effect for taxable years 27.4 beginning after December 31, 1987. The provisions of sections 27.5 4001, 4002, 4011, 5021, 5041, 5053, 5075, 6003, 6008, 6011, 27.6 6030, 6031, 6033, 6057, 6064, 6066, 6079, 6130, 6176, 6180, 27.7 6182, 6280, and 6281 of the Technical and Miscellaneous Revenue 27.8 Act of 1988, Public Law Number 100-647, the provisions of 27.9 sections 7815 and 7821 of the Omnibus Budget Reconciliation Act 27.10 of 1989, Public Law Number 101-239, and the provisions of 27.11 section 11702 of the Revenue Reconciliation Act of 1990, Public 27.12 Law Number 101-508, shall become effective at the time they 27.13 become effective for federal tax purposes. 27.14 The Internal Revenue Code of 1986, as amended through 27.15 December 31, 1988, shall be in effect for taxable years 27.16 beginning after December 31, 1988. The provisions of sections 27.17 7101, 7102, 7104, 7105, 7201, 7202, 7203, 7204, 7205, 7206, 27.18 7207, 7210, 7211, 7301, 7302, 7303, 7304, 7601, 7621, 7622, 27.19 7641, 7642, 7645, 7647, 7651, and 7652 of the Omnibus Budget 27.20 Reconciliation Act of 1989, Public Law Number 101-239, the 27.21 provision of section 1401 of the Financial Institutions Reform, 27.22 Recovery, and Enforcement Act of 1989, Public Law Number 101-73, 27.23 the provisions of sections 11701 and 11703 of the Revenue 27.24 Reconciliation Act of 1990, Public Law Number 101-508, and the 27.25 provisions of sections 1702(g) and 1704(f)(2)(A) and (B) of the 27.26 Small Business Job Protection Act, Public Law Number 104-188, 27.27 shall become effective at the time they become effective for 27.28 federal tax purposes. 27.29 The Internal Revenue Code of 1986, as amended through 27.30 December 31, 1989, shall be in effect for taxable years 27.31 beginning after December 31, 1989. The provisions of sections 27.32 11321, 11322, 11324, 11325, 11403, 11404, 11410, and 11521 of 27.33 the Revenue Reconciliation Act of 1990, Public Law Number 27.34 101-508, and the provisions of sections 13224 and 13261 of the 27.35 Omnibus Budget Reconciliation Act of 1993, Public Law Number 27.36 103-66, shall become effective at the time they become effective 28.1 for federal purposes. 28.2 The Internal Revenue Code of 1986, as amended through 28.3 December 31, 1990, shall be in effect for taxable years 28.4 beginning after December 31, 1990. 28.5 The provisions of section 13431 of the Omnibus Budget 28.6 Reconciliation Act of 1993, Public Law Number 103-66, shall 28.7 become effective at the time they became effective for federal 28.8 purposes. 28.9 The Internal Revenue Code of 1986, as amended through 28.10 December 31, 1991, shall be in effect for taxable years 28.11 beginning after December 31, 1991. 28.12 The provisions of sections 1936 and 1937 of the 28.13 Comprehensive National Energy Policy Act of 1992, Public Law 28.14 Number 102-486, the provisions of sections 13101, 13114, 13122, 28.15 13141, 13150, 13151, 13174, 13239, 13301, and 13442 of the 28.16 Omnibus Budget Reconciliation Act of 1993, Public Law Number 28.17 103-66, and the provisions of section 1604(a)(1), (2), and (3) 28.18 of the Taxpayer Relief Act of 1997, Public Law Number 105-34, 28.19 shall become effective at the time they become effective for 28.20 federal purposes. 28.21 The Internal Revenue Code of 1986, as amended through 28.22 December 31, 1992, shall be in effect for taxable years 28.23 beginning after December 31, 1992. 28.24 The provisions of sections 13116, 13121, 13206, 13210, 28.25 13222, 13223, 13231, 13232, 13233, 13239, 13262, and 13321 of 28.26 the Omnibus Budget Reconciliation Act of 1993, Public Law Number 28.27 103-66, the provisions of sections 1703(a), 1703(d), 1703(i), 28.28 1703(l), and 1703(m) of the Small Business Job Protection Act, 28.29 Public Law Number 104-188, and the provision of section 1604(c) 28.30 of the Taxpayer Relief Act of 1997, Public Law Number 105-34, 28.31 shall become effective at the time they become effective for 28.32 federal purposes. 28.33 The Internal Revenue Code of 1986, as amended through 28.34 December 31, 1993, shall be in effect for taxable years 28.35 beginning after December 31, 1993. 28.36 The provision of section 741 of Legislation to Implement 29.1 Uruguay Round of General Agreement on Tariffs and Trade, Public 29.2 Law Number 103-465, the provisions of sections 1, 2, and 3, of 29.3 the Self-Employed Health Insurance Act of 1995, Public Law 29.4 Number 104-7, the provision of section 501(b)(2) of the Health 29.5 Insurance Portability and Accountability Act, Public Law Number 29.6 104-191, the provisions of sections 1604 and 1704(p)(1) and (2) 29.7 of the Small Business Job Protection Act, Public Law Number 29.8 104-188, and the provisions of sections 1011, 1211(b)(1), and 29.9 1602(f) of the Taxpayer Relief Act of 1997, Public Law Number 29.10 105-34, shall become effective at the time they become effective 29.11 for federal purposes. 29.12 The Internal Revenue Code of 1986, as amended through 29.13 December 31, 1994, shall be in effect for taxable years 29.14 beginning after December 31, 1994. 29.15 The provisions of sections 1119(a), 1120, 1121, 1202(a), 29.16 1444, 1449(b), 1602(a), 1610(a), 1613, and 1805 of the Small 29.17 Business Job Protection Act, Public Law Number 104-188, the 29.18 provision of section 511 of the Health Insurance Portability and 29.19 Accountability Act, Public Law Number 104-191, and the 29.20 provisions of sections 1174 and 1601(i)(2) of the Taxpayer 29.21 Relief Act of 1997, Public Law Number 105-34, shall become 29.22 effective at the time they become effective for federal purposes. 29.23 The Internal Revenue Code of 1986, as amended through March 29.24 22, 1996, is in effect for taxable years beginning after 29.25 December 31, 1995. 29.26 The provisions of sections 1113(a), 1117, 1206(a), 1313(a), 29.27 1402(a), 1403(a), 1443, 1450, 1501(a), 1605, 1611(a), 1612, 29.28 1616, 1617, 1704(l), and 1704(m) of the Small Business Job 29.29 Protection Act, Public Law Number 104-188, the provisions of 29.30 Public Law Number 104-117,andthe provisions of sections 313(a) 29.31 and (b)(1), 602(a), 913(b), 941, 961, 971, 1001(a) and (b), 29.32 1002, 1003, 1012, 1013, 1014, 1061, 1062, 1081, 1084(b), 1086, 29.33 1087, 1111(a), 1131(b) and (c), 1211(b), 1213, 1530(c)(2), 29.34 1601(f)(5) and (h), and 1604(d)(1) of the Taxpayer Relief Act of 29.35 1997, Public Law Number 105-34, the provisions of section 6010 29.36 of the Internal Revenue Service Restructuring and Reform Act of 30.1 1998, Public Law Number 105-206, and the provisions of section 30.2 4003 of the Omnibus Consolidated and Emergency Supplemental 30.3 Appropriations Act, 1999, Public Law Number 105-277, shall 30.4 become effective at the time they become effective for federal 30.5 purposes. 30.6 The Internal Revenue Code of 1986, as amended through 30.7 December 31, 1996, shall be in effect for taxable years 30.8 beginning after December 31, 1996. 30.9 The provisions of sections 202(a) and (b), 221(a), 225, 30.10 312, 313, 913(a), 934, 962, 1004, 1005, 1052, 1063, 1084(a) and 30.11 (c), 1089, 1112, 1171, 1204, 1271(a) and (b), 1305(a), 1306, 30.12 1307, 1308, 1309, 1501(b), 1502(b), 1504(a), 1505, 1527, 1528, 30.13 1530, 1601(d), (e), (f), and (i) and 1602(a), (b), (c), and (e) 30.14 of the Taxpayer Relief Act of 1997, Public Law Number 30.15 105-34, the provisions of sections 6004, 6005, 6012, 6013, 6015, 30.16 6016, 7002, and 7003 of the Internal Revenue Service 30.17 Restructuring and Reform Act of 1998, Public Law Number 105-206, 30.18 and the provisions of section 3001 of the Omnibus Consolidated 30.19 and Emergency Supplemental Appropriations Act, 1999, Public Law 30.20 Number 105-277, shall become effective at the time they become 30.21 effective for federal purposes. 30.22 The Internal Revenue Code of 1986, as amended through 30.23 December 31, 1997, shall be in effect for taxable years 30.24 beginning after December 31, 1997. 30.25 The provisions of sections 5002, 6009, 6011, and 7001 of 30.26 the Internal Revenue Service Restructuring and Reform Act of 30.27 1998, Public Law Number 105-206, the provisions of section 9010 30.28 of the Transportation Equity Act for the 21st Century, Public 30.29 Law Number 105-178, the provisions of sections 1004, 4002, and 30.30 5301 of the Omnibus Consolidation and Emergency Supplemental 30.31 Appropriations Act, 1999, Public Law Number 105-277, and the 30.32 provision of section 303 of the Ricky Ray Hemophilia Relief Fund 30.33 Act of 1998, Public Law Number 105-369, shall become effective 30.34 at the time they become effective for federal purposes. 30.35 The Internal Revenue Code of 1986, as amended through 30.36 December 31, 1998, shall be in effect for taxable years 31.1 beginning after December 31, 1998. 31.2 Except as otherwise provided, references to the Internal 31.3 Revenue Code in subdivisions 19a to 19g mean the code in effect 31.4 for purposes of determining net income for the applicable year. 31.5 Sec. 3. Minnesota Statutes 1998, section 290.01, 31.6 subdivision 19b, is amended to read: 31.7 Subd. 19b. [SUBTRACTIONS FROM FEDERAL TAXABLE INCOME.] For 31.8 individuals, estates, and trusts, there shall be subtracted from 31.9 federal taxable income: 31.10 (1) interest income on obligations of any authority, 31.11 commission, or instrumentality of the United States to the 31.12 extent includable in taxable income for federal income tax 31.13 purposes but exempt from state income tax under the laws of the 31.14 United States; 31.15 (2) if included in federal taxable income, the amount of 31.16 any overpayment of income tax to Minnesota or to any other 31.17 state, for any previous taxable year, whether the amount is 31.18 received as a refund or as a credit to another taxable year's 31.19 income tax liability; 31.20 (3) the amount paid to others, less the credit allowed 31.21 under section 290.0674, not to exceed $1,625 for each dependent 31.22 in grades kindergarten to 6 and $2,500 for each dependent in 31.23 grades 7 to 12, for tuition, textbooks, and transportation of 31.24 each dependent in attending an elementary or secondary school 31.25 situated in Minnesota, North Dakota, South Dakota, Iowa, or 31.26 Wisconsin, wherein a resident of this state may legally fulfill 31.27 the state's compulsory attendance laws, which is not operated 31.28 for profit, and which adheres to the provisions of the Civil 31.29 Rights Act of 1964 and chapter 363. For the purposes of this 31.30 clause, "tuition" includes fees or tuition as defined in section 31.31 290.0674, subdivision 1, clause (1). As used in this clause, 31.32 "textbooks" includes books and other instructional materials and 31.33 equipment used in elementary and secondary schools in teaching 31.34 only those subjects legally and commonly taught in public 31.35 elementary and secondary schools in this state. Equipment 31.36 expenses qualifying for deduction includes expenses as defined 32.1 and limited in section 290.0674, subdivision 1, clause (3). 32.2 "Textbooks" does not include instructional books and materials 32.3 used in the teaching of religious tenets, doctrines, or worship, 32.4 the purpose of which is to instill such tenets, doctrines, or 32.5 worship, nor does it include books or materials for, or 32.6 transportation to, extracurricular activities including sporting 32.7 events, musical or dramatic events, speech activities, driver's 32.8 education, or similar programs; 32.9 (4) to the extent included in federal taxable income, 32.10 distributions from a qualified governmental pension plan, an 32.11 individual retirement account, simplified employee pension, or 32.12 qualified plan covering a self-employed person that represent a 32.13 return of contributions that were included in Minnesota gross 32.14 income in the taxable year for which the contributions were made 32.15 but were deducted or were not included in the computation of 32.16 federal adjusted gross income. The distribution shall be 32.17 allocated first to return of contributions until the 32.18 contributions included in Minnesota gross income have been 32.19 exhausted. This subtraction applies only to contributions made 32.20 in a taxable year prior to 1985; 32.21 (5) income as provided under section 290.0802; 32.22 (6) the amount of unrecovered accelerated cost recovery 32.23 system deductions allowed under subdivision 19g; 32.24 (7) to the extent included in federal adjusted gross 32.25 income, income realized on disposition of property exempt from 32.26 tax under section 290.491; 32.27 (8) to the extent not deducted in determining federal 32.28 taxable income, the amount paid for health insurance of 32.29 self-employed individuals as determined under section 162(l) of 32.30 the Internal Revenue Code, except that the25percent limit does 32.31 not apply. If the taxpayer deducted insurance payments under 32.32 section 213 of the Internal Revenue Code of 1986, the 32.33 subtraction under this clause must be reduced by the lesser of: 32.34 (i) the total itemized deductions allowed under section 32.35 63(d) of the Internal Revenue Code, less state, local, and 32.36 foreign income taxes deductible under section 164 of the 33.1 Internal Revenue Code and the standard deduction under section 33.2 63(c) of the Internal Revenue Code; or 33.3 (ii) the lesser of (A) the amount of insurance qualifying 33.4 as "medical care" under section 213(d) of the Internal Revenue 33.5 Code to the extent not deducted under section 162(1) of the 33.6 Internal Revenue Code or excluded from income or (B) the total 33.7 amount deductible for medical care under section 213(a); 33.8 (9) the exemption amount allowed under Laws 1995, chapter 33.9 255, article 3, section 2, subdivision 3; 33.10 (10) to the extent included in federal taxable income, 33.11 postservice benefits for youth community service under section 33.12 124D.42 for volunteer service under United States Code, title 33.13 42, section 5011(d), as amended; 33.14 (11) to the extent not subtracted under clause (1), the 33.15 amount of income or gain included in federal taxable income 33.16 under section 1366 of the Internal Revenue Code flowing from a 33.17 corporation that has a valid election in effect for the taxable 33.18 year under section 1362 of the Internal Revenue Code which is 33.19 not allowed to be an "S" corporation under section 290.9725; 33.20 (12) in the year stock of a corporation that had made a 33.21 valid election under section 1362 of the Internal Revenue Code 33.22 but was not an "S" corporation under section 290.9725 is sold or 33.23 disposed of in a transaction taxable under the Internal Revenue 33.24 Code, the amount of difference between the Minnesota basis of 33.25 the stock under subdivision 19f, paragraph (m), and the federal 33.26 basis if the Minnesota basis is higher than the shareholder's 33.27 federal basis; and 33.28 (13) an amount equal to an individual's, trust's, or 33.29 estate's net federal income tax liability for the tax year that 33.30 is attributable to items of income, expense, gain, loss, or 33.31 credits federally flowing to the taxpayer in the tax year from a 33.32 corporation, having a valid election in effect for federal tax 33.33 purposes under section 1362 of the Internal Revenue Code but not 33.34 treated as an "S" corporation for state tax purposes under 33.35 section 290.9725. 33.36 Sec. 4. Minnesota Statutes 1998, section 290.01, 34.1 subdivision 31, is amended to read: 34.2 Subd. 31. [INTERNAL REVENUE CODE.] Unless specifically 34.3 defined otherwise, "Internal Revenue Code" means the Internal 34.4 Revenue Code of 1986, as amended through December 31,19971998. 34.5 Sec. 5. Minnesota Statutes 1998, section 290A.03, 34.6 subdivision 15, is amended to read: 34.7 Subd. 15. [INTERNAL REVENUE CODE.] "Internal Revenue Code" 34.8 means the Internal Revenue Code of 1986, as amended through 34.9 December 31,19971998. 34.10 Sec. 6. Minnesota Statutes 1998, section 291.005, 34.11 subdivision 1, is amended to read: 34.12 Subdivision 1. Unless the context otherwise clearly 34.13 requires, the following terms used in this chapter shall have 34.14 the following meanings: 34.15 (1) "Federal gross estate" means the gross estate of a 34.16 decedent as valued and otherwise determined for federal estate 34.17 tax purposes by federal taxing authorities pursuant to the 34.18 provisions of the Internal Revenue Code. 34.19 (2) "Minnesota gross estate" means the federal gross estate 34.20 of a decedent after (a) excluding therefrom any property 34.21 included therein which has its situs outside Minnesota and (b) 34.22 including therein any property omitted from the federal gross 34.23 estate which is includable therein, has its situs in Minnesota, 34.24 and was not disclosed to federal taxing authorities. 34.25 (3) "Personal representative" means the executor, 34.26 administrator or other person appointed by the court to 34.27 administer and dispose of the property of the decedent. If 34.28 there is no executor, administrator or other person appointed, 34.29 qualified, and acting within this state, then any person in 34.30 actual or constructive possession of any property having a situs 34.31 in this state which is included in the federal gross estate of 34.32 the decedent shall be deemed to be a personal representative to 34.33 the extent of the property and the Minnesota estate tax due with 34.34 respect to the property. 34.35 (4) "Resident decedent" means an individual whose domicile 34.36 at the time of death was in Minnesota. 35.1 (5) "Nonresident decedent" means an individual whose 35.2 domicile at the time of death was not in Minnesota. 35.3 (6) "Situs of property" means, with respect to real 35.4 property, the state or country in which it is located; with 35.5 respect to tangible personal property, the state or country in 35.6 which it was normally kept or located at the time of the 35.7 decedent's death; and with respect to intangible personal 35.8 property, the state or country in which the decedent was 35.9 domiciled at death. 35.10 (7) "Commissioner" means the commissioner of revenue or any 35.11 person to whom the commissioner has delegated functions under 35.12 this chapter. 35.13 (8) "Internal Revenue Code" means the United States 35.14 Internal Revenue Code of 1986, as amended through December 31, 35.1519971998. 35.16 Sec. 7. [EFFECTIVE DATES.] 35.17 Sections 1, 4, 5, and 6 are effective at the same time 35.18 federal changes made by the Internal Revenue Service 35.19 Restructuring and Reform Act of 1998, Public Law Number 105-206 35.20 and the Omnibus Consolidation and Emergency Supplemental 35.21 Appropriations Act, 1999, Public Law Number 105-277 which are 35.22 incorporated into Minnesota Statutes, chapters 289A, 290, 290A, 35.23 and 291 by these sections become effective for federal tax 35.24 purposes. Section 3 is effective for tax years beginning after 35.25 December 31, 1998. 35.26 ARTICLE 4 35.27 SALES TAX 35.28 Section 1. Minnesota Statutes 1998, section 289A.56, 35.29 subdivision 4, is amended to read: 35.30 Subd. 4. [CAPITAL EQUIPMENT REFUNDS; REFUNDS TO 35.31 PURCHASERS.] Notwithstanding subdivision 3, for refunds payable 35.32 under section 297A.15, subdivision 5, interest is computed from 35.33 the date the refund claim is filed with the commissioner. For 35.34 refunds payable under section 289A.50, subdivision 2a, interest 35.35 is computed from the 20th day of the month following the month 35.36 of the invoice date for the purchase which is the subject of the 36.1 refund, if the refund claim includes a detailed schedule of 36.2 purchases made during each of the periods in the claim. If the 36.3 refund claim submitted does not contain a schedule reflecting 36.4 purchases made in each period, interest is computed from the 36.5 date the claim was filed. 36.6 Sec. 2. Minnesota Statutes 1998, section 297A.48, is 36.7 amended by adding a subdivision to read: 36.8 Subd. 1a. [RULES FOR ADOPTION, USE, TERMINATION.] (a) 36.9 Imposition of a local sales tax is subject to approval by voters 36.10 of the political subdivision at a general or special election. 36.11 (b) The proceeds of the tax must be dedicated exclusively 36.12 to payment of the cost of a specific capital improvement which 36.13 is designated at least 90 days before the referendum on 36.14 imposition of the tax is conducted. 36.15 (c) The political subdivision must have nonsales tax 36.16 resources or binding commitments to provide nonsales tax 36.17 resources to meet at least 50 percent of the cost of the 36.18 improvement designated under paragraph (b) before it conducts 36.19 the referendum on the imposition of the tax. As used in this 36.20 paragraph, "nonsales tax resources" means funds available to the 36.21 political subdivision without imposition of the local sales tax, 36.22 including revenues from the general or nondedicated special 36.23 funds of the political subdivision, proceeds of a property tax 36.24 levy, or contributions from other sources. 36.25 (d) The tax must terminate after the improvement designated 36.26 under paragraph (b) has been completed. 36.27 (e) After a sales tax imposed by a political subdivision 36.28 has expired or been terminated, the political subdivision is 36.29 prohibited from imposing a local sales tax for a period of one 36.30 year. 36.31 Sec. 3. [CITY OF NEW ULM; TAXES AUTHORIZED.] 36.32 Subdivision 1. [SALES AND USE TAX.] Notwithstanding 36.33 Minnesota Statutes, section 477A.016, or any other provision of 36.34 law, ordinance, or city charter, if approved by the city voters 36.35 at the first municipal general election held after the date of 36.36 final enactment of this act, the city of New Ulm may impose by 37.1 ordinance a sales and use tax of up to one-half of one percent 37.2 for the purposes specified in subdivision 3. The provisions of 37.3 Minnesota Statutes, section 297A.48, govern the imposition, 37.4 administration, collection, and enforcement of the tax 37.5 authorized under this subdivision. 37.6 Subd. 2. [EXCISE TAX AUTHORIZED.] Notwithstanding 37.7 Minnesota Statutes, section 477A.016, or any other provision of 37.8 law, ordinance, or city charter, the city of New Ulm may impose 37.9 by ordinance, for the purposes specified in subdivision 3, an 37.10 excise tax of up to $20 per motor vehicle, as defined by 37.11 ordinance, purchased or acquired from any person engaged within 37.12 the city in the business of selling motor vehicles at retail. 37.13 Subd. 3. [USE OF REVENUES.] Revenues received from taxes 37.14 authorized by subdivisions 1 and 2 must be used by the city to 37.15 pay the cost of collecting the taxes and to pay for construction 37.16 and improvement of a civic and community center and recreational 37.17 facilities to serve all ages, including seniors and youth. 37.18 Authorized expenses include, but are not limited to, acquiring 37.19 property, paying construction and operating expenses related to 37.20 the development of an authorized facility, funding facilities 37.21 replacement reserves, and paying debt service on bonds or other 37.22 obligations issued to finance the construction or expansion of 37.23 an authorized facility. The capital expenses for all projects 37.24 authorized under this subdivision that may be paid with these 37.25 taxes are limited to $9,000,000, plus an amount equal to the 37.26 costs related to issuance of the bonds and funding facilities 37.27 replacement reserves. 37.28 Subd. 4. [BONDING AUTHORITY.] (a) The city may issue bonds 37.29 under Minnesota Statutes, chapter 475, to finance the capital 37.30 expenditure and improvement projects. An election to approve 37.31 the bonds under Minnesota Statutes, section 475.58, may be held 37.32 in combination with the election to authorize imposition of the 37.33 tax under subdivision 1. Whether to permit imposition of the 37.34 tax and issuance of bonds may be posed to the voters as a single 37.35 question. The question must state that the sales tax revenues 37.36 are pledged to pay the bonds, but that the bonds are general 38.1 obligations and will be guaranteed by the city's property taxes. 38.2 (b) The issuance of bonds under this subdivision is not 38.3 subject to Minnesota Statutes, sections 275.60 and 275.61. 38.4 (c) The bonds are not included in computing any debt 38.5 limitation applicable to the city, and the levy of taxes under 38.6 Minnesota Statutes, section 475.61, to pay principal of and 38.7 interest on the bonds is not subject to any levy limitation. 38.8 The aggregate principal amount of bonds, plus the aggregate of 38.9 the taxes used directly to pay eligible capital expenditures and 38.10 improvements may not exceed $9,000,000, plus an amount equal to 38.11 the costs related to issuance of the bonds. 38.12 (d) The taxes may be pledged to and used for the payment of 38.13 the bonds and any bonds issued to refund them, only if the bonds 38.14 and any refunding bonds are general obligations of the city. 38.15 Subd. 5. [TERMINATION OF TAXES.] The taxes imposed under 38.16 subdivisions 1 and 2 expire when the city council determines 38.17 that sufficient funds have been received from the taxes to 38.18 finance the capital and administrative costs for the 38.19 acquisition, construction, and improvement of facilities 38.20 described in subdivision 3, and to prepay or retire at maturity 38.21 the principal, interest, and premium due on any bonds issued for 38.22 the facilities under subdivision 4. Any funds remaining after 38.23 completion of the project and retirement or redemption of the 38.24 bonds may be placed in the general fund of the city. The taxes 38.25 imposed under subdivisions 1 and 2 may expire at an earlier time 38.26 if the city so determines by ordinance. 38.27 Subd. 6. [EFFECTIVE DATE.] This section is effective the 38.28 day after compliance by the governing body of the city of New 38.29 Ulm with Minnesota Statutes, section 645.021, subdivision 3. 38.30 Sec. 4. [CITY OF PROCTOR; TAXES AUTHORIZED.] 38.31 Subdivision 1. [SALES AND USE TAX.] Notwithstanding 38.32 Minnesota Statutes, section 477A.016, or any other provision of 38.33 law, ordinance, or city charter, if approved by the city voters 38.34 at the first municipal general election held after the date of 38.35 final enactment of this act or at a special election, the city 38.36 of Proctor may impose by ordinance a sales and use tax of up to 39.1 one-half of one percent for the purposes specified in 39.2 subdivision 3. The provisions of Minnesota Statutes, section 39.3 297A.48, govern the imposition, administration, collection, and 39.4 enforcement of the tax authorized under this subdivision. 39.5 Subd. 2. [EXCISE TAX AUTHORIZED.] Notwithstanding 39.6 Minnesota Statutes, section 477A.016, or any other provision of 39.7 law, ordinance, or city charter, the city of Proctor may impose 39.8 by ordinance, for the purposes specified in subdivision 3, an 39.9 excise tax of up to $20 per motor vehicle, as defined by 39.10 ordinance, purchased or acquired from any person engaged within 39.11 the city in the business of selling motor vehicles at retail. 39.12 Subd. 3. [USE OF REVENUES.] Revenues received from taxes 39.13 authorized by subdivisions 1 and 2 must be used by the city to 39.14 pay the cost of collecting the taxes and to pay for construction 39.15 and improvement of the following city facilities: 39.16 (1) streets and sidewalks; 39.17 (2) bikeways, including providing matching funds for 39.18 trails; and 39.19 (3) constructing and equipping the Proctor community 39.20 activity center. 39.21 Authorized expenses include, but are not limited to, 39.22 acquiring property, paying construction and operating expenses 39.23 related to the development of an authorized facility, and paying 39.24 debt service on bonds or other obligations, including lease 39.25 obligations, issued to finance the construction, expansion, or 39.26 improvement of an authorized facility. The capital expenses for 39.27 all projects authorized under this paragraph that may be paid 39.28 with these taxes is limited to $3,600,000, plus an amount equal 39.29 to the costs related to issuance of the bonds. 39.30 Subd. 4. [BONDING AUTHORITY.] (a) The city may issue bonds 39.31 under Minnesota Statutes, chapter 475, to finance the capital 39.32 expenditure and improvement projects described in subdivision 39.33 3. An election to approve the bonds under Minnesota Statutes, 39.34 section 475.58, is not required. 39.35 (b) The issuance of bonds under this subdivision is not 39.36 subject to Minnesota Statutes, sections 275.60 and 279.61. 40.1 (c) The bonds are not included in computing any debt 40.2 limitation applicable to the city, and the levy of taxes under 40.3 Minnesota Statutes, section 475.61, to pay principal of and 40.4 interest on the bonds is not subject to any levy limitation. 40.5 (d) The aggregate principal amount of bonds, plus the 40.6 aggregate of the taxes used directly to pay eligible capital 40.7 expenditures and improvements, may not exceed $3,600,000, plus 40.8 an amount equal to the costs related to issuance of the bonds, 40.9 including interest on the bonds. 40.10 (e) The sales and use and excise taxes authorized in this 40.11 section may be pledged to and used for the payment of the bonds 40.12 and any bonds issued to refund them only if the bonds and any 40.13 refunding bonds are general obligations of the city. 40.14 Subd. 5. [TERMINATION OF TAXES.] The taxes imposed under 40.15 subdivisions 1 and 2 expire when the city council determines 40.16 that the amount described in subdivision 4, paragraph (d), has 40.17 been received from the taxes to finance the capital and 40.18 administrative costs for the acquisition, construction, 40.19 expansion, and improvement of facilities described in 40.20 subdivision 3, plus the additional amount needed to pay the 40.21 costs related to issuance of bonds under subdivision 4. Any 40.22 funds remaining after completion of the project and retirement 40.23 or redemption of the bonds may be placed in the general fund of 40.24 the city. The taxes imposed under subdivisions 1 and 2 may 40.25 expire at an earlier time if the city so determines by ordinance. 40.26 Subd. 6. [EFFECTIVE DATE.] This section is effective the 40.27 day after compliance by the governing body of the city of 40.28 Proctor with Minnesota Statutes, section 645.021, subdivision 3. 40.29 Sec. 5. [EFFECTIVE DATE.] 40.30 Section 1 is effective for amended returns and refund 40.31 claims filed on or after July 1, 1999. 40.32 ARTICLE 5 40.33 MOTOR VEHICLE REGISTRATION TAX 40.34 Section 1. Minnesota Statutes 1998, section 168.013, 40.35 subdivision 1a, is amended to read: 40.36 Subd. 1a. [PASSENGER AUTOMOBILE; HEARSE.] (a) On passenger 41.1 automobiles as defined in section 168.011, subdivision 7, and 41.2 hearses, except as otherwise provided, the tax shall be $10 plus 41.3 an additional tax equal to1.251.2 percent of the base value. 41.4 (b) Subject to the classification provisions herein, "base 41.5 value" means the manufacturer's suggested retail price of the 41.6 vehicle including destination charge using list price 41.7 information published by the manufacturer or determined by the 41.8 registrar if no suggested retail price exists, and shall not 41.9 include the cost of each accessory or item of optional equipment 41.10 separately added to the vehicle and the suggested retail price. 41.11 (c) If the manufacturer's list price information contains a 41.12 single vehicle identification number followed by various 41.13 descriptions and suggested retail prices, the registrar shall 41.14 select from those listings only the lowest price for determining 41.15 base value. 41.16 (d) If unable to determine the base value because the 41.17 vehicle is specially constructed, or for any other reason, the 41.18 registrar may establish such value upon the cost price to the 41.19 purchaser or owner as evidenced by a certificate of cost but not 41.20 including Minnesota sales or use tax or any local sales or other 41.21 local tax. 41.22 (e) The registrar shall classify every vehicle in its 41.23 proper base value class as follows: 41.24 FROM TO 41.25 $ 0 $199.99 41.26 200 399.99 41.27 and thereafter a series of classes successively set in brackets 41.28 having a spread of $200 consisting of such number of classes as 41.29 will permit classification of all vehicles. 41.30 (f) The base value for purposes of this section shall be 41.31 the middle point between the extremes of its class. 41.32 (g) The registrar shall establish the base value, when new, 41.33 of every passenger automobile and hearse registered prior to the 41.34 effective date of Extra Session Laws 1971, chapter 31, using 41.35 list price information published by the manufacturer or any 41.36 nationally recognized firm or association compiling such data 42.1 for the automotive industry. If unable to ascertain the base 42.2 value of any registered vehicle in the foregoing manner, the 42.3 registrar may use any other available source or method. The tax 42.4 on all previously registered vehicles shall be computed upon the 42.5 base value thus determined taking into account the depreciation 42.6 provisions of paragraph (h). 42.7 (h)Except as provided in paragraph (i),The annual 42.8 additional tax computed upon the base value as provided herein, 42.9 during the firstand second yearsyear of vehicle life shall be 42.10 computed upon 100 percent of the base value; for thethird and42.11fourth yearssecond year, 90 percent of such value; for 42.12 the third year, 82.5 percent of such value; for the fourth year, 42.13 75 percent of such value; for the fifthand sixth yearsyear,7542.14 65 percent of such value; for the sixth year, 60 percent of such 42.15 value; for the seventh year,6045 percent of such value; for 42.16 the eighth year,4030 percent of such value; for the ninth 42.17 year,3020 percent of such value; for the tenth year, ten 42.18 percent of such value; for the 11th and each succeeding year, 42.19 the sum of $25. 42.20 In no event shall the annual additional tax be less than 42.21 $25. 42.22(i) The annual additional tax under paragraph (h) on a42.23motor vehicle on which the first annual tax was paid before42.24January 1, 1990, must not exceed the tax that was paid on that42.25vehicle the year before.42.26 Sec. 2. [TRANSFERS TO HIGHWAY USER TAX DISTRIBUTION FUND.] 42.27 By January 1, 2000, the commissioner of finance shall 42.28 transfer $32,900,000 from the general fund to the highway user 42.29 tax distribution fund. For fiscal year 2001, the commissioner 42.30 of finance shall transfer $68,769,000 from the general fund to 42.31 the highway user tax distribution fund. 42.32 As part of the biennial budget for fiscal years 2002 and 42.33 2003 and in each biennial budget thereafter, the commissioner 42.34 shall provide an estimate of the amount of revenue lost to the 42.35 highway user tax distribution fund due to the registration tax 42.36 reduction in section 1. 43.1 Sec. 3. [EFFECTIVE DATE.] 43.2 Section 1 is effective January 1, 2000. 43.3 ARTICLE 6 43.4 SPECIAL TAXES 43.5 Section 1. Minnesota Statutes 1998, section 60A.19, 43.6 subdivision 6, is amended to read: 43.7 Subd. 6. [RETALIATORY PROVISIONS.] (1) When by the laws of 43.8 any other state or country any taxes, fines, deposits, 43.9 penalties, licenses, or fees,other than assessments made by an43.10insurance guaranty association or similar organization,in 43.11 addition to or in excess of those imposed by the laws of this 43.12 state upon foreign insurance companies and their agents doing 43.13 business in this state,other than assessments by an insurance43.14guaranty association or similar organization organized under the43.15laws of this state,are imposed on insurance companies of this 43.16 state and their agents doing business in that state or country, 43.17 or when any conditions precedent to the right to do business in 43.18 that state are imposed by the laws thereof, beyond those imposed 43.19 upon these foreign companies by the laws of this state, the same 43.20 taxes, fines, deposits, penalties, licenses, fees, and 43.21 conditions precedent shall be imposed upon every similar 43.22 insurance company of that state or country and their agents 43.23 doing or applying to do business in this state so long as these 43.24 foreign laws remain in force. Special purpose obligations or 43.25 assessments, including assessments by an insurance guaranty 43.26 association, joint underwriting association or similar 43.27 organization, or assessments imposed in connection with 43.28 particular kinds of insurance, are not taxes, licenses, or fees 43.29 as these terms are used in this section. 43.30 (2) In the event that a domestic insurance company, after 43.31 complying with all reasonable laws and rulings of any other 43.32 state or country, is refused permission by that state or country 43.33 to transact business therein after the commissioner of commerce 43.34 of Minnesota has determined that that company is solvent and 43.35 properly managed and after the commissioner has so certified to 43.36 the proper authority of that other state or country, then, and 44.1 in every such case, the commissioner may forthwith suspend or 44.2 cancel the certificate of authority of every insurance company 44.3 organized under the laws of that other state or country to the 44.4 extent that it insures, or seeks to insure, in this state 44.5 against any of the risks or hazards which that domestic company 44.6 seeks to insure against in that other state or country. Without 44.7 limiting the application of the foregoing provision, it is 44.8 hereby determined that any law or ruling of any other state or 44.9 country which prescribes to a Minnesota domestic insurance 44.10 company the premium rate or rates for life insurance issued or 44.11 to be issued outside that other state or country shall not be 44.12 reasonable. 44.13 (3) This section does not apply to insurance companies 44.14 organized or domiciled in a state or country, the laws of which 44.15 do not impose retaliatory taxes, fines, deposits, penalties, 44.16 licenses, or fees or which grant, on a reciprocal basis, 44.17 exemptions from retaliatory taxes, fines, deposits, penalties, 44.18 licenses, or fees to insurance companies domiciled in this state. 44.19 Sec. 2. Minnesota Statutes 1998, section 296A.16, is 44.20 amended by adding a subdivision to read: 44.21 Subd. 4a. [UNDYED KEROSENE; REFUNDS.] Notwithstanding 44.22 subdivision 1, the commissioner shall allow a refund of the tax 44.23 paid on undyed kerosene used exclusively for a purpose other 44.24 than as fuel for a motor vehicle using the streets and 44.25 highways. To obtain a refund, the person making the sale to an 44.26 end user must meet the Internal Revenue Service requirements for 44.27 sales from a blocked pump. A claim for a refund may be filed as 44.28 provided in this section. 44.29 Sec. 3. Minnesota Statutes 1998, section 296A.16, is 44.30 amended by adding a subdivision to read: 44.31 Subd. 4b. [RACING GASOLINE; REFUNDS.] Notwithstanding 44.32 subdivision 1, the commissioner shall allow a licensed 44.33 distributor a refund of the tax paid on leaded gasoline of 110 44.34 octane or more that does not meet ASTM specification D4814 for 44.35 gasoline and that is sold in bulk for use in nonregistered motor 44.36 vehicles. A claim for a refund may be filed as provided for in 45.1 this section. 45.2 Sec. 4. Minnesota Statutes 1998, section 297H.05, is 45.3 amended to read: 45.4 297H.05 [SELF-HAULERS.] 45.5 (a) A self-hauler of mixed municipal solid waste shall pay 45.6 the tax to the operator of the waste management facility to 45.7 which the waste is delivered at the rate imposed under section 45.8 297H.03, based on the sales price of the waste management 45.9 services, except that a self-hauler of mixed municipal solid 45.10 waste from a residential generator shall pay the tax to the 45.11 operator of the waste management facility to which the waste is 45.12 delivered at the rate imposed under section 297H.02. 45.13 (b) A self-hauler of non-mixed-municipal solid waste shall 45.14 pay the tax to the operator of the waste management facility to 45.15 which the waste is delivered at the rate imposed under section 45.16 297H.04. 45.17 (c) The tax imposed on the self-hauler of 45.18 non-mixed-municipal solid waste may be based either on the 45.19 capacity of the container, the actual volume, or the 45.20 weight-to-volume conversion schedule in paragraph (d). However, 45.21 the tax must be calculated by the operator using the same method 45.22 for calculating the tipping fee so that both are calculated 45.23 according to container capacity, actual volume, or weight. 45.24 (d) The weight-to-volume conversion schedule for: 45.25 (1) construction debris as defined in section 115A.03, 45.26 subdivision 7, is one ton equals 3.33 cubic yards, or $2 per 45.27 ton; 45.28 (2) industrial waste as defined in section 115A.03, 45.29 subdivision 13a, is equal to 60 cents per cubic yard. The 45.30 commissioner of revenue, after consultation with the 45.31 commissioner of the pollution control agency, shall determine, 45.32 and may publish by notice, a conversion schedule for various 45.33 industrial wastes; and 45.34 (3) infectious waste as defined in section 116.76, 45.35 subdivision 12, and pathological waste as defined in section 45.36 116.76, subdivision 14, is 150 pounds equals one cubic yard, or 46.1 60 cents per 150 pounds. 46.2 (e) For mixed municipal solid waste the tax is imposed upon 46.3 the difference between the market price and the tip fee at a 46.4 processing or disposal facility if the tip fee is less than the 46.5 market price and the political subdivision subsidizes the cost 46.6 of service at the facility. The political subdivision is liable 46.7 for the tax. 46.8 Sec. 5. [EFFECTIVE DATE.] 46.9 Section 1 is effective for tax years beginning after 46.10 December 31, 1999. Section 2 is effective retroactively for 46.11 sales made after June 30, 1998. Section 3 is effective 46.12 retroactively for sales made after January 31, 1999. Section 4 46.13 is effective for services provided after June 30, 1999. 46.14 ARTICLE 7 46.15 WORKFORCE DEVELOPMENT AND EDUCATION INCENTIVES 46.16 Section 1. Minnesota Statutes 1998, section 116L.03, 46.17 subdivision 1, is amended to read: 46.18 Subdivision 1. [MEMBERS.] The partnership shall be 46.19 governed by a board of1112 directors. 46.20 Sec. 2. Minnesota Statutes 1998, section 116L.03, 46.21 subdivision 2, is amended to read: 46.22 Subd. 2. [APPOINTMENT.] The Minnesota job skills 46.23 partnership board consists of: eight members appointed by the 46.24 governor, the commissioner of trade and economic development, 46.25 the commissioner of economic security, and the chancellor, or 46.26 the chancellor's designee, of the Minnesota state colleges and 46.27 universities. If the chancellor makes a designation under this 46.28 subdivision, the designee must have experience in technical 46.29 education. Two of the appointed members must be representatives 46.30 from organized labor. 46.31 Sec. 3. [116L.07] [WORKFORCE DEVELOPMENT FUND.] 46.32 Subdivision 1. [CREATED.] The Minnesota workforce 46.33 development fund is created as a separate dedicated account in 46.34 the treasury. Earnings, including interest earnings of the 46.35 fund, must be credited to the account. Money in the fund is 46.36 appropriated to the jobs skills partnership board and must be 47.1 allocated and expended as provided in this section. The board 47.2 shall consult with the governor's workforce development council 47.3 about fund expenditures. 47.4 Subd. 2. [USES; ALLOCATIONS.] The board shall allocate all 47.5 available money in the fund each fiscal year to the following 47.6 programs in the following percentages: 47.7 (1) forty percent to the partnership program described 47.8 under section 116L.04, subdivision 1; 47.9 (2) ten percent to the pathways program under section 47.10 116L.04, subdivision 1a; and 47.11 (3) fifty percent to be allocated to the dislocated worker 47.12 program under sections 116L.07 to 116L.17, the apprenticeship 47.13 program under sections 178.01 to 178.10, and other job training 47.14 programs. 47.15 Priority for allocations under clause (3) must be to fund 47.16 the dislocated worker program and the apprenticeship program. 47.17 The board shall focus funding efforts on retraining programs 47.18 when there is low unemployment and place more emphasis on 47.19 dislocated worker programs when there is high unemployment. The 47.20 board shall, for the purpose of maintaining continuity in 47.21 training and placement programs, give priority for grants and 47.22 loans to organizations with a history of effectiveness in job 47.23 placement and that previously have received funding from public 47.24 or private nonprofit sources. 47.25 Expenditures for the dislocated worker program under 47.26 sections 116L.08 to 116L.17 shall be allocated as follows: 47.27 (1) 40 percent to be allocated annually to substate 47.28 grantees and independent grantees for provision of expeditious 47.29 response activities under section 116L.11 and worker adjustment 47.30 services under section 116L.13; and 47.31 (2) 60 percent to be allocated to activities and programs 47.32 authorized under sections 116L.07 to 116L.17. 47.33 Any funds not allocated, obligated, or expended in a fiscal 47.34 year shall be available for allocation, obligation, and 47.35 expenditure in the following fiscal year. The board shall 47.36 require that programs receiving money from the development fund 48.1 coordinate their activities with the workforce center system 48.2 operated by the department of economic security to the maximum 48.3 extent feasible and cooperate with the centers. 48.4 Sec. 4. [116L.08] [DEFINITIONS.] 48.5 Subdivision 1. [TERMS.] For the purposes of sections 48.6 116L.07 to 116L.17, the following terms have the meanings given 48.7 them. 48.8 Subd. 2. [BOARD.] "Board" means the job skills partnership 48.9 board. 48.10 Subd. 3. [DISLOCATED WORKER.] "Dislocated worker" means an 48.11 individual who is a resident of Minnesota at the time employment 48.12 ceased or was working in the state at the time employment ceased 48.13 and: 48.14 (1) has been terminated or who has received a notice of 48.15 termination from public or private sector employment, is 48.16 eligible for or has exhausted entitlement to reemployment 48.17 insurance, and is unlikely to return to the previous industry or 48.18 occupation; 48.19 (2) has been terminated or has received a notice of 48.20 termination of employment as a result of any plant closing or 48.21 any substantial layoff at a plant, facility, or enterprise; 48.22 (3) has been long-term unemployed and has limited 48.23 opportunities for employment or reemployment in the same or a 48.24 similar occupation in the area in which the individual resides, 48.25 including older individuals who may have substantial barriers to 48.26 employment by reason of age; or 48.27 (4) has been self-employed, including farmers and ranchers, 48.28 and is unemployed as a result of general economic conditions in 48.29 the community in which the individual resides or because of 48.30 natural disasters, subject to rules to be adopted by the board. 48.31 Subd. 3a. [ADDITIONAL DISLOCATED WORKER.] "Additional 48.32 dislocated worker" means an individual who was a full-time 48.33 homemaker for a substantial number of years and derived the 48.34 substantial share of support from: 48.35 (1) a spouse and no longer receives such support due to the 48.36 death, divorce, permanent disability of, or permanent separation 49.1 from the spouse; or 49.2 (2) public assistance on account of dependents in the home 49.3 and no longer receives such support. 49.4 An additional dislocated worker must have resided in 49.5 Minnesota at the time the support ceased. 49.6 Subd. 4. [ELIGIBLE ORGANIZATION.] "Eligible organization" 49.7 means a local government unit, nonprofit organization, community 49.8 action agency, business organization or association, or labor 49.9 organization. 49.10 Subd. 5. [LOCAL GOVERNMENT UNIT.] "Local government unit" 49.11 means a statutory or home rule charter city, county, or town. 49.12 Subd. 6. [PLANT CLOSING.] "Plant closing" means the 49.13 announced or actual permanent shutdown of a single site of 49.14 employment, or one or more facilities or operating units within 49.15 a single site of employment. 49.16 Subd. 7. [PREFEASIBILITY STUDY GRANT.] "Prefeasibility 49.17 study grant" means the grant awarded under section 116L.12. 49.18 Subd. 8. [SUBSTANTIAL LAYOFF.] "Substantial layoff" means 49.19 a permanent reduction in the work force, which is not a result 49.20 of a plant closing, and which results in an employment loss at a 49.21 single site of employment during any 30-day period for at least 49.22 25 employees excluding those employees that work less than 20 49.23 hours a week. 49.24 Subd. 9. [SUBSTATE GRANTEE.] "Substate grantee" means the 49.25 agency or organization designated to administer at the local 49.26 level federal dislocated worker programs pursuant to the federal 49.27 Job Training Partnership Act, United States Code, title 29, 49.28 section 1501, et seq. 49.29 Subd. 10. [WORKER ADJUSTMENT SERVICES.] "Worker adjustment 49.30 services" means the array of employment and training services 49.31 designed to assist dislocated workers make the transition to new 49.32 employment, including basic readjustment assistance, training 49.33 assistance, and support services. 49.34 Subd. 11. [BASIC READJUSTMENT ASSISTANCE.] "Basic 49.35 readjustment assistance" means employment transition services 49.36 that include, but are not limited to: development of individual 50.1 readjustment plans for participants; outreach and intake; early 50.2 readjustment; job or career counseling; testing; orientation; 50.3 assessment, including evaluation of educational attainment and 50.4 participant interests and aptitudes; determination of 50.5 occupational skills; provision of occupational information; job 50.6 placement assistance; labor market information; job clubs; job 50.7 search; job development; prelayoff assistance; work readiness 50.8 skills for new employment environments; relocation assistance; 50.9 and programs conducted in cooperation with employers or labor 50.10 organizations to provide early intervention in the event of 50.11 plant closings or substantial layoffs. 50.12 Subd. 12. [TRAINING ASSISTANCE.] "Training assistance" 50.13 means services that will enable a dislocated worker to become 50.14 reemployed by retraining for a new occupation or industry, 50.15 enhancing current skills, or relocating to employ existing 50.16 skills. Training services include, but are not limited to: 50.17 classroom training; occupational skill training; on-the-job 50.18 training; out-of-area job search; relocation; basic and remedial 50.19 education; literacy and English for training non-English 50.20 speakers; entrepreneurial training; and other appropriate 50.21 training activities directly related to appropriate employment 50.22 opportunities in the local labor market. 50.23 Subd. 13. [SUPPORT SERVICES.] "Support services" means 50.24 assistance provided to dislocated workers to enable their 50.25 participation in an employment transition and/or training 50.26 program. Services include, but are not limited to: family care 50.27 assistance, including child care; commuting assistance; housing 50.28 and rental assistance; counseling assistance, including personal 50.29 and financial; health care; emergency health assistance; 50.30 emergency financial assistance; work-related tools and clothing; 50.31 and other appropriate support services that enable a person to 50.32 participate in an employment and training program. 50.33 Sec. 5. [116L.10] [EARLY WARNING SYSTEM.] 50.34 Subdivision 1. [EARLY WARNING INDICATORS.] The board, in 50.35 cooperation with the commissioners of economic security, 50.36 revenue, and trade and economic development, shall establish and 51.1 oversee an early warning system to identify industries and 51.2 businesses likely to experience large losses in employment 51.3 including a plant closing or a substantial layoff, by collecting 51.4 and analyzing information which may include, but not be limited 51.5 to, products and markets experiencing declining growth rates, 51.6 companies and industries subject to competition from production 51.7 in low wage counties, changes in ownership, layoff and 51.8 employment patterns, payments of reemployment insurance 51.9 contributions, and state tax payments. The board may request 51.10 the assistance of businesses, business organizations, organized 51.11 labor, and trade associations in identifying businesses, 51.12 industries, and specific establishments that are likely to 51.13 experience large losses in employment. The board may request 51.14 information and other assistance from other state agencies for 51.15 the purposes of this subdivision. 51.16 Subd. 2. [NOTICE.] (a) The board shall encourage those 51.17 business establishments considering a decision to effect a plant 51.18 closing, substantial layoff, or relocation of operations located 51.19 in this state to give notice of that decision as early as 51.20 possible to the board, the employees of the affected 51.21 establishment, any organized labor union representing the 51.22 employees, and the local government unit in which the affected 51.23 establishment is located. This notice shall be in addition to 51.24 any notice required under the Worker Adjustment and Retraining 51.25 Notification Act, United States Code, title 29, section 2101. 51.26 (b) Notwithstanding section 268.975, subdivision 6, for 51.27 purposes of this section, "plant closing" means the announced or 51.28 actual permanent or temporary shutdown of a single site of 51.29 employment, or one or more facilities or operating units within 51.30 a single site of employment, if the shutdown results in an 51.31 employment loss at the single site of employment during any 51.32 30-day period for 25 or more employees excluding employees who 51.33 work less than 20 hours per week. 51.34 Subd. 3. [EMPLOYER RESPONSIBILITY.] An employer providing 51.35 notice of a plant closing, substantial layoff, or relocation of 51.36 operations under the Worker Adjustment and Retraining 52.1 Notification Act, United States Code, title 29, section 2101, or 52.2 under subdivision 2 must report to the board the names, 52.3 addresses, and occupations of the employees who will be or have 52.4 been terminated. 52.5 Sec. 6. [116L.11] [RAPID AND EXPEDITIOUS RESPONSE.] 52.6 Subdivision 1. [RESPONSIBILITY.] The board shall respond 52.7 quickly and effectively to announced or actual plant closings 52.8 and substantial layoffs. Affected workers and employers, as 52.9 well as appropriate business organizations or associations, 52.10 labor organizations, substate grantees, independent grantees, 52.11 state and local government units, and community organizations 52.12 shall be assisted by the board through either rapid response 52.13 activities or expeditious response activities as described in 52.14 this section to respond effectively to a plant closing or mass 52.15 layoff. 52.16 Subd. 2. [COVERAGE.] Rapid response is to be provided by 52.17 the board where permanent plant closings or substantial layoffs 52.18 affect at least 25 workers over a 30-day period as evidenced by 52.19 actual separation from employment or by advance notification of 52.20 a closing or layoff. Expeditious response is to be provided by 52.21 worker adjustment services plan grantees in coordination with 52.22 rapid response activities or where permanent plant closings and 52.23 substantial layoffs are not otherwise covered by rapid response. 52.24 Subd. 3. [COORDINATION.] The board and expeditious 52.25 response grantees shall coordinate their respective rapid 52.26 response and expeditious response activities. The roles and 52.27 responsibilities of each shall be detailed in written agreements 52.28 and address on-site contact with employer and employee 52.29 representatives when notified of a plant closing or substantial 52.30 layoff. The activities include formation of a community task 52.31 force, collecting and disseminating information related to 52.32 economic dislocation and available services to dislocated 52.33 workers, providing basic readjustment assistance services to 52.34 workers affected by a plant closure or substantial layoff, 52.35 conducting a needs assessment survey of workers, and developing 52.36 a plan of action responsive to the worker adjustment services 53.1 needs of affected workers. 53.2 Subd. 4. [RAPID RESPONSE ACTIVITIES.] The board shall be 53.3 responsible for implementing the following rapid response 53.4 activities: 53.5 (1) establishing on-site contact with employer and employee 53.6 representatives immediately after becoming aware of a current or 53.7 projected plant closing or substantial layoff in order to: 53.8 (i) provide information on and facilitate access to 53.9 available public programs and services; and 53.10 (ii) provide emergency assistance adapted to the particular 53.11 closure or layoff; 53.12 (2) promoting the formation of a labor-management committee 53.13 by providing: 53.14 (i) immediate assistance in the establishment of the 53.15 labor-management committee; 53.16 (ii) technical advice and information on sources of 53.17 assistance, and liaison with other public and private services 53.18 and programs; and 53.19 (iii) assistance in the selection of worker representatives 53.20 in the event no union is present; 53.21 (3) collecting and disseminating information related to 53.22 economic dislocation, including potential closings or layoffs, 53.23 and all available resources with the state for dislocated 53.24 workers; 53.25 (4) providing or obtaining appropriate financial and 53.26 technical advice and liaison with economic development agencies 53.27 and other organizations to assist in efforts to avert 53.28 dislocations; 53.29 (5) disseminating information throughout the state on the 53.30 availability of services and activities carried out by the 53.31 dislocated worker unit; 53.32 (6) assisting the local community in developing its own 53.33 coordinated response to a plant closing or substantial layoff 53.34 and access to state economic development assistance; 53.35 (7) promoting the use of prefeasibility study grants under 53.36 section 116L.12; and 54.1 (8) conducting surveys of workers, if appropriate, affected 54.2 by plant closings or layoffs to identify worker characteristics 54.3 and worker adjustment service needs. 54.4 Subd. 5. [EXPEDITIOUS RESPONSE ACTIVITIES.] Grantees 54.5 designated to provide worker adjustment services through worker 54.6 adjustment services plans shall be responsible for implementing 54.7 the following expeditious response activities: 54.8 (1) establishing on-site contact with employer and employee 54.9 representatives, not otherwise covered under rapid response, 54.10 within a short period of time after becoming aware of a current 54.11 or projected plant closing or mass layoff in order to provide 54.12 information on available public programs and services; 54.13 (2) obtaining appropriate financial and technical advice 54.14 and liaison with local economic development agencies and other 54.15 organizations to assist in efforts to avert dislocations; 54.16 (3) disseminating information on the availability of 54.17 services and activities carried out by the grantee through its 54.18 worker adjustment services plan; 54.19 (4) providing basic readjustment assistance services for up 54.20 to 90 days following the initial on-site meeting with the 54.21 employer and employee representatives; 54.22 (5) assisting the local community in the development of its 54.23 own coordinated response to the closure or layoff and access to 54.24 economic development assistance; 54.25 (6) facilitating the formation of a community task force, 54.26 if appropriate, to formulate a service plan to assist affected 54.27 dislocated workers from plant closings and mass layoffs; 54.28 (7) conducting surveys of workers, if appropriate, affected 54.29 by plant closings or layoffs to identify worker characteristics 54.30 and worker adjustment service needs; and 54.31 (8) facilitating access to available public or private 54.32 programs and services, including the development of proposals to 54.33 provide access to additional resources to assist workers 54.34 affected by plant closings and substantial layoffs. 54.35 Sec. 7. [116L.12] [PREFEASIBILITY STUDIES.] 54.36 Subdivision 1. [PREFEASIBILITY STUDY GRANTS.] (a) The 55.1 board may make grants for up to $15,000 to eligible 55.2 organizations to provide an initial assessment of the 55.3 feasibility of alternatives to plant closings or substantial 55.4 layoffs. The alternatives may include employee ownership, other 55.5 new ownership, new products or production processes, or public 55.6 financial or technical assistance to keep a plant open. Two or 55.7 more eligible organizations may jointly apply for a grant under 55.8 this section. 55.9 (b) Interested organizations shall apply to the board for 55.10 the grants. As part of the application process, applicants must 55.11 provide a statement of need for a grant, information relating to 55.12 the work force at the plant, the area's unemployment rate, the 55.13 community's and surrounding area's labor market characteristics, 55.14 information of efforts to coordinate the community's response to 55.15 the plant closing or substantial layoff, a timetable of the 55.16 prefeasibility study, a description of the organization applying 55.17 for the grant, a description of the qualifications of persons 55.18 conducting the study, and other information required by the 55.19 board. 55.20 (c) The board shall respond to the applicant within five 55.21 working days of receiving the organization's application. The 55.22 board shall inform each organization that applied for but did 55.23 not receive a grant the reasons for the grant not being 55.24 awarded. The board may request further information from those 55.25 organizations that did not receive a grant, and the organization 55.26 may reapply for the grant. 55.27 Subd. 2. [PREFEASIBILITY STUDY.] (a) The prefeasibility 55.28 study must explore the current and potential viability, 55.29 profitability, and productivity of the plant that may close or 55.30 experience a substantial layoff and alternative uses for the 55.31 plant. The study is not intended to be a major examination of 55.32 each possible alternative but rather is meant to quickly 55.33 determine if further action or examination is feasible and 55.34 should be fully explored. 55.35 (b) The prefeasibility study must contain: 55.36 (1) a description of the plant's present products, 56.1 production techniques, management structure, and history; 56.2 (2) a brief discussion of the feasibility of the various 56.3 alternatives for ownership, production technique, and products; 56.4 (3) an estimate of the financing required to keep the plant 56.5 open and the potential sources of that financing; 56.6 (4) a description of the employer's, employees', and 56.7 community's efforts to maintain the operation of the plant; and 56.8 (5) other information the board may require. 56.9 Sec. 8. [116L.13] [WORKER ADJUSTMENT SERVICES PLANS.] 56.10 Subdivision 1. [WORKER ADJUSTMENT SERVICES PLANS.] The 56.11 board shall establish and fund worker adjustment services plans 56.12 that are designed to assist dislocated workers in their 56.13 transition to new employment. Authorized grantees shall submit 56.14 a worker adjustment services plan biennially, with an annual 56.15 update, in a form and manner prescribed by the board. The 56.16 worker adjustment services plan shall include information 56.17 required in substate plans established under the federal Job 56.18 Training Partnership Act, United States Code, title 29, section 56.19 1501, et seq. and a detailed description of expeditious response 56.20 activities to be implemented under the plan. 56.21 Subd. 2. [GRANTEES.] Entities authorized to submit a 56.22 worker adjustment services plan include substate grantees and up 56.23 to six additional eligible organizations that may be funded by 56.24 state or federal sources of funding. Criteria for selecting the 56.25 six authorized independent nonsubstate grantee eligible 56.26 organizations shall be established by the board, in consultation 56.27 with the workforce development council. The criteria include, 56.28 but are not limited to: 56.29 (1) the capacity to deliver worker adjustment services; 56.30 (2) an identifiable constituency from which eligible 56.31 dislocated workers may be drawn; 56.32 (3) a demonstration of a good faith effort to establish 56.33 coordination agreements with substate grantees in whose 56.34 geographic area the organization would be operating; 56.35 (4) the capability to coordinate delivery of worker 56.36 adjustment services with other appropriate programs and 57.1 agencies, including educational institutions, employment 57.2 service, human service agencies, and economic development 57.3 agencies; and 57.4 (5) sufficient administrative controls to ensure fiscal 57.5 accountability. 57.6 Subd. 3. [COVERAGE.] (a) Persons eligible to receive 57.7 worker adjustment services under this section include dislocated 57.8 workers as defined in section 116L.08, subdivision 3. 