Journal of the House - 6th Day Special Session

A quorum was present.

Wagenius was excused.

Kahn was excused until 9:35 p.m.

The Chief Clerk proceeded to read the Journal of the preceding day. Hoppe moved that further reading of the Journal be suspended and that the Journal be approved as corrected by the Chief Clerk. The motion prevailed.

<HR><a name=122></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 122</center><HR>FISCAL CALENDAR ANNOUNCEMENT

Pursuant to rule 1.22, Abrams announced his intention to place H. F. No. 7 on the Fiscal Calendar for Tuesday, May 27, 2003.

Paulsen moved that the House recess subject to the call of the Chair. The motion prevailed.

RECESS

RECONVENED

The House reconvened and was called to order by the Speaker.

INTRODUCTION AND FIRST READING OF HOUSE BILLS

The following House Files were introduced:

Dill introduced:

H. F. No. 59, A bill for an act relating to game and fish; providing for lead tackle awareness and education; providing for grants.

The bill was read for the first time and referred to the Committee on Environment and Natural Resources Policy.

Severson introduced:

H. F. No. 60, A bill for an act relating to capital improvements; authorizing the issuance of state bonds; appropriating money for the Sauk Rapids bridge.

The bill was read for the first time and referred to the Committee on Rules and Legislative Administration.

Dorman and Marquart introduced:

H. F. No. 61, A bill for an act relating to taxation; eliminating payment of market value homestead credit reimbursements to cities; reinstating authorization to levy for transit purposes; providing for additional means of financing transit; reducing local government aid payable to cities; amending Minnesota Statutes 2002, sections 273.1384, subdivision 4; 473.388, subdivisions 4, 7; 473.446, subdivision 1, by adding subdivisions; 477A.03, subdivision 2; repealing Minnesota Statutes 2002, sections 174.242; 477A.03, subdivision 4.

The bill was read for the first time and referred to the Committee on Rules and Legislative Administration.

<HR><a name=123></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 123</center><HR> Boudreau introduced:

H. F. No. 62, A bill for an act relating to public safety; regulating firearms; modifying the reasonable request provisions of the Personal Protection Act of 2003; amending Minnesota Statutes 2002, section 624.714, subdivision 17, as added.

The bill was read for the first time and referred to the Committee on Rules and Legislative Administration.

Lipman introduced:

H. F. No. 63, A bill for an act relating to probate; providing for memorial fund trusts; changing an application provision; providing for agreements; clarifying procedures; providing an effective date; eliminating a duplicative affidavit requirement; amending Minnesota Statutes 2002, sections 501B.14, subdivision 3; 524.3‑1201; Laws 2002, chapter 347, section 5; proposing coding for new law in Minnesota Statutes, chapter 501B.

The bill was read for the first time and referred to the Committee on Rules and Legislative Administration.

FISCAL CALENDAR ANNOUNCEMENT

Pursuant to rule 1.22, Knoblach announced his intention to place H. F. No. 5 on the Fiscal Calendar for Tuesday, May 27, 2003.

FISCAL CALENDAR

Pursuant to rule 1.22, Knoblach requested immediate consideration of H. F. No. 5.

H. F. No. 5 was reported to the House.

Kuisle moved to amend H. F. No. 5 as follows:

Delete everything after the enacting clause and insert:

"ARTICLE 1

APPROPRIATIONS

TRANSPORTATION AND OTHER AGENCIES

Section 1. [TRANSPORTATION AND OTHER AGENCIES APPROPRIATIONS.]

The sums shown in the columns marked "APPROPRIATIONS" are appropriated from the general fund, or another named fund, to the agencies and for the purposes specified in this article, to be available for the fiscal years indicated for each purpose. The figures "2004" and "2005," where used in this article, mean that the appropriations listed under them are available for the year ending June 30, 2004, or June 30, 2005, respectively. If the figures are not used, the appropriations are available for the year ending June 30, 2004, or June 30, 2005, respectively. The term "first year" means the year ending June 30, 2004, and the term "second year" means the year ending June 30, 2005.

<HR><a name=124></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 124</center><HR>SUMMARY BY FUND

2004 2005 TOTAL

General $80,036,000 $81,142,000 $161,178,000

Airports 19,458,000 19,458,000 38,916,000

C.S.A.H. 426,020,000 433,631,000 859,651,000

M.S.A.S. 112,290,000 114,661,000 226,951,000

Special Revenue 1,144,000 1,144,000 2,288,000

Highway User 12,336,000 12,336,000 24,672,000

Trunk Highway 1,205,907,000 1,272,051,000 2,477,958,000

Petroleum Tank Release Cleanup Fund 527,000 -0- 527,000

TOTAL $1,857,191,000 $1,934,423,000 $3,791,614,000

APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

Sec. 2. TRANSPORTATION

Subdivision 1. Total Appropriation $1,681,512,000 $1,757,479,000

The appropriations in this section are from the trunk highway fund, except when another fund is named.

Summary by Fund

2004 2005

General 16,220,000 16,221,000

Airports 19,408,000 19,408,000

C.S.A.H. 426,020,000 433,631,000

M.S.A.S. 112,290,000 114,661,000

Trunk Highway 1,107,574,000 1,173,558,000

The amounts that may be spent from this appropriation for each program are specified in the following subdivisions.

<HR><a name=125></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 125</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

Subd. 2. Multimodal Systems 41,688,000 41,689,000

Summary by Fund

Airports 19,383,000 19,383,000

General 16,295,000 16,296,000

Trunk Highway 6,010,000 6,010,000

The amounts that may be spent from this appropriation for each activity are as follows:

(a) Aeronautics

20,395,000 20,395,000

Summary by Fund

Airports 19,383,000 19,383,000

Trunk Highway 1,012,000 1,012,000

Except as otherwise provided, the appropriations in this subdivision are from the state airports fund.

(1) Airport Development and Assistance

14,298,000 14,298,000

These appropriations must be spent according to Minnesota Statutes, section 360.305, subdivision 4.

Notwithstanding Minnesota Statutes, section 16A.28, subdivision 6, funds are available for five years after appropriation.

If the appropriation for either year is insufficient, the appropriation for the other year is available for it.

Of this appropriation $750,000 each year is for the long-range radar facility in Alexandria. This appropriation is contingent on a partnership with the federal aviation administration for this project.

$100,000 in each fiscal year must be used for hangar construction for the civil air patrol at the South St. Paul airport.

<HR><a name=126></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 126</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

(2) Aviation Support and Services

6,097,000 6,097,000

Summary by Fund

Airports 5,085,000 5,085,000

Trunk Highway 1,012,000 1,012,000

$65,000 the first year and $65,000 the second year are for the civil air patrol.

(b) Transit

16,097,000 16,098,000

Summary by Fund

General 15,949,000 15,950,000

Trunk Highway 148,000 148,000

The general fund budget base for this activity is $15,810,000 in each year of the 2006-2007 biennium.

The commissioner shall provide funding up to $350,000 for the operation of the Northstar commuter coach from October 1, 2003, to September 30, 2004, using accumulated fare revenue, if a local government unit or the Northstar Corridor Development Authority:

(1) agrees to operate the service beginning October 1, 2003; and

(2) provides the local match for federal funding for the service.

1,569,000 1,569,000

Summary by Fund

General 220,000 220,000

Trunk Highway 1,349,000 1,349,000

<HR><a name=127></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 127</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

Notwithstanding Minnesota Statutes, section 222.49, after July 1, 2003, and before June 30, 2004, the commissioner of finance shall transfer $3,200,000 from the rail service improvement account in the special revenue fund to the debt service fund.

Notwithstanding Minnesota Statutes, section 222.49, after July 1, 2004, and before June 30, 2005, the commissioner of finance shall transfer $3,200,000 from the rail service improvement account in the special revenue fund to the debt service fund.

(d) Commercial Vehicles

3,627,000 3,627,000

Summary by Fund

General 126,000 126,000

Trunk Highway 3,501,000 3,501,000

Subd. 3. State Roads 1,045,224,000 1,115,658,000

Summary by Fund

General 9,000 9,000

Trunk Highway 1,045,215,000 1,115,649,000

The amounts that may be spent from this appropriation for each activity are as follows:

(a) Infrastructure Investment and Planning

836,593,000 907,027,000

$266,000 the first year and $266,000 the second year are available for grants to metropolitan planning organizations outside the seven-county metropolitan area.

$75,000 the first year and $75,000 the second year are for a transportation research contingent account to finance research projects that are reimbursable from the federal government or from other sources. If the appropriation for either year is insufficient, the appropriation for the other year is available for it.

<HR><a name=128></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 128</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

$600,000 the first year and $600,000 the second year are available for grants for transportation studies outside the metropolitan area to identify critical concerns, problems, and issues. These grants are available (1) to regional development commissions, and (2) in regions where no regional development commission is functioning, to joint powers boards established under agreement of two or more political subdivisions in the region to exercise the planning functions of a regional development commission, and (3) in regions where no regional development commission or joint powers board is functioning, to the department's district office for that region.

(1) State Road Construction

636,957,000 685,450,000

It is estimated that these appropriations will be funded as follows:

Federal Highway Aid

325,000,000 375,000,000

Highway User Taxes

311,957,000 310,450,000

The commissioner of transportation shall notify the chair of the transportation budget division of the senate and the chair of the transportation finance committee of the house of representatives of any significant events that should cause these estimates to change.

This appropriation is for the actual construction, reconstruction, and improvement of trunk highways including consultant usage to support these activities. This includes the cost of actual payment to landowners for lands acquired for highway rights-of-way, payment to lessees, interest subsidies, and relocation expenses.

The commissioner may transfer up to $15,000,000 each year to the transportation revolving loan fund.

$330,000 the first year is for operating costs of bus service to mitigate traffic impacts of the construction project involving I-494, the Wakota bridge, and trunk highway 61.

<HR><a name=129></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 129</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

The commissioner may receive money covering other shares of the cost of partnership projects. These receipts are appropriated to the commissioner for these projects.

(2) Highway Debt Service

40,149,000 60,583,000

$33,640,000 the first year and $54,012,000 the second year are for transfer to the state bond fund. If this appropriation is insufficient to make all transfers required in the year for which it is made, the commissioner of finance shall notify the committee on state government finance of the senate and the committee on ways and means of the house of representatives of the amount of the deficiency and shall then transfer that amount under the statutory open appropriation. Any excess appropriation cancels to the trunk highway fund.

(b) Infrastructure Operations and Maintenance

203,641,000 203,641,000

4,990,000 4,990,000

Summary by Fund

General 9,000 9,000

Trunk Highway 4,981,000 4,981,000

$9,000 the first year and $9,000 the second year are from the general fund for equipment and operation of the Roosevelt signal tower for Lake of the Woods weather broadcasting.

Subd. 4. Local Roads 538,310,000 548,292,000

Summary by Fund

C.S.A.H. 426,020,000 433,631,000

M.S.A.S. 112,290,000 114,661,000

<HR><a name=130></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 130</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

The amounts that may be spent from this appropriation for each activity are as follows:

(a) County State Aids

426,020,000 433,631,000

This appropriation is from the county state-aid highway fund and is available until spent.

(b) Municipal State Aids

112,290,000 114,661,000

This appropriation is from the municipal state-aid street fund and is available until spent.

If an appropriation for either county state aids or municipal state aids does not exhaust the balance in the fund from which it is made in the year for which it is made, the commissioner of finance, upon request of the commissioner of transportation, shall notify the chair of the transportation finance committee of the house of representatives and the chair of the transportation budget division of the senate of the amount of the remainder and shall then add that amount to the appropriation. The amount added is appropriated for the purposes of county state aids or municipal state aids, as appropriate.

Subd. 5. General Support and Services 56,430,000 51,980,000

Summary by Fund

General 56,000 56,000

Airports 25,000 25,000

Trunk Highway 56,349,000 51,899,000

The amounts that may be spent from this appropriation for each activity are as follows:

(a) Department Support

38,653,000 38,653,000

<HR><a name=131></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 131</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

Summary by Fund

Airports 25,000 25,000

Trunk Highway 38,628,000 38,628,000

(b) Buildings

17,777,000 13,327,000

Summary by Fund

General 56,000 56,000

Trunk Highway 17,721,000 13,271,000

In fiscal year 2004, $4,450,000 of this appropriation is to design, construct, furnish, and equip a building in Pennington county for the joint use of the county of Pennington and departments of transportation, public safety, and natural resources for vehicle maintenance and vehicle storage. This appropriation remains available and does not lapse.

If the appropriation for either year is insufficient, the appropriation for the other year is available for it.

Subd. 6. Transfers

(a) With the approval of the commissioner of finance, the commissioner of transportation may transfer unencumbered balances among the appropriations from the trunk highway fund and the state airports fund made in this section. No transfer may be made from the appropriation for state road construction. No transfer may be made from the appropriations for debt service to any other appropriation. Transfers under this paragraph may not be made between funds. Transfers between programs must be reported immediately to the chair of the transportation budget division of the senate and the chair of the transportation finance committee of the house of representatives.

(b) The commissioner of finance shall transfer from the flexible account in the county state-aid highway fund $14,400,000 the first year and $8,300,000 the second year to the municipal turnback account in the municipal state-aid street fund, and the remainder in each year to the county turnback account in the county state-aid highway fund.

<HR><a name=132></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 132</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

Subd. 7. Use of State Road Construction Appropriations

Any money appropriated to the commissioner of transportation for state road construction for any fiscal year before fiscal year 2004 is available to the commissioner during fiscal years 2004 and 2005 to the extent that the commissioner spends the money on the state road construction project for which the money was originally encumbered during the fiscal year for which it was appropriated. The commissioner of transportation shall report to the commissioner of finance by August 1, 2003, and August 1, 2004, on a form the commissioner of finance provides, on expenditures made during the previous fiscal year that are authorized by this subdivision.

Subd. 8. Contingent Appropriation

The commissioner of transportation, with the approval of the governor after review by the legislative advisory commission under Minnesota Statutes, section 3.30, may transfer all or part of the unappropriated balance in the trunk highway fund to an appropriation (1) for trunk highway design, construction, or inspection in order to take advantage of an unanticipated receipt of income to the trunk highway fund or to take advantage of Federal Advanced Construction funding, (2) for trunk highway maintenance in order to meet an emergency, or (3) to pay tort or environmental claims. Any transfer as a result of the use of Federal Advanced Construction funding must include an analysis of the effects on the long-term trunk highway fund balance. The amount transferred is appropriated for the purpose of the account to which it is transferred.

Subd. 9. Budget Base Reduction Report

By December 15, 2003, and December 15, 2004, the commissioner of transportation shall report to the chairs of the senate and house of representatives committees with jurisdiction over transportation policy and finance regarding the distribution and impacts of the base budget reductions. The report must include a description and enumeration of program activities with reduced spending levels and the impacts on the department's performance measures. The report must identify the total number of positions that were reduced or eliminated through attrition or layoffs, the number of positions reduced or eliminated in each of the bargaining units represented within the department, and the impact on the number of women and minorities employed by the department and the department's affirmative action goals.

<HR><a name=133></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 133</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

Sec. 3. METROPOLITAN COUNCIL TRANSIT 56,810,000 57,910,000

(a) The agency's budget base for fiscal year 2006 is $57,503,000 and for fiscal year 2007 is $58,753,000.

(b) Bus Transit

54,010,000 54,010,000

This appropriation is for bus system operations.

2,800,000 3,900,000

This appropriation is for operations of the Hiawatha LRT line. The base for rail operations for fiscal year 2006 is $4,050,000 and for fiscal year 2007 is $5,300,000.

This appropriation is for paying 50 percent of operating costs for the Hiawatha light rail transit line after operating revenue and federal funds are used for light rail transit operations. The remaining operating costs up to a maximum of $2,800,000 the first year and $3,900,000 the second year are to be paid by the Hennepin county regional rail authority, using any or all of these sources:

(1) general tax revenues of Hennepin county;

(2) the authority's reserves; and

(3) taxes levied under Minnesota Statutes, section 398A.04, subdivision 8, notwithstanding any provision in that subdivision that limits amounts that may be levied for light rail transit purposes.

By September 1, 2003, the metropolitan council shall submit to Hennepin county regional rail authority a proposed detailed operations management plan for Hiawatha light rail transit, covering operations through June 30, 2005. The plan may include, without limitation, operating plans concerning formation and negotiation of contracts for management or other services, service schedules, fare policy, vehicle and facility maintenance, and staffing. The council may not implement or modify the plan without the approval of Hennepin county. Minnesota Statutes, section 473.392, does not apply to the procurement by the council of operating services for the Hiawatha light rail transit line.

<HR><a name=134></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 134</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

(d) Budget Base Reduction Report

By December 15, 2003, and December 15, 2004, the chair of the metropolitan council shall report to the chairs of the senate and house of representatives committees with jurisdiction over transportation policy and finance regarding the distribution and impacts of the base budget reductions. The report must include a description and enumeration of program activities with reduced spending levels and the impacts on transit service levels and performance of the regular route and metro mobility systems. The report must identify the total number of positions that were reduced or eliminated through attrition or layoffs, the number of positions reduced or eliminated in each of the bargaining units represented within the council, and the impact on the number of women and minorities employed by the council.

Sec. 4. PUBLIC SAFETY

Subdivision 1. Total Appropriation 117,894,000 118,059,000

Summary by Fund

General 7,006,000 7,011,000

Trunk Highway 97,533,000 97,693,000

Highway User 12,211,000 12,211,000

Special Revenue 1,144,000 1,144,000

Subd. 2. Administration and Related Services 9,684,000 9,689,000

Summary by Fund

General 2,361,000 2,366,000

Trunk Highway 5,938,000 5,938,000

Highway User 1,385,000 1,385,000

(a) Office of Communications

385,000 385,000

<HR><a name=135></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 135</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

Summary by Fund

General 39,000 39,000

Trunk Highway 346,000 346,000

(b) Public Safety Support

6,845,000 6,850,000

Summary by Fund

General 2,231,000 2,236,000

Trunk Highway 3,248,000 3,248,000

Highway User 1,366,000 1,366,000

$365,000 the first year and $370,000 the second year are for payment of public safety officer survivor benefits under Minnesota Statutes, section 299A.44. If the appropriation for either year is insufficient, the appropriation for the other year is available for it. The base for fiscal year 2006 is $375,000 and for fiscal year 2007 is $380,000.

$314,000 the first year and $314,000 the second year are to be deposited in the public safety officer's benefit account. This money is available for reimbursements under Minnesota Statutes, section 299A.465.

$508,000 the first year and $508,000 the second year are for soft body armor reimbursements under Minnesota Statutes, section 299A.38.

$792,000 the first year and $792,000 the second year are appropriated from the general fund for transfer by the commissioner of finance to the trunk highway fund on December 31, 2003, and December 31, 2004, respectively, in order to reimburse the trunk highway fund for expenses not related to the fund. These represent amounts appropriated out of the trunk highway fund for general fund purposes in the administration and related services program.

<HR><a name=136></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 136</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

$610,000 the first year and $610,000 the second year are appropriated from the highway user tax distribution fund for transfer by the commissioner of finance to the trunk highway fund on December 31, 2003, and December 31, 2004, respectively, in order to reimburse the trunk highway fund for expenses not related to the fund. These represent amounts appropriated out of the trunk highway fund for highway user tax distribution fund purposes in the administration and related services program.

$716,000 the first year and $716,000 the second year are appropriated from the highway user tax distribution fund for transfer by the commissioner of finance to the general fund on December 31, 2003, and December 31, 2004, respectively, in order to reimburse the general fund for expenses not related to the fund. These represent amounts appropriated out of the general fund for operation of the criminal justice data network related to driver and motor vehicle licensing.

2,454,000 2,454,000

Summary by Fund

General 91,000 91,000

Trunk Highway 2,344,000 2,344,000

Highway User 19,000 19,000

Subd. 3. State Patrol 69,832,000 70,032,000

Summary by Fund

General 2,871,000 2,871,000

Trunk Highway 66,869,000 67,069,000

Highway User 92,000 92,000

(a) Patrolling Highways

60,524,000 60,724,000

<HR><a name=137></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 137</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

Summary by Fund

General 37,000 37,000

Trunk Highway 60,395,000 60,595,000

Highway User 92,000 92,000

Of this appropriation, $3,500,000 the first year and $3,700,000 the second year are for the cost of adding state patrol positions. If money transferred to the trunk highway fund in either year from the alcohol enforcement account in the special revenue fund is less than the amount specified for that year in this paragraph, the commissioner shall make up the difference by transferring to the trunk highway fund money allocated to the commissioner under the federal repeat offender transfer program, Public Law 105-206, section 164.

(b) Commercial Vehicle Enforcement

6,474,000 6,474,000

This appropriation is from the trunk highway fund.

2,834,000 2,834,000

The commissioner may not (1) spend any money from the trunk highway fund for capitol security, or (2) permanently transfer any state trooper from the patrolling highways activity to capitol security.