57.9 (b) Worker adjustment services available under this section 57.10 shall also be available to additional dislocated workers as 57.11 defined in section 116L.08, subdivision 3a, when they can be 57.12 provided without adversely affecting delivery of services to all 57.13 dislocated workers. 57.14 Subd. 4. [SUBSTATE AND INDEPENDENT GRANTEE FUNDING.] (a) 57.15 Funds allocated to substate and independent grantees for 57.16 expeditious response activities and worker adjustment services 57.17 under this section shall be allocated as follows: 57.18 (1) one-half of available funds shall be allocated to 57.19 substate and independent grantees based on an allocation formula 57.20 prescribed by the board, in consultation with the workforce 57.21 development council; and 57.22 (2) one-half of available funds shall be allocated based on 57.23 need as demonstrated to the board in consultation with the 57.24 workforce development council. 57.25 (b) The formula for allocating substate and independent 57.26 grantee funds must utilize the most appropriate information 57.27 available to the board to distribute funds in order to address 57.28 the state's worker adjustment assistance needs. Information for 57.29 the formula allocation may include, but is not limited to: 57.30 (1) insured unemployment data; 57.31 (2) dislocated worker special assessment receipts data; 57.32 (3) small plant closing data; 57.33 (4) declining industries data; 57.34 (5) farmer-rancher economic hardship data; and 57.35 (6) long-term unemployment data. 57.36 (c) The board shall establish a uniform procedure for 58.1 reallocating substate and independent grantee funds. The 58.2 criteria for reallocating funds from substate and independent 58.3 grantees not expending their allocations consistent with their 58.4 worker adjustment services plans to other substate and 58.5 independent grantees shall be developed by the board in 58.6 consultation with the workforce development council. 58.7 Sec. 9. [116L.14] [DISLOCATION EVENT SERVICES GRANTS.] 58.8 Subdivision 1. [DISLOCATION EVENT SERVICES GRANTS.] The 58.9 board shall establish and fund dislocation event services grants 58.10 designed to provide worker adjustment services to workers 58.11 displaced as a result of larger plant closings and substantial 58.12 layoffs. Grantees shall apply for a dislocation event services 58.13 grant by submitting a proposal to the board in a form and manner 58.14 prescribed by the board. The application must describe the 58.15 demonstrated need for intervention, including the need for 58.16 retraining, the workers to be served, the coordination of 58.17 available local resources, the services to be provided, and the 58.18 budget plan. 58.19 Subd. 2. [GRANTEES.] (a) Entities authorized to submit 58.20 dislocation event services grants include substate grantees and 58.21 other certified eligible organizations. Nonsubstate grantees 58.22 shall demonstrate they meet criteria established by the board, 58.23 in consultation with the workforce development council. The 58.24 criteria include, but are not limited to: 58.25 (1) the capacity to deliver worker adjustment services; 58.26 (2) an ability to coordinate its activities with substate 58.27 grantees in whose geographic area the organization will be 58.28 operating; 58.29 (3) the capability to coordinate delivery of worker 58.30 adjustment services with other appropriate programs and 58.31 agencies, including educational institutions, employment 58.32 service, human service agencies, and economic development 58.33 agencies; and 58.34 (4) sufficient administrative controls to ensure fiscal 58.35 accountability. 58.36 (b) For purposes of this section, the state job service may 59.1 apply directly to the board for a dislocation event services 59.2 grant only if the effect of a plant closing or substantial 59.3 layoff is statewide or results in the termination from 59.4 employment of employees of the state of Minnesota. 59.5 Subd. 3. [COVERAGE.] Persons who may receive worker 59.6 adjustment services under this section are limited to dislocated 59.7 workers affected by plant closings and substantial layoffs 59.8 involving at least 25 workers from a single employer. 59.9 Subd. 4. [FUNDING.] The board, in consultation with the 59.10 workforce development council, may establish an emergency 59.11 funding process for dislocation event services grants. No more 59.12 than 20 percent of the estimated budget of the proposed grant 59.13 may be awarded through this procedure. The grantee shall submit 59.14 a formal dislocation event services grant application within 90 59.15 days of the initial award of emergency funding. 59.16 Sec. 10. [116L.15] [RETRAINING AND TARGETED TRAINING 59.17 GRANTS.] 59.18 Subdivision 1. [ESTABLISHED.] The board may make grants to 59.19 substate grantees or other certified eligible organizations 59.20 designed to provide for the employment of dislocated workers or 59.21 targeted training assistance to workers at risk of dislocation. 59.22 The focus of the grants must be on the provision of skill-based 59.23 training required by the worker's employer or prospective 59.24 employer. The grants must be developed to meet the worker 59.25 training needs of employers individually or together. Two or 59.26 more organizations may jointly apply for a grant. 59.27 Subd. 2. [RETRAINING GRANTS.] An organization interested 59.28 in applying for a grant to retrain workers who are at risk of 59.29 becoming dislocated workers must apply to the board. As part of 59.30 the application process, an applicant must provide: 59.31 (1) a statement of need that identifies the causes 59.32 contributing to the workers being at risk of dislocation, the 59.33 prospects for reemployment of the workers in the employer's 59.34 industry or the worker's occupation, and the employer's past 59.35 record of permanently laying off workers; 59.36 (2) a description of the current skill level of the workers 60.1 targeted for training and the skills needed by the workers to 60.2 significantly reduce their vulnerability to becoming displaced 60.3 from employment; 60.4 (3) a description of the actions and investments made and 60.5 planned by the employer to avert or minimize worker dislocation, 60.6 including the adoption of high performance workplace and worker 60.7 participation systems and practices; 60.8 (4) a training plan that details who will receive training, 60.9 the type and scope of training assistance to be provided to 60.10 workers, the providers of the training, and any impact on worker 60.11 wages; 60.12 (5) evidence that the proposal has the support and 60.13 involvement of labor; and 60.14 (6) any other relevant information the board requires in 60.15 the grant application. 60.16 Subd. 3. [TARGETED TRAINING GRANTS.] An organization 60.17 interested in applying for a grant to target training for 60.18 dislocated workers being hired by an employer must apply to the 60.19 board. As part of the application process, applicants must 60.20 provide: 60.21 (1) a statement of need; 60.22 (2) a description of local labor market characteristics, 60.23 including the area's unemployment rate, types of workers 60.24 available to be employed in terms of occupation, and the local 60.25 availability of workers in the industry of the employer or 60.26 employers; 60.27 (3) a description of the actions and investments made and 60.28 planned by the employer or employers to create and retain jobs, 60.29 including past employment history, wages paid for the same or 60.30 similar work, and whether high performance workplace and worker 60.31 participation systems and practices have been adopted; 60.32 (4) a description of the type of work to be performed, the 60.33 work-related skills needed, projected wages, and the target 60.34 group of workers requiring the training assistance; 60.35 (5) a training plan that details who will receive training, 60.36 the type and scope of training assistance to be provided 61.1 workers, and the providers of the training; 61.2 (6) evidence that the proposal has the support and 61.3 involvement of labor; and 61.4 (7) any other relevant information the board requires in 61.5 the grant application. 61.6 Subd. 4. [CRITERIA.] The criteria used to award targeted 61.7 training grants must include the severity of need, the target 61.8 group of workers, training assistance, worker wages, utilization 61.9 of resources, cost-effectiveness, grantee management capability, 61.10 and other considerations adopted by the board. 61.11 Subd. 5. [COVERAGE.] Persons eligible to receive 61.12 retraining assistance under this section include workers at risk 61.13 of dislocation from employment and dislocated workers as defined 61.14 in section 116L.08, subdivision 3. Workers are considered to be 61.15 at risk of dislocation as evidenced by a pattern of worker 61.16 layoffs from an employer, a pattern of substantial layoffs or 61.17 plant closures in the same or related industry, or where worker 61.18 skills needed by the employer have become obsolete due to 61.19 advances in technology. 61.20 Subd. 6. [FUNDING.] The board may award retraining and 61.21 targeted training grants, if approved by the workforce 61.22 development council, through a request for proposal process if: 61.23 (1) employers benefiting from a retraining and targeted 61.24 training grant provide a match of at least one for one that may 61.25 be in the form of funding, equipment, staff, instructors, and 61.26 work release time for workers enrolled in training; 61.27 (2) employers benefiting from a retraining and targeted 61.28 training grant to retrain workers at risk of dislocation 61.29 maintain their past rate of expenditure from other sources for 61.30 that training during the grant period; and 61.31 (3) employers benefiting from a retraining and targeted 61.32 training grant to train new workers do not have workers in 61.33 layoff status, unless it can be documented the layoff is 61.34 temporary or seasonal. 61.35 Subd. 7. [LIMITATION.] No more than five percent of the 61.36 amount allocated to dislocated worker programs under section 62.1 116L.07, subdivision 2, clause (3), may be used for the grants 62.2 authorized under this section. 62.3 Sec. 11. [116L.16] [DISLOCATED WORKER COORDINATION.] 62.4 The board shall coordinate the actions taken by state 62.5 agencies and public post-secondary educational institutions to 62.6 respond to or address the specific needs of dislocated workers 62.7 and to provide services to dislocated workers including 62.8 education and retraining. The board shall also assist local 62.9 government units, community groups, business associations or 62.10 organizations, labor organizations, and others in coordinating 62.11 their efforts in providing services to dislocated workers. 62.12 Sec. 12. [116L.17] [PERFORMANCE STANDARDS, REPORTING, COST 62.13 LIMITATIONS.] 62.14 Subdivision 1. [PERFORMANCE STANDARDS.] The board shall 62.15 establish performance standards for the programs and activities 62.16 administered or funded under sections 116L.08 to 116L.17. The 62.17 board may use, when appropriate, existing federal performance 62.18 standards or, if the board determines that the federal standards 62.19 are inadequate or not suitable, may formulate new performance 62.20 standards to ensure that the programs and activities of the 62.21 dislocated worker program are effectively administered. 62.22 The board shall, at a minimum, establish performance 62.23 standards which appropriately gauge the program's effectiveness 62.24 at achieving the following objectives: 62.25 (1) placement of dislocated workers in employment; 62.26 (2) replacing lost income resulting from worker dislocation 62.27 from employment; 62.28 (3) early intervention with workers shortly after or 62.29 shortly before becoming displaced from employment; and 62.30 (4) retraining of workers from one occupation or industry 62.31 to another. 62.32 The standards shall be applied to plans or grants 62.33 authorized under sections 116L.13; 116L.14; and 116L.15 and for 62.34 other activities the board considers appropriate. 62.35 Subd. 2. [REPORTS.] (a) Grantees receiving funds under 62.36 sections 116L.11; 116L.12; 116L.13; and 116L.14 shall report to 63.1 the board information on program participants, activities 63.2 funded, and utilization of funds in a form and manner prescribed 63.3 by the board. 63.4 (b) The board shall report quarterly to the workforce 63.5 development council information on prefeasibility study grants 63.6 awarded, rapid response and expeditious response activities, 63.7 worker adjustment services plans, and dislocation event services 63.8 grants. Specific information to be reported shall be by 63.9 agreement between the board and the workforce development 63.10 council. 63.11 Subd. 3. [COST LIMITATIONS.] (a) For purposes of sections 63.12 116L.13 and 116L.14, funds allocated to a grantee are subject to 63.13 the following limitations: 63.14 (1) a maximum of 15 percent for administration in a worker 63.15 adjustment services plan or in a dislocation event services 63.16 grant; 63.17 (2) a minimum of 50 percent for provision of training 63.18 assistance; 63.19 (3) a minimum of ten percent and maximum of 30 percent for 63.20 provision of support services; and 63.21 (4) the balance used for provision of basic readjustment 63.22 assistance. 63.23 (b) A waiver of the cost limitation on providing training 63.24 assistance may be requested. The waiver may not permit less 63.25 than 30 percent of the funds be spent on training assistance. 63.26 (c) The board shall prescribe the form and manner for 63.27 submission of an application for a waiver under paragraph (b). 63.28 Criteria for granting a waiver shall be established by the 63.29 board, in consultation with the workforce development council. 63.30 Sec. 13. Minnesota Statutes 1998, section 268.022, is 63.31 amended to read: 63.32 268.022 [WORKFORCE INVESTMENT FUND.] 63.33 Subdivision 1. [DETERMINATION AND COLLECTION OF SPECIAL 63.34 ASSESSMENT.] (a) In addition to all other taxes, assessments, 63.35 and payment obligations under chapter 268, each employer, except 63.36 an employer making payments in lieu of taxes is liable for a 64.1 special assessment levied at the rate of one-tenth of one 64.2 percent per year on all taxable wages, as defined in section 64.3 268.04, subdivision 25b. The assessment shall become due and be 64.4 paid by each employer to the department on the same schedule and 64.5 in the same manner as other taxes. 64.6 (b) The special assessment levied under this section shall 64.7 not affect the computation of any other taxes, assessments, or 64.8 payment obligations due under this chapter. 64.9(c) Notwithstanding any provision to the contrary, if on64.10June 30 of any year the unobligated balance of the special64.11assessment fund under this section is greater than $30,000,000,64.12the special assessment for the following year only shall be64.13levied at a rate of 1/20th of one percent on all taxable wages.64.14 Subd. 2. [DISBURSEMENT OF SPECIAL ASSESSMENT FUNDS.] (a) 64.15 The money collected under this section shall be deposited in the 64.16 state treasury and credited toa dedicated fund to provide for64.17the employment and training programs established under sections64.18268.975 to 268.98; including vocational guidance, training,64.19placement, and job developmentthe Minnesota workforce 64.20 development fund created by section 116L.07. 64.21 (b)All money in the dedicated fund is appropriated to the64.22commissioner who must act as the fiscal agent for the money and64.23must disburse the money for the purposes of this section, not64.24allowing the money to be used for any other obligation of the64.25state. All money in the dedicated fund shall be deposited,64.26administered, and disbursed in the same manner and under the64.27same conditions and requirements as are provided by law for the64.28other dedicated funds in the state treasury, except that all64.29interest or net income resulting from the investment or deposit64.30of money in the fund shall accrue to the fund for the purposes64.31of the fund.64.32(c)No more than five percent of the dedicated funds 64.33 collected in each fiscal year may be used by the department of 64.34 economic security for its administrative costs. 64.35(d)(c) Reimbursement for costs related to collection of 64.36 the special assessment shall be in an amount negotiated between 65.1 the commissioner and the United States Department of Labor. 65.2(e) The dedicated funds, less amounts under paragraphs (c)65.3and (d) shall be allocated as follows:65.4(1) 40 percent to be allocated annually to substate65.5grantees for provision of expeditious response activities under65.6section 268.9771 and worker adjustment services under section65.7268.9781; and65.8(2) 60 percent to be allocated to activities and programs65.9authorized under sections 268.975 to 268.98.65.10(f) Any funds not allocated, obligated, or expended in a65.11fiscal year shall be available for allocation, obligation, and65.12expenditure in the following fiscal year.65.13 Sec. 14. [WORKFORCE DEVELOPMENT ANALYSIS.] 65.14 The office of strategic and long-range planning must 65.15 identify workforce training programs administered by state 65.16 agencies and by January 15, 2000, present a plan to the governor 65.17 and to the legislature that consolidates those programs and 65.18 provides for an economic development focus to that consolidated 65.19 program. 65.20 Sec. 15. [TRANSFER OF DISLOCATED WORKER PROGRAM FUNCTION 65.21 TO DEPARTMENT OF TRADE AND ECONOMIC DEVELOPMENT.] 65.22 The responsibility of the department of economic security 65.23 for the dislocated workers program under Minnesota Statutes, 65.24 sections 268.975 to 268.98 is transferred pursuant to section 65.25 15.039 to the jobs skills partnership board. 65.26 Sec. 16. [GOVERNOR'S DESIGNATION.] 65.27 The governor shall designate the jobs skills partnership 65.28 board as the responsible state agency for federal dislocated 65.29 worker programs. 65.30 Sec. 17. [FUND TRANSFER.] 65.31 The unobligated balance in the workforce investment 65.32 dedicated fund administered under Minnesota Statutes, section 65.33 268.022, subdivision 2, as of July 1, 1999, is transferred to 65.34 the Minnesota workforce development fund created by Minnesota 65.35 Statutes, section 116L.07. 65.36 Sec. 18. [APPROPRIATION.] 66.1 $29,000,000 is appropriated on July 1, 1999, from the 66.2 general fund to the workforce development fund created by 66.3 Minnesota Statutes, section 116L.07. 66.4 Sec. 19. [REPEALER.] 66.5 Minnesota Statutes 1998, sections 268.975; 268.976; 66.6 268.9771; 268.978; 268.9781; 268.9782; 268.9783; 268.979; and 66.7 268.98, are repealed. 66.8 ARTICLE 8 66.9 MINNESOTACARE TAXES 66.10 Section 1. Minnesota Statutes 1998, section 295.50, 66.11 subdivision 4, is amended to read: 66.12 Subd. 4. [HEALTH CARE PROVIDER.] (a) "Health care 66.13 provider" means: 66.14 (1) a person whose health care occupation is regulated or 66.15 required to be regulated by the state of Minnesota furnishing 66.16 any or all of the following goods or services directly to a 66.17 patient or consumer: medical, surgical, optical, visual, 66.18 dental, hearing, nursing services, drugs, laboratory, diagnostic 66.19 or therapeutic services; 66.20 (2) a person who provides goods and services not listed in 66.21 clause (1) that qualify for reimbursement under the medical 66.22 assistance program provided under chapter 256B; 66.23 (3) a staff model health plan company; 66.24 (4) an ambulance service required to be licensed; or 66.25 (5) a person who sells or repairs hearing aids and related 66.26 equipment or prescription eyewear. 66.27 (b) Health care provider does not include: (1) hospitals; 66.28 medical supplies distributors, except as specified under 66.29 paragraph (a), clause (5); nursing homes licensed under chapter 66.30 144A or licensed in any other jurisdiction; pharmacies; surgical 66.31 centers; bus and taxicab transportation, or any other providers 66.32 of transportation services other than ambulance services 66.33 required to be licensed; supervised living facilities for 66.34 persons with mental retardation or related conditions, licensed 66.35 under Minnesota Rules, parts 4665.0100 to 4665.9900; residential 66.36 care homes licensed under chapter 144B; board and lodging 67.1 establishments providing only custodial services that are 67.2 licensed under chapter 157 and registered under section 157.17 67.3 to provide supportive services or health supervision services; 67.4 adult foster homes as defined in Minnesota Rules, part 67.5 9555.5105; day training and habilitation services for adults 67.6 with mental retardation and related conditions as defined in 67.7 section 252.41, subdivision 3; and boarding care homes, as 67.8 defined in Minnesota Rules, part 4655.0100.; 67.9(c) For purposes of this subdivision, "directly to a67.10patient or consumer" includes goods and services provided in67.11connection with independent medical examinations under section67.1265B.56 or other examinations for purposes of litigation or67.13insurance claims.67.14 (2) home health agencies as defined in Minnesota Rules, 67.15 part 9505.0175, subpart 15; a person providing personal care 67.16 services and supervision of personal care services as defined in 67.17 Minnesota Rules, part 9505.0335; a person providing private duty 67.18 nursing services as defined in Minnesota Rules, part 9505.0360; 67.19 and home care providers required to be licensed under chapter 67.20 144A; 67.21 (3) a person who employs health care providers solely for 67.22 the purpose of providing patient services to its employees; and 67.23 (4) an educational institution that employs health care 67.24 providers solely for the purpose of providing patient services 67.25 to its students if the institution does not receive fee for 67.26 service payments or payments for extended coverage. 67.27 Sec. 2. Minnesota Statutes 1998, section 295.50, 67.28 subdivision 9b, is amended to read: 67.29 Subd. 9b. [PATIENT SERVICES.] (a) "Patient services" means 67.30 inpatient and outpatient services and other goods and services 67.31 provided by hospitals, surgical centers, or health care 67.32 providers. They include the following health care goods and 67.33 services provided to a patient or consumer: 67.34 (1) bed and board; 67.35 (2) nursing services and other related services; 67.36 (3) use of hospitals, surgical centers, or health care 68.1 provider facilities; 68.2 (4) medical social services; 68.3 (5) drugs, biologicals, supplies, appliances, and 68.4 equipment; 68.5 (6) other diagnostic or therapeutic items or services; 68.6 (7) medical or surgical services; 68.7 (8) items and services furnished to ambulatory patients not 68.8 requiring emergency care; 68.9 (9) emergency services;and68.10 (10) examinations, including but not limited to reviews of 68.11 medical records for the purpose of utilization reviews, 68.12 insurance claims or eligibility, litigation, and employment; and 68.13 (11) covered services listed in section 256B.0625 and in 68.14 Minnesota Rules, parts 9505.0170 to 9505.0475. 68.15 (b) "Patient services" does not include home health care 68.16 services. 68.17 Sec. 3. Minnesota Statutes 1998, section 295.53, 68.18 subdivision 1, is amended to read: 68.19 Subdivision 1. [EXEMPTIONS.] (a) The following payments 68.20 are excluded from the gross revenues subject to the hospital, 68.21 surgical center, or health care provider taxes under sections 68.22 295.50 to 295.57: 68.23 (1) payments received for services provided under the 68.24 Medicare program, including payments received from the 68.25 government, and organizations governed by sections 1833 and 1876 68.26 of title XVIII of the federal Social Security Act, United States 68.27 Code, title 42, section 1395, and enrollee deductibles, 68.28 coinsurance, and copayments, whether paid by the Medicare 68.29 enrollee or by a Medicare supplemental coverage as defined in 68.30 section 62A.011, subdivision 3, clause (10). Payments for 68.31 services not covered by Medicare are taxable; 68.32 (2) medical assistance payments including payments received 68.33 directly from the government or from a prepaid plan; 68.34 (3) payments received for home health care services; 68.35 (4) payments received from hospitals or surgical centers 68.36 for goods and services on which liability for tax is imposed 69.1 under section 295.52 or the source of funds for the payment is 69.2 exempt under clause (1), (2), (7), (8),or(10), or (13); 69.3 (5) payments received from health care providers for goods 69.4 and services on which liability for tax is imposed under this 69.5 chapter or the source of funds for the payment is exempt under 69.6 clause (1), (2), (7), (8),or(10), or (13); 69.7 (6) amounts paid for legend drugs, other than nutritional 69.8 products, to a wholesale drug distributor who is subject to tax 69.9 under section 295.52, subdivision 3, reduced by reimbursements 69.10 received for legend drugs under clauses (1), (2), (7), and (8); 69.11 (7) payments received under the general assistance medical 69.12 care program including payments received directly from the 69.13 government or from a prepaid plan; 69.14 (8) payments received for providing services under the 69.15 MinnesotaCare program including payments received directly from 69.16 the government or from a prepaid plan and enrollee deductibles, 69.17 coinsurance, and copayments. For purposes of this clause, 69.18 coinsurance means the portion of payment that the enrollee is 69.19 required to pay for the covered service; 69.20 (9) payments received by a health care provider or the 69.21 wholly owned subsidiary of a health care provider for care 69.22 provided outside Minnesotato a patient who is not domiciled in69.23Minnesota; 69.24 (10) payments received from the chemical dependency fund 69.25 under chapter 254B; 69.26 (11) payments received in the nature of charitable 69.27 donations that are not designated for providing patient services 69.28 to a specific individual or group; 69.29 (12) payments received for providing patient services 69.30 incurred through a formal program of health care research 69.31 conducted in conformity with federal regulations governing 69.32 research on human subjects. Payments received from patients or 69.33 from other persons paying on behalf of the patients are subject 69.34 to tax; 69.35 (13) payments received from any governmental agency for 69.36 services benefiting the public, not including payments made by 70.1 the government in its capacity as an employer or insurer; 70.2 (14) payments received for services provided by community 70.3 residential mental health facilities licensed under Minnesota 70.4 Rules, parts 9520.0500 to 9520.0690, community support programs 70.5 and family community support programs approved under Minnesota 70.6 Rules, parts 9535.1700 to 9535.1760, and community mental health 70.7 centers as defined in section 245.62, subdivision 2; 70.8 (15) government payments received by a regional treatment 70.9 center; 70.10 (16) payments received for hospice care services; 70.11 (17) payments received by a health care provider for 70.12 hearing aids and related equipment or prescription eyewear 70.13 delivered outside of Minnesota; 70.14 (18) payments received bya post-secondaryan educational 70.15 institution from student tuition, student activity fees, health 70.16 care service fees, government appropriations, donations, or 70.17 grants. Fee for service payments and payments for extended 70.18 coverage are taxable;and70.19 (19) payments received for services provided by: assisted 70.20 living programs and congregate housing programs; and 70.21 (20) payments received from nursing homes licensed under 70.22 chapter 144A for services provided to a nursing home. 70.23 (b) Payments received by wholesale drug distributors for 70.24 legend drugs sold directly to veterinarians or veterinary bulk 70.25 purchasing organizations are excluded from the gross revenues 70.26 subject to the wholesale drug distributor tax under sections 70.27 295.50 to 295.59. 70.28 Sec. 4. Minnesota Statutes 1998, section 295.55, 70.29 subdivision 2, is amended to read: 70.30 Subd. 2. [ESTIMATED TAX; HOSPITALS; SURGICAL CENTERS.] (a) 70.31 Each hospital or surgical center must make estimated payments of 70.32 the taxes for the calendar year in monthly installments to the 70.33 commissioner within 15 days after the end of the month. 70.34 (b) Estimated tax payments are not required of hospitals or 70.35 surgical centers if: (1) the tax for the current calendar year 70.36 is less than $500; or (2) the tax for the previous calendar year 71.1 is less than $500, if the taxpayer had a tax liability and was 71.2 doing business the entire year; or (3) if a hospital has been 71.3 allowed a grant under section 144.1484, subdivision 2, for the 71.4 year. 71.5 (c) Underpayment of estimated installments bear interest at 71.6 the rate specified in section 270.75, from the due date of the 71.7 payment until paid or until the due date of the annual returnat71.8the rate specified in section 270.75whichever comes first. An 71.9 underpayment of an estimated installment is the difference 71.10 between the amount paid and the lesser of (1) 90 percent of 71.11 one-twelfth of the tax for the calendar year or (2) one-twelfth 71.12 of the total tax for theactual gross revenues received during71.13the monthprevious calendar year if the taxpayer had a tax 71.14 liability and was doing business the entire year. 71.15 Sec. 5. Minnesota Statutes 1998, section 295.55, 71.16 subdivision 3, is amended to read: 71.17 Subd. 3. [ESTIMATED TAX; OTHER TAXPAYERS.] (a) Each 71.18 taxpayer, other than a hospital or surgical center, must make 71.19 estimated payments of the taxes for the calendar year in 71.20 quarterly installments to the commissioner by April 15, July 15, 71.21 October 15, and January 15 of the following calendar year. 71.22 (b) Estimated tax payments are not required if: (1) the 71.23 tax for the current calendar year is less than $500; or (2) the 71.24 tax for the previous calendar year is less than $500, if the 71.25 taxpayer had a tax liability and was doing business the entire 71.26 year. 71.27 (c) Underpayment of estimated installments bear interest at 71.28 the rate specified in section 270.75, from the due date of the 71.29 payment until paid or until the due date of the annual returnat71.30the rate specified in section 270.75whichever comes first. An 71.31 underpayment of an estimated installment is the difference 71.32 between the amount paid and the lesser of (1) 90 percent of 71.33 one-quarter of the tax for the calendar year or (2) one-quarter 71.34 of the total tax for theactual gross revenues received during71.35the quarterprevious calendar year if the taxpayer had a tax 71.36 liability and was doing business the entire year. 72.1 Sec. 6. Minnesota Statutes 1998, section 295.57, is 72.2 amended by adding a subdivision to read: 72.3 Subd. 4. [SAMPLING TECHNIQUES.] The commissioner may use 72.4 statistical or other sampling techniques consistent with 72.5 generally accepted auditing standards in examining returns or 72.6 records and making assessments. 72.7 Sec. 7. [EFFECTIVE DATE.] 72.8 Sections 1, 3, 4, and 5 are effective for payments received 72.9 on or after January 1, 2000. Sections 2 and 6 are effective the 72.10 day following final enactment. 72.11 ARTICLE 9 72.12 PROPERTY TAX 72.13 Section 1. [103F.002] [COLLECTION OF PENALTIES.] 72.14 If a penalty imposed for violation of an ordinance enacted 72.15 under this chapter is unpaid for more than 60 days after the 72.16 date when payment is due, the local government unit that imposed 72.17 the penalty may certify the delinquent penalty, together with 72.18 any interest and additional penalties that apply to it, to the 72.19 county auditor for collection to the same extent and in the same 72.20 manner provided by law for the assessment and collection of real 72.21 estate taxes. 72.22 Sec. 2. Minnesota Statutes 1998, section 204B.135, is 72.23 amended by adding a subdivision to read: 72.24 Subd. 5. [REDISTRICTING EXPENSES.] The county board may 72.25 levy a tax not to exceed $1 per capita in the year ending in "0" 72.26 to pay costs incurred in the year ending in "1" or "2" that are 72.27 reasonably related to the redistricting of election districts, 72.28 establishment of precinct boundaries, designation of polling 72.29 places, and the updating of voter records in the statewide 72.30 registration system. The county auditor shall distribute to 72.31 each municipality in the county on a per capita basis 25 percent 72.32 of the amount levied as provided in this subdivision, based on 72.33 the population of the municipality in the most recent census. 72.34 This levy is not subject to statutory levy limits. 72.35 Sec. 3. Minnesota Statutes 1998, section 270.07, 72.36 subdivision 1, is amended to read: 73.1 Subdivision 1. [POWERS OF COMMISSIONER; APPLICATION FOR 73.2 ABATEMENT; ORDERS.] (a) The commissioner of revenue shall 73.3 prescribe the form of all blanks and books required under this 73.4 chapter and shall hear and determine all matters of grievance 73.5 relating to taxation. Except for matters delegated to the 73.6 various boards of county commissioners under section 375.192, 73.7 and except as otherwise provided by law, the commissioner shall 73.8 have power to grant such reduction or abatement of net tax 73.9 capacities or taxes and of any costs, penalties or interest 73.10 thereon as the commissioner may deem just and equitable, and to 73.11 order the refundment, in whole or in part, of any taxes, costs, 73.12 penalties or interest thereon which have been erroneously or 73.13 unjustly paid. Application therefor shall be submitted with a 73.14 statement of facts in the case and the favorable recommendation 73.15 of the county board or of the board of abatement of any city 73.16 where any such board exists, and the county auditor of the 73.17 county wherein such tax was levied or paid. In the case of taxes 73.18 other than gross earnings taxes, the order may be made only on 73.19 application and approval as provided in this paragraph. No 73.20 reduction, abatement, or refundment of any special assessments 73.21 made or levied by any municipality for local improvements shall 73.22 be made unless it is also approved by the board of review or 73.23 similar taxing authority of such municipality. 73.24 (b) The commissioner has the power to grant reductions or 73.25 abatements of gross earnings tax. An application for reduction 73.26 of gross earnings taxes may be made directly to the commissioner 73.27 without the favorable action of the county board and county 73.28 auditor. The commissioner shall direct that any gross earnings 73.29 taxes that may have been erroneously or unjustly paid be applied 73.30 against unpaid taxes due from the applicant. 73.31 (c) The commissioner shall forward to the county auditor a 73.32 copy of the order made by the commissioner in all cases in which 73.33 the approval of the county board is required. 73.34 (d) The commissioner may refer any question that may arise 73.35 in reference to the true construction of this chapter to the 73.36 attorney general, and the decision thereon shall be in force and 74.1 effect until annulled by the judgment of a court of competent 74.2 jurisdiction. 74.3 (e) The commissioner may by written order abate, reduce, or 74.4 refund any penalty or interest imposed by any law relating to 74.5 taxation, if in the commissioner's opinion the failure to timely 74.6 pay the tax or failure to timely file the return is due to 74.7 reasonable cause, or if the taxpayer is located in a 74.8 presidentially declared disaster area.The order shall be made74.9on application of the taxpayer to the commissioner.74.10(f) If an order issued under this subdivision is for an74.11abatement, reduction, or refund of over $5,000, it shall be74.12valid only if approved in writing by the attorney general.74.13(g)(f) An appeal may not be taken to the tax court from 74.14 any order of the commissioner of revenue made in the exercise of 74.15 the discretionary authority granted in paragraph (a) with 74.16 respect to the reduction or abatement of real or personal 74.17 property taxes in response to a taxpayer's application for an 74.18 abatement, reduction, or refund of taxes, net tax capacities, 74.19 costs, penalties, or interest. 74.20 Sec. 4. Minnesota Statutes 1998, section 272.02, 74.21 subdivision 1, is amended to read: 74.22 Subdivision 1. [EXEMPT PROPERTY DESCRIBED.] All property 74.23 described in this section to the extent herein limited shall be 74.24 exempt from taxation: 74.25 (1) All public burying grounds. 74.26 (2) All public schoolhouses. 74.27 (3) All public hospitals. 74.28 (4) All academies, colleges, and universities, and all 74.29 seminaries of learning. 74.30 (5) All churches, church property, and houses of worship. 74.31 (6) Institutions of purely public charity except parcels of 74.32 property containing structures and the structures described in 74.33 section 273.13, subdivision 25, paragraph (e), other than those 74.34 that qualify for exemption under clause (25). 74.35 (7) All public property exclusively used for any public 74.36 purpose. 75.1 (8) Except for the taxable personal property enumerated 75.2 below, all personal property and the property described in 75.3 section 272.03, subdivision 1, paragraphs (c) and (d), shall be 75.4 exempt. 75.5 The following personal property shall be taxable: 75.6 (a) personal property which is part of an electric 75.7 generating, transmission, or distribution system or a pipeline 75.8 system transporting or distributing water, gas, crude oil, or 75.9 petroleum products or mains and pipes used in the distribution 75.10 of steam or hot or chilled water for heating or cooling 75.11 buildings and structures; 75.12 (b) railroad docks and wharves which are part of the 75.13 operating property of a railroad company as defined in section 75.14 270.80; 75.15 (c) personal property defined in section 272.03, 75.16 subdivision 2, clause (3); 75.17 (d) leasehold or other personal property interests which 75.18 are taxed pursuant to section 272.01, subdivision 2; 273.124, 75.19 subdivision 7; or 273.19, subdivision 1; or any other law 75.20 providing the property is taxable as if the lessee or user were 75.21 the fee owner; 75.22 (e) manufactured homes and sectional structures, including 75.23 storage sheds, decks, and similar removable improvements 75.24 constructed on the site of a manufactured home, sectional 75.25 structure, park trailer or travel trailer as provided in section 75.26 273.125, subdivision 8, paragraph (f); and 75.27 (f) flight property as defined in section 270.071. 75.28 (9) Personal property used primarily for the abatement and 75.29 control of air, water, or land pollution to the extent that it 75.30 is so used, and real property which is used primarily for 75.31 abatement and control of air, water, or land pollution as part 75.32 of an agricultural operation, as a part of a centralized 75.33 treatment and recovery facility operating under a permit issued 75.34 by the Minnesota pollution control agency pursuant to chapters 75.35 115 and 116 and Minnesota Rules, parts 7001.0500 to 7001.0730, 75.36 and 7045.0020 to 7045.1260, as a wastewater treatment facility 76.1 and for the treatment, recovery, and stabilization of metals, 76.2 oils, chemicals, water, sludges, or inorganic materials from 76.3 hazardous industrial wastes, or as part of an electric 76.4 generation system. For purposes of this clause, personal 76.5 property includes ponderous machinery and equipment used in a 76.6 business or production activity that at common law is considered 76.7 real property. 76.8 Any taxpayer requesting exemption of all or a portion of 76.9 any real property or any equipment or device, or part thereof, 76.10 operated primarily for the control or abatement of air or water 76.11 pollution shall file an application with the commissioner of 76.12 revenue. The equipment or device shall meet standards, rules, 76.13 or criteria prescribed by the Minnesota pollution control 76.14 agency, and must be installed or operated in accordance with a 76.15 permit or order issued by that agency. The Minnesota pollution 76.16 control agency shall upon request of the commissioner furnish 76.17 information or advice to the commissioner. On determining that 76.18 property qualifies for exemption, the commissioner shall issue 76.19 an order exempting the property from taxation. The equipment or 76.20 device shall continue to be exempt from taxation as long as the 76.21 permit issued by the Minnesota pollution control agency remains 76.22 in effect. 76.23 (10) Wetlands. For purposes of this subdivision, 76.24 "wetlands" means: (i) land described in section 103G.005, 76.25 subdivision 15a; (ii) land which is mostly under water, produces 76.26 little if any income, and has no use except for wildlife or 76.27 water conservation purposes, provided it is preserved in its 76.28 natural condition and drainage of it would be legal, feasible, 76.29 and economically practical for the production of livestock, 76.30 dairy animals, poultry, fruit, vegetables, forage and grains, 76.31 except wild rice; or (iii) land in a wetland preservation area 76.32 under sections 103F.612 to 103F.616. "Wetlands" under items (i) 76.33 and (ii) include adjacent land which is not suitable for 76.34 agricultural purposes due to the presence of the wetlands, but 76.35 do not include woody swamps containing shrubs or trees, wet 76.36 meadows, meandered water, streams, rivers, and floodplains or 77.1 river bottoms. Exemption of wetlands from taxation pursuant to 77.2 this section shall not grant the public any additional or 77.3 greater right of access to the wetlands or diminish any right of 77.4 ownership to the wetlands. 77.5 (11) Native prairie. The commissioner of the department of 77.6 natural resources shall determine lands in the state which are 77.7 native prairie and shall notify the county assessor of each 77.8 county in which the lands are located. Pasture land used for 77.9 livestock grazing purposes shall not be considered native 77.10 prairie for the purposes of this clause. Upon receipt of an 77.11 application for the exemption provided in this clause for lands 77.12 for which the assessor has no determination from the 77.13 commissioner of natural resources, the assessor shall refer the 77.14 application to the commissioner of natural resources who shall 77.15 determine within 30 days whether the land is native prairie and 77.16 notify the county assessor of the decision. Exemption of native 77.17 prairie pursuant to this clause shall not grant the public any 77.18 additional or greater right of access to the native prairie or 77.19 diminish any right of ownership to it. 77.20 (12) Property used in a continuous program to provide 77.21 emergency shelter for victims of domestic abuse, provided the 77.22 organization that owns and sponsors the shelter is exempt from 77.23 federal income taxation pursuant to section 501(c)(3) of the 77.24 Internal Revenue Code of 1986, as amended through December 31, 77.25 1992, notwithstanding the fact that the sponsoring organization 77.26 receives funding under section 8 of the United States Housing 77.27 Act of 1937, as amended. 77.28 (13) If approved by the governing body of the municipality 77.29 in which the property is located, property not exceeding one 77.30 acre which is owned and operated by any senior citizen group or 77.31 association of groups that in general limits membership to 77.32 persons age 55 or older and is organized and operated 77.33 exclusively for pleasure, recreation, and other nonprofit 77.34 purposes, no part of the net earnings of which inures to the 77.35 benefit of any private shareholders; provided the property is 77.36 used primarily as a clubhouse, meeting facility, or recreational 78.1 facility by the group or association and the property is not 78.2 used for residential purposes on either a temporary or permanent 78.3 basis. 78.4 (14) To the extent provided by section 295.44, real and 78.5 personal property used or to be used primarily for the 78.6 production of hydroelectric or hydromechanical power on a site 78.7 owned by the federal government, the state, or a local 78.8 governmental unit which is developed and operated pursuant to 78.9 the provisions of section 103G.535. 78.10 (15) If approved by the governing body of the municipality 78.11 in which the property is located, and if construction is 78.12 commenced after June 30, 1983: 78.13 (a) a "direct satellite broadcasting facility" operated by 78.14 a corporation licensed by the federal communications commission 78.15 to provide direct satellite broadcasting services using direct 78.16 broadcast satellites operating in the 12-ghz. band; and 78.17 (b) a "fixed satellite regional or national program service 78.18 facility" operated by a corporation licensed by the federal 78.19 communications commission to provide fixed satellite-transmitted 78.20 regularly scheduled broadcasting services using satellites 78.21 operating in the 6-ghz. band. 78.22 An exemption provided by clause (15) shall apply for a period 78.23 not to exceed five years. When the facility no longer qualifies 78.24 for exemption, it shall be placed on the assessment rolls as 78.25 provided in subdivision 4. Before approving a tax exemption 78.26 pursuant to this paragraph, the governing body of the 78.27 municipality shall provide an opportunity to the members of the 78.28 county board of commissioners of the county in which the 78.29 facility is proposed to be located and the members of the school 78.30 board of the school district in which the facility is proposed 78.31 to be located to meet with the governing body. The governing 78.32 body shall present to the members of those boards its estimate 78.33 of the fiscal impact of the proposed property tax exemption. 78.34 The tax exemption shall not be approved by the governing body 78.35 until the county board of commissioners has presented its 78.36 written comment on the proposal to the governing body or 30 days 79.1 have passed from the date of the transmittal by the governing 79.2 body to the board of the information on the fiscal impact, 79.3 whichever occurs first. 79.4 (16) Real and personal property owned and operated by a 79.5 private, nonprofit corporation exempt from federal income 79.6 taxation pursuant to United States Code, title 26, section 79.7 501(c)(3), primarily used in the generation and distribution of 79.8 hot water for heating buildings and structures. 79.9 (17) Notwithstanding section 273.19, state lands that are 79.10 leased from the department of natural resources under section 79.11 92.46. 79.12 (18) Electric power distribution lines and their 79.13 attachments and appurtenances, that are used primarily for 79.14 supplying electricity to farmers at retail. 79.15 (19) Transitional housing facilities. "Transitional 79.16 housing facility" means a facility that meets the following 79.17 requirements. (i) It provides temporary housing to individuals, 79.18 couples, or families. (ii) It has the purpose of reuniting 79.19 families and enabling parents or individuals to obtain 79.20 self-sufficiency, advance their education, get job training, or 79.21 become employed in jobs that provide a living wage. (iii) It 79.22 provides support services such as child care, work readiness 79.23 training, and career development counseling; and a 79.24 self-sufficiency program with periodic monitoring of each 79.25 resident's progress in completing the program's goals. (iv) It 79.26 provides services to a resident of the facility for at least 79.27 three months but no longer than three years, except residents 79.28 enrolled in an educational or vocational institution or job 79.29 training program. These residents may receive services during 79.30 the time they are enrolled but in no event longer than four 79.31 years. (v) It is owned and operated or under lease from a unit 79.32 of government or governmental agency under a property 79.33 disposition program and operated by one or more organizations 79.34 exempt from federal income tax under section 501(c)(3) of the 79.35 Internal Revenue Code of 1986, as amended through December 31, 79.36 1992. This exemption applies notwithstanding the fact that the 80.1 sponsoring organization receives financing by a direct federal 80.2 loan or federally insured loan or a loan made by the Minnesota 80.3 housing finance agency under the provisions of either Title II 80.4 of the National Housing Act or the Minnesota Housing Finance 80.5 Agency Law of 1971 or rules promulgated by the agency pursuant 80.6 to it, and notwithstanding the fact that the sponsoring 80.7 organization receives funding under Section 8 of the United 80.8 States Housing Act of 1937, as amended. 80.9 (20) Real and personal property, including leasehold or 80.10 other personal property interests, owned and operated by a 80.11 corporation if more than 50 percent of the total voting power of 80.12 the stock of the corporation is owned collectively by: (i) the 80.13 board of regents of the University of Minnesota, (ii) the 80.14 University of Minnesota Foundation, an organization exempt from 80.15 federal income taxation under section 501(c)(3) of the Internal 80.16 Revenue Code of 1986, as amended through December 31, 1992, and 80.17 (iii) a corporation organized under chapter 317A, which by its 80.18 articles of incorporation is prohibited from providing pecuniary 80.19 gain to any person or entity other than the regents of the 80.20 University of Minnesota; which property is used primarily to 80.21 manage or provide goods, services, or facilities utilizing or 80.22 relating to large-scale advanced scientific computing resources 80.23 to the regents of the University of Minnesota and others. 80.24 (21)(a) Small scale wind energy conversion systems 80.25 installed after January 1, 1991, and used as an electric power 80.26 source are exempt. 80.27 "Small scale wind energy conversion systems" are wind 80.28 energy conversion systems, as defined in section 216C.06, 80.29 subdivision 12, including the foundation or support pad, which 80.30 are (i) used as an electric power source; (ii) located within 80.31 one county and owned by the same owner; and (iii) produce two 80.32 megawatts or less of electricity as measured by nameplate 80.33 ratings. 80.34 (b) Medium scale wind energy conversion systems installed 80.35 after January 1, 1991, are treated as follows: (i) the 80.36 foundation and support pad are taxable; (ii) the associated 81.1 supporting and protective structures are exempt for the first 81.2 five assessment years after they have been constructed, and 81.3 thereafter, 30 percent of the market value of the associated 81.4 supporting and protective structures are taxable; and (iii) the 81.5 turbines, blades, transformers, and its related equipment, are 81.6 exempt. "Medium scale wind energy conversion systems" are wind 81.7 energy conversion systems as defined in section 216C.06, 81.8 subdivision 12, including the foundation or support pad, which 81.9 are: (i) used as an electric power source; (ii) located within 81.10 one county and owned by the same owner; and (iii) produce more 81.11 than two but equal to or less than 12 megawatts of energy as 81.12 measured by nameplate ratings. 81.13 (c) Large scale wind energy conversion systems installed 81.14 after January 1, 1991, are treated as follows: 25 percent of 81.15 the market value of all property is taxable, including (i) the 81.16 foundation and support pad; (ii) the associated supporting and 81.17 protective structures; and (iii) the turbines, blades, 81.18 transformers, and its related equipment. "Large scale wind 81.19 energy conversion systems" are wind energy conversion systems as 81.20 defined in section 216C.06, subdivision 12, including the 81.21 foundation or support pad, which are: (i) used as an electric 81.22 power source; and (ii) produce more than 12 megawatts of energy 81.23 as measured by nameplate ratings. 81.24 (22) Containment tanks, cache basins, and that portion of 81.25 the structure needed for the containment facility used to 81.26 confine agricultural chemicals as defined in section 18D.01, 81.27 subdivision 3, as required by the commissioner of agriculture 81.28 under chapter 18B or 18C. 81.29 (23) Photovoltaic devices, as defined in section 216C.06, 81.30 subdivision 13, installed after January 1, 1992, and used to 81.31 produce or store electric power. 81.32 (24) Real and personal property owned and operated by a 81.33 private, nonprofit corporation exempt from federal income 81.34 taxation pursuant to United States Code, title 26, section 81.35 501(c)(3), primarily used for an ice arena or ice rink, and used 81.36 primarily for youth and high school programs. 82.1 (25) A structure that is situated on real property that is 82.2 used for: 82.3 (i) housing for the elderly or for low- and moderate-income 82.4 families as defined in Title II of the National Housing Act, as 82.5 amended through December 31, 1990, and funded by a direct 82.6 federal loan or federally insured loan made pursuant to Title II 82.7 of the act; or 82.8 (ii) housing lower income families or elderly or 82.9 handicapped persons, as defined in Section 8 of the United 82.10 States Housing Act of 1937, as amended. 82.11 In order for a structure to be exempt under item (i) or 82.12 (ii), it must also meet each of the following criteria: 82.13 (A) is owned by an entity which is operated as a nonprofit 82.14 corporation organized under chapter 317A; 82.15 (B) is owned by an entity which has not entered into a 82.16 housing assistance payments contract under Section 8 of the 82.17 United States Housing Act of 1937, or, if the entity which owns 82.18 the structure has entered into a housing assistance payments 82.19 contract under Section 8 of the United States Housing Act of 82.20 1937, the contract provides assistance for less than 90 percent 82.21 of the dwelling units in the structure, excluding dwelling units 82.22 intended for management or maintenance personnel; 82.23 (C) operates an on-site congregate dining program in which 82.24 participation by residents is mandatory, and provides assisted 82.25 living or similar social and physical support services for 82.26 residents; and 82.27 (D) was not assessed and did not pay tax under chapter 273 82.28 prior to the 1991 levy, while meeting the other conditions of 82.29 this clause. 82.30 An exemption under this clause remains in effect for taxes 82.31 levied in each year or partial year of the term of its permanent 82.32 financing. 82.33 (26) Real and personal property that is located in the 82.34 Superior National Forest, and owned or leased and operated by a 82.35 nonprofit organization that is exempt from federal income 82.36 taxation under section 501(c)(3) of the Internal Revenue Code of 83.1 1986, as amended through December 31, 1992, and primarily used 83.2 to provide recreational opportunities for disabled veterans and 83.3 their families. 83.4 (27) Manure pits and appurtenances, which may include 83.5 slatted floors and pipes, installed or operated in accordance 83.6 with a permit, order, or certificate of compliance issued by the 83.7 Minnesota pollution control agency. The exemption shall 83.8 continue for as long as the permit, order, or certificate issued 83.9 by the Minnesota pollution control agency remains in effect. 83.10 (28) Notwithstanding clause (8), item (a), attached 83.11 machinery and other personal property which is part of a 83.12 facility containing a cogeneration system as described in 83.13 section 216B.166, subdivision 2, paragraph (a), if the 83.14 cogeneration system has met the following criteria: (i) the 83.15 system utilizes natural gas as a primary fuel and the 83.16 cogenerated steam initially replaces steam generated from 83.17 existing thermal boilers utilizing coal; (ii) the facility 83.18 developer is selected as a result of a procurement process 83.19 ordered by the public utilities commission; and (iii) 83.20 construction of the facility is commenced after July 1, 1994, 83.21 and before July 1, 1997. 83.22 (29) Real property acquired by a home rule charter city, 83.23 statutory city, county, town, or school district under a lease 83.24 purchase agreement or an installment purchase contract during 83.25 the term of the lease purchase agreement as long as and to the 83.26 extent that the property is used by the city, county, town, or 83.27 school district and devoted to a public use and to the extent it 83.28 is not subleased to any private individual, entity, association, 83.29 or corporation in connection with a business or enterprise 83.30 operated for profit. 83.31 (30) Property owned by a nonprofit charitable organization 83.32 that qualifies for tax exemption under section 501(c)(3) of the 83.33 Internal Revenue Code of 1986, as amended through December 31, 83.34 1997, that is intended to be used as a business incubator in a 83.35 high-unemployment countybut is not occupied on the assessment83.36date. As used in this clause, a "business incubator" is a 84.1 facility used for the development of nonretail businesses, 84.2 offering access to equipment, space, services, and advice to the 84.3 tenant businesses, for the purpose of encouraging economic 84.4 development, diversification, and job creation in the area 84.5 served by the organization, and "high-unemployment county" is a 84.6 county that had an average annual unemployment rate of 7.9 84.7 percent or greater in 1997. Property that qualifies for the 84.8 exemption under this clause is limited to no more than two 84.9 contiguous parcels and structures that do not exceed in the 84.10 aggregate 40,000 square feet. This exemption expires after 84.11 taxes payable in 2005. 84.12 (31) Notwithstanding any other law to the contrary, real 84.13 property that meets the following criteria is exempt: 84.14 (i) constitutes a wastewater treatment system (a) 84.15 constructed by a municipality using public funds, (b) operates 84.16 under a State Disposal System Permit issued by the Minnesota 84.17 pollution control agency pursuant to chapters 115 and 116 and 84.18 Minnesota Rules, chapter 700l, and (c) applies its effluent to 84.19 land used as part of an agricultural operation; 84.20 (ii) is located within a municipality of a population of 84.21 less than 10,000; 84.22 (iii) is used for treatment of effluent from a private 84.23 potato processing facility; and 84.24 (iv) is owned by a municipality and operated by a private 84.25 entity under agreement with that municipality. 84.26 (32) Notwithstanding clause (8), item (a), attached 84.27 machinery and other personal property which is part of a 84.28 simple-cycle combustion-turbine electric generation facility 84.29 that exceeds 250 megawatts of installed capacity and that meets 84.30 the requirements of this clause. At the time of construction, 84.31 the facility must: 84.32 (i) not be owned by a public utility as defined in section 84.33 216B.02, subdivision 4; 84.34 (ii) utilize natural gas as a primary fuel; 84.35 (iii) be located within 20 miles of the intersection of an 84.36 existing 42-inch (outside diameter) natural gas pipeline and a 85.1 345-kilovolt high-voltage electric transmission line; and 85.2 (iv) be designed to provide peaking, emergency backup, or 85.3 contingency services, and have received a certificate of need 85.4 pursuant to section 216B.243 demonstrating demand for its 85.5 capacity. 85.6 Construction of the facility must be commenced after July 1, 85.7 1999, and before July 1, 2003. Property eligible for this 85.8 exemption does not include electric transmission lines and 85.9 interconnections or gas pipelines and interconnections 85.10 appurtenant to the property or the facility. 85.11 Sec. 5. Minnesota Statutes 1998, section 272.027, is 85.12 amended to read: 85.13 272.027 [PERSONAL PROPERTY USED TO GENERATE ELECTRICITY FOR 85.14 PRODUCTION AND RESALE.] 85.15 Subdivision 1. [ELECTRICITY GENERATED TO PRODUCE GOODS AND 85.16 SERVICES.] Personal property used to generate electric power is 85.17 exempt from property taxation if the electric power is used to 85.18 manufacture or produce goods, products, or services, other than 85.19 electric power, by the owner of the electric generation 85.20 plant. Except as provided in subdivision 2, the exemption does 85.21 not apply to property used to produce electric power for sale to 85.22 others and does not apply to real property. In determining the 85.23 value subject to tax, a proportionate share of the value of the 85.24 generating facilities, equal to the proportion that the power 85.25 sold to others bears to the total generation of the plant, is 85.26 subject to the general property tax in the same manner as other 85.27 property. Power generated in such a plant and exchanged for an 85.28 equivalent amount of power that is used for the manufacture or 85.29 production of goods, products, or services other than electric 85.30 power by the owner of the generating plant is considered to be 85.31 used by the owner of the plant. 85.32 Subd. 2. [EXEMPTION FOR CUSTOMER OWNED PROPERTY 85.33 TRANSFERRED TO A UTILITY.] (a) Tools, implements, and machinery 85.34 of an electric generating facility are exempt if all the 85.35 following requirements are met: 85.36 (1) the electric generating facilities were operational and 86.1 met the requirements for exemption of personal property under 86.2 subdivision 1 on January 2, 1999; and 86.3 (2) the generating facility is sold to a Minnesota electric 86.4 utility before July 2001. 86.5 (b) Any tools, implements, and machinery used to increase 86.6 generation capacity that are installed by a utility at a 86.7 facility at which tools, implements, and machinery are exempt 86.8 under paragraph (a) are also exempt under this section. 86.9 Sec. 6. Minnesota Statutes 1998, section 272.03, 86.10 subdivision 6, is amended to read: 86.11 Subd. 6. [TRACT, LOT, PARCEL, AND PIECE OR PARCEL.] 86.12 (a) "Tract," "lot," "parcel," and "piece or parcel" of land 86.13 means any contiguous quantity of land in the possession of, 86.14 owned by, or recorded as the property of, the same claimant or 86.15 person. 86.16 (b) Notwithstanding paragraph (a), property that is owned 86.17 by a utility, leased for residential or recreational uses for 86.18 terms of 20 years or longer, and separately valued by the 86.19 assessor, will be treated for property tax purposes as separate 86.20 parcels. 86.21 Sec. 7. Minnesota Statutes 1998, section 272.67, is 86.22 amended by adding a subdivision to read: 86.23 Subd. 9. [DIVISION INTO URBAN AND RURAL SERVICE 86.24 DISTRICTS.] Notwithstanding the provisions of subdivisions 1 and 86.25 6, in order to carry out an orderly annexation agreement entered 86.26 into on or after August 16, 1996, a city may divide its area 86.27 into urban service districts and rural service districts 86.28 constituting separate taxing districts for the purpose of all 86.29 municipal property taxes including those levied for the payment 86.30 of bonds and judgments and interest on them. 86.31 Sec. 8. Minnesota Statutes 1998, section 273.11, 86.32 subdivision 16, is amended to read: 86.33 Subd. 16. [VALUATION EXCLUSION FOR CERTAIN IMPROVEMENTS.] 86.34 Improvements to homestead property made before January 2, 2003, 86.35 shall be fully or partially excluded from the value of the 86.36 property for assessment purposes provided that (1) the house is 87.1 at least 35 years old at the time of the improvement and (2) 87.2 either 87.3 (a) the assessor's estimated market value of the house on 87.4 January 2 of the current year is equal to or less than $150,000, 87.5 or 87.6 (b) if the estimated market value of the house is over 87.7 $150,000 market value but is less than $300,000 on January 2 of 87.8 the current year, the property qualifies if 87.9 (i) it is located in a city or town in which 50 percent or 87.10 more of the owner-occupied housing units were constructed before 87.11 1960 based upon the 1990 federal census, and 87.12 (ii) the city or town's median family income based upon the 87.13 1990 federal census is less than the statewide median family 87.14 income based upon the 1990 federal census, or 87.15 (c) if the estimated market value of the house is $300,000 87.16 or more on January 2 of the current year, the property qualifies 87.17 if 87.18 (i) it is located in a city or town in which 45 percent or 87.19 more of the homes were constructed before 1940 based upon the 87.20 1990 federal census, and 87.21 (ii) it is located in a city or town in which 45 percent or 87.22 more of the housing units were rental based upon the 1990 87.23 federal census, and 87.24 (iii) the city or town's median value of owner-occupied 87.25 housing units based upon the 1990 federal census is less than 87.26 the statewide median value of owner-occupied housing units based 87.27 upon the 1990 federal census. 87.28 For purposes of determining this eligibility, "house" means 87.29 land and buildings. 87.30 The age of a residence is the number of years since the 87.31 original year of its construction. In the case of a residence 87.32 that is relocated, the relocation must be from a location within 87.33 the state and the only improvements eligible for exclusion under 87.34 this subdivision are (1) those for which building permits were 87.35 issued to the homeowner after the residence was relocated to its 87.36 present site, and (2) those undertaken during or after the year 88.1 the residence is initially occupied by the homeowner, excluding 88.2 any market value increase relating to basic improvements that 88.3 are necessary to install the residence on its foundation and 88.4 connect it to utilities at its present site. In the case of an 88.5 owner-occupied duplex or triplex, the improvement is eligible 88.6 regardless of which portion of the property was improved. 88.7 If the property lies in a jurisdiction which is subject to 88.8 a building permit process, a building permit must have been 88.9 issued prior to commencement of the improvement. Any 88.10 improvement must add at least $1,000 to the value of the 88.11 property to be eligible for exclusion under this subdivision. 88.12 Only improvements to the structure which is the residence of the 88.13 qualifying homesteader or construction of or improvements to no 88.14 more than one two-car garage per residence qualify for the 88.15 provisions of this subdivision. If an improvement was begun 88.16 between January 2, 1992, and January 2, 1993, any value added 88.17 from that improvement for the January 1994 and subsequent 88.18 assessments shall qualify for exclusion under this subdivision 88.19 provided that a building permit was obtained for the improvement 88.20 between January 2, 1992, and January 2, 1993. Whenever a 88.21 building permit is issued for property currently classified as 88.22 homestead, the issuing jurisdiction shall notify the property 88.23 owner of the possibility of valuation exclusion under this 88.24 subdivision. The assessor shall requirean application,88.25includingdocumentation of the age of the house from the owner, 88.26 if unknown by the assessor.The application may be filed88.27subsequent to the date of the building permit provided that the88.28application must be filed within three years of the date the88.29building permit was issued for the improvement.If the property 88.30 lies in a jurisdiction which is not subject to a building permit 88.31 process,thean application must be filed within three years of 88.32 the date the improvement was made. The assessor may require 88.33 proof from the taxpayer of the date the improvement was made. 88.34ApplicationsThe application, if required, must be received 88.35 prior to July 1 of any year in order to be effective for taxes 88.36 payable in the following year. 89.1 No exclusion may be granted for an improvement by a local 89.2 board of review or county board of equalization and no abatement 89.3 of the taxes for qualifying improvements may be granted by the 89.4 county board unless (1) a building permit was issued prior to 89.5 the commencement of the improvement if the jurisdiction requires 89.6 a building permit, and (2) an application was completed if the 89.7 jurisdiction is not subject to a building permit process. 89.8 The assessor shall note the qualifying value of each 89.9 improvement on the property's record, and the sum of those 89.10 amounts shall be subtracted from the value of the property in 89.11 each year for ten years after the improvement has been made, at 89.12 which time an amount equal to 20 percent of the qualifying value 89.13 shall be added back in each of the five subsequent assessment 89.14 years. Ifana required application is filed after the first 89.15 assessment date at which an improvement could have been subject 89.16 to the valuation exclusion under this subdivision, the ten-year 89.17 period during which the value is subject to exclusion is reduced 89.18 by the number of years that have elapsed since the property 89.19 would have qualified initially. The valuation exclusion shall 89.20 terminate whenever (1) the property is sold, or (2) the property 89.21 is reclassified to a class which does not qualify for treatment 89.22 under this subdivision. Improvements made by an occupant who is 89.23 the purchaser of the property under a conditional purchase 89.24 contract do not qualify under this subdivision unless the seller 89.25 of the property is a governmental entity. The qualifying value 89.26 of the property shall be computed based upon the increase from 89.27 that structure's market value as of January 2 preceding the 89.28 acquisition of the property by the governmental entity. 89.29 The total qualifying value for a homestead may not exceed 89.30 $50,000. The total qualifying value for a homestead with a 89.31 house that is less than 70 years old may not exceed $25,000. 89.32 The term "qualifying value" means the increase in estimated 89.33 market value resulting from the improvement if the improvement 89.34 occurs when the house is at least 70 years old, or one-half of 89.35 the increase in estimated market value resulting from the 89.36 improvement otherwise. The $25,000 and $50,000 maximum 90.1 qualifying value under this subdivision may result from up to 90.2 three separate improvements to the homestead.The application90.3shall state, in clear language, thatIf more than three 90.4 improvements are made to the qualifying property, a taxpayer may 90.5 choose which three improvements are eligible, provided that 90.6 after the taxpayer has made the choice and any valuation 90.7 attributable to those improvements has been excluded from 90.8 taxation, no further changes can be made by the taxpayer. 90.9 If 50 percent or more of the square footage of a structure 90.10 is voluntarily razed or removed, the valuation increase 90.11 attributable to any subsequent improvements to the remaining 90.12 structure does not qualify for the exclusion under this 90.13 subdivision. If a structure is unintentionally or accidentally 90.14 destroyed by a natural disaster, the property is eligible for an 90.15 exclusion under this subdivision provided that the structure was 90.16 not completely destroyed. The qualifying value on property 90.17 destroyed by a natural disaster shall be computed based upon the 90.18 increase from that structure's market value as determined on 90.19 January 2 of the year in which the disaster occurred. A 90.20 property receiving benefits under the homestead disaster 90.21 provisions under section 273.123 is not disqualified from 90.22 receiving an exclusion under this subdivision. If any 90.23 combination of improvements made to a structure after January 1, 90.24 1993, increases the size of the structure by 100 percent or 90.25 more, the valuation increase attributable to the portion of the 90.26 improvement that causes the structure's size to exceed 100 90.27 percent does not qualify for exclusion under this subdivision. 90.28 Sec. 9. Minnesota Statutes 1998, section 273.111, is 90.29 amended by adding a subdivision to read: 90.30 Subd. 15. [DISSECTED PARCELS; CONTINUED DEFERMENT.] Real 90.31 estate consisting of more than ten, but less than 15, acres 90.32 which has: 90.33 (1) been owned by the applicant or the applicant's parents 90.34 for at least 70 years; 90.35 (2) been dissected by two or more major parkways or 90.36 interstate highways; and 91.1 (3) qualified for the agricultural valuation and tax 91.2 deferment under this section through assessment year 1996, taxes 91.3 payable 1997, shall continue to qualify for deferral of special 91.4 assessments under this section until the applicant's death or 91.5 transfer or sale by the applicant of the applicant's interest in 91.6 the real estate. If the property otherwise no longer qualifies 91.7 for assessment under this section, subdivision 9 does not apply. 91.8 Sec. 10. Minnesota Statutes 1998, section 273.124, 91.9 subdivision 1, is amended to read: 91.10 Subdivision 1. [GENERAL RULE.] (a) Residential real estate 91.11 that is occupied and used for the purposes of a homestead by its 91.12 owner, who must be a Minnesota resident, is a residential 91.13 homestead. 91.14 Agricultural land, as defined in section 273.13, 91.15 subdivision 23, that is occupied and used as a homestead by its 91.16 owner, who must be a Minnesota resident, is an agricultural 91.17 homestead. 91.18 Dates for establishment of a homestead and homestead 91.19 treatment provided to particular types of property are as 91.20 provided in this section. 91.21 Property of a trustee, beneficiary, or grantor of a trust 91.22 is not disqualified from receiving homestead benefits if the 91.23 homestead requirements under this chapter are satisfied. 91.24 The assessor shall require proof, as provided in 91.25 subdivision 13, of the facts upon which classification as a 91.26 homestead may be determined. Notwithstanding any other law, the 91.27 assessor may at any time require a homestead application to be 91.28 filed in order to verify that any property classified as a 91.29 homestead continues to be eligible for homestead status. 91.30 Notwithstanding any other law to the contrary, the department of 91.31 revenue may, upon request from an assessor, verify whether an 91.32 individual who is requesting or receiving homestead 91.33 classification has filed a Minnesota income tax return as a 91.34 resident for the most recent taxable year for which the 91.35 information is available. 91.36 When there is a name change or a transfer of homestead 92.1 property, the assessor may reclassify the property in the next 92.2 assessment unless a homestead application is filed to verify 92.3 that the property continues to qualify for homestead 92.4 classification. 92.5 (b) For purposes of this section, homestead property shall 92.6 include property which is used for purposes of the homestead but 92.7 is separated from the homestead by a road, street, lot, 92.8 waterway, or other similar intervening property. The term "used 92.9 for purposes of the homestead" shall include but not be limited 92.10 to uses for gardens, garages, or other outbuildings commonly 92.11 associated with a homestead, but shall not include vacant land 92.12 held primarily for future development. In order to receive 92.13 homestead treatment for the noncontiguous property, the owner 92.14 must use the property for the purposes of the homestead, and 92.15 must apply to the assessor, both by the deadlines given in 92.16 subdivision 9. After initial qualification for the homestead 92.17 treatment, additional applications for subsequent years are not 92.18 required. 92.19 (c) Residential real estate that is occupied and used for 92.20 purposes of a homestead by a relative of the owner is a 92.21 homestead but only to the extent of the homestead treatment that 92.22 would be provided if the related owner occupied the property. 92.23 For purposes of this paragraph and paragraph (g), "relative" 92.24 means a parent, stepparent, child, stepchild, grandparent, 92.25 grandchild, brother, sister, uncle,oraunt, nephew, or niece. 92.26 This relationship may be by blood or marriage. Property that 92.27 has been classified as seasonal recreational residential 92.28 property at any time during which it has been owned by the 92.29 current owner or spouse of the current owner will not be 92.30 reclassified as a homestead unless it is occupied as a homestead 92.31 by the owner; this prohibition also applies to property that, in 92.32 the absence of this paragraph, would have been classified as 92.33 seasonal recreational residential property at the time when the 92.34 residence was constructed. Neither the related occupant nor the 92.35 owner of the property may claim a property tax refund under 92.36 chapter 290A for a homestead occupied by a relative. In the 93.1 case of a residence located on agricultural land, only the 93.2 house, garage, and immediately surrounding one acre of land 93.3 shall be classified as a homestead under this paragraph, except 93.4 as provided in paragraph (d). 93.5 (d) Agricultural property that is occupied and used for 93.6 purposes of a homestead by a relative of the owner, is a 93.7 homestead, only to the extent of the homestead treatment that 93.8 would be provided if the related owner occupied the property, 93.9 and only if all of the following criteria are met: 93.10 (1) the relative who is occupying the agricultural property 93.11 is a son, daughter, father, or mother of the owner of the 93.12 agricultural property or a son or daughter of the spouse of the 93.13 owner of the agricultural property, 93.14 (2) the owner of the agricultural property must be a 93.15 Minnesota resident, 93.16 (3) the owner of the agricultural property must not receive 93.17 homestead treatment on any other agricultural property in 93.18 Minnesota, and 93.19 (4) the owner of the agricultural property is limited to 93.20 only one agricultural homestead per family under this paragraph. 93.21 Neither the related occupant nor the owner of the property 93.22 may claim a property tax refund under chapter 290A for a 93.23 homestead occupied by a relative qualifying under this 93.24 paragraph. For purposes of this paragraph, "agricultural 93.25 property" means the house, garage, other farm buildings and 93.26 structures, and agricultural land. 93.27 Application must be made to the assessor by the owner of 93.28 the agricultural property to receive homestead benefits under 93.29 this paragraph. The assessor may require the necessary proof 93.30 that the requirements under this paragraph have been met. 93.31 (e) In the case of property owned by a property owner who 93.32 is married, the assessor must not deny homestead treatment in 93.33 whole or in part if only one of the spouses occupies the 93.34 property and the other spouse is absent due to: (1) marriage 93.35 dissolution proceedings, (2) legal separation, (3) employment or 93.36 self-employment in another location, or (4) other personal 94.1 circumstances causing the spouses to live separately, not 94.2 including an intent to obtain two homestead classifications for 94.3 property tax purposes. To qualify under clause (3), the 94.4 spouse's place of employment or self-employment must be at least 94.5 50 miles distant from the other spouse's place of employment, 94.6 and the homesteads must be at least 50 miles distant from each 94.7 other. Homestead treatment, in whole or in part, shall not be 94.8 denied to the owner's spouse who previously occupied the 94.9 residence with the owner if the absence of the owner is due to 94.10 one of the exceptions provided in this paragraph. 94.11 (f) The assessor must not deny homestead treatment in whole 94.12 or in part if: 94.13 (1) in the case of a property owner who is not married, the 94.14 owner is absent due to residence in a nursing home or boarding 94.15 care facility and the property is not otherwise occupied; or 94.16 (2) in the case of a property owner who is married, the 94.17 owner or the owner's spouse or both are absent due to residence 94.18 in a nursing home or boarding care facility and the property is 94.19 not occupied or is occupied only by the owner's spouse. 94.20 (g) If an individual is purchasing property with the intent 94.21 of claiming it as a homestead and is required by the terms of 94.22 the financing agreement to have a relative shown on the deed as 94.23 a coowner, the assessor shall allow a full homestead 94.24 classification. This provision only applies to first-time 94.25 purchasers, whether married or single, or to a person who had 94.26 previously been married and is purchasing as a single individual 94.27 for the first time. The application for homestead benefits must 94.28 be on a form prescribed by the commissioner and must contain the 94.29 data necessary for the assessor to determine if full homestead 94.30 benefits are warranted. 94.31 Sec. 11. Minnesota Statutes 1998, section 273.124, 94.32 subdivision 7, is amended to read: 94.33 Subd. 7. [LEASED BUILDINGS OR LAND.] For purposes of class 94.34 1 determinations, homesteads include: 94.35 (a) buildings and appurtenances owned and used by the 94.36 occupant as a permanent residence which are located upon land 95.1 the title to which is vested in a person or entity other than 95.2 the occupant; 95.3 (b) all buildings and appurtenances located upon land owned 95.4 by the occupant and used for the purposes of a homestead 95.5 together with the land upon which they are located, if all of 95.6 the following criteria are met: 95.7 (1) the occupant is using the property as a permanent 95.8 residence; 95.9 (2) the occupant is paying the property taxes and any 95.10 special assessments levied against the property; 95.11 (3) the occupant has signed a lease which has an option to 95.12 purchase the buildings and appurtenances; 95.13 (4) the term of the lease is at least five years; and 95.14 (5) the occupant has made a down payment of at least $5,000 95.15 in cash if the property was purchased by means of a contract for 95.16 deed or subject to a mortgage. 95.17 (c) all buildings and appurtenances and the land upon which 95.18 they are located that are used for purposes of a homestead, if 95.19 all of the following criteria are met: 95.20 (1) the land is owned by a utility, which maintains 95.21 ownership of the land in order to facilitate compliance with the 95.22 terms of its hydroelectric project license from the federal 95.23 energy regulatory commission; 95.24 (2) the land is leased for a term of 20 years or more; 95.25 (3) the occupant is using the property as a permanent 95.26 residence; and 95.27 (4) the occupant is paying the property taxes and any 95.28 special assessments levied against the property. 95.29 Any taxpayer meeting all the requirements of this paragraph 95.30 must notify the county assessor, or the assessor who has the 95.31 powers of the county assessor pursuant to section 273.063, in 95.32 writing, as soon as possible after signing the lease agreement 95.33 and occupying the buildings as a homestead. 95.34 Sec. 12. Minnesota Statutes 1998, section 273.124, 95.35 subdivision 8, is amended to read: 95.36 Subd. 8. [HOMESTEAD OWNED BY FAMILY FARM CORPORATION OR 96.1 PARTNERSHIP OR LEASED TO FAMILY FARM CORPORATION OR 96.2 PARTNERSHIP.] (a) Each family farm corporation and each 96.3 partnership operating a family farm is entitled to class 1b 96.4 under section 273.13, subdivision 22, paragraph (b), or class 2a 96.5 assessment for one homestead occupied by a shareholder or 96.6 partner thereof who is residing on the land and actively engaged 96.7 in farming of the land owned by the corporation or partnership. 96.8 Homestead treatment applies even if legal title to the property 96.9 is in the name of the corporation or partnership and not in the 96.10 name of the person residing on it. "Family farm corporation" 96.11 and "family farm" have the meanings given in section 500.24, 96.12 except that the number of allowable shareholders or partners 96.13 under this subdivision shall not exceed 12. 96.14 (b) In addition to property specified in paragraph (a), any 96.15 other residences owned by corporations or partnerships described 96.16 in paragraph (a) which are located on agricultural land and 96.17 occupied as homesteads by shareholders or partners who are 96.18 actively engaged in farming on behalf of the corporation or 96.19 partnership must also be assessed as class 2a property or as 96.20 class 1b property under section 273.13, subdivision 22, 96.21 paragraph (b), but the property eligible is limited to the96.22residence itself and as much of the land surrounding the96.23homestead, not exceeding one acre, as is reasonably necessary96.24for the use of the dwelling as a home, and does not include any96.25other structures that may be located on it. 96.26 (c) Agricultural property owned by a shareholder of a 96.27 family farm corporation, as defined in paragraph (a), or by a 96.28 partner in a partnership operating a family farm and leased to 96.29 the family farm corporation by the shareholder or to the 96.30 partnership by the partner, is eligible for classification as 96.31 class 1b under section 273.13, subdivision 22, paragraph (b), or 96.32 class 2a under section 273.13, subdivision 23, paragraph (a), if 96.33 the owner is actually residing on the property and is actually 96.34 engaged in farming the land on behalf of the corporation or 96.35 partnership. This paragraph applies without regard to any legal 96.36 possession rights of the family farm corporation or partnership 97.1 operating a family farm under the lease. 97.2 Sec. 13. Minnesota Statutes 1998, section 273.124, 97.3 subdivision 14, is amended to read: 97.4 Subd. 14. [AGRICULTURAL HOMESTEADS; SPECIAL PROVISIONS.] 97.5 (a) Real estate of less than ten acres that is the homestead of 97.6 its owner must be classified as class 2a under section 273.13, 97.7 subdivision 23, paragraph (a), if: 97.8 (1) the parcel on which the house is located is contiguous 97.9 on at least two sides to (i) agricultural land, (ii) land owned 97.10 or administered by the United States Fish and Wildlife Service, 97.11 or (iii) land administered by the department of natural 97.12 resources on which in lieu taxes are paid under sections 477A.11 97.13 to 477A.14; 97.14 (2) its owner also owns a noncontiguous parcel of 97.15 agricultural land that is at least 20 acres; and 97.16 (3)the noncontiguous land is located not farther than four97.17townships or cities, or a combination of townships or cities97.18from the homestead; and97.19(4)the agricultural use value of the noncontiguous land 97.20 and farm buildings is equal to at least 50 percent of the market 97.21 value of the house, garage, and one acre of land. 97.22 Homesteads initially classified as class 2a under the 97.23 provisions of this paragraph shall remain classified as class 97.24 2a, irrespective of subsequent changes in the use of adjoining 97.25 properties, as long as the homestead remains under the same 97.26 ownership, the owner owns a noncontiguous parcel of agricultural 97.27 land that is at least 20 acres, and the agricultural use value 97.28 qualifies under clause(4)(3). 97.29 (b)Except as provided in paragraph (d),Noncontiguous land 97.30 shall be included as part of a homestead under section 273.13, 97.31 subdivision 23, paragraph (a), only if the homestead is 97.32 classified as class 2aand the detached land is located in the97.33same township or city, or not farther than four townships or97.34cities or combination thereof from the homestead. Any taxpayer 97.35 ofthesenoncontiguous lands must notify the county assessor 97.36 that the noncontiguous land is part of the taxpayer's homestead, 98.1 and, if the homestead is located in another county, the taxpayer 98.2 must also notify the assessor of the other county. 98.3 (c) Agricultural land used for purposes of a homestead and 98.4 actively farmed by a person holding a vested remainder interest 98.5 in it must be classified as a homestead under section 273.13, 98.6 subdivision 23, paragraph (a). If agricultural land is 98.7 classified class 2a, any other dwellings on the land used for 98.8 purposes of a homestead by persons holding vested remainder 98.9 interests who are actively engaged in farming the property, and 98.10 up to one acre of the land surrounding each homestead and 98.11 reasonably necessary for the use of the dwelling as a home, must 98.12 also be assessed class 2a. 98.13 (d) Agricultural land and buildings that were class 2a 98.14 homestead property under section 273.13, subdivision 23, 98.15 paragraph (a), for the 1997 assessment shall remain classified 98.16 as agricultural homesteads for subsequent assessments if: 98.17 (1) the property owner abandoned the homestead dwelling 98.18 located on the agricultural homestead as a result of the April 98.19 1997 floods; 98.20 (2) the property is located in the county of Polk, Clay, 98.21 Kittson, Marshall, Norman, or Wilkin; 98.22 (3) the agricultural land and buildings remain under the 98.23 same ownership for the current assessment year as existed for 98.24 the 1997 assessment year and continue to be used for 98.25 agricultural purposes; 98.26 (4) the dwelling occupied by the owner is located in 98.27 Minnesota and is within 30 miles of one of the parcels of 98.28 agricultural land that is owned by the taxpayer; and 98.29 (5) the owner notifies the county assessor that the 98.30 relocation was due to the 1997 floods, and the owner furnishes 98.31 the assessor any information deemed necessary by the assessor in 98.32 verifying the change in dwelling. Further notifications to the 98.33 assessor are not required if the property continues to meet all 98.34 the requirements in this paragraph and any dwellings on the 98.35 agricultural land remain uninhabited. 98.36 (e) Agricultural land and buildings that were class 2a 99.1 homestead property under section 273.13, subdivision 23, 99.2 paragraph (a), for the 1998 assessment shall remain classified 99.3 agricultural homesteads for subsequent assessments if: 99.4 (1) the property owner abandoned the homestead dwelling 99.5 located on the agricultural homestead as a result of damage 99.6 caused by a March 29, 1998, tornado; 99.7 (2) the property is located in the county of Blue Earth, 99.8 Brown, Cottonwood, LeSueur, Nicollet, Nobles, or Rice; 99.9 (3) the agricultural land and buildings remain under the 99.10 same ownership for the current assessment year as existed for 99.11 the 1998 assessment year; 99.12 (4) the dwelling occupied by the owner is located in this 99.13 state and is within 50 miles of one of the parcels of 99.14 agricultural land that is owned by the taxpayer; and 99.15 (5) the owner notifies the county assessor that the 99.16 relocation was due to a March 29, 1998, tornado, and the owner 99.17 furnishes the assessor any information deemed necessary by the 99.18 assessor in verifying the change in homestead dwelling. For 99.19 taxes payable in 1999, the owner must notify the assessor by 99.20 December 1, 1998. Further notifications to the assessor are not 99.21 required if the property continues to meet all the requirements 99.22 in this paragraph and any dwellings on the agricultural land 99.23 remain uninhabited. 99.24 Sec. 14. Minnesota Statutes 1998, section 273.124, is 99.25 amended by adding a subdivision to read: 99.26 Subd. 20. [ADDITIONAL REQUIREMENTS PROHIBITED.] No 99.27 political subdivision may impose any requirements not contained 99.28 in this chapter or chapter 272 to disqualify property from being 99.29 classified as a homestead if the property otherwise meets the 99.30 requirements for homestead treatment under this chapter and 99.31 chapter 272. 99.32 Sec. 15. Minnesota Statutes 1998, section 273.13, 99.33 subdivision 23, is amended to read: 99.34 Subd. 23. [CLASS 2.] (a) Class 2a property is agricultural 99.35 land including any improvements that is homesteaded. The market 99.36 value of the house and garage and immediately surrounding one 100.1 acre of land has the same class rates as class 1a property under 100.2 subdivision 22. The value of the remaining land including 100.3 improvements up to$115,000$250,000 has a net class rate of 100.4 0.35 percent of market value. The remaining value of class 2a 100.5 property over$115,000$250,000 and up to $500,000 of market 100.6 valuethat does not exceed 320 acreshas a net class rate of0.8100.7 0.7 percent of market value. The remaining property 100.8 over$115,000$500,000 of market value in excess of 320 acres 100.9 has a class rate of1.251.05 percent of market value. 100.10 (b) Class 2b property is (1) real estate, rural in 100.11 character and used exclusively for growing trees for timber, 100.12 lumber, and wood and wood products; (2) real estate that is not 100.13 improved with a structure and is used exclusively for growing 100.14 trees for timber, lumber, and wood and wood products, if the 100.15 owner has participated or is participating in a cost-sharing 100.16 program for afforestation, reforestation, or timber stand 100.17 improvement on that particular property, administered or 100.18 coordinated by the commissioner of natural resources; (3) real 100.19 estate that is nonhomestead agricultural land; or (4) a landing 100.20 area or public access area of a privately owned public use 100.21 airport. Class 2b property has a net class rate of1.251.05 100.22 percent of market value. 100.23 (c) Agricultural land as used in this section means 100.24 contiguous acreage of ten acres or more, used during the 100.25 preceding year for agricultural purposes. "Agricultural 100.26 purposes" as used in this section means the raising or 100.27 cultivation of agricultural products or enrollment in the 100.28 Reinvest in Minnesota program under sections 103F.501 to 100.29 103F.535 or the federal Conservation Reserve Program as 100.30 contained in Public Law Number 99-198. Contiguous acreage on 100.31 the same parcel, or contiguous acreage on an immediately 100.32 adjacent parcel under the same ownership, may also qualify as 100.33 agricultural land, but only if it is pasture, timber, waste, 100.34 unusable wild land, or land included in state or federal farm 100.35 programs. Agricultural classification for property shall be 100.36 determined excluding the house, garage, and immediately 101.1 surrounding one acre of land, and shall not be based upon the 101.2 market value of any residential structures on the parcel or 101.3 contiguous parcels under the same ownership. 101.4 (d) Real estate, excluding the house, garage, and 101.5 immediately surrounding one acre of land, of less than ten acres 101.6 which is exclusively and intensively used for raising or 101.7 cultivating agricultural products, shall be considered as 101.8 agricultural land. 101.9 Land shall be classified as agricultural even if all or a 101.10 portion of the agricultural use of that property is the leasing 101.11 to, or use by another person for agricultural purposes. 101.12 Classification under this subdivision is not determinative 101.13 for qualifying under section 273.111. 101.14 The property classification under this section supersedes, 101.15 for property tax purposes only, any locally administered 101.16 agricultural policies or land use restrictions that define 101.17 minimum or maximum farm acreage. 101.18 (e) The term "agricultural products" as used in this 101.19 subdivision includes production for sale of: 101.20 (1) livestock, dairy animals, dairy products, poultry and 101.21 poultry products, fur-bearing animals, horticultural and nursery 101.22 stock described in sections 18.44 to 18.61, fruit of all kinds, 101.23 vegetables, forage, grains, bees, and apiary products by the 101.24 owner; 101.25 (2) fish bred for sale and consumption if the fish breeding 101.26 occurs on land zoned for agricultural use; 101.27 (3) the commercial boarding of horses if the boarding is 101.28 done in conjunction with raising or cultivating agricultural 101.29 products as defined in clause (1); 101.30 (4) property which is owned and operated by nonprofit 101.31 organizations used for equestrian activities, excluding racing; 101.32and101.33 (5) game birds and waterfowl bred and raised for use on a 101.34 shooting preserve licensed under section 97A.115; and 101.35 (6) insects primarily bred to be used as food for animals. 101.36 (f) If a parcel used for agricultural purposes is also used 102.1 for commercial or industrial purposes, including but not limited 102.2 to: 102.3 (1) wholesale and retail sales; 102.4 (2) processing of raw agricultural products or other goods; 102.5 (3) warehousing or storage of processed goods; and 102.6 (4) office facilities for the support of the activities 102.7 enumerated in clauses (1), (2), and (3), 102.8 the assessor shall classify the part of the parcel used for 102.9 agricultural purposes as class 1b, 2a, or 2b, whichever is 102.10 appropriate, and the remainder in the class appropriate to its 102.11 use. The grading, sorting, and packaging of raw agricultural 102.12 products for first sale is considered an agricultural purpose. 102.13 A greenhouse or other building where horticultural or nursery 102.14 products are grown that is also used for the conduct of retail 102.15 sales must be classified as agricultural if it is primarily used 102.16 for the growing of horticultural or nursery products from seed, 102.17 cuttings, or roots and occasionally as a showroom for the retail 102.18 sale of those products. Use of a greenhouse or building only 102.19 for the display of already grown horticultural or nursery 102.20 products does not qualify as an agricultural purpose. 102.21 The assessor shall determine and list separately on the 102.22 records the market value of the homestead dwelling and the one 102.23 acre of land on which that dwelling is located. If any farm 102.24 buildings or structures are located on this homesteaded acre of 102.25 land, their market value shall not be included in this separate 102.26 determination. 102.27 (g) To qualify for classification under paragraph (b), 102.28 clause (4), a privately owned public use airport must be 102.29 licensed as a public airport under section 360.018. For 102.30 purposes of paragraph (b), clause (4), "landing area" means that 102.31 part of a privately owned public use airport properly cleared, 102.32 regularly maintained, and made available to the public for use 102.33 by aircraft and includes runways, taxiways, aprons, and sites 102.34 upon which are situated landing or navigational aids. A landing 102.35 area also includes land underlying both the primary surface and 102.36 the approach surfaces that comply with all of the following: 103.1 (i) the land is properly cleared and regularly maintained 103.2 for the primary purposes of the landing, taking off, and taxiing 103.3 of aircraft; but that portion of the land that contains 103.4 facilities for servicing, repair, or maintenance of aircraft is 103.5 not included as a landing area; 103.6 (ii) the land is part of the airport property; and 103.7 (iii) the land is not used for commercial or residential 103.8 purposes. 103.9 The land contained in a landing area under paragraph (b), clause 103.10 (4), must be described and certified by the commissioner of 103.11 transportation. The certification is effective until it is 103.12 modified, or until the airport or landing area no longer meets 103.13 the requirements of paragraph (b), clause (4). For purposes of 103.14 paragraph (b), clause (4), "public access area" means property 103.15 used as an aircraft parking ramp, apron, or storage hangar, or 103.16 an arrival and departure building in connection with the airport. 103.17 Sec. 16. Minnesota Statutes 1998, section 273.13, 103.18 subdivision 24, is amended to read: 103.19 Subd. 24. [CLASS 3.] (a) Commercial and industrial 103.20 property and utility real and personal property, except class 5 103.21 property as identified in subdivision 31, clause (1), is class 103.22 3a. Each parcel has a class rate of 2.45 percent of the first 103.23 tier of market value, and 3.5 percent of the remaining market 103.24 value, except that in the case of contiguous parcels of 103.25 commercial and industrial property owned by the same person or 103.26 entity, only the value equal to the first-tier value of the 103.27 contiguous parcels qualifies for the reduced class rate. For 103.28 the purposes of this subdivision, the first tier means the first 103.29 $150,000 of market value. In the case of utility property owned 103.30 by one person or entity, only one parcel in each county has a 103.31 reduced class rate on the first tier of market value, except 103.32 that this limitation does not apply to utility property 103.33 described in section 272.03, subdivision 6, paragraph (b). 103.34 For purposes of this paragraph, parcels are considered to 103.35 be contiguous even if they are separated from each other by a 103.36 road, street, vacant lot, waterway, or other similar intervening 104.1 type of property. 104.2 (b) Employment property defined in section 469.166, during 104.3 the period provided in section 469.170, shall constitute class 104.4 3b and has a class rate of 2.3 percent of the first $50,000 of 104.5 market value and 3.5 percent of the remainder, except that for 104.6 employment property located in a border city enterprise zone 104.7 designated pursuant to section 469.168, subdivision 4, paragraph 104.8 (c), the class rate of the first tier of market value and the 104.9 class rate of the remainder is determined under paragraph (a), 104.10 unless the governing body of the city designated as an 104.11 enterprise zone determines that a specific parcel shall be 104.12 assessed pursuant to the first clause of this sentence. The 104.13 governing body may provide for assessment under the first clause 104.14 of the preceding sentence only for property which is located in 104.15 an area which has been designated by the governing body for the 104.16 receipt of tax reductions authorized by section 469.171, 104.17 subdivision 1. 104.18 (c) Structures which are (i) located on property classified 104.19 as class 3a, (ii) constructed under an initial building permit 104.20 issued after January 2, 1996, (iii) located in a transit zone as 104.21 defined under section 473.3915, subdivision 3, (iv) located 104.22 within the boundaries of a school district, and (v) not 104.23 primarily used for retail or transient lodging purposes, shall 104.24 have a class rate equal to 85 percent of the class rate of the 104.25 second tier of the commercial property rate under paragraph (a) 104.26 on any portion of the market value that does not qualify for the 104.27 first tier class rate under paragraph (a). As used in item (v), 104.28 a structure is primarily used for retail or transient lodging 104.29 purposes if over 50 percent of its square footage is used for 104.30 those purposes. A class rate equal to 85 percent of the class 104.31 rate of the second tier of the commercial property class rate 104.32 under paragraph (a) shall also apply to improvements to existing 104.33 structures that meet the requirements of items (i) to (v) if the 104.34 improvements are constructed under an initial building permit 104.35 issued after January 2, 1996, even if the remainder of the 104.36 structure was constructed prior to January 2, 1996. For the 105.1 purposes of this paragraph, a structure shall be considered to 105.2 be located in a transit zone if any portion of the structure 105.3 lies within the zone. If any property once eligible for 105.4 treatment under this paragraph ceases to remain eligible due to 105.5 revisions in transit zone boundaries, the property shall 105.6 continue to receive treatment under this paragraph for a period 105.7 of three years. 105.8 Sec. 17. Minnesota Statutes 1998, section 273.13, 105.9 subdivision 31, is amended to read: 105.10 Subd. 31. [CLASS 5.] Class 5 property includes: 105.11 (1) tools, implements, and machinery of an electric 105.12 generating, transmission, or distribution system, unless exempt 105.13 under section 272.027, or a pipeline system transporting or 105.14 distributing water, gas, crude oil, or petroleum products or 105.15 mains and pipes used in the distribution of steam or hot or 105.16 chilled water for heating or cooling buildings, which are 105.17 fixtures; 105.18 (2) unmined iron ore and low-grade iron-bearing formations 105.19 as defined in section 273.14; and 105.20 (3) all other property not otherwise classified. 105.21 Class 5 property has a class rate of 3.5 percent of market 105.22 value. 105.23 Sec. 18. Minnesota Statutes 1998, section 273.1382, 105.24 subdivision 1, is amended to read: 105.25 Subdivision 1. [EDUCATION HOMESTEAD CREDIT.] Each year, 105.26 the respective county auditors shall determine the initial tax 105.27 rate for each school district for the general education levy 105.28 certified under section 126C.13, subdivision 2 or 3. That rate 105.29 plus the school district's education homestead credit tax rate 105.30 adjustment under section 275.08, subdivision 1e, shall be the 105.31 general education homestead credit local tax rate for the 105.32 district. The auditor shall then determine a general education 105.33 homestead credit for each homestead within the county equal to 105.3468 percent for taxes payable in 1999 and 6977.5 percent for 105.35 taxes payable in 2000 and thereafter of the general education 105.36 homestead credit local tax rate times the net tax capacity of 106.1 the homestead for the taxes payable year. The amount of general 106.2 education homestead credit for a homestead may not exceed$320106.3for taxes payable in 1999 and $335$400 for taxes payable in 106.4 2000 and thereafter. In the case of an agricultural homestead, 106.5 only the net tax capacity of the house, garage, and surrounding 106.6 one acre of land shall be used in determining the property's 106.7 education homestead credit. 106.8 Sec. 19. Minnesota Statutes 1998, section 273.1398, 106.9 subdivision 1a, is amended to read: 106.10 Subd. 1a. [TAX BASE DIFFERENTIAL.] (a) For aids payable in 106.11 2000, the tax base differential is: 106.12 (1) the following percentages of the assessment year 1998 106.13 taxable market value of class 2a agricultural homestead 106.14 property, excluding the house, garage, and surrounding one acre 106.15 of land: between $115,000 and $250,000 and less than 320 acres, 106.16 .45 percent; between $115,000 and $250,000 and over 320 acres, 106.17 .9 percent; over $250,000 up to $500,000 and less than 320 106.18 acres, 0.1 percent; over $250,000 up to $500,000 and over 320 106.19 acres, 0.55 percent; and the market value that exceeds $500,000, 106.20 .25 percent; plus .25 percent of the assessment year 1998 106.21 taxable market value of class 2b nonhomestead agricultural land 106.22 and timberland; plus 106.23 (2) for purposes of computing the fiscal disparity 106.24 adjustment only,the tax base differential is0.2 percent of the 106.25 assessment year 1998 taxable market value of class 3 106.26 commercial-industrial property over $150,000. 106.27 (b) For the purposes of the distribution of homestead and 106.28 agricultural credit aid for aids payable in 2000, the 106.29 commissioner of revenue shall use the best information available 106.30 as of June 30, 1999, to make an estimate of the value described 106.31 in paragraph (a), clause (1). The commissioner shall adjust the 106.32 distribution of homestead and agricultural credit aid for aids 106.33 payable in 2001 and subsequent years if new information 106.34 regarding the value described in paragraph (a), clause (1), 106.35 becomes available after June 30, 1999. 106.36 Sec. 20. Minnesota Statutes 1998, section 275.066, is 107.1 amended to read: 107.2 275.066 [SPECIAL TAXING DISTRICTS; DEFINITION.] 107.3 For the purposes of property taxation and property tax 107.4 state aids, the term "special taxing districts" includes the 107.5 following entities: 107.6 (1) watershed districts under chapter 103D; 107.7 (2) sanitary districts under sections 115.18 to 115.37; 107.8 (3) regional sanitary sewer districts under sections 115.61 107.9 to 115.67; 107.10 (4) regional public library districts under section 107.11 134.201; 107.12 (5) park districts under chapter 398; 107.13 (6) regional railroad authorities under chapter 398A; 107.14 (7) hospital districts under sections 447.31 to 447.38; 107.15 (8) St. Cloud metropolitan transit commission under 107.16 sections 458A.01 to 458A.15; 107.17 (9) Duluth transit authority under sections 458A.21 to 107.18 458A.37; 107.19 (10) regional development commissions under sections 107.20 462.381 to 462.398; 107.21 (11) housing and redevelopment authorities under sections 107.22 469.001 to 469.047; 107.23 (12) port authorities under sections 469.048 to 469.068; 107.24 (13) economic development authorities under sections 107.25 469.090 to 469.1081; 107.26 (14) metropolitan council under sections 473.123 to 107.27 473.549; 107.28 (15) metropolitan airports commission under sections 107.29 473.601 to 473.680; 107.30 (16) metropolitan mosquito control commission under 107.31 sections 473.701 to 473.716; 107.32 (17) Morrison county rural development financing authority 107.33 under Laws 1982, chapter 437, section 1; 107.34 (18) Croft Historical Park District under Laws 1984, 107.35 chapter 502, article 13, section 6; 107.36 (19) East Lake county medical clinic district under Laws 108.1 1989, chapter 211, sections 1 to 6; 108.2 (20) Floodwood area ambulance district under Laws 1993, 108.3 chapter 375, article 5, section 39;and108.4 (21) Middle Mississippi River Watershed Management 108.5 Organization under sections 103B.211 and 103B.241; and 108.6 (22) any other political subdivision of the state of 108.7 Minnesota, excluding counties, school districts, cities, and 108.8 towns, that has the power to adopt and certify a property tax 108.9 levy to the county auditor, as determined by the commissioner of 108.10 revenue. 108.11 Sec. 21. Minnesota Statutes 1998, section 282.05, is 108.12 amended to read: 108.13 282.05 [PROCEEDS APPORTIONED.] 108.14 The net proceeds received from the sale or rental of 108.15 forfeited lands shall be apportioned to the general funds of the 108.16 state or municipal subdivision thereof, in the manner 108.17hereinafterprovided, and shall be first used by the municipal108.18subdivision to retire any indebtedness then existingin section 108.19 282.08. 108.20 Sec. 22. Minnesota Statutes 1998, section 298.22, 108.21 subdivision 7, is amended to read: 108.22 Subd. 7. [GIANTS RIDGE RECREATION AREA.] (a) In addition 108.23 to the other powers granted in this section and other law, the 108.24 commissioner, for purposes of fostering economic development and 108.25 tourism within the Giants Ridge recreation area, may spend any 108.26 money made available to the agency under section 298.28 to 108.27 acquire real or personal property or interests therein by gift, 108.28 purchase, or lease and may convey by lease, sale, or other means 108.29 of conveyance or commitment any or all of those property 108.30 interests acquired. 108.31 (b)Notwithstanding any other law to the contrary, property108.32conveyed under this subdivision and used for residential108.33purposes is not eligible for property tax homestead108.34classification under section 273.124 or for a property tax108.35refund under chapter 290A.108.36(c)In furtherance of development of the Giants Ridge 109.1 recreation area, the commissioner may establish and participate 109.2 in charitable foundations and nonprofit corporations, including 109.3 a corporation within the meaning of section 317A.011, 109.4 subdivision 6. 109.5(d)(c) The term "Giants Ridge recreation area" refers to 109.6 an economic development project area established by the 109.7 commissioner in furtherance of the powers delegated in this 109.8 section within St. Louis county in the western portions of the 109.9 town of White and in the eastern portion of the westerly, 109.10 adjacent, unorganized township. 109.11 Sec. 23. Minnesota Statutes 1998, section 373.40, 109.12 subdivision 1, is amended to read: 109.13 Subdivision 1. [DEFINITIONS.] For purposes of this 109.14 section, the following terms have the meanings given. 109.15 (a) "Bonds" means an obligation as defined under section 109.16 475.51. 109.17 (b) "Capital improvement" means acquisition or betterment 109.18 of public lands, development rights in the form of conservation 109.19 easements under chapter 84C, buildings, or other improvements 109.20 within the county for the purpose of a county courthouse, 109.21 administrative building, health or social service facility, 109.22 correctional facility, jail, law enforcement center, hospital, 109.23 morgue, library, park, qualified indoor ice arena, and roads and 109.24 bridges. An improvement must have an expected useful life of 109.25 five years or more to qualify. "Capital improvement" does not 109.26 include light rail transit or any activity related to it or a 109.27 recreation or sports facility building (such as, but not limited 109.28 to, a gymnasium, ice arena, racquet sports facility, swimming 109.29 pool, exercise room or health spa), unless the building is part 109.30 of an outdoor park facility and is incidental to the primary 109.31 purpose of outdoor recreation. 109.32 (c) "Commissioner" means the commissioner of trade and 109.33 economic development. 109.34 (d) "Metropolitan county" means a county located in the 109.35 seven-county metropolitan area as defined in section 473.121 or 109.36 a county with a population of 90,000 or more. 110.1 (e) "Population" means the population established by the 110.2 most recent of the following (determined as of the date the 110.3 resolution authorizing the bonds was adopted): 110.4 (1) the federal decennial census, 110.5 (2) a special census conducted under contract by the United 110.6 States Bureau of the Census, or 110.7 (3) a population estimate made either by the metropolitan 110.8 council or by the state demographer under section 4A.02. 110.9 (f) "Qualified indoor ice arena" means a facility that 110.10 meets the requirements of section 373.43. 110.11 (g) "Tax capacity" means total taxable market value, but 110.12 does not include captured market value. 110.13 Sec. 24. Minnesota Statutes 1998, section 375.18, 110.14 subdivision 12, is amended to read: 110.15 Subd. 12. [LAND FOR PUBLIC USE.] Each county board may 110.16 acquire by gift or purchase and improve land within the county, 110.17 for use as a park, site for a building, or other public purpose, 110.18 and, when required by the public interest, sell and convey it. 110.19 The land may be paid for out of moneys in the county treasury 110.20 not otherwise appropriated, or by issuing bonds of the 110.21 county. The county board may acquire development rights in the 110.22 form of a conservation easement under chapter 84C. The holder 110.23 of the conservation easement may be a governmental body or a 110.24 charitable corporation, as provided by section 84C.01. 110.25 Sec. 25. [375.511] [ADMINISTRATIVE PENALTIES.] 110.26 A county board may impose an administrative penalty for 110.27 violation of an ordinance enacted under chapter 103F. No 110.28 penalty may be imposed unless the owner has received notice, 110.29 served personally or by mail, of the alleged violation and an 110.30 opportunity for a hearing before a person authorized by the 110.31 county board to conduct the hearing. A decision that a 110.32 violation occurred must be in writing. The amount of the 110.33 penalty with interest may not exceed the amount allowed for a 110.34 single misdemeanor violation. A person aggrieved by a decision 110.35 under this section may have the decision reviewed in the 110.36 district court. If a penalty imposed under this section is 111.1 unpaid for more than 60 days after the date when payment is due, 111.2 the county board may certify the penalty to the county auditor 111.3 for collection to the same extent and in the same manner 111.4 provided by law for the assessment and collection of real estate 111.5 taxes. 111.6 Sec. 26. Minnesota Statutes 1998, section 398A.04, 111.7 subdivision 1, is amended to read: 111.8 Subdivision 1. [GENERAL.] An authority may exercise all 111.9 the powers necessary or desirable to implement the powers 111.10 specifically granted in this section, and in exercising the 111.11 powers is deemed to be performing an essential governmental 111.12 function and exercising a part of the sovereign power of the 111.13 state, and is a local government unit and political subdivision 111.14 of the state. Without limiting the generality of the foregoing, 111.15 the authority may: 111.16 (a) sue and be sued, have a seal, which may but need not be 111.17 affixed to documents as directed by the board, make and perform 111.18 contracts, and have perpetual succession; 111.19 (b) acquire real and personal property within or outside 111.20 its taxing jurisdiction, by purchase, gift, devise, 111.21 condemnation, conditional sale, lease, lease purchase, or 111.22 otherwise; or for purposes, including the facilitation of an 111.23 economic development project pursuant to section 383B.81 or 111.24 469.091 or 469.175, subdivision 7, that also improve rail 111.25 service;and111.26 (c) hold, manage, control, sell, convey, lease, mortgage, 111.27 or otherwise dispose of real or personal property; and 111.28 (d) make grants or otherwise appropriate funds to the 111.29 department of transportation, the metropolitan council, or any 111.30 other state or local governmental unit for the purposes 111.31 described in subdivision 2 with respect to railroad facilities 111.32 located or to be located within the authority's jurisdiction, 111.33 whether or not the facilities will be acquired, constructed, 111.34 owned, or operated by the authority. 111.35 Sec. 27. Minnesota Statutes 1998, section 398A.04, 111.36 subdivision 8, is amended to read: 112.1 Subd. 8. [TAXATION.] Before deciding to exercise the power 112.2 to tax, the authority shall give six weeks' published notice in 112.3 all municipalities in the region. If a number of voters in the 112.4 region equal to five percent of those who voted for candidates 112.5 for governor at the last gubernatorial election present a 112.6 petition within nine weeks of the first published notice to the 112.7 secretary of state requesting that the matter be submitted to 112.8 popular vote, it shall be submitted at the next general 112.9 election. The question prepared shall be: 112.10 "Shall the regional rail authority have the power to impose 112.11 a property tax? 112.12 Yes ....... 112.13 No ........" 112.14 If a majority of those voting on the question approve or if 112.15 no petition is presented within the prescribed time the 112.16 authority may levy a tax at any annual rate not exceeding 112.17 0.04835 percent of market value of all taxable property situated 112.18 within the municipality or municipalities named in its 112.19 organization resolution; provided, however, that the maximum 112.20 amount of the tax which may be levied in any year shall be 112.21 reduced by the amount of taxes levied to pay principal and 112.22 interest due in the following year on any outstanding general 112.23 obligation bonds issued pursuant to section 398A.07. Its 112.24 recording officer shall file, on or before September 15, in the 112.25 office of the county auditor of each county in which territory 112.26 under the jurisdiction of the authority is located a certified 112.27 copy of the board of commissioners' resolution levying the tax, 112.28 and each county auditor shall assess and extend upon the tax 112.29 rolls of each municipality named in the organization resolution 112.30 the portion of the tax that bears the same ratio to the whole 112.31 amount that the net tax capacity of taxable property in that 112.32 municipality bears to the net tax capacity of taxable property 112.33 in all municipalities named in the organization resolution. 112.34 Collections of the tax shall be remitted by each county 112.35 treasurer to the treasurer of the authority. For taxes levied 112.36 in 1991, the amount levied for light rail transit purposes under 113.1 this subdivision shall not exceed 75 percent of the amount 113.2 levied in 1990 for light rail transit purposes under this 113.3 subdivision. 113.4 Sec. 28. Minnesota Statutes 1998, section 398A.04, 113.5 subdivision 9, is amended to read: 113.6 Subd. 9. [AGREEMENTS.] The authority may enter into joint 113.7 powers agreements under section 471.59 or other agreements with 113.8 the municipality or municipalities named in the organization 113.9 agreement, or; with other municipalities situated in the 113.10 counties named in the resolution, respecting the matters 113.11 referred to in section 398A.06or; with another authority; with 113.12 a state agency; or with the metropolitan council about any 113.13 matter subject to this chapter. 113.14 Sec. 29. Minnesota Statutes 1998, section 398A.07, 113.15 subdivision 2, is amended to read: 113.16 Subd. 2. [SECURITY.] Bonds may be made payable exclusively 113.17 from the revenues from one or more projects, or from one or more 113.18 revenue producing contracts, or from the authority's revenues 113.19 generally, including but not limited to specified taxes which 113.20 the authority may levy or which a particular municipality may 113.21 agree to levy for a specified purpose, and may be additionally 113.22 secured by a pledge of any grant, subsidy, or contribution from 113.23 any public agency, including but not limited to a participating 113.24 municipality, or any income or revenues from any source. They 113.25 may be secured by a mortgage or deed of trust of the whole or 113.26 any part of the property of the authority. They shall be 113.27 payable solely from the revenues, funds, and property pledged or 113.28 mortgaged for their payment. No commissioner, officer, 113.29 employee, agent, or trustee of the authority shall be liable 113.30 personally on its bonds or be subject to any personal liability 113.31 or accountability by reason of their issuance. Neither the 113.32 state nor a county or other municipality except the authority 113.33 may pledge its faith and credit or taxing power or shall be 113.34 obligated in any manner for the payment of the bonds or interest 113.35 on them, except as specifically provided by agreement under 113.36 section 398A.06; but nothing herein shall affect the obligation 114.1 of the state or municipality to perform any contract made by it 114.2 with the authority, and when the authority's rights under a 114.3 contract with the state or a municipality are pledged by the 114.4 authority for the security of its bonds, the holders or a bond 114.5 trustee may enforce the rights as a third party beneficiary. 114.6 All bonds shall be negotiable within the meaning and for the 114.7 purposes of the Uniform Commercial Code, subject only to any 114.8 registration requirement. If the authority is authorized to 114.9 levy taxes under section 398A.04, subdivision 8, the authority 114.10 may issue general obligation bonds of the authority, without a 114.11 referendum, which are payable primarily from such taxes. If the 114.12 maximum amount of principal and interest to become due in any 114.13 year on all outstanding bonds issued under this section which 114.14 are general obligations, including the bonds to be issued, does 114.15 not exceed 0.04835 percent of the market value of taxable 114.16 property in the municipality or municipalities named in its 114.17 organization resolution for taxes payable in the year in which 114.18 the bonds are issued, the authority may levy a tax on all 114.19 taxable property in such municipality or municipalities without 114.20 limit as to rate or amount to pay principal and interest on its 114.21 general obligation bonds when due. 114.22 Sec. 30. [415.18] [SIDEWALK UTILITY.] 114.23 A home rule charter or statutory city may establish a 114.24 sidewalk utility as provided in section 412.321 including the 114.25 voting requirement of section 412.321, subdivision 2, for other 114.26 utilities in statutory cities, or as otherwise provided by law 114.27 or charter for utilities for home rule charter cities. Section 114.28 412.321 applies to the creation of the sidewalk utility except 114.29 that the creation of the sidewalk utility requires approval by 114.30 only a majority vote of those voting on the proposition. The 114.31 purpose of the sidewalk utility is to acquire land for, 114.32 construct, maintain, and replace public sidewalks and 114.33 appurtenances to public sidewalks. Snow and ice removal are 114.34 expressly not included in the purposes of the utility. Utility 114.35 charges may be imposed on any reasonable and equitable basis on 114.36 which other utility charges are made including a uniform charge 115.1 per account for another utility to be added to the account for 115.2 the other utility but separately listed. Revenues received for 115.3 sidewalk utilities must be segregated from other funds as 115.4 otherwise provided for utility revenues and may be used only for 115.5 sidewalk utility purposes. 115.6 Sec. 31. Minnesota Statutes 1998, section 428A.11, 115.7 subdivision 6, is amended to read: 115.8 Subd. 6. [HOUSING UNIT.] "Housing unit" means real 115.9 property and improvements thereon consisting of a one-dwelling 115.10 unit, or an apartment as described in chapter 515or, 515A, or 115.11 515B, that is occupied by a person or family for use as a 115.12 residence. 115.13 Sec. 32. Minnesota Statutes 1998, section 428A.11, is 115.14 amended by adding a subdivision to read: 115.15 Subd. 7. [AUTHORITY.] "Authority" means an economic 115.16 development authority created pursuant to section 469.091 or a 115.17 housing and redevelopment authority created pursuant to section 115.18 469.003. 115.19 Sec. 33. Minnesota Statutes 1998, section 428A.11, is 115.20 amended by adding a subdivision to read: 115.21 Subd. 8. [IMPLEMENTING ENTITY.] "Implementing entity" 115.22 means the city or authority designated in the enabling ordinance 115.23 as responsible for implementing and administering the housing 115.24 improvement area. 115.25 Sec. 34. Minnesota Statutes 1998, section 428A.13, 115.26 subdivision 1, is amended to read: 115.27 Subdivision 1. [ORDINANCE.] The governing body of the city 115.28 may adopt an ordinance establishingaone or more housing 115.29 improvementareaareas. The ordinance must specifically 115.30 describe the portion of the city to be included in the area, the 115.31 basis for the imposition of the fees, and the number of years 115.32 the fee will be in effect. In addition, the ordinance must 115.33 include findings that without the housing improvement area, the 115.34 proposed improvements could not be made by the condominium 115.35 associations or housing unit owners, and the designation is 115.36 needed to maintain and preserve the housing units within the 116.1 housing improvement area. The ordinance shall designate the 116.2 implementing entity. The ordinance may not be adopted until a 116.3 public hearing has been held regarding the ordinance. The 116.4 ordinance may be amended by the governing body of the city, 116.5 provided the governing body complies with the public hearing 116.6 notice provisions of subdivision 2. Within 30 days after 116.7 adoption of the ordinance under this subdivision, the governing 116.8 body shall send a copy of the ordinance to the commissioner of 116.9 revenue. 116.10 Sec. 35. Minnesota Statutes 1998, section 428A.13, 116.11 subdivision 3, is amended to read: 116.12 Subd. 3. [PROPOSED HOUSING IMPROVEMENTS.] At the public 116.13 hearing held under subdivision 2, thecityproposed implementing 116.14 entity shall provide a preliminary listing of the housing 116.15 improvements to be made in the area. The listing shall identify 116.16 those improvements, if any, that are proposed to be made to all 116.17 or a portion of the common elements of a condominium. The 116.18 listing shall also identify those housing units that have 116.19 completed the proposed housing improvements and are proposed to 116.20 be exempted from a portion of the fee. In preparing the list 116.21 thecityproposed implementing entity shall consult with the 116.22 residents of the area and the condominium associations. 116.23 Sec. 36. Minnesota Statutes 1998, section 428A.14, 116.24 subdivision 1, is amended to read: 116.25 Subdivision 1. [AUTHORITY.] Fees may be imposed by the 116.26cityimplementing entity on the housing units within the housing 116.27 improvement area at a rate, term, or amount sufficient to 116.28 produce revenue required to provide housing improvements in the 116.29 area to reimburse the implementing entity for advances made to 116.30 pay for the housing improvements or to pay principal or interest 116.31 on, and premiums, if any, of bonds issued by the implementing 116.32 entity pursuant to section 428A.16. The fee can be imposed on 116.33 the basis of the tax capacity of the housing unit, or the total 116.34 amount of square footage of the housing unit, or a method 116.35 determined by the council and specified in the resolution. 116.36 Before the imposition of the fees, a hearing must be held and 117.1 notice must be published in the official newspaper at least 117.2 seven days before the hearing and shall be mailed at least seven 117.3 days before the hearing to any housing unit owner subject to a 117.4 fee. For purposes of this section, the notice must also include: 117.5 (1) a statement that all interested persons will be given 117.6 an opportunity to be heard at the hearing regarding a proposed 117.7 housing improvement fee; 117.8 (2) the estimated cost of improvements including 117.9 administrative costs to be paid for in whole or in part by the 117.10 fee imposed under the ordinance; 117.11 (3) the amount to be charged against the particular 117.12 property; 117.13 (4) the right of the property owner to prepay the entire 117.14 fee; 117.15 (5) the number of years the fee will be in effect; and 117.16 (6) a statement that the petition requirements of section 117.17 428A.12 have either been met or do not apply to the proposed fee. 117.18 Within six months of the public hearing, thecity117.19 implementing entity may adopt a resolution imposing a fee within 117.20 the area not exceeding the amount expressed in the notice issued 117.21 under this section. 117.22 Prior to adoption of the resolution approving the fee, the 117.23 condominium associations located in the housing improvement area 117.24 shall submit to thecityimplementing entity a financial plan 117.25 prepared by an independent third party, acceptable to thecity117.26 implementing entity and associations, that provides for the 117.27 associations to finance maintenance and operation of the common 117.28 elements in the condominium and a long-range plan to conduct and 117.29 finance capital improvements. 