The commissioner may not transfer any money (1) appropriated for department of public safety administration, the patrolling of highways, commercial vehicle enforcement, or driver and vehicle services to capitol security or (2) from capitol security.

Subd. 4. Driver and Vehicle Services

36,910,000 36,870,000

Summary by Fund

General 1,774,000 1,774,000

<HR><a name=138></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 138</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

Trunk Highway 24,402,000 24,362,000

Highway User 10,734,000 10,734,000

(a) Vehicle Services

12,452,000 12,452,000

` Summary by Fund

General 1,718,000 1,718,000

Highway User 10,734,000 10,734,000

(b) Driver Services

24,458,000 24,418,000

Summary by Fund

General 56,000 56,000

Trunk Highway 24,402,000 24,362,000

Subd. 5. Traffic Safety 324,000 324,000

This appropriation is from the trunk highway fund.

The commissioners of public safety and transportation shall jointly report annually to the chairs and ranking minority members of the house of representatives and senate committees having jurisdiction over transportation and public safety finance issues on the expenditure of any federal funds available under the repeat offender transfer program, Public Law 105-206, section 164.

The commissioner of transportation shall spend 50 percent of the money available to the state under Public Law 105-206, section 164, for hazard elimination activities under United States Code, title 23, section 152, and the remaining 50 percent must be transferred to the commissioner of public safety.

Subd. 6. Pipeline Safety 994,000 994,000

This appropriation is from the pipeline safety account in the special revenue fund.

<HR><a name=139></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 139</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

Subd. 7. Alcohol and Gambling Enforcement 150,000 150,000

This appropriation, or so much thereof as is necessary, is from the alcohol enforcement account in the special revenue fund and is for alcohol enforcement and administration. This appropriation is in addition to any other appropriation for this purpose.

Subd. 8. Budget Base Reductions Report

By December 15, 2003, and December 15, 2004, the commissioner of public safety shall report to the chairs of the senate and house of representatives committees with jurisdiction over transportation policy and finance regarding the distribution of and impacts of the base budget reductions to administration and related services, driver and vehicle services, and capitol security. The report must include a description of the program activities with reduced spending levels and the impacts on the department's performance. The report must identify the total number of positions that were reduced or eliminated, the number of positions reduced or eliminated in each of the bargaining units represented within the department, and the impact on the number of women and minorities employed by the department and the department's affirmative action goals.

Sec. 5. GENERAL CONTINGENT ACCOUNTS 375,000 375,000

Summary by Fund

Trunk Highway 200,000 200,000

Highway User 125,000 125,000

Airports 50,000 50,000

The appropriations in this section may only be spent with the approval of the governor after consultation with the legislative advisory commission pursuant to Minnesota Statutes, section 3.30.

If an appropriation in this section for either year is insufficient, the appropriation for the other year is available for it.

Sec. 6. TORT CLAIMS 600,000 600,000

To be spent by the commissioner of finance.

<HR><a name=140></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 140</center><HR> APPROPRIATIONS

Available for the Year

Ending June 30

2004 2005

This appropriation is from the trunk highway fund.

If the appropriation for either year is insufficient, the appropriation for the other year is available for it.

Sec. 7. COMMERCE 527,000 -0-

This appropriation is from the petroleum tank release cleanup fund for the weights and measures division of the department of commerce to inspect and test petroleum measuring equipment. This appropriation may not be transferred.

Sec. 8. Minnesota Statutes 2002, section 239.101, is amended by adding a subdivision to read:

Subd. 8. [TEMPORARY PETROLEUM INSPECTION COST RECOVERY.] Until July 1, 2004, the cost of inspecting petroleum measuring equipment must be considered one of the expenditures that may be recovered under section 115C.08, subdivision 4, notwithstanding any other provision of this section or section 115C.08.

ARTICLE 2

OTHER CHANGES RELATED TO TRANSPORTATION

AND PUBLIC SAFETY

Section 1. Minnesota Statutes 2002, section 13.44, subdivision 3, is amended to read:

Subd. 3. [REAL PROPERTY; APPRAISAL DATA.] (a) [CONFIDENTIAL OR PROTECTED NONPUBLIC DATA.] Estimated or appraised values of individual parcels of real property which are made by personnel of the state, its agencies and departments, or a political subdivision or by independent appraisers acting for the state, its agencies and departments, or a political subdivision for the purpose of selling or acquiring land through purchase or condemnation are classified as confidential data on individuals or protected nonpublic data.

(b) [PUBLIC DATA.] The data made confidential or protected nonpublic by the provisions of paragraph (a) shall become public upon the occurrence of any of the following:

(1) the negotiating parties exchange appraisals;

(2) the data are submitted to a court appointed condemnation commissioner;

(3) the data are presented in court in condemnation proceedings; or

(4) the negotiating parties enter into an agreement for the purchase and sale of the property; or

(5) the data are submitted to the owner under section 117.036.

<HR><a name=141></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 141</center><HR> Sec. 2. Minnesota Statutes 2002, section 16A.88, subdivision 1, is amended to read:

Subdivision 1. [GREATER MINNESOTA TRANSIT FUND.] The greater Minnesota transit fund is established within the state treasury. Money in the fund is annually appropriated to the commissioner of transportation for assistance to transit systems outside the metropolitan area under section 174.24. Beginning in fiscal year 2003, the commissioner may use up to $400,000 each year for administration of the transit program. The commissioner shall use the fund for transit operations as provided in section 174.24 and related program administration.

Sec. 3. [117.036] [APPRAISAL AND NEGOTIATION REQUIREMENTS APPLICABLE TO ACQUISITION OF PROPERTY FOR TRANSPORTATION PURPOSES.]

Subdivision 1. [APPLICATION.] This section applies to the acquisition of property for public highways, streets, roads, alleys, airports, mass transit facilities, or for other transportation facilities or purposes.

Subd. 2. [APPRAISAL.] (a) Before commencing an eminent domain proceeding under this chapter, the acquiring authority must obtain at least one appraisal for the property proposed to be acquired. In making the appraisal, the appraiser must confer with one or more of the owners of the property, if reasonably possible. At least 20 days before presenting a petition under section 117.055, the acquiring authority must provide the owner with a copy of the appraisal and inform the owner of the owner's right to obtain an appraisal under this section.

(b) The owner may obtain an appraisal by a qualified appraiser of the property proposed to be acquired. The owner is entitled to reimbursement for the reasonable costs of the appraisal from the acquiring authority up to a maximum of $1,500 within 30 days after the owner submits to the acquiring authority the information necessary for reimbursement, provided that the owner does so within 60 days after the owner receives the appraisal from the authority under paragraph (a).

Subd. 3. [NEGOTIATION.] In addition to the appraisal requirements under subdivision 2, before commencing an eminent domain proceeding, the acquiring authority must make a good faith attempt to negotiate personally with the owner of the property in order to acquire the property by direct purchase instead of the use of eminent domain proceedings. In making this negotiation, the acquiring authority must consider the appraisals in its possession and other information that may be relevant to a determination of damages under this chapter.

Sec. 4. Minnesota Statutes 2002, section 117.232, subdivision 1, is amended to read:

Subdivision 1. When acquisition of private property is accomplished by the state department of transportation by direct purchase the owner shall be entitled to reimbursement for appraisal fees, not to exceed a total of ~~$500~~ $1,500. When acquisition of private property is accomplished by any other acquiring authority, the owner is entitled to reimbursement for appraisal fees, not to exceed ~~$500~~ $1,500, if the owner is otherwise entitled to reimbursement under sections 117.50 to 117.56. The purchaser in all instances shall inform the owner of the right, if any, to reimbursement for appraisal fees reasonably incurred, in an amount not to exceed ~~$500~~ $1,500, together with relocation costs, moving costs and any other related expenses to which an owner is entitled by sections 117.50 to 117.56. This subdivision does not apply to acquisition for utility purposes made by a public service corporation organized pursuant to section 300.03 or electric cooperative associations organized pursuant to chapter 308A.

Sec. 5. Minnesota Statutes 2002, section 138.40, subdivision 2, is amended to read:

Subd. 2. [COMPLIANCE, ENFORCEMENT, PRESERVATION.] State and other governmental agencies shall comply with and aid in the enforcement of provisions of sections 138.31 to 138.42. Conservation officers and other enforcement officers of the department of natural resources shall enforce the provisions of sections 138.31 to 138.42 and report violations to the director of the society. When archaeological or historic sites are known or, based on <HR><a name=142></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 142</center><HR>scientific investigations or are ~~suspected~~ predicted to exist on public lands or waters, the agency or department controlling said lands or waters shall use the professional services of archaeologists from the University of Minnesota, Minnesota historical society, or other qualified professional archaeologists, to preserve these sites. In the event that archaeological excavation is required to protect or preserve these sites, state and other governmental agencies may use their funds for such activities.

Sec. 6. Minnesota Statutes 2002, section 138.40, subdivision 3, is amended to read:

Subd. 3. [REVIEW OF PLANS.] When significant archaeological or historic sites are known or ~~suspected~~, based on scientific investigations, are predicted to exist on public lands or waters, the agency or department controlling said lands or waters shall submit construction or development plans to the state archaeologist and the director of the society for review prior to the time bids are advertised. The state archaeologist and the society shall promptly review such plans and within 30 days of receiving the plans shall make recommendations for the preservation of archaeological or historic sites which may be endangered by construction or development activities. When archaeological or historic sites are related to Indian history or religion, the state archaeologist shall submit the plans to the Indian affairs council for the council's review and recommend action.

Sec. 7. [160.93] [USER FEES; HIGH-OCCUPANCY VEHICLE LANES.]

Subdivision 1. [FEES AUTHORIZED.] To improve efficiency and provide more options to individuals traveling in a trunk highway corridor, the commissioner of transportation may charge user fees to owners or operators of single-occupant vehicles using designated high-occupancy vehicle lanes. The fees may be collected using electronic or other toll-collection methods and may vary in amount with the time of day and level of traffic congestion within the corridor. The commissioner shall consult with the metropolitan council and obtain necessary federal authorizations before implementing user fees on a high-occupancy vehicle lane. Fees under this section are not subject to section 16A.1283.

Subd. 2. [DEPOSIT OF REVENUES; APPROPRIATION.] Money collected from fees authorized under subdivision 1 must be deposited in a high-occupancy vehicle lane user fee account in the special revenue fund. A separate account must be established for each trunk highway corridor. Money in the account is appropriated to the commissioner. From this appropriation the commissioner shall first repay the trunk highway fund and any other fund source for money spent to install equip or modify the corridor for the purposes of subdivision 1, and then shall pay all the costs of implementing and administering the fee collection system for that corridor. The commissioner shall spend remaining money in the account as follows:

(1) one-half must be spent for transportation capital improvements within the corridor; and

(2) one-half must be transferred to the metropolitan council for expansion and improvement of bus transit services within the corridor beyond the level of service provided on the date of implementation of subdivision 1.

Subd. 3. [EXEMPTIONS.] With respect to this section, the commissioner is exempt from statutory rulemaking requirements, including section 14.386, and from sections 160.84 to 160.92 and 161.162 to 161.167.

Subd. 4. [PROHIBITION.] No person may operate a single occupant vehicle in a designated high-occupancy vehicle lane except in compliance with the requirements of the commissioner. A person who violates this subdivision is guilty of a petty misdemeanor and is subject to sections 169.89, subdivisions 1, 2, and 4, and 169.891 and any other provision of chapter 169 applicable to the commission of a petty misdemeanor traffic offense.

<HR><a name=143></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 143</center><HR> Sec. 8. Minnesota Statutes 2002, section 161.08, is amended to read:

161.08 [~~BOOKS OF ACCOUNT~~ RECORDS AND REPORTS.]

Subdivision 1. [BOOKS OF ACCOUNT.] (a) The commissioner shall keep accurate and complete books of account as may be prescribed by the commissioner of finance, the same to show in detail itemized receipts and disbursements of the trunk highway fund. The books of account shall show the following facts, among others:

(1) the expenses of maintaining the transportation department, including the salaries and expenses of the individual members thereof;

(2) the amounts of money expended in each county of the state for the construction of trunk highways, and when, where, and upon what job or portion of road expended so that the cost per mile of such construction can be easily ascertained;

(3) any other money expended by the state in connection with any roads other than trunk highways and when, where, and upon what portion of road so expended; and

(4) the amount of road equipment and materials purchased, and when, where, and from whom purchased, and the price paid for each item.

(b) The original invoices shall form a part of the permanent files and records in the department of transportation and be open to public inspection.

Subd. 2. [BIENNIAL REPORT.] No later than October 15 of each odd-numbered year, the commissioner shall report to the legislature the total expenditures from the trunk highway fund during the previous biennium in each of the following categories: road construction; planning; professional and technical contracts; design and engineering; labor; compliance with environmental requirements; acquisition of right-of-way; litigation costs, including payment of claims, settlements, and judgments; maintenance; and road operations. As part of each report the commissioner shall select two representative trunk highway construction projects, one each from the department's metropolitan district and from greater Minnesota, and for each project report the cost of environmental mitigation and compliance.

Sec. 9. Minnesota Statutes 2002, section 161.20, subdivision 3, is amended to read:

Subd. 3. [TRUNK HIGHWAY FUND APPROPRIATIONS.] The commissioner may expend trunk highway funds only for trunk highway purposes. Payment of expenses related to ~~sales tax,~~ bureau of criminal apprehension laboratory, office of tourism kiosks, Minnesota safety council, tort claims, driver education programs, emergency medical services board, and Mississippi River parkway commission do not further a highway purpose and do not aid in the construction, improvement, or maintenance of the highway system.

Sec. 10. [161.368] [HIGHWAY MAINTENANCE, DESIGN, AND CONSTRUCTION CONTRACT WITH TRIBAL AUTHORITIES.]

On behalf of the state, the commissioner may enter into agreements with Indian tribal authorities for the purpose of providing maintenance, design, and construction to highways on tribal lands. These agreements may include (1) a provision for waiver of immunity from suit by a party to the contract on the part of the tribal authority with respect to any controversy arising out of the contract and (2) a provision conferring jurisdiction on state district courts to hear such a controversy.

<HR><a name=144></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 144</center><HR> Sec. 11. Minnesota Statutes 2002, section 162.02, subdivision 1, is amended to read:

Subdivision 1. [CREATION.] There is created a county state-aid highway system which must be established, located, constructed, reconstructed, improved, and maintained as public highways by the counties under rules not inconsistent with this section made and promulgated by the commissioner as provided in this chapter. The counties are vested with the rights, title, easements, and their appurtenances, held by or vested in any of the towns or municipal subdivisions or dedicated to the public use prior to the time a road or portion of a road is taken over by the county as a county state-aid highway. If a county state-aid highway is established over a center portion of a street in a city having a population of 5,000 or more, then the remaining portion of the street may be established as a municipal state-aid street.

Sec. 12. Minnesota Statutes 2002, section 162.02, subdivision 2, is amended to read:

Subd. 2. [RULES; ADVISORY COMMITTEE.] The rules shall be made and promulgated by the commissioner acting with the advice of a committee which shall be selected by the several county boards acting through the officers of the statewide association of county commissioners. The committee shall be composed of nine members so selected that each member shall be from a different state highway construction district. Not more than five of the nine members of the committee shall be county commissioners. The remaining members shall be county highway engineers. The committee expires as provided in section 15.059, subdivision 5. In the event that agreement cannot be reached on any rule the commissioner's determination shall be final. The rules shall be printed and copies thereof shall be forwarded to the ~~county auditors and the~~ county engineers of the several counties.

Sec. 13. Minnesota Statutes 2002, section 162.02, subdivision 4, is amended to read:

Subd. 4. [LOCATION AND ESTABLISHMENT; COMMISSIONER'S REVIEW.] The county boards of the several counties shall by resolution and subject to the concurrence of the commissioner locate and establish a system of county state-aid highways in accordance with the rules made and promulgated by the commissioner. It shall be the duty of the commissioner to review each system considering the availability of funds and the desirability of each system in relation to an integrated and coordinated system of highways. After review the commissioner shall by written order approve each system or any part thereof which in the commissioner's judgment is feasible and desirable. A certified copy of the order shall be filed with the ~~county auditor and the~~ county engineer.

Sec. 14. Minnesota Statutes 2002, section 162.09, subdivision 1, is amended to read:

Subdivision 1. [CREATION; MILEAGE LIMITATION; RULES.] There is created a municipal state-aid street system within statutory and home rule charter cities having a population of 5,000 or more. The extent of the municipal state-aid street system for a city shall not exceed: (1) 20 percent of the total miles of city streets and county roads partially or totally within the jurisdiction of that city, plus (2) the mileage of all trunk highways reverted or turned back to the jurisdiction of the city pursuant to law on and after July 1, 1965, plus (3) the mileage of county highways reverted or turned back to the jurisdiction of the city pursuant to law on or after May 11, 1994. For purposes of this subdivision, the total miles of city streets and county roads within the jurisdiction of a city includes all miles of county highways turned back to that city's jurisdiction on or after May 11, 1994. The system shall be established, located, constructed, reconstructed, improved, and maintained as public highways partially or totally within such cities under rules, not inconsistent with this section, made and promulgated by the commissioner as hereinafter provided.

Sec. 15. Minnesota Statutes 2002, section 163.07, subdivision 2, is amended to read:

Subd. 2. [QUALIFICATIONS, SALARY AND TERM.] The county highway engineer shall be a registered highway or civil engineer, registered under the laws of the state of Minnesota. The county highway engineer may be selected from a list of eligible registered highway engineers prepared by the commissioner of transportation. The <HR><a name=145></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 145</center><HR>list shall be submitted by the commissioner of transportation to any county board requesting same. The county board may appoint a new county engineer for a term of only one year. All reappointments shall be for a term of four years, and shall be made in May of the year in which the term expires. The county highway engineer shall be a citizen and resident of this state. The county highway engineer's salary shall be fixed by the county board and shall be payable the same as other county officers are paid. The salary shall not be reduced during the county highway engineer's term of office.

Sec. 16. Minnesota Statutes 2002, section 163.11, is amended by adding a subdivision to read:

Subd. 4a. [DESIGNATION AS COUNTY CARTWAY.] A county board that has vacated a county highway under subdivision 4 may designate, as part of the vacating resolution, the former county highway as a county cartway. A highway designated as a county cartway is a county highway for purposes of this chapter, but the county board may not expend money from its road and bridge fund on the maintenance or improvement of a county cartway unless the county board determines that the expenditure is in the public interest. With the exception of the process provided in subdivision 5a, a county highway right-of-way that has been vacated, extinguished, or otherwise removed from the county highway system may not revert to a town.

Sec. 17. Minnesota Statutes 2002, section 163.11, is amended by adding a subdivision to read:

Subd. 9. [TRANSFER OF JURISDICTION OVER COUNTY HIGHWAY.] Notwithstanding subdivision 5, the county board may transfer jurisdiction and ownership of a county highway to another road authority, an agency of the United States, an agency of the state, or to an Indian tribe upon agreement between the county and the authority, agency, or tribe to which the transfer is being made. Subdivision 5a provides the exclusive method of county highway reversion to towns.

Sec. 18. Minnesota Statutes 2002, section 164.12, is amended to read:

164.12 [ROAD ON TOWN LINE.]

Subdivision 1. [PROPOSAL TO ESTABLISH; MAINTAIN.] When adjoining towns propose to establish, alter, or vacate, or maintain a road on or along the line between such towns they shall proceed as hereinafter provided.

Subd. 2. [DIVISION OF RESPONSIBILITIES.] The town boards shall divide the length of the road proposed to be established, altered, or vacated, or maintained into two parts. When it is proposed to establish or alter a road, the division shall be made so as to divide as nearly equal as possible the cost of right-of-way, construction, and maintenance of the entire road. If the proposal is to vacate a road, the division shall be made so as to divide as nearly equal as possible any damages that may be occasioned thereby.

Subd. 3. [AGREEMENT.] After the division the boards shall enter into an agreement specifying which part shall be vacated, or opened, constructed, and maintained by each. Thereafter, each board shall proceed in the manner and subject to the same review as provided in section 164.06 or section 164.07.

Subd. 4. [JOINT CONTRACT.] When a town line road is established or, altered, or maintained as provided herein, the boards may jointly let a contract covering all or part of the work to be performed on the road. If a joint contract is not let each town board shall open and construct its portion thereof as expeditiously as possible.

Subd. 5. [PORTION OF ROAD TAKEN BY STATE OR COUNTY.] If a portion of a town line road is taken over by the state as a trunk highway, or by a county as a county state-aid highway or county highway, the town boards concerned shall divide the portions of the town line road not taken over by the state or county, so that the cost of construction, reconstruction, and maintenance thereof will be apportioned as nearly equal as possible. After such division the boards shall enter into an agreement specifying which part shall be constructed and maintained by each.

<HR><a name=146></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 146</center><HR> Subd. 6. [FAILURE TO AGREE.] (a) When the town boards cannot agree upon a division as provided in subdivision 2 or subdivision 5, or upon the petition of either town board when a division previously agreed upon has proved to be inequitable, the county board, or where the road is on a county line the county boards of the counties concerned, shall determine the proper division of responsibility. In making such division the county board or boards shall follow the procedure provided for in subdivision 2 or 5. Where deemed necessary the services of the county engineer may be used.

(b) When for any reason an agreement under paragraph (a) cannot be reached, the town board of either or both towns may request to have the matter determined through mediation, arbitration, mediation-arbitration (med-arb), or other form of alternative dispute resolution as described in Rule 114.02 of the General Rules of Practice for the District Courts. The parties may select a neutral who does not qualify under Rule 114.02. Mediated settlement agreements must be in accordance with the Minnesota Civil Mediation Act, sections 572.31 to 572.40. Arbitrated agreements and med-arb agreements must be final and binding.

Sec. 19. Minnesota Statutes 2002, section 168.011, subdivision 22, is amended to read:

Subd. 22. [SPECIAL MOBILE EQUIPMENT.] "Special mobile equipment" means every vehicle not designed or used primarily for the transportation of persons or property and only incidentally operated or moved over a highway, including but not limited to: ditch-digging apparatuses, moving dollies, pump hoists and other water well-drilling equipment registered under chapter 103I, street-sweeping vehicles, and other machinery such as asphalt spreaders, bituminous mixers, bucket loaders, tractors other than truck-tractors, ditchers, leveling graders, finishing machines, motor graders, road rollers, scarifiers, truck-mounted log loaders, earth-moving carryalls, scrapers, power shovels, draglines, self-propelled cranes, and earth-moving equipment. The term does not include travel trailers, dump trucks, truck-mounted transit mixers, truck-mounted feed grinders, or other motor vehicles designed for the transportation of persons or property to which machinery has been attached.

Sec. 20. Minnesota Statutes 2002, section 168.013, subdivision 3, is amended to read:

Subd. 3. [APPLICATION; CANCELLATION; EXCESSIVE GROSS WEIGHT FORBIDDEN.] (a) The applicant for all licenses based on gross weight shall state the unloaded weight of the motor vehicle, trailer, or semitrailer and the maximum load the applicant proposes to carry on it, the sum of which constitutes the gross weight upon which the license tax must be paid. However, the declared gross weight upon which the tax is paid must not be less than 1-1/4 times the declared unloaded weight of the motor vehicle, trailer, or semitrailer to be registered, except recreational vehicles taxed under subdivision 1g, school buses taxed under subdivision 18, and tow trucks or towing vehicles defined in section 169.01, subdivision 52. The gross weight of a tow truck or towing vehicle is the actual weight of the tow truck or towing vehicle fully equipped, but does not include the weight of a wrecked or disabled vehicle towed or drawn by the tow truck or towing vehicle.

(b) The gross weight of a motor vehicle, trailer, or semitrailer must not exceed the gross weight upon which the license tax has been paid by more than four percent or 1,000 pounds, whichever is greater; provided that, a vehicle transporting unfinished forest products on a highway, other than a highway that is part of the system of interstate and defense highways, unless a federal exemption is granted, in accordance with paragraph (d)(3):

(1) shall not exceed its gross vehicle weight upon which the license tax has been paid, or gross axle weight on any axle, by more than five percent and, notwithstanding other law to the contrary, is not subject to any fee, fine, or other assessment or penalty for exceeding a gross vehicle or axle weight by up to five percent; and

(2) between the dates set by the commissioner in accordance with section 169.826, subdivision 1, is not subject to any provision of paragraph (d) or chapter 169 limiting the gross axle weight of any individual axle unless the entire vehicle also exceeds its gross vehicle weight plus its weight allowance allowed in clause (1) and plus any weight allowance permitted under section 169.826, in which case the vehicle is subject to all applicable penalties for excess weight violations.

<HR><a name=147></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 147</center><HR> (c) The gross weight of the motor vehicle, trailer, or semitrailer for which the license tax is paid must be indicated by a distinctive character on the license plate or plates except as provided in subdivision 12 and the plate or plates must be kept clean and clearly visible at all times.

(d) The owner, driver, or user of a motor vehicle, trailer, or semitrailer, upon conviction for transporting a gross weight in excess of the gross weight for which it was registered or for operating a vehicle with an axle weight exceeding the maximum lawful axle load weight, is guilty of a misdemeanor and subject to increased registration or reregistration according to the following schedule:

(1) Upon conviction for transporting a gross weight in excess of the gross weight for which a motor vehicle, trailer, or semitrailer is registered by more than the allowance set forth in paragraph (b) but less than 25 percent, or for operating or using a motor vehicle, trailer, or semitrailer with an axle weight exceeding the maximum lawful axle load as provided in sections 169.822 to 169.829 by more than the allowance set forth in paragraph (b) but less than 25 percent, the owner, driver, or user of the motor vehicle, trailer, or semitrailer used to commit the violation, in addition to any penalty imposed for the misdemeanor, shall apply to the registrar to increase the authorized gross weight to be carried on the vehicle to a weight equal to or greater than the gross weight the owner, driver, or user was convicted of carrying. The increase is computed for the balance of the calendar year on the basis of 1/12 of the annual tax for each month remaining in the calendar year beginning with the first day of the month in which the violation occurred. If the additional registration tax computed upon that weight, plus the tax already paid, amounts to more than the regular tax for the maximum gross weight permitted for the vehicle under sections 169.822 to 169.829, that additional amount must nevertheless be paid into the highway fund, but the additional tax thus paid does not authorize or permit any person to operate the vehicle with a gross weight in excess of the maximum legal weight as provided by sections 169.822 to 169.829. Unless the owner within 30 days after a conviction applies to increase the authorized weight and pays the additional tax as provided in this section, the registrar shall revoke the registration on the vehicle and demand the return of the registration card and plates issued on that registration.

(2) Upon conviction of an owner, driver, or user of a motor vehicle, trailer, or semitrailer for transporting a gross weight in excess of the gross weight for which the motor vehicle, trailer, or semitrailer was registered by 25 percent or more or for operating or using the vehicle or trailer with an axle weight exceeding the maximum lawful axle load as provided in sections 169.822 to 169.829 by 25 percent or more, and in addition to any penalty imposed for the misdemeanor, the registrar shall either (i) cancel the reciprocity privileges on the vehicle involved if the vehicle is being operated under reciprocity or (ii) if the vehicle is not being operated under reciprocity, cancel the certificate of registration on the vehicle operated and demand the return of the registration certificate and registration plates. The registrar may not cancel the registration or reciprocity privileges for any vehicle found in violation of seasonal load restrictions imposed under section 169.87 unless the axle weight exceeds the year-round weight limit for the highway on which the violation occurred. The registrar may investigate any allegation of gross weight violations and demand that the operator show cause why all future operating privileges in the state should not be revoked unless the additional tax assessed is paid.

(3) Clause (1) does not apply to the first haul of unprocessed or raw farm products or unfinished forest products, when the registered gross weight is not exceeded by more than ten percent. For purposes of this clause, "first haul" means (i) the first, continuous transportation of unprocessed or raw farm products from the place of production or on-farm storage site to any other location within 50 miles of the place of production or on-farm storage site, or (ii) the continuous or noncontinuous transportation of unfinished forest products from the place of production to the place of final processing or manufacture located within 200 miles of the place of production.

(4) When the registration on a motor vehicle, trailer, or semitrailer is revoked by the registrar according to this section, the vehicle must not be operated on the highways of the state until it is registered or reregistered, as the case may be, and new plates issued, and the registration fee is the annual tax for the total gross weight of the vehicle at the time of violation. The reregistration pursuant to this subdivision of any vehicle operating under reciprocity agreements pursuant to section 168.181 or 168.187 must be at the full annual registration fee without regard to the percentage of vehicle miles traveled in this state.

<HR><a name=148></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 148</center><HR> Sec. 21. Minnesota Statutes 2002, section 168.12, subdivision 2e, is amended to read:

Subd. 2e. [VOLUNTEER AMBULANCE ATTENDANTS; SPECIAL PLATES.] (a) The registrar shall issue special license plates to an applicant who is a volunteer ambulance attendant as defined in section 144E.001, subdivision 15, and who owns or jointly owns a motor vehicle taxed as a passenger automobile. The registrar shall issue the special plates on payment of the registration tax required by law for the vehicle, compliance with all other applicable laws relating to registration and licensing of motor vehicles and drivers, and payment of an additional fee of $10. The registrar shall not issue more than ~~one set~~ two sets of these plates to each qualified applicant.

(b) A person may use special plates issued under this subdivision only during the period that the person is a volunteer ambulance attendant. When the person to whom the special plates were issued ceases to be a volunteer ambulance attendant, or the person shall return each set of special plates issued to that person. When ownership of ~~the~~ a vehicle is transferred, the person shall remove the special plates from ~~the~~ that vehicle and return them to the registrar. On return of ~~the~~ each set of plates, the owner of the vehicle, or new owner in case of a transferred vehicle, is entitled to receive regular license plates for the vehicle without cost for the rest of the registration period for which the set of special plates were issued. Special plates issued under this subdivision may be transferred to another vehicle owned by the volunteer ambulance attendant on payment of a fee of $5.

(c) The fees specified in this subdivision must be paid into the state treasury and deposited in the highway user tax distribution fund.

(d) The commissioner may adopt rules governing the design, issuance, and sale of the special plates authorized by this subdivision.

Sec. 22. Minnesota Statutes 2002, section 168.12, subdivision 5, is amended to read:

Subd. 5. [ADDITIONAL FEE.] (a) In addition to any fee otherwise authorized or any tax otherwise imposed upon any motor vehicle, the payment of which is required as a condition to the issuance of any number license plate or plates, the commissioner of public safety ~~may~~ shall impose a the fee specified in paragraph (b) that is calculated to cover the cost of manufacturing and issuing the license plate or plates, except for license plates issued to disabled veterans as defined in section 168.031 and license plates issued pursuant to section 168.124, 168.125, or 168.27, subdivisions 16 and 17, for passenger automobiles. Graphic design license plates shall only be issued for vehicles registered pursuant to section 168.017 and recreational vehicles registered pursuant to section 168.013, subdivision 1g.

(b) Unless otherwise specified or exempted by statute, the following plate and validation sticker fees apply for the original, duplicate, or replacement issuance of a plate in a plate year:

Sequential Double Plate $4.25

Sequential Special Plate-Double $7.00

Sequential Single Plate $3.00

Sequential Special Plate-Single $5.50

Self-Adhesive Plate $2.50

Nonsequential Double Plate $14.00

Nonsequential Single Plate $10.00

Duplicate Sticker $1.00

(c) Fees collected under this subdivision must be paid into the state treasury and credited to the highway user tax distribution fund.

<HR><a name=149></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 149</center><HR> Sec. 23. [168.1293] [SPECIAL LICENSE PLATES; AUTHORIZATION; DISCONTINUANCE.]

Subdivision 1. [DEFINITION.] For purposes of this section and section 168.1297 "special license plate" means a license plate that is authorized by law to have wording and graphics that differ from a Minnesota passenger vehicle license plate.

Subd. 2. [SUBMISSIONS TO DEPARTMENT.] (a) A person, legal entity, or other requester, however organized, that plans to seek legislation establishing a new special license plate shall submit the following information and fee to the department of public safety:

(1) The requester shall submit a request for the special license plate being sought, describing the proposed license plate in general terms, the purpose of the plate, and the proposed fee or minimum contribution required for the plate.

(2) The requester shall submit the results of a scientific sample survey of Minnesota motor vehicle owners that indicates that at least 10,000 motor vehicle owners intend to purchase the proposed plate with the proposed fee or minimum contribution. The requester's plan to undertake the survey must be reported to the department before the survey is undertaken. The survey must be performed independently of the requester by another person or legal entity, however organized, that conducts similar sample surveys in the normal course of business.

(3) The requester shall submit an application fee of $20,000, to cover the department's cost of reviewing the application and developing the special license plate if authorized. State funds may not be used to pay the application fee.

(4) The requester shall submit a marketing strategy that contains (i) short-term and long-term marketing plans for the requested plate, and (ii) a financial analysis showing the anticipated revenues and the planned expenditures of any fee or contribution derived from the requested plate.

(b) The requester shall submit the information required under paragraph (a) to the department at least 120 days before the convening of the next regular legislative session at which the requester will submit the proposal.

Subd. 3. [DESIGN; REDESIGN.] (a) If the special license plate sought by the requester is approved by law, the requester shall submit the proposed design for the plate to the department as soon as practicable, but not later than 120 days after the effective date of the law authorizing issuance of the plate. The department is responsible for selecting the final design for the special license plate.

(b) The requester that originally requested a special license plate subsequently approved by law may not submit a new design for the plate within the five years following the date of first issuance of the plate unless the inventory of those plates has been exhausted. The requester may deplete the remaining inventory of the plates by reimbursing the department for the cost of the plates.

Subd. 4. [REFUND OF FEE.] If the special license plate requested is not authorized in the legislative session at which authorization was sought, the department shall refund $17,500 of the application fee to the requester.

Subd. 5. [DISCONTINUANCE OF PLATE.] (a) The department shall discontinue the issuance or renewal of any special license plate if (1) fewer than 1,000 sets of those plates are currently registered at the end of the first six years during which the plates are available, or (2) fewer than 1,000 sets of those plates are currently registered at the end of any subsequent two-year period following the first six years of availability.

<HR><a name=150></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 150</center><HR> (b) The department may discontinue the issuance or renewal of any special license plate, and distribution of any contributions resulting from that plate, if the department determines that (1) the fund or requester receiving the contributions no longer exists, (2) the requester has stopped providing services that are authorized to be funded from the contribution proceeds, (3) the requester has requested discontinuance, or (4) contributions have been used in violation of subdivision 6.

Subd. 6. [USE OF CONTRIBUTIONS.] Contributions made as a condition of obtaining a special license plate, and interest earned on the contributions, may not be spent for commercial or for-profit purposes.

Subd. 7. [DEPOSIT OF FEE; APPROPRIATION.] The commissioner shall deposit the application fee under subdivision 2, paragraph (a), clause (3), in the highway user tax distribution fund. An amount sufficient to pay the department's cost in implementing and administering this section, including payment of refunds under subdivision 4, is appropriated to the commissioner.

Sec. 24. [168.1297] [SPECIAL "ROTARY MEMBER" LICENSE PLATES.]

Subdivision 1. [GENERAL REQUIREMENTS AND PROCEDURES.] The registrar shall issue special "Rotary member" license plates to an applicant who:

(1) is an owner or joint owner of a passenger automobile, pickup truck, or van;

(2) pays a fee of $10 to cover the costs of handling and manufacturing the plates;

(3) pays the registration tax required under section 168.013;

(4) pays the fees required under this chapter;

(5) submits proof to the registrar that the applicant is a member of Rotary International; and

(6) complies with laws and rules governing registration and licensing of vehicles and drivers.

Subd. 2. [DESIGN.] A special license plate under this section consists of a special license plate as described in section 168.1291 with a unique symbol that is the recognized emblem of Rotary International.

Subd. 3. [COMPLIANCE WITH OTHER LAW.] The commissioner shall take no action under this section unless the commissioner determines that Rotary International, or one or more districts of Rotary International, has complied with section 168.1293, subdivision 2, paragraph (a). Issuance and renewal of license plates under this section are subject to section 168.1293, subdivisions 3 to 6.

Sec. 25. Minnesota Statutes 2002, section 168.54, subdivision 4, is amended to read:

Subd. 4. [TRANSFER FEE.] A fee of $2 $3 is imposed upon every transfer of ownership by the commissioner of public safety of any motor vehicle for which a registration certificate has heretofore been issued under this chapter, except vehicles sold for the purposes of salvage or dismantling or permanent removal from the state.

<HR><a name=151></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 151</center><HR> Sec. 26. Minnesota Statutes 2002, section 168A.29, subdivision 1, is amended to read:

Subdivision 1. [AMOUNTS.] (a) The department shall be paid the following fees:

(1) for filing an application for and the issuance of an original certificate of title, the sum of $2 $3;

(2) for each security interest when first noted upon a certificate of title, including the concurrent notation of any assignment thereof and its subsequent release or satisfaction, the sum of $2, except that no fee is due for a security interest filed by a public authority under section 168A.05, subdivision 8;

(3) for the transfer of the interest of an owner and the issuance of a new certificate of title, the sum of $2 $3;

(4) for each assignment of a security interest when first noted on a certificate of title, unless noted concurrently with the security interest, the sum of $1;

(5) for issuing a duplicate certificate of title, the sum of $4.

(b) After June 30, 1994, in addition to each of the fees required under paragraph (a), clauses (1) and (3), the department shall be paid $3.50. The additional fee collected under this paragraph must be deposited in the special revenue fund and credited to the public safety motor vehicle account established in section 299A.70.

Sec. 27. Minnesota Statutes 2002, section 169.14, subdivision 5a, is amended to read:

Subd. 5a. [SPEED ZONING IN SCHOOL ZONE; SURCHARGE.] (a) Local authorities may establish a school speed limit within a school zone of a public or nonpublic school upon the basis of an engineering and traffic investigation as prescribed by the commissioner of transportation. The establishment of a school speed limit on any trunk highway shall be with the consent of the commissioner of transportation. Such school speed limits shall be in effect when children are present, going to or leaving school during opening or closing hours or during school recess periods. The school speed limit shall not be lower than 15 miles per hour and shall not be more than 20 30 miles per hour below the established speed limit on an affected street or highway ~~if the established speed limit is 40 miles per hour or greater~~.

(b) The school speed limit shall be effective upon the erection of appropriate signs designating the speed and indicating the beginning and end of the reduced speed zone. Any speed in excess of such posted school speed limit is unlawful. All such signs shall be erected by the local authorities on those streets and highways under their respective jurisdictions and by the commissioner of transportation on trunk highways.

(c) For the purpose of this subdivision, "school zone" means that section of a street or highway which abuts the grounds of a school where children have access to the street or highway from the school property or where an established school crossing is located provided the school advance sign prescribed by the manual on uniform traffic control devices adopted by the commissioner of transportation pursuant to section 169.06 is in place. All signs erected by local authorities to designate speed limits in school zones shall conform to the manual on uniform control devices.

(d) Notwithstanding section 609.0331 or 609.101 or other law to the contrary, a person who violates a speed limit established under this subdivision is assessed an additional surcharge equal to the amount of the fine imposed for the violation, but not less than $25.

<HR><a name=152></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 152</center><HR> Sec. 28. Minnesota Statutes 2002, section 169.448, subdivision 1, is amended to read:

Subdivision 1. [RESTRICTIONS ON APPEARANCE; MISDEMEANOR.] (a) A bus that is not used as a school bus may not be operated on a street or highway unless it is painted a color significantly different than national school bus glossy yellow.

(b) A bus that is not used as a school bus or Head Start bus may not be operated if it is equipped with school bus or Head Start bus-related equipment and printing.

(d) This subdivision does not apply to a school bus owned by or under contract to a school district operated as a charter or leased bus.

(e) This subdivision does not apply to a school bus operated by a licensed child care provider if:

(1) the stop arm is removed;

(2) the eight-light system is deactivated;

(3) the school bus is identified as a "child care bus" in letters at least eight inches high on the front and rear top of the bus; ~~and~~

(4) the name, address, and telephone number of the owner or operator of the bus is identified on each front door of the bus in letters not less than three inches high; and

(5) the conditions under section 171.02, subdivision 2a, paragraph (b), clauses (1) through (10), (12), and (14) have been met.

[EFFECTIVE DATE.] This section is effective July 1, 2003.

Sec. 29. Minnesota Statutes 2002, section 169.791, subdivision 1, is amended to read:

Subdivision 1. [TERMS DEFINED.] (a) For purposes of this section and sections 169.792 to ~~169.799~~ 169.798, the following terms have the meanings given.

(b) "Commissioner" means the commissioner of public safety.

(c) "District court administrator" or "court administrator" means the district court administrator or a deputy district court administrator of the district court that has jurisdiction of a violation of this section.

(d) "Insurance identification card" means a card issued by an obligor to an insured stating that security as required by section 65B.48 has been provided for the insured's vehicle.

(e) "Law enforcement agency" means the law enforcement agency that employed the peace officer who demanded proof of insurance under this section or section 169.792.

(f) "Peace officer" or "officer" means an employee of a political subdivision or state law enforcement agency, including the Minnesota state patrol, who is licensed by the Minnesota board of peace officer standards and training and is authorized to make arrests for violations of traffic laws.

<HR><a name=153></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 153</center><HR> (g) "Proof of insurance" means an insurance identification card, written statement, or insurance policy as defined by section 65B.14, subdivision 2.

(h) "Vehicle" means a motor vehicle as defined in section 65B.43, subdivision 2, or a motorcycle as defined in section 65B.43, subdivision 13.