117.30 Sec. 37. Minnesota Statutes 1998, section 428A.15, is 117.31 amended to read: 117.32 428A.15 [COLLECTION OF FEES.] 117.33 Thecityimplementing entity may provide for the collection 117.34 of the housing improvement fees according to the terms of 117.35 section 428A.05. 117.36 Sec. 38. Minnesota Statutes 1998, section 428A.16, is 118.1 amended to read: 118.2 428A.16 [BONDS.] 118.3 At any time after a contract for the construction of all or 118.4 part of an improvement authorized under sections 428A.11 to 118.5 428A.20 has been entered into or the work has been ordered, the 118.6governing body of the cityimplementing entity may issue 118.7 obligations in the amount it deems necessary to defray in whole 118.8 or in part the expense incurred and estimated to be incurred in 118.9 making the improvement, including every item of cost from 118.10 inception to completion and all fees and expenses incurred in 118.11 connection with the improvement or the financing. 118.12 The obligations are payable primarily out of the proceeds 118.13 of the fees imposed under section 428A.14, or from any other 118.14 special assessments or revenues available to be pledged for 118.15 their payment under charter or statutory authority, or from two 118.16 or more of those sources. The governing body of the city, or if 118.17 the governing bodies are the same or consist of identical 118.18 membership, the authority may, by resolution adopted prior to 118.19 the sale of obligations, pledge the full faith, credit, and 118.20 taxing power of the city toassurebonds issued by it to ensure 118.21 payment of the principal and interest if the proceeds of the 118.22 fees in the area are insufficient to pay the principal and 118.23 interest. The obligations must be issued in accordance with 118.24 chapter 475, except that an election is not required, and the 118.25 amount of the obligations are not included in determination of 118.26 the net debt of the city under the provisions of any law or 118.27 charter limiting debt. 118.28 Sec. 39. Minnesota Statutes 1998, section 428A.17, is 118.29 amended to read: 118.30 428A.17 [ADVISORY BOARD.] 118.31 Thegoverning body of the cityimplementing entity may 118.32 create and appoint an advisory board for the housing improvement 118.33 area in the city to advise thegoverning bodyimplementing 118.34 entity in connection with the planning and construction of 118.35 housing improvements. In appointing the board, thecouncil118.36 implementing entity shall consider for membership members of 119.1 condominium associations located in the housing improvement 119.2 area. The advisory board shall make recommendations to 119.3 thegoverning bodyimplementing entity to provide improvements 119.4 or impose fees within the housing improvement area. Before the 119.5 adoption of a proposal by thegoverning bodyimplementing entity 119.6 to provide improvements within the housing improvement area, the 119.7 advisory board of the housing improvement area shall have an 119.8 opportunity to review and comment upon the proposal. 119.9 Sec. 40. Minnesota Statutes 1998, section 428A.19, is 119.10 amended to read: 119.11 428A.19 [ANNUAL REPORTS.] 119.12 Each condominium association located within the housing 119.13 improvement area must, by August 15 annually, submit a copy of 119.14 its audited financial statements to thecityimplementing entity. 119.15 The city may also, as part of the enabling ordinance, require 119.16 the submission of other relevant information from the 119.17 associations. 119.18 Sec. 41. Minnesota Statutes 1998, section 465.82, is 119.19 amended by adding a subdivision to read: 119.20 Subd. 4. [DIFFERENTIAL TAXATION.] The plan for cooperation 119.21 and combination adopted in accordance with subdivision 1 may 119.22 establish that the tax rate of the local government unit with 119.23 the lesser tax rate prior to the effective date of combination 119.24 shall be increased in substantially equal proportions over not 119.25 more than six years to equality with the tax rate on the 119.26 property already within the borders of the local unit of 119.27 government with the higher tax rate. The appropriate period of 119.28 time, if any, for transition to the higher tax rate shall be 119.29 based on the time reasonably required to effectively provide 119.30 equal municipal services to the residents of the local unit of 119.31 government with the lower tax rate. 119.32 Sec. 42. Minnesota Statutes 1998, section 473.39, is 119.33 amended by adding a subdivision to read: 119.34 Subd. 1g. [OBLIGATIONS; 2000-2002.] In addition to the 119.35 authority in subdivisions 1a, 1b, 1c, 1d, and 1e, the council 119.36 may issue certificates of indebtedness, bonds, or other 120.1 obligations under this section in an amount not exceeding 120.2 $52,000,000, which may be used for capital expenditures as 120.3 prescribed in the council's transit capital improvement program 120.4 and for related costs, including the costs of issuance and sale 120.5 of the obligations. 120.6 Sec. 43. Minnesota Statutes 1998, section 473.39, is 120.7 amended by adding a subdivision to read: 120.8 Subd. 1h. [OBLIGATIONS.] After June 30, 2001, in addition 120.9 to the authority in subdivisions 1a, 1b, 1c, 1d, 1e, and 1g, the 120.10 council may issue certificates of indebtedness, bonds, or other 120.11 obligations under this section for capital expenditures as 120.12 prescribed in the council's transit capital improvement program 120.13 and for related costs, including the costs of issuance and sale 120.14 of the obligations. The amount of the obligations issued under 120.15 this subdivision in any calendar year must not exceed the 120.16 following limit, except as provided in this subdivision: 120.17 (1) for calendar year 2002, the limit is $27,000,000; and 120.18 (2) for each subsequent year, the limit equals the previous 120.19 calendar year's limit calculated under this subdivision 120.20 multiplied by an index for market valuation changes equal to the 120.21 total market valuation of all taxable property located within 120.22 the transit taxing district for the current taxes payable year 120.23 divided by the total market valuation of all taxable property 120.24 located within the transit taxing district for the previous 120.25 taxes payable year. For any year in which the council does not 120.26 issue obligations totaling the limit calculated under this 120.27 subdivision, the remaining available amount may be carried 120.28 forward to subsequent years. The council may issue obligations 120.29 in a carry-forward year in an amount exceeding the annual limit 120.30 for that year by the amount carried forward, but the amount 120.31 carried forward is not a permanent increase in the annual limit 120.32 calculated under this subdivision. 120.33 For the purposes of this subdivision, "total market 120.34 valuation" means the total market valuation of all taxable 120.35 property within the transit taxing district without valuation 120.36 adjustments for fiscal disparities under chapter 473F, tax 121.1 increment financing under sections 469.174 to 469.179, and high 121.2 voltage transmission lines under section 273.425. "Transit 121.3 taxing district" means the transit taxing district established 121.4 in section 473.446. 121.5 Sec. 44. Minnesota Statutes 1998, section 473.898, 121.6 subdivision 3, is amended to read: 121.7 Subd. 3. [LIMITATIONS.] The principal amount of the bonds 121.8 issued pursuant to subdivision 1, exclusive of any original 121.9 issue discount, shall not exceed the amount of 121.10$10,000,000$13,306,300, plus the amount the council determines 121.11 necessary to pay the costs of issuance, fund reserves, debt 121.12 service, and pay for any bond insurance or other credit 121.13 enhancement. 121.14 Sec. 45. Minnesota Statutes 1998, section 475.52, 121.15 subdivision 1, is amended to read: 121.16 Subdivision 1. [STATUTORY CITIES.] Any statutory city may 121.17 issue bonds or other obligations for the acquisition or 121.18 betterment of public buildings, means of garbage disposal, 121.19 hospitals, nursing homes, homes for the aged, schools, 121.20 libraries, museums, art galleries, parks, playgrounds, stadia, 121.21 sewers, sewage disposal plants, subways, streets, sidewalks, 121.22 warning systems; for any utility or other public convenience 121.23 from which a revenue is or may be derived; for a permanent 121.24 improvement revolving fund; for changing, controlling or 121.25 bridging streams and other waterways; for the acquisition and 121.26 betterment of bridges and roads within two miles of the 121.27 corporate limits, for the acquisition of development rights in 121.28 the form of conservation easements under chapter 84C; and for 121.29 acquisition of equipment for snow removal, street construction 121.30 and maintenance, or fire fighting. Without limitation by the 121.31 foregoing the city may issue bonds to provide money for any 121.32 authorized corporate purpose except current expenses. 121.33 Sec. 46. Minnesota Statutes 1998, section 475.52, 121.34 subdivision 3, is amended to read: 121.35 Subd. 3. [COUNTIES.] Any county may issue bonds for the 121.36 acquisition or betterment of courthouses, county administrative 122.1 buildings, health or social service facilities, correctional 122.2 facilities, law enforcement centers, jails, morgues, libraries, 122.3 parks, and hospitals, for roads and bridges within the county or 122.4 bordering thereon and for road equipment and machinery and for 122.5 ambulances and related equipment, for the acquisition of 122.6 development rights in the form of conservation easements under 122.7 chapter 84C, and for capital equipment for the administration 122.8 and conduct of elections providing the equipment is uniform 122.9 countywide, except that the power of counties to issue bonds in 122.10 connection with a library shall not exist in Hennepin county. 122.11 Sec. 47. Minnesota Statutes 1998, section 475.52, 122.12 subdivision 4, is amended to read: 122.13 Subd. 4. [TOWNS.] Any town may issue bonds for the 122.14 acquisition and betterment of town halls, town roads and 122.15 bridges, nursing homes and homes for the aged, and for 122.16 acquisition of equipment for snow removal, road construction or 122.17 maintenance, and fire fighting, for the acquisition of 122.18 development rights in the form of conservation easements under 122.19 chapter 84C and for the acquisition and betterment of any 122.20 buildings to house and maintain town equipment. 122.21 Sec. 48. Minnesota Statutes 1998, section 477A.011, 122.22 subdivision 36, is amended to read: 122.23 Subd. 36. [CITY AID BASE.] (a) Except as provided in 122.24 paragraphs (b), (c), and (d)to (k), "city aid base" means, for 122.25 each city, the sum of the local government aid and equalization 122.26 aid it was originally certified to receive in calendar year 1993 122.27 under Minnesota Statutes 1992, section 477A.013, subdivisions 3 122.28 and 5, and the amount of disparity reduction aid it received in 122.29 calendar year 1993 under Minnesota Statutes 1992, section 122.30 273.1398, subdivision 3. 122.31 (b) For aids payable in 1996 and thereafter, a city that in 122.32 1992 or 1993 transferred an amount from governmental funds to 122.33 its sewer and water fund, which amount exceeded its net levy for 122.34 taxes payable in the year in which the transfer occurred, has a 122.35 "city aid base" equal to the sum of (i) its city aid base, as 122.36 calculated under paragraph (a), and (ii) one-half of the 123.1 difference between its city aid distribution under section 123.2 477A.013, subdivision 9, for aids payable in 1995 and its city 123.3 aid base for aids payable in 1995. 123.4 (c) The city aid base for any city with a population less 123.5 than 500 is increased by $40,000 for aids payable in calendar 123.6 year 1995 and thereafter, and the maximum amount of total aid it 123.7 may receive under section 477A.013, subdivision 9, paragraph 123.8 (c), is also increased by $40,000 for aids payable in calendar 123.9 year 1995 only, provided that: 123.10 (i) the average total tax capacity rate for taxes payable 123.11 in 1995 exceeds 200 percent; 123.12 (ii) the city portion of the tax capacity rate exceeds 100 123.13 percent; and 123.14 (iii) its city aid base is less than $60 per capita. 123.15 (d) The city aid base for a city is increased by $20,000 in 123.16 1998 and thereafter and the maximum amount of total aid it may 123.17 receive under section 477A.013, subdivision 9, paragraph (c), is 123.18 also increased by $20,000 in calendar year 1998 only, provided 123.19 that: 123.20 (i) the city has a population in 1994 of 2,500 or more; 123.21 (ii) the city is located in a county, outside of the 123.22 metropolitan area, which contains a city of the first class; 123.23 (iii) the city's net tax capacity used in calculating its 123.24 1996 aid under section 477A.013 is less than $400 per capita; 123.25 and 123.26 (iv) at least four percent of the total net tax capacity, 123.27 for taxes payable in 1996, of property located in the city is 123.28 classified as railroad property. 123.29 (e) The city aid base for a city is increased by $200,000 123.30 in 1999 and thereafter and the maximum amount of total aid it 123.31 may receive under section 477A.013, subdivision 9, paragraph 123.32 (c), is also increased by $200,000 in calendar year 1999 only, 123.33 provided that: 123.34 (i) the city was incorporated as a statutory city after 123.35 December 1, 1993; 123.36 (ii) its city aid base does not exceed $5,600; and 124.1 (iii) the city had a population in 1996 of 5,000 or more. 124.2 (f) The city aid base for a city is increased by $450,000 124.3 in 1999 to 2008 and the maximum amount of total aid it may 124.4 receive under section 477A.013, subdivision 9, paragraph (c), is 124.5 also increased by $450,000 in calendar year 1999 only, provided 124.6 that: 124.7 (i) the city had a population in 1996 of at least 50,000; 124.8 (ii) its population had increased by at least 40 percent in 124.9 the ten-year period ending in 1996; and 124.10 (iii) its city's net tax capacity for aids payable in 1998 124.11 is less than $700 per capita. 124.12 (g) Beginning in 2002, the city aid base for a city is 124.13 equal to the sum of its city aid base in 2001 and the amount of 124.14 additional aid it was certified to receive under section 477A.06 124.15 in 2001. For 2002 only, the maximum amount of total aid a city 124.16 may receive under section 477A.013, subdivision 9, paragraph 124.17 (c), is also increased by the amount it was certified to receive 124.18 under section 477A.06 in 2001. 124.19 (h) The city aid base for a city is increased by $150,000 124.20 for aids payable in 2000 and thereafter, and the maximum amount 124.21 of total aid it may receive under section 477A.013, subdivision 124.22 9, paragraph (c), is also increased by $150,000 in calendar year 124.23 2000 only, provided that: 124.24 (1) the city has a population that is greater than 1,000 124.25 and less than 2,500; 124.26 (2) its commercial and industrial percentage for aids 124.27 payable in 1999 is greater than 45 percent; and 124.28 (3) the total market value of all commercial and industrial 124.29 property in the city for assessment year 1999 is at least 15 124.30 percent less than the total market value of all commercial and 124.31 industrial property in the city for assessment year 1998. 124.32 (i) The city aid base for a city is increased by $200,000 124.33 in 2000 and thereafter, and the maximum amount of total aid it 124.34 may receive under section 477A.013, subdivision 9, paragraph 124.35 (c), is also increased by $200,000 in calendar year 2000 only, 124.36 provided that: 125.1 (1) the city had a population in 1997 of 2,500 or more; 125.2 (2) the net tax capacity of the city used in calculating 125.3 its 1999 aid under section 477A.013 is less than $650 per 125.4 capita; 125.5 (3) the pre-1940 housing percentage of the city used in 125.6 calculating 1999 aid under section 477A.013 is greater than 12 125.7 percent; 125.8 (4) the 1999 local government aid of the city under section 125.9 477A.013 is less than 20 percent of the amount that the formula 125.10 aid of the city would have been if the need increase percentage 125.11 was 100 percent; and 125.12 (5) the city aid base of the city used in calculating aid 125.13 under section 477A.013 is less than $7 per capita. 125.14 (j) The city aid base for a city is increased by $225,000 125.15 in calendar years 2000 to 2002 and the maximum amount of total 125.16 aid it may receive under section 477A.013, subdivision 9, 125.17 paragraph (c), is also increased by $225,000 in calendar year 125.18 2000 only, provided that: 125.19 (1) the city had a population of at least 5,000; 125.20 (2) its population had increased by at least 50 percent in 125.21 the ten-year period ending in 1997; 125.22 (3) the city is located outside of the Minneapolis-St. Paul 125.23 metropolitan statistical area as defined by the United States 125.24 Bureau of the Census; and 125.25 (4) the city received less than $30 per capita in aid under 125.26 section 477A.013, subdivision 9, for aids payable in 1999. 125.27 (k) The city aid base for a city is increased by $102,000 125.28 in 2000 and thereafter, and the maximum amount of total aid it 125.29 may receive under section 477A.013, subdivision 9, paragraph 125.30 (c), is also increased by $102,000 in calendar year 2000 only, 125.31 provided that: 125.32 (1) the city has a population in 1997 of 2,000 or more; 125.33 (2) the net tax capacity of the city used in calculating 125.34 its 1999 aid under section 477A.013 is less than $455 per 125.35 capita; 125.36 (3) the net levy of the city used in calculating 1999 aid 126.1 under section 477A.013 is greater than $195 per capita; and 126.2 (4) the 1999 local government aid of the city under section 126.3 477A.013 is less than 38 percent of the amount that the formula 126.4 aid of the city would have been if the need increase percentage 126.5 was 100 percent. 126.6 Sec. 49. Laws 1988, chapter 645, section 3, is amended to 126.7 read: 126.8 Sec. 3. [TAX; PAYMENT OF EXPENSES.] 126.9 (a) The tax levied by the hospital district under Minnesota 126.10 Statutes, section 447.34, must not be levied at a rate that 126.11 exceeds2 mills.063 percent of taxable market value.The126.12proceeds126.13 (b) .048 percent of taxable market value ofthattax in 126.14 paragraph (a) may be used only for acquisition, betterment, and 126.15 maintenance of the district's hospital and nursing home 126.16 facilities and equipment, and not for administrative or salary 126.17 expenses. 126.18 (c) .015 percent of taxable market value of the tax in 126.19 paragraph (a) may be used solely for the purpose of capital 126.20 expenditures as it relates to ambulance acquisitions for the 126.21 Cook ambulance service and the Orr ambulance service and not for 126.22 administrative or salary expenses. 126.23 The part of the levy referred to in paragraph (c) must be 126.24 administered by the Cook Hospital and passed on directly to the 126.25 Cook area ambulance service board and the city of Orr to be held 126.26 in trust until funding for a new ambulance is needed by either 126.27 the Cook ambulance service or the Orr ambulance service. 126.28 Sec. 50. Laws 1997, chapter 231, article 2, section 68, 126.29 subdivision 3, as amended by Laws 1998, chapter 389, article 3, 126.30 section 36, is amended to read: 126.31 Subd. 3. [MORATORIUM ON CHANGES IN ASSESSMENT PRACTICES.] 126.32 (a) An assessor may not change the current practices or policies 126.33 used generally in assessing elderly assisted living facilities. 126.34 (b) An assessor may not change the assessment of an 126.35 existing elderly assisted living facility, unless the change is 126.36 made as a result of a change in ownership, occupancy, or use of 127.1 the facility. This paragraph does not apply to: 127.2 (1) a facility that was constructed during calendar year 127.3 1997, 1998, or 1999; 127.4 (2) a facility that was converted to an elderly assisted 127.5 living facility during calendar year 1997, 1998, or 1999; or 127.6 (3) a change in market value. 127.7 (c) This subdivision expires and no longer applies on the 127.8 earlier of: 127.9 (1) the enactment of legislation establishing criteria for 127.10 the property taxation of elderly assisted living facilities; or 127.11 (2) final adjournment of the19992000 regular legislative 127.12 session. 127.13 Sec. 51. [ABATEMENT OF TAXES.] 127.14 Subdivision 1. [PROPERTY DEFINED.] As used in this section 127.15 and section 52, "property" means property located in Lake county 127.16 that meets the following description: 127.17 All that part of Government Lot Two (2) of Section One (1) 127.18 in Township Fifty-two (52) North, Range Eleven (11) West of the 127.19 Fourth Principal Meridian, lying within the following described 127.20 lines: 127.21 Commencing at a point on the North-South quarter line of 127.22 said Section 1 which is 20 feet south of the center of said 127.23 Section 1 measured along said North-South quarter line; 127.24 thence easterly at a right angle to said North-South 127.25 quarter line a distance of 5 feet to the point of Beginning; 127.26 thence continuing in an easterly direction at a right angle 127.27 to said North-South quarter line a distance of 335 feet; 127.28 thence southerly at a right angle to the last described 127.29 line a distance of 80 feet; 127.30 thence easterly at a right angle to the last described line 127.31 a distance of 210 feet; 127.32 thence southerly at a right angle to the last described 127.33 line a distance of 255 feet; 127.34 thence southeasterly at an angle of 102 degrees to the last 127.35 described line to the ordinary low-water mark of Agate Bay; 127.36 thence easterly along said ordinary low-water mark to the 128.1 East boundary line of said Government Lot 2; 128.2 thence in a northerly direction along said East boundary 128.3 line to a point on said East boundary line which is 75 feet 128.4 distant in a northerly direction from the East-West quarter line 128.5 of said Section 1, extended, as measured along said East 128.6 boundary line; 128.7 thence in a northwesterly direction to a point which is 190 128.8 feet easterly measured at a right angle to the North-South 128.9 quarter line of said Section 1 from a point on the North-South 128.10 quarter line, which point is 725 feet northerly of the center of 128.11 said Section 1 when measured along said North-South quarter 128.12 line; 128.13 thence in a westerly direction at a right angle to said 128.14 North-South quarter line a distance of 185 feet; 128.15 thence southerly along a line parallel to and 5 feet 128.16 distant easterly from said North-South quarter line a distance 128.17 of 230 feet; 128.18 thence easterly at a right angle to the last described line 128.19 a distance of 130 feet; 128.20 thence southerly at a right angle to the last described 128.21 line a distance of 119.27 feet; 128.22 thence westerly at a right angle to the last described line 128.23 a distance of 130 feet; 128.24 thence southerly along a line parallel to and 5 feet 128.25 distant easterly from said North-South quarter line a distance 128.26 of 395.73 feet to the point of beginning. 128.27 Subd. 2. [AUTHORIZATION.] Upon a majority vote of its 128.28 members, the governing bodies of each of Lake county, the city 128.29 of Two Harbors, and Lake Superior independent school district 128.30 No. 381, may abate the taxes levied on the property described in 128.31 subdivision 1 in 1979 to 1990, payable in 1980 to 1991, as well 128.32 as any interest and penalties due on those taxes. 128.33 Sec. 52. [RECORDING OF CONVEYANCE AUTHORIZED.] 128.34 Notwithstanding Minnesota Statutes, section 272.12, or any 128.35 other law to the contrary, if the governing bodies of Lake 128.36 county, the city of Two Harbors, and Lake Superior independent 129.1 school district No. 381 have all abated the taxes, interest, and 129.2 penalties as provided in section 51, subdivision 2, the county 129.3 auditor may record the conveyance of the property described in 129.4 section 51, subdivision 1. 129.5 Sec. 53. [NORTH FORK CROW RIVER WATERSHED DISTRICT.] 129.6 Subdivision 1. [LEVY AUTHORIZED.] Notwithstanding 129.7 Minnesota Statutes, section 103D.905, subdivision 3, the North 129.8 Fork Crow River watershed district may annually levy up to 129.9 .04836 percent of taxable market value, or $140,000, whichever 129.10 is less, for its administrative fund. 129.11 Subd. 2. [EFFECTIVE DATE.] This section is effective, 129.12 without local approval, beginning with taxes levied in 1999, 129.13 payable in 2000. 129.14 Sec. 54. [SAUK RIVER WATERSHED DISTRICT.] 129.15 Notwithstanding Minnesota Statutes, section 103D.905, 129.16 subdivision 3, the Sauk river watershed district may annually 129.17 levy up to $200,000 for its administrative fund for taxes 129.18 payable in 2000, 2001, 2002, 2003, and 2004. 129.19 Sec. 55. [CEMETERY LEVY FOR SAWYER BY CARLTON COUNTY.] 129.20 Subdivision 1. [LEVY AUTHORIZED.] Notwithstanding other 129.21 law to the contrary, the Carlton county board of commissioners 129.22 may levy in and for the unorganized township of Sawyer an amount 129.23 up to $1,000 annually for cemetery purposes, beginning with 129.24 taxes payable in 2000 and ending with taxes payable in 2009. 129.25 Subd. 2. [EFFECTIVE DATE.] This section is effective June 129.26 1, 1999, without local approval. 129.27 Sec. 56. [APPLICATION.] 129.28 Sections 42 to 44 apply in the counties of Anoka, Carver, 129.29 Dakota, Hennepin, Ramsey, Scott, and Washington. 129.30 Sec. 57. [LOCAL PERFORMANCE AID RECIPIENTS; OTHER AID 129.31 INCREASES.] 129.32 (a) If a county received local performance aid under 129.33 Minnesota Statutes, section 477A.05, in calendar year 1999, the 129.34 amount of homestead and agricultural credit aid determined and 129.35 payable to the county under Minnesota Statutes, section 129.36 273.1398, in 2000 and subsequent years is increased by the 130.1 amount of performance aid it received in 1999. 130.2 (b) If a city received local performance aid under 130.3 Minnesota Statutes, section 477A.05, in calendar year 1999, the 130.4 city aid base of the city under Minnesota Statutes, section 130.5 477A.011, subdivision 36, is increased for aid payable in 2000 130.6 and subsequent years by the amount of performance aid it 130.7 received in 1999, and the maximum amount of total aid it may 130.8 receive under Minnesota Statutes, section 477A.013, subdivision 130.9 9, paragraph (c), is also increased by that amount in calendar 130.10 year 2000 only. 130.11 (c) For purposes of determining the limitation on aid 130.12 increases under Minnesota Statutes, section 477A.013, 130.13 subdivision 9, paragraph (b), for aid payable in 2000, the sum 130.14 of the aid to all cities in 2000 does not include the aid 130.15 increase under paragraph (a) of this section. 130.16 Sec. 58. [RECOMMENDATIONS ON UTILITY PERSONAL PROPERTY TAX 130.17 REVENUES.] 130.18 The commissioner of revenue shall, upon consultation with 130.19 affected parties, develop a detailed proposal for a fair and 130.20 reasonable approach to the replacement of the revenue that would 130.21 be lost to local units of government as a result of the 130.22 elimination of the tax on the personal property of electric 130.23 utilities. The commissioner shall report on the proposal by 130.24 September 1, 2000, to the chairs of the senate committees on 130.25 taxes and jobs, energy and community development, and the house 130.26 of representatives committees on taxes and jobs and economic 130.27 development, and to the governor. 130.28 Sec. 59. [EDUCATION LEVY REDUCTION APPROPRIATION.] 130.29 In addition to any amount appropriated by other law, 130.30 $17,627,000 is appropriated from the general fund to the 130.31 commissioner of children, families, and learning in fiscal year 130.32 2001, and $19,585,000 in fiscal year 2002 and thereafter, to 130.33 fund a reduction in the statewide general education property tax 130.34 levy. The fiscal year 2002 appropriation includes $1,958,000 130.35 for 2001 and $17,627,000 for 2002. 130.36 Sec. 60. [REPEALER.] 131.1 (a) Minnesota Statutes 1998, section 273.1383, is repealed. 131.2 (b) Minnesota Statutes 1998, section 477A.05, is repealed. 131.3 (c) Minnesota Statutes 1998, section 428A.21, is repealed. 131.4 Sec. 61. [EFFECTIVE DATE.] 131.5 (a) Sections 4; 5; 6; 11; 12; 13; 15; 16; 17; 20; 22; 41; 131.6 and 53 are effective for taxes levied in 1999, payable in 2000, 131.7 and thereafter. 131.8 (b) Section 9 is effective retroactively for property taxes 131.9 payable in 1998 and thereafter. 131.10 (c) Sections 19; 57; and 60, paragraph (b), are effective 131.11 for aids payable in 2000, and thereafter. 131.12 (d) Section 21 is effective for net proceeds received after 131.13 the date of final enactment of this act. 131.14 (e) The .0015 percent of taxable market value levy 131.15 described in section 49, paragraph (c), is effective for the 131.16 cities of Cook and Orr and the counties of St. Louis and 131.17 Koochiching for affected parts of those counties on January 1, 131.18 2000, to be requested in the year 2000, with the first payment 131.19 to be received in 2001. 131.20 (f) Sections 51 and 52 are effective the day following 131.21 final enactment, upon approval by and compliance with Minnesota 131.22 Statutes, section 645.021, subdivision 3, by the governing 131.23 bodies of Lake county, the city of Two Harbors, and Lake 131.24 Superior independent school district No. 381. 131.25 (g) Sections 3; 14; 44; and 60, paragraph (a), are 131.26 effective the day following final enactment. 131.27 ARTICLE 10 131.28 STATE FUNDING OF DISTRICT COURTS 131.29 TRANSFER OF FINES, FEES, AND OTHER MONEY TO STATE 131.30 Section 1. Minnesota Statutes 1998, section 97A.065, 131.31 subdivision 2, is amended to read: 131.32 Subd. 2. [FINES AND FORFEITED BAIL.] (a) Fines and 131.33 forfeited bail collected from prosecutions of violations of: 131.34 the game and fish laws; sections 84.091 to 84.15; sections 84.81 131.35 to 84.91; section 169.121, when the violation involved an 131.36 off-road recreational vehicle as defined in section 169.01, 132.1 subdivision 86; chapter 348; and any other law relating to wild 132.2 animals or aquatic vegetation, must be paid to the treasurer of 132.3 the county where the violation is prosecuted. The county 132.4 treasurer shall submit one-half of the receipts to the 132.5 commissioner and credit the balance to the county general 132.6 revenue fund except as provided in paragraphs (b), (c), and 132.7 (d). In a county in a judicial district under section 480.181, 132.8 subdivision 1, paragraph (b), the share that would otherwise go 132.9 to the county under this paragraph must be submitted to the 132.10 state treasurer for deposit in the state treasury and credited 132.11 to the general fund. 132.12 (b) The commissioner must reimburse a county, from the game 132.13 and fish fund, for the cost of keeping prisoners prosecuted for 132.14 violations under this section if the county board, by 132.15 resolution, directs: (1) the county treasurer to submit all 132.16 fines and forfeited bail to the commissioner; and (2) the county 132.17 auditor to certify and submit monthly itemized statements to the 132.18 commissioner. 132.19 (c) The county treasurer shall submit one-half of the 132.20 receipts collected under paragraph (a) from prosecutions of 132.21 violations of sections 84.81 to 84.91, and 169.121, except 132.22 receipts that are surcharges imposed under section 357.021, 132.23 subdivision 6, to the state treasurer and credit the balance to 132.24 the county general fund. The state treasurer shall credit these 132.25 receipts to the snowmobile trails and enforcement account in the 132.26 natural resources fund. 132.27 (d) The county treasurer shall indicate the amount of the 132.28 receipts that are surcharges imposed under section 357.021, 132.29 subdivision 6, and shall submit all of those receipts to the 132.30 state treasurer. 132.31 Sec. 2. Minnesota Statutes 1998, section 273.1398, 132.32 subdivision 2, is amended to read: 132.33 Subd. 2. [HOMESTEAD AND AGRICULTURAL CREDIT AID.] 132.34 Homestead and agricultural credit aid for each unique taxing 132.35 jurisdiction equals the product of (1) the homestead and 132.36 agricultural credit aid base, and (2) the growth adjustment 133.1 factor, plus the net tax capacity adjustment and the fiscal 133.2 disparity adjustment.For aid payable in 2000, each county133.3shall have its homestead and agricultural credit aid permanently133.4reduced by an amount equal to one-third of the additional amount133.5received by the county under section 477A.03, subdivision 2,133.6paragraph (c), clause (ii).133.7 Sec. 3. Minnesota Statutes 1998, section 273.1398, is 133.8 amended by adding a subdivision to read: 133.9 Subd. 4a. [AID OFFSET FOR COURT COSTS.] (a) By August 15, 133.10 1999, the supreme court shall determine and certify to the 133.11 commissioner of revenue for each county, other than counties 133.12 located in the eighth judicial district, the county's share of 133.13 the costs assumed under 1999 S.F. No. 2221, article 7, during 133.14 the fiscal year beginning July 1, 2000, less an amount equal to 133.15 the county's share of transferred fines collected by the trial 133.16 courts in the county during calendar year 1998. 133.17 (b) Payments to a county under subdivision 2 or section 133.18 273.166 for calendar year 2000 must be reduced by an amount 133.19 equal to 100 percent of the net cost to the state for assumption 133.20 of district court costs as certified in paragraph (a). 133.21 (c) Payments to a county under subdivision 2 or section 133.22 273.166 for calendar year 2001 must be reduced by an amount 133.23 equal to 50 percent of the net cost to the state for assumption 133.24 of district court costs as certified in paragraph (a). 133.25 (d) Payments to a county under subdivision 2 or section 133.26 273.166, in calendar year 2002 and thereafter must be 133.27 permanently reduced by an amount equal to 100 percent of the net 133.28 cost to the state for assumption of district court costs as 133.29 certified in paragraph (a). 133.30 Sec. 4. Minnesota Statutes 1998, section 299D.03, 133.31 subdivision 5, is amended to read: 133.32 Subd. 5. [FINES AND FORFEITED BAIL MONEY.] (a) All fines 133.33 and forfeited bail money, from traffic and motor vehicle law 133.34 violations, collected from persons apprehended or arrested by 133.35 officers of the state patrol, shall be paid by the person or 133.36 officer collecting the fines, forfeited bail money or 134.1 installments thereof, on or before the tenth day after the last 134.2 day of the month in which these moneys were collected, to the 134.3 county treasurer of the county where the violation occurred. 134.4 Three-eighths of these receipts shall be credited to the general 134.5 revenue fund of the county, except that in a county in a 134.6 judicial district under section 480.181, subdivision 1, 134.7 paragraph (b), this three-eighths share must be transmitted to 134.8 the state treasurer for deposit in the state treasury and 134.9 credited to the general fund. The other five-eighths of these 134.10 receipts shall be transmitted by that officer to the state 134.11 treasurer and shall be credited as follows: 134.12 (1) In the fiscal year ending June 30, 1991, the first 134.13 $275,000 in money received by the state treasurer after June 4, 134.14 1991, must be credited to the transportation services fund, and 134.15 the remainder in the fiscal year credited to the trunk highway 134.16 fund. 134.17 (2) In fiscal year 1992, the first $215,000 in money 134.18 received by the state treasurer in the fiscal year must be 134.19 credited to the transportation services fund, and the remainder 134.20 credited to the trunk highway fund. 134.21 (3) In fiscal years 1993 and subsequent years, the entire 134.22 amount received by the state treasurer must be credited to the 134.23 trunk highway fund. If, however, the violation occurs within a 134.24 municipality and the city attorney prosecutes the offense, and a 134.25 plea of not guilty is entered, one-third of the receipts shall 134.26 be credited to the general revenue fund of the county, one-third 134.27 of the receipts shall be paid to the municipality prosecuting 134.28 the offense, and one-third shall be transmitted to the state 134.29 treasurer as provided in this subdivision. All costs of 134.30 participation in a nationwide police communication system 134.31 chargeable to the state of Minnesota shall be paid from 134.32 appropriations for that purpose. 134.33 (b) Notwithstanding any other provisions of law, all fines 134.34 and forfeited bail money from violations of statutes governing 134.35 the maximum weight of motor vehicles, collected from persons 134.36 apprehended or arrested by employees of the state of Minnesota, 135.1 by means of stationary or portable scales operated by these 135.2 employees, shall be paid by the person or officer collecting the 135.3 fines or forfeited bail money, on or before the tenth day after 135.4 the last day of the month in which the collections were made, to 135.5 the county treasurer of the county where the violation 135.6 occurred. Five-eighths of These receipts shall be transmitted 135.7 by that officer to the state treasurer and shall be credited to 135.8 the highway user tax distribution fund. Three-eighths of these 135.9 receipts shall be credited to the general revenue fund of the 135.10 county, except that in a county in a judicial district under 135.11 section 480.181, subdivision 1, paragraph (a), this 135.12 three-eighths share must be transmitted to the state treasurer 135.13 for deposit in the state treasury and credited to the general 135.14 fund. 135.15 Sec. 5. Minnesota Statutes 1998, section 357.021, 135.16 subdivision 1a, is amended to read: 135.17 Subd. 1a. [TRANSMITTAL OF FEES TO STATE TREASURER.] (a) 135.18 Every person, including the state of Minnesota and all bodies 135.19 politic and corporate, who shall transact any business in the 135.20 district court, shall pay to the court administrator of said 135.21 court the sundry fees prescribed in subdivision 2. Except as 135.22 provided in paragraph (d), the court administrator shall 135.23 transmit the fees monthly to the state treasurer for deposit in 135.24 the state treasury and credit to the general fund. 135.25 (b) In a county which has a screener-collector position, 135.26 fees paid by a county pursuant to this subdivision shall be 135.27 transmitted monthly to the county treasurer, who shall apply the 135.28 fees first to reimburse the county for the amount of the salary 135.29 paid for the screener-collector position. The balance of the 135.30 fees collected shall then be forwarded to the state treasurer 135.31 for deposit in the state treasury and credited to the general 135.32 fund. In a county inthe eightha judicial district under 135.33 section 480.181, subdivision 1, paragraph (b), which has a 135.34 screener-collector position, the fees paid by a county shall be 135.35 transmitted monthly to the state treasurer for deposit in the 135.36 state treasury and credited to the general fund. A 136.1 screener-collector position for purposes of this paragraph is an 136.2 employee whose function is to increase the collection of fines 136.3 and to review the incomes of potential clients of the public 136.4 defender, in order to verify eligibility for that service. 136.5 (c) No fee is required under this section from the public 136.6 authority or the party the public authority represents in an 136.7 action for: 136.8 (1) child support enforcement or modification, medical 136.9 assistance enforcement, or establishment of parentage in the 136.10 district court, or child or medical support enforcement 136.11 conducted by an administrative law judge in an administrative 136.12 hearing under section 518.5511; 136.13 (2) civil commitment under chapter 253B; 136.14 (3) the appointment of a public conservator or public 136.15 guardian or any other action under chapters 252A and 525; 136.16 (4) wrongfully obtaining public assistance under section 136.17 256.98 or 256D.07, or recovery of overpayments of public 136.18 assistance; 136.19 (5) court relief under chapter 260; 136.20 (6) forfeiture of property under sections 169.1217 and 136.21 609.531 to 609.5317; 136.22 (7) recovery of amounts issued by political subdivisions or 136.23 public institutions under sections 246.52, 252.27, 256.045, 136.24 256.25, 256.87, 256B.042, 256B.14, 256B.15, 256B.37, and 136.25 260.251, or other sections referring to other forms of public 136.26 assistance; 136.27 (8) restitution under section 611A.04; or 136.28 (9) actions seeking monetary relief in favor of the state 136.29 pursuant to section 16D.14, subdivision 5. 136.30 (d) The fees collected for child support modifications 136.31 under subdivision 2, clause (13), must be transmitted to the 136.32 county treasurer for deposit in the county general fund. The 136.33 fees must be used by the county to pay for child support 136.34 enforcement efforts by county attorneys. 136.35 Sec. 6. Minnesota Statutes 1998, section 477A.03, 136.36 subdivision 2, is amended to read: 137.1 Subd. 2. [ANNUAL APPROPRIATION.] (a) A sum sufficient to 137.2 discharge the duties imposed by sections 477A.011 to 477A.014 is 137.3 annually appropriated from the general fund to the commissioner 137.4 of revenue. 137.5 (b) Aid payments to counties under section 477A.0121 are 137.6 limited to $20,265,000 in 1996. Aid payments to counties under 137.7 section 477A.0121 are limited to $27,571,625 in 1997. For aid 137.8 payable in 1998 and thereafter, the total aids paid under 137.9 section 477A.0121 are the amounts certified to be paid in the 137.10 previous year, adjusted for inflation as provided under 137.11 subdivision 3. 137.12 (c)(i) For aids payable in 1998 and thereafter, the total 137.13 aids paid to counties under section 477A.0122 are the amounts 137.14 certified to be paid in the previous year, adjusted for 137.15 inflation as provided under subdivision 3. 137.16 (ii) Aid payments to counties under section 477A.0122in137.172000are further increased by an additional 137.18$30,000,000$20,000,000 in20002001. 137.19 (d) Aid payments to cities in 1999 under section 477A.013, 137.20 subdivision 9, are limited to $380,565,489. For aids payable in 137.21 2000 and 2001, the total aids paid under section 477A.013, 137.22 subdivision 9, are the amounts certified to be paid in the 137.23 previous year, adjusted for inflation as provided under 137.24 subdivision 3. For aids payable in 2002, the total aids paid 137.25 under section 477A.013, subdivision 9, are the amounts certified 137.26 to be paid in the previous year, adjusted for inflation as 137.27 provided under subdivision 3, and increased by the amount 137.28 certified to be paid in 2001 under section 477A.06. For aids 137.29 payable in 2003 and thereafter, the total aids paid under 137.30 section 477A.013, subdivision 9, are the amounts certified to be 137.31 paid in the previous year, adjusted for inflation as provided 137.32 under subdivision 3. The additional amount authorized under 137.33 subdivision 4 is not included when calculating the appropriation 137.34 limits under this paragraph. 137.35 Sec. 7. Minnesota Statutes 1998, section 485.018, 137.36 subdivision 5, is amended to read: 138.1 Subd. 5. [COLLECTION OF FEES.] The court administrator of 138.2 district court shall charge and collect all fees as prescribed 138.3 by law and all such fees collected by the court administrator as 138.4 court administrator of district court shall be paid to the 138.5 county treasurer. Except for those portions of forfeited bail 138.6 paid to victims pursuant to existing law, the county treasurer 138.7 shall forward all revenue from fees and forfeited bail collected 138.8 under chapters 357, 487, and 574 to the state treasurer for 138.9 deposit in the state treasury and credit to the general fund, 138.10 unless otherwise provided in chapter 611A or other law, in the 138.11 manner and at the times prescribed by the state treasurer, but 138.12 not less often than once each month. If the defendant or 138.13 probationer is located after forfeited bail proceeds have been 138.14 forwarded to the state treasurer, the state treasurer shall 138.15 reimburse the county, on request, for actual costs expended for 138.16 extradition, transportation, or other costs necessary to return 138.17 the defendant or probationer to the jurisdiction where the bail 138.18 was posted, in an amount not more than the amount of forfeited 138.19 bail.All other money must be deposited in the county general138.20fund unless otherwise provided by law.The court administrator 138.21 of district court shall not retain any additional compensation, 138.22 per diem or other emolument for services as court administrator 138.23 of district court, but may receive and retain mileage and 138.24 expense allowances as prescribed by law. 138.25 Sec. 8. Minnesota Statutes 1998, section 487.02, 138.26 subdivision 2, is amended to read: 138.27 Subd. 2. Except as provided in this subdivision, the 138.28 county board shall levy taxes annually against the taxable 138.29 property within the county as necessary for the establishment, 138.30 operation and maintenance of the county court or courts within 138.31 the county. Any county in a judicial district under section 138.32 480.181, subdivision 1, paragraph (b) is prohibited from levying 138.33 property taxes for these purposes. 138.34 Sec. 9. Minnesota Statutes 1998, section 487.32, 138.35 subdivision 3, is amended to read: 138.36 Subd. 3. A judge of a county court may order any sums 139.1 forfeited to be reinstated and thecountystate treasurer shall 139.2 then refund accordingly. Thecountystate treasurer shall 139.3 reimburse the court administrator if the court administrator 139.4 refunds the deposit upon a judge's order and obtains a receipt 139.5 to be used as a voucher. 139.6 Sec. 10. Minnesota Statutes 1998, section 487.33, 139.7 subdivision 5, is amended to read: 139.8 Subd. 5. [ALLOCATION.] The court administrator shall 139.9 provide the county treasurer with the name of the municipality 139.10 or other subdivision of government where the offense was 139.11 committed which employed or provided by contract the arresting 139.12 or apprehending officer and the name of the municipality or 139.13 other subdivision of government which employed the prosecuting 139.14 attorney or otherwise provided for prosecution of the offense 139.15 for each fine or penalty and the total amount of fines or 139.16 penalties collected for each municipality or other subdivision 139.17 of government. On or before the last day of each month, the 139.18 county treasurer shall pay over to the treasurer of each 139.19 municipality or subdivision of government within the county all 139.20 fines or penalties for parking violations for which complaints 139.21 and warrants have not been issued and one-third of all fines or 139.22 penalties collected during the previous month for offenses 139.23 committed within the municipality or subdivision of government 139.24 from persons arrested or issued citations by officers employed 139.25 by the municipality or subdivision or provided by the 139.26 municipality or subdivision by contract. An additional 139.27 one-third of all fines or penalties shall be paid to the 139.28 municipality or subdivision of government providing prosecution 139.29 of offenses of the type for which the fine or penalty is 139.30 collected occurring within the municipality or subdivision, 139.31 imposed for violations of state statute or of an ordinance, 139.32 charter provision, rule or regulation of a city whether or not a 139.33 guilty plea is entered or bail is forfeited. Except as provided 139.34 in section 299D.03, subdivision 5, or as otherwise provided by 139.35 law, all other fines and forfeitures and all fees and statutory 139.36 court costs collected by the court administrator shall be paid 140.1 to the county treasurer of the county in which the funds were 140.2 collected who shall dispense them as provided by law. In a 140.3 county in a judicial district under section 480.181, subdivision 140.4 1, paragraph (b), all other fines, forfeitures, fees, and 140.5 statutory court costs must be paid to the state treasurer for 140.6 deposit in the state treasury and credited to the general fund. 140.7 Sec. 11. Minnesota Statutes 1998, section 574.34, 140.8 subdivision 1, is amended to read: 140.9 Subdivision 1. [GENERAL.] Fines and forfeitures not 140.10 specially granted or appropriated by law shall be paid into the 140.11 treasury of the county where they are incurred, except in a 140.12 county in a judicial district under section 480.181, subdivision 140.13 1, paragraph (b), the fines and forfeitures must be deposited in 140.14 the state treasury and credited to the general fund. 140.15 Sec. 12. [APPROPRIATION.] 140.16 $18,930,000 is appropriated for fiscal year 2001 from the 140.17 general fund to the supreme court for purposes of funding the 140.18 district court expenses under this article. 140.19 Sec. 13. [EFFECTIVE DATES; CONTINGENCY.] 140.20 (a) Sections 2 and 6 are effective for aids payable in 140.21 2000. The other provisions of this article providing for the 140.22 transfer of fees and fines to the state are effective January 1, 140.23 2000, with respect to counties in the eighth judicial district, 140.24 and July 1, 2000, with respect to counties in the fifth, 140.25 seventh, and ninth judicial districts. 140.26 (b) Notwithstanding paragraph (a), this article does not 140.27 take effect unless the state assumes the district court costs 140.28 under 1999 S.F. No. 2221, article 7. 140.29 ARTICLE 11 140.30 LOCAL ECONOMIC DEVELOPMENT 140.31 Section 1. Minnesota Statutes 1998, section 272.026, is 140.32 amended to read: 140.33 272.026 [TAX STATUS OF PROPERTY MANAGED BY A HOUSING 140.34 REDEVELOPMENT AUTHORITY OR PUBLIC HOUSING AGENCY.] 140.35 Subdivision 1. [GENERALLY.] Any property that is under the 140.36 direct management and control of, but is not owned by, a housing 141.1 redevelopment authority or public housing agency, and is used in 141.2 a manner authorized and contemplated by sections 469.001 to 141.3 469.047, and for which the authority or agency is eligible for 141.4 assistance payments under federal law, is public property used 141.5 for essential public and governmental purposes, and the property 141.6 and the authority or agency is exempt from all taxes and special 141.7 assessments of the city, the county, the state, or any political 141.8 subdivision of the state in the same manner as property referred 141.9 to in section 469.040, subdivision 1. Payments in lieu of taxes 141.10 for the property shall remain as provided in section 272.68 or 141.11 469.040, subdivision 3. 141.12 Subd. 2. [CERTAIN SOLD PROPERTY.] Any property that is 141.13 owned by a housing and redevelopment authority or a public 141.14 housing agency for at least five years and used in a manner 141.15 authorized by sections 469.001 to 469.047, which is subsequently 141.16 sold to a nonprofit corporation created under chapter 317A 141.17 subject to requirements that the property continue to be so used 141.18 and in accordance with the housing affordability restrictions 141.19 established by the housing and redevelopment authority or public 141.20 housing agency, is deemed to be public property used for 141.21 essential public and governmental purposes. If the nonprofit 141.22 owner also agrees to make service charge payments in lieu of 141.23 taxes under section 469.040, subdivision 3, the property and the 141.24 nonprofit owner are exempt from all taxes and special 141.25 assessments of the city, the county, the state, or any political 141.26 subdivision of the state in the same manner as property referred 141.27 to in section 469.040, subdivision 1. Payments in lieu of taxes 141.28 for the property shall remain as provided in section 469.040, 141.29 subdivision 3, except that they must be charged to and collected 141.30 from the nonprofit owner and do not constitute an obligation of 141.31 the authority or agency. 141.32 The nonprofit owner shall certify each year as part of the 141.33 statement of aggregate shelter rentals filed with the assessor 141.34 under section 469.040, subdivision 3, that the nonprofit 141.35 corporation is the owner of the property and continues in good 141.36 standing as a nonprofit corporation organized and operated under 142.1 chapter 317A, and that the property continues to be used in a 142.2 manner authorized by sections 469.001 to 469.047, and in 142.3 accordance with the housing affordability restrictions 142.4 established by the housing and redevelopment authority or public 142.5 housing agency. 142.6 Sec. 2. Minnesota Statutes 1998, section 273.1399, 142.7 subdivision 1, is amended to read: 142.8 Subdivision 1. [DEFINITIONS.] For purposes of this 142.9 section, the following terms have the meanings given. 142.10 (a) "Qualifying captured net tax capacity" means the 142.11 following amounts: 142.12 (1) The captured net tax capacity of a new or the expanded 142.13 part of an existing economic development tax increment financing 142.14 district, for which certification was requested after April 30, 142.15 1990. 142.16 (2) The captured net tax capacity of a new or the expanded 142.17 part of an existing tax increment financing district, other than 142.18 an economic development district, for which certification was 142.19 requested after April 30, 1990, multiplied by the following 142.20 percentage based on the number of years that have elapsed since 142.21 the assessment year of the original net tax capacity. In no 142.22 case may the final amounts be less than zero or greater than the 142.23 total captured net tax capacity of the district. 142.24 Number of Renewal and All other 142.25 years Renovation Districts 142.26 Districts 142.27 0 to 5 0 0 142.28 6 12.5 6.25 142.29 7 25 12.5 142.30 8 37.5 18.75 142.31 9 50 25 142.32 10 62.5 31.25 142.33 11 75 37.5 142.34 12 87.5 43.75 142.35 13 100 50 142.36 14 100 56.25 143.1 15 100 62.5 143.2 16 100 68.75 143.3 17 100 75 143.4 18 100 81.25 143.5 19 100 87.5 143.6 20 100 93.75 143.7 21 or more 100 100 143.8 (3) The following rules apply to a hazardous substance 143.9 subdistrict. The applicable percentage under clause (2) must be 143.10 determined under the "all other districts" category. The number 143.11 of years must be measured from the date of certification of the 143.12 subdistrict for purposes of the additional captured net tax 143.13 capacity resulting from the reduction in the subdistrict's or 143.14 site's original net tax capacity. After termination of the 143.15 overlying district, captured net tax capacity includes the full 143.16 amount that is captured by the subdistrict. 143.17 (4) Qualified captured tax capacity does not include the 143.18 captured tax capacity of exempt districts under subdivisions 6 143.19 and 7. 143.20 (b) The terms defined in section 469.174 have the meanings 143.21 given in that section. 143.22 (c) "Qualified housing district" means a housing district: 143.23 (1) for a residential rental project or projects in which 143.24 the only properties receiving assistance from revenues derived 143.25 from tax increments from the district meet all of the 143.26 requirements for a low-income housing credit under section 42 of 143.27 the Internal Revenue Code of 1986, as amended through December 143.28 31, 1992, regardless of whether the project actually receives a 143.29 low-income housing credit; or 143.30 (2) for a project in which at least 50 percent of the 143.31 housing receiving assistance from revenues derived from the 143.32 district is either: 143.33 (i) rental housing affordable to persons whose income is at 143.34 or below 50 percent of the area median income as published 143.35 annually by the United States Department of Housing and Urban 143.36 Development, and in accordance with the procedures for 144.1 determining rents under the United States Department of Housing 144.2 and Urban Development section 8 rental assistance programs for 144.3 at least 40 years beginning with the date of commencement of 144.4 construction; or 144.5 (ii) owner occupied housing initially purchased and 144.6 occupied by individuals whose family income is at or below 80 144.7 percent of the area median income as published annually by the 144.8 United States Department of Housing and Urban Development. 144.9 Sec. 3. Minnesota Statutes 1998, section 383D.41, 144.10 subdivision 1, is amended to read: 144.11 Subdivision 1. [HOUSING AND REDEVELOPMENT AUTHORITY144.12 COMMUNITY DEVELOPMENT AGENCY.] There isherebycreated in Dakota 144.13 county a public body corporate and politic, to be known as the 144.14 Dakota countyhousing and redevelopment authoritycommunity 144.15 development agency, having all of the powers and duties of a 144.16 housing and redevelopment authority under sections 469.001 to 144.17 469.047; which act applies to the county of Dakota. For the 144.18 purposes of applying the provisions ofthe municipal housing and144.19redevelopment actsections 469.001 to 469.047 and 469.090 to 144.20 469.1081 to Dakota county, and subject to the provisions of this 144.21 section, the county has all of the powers and duties of a 144.22 municipality, the county board has all of the powers and duties 144.23 of a governing body, the chair of the county board has all of 144.24 the powers and duties of a mayor, and the area of operation 144.25 includes the area within the territorial boundaries of the 144.26 county. 144.27 Sec. 4. Minnesota Statutes 1998, section 383D.41, 144.28 subdivision 2, is amended to read: 144.29 Subd. 2. This section shall not limit or restrict any 144.30 existing housing and redevelopment authority or prevent a 144.31 municipality from creating an authority.The county shall not144.32exercise jurisdiction in any municipality where a municipal144.33housing and redevelopment authority is established.A municipal 144.34 housing and redevelopment authority may request the Dakota 144.35 countyhousing and redevelopment authoritycommunity development 144.36 agency to handle the housing duties of the authorityand, in145.1such an event,. If the municipal authority makes the request, 145.2 the Dakota countyhousing and redevelopment authoritycommunity 145.3 development agency shall act and have exclusive jurisdiction for 145.4 housing in the municipality pursuant to sections 469.001 to 145.5 469.047. A transfer of duties relating to housingshalldoes 145.6 not transfer any duties relating to redevelopment. 145.7 Sec. 5. Minnesota Statutes 1998, section 383D.41, 145.8 subdivision 3, is amended to read: 145.9 Subd. 3. If any housingorproject, development district 145.10 redevelopment project, or economic development project is 145.11 constructed in Dakota county pursuant to this authorization, and 145.12suchthe project is within the boundaries of any incorporated 145.13 home rule charter or statutory city, the location ofsuchthe 145.14 projectshallmust be approved by the governing body of the 145.15 city, and: 145.16 (1) in the case of any housing project or housing 145.17 development project, by the municipal housing and redevelopment 145.18 authority established for the city if it has not previously 145.19 requested that the Dakota county community development agency or 145.20 its predecessor agency handle the housing duties of the 145.21 authority; or 145.22 (2) in the case of any redevelopment project by the 145.23 municipal housing and redevelopment authority established for 145.24 the city. 145.25 Sec. 6. Minnesota Statutes 1998, section 383D.41, is 145.26 amended by adding a subdivision to read: 145.27 Subd. 7. [DAKOTA COUNTY COMMUNITY DEVELOPMENT AGENCY.] (a) 145.28 After December 31, 1999, the Dakota county housing and 145.29 redevelopment authority shall be known as the Dakota county 145.30 community development agency. In addition to the other powers 145.31 granted in this section, the Dakota county community development 145.32 agency shall have the powers of an economic development 145.33 authority under sections 469.090 to 469.1081 that are granted to 145.34 the agency by resolution adopted by the Dakota county board of 145.35 commissioners, except as provided in paragraph (b). The agency 145.36 may exercise any of the powers granted to it under sections 146.1 469.001 to 469.047 and any of the powers of an economic 146.2 development authority granted to it by the Dakota county board 146.3 of commissioners for the purposes described in these sections. 146.4 (b) The Dakota county community development agency may not 146.5 levy the tax described in section 469.107, but with the approval 146.6 of the Dakota county board may increase its levy of the special 146.7 tax described in section 469.033, subdivision 6, to an amount 146.8 not exceeding 0.01813 percent of net tax capacity, or any higher 146.9 limit authorized under section 469.107 or 469.033, subdivision 6. 146.10 Sec. 7. Minnesota Statutes 1998, section 383D.41, is 146.11 amended by adding a subdivision to read: 146.12 Subd. 8. [OFFERS OF TAX-FORFEITED LANDS.] Notwithstanding 146.13 any other law, Dakota county may offer to the Dakota county 146.14 community development agency, under the conditions and policies 146.15 established by the county, nonconservation tax-forfeited land 146.16 prior to making the properties available to cities in Dakota 146.17 county. 146.18 Sec. 8. Minnesota Statutes 1998, section 469.169, 146.19 subdivision 12, is amended to read: 146.20 Subd. 12. [ADDITIONAL ZONE ALLOCATIONS.] (a) In addition 146.21 to tax reductions authorized in subdivisions 7, 8, 9, 10, and 146.22 11, the commissioner shall allocate tax reductions to border 146.23 city enterprise zones located on the western border of the state. 146.24 The cumulative total amount of tax reductions for all years of 146.25 the program under sections 469.1731 to 469.1735, is limited to: 146.26 (1) for the city of Breckenridge, $394,000; 146.27 (2) for the city of Dilworth, $118,200; 146.28 (3) for the city of East Grand Forks, $788,000; 146.29 (4) for the city of Moorhead, $591,000; and 146.30 (5) for the city of Ortonville, $78,800. 146.31 Allocations made under this subdivision may be used for tax 146.32 reductions provided in section 469.1732 or 469.1734 or for 146.33 reimbursements under section 469.1735, subdivision 3, but only 146.34 if the municipality determines that the granting of the tax 146.35 reduction or offset is necessary to enable a business to expand 146.36 within a city or to attract a business to a city. Limitations 147.1 on allocations under subdivision 7 do not apply to this 147.2 allocation. 147.3 (b) The limit in the allocation in paragraph (a) for a 147.4 municipality may be waived by the commissioner if the 147.5 commissioner of revenue finds that the municipality must provide 147.6 an incentive under section 469.1732 or 469.1734 that, by itself 147.7 or when aggregated with all other tax reductions granted by the 147.8 municipality under those provisions, exceeds the municipality's 147.9 maximum allocation under paragraph (a), in order to obtain or 147.10 retain a business in the city that would not occur in the 147.11 municipality without the incentive. The limit may be waived 147.12 only if the commissioner finds that the business for which the 147.13 tax incentives are to be provided: 147.14 (1) requires a private capital investment of at least 147.15 $1,000,000 within the city; 147.16 (2) employs at least 25 new or additional full-time 147.17 equivalent employees within the city; and 147.18 (3) pays its employees at the location in the city wages 147.19 that, on the average, will exceed the average wage paid in the 147.20 county in which the municipality is located. 147.21 Sec. 9. Minnesota Statutes 1998, section 469.1735, is 147.22 amended by adding a subdivision to read: 147.23 Subd. 4. [APPROPRIATION; WAIVERS.] An amount sufficient to 147.24 fund any tax reductions under a waiver made by the commissioner 147.25 under section 469.169, subdivision 12, paragraph (b), is 147.26 appropriated to the commissioner of revenue from the general 147.27 fund. This appropriation may not be deducted from the dollar 147.28 limits under this section or section 469.1734 or 469.169. 147.29 Sec. 10. Minnesota Statutes 1998, section 469.176, 147.30 subdivision 4g, is amended to read: 147.31 Subd. 4g. [GENERAL GOVERNMENT USE PROHIBITED.] (a) These 147.32 revenues shall not be used to circumvent existing levy limit 147.33 law. No revenues derived from tax increment from any district, 147.34 whether certified before or after August 1, 1979, shall be used 147.35 for the acquisition, construction, renovation, operation, or 147.36 maintenance of a building to be used primarily and regularly for 148.1 conducting the business of a municipality, county, school 148.2 district, or any other local unit of government or the state or 148.3 federal government. For any district certified after June 30, 148.4 1999, or in any geographic area added after June 30, 1999, to a 148.5 district certified before that date, tax increment revenues must 148.6 not be used for the construction or renovation of a commons area 148.7 used as a public park, or a publicly owned facility used for 148.8 social or recreational purposes. This provisionshalldoes not 148.9 prohibit the use of revenues derived from tax increments for the 148.10 construction or renovation of a parking structure, a commons148.11area used as a public park,or a facility used forsocial,148.12recreational, orconference purposesand not primarily for148.13conducting the business of the municipality. 