(i) "Written statement" means a written statement by a licensed insurance agent stating the name and address of the insured, the vehicle identification number of the insured's vehicle, that a plan of reparation security as required by section 65B.48 has been provided for the insured's vehicle, and the dates of the coverage.

(j) The definitions in section 65B.43 apply to sections 169.792 to ~~169.799~~ 169.798.

Sec. 30. Minnesota Statutes 2002, section 169.796, is amended by adding a subdivision to read:

Subd. 3. [SAMPLING TO VERIFY INSURANCE COVERAGE.] (a) The commissioner of public safety shall implement a monthly sampling program to verify insurance coverage. The sample must annually include at least two percent of all drivers who own motor vehicles, as defined in section 168.011, licensed in the state, one-half of whom during the previous year have been convicted of at least one vehicle insurance law violation, have had a driver's license revoked or suspended due to habitual violation of traffic laws, have had no insurance in effect at the time of a reportable crash, or have been convicted of an alcohol-related motor vehicle offense. No sample may be selected based on race, religion, physical or mental disability, economic status, or geographic location.

(b) The commissioner shall request each vehicle owner included in the sample to furnish insurance coverage information to the commissioner within 30 days. The request must require the owner to state whether or not all motor vehicles owned by that person were insured on the verification date stated in the commissioner's request. The request may require, but is not limited to, a signed statement by the owner that the information is true and correct, the names and addresses of insurers, policy numbers, and expiration or renewal dates of insurance coverage.

(c) The commissioner shall conduct a verification of the response by transmitting necessary information to the insurance companies named in the owner's response.

(d) The insurance companies shall electronically notify the commissioner, within 30 days of the commissioner's request, of any false statements regarding coverage.

(e) The commissioner shall suspend, without preliminary hearing, the driver's license, if any, of a vehicle owner who falsely claims coverage, who indicates that coverage was not in effect at the time specified in the request, or who fails to respond to the commissioner's request to furnish proof of insurance. The commissioner shall comply with the notice requirement of section 171.18, subdivision 2.

(f) Before reinstatement of the driver's license, there must be filed with the commissioner of public safety the written certificate of an insurance carrier authorized to do business in the state stating that security has been provided as required by section 65B.48. The commissioner of public safety may require the certificate of insurance provided to satisfy this subdivision to be certified by the insurance carrier for a period not to exceed one year. The commissioner of public safety may also require a certificate of insurance to be filed with respect to all vehicles required to be insured under section 65B.48 and owned by any person whose driving privileges have been suspended as provided in this section before reinstating the person's driver's license.

Sec. 31. Minnesota Statutes 2002, section 169.797, subdivision 4a, is amended to read:

Subd. 4a. [REGISTRATION REVOCATION AND LICENSE SUSPENSION.] The commissioner of public safety shall revoke the registration of any vehicle and ~~may~~ shall suspend the driver's license of any operator, without preliminary hearing upon a showing by department records, including accident reports required to be submitted by <HR><a name=154></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 154</center><HR>section 169.09, or other sufficient evidence that security required by section 65B.48 has not been provided and maintained. Before reinstatement of the registration, there shall be filed with the commissioner of public safety the written certificate of an insurance carrier authorized to do business in the state stating that security has been provided as required by section 65B.48. The commissioner of public safety may require the certificate of insurance provided to satisfy this subdivision to be certified by the insurance carrier to be noncancelable for a period not to exceed one year. The commissioner of public safety may also require a certificate of insurance to be filed with respect to all vehicles required to be insured under section 65B.48 and owned by any person whose driving privileges have been suspended or revoked as provided in this section before reinstating the person's driver's license.

Sec. 32. Minnesota Statutes 2002, section 169.798, subdivision 1, is amended to read:

Subdivision 1. [AUTHORITY.] The commissioner of public safety shall have the power and perform the duties imposed by this section and sections 65B.41 to 65B.71~~, this section,~~ and ~~sections~~ 169.797 ~~and 169.799,~~ and may adopt rules to implement and provide effective administration of the provisions requiring security and governing termination of security.

Sec. 33. Minnesota Statutes 2002, section 169.798, is amended by adding a subdivision to read:

Subd. 4. [ATTESTATION OF INSURANCE REQUIRED.] Every owner, when applying for motor vehicle or motorcycle registration, reregistration, or transfer of ownership, must attest that the motor vehicle or motorcycle is covered by an insurance policy.

Sec. 34. Minnesota Statutes 2002, section 169.826, subdivision 1, is amended to read:

Subdivision 1. [WINTER INCREASE AMOUNTS.] The limitations provided in sections 169.822 to 169.829 are increased:

~~(1)~~ by ten percent between the dates set by the commissioner for each zone established by the commissioner based on a freezing index model each winter~~, statewide;~~.

(2) by ten percent between the dates set by the commissioner based on a freezing index model each winter, in the zone bounded as follows: beginning at Pigeon River in the northeast corner of Minnesota; thence in a southwesterly direction along the north shore of Lake Superior to the northeastern city limits of Duluth; thence along the eastern and southern city limits of Duluth to the junction with trunk highway No. 210; thence westerly along trunk highway No. 210 to the junction with trunk highway No. 10; thence northwesterly along trunk highway No. 10 to the Minnesota-North Dakota border; thence northerly along that border to the Minnesota-Canadian Border; thence easterly along said Border to Lake Superior; and

~~(3)~~ Subd. 1a. [HARVEST SEASON INCREASE AMOUNT.] The limitations provided in sections 169.822 to 169.829 are increased by ten percent from the beginning of harvest to November 30 each year for the movement of sugar beets, carrots, and potatoes from the field of harvest to the point of the first unloading. Transfer of the product from a farm vehicle or small farm trailer, within the meaning of chapter 168, to another vehicle is not considered to be the first unloading. The commissioner shall not issue permits under this ~~clause~~ subdivision if to do so will result in a loss of federal highway funding to the state.

Sec. 35. Minnesota Statutes 2002, section 169.826, is amended by adding a subdivision to read:

Subd. 1b. [NINE-TON COUNTY ROADS.] Despite the provisions of subdivision 5 and sections 169.824, subdivision 2, paragraph (a), clause (2), and 169.832, subdivision 11, a vehicle or combination of vehicles with a gross vehicle weight up to 88,000 pounds may be operated on a nine-ton county road, consistent with the increases allowed for vehicles operating on a ten-ton road, during the time when the increases under subdivision 1 are in effect in that zone.

<HR><a name=155></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 155</center><HR> Sec. 36. Minnesota Statutes 2002, section 169.85, subdivision 2, is amended to read:

Subd. 2. [UNLOADING.] (a) Upon weighing a vehicle and load, as provided in this section, an officer may require the driver to stop the vehicle in a suitable place and remain standing until a portion of the load is removed that is sufficient to reduce the gross weight of the vehicle to the limit permitted under either section 168.013, subdivision 3, paragraph (b), or sections 169.822 to 169.829, whichever is the lesser violation, if any. A suitable place is a location where loading or tampering with the load is not prohibited by federal, state, or local law, rule, or ordinance.

(b) Except as provided in paragraph (c), a driver may be required to unload a vehicle only if the weighing officer determines that (1) on routes subject to the provisions of sections 169.822 to 169.829, the weight on an axle exceeds the lawful gross weight prescribed by sections 169.822 to 169.829, by 2,000 pounds or more, or the weight on a group of two or more consecutive axles in cases where the distance between the centers of the first and last axles of the group under consideration is ten feet or less exceeds the lawful gross weight prescribed by sections 169.822 to 169.829, by 4,000 pounds or more; or (2) on routes designated by the commissioner in section 169.832, subdivision 11, the overall weight of the vehicle or the weight on an axle or group of consecutive axles exceeds the maximum lawful gross weights prescribed by sections 169.822 to 169.829; or (3) the weight is unlawful on an axle or group of consecutive axles on a road restricted in accordance with section 169.87. Material unloaded must be cared for by the owner or driver of the vehicle at the risk of the owner or driver.

(c) If the gross weight of the vehicle does not exceed the vehicle's registered gross weight plus the weight allowance set forth in section 168.013, subdivision 3, paragraph (b), and plus, if applicable, the weight allowance permitted under section 169.826, then the driver is not required to unload under paragraph (b).

Sec. 37. Minnesota Statutes 2002, section 169.86, subdivision 5, is amended to read:

Subd. 5. [FEE; PROCEEDS TO TRUNK HIGHWAY FUND.] The commissioner, with respect to highways under the commissioner's jurisdiction, may charge a fee for each permit issued. All such fees for permits issued by the commissioner of transportation shall be deposited in the state treasury and credited to the trunk highway fund. Except for those annual permits for which the permit fees are specified elsewhere in this chapter, the fees shall be:

(a) $15 for each single trip permit.

(b) $36 for each job permit. A job permit may be issued for like loads carried on a specific route for a period not to exceed two months. "Like loads" means loads of the same product, weight, and dimension.

(c) $60 for an annual permit to be issued for a period not to exceed 12 consecutive months. Annual permits may be issued for:

(1) motor vehicles used to alleviate a temporary crisis adversely affecting the safety or well-being of the public;

(2) motor vehicles which travel on interstate highways and carry loads authorized under subdivision 1a;

(3) motor vehicles operating with gross weights authorized under section 169.826, subdivision ~~1, clause (3)~~ 1a;

(4) special pulpwood vehicles described in section 169.863;

(5) motor vehicles bearing snowplow blades not exceeding ten feet in width; and

(6) noncommercial transportation of a boat by the owner or user of the boat.

<HR><a name=156></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 156</center><HR> (d) $120 for an oversize annual permit to be issued for a period not to exceed 12 consecutive months. Annual permits may be issued for:

(1) mobile cranes;

(2) construction equipment, machinery, and supplies;

(3) manufactured homes;

(4) implements of husbandry when the movement is not made according to the provisions of paragraph (i);

(5) double-deck buses;

(6) commercial boat hauling.

(e) For vehicles which have axle weights exceeding the weight limitations of sections 169.822 to 169.829, an additional cost added to the fees listed above. However, this paragraph applies to any vehicle described in section 168.013, subdivision 3, paragraph (b), but only when the vehicle exceeds its gross weight allowance set forth in that paragraph, and then the additional cost is for all weight, including the allowance weight, in excess of the permitted maximum axle weight. The additional cost is equal to the product of the distance traveled times the sum of the overweight axle group cost factors shown in the following chart:

Overweight Axle Group Cost Factors

Cost Per Mile For Each Group Of:

Weight (pounds)

exceeding Two consecutive Three consecutive Four consecutive

weight limitations axles spaced within axles spaced within axles spaced within

on axles 8 feet or less 9 feet or less 14 feet or less

0-2,000 .12 .05 .04

2,001-4,000 .14 .06 .05

4,001-6,000 .18 .07 .06

6,001-8,000 .21 .09 .07

8,001-10,000 .26 .10 .08

10,001-12,000 .30 .12 .09

12,001-14,000 Not permitted .14 .11

14,001-16,000 Not permitted .17 .12

16,001-18,000 Not permitted .19 .15

18,001-20,000 Not permitted Not permitted .16

20,001-22,000 Not permitted Not permitted .20

The amounts added are rounded to the nearest cent for each axle or axle group. The additional cost does not apply to paragraph (c), clauses (1) and (3).

For a vehicle found to exceed the appropriate maximum permitted weight, a cost-per-mile fee of 22 cents per ton, or fraction of a ton, over the permitted maximum weight is imposed in addition to the normal permit fee. Miles must be calculated based on the distance already traveled in the state plus the distance from the point of detection to a transportation loading site or unloading site within the state or to the point of exit from the state.

<HR><a name=157></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 157</center><HR> (f) As an alternative to paragraph (e), an annual permit may be issued for overweight, or oversize and overweight, construction equipment, machinery, and supplies. The fees for the permit are as follows:

Gross Weight (pounds) of Vehicle Annual Permit Fee

90,000 or less $200

90,001 - 100,000 $300

100,001 - 110,000 $400

110,001 - 120,000 $500

120,001 - 130,000 $600

130,001 - 140,000 $700

140,001 - 145,000 $800

If the gross weight of the vehicle is more than 145,000 pounds the permit fee is determined under paragraph (e).

(g) For vehicles which exceed the width limitations set forth in section 169.80 by more than 72 inches, an additional cost equal to $120 added to the amount in paragraph (a) when the permit is issued while seasonal load restrictions pursuant to section 169.87 are in effect.

(h) $85 for an annual permit to be issued for a period not to exceed 12 months, for refuse-compactor vehicles that carry a gross weight of not more than: 22,000 pounds on a single rear axle; 38,000 pounds on a tandem rear axle; or, subject to section 169.828, subdivision 2, 46,000 pounds on a tridem rear axle. A permit issued for up to 46,000 pounds on a tridem rear axle must limit the gross vehicle weight to not more than 62,000 pounds.

(i) For vehicles exclusively transporting implements of husbandry, an annual permit fee of $24. A vehicle operated under a permit authorized by this paragraph may be moved at the discretion of the permit holder without prior route approval by the commissioner if:

(1) the total width of the transporting vehicle, including load, does not exceed 14 feet;

(2) the vehicle is operated only between sunrise and 30 minutes after sunset, and is not operated at any time after 12:00 noon on Sundays or holidays;

(3) the vehicle is not operated when visibility is impaired by weather, fog, or other conditions that render persons and other vehicles not clearly visible at 500 feet;

(4) the vehicle displays at the front and rear of the load or vehicle a pair of flashing amber lights, as provided in section 169.59, subdivision 4, whenever the overall width of the vehicle exceeds 126 inches; and

(5) the vehicle is not operated on a trunk highway with a surfaced roadway width of less than 24 feet unless such operation is authorized by the permit.

A permit under this paragraph authorizes movements of the permitted vehicle on an interstate highway, and movements of 75 miles or more on other highways.

Sec. 38. Minnesota Statutes 2002, section 171.02, subdivision 2a, is amended to read:

Subd. 2a. [EXCEPTIONS.] (a) Notwithstanding subdivision 2, (1) a hazardous materials endorsement is not required to operate a vehicle having a gross vehicle weight of 26,000 pounds or less while carrying in bulk tanks a total of not more than 200 gallons of petroleum products and (2) a class C license or hazardous materials endorsement is not required to operate a farm vehicle as defined in Code of Federal Regulations, title 49, section 390.5, having a gross vehicle weight of 26,000 pounds or less while carrying in bulk tanks a total of not more than 1,500 gallons of liquid fertilizer.

<HR><a name=158></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 158</center><HR> (b) Notwithstanding subdivision 2, paragraph (c), the holder of a class D driver's license, without a school bus endorsement, may operate a type A school bus described in subdivision 2, paragraph (b), under the following conditions:

(1) The operator is an employee of the entity that owns, leases, or contracts for the school bus and is not solely hired to provide transportation services under this paragraph.

(2) The operator drives the school bus only from points of origin to points of destination, not including home-to-school trips to pick up or drop off students.

(3) The operator is prohibited from using the eight-light system. Violation of this clause is a misdemeanor.

(4) The operator's employer has adopted and implemented a policy that provides for annual training and certification of the operator in:

(i) safe operation of the type of school bus the operator will be driving;

(ii) understanding student behavior, including issues relating to students with disabilities;

(iii) encouraging orderly conduct of students on the bus and handling incidents of misconduct appropriately;

(iv) knowing and understanding relevant laws, rules of the road, and local school bus safety policies;

(v) handling emergency situations; and

(vi) safe loading and unloading of students.

(5) A background check or background investigation of the operator has been conducted that meets the requirements under section 122A.18, subdivision 8, or 123B.03 for teachers; section 144.057 or 245A.04 for day care employees; or section 171.321, subdivision 3, for all other persons operating a type A school bus under this paragraph.

(6) Operators shall submit to a physical examination as required by section 171.321, subdivision 2.

(7) The operator's driver's license is verified annually by the entity that owns, leases, or contracts for the school bus.

(8) A person who sustains a conviction, as defined under section 609.02, of violating section 169A.25, 169A.26, 169A.27, 169A.31, 169A.51, or 169A.52, or a similar statute or ordinance of another state is precluded from operating a school bus for five years from the date of conviction.

(9) A person who has ever been convicted of a disqualifying offense as defined in section 171.3215, subdivision 1, paragraph (c), may not operate a school bus under this paragraph.

(10) A person who sustains a conviction, as defined under section 609.02, of a fourth moving offense in violation of chapter 169 is precluded from operating a school bus for one year from the date of the last conviction.

~~(10)~~ (11) Students riding the school bus must have training required under section 123B.90, subdivision 2.

<HR><a name=159></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 159</center><HR> ~~(11)~~ (12) An operator must be trained in the proper use of child safety restraints as set forth in the National Highway Traffic Safety Administration's "Guideline for the Safe Transportation of Pre-school Age Children in School Buses."

~~(12)~~ (13) Annual certification of the requirements listed in this paragraph must be maintained under separate file at the business location for each operator licensed under this paragraph and subdivision 2, paragraph (b), clause (5). The business manager, school board, governing body of a nonpublic school, or any other entity that owns, leases, or contracts for the school bus operating under this paragraph is responsible for maintaining these files for inspection.

~~(13)~~ (14) The school bus must bear a current certificate of inspection issued under section 169.451.

~~(14)~~ (15) The word "School" on the front and rear of the bus must be covered by a sign that reads "Activities" when the bus is being operated under authority of this paragraph.

[EFFECTIVE DATE.] This section is effective August 1, 2003.

Sec. 39. Minnesota Statutes 2002, section 171.20, subdivision 4, is amended to read:

Subd. 4. [REINSTATEMENT FEE.] (a) Before the license is reinstated, (1) a person whose driver's license has been suspended under section 171.16, subdivision 2; 171.18, except subdivision 1, clause (10); or 171.182, or who has been disqualified from holding a commercial driver's license under section 171.165, and (2) a person whose driver's license has been suspended under section 171.186 and who is not exempt from such a fee, must pay a fee of $20.

(b) Before the license is reinstated, a person whose license has been suspended or revoked under sections 169.791 to 169.798 must pay a $20 reinstatement fee.

(c) When fees are collected by a licensing agent appointed under section 171.061, a handling charge is imposed in the amount specified under section 171.061, subdivision 4. The reinstatement fee and surcharge must be deposited in an approved state depository as directed under section 171.061, subdivision 4.

(d) A suspension may be rescinded without fee for good cause.

Sec. 40. Minnesota Statutes 2002, section 171.29, subdivision 2, is amended to read:

Subd. 2. [REINSTATEMENT FEES AND SURCHARGES, ALLOCATION.] (a) A person whose driver's license has been revoked as provided in subdivision 1, except under section 169A.52, 169A.54, or 609.21, shall pay a $30 fee before the driver's license is reinstated.

(b) A person whose driver's license has been revoked as provided in subdivision 1 under section 169A.52, 169A.54, or 609.21, shall pay a $250 fee plus a $40 surcharge before the driver's license is reinstated. Beginning July 1, 2002, the surcharge is $145. Beginning July 1, 2003, the surcharge is ~~$380~~ $430. The $250 fee is to be credited as follows:

(1) Twenty percent must be credited to the trunk highway fund.

(2) Sixty-seven percent must be credited to the general fund.

(3) Eight percent must be credited to a separate account to be known as the bureau of criminal apprehension account. Money in this account may be appropriated to the commissioner of public safety and the appropriated amount must be apportioned 80 percent for laboratory costs and 20 percent for carrying out the provisions of section 299C.065.

<HR><a name=160></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 160</center><HR> (4) Five percent must be credited to a separate account to be known as the vehicle forfeiture account, which is created in the special revenue fund. The money in the account is annually appropriated to the commissioner for costs of handling vehicle forfeitures.

(c) The revenue from $50 of each surcharge must be credited to a separate account to be known as the traumatic brain injury and spinal cord injury account. The money in the account is annually appropriated to the commissioner of health to be used as follows: ~~35 percent for a contract with a~~ 83 percent for contracts with a qualified community-based organization to provide information, resources, and support to assist persons with traumatic brain injury and their families to access services, and 65 17 percent to maintain the traumatic brain injury and spinal cord injury registry created in section 144.662. For the purposes of this clause, a "qualified community-based organization" is a private, not-for-profit organization of consumers of traumatic brain injury services and their family members. The organization must be registered with the United States Internal Revenue Service under section 501(c)(3) as a tax-exempt organization and must have as its purposes:

(i) the promotion of public, family, survivor, and professional awareness of the incidence and consequences of traumatic brain injury;

(ii) the provision of a network of support for persons with traumatic brain injury, their families, and friends;

(iii) the development and support of programs and services to prevent traumatic brain injury;

(iv) the establishment of education programs for persons with traumatic brain injury; and

(v) the empowerment of persons with traumatic brain injury through participation in its governance.

No patient's name, identifying information, or identifiable medical data will be disclosed to the organization without the informed voluntary written consent of the patient or patient's guardian or, if the patient is a minor, of the parent or guardian of the patient.

~~(c)~~ (d) The remainder of the surcharge must be credited to a separate account to be known as the remote electronic alcohol-monitoring program account. The commissioner shall transfer the balance of this account to the commissioner of finance on a monthly basis for deposit in the general fund.

~~(d)~~ (e) When these fees are collected by a licensing agent, appointed under section 171.061, a handling charge is imposed in the amount specified under section 171.061, subdivision 4. The reinstatement fees and surcharge must be deposited in an approved state depository as directed under section 171.061, subdivision 4.

Sec. 41. Minnesota Statutes 2002, section 174.03, is amended by adding a subdivision to read:

Subd. 9. [FORECAST OF REVENUES AND EXPENDITURES.] In cooperation with the department of finance and as required by section 16A.103, the commissioner shall prepare in February and November of each year a forecast of highway user tax distribution fund and trunk highway fund revenues and expenditures. The forecast must include an analysis of economic information and the potential impact on highway user fund revenues, historical growth rate information, and other variables affecting revenue assumptions and forecasted future growth rates. The forecast must include an analysis of trunk highway bonding and the necessary debt service payments, and assumptions regarding federal transportation funds. The commissioner shall review the forecast information with the chairs of the senate and house of representatives committees with jurisdiction over finance, way and means, and transportation finance and with legislative fiscal staff no later than two weeks before the forecast is released and shall inform the chairs and staff of changes made from previous forecasts.

<HR><a name=161></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 161</center><HR> Sec. 42. Minnesota Statutes 2002, section 174.24, subdivision 1, is amended to read:

Subdivision 1. [ESTABLISHMENT; PURPOSE.] A public transit participation program is established to carry out the objectives stated in section 174.21 by providing financial assistance from the state, including the greater Minnesota transit fund established in section 16A.88, to eligible recipients outside of the metropolitan area.

Sec. 43. Minnesota Statutes 2002, section 174.24, subdivision 3b, is amended to read:

Subd. 3b. [OPERATING ASSISTANCE.] (a) The commissioner shall determine the total operating cost of any public transit system receiving or applying for assistance in accordance with generally accepted accounting principles. To be eligible for financial assistance, an applicant or recipient shall provide to the commissioner all financial records and other information and shall permit any inspection reasonably necessary to determine total operating cost and correspondingly the amount of assistance ~~which~~ that may be paid to the applicant or recipient. Where more than one county or municipality contributes assistance to the operation of a public transit system, the commissioner shall identify one as lead agency for the purpose of receiving money under this section.

(b) Prior to distributing operating assistance to eligible recipients for any contract period, the commissioner shall place all recipients into one of the following classifications: urbanized area service, small urban area service, rural area service, and elderly and handicapped service. The commissioner shall distribute funds under this section so that the percentage of total operating cost paid by any recipient from local sources will not exceed the percentage for that recipient's classification, except as provided in an undue hardship case. The percentages must be: for urbanized area service and small urban area service, 40 20 percent; for rural area service, 35 15 percent; and for elderly and handicapped service, 35 15 percent. The remainder of the total operating cost will be paid from state funds less any assistance received by the recipient from any federal source. For purposes of this subdivision "local sources" means ~~payments under section 174.242 plus~~ all local sources of funds and includes all operating revenue, tax levies, and contributions from public funds, except that the commissioner may exclude from the total assistance contract revenues derived from operations the cost of which is excluded from the computation of total operating cost. Total operating costs of the Duluth transit authority or a successor agency ~~shall~~ does not include costs related to the Superior, Wisconsin service contract and the independent school district No. 709 service contract. For calendar years 2004 and 2005, to enable public transit systems to meet the provisions of this section the commissioner may adjust payments of financial assistance to recipients that were under a contract with the department on January 1, 2003. Payments to such a recipient in calendar years 2004 and 2005 from the greater Minnesota transit fund, may not be less than the payment to the recipient from that fund in calendar year 2003, except for reductions made necessary by reductions in base funding for those years.

(c) If a recipient informs the commissioner in writing after the establishment of these percentages but prior to the distribution of financial assistance for any year that paying its designated percentage of total operating cost from local sources will cause undue hardship, the commissioner may reduce the percentage to be paid from local sources by the recipient and increase the percentage to be paid from local sources by one or more other recipients inside or outside the classification~~, provided that no recipient shall have its~~. However, the commissioner may not reduce or increase any recipient's percentage ~~thus reduced or increased~~ under this paragraph for more than two years successively. If for any year the funds appropriated to the commissioner to carry out the purposes of this section are insufficient to allow the commissioner to pay the state share of total operating cost as provided in this paragraph, the commissioner shall reduce the state share in each classification to the extent necessary.

Sec. 44. Minnesota Statutes 2002, section 174.24, subdivision 5, is amended to read:

Subd. 5. [METHOD OF PAYMENT, OPERATING ASSISTANCE.] Payments for operating assistance under this section ~~shall~~ must be made in the following manner:

(a) For payments made from the general fund:

<HR><a name=162></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 162</center><HR> (1) 50 percent of the total contract amount in the first month of operation;

(2) 40 percent of the total contract amount in the seventh month of operation;

(3) 9 percent of the total contract amount in the 12th month of operation; and

(4) 1 percent of the total contract amount after the final audit.

(b) For payments made from the greater Minnesota transit fund:

(1) 50 percent of the total contract amount in the seventh month of operation; and

(2) 50 percent of the total contract amount in the 11th month of operation.

Sec. 45. Minnesota Statutes 2002, section 174.55, subdivision 2, is amended to read:

Subd. 2. [COMPOSITION.] The major transportation projects commission is composed of the governor or the governor's designee; four citizen members appointed by the governor and serving at the pleasure of the governor; seven senators appointed by the subcommittee on committees of the committee on rules and administration, three of whom must not be members of the senate majority party; and seven members of the house of representatives appointed by the speaker, three of whom must not be members of the house majority party. The commissioner of transportation shall serve as a nonvoting member unless the commissioner is the governor's designee. The commission shall elect a chair from among its members. Nongovernment members of the commission shall receive compensation in accordance with section 15.059, subdivision 3. The commission expires June 30, 2003.

Sec. 46. Minnesota Statutes 2002, section 174.64, subdivision 4, is amended to read:

Subd. 4. [HEARINGS; NOTICE.] With respect to those matters within the commissioner's jurisdiction, the commissioner shall receive, hear, and determine all petitions filed with the commissioner in accordance with the procedures established by law and may hold hearings and make determinations upon the commissioner's own motion to the same extent, and in every instance, in which the commissioner may do so upon petition. Upon receiving ~~petitions~~ a petition filed pursuant to ~~sections~~ section 221.121, subdivision 1, or 221.151, ~~and 221.55,~~ the commissioner shall give notice of the filing of the petition to representatives of associations or other interested groups or persons who have registered their names with the commissioner for that purpose and to whomever the commissioner deems to be interested in the petition. The commissioner may grant or deny the request of the petition 30 days after notice of the filing has been fully given. If the commissioner receives a written objection and notice of intent to appear at a hearing to object to the petition from any person within 20 days of the notice having been fully given, the request of the petition must be granted or denied only after a contested case hearing has been conducted on the petition, unless the objection is withdrawn before the hearing. The commissioner may elect to hold a contested case hearing if no objections to the petition are received. If a timely objection is not received, or if received and withdrawn, and the request of the petition is denied without hearing, the petitioner may request within 30 days of receiving the notice of denial, and must be granted, a contested case hearing on the petition.

Sec. 47. Minnesota Statutes 2002, section 275.71, subdivision 5, is amended to read:

Subd. 5. [PROPERTY TAX LEVY LIMIT.] Notwithstanding any other provision of a municipal charter which limits ad valorem taxes to a lesser amount, or which would require a separate voter approval for any increase, for taxes levied in 2001 and 2002, the property tax levy limit for a local governmental unit is equal to its adjusted levy limit base determined under subdivision 4 plus any additional levy authorized under section 275.73, which is levied against net tax capacity, reduced by the sum of (i) the total amount of aids and reimbursements that the local governmental unit is certified to receive under sections 477A.011 to 477A.014, except for the increases in city aid <HR><a name=163></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 163</center><HR>bases in calendar year 2002 under section 477A.011, subdivision 36, paragraphs (n), (p), and (q), (ii) homestead and agricultural aids it is certified to receive under section 273.1398, (iii) taconite aids under sections 298.28 and 298.282 including any aid which was required to be placed in a special fund for expenditure in the next succeeding year, and (iv) low-income housing aid under sections 477A.06 and 477A.065~~, and (v) property tax replacement aids under section 174.242~~.

Sec. 48. Minnesota Statutes 2002, section 297B.09, subdivision 1, is amended to read:

Subdivision 1. [DEPOSIT OF REVENUES.] (a) Money collected and received under this chapter must be deposited as provided in this subdivision.

(b) From July 1, 2001, to June 30, 2002, 30.86 percent of the money collected and received must be deposited in the highway user tax distribution fund, and the remaining money must be deposited in the general fund.

~~(c) On and after~~ From July 1, 2002, to June 30, 2003, 32 percent of the money collected and received must be deposited in the highway user tax distribution fund, 20.5 percent must be deposited in the metropolitan area transit fund under section 16A.88, and 1.25 percent must be deposited in the greater Minnesota transit fund under section 16A.88. ~~In fiscal year 2004 and thereafter, two percent of the money collected and received must be deposited in the metropolitan area transit appropriation account under section 16A.88.~~ The remaining money must be deposited in the general fund.

(c) From July 1, 2003, to June 30, 2007, 30 percent of the money collected and received must be deposited in the highway user tax distribution fund, 21.5 percent must be deposited in the metropolitan area transit fund under section 16A.88, 1.43 percent must be deposited in the greater Minnesota transit fund under section 16A.88, 0.65 percent must be deposited in the county state-aid highway fund, and 0.17 percent must be deposited in the municipal state-aid street fund. The remaining money must be deposited in the general fund.

(d) On and after July 1, 2007, 32 percent of the money collected and received must be deposited in the highway user tax distribution fund, 20.5 percent must be deposited in the metropolitan area transit fund under section 16A.88, and 1.25 percent must be deposited in the greater Minnesota transit fund under section 16A.88. The remaining money must be deposited in the general fund.

Sec. 49. Minnesota Statutes 2002, section 299A.465, subdivision 4, is amended to read:

Subd. 4. [PUBLIC EMPLOYER REIMBURSEMENT.] A public employer subject to this section may annually apply by August 1 for the preceding fiscal year to the commissioner of public safety for reimbursement to help defray a portion of its costs of complying with this section. The commissioner shall provide ~~reimbursement~~ an equal pro rata share to the public employer out of the public safety officer's benefit account based on the availability of funds for each eligible officer, firefighter, and qualifying dependents. Individual shares must not exceed the actual costs of providing coverage under this section by a public employer.

Sec. 50. [299A.77] [ALCOHOL ENFORCEMENT ACCOUNT.]

(a) An alcohol enforcement account is created in the special revenue fund, consisting of money credited to the account by law. Money in the account may be appropriated by law for (1) costs of the alcohol and gambling division related to administration and enforcement of sections 340A.403, subdivision 4; 340A.414, subdivision 1a; and 340A.504, subdivision 7; and (2) costs of the state patrol.

(b) The commissioner shall transfer from the account to the trunk highway fund $3,500,000 in fiscal year 2004 and $3,700,000 in fiscal year 2005, or so much thereof as is necessary to pay costs of adding state patrol positions.

<HR><a name=164></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 164</center><HR> Sec. 51. [299A.80] [ADMINISTRATIVE POWERS AND PENALTIES; GENERAL.]

Subdivision 1. [DEFINITIONS.] (a) For purposes of sections 299A.80 to 299A.802, the terms defined in this subdivision have the meanings given them.

(b) "Administrative agent" means a person or entity licensed by or granted authority by the commissioner of public safety under:

(1) section 168.33 as a deputy registrar;

(2) section 168C.11 as a deputy registrar of bicycles; or

(3) section 171.061 as a driver's license agent.

(c) "Other authority" means licenses, orders, stipulation agreements, settlements, or compliance agreements adopted or issued by the commissioner of public safety.

(d) "Commissioner" means the commissioner of public safety.

(e) "License" means a license, permit, registration, appointment, or certificate issued or granted to an administrative agent by the commissioner of public safety.

Subd. 2. [APPLICABILITY.] Sections 299A.80 to 299A.802 apply to administrative agents licensed by or subject to other authority of the commissioner.

Subd. 3. [CUMULATIVE REMEDY.] The authority of the commissioner to issue a corrective order or assess an administrative penalty under sections 299A.80 to 299A.802 is in addition to other remedies available under statutory or common law, except that the state may not seek a civil penalty under any other law for a violation covered by an administrative penalty order. The payment of a penalty does not preclude the use of other enforcement provisions, under which civil fines are not assessed, in connection with the violation for which the penalty was assessed.

Subd. 4. [ACCESS TO INFORMATION AND PROPERTY.] The commissioner, an employee, or an agent authorized by the commissioner, upon presentation of credentials, may:

(1) examine and copy any books, papers, records, memoranda, or data of an administrative agent; and

(2) enter upon any property where an administrative agent conducts its place of business to take actions authorized under statute, rule, or other authority, including (i) obtaining information from an administrative agent who has a duty to provide information under statute, rule, or other authority, (ii) taking steps to remedy violations, or (iii) conducting surveys or investigations.

Subd. 5. [FALSE INFORMATION.] (a) An administrative agent may not:

(1) make a false material statement, representation, or certification in a required document;

(2) omit material information from a required document; or

(3) alter, conceal, or fail to file or maintain a required document.

<HR><a name=165></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 165</center><HR> (b) In this section, "required document" means a notice, application, record, report, plan, or other document required under statute, rule, or other authority.

Subd. 6. [ENFORCEMENT.] (a) The attorney general may proceed on behalf of the state to enforce administrative penalties that are due and payable under section 299A.802 in any manner provided by law for the collection of debts.

(b) The attorney general may petition the district court to file a final administrative penalty order as an order of the court. At any court hearing to enforce a final administrative penalty order, the only issues the parties may contest are procedural and notice issues. Once entered, the administrative penalty order may be enforced in the same manner as a final judgment of the district court. This paragraph does not preclude district court review of the merits of an administrative penalty order if the order is appealed by the administrative agent under section 299A.802, subdivision 5.

(c) If an administrative agent fails to pay an administrative penalty, the attorney general may bring a civil action in district court seeking payment of the penalty, injunctive relief, or other appropriate relief including monetary damages, attorney fees, costs, and interest.

Subd. 7. [RECOVERY OF REASONABLE COSTS AND ATTORNEY FEES.] (a) In any judicial action brought by the attorney general for civil penalties, injunctive relief, or an action to compel performance pursuant to this section, if the state finally prevails, and if the proven violation was willful, the state, in addition to other penalties provided by law, may be allowed an amount determined by the court to be the reasonable value of all or part of the costs and attorney fees incurred by the state or the prevailing party. In determining the amount of the reasonable costs and attorney fees to be allowed, the court must give consideration to the economic circumstances of the defendant.

(b) However, if a defendant prevails, the court may award the reasonable value of all or part of the reasonable costs and attorney fees incurred by the defendant.

Subd. 8. [EDUCATION AND COMPLIANCE ACCOUNT; MONEY ALLOCATED.] An education and compliance account is created for the deposit of administrative penalty order receipts. Of the funds deposited in this account, $5,000 each year is appropriated to the commissioner for education and compliance activities related to the regulated parties affected by this chapter. At the end of each biennium, all money not expended lapses to the general fund.

Subd. 9. [PLAN FOR USING ADMINISTRATIVE PENALTIES AND CEASE AND DESIST AUTHORITY.] The commissioner shall prepare a plan for using the administrative penalty order and cease and desist authority in this section. The commissioner shall provide a 30-day period for public comment on the plan. The plan must be finalized by July 1, 2004, and may be modified as necessary upon subsequent notice and opportunity for comment.

Sec. 52. [299A.801] [CORRECTIVE ORDERS AND INJUNCTIONS.]

Subdivision 1. [CORRECTIVE ORDERS.] (a) Before seeking an administrative penalty order under section 299A.802, the commissioner must issue a corrective order that requires the administrative agent to correct the violation of statute, rule, or other authority. The corrective order must state the deficiencies that constitute the violation of the specific statute, rule, or other authority, and the time by which the violation must be corrected. In addition to service by certified mail on the administrative agent, a copy of the corrective order must be given to the county auditor in the county where the administrative agent is located.

<HR><a name=166></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 166</center><HR> (b) The administrative agent to whom the corrective order was issued shall provide information to the commissioner, by the due date stated in the corrective order, demonstrating that the violation has been corrected or that the administrative agent has developed a corrective plan acceptable to the commissioner. The commissioner must determine whether the violation has been corrected and notify the administrative agent subject to the order of the commissioner's determination.

(c) If the administrative agent believes that the information contained in the commissioner's corrective order is in error, the administrative agent may ask the commissioner to reconsider the parts of the corrective order that are alleged to be in error. The request must:

(1) be in writing;

(2) be delivered to the commissioner by certified mail within seven calendar days after receipt of the corrective order;

(3) specify which parts of the corrective order are alleged to be in error and explain why they are in error; and

(4) provide documentation to support the allegation of error.

(d) The commissioner shall respond to requests made under paragraph (c) within 15 calendar days after receiving a request. A request for reconsideration does not stay the corrective order; however, after reviewing the request for reconsideration, the commissioner may provide additional time to comply with the order if necessary. The commissioner's disposition of a request for reconsideration of a corrective order is final.

Subd. 2. [CEASE AND DESIST ORDER.] The commissioner, or an employee of the department designated by the commissioner, may issue an order to cease an activity otherwise authorized by statute, rule, or other authority if continuation of the activity would result in an immediate risk to public safety. A cease and desist order issued under this subdivision is effective for a maximum of 72 hours. In conjunction with issuing the cease and desist order, the commissioner may post a sign to cease an activity until the cease and desist order is lifted and the sign is removed by the commissioner. To restrain activities for a period beyond 72 hours, the commissioner must seek an injunction or take other administrative action authorized by law. The issuance of a cease and desist order does not preclude the commissioner from pursuing any other enforcement action available to the commissioner.

Subd. 3. [ACTION FOR INJUNCTIVE RELIEF.] In addition to any other remedy provided by law, the commissioner may bring an action for injunctive relief in the district court in Ramsey county or, at the commissioner's discretion, in the district court in the county in which a violation of a statute, rule, or other authority has occurred to enjoin the violation.

Sec. 53. [299A.802] [ADMINISTRATIVE PENALTY ORDERS.]

Subdivision 1. [GENERAL.] The commissioner may issue an administrative penalty order for a violation of statute, rule, or other authority if an administrative agent has failed to comply with a corrective order issued under section 299A.801 related to that violation. The maximum amount of an administrative penalty order is $10,000 for each administrative agent for all violations identified in an inspection or review of compliance. In addition to service by certified mail on the administrative agent, a copy of the administrative penalty order must be given to the county auditor in the county where the administrative agent is located.

Subd. 2. [AMOUNT OF PENALTY; CONSIDERATIONS.] (a) In determining the amount of a penalty to be assessed under this section, the commissioner may consider:

(1) the willfulness of the violation;

<HR><a name=167></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 167</center><HR> (2) the gravity of the violation, including damage to consumers or the state;

(3) the history of past violations;

(4) the number of violations;

(5) the economic benefit gained by the administrative agent by allowing or committing the violation; and

(6) other factors as justice may require, if the commissioner specifically identifies the additional factors in the commissioner's order.

(b) If an administrative agent violates a corrective order after a violation of a previous corrective order, the commissioner, in determining the amount of a penalty, must consider the factors in paragraph (a) and the following factors:

(1) similarity of the most recent previous violation of a corrective order and the violation to be penalized;

(2) time elapsed since the last violation of a corrective order;

(3) number of previous violations; and

(4) response of the administrative agent to the most recent previous violation identified.

Subd. 3. [CONTENTS OF ORDER.] An administrative penalty order under this section must include:

(1) a concise statement of the facts alleged to constitute a violation;

(2) a reference to the portion of the statute, rule, variance, order, or stipulation agreement or the term or condition of a permit that has been violated;

(3) a description of the violation of the corrective order that forms the basis for issuance of the administrative penalty order;

(4) a statement of the amount of the administrative penalty to be imposed and the factors upon which the penalty is based; and

(5) a statement of the administrative agent's right to review and appeal of the administrative penalty order.

Subd. 4. [DUE DATE.] (a) Unless the administrative agent requests review of the administrative penalty order under subdivision 5 before the penalty is due, the penalty in the order is due and payable on the 31st day after the administrative penalty order was received, if the administrative agent subject to the order fails to provide information to the commissioner showing that the violation has been corrected or that appropriate steps have been taken toward correcting the violation. These requirements may be waived or extended by the commissioner.