148.14 (b) If any publicly owned facility used for social, 148.15 recreational, or conference purposes and financed in whole or in 148.16 part from revenues derived from a district is operated or 148.17 managed by an entity other than the authority, the operating and 148.18 management policies of the facility must be approved by the 148.19 governing body of the authority. 148.20 Sec. 11. Minnesota Statutes 1998, section 469.1763, is 148.21 amended by adding a subdivision to read: 148.22 Subd. 6. [POOLING PERMITTED FOR DEFICITS.] (a) This 148.23 subdivision applies only to districts for which the request for 148.24 certification was made before June 2, 1997. 148.25 (b) The municipality for the district may transfer 148.26 available increments from another tax increment financing 148.27 district located in the municipality, if the transfer is 148.28 necessary to eliminate a deficit in the district to which the 148.29 increments are transferred. A deficit in the district for 148.30 purposes of this subdivision means the lesser of the following 148.31 two amounts: 148.32 (1)(i) the amount due during the calendar year to pay 148.33 preexisting obligations of the district; minus 148.34 (ii) the total increments to be collected from properties 148.35 located within the district that are available for the calendar 148.36 year, plus 149.1 (iii) total increments from properties located in other 149.2 districts in the municipality that are available to be used to 149.3 meet the district's obligations under this section, excluding 149.4 this subdivision, or other provisions of law (but excluding a 149.5 special tax under section 469.1791 and the grant program under 149.6 Laws 1997, chapter 231, article 1, section 19); or 149.7 (2) the reduction in increments collected from properties 149.8 located in the district for the calendar year as a result of the 149.9 changes in class rates in Laws 1997, chapter 231, article 1, and 149.10 Laws 1998, chapter 389, article 2. 149.11 (c) A preexisting obligation means bonds issued and sold 149.12 before June 2, 1997, and bonds issued to refund such bonds or to 149.13 reimburse expenditures made in conjunction with a signed 149.14 contractual agreement entered into before June 2, 1997, to the 149.15 extent that the bonds are secured by a pledge of increments from 149.16 the tax increment financing district. For purposes of this 149.17 subdivision, bonds exclude an obligation to reimburse or pay a 149.18 developer or owner of property located in the district for 149.19 amounts incurred or paid by the developer or owner. 149.20 (d) The municipality may require a development authority, 149.21 other than a seaway port authority, to transfer available 149.22 increments for any of its tax increment financing districts in 149.23 the municipality to make up an insufficiency in another district 149.24 in the municipality, regardless of whether the district was 149.25 established by the development authority or another development 149.26 authority. This authority applies notwithstanding any law to 149.27 the contrary, but applies only to a development authority that: 149.28 (1) was established by the municipality; or 149.29 (2) the governing body of which is appointed, in whole or 149.30 part, by the municipality or an officer of the municipality or 149.31 which consists, in whole or part, of members of the governing 149.32 body of the municipality. 149.33 (e) The authority under this subdivision to spend tax 149.34 increments outside of the area of the district from which the 149.35 tax increments were collected: 149.36 (1) may only be exercised after obtaining approval of the 150.1 use of the increments, in writing, by the commissioner of 150.2 revenue; 150.3 (2) is an exception to the restrictions under section 150.4 469.176, subdivision 4i, and the other provisions of this 150.5 section, and the percentage restrictions under subdivision 2 150.6 must be calculated after deducting increments spent under this 150.7 subdivision from the total increments for the district; and 150.8 (3) applies notwithstanding the provisions of the tax 150.9 increment financing act in effect for districts for which the 150.10 request for certification was made before June 30, 1982, or any 150.11 other law to the contrary. 150.12 Sec. 12. Minnesota Statutes 1998, section 469.1791, 150.13 subdivision 3, is amended to read: 150.14 Subd. 3. [PRECONDITIONS TO ESTABLISH DISTRICT.] (a) A city 150.15 may establish a special taxing district within a tax increment 150.16 financing district under this section only if the conditions 150.17 under paragraphs (b) and (c) are met or if the city elects to 150.18 exercise the authority under paragraph (d). 150.19 (b) The city has determined that: 150.20 (1) total tax increments from the district, including 150.21 unspent increments from previous years and increments 150.22 transferred under paragraph (c), will be insufficient to pay the 150.23 amounts due in a year on preexisting obligations; and 150.24 (2) this insufficiency of increments resulted from the 150.25 reduction in property tax class rates enacted in the 1997 and 150.26 1998 legislative sessions. 150.27 (c) The city has agreed to transfer any available 150.28 increments from other tax increment financing districts in the 150.29 city to pay the preexisting obligations of the district under 150.30 section 469.1763, subdivision 6. This requirement does not 150.31 apply to any available increments of a qualified housing 150.32 district, as defined in section 273.1399, subdivision 150.33 1.Notwithstanding any law to the contrary, the city may150.34require a development authority to transfer available increments150.35for any of its tax increment financing districts in the city to150.36make up an insufficiency in another district in the city,151.1regardless of whether the district was established by the151.2development authority or another development authority.151.3Notwithstanding any law to the contrary, increments transferred151.4under this authority must be spent to pay preexisting151.5obligations. "Development authority" for this purpose means any151.6authority as defined in section 469.174, subdivision 2.151.7 (d) If a tax increment financing district does not qualify 151.8 under paragraphs (b) and (c), the governing body may elect to 151.9 establish a special taxing district under this section. If the 151.10 city elects to exercise this authority, increments from the tax 151.11 increment financing district and the proceeds of the tax imposed 151.12 under this section may only be used to pay preexisting 151.13 obligations and reasonable administrative expenses of the 151.14 authority for the tax increment financing district. The tax 151.15 increment financing district must be decertified when all 151.16 preexisting obligations have been paid. 151.17 Sec. 13. Minnesota Statutes 1998, section 469.1813, 151.18 subdivision 1, is amended to read: 151.19 Subdivision 1. [AUTHORITY.] The governing body of a 151.20 political subdivision may grant an abatement of the taxes 151.21 imposed by the political subdivision on a parcel of property, or 151.22 defer the payments of the taxes and abate the interest and 151.23 penalty that would otherwise be applied, if: 151.24 (a) it expects the benefits to the political subdivision of 151.25 the proposed abatement agreement to at least equal the costs to 151.26 the political subdivision of the proposed agreement; and 151.27 (b) it finds that doing so is in the public interest 151.28 because it will: 151.29 (1) increase or preserve tax base; 151.30 (2) provide employment opportunities in the political 151.31 subdivision; 151.32 (3) provide or help acquire or construct public facilities; 151.33 (4) help redevelop or renew blighted areas; or 151.34 (5) help provide access to services for residents of the 151.35 political subdivision. 151.36 Sec. 14. Minnesota Statutes 1998, section 469.1813, is 152.1 amended by adding a subdivision to read: 152.2 Subd. 1a. [USE OF TERM.] As used in this section and 152.3 sections 469.1814 and 469.1815, "abatement" includes a deferral 152.4 of taxes with abatement of interest and penalties unless the 152.5 context indicates otherwise. 152.6 Sec. 15. Minnesota Statutes 1998, section 469.1813, 152.7 subdivision 2, is amended to read: 152.8 Subd. 2. [ABATEMENT RESOLUTION.] (a) The governing body of 152.9 a political subdivision may grant an abatement only by adopting 152.10 an abatement resolution, specifying the terms of the abatement. 152.11 The resolution must also include a specific statement as to the 152.12 nature and extent of the public benefits which the governing 152.13 body expects to result from the agreement. The abatement may 152.14 reduce all or part of the property tax levied by the political 152.15 subdivision on the parcel. 152.16 (b) The political subdivision may limit the abatement: 152.17 (1) to a specific dollar amount per year or in total; 152.18 (2) to the increase in property taxes resulting from 152.19 improvement of the property; 152.20 (3) to the increases in property taxes resulting from 152.21 increases in the market value or tax capacity of the property; 152.22or152.23 (4) in any other manner the governing body of the 152.24 subdivision determines is appropriate; or 152.25 (5) to the interest and penalty that would otherwise be due 152.26 on taxes that are deferred. 152.27 (c) The political subdivision may not abate tax 152.28 attributable to the value of the land or the areawide tax under 152.29 chapter 276A or 473F. 152.30 Sec. 16. Minnesota Statutes 1998, section 469.1813, is 152.31 amended by adding a subdivision to read: 152.32 Subd. 6a. [DEFERMENT PAYMENT SCHEDULE.] When the tax is 152.33 deferred and the interest and penalty abated, the political 152.34 subdivision must set a schedule for repayments. The deferred 152.35 payment must be included with the current taxes due and payable 152.36 in the years the deferred payments are due and payable and must 153.1 be levied accordingly. 153.2 Sec. 17. Laws 1993, chapter 375, article 14, section 22, 153.3 subdivision 1, is amended to read: 153.4 Subdivision 1. [EXTENSION OF TAX INCREMENT FINANCING 153.5 DISTRICT.] Tax increment financing district No. 3-2, established 153.6 by the city of Inver Grove Heights on April 30, 1992, under Laws 153.7 1990, chapter 604, article 7, section 30, subdivision 2, 153.8 continues in effect until the earlier of (1) May 1,20042006, 153.9 or (2) when all costs provided for in the tax increment 153.10 financing plan relating to the district have been paid. In no 153.11 event may the city receive more thaneightten years of tax 153.12 increments for the districtand. All tax increments received 153.13 after May 1, 2002, and before May 1, 2004, in excess of the 153.14 amount of local government aid lost by the city under Minnesota 153.15 Statutes, section 273.1399, as a result of such tax increments, 153.16 shall be used only to pay or reimburse capital costs of public 153.17 road and bridge improvements. All tax increments received after 153.18 May 1, 2004, in excess of the amount of local government aid 153.19 lost by the city under Minnesota Statutes, section 273.1399, as 153.20 a result of the tax increments, must be used only to pay debt 153.21 service on obligations incurred before January 1, 1999, to pay 153.22 costs provided for in the tax increment financing plan, or on 153.23 obligations incurred to refinance the original obligations. 153.24 Sec. 18. Laws 1997, chapter 231, article 1, section 19, 153.25 subdivision 1, is amended to read: 153.26 Subdivision 1. [TIF GRANTS.] (a) The commissioner of 153.27 revenue shall pay grants to municipalities for deficits in tax 153.28 increment financing districts caused by the changes in class 153.29 rates under this act. Municipalities must submit applications 153.30 for the grants in a form prescribed by the commissioner by no 153.31 later thanMarchAugust 1 for grants payable during the calendar 153.32 year. The maximum grant equals the lesser of: 153.33 (1) for taxes payable in the year before the grant is paid, 153.34 the reduction in the tax increment financing district's revenues 153.35 derived from increment resulting from the class rate changes in 153.36 this article and Laws 1998, chapter 389, article 2; or 154.1 (2) the municipality's total tax increments, including 154.2 unspent increments from previous years, less the amount due 154.3 during the calendar year to pay (i) bonds issued and sold before 154.4 the day following final enactment of this act and (ii) binding 154.5 contracts entered into before the day following final enactment 154.6 of this act. 154.7 (b) The commissioner of revenue may require applicants for 154.8 grantsor pooling authorityunder this section to provide any 154.9 information the commissioner deems appropriate. The 154.10 commissioner shall calculate the amount under paragraph (a), 154.11 clause (2), based on the reports for the tax increment financing 154.12 district or districts filed with the state auditor on or before 154.13 July 1 of the year before the year in which the grant is to be 154.14 paid. 154.15 (c) This subdivision applies only to deficits in tax 154.16 increment financing districts for which: 154.17 (1) the request for certification was made before the 154.18 enactment date of this act; and 154.19 (2) all timely reports have been filed with the state 154.20 auditor, as required by Minnesota Statutes, section 469.175. 154.21 (d) The commissioner shall pay the grants under this 154.22 subdivision by December 26 of the year. 154.23 (e) $2,000,000 is appropriated to the commissioner of 154.24 revenue to make grants under this section. This appropriation 154.25 is available until expended or this section expires under 154.26 subdivision 3, whichever is earlier. If the amount of grant 154.27 entitlements for a year exceed the appropriation, the 154.28 commissioner shall reduce each grant proportionately so the 154.29 total equals the amount available. 154.30 Sec. 19. Laws 1997, chapter 231, article 1, section 19, 154.31 subdivision 3, is amended to read: 154.32 Subd. 3. [EXPIRATION.] This section expires on January 1, 154.3320012002. 154.34 Sec. 20. Laws 1997, Second Special Session chapter 2, 154.35 section 6, is amended to read: 154.36 Sec. 6. TRADE AND ECONOMIC 155.1 DEVELOPMENT 8,200,000 155.2 Notwithstanding the requirement in 155.3 Minnesota Statutes, section 469.169, 155.4 subdivision 11, as added by Laws 1997, 155.5 chapter 231, article 16, section 20, to 155.6 base allocations to zones in cities on 155.7 the state's western border on a per 155.8 capita basis, $1,200,000 is a one-time 155.9 appropriation from the general fund to 155.10 the commissioner of trade and economic 155.11 development for border city enterprise 155.12 competitiveness grants under Minnesota 155.13 Statutes, sections 469.166 to 469.173. 155.14 Funds shall be allocated to communities 155.15 with significant business losses that 155.16 are at risk of losing business tax base 155.17 due to noncompetitiveness with North 155.18 Dakota and South Dakota and shall be 155.19 available to communities for locally 155.20 administered measures to retain their 155.21 job base. Allocations made under this 155.22 paragraph may be used for tax 155.23 reductions as provided in Minnesota 155.24 Statutes, section 469.171, or other 155.25 offsets of taxes imposed on or remitted 155.26 by businesses located in the enterprise 155.27 zone, but only if the municipality 155.28 determines that the granting of the tax 155.29 reduction or offset is necessary in 155.30 order to retain a business within or 155.31 attract a business to the zone. 155.32 Limitations on allocations under 155.33 Minnesota Statutes, section 469.169, 155.34 subdivision 7, do not apply to this 155.35 appropriation. Enterprise zones that 155.36 receive allocations under this 155.37 paragraph may continue in effect for 155.38 purposes of those allocations 155.39 throughDecember 31, 1998June 30, 155.40 1999. $6,000,000 is a one-time 155.41 appropriation from the general fund to 155.42 the Minnesota investment fund for 155.43 grants to local units of government for 155.44 locally administered operating loan 155.45 programs for businesses directly and 155.46 adversely affected by the floods. Loan 155.47 criteria and requirements shall be 155.48 locally established with approval by 155.49 the department. For the purposes of 155.50 this appropriation, Minnesota Statutes, 155.51 sections 116J.8731, subdivisions 3, 4, 155.52 5, and 7, and 116J.991, are waived. 155.53 Businesses that receive grants or loans 155.54 from this appropriation shall set goals 155.55 for jobs retained and wages paid within 155.56 the area designated under Presidential 155.57 Declaration of Major Disaster, DR-1175. 155.58 $1,000,000 is a one-time appropriation 155.59 from the petroleum tank release cleanup 155.60 fund to the commissioner of trade and 155.61 economic development. Notwithstanding 155.62 Minnesota Statutes, section 115C.08, 155.63 subdivision 4, as amended by Laws 1997, 155.64 chapter 200, article 2, section 4, 155.65 these funds are to be used for grants 155.66 to buy out property substantially 155.67 damaged by a petroleum tank release. 155.68 Sec. 21. Laws 1998, chapter 389, article 11, section 29, 156.1 is amended to read: 156.2 Sec. 29. [EFFECTIVE DATE.] 156.3 Sections 1, 5, and 7 apply to tax increment financing 156.4 districts certified on, before, and after August 1, 1979. 156.5 Sections 2, 3, 4, and 8 are effective for disclosures 156.6 required to be made and reports required to be submitted 156.7 beginning in 1999. 156.8 Section 6 is effective for tax increment financing 156.9 districts for which the request for certificationiswas made 156.10 afterApril 30, 1998August 1, 1996. 156.11 Section 9 is effective the day following final enactment 156.12 and applies to tax increment financing districts certified on, 156.13 before, and after August 1, 1979. 156.14 Section 10 is effective beginning for taxes payable in 1999. 156.15 Section 11 is effective upon compliance by Itasca county 156.16 with Minnesota Statutes, section 645.021, subdivision 3. 156.17 Section 12 is effective upon compliance by Koochiching 156.18 county with Minnesota Statutes, section 645.021, subdivision 3. 156.19 Sec. 22. [AUTHORIZATION; AIRPORT IMPACT ZONES.] 156.20 Subdivision 1. [CITY OF RICHFIELD; DESIGNATION.] (a) There 156.21 is established within the city of Richfield an airport impact 156.22 zone consisting of the real property described as follows: 156.23 Commencing at the intersection of the north city limits 156.24 with the w'ly ROW line of T.H. 77, thence south along the w'ly 156.25 ROW line of T.H. 77 to the n'ly ROW line of Interstate Highway 156.26 494, thence west along the n'ly ROW line of Interstate Highway 156.27 494 to the center line of Bloomington Avenue, thence north on 156.28 the center line of Bloomington Avenue to the n'ly ROW line of E. 156.29 77th St., thence east along the n'ly ROW line of E. 77th St. to 156.30 a point 133.2' east of the e'ly ROW line of Bloomington Avenue, 156.31 thence north on a line parallel with and 133.2' east of the e'ly 156.32 ROW line of Bloomington Avenue to the north city limits, thence 156.33 east along the north city limits to the point of beginning. 156.34 (b) The city of Richfield may add area to the airport 156.35 impact zone designated under this subdivision, or establish one 156.36 or more additional airport impact zones, subject to the terms 157.1 and conditions of subdivision 2. 157.2 Subd. 2. [CITIES OF BLOOMINGTON, MINNEAPOLIS, AND EAGAN; 157.3 DESIGNATION; CRITERIA.] (a) Each of the cities of Bloomington, 157.4 Minneapolis, and Eagan may designate one or more airport impact 157.5 zones within their respective boundaries. An airport impact 157.6 zone is a discrete geographic area that meets criteria for such 157.7 a zone established by the metropolitan council. The criteria 157.8 established by the metropolitan council for an airport impact 157.9 zone must: 157.10 (1) be based upon airport impacts found by the council 157.11 after study to be present in the airport impact zone designated 157.12 for the city of Richfield under subdivision 1; and 157.13 (2) be such that any area within any of the cities 157.14 experiencing land use incompatibility substantially similar to 157.15 the area described in subdivision 1, would qualify for 157.16 designation as an airport impact zone. 157.17 (b) A city that intends to establish an airport impact zone 157.18 must prepare and submit to the metropolitan council for approval 157.19 a plan identifying the geographic boundaries of the proposed 157.20 zone and the airport mitigation measures to be undertaken in the 157.21 zone. 157.22 Subd. 3. [AIRPORT IMPACTS DEFINED.] The legislature finds 157.23 that: 157.24 (a) The area included within the airport impact zones 157.25 defined under this section will experience significant adverse 157.26 environmental and socioeconomic impacts associated with the 157.27 operation of the Minneapolis-St. Paul international airport; 157.28 (b) Whether funded directly by the metropolitan airports 157.29 commission or by other means, expenditures for mitigation of 157.30 those airport-created impacts involve an aspect of the airport's 157.31 capital and operating expenses and will be made for airport 157.32 purposes; and 157.33 (c) Appropriate measures to mitigate those adverse impacts 157.34 include, but are not limited to, housing replacement activities. 157.35 Sec. 23. [AIRPORT TAX INCREMENT FINANCING DISTRICTS.] 157.36 Subdivision 1. [RICHFIELD.] (a) The city of Richfield may 158.1 establish an airport impact tax increment financing district 158.2 consisting of the real property within the airport impact zone 158.3 established under section 22, subdivision 1. The tax increment 158.4 financing district is subject to the provisions of subdivision 3. 158.5 (b) If the city of Richfield receives approval for an 158.6 expanded or new airport impact zone under section 22, the city 158.7 may establish an airport impact tax increment financing district 158.8 within that expanded or new zone, subject to the terms and 158.9 conditions of subdivision 2. 158.10 Subd. 2. [BLOOMINGTON, MINNEAPOLIS, AND EAGAN.] (a) Each 158.11 of the cities of Bloomington, Minneapolis, and Eagan may 158.12 establish an airport impact tax increment financing district and 158.13 project within an approved airport impact zone. The district is 158.14 subject to the provisions of subdivision 3. The district may be 158.15 established only if the metropolitan council approves: 158.16 (1) the boundaries of the district; 158.17 (2) the tax increment financing plan for the district; and 158.18 (3) the number of authorized phases of the district. 158.19 Subd. 3. [SPECIAL RULES.] (a) Each district established 158.20 under subdivisions 1 and 2 is considered a redevelopment 158.21 district and project and is subject to Minnesota Statutes, 158.22 sections 469.174 to 469.179, except as otherwise provided in 158.23 this subdivision. 158.24 (1) For the purposes of Minnesota Statutes, section 158.25 469.1763, subdivision 2, the "in-district percentage" is 100 158.26 percent, except to the extent otherwise provided in clause (4), 158.27 and except that administrative expenses are considered 158.28 activities in the district. Minnesota Statutes, section 158.29 469.1763, subdivision 3, does not apply to the district. 158.30 (2) Except as otherwise provided in subdivision 2, the tax 158.31 increment financing plan for the district may identify up to six 158.32 phases, each consisting of a contiguous or noncontiguous 158.33 geographic area within the district. Tax increment must not be 158.34 paid to the authority from any phase after 25 years from the 158.35 date of receipt by the authority of the first tax increment from 158.36 that phase. 159.1 (3) Minnesota Statutes, section 469.176, subdivision 4j, 159.2 does not apply to the district. 159.3 (4) Minnesota Statutes, sections 273.1399 and 469.1782, 159.4 subdivision 1, do not apply to the district if the authority 159.5 elects either or both of the following: 159.6 (i) the exemption under Minnesota Statutes, section 159.7 273.1399, subdivision 6, paragraph (d); or 159.8 (ii) at least 15 percent of the revenue generated from tax 159.9 increment from the district in any year is deposited in the 159.10 housing replacement account of the authority and spent according 159.11 to the tax increment financing plan. 159.12 (b) The authority must identify in the tax increment 159.13 financing plan the housing replacement activities to be assisted 159.14 by the housing replacement account. 159.15 (c) A city or any authority for that city as defined in 159.16 Minnesota Statutes, section 469.174, subdivision 2, may be the 159.17 "authority" under Minnesota Statutes, sections 469.174 to 159.18 469.179, for the purposes of sections 22 to 25. 159.19 (d) Housing replacement activities may include 159.20 rehabilitation, acquisition, demolition, relocation assistance, 159.21 relocation of existing single-family or multifamily housing, and 159.22 financing of new or existing single-family or multifamily 159.23 housing that replaces housing units eliminated by redevelopment 159.24 within the district. 159.25 (e) Housing replacement activities listed in the plan need 159.26 not be located within the district, project area, or airport 159.27 impact zone. 159.28 Sec. 24. [METROPOLITAN AIRPORTS COMMISSION LOCAL SALES 159.29 TAX.] 159.30 Subdivision 1. [SALES TAX AUTHORIZED.] (a) Notwithstanding 159.31 Minnesota Statutes, section 477A.016, or other law, the 159.32 metropolitan airports commission may impose by resolution a 159.33 sales tax of up to four percent upon airport sales for the 159.34 purposes specified in subdivision 2. The provisions of 159.35 Minnesota Statutes, section 297A.48, govern the imposition, 159.36 administration, collection, and enforcement of the tax 160.1 authorized under this section, except: 160.2 (1) the tax is imposed only on airport sales as defined in 160.3 this section; and 160.4 (2) Minnesota Statutes, section 297A.48, subdivisions 4 and 160.5 9a, do not apply. 160.6 (b) For purposes of this section, the term "airport sales" 160.7 means sales that are taxable under Minnesota Statutes, chapter 160.8 297A, and occur on property owned by the metropolitan airports 160.9 commission at the Minneapolis-St. Paul international airport, 160.10 including without limitation, parking, vehicle rental, food and 160.11 beverage, vending, merchandise, and pay telephones. Airport 160.12 sales do not include sales of goods or taxable services 160.13 purchased by the metropolitan airports commission or by persons 160.14 or entities conducting a private trade or business on property 160.15 owned by the metropolitan airports commission at the 160.16 Minneapolis-St. Paul international airport. 160.17 Subd. 2. [USE OF REVENUES.] (a) Revenues received from 160.18 taxes authorized by subdivision 1 must be used by the 160.19 metropolitan airports commission to pay the cost of collecting 160.20 the taxes and for the following purposes: 160.21 (1) to pay principal of, interest on, and redemption 160.22 premium, if any, on obligations issued by the cities of 160.23 Bloomington, Minneapolis, Richfield, and Eagan, or any of those 160.24 cities, under section 25; or 160.25 (2) to pay the costs of any approved airport mitigation 160.26 measures conducting by the cities of Bloomington, Minneapolis, 160.27 Richfield, and Eagan, or any of those cities. 160.28 (b) For the purposes of this section, "approved airport 160.29 mitigation measure" means any action taken by a city to mitigate 160.30 the impacts of airport expansion that are included in an airport 160.31 impact mitigation plan approved by the metropolitan council for 160.32 an airport impact zone in that city. 160.33 Subd. 3. [PAYMENT PROVISIONS.] (a) The chief 160.34 administrative officer of a city issuing obligations or 160.35 conducting approved airport mitigation measures pursuant to this 160.36 section or section 25 must, before June 1 in each year during 161.1 which the local sales tax authorized by this section is in 161.2 effect, certify to the metropolitan airports commission: 161.3 (1) the aggregate amount of obligations issued by the city 161.4 under section 25 that are secured in whole or in part by local 161.5 sales tax revenue; 161.6 (2) the amount of principal of and interest on the 161.7 obligations described in clause (1) payable in the next calendar 161.8 year; 161.9 (3) the amount of net tax increment received by the city or 161.10 the authority in the current calendar year, where the term "net 161.11 tax increment" means the tax increment generated from the 161.12 district to which the activities financed by the obligations 161.13 described in clause (1) relate, less the amount of principal and 161.14 interest payable in the next calendar year on obligations issued 161.15 by the city under section 25 and secured in whole or in part by 161.16 tax increments from that district but not secured by local sales 161.17 tax revenues; 161.18 (4) the amount by which the required payments of principal 161.19 and interest on the obligations described in clause (1) exceeds 161.20 the net tax increment received; and 161.21 (5) the amount of expenditures made by the city or the 161.22 authority (other than from proceeds of obligations) for approved 161.23 airport mitigation measures in the last calendar year. 161.24 (b) The metropolitan airports commission must then issue a 161.25 warrant to the city making the certification in the amounts 161.26 certified payable to the financial officer of that city under 161.27 paragraph (a), clauses (4) and (5), subject to subdivision 4. 161.28 The amounts received by the city representing principal and 161.29 interest on obligations must be deposited in the debt service 161.30 fund from which the obligations are payable. The amount 161.31 representing the costs of approved airport mitigation measures 161.32 may be spent by the city or authority only in accordance with 161.33 the approved airport mitigation plan. 161.34 (c) In each year during which the local sales tax is in 161.35 effect: 161.36 (i) for each city in which no obligations secured by local 162.1 sales tax revenues are outstanding and no certification is made 162.2 under paragraph (a), clause (5), the metropolitan airports 162.3 commission must impose the tax at a rate that is one percent 162.4 less than the maximum four percent tax allowed under subdivision 162.5 1. 162.6 (ii) for each city in which obligations secured by local 162.7 sales tax are outstanding, 25 percent of the revenues collected 162.8 in that year net of collection costs is to be retained by the 162.9 metropolitan airports commission for the purposes described in 162.10 this section. 162.11 Subd. 4. [PRIORITY OF PAYMENTS.] Payments from the 162.12 revenues collected under subdivision 3 are to be made: 162.13 (1) first, prorated based upon the aggregate principal of 162.14 obligations outstanding to the cities of Bloomington, 162.15 Minneapolis, Richfield, and Eagan for the payment of principal 162.16 of, interest on, and redemption premium, if any, on obligations 162.17 issued under section 25; and 162.18 (2) second, prorated based upon the aggregate amount of 162.19 mitigation certifications in each fiscal year to the cities of 162.20 Bloomington, Minneapolis, Richfield, and Eagan for the costs of 162.21 approved airport mitigation measures. 162.22 Subd. 5. [COMMENCEMENT AND TERMINATION OF TAXES.] (a) The 162.23 local sales tax imposed under this section commences upon the 162.24 earlier of: 162.25 (1) notification by the city of Richfield to the 162.26 metropolitan airports commission of its intent to issue 162.27 obligations secured by local sales tax revenues under this 162.28 section; or 162.29 (2) approval by the metropolitan council of an airport 162.30 impact mitigation plan for any of the cities of Bloomington, 162.31 Minneapolis, Richfield, or Eagan; in either case subject to 162.32 compliance with Minnesota Statutes, section 297A.48, subdivision 162.33 9. 162.34 (b) The local sales tax imposed under this section 162.35 terminates on the earlier of: 162.36 (1) the date by which all of the cities of Bloomington, 163.1 Minneapolis, Richfield, and Eagan have notified the metropolitan 163.2 airports commission that all obligations issued under section 28 163.3 secured by local sales tax revenues have been paid or defeased, 163.4 and the cost of all approved airport mitigation measures have 163.5 been paid; or 163.6 (2) after 25 full calendar years of collection, excluding 163.7 the first year if the tax is imposed for only a portion of that 163.8 year. 163.9 (c) If the conditions for commencement of the local sales 163.10 tax under subdivision 5, paragraph (a), have not been met by 163.11 January 1, 2006, no local sales tax may be imposed under this 163.12 section. 163.13 (d) The balance of any local sales tax revenues held by the 163.14 metropolitan airports commission upon termination of the tax and 163.15 the payment of all amounts due under this section must be 163.16 transmitted to the commissioner of revenue for deposit in the 163.17 state general fund. 163.18 Sec. 25. [BONDS; SECURITY.] 163.19 Subdivision 1. [RICHFIELD.] The city of Richfield may 163.20 issue and sell its general obligations, and may pledge to the 163.21 payment of those obligations the revenues described in section 163.22 24, subdivision 3, to finance the costs of land and structure 163.23 acquisition, demolition, relocation, site clearance, and public 163.24 improvements within an airport impact zone established under 163.25 section 22, and the cost of any approved airport mitigation 163.26 measures undertaken within or related to any airport impact 163.27 zone, including without limitation any housing replacement 163.28 activities as defined in section 23. 163.29 Subd. 2. [BLOOMINGTON, MINNEAPOLIS, AND EAGAN.] Each of 163.30 the cities of Bloomington, Minneapolis, and Eagan may issue and 163.31 sell its general obligations, and may pledge to the payment of 163.32 those obligations the revenues described in section 24, 163.33 subdivision 3, to finance the cost of approved airport 163.34 mitigation measures undertaken within or related to an airport 163.35 impact zone, including without limitation any housing 163.36 replacement activities as defined in section 23. 164.1 Subd. 3. [TERMS.] Obligations issued under this section 164.2 must be issued in accordance with Minnesota Statutes, chapter 164.3 475, and may be secured by tax increments subject to clause (4), 164.4 local sales tax revenues under section 24, any other revenues 164.5 available to the city, or any combination of such revenues. 164.6 Notwithstanding any other law or charter provision: 164.7 (1) each city may issue obligations secured by local sales 164.8 tax revenues in an aggregate principal amount not to exceed 164.9 $30,000,000 (after deducting costs of issuance, discount, and 164.10 capitalized interest); 164.11 (2) the pledge of local sales tax revenues to obligations 164.12 issued by any city under this section is on a parity of lien 164.13 with the pledge of such revenues to obligations issued by any 164.14 other city under this section; 164.15 (3) voter approval is not required and net debt limits do 164.16 not apply to obligations issued under this section; 164.17 (4) obligations secured in whole or in part with tax 164.18 increments must be issued in accordance with Minnesota Statutes, 164.19 section 469.178; and 164.20 (5) a city may issue obligations to refund any obligations 164.21 issued under this section, the principal amount of which is not 164.22 included in computing the limits on amount of obligations 164.23 issuable by the city under this section. 164.24 Subd. 4. [METROPOLITAN COUNCIL PLEDGE.] The metropolitan 164.25 council may by resolution pledge the full faith and credit and 164.26 taxing power of the metropolitan council to pay principal of and 164.27 interest on obligations issued by the city of Bloomington, the 164.28 city of Minneapolis, the city of Richfield, or the city of Eagan 164.29 or their respective authorities under sections 22 to 25. The 164.30 pledge must be made in accordance with Minnesota Statutes, 164.31 chapter 475, but voter approval is not required and net debt 164.32 limits do not apply. Taxes levied by the metropolitan council 164.33 by reason of the pledge: 164.34 (1) do not affect the amount or rate of taxes that may be 164.35 levied by council for other purposes; 164.36 (2) must be spread against all taxable property in the 165.1 metropolitan area; and 165.2 (3) are not subject to limit as to rate or amount. 165.3 Subd. 5. [OBLIGATION DEFINED.] In sections 22 to 25, 165.4 "obligation" has the meaning given it in Minnesota Statutes, 165.5 section 475.51, subdivision 3. The term includes obligations 165.6 issued to refund prior obligations issued under sections 22 to 165.7 25. 165.8 Sec. 26. [CITY OF BROOKLYN CENTER; TAX INCREMENT FINANCING 165.9 DISTRICT.] 165.10 Subdivision 1. [CHANGE OF FISCAL DISPARITIES 165.11 ELECTION.] Notwithstanding Minnesota Statutes, section 469.177, 165.12 subdivision 3, paragraph (c), the governing body of the city of 165.13 Brooklyn Center may change its election of the computation of 165.14 tax increment for tax increment district No. 4 under Minnesota 165.15 Statutes, section 469.177, subdivision 3, from the method of 165.16 computation in paragraph (b) to the method in paragraph (a) of 165.17 that provision. 165.18 Subd. 2. [EFFECTIVE DATE.] This section is effective upon 165.19 approval by the governing body of the city of Brooklyn Center 165.20 and compliance with Minnesota Statutes, section 645.021, 165.21 subdivision 3. 165.22 Sec. 27. [CITY OF COLUMBIA HEIGHTS; TAX INCREMENT 165.23 FINANCING.] 165.24 Subdivision 1. [EXTENSION OF TAX INCREMENT FINANCING 165.25 DISTRICT.] The governing body of the city of Columbia Heights 165.26 may extend the duration of tax increment financing district No. 165.27 N7 (53rd Avenue) in the city of Columbia Heights for a period 165.28 not to exceed four years. Minnesota Statutes, section 469.1782, 165.29 subdivision 1, does not apply to the extension of the district 165.30 under this section. 165.31 Subd. 2. [LIMITATIONS.] Tax increments attributable to the 165.32 duration extension in subdivision 1 must be used solely to pay 165.33 the principal of and interest on any outstanding obligations, 165.34 after application of the amounts authorized to be spent under 165.35 subdivision 3, or to repay amounts paid for those purposes by 165.36 the city or its economic development authority from other 166.1 revenues. 166.2 Subd. 3. [POOLING PERMITTED.] Notwithstanding any other 166.3 law to the contrary, tax increments from any tax increment 166.4 financing district in the city may be used to pay the principal 166.5 of and interest on outstanding obligations, the proceeds of 166.6 which were used to finance activities located outside the 166.7 boundaries of the district. The amount authorized under this 166.8 subdivision to be spent outside the district is limited to an 166.9 amount necessary to make payments on outstanding obligations 166.10 after application of tax increments originally pledged to pay 166.11 the outstanding obligations. 166.12 Subd. 4. [OUTSTANDING OBLIGATIONS; DEFINITION.] For the 166.13 purposes of this section, "outstanding obligations" means any 166.14 general obligation bonds issued before January 1, 1999, by the 166.15 city of Columbia Heights or any development authority controlled 166.16 by that city, that were secured in whole or in part with tax 166.17 increments from any tax increment financing district in the 166.18 city, and any bonds issued to refund those bonds. 166.19 Subd. 5. [LOCAL APPROVAL.] This section is effective upon 166.20 approval by the governing body of the city of Columbia Heights 166.21 and compliance with Minnesota Statutes, sections 469.1782, 166.22 subdivision 2, and 645.021, subdivision 3. 166.23 Sec. 28. [CITY OF DAWSON; TAX INCREMENT DISTRICT.] 166.24 Subdivision 1. [DISTRICT EXTENDED.] Notwithstanding 166.25 Minnesota Statutes, section 469.176, subdivision 1b, the Dawson 166.26 economic development authority may collect tax increments from 166.27 tax increment financing district No. 7 for a period of 20 years 166.28 after receipt by the authority of the first increment. 166.29 Subd. 2. [EFFECTIVE DATE; APPLICABILITY.] Subdivision 1 is 166.30 effective upon compliance with Minnesota Statutes, sections 166.31 469.1782, subdivision 2, and 645.021, subdivision 3. Minnesota 166.32 Statutes, section 469.1782, subdivision 1, does not apply to the 166.33 district. 166.34 Sec. 29. [CITY OF FRIDLEY; TAX INCREMENT FINANCING 166.35 DISTRICT.] 166.36 Subdivision 1. [EXTENSION OF TIME.] Notwithstanding 167.1 Minnesota Statutes, section 469.176, subdivision 1b, upon 167.2 approval of the governing body of the city of Fridley, the 167.3 Fridley housing and redevelopment authority may, by resolution, 167.4 extend the duration of tax increment financing district No. 6 167.5 located in the city of Fridley. The housing and redevelopment 167.6 authority may not extend the duration beyond December 31, 2025. 167.7 The provisions of Minnesota Statutes, sections 273.1399, 167.8 subdivision 8, and 469.1782, subdivision 1, do not apply to this 167.9 district if extended. 167.10 Subd. 2. [EFFECTIVE DATE.] This section is effective upon 167.11 approval by the governing body of the city of Fridley and 167.12 compliance with Minnesota Statutes, section 645.021, subdivision 167.13 3. 167.14 Sec. 30. [CITY OF GARRISON; LOCAL CONTRIBUTION RATIFIED.] 167.15 Subdivision 1. [AUTHORIZATION.] Notwithstanding the 167.16 provisions of Laws 1995, chapter 264, article 5, section 49, the 167.17 provisions of Minnesota Statutes, section 273.1399, subdivision 167.18 6, paragraph (d), apply to tax increment financing district No. 167.19 1 in the city of Garrison, and the contribution of land made by 167.20 the city with respect to that district prior to January 1, 1999, 167.21 is considered an election to make a qualifying local 167.22 contribution. 167.23 Subd. 2. [EFFECTIVE DATE.] This section is effective upon 167.24 approval by the governing body of the city of Garrison and 167.25 compliance with the requirements of Minnesota Statutes, section 167.26 645.021. 167.27 Sec. 31. [ITASCA COUNTY; TAX INCREMENT FINANCING 167.28 DISTRICT.] 167.29 Subdivision 1. [AUTHORIZATION.] The governing body of the 167.30 county of Itasca may create an economic development tax 167.31 increment financing district, as provided in this section, on 167.32 one or more parcels to contain an electric power plant and which 167.33 are adjacent to a taconite mine direct reduction plant and steel 167.34 mill. Except as otherwise provided in this section, the 167.35 provisions of Minnesota Statutes, sections 469.174 to 469.179, 167.36 apply to the district. 168.1 Subd. 2. [SPECIAL RULES.] (a) The duration of the district 168.2 established under this section is 25 years from the receipt of 168.3 the first increment, notwithstanding Minnesota Statutes, section 168.4 469.176, subdivision 1b. 168.5 (b) Notwithstanding Minnesota Statutes, section 469.1763, 168.6 tax increment from the district established under section 1 may 168.7 be expended on improvements and activities in aid of the 168.8 electric power plant and the direct reduction plant and steel 168.9 mill and related administrative expenses, but may not otherwise 168.10 be expended outside the district. 168.11 (c) Minnesota Statutes, section 469.1782, subdivision 1, 168.12 does not apply to this section or the district established under 168.13 this section. 168.14 (d) Minnesota Statutes, section 273.1399, does not apply to 168.15 the district. 168.16 (e) The captured net tax capacity of the district 168.17 established under this section includes any property taxed as 168.18 personal property having a situs in the district. 168.19 Subd. 3. [DEVELOPMENT POWERS.] The county may exercise all 168.20 of the powers of a housing and redevelopment authority under 168.21 Minnesota Statutes, sections 469.001 to 469.047, and the powers 168.22 of an economic development authority under Minnesota Statutes, 168.23 sections 469.090 to 469.108, in connection with the development 168.24 of the project described in this section. 168.25 Subd. 4. [EFFECTIVE DATE.] This section is effective upon 168.26 approval by the Itasca county board and compliance with 168.27 Minnesota Statutes, section 645.021, subdivision 3. 168.28 Sec. 32. [CITY OF MEDFORD; ECONOMIC DEVELOPMENT DISTRICT.] 168.29 Subdivision 1. [SIZE OF COMMERCIAL 168.30 FACILITIES.] Notwithstanding any other law to the contrary, the 168.31 city of Medford may use revenues derived from tax increment from 168.32 an economic development district located within the city to 168.33 provide assistance to one or more separately owned commercial 168.34 facilities, each consisting of 30,000 square feet or less. 168.35 Except as otherwise provided in this section, the revenues 168.36 derived from increments must be spent as required under 169.1 Minnesota Statutes, section 469.176, section 4c. 169.2 Subd. 2. [EFFECTIVE DATE; APPLICABILITY.] This section is 169.3 effective upon approval by the governing body of the city of 169.4 Medford and compliance with Minnesota Statutes, section 645.021, 169.5 subdivision 3, and applies to requests for certification of tax 169.6 increment financing districts or additions of new area to tax 169.7 increment financing districts after the day of final enactment. 169.8 Sec. 33. [CITY OF MINNEOTA; TAX INCREMENT FINANCING 169.9 EXPENDITURES.] 169.10 Subdivision 1. [ACTIONS RATIFIED.] The expenditure of tax 169.11 increments on administrative expenses and public utility or 169.12 other improvements by the city of Minneota for its tax increment 169.13 financing district, adopted by city resolution 4-15-85A, are 169.14 ratified and deemed to be authorized by the tax increment 169.15 financing plan for the district. 169.16 Subd. 2. [EFFECTIVE DATE.] This section is effective upon 169.17 compliance by the governing body of the city of Minneota with 169.18 Minnesota Statutes, section 645.021, subdivision 3. 169.19 Sec. 34. [CITY OF MOUNTAIN IRON; ECONOMIC DEVELOPMENT TAX 169.20 INCREMENT FINANCING DISTRICT.] 169.21 Subdivision 1. [AUTHORIZATION.] The Mountain Iron housing 169.22 and redevelopment authority in and for the city of Mountain Iron 169.23 may establish one economic development tax increment financing 169.24 district in the city of Mountain Iron for a commercial facility 169.25 of unlimited size. 169.26 Subd. 2. [SPECIAL RULES.] The tax increment financing 169.27 district authorized in subdivision 1 is subject to Minnesota 169.28 Statutes, sections 469.174 to 469.179, with the exception listed 169.29 in this section. Notwithstanding Minnesota Statutes, section 169.30 469.176, subdivision 4c, paragraph (c), revenues derived from 169.31 tax increment from an economic development district may be used 169.32 to provide improvements, loan subsidies, or assistance in any 169.33 form for any separately owned commercial facility of any size 169.34 located within the municipal jurisdiction of Mountain Iron, a 169.35 small city as defined in Minnesota Statutes, section 469.174, 169.36 subdivision 27. 170.1 Subd. 3. [EFFECTIVE DATE; LOCAL APPROVAL.] 170.2 This section is effective upon approval by the governing 170.3 body of the city of Mountain Iron under Minnesota Statutes, 170.4 section 645.021, subdivision 2. 170.5 Sec. 35. [CITY OF NISSWA; EXTENDING DURATION OF TAX 170.6 INCREMENT FINANCING DISTRICT.] 170.7 Subdivision 1. [AUTHORIZATION.] Notwithstanding Minnesota 170.8 Statutes, section 469.176, subdivision 1b, if the city of Nisswa 170.9 does not receive sufficient funding from other sources to make 170.10 improvements to its wastewater system as required by the 170.11 pollution control agency, tax increment may be paid until 170.12 December 31, 2014, for tax increment financing district No. 1-2 170.13 in the city of Nisswa. Tax increments received after April 4, 170.14 2000, must be used only for the cost of the wastewater system. 170.15 Subd. 2. [EFFECTIVE DATE.] This section is effective upon 170.16 approval by the governing body of the city of Nisswa and 170.17 compliance with Minnesota Statutes, sections 469.1782 and 170.18 645.021, subdivision 3. 170.19 Sec. 36. [CITY OF ONAMIA; USE OF TAX INCREMENT FINANCING.] 170.20 Subdivision 1. [APPLICATION OF TIME LIMIT.] For tax 170.21 increment financing district No. 1-1, established April 14, 170.22 1993, by the city of Onamia, Minnesota Statutes, section 170.23 469.1763, subdivision 3, applies to the qualified portion of the 170.24 district by permitting a period of ten years for commencement of 170.25 activities within the district. As used in this section, 170.26 "qualified portion of the district" means only that portion of 170.27 the district consisting of three parcels fronting on U.S. 169. 170.28 Subd. 2. [EFFECTIVE DATE.] This section is effective upon 170.29 approval by the governing body of the city of Onamia and 170.30 compliance with Minnesota Statutes, section 645.021, subdivision 170.31 3. 170.32 Sec. 37. [TAX INCREMENT DISTRICT POOLING; ST. CLOUD 170.33 HOUSING AND REDEVELOPMENT AUTHORITY.] 170.34 Subdivision 1. [AUTHORIZATION.] Notwithstanding Minnesota 170.35 Statutes, section 469.1763, subdivision 2, and the provisions of 170.36 the tax increment financing act in effect for districts 171.1 established by the St. Cloud housing and redevelopment authority 171.2 for which the request for certification was made after August 1, 171.3 1979, and before June 30, 1982, revenue derived from tax 171.4 increments paid by properties in the districts may be expended 171.5 through a development fund or otherwise to finance the 171.6 redevelopment of commercial properties outside of tax increment 171.7 financing districts which were destroyed or damaged in a natural 171.8 gas explosion on December 11, 1998. 171.9 Subd. 2. [EFFECTIVE DATE.] Subdivision 1 is effective upon 171.10 compliance by the governing body of the St. Cloud housing and 171.11 redevelopment authority with Minnesota Statutes, section 171.12 645.021, subdivision 3. 171.13 Sec. 38. [CITY OF ST. PAUL; DELAY OF DEEMED COMMENCEMENT 171.14 OF TAX INCREMENT FINANCING DISTRICT.] 171.15 Subdivision 1. [AUTHORIZATION.] Notwithstanding Minnesota 171.16 Statutes, section 469.176, or any other law to the contrary, the 171.17 duration limit of the Williams Hill tax increment district in 171.18 the city of St. Paul is determined as if the date of receipt of 171.19 the first tax increment by the authority occurs when the 171.20 aggregate of all tax increments received from the district 171.21 reaches $2,000. 171.22 Subd. 2. [EFFECTIVE DATE.] Subdivision 1 is effective upon 171.23 approval by the governing body of the city of St. Paul and 171.24 compliance with Minnesota Statutes, section 645.021, subdivision 171.25 3. 171.26 Sec. 39. [CITY OF WOODBURY LEVY AUTHORITY.] 171.27 Subdivision 1. [AUTHORIZATION.] Notwithstanding any other 171.28 law to the contrary, the city of Woodbury may levy a tax not to 171.29 exceed the amount provided in subdivision 2 on properties 171.30 defined in subdivision 3. The levy is not subject to any 171.31 current or future limitation on the amount or tax rate other 171.32 than the limitation provided in subdivision 2. 171.33 Subd. 2. [ESTABLISHMENT OF TAXING DISTRICT.] If the 171.34 governing body of the city of Woodbury elects not to impose the 171.35 tax under this section on all commercial-industrial properties 171.36 in the city, it may establish a district within which the tax 172.1 will be imposed. A district established under this section must 172.2 consist of an area within which is located business enterprises 172.3 that the governing body finds will be served by the improvements 172.4 described in subdivision 6. The governing body may exclude from 172.5 the taxing district any area in which is located a business 172.6 enterprise that, in the opinion of the governing body, has made 172.7 a substantial contribution or a binding commitment to make a 172.8 substantial contribution to the cost of the improvements 172.9 described in subdivision 6. 172.10 Subd. 3. [LIMITATION.] The levy authorized in subdivision 172.11 1 must not exceed the product of: 172.12 (1) the positive difference, if any, between the areawide 172.13 tax rate under Minnesota Statutes, section 473F.08, subdivision 172.14 5, and the local tax rate under Minnesota Statutes, section 172.15 473F.08, subdivision 4; and 172.16 (2) the portion of the net tax capacity of the properties 172.17 defined in subdivision 4 that is not subject to the areawide tax 172.18 rate under Minnesota Statutes, section 473F.08, subdivision 6. 172.19 Determination of the limitation under this subdivision 172.20 shall be made for each unique taxing jurisdiction, as defined 172.21 under Minnesota Statutes, section 273.1398, subdivision 1, 172.22 within the city. 172.23 Subd. 4. [PROPERTIES SUBJECT TO TAX.] The properties 172.24 subject to tax under this section are commercial-industrial 172.25 properties as defined under Minnesota Statutes, section 473F.02, 172.26 subdivision 3. The net tax capacity of commercial-industrial 172.27 properties subject to tax under this section does not include 172.28 that portion of the net tax capacity subject to the areawide tax 172.29 rate under Minnesota Statutes, section 473F.08, subdivision 6. 172.30 Subd. 5. [RELATION TO TAX INCREMENT FINANCING AND FISCAL 172.31 DISPARITIES.] The levy under this section is not included in 172.32 computations under Minnesota Statutes, section 469.177 or 172.33 Minnesota Statutes, chapter 473F. 172.34 Subd. 6. [USE OF PROCEEDS.] The proceeds of the tax levied 172.35 under this section must be used only for the construction of a 172.36 highway interchange at the intersection of I-494 and Tamarack 173.1 Road and for road and bridge improvements on the portion of the 173.2 roads connecting to and immediately adjacent to the interchange 173.3 that are required as the result of the construction of the 173.4 interchange. 173.5 Subd. 7. [SUNSET.] The tax under this section expires in 173.6 the year immediately following the later of the year in which: 173.7 (1) the improvements described in subdivision 6 are paid 173.8 for; or 173.9 (2) any bonds issued to pay for the cost of those 173.10 improvements are defeased. 173.11 Subd. 8. [BONDS AUTHORIZED.] The city of Woodbury may 173.12 issue general obligations to provide funding for the activities 173.13 described in subdivision 6. The obligations must be issued 173.14 under Minnesota Statutes, chapter 475, except that no referendum 173.15 is required under Minnesota Statutes, section 475.58. 173.16 Subd. 9. [EFFECTIVE DATE.] Upon compliance by the 173.17 governing body of the city of Woodbury with Minnesota Statutes, 173.18 section 645.021, subdivision 3, this section is effective for 173.19 taxes levied in 1999, payable in 2000, and thereafter. 173.20 Sec. 40. [COST ESTIMATES.] 173.21 Any waiver granted under Minnesota Statutes, section 173.22 469.169, subdivision 12, paragraph (b), must be reported within 173.23 60 days to the commissioner of finance and the chairs of the 173.24 house and senate tax committees. 173.25 Sec. 41. [INSTRUCTION TO THE REVISOR.] 173.26 In the 2000 edition of Minnesota Statutes, the revisor of 173.27 statutes shall change "Dakota county housing and redevelopment 173.28 authority" to "Dakota county community development agency" 173.29 wherever it appears. 173.30 Sec. 42. [REPEALER.] 173.31 Laws 1997, chapter 231, article 1, section 19, subdivision 173.32 2, is repealed. 173.33 Sec. 43. [EFFECTIVE DATES.] 173.34 (a) Section 2 is effective for districts for which requests 173.35 for certification were received on or after September 2, 1998. 173.36 (b) Sections 8, 9, 11, 12, 18, 20, 21, and 40 are effective 174.1 the day following final enactment. 174.2 (c) Section 17 is effective upon approval by the governing 174.3 body of the city of Inver Grove Heights, and compliance with 174.4 Minnesota Statutes, section 645.021, subdivision 3. 174.5 (d) Sections 22 to 25 are effective as to each of the 174.6 cities of Bloomington, Minneapolis, Richfield, or Eagan upon 174.7 approval by the governing body of the respective city and 174.8 compliance by its chief clerical officer with Minnesota 174.9 Statutes, section 645.021, subdivision 3; and with regard to 174.10 section 23, upon similar compliance with Minnesota Statutes, 174.11 section 469.1782, subdivision 2. 174.12 ARTICLE 12 174.13 TAX DELINQUENCY AND FORFEITURE PROCEDURES 174.14 Section 1. Minnesota Statutes 1998, section 92.51, is 174.15 amended to read: 174.16 92.51 [TAXATION; REDEMPTION; SPECIAL CERTIFICATE.] 174.17 State lands sold by the director become taxable. A 174.18 description of the tract sold, with the name of the purchaser, 174.19 must be transmitted to the proper county auditor. The auditor 174.20 must extend the land for taxation like other land. Only the 174.21 interest in the land vested by the land sale certificate in its 174.22 holder may be sold for delinquent taxes.Upon production to the174.23county treasurer of the tax certificate given upon tax sale, in174.24case the lands have not been redeemed, the tax purchaser has the174.25right to pay the principal and interest then in default upon the174.26land sale certificate as its assignee. To redeem from a tax174.27sale, the person redeeming must pay the county treasurer, for174.28the holder and owner of the tax sale certificate, in addition to174.29all sums required to be paid in other cases, all amounts paid by174.30the holder and owner for interest and principal upon the land174.31sale certificate, with interest at 12 percent per year. When174.32the director receives the tax certificate with the county174.33auditor's certificate of the expiration of the time for174.34redemption, and the county treasurer's receipt for all174.35delinquent interest and penalty on the land sale certificate,174.36the director shall issue the holder and owner of the tax175.1certificate a special certificate with the same terms and the175.2same effect as the original land sale certificate.175.3 Sec. 2. Minnesota Statutes 1998, section 279.37, 175.4 subdivision 1, is amended to read: 175.5 Subdivision 1. [COMPOSITION INTO ONE ITEM.] Delinquent 175.6 taxes upon any parcel of real estate may be composed into one 175.7 item or amount by confession of judgment at any time prior to 175.8 the forfeiture of the parcel of land to the state for taxes, for 175.9 the aggregate amount of all the taxes, costs, penalties, and 175.10 interest accrued against the parcel, ashereinafterprovided in 175.11 this section. Taxes upon property which, for the previous 175.12 year's assessment, was classified as mineral property, 175.13 employment property, or commercial or industrial propertyshall175.14 are onlybeeligible to be composed into any confession of 175.15 judgment under this section as provided in subdivision 175.16 1a. Delinquent taxes for property that has been reclassified 175.17 from 4bb to 4b under section 273.1319 may not be composed into a 175.18 confession of judgment under this subdivision. Delinquent taxes 175.19 on unimproved land are eligible to be composed into a confession 175.20 of judgment only if the land is classified as homestead, 175.21 agricultural, or timberland in the previous year or is eligible 175.22 for installment payment under subdivision 1a. The entire parcel 175.23 is eligible for the ten-year installment plan as provided in 175.24 subdivision 2 if 25 percent or more of the market value of the 175.25 parcel is eligible for confession of judgment under this 175.26 subdivision. 175.27 Sec. 3. Minnesota Statutes 1998, section 279.37, 175.28 subdivision 1a, is amended to read: 175.29 Subd. 1a. [CLASS 3A PROPERTY.] (a) The delinquent taxes 175.30 upon a parcel of property which was classified class 3a, for the 175.31 previous year's assessment and had a total market value ofless175.32than$200,000 or less for that same assessment shall be eligible 175.33 to be composed into a confession of judgment. Property 175.34 qualifying under this subdivision shall be subject to the same 175.35 provisions as provided in this section except ashereinprovided 175.36 in paragraphs (b) to (d). 176.1(a)(b) Current year taxes and penalty due at the time the 176.2 confession of judgment is entered must be paid. 176.3 (c) The down paymentshallmust include all special 176.4 assessments due in the current tax year, all delinquent special 176.5 assessments, and 20 percent of the ad valorem tax, penalties, 176.6 and interest accrued against the parcel. The balance 176.7 remainingshall beis payable in four equal annual installments; 176.8 and 176.9(b)(d) The amounts entered in judgmentshallbear interest 176.10 at the rate provided in section 279.03, subdivision 1a, 176.11 commencing with the date the judgment is entered. The interest 176.12 rate is subject to change each year on the unpaid balance in the 176.13 manner provided in section 279.03, subdivision 1a. 176.14 Sec. 4. Minnesota Statutes 1998, section 279.37, 176.15 subdivision 2, is amended to read: 176.16 Subd. 2. [INSTALLMENT PAYMENTS.] The owner of any such 176.17 parcel, or any person to whom the right to pay taxes has been 176.18 given by statute, mortgage, or other agreement, may make and 176.19 file with the county auditor of the countywhereinin which the 176.20 parcel is located a written offer to pay the current taxes each 176.21 year before they become delinquent, or to contest the taxes 176.22 under Minnesota Statutes 1941, sections 278.01 to 278.13, and 176.23 agree to confess judgment for the amounthereinbeforeprovided, 176.24 as determined by the county auditor, and shall thereby waive. 176.25 By filing the offer, the owner waives all irregularities in 176.26 connection with the tax proceedings affecting the parcel and any 176.27 defense or objection which the owner may have to the 176.28 proceedings, andshall thereby waivealso waives the 176.29 requirements of any notice of default in the payment of any 176.30 installment or interest to become due pursuant to the composite 176.31 judgment to be so entered, and shall tender therewith. With the 176.32 offer, the owner shall tender one-tenth of the amount of the 176.33 delinquent taxes, costs, penalty, and interest, and shall tender 176.34 all current year taxes and penalty due at the time the 176.35 confession of judgment is entered. In the offer, the owner 176.36 shall agreethereinto pay the balance in nine equal 177.1 installments, with interest as provided in section 279.03, 177.2 payable annually on installments remaining unpaid from time to 177.3 time, on or before December 31 of each year following the year 177.4 in which judgment was confessed, which. The offershallmust be 177.5 substantially as follows: 177.6 "To the court administrator of the district court of 177.7 ........... county, I, ....................., am the owner of 177.8 the following described parcel of real estatesituatelocated in 177.9 .................... county, Minnesota, to-wit: 177.10 .............................. Uponwhichthat real estate there 177.11 are delinquent taxes for the year ........., and prior years, as 177.12 follows: (here insert year of delinquency and the total amount 177.13 of delinquent taxes, costs, interest, and penalty)do hereby. 177.14 By signing this document I offer to confess judgment in the sum 177.15 of $...... andherebywaive all irregularities in the tax 177.16 proceedings affectingsuchthese taxes and any defense or 177.17 objection which I may havetheretoto them, and direct judgment 177.18 to be entered for theamount hereby confessedamount stated 177.19 above,lessminus the sum of $............,hereby tenderedto 177.20 be paid with this document,beingwhich is one-tenth of the 177.21 amount ofsaidthe taxes, costs, penalty, and interest;stated 177.22 above. I agree to pay the balance ofsaidthe judgment in nine 177.23 equal, annual installments, with interest as provided in section 177.24 279.03, payable annually, on the installments remaining 177.25 unpaidfrom time to time, said. I agree to pay the installments 177.26 and interestto be paidon or before December 31 of each year 177.27 following the year in which this judgment is confessed and 177.28 current taxes each year before they become delinquent, or within 177.29 30 days after the entry of final judgment in proceedings to 177.30 contestsuchthe taxes under Minnesota Statutes1941, sections 177.31 278.01 to 278.13. 177.32 Datedthis.............., ......." 