(b) Interest at the rate established in section 549.09 begins to accrue on penalties under this subdivision on the 31st day after the order with the penalty was received, unless waived by the commissioner.

Subd. 5. [EXPEDITED ADMINISTRATIVE HEARING.] (a) Within 30 days after receiving an administrative penalty order, the administrative agent subject to an order under this section may request an expedited hearing, using the procedures of Minnesota Rules, parts 1400.8510 to 1400.8612, or their successor rules, to review the commissioner's action. The hearing request must specifically state the reasons for seeking review of the <HR><a name=168></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 168</center><HR>administrative penalty order. The administrative agent to whom the administrative penalty order is directed and the commissioner are the parties to the expedited hearing. At least 15 days before the hearing, the commissioner shall notify the administrative agent to whom the administrative penalty order is directed of the time and place of the hearing. The expedited hearing must be held within 30 days after a request for hearing has been filed with the commissioner unless the parties agree to a later date.

(b) All written arguments must be submitted within ten days following the close of the hearing. The hearing must be conducted under Minnesota Rules, parts 1400.8510 to 1400.8612, or their successor rules, as modified by this subdivision. The office of administrative hearings, in consultation with the agency, may adopt rules specifically applicable to cases under this section.

(c) Within 30 days following the close of the record, the administrative law judge shall issue a report making recommendations about the commissioner's action to the commissioner. The administrative law judge may not recommend a change in the amount of the proposed administrative penalty unless the administrative law judge determines that, based on the factors in subdivision 1, the amount of the administrative penalty is unreasonable.

(d) If the administrative law judge makes a finding that the hearing was requested solely for purposes of delay or that the hearing request was frivolous, the commissioner may add to the amount of the administrative penalty the costs charged to the agency by the office of administrative hearings for the hearing.

(e) If a hearing has been held, the commissioner may not issue a final order until at least five days after receipt of the report of the administrative law judge. Within those five days, the administrative agent to whom an administrative penalty order is issued may comment to the commissioner on the recommendations and the commissioner shall consider the comments. The final administrative penalty order may be appealed to the district court for a de novo review of the order.

(f) If a hearing has been held and a final administrative penalty order issued by the commissioner, the administrative penalty must be paid by 30 days after the date the final order is received unless it is appealed to the district court. If an appeal is not taken or the administrative penalty order is upheld on appeal, the amount due is the administrative penalty, together with interest accruing from 31 days after the original order was received, at the rate established in section 549.09.

Subd. 6. [MEDIATION.] In addition to review under subdivision 5, the commissioner may enter into mediation concerning an order issued under this section if the commissioner and the administrative agent to whom the order is issued both agree to mediation.

Sec. 54. Minnesota Statutes 2002, section 299E.01, is amended by adding a subdivision to read:

Subd. 6. [VEHICLE TOWING.] Towing policy and practice for vehicles in public parking spaces within the capitol complex must conform to provisions of section 169.041.

Sec. 55. Minnesota Statutes 2002, section 299E.03, subdivision 3, is amended to read:

Subd. 3. [EXPIRATION AND COMPENSATION.] ~~Notwithstanding section 15.059,~~ The oversight committee ~~does not expire~~ expires June 30, 2004. Committee members may not receive compensation for serving, but may receive expense reimbursements as provided in section 15.059.

Sec. 56. [331A.12] [WEB SITE PUBLICATION OF LOCAL TRANSPORTATION RFP.]

Subdivision 1. [DEFINITIONS.] (a) The terms defined in this subdivision and section 331A.01 apply to this section.

<HR><a name=169></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 169</center><HR> (b) "Web site" means a specific, addressable location provided on a server connected to the Internet and hosting World Wide Web pages and other files that are generally accessible on the Internet all or most of the day.

Subd. 2. [DESIGNATION.] At the meeting of the governing body of the local public corporation at which the governing body must designate its official newspaper for the year, the governing body may designate in the same manner publication of transportation projects on the local public corporation's Web site. Publication on the Web site may be used in place of or in addition to any other required form of publication. Each year after designating publication on the Web site for transportation projects, the local public corporation must publish in a qualified newspaper in the jurisdiction and on the Web site, notice that the local public corporation will publish any advertisements for bids on its Web site.

Subd. 3. [FORM, TIME FOR PUBLICATION SAME.] A local public corporation that publishes on its Web site under this section must post the information in substantially the same format and for the same period of time as required for publication in an official newspaper or another other print publication.

Subd. 4. [RECORD RETENTION.] A local public corporation that publishes notice on its Web site under this section must ensure that a permanent record of publication is maintained in a form accessible by the public.

Sec. 57. Minnesota Statutes 2002, section 340A.403, is amended by adding a subdivision to read:

Subd. 4. [NOTICE TO COMMISSIONER.] Within ten days of the issuance of a license under this section, a municipality shall inform the commissioner, on a form the commissioner prescribes, of the licensee's name and address and trade name, the effective date and expiration date of the license, and any other information on the license the commissioner requires.

[EFFECTIVE DATE.] This section is effective July 1, 2003.

Sec. 58. Minnesota Statutes 2002, section 340A.414, is amended by adding a subdivision to read:

Subd. 1a. [ADDITIONAL AUTHORIZATION.] A holder of a consumption and display permit under this section who wishes to allow the consumption and display of intoxicating liquor between the hours of 1:00 a.m. and 2:00 a.m. must obtain authorization to do so from the commissioner. The authorization may be provided in a document issued to the permit holder by the commissioner, or by a notation on the permit holder's permit. Authorizations are valid for one year from the date of issuance. The annual fee for obtaining authorization is $200. The commissioner shall deposit all fees received under this subdivision in the alcohol enforcement account in the special revenue fund. A person who holds a consumption and display permit and who also holds a license to sell alcoholic beverages at on-sale at the same location is not required to obtain an authorization under this subdivision.

[EFFECTIVE DATE.] This section is effective July 1, 2003.

Sec. 59. Minnesota Statutes 2002, section 340A.504, is amended by adding a subdivision to read:

Subd. 7. [SALES AFTER 1:00 A.M.; PERMIT FEE.] (a) No licensee may sell intoxicating liquor or 3.2 percent malt liquor on-sale between the hours of 1:00 a.m. and 2:00 a.m. unless the licensee has obtained a permit from the commissioner. Application for the permit must be on a form the commissioner prescribes. Permits are effective for one year from date of issuance. For retailers of intoxicating liquor, the fee for the permit is based on the licensee's gross receipts from on-sales of alcoholic beverages in the 12 months prior to the month in which the permit is issued, and is at the following rates:

(1) up to $100,000 in gross receipts, $200;

<HR><a name=170></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 170</center><HR> (2) over $100,000 but not over $500,000 in gross receipts, $500; and

(3) over $500,000 in gross receipts, $600.

For a licensed retailer of intoxicating liquor who did not sell intoxicating liquor at on-sale for a full 12 months prior to the month in which the permit is issued, the fee is $200. For a retailer of 3.2 percent malt liquor, the fee is $200.

(b) The commissioner shall deposit all permit fees received under this subdivision in the alcohol enforcement account in the special revenue fund.

(c) Notwithstanding any law to the contrary, the commissioner of revenue may furnish to the commissioner the information necessary to administer and enforce this subdivision.

[EFFECTIVE DATE.] This section is effective July 1, 2003.

Sec. 60. [414.038] [EFFECT OF ANNEXATION OF TOWNSHIP ROADS.]

Whenever a municipality annexes property abutting one side of a township road, the segment of road abutting the annexed property must be treated as a line road and is subject to section 164.14. Whenever a municipality annexes the property on both sides of a township road, that portion of road abutting the annexed property ceases to be a town road and becomes the obligation of the annexing municipality. This section does not prohibit the annexing municipality from contracting with the township for continued maintenance of the road. Any portion of a township road that ceases to be a township road pursuant to this section may still be counted as a township road for the road-and-bridge account revenues for the year in which the annexation occurs.

Sec. 61. [414.039] [EFFECT OF ANNEXATION ON EASEMENTS.]

If a municipality annexes property in which the affected township holds any easement for the benefit of the public, the township's easement interest continues unless otherwise agreed to by the township.

Sec. 62. Laws 1999, chapter 238, article 1, section 2, subdivision 2, is amended to read:

Subd. 2. Aeronautics 19,327,000 19,410,000

Summary by Fund

Airports 19,266,000 19,349,000

General 50,000 50,000

Trunk Highway 11,000 11,000

Except as otherwise provided, the appropriations in this subdivision are from the state airports fund.

<HR><a name=171></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 171</center><HR>The amounts that may be spent from this appropriation for each activity are as follows:

(a) Airport Development and Assistance

2000 2001

13,948,000 13,948,000

$12,846,000 the first year and $12,846,000 the second year are for navigational aids, construction grants, and maintenance grants. If the appropriation for either year is insufficient, the appropriation for the other year is available for it.

These appropriations must be spent in accordance with Minnesota Statutes, section 360.305, subdivision 4.

Notwithstanding Minnesota Statutes, section 16A.28, subdivision 6, funds are available for five years after appropriation.

(b) Aviation Support

5,247,000 5,329,000

$65,000 the first year and $65,000 the second year are for the civil air patrol.

132,000 133,000

Summary by Fund

Airports 71,000 72,000

General 50,000 50,000

Trunk Highway 11,000 11,000

Sec. 63. Laws 2000, chapter 433, section 4, is amended to read:

Sec. 4. [EFFECTIVE DATE.]

Sections 1 to 3 are effective the day following final enactment ~~and are repealed June 1, 2003~~.

Sec. 64. Laws 2001, chapter 97, section 5, is amended to read:

Sec. 5. [EFFECTIVE DATE~~; EXPIRATION~~.]

~~(a)~~ Sections 1 to 4 are effective July 1, 2001.

<HR><a name=172></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 172</center><HR> ~~(b) The amendments in sections 3 and 4 to Minnesota Statutes, section 171.02, expire July 1, 2003.~~

~~(c) The amendment in section 1 to Minnesota Statutes, section 169.01, subdivision 75, expires July 1, 2003.~~

[EFFECTIVE DATE.] This section is effective July 1, 2003.

Sec. 65. Laws 2001, First Special Session chapter 8, article 1, section 2, subdivision 2, is amended to read:

Subd. 2. Aeronautics 20,748,000 20,489,000

Summary by Fund

Airports 20,687,000 20,428,000

General 50,000 50,000

Trunk Highway 11,000 11,000

Except as otherwise provided, the appropriations in this subdivision are from the state airports fund.

The amounts that may be spent from this appropriation for each activity are as follows:

(a) Airport Development and Assistance

14,298,000 14,298,000

These appropriations must be spent according to Minnesota Statutes, section 360.305, subdivision 4.

If the appropriation for either year is insufficient, the appropriation for the other year is available for it.

Notwithstanding Minnesota Statutes, section 16A.28, subdivision 6, funds are available for five years after appropriation.

(b) Aviation Support

6,315,000 6,053,000

$65,000 the first year and $65,000 the second year are for the civil air patrol.

$600,000 each year is for GPS navigation systems. Of this amount, $250,000 each year adds to the agency's budget base.

$400,000 the first year and $50,000 the second year are for the development of on-line aircraft registration capabilities.

<HR><a name=173></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 173</center><HR>(c) Air Transportation Services

135,000 138,000

Summary by Fund

Airports 74,000 77,000

General 50,000 50,000

Trunk Highway 11,000 11,000

The commissioner shall take all feasible actions to seek a waiver from the appropriate federal authorities that would allow the commissioner to sell the airplane described in Laws 1997, chapter 159, article 1, section 2, subdivision 2, clause (c). Any proceeds from the sale of the airplane must be deposited in the general fund.

Sec. 66. [TRANSFER FROM LOAN FUND.]

The commissioner of finance shall transfer to the general fund $8,200,000 of the money appropriated to the transportation revolving loan fund under Laws 2000, chapter 479, article 1, section 6, subdivision 2. This transfer must be made at the rate of $4,100,000 each year of the 2004-2005 biennium.

[EFFECTIVE DATE.] This section is effective July 1, 2003.

Sec. 67. [REST AREA PROGRAM; REPORT.]

The commissioner of transportation shall report to the chairs of the legislative committees with jurisdiction over transportation policy and finance by January 30, 2004, on the status of the department's highway rest area program. The report must include:

(1) adequacy of funding for the program;

(2) all rest area closings and hours of service reductions implemented and planned for the 2004-05 biennium;

(3) steps that the commissioner has taken or plans to make to allow leasing of rest areas to private entities or operation of rest areas by private entities, including provisions that the commissioner has made or intends to make to promote the employment of needy elderly persons at rest areas and preserve contracts under Minnesota Statutes, section 248.07.

Sec. 68. [STUDY; USE OF CENTERLINE RUMBLE STRIPS.]

The commissioner of transportation shall study the feasibility and practicability of:

(1) including milled-in rumble strips on the centerline of the highway in all projects for the construction, reconstruction, or resurfacing of two-lane trunk highways; and

(2) requiring that all projects for the construction, reconstruction, or resurfacing of two-lane county state-aid highways include milled-in rumble strips on the centerline of the highway.

<HR><a name=174></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 174</center><HR> Sec. 69. [TRANSFERS.]

The commissioner of finance shall transfer $155,000 from the remaining balance in the alcohol-impaired driver education account in the special revenue fund to the general fund.

[EFFECTIVE DATE.] This section is effective July 1, 2003.

Sec. 70. [HUBBARD MARKETPLACE TRANSIT HUB.]

Until June 30, 2005, the metropolitan council is prohibited from reducing the level of public access to services and facilities at Hubbard Marketplace transit station, in the city of Robbinsdale, as long as Hubbard Marketplace continues to be operated as a transit station.

Sec. 71. [BUS RAPID TRANSIT STUDY.]

Subdivision 1. [STUDY REQUIRED.] The department of transportation shall conduct a study on the feasibility of implementing a bus rapid transit (BRT) system in the I-35W corridor from downtown Minneapolis through south Minneapolis and the cities of Richfield, Bloomington, Burnsville, and Lakeville. Bus rapid transit systems are those systems that provide for significantly faster operating bus speeds, integrated service, greater service reliability, and increased convenience through investments in bus infrastructure, equipment, technology, and operational improvements.

Subd. 2. [STUDY REQUIREMENTS.] The study must, at a minimum, include an analysis of the benefits and costs of implementing a bus rapid transit system that includes the following:

(1) frequent operation of buses on exclusive or near-exclusive right-of-way on marked interstate highway 35W;

(2) changes in bus or platform design and fare collection that provide for faster convenient boarding;

(3) station locations that are adjacent to, or easily accessible from, the exclusive right-of-way;

(4) traffic management improvements and traffic signal preemption on local streets within the I-35W corridor; and

(5) changes to existing transit services to provide for timely connections and transfers.

Subd. 3. [STUDY RECOMMENDATIONS.] The study must recommend:

(1) options for implementing bus rapid transit in the I-35W corridor;

(2) the associated cost of each option; and

(3) the anticipated benefits in terms of reduced travel times, increased ridership, increased mobility, and impacts on congestion levels within the corridor.

The study must be submitted by December 10, 2004, to the house of representatives and senate committees with jurisdiction over transportation policy and finance.

[EFFECTIVE DATE.] This section is effective July 1, 2003.

<HR><a name=175></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 175</center><HR> Sec. 72. [REQUEST FOR PROPOSALS.]

Notwithstanding Minnesota Statutes, section 473.4051, the metropolitan council must prepare a request for proposals to operate in whole or in part the Hiawatha light rail transit line. The request must invite proposals from vendors from within and outside of Minnesota. The metropolitan council must consult with the commissioner of administration in preparing the request. The council must obtain an internal competitive proposal from its own metropolitan transit operations division. The department of administration, in consultation with the department of finance and the Hennepin county regional rail authority, must evaluate the proposals received in a report to the council. The council must take into consideration the evaluations of the commissioner in determining whether it is more advantageous to contract with a vendor for the operating services, and if so, which vendor to select. If the council determines it is more advantageous to contract with a vendor for the operating services it must select a vendor not later than December 1, 2003. Minnesota Statutes, section 473.392, does not apply to the procurement by the council of operating services for the Hiawatha light rail transit line.

Sec. 73. [ITASCA COUNTY; LAND EXCHANGE.]

Notwithstanding Minnesota Statutes, section 373.01, subdivision 1, Itasca county may exchange a parcel or parcels of real property of substantially similar or equal value without advertising for bids to acquire real property for maintenance facilities directly related to county highways. The estimated value of the parcels exchanged must be determined by the Itasca county assessor, and the exchange must otherwise comply with Minnesota Statutes, section 373.01, and other applicable law.

[EFFECTIVE DATE.] This section is effective immediately without local approval, because it enables a local government unit to exercise authority not granted by general law as provided in Minnesota Statutes, section 645.023, subdivision 1, paragraph (a).

Sec. 74. [SOUTHWEST CORRIDOR RAIL TRANSIT; PROHIBITIONS.]

Subdivision 1. [DEFINITION.] For purposes of this section, "southwest transit way corridor" means the southwest transit way corridor between Minneapolis and Eden Prairie as identified by the Hennepin county regional rail authority in its southwest corridor rail transit study.

Subd. 2. [PROHIBITIONS.] Until July 1, 2005, neither the commissioner of transportation, the metropolitan council, nor the Hennepin county regional rail authority may take any action or spend any money for preliminary engineering, final design, or construction for light rail or commuter rail transit in the southwest transit way corridor.

Sec. 75. [NORTHSTAR COMMUTER RAIL STUDY.]

The commissioner of transportation, in conjunction with the Northstar Corridor Development Authority, shall convene a work group to further study the feasibility of constructing the Northstar commuter rail. The work group shall update ridership forecasts for the commuter rail based on 2000 census data and seek updated information from the Burlington Northern Santa Fe railroad regarding capacity improvements, railroad usage rights, construction, risk and liability allocation, and other related issues. By January 15, 2004, the commissioner shall report the work group's findings to the chairs and ranking members of the legislative committees having jurisdiction over transportation and capital investment. The commissioner of transportation shall not pay for any outside consultant expenses related to this work.

Sec. 76. [COMMISSIONER OF REVENUE; STUDY.]

(a) The commissioner of revenue, in consultation with the hospitality industry, shall conduct a study to determine the amount of annual increase in state tax revenue that is attributable to changes in the hours of permissible sale of alcoholic beverages. The commissioner shall report the results of the study to the governor and legislature by January 15, 2005.

<HR><a name=176></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 176</center><HR> (b) If the study determines that the amount of the annual increase is at least $3,850,000 during the period studied, the commissioner shall so report to the secretary of state.

Sec. 77. [PARTICIPATION IN METROPOLITAN AIRPORTS COMMISSION TAXICAB ADVISORY COMMITTEE.]

To the extent the metropolitan airports commission maintains a taxicab advisory committee, the commission must allow for full public comment and participation of any individual, association, or other entity within the taxicab industry. The commission may not prohibit participation of any representative of a taxicab owner, taxicab company, or association that qualifies to be a member of the taxicab advisory committee. This section expires June 30, 2005.

Sec. 78. 2003 House File No. 719, section 30, if enacted, is amended to read:

Sec. 30. [EFFECTIVE DATE.]

Sections 1 to 9 and 13 to 29 are effective the day following final enactment. Sections 10 to 12 are effective July 1, 2003.

Sec. 79. [REPEALER.]

Subdivision 1. [STATUTES.] Minnesota Statutes 2002, sections 162.09, subdivision 5; 169.794; 169.799; 174.025; 174.031; 174.242; 221.165; 221.54; and 221.55, are repealed.

Subd. 2. [RULES.] Minnesota Rules, parts 7403.1300; 7413.0400; 7413.0500; 7800.0100, subparts 1, 3, and 5; 7800.0500; 7800.0700; 7800.1400; 7800.1500; 7800.1600; 7800.1700; 7800.3100; 7800.3900; 7800.4810; 7805.0800; 8800.0100, subparts 7 and 36; 8800.1200, subpart 3; 8800.3500; 8800.3700; 8800.4000; 8810.4200; 8810.4500; 8810.4600; 8810.4700; 8810.4800; 8810.4900; 8810.5000; 8810.5100; 8810.5500; 8810.9920; 8810.9921; 8850.6900, subparts 4, 6, 11, 12, and 17; 8850.7000; 8850.7025; 8850.7040; 8850.7100; 8850.7900; 8850.8200; 8850.8900; 8850.9000; 8850.9050, subparts 1 and 2; 8900.0100; 8900.0200; 8900.0300; 8900.0400; 8900.0500; 8900.0600; 8900.0700; 8900.0800; 8900.0900; 8900.1000; 8900.1100; 8910.1000; 8910.2000; 8910.2100; 8910.3000; and 8910.3100, are repealed.

Subd. 3. [OTHER PROVISIONS.] Sections 50, 57, 58, and 59 are repealed on July 1, 2005, provided that the commissioner of finance has made the report to the secretary of state of the determination described in section 76, paragraph (b), by that date. If no such determination has been made by that date, sections 50, 57, 58, and 59 remain in effect.

Sec. 80. [EFFECTIVE DATE.]

This article is effective the day following final enactment, unless otherwise specified.

ARTICLE 3

TRUNK HIGHWAY BONDING

Section 1. [HIGHWAY AND TRANSIT APPROPRIATIONS.]

Subdivision 1. [TRUNK HIGHWAY PROJECTS FINANCED BY STATE BONDS.] (a) $400,000,000 is appropriated from the bond proceeds account in the trunk highway fund to the commissioner of transportation for trunk highway improvements. This appropriation is for:

<HR><a name=177></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 177</center><HR> (1) trunk highway improvements within the seven-county metropolitan area primarily for improving traffic flow and expanding highway capacity by eliminating traffic bottlenecks and improving segments of at-risk interregional corridors within the seven-county area; and

(2) trunk highway improvements on at-risk interregional corridors located outside the seven-county metropolitan area.

These appropriations include the cost of actual payment to landowners for lands acquired for highway right-of-way, payment to lessees, interest subsidies, and relocation expenses. Within each category in clauses (1) and (2), the commissioner shall spend not less than $25,000,000 on highway safety and capacity improvement projects including but not limited to the addition of lanes on trunk highway corridors with known safety problems.

(b) In spending the appropriation under paragraph (a), the commissioner shall, to the maximum feasible extent, seek to allocate spending equally between the department of transportation metropolitan district and the remainder of the state.

(d) The commissioner shall use at least $36,000,000 of this appropriation for accelerating transit capital improvements on trunk highways such as shoulder bus lanes, bus park-and-ride facilities, and ramp meter-bypass facilities.

Subd. 2. [REPORT.] The commissioner shall report to the committees having jurisdiction over transportation finance in the house of representatives and senate, no later than January 15 of each year through 2007, on projects selected to be funded by this appropriation. The report must include the geographic distribution of the selected projects and their adherence to the criteria and spending allocation goals listed in subdivision 1, and the location and cost of each project.

Subd. 3. [BOND SALE EXPENSES.] $400,000 is appropriated from the bond proceeds account in the trunk highway fund to the commissioner of finance for bond sale expenses under Minnesota Statutes, section 16A.641, subdivision 8.

Subd. 4. [CANCELLATION.] Any part of the appropriation in this section that is not encumbered or otherwise obligated by June 30, 2007, must be canceled to the trunk highway bond account in the state bond fund.

Sec. 2. [BOND SALE.]

To provide the money appropriated in section 1, subdivisions 1 and 4, from the bond proceeds account in the trunk highway fund, the commissioner of finance shall sell and issue bonds of the state in an amount up to $400,550,000 in the manner, on the terms, and with the effect prescribed by Minnesota Statutes, sections 167.50 to 167.52, and by the Minnesota Constitution, article XIV, section 11, at the times and in the amounts requested by the commissioner of transportation. The proceeds of the bonds, except accrued interest and any premium received from the sale of the bonds, must be deposited in the bond proceeds account in the trunk highway fund.

Sec. 3. [ADVANCE CONSTRUCTION.]

(a) Through June 30, 2009, the commissioner of transportation may spend up to $400,400,000 on trunk highway improvements from funds approved for expenditure by the Federal Highway Administration and designated as advance construction funds.

<HR><a name=178></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 178</center><HR> (b) Any additional advance construction expenditures by the commissioner approved by the Federal Highway Administration through June 30, 2009, may be added to the amount in paragraph (a).

(c) In spending federal funds under paragraphs (a) and (b), the commissioner shall, to the maximum feasible extent, seek to allocate spending equally between the department of transportation metropolitan district and the remainder of the state.

(d) The commissioner shall report to the chairs of the senate and house of representatives committees with jurisdiction over transportation policy and finance by January 15 each year regarding the use of advance construction funding in the previous and current fiscal year. The report must include:

(1) an analysis of the impact of the use of advance construction funding on the trunk highway fund balance and cash flow;

(2) an estimate of the amount of additional advance construction funding that is available for use in future fiscal years and the impact on the department's total road construction program; and

(3) geographic distribution of spending and compliance with the spending goal in paragraph (c).

Sec. 4. [GREATER MINNESOTA TRANSIT.]

The commissioner of transportation may spend up to $5,000,000 through June 30, 2008, in federal transit funds for capital assistance to public transit systems under Minnesota Statutes, section 174.24. This amount is in addition to any appropriations made by law for this purpose.

Sec. 5. [REPORT.]

The commissioner shall report by January 15 of each year through 2007 to the chairs of the legislative committees with jurisdiction over transportation policy and finance on (1) how the department is spending the appropriations in this article for trunk highway improvements, and (2) the department's plans to implement trunk highway improvements funded under this article with current department staffing, and an analysis of the need for additional staffing and consultant services.

Sec. 6. [EFFECTIVE DATE.]

Sections 1 to 4 are effective the day following final enactment.

ARTICLE 4

FISCAL YEAR 2003 APPROPRIATIONS AND TRANSFERS

Section 1. [TRANSPORTATION APPROPRIATIONS AND TRANSFERS.]

The dollar amounts in the columns under "APPROPRIATION CHANGE" are added to or, if shown in parentheses, are subtracted from the appropriations in Laws 2001, First Special Session chapter 8, as amended, or other law to the specified agencies. The appropriations are from the general fund or other named fund and are available for the fiscal years indicated for each purpose. The figure "2003" means that the addition to or subtraction from the appropriations listed under the figure is for the fiscal year ending June 30, 2003.

<HR><a name=179></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 179</center><HR> 2003

TRANSFERS FROM OTHER FUNDS $15,000,000

CANCELLATIONS - GENERAL FUND (110,000,000)

TRUNK HIGHWAY BOND PROCEEDS ACCOUNT - TRUNK HIGHWAY FUND 110,110,000

APPROPRIATION CHANGE

Sec. 2. TRANSPORTATION 110,000,000

This appropriation is from the trunk highway bond proceeds account in the trunk highway fund and is available for expenditure beginning the day following final enactment. It is for the same purposes as specified in Laws 2000, chapter 479, article 1, section 2, subdivision 3.

Of the general fund appropriation in Laws 2000, chapter 479, article 1, section 2, subdivision 3, $110,000,000 cancels to the general fund. This cancellation is effective the day following final enactment.

By June 30, 2003, the commissioner of finance shall transfer $15,000,000 of the cash balance in the state airports fund established in Minnesota Statutes, section 360.017, to the general fund.

Sec. 3. BOND SALE EXPENSES 110,000

To the commissioner of finance for bond sale expenses under Minnesota Statutes, section 16A.641, subdivision 8. This appropriation is from the trunk highway bond proceeds account in the trunk highway fund.

Sec. 4. BOND SALE AUTHORIZATION

To provide the money appropriated in this act from the trunk highway bond proceeds account in the trunk highway fund, the commissioner of finance shall sell and issue bonds of the state in an amount up to $110,110,000 in the manner, upon the terms, and with the effect prescribed by Minnesota Statutes, sections 167.50 to 167.52, and by the Minnesota Constitution, article XIV, section 11, at the times and in the amount requested by the commissioner of transportation. The proceeds of the bonds, except accrued interest and any premium received on the sale of the bonds, must be credited to the trunk highway bond proceeds account in the trunk highway fund.

Sec. 5. [EFFECTIVE DATE.]

Sections 1 to 4 are effective the day following final enactment."

<HR><a name=180></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 180</center><HR> Delete the title and insert:

"A bill for an act relating to appropriations; appropriating money for transportation, public safety, and other purposes; authorizing issuance of state bonds; modifying provisions relating to contract awards, land appraisal, archaeological or historic sites, high-occupancy vehicle lanes, highways and highway rest areas, town roads and easements, county highways and cartways, streets, other transportation corridors, major transportation projects commission, responsibilities of the department of transportation, transit, forecasts of highway-related revenues and expenditures, motor carriers, a land exchange, and other transportation-related activities; providing for fees, surcharges, funds and accounts, transfers, allocations, and expenditures; modifying provisions regulating special mobile equipment, special vehicle license plates, speed limits and other traffic regulations, vehicle weight limits and other vehicle regulations, vehicle insurance requirements, small school buses, drivers' licenses, capitol complex towing policy, public safety officer benefit funds, liquor, and other activities related to public safety; authorizing administrative powers, penalties, and remedies for public safety purposes; providing for petroleum inspection cost recovery; repealing certain rules governing design standards of driveways next to highways, motor carriers, aeronautics, and the right of first refusal to certain railroad land; requiring studies and reports; making technical and clarifying changes; amending Minnesota Statutes 2002, sections 13.44, subdivision 3; 16A.88, subdivision 1; 117.232, subdivision 1; 138.40, subdivisions 2, 3; 161.08; 161.20, subdivision 3; 162.02, subdivisions 1, 2, 4; 162.09, subdivision 1; 163.07, subdivision 2; 163.11, by adding subdivisions; 164.12; 168.011, subdivision 22; 168.013, subdivision 3; 168.12, subdivisions 2e, 5; 168.54, subdivision 4; 168A.29, subdivision 1; 169.14, subdivision 5a; 169.448, subdivision 1; 169.791, subdivision 1; 169.796, by adding a subdivision; 169.797, subdivision 4a; 169.798, subdivision 1, by adding a subdivision; 169.826, subdivision 1, by adding a subdivision; 169.85, subdivision 2; 169.86, subdivision 5; 171.02, subdivision 2a; 171.20, subdivision 4; 171.29, subdivision 2; 174.03, by adding a subdivision; 174.24, subdivisions 1, 3b, 5; 174.55, subdivision 2; 174.64, subdivision 4; 239.101, by adding a subdivision; 275.71, subdivision 5; 297B.09, subdivision 1; 299A.465, subdivision 4; 299E.01, by adding a subdivision; 299E.03, subdivision 3; 340A.403, by adding a subdivision; 340A.414, by adding a subdivision; 340A.504, by adding a subdivision; Laws 1999, chapter 238, article 1, section 2, subdivision 2; Laws 2000, chapter 433, section 4; Laws 2001, chapter 97, section 5; Laws 2001, First Special Session chapter 8, article 1, section 2, subdivision 2; 2003 H. F. No. 719, section 30, if enacted; proposing coding for new law in Minnesota Statutes, chapters 117; 160; 161; 168; 299A; 331A; 414; repealing Minnesota Statutes 2002, sections 162.09, subdivision 5; 169.794; 169.799; 174.025; 174.031; 174.242; 221.165; 221.54; 221.55; Minnesota Rules, parts 7403.1300; 7413.0400; 7413.0500; 7800.0100, subparts 1, 3, 5; 7800.0500; 7800.0700; 7800.1400; 7800.1500; 7800.1600; 7800.1700; 7800.3100; 7800.3900; 7800.4810; 7805.0800; 8800.0100, subparts 7, 36; 8800.1200, subpart 3; 8800.3500; 8800.3700; 8800.4000; 8810.4200; 8810.4500; 8810.4600; 8810.4700; 8810.4800; 8810.4900; 8810.5000; 8810.5100; 8810.5500; 8810.9920; 8810.9921; 8850.6900, subparts 4, 6, 11, 12, 17; 8850.7000; 8850.7025; 8850.7040; 8850.7100; 8850.7900; 8850.8200; 8850.8900; 8850.9000; 8850.9050, subparts 1, 2; 8900.0100; 8900.0200; 8900.0300; 8900.0400; 8900.0500; 8900.0600; 8900.0700; 8900.0800; 8900.0900; 8900.1000; 8900.1100; 8910.1000; 8910.2000; 8910.2100; 8910.3000; 8910.3100."

The motion prevailed and the amendment was adopted.

Kuisle moved to amend H. F. No. 5, as amended, as follows:

Page 2, line 26, delete "41,688,000" and insert "41,548,000" and delete "41,689,000" and insert "41,549,000"

Page 2, line 29, delete "16,295,000" and insert "16,155,000" and delete "16,296,000" and insert "16,156,000"

Page 3, line 31, delete "16,097,000" and insert "15,957,000" and delete "16,098,000" and insert "15,958,000"

Page 3, line 33, delete "15,949,000" and insert "15,809,000" and delete "15,950,000" and insert "15,810,000"

<HR><a name=181></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 181</center><HR> Page 77, line 27, delete "finance" and insert "revenue"

Page 79, line 15, delete "$400,550,000" and insert "$400,400,000"

Page 79, line 26, delete "$400,400,000" and insert "$400,000,000"

The motion prevailed and the amendment was adopted.

H. F. No. 5, A bill for an act relating to appropriations; appropriating money for transportation, public safety, and other purposes; authorizing issuance of state bonds; modifying provisions relating to contract awards, land appraisal, archaeological or historic sites, high-occupancy vehicle lanes, highways and highway rest areas, town roads and easements, county highways and cartways, streets, other transportation corridors, major transportation projects commission, responsibilities of the department of transportation, transit, forecasts of highway-related revenues and expenditures, motor carriers, a land exchange, and other transportation-related activities; providing for fees, surcharges, funds and accounts, transfers, allocations, and expenditures; modifying provisions regulating special mobile equipment, special vehicle license plates, speed limits and other traffic regulations, vehicle weight limits and other vehicle regulations, vehicle insurance requirements, small school buses, drivers' licenses, capitol complex towing policy, public safety officer benefit funds, liquor, and other activities related to public safety; authorizing administrative powers, penalties, and remedies for public safety purposes; providing for petroleum inspection cost recovery; repealing certain rules governing design standards of driveways next to highways, motor carriers, aeronautics, and the right of first refusal to certain railroad land; requiring studies and reports; making technical and clarifying changes; amending Minnesota Statutes 2002, sections 13.44, subdivision 3; 16A.88, subdivision 1; 117.232, subdivision 1; 138.40, subdivisions 2, 3; 161.08; 161.20, subdivision 3; 162.02, subdivisions 1, 2, 4; 162.09, subdivision 1; 163.07, subdivision 2; 163.11, by adding subdivisions; 164.12; 168.011, subdivision 22; 168.013, subdivision 3; 168.12, subdivisions 2e, 5; 168.54, subdivision 4; 168A.29, subdivision 1; 169.14, subdivision 5a; 169.448, subdivision 1; 169.791, subdivision 1; 169.796, by adding a subdivision; 169.797, subdivision 4a; 169.798, subdivision 1, by adding a subdivision; 169.826, subdivision 1, by adding a subdivision; 169.85, subdivision 2; 169.86, subdivision 5; 171.02, subdivision 2a; 171.20, subdivision 4; 171.29, subdivision 2; 174.03, by adding a subdivision; 174.24, subdivisions 1, 3b, 5; 174.55, subdivision 2; 174.64, subdivision 4; 239.101, by adding a subdivision; 275.71, subdivision 5; 297B.09, subdivision 1; 299A.465, subdivision 4; 299E.01, by adding a subdivision; 299E.03, subdivision 3; 340A.403, by adding a subdivision; 340A.414, by adding a subdivision; 340A.504, by adding a subdivision; Laws 1999, chapter 238, article 1, section 2, subdivision 2; Laws 2000, chapter 433, section 4; Laws 2001, chapter 97, section 5; Laws 2001, First Special Session chapter 8, article 1, section 2, subdivision 2; 2003 H. F. No. 719, section 30, if enacted; proposing coding for new law in Minnesota Statutes, chapters 117; 160; 161; 168; 299A; 331A; 414; repealing Minnesota Statutes 2002, sections 162.09, subdivision 5; 169.794; 169.799; 174.025; 174.031; 174.242; 221.165; 221.54; 221.55; Minnesota Rules, parts 7403.1300; 7413.0400; 7413.0500; 7800.0100, subparts 1, 3, 5; 7800.0500; 7800.0700; 7800.1400; 7800.1500; 7800.1600; 7800.1700; 7800.3100; 7800.3900; 7800.4810; 7805.0800; 8800.0100, subparts 7, 36; 8800.1200, subpart 3; 8800.3500; 8800.3700; 8800.4000; 8810.4200; 8810.4500; 8810.4600; 8810.4700; 8810.4800; 8810.4900; 8810.5000; 8810.5100; 8810.5500; 8810.9920; 8810.9921; 8850.6900, subparts 4, 6, 11, 12, 17; 8850.7000; 8850.7025; 8850.7040; 8850.7100; 8850.7900; 8850.8200; 8850.8900; 8850.9000; 8850.9050, subparts 1, 2; 8900.0100; 8900.0200; 8900.0300; 8900.0400; 8900.0500; 8900.0600; 8900.0700; 8900.0800; 8900.0900; 8900.1000; 8900.1100; 8910.1000; 8910.2000; 8910.2100; 8910.3000; 8910.3100.

The bill was read for the third time, as amended, and placed upon its final passage.

<HR><a name=182></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 182</center><HR> The question was taken on the passage of the bill and the roll was called. There were 82 yeas and 50 nays as follows:

Those who voted in the affirmative were:

The bill was passed, as amended, and its title agreed to.

<HR><a name=184></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 184</center><HR> The Speaker resumed the Chair.

FISCAL CALENDAR, Continued

Pursuant to rule 1.22, Abrams requested immediate consideration of H. F. No. 7.

H. F. No. 7 was reported to the House.

Abrams moved to amend H. F. No. 7 as follows:

Delete everything after the enacting clause and insert:

"ARTICLE 1

JOB OPPORTUNITY BUILDING ZONES

Section 1. Minnesota Statutes 2002, section 272.02, is amended by adding a subdivision to read:

Subd. 56. [JOB OPPORTUNITY BUILDING ZONE PROPERTY.] (a) Improvements to real property, and personal property, classified under section 273.13, subdivision 24, and located within a job opportunity building zone, designated under section 469.314, are exempt from ad valorem taxes levied under chapter 275.

(b) Improvements to real property, and tangible personal property, of an agricultural production facility located within an agricultural processing facility zone, designated under section 469.314, is exempt from ad valorem taxes levied under chapter 275.

(c) For property to qualify for exemption under paragraph (a), the occupant must be a qualified business, as defined in section 469.310.

(d) The exemption applies beginning for the first assessment year after designation of the job opportunity building zone by the commissioner of trade and economic development. The exemption applies to each assessment year that begins during the duration of the job opportunity building zone and to property occupied by July 1 of the assessment year by a qualified business. This exemption does not apply to:

(1) the levy under section 475.61 or similar levy provisions under any other law to pay general obligation bonds; or

(2) a levy under section 126C.17, if the levy was approved by the voters before the designation of the job opportunity building zone.

[EFFECTIVE DATE.] This section is effective beginning for property taxes assessed in 2004, payable in 2005.

<HR><a name=185></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 185</center><HR> Sec. 2. Minnesota Statutes 2002, section 272.029, is amended by adding a subdivision to read:

Subd. 7. [EXEMPTION.] The tax imposed under this section does not apply to electricity produced by wind energy conversion systems located in a job opportunity building zone, designated under section 469.314, for the duration of the zone. The exemption applies beginning for the first calendar year after designation of the zone and applies to each calendar year that begins during the designation of the zone.