177.33 Sec. 5. Minnesota Statutes 1998, section 281.23, 177.34 subdivision 2, is amended to read: 177.35 Subd. 2. [MAY COVER PARCELS BID IN AT SAME TAX SALEFORM.] 177.36All parcels of land bid in at the same tax judgment sale and178.1having the same period of redemption shall be covered by a178.2single posted notice, but a separate notice may be posted for178.3any parcel which may be omitted. SuchThe notice of expiration 178.4 of redemption must contain the tax parcel identification numbers 178.5 and legal descriptions of parcels subject to notice of 178.6 expiration of redemption provisions prescribed under subdivision 178.7 1. The notice must also indicate the names of taxpayers and fee 178.8 owners of record in the office of the county auditor at the time 178.9 the notice is prepared and names of those parties who have filed 178.10 their addresses according to section 276.041 and the amount of 178.11 payment necessary to redeem as of the date of the notice. At 178.12 the option of the county auditor, the current filed addresses of 178.13 affected persons may be included on the notice. The notice 178.14shall beis sufficient if substantially in the following form: 178.15 "NOTICE OF EXPIRATION OF REDEMPTION 178.16 Office of the County Auditor 178.17 County of ......................., State of Minnesota. 178.18 To all personsinterestedhaving an interest inthelands 178.19hereinafterdescribed in this notice: 178.20 You areherebynotified that the parcels of land 178.21hereinafterdescribed, situatedin this notice and located in 178.22 the county of ................................, state of 178.23 Minnesota,were bid in for the state on the178.24......................... day of .......................,178.25......., at the tax judgment sale of land for delinquent taxes178.26for the year .......; that the legal descriptions and tax parcel178.27identification numbers of such parcels and names of the178.28taxpayers and fee owners and in addition those parties who have178.29filed their addresses pursuant to section 276.041, and the178.30amount necessary to redeem as of the date hereof and, at the178.31election of the county auditor, the current filed addresses of178.32any such persons, are as follows:are subject to forfeiture to 178.33 the state of Minnesota because of nonpayment of delinquent 178.34 property taxes, special assessments, penalties, interest, and 178.35 costs levied on those parcels. The time for redemption from 178.36 forfeiture expires if a redemption is not made by the later of 179.1 (1) 60 days after service of this notice on all persons having 179.2 an interest in the lands of record at the office of the county 179.3 recorder or registrar of titles or (2) the second Monday in 179.4 May. The redemption must be made in my office. 179.5 Names (and 179.6 Current Filed 179.7 Addresses) for 179.8 the Taxpayers 179.9 and Fee Owners 179.10 andin Addition179.11 Those Parties 179.12 Who Have Filed Amount 179.13 Their Addresses Tax Necessary to 179.14 Pursuant to Legal Parcel Redeem as of 179.15 section 276.041 Description Number DateHereof179.16 of Notice 179.17 ................ ........... ...... ............ 179.18 ................ ........... ...... ............ 179.19That the time for redemption of such lands from such sale179.20will expire 60 days after service of notice and the filing of179.21proof thereof in my office, as provided by law. The redemption179.22must be made in my office.179.23 FAILURE TO REDEEMSUCHTHE LANDS PRIOR TO THE EXPIRATION 179.24 OF REDEMPTION WILL RESULT IN THE LOSS OF THE LAND AND 179.25 FORFEITUREOF SAID LANDTO THE STATE OF MINNESOTA. 179.26 Inquiries as tothethese proceedingsset forth abovecan 179.27 be made to the County Auditor forthe............... Countyof179.28..............., whose address is set forth below. 179.29 Witness my hand and official seal this 179.30 ............................ day of ................, ....... 179.31 ......................... 179.32 County Auditor 179.33 (OFFICIAL SEAL) 179.34 ......................... 179.35 (Address) 179.36 ......................... 180.1 (Telephone)." 180.2SuchThe noticeshallmust be posted by the auditor in the 180.3 auditor's office, subject to public inspection, andshallmust 180.4 remain so posted until at least one week after the date of the 180.5 last publication of notice, ashereinafterprovided in this 180.6 section. Proof ofsuchpostingshallmust be made by the 180.7 certificate of the auditor, filed in the auditor's office. 180.8 Sec. 6. Minnesota Statutes 1998, section 281.23, 180.9 subdivision 4, is amended to read: 180.10 Subd. 4. [PROOF OF PUBLICATION.] An affidavit establishing 180.11 proof of publication ofsuchthe notice affidavit, as provided 180.12 by law,shallmust be filed in the office of the county 180.13 auditor. A single published noticeshall be sufficient for all180.14 may include parcels of land bid in atthe samedifferent tax 180.15 judgmentsalesales,having the same periodbut included parcels 180.16 must have a common year for expiration of redemption, and180.17covered by a notice or notices kept posted during the time of180.18the publication, as hereinbefore provided. 180.19 Sec. 7. Minnesota Statutes 1998, section 281.23, 180.20 subdivision 6, is amended to read: 180.21 Subd. 6. [SERVICE OF NOTICE.] (a)ForthwithImmediately 180.22 after the commencement ofsuchpublication or mailing the county 180.23 auditor shall deliver to the sheriff of the county or any other 180.24 person not less than 18 years of age a sufficient number of 180.25 copies ofsuchthe notice of expiration of redemption for 180.26 serviceuponon the persons in possession of all parcels of such 180.27 landas areactually occupied, and documentation if the 180.28 certified mail notice was returned as undeliverable or the 180.29 notice was not mailed to the address associated with the 180.30 property. Within 30 days after receiptthereofof the notice, 180.31 the sheriff or other person serving the notice shallmake such180.32investigationinvestigate asmay benecessary to ascertain 180.33 whether or not the parcels covered bysuchthe notice are 180.34 actually occupied parcels, and shall serve a copy ofsuchthe 180.35 notice of expiration of redemption upon the person in possession 180.36 of each parcel found to be an occupied parcel, in the manner 181.1 prescribed for serving summons in a civil action. If the 181.2 sheriff or another person serving the notice has made at least 181.3 two attempts to serve the notice of expiration of redemption, 181.4 one between the weekday hours of 8:00 a.m. and 5:00 p.m. and the 181.5 other on a different day and different time period, the sheriff 181.6 or another person serving the notice may accomplish this service 181.7 by posting a copy of the notice of expiration of redemption on a 181.8 conspicuous location on the parcel. The sheriff or other person 181.9 serving the notice shall make prompt return to the auditor as to 181.10 all notices so served and as to all parcels found vacant and 181.11 unoccupied and parcels served by posting.SuchThe returnshall181.12 must be madeuponon a copy ofsuchthe notice andshall be181.13 is prima facie evidence of the factsthereinstated in it. 181.14 If the notice is served by the sheriff, the sheriff shall 181.15 receive from the county, in addition to other compensation 181.16 prescribed by law,suchfees and mileage for service on persons 181.17 in possession asareprescribed by law for such service in other 181.18 cases, and shall also receivesuchcompensation for making 181.19 investigation and return as to vacant and unoccupied lands as 181.20 the county board may fix, subject to appeal to the district 181.21 court as in case of other claims against the county. As to 181.22 either service upon persons in possession or return as to vacant 181.23 lands, the sheriff shall charge mileage only for one trip if the 181.24 occupants of more than two tracts are served simultaneously, and 181.25 in such case mileageshallmust be prorated and charged 181.26 equitably against all such owners. 181.27 (b) The secretary of state shall receive sheriff's service 181.28 for all out-of-state interests. 181.29 Sec. 8. Minnesota Statutes 1998, section 282.01, 181.30 subdivision 1, is amended to read: 181.31 Subdivision 1. [CLASSIFICATION AS CONSERVATION OR 181.32 NONCONSERVATION.] It is the general policy of this state to 181.33 encourage the best use of tax-forfeited lands, recognizing that 181.34 some lands in public ownership should be retained and managed 181.35 for public benefits while other lands should be returned to 181.36 private ownership. Parcels of land becoming the property of the 182.1 state in trust under law declaring the forfeiture of lands to 182.2 the state for taxesshallmust be classified by the county board 182.3 of the county in which the parcels lie as conservation or 182.4 nonconservation. In making the classification the board shall 182.5 consider the present use of adjacent lands, the productivity of 182.6 the soil, the character of forest or other growth, accessibility 182.7 of lands to established roads, schools, and other public 182.8 services, their peculiar suitability or desirability for 182.9 particular uses and the suitability of the forest resources on 182.10 the land for multiple use, sustained yield management. The 182.11 classification, furthermore, must encourage and foster a mode of 182.12 land utilization that will facilitate the economical and 182.13 adequate provision of transportation, roads, water supply, 182.14 drainage, sanitation, education, and recreation; facilitate 182.15 reduction of governmental expenditures; conserve and develop the 182.16 natural resources; and foster and develop agriculture and other 182.17 industries in the districts and places best suited to them. 182.18 In making the classification the county board may use 182.19 information made available by any office or department of the 182.20 federal, state, or local governments, or by any other person or 182.21 agency possessing pertinent information at the time the 182.22 classification is made. The lands may be reclassified from time 182.23 to time as the county boardmay considerconsiders necessary or 182.24 desirable, except for conservation lands held by the state free 182.25 from any trust in favor of any taxing district. 182.26 If the lands are located within the boundaries of an 182.27 organized town, with taxable valuation in excess of $20,000, or 182.28 incorporated municipality, the classification or 182.29 reclassification and sale must first be approved by the town 182.30 board of the town or the governing body of the municipality in 182.31 which the lands are located. The town board of the town or the 182.32 governing body of the municipality is considered to have 182.33 approved the classification or reclassification and sale if the 182.34 county board is not notified of the disapproval of the 182.35 classification or reclassification and sale within9060 days of 182.36 the date the request for approval was transmitted to the town 183.1 board of the town or governing body of the municipality. If the 183.2 town board or governing body desires to acquire any parcel lying 183.3 in the town or municipality by procedures authorized in this 183.4 section, it must file a written application with the county 183.5 board to withhold the parcel from public sale. The application 183.6 must be filed within9060 days of the request for 183.7 classification or reclassification and sale. The county board 183.8 shall then withhold the parcel from public sale forone yearsix 183.9 months. A municipality or governmental subdivision pay 183.10 maintenance costs incurred by the county during the six-month 183.11 period while the property is withheld from public sale, provided 183.12 the property is not offered for public sale after the six-month 183.13 period. A clerical error made by county officials does not 183.14 serve to eliminate the request of the town board or governing 183.15 body if the board or governing body has forwarded the 183.16 application to the county auditor. 183.17 Sec. 9. Minnesota Statutes 1998, section 282.01, 183.18 subdivision 4, is amended to read: 183.19 Subd. 4. [SALE: METHOD, REQUIREMENTS, EFFECTS.] The sale 183.20shallmust be conducted by the county auditor at the county seat 183.21 of the county in which the parcels lie,providedexcept that,in 183.22 St. Louis and Koochiching counties, the sale may be conducted in 183.23 any county facility within the county, and. The parcelsshall183.24 must be sold for cash only and at not less than the appraised 183.25 value, unless the county board of the countyshall havehas 183.26 adopted a resolution providing for their sale on terms, in which 183.27 event the resolutionshall controlcontrols with respectthereto183.28 to the sale. When the sale is made on terms other than for cash 183.29 only (1) a payment of at least ten percent of the purchase price 183.30 must be made at the time of purchase,thereuponand the balance 183.31shallmust be paid in no more than ten equal annual 183.32 installments, or (2) the payments must be made in accordance 183.33 with county board policy, but in no event may the board require 183.34 more than 12 installments annually, and the contract term must 183.35 not be for more than ten years.NoStanding timber or timber 183.36 productsshallmust not be removed from these lands until an 184.1 amount equal to the appraised value of all standing timber or 184.2 timber products on the lands at the time of purchase has been 184.3 paid by the purchaser; provided, that in case any. If a parcel 184.4 of land bearing standing timber or timber products is sold at 184.5 public auction for more than the appraised value, the amount bid 184.6 in excess of the appraised valueshallmust be allocated between 184.7 the land and the timber in proportion tothetheir respective 184.8 appraised valuesthereof, and no. In that case, standing timber 184.9 or timber productsshallmust not be removed from the land until 184.10 the amount of the excess bid allocated to timber or timber 184.11 products has been paid in addition to the appraised 184.12 valuethereofof the land. The purchaser is entitled to 184.13 immediate possession, subject to the provisions of any existing 184.14 valid lease made in behalf of the state. 184.15 For sales occurring on or after July 1, 1982, the unpaid 184.16 balance of the purchase price is subject to interest at the rate 184.17 determined pursuant to section 549.09. The unpaid balance of 184.18 the purchase price for sales occurring after December 31, 1990, 184.19 is subject to interest at the rate determined in section 279.03, 184.20 subdivision 1a. The interest rate is subject to change each 184.21 year on the unpaid balance in the manner provided for rate 184.22 changes in section 549.09 or 279.03, subdivision 1a, whichever, 184.23 is applicable. Interest on the unpaid contract balance on sales 184.24 occurring before July 1, 1982, is payable at the rate applicable 184.25 to the sale at the time that the sale occurred. 184.26 Sec. 10. Minnesota Statutes 1998, section 282.01, 184.27 subdivision 7, is amended to read: 184.28 Subd. 7. [COUNTY SALES; NOTICE, PURCHASE PRICE, 184.29 DISPOSITION.] The saleherein provided for shallmust commence 184.30 atsuchthe timeasdetermined by the county board of the county 184.31wherein suchin which the parcelslie, shall directare 184.32 located. The county auditor shall offer the parcels of land in 184.33 order in which they appear in the notice of sale, and shall sell 184.34 them to the highest bidder, but not for alesssum less than the 184.35 appraised value, until all of the parcels of landshallhave 184.36 been offered, and thereafter. Then the county auditor shall 185.1 sell any remaining parcels to anyone offering to pay the 185.2 appraised valuethereof, except that if the person could have 185.3 repurchased a parcel of property under section 282.012 or 185.4 282.241, that personshall not be allowed tomay not purchase 185.5 that same parcel of property at the sale under this subdivision 185.6 for a purchase price less than the sum of alldelinquenttaxes 185.7and, assessments, penalties, interest, and costs due at the time 185.8 of forfeiture computed under section 282.251,together with185.9penalties, interest, and costs that accrued or would have185.10accrued if the parcel had not forfeited to the stateand any 185.11 special assessments for improvements certified as of the date of 185.12 sale.SaidThe saleshallmust continue until allsuch185.13 the parcels are sold or until the county boardshall order185.14 orders a reappraisal orshall withdrawwithdraws any or allsuch185.15 of the parcels from sale.SuchThe list of lands may be added 185.16 to and the added lands may be sold at any time by publishing the 185.17 descriptions and appraised valuesof such. The added lands must 185.18 be: (1) parcels of landas shallthat have become forfeited and 185.19 classified as nonconservation since the commencement of any 185.20 prior saleor such; (2) parcelsas shallthat have been 185.21 reappraised, or such; (3) parcelsas shallthat have been 185.22 reclassified as nonconservation; orsuch(4) other parcelsas185.23 that are subject to sale but were omitted from the existing list 185.24 for any reason. The descriptions and appraised values must be 185.25 published in the same manner ashereinafterprovided for the 185.26 publication of the original list, provided that any. Parcels 185.27 added tosuchthe listshallmust first be offered for sale to 185.28 the highest bidder before they are sold at appraised value. All 185.29 parcels of land not offered for immediate sale, as well as 185.30 parcelsof such lands asthat are offered and not immediately 185.31 soldshall, continue to be held in trust by the state for the 185.32 taxing districts interested in each ofsaidthe parcels, under 185.33 the supervision of the county board, and such. Those parcels 185.34 may be used for public purposes until sold, as directed by the 185.35 county boardmay direct. 185.36 Sec. 11. Minnesota Statutes 1998, section 282.04, 186.1 subdivision 2, is amended to read: 186.2 Subd. 2. [RIGHTS BEFORE SALE; IMPROVEMENTS, INSURANCE, 186.3 DEMOLITION.]Until afterBefore the sale of a parcel of 186.4 forfeited land the county auditor may, with the approval of the 186.5 county board of commissioners, provide for the repair and 186.6 improvement of any building or structure located uponsuchthe 186.7 parcel, and may provide for maintenance of tax-forfeited lands, 186.8 if it is determined by the county board that such repairsor, 186.9 improvements, or maintenance are necessary for the operation, 186.10 use, preservation and safetythereof; and,of the building or 186.11 structure. If so authorized by the county board, the county 186.12 auditor may insureany suchthe building or structure against 186.13 loss or damage resulting from fire or windstorm, may purchase 186.14 workers' compensation insurance to insure the county against 186.15 claims for injury to the personsthereinemployed in the 186.16 building or structure by the county, and may insure the county, 186.17 its officers and employees against claims for injuries to 186.18 persons or property because of the management, use or operation 186.19 ofsuchthe building or structure.SuchThe county auditor may, 186.20 with the approval of the county board, provide for the 186.21 demolition ofany suchthe building or structure, which has been 186.22 determined by the county board to be within the purview of 186.23 section 299F.10, and for the sale of salvaged 186.24 materialstherefromfrom the building or structure.SuchThe 186.25 county auditor, with the approval of the county board, may 186.26 provide for the sale of abandoned personal property under either 186.27 chapter 345 or 566, as appropriate. The net proceeds from any 186.28 sale ofsuchthe personal property, salvaged materials,of186.29 timber or other products, or leases made under this lawshall186.30 must be deposited in the forfeited tax sale fund andshallmust 186.31 be distributed in the same manner as if the parcel had been sold. 186.32SuchThe county auditor, with the approval of the county 186.33 board, may provide for the demolition of any structureor186.34structureson tax-forfeited lands, if in the opinion of the 186.35 county board, the county auditor, and the land commissioner, if 186.36 therebeis one, the sale ofsuchthe land withsuchthe 187.1 structureor structures thereonon it, or the continued 187.2 existence ofsuchthe structureor structuresby reason of age, 187.3 dilapidated condition or excessive size as compared with nearby 187.4 structures, will result in a material lessening of net tax 187.5 capacities of real estate in the vicinity ofsuchthe 187.6 tax-forfeited lands, or if the demolition ofsuchthe structure 187.7 or structures will aid in disposing ofsuchthe tax-forfeited 187.8 property. 187.9 Before the sale of a parcel of forfeited land located in an 187.10 urban area, the county auditor may with the approval of the 187.11 county board provide for the gradingthereofof the land by 187.12 filling or the removal of any surplus materialtherefrom, and187.13wherefrom it. If the physical condition of forfeited lands is 187.14 such that a reasonable gradingthereofof the lands is necessary 187.15 for the protection and preservation of the property of any 187.16 adjoining owner,suchthe adjoining property owner or owners may 187.17make applicationapply to the county board to havesuchthe 187.18 grading done. If, after consideringsaidthe application, the 187.19 county board believes thatsuchthe grading will enhance the 187.20 value ofsuchthe forfeited lands commensurate with the cost 187.21 involved, it may approvethe sameit, andany suchthe work 187.22shallmust be performed under the supervision of the county or 187.23 city engineer, as the case may be, and the expensethereofpaid 187.24 from the forfeited tax sale fund. 187.25 Sec. 12. Minnesota Statutes 1998, section 282.08, is 187.26 amended to read: 187.27 282.08 [APPORTIONMENT OF PROCEEDS TO TAXING DISTRICTS.] 187.28 The net proceeds from the sale or rental of any parcel of 187.29 forfeited land, or from the sale ofanyproductstherefromfrom 187.30 the forfeited land,shallmust be apportioned by the county 187.31 auditor to the taxing districts interestedthereinin the land, 187.32 as follows: 187.33 (1)Suchthe portionas may berequired to pay any amounts 187.34 included in the appraised value under section 282.01, 187.35 subdivision 3, as representing increased value due to any public 187.36 improvement made after forfeiture ofsuchthe parcel to the 188.1 state, but not exceeding the amount certified by the clerk of 188.2 the municipality, shallmust be apportioned to the municipal 188.3 subdivision entitledtheretoto it; 188.4 (2)Suchthe portionas may berequired to pay any amount 188.5 included in the appraised value under section 282.019, 188.6 subdivision 5, representing increased value due to response 188.7 actions taken after forfeiture ofsuchthe parcel to the state, 188.8 but not exceeding the amount of expenses certified by the 188.9 pollution control agency or the commissioner of 188.10 agriculture,shallmust be apportioned to the agency or the 188.11 commissioner of agriculture and deposited in the fund from which 188.12 the expenses were paid; 188.13 (3)Suchthe portion of the remainderas may berequired to 188.14 discharge any special assessment chargeable againstsuchthe 188.15 parcel for drainage or other purpose whether due or deferred at 188.16 the time of forfeiture,shallmust be apportioned to the 188.17 municipal subdivision entitledtheretoto it; and 188.18 (4) any balanceshallmust be apportioned as follows: 188.19(a) Any(i) The county board may annually by resolution set 188.20 aside no more than 30 percent of the receipts remaining to be 188.21 used for timber development on tax-forfeited land and dedicated 188.22 memorial forests, to be expended under the supervision of the 188.23 county board. Itshallmust be expended only on projects 188.24 approved by the commissioner of natural resources. 188.25(b) Any(ii) The county board may annually by resolution 188.26 set aside no more than 20 percent of the receipts remaining to 188.27 be used for the acquisition and maintenance of county parks or 188.28 recreational areas as defined in sections 398.31 to 398.36, to 188.29 be expended under the supervision of the county board. 188.30(c) If the board does not avail itself of the authority188.31under paragraph (a) or (b)(iii) Any balance remainingshall188.32 must be apportioned as follows: county, 40 percent; town or 188.33 city, 20 percent; and school district, 40 percent,and if the188.34board avails itself of the authority under paragraph (a) or (b)188.35the balance remaining shall be apportioned among the county,188.36town or city, and school district in the proportions in this189.1paragraph above stated,provided, however, that in unorganized 189.2 territory that portion whichshouldwould have accrued to the 189.3 townshipshallmust be administered by the county board of 189.4 commissioners. 189.5 Sec. 13. Minnesota Statutes 1998, section 282.09, is 189.6 amended to read: 189.7 282.09 [FORFEITED TAX SALE FUND.] 189.8 Subdivision 1. [MONEY PLACED IN FUND; FEES AND 189.9 DISBURSEMENTS.] The county auditor and county treasurer shall 189.10 place all money received through the operation of sections 189.11 282.01 to 282.13 in a fund to be known as the forfeited tax sale 189.12 fund, and all disbursements and costsshallmust be charged 189.13 against that fund, when allowed by the county board. Members of 189.14 the county board may be paid a per diem pursuant to section 189.15 375.055, subdivision 1, and reimbursed for their necessary 189.16 expenses, and may receive mileage as fixed by law. The amount 189.17 of compensation of a land commissioner and assistants, if a land 189.18 commissioner is appointed,shallmust bein the amount189.19 determined by the county board. The county auditorshallmust 189.20 receive 50 cents for each certificate of sale, each contract for 189.21 deed and each lease executed by the auditor, and, in counties 189.22 where no land commissioner is appointed, additional annual 189.23 compensation, not exceeding $300, as fixed by the county board. 189.24 The amount of compensation of any other clerical helpthat may189.25beneeded by the county auditor or land commissionershallmust 189.26 bein the amountdetermined by the county board. All 189.27 compensation provided forherein shall bein this subdivision is 189.28 in addition to other compensation allowed by law. Fees so 189.29 charged in addition to the fee imposed in section 282.014shall189.30 must be included in the annual settlement by the county auditor 189.31 as hereinafter provided. On or before February 1 each year, the 189.32 commissioner of revenue shall certify to the commissioner of 189.33 finance, by counties, the total number of state deeds issued and 189.34 reissued during the preceding calendar year for which such fees 189.35 are charged and the total amountthereofof fees. On or before 189.36 March 1 each year, each county shall remit to the commissioner 190.1 of revenue, from the forfeited tax sale fund, the aggregate 190.2 amount of the fees imposed by section 282.014 in the preceding 190.3 calendar year. The commissioner of revenue shall deposit the 190.4 amounts received in the state treasury to the credit of the 190.5 general fund. When disbursements are made from the fund for 190.6 repairs, refunds, expenses of actions to quiet title, or any 190.7 other purpose which particularly affects specific parcels of 190.8 forfeited lands, the amount ofsuchthe disbursementsshallmust 190.9 be charged to theaccount of the taxing districts interested in190.10such parcelsforfeited tax sale fund. The county auditor shall 190.11 make an annual settlement of the net proceeds received from 190.12 sales and rentals by the operation of sections 282.01 to 282.13, 190.13 on the settlement day determined in section 276.09, for the 190.14 preceding calendar year. 190.15 Subd. 2. [EXPENDITURES.] In all counties,from said190.16"Forfeited Tax Sale Fund,"the authoritiesduly charged with the190.17execution ofresponsible for carrying out the duties imposed by 190.18 sections 282.01 to 282.13, at their discretion, may expend 190.19 moneysin repairingfrom the forfeited tax sale fund to repair 190.20 any sewer or water main either inside or outside of any curb 190.21 line situated along any property forfeited to the state for 190.22 nonpayment of taxes, to acquire and maintain equipment used 190.23 exclusively for the maintenance and improvement of tax-forfeited 190.24 lands,andto cut down, otherwise destroy or eradicate noxious 190.25 weeds on all tax-forfeited lands. In any year, the money to be190.26expended for the cutting down, destruction or eradication of190.27noxious weeds shall not exceed in amount more than ten percent190.28of the net proceeds of said "Forfeited Tax Sale Fund" during the190.29preceding calendar year, or $10,000, whichever is the lesser190.30sum, and to maintain tax-forfeited lands. 190.31 Sec. 14. Minnesota Statutes 1998, section 282.241, is 190.32 amended to read: 190.33 282.241 [REPURCHASE AFTER FORFEITURE.] 190.34 The owner at the time of forfeiture, or the owner's heirs, 190.35 devisees, or representatives, or any person to whom the right to 190.36 pay taxes was given by statute, mortgage, or other agreement, 191.1 may repurchase any parcel of land claimed by the state to be 191.2 forfeited to the state for taxes unless before the time 191.3 repurchase is made the parcel is sold under installment 191.4 payments, or otherwise, by the state as provided by law, or is 191.5 under mineral prospecting permit or lease, or proceedings have 191.6 been commenced by the state or any of its political subdivisions 191.7 or by the United States to condemnsuchthe parcel of land. The 191.8 parcel of land may be repurchased for the sum of all delinquent 191.9 taxes and assessments computed under section 282.251, together 191.10 with penalties, interest, and costs, that accrued or would have 191.11 accrued if the parcel of land had not forfeited to the state. 191.12 Except for property which was homesteaded on the date of 191.13 forfeiture,suchrepurchaseshall beis permitted during one 191.14 year only from the date of forfeiture, and in any case only 191.15 after the adoption of a resolution by the board of county 191.16 commissioners determining thattherebyby repurchase undue 191.17 hardship or injustice resulting from the forfeiture will be 191.18 corrected, or that permittingsuchthe repurchase will promote 191.19 the use ofsuchthe lands that will best serve the public 191.20 interest. If the county board has good cause to believe that a 191.21 repurchase installment payment plan for a particular parcel is 191.22 unnecessary and not in the public interest, the county board may 191.23 require as a condition of repurchase that the entire repurchase 191.24 price be paid at the time of repurchase. A repurchaseshall191.25beis subject to any easement, lease, or other encumbrance 191.26 granted by the stateprior theretobefore the repurchase, and if 191.27saidthe land is located within a restricted area established by 191.28 any county under Laws 1939, chapter 340,suchthe repurchase 191.29shallmust not be permitted unlesssaidthe resolutionwith191.30respect theretoapproving the repurchase is adopted by the 191.31 unanimous vote of the board of county commissioners. 191.32 The person seeking to repurchase under this section shall 191.33 pay all maintenance costs incurred by the county auditor during 191.34 the time the property was tax-forfeited. 191.35 Sec. 15. Minnesota Statutes 1998, section 282.261, 191.36 subdivision 4, is amended to read: 192.1 Subd. 4. [SERVICE FEE.] The county auditor may collect a 192.2 service fee to cover administrative costs as set by the county 192.3 board for each repurchasecontract approvedapplication received 192.4 after July 1, 1985. The feeshallmust be paid at the time of 192.5repurchaseapplication andshallmust be credited to the county 192.6 general revenue fund. 192.7 Sec. 16. Minnesota Statutes 1998, section 282.261, is 192.8 amended by adding a subdivision to read: 192.9 Subd. 5. [COUNTY MAY IMPOSE CONDITIONS OF REPURCHASE.] The 192.10 county auditor, after receiving county board approval, may 192.11 impose conditions on repurchase of tax-forfeited lands limiting 192.12 the use of the parcel subject to the repurchase, including, but 192.13 not limited to, environmental remediation action plan 192.14 restrictions or covenants, or easements for lines or equipment 192.15 for telephone, telegraph, electric power, or telecommunications. 192.16 Sec. 17. Minnesota Statutes 1998, section 283.10, is 192.17 amended to read: 192.18 283.10 [APPLICATION MUST BE MADE WITHIN TWO YEARS.] 192.19 Nosuch refundment shallrefund may be granted unless an 192.20 applicationtherefor shall be dulyfor refund is approved and 192.21 presented to the commissioner of revenue within two years from 192.22 the date ofsuch tax certificate orthe state assignment 192.23 certificate. 192.24 Sec. 18. Minnesota Statutes 1998, section 375.192, 192.25 subdivision 2, is amended to read: 192.26 Subd. 2. [PROCEDURE, CONDITIONS.] Upon written application 192.27 by the owner of any property, the county board may grant the 192.28 reduction or abatement of estimated market valuation or taxes 192.29 and of any costs, penalties, or interest on them as the board 192.30 deems just and equitable and order the refund in whole or part 192.31 of any taxes, costs, penalties, or interest which have been 192.32 erroneously or unjustly paid. Except as provided in sections 192.33 469.1812 to 469.1815, no reduction or abatement may be granted 192.34 on the basis of providing an incentive for economic development 192.35 or redevelopment. Except as provided in section 375.194, the 192.36 county boardis authorized tomay consider and grant reductions 193.1 or abatements on applications only as they relate to taxes 193.2 payable in the current year and the two prior years; provided 193.3 that reductions or abatements for the two prior years shall be 193.4 considered or granted only for (i) clerical errors, or (ii) when 193.5 the taxpayer fails to file for a reduction or an adjustment due 193.6 to hardship, as determined by the county board. The application 193.7 must include the social security number of the applicant. The 193.8 social security number is private data on individuals as defined 193.9 by section 13.02, subdivision 12. All applications must be 193.10 approved by the county assessor, or, if the property is located 193.11 in a city of the first or second class having a city assessor, 193.12 by the city assessor, and by the county auditor before 193.13 consideration by the county board, except that the part of the 193.14 application which is for the abatement of penalty or interest 193.15 must be approved by the county treasurer and county auditor. 193.16 Approval by the county or city assessor is not required for 193.17 abatements of penalty or interest. No reduction, abatement, or 193.18 refund of any special assessments made or levied by any 193.19 municipality for local improvements shall be made unless it is 193.20 also approved by the board of review or similar taxing authority 193.21 of the municipality.Before taking actionOn any reduction or 193.22 abatementwherewhen the reduction of taxes, costs, penalties, 193.23 and interest exceed $10,000, the county board shall give20193.24days'notice within 20 days to the school board and the 193.25 municipality in which the property is located. The notice must 193.26 describe the property involved, the actual amount of the 193.27 reduction being sought, and the reason for the reduction.If193.28the school board or the municipality object to the granting of193.29the reduction or abatement, the county board must refer the193.30abatement or reduction to the commissioner of revenue with its193.31recommendation. The commissioner shall consider the abatement193.32or reduction under section 270.07, subdivision 1.193.33 An appeal may not be taken to the tax court from any order 193.34 of the county board made in the exercise of the discretionary 193.35 authority granted in this section. 193.36 The county auditor shall notify the commissioner of revenue 194.1 of all abatements resulting from the erroneous classification of 194.2 real property, for tax purposes, as nonhomestead property. For 194.3 the abatements relating to the current year's tax processed 194.4 through June 30, the auditor shall notify the commissioner on or 194.5 before July 31 of that same year of all abatement applications 194.6 granted. For the abatements relating to the current year's tax 194.7 processed after June 30 through the balance of the year, the 194.8 auditor shall notify the commissioner on or before the following 194.9 January 31 of all applications granted. The county auditor 194.10 shall submit a form containing the social security number of the 194.11 applicant and such other information the commissioner prescribes. 194.12 Sec. 19. Minnesota Statutes 1998, section 383C.482, 194.13 subdivision 1, is amended to read: 194.14 Subdivision 1. [AUDITOR TO SEARCH RECORDS; CERTIFICATES.] 194.15 The St. Louis county auditor, upon written application of any 194.16 person, shallmakesearchofthe records of the auditor's office 194.17 and the county treasurer's office, and ascertain the amount of 194.18 current tax against any lot or parcel of land described in the 194.19 application and the existence of all tax liens and tax sales as 194.20 tosuchthe lot or parcel of land, and certify the result of 194.21suchthe search under the seal of office, giving the description 194.22 of the lot or parcel of land, the amount of the current tax, if 194.23 any, and all tax liens and tax sales shown by such records, and 194.24 the amountthereofof liens and tax sales, the year of tax 194.25 covered bysuchthe lien, and the date of tax sale, and the name194.26of the purchaser at such tax sale. For the purpose of 194.27 ascertaining the current tax againstsucha lot or parcel of 194.28 land, the county auditor has the right of access to the records 194.29 of current taxes in the office of the county treasurer. 194.30 Sec. 20. [REPEALER.] 194.31 Minnesota Statutes 1998, sections 92.22; 280.27; 281.13; 194.32 281.38; 284.01; 284.02; 284.03; 284.04; 284.05; and 284.06, are 194.33 repealed. 194.34 Sec. 21. [EFFECTIVE DATE.] 194.35 This article is effective September 1, 1999, except that 194.36 sections 11 to 14 are effective beginning January 1, 2000. 195.1 ARTICLE 13 195.2 TACONITE TAXATION 195.3 Section 1. Minnesota Statutes 1998, section 298.24, 195.4 subdivision 1, is amended to read: 195.5 Subdivision 1. (a) For concentrate produced in1997 and195.619981999, there is imposed upon taconite and iron sulphides, 195.7 and upon the mining and quarrying thereof, and upon the 195.8 production of iron ore concentrate therefrom, and upon the 195.9 concentrate so produced, a tax of $2.141 per gross ton of 195.10 merchantable iron ore concentrate produced therefrom. 195.11 (b) For concentrates produced in19992000 and subsequent 195.12 years, the tax rate shall be equal to the preceding year's tax 195.13 rate plus an amount equal to the preceding year's tax rate 195.14 multiplied by the percentage increase in the implicit price 195.15 deflator from the fourth quarter of the second preceding year to 195.16 the fourth quarter of the preceding year. "Implicit price 195.17 deflator" for the gross national product means the implicit 195.18 price deflator prepared by the bureau of economic analysis of 195.19 the United States Department of Commerce. 195.20 (c) On concentrates produced in 1997 and thereafter, an 195.21 additional tax is imposed equal to three cents per gross ton of 195.22 merchantable iron ore concentrate for each one percent that the 195.23 iron content of the product exceeds 72 percent, when dried at 195.24 212 degrees Fahrenheit. 195.25 (d) The tax shall be imposed on the average of the 195.26 production for the current year and the previous two years. The 195.27 rate of the tax imposed will be the current year's tax rate. 195.28 This clause shall not apply in the case of the closing of a 195.29 taconite facility if the property taxes on the facility would be 195.30 higher if this clause and section 298.25 were not applicable. 195.31 (e) If the tax or any part of the tax imposed by this 195.32 subdivision is held to be unconstitutional, a tax of $2.141 per 195.33 gross ton of merchantable iron ore concentrate produced shall be 195.34 imposed. 195.35 (f) Consistent with the intent of this subdivision to 195.36 impose a tax based upon the weight of merchantable iron ore 196.1 concentrate, the commissioner of revenue may indirectly 196.2 determine the weight of merchantable iron ore concentrate 196.3 included in fluxed pellets by subtracting the weight of the 196.4 limestone, dolomite, or olivine derivatives or other basic flux 196.5 additives included in the pellets from the weight of the 196.6 pellets. For purposes of this paragraph, "fluxed pellets" are 196.7 pellets produced in a process in which limestone, dolomite, 196.8 olivine, or other basic flux additives are combined with 196.9 merchantable iron ore concentrate. No subtraction from the 196.10 weight of the pellets shall be allowed for binders, mineral and 196.11 chemical additives other than basic flux additives, or moisture. 196.12 (g)(1) Notwithstanding any other provision of this 196.13 subdivision, for the first two years of a plant's production of 196.14 direct reduced ore, no tax is imposed under this section. As 196.15 used in this paragraph, "direct reduced ore" is ore that results 196.16 in a product that has an iron content of at least 75 percent. 196.17 For the third year of a plant's production of direct reduced 196.18 ore, the rate to be applied to direct reduced ore is 25 percent 196.19 of the rate otherwise determined under this subdivision. For 196.20 the fourth such production year, the rate is 50 percent of the 196.21 rate otherwise determined under this subdivision; for the fifth 196.22 such production year, the rate is 75 percent of the rate 196.23 otherwise determined under this subdivision; and for all 196.24 subsequent production years, the full rate is imposed. 196.25 (2) Subject to clause (1), production of direct reduced ore 196.26 in this state is subject to the tax imposed by this section, but 196.27 if that production is not produced by a producer of taconite or 196.28 iron sulfides, the production of taconite or iron sulfides 196.29 consumed in the production of direct reduced iron in this state 196.30 is not subject to the tax imposed by this section on taconite or 196.31 iron sulfides. 196.32 Sec. 2. Minnesota Statutes 1998, section 298.28, 196.33 subdivision 9a, is amended to read: 196.34 Subd. 9a. [TACONITE ECONOMIC DEVELOPMENT FUND.] (a) 15.4 196.35 cents per ton for distributions in1996, 1998,1999,and2000 196.36and 20.4 cents per ton for distributions in 1997 shall, and 2001 197.1 must be paid to the taconite economic development fund. No 197.2 distribution shall be made under this paragraph in any year in 197.3 which total industry production falls below 30 million tons. 197.4 (b) An amount equal to 50 percent of the tax under section 197.5 298.24 for concentrate sold in the form of pellet chips and 197.6 fines not exceeding 5/16 inch in size and not including crushed 197.7 pellets shall be paid to the taconite economic development 197.8 fund. The amount paid shall not exceed $700,000 annually for 197.9 all companies. If the initial amount to be paid to the fund 197.10 exceeds this amount, each company's payment shall be prorated so 197.11 the total does not exceed $700,000. 197.12 Sec. 3. Minnesota Statutes 1998, section 298.28, 197.13 subdivision 9b, is amended to read: 197.14 Subd. 9b. [TACONITE ENVIRONMENTAL FUND.] Five cents per 197.15 ton for distributions in1998,1999,and2000shall, and 2001 197.16 must be paid to the taconite environmental fund for use under 197.17 section 298.2961. No distribution may be made under this 197.18 paragraph in any year in which total industry production falls 197.19 below 30,000,000 tons. 197.20 Sec. 4. Minnesota Statutes 1998, section 298.296, 197.21 subdivision 4, is amended to read: 197.22 Subd. 4. [TEMPORARY LOAN AUTHORITY.] (a) The board may 197.23 recommend that up to $7,500,000 from the corpus of the trust may 197.24 be used for loans, grants, or equity investments as provided in 197.25 this subdivision. The money would be available for loans for 197.26 construction and equipping of facilities constituting (1) a 197.27 value added iron products plant, which may be either a new plant 197.28 or a facility incorporated into an existing plant that produces 197.29 iron upgraded to a minimum of 75 percent iron content or any 197.30 iron alloy with a total minimum metallic content of 90 percent; 197.31 or (2) a new mine or minerals processing plant for any mineral 197.32 subject to the net proceeds tax imposed under section 298.015. 197.33 A loan under this paragraph may not exceed $5,000,000 for any 197.34 facility. 197.35 (b) Additionally, the board must reserve the first 197.36 $2,000,000 of the net interest, dividends, and earnings arising 198.1 from the investment of the trust after June 30, 1996, to be used 198.2 for additional grants for the purposes set forth in paragraph 198.3 (a). This amount must be reserved until it is used for the 198.4 grantsor until June 30, 1999, whichever is earlier. 198.5 (c) Additionally, the board may recommend that up to 198.6 $5,500,000 from the corpus of the trust may be used for 198.7 additional grants for the purposes set forth in paragraph (a). 198.8 (d) The board may require that it receive an equity 198.9 percentage in any project to which it contributes under this 198.10 section. 198.11(e) The authority to make loans and grants under this198.12subdivision terminates June 30, 1999.198.13 ARTICLE 14 198.14 WATER AND SANITARY SEWER DISTRICTS 198.15 Section 1. [CEDAR LAKE AREA WATER AND SANITARY SEWER 198.16 DISTRICT; DEFINITIONS.] 198.17 Subdivision 1. [APPLICATION.] In sections 1 to 19, the 198.18 definitions in this section apply. 198.19 Subd. 2. [DISTRICT.] "Cedar lake area water and sanitary 198.20 sewer district" and "district" mean the area over which the 198.21 Cedar lake area water and sanitary sewer board has jurisdiction, 198.22 which includes the area within the city of New Prague and Helena 198.23 and Cedar Lake townships in Scott county. The district shall 198.24 precisely describe the area over which it has jurisdiction by a 198.25 metes and bounds description in the comprehensive plan adopted 198.26 pursuant to section 5. The territory may not be larger than the 198.27 area encompassed by the Cedar Lake improvement district, but it 198.28 may be smaller and the area may include a route along public 198.29 rights-of-way from Cedar Lake to the city of New Prague along 198.30 which the sewer main is laid. 198.31 Subd. 3. [BOARD.] "Water and sanitary sewer board" or 198.32 "board" means the Cedar lake area water and sanitary sewer board 198.33 established for the district as provided in subdivision 2. 198.34 Subd. 4. [PERSON.] "Person" means an individual, 198.35 partnership, corporation, limited liability company, 198.36 cooperative, or other organization or entity, public or private. 199.1 Subd. 5. [LOCAL GOVERNMENTAL UNITS.] "Local governmental 199.2 units" or "governmental units" means Scott county, the city of 199.3 New Prague, and Helena and Cedar Lake Townships in Scott county. 199.4 Subd. 6. [ACQUISITION; BETTERMENT.] "Acquisition" and 199.5 "betterment" have the meanings given in Minnesota Statutes, 199.6 section 475.51. 199.7 Subd. 7. [AGENCY.] "Agency" means the Minnesota pollution 199.8 control agency created in Minnesota Statutes, section 116.02. 199.9 Subd. 8. [SEWAGE.] "Sewage" means all liquid or 199.10 water-carried waste products from whatever sources derived, 199.11 together with any groundwater infiltration and surface water as 199.12 may be present. 199.13 Subd. 9. [POLLUTION OF WATER; SEWER SYSTEM.] "Pollution of 199.14 water" and "sewer system" have the meanings given in Minnesota 199.15 Statutes, section 115.01. 199.16 Subd. 10. [TREATMENT WORKS; DISPOSAL SYSTEM.] "Treatment 199.17 works" and "disposal system" have the meanings given in 199.18 Minnesota Statutes, section 115.01. 199.19 Subd. 11. [INTERCEPTOR.] "Interceptor" means a sewer and 199.20 its necessary appurtenances, including but not limited to mains, 199.21 pumping stations, and sewage flow-regulating and -measuring 199.22 stations, that is: 199.23 (1) designed for or used to conduct sewage originating in 199.24 more than one local governmental unit; 199.25 (2) designed or used to conduct all or substantially all 199.26 the sewage originating in a single local governmental unit from 199.27 a point of collection in that unit to an interceptor or 199.28 treatment works outside that unit; or 199.29 (3) determined by the board to be a major collector of 199.30 sewage used or designed to serve a substantial area in the 199.31 district. 199.32 Subd. 12. [DISTRICT DISPOSAL SYSTEM.] "District disposal 199.33 system" means any and all interceptors or treatment works owned, 199.34 constructed, or operated by the board unless designated by the 199.35 board as local water and sanitary sewer facilities. 199.36 Subd. 13. [MUNICIPALITY.] "Municipality" means any town or 200.1 home rule charter or statutory city. 200.2 Subd. 14. [TOTAL COSTS.] "Total costs of acquisition and 200.3 betterment" and "costs of acquisition and betterment" mean all 200.4 acquisition and betterment expenses permitted to be financed out 200.5 of stopped bond proceeds issued in accordance with section 13, 200.6 whether or not the expenses are in fact financed out of the bond 200.7 proceeds. 200.8 Subd. 15. [CURRENT COSTS.] "Current costs of acquisition, 200.9 betterment, and debt service" means interest and principal 200.10 estimated to be due during the budget year on bonds issued to 200.11 finance the acquisition and betterment and all other costs of 200.12 acquisition and betterment estimated to be paid during the year 200.13 from funds other than bond proceeds and federal or state grants. 200.14 Subd. 16. [RESIDENT.] "Resident" means the owner of a 200.15 dwelling located in the district and receiving water or sewer 200.16 service. 200.17 Sec. 2. [WATER AND SANITARY SEWER BOARD.] 200.18 Subdivision 1. [ESTABLISHMENT.] A water and sanitary sewer 200.19 district is established in Helena and Cedar Lake townships and 200.20 the city of New Prague in Scott county, to be known as the Cedar 200.21 lake area water and sanitary sewer district. The water and 200.22 sewer district is under the control and management of the Cedar 200.23 lake area water and sanitary sewer board. The board is 200.24 established as a public corporation and political subdivision of 200.25 the state with perpetual succession and all the rights, powers, 200.26 privileges, immunities, and duties granted to or imposed upon a 200.27 municipal corporation, as provided in sections 1 to 19. 200.28 Subd. 2. [MEMBERS AND SELECTION.] The board is composed of 200.29 seven members selected as provided in this subdivision. Each of 200.30 the town boards of the townships shall meet to appoint two 200.31 residents to the water and sanitary sewer board. The township 200.32 appointees must live on Cedar lake and must be served by the 200.33 system. One member must be selected by the city of New Prague. 200.34 Two members must be selected by the Scott county board of 200.35 commissioners. Each member has one vote. The first terms are 200.36 as follows: two for one year, two for two years, and three for 201.1 three years, fixed by lot at the district's first meeting. 201.2 Thereafter, all terms are for three years. 201.3 Subd. 3. [TIME LIMITS FOR SELECTION.] The board members 201.4 must be selected as provided in subdivision 2 within 60 days 201.5 after sections 1 to 19 are effective. The successor to each 201.6 board member must be selected at any time within 60 days before 201.7 the expiration of the member's term in the same manner as the 201.8 predecessor was selected. A vacancy on the board must be filled 201.9 within 60 days after it occurs. 201.10 Subd. 4. [VACANCIES.] If the office of a board member 201.11 becomes vacant, the vacancy must be filled for the unexpired 201.12 term in the manner provided for selection of the member who 201.13 vacated the office. The office is deemed vacant under the 201.14 conditions specified in Minnesota Statutes, section 351.02. 201.15 Subd. 5. [REMOVAL.] A board member may be removed by the 201.16 unanimous vote of the governing body appointing the member, with 201.17 or without cause, or for malfeasance or nonfeasance in the 201.18 performance of official duties as provided by Minnesota 201.19 Statutes, sections 351.14 to 351.23. 201.20 Subd. 6. [CERTIFICATES OF SELECTION; OATH OF OFFICE.] A 201.21 certificate of selection of every board member selected under 201.22 subdivision 2 stating the term for which selected, must be made 201.23 by the respective town clerks. The certificates, with the 201.24 approval appended by other authority, if required, must be filed 201.25 with the secretary of state. Counterparts thereof must be 201.26 furnished to the board member and the secretary of the board. 201.27 Each member shall qualify by taking and subscribing the oath of 201.28 office prescribed by the Minnesota Constitution, article 5, 201.29 section 8. The oath, duly certified by the official 201.30 administering the same, must be filed with the secretary of 201.31 state and the secretary of the board. 201.32 Subd. 7. [BOARD MEMBERS' COMPENSATION.] Each board member, 201.33 except the chair, may be paid a per diem compensation in 201.34 accordance with the board's bylaws for meetings and for other 201.35 services as are specifically authorized by the board, not to 201.36 exceed $1,000 in any one year. The chair may be paid a per diem 202.1 compensation in accordance with the board's bylaws for meetings 202.2 and for other services specifically authorized by the board, not 202.3 to exceed $1,500 in any one year. All members of the board must 202.4 be reimbursed for all reasonable and necessary expenses actually 202.5 incurred in the performance of duties. 202.6 Sec. 3. [GENERAL PROVISIONS FOR ORGANIZATION AND OPERATION 202.7 OF BOARD.] 202.8 Subdivision 1. [ORGANIZATION; OFFICERS; MEETINGS; 202.9 SEAL.] After the selection and qualification of all board 202.10 members, the board must meet to organize the board at the call 202.11 of any two board members, upon seven days' notice by registered 202.12 mail to the remaining board members, at a time and place within 202.13 the district specified in the notice. A majority of the members 202.14 is a quorum at that meeting and all other meetings of the board, 202.15 but a lesser number may meet and adjourn from time to time and 202.16 compel the attendance of absent members. At the first meeting 202.17 the board shall select its officers and conduct other 202.18 organizational business as may be necessary. Thereafter the 202.19 board shall meet regularly at the time and place that the board 202.20 designates by resolution. Special meetings may be held at any 202.21 time upon call of the chair or any two members, upon written 202.22 notice sent by mail to each member at least three days before 202.23 the meeting, or upon other notice as the board by resolution may 202.24 provide, or without notice if each member is present or files 202.25 with the secretary a written consent to the meeting either 202.26 before or after the meeting. Except as otherwise provided in 202.27 sections 1 to 19, any action within the authority of the board 202.28 may be taken by the affirmative vote of a majority of the board 202.29 and may be taken by regular or adjourned regular meeting or at a 202.30 duly held special meeting, but in any case only if a quorum is 202.31 present. Meetings of the board must be open to the public. The 202.32 board may adopt a seal, which must be officially and judicially 202.33 noticed, to authenticate instruments executed by its authority, 202.34 but omission of the seal does not affect the validity of any 202.35 instrument. 202.36 Subd. 2. [CHAIR.] The board shall elect a chair from its 203.1 membership. The term of the first chair of the board expires on 203.2 January 1, 2001, and the terms of successor chairs expire on 203.3 January 1 of each succeeding year. The chair shall preside at 203.4 all meetings of the board, if present, and shall perform all 203.5 other duties and functions usually incumbent upon such an 203.6 officer, and all administrative functions assigned to the chair 203.7 by the board. The board shall elect a vice-chair from its 203.8 membership to act for the chair during temporary absence or 203.9 disability. 203.10 Subd. 3. [SECRETARY AND TREASURER.] The board shall select 203.11 persons who may, but need not be, members of the board, to act 203.12 as its secretary and treasurer. The two offices may be combined. 203.13 The secretary and treasurer shall hold office at the pleasure of 203.14 the board, subject to the terms of any contract of employment 203.15 that the board may enter into with the secretary or treasurer. 203.16 The secretary shall record the minutes of all meetings of the 203.17 board, and be the custodian of all books and records of the 203.18 board except those that the board entrusts to the custody of a 203.19 designated employee. The treasurer is the custodian of all 203.20 money received by the board except as the board otherwise 203.21 entrusts to the custody of a designated employee. The board may 203.22 appoint a deputy to perform any and all functions of either the 203.23 secretary or the treasurer. A secretary or treasurer who is not 203.24 a member of the board or a deputy of either does not have the 203.25 right to vote. 203.26 Subd. 4. [PUBLIC EMPLOYEES.] The executive director and 203.27 other persons employed by the district are public employees and 203.28 have all the rights and duties conferred on public employees 203.29 under Minnesota Statutes, sections 179A.01 to 179A.25. The 203.30 board may elect to have employees become members of either the 203.31 public employees retirement association or the Minnesota state 203.32 retirement system. The compensation and conditions of 203.33 employment of the employees must be governed by rules applicable 203.34 to state employees in the classified service and to the 203.35 provisions of Minnesota Statutes, chapter 15A. 203.36 Subd. 5. [PROCEDURES.] The board shall adopt resolutions 204.1 or bylaws establishing procedures for board action, personnel 204.2 administration, keeping records, approving claims, authorizing 204.3 or making disbursements, safekeeping funds, and auditing all 204.4 financial operations of the board. 204.5 Subd. 6. [SURETY BONDS AND INSURANCE.] The board may 204.6 procure surety bonds for its officers and employees, in amounts 204.7 deemed necessary to ensure proper performance of their duties 204.8 and proper accounting for funds in their custody. It may 204.9 procure insurance against risks to property and liability of the 204.10 board and its officers, agents, and employees for personal 204.11 injuries or death and property damage and destruction, in 204.12 amounts deemed necessary or desirable, with the force and effect 204.13 stated in Minnesota Statutes, chapter 466. 204.14 Sec. 4. [GENERAL POWERS OF BOARD.] 204.15 Subdivision 1. [SCOPE.] The board has all powers necessary 204.16 or convenient to discharge the duties imposed upon it by law. 204.17 The powers include those specified in this section, but the 204.18 express grant or enumeration of powers does not limit the 204.19 generality or scope of the grant of powers contained in this 204.20 subdivision. 204.21 Subd. 2. [SUIT.] The board may sue or be sued. 204.22 Subd. 3. [CONTRACT.] The board may enter into any contract 204.23 necessary or proper for the exercise of its powers or the 204.24 accomplishment of its purposes. 204.25 Subd. 4. [GIFTS, GRANTS, LOANS.] The board may accept 204.26 gifts, apply for and accept grants or loans of money or other 204.27 property from the United States, the state, or any person for 204.28 any of its purposes, enter into any agreement required in 204.29 connection with them, and hold, use, and dispose of the money or 204.30 property in accordance with the terms of the gift, grant, loan, 204.31 or agreement relating to it. With respect to loans or grants of 204.32 funds or real or personal property or other assistance from any 204.33 state or federal government or its agency or instrumentality, 204.34 the board may contract to do and perform all acts and things 204.35 required as a condition or consideration for the gift, grant, or 204.36 loan pursuant to state or federal law or regulations, whether or 205.1 not included among the powers expressly granted to the board in 205.2 sections 1 to 19. 205.3 Subd. 5. [COOPERATIVE ACTION.] The board may act under 205.4 Minnesota Statutes, section 471.59, or any other appropriate law 205.5 providing for joint or cooperative action between governmental 205.6 units. 205.7 Subd. 6. [STUDIES AND INVESTIGATIONS.] The board may 205.8 conduct research studies and programs, collect and analyze data, 205.9 prepare reports, maps, charts, and tables, and conduct all 205.10 necessary hearings and investigations in connection with the 205.11 design, construction, and operation of the district disposal 205.12 system. 205.13 Subd. 7. [EMPLOYEES, TERMS.] The board may employ on terms 205.14 it deems advisable, persons or firms performing engineering, 205.15 legal, or other services of a professional nature; require any 205.16 employee to obtain and file with it an individual bond or 205.17 fidelity insurance policy; and procure insurance in amounts it 205.18 deems necessary against liability of the board or its officers 205.19 or both, for personal injury or death and property damage or 205.20 destruction, with the force and effect stated in Minnesota 205.21 Statutes, chapter 466, and against risks of damage to or 205.22 destruction of any of its facilities, equipment, or other 205.23 property as it deems necessary. 205.24 Subd. 8. [PROPERTY RIGHTS, POWERS.] The board may acquire 205.25 by purchase, lease, condemnation, gift, or grant, any real or 205.26 personal property including positive and negative easements and 205.27 water and air rights, and it may construct, enlarge, improve, 205.28 replace, repair, maintain, and operate any interceptor, 205.29 treatment works, or water facility determined to be necessary or 205.30 convenient for the collection and disposal of sewage in the 205.31 district. Any local governmental unit and the commissioners of 205.32 transportation and natural resources are authorized to convey to 205.33 or permit the use of any of the above-mentioned facilities owned 205.34 or controlled by it, by the board, subject to the rights of the 205.35 holders of any bonds issued with respect to those facilities, 205.36 with or without compensation, without an election or approval by 206.1 any other governmental unit or agency. All powers conferred by 206.2 this subdivision may be exercised both within or without the 206.3 district as may be necessary for the exercise by the board of 206.4 its powers or the accomplishment of its purposes. The board may 206.5 hold, lease, convey, or otherwise dispose of the above-mentioned 206.6 property for its purposes upon the terms and in the manner it 206.7 deems advisable. Unless otherwise provided, the right to 206.8 acquire lands and property rights by condemnation may be 206.9 exercised only in accordance with Minnesota Statutes, sections 206.10 117.011 to 117.232, and applies to any property or interest in 206.11 the property owned by any local governmental unit. Property 206.12 devoted to an actual public use at the time, or held to be 206.13 devoted to such a use within a reasonable time, must not be so 206.14 acquired unless a court of competent jurisdiction determines 206.15 that the use proposed by the board is paramount to the existing 206.16 use. Except in the case of property in actual public use, the 206.17 board may take possession of any property on which condemnation 206.18 proceedings have been commenced at any time after the issuance 206.19 of a court order appointing commissioners for its condemnation. 206.20 Subd. 9. [RELATIONSHIP TO OTHER PROPERTIES.] The board may 206.21 construct or maintain its systems or facilities in, along, on, 206.22 under, over, or through public waters, streets, bridges, 206.23 viaducts, and other public rights-of-way without first obtaining 206.24 a franchise from a county or municipality having jurisdiction 206.25 over them. However, the facilities must be constructed and 206.26 maintained in accordance with the ordinances and resolutions of 206.27 the county or municipality relating to constructing, installing, 206.28 and maintaining similar facilities on public properties and must 206.29 not unnecessarily obstruct the public use of those rights-of-way. 206.30 Subd. 10. [DISPOSAL OF PROPERTY.] The board may sell, 206.31 lease, or otherwise dispose of any real or personal property 206.32 acquired by it which is no longer required for accomplishment of 206.33 its purposes. The property may be sold in the manner provided 206.34 by Minnesota Statutes, section 469.065, insofar as practical. 206.35 The board may give notice of sale as it deems appropriate. When 206.36 the board determines that any property or any part of the 207.1 district disposal system acquired from a local governmental unit 207.2 without compensation is no longer required but is required as a 207.3 local facility by the governmental unit from which it was 207.4 acquired, the board may by resolution transfer it to that 207.5 governmental unit. 207.6 Subd. 11. [AGREEMENTS WITH OTHER GOVERNMENTAL UNITS.] The 207.7 board may contract with the United States or any agency thereof, 207.8 any state or agency thereof, or any regional public planning 207.9 body in the state with jurisdiction over any part of the 207.10 district, or any other municipal or public corporation, or 207.11 governmental subdivision or agency or political subdivision in 207.12 any state, for the joint use of any facility owned by the board 207.13 or such entity, for the operation by that entity of any system 207.14 or facility of the board, or for the performance on the board's 207.15 behalf of any service, including but not limited to planning, on 207.16 terms as may be agreed upon by the contracting parties. Unless 207.17 designated by the board as a local water and sanitary sewer 207.18 facility, any treatment works or interceptor jointly used, or 207.19 operated on behalf of the board, as provided in this 207.20 subdivision, is deemed to be operated by the board for purposes 207.21 of including those facilities in the district disposal system. 207.22 Sec. 5. [COMPREHENSIVE PLAN.] 207.23 Subdivision 1. [BOARD PLAN AND PROGRAM.] The board shall 207.24 adopt a comprehensive plan for the collection, treatment, and 207.25 disposal of sewage in the district for a designated period the 207.26 board deems proper and reasonable. The board shall prepare and 207.27 adopt subsequent comprehensive plans for the collection, 207.28 treatment, and disposal of sewage in the district for each 207.29 succeeding designated period as the board deems proper and 207.30 reasonable. All comprehensive plans of the district shall be 207.31 subject to the planning and zoning authority of Scott county and 207.32 in conformance with all planning and zoning ordinances of Scott 207.33 county. The first plan, as modified by the board, and any 207.34 subsequent plan shall take into account the preservation and 207.35 best and most economic use of water and other natural resources 207.36 in the area; the preservation, use, and potential for use of 208.1 lands adjoining waters of the state to be used for the disposal 208.2 of sewage; and the impact the disposal system will have on 208.3 present and future land use in the area affected. In no case 208.4 shall the comprehensive plan provide for more than 325 208.5 connections to the disposal system. All connections must be 208.6 charged a full assessment. Connections made after the initial 208.7 assessment period ends must be charged an amount equal to the 208.8 initial assessment plus an adjustment for inflation and plus any 208.9 other charges determined to be reasonable and necessary by the 208.10 board. Deferred assessments may be permitted, as provided for 208.11 in Minnesota Statutes, chapter 429. The plans shall include the 208.12 general location of needed interceptors and treatment works, a 208.13 description of the area that is to be served by the various 208.14 interceptors and treatment works, a long-range capital 208.15 improvements program, and any other details as the board deems 208.16 appropriate. In developing the plans, the board shall consult 208.17 with persons designated for the purpose by governing bodies of 208.18 any governmental unit within the district to represent the 208.19 entities and shall consider the data, resources, and input 208.20 offered to the board by the entities and any planning agency 208.21 acting on behalf of one or more of the entities. Each 208.22 comprehensive plan of the district must be approved by the 208.23 metropolitan council prior to implementation. Each plan, when 208.24 adopted, must be followed in the district and may be revised as 208.25 often as the board deems necessary. 208.26 Subd. 2. [COMPREHENSIVE PLANS; HEARING.] Before adopting 208.27 any subsequent comprehensive plan, the board shall hold a public 208.28 hearing on the proposed plan at a time and place in the district 208.29 that it selects. The hearing may be continued from time to 208.30 time. Not less than 45 days before the hearing, the board shall 208.31 publish notice of the hearing in a newspaper having general 208.32 circulation in the district, stating the date, time, and place 208.33 of the hearing, and the place where the proposed plan may be 208.34 examined by any interested person. At the hearing, all 208.35 interested persons must be permitted to present their views on 208.36 the plan. 209.1 Sec. 6. [POWERS TO ISSUE OBLIGATIONS AND IMPOSE SPECIAL 209.2 ASSESSMENTS.] 209.3 The Cedar lake area water and sanitary sewer board, in 209.4 order to implement the powers granted under sections 1 to 19 to 209.5 establish, maintain, and administer the Cedar lake area water 209.6 and sanitary sewer district, may issue obligations and impose 209.7 special assessments against benefited property within the limits 209.8 of the district benefited by facilities constructed under 209.9 sections 1 to 19 in the manner provided for local governments by 209.10 Minnesota Statutes, chapter 429. 209.11 Sec. 7. [SYSTEM EXPANSION; APPLICATION TO CITIES.] 209.12 The authority of the water and sanitary sewer board to 209.13 establish water or sewer or combined water and sewer systems 209.14 under this section extends to areas within the Cedar lake area 209.15 water and sanitary sewer district organized into cities when 209.16 requested by resolution of the governing body of the affected 209.17 city or when ordered by the Minnesota pollution control agency 209.18 after notice and hearing. For the purpose of any petition filed 209.19 or special assessment levied with respect to any system, the 209.20 entire area to be served within a city must be treated as if it 209.21 were owned by a single person, and the governing body shall 209.22 exercise all the rights and be subject to all the duties of an 209.23 owner of the area, and shall have power to provide for the 209.24 payment of all special assessments and other charges imposed 209.25 upon the area with respect to the system by the appropriation of 209.26 money, the collection of service charges, or the levy of taxes, 209.27 which shall be subject to no limitation of rate or amount. 209.28 Sec. 8. [SEWAGE COLLECTION AND DISPOSAL; POWERS.] 209.29 Subdivision 1. [POWERS.] In addition to all other powers 209.30 conferred upon the board in sections 1 to 19, it has the powers 209.31 specified in this section. 209.32 Subd. 2. [DISCHARGE OF TREATED SEWAGE.] The board may 209.33 discharge the effluent from any treatment works operated by it 209.34 into any waters of the state, subject to approval of the agency 209.35 if required and in accordance with any effluent or water quality 209.36 standards lawfully adopted by the agency, any interstate agency, 210.1 or any federal agency having jurisdiction. 210.2 Subd. 3. [UTILIZATION OF DISTRICT SYSTEM.] The board may 210.3 require any person or local governmental unit to provide for the 210.4 discharge of any sewage, directly or indirectly, into the 210.5 district disposal system, or to connect any disposal system or a 210.6 part of it with the district disposal system wherever reasonable 210.7 opportunity for connection is provided; may regulate the manner 210.8 in which the connections are made; may require any person or 210.9 local governmental unit discharging sewage into the disposal 210.10 system to provide preliminary treatment for it; may prohibit the 210.11 discharge into the district disposal system of any substance 210.12 that it determines will or may be harmful to the system or any 210.13 persons operating it; and may require any local governmental 210.14 unit to discontinue the acquisition, betterment, or operation of 210.15 any facility for the unit's disposal system wherever and so far 210.16 as adequate service is or will be provided by the district 210.17 disposal system. 210.18 Subd. 4. [SYSTEM OF COST RECOVERY TO COMPLY WITH 210.19 APPLICABLE REGULATIONS.] Any charges, connection fees, or other 210.20 cost-recovery techniques imposed on persons discharging sewage 210.21 directly or indirectly into the district disposal system must 210.22 comply with applicable state and federal law, including state 210.23 and federal regulations governing grant applications. 210.24 Sec. 9. [BUDGET.] 210.25 (a) The board shall prepare and adopt, on or before October 210.26 1 in 2000 and each year thereafter, a budget showing for the 210.27 following calendar year or other fiscal year determined by the 210.28 board, sometimes referred to in sections 1 to 19 as the budget 210.29 year, estimated receipts of money from all sources, including 210.30 but not limited to payments by each local governmental unit, 210.31 federal or state grants, taxes on property, and funds on hand at 210.32 the beginning of the year, and estimated expenditures for: 210.33 (1) costs of operation, administration, and maintenance of 210.34 the district disposal system; 210.35 (2) cost of acquisition and betterment of the district 210.36 disposal system; and 211.1 (3) debt service, including principal and interest, on 211.2 general obligation bonds and certificates issued pursuant to 211.3 section 13, and any money judgments entered by a court of 211.4 competent jurisdiction. 211.5 (b) Expenditures within these general categories, and any 211.6 other categories as the board may from time to time determine, 211.7 must be itemized in detail as the board prescribes. The board 211.8 and its officers, agents, and employees must not spend money for 211.9 any purpose other than debt service without having set forth the 211.10 expense in the budget nor in excess of the amount set forth in 211.11 the budget for it. No obligation to make an expenditure of the 211.12 above-mentioned type is enforceable except as the obligation of 211.13 the person or persons incurring it. The board may amend the 211.14 budget at any time by transferring from one purpose to another 211.15 any sums except money for debt service and bond proceeds or by 211.16 increasing expenditures in any amount by which actual cash 211.17 receipts during the budget year exceed the total amounts 211.18 designated in the original budget. The creation of any 211.19 obligation under section 13, or the receipt of any federal or 211.20 state grant is a sufficient budget designation of the proceeds 211.21 for the purpose for which it is authorized, and of the tax or 211.22 other revenue pledged to pay the obligation and interest on it, 211.23 whether or not specifically included in any annual budget. 211.24 Sec. 10. [ALLOCATION OF COSTS.] 211.25 Subdivision 1. [DEFINITION OF CURRENT COSTS.] The 211.26 estimated cost of administration, operation, maintenance, and 211.27 debt service of the district disposal system to be paid by the 211.28 board in each fiscal year and the estimated costs of acquisition 211.29 and betterment of the system that are to be paid during the year 211.30 from funds other than state or federal grants and bond proceeds 211.31 and all other previously unallocated payments made by the board 211.32 pursuant to sections 1 to 19 to be allocated in the fiscal year 211.33 are referred to as current costs and must be allocated by the 211.34 board as provided in subdivision 2 in the budget for that year. 211.35 Subd. 2. [METHOD OF ALLOCATION OF CURRENT COSTS.] Current 211.36 costs must be allocated in the district on an equitable basis as 212.1 the board may determine by resolution to be in the best 212.2 interests of the district. The adoption or revision of any 212.3 method of allocation used by the board must be by the 212.4 affirmative vote of at least two-thirds of the members of the 212.5 board. 212.6 Sec. 11. [TAX LEVIES.] 212.7 To accomplish any duty imposed on it the board may, in 212.8 addition to the powers granted in sections 1 to 19 and in any 212.9 other law or charter, exercise the powers granted any 212.10 municipality by Minnesota Statutes, chapters 117, 412, 429, 475, 212.11 sections 115.46, 444.075, and 471.59, with respect to the area 212.12 in the district. The board may levy taxes upon all taxable 212.13 property in the district for all or a part of the amount payable 212.14 to the board, pursuant to section 10, to be assessed and 212.15 extended as a tax upon that taxable property by the county 212.16 auditor for the next calendar year, free from any limit of rate 212.17 or amount imposed by law or charter. The tax must be collected 212.18 and remitted in the same manner as other general taxes. 212.19 Sec. 12. [PUBLIC HEARING AND SPECIAL ASSESSMENTS.] 212.20 Subdivision 1. [PUBLIC HEARING REQUIREMENT ON SPECIFIC 212.21 PROJECT.] Before the board orders any project involving the 212.22 acquisition or betterment of any interceptor or treatment works, 212.23 all or a part of the cost of which will be allocated pursuant to 212.24 section 10 as current costs, the board must hold a public 212.25 hearing on the proposed project. The hearing must be held 212.26 following two publications in a newspaper having general 212.27 circulation in the district, stating the time and place of the 212.28 hearing, the general nature and location of the project, the 212.29 estimated total cost of acquisition and betterment, that portion 212.30 of costs estimated to be paid out of federal and state grants, 212.31 and that portion of costs estimated to be allocated. The 212.32 estimates must be best available at the time of the meeting and 212.33 if costs exceed the estimate, the project cannot proceed until 212.34 an additional public hearing is held, with notice as required at 212.35 the initial meeting. The two publications must be a week apart 212.36 and the hearing at least three days after the last publication. 213.1 Not less than 45 days before the hearing, notice of the hearing 213.2 must also be mailed to each clerk of all local governmental 213.3 units in the district, but failure to give mailed notice or any 213.4 defects in the notice does not invalidate the proceedings. The 213.5 project may include all or part of one or more interceptors or 213.6 treatment works. A hearing must not be held on a project unless 213.7 the project is within the area covered by the comprehensive plan 213.8 adopted by the board under section 5, except that the hearing 213.9 may be held simultaneously with a hearing on a comprehensive 213.10 plan. A hearing is not required with respect to a project, no 213.11 part of the costs of which are to be allocated as the current 213.12 costs of acquisition, betterment, and debt service. 213.13 Subd. 2. [NOTICE TO BENEFITED PROPERTY OWNERS.] If the 213.14 board proposes to assess against benefited property within the 213.15 district all or any part of the allocable costs of the project 213.16 as provided in subdivision 5, the board shall, not less than two 213.17 weeks before the hearing provided for in subdivision 1, cause 213.18 mailed notice of the hearing to be given to the owner of each 213.19 parcel within the area proposed to be specially assessed and 213.20 shall also give two weeks' published notice of the hearing. The 213.21 notice of hearing must contain the same information provided in 213.22 the notice published by the board pursuant to subdivision 1, and 213.23 a description of the area proposed to be assessed. For the 213.24 purpose of giving mailed notice, owners are those shown to be on 213.25 the records of the county auditor or, in any county where tax 213.26 statements are mailed by the county treasurer, on the records of 213.27 the county treasurer; but other appropriate records may be used 213.28 for this purpose. For properties that are tax exempt or subject 213.29 to taxation on a gross earnings basis and not listed on the 213.30 records of the county auditor or the county treasurer, the 213.31 owners must be ascertained by any practicable means and mailed 213.32 notice given them as herein provided. Failure to give mailed 213.33 notice or any defects in the notice does not invalidate the 213.34 proceedings of the board. 213.35 Subd. 3. [BOARD PROCEEDINGS PERTAINING TO HEARING.] Before 213.36 adoption of the resolution calling for a hearing under this 214.1 section, the board shall secure from the district engineer or 214.2 some other competent person of the board's selection a report 214.3 advising it in a preliminary way as to whether the proposed 214.4 project is feasible and whether it should be made as proposed or 214.5 in connection with some other project and the estimated costs of 214.6 the project as recommended. No error or omission in the report 214.7 invalidates the proceeding. The board may also take other steps 214.8 before the hearing, as will in its judgment provide helpful 214.9 information in determining the desirability and feasibility of 214.10 the project, including but not limited to preparation of plans 214.11 and specifications and advertisement for bids on them. The 214.12 hearing may be adjourned from time to time and a resolution 214.13 ordering the project may be adopted at any time within six 214.14 months after the date of hearing. In ordering the project the 214.15 board may reduce but not increase the extent of the project as 214.16 stated in the notice of hearing and shall find that the project 214.17 as ordered is in accordance with the comprehensive plan and 214.18 program adopted by the board pursuant to section 5. 214.19 Subd. 4. [EMERGENCY ACTION.] If the board by resolution 214.20 adopted by the affirmative vote of not less than two-thirds of 214.21 its members determines that an emergency exists requiring the 214.22 immediate purchase of materials or supplies or the making of 214.23 emergency repairs, it may order the purchase of those supplies 214.24 and materials and the making of the repairs before any hearing 214.25 required under this section. The board must set as early a date 214.26 as practicable for the hearing at the time it declares the 214.27 emergency. All other provisions of this section must be 214.28 followed in giving notice of and conducting the hearing. 214.29 Nothing in this subdivision prevents the board or its agents 214.30 from purchasing maintenance supplies or incurring maintenance 214.31 costs without regard to the requirements of this section. 214.32 Subd. 5. [POWER OF THE BOARD TO SPECIALLY ASSESS.] The 214.33 board may specially assess all or any part of the costs of 214.34 acquisition and betterment as provided in this subdivision, of 214.35 any project ordered under this section. The special assessments 214.36 must be levied in accordance with Minnesota Statutes, sections 215.1 429.051 to 429.081, except as otherwise provided in this 215.2 subdivision. No other provisions of Minnesota Statutes, chapter 215.3 429, apply. For purposes of levying the special assessments, 215.4 the hearing on the project required in subdivision 1 serves as 215.5 the hearing on the making of the original improvement provided 215.6 for by Minnesota Statutes, section 429.051. The area assessed 215.7 may be less than but may not exceed the area proposed to be 215.8 assessed as stated in the notice of hearing on the project 215.9 provided for in subdivision 2. 215.10 Sec. 13. [BONDS, CERTIFICATES, AND OTHER OBLIGATIONS.] 215.11 Subdivision 1. [BUDGET ANTICIPATION CERTIFICATES OF 215.12 INDEBTEDNESS.] At any time after adoption of its annual budget 215.13 and in anticipation of the collection of tax and other revenues 215.14 estimated and set forth by the board in the budget, except in 215.15 the case of deficiency taxes levied under this subdivision and 215.16 taxes levied for the payment of certificates issued under 215.17 subdivision 2, the board may, by resolution, authorize the 215.18 issuance, negotiation, and sale, in accordance with subdivision 215.19 4 in the form and manner and upon terms it determines, of its 215.20 negotiable general obligation certificates of indebtedness in 215.21 aggregate principal amounts not exceeding 50 percent of the 215.22 total amount of tax collections and other revenues, and maturing 215.23 not later than three months after the close of the budget year 215.24 in which issued. The proceeds of the sale of the certificates 215.25 must be used solely for the purposes for which the tax 215.26 collections and other revenues are to be expended under the 215.27 budget. 215.28 All the tax collections and other revenues included in the 215.29 budget for the budget year, after the expenditure of the tax 215.30 collections and other revenues in accordance with the budget, 215.31 must be irrevocably pledged and appropriated to a special fund 215.32 to pay the principal and interest on the certificates when due. 215.33 If for any reason the tax collections and other revenues are 215.34 insufficient to pay the certificates and interest when due, the 215.35 board shall levy a tax in the amount of the deficiency on all 215.36 taxable property in the district and shall appropriate this 216.1 amount when received to the special fund. 216.2 Subd. 2. [EMERGENCY CERTIFICATES OF INDEBTEDNESS.] If in 216.3 any budget year the receipts of tax and other revenues should 216.4 for some unforeseen cause become insufficient to pay the board's 216.5 current expenses, or if any public emergency should subject it 216.6 to the necessity of making extraordinary expenditures, the board 216.7 may by resolution authorize the issuance, negotiation, and sale, 216.8 in accordance with subdivision 4 in the form and manner and upon 216.9 the terms and conditions it determines, of its negotiable 216.10 general obligation certificates of indebtedness in an amount 216.11 sufficient to meet the deficiency. The board shall levy on all 216.12 taxable property in the district a tax sufficient to pay the 216.13 certificates and interest on the certificates and shall 216.14 appropriate all collections of the tax to a special fund created 216.15 for the payment of the certificates and the interest on them. 216.16 Certificates issued under this subdivision mature not later than 216.17 April 1 in the year following the year in which the tax is 216.18 collectible. 216.19 Subd. 3. [GENERAL OBLIGATION BONDS.] The board may by 216.20 resolution authorize the issuance of general obligation bonds 216.21 for the acquisition or betterment of any part of the district 216.22 disposal system, including but without limitation the payment of 216.23 interest during construction and for a reasonable period 216.24 thereafter, or for the refunding of outstanding bonds, 216.25 certificates of indebtedness, or judgments. The board shall 216.26 pledge its full faith and credit and taxing power for the 216.27 payment of the bonds and shall provide for the issuance and sale 216.28 and for the security of the bonds in the manner provided in 216.29 Minnesota Statutes, chapter 475. The board has the same powers 216.30 and duties as a municipality issuing bonds under that law, 216.31 except that no election is required and the debt limitations of 216.32 Minnesota Statutes, chapter 475, do not apply to the bonds. The 216.33 board may also pledge for the payment of the bonds and deduct 216.34 from the amount of any tax levy required under Minnesota 216.35 Statutes, section 475.61, subdivision 1, and any revenues 216.36 receivable under any state and federal grants anticipated by the 217.1 board and may covenant to refund the bonds if and when and to 217.2 the extent that for any reason the revenues, together with other 217.3 funds available and appropriated for that purpose, are not 217.4 sufficient to pay all principal and interest due or about to 217.5 become due, provided that the revenues have not been anticipated 217.6 by the issuance of certificates under subdivision 1. 217.7 Subd. 4. [MANNER OF SALE AND ISSUANCE OF CERTIFICATES.] 217.8 Certificates issued under subdivisions 1 and 2 may be issued and 217.9 sold by negotiation, without public sale, and may be sold at a 217.10 price equal to the percentage of the par value of the 217.11 certificates, plus accrued interest, and bearing interest at the 217.12 rate determined by the board. An election is not required to 217.13 authorize the issuance of the certificates. The certificates 217.14 must bear the same rate of interest after maturity as before and 217.15 the full faith and credit and taxing power of the board must be 217.16 pledged to the payment of the certificates. 217.17 Sec. 14. [DEPOSITORIES.] 217.18 The board shall designate one or more national or state 217.19 banks, or trust companies authorized to do a banking business, 217.20 as official depositories for money of the board, and shall 217.21 require the treasurer to deposit all or a part of the money in 217.22 those institutions. The designation must be in writing and set 217.23 forth all the terms and conditions upon which the deposits are 217.24 made, and must be signed by the chair and treasurer and made a 217.25 part of the minutes of the board. 217.26 Sec. 15. [MONEY, ACCOUNTS, AND INVESTMENTS.] 217.27 Subdivision 1. [RECEIPT AND APPLICATION.] Money received 217.28 by the board must be deposited or invested by the treasurer and 217.29 disposed of as the board may direct in accordance with its 217.30 budget; provided that any money that has been pledged or 217.31 dedicated by the board to the payment of obligations or interest 217.32 on the obligations or expenses incident thereto, or for any 217.33 other specific purpose authorized by law, must be paid by the 217.34 treasurer into the fund to which it has been pledged. 217.35 Subd. 2. [FUNDS AND ACCOUNTS.] (a) The board's treasurer 217.36 shall establish funds and accounts as may be necessary or 218.1 convenient to handle the receipts and disbursements of the board 218.2 in an orderly fashion. 218.3 (b) The funds and accounts must be audited annually by a 218.4 certified public accountant at the expense of the district. 218.5 Subd. 3. [DEPOSIT AND INVESTMENT.] The money on hand in 218.6 those funds and accounts may be deposited in the official 218.7 depositories of the board or invested as provided in this 218.8 subdivision. Any amount not currently needed or required by law 218.9 to be kept in cash on deposit may be invested in obligations 218.10 authorized for the investment of municipal sinking funds by 218.11 Minnesota Statutes, section 118A.04. The money may also be held 218.12 under certificates of deposit issued by any official depository 218.13 of the board. 218.14 Subd. 4. [BOND PROCEEDS.] The use of proceeds of all bonds 218.15 issued by the board for the acquisition and betterment of the 218.16 district disposal system, and the use, other than investment, of 218.17 all money on hand in any sinking fund or funds of the board, is 218.18 governed by the provisions of Minnesota Statutes, chapter 475, 218.19 the provisions of sections 1 to 19, and the provisions of 218.20 resolutions authorizing the issuance of the bonds. When 218.21 received, the bond proceeds must be transferred to the treasurer 218.22 of the board for safekeeping, investment, and payment of the 218.23 costs for which they were issued. 218.24 Subd. 5. [AUDIT.] The board shall provide for and pay the 218.25 cost of an independent annual audit of its official books and 218.26 records by the state auditor or a public accountant authorized 218.27 to perform that function under Minnesota Statutes, chapter 6. 218.28 Sec. 16. [SERVICE CONTRACTS WITH GOVERNMENTAL ENTITIES 218.29 OUTSIDE THE JURISDICTION OF THE BOARD.] 218.30 (a) The board may contract with the United States or any 218.31 agency of the federal government, any state or its agency, or 218.32 any municipal or public corporation, governmental subdivision or 218.33 agency or political subdivision in any state, outside the 218.34 jurisdiction of the board, for furnishing services to those 218.35 entities, including but not limited to planning for and the 218.36 acquisition, betterment, operation, administration, and 219.1 maintenance of any or all interceptors, treatment works, and 219.2 local water and sanitary sewer facilities. The board may 219.3 include as one of the terms of the contract that the entity must 219.4 pay to the board an amount agreed upon as a reasonable estimate 219.5 of the proportionate share properly allocable to the entity of 219.6 costs of acquisition, betterment, and debt service previously 219.7 allocated in the district. When payments are made by entities 219.8 to the board, they must be applied in reduction of the total 219.9 amount of costs thereafter allocated in the district, on an 219.10 equitable basis as the board deems to be in the best interests 219.11 of the district, applying so far as practicable and appropriate 219.12 the criteria set forth in section 10, subdivision 2. A 219.13 municipality in the state of Minnesota may enter into a contract 219.14 and perform all acts and things required as a condition or 219.15 consideration therefor consistent with the purposes of sections 219.16 1 to 19, whether or not included among the powers otherwise 219.17 granted to the municipality by law or charter. 219.18 (b) The board shall contract with a qualified entity to 219.19 make necessary inspections of the district facilities, and to 219.20 otherwise process or assist in processing any of the work of the 219.21 district. 219.22 Sec. 17. [CONTRACTS FOR CONSTRUCTION, MATERIALS, SUPPLIES, 219.23 AND EQUIPMENT.] 219.24 When the board orders a project involving the acquisition 219.25 or betterment of a part of the district disposal system, it 219.26 shall cause plans and specifications of the project to be made, 219.27 or if previously made, to be modified, if necessary, and to be 219.28 approved by the agency if required, and after any required 219.29 approval by the agency, one or more contracts for work and 219.30 materials called for by the plans and specification may be 219.31 awarded as provided in Minnesota Statutes, section 471.345. 219.32 Sec. 18. [PROPERTY EXEMPT FROM TAXATION.] 219.33 Any properties, real or personal, owned, leased, 219.34 controlled, used, or occupied by the water and sanitary sewer 219.35 board for any purpose under sections 1 to 19 are declared to be 219.36 acquired, owned, leased, controlled, used, and occupied for 220.1 public, governmental, and municipal purposes, and are exempt 220.2 from taxation by the state or any political subdivision of the 220.3 state. The properties are subject to special assessments levied 220.4 by a political subdivision for a local improvement in amounts 220.5 proportionate to and not exceeding the special benefit received 220.6 by the properties from the improvement. 220.7 Sec. 19. [RELATION TO EXISTING LAWS.] 220.8 Sections 1 to 19 must be given full effect notwithstanding 220.9 the provisions of any law or charter inconsistent with sections 220.10 1 to 19. The powers conferred on the board under sections 1 to 220.11 19 do not in any way diminish or supersede the powers conferred 220.12 on the agency by Minnesota Statutes, chapters 115 to 116. 220.13 Sec. 20. [BANNING JUNCTION AREA WATER AND SANITARY SEWER 220.14 DISTRICT; DEFINITIONS.] 220.15 Subdivision 1. [APPLICATION.] For the purposes of sections 220.16 20 to 38, the terms defined in this section have the meanings 220.17 given them. 220.18 Subd. 2. [DISTRICT.] "Banning Junction area water and 220.19 sanitary sewer district" and "district" mean the area over which 220.20 the Banning Junction area water and sanitary sewer board has 220.21 jurisdiction, including the town of Finlayson and the city of 220.22 Finlayson in Pine county and Banning state park, but only that 220.23 part of the township described in the comprehensive plan adopted 220.24 by the board pursuant to section 24. 220.25 Subd. 3. [BOARD.] "Water and sanitary sewer board" or 220.26 "board" means the Banning Junction area water and sanitary sewer 220.27 board established for the district as provided in subdivision 2. 220.28 Subd. 4. [PERSON.] "Person" means an individual, 220.29 partnership, corporation, limited liability company, 220.30 cooperative, or other organization or entity, public or private. 220.31 Subd. 5. [LOCAL GOVERNMENTAL UNITS.] "Local governmental 220.32 units" or "governmental units" means the town of Finlayson, the 220.33 department of natural resources, and the city of Finlayson. 220.34 Subd. 6. [ACQUISITION; BETTERMENT.] "Acquisition" and 220.35 "betterment" have the meanings given in Minnesota Statutes, 220.36 chapter 475. 221.1 Subd. 7. [AGENCY.] "Agency" means the Minnesota pollution 221.2 control agency created in Minnesota Statutes, chapter 116. 221.3 Subd. 8. [SEWAGE.] "Sewage" means all liquid or 221.4 water-carried waste products from whatever sources derived, 221.5 together with any groundwater infiltration and surface water as 221.6 may be present. 221.7 Subd. 9. [POLLUTION OF WATER; SEWER SYSTEM.] "Pollution of 221.8 water" and "sewer system" have the meanings given in Minnesota 221.9 Statutes, section 115.01. 221.10 Subd. 10. [TREATMENT WORKS; DISPOSAL SYSTEM.] "Treatment 221.11 works" and "disposal system" have the meanings given in 221.12 Minnesota Statutes, section 115.01. 221.13 Subd. 11. [INTERCEPTOR.] "Interceptor" means a sewer and 221.14 its necessary appurtenances, including but not limited to mains, 221.15 pumping stations, and sewage flow-regulating and -measuring 221.16 stations, that is: 221.17 (1) designed for or used to conduct sewage originating in 221.18 more than one local governmental unit; 221.19 (2) designed or used to conduct all or substantially all 221.20 the sewage originating in a single local governmental unit from 221.21 a point of collection in that unit to an interceptor or 221.22 treatment works outside that unit; or 221.23 (3) determined by the board to be a major collector of 221.24 sewage used or designed to serve a substantial area in the 221.25 district. 221.26 Subd. 12. [DISTRICT DISPOSAL SYSTEM.] "District disposal 221.27 system" means any and all interceptors or treatment works owned, 221.28 constructed, or operated by the board unless designated by the 221.29 board as local water and sanitary sewer facilities. 221.30 Subd. 13. [MUNICIPALITY.] "Municipality" means any home 221.31 rule charter or statutory city or town. 221.32 Subd. 14. [TOTAL COSTS.] "Total costs of acquisition and 221.33 betterment" and "costs of acquisition and betterment" mean all 221.34 acquisition and betterment expenses permitted to be financed out 221.35 of stopped bond proceeds issued in accordance with section 32, 221.36 whether or not the expenses are in fact financed out of the bond 222.1 proceeds. 222.2 Subd. 15. [CURRENT COSTS.] "Current costs of acquisition, 222.3 betterment, and debt service" means interest and principal 222.4 estimated to be due during the budget year on bonds issued to 222.5 finance the acquisition and betterment and all other costs of 222.6 acquisition and betterment estimated to be paid during the year 222.7 from funds other than bond proceeds and federal or state grants. 222.8 Subd. 16. [RESIDENT.] "Resident" means the owner of a 222.9 dwelling located in the district and receiving water or sewer 222.10 service. 222.11 Sec. 21. [WATER AND SANITARY SEWER BOARD.] 222.12 Subdivision 1. [ESTABLISHMENT.] A water and sanitary sewer 222.13 district is established for the town of Finlayson, for the 222.14 Banning state park, under the jurisdiction of the Minnesota 222.15 department of natural resources, and for the city of Finlayson 222.16 in Pine county, to be known as the Banning Junction area water 222.17 and sanitary sewer district. The water and sewer district is 222.18 under the control and management of the Banning Junction area 222.19 water and sanitary sewer board. The board is established as a 222.20 public corporation and political subdivision of the state with 222.21 perpetual succession and all the rights, powers, privileges, 222.22 immunities, and duties that may be validly granted to or imposed 222.23 upon a municipal corporation, as provided in sections 20 to 38. 222.24 Subd. 2. [MEMBERS AND SELECTION.] The board is composed of 222.25 five members selected as follows: the town board shall meet to 222.26 appoint three members, one of whom shall be an elected township 222.27 officer, and two of whom shall be persons served by the system, 222.28 the city shall appoint one member, and the department of natural 222.29 resources shall appoint one member to the water and sanitary 222.30 sewer board and each board member shall have one vote. The 222.31 first terms must be as follows: one for one year, two for two 222.32 years, and two for three years, fixed by lot at the district's 222.33 first meeting. Thereafter, all terms are for three years. 222.34 Subd. 3. [TIME LIMITS FOR SELECTION.] The board members 222.35 must be selected as provided in subdivision 2 within 60 days 222.36 after sections 20 to 38 become effective. The successor to each 223.1 board member must be selected at any time within 60 days before 223.2 the expiration of the member's term in the same manner as the 223.3 predecessor was selected. A vacancy on the board must be filled 223.4 within 60 days after it occurs. 223.5 Subd. 4. [VACANCIES.] If the office of a board member 223.6 becomes vacant, the vacancy must be filled for the unexpired 223.7 term in the manner provided for selection of the member who 223.8 vacated the office. The office is deemed vacant under the 223.9 conditions specified in Minnesota Statutes, section 351.02. 223.10 Subd. 5. [REMOVAL.] A board member may be removed by the 223.11 unanimous vote of the governing body appointing the member, with 223.12 or without cause, or for malfeasance or nonfeasance in the 223.13 performance of official duties as provided by Minnesota 223.14 Statutes, sections 351.14 to 351.23. 223.15 Subd. 6. [CERTIFICATES OF SELECTION; OATH OF OFFICE.] A 223.16 certificate of selection of every board member selected under 223.17 subdivision 2 stating the term for which selected, must be made 223.18 by the respective town clerks, city administrator, and by the 223.19 commissioner of natural resources. The certificates, with the 223.20 approval appended by other authority, if required, must be filed 223.21 with the secretary of state. Counterparts thereof must be 223.22 furnished to the board member and the secretary of the board. 223.23 Each member shall qualify by taking and subscribing the oath of 223.24 office prescribed by the Minnesota Constitution, article V, 223.25 section 6. The oath, duly certified by the official 223.26 administering the same, must be filed with the secretary of 223.27 state and the secretary of the board. 223.28 Subd. 7. [BOARD MEMBERS' COMPENSATION.] Each board member, 223.29 except the chair, must be paid a per diem compensation of $35 223.30 for meetings and for other services as are specifically 223.31 authorized by the board, not to exceed $1,000 in any one year. 223.32 The chair must be paid a per diem compensation of $45 for 223.33 meetings and for other services specifically authorized by the 223.34 board, not to exceed $1,500 in any one year. All members of the 223.35 board must be reimbursed for all reasonable and necessary 223.36 expenses actually incurred in the performance of duties. 224.1 Sec. 22. [GENERAL PROVISIONS FOR ORGANIZATION AND 224.2 OPERATION OF BOARD.] 224.3 Subdivision 1. [ORGANIZATION; OFFICERS; MEETINGS; SEAL.] 224.4 After the selection and qualification of all board members, they 224.5 shall meet to organize the board at the call of any two board 224.6 members, upon seven days' notice by registered mail to the 224.7 remaining board members, at a time and place within the district 224.8 specified in the notice. A majority of the members shall 224.9 constitute a quorum at that meeting and all other meetings of 224.10 the board, but a lesser number may meet and adjourn from time to 224.11 time and compel the attendance of absent members. At the first 224.12 meeting the board shall select its officers and conduct other 224.13 organizational business as may be necessary. Thereafter the 224.14 board shall meet regularly at the time and place that the board 224.15 designates by resolution. Special meetings may be held at any 224.16 time upon call of the chair or any two members, upon written 224.17 notice sent by mail to each member at least three days before 224.18 the meeting, or upon other notice as the board by resolution may 224.19 provide, or without notice if each member is present or files 224.20 with the secretary a written consent to the meeting either 224.21 before or after the meeting. Except as otherwise provided in 224.22 sections 20 to 38, any action within the authority of the board 224.23 may be taken by the affirmative vote of a majority of the board 224.24 and may be taken by regular or adjourned regular meeting or at a 224.25 duly held special meeting, but in any case only if a quorum is 224.26 present. Meetings of the board must be open to the public. The 224.27 board may adopt a seal, which must be officially and judicially 224.28 noticed, to authenticate instruments executed by its authority, 224.29 but omission of the seal does not affect the validity of any 224.30 instrument. 224.31 Subd. 2. [CHAIR.] The board shall elect a chair from its 224.32 membership. The term of the first chair of the board shall 224.33 expire on January 1, 2001, and the terms of successor chairs 224.34 expire on January 1 of each succeeding year. The chair shall 224.35 preside at all meetings of the board, if present, and shall 224.36 perform all other duties and functions usually incumbent upon 225.1 such an officer, and all administrative functions assigned to 225.2 the chair by the board. The board shall elect a vice-chair from 225.3 its membership to act for the chair during temporary absence or 225.4 disability. 225.5 Subd. 3. [SECRETARY AND TREASURER.] The board shall select 225.6 a person or persons who may, but need not be, a member or 225.7 members of the board, to act as its secretary and treasurer. 225.8 The secretary and treasurer shall hold office at the pleasure of 225.9 the board, subject to the terms of any contract of employment 225.10 that the board may enter into with the secretary or treasurer. 225.11 The secretary shall record the minutes of all meetings of the 225.12 board, and be the custodian of all books and records of the 225.13 board except those that the board entrusts to the custody of a 225.14 designated employee. The treasurer is the custodian of all 225.15 money received by the board except as the board otherwise 225.16 entrusts to the custody of a designated employee. The board may 225.17 appoint a deputy to perform any and all functions of either the 225.18 secretary or the treasurer. A secretary or treasurer who is not 225.19 a member of the board or a deputy of either does not have the 225.20 right to vote. 225.21 Subd. 4. [EXECUTIVE DIRECTOR.] The board may appoint an 225.22 executive director, selected solely upon the basis of training, 225.23 experience, and other qualifications and who shall serve at the 225.24 pleasure of the board and at a compensation to be determined by 225.25 the board. The executive director need not be a resident of the 225.26 district. The executive director may also be selected by the 225.27 board to serve as either secretary or treasurer, or both, of the 225.28 board. The executive director shall attend all meetings of the 225.29 board, but shall not vote, and shall have the following powers 225.30 and duties: 225.31 (1) to see that all resolutions, rules, regulations, or 225.32 orders of the board are enforced; 225.33 (2) to appoint and remove, upon the basis of merit and 225.34 fitness, all subordinate officers and regular employees of the 225.35 board except the secretary and the treasurer and their deputies; 225.36 (3) to present to the board plans, studies, and other 226.1 reports prepared for board purposes and recommend to the board 226.2 for adoption the measures the executive director deems necessary 226.3 to enforce or carry out the powers and the duties of the board, 226.4 or the efficient administration of the affairs of the board; 226.5 (4) to keep the board fully advised as to its financial 226.6 condition, and to prepare and submit to the board and to the 226.7 governing bodies of the local governmental units, the board's 226.8 annual budget and other financial information the board may 226.9 request; 226.10 (5) to recommend to the board for adoption rules and 226.11 regulations the executive director deems necessary for the 226.12 efficient operation of the district disposal system; and 226.13 (6) to perform other duties prescribed by the board. 226.14 Subd. 5. [PUBLIC EMPLOYEES.] The executive director and 226.15 other persons employed by the district are public employees and 226.16 have all the rights and duties conferred on public employees 226.17 under Minnesota Statutes, sections 179A.01 to 179A.25. The 226.18 board may elect to have employees become members of either the 226.19 public employees retirement association or the Minnesota state 226.20 retirement system. The compensation and conditions of 226.21 employment of the employees must be governed by rules applicable 226.22 to state employees in the classified service and to the 226.23 provisions of Minnesota Statutes, chapter 15A. 226.24 Subd. 6. [PROCEDURES.] The board shall adopt resolutions 226.25 or bylaws establishing procedures for board action, personnel 226.26 administration, keeping records, approving claims, authorizing 226.27 or making disbursements, safekeeping funds, and auditing all 226.28 financial operations of the board. 226.29 Subd. 7. [SURETY BONDS AND INSURANCE.] The board may 226.30 procure surety bonds for its officers and employees, in amounts 226.31 deemed necessary to ensure proper performance of their duties 226.32 and proper accounting for funds in their custody. It may 226.33 procure insurance against risks to property and liability of the 226.34 board and its officers, agents, and employees for personal 226.35 injuries or death and property damage and destruction, in 226.36 amounts deemed necessary or desirable, with the force and effect 227.1 stated in Minnesota Statutes, chapter 466. 227.2 Sec. 23. [GENERAL POWERS OF BOARD.] 227.3 Subdivision 1. [SCOPE.] The board has all powers necessary 227.4 or convenient to discharge the duties imposed upon it by law. 227.5 The powers include those specified in this section, but the 227.6 express grant or enumeration of powers does not limit the 227.7 generality or scope of the grant of powers contained in this 227.8 subdivision. 227.9 Subd. 2. [SUIT.] The board may sue or be sued. 227.10 Subd. 3. [CONTRACT.] The board may enter into any contract 227.11 necessary or proper for the exercise of its powers or the 227.12 accomplishment of its purposes. 227.13 Subd. 4. [GIFTS, GRANTS, LOANS.] The board may accept 227.14 gifts, apply for and accept grants or loans of money or other 227.15 property from the United States, the state, or any person for 227.16 any of its purposes, enter into any agreement required in 227.17 connection with them, and hold, use, and dispose of the money or 227.18 property in accordance with the terms of the gift, grant, loan, 227.19 or agreement relating to it. With respect to loans or grants of 227.20 funds or real or personal property or other assistance from any 227.21 state or federal government or its agency or instrumentality, 227.22 the board may contract to do and perform all acts and things 227.23 required as a condition or consideration for the gift, grant, or 227.24 loan pursuant to state or federal law or regulations, whether or 227.25 not included among the powers expressly granted to the board in 227.26 sections 20 to 38. 227.27 Subd. 5. [COOPERATIVE ACTION.] The board may act under 227.28 Minnesota Statutes, section 471.59, or any other appropriate law 227.29 providing for joint or cooperative action between governmental 227.30 units. 227.31 Subd. 6. [STUDIES AND INVESTIGATIONS.] The board may 227.32 conduct research studies and programs, collect and analyze data, 227.33 prepare reports, maps, charts, and tables, and conduct all 227.34 necessary hearings and investigations in connection with the 227.35 design, construction, and operation of the district disposal 227.36 system. 228.1 Subd. 7. [EMPLOYEES, TERMS.] The board may employ on terms 228.2 it deems advisable, persons or firms performing engineering, 228.3 legal, or other services of a professional nature; require any 228.4 employee to obtain and file with it an individual bond or 228.5 fidelity insurance policy; and procure insurance in amounts it 228.6 deems necessary against liability of the board or its officers 228.7 or both, for personal injury or death and property damage or 228.8 destruction, with the force and effect stated in Minnesota 228.9 Statutes, chapter 466, and against risks of damage to or 228.10 destruction of any of its facilities, equipment, or other 228.11 property as it deems necessary. 228.12 Subd. 8. [PROPERTY RIGHTS, POWERS.] The board may acquire 228.13 by purchase, lease, condemnation, gift, or grant, any real or 228.14 personal property including positive and negative easements and 228.15 water and air rights, and it may construct, enlarge, improve, 228.16 replace, repair, maintain, and operate any interceptor, 228.17 treatment works, or water facility determined to be necessary or 228.18 convenient for the collection and disposal of sewage in the 228.19 district. Any local governmental unit and the commissioners of 228.20 transportation and natural resources are authorized to convey to 228.21 or permit the use of any of the above-mentioned facilities owned 228.22 or controlled by it, by the board, subject to the rights of the 228.23 holders of any bonds issued with respect to those facilities, 228.24 with or without compensation, without an election or approval by 228.25 any other governmental unit or agency. All powers conferred by 228.26 this subdivision may be exercised both within or without the 228.27 district as may be necessary for the exercise by the board of 228.28 its powers or the accomplishment of its purposes. The board may 228.29 hold, lease, convey, or otherwise dispose of the above-mentioned 228.30 property for its purposes upon the terms and in the manner it 228.31 deems advisable. Unless otherwise provided, the right to 228.32 acquire lands and property rights by condemnation may be 228.33 exercised only in accordance with Minnesota Statutes, sections 228.34 117.011 to 117.232, and shall apply to any property or interest 228.35 in the property owned by any local governmental unit. No 228.36 property devoted to an actual public use at the time, or held to 229.1 be devoted to such a use within a reasonable time, shall be so 229.2 acquired unless a court of competent jurisdiction determines 229.3 that the use proposed by the board is paramount to the existing 229.4 use. Except in the case of property in actual public use, the 229.5 board may take possession of any property on which condemnation 229.6 proceedings have been commenced at any time after the issuance 229.7 of a court order appointing commissioners for its condemnation. 229.8 Subd. 9. [RELATIONSHIP TO OTHER PROPERTIES.] The board may 229.9 construct or maintain its systems or facilities in, along, on, 229.10 under, over, or through public waters, streets, bridges, 229.11 viaducts, and other public rights-of-way without first obtaining 229.12 a franchise from a county or municipality having jurisdiction 229.13 over them. However, the facilities must be constructed and 229.14 maintained in accordance with the ordinances and resolutions of 229.15 the county or municipality relating to constructing, installing, 229.16 and maintaining similar facilities on public properties and must 229.17 not unnecessarily obstruct the public use of those rights-of-way. 229.18 Subd. 10. [DISPOSAL OF PROPERTY.] The board may sell, 229.19 lease, or otherwise dispose of any real or personal property 229.20 acquired by it which is no longer required for accomplishment of 229.21 its purposes. The property may be sold in the manner provided 229.22 by Minnesota Statutes, section 469.065, insofar as practical. 229.23 The board may give notice of sale as it deems appropriate. When 229.24 the board determines that any property or any part of the 229.25 district disposal system acquired from a local governmental unit 229.26 without compensation is no longer required but is required as a 229.27 local facility by the governmental unit from which it was 229.28 acquired, the board may by resolution transfer it to that 229.29 governmental unit. 229.30 Subd. 11. [AGREEMENTS WITH OTHER GOVERNMENTAL UNITS.] The 229.31 board may contract with the United States or any agency thereof, 229.32 any state or agency thereof, or any regional public planning 229.33 body in the state with jurisdiction over any part of the 229.34 district, or any other municipal or public corporation, or 229.35 governmental subdivision or agency or political subdivision in 229.36 any state, for the joint use of any facility owned by the board 230.1 or such entity, for the operation by that entity of any system 230.2 or facility of the board, or for the performance on the board's 230.3 behalf of any service, including but not limited to planning, on 230.4 terms as may be agreed upon by the contracting parties. Unless 230.5 designated by the board as a local water and sanitary sewer 230.6 facility, any treatment works or interceptor jointly used, or 230.7 operated on behalf of the board, as provided in this 230.8 subdivision, is deemed to be operated by the board for purposes 230.9 of including those facilities in the district disposal system. 230.10 Sec. 24. [COMPREHENSIVE PLAN.] 230.11 Subdivision 1. [BOARD PLAN AND PROGRAM.] The board shall 230.12 adopt a comprehensive plan for the collection, treatment, and 230.13 disposal of sewage in the district for a designated period the 230.14 board deems proper and reasonable. The board shall prepare and 230.15 adopt subsequent comprehensive plans for the collection, 230.16 treatment, and disposal of sewage in the district for each 230.17 succeeding designated period as the board deems proper and 230.18 reasonable. The first plan, as modified by the board, and any 230.19 subsequent plan shall take into account the preservation and 230.20 best and most economic use of water and other natural resources 230.21 in the area; the preservation, use, and potential for use of 230.22 lands adjoining waters of the state to be used for the disposal 230.23 of sewage; and the impact the disposal system will have on 230.24 present and future land use in the area affected. The plans 230.25 shall include the general location of needed interceptors and 230.26 treatment works, a description of the area that is to be served 230.27 by the various interceptors and treatment works, a long-range 230.28 capital improvements program, and any other details as the board 230.29 deems appropriate. In developing the plans, the board shall 230.30 consult with persons designated for the purpose by governing 230.31 bodies of any governmental unit within the district to represent 230.32 the entities and shall consider the data, resources, and input 230.33 offered to the board by the entities and any planning agency 230.34 acting on behalf of one or more of the entities. Each plan, 230.35 when adopted, must be followed in the district and may be 230.36 revised as often as the board deems necessary. 231.1 Subd. 2. [COMPREHENSIVE PLANS; HEARING.] Before adopting 231.2 any subsequent comprehensive plan, the board shall hold a public 231.3 hearing on the proposed plan at a time and place in the district 231.4 that it selects. The hearing may be continued from time to 231.5 time. Not less than 45 days before the hearing, the board shall 231.6 publish notice of the hearing in a newspaper having general 231.7 circulation in the district, stating the date, time, and place 231.8 of the hearing, and the place where the proposed plan may be 231.9 examined by any interested person. At the hearing, all 231.10 interested persons must be permitted to present their views on 231.11 the plan. 231.12 Subd. 3. [GOVERNMENTAL UNIT PLANS AND PROGRAMS; 231.13 COORDINATION WITH BOARD'S RESPONSIBILITIES.] Once the board's 231.14 plan is adopted, no construction project involving the 231.15 construction of new sewers or other disposal facilities may be 231.16 undertaken by the local governmental unit unless its governing 231.17 body shall first find the project to be in accordance with the 231.18 governmental unit's comprehensive plan and program as approved 231.19 by the board. Before approval by the board of the comprehensive 231.20 plan and program of any local governmental unit in the district, 231.21 no water and sanitary sewer construction project may be 231.22 undertaken by the governmental unit unless approval of the 231.23 project is first secured from the board as to those features of 231.24 the project affecting the board's responsibilities as determined 231.25 by the board. 231.26 Sec. 25. [POWERS TO ISSUE OBLIGATIONS AND IMPOSE SPECIAL 231.27 ASSESSMENTS.] 231.28 The Banning Junction area water and sanitary sewer board, 231.29 in order to implement the powers granted under sections 20 to 38 231.30 to establish, maintain, and administer the Banning Junction area 231.31 water and sanitary sewer district, may issue obligations and 231.32 impose special assessments against benefited property within the 231.33 limits of the district benefited by facilities constructed under 231.34 sections 20 to 38 in the manner provided for local governments 231.35 by Minnesota Statutes, chapter 429. 231.36 Sec. 26. [SYSTEM EXPANSION; APPLICATION TO CITIES.] 232.1 The authority of the water and sanitary sewer board to 232.2 establish water or sewer or combined water and sewer systems 232.3 under this section extends to areas within the Banning Junction 232.4 area water and sanitary sewer district organized into cities 232.5 when requested by resolution of the governing body of the 232.6 affected city or when ordered by the Minnesota pollution control 232.7 agency after notice and hearing. For the purpose of any 232.8 petition filed or special assessment levied with respect to any 232.9 system, the entire area to be served within a city must be 232.10 treated as if it were owned by a single person, and the 232.11 governing body shall exercise all the rights and be subject to 232.12 all the duties of an owner of the area, and shall have power to 232.13 provide for the payment of all special assessments and other 232.14 charges imposed upon the area with respect to the system by the 232.15 appropriation of money, the collection of service charges, or 232.16 the levy of taxes, which shall be subject to no limitation of 232.17 rate or amount. 232.18 Sec. 27. [SEWAGE COLLECTION AND DISPOSAL; POWERS.] 232.19 Subdivision 1. [POWERS.] In addition to all other powers 232.20 conferred upon the board in sections 20 to 38, it has the powers 232.21 specified in this section. 232.22 Subd. 2. [DISCHARGE OF TREATED SEWAGE.] The board may 232.23 discharge the effluent from any treatment works operated by it 232.24 into any waters of the state, subject to approval of the agency 232.25 if required and in accordance with any effluent or water quality 232.26 standards lawfully adopted by the agency, any interstate agency, 232.27 or any federal agency having jurisdiction. 232.28 Subd. 3. [UTILIZATION OF DISTRICT SYSTEM.] The board may 232.29 require any person or local governmental unit to provide for the 232.30 discharge of any sewage, directly or indirectly, into the 232.31 district disposal system, or to connect any disposal system or a 232.32 part of it with the district disposal system wherever reasonable 232.33 opportunity for connection is provided; may regulate the manner 232.34 in which the connections are made; may require any person or 232.35 local governmental unit discharging sewage into the disposal 232.36 system to provide preliminary treatment for it; may prohibit the 233.1 discharge into the district disposal system of any substance 233.2 that it determines will or may be harmful to the system or any 233.3 persons operating it; and may require any local governmental 233.4 unit to discontinue the acquisition, betterment, or operation of 233.5 any facility for the unit's disposal system wherever and so far 233.6 as adequate service is or will be provided by the district 233.7 disposal system. 233.8 Subd. 4. [SYSTEM OF COST RECOVERY TO COMPLY WITH 233.9 APPLICABLE REGULATIONS.] Any charges, connection fees, or other 233.10 cost-recovery techniques imposed on persons discharging sewage 233.11 directly or indirectly into the district disposal system must 233.12 comply with applicable state and federal law, including state 233.13 and federal regulations governing grant applications. 233.14 Sec. 28. [BUDGET.] 233.15 The board shall prepare and adopt, on or before October 1 233.16 in 1999 and each year thereafter, a budget showing for the 233.17 following calendar year or other fiscal year determined by the 233.18 board, sometimes referred to in sections 20 to 38 as the budget 233.19 year, estimated receipts of money from all sources, including 233.20 but not limited to payments by each local governmental unit, 233.21 federal or state grants, taxes on property, and funds on hand at 233.22 the beginning of the year, and estimated expenditures for: 233.23 (1) costs of operation, administration, and maintenance of 233.24 the district disposal system; 233.25 (2) cost of acquisition and betterment of the district 233.26 disposal system; and 233.27 (3) debt service, including principal and interest, on 233.28 general obligation bonds and certificates issued pursuant to 233.29 section 32, and any money judgments entered by a court of 233.30 competent jurisdiction. Expenditures within these general 233.31 categories, and any other categories as the board may from time 233.32 to time determine, must be itemized in detail as the board 233.33 prescribes. The board and its officers, agents, and employees 233.34 shall not spend money for any purpose other than debt service 233.35 without having set forth the expense in the budget nor in excess 233.36 of the amount set forth in the budget for it. No obligation to 234.1 make an expenditure of the above-mentioned type is enforceable 234.2 except as the obligation of the person or persons incurring it. 234.3 The board may amend the budget at any time by transferring from 234.4 one purpose to another any sums except money for debt service 234.5 and bond proceeds or by increasing expenditures in any amount by 234.6 which actual cash receipts during the budget year exceed the 234.7 total amounts designated in the original budget. The creation 234.8 of any obligation under section 32 or the receipt of any federal 234.9 or state grant is a sufficient budget designation of the 234.10 proceeds for the purpose for which it is authorized, and of the 234.11 tax or other revenue pledged to pay the obligation and interest 234.12 on it, whether or not specifically included in any annual budget. 234.13 Sec. 29. [ALLOCATION OF COSTS.] 234.14 Subdivision 1. [DEFINITION OF CURRENT COSTS.] The 234.15 estimated cost of administration, operation, maintenance, and 234.16 debt service of the district disposal system to be paid by the 234.17 board in each fiscal year and the estimated costs of acquisition 234.18 and betterment of the system that are to be paid during the year 234.19 from funds other than state or federal grants and bond proceeds 234.20 and all other previously unallocated payments made by the board 234.21 pursuant to sections 20 to 38 to be allocated in the fiscal year 234.22 are referred to as current costs and must be allocated by the 234.23 board as provided in subdivision 2 in the budget for that year. 234.24 Subd. 2. [METHOD OF ALLOCATION OF CURRENT COSTS.] Current 234.25 costs must be allocated in the district on an equitable basis as 234.26 the board may determine by resolution to be in the best 234.27 interests of the district. The adoption or revision of any 234.28 method of allocation used by the board must be by the 234.29 affirmative vote of at least two-thirds of the members of the 234.30 board. 234.31 Sec. 30. [TAX LEVIES.] 234.32 To accomplish any duty imposed on it the board may, in 234.33 addition to the powers granted in sections 20 to 38 and in any 234.34 other law or charter, exercise the powers granted any 234.35 municipality by Minnesota Statutes, chapters 117, 412, 429, 475, 234.36 sections 115.46, 444.075, and 471.59, with respect to the area 235.1 in the district. The board may levy taxes upon all taxable 235.2 property in the district for all or a part of the amount payable 235.3 to the board, pursuant to section 29, to be assessed and 235.4 extended as a tax upon that taxable property by the county 235.5 auditor for the next calendar year, free from any limitation of 235.6 rate or amount imposed by law or charter. The tax must be 235.7 collected and remitted in the same manner as other general taxes. 235.8 Sec. 31. [PUBLIC HEARING AND SPECIAL ASSESSMENTS.] 235.9 Subdivision 1. [PUBLIC HEARING REQUIREMENT ON SPECIFIC 235.10 PROJECT.] Before the board orders any project involving the 235.11 acquisition or betterment of any interceptor or treatment works, 235.12 all or a part of the cost of which will be allocated pursuant to 235.13 section 29 as current costs, the board shall hold a public 235.14 hearing on the proposed project. The hearing must be held 235.15 following two publications in a newspaper having general 235.16 circulation in the district, stating the time and place of the 235.17 hearing, the general nature and location of the project, the 235.18 estimated total cost of acquisition and betterment, that portion 235.19 of costs estimated to be paid out of federal and state grants, 235.20 and that portion of costs estimated to be allocated. The 235.21 estimates must be best available at the time of the meeting and 235.22 if costs exceed the estimate, the project cannot proceed until 235.23 an additional public hearing is held, with notice as required at 235.24 the initial meeting. The two publications must be a week apart 235.25 and the hearing at least three days after the last publication. 235.26 Not less than 45 days before the hearing, notice of the hearing 235.27 must also be mailed to each clerk of all local governmental 235.28 units in the district, but failure to give mailed notice or any 235.29 defects in the notice does not invalidate the proceedings. The 235.30 project may include all or part of one or more interceptors or 235.31 treatment works. No hearing may be held on any project unless 235.32 the project is within the area covered by the comprehensive plan 235.33 adopted by the board pursuant to section 24 except that the 235.34 hearing may be held simultaneously with a hearing on a 235.35 comprehensive plan. A hearing is not required with respect to a 235.36 project, no part of the costs of which are to be allocated as 236.1 the current costs of acquisition, betterment, and debt service. 236.2 Subd. 2. [NOTICE TO BENEFITED PROPERTY OWNERS.] If the 236.3 board proposes to assess against benefited property within the 236.4 district all or any part of the allocable costs of the project 236.5 as provided in subdivision 5, the board shall, not less than two 236.6 weeks before the hearing provided for in subdivision 1, cause 236.7 mailed notice of the hearing to be given to the owner of each 236.8 parcel within the area proposed to be specially assessed and 236.9 shall also give two weeks' published notice of the hearing. The 236.10 notice of hearing must contain the same information provided in 236.11 the notice published by the board pursuant to subdivision 1, and 236.12 a description of the area proposed to be assessed. For the 236.13 purpose of giving mailed notice, owners are those shown to be on 236.14 the records of the county auditor or, in any county where tax 236.15 statements are mailed by the county treasurer, on the records of 236.16 the county treasurer; but other appropriate records may be used 236.17 for this purpose. For properties that are tax exempt or subject 236.18 to taxation on a gross earnings basis and not listed on the 236.19 records of the county auditor or the county treasurer, the 236.20 owners must be ascertained by any practicable means and mailed 236.21 notice given them as herein provided. Failure to give mailed 236.22 notice or any defects in the notice does not invalidate the 236.23 proceedings of the board. 236.24 Subd. 3. [BOARD PROCEEDINGS PERTAINING TO HEARING.] Before 236.25 adoption of the resolution calling for a hearing under this 236.26 section, the board shall secure from the district engineer or 236.27 some other competent person of the board's selection a report 236.28 advising it in a preliminary way as to whether the proposed 236.29 project is feasible and whether it should be made as proposed or 236.30 in connection with some other project and the estimated costs of 236.31 the project as recommended. No error or omission in the report 236.32 invalidates the proceeding. The board may also take other steps 236.33 before the hearing, as will in its judgment provide helpful 236.34 information in determining the desirability and feasibility of 236.35 the project, including but not limited to preparation of plans 236.36 and specifications and advertisement for bids on them. The 237.1 hearing may be adjourned from time to time and a resolution 237.2 ordering the project may be adopted at any time within six 237.3 months after the date of hearing. In ordering the project the 237.4 board may reduce but not increase the extent of the project as 237.5 stated in the notice of hearing and shall find that the project 237.6 as ordered is in accordance with the comprehensive plan and 237.7 program adopted by the board pursuant to section 24. 237.8 Subd. 4. [EMERGENCY ACTION.] If the board by resolution 237.9 adopted by the affirmative vote of not less than two-thirds of 237.10 its members determines that an emergency exists requiring the 237.11 immediate purchase of materials or supplies or the making of 237.12 emergency repairs, it may order the purchase of those supplies 237.13 and materials and the making of the repairs before any hearing 237.14 required under this section, provided that the board shall set 237.15 as early a date as practicable for the hearing at the time it 237.16 declares the emergency. All other provisions of this section 237.17 must be followed in giving notice of and conducting the 237.18 hearing. Nothing herein may be construed as preventing the 237.19 board or its agents from purchasing maintenance supplies or 237.20 incurring maintenance costs without regard to the requirements 237.21 of this section. 237.22 Subd. 5. [POWER OF THE BOARD TO SPECIALLY ASSESS.] The 237.23 board may specially assess all or any part of the costs of 237.24 acquisition and betterment as herein provided, of any project 237.25 ordered pursuant to this section. The special assessments must 237.26 be levied in accordance with the provisions of Minnesota 237.27 Statutes, sections 429.051 to 429.081, except as otherwise 237.28 provided in this subdivision. No other provisions of Minnesota 237.29 Statutes, chapter 429, apply. For purposes of levying the 237.30 special assessments, the hearing on the project required in 237.31 subdivision 1 serves as the hearing on the making of the 237.32 original improvement provided for by Minnesota Statutes, section 237.33 429.051. The area assessed may be less than but may not exceed 237.34 the area proposed to be assessed as stated in the notice of 237.35 hearing on the project provided for in subdivision 2. 237.36 Sec. 32. [BONDS, CERTIFICATES, AND OTHER OBLIGATIONS.] 238.1 Subdivision 1. [BUDGET ANTICIPATION CERTIFICATES OF 238.2 INDEBTEDNESS.] At any time after adoption of its annual budget 238.3 and in anticipation of the collection of tax and other revenues 238.4 estimated and set forth by the board in the budget, except in 238.5 the case of deficiency taxes levied under this subdivision and 238.6 taxes levied for the payment of certificates issued under 238.7 subdivision 2, the board may, by resolution, authorize the 238.8 issuance, negotiation, and sale, in accordance with subdivision 238.9 4 in the form and manner and upon terms it determines, of its 238.10 negotiable general obligation certificates of indebtedness in 238.11 aggregate principal amounts not exceeding 50 percent of the 238.12 total amount of tax collections and other revenues, and maturing 238.13 not later than three months after the close of the budget year 238.14 in which issued. The proceeds of the sale of the certificates 238.15 must be used solely for the purposes for which the tax 238.16 collections and other revenues are to be expended pursuant to 238.17 the budget. 238.18 All the tax collections and other revenues included in the 238.19 budget for the budget year, after the expenditure of the tax 238.20 collections and other revenues in accordance with the budget, 238.21 must be irrevocably pledged and appropriated to a special fund 238.22 to pay the principal and interest on the certificates when due. 238.23 If for any reason the tax collections and other revenues are 238.24 insufficient to pay the certificates and interest when due, the 238.25 board shall levy a tax in the amount of the deficiency on all 238.26 taxable property in the district and shall appropriate this 238.27 amount when received to the special fund. 238.28 Subd. 2. [EMERGENCY CERTIFICATES OF INDEBTEDNESS.] If in 238.29 any budget year the receipts of tax and other revenues should 238.30 for some unforeseen cause become insufficient to pay the board's 238.31 current expenses, or if any public emergency should subject it 238.32 to the necessity of making extraordinary expenditures, the board 238.33 may by resolution authorize the issuance, negotiation, and sale, 238.34 in accordance with subdivision 4 in the form and manner and upon 238.35 the terms and conditions it determines, of its negotiable 238.36 general obligation certificates of indebtedness in an amount 239.1 sufficient to meet the deficiency. The board shall levy on all 239.2 taxable property in the district a tax sufficient to pay the 239.3 certificates and interest on the certificates and shall 239.4 appropriate all collections of the tax to a special fund created 239.5 for the payment of the certificates and the interest on them. 239.6 Certificates issued under this subdivision mature not later than 239.7 April 1 in the year following the year in which the tax is 239.8 collectible. 239.9 Subd. 3. [GENERAL OBLIGATION BONDS.] The board may by 239.10 resolution authorize the issuance of general obligation bonds 239.11 for the acquisition or betterment of any part of the district 239.12 disposal system, including but without limitation the payment of 239.13 interest during construction and for a reasonable period 239.14 thereafter, or for the refunding of outstanding bonds, 239.15 certificates of indebtedness, or judgments. The board shall 239.16 pledge its full faith and credit and taxing power for the 239.17 payment of the bonds and shall provide for the issuance and sale 239.18 and for the security of the bonds in the manner provided in 239.19 Minnesota Statutes, chapter 475. The board has the same powers 239.20 and duties as a municipality issuing bonds under that law, 239.21 except that no election is required and the debt limitations of 239.22 Minnesota Statutes, chapter 475, do not apply to the bonds. The 239.23 board may also pledge for the payment of the bonds and deduct 239.24 from the amount of any tax levy required under Minnesota 239.25 Statutes, section 475.61, subdivision 1, and any revenues 239.26 receivable under any state and federal grants anticipated by the 239.27 board and may covenant to refund the bonds if and when and to 239.28 the extent that for any reason the revenues, together with other 239.29 funds available and appropriated for that purpose, are not 239.30 sufficient to pay all principal and interest due or about to 239.31 become due, provided that the revenues have not been anticipated 239.32 by the issuance of certificates under subdivision 1. 239.33 Subd. 4. [MANNER OF SALE AND ISSUANCE OF CERTIFICATES.] 239.34 Certificates issued under subdivisions 1 and 2 may be issued and 239.35 sold by negotiation, without public sale, and may be sold at a 239.36 price equal to the percentage of the par value of the 240.1 certificates, plus accrued interest, and bearing interest at the 240.2 rate determined by the board. No election is required to 240.3 authorize the issuance of the certificates. The certificates 240.4 must bear the same rate of interest after maturity as before and 240.5 the full faith and credit and taxing power of the board must be 240.6 pledged to the payment of the certificates. 240.7 Sec. 33. [DEPOSITORIES.] 240.8 The board shall designate one or more national or state 240.9 banks, or trust companies authorized to do a banking business, 240.10 as official depositories for money of the board, and shall 240.11 require the treasurer to deposit all or a part of the money in 240.12 those institutions. The designation must be in writing and must 240.13 set forth all the terms and conditions upon which the deposits 240.14 are made, and must be signed by the chair and treasurer and made 240.15 a part of the minutes of the board. 240.16 Sec. 34. [MONEY, ACCOUNTS, AND INVESTMENTS.] 240.17 Subdivision 1. [RECEIPT AND APPLICATION.] Money received 240.18 by the board must be deposited or invested by the treasurer and 240.19 disposed of as the board may direct in accordance with its 240.20 budget; provided that any money that has been pledged or 240.21 dedicated by the board to the payment of obligations or interest 240.22 on the obligations or expenses incident thereto, or for any 240.23 other specific purpose authorized by law, must be paid by the 240.24 treasurer into the fund to which it has been pledged. 240.25 Subd. 2. [FUNDS AND ACCOUNTS.] (a) The board's treasurer 240.26 shall establish funds and accounts as may be necessary or 240.27 convenient to handle the receipts and disbursements of the board 240.28 in an orderly fashion. 240.29 (b) The funds and accounts must be audited annually by a 240.30 certified public accountant at the expense of the district. 240.31 Subd. 3. [DEPOSIT AND INVESTMENT.] The money on hand in 240.32 those funds and accounts may be deposited in the official 240.33 depositories of the board or invested as provided in this 240.34 subdivision. Any amount not currently needed or required by law 240.35 to be kept in cash on deposit may be invested in obligations 240.36 authorized for the investment of municipal sinking funds by 241.1 Minnesota Statutes, section 118A.04. The money may also be held 241.2 under certificates of deposit issued by any official depository 241.3 of the board. 241.4 Subd. 4. [BOND PROCEEDS.] The use of proceeds of all bonds 241.5 issued by the board for the acquisition and betterment of the 241.6 district disposal system, and the use, other than investment, of 241.7 all money on hand in any sinking fund or funds of the board, is 241.8 governed by the provisions of Minnesota Statutes, chapter 475, 241.9 the provisions of sections 20 to 38, and the provisions of 241.10 resolutions authorizing the issuance of the bonds. When 241.11 received, the bond proceeds must be transferred to the treasurer 241.12 of the board for safekeeping, investment, and payment of the 241.13 costs for which they were issued. 241.14 Subd. 5. [AUDIT.] The board shall provide for and pay the 241.15 cost of an independent annual audit of its official books and 241.16 records by the state auditor or a public accountant authorized 241.17 to perform that function under Minnesota Statutes, chapter 6. 241.18 Sec. 35. [SERVICE CONTRACTS WITH GOVERNMENTAL ENTITIES 241.19 OUTSIDE THE JURISDICTION OF THE BOARD.] 241.20 (a) The board may contract with the United States or any 241.21 agency of the federal government, any state or its agency, or 241.22 any municipal or public corporation, governmental subdivision or 241.23 agency or political subdivision in any state, outside the 241.24 jurisdiction of the board, for furnishing services to those 241.25 entities, including but not limited to planning for and the 241.26 acquisition, betterment, operation, administration, and 241.27 maintenance of any or all interceptors, treatment works, and 241.28 local water and sanitary sewer facilities. The board may 241.29 include as one of the terms of the contract that the entity must 241.30 pay to the board an amount agreed upon as a reasonable estimate 241.31 of the proportionate share properly allocable to the entity of 241.32 costs of acquisition, betterment, and debt service previously 241.33 allocated in the district. When payments are made by entities 241.34 to the board, they must be applied in reduction of the total 241.35 amount of costs thereafter allocated in the district, on an 241.36 equitable basis as the board deems to be in the best interests 242.1 of the district, applying so far as practicable and appropriate 242.2 the criteria set forth in section 29, subdivision 2. A 242.3 municipality in the state of Minnesota may enter into a contract 242.4 and perform all acts and things required as a condition or 242.5 consideration therefor consistent with the purposes of sections 242.6 20 to 38, whether or not included among the powers otherwise 242.7 granted to the municipality by law or charter. 242.8 (b) The board shall contract with a qualified entity to 242.9 make necessary inspections on the district facilities, and to 242.10 otherwise process or assist in processing any of the work of the 242.11 district. 242.12 Sec. 36. [CONTRACTS FOR CONSTRUCTION, MATERIALS, SUPPLIES, 242.13 AND EQUIPMENT.] 242.14 When the board orders a project involving the acquisition 242.15 or betterment of a part of the district disposal system, it 242.16 shall cause plans and specifications of the project to be made, 242.17 or if previously made, to be modified, if necessary, and to be 242.18 approved by the agency if required, and after any required 242.19 approval by the agency, one or more contracts for work and 242.20 materials called for by the plans and specification may be 242.21 awarded as provided in Minnesota Statutes, section 471.345. 242.22 Sec. 37. [PROPERTY EXEMPT FROM TAXATION.] 242.23 Any properties, real or personal, owned, leased, 242.24 controlled, used, or occupied by the water and sanitary sewer 242.25 board for any purpose under sections 20 to 38 are declared to be 242.26 acquired, owned, leased, controlled, used, and occupied for 242.27 public, governmental, and municipal purposes, and are exempt 242.28 from taxation by the state or any political subdivision of the 242.29 state, provided that the properties are subject to special 242.30 assessments levied by a political subdivision for a local 242.31 improvement in amounts proportionate to and not exceeding the 242.32 special benefit received by the properties from the 242.33 improvement. No possible use of any properties in any manner 242.34 different from their use as part of a disposal system at the 242.35 time may be considered in determining the special benefit 242.36 received by the properties. All assessments are subject to 243.1 final approval by the board, whose determination of the benefits 243.2 is conclusive upon the political subdivision levying the 243.3 assessment. 243.4 Sec. 38. [RELATION TO EXISTING LAWS.] 243.5 The provisions of sections 20 to 38 must be given full 243.6 effect notwithstanding the provisions of any law or charter 243.7 inconsistent with sections 20 to 38. The powers conferred on 243.8 the board under sections 20 to 38 do not in any way diminish or 243.9 supersede the powers conferred on the agency by Minnesota 243.10 Statutes, chapters 115 to 116. 243.11 Sec. 39. [EFFECTIVE DATE; REVERSE REFERENDUM.] 243.12 Prior to approval by resolution by each of the local 243.13 governing bodies of the city of New Prague, and Helena and Cedar 243.14 Lake townships, under Minnesota Statutes, section 645.021, 243.15 subdivision 2, each city or township shall publish a notice of 243.16 its intention to establish the district in a newspaper of 243.17 general circulation in the city or township, together with a 243.18 date for a public hearing. The hearing must be held at least 243.19 two weeks but not more than four weeks after the publication of 243.20 the resolution. Following the public hearing, the city or 243.21 township may determine to take no further action or adopt a 243.22 resolution confirming its intention to establish the district. 243.23 That resolution must also be published in a newspaper of general 243.24 circulation in the district. If within 30 days after 243.25 publication of the resolution, a petition signed by at least 243.26 five percent of the registered voters in the city or township 243.27 requesting a vote on the proposed resolution is filed with the 243.28 county auditor, the resolution is not effective until it has 243.29 been submitted to the voters in the city or township at a 243.30 general or special election and a majority of votes cast on the 243.31 question of approving the resolution are in the affirmative. 243.32 The commissioner of revenue shall prepare a suggested form of 243.33 question to be presented at the election. If the majority of 243.34 the votes are cast in the affirmative or if no reverse referenda 243.35 are held, sections 1 to 19 are effective the day after a 243.36 certificate of approval under Minnesota Statutes, section 244.1 645.021, subdivision 3, is filed by the last of the four local 244.2 governmental units subject to sections 1 to 19. 244.3 Prior to approval by resolution by each of the local 244.4 governing bodies of the city and town of Finlayson, under 244.5 Minnesota Statutes, section 645.021, subdivision 2, the city or 244.6 town shall publish a notice of its intention to establish the 244.7 district in a newspaper of general circulation in the city or 244.8 town, together with a date for a public hearing. The hearing 244.9 must be held at least two weeks but not more than four weeks 244.10 after the publication of the resolution. Following the public 244.11 hearing, the city or town may determine to take no further 244.12 action or adopt a resolution confirming its intention to 244.13 establish the district. That resolution must also be published 244.14 in a newspaper of general circulation in the district. If 244.15 within 30 days after publication of the resolution, a petition 244.16 signed by at least five percent of the registered voters in the 244.17 city or town requesting a vote on the proposed resolution is 244.18 filed with the county auditor, the resolution is not effective 244.19 until it has been submitted to the voters in the city or town at 244.20 a general or special election and a majority of votes cast on 244.21 the question of approving the resolution are in the affirmative. 244.22 The commissioner of revenue shall prepare a suggested form of 244.23 question to be presented at the election. If the majority of 244.24 the votes are cast in the affirmative or if no reverse referenda 244.25 are held, sections 20 to 38 are effective as to the city and the 244.26 town of Finlayson separately the day after the certificate of 244.27 approval of the governing body of each is filed as provided in 244.28 Minnesota Statutes, section 645.021, subdivision 3. 244.29 ARTICLE 15 244.30 AUTOMATIC REBATE IN ENACTED BUDGET 244.31 Section 1. [16A.1522] [REBATE REQUIREMENTS.] 244.32 Subdivision 1. [FORECAST.] If, on the basis of a forecast 244.33 of general fund revenues and expenditures in November of an 244.34 even-numbered year or February of an odd-numbered year, the 244.35 commissioner projects a positive unrestricted budgetary general 244.36 fund balance at the close of the biennium that exceeds one-half 245.1 of one percent of total general fund biennial revenues, the 245.2 commissioner shall designate the entire balance as available for 245.3 rebate to the taxpayers of this state. In forecasting, 245.4 projecting, or designating the unrestricted budgetary general 245.5 fund balance or general fund biennial revenue under this 245.6 section, the commissioner shall not include any balance or 245.7 revenue attributable to settlement payments received after July 245.8 1, 1998, as defined in Section IIB of the settlement document, 245.9 filed May 18, 1998, in State v. Philip Morris, Inc., No. 245.10 C1-94-8565 (Minnesota District Court, Second Judicial District). 245.11 Subd. 2. [PLAN.] If the commissioner designates an amount 245.12 for rebate in either forecast, the governor shall present a plan 245.13 to the legislature for rebating that amount. The plan must 245.14 provide for payments to begin no later than August 15 of the 245.15 odd-numbered year. By April 15 of each odd-numbered year, the 245.16 legislature shall enact, modify, or reject the plan presented by 245.17 the governor. 245.18 Subd. 3. [CERTIFICATION.] By July 15 of each odd-numbered 245.19 year, based on a preliminary analysis of the general fund 245.20 balance at the end of the fiscal year June 30, the commissioner 245.21 of finance shall certify to the commissioner of revenue the 245.22 amount available for rebate. 245.23 Subd. 4. [TRANSFER TO TAX RELIEF ACCOUNT.] Any positive 245.24 unrestricted budgetary general fund balance on June 30 of an 245.25 odd-numbered year is appropriated to the commissioner for 245.26 transfer to the tax relief account. 245.27 Subd. 5. [APPROPRIATION.] A sum sufficient to pay any 245.28 rebate due under the plan enacted under subdivision 2 is 245.29 appropriated from the general fund to the commissioner of 245.30 revenue. 245.31 Sec. 2. [ABOLISHING TAX REFORM AND REDUCTION ACCOUNT.] 245.32 The tax reform and reduction account created in Laws 1998, 245.33 chapter 389, article 9, section 2, subdivision 2, clause (2), is 245.34 abolished. The balance in the account shall revert to the 245.35 unrestricted general fund balance. 245.36 Sec. 3. [EFFECTIVE DATE.] 246.1 Section 1 is effective September 1, 1999. Section 2 is 246.2 effective the day following final enactment. 246.3 ARTICLE 16 246.4 MISCELLANEOUS 246.5 Section 1. Minnesota Statutes 1998, section 256.969, is 246.6 amended by adding a subdivision to read: 246.7 Subd. 9c. [COUNTY BILLING.] Hospitals that have a medical 246.8 assistance disproportionate population adjustment greater than 246.9 eight percent shall be eligible for a special payment for 246.10 uncompensated care. These hospitals may bill a county of 246.11 residence for services provided to a resident of that county 246.12 provided that: 246.13 (1) the patient is a resident of a county other than the 246.14 county in which the hospital is located; and 246.15 (2) the hospital has made a preliminary determination at 246.16 the time service is delivered that: 246.17 (i) the patient is not eligible for any public health care 246.18 program or it cannot be determined whether the person is 246.19 eligible for any public health care program; 246.20 (ii) the person is uninsured or it cannot be determined if 246.21 the person is uninsured; and 246.22 (iii) the person has insufficient resources to pay the cost 246.23 of services delivered by the hospital. 246.24 Counties that are billed under this program must pay 246.25 eligible hospitals at the rates established under the medical 246.26 assistance program. If the county can establish eligibility for 246.27 a public health care program after the service has been 246.28 delivered, the hospital shall refund any amount received from 246.29 the county and shall bill the program for which eligibility has 246.30 been established. Annually, each eligible hospital shall sum 246.31 the amount collected from each county. If this sum is less than 246.32 $10,000, the hospital shall refund this sum to the county. 246.33 Sec. 2. [256B.053] [COUNTY BILLING BY CLINICS.] 246.34 Clinics that: (1) serve the primary health care needs of 246.35 low-income population groups; (2) use a sliding fee scale based 246.36 on ability to pay and do not limit access to care because of 247.1 financial limitations of the client; and (3) are nonprofit under 247.2 chapter 317, or are federally qualified health centers, shall be 247.3 eligible for a special payment for uncompensated care. The 247.4 clinics may bill a county of residence for services provided to 247.5 a resident of that county provided that: 247.6 (1) the patient is a resident of a county other than the 247.7 county in which the clinic is located; and 247.8 (2) the clinic has made a preliminary determination at the 247.9 time service is delivered that: 247.10 (i) the patient is not eligible for any public health care 247.11 program or it cannot be determined whether the person is 247.12 eligible for any public health care program; 247.13 (ii) the person is uninsured or it cannot be determined if 247.14 the person is uninsured; and 247.15 (iii) the person has insufficient resources to pay the cost 247.16 of services delivered by the clinic. 247.17 Counties that are billed under this program shall pay 247.18 eligible clinics at the rates established under the medical 247.19 assistance program. If the county can establish eligibility for 247.20 a public health care program after service has been delivered, 247.21 the clinic shall refund any amount received from the county and 247.22 shall bill the program for which eligibility has been 247.23 established. Annually, each eligible clinic shall sum the 247.24 amount collected from each county. If this sum is less than 247.25 $10,000, the clinic shall refund this sum to the county. 247.26 Sec. 3. Minnesota Statutes 1998, section 270.65, is 247.27 amended to read: 247.28 270.65 [DATE OF ASSESSMENT; DEFINITION.] 247.29 For purposes of taxes administered by the commissioner, the 247.30 term "date of assessment" means the date a return was filed or 247.31 the date a return should have been filed, whichever is later; 247.32 or, in the case of taxes determined by the commissioner, "date 247.33 of assessment" means the date of the order assessing taxes; or, 247.34 in the case of an amended return filed by the taxpayer, the 247.35 assessment date is the date the return was filed with the 247.36 commissioner; or, in the case of a check from a taxpayer that is 248.1 dishonored and results in an erroneous refund being given to the 248.2 taxpayer, remittance of the check is deemed to be an assessment 248.3 and the "date of assessment" is the date the check was received 248.4 by the commissioner. 248.5 Sec. 4. Minnesota Statutes 1998, section 270.78, is 248.6 amended to read: 248.7 270.78 [PENALTY FOR FAILURE TO MAKE PAYMENT BY ELECTRONIC 248.8 FUNDS TRANSFER.] 248.9(a)In addition to other applicable penalties imposed by 248.10 law, after notification from the commissioner of revenue to the 248.11 taxpayer that payments for a tax administered by the 248.12 commissioner are required to be made by means of electronic 248.13 funds transfer, and the payments are remitted by some other 248.14 means, there is a penalty in the amount of five percent of each 248.15 payment that should have been remitted electronically. The 248.16 penalty can be abated under the abatement procedures prescribed 248.17 in section 270.07, subdivision 6, if the failure to remit the 248.18 payment electronically is due to reasonable cause. The penalty 248.19 bears interest at the rate specified in section 270.75 from the 248.20 due date of the payment of the tax to the date of payment of the 248.21 penalty. 248.22(b) The penalty under paragraph (a) does not apply if the248.23taxpayer pays by other means the amount due at least three248.24business days before the date the payment is due. This248.25paragraph does not apply after December 31, 1997.248.26 Sec. 5. Minnesota Statutes 1998, section 270A.03, 248.27 subdivision 2, is amended to read: 248.28 Subd. 2. [CLAIMANT AGENCY.] "Claimant agency" means any 248.29 state agency, as defined by section 14.02, subdivision 2, the 248.30 regents of the University of Minnesota, any district court of 248.31 the state, any county, any statutory or home rule charter city 248.32 presenting a claim for a municipal hospital or a public library, 248.33 a hospital district, a private nonprofit hospital that leases 248.34 its building from the county in which it is located, any public 248.35 agency responsible for child support enforcement, any public 248.36 agency responsible for the collection of court-ordered 249.1 restitution, and any public agency established by general or 249.2 special law that is responsible for the administration of a 249.3 low-income housing program. 249.4 Sec. 6. Minnesota Statutes 1998, section 270A.07, 249.5 subdivision 2, is amended to read: 249.6 Subd. 2. [SETOFF PROCEDURES.] (a) The commissioner, upon 249.7 receipt of notification, shall initiate procedures to detect any 249.8 refunds otherwise payable to the debtor. When the commissioner 249.9 determines that a refund is due to a debtor whose debt was 249.10 submitted by a claimant agency, the commissioner shall first 249.11 deduct the fee in subdivision 1 and then remit the refund or the 249.12 amount claimed, whichever is less, to the agency. In 249.13 transferring or remitting moneys to the claimant agency, the 249.14 commissioner shall provide information indicating the amount 249.15 applied against each debtor's obligation and the debtor's 249.16 address listed on the tax return. 249.17 (b) The commissioner shall remit to the debtor the amount 249.18 of any refund due in excess of the debt submitted for setoff by 249.19 the claimant agency. Notice of the amount setoff and address of 249.20 the claimant agency shall accompany any disbursement to the 249.21 debtor of the balance of a refund. The notice shall also advise 249.22 the debtor of the right to contest the validity of the claim, 249.23 other than a claim based upon child support under section 249.24 518.171, 518.54, 518.551, or chapter 518C at a hearing, subject 249.25 to the restrictions in this paragraph. The debtor must assert 249.26 this right by written request to the claimant agency, which 249.27 request the claimant agency must receive within 45 days of the 249.28 date of the notice. This right does not apply to (1) issues 249.29 relating to the validity of the claim that have been previously 249.30 raised at a hearing under this section or section 270A.09; (2) 249.31 issues relating to the validity of the claim that were not 249.32 timely raised by the debtor under section 270A.08, subdivision 249.33 2;or(3) issues relating to the validity of the claim that have 249.34 been previously raised at a hearing conducted under rules 249.35 promulgated by the United States Department of Housing and Urban 249.36 Development or any public agency that is responsible for the 250.1 administration of a low-income housing program, or that were not 250.2 timely raised by the debtor under those rules; or (4) issues 250.3 relating to the validity of the claim for which a hearing is 250.4 discretionary under section 270A.09. 250.5 Sec. 7. Minnesota Statutes 1998, section 270A.08, 250.6 subdivision 2, is amended to read: 250.7 Subd. 2. [REQUIREMENTS OF NOTICE.] (a) This written notice 250.8 shall clearly and with specificity set forth the basis for the 250.9 claim to the refund including the name of the benefit program 250.10 involved if the debt arises from a public assistance grant and 250.11 the dates on which the debt was incurred and, further, shall 250.12 advise the debtor of the claimant agency's intention to request 250.13 setoff of the refund against the debt. 250.14 (b) Except as provided in paragraph (c), the notice will 250.15 also advise the debtor that the debt can be setoff against a 250.16 refund unless the time period allowed by law for collecting the 250.17 debt has expired, and will advise the debtor of the right to 250.18 contest the validity of the claim at a hearing. The debtor must 250.19 assert this right by written request to the claimant agency, 250.20 which request the agency must receive within 45 days of the 250.21 mailing date of the original notice or of the corrected notice, 250.22 as required by subdivision 1. If the debtor has not received 250.23 the notice, the 45 days shall not commence until the debtor has 250.24 received actual notice. The debtor shall have the burden of 250.25 showing no notice and shall be entitled to a hearing on the 250.26 issue of notice as well as on the merits. 250.27 (c) If the claimant agency is a public agency that is 250.28 responsible for the administration of a low-income housing 250.29 program, the notice will also advise the debtor that the debt 250.30 can be set off against a refund unless the time period allowed 250.31 by law for collecting the debt has expired. If the public 250.32 agency has provided the debtor with the opportunity to contest 250.33 the issues relating to the validity of the claim at a hearing 250.34 under rules promulgated by the United States Department of 250.35 Housing and Urban Development or the public agency, the notice 250.36 will advise the debtor of that fact and advise the debtor that 251.1 no further hearing may be requested by the debtor to contest the 251.2 validity of the claim. 251.3 Sec. 8. Minnesota Statutes 1998, section 289A.31, 251.4 subdivision 2, is amended to read: 251.5 Subd. 2. [JOINT INCOME TAX RETURNS.] (a) If a joint income 251.6 tax return is made by a husband and wife, the liability for the 251.7 tax is joint and several. A spouse whois relieved ofqualifies 251.8 for relief from a liability attributable toa substantialan 251.9 underpayment under section6013(e)6015(b) of the Internal 251.10 Revenue Code isalsorelieved of the state income tax liability 251.11 on thesubstantialunderpayment. 251.12 (b) In the case of individuals who were a husband and wife 251.13 prior to the dissolution of their marriage or their legal 251.14 separation, or prior to the death of one of the individuals, for 251.15 tax liabilities reported on a joint or combined return, the 251.16 liability of each person is limited to the proportion of the tax 251.17 due on the return that equals that person's proportion of the 251.18 total tax due if the husband and wife filed separate returns for 251.19 the taxable year. This provision is effective only when the 251.20 commissioner receives written notice of the marriage 251.21 dissolution, legal separation, or death of a spouse from the 251.22 husband or wife. No refund may be claimed by an ex-spouse, 251.23 legally separated or widowed spouse for any taxes paid more than 251.24 60 days before receipt by the commissioner of the written notice. 251.25 Sec. 9. Minnesota Statutes 1998, section 289A.40, 251.26 subdivision 1a, is amended to read: 251.27 Subd. 1a. [INDIVIDUAL INCOME TAXES;REASONABLE251.28CAUSESUSPENSION DURING PERIOD OF DISABILITY.] If the 251.29 taxpayerestablishes reasonable cause for failing to timely file251.30the return required by section 289A.08, subdivision 1, files the251.31required return within ten years of the date specified in251.32section 289A.18, subdivision 1, and independently verifies that251.33an overpayment has been made, the commissioner shall grant a251.34refund claimed by the original return, notwithstanding the251.35limitations of subdivision 1meets the requirements for 251.36 suspending the running of the time period to file a claim for 252.1 refund under section 6511(h) of the Internal Revenue Code, the 252.2 time period in subdivision 1 for the taxpayer to file a claim 252.3 for an individual income tax refund is suspended. 252.4 Sec. 10. Minnesota Statutes 1998, section 289A.50, 252.5 subdivision 7, is amended to read: 252.6 Subd. 7. [REMEDIES.] (a) If the taxpayer is notified by 252.7 the commissioner that the refund claim is denied in whole or in 252.8 part, the taxpayer may: 252.9 (1) file an administrative appeal as provided in section 252.10 289A.65, or an appeal with the tax court, within 60 days after 252.11 issuance of the commissioner's notice of denial; or 252.12 (2) file an action in the district court to recover the 252.13 refund. 252.14 (b) An action in the district court on a denied claim for 252.15 refund must be brought within 18 months of the date of the 252.16 denial of the claim by the commissioner. 252.17 (c) No action in the district court or the tax court shall 252.18 be brought within six months of the filing of the refund claim 252.19 unless the commissioner denies the claim within that period. 252.20 (d) If a taxpayer files a claim for refund and the 252.21 commissioner has not issued a denial of the claim, the taxpayer 252.22 may bring an action in the district court or the tax court at 252.23 any time after the expiration of six months of the time the 252.24 claim was filed, but within four years of the date that the252.25claim was filed. 252.26 (e) The commissioner and the taxpayer may agree to extend 252.27 the period for bringing an action in the district court. 252.28 (f) An action for refund of tax by the taxpayer must be 252.29 brought in the district court of the district in which lies the 252.30 county of the taxpayer's residence or principal place of 252.31 business. In the case of an estate or trust, the action must be 252.32 brought at the principal place of its administration. Any 252.33 action may be brought in the district court for Ramsey county. 252.34 Sec. 11. Minnesota Statutes 1998, section 289A.55, 252.35 subdivision 9, is amended to read: 252.36 Subd. 9. [INTEREST ON PENALTIES.] (a) A penalty imposed 253.1 under section 289A.60, subdivision 1, 2, 3, 4, 5,or6, or 21 253.2 bears interest from the date the return or payment was required 253.3 to be filed or paid, including any extensions, to the date of 253.4 payment of the penalty. 253.5 (b) A penalty not included in paragraph (a) bears interest 253.6 only if it is not paid within ten days from the date of notice. 253.7 In that case interest is imposed from the date of notice to the 253.8 date of payment. 253.9 Sec. 12. [414.12] [DIRECTOR'S POWERS.] 253.10 Notwithstanding anything to the contrary in sections 414.01 253.11 to 414.11, the director of the office of strategic and 253.12 long-range planning, upon consultation with affected parties and 253.13 considering the procedures and principles established in 253.14 sections 414.01 to 414.11, and Laws 1997, chapter 202, article 253.15 4, sections 1 to 13, may require alternative dispute resolution 253.16 processes, including those provided in chapter 14, in the 253.17 execution of the office's duties under this chapter. 253.18 Sec. 13. Minnesota Statutes 1998, section 475.58, is 253.19 amended by adding a subdivision to read: 253.20 Subd. 3a. [YOUTH ICE FACILITIES.] A municipality may, 253.21 without regard to the election requirement under subdivision 1 253.22 or under any other provision of law or home rule charter, issue 253.23 and sell obligations to refund existing debt of an indoor ice 253.24 arena that is used predominantly for youth athletic activity if 253.25 all the following conditions are met: 253.26 (1) the obligations are secured by a pledge of revenues 253.27 from the facility; and 253.28 (2) the governing body of the municipality finds, based on 253.29 analysis provided by a professional experienced in finance, that 253.30 the facility's revenues and other available money will be 253.31 sufficient to pay the obligations, without reliance on a 253.32 property tax levy or the municipality's general purpose state 253.33 aid. 253.34 Sec. 14. Laws 1997, First Special Session chapter 3, 253.35 section 27, is amended to read: 253.36 Sec. 27. [TAXPAYER'S PERSONAL INFORMATION; DISCLOSURE.] 254.1 (a) An owner of property in Washington or Ramsey county 254.2 that is subject to property taxation must be informed in a clear 254.3 and conspicuous manner in writing on a form sent to property 254.4 taxpayers that the property owner's name, address, and other 254.5 information may be used, rented, or sold for business purposes, 254.6 including surveys, marketing, and solicitation. 254.7 (b) If the property owner so requests on the form provided, 254.8 then any such list generated by the county and sold for business 254.9 purposes must exclude the owner's name and address if the 254.10 business purpose is conducting surveys, marketing, or 254.11 solicitation. 254.12 (c) This section expires August 1,19992001. 254.13 Sec. 15. [CHISAGO COUNTY AGGREGATE REMOVAL TAX.] 254.14 Subdivision 1. [AUTHORIZATION.] This section applies to 254.15 Chisago county and to its local approval of an aggregate removal 254.16 tax under Minnesota Statutes, section 298.75. Notwithstanding 254.17 the time limitations of Minnesota Statutes, section 645.021, 254.18 subdivision 3, the aggregate removal tax shall be deemed 254.19 approved if the chief clerical officer of Chisago county files 254.20 the certificate of approval of the tax before the first day of 254.21 the 2000 regular session of the legislature. 254.22 Subd. 2. [EFFECTIVE DATE.] This section is effective the 254.23 day following final enactment. 254.24 Sec. 16. [MINNESOTA MINERALS 21ST CENTURY FUND; CONTINGENT 254.25 APPROPRIATION.] 254.26 Subdivision 1. [ALLOCATION.] If, on the basis of a 254.27 forecast of general fund revenues and expenditures after 254.28 November 1, 1999, the commissioner of finance determines that 254.29 there will be a positive unrestricted budgetary general fund 254.30 balance at the close of the biennium, the commissioner of 254.31 finance must allocate money as follows: 254.32 (1) first, to the budget reserve until the total amount in 254.33 that account equals $622,000,000; then 254.34 (2) second, to the Minnesota minerals 21st century fund, if 254.35 a bill styled as H.F. No. 2390 is enacted in 1999 and creates 254.36 such a fund, until the amount allocated under this clause equals 255.1 $20,000,000. 255.2 Subd. 2. [MATCHING REQUIREMENT.] If a bill styled as H.F. 255.3 No. 2390 is enacted in 1999 and it provides for creation of the 255.4 Minnesota minerals 21st century fund, the commissioner of the 255.5 iron range resources and rehabilitation board shall, upon the 255.6 recommendation of the board, match the funds allocated under 255.7 subdivision 1 to the extent they are used for a loan or equity 255.8 investment meeting the requirements of the provision creating 255.9 the Minnesota minerals 21st century fund within H.F. No. 2390. 255.10 Notwithstanding Minnesota Statutes, section 645.33, this 255.11 subdivision supersedes any contrary provisions of H.F. No. 2390 255.12 that is enacted in 1999. 255.13 Sec. 17. [EFFECTIVE DATES.] 255.14 Section 3 is effective for checks received on or after the 255.15 day following final enactment. 255.16 Sections 4 and 11 are effective for payments due on or 255.17 after the day following final enactment. 255.18 Sections 5, 6, and 7 are effective for claims for setoff 255.19 submitted to the commissioner of revenue by claimant agencies 255.20 after June 30, 1999. 255.21 Section 8, paragraph (a), is effective at the same time 255.22 that section 6015(b) of the Internal Revenue Code is effective 255.23 for federal tax purposes. Section 8, paragraph (b), is 255.24 effective for claims for innocent spouse relief, requests for 255.25 allocation of joint income tax liability, and taxes filed or 255.26 paid on or after the day following final enactment. 255.27 Section 9 is effective for disabilities existing on or 255.28 after the date of enactment for which claims for refund have not 255.29 expired under the time limit in Minnesota Statutes, section 255.30 289A.40, subdivision 1. Claims based upon reasonable cause must 255.31 be filed prior to the expiration of the repealed ten-year period 255.32 or within one year after the date of enactment, whichever is 255.33 earlier. 255.34 Section 10 is effective for refund claims filed on or after 255.35 the day following final enactment. 255.36 Section 12 is effective the day following final enactment. 256.1 Section 14 applies to Washington county only and is 256.2 effective upon approval by the governing body of Washington 256.3 county, and compliance with Minnesota Statutes, section 645.021, 256.4 subdivision 3. 256.5 ARTICLE 17 256.6 BUSINESS SUBSIDIES 256.7 Section 1. [116J.993] [DEFINITIONS.] 256.8 Subdivision 1. [SCOPE.] For the purposes of sections 256.9 116J.993 to 116J.996, the terms defined in this section have the 256.10 meanings given them. 256.11 Subd. 2. [BENEFIT DATE.] "Benefit date" means the date 256.12 that the recipient receives the business subsidy. If the 256.13 business subsidy involves the purchase, lease, or donation of 256.14 physical equipment, then the benefit date begins when the 256.15 recipient puts the equipment into service. If the business 256.16 subsidy is for improvements to property, then the benefit date 256.17 refers to the earliest date of either: 256.18 (1) when the improvements are finished for the entire 256.19 project; or 256.20 (2) when a business occupies the property. If a business 256.21 occupies the property and the subsidy grantor expects that other 256.22 businesses will also occupy the same property, the grantor may 256.23 assign a separate benefit date for each business when it first 256.24 occupies the property. 256.25 Subd. 3. [BUSINESS SUBSIDY.] "Business subsidy" or 256.26 "subsidy" means a state or local government agency grant, 256.27 contribution of personal property, real property, 256.28 infrastructure, the principal amount of a loan at rates below 256.29 those commercially available to the recipient, any reduction or 256.30 deferral of any tax or any fee, any guarantee of any payment 256.31 under any loan, lease, or other obligation, or any preferential 256.32 use of government facilities given to a business. 256.33 The following forms of financial assistance are not a 256.34 business subsidy: 256.35 (1) assistance that is generally available to all 256.36 businesses or to a general class of similar businesses, such as 257.1 a line of business, size, location, or similar general criteria; 257.2 (2) public improvements to buildings or lands owned by the 257.3 state or local government that serve a public purpose and do not 257.4 principally benefit a single business or defined group of 257.5 businesses at the time the improvements are made; 257.6 (3) redevelopment property polluted by contaminants as 257.7 defined in section 116J.552, subdivision 3; 257.8 (4) assistance provided for the sole purpose of renovating 257.9 or bringing up to code old or decaying building stock and when 257.10 the assistance is matched by the business using private sources; 257.11 (5) assistance provided to organizations whose primary 257.12 mission is to provide job readiness and training services if the 257.13 sole purpose of the assistance is to provide those services; 257.14 (6) assistance for housing; 257.15 (7) assistance for pollution control or abatement; 257.16 (8) assistance for energy conservation; 257.17 (9) tax reductions resulting from conformity with federal 257.18 tax law; 257.19 (10) workers' compensation and unemployment compensation; 257.20 (11) benefits derived from regulation; 257.21 (12) indirect benefits derived from assistance to 257.22 educational institutions; 257.23 (13) funds from bonds allocated under chapter 474A; 257.24 (14) assistance for a collaboration between a Minnesota 257.25 higher education institution and a business; 257.26 (15) a business subsidy of less than $25,000; and 257.27 (16) redevelopment when the recipient's investment in the 257.28 purchase of the site and in site preparation is 80 percent or 257.29 more of the assessed value at the time of purchase. 257.30 Subd. 4. [GRANTOR.] "Grantor" means any state or local 257.31 government agency with the authority to grant a business subsidy. 257.32 Subd. 5. [LOCAL GOVERNMENT AGENCY.] "Local government 257.33 agency" includes a statutory or home rule charter city, housing 257.34 and redevelopment authority, town, county, port authority, 257.35 economic development authority, community development agency, 257.36 nonprofit entity created by a local government agency, or any 258.1 other entity created by or authorized by a local government with 258.2 authority to provide business subsidies. "Local government 258.3 agency" does not include the St. Paul port authority or a seaway 258.4 port authority. 258.5 Subd. 6. [RECIPIENT.] "Recipient" means any for-profit or 258.6 nonprofit business entity that receives a business subsidy. 258.7 Only nonprofit entities with a ratio of highest to lowest paid 258.8 employee, determined on the basis of full-time equivalent 258.9 positions, exceeding ten to one are included in this definition. 258.10 Subd. 7. [STATE GOVERNMENT AGENCY.] "State government 258.11 agency" means any state agency that has the authority to award 258.12 business subsidies. State government agency includes the St. 258.13 Paul port authority and a seaway port authority. 258.14 Sec. 2. [116J.994] [REGULATING LOCAL AND STATE BUSINESS 258.15 SUBSIDIES.] 258.16 Subdivision 1. [PUBLIC PURPOSE.] A business subsidy must 258.17 meet a public purpose other than increasing the tax base. Job 258.18 retention may only be used as a public purpose in cases where 258.19 job loss is imminent and demonstrable. 258.20 Subd. 2. [DEVELOPING A SET OF CRITERIA.] A business 258.21 subsidy may not be granted until the grantor has adopted 258.22 criteria after a public hearing for awarding business subsidies 258.23 that comply with this section. The criteria must include a 258.24 policy regarding the wages to be paid for the jobs created. The 258.25 commissioner of trade and economic development may assist local 258.26 government agencies in developing criteria. 258.27 Subd. 3. [SUBSIDY AGREEMENT.] (a) A recipient must enter 258.28 into a subsidy agreement with the grantor of the subsidy that 258.29 includes: 258.30 (1) a description of the subsidy, including the amount and 258.31 type of subsidy, and type of district if the subsidy is tax 258.32 increment financing; 258.33 (2) a statement of the public purposes for the subsidy; 258.34 (3) goals for the subsidy; 258.35 (4) a description of the financial obligation of the 258.36 recipient if the goals are not met; 259.1 (5) a statement of why the subsidy is needed; 259.2 (6) a commitment to continue operations at the site where 259.3 the subsidy is used for at least five years after the benefit 259.4 date; 259.5 (7) the name and address of the parent corporation of the 259.6 recipient, if any; and 259.7 (8) a list of all financial assistance by all grantors for 259.8 the project. 259.9 (b) Business subsidies in the form of grants must be 259.10 structured as forgivable loans. If a business subsidy is not 259.11 structured as a forgivable loan, the agreement must state the 259.12 fair market value of the subsidy to the recipient, including the 259.13 value of conveying property at less than a fair market price, or 259.14 other in-kind benefits to the recipient. 259.15 (c) If a business subsidy benefits more than one recipient, 259.16 the grantor must assign a proportion of the business subsidy to 259.17 each recipient that signs a subsidy agreement. The proportion 259.18 assessed to each recipient must reflect a reasonable estimate of 259.19 the recipient's share of the total benefits of the project. 259.20 (d) The state or local government agency and the recipient 259.21 must both sign the subsidy agreement and, if the grantor is a 259.22 local government agency, the agreement must be approved by the 259.23 local elected governing body. 259.24 Subd. 4. [WAGE AND JOB GOALS.] The subsidy agreement, in 259.25 addition to any other goals, must include: (1) goals for the 259.26 number of jobs created, which may include separate goals for the 259.27 number of part-time or full-time jobs, or, in cases where job 259.28 loss is imminent and demonstrable, goals for the number of jobs 259.29 retained; and (2) wage goals for the jobs created or retained. 259.30 In addition to other specific goal time frames, the wage 259.31 and job goals must contain specific goals to be attained within 259.32 two years of the benefit date. 259.33 Subd. 5. [PUBLIC NOTICE AND HEARING.] (a) Before granting 259.34 a business subsidy that exceeds $500,000 for a state government 259.35 grantor and $100,000 for a local government grantor, the grantor 259.36 must provide public notice and a hearing on the subsidy. A 260.1 public hearing and notice pursuant to this subdivision is not 260.2 required if a hearing and notice on the subsidy is otherwise 260.3 required by law. 260.4 (b) Public notice of a proposed business subsidy under this 260.5 subdivision by a state government grantor must be published in 260.6 the State Register. Public notice of a proposed business 260.7 subsidy under this subdivision by a local government grantor 260.8 must be published in a local newspaper of general circulation. 260.9 The public notice must identify the location at which 260.10 information about the business subsidy, including a copy of the 260.11 subsidy agreement, is available. Published notice should be 260.12 sufficiently conspicuous in size and placement to distinguish 260.13 the notice from the surrounding text. The grantor must make the 260.14 information available in printed paper copies and, if possible, 260.15 on the Internet. The government agency must provide at least a 260.16 ten-day notice for the public hearing. 260.17 (c) The public notice must include the date, time, and 260.18 place of the hearing. 260.19 (d) The public hearing by a state government grantor must 260.20 be held in St. Paul. 260.21 Subd. 6. [FAILURE TO MEET GOALS.] The subsidy agreement 260.22 must specify the recipient's obligation if the recipient does 260.23 not fulfill the agreement. At a minimum, the agreement must 260.24 require a recipient failing to meet subsidy agreement goals to 260.25 pay back the assistance plus interest provided that repayment 260.26 may be prorated to reflect partial fulfillment of goals. The 260.27 interest rate must be set at the implicit price deflator defined 260.28 under section 275.70, subdivision 2. The grantor, after a 260.29 public hearing, may extend for up to one year the period for 260.30 meeting the goals provided in a subsidy agreement. 260.31 A recipient that fails to meet the terms of a subsidy 260.32 agreement may not receive a business subsidy from any grantor 260.33 for a period of five years from the date of failure or until a 260.34 recipient satisfies its repayment obligation under this 260.35 subdivision, whichever occurs first. 260.36 Before a grantor signs a business subsidy agreement, the 261.1 grantor must check with the compilation and summary report 261.2 required by this section to determine if the recipient is 261.3 eligible to receive a business subsidy. 261.4 Subd. 7. [REPORTS BY RECIPIENTS TO GRANTORS.] (a) A 261.5 business subsidy grantor must monitor the progress by the 261.6 recipient in achieving agreement goals. 261.7 (b) A recipient must provide information regarding goals 261.8 and results for two years after the benefit date or until the 261.9 goals are met, whichever is later. If the goals are not met, 261.10 the recipient must continue to provide information on the 261.11 subsidy until the subsidy is repaid. The information must be 261.12 filed on forms developed by the commissioner in cooperation with 261.13 representatives of local government. Copies of the completed 261.14 forms must be sent to the commissioner and the local government 261.15 agency that provided the business subsidy. The report must 261.16 include: 261.17 (1) the type, public purpose, and amount of subsidies and 261.18 type of district if the subsidy is tax increment financing; 261.19 (2) the hourly wage of each job created with separate bands 261.20 of wages; 261.21 (3) the sum of the hourly wages and cost of health 261.22 insurance provided by the employer with separate bands of wages; 261.23 (4) the date the job and wage goals will be reached; 261.24 (5) a statement of goals identified in the subsidy 261.25 agreement and an update on achievement of those goals; 261.26 (6) the location of the recipient prior to receiving the 261.27 business subsidy; 261.28 (7) why the recipient did not complete the project outlined 261.29 in the subsidy agreement at their previous location, if the 261.30 recipient was previously located at another site in Minnesota; 261.31 (8) the name and address of the parent corporation of the 261.32 recipient, if any; 261.33 (9) a list of all financial assistance by all grantors for 261.34 the project; and 261.35 (10) other information the commissioner may request. 261.36 A report must be filed no later than March 1 of each year for 262.1 the previous year and within 30 days after the deadline for 262.2 meeting the job and wage goals. A local government agency must, 262.3 by April 1 of each year, report in a form approved by the 262.4 commissioner a summary of the business subsidy reports submitted 262.5 that year. The local government agency must include a list of 262.6 recipients that did not complete the report and of recipients 262.7 that have not met their job and wage goals within two years and 262.8 what steps are being taken to bring them into compliance or to 262.9 recoup the subsidy. The commissioner, by July 1 of each year, 262.10 must provide to the legislature a summary of the reports 262.11 submitted to the department. 262.12 (c) Financial assistance that is excluded from the 262.13 definition of "business subsidy" by subdivision 3, clauses (3), 262.14 (4), and (7), is subject to the reporting requirements of this 262.15 subdivision, except that the report of the recipient must 262.16 include: 262.17 (1) the type, public purpose, and amount of the financial 262.18 assistance, and type of district if the subsidy is tax increment 262.19 financing; 262.20 (2) progress towards meeting goals stated in the subsidy 262.21 agreement and the public purpose of the assistance; 262.22 (3) the hourly wage of each job created with separate bands 262.23 of wages; 262.24 (4) the sum of the hourly wages and cost of health 262.25 insurance provided by the employer with separate bands of wages; 262.26 (5) the location of the recipient prior to receiving the 262.27 assistance; and 262.28 (6) other information the grantor requests. 262.29 (d) If the recipient does not submit its report, the local 262.30 government agency must mail the recipient a warning within one 262.31 week of the required filing date. If, after 14 days of the 262.32 postmarked day of the warning, the recipient fails to provide a 262.33 report, then a penalty of $100 per day, payable to the grantor, 262.34 applies until the report is filed. 262.35 Subd. 8. [GOVERNMENT REPORTS.] (a) The commissioner of 262.36 trade and economic development must coordinate the production of 263.1 reports so that useful comparisons across time periods and 263.2 across grantors can be made. The commissioner may add other 263.3 information to the report as the commissioner deems necessary to 263.4 evaluate business subsidies. 263.5 (b) State and local government agencies, regardless of 263.6 whether they awarded any business subsidies, must file the 263.7 report required by this subdivision by April 1 of each year with 263.8 the commissioner. If the commissioner has not received the 263.9 report by that date, the commissioner shall issue a warning to 263.10 the government agency. If the commissioner has not received a 263.11 report by June 1 of the same year, then the government agency 263.12 may not grant any business subsidies until it files the report. 263.13 (c) The commissioner of trade and economic development must 263.14 provide information on reporting requirements to state and local 263.15 government agencies. 263.16 Subd. 9. [COMPILATION AND SUMMARY REPORT.] The department 263.17 of trade and economic development must publish a compilation and 263.18 summary of the results of the reports for the previous calendar 263.19 year by July 1 of each year. The reports of the government 263.20 agencies to the department and the compilation and summary 263.21 report of the department must be made available to the public. 263.22 Among the information in the summary and compilation 263.23 report, the commissioner must include: 263.24 (1) total amount of subsidies awarded in each development 263.25 region of the state; 263.26 (2) distribution of business subsidy amounts by size of the 263.27 business subsidy; 263.28 (3) distribution of business subsidy amounts by time 263.29 category, such as monthly or quarterly; 263.30 (4) distribution of subsidies by type and by public 263.31 purpose; 263.32 (5) percent of all business subsidies that reached their 263.33 goals; 263.34 (6) percent of business subsidies that did not reach their 263.35 goals by two years from the benefit date; 263.36 (7) total dollar amount of business subsidies that did not 264.1 meet their goals after two years from the benefit date; 264.2 (8) percent of subsidies that did not meet their goals and 264.3 that did not receive repayment; 264.4 (9) list of recipients that have failed to meet the terms 264.5 of a subsidy agreement in the past five years; 264.6 (10) number of part-time and full-time jobs within separate 264.7 bands of wages; and 264.8 (11) benefits paid within separate bands of wages. 264.9 Sec. 3. [116J.995] [ECONOMIC GRANTS.] 264.10 An appropriation rider in an appropriation to the 264.11 department of trade and economic development that specifies that 264.12 the appropriation be granted to a particular business or class 264.13 of businesses must contain a statement of the expected benefits 264.14 associated with the grant. At a minimum, the statement must 264.15 include goals for the number of jobs created, wages paid, and 264.16 the tax revenue increases due to the grant. 264.17 Sec. 4. [REPEALER.] 264.18 Minnesota Statutes 1998, section 116J.991, is repealed. 264.19 Sec. 5. [EFFECTIVE DATE.] 264.20 Sections 1 and 2 are effective August 1, 1999, except that, 264.21 for direct appropriations, it is effective only for 264.22 appropriations authorized after August 1, 1999. Section 3 is 264.23 effective for appropriations authorized after August 1, 1999.