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

Sec. 3. Minnesota Statutes 2002, section 290.01, subdivision 19b, is amended to read:

Subd. 19b. [SUBTRACTIONS FROM FEDERAL TAXABLE INCOME.] For individuals, estates, and trusts, there shall be subtracted from federal taxable income:

(1) interest income on obligations of any authority, commission, or instrumentality of the United States to the extent includable in taxable income for federal income tax purposes but exempt from state income tax under the laws of the United States;

(2) if included in federal taxable income, the amount of any overpayment of income tax to Minnesota or to any other state, for any previous taxable year, whether the amount is received as a refund or as a credit to another taxable year's income tax liability;

(3) the amount paid to others, less the amount used to claim the credit allowed under section 290.0674, not to exceed $1,625 for each qualifying child in grades kindergarten to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and transportation of each qualifying child in attending an elementary or secondary school situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a resident of this state may legally fulfill the state's compulsory attendance laws, which is not operated for profit, and which adheres to the provisions of the Civil Rights Act of 1964 and chapter 363. For the purposes of this clause, "tuition" includes fees or tuition as defined in section 290.0674, subdivision 1, clause (1). As used in this clause, "textbooks" includes books and other instructional materials and equipment purchased or leased for use in elementary and secondary schools in teaching only those subjects legally and commonly taught in public elementary and secondary schools in this state. Equipment expenses qualifying for deduction includes expenses as defined and limited in section 290.0674, subdivision 1, clause (3). "Textbooks" does not include instructional books and materials used in the teaching of religious tenets, doctrines, or worship, the purpose of which is to instill such tenets, doctrines, or worship, nor does it include books or materials for, or transportation to, extracurricular activities including sporting events, musical or dramatic events, speech activities, driver's education, or similar programs. For purposes of the subtraction provided by this clause, "qualifying child" has the meaning given in section 32(c)(3) of the Internal Revenue Code;

(4) income as provided under section 290.0802;

(5) to the extent included in federal adjusted gross income, income realized on disposition of property exempt from tax under section 290.491;

(6) to the extent not deducted in determining federal taxable income or used to claim the long-term care insurance credit under section 290.0672, the amount paid for health insurance of self-employed individuals as determined under section 162(l) of the Internal Revenue Code, except that the percent limit does not apply. If the individual deducted insurance payments under section 213 of the Internal Revenue Code of 1986, the subtraction under this clause must be reduced by the lesser of:

<HR><a name=186></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 186</center><HR> (i) the total itemized deductions allowed under section 63(d) of the Internal Revenue Code, less state, local, and foreign income taxes deductible under section 164 of the Internal Revenue Code and the standard deduction under section 63(c) of the Internal Revenue Code; or

(ii) the lesser of (A) the amount of insurance qualifying as "medical care" under section 213(d) of the Internal Revenue Code to the extent not deducted under section 162(1) of the Internal Revenue Code or excluded from income or (B) the total amount deductible for medical care under section 213(a);

(7) the exemption amount allowed under Laws 1995, chapter 255, article 3, section 2, subdivision 3;

(8) to the extent included in federal taxable income, postservice benefits for youth community service under section 124D.42 for volunteer service under United States Code, title 42, sections 12601 to 12604;

(9) to the extent not deducted in determining federal taxable income by an individual who does not itemize deductions for federal income tax purposes for the taxable year, an amount equal to 50 percent of the excess of charitable contributions allowable as a deduction for the taxable year under section 170(a) of the Internal Revenue Code over $500;

(10) for taxable years beginning before January 1, 2008, the amount of the federal small ethanol producer credit allowed under section 40(a)(3) of the Internal Revenue Code which is included in gross income under section 87 of the Internal Revenue Code;

(11) for individuals who are allowed a federal foreign tax credit for taxes that do not qualify for a credit under section 290.06, subdivision 22, an amount equal to the carryover of subnational foreign taxes for the taxable year, but not to exceed the total subnational foreign taxes reported in claiming the foreign tax credit. For purposes of this clause, "federal foreign tax credit" means the credit allowed under section 27 of the Internal Revenue Code, and "carryover of subnational foreign taxes" equals the carryover allowed under section 904(c) of the Internal Revenue Code minus national level foreign taxes to the extent they exceed the federal foreign tax credit; ~~and~~

(12) in each of the five tax years immediately following the tax year in which an addition is required under subdivision 19a, clause (7), an amount equal to one-fifth of the delayed depreciation. For purposes of this clause, "delayed depreciation" means the amount of the addition made by the taxpayer under subdivision 19a, clause (7), minus the positive value of any net operating loss under section 172 of the Internal Revenue Code generated for the tax year of the addition. The resulting delayed depreciation cannot be less than zero; and

(13) job opportunity building zone income as provided under section 469.316.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

Sec. 4. Minnesota Statutes 2002, section 290.01, subdivision 29, is amended to read:

Subd. 29. [TAXABLE INCOME.] The term "taxable income" means:

(1) for individuals, estates, and trusts, the same as taxable net income;

(2) for corporations, the taxable net income less

(i) the net operating loss deduction under section 290.095; ~~and~~

<HR><a name=187></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 187</center><HR> (ii) the dividends received deduction under section 290.21, subdivision 4; and

(iii) the exemption for operating in a job opportunity building zone under section 469.317.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

Sec. 5. Minnesota Statutes 2002, section 290.06, subdivision 2c, is amended to read:

Subd. 2c. [SCHEDULES OF RATES FOR INDIVIDUALS, ESTATES, AND TRUSTS.] (a) The income taxes imposed by this chapter upon married individuals filing joint returns and surviving spouses as defined in section 2(a) of the Internal Revenue Code must be computed by applying to their taxable net income the following schedule of rates:

(1) On the first $25,680, 5.35 percent;

(2) On all over $25,680, but not over $102,030, 7.05 percent;

(3) On all over $102,030, 7.85 percent.

Married individuals filing separate returns, estates, and trusts must compute their income tax by applying the above rates to their taxable income, except that the income brackets will be one-half of the above amounts.

(b) The income taxes imposed by this chapter upon unmarried individuals must be computed by applying to taxable net income the following schedule of rates:

(1) On the first $17,570, 5.35 percent;

(2) On all over $17,570, but not over $57,710, 7.05 percent;

(3) On all over $57,710, 7.85 percent.

(c) The income taxes imposed by this chapter upon unmarried individuals qualifying as a head of household as defined in section 2(b) of the Internal Revenue Code must be computed by applying to taxable net income the following schedule of rates:

(1) On the first $21,630, 5.35 percent;

(2) On all over $21,630, but not over $86,910, 7.05 percent;

(3) On all over $86,910, 7.85 percent.

(d) In lieu of a tax computed according to the rates set forth in this subdivision, the tax of any individual taxpayer whose taxable net income for the taxable year is less than an amount determined by the commissioner must be computed in accordance with tables prepared and issued by the commissioner of revenue based on income brackets of not more than $100. The amount of tax for each bracket shall be computed at the rates set forth in this subdivision, provided that the commissioner may disregard a fractional part of a dollar unless it amounts to 50 cents or more, in which case it may be increased to $1.

(e) An individual who is not a Minnesota resident for the entire year must compute the individual's Minnesota income tax as provided in this subdivision. After the application of the nonrefundable credits provided in this chapter, the tax liability must then be multiplied by a fraction in which:

<HR><a name=188></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 188</center><HR> (1) the numerator is the individual's Minnesota source federal adjusted gross income as defined in section 62 of the Internal Revenue Code and increased by the additions required under section 290.01, subdivision 19a, clauses (1) and (6), and reduced by the subtraction under section 290.01, subdivision 19b, clause (13), and the Minnesota assignable portion of the subtraction for United States government interest under section 290.01, subdivision 19b, clause (1), after applying the allocation and assignability provisions of section 290.081, clause (a), or 290.17; and

(2) the denominator is the individual's federal adjusted gross income as defined in section 62 of the Internal Revenue Code of 1986, increased by the amounts specified in section 290.01, subdivision 19a, clauses (1) and (6), and reduced by the amounts specified in section 290.01, subdivision 19b, ~~clause~~ clauses (1) and (13).

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

Sec. 6. Minnesota Statutes 2002, section 290.06, is amended by adding a subdivision to read:

Subd. 29. [JOB OPPORTUNITY BUILDING ZONE JOB CREDIT.] A taxpayer that is a qualified business, as defined in section 469.310, subdivision 11, is allowed a credit as determined under section 469.318 against the tax imposed by this chapter.

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

Sec. 7. Minnesota Statutes 2002, section 290.067, subdivision 1, is amended to read:

Subdivision 1. [AMOUNT OF CREDIT.] (a) A taxpayer may take as a credit against the tax due from the taxpayer and a spouse, if any, under this chapter an amount equal to the dependent care credit for which the taxpayer is eligible pursuant to the provisions of section 21 of the Internal Revenue Code subject to the limitations provided in subdivision 2 except that in determining whether the child qualified as a dependent, income received as a Minnesota family investment program grant or allowance to or on behalf of the child must not be taken into account in determining whether the child received more than half of the child's support from the taxpayer, and the provisions of section 32(b)(1)(D) of the Internal Revenue Code do not apply.

(b) If a child who has not attained the age of six years at the close of the taxable year is cared for at a licensed family day care home operated by the child's parent, the taxpayer is deemed to have paid employment-related expenses. If the child is 16 months old or younger at the close of the taxable year, the amount of expenses deemed to have been paid equals the maximum limit for one qualified individual under section 21(c) and (d) of the Internal Revenue Code. If the child is older than 16 months of age but has not attained the age of six years at the close of the taxable year, the amount of expenses deemed to have been paid equals the amount the licensee would charge for the care of a child of the same age for the same number of hours of care.

(1) has a child who has not attained the age of one year at the close of the taxable year;

(2) files a joint tax return for the taxable year; and

(3) does not participate in a dependent care assistance program as defined in section 129 of the Internal Revenue Code, in lieu of the actual employment related expenses paid for that child under paragraph (a) or the deemed amount under paragraph (b), the lesser of (i) the combined earned income of the couple or (ii) the amount of the maximum limit for one qualified individual under section 21(c) and (d) of the Internal Revenue Code will be deemed to be the employment related expense paid for that child. The earned income limitation of section 21(d) of the Internal Revenue Code shall not apply to this deemed amount. These deemed amounts apply regardless of whether any employment-related expenses have been paid.

<HR><a name=189></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 189</center><HR> (d) If the taxpayer is not required and does not file a federal individual income tax return for the tax year, no credit is allowed for any amount paid to any person unless:

(1) the name, address, and taxpayer identification number of the person are included on the return claiming the credit; or

(2) if the person is an organization described in section 501(c)(3) of the Internal Revenue Code and exempt from tax under section 501(a) of the Internal Revenue Code, the name and address of the person are included on the return claiming the credit.

In the case of a failure to provide the information required under the preceding sentence, the preceding sentence does not apply if it is shown that the taxpayer exercised due diligence in attempting to provide the information required.

In the case of a nonresident, part-year resident, or a person who has earned income not subject to tax under this chapter including earned income excluded pursuant to section 290.01, subdivision 19b, clause (13), the credit determined under section 21 of the Internal Revenue Code must be allocated based on the ratio by which the earned income of the claimant and the claimant's spouse from Minnesota sources bears to the total earned income of the claimant and the claimant's spouse.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

Sec. 8. Minnesota Statutes 2002, section 290.0671, subdivision 1, is amended to read:

Subdivision 1. [CREDIT ALLOWED.] (a) An individual is allowed a credit against the tax imposed by this chapter equal to a percentage of earned income. To receive a credit, a taxpayer must be eligible for a credit under section 32 of the Internal Revenue Code.

(b) For individuals with no qualifying children, the credit equals 1.9125 percent of the first $4,620 of earned income. The credit is reduced by 1.9125 percent of earned income or modified adjusted gross income, whichever is greater, in excess of $5,770, but in no case is the credit less than zero.

(c) For individuals with one qualifying child, the credit equals 8.5 percent of the first $6,920 of earned income and 8.5 percent of earned income over $12,080 but less than $13,450. The credit is reduced by 5.73 percent of earned income or modified adjusted gross income, whichever is greater, in excess of $15,080, but in no case is the credit less than zero.

(d) For individuals with two or more qualifying children, the credit equals ten percent of the first $9,720 of earned income and 20 percent of earned income over $14,860 but less than $16,800. The credit is reduced by 10.3 percent of earned income or modified adjusted gross income, whichever is greater, in excess of $17,890, but in no case is the credit less than zero.

(e) For a nonresident or part-year resident, the credit must be allocated based on the percentage calculated under section 290.06, subdivision 2c, paragraph (e).

(f) For a person who was a resident for the entire tax year and has earned income not subject to tax under this chapter including income excluded under section 290.01, subdivision 19b, clause (13), the credit must be allocated based on the ratio of federal adjusted gross income reduced by the earned income not subject to tax under this chapter over federal adjusted gross income.

<HR><a name=190></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 190</center><HR> (g) For tax years beginning after December 31, 2001, and before December 31, 2004, the $5,770 in paragraph (b) is increased to $6,770, the $15,080 in paragraph (c) is increased to $16,080, and the $17,890 in paragraph (d) is increased to $18,890 for married taxpayers filing joint returns.

(h) For tax years beginning after December 31, 2004, and before December 31, 2007, the $5,770 in paragraph (b) is increased to $7,770, the $15,080 in paragraph (c) is increased to $17,080, and the $17,890 in paragraph (d) is increased to $19,890 for married taxpayers filing joint returns.

(i) For tax years beginning after December 31, 2007, and before December 31, 2010, the $5,770 in paragraph (b) is increased to $8,770, the $15,080 in paragraph (c) is increased to $18,080 and the $17,890 in paragraph (d) is increased to $20,890 for married taxpayers filing joint returns.

(j) The commissioner shall construct tables showing the amount of the credit at various income levels and make them available to taxpayers. The tables shall follow the schedule contained in this subdivision, except that the commissioner may graduate the transition between income brackets.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

Sec. 9. Minnesota Statutes 2002, section 290.091, subdivision 2, is amended to read:

Subd. 2. [DEFINITIONS.] For purposes of the tax imposed by this section, the following terms have the meanings given:

(a) "Alternative minimum taxable income" means the sum of the following for the taxable year:

(1) the taxpayer's federal alternative minimum taxable income as defined in section 55(b)(2) of the Internal Revenue Code;

(2) the taxpayer's itemized deductions allowed in computing federal alternative minimum taxable income, but excluding:

(i) the charitable contribution deduction under section 170 of the Internal Revenue Code to the extent that the deduction exceeds 1.3 percent of adjusted gross income, as defined in section 62 of the Internal Revenue Code;

(ii) the medical expense deduction;

(iii) the casualty, theft, and disaster loss deduction; and

(iv) the impairment-related work expenses of a disabled person;

(3) for depletion allowances computed under section 613A(c) of the Internal Revenue Code, with respect to each property (as defined in section 614 of the Internal Revenue Code), to the extent not included in federal alternative minimum taxable income, the excess of the deduction for depletion allowable under section 611 of the Internal Revenue Code for the taxable year over the adjusted basis of the property at the end of the taxable year (determined without regard to the depletion deduction for the taxable year);

(4) to the extent not included in federal alternative minimum taxable income, the amount of the tax preference for intangible drilling cost under section 57(a)(2) of the Internal Revenue Code determined without regard to subparagraph (E);

<HR><a name=191></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 191</center><HR> (5) to the extent not included in federal alternative minimum taxable income, the amount of interest income as provided by section 290.01, subdivision 19a, clause (1); and

(6) the amount of addition required by section 290.01, subdivision 19a, clause (7);

less the sum of the amounts determined under the following:

(1) interest income as defined in section 290.01, subdivision 19b, clause (1);

(2) an overpayment of state income tax as provided by section 290.01, subdivision 19b, clause (2), to the extent included in federal alternative minimum taxable income;

(3) the amount of investment interest paid or accrued within the taxable year on indebtedness to the extent that the amount does not exceed net investment income, as defined in section 163(d)(4) of the Internal Revenue Code. Interest does not include amounts deducted in computing federal adjusted gross income; and

(4) amounts subtracted from federal taxable income as provided by section 290.01, subdivision 19b, ~~clause~~ clauses (12) and (13).

In the case of an estate or trust, alternative minimum taxable income must be computed as provided in section 59(c) of the Internal Revenue Code.

(b) "Investment interest" means investment interest as defined in section 163(d)(3) of the Internal Revenue Code.

(c) "Tentative minimum tax" equals 6.4 percent of alternative minimum taxable income after subtracting the exemption amount determined under subdivision 3.

(d) "Regular tax" means the tax that would be imposed under this chapter (without regard to this section and section 290.032), reduced by the sum of the nonrefundable credits allowed under this chapter.

(e) "Net minimum tax" means the minimum tax imposed by this section.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

Sec. 10. Minnesota Statutes 2002, section 290.0921, subdivision 3, is amended to read:

Subd. 3. [ALTERNATIVE MINIMUM TAXABLE INCOME.] "Alternative minimum taxable income" is Minnesota net income as defined in section 290.01, subdivision 19, and includes the adjustments and tax preference items in sections 56, 57, 58, and 59(d), (e), (f), and (h) of the Internal Revenue Code. If a corporation files a separate company Minnesota tax return, the minimum tax must be computed on a separate company basis. If a corporation is part of a tax group filing a unitary return, the minimum tax must be computed on a unitary basis. The following adjustments must be made.

(1) For purposes of the depreciation adjustments under section 56(a)(1) and 56(g)(4)(A) of the Internal Revenue Code, the basis for depreciable property placed in service in a taxable year beginning before January 1, 1990, is the adjusted basis for federal income tax purposes, including any modification made in a taxable year under section 290.01, subdivision 19e, or Minnesota Statutes 1986, section 290.09, subdivision 7, paragraph (c).

For taxable years beginning after December 31, 2000, the amount of any remaining modification made under section 290.01, subdivision 19e, or Minnesota Statutes 1986, section 290.09, subdivision 7, paragraph (c), not previously deducted is a depreciation allowance in the first taxable year after December 31, 2000.

<HR><a name=192></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 192</center><HR> (2) The portion of the depreciation deduction allowed for federal income tax purposes under section 168(k) of the Internal Revenue Code that is required as an addition under section 290.01, subdivision 19c, clause (16), is disallowed in determining alternative minimum taxable income.

(3) The subtraction for depreciation allowed under section 290.01, subdivision 19d, clause (19), is allowed as a depreciation deduction in determining alternative minimum taxable income.

(4) The alternative tax net operating loss deduction under sections 56(a)(4) and 56(d) of the Internal Revenue Code does not apply.

(5) The special rule for certain dividends under section 56(g)(4)(C)(ii) of the Internal Revenue Code does not apply.

(6) The special rule for dividends from section 936 companies under section 56(g)(4)(C)(iii) does not apply.

(7) The tax preference for depletion under section 57(a)(1) of the Internal Revenue Code does not apply.

(8) The tax preference for intangible drilling costs under section 57(a)(2) of the Internal Revenue Code must be calculated without regard to subparagraph (E) and the subtraction under section 290.01, subdivision 19d, clause (4).

(9) The tax preference for tax exempt interest under section 57(a)(5) of the Internal Revenue Code does not apply.

(10) The tax preference for charitable contributions of appreciated property under section 57(a)(6) of the Internal Revenue Code does not apply.

(11) For purposes of calculating the tax preference for accelerated depreciation or amortization on certain property placed in service before January 1, 1987, under section 57(a)(7) of the Internal Revenue Code, the deduction allowable for the taxable year is the deduction allowed under section 290.01, subdivision 19e.

For taxable years beginning after December 31, 2000, the amount of any remaining modification made under section 290.01, subdivision 19e, not previously deducted is a depreciation or amortization allowance in the first taxable year after December 31, 2004.

(12) For purposes of calculating the adjustment for adjusted current earnings in section 56(g) of the Internal Revenue Code, the term "alternative minimum taxable income" as it is used in section 56(g) of the Internal Revenue Code, means alternative minimum taxable income as defined in this subdivision, determined without regard to the adjustment for adjusted current earnings in section 56(g) of the Internal Revenue Code.

(13) For purposes of determining the amount of adjusted current earnings under section 56(g)(3) of the Internal Revenue Code, no adjustment shall be made under section 56(g)(4) of the Internal Revenue Code with respect to (i) the amount of foreign dividend gross-up subtracted as provided in section 290.01, subdivision 19d, clause (1), (ii) the amount of refunds of income, excise, or franchise taxes subtracted as provided in section 290.01, subdivision 19d, clause (10), or (iii) the amount of royalties, fees or other like income subtracted as provided in section 290.01, subdivision 19d, clause (11).

(14) Alternative minimum taxable income excludes the income from operating in a job opportunity building zone as provided under section 469.317.

Items of tax preference must not be reduced below zero as a result of the modifications in this subdivision.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

<HR><a name=193></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 193</center><HR> Sec. 11. Minnesota Statutes 2002, section 290.0922, subdivision 2, is amended to read:

Subd. 2. [EXEMPTIONS.] The following entities are exempt from the tax imposed by this section:

(1) corporations exempt from tax under section 290.05;

(2) real estate investment trusts;

(3) regulated investment companies or a fund thereof; and

(4) entities having a valid election in effect under section 860D(b) of the Internal Revenue Code;

(5) town and farmers' mutual insurance companies; ~~and~~

(6) cooperatives organized under chapter 308A that provide housing exclusively to persons age 55 and over and are classified as homesteads under section 273.124, subdivision 3; and

(7) an entity, if for the taxable year all of its property is located in a job opportunity building zone designated under section 469.314 and all of its payroll is a job opportunity building zone payroll under section 469.310.

Entities not specifically exempted by this subdivision are subject to tax under this section, notwithstanding section 290.05.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

Sec. 12. Minnesota Statutes 2002, section 290.0922, subdivision 3, is amended to read:

Subd. 3. [DEFINITIONS.] (a) "Minnesota sales or receipts" means the total sales apportioned to Minnesota pursuant to section 290.191, subdivision 5, the total receipts attributed to Minnesota pursuant to section 290.191, subdivisions 6 to 8, and/or the total sales or receipts apportioned or attributed to Minnesota pursuant to any other apportionment formula applicable to the taxpayer.

(b) "Minnesota property" means total Minnesota tangible property as provided in section 290.191, subdivisions 9 to 11, and any other tangible property located in Minnesota, but does not include property located in a job opportunity building zone designated under section 469.314. Intangible property shall not be included in Minnesota property for purposes of this section. Taxpayers who do not utilize tangible property to apportion income shall nevertheless include Minnesota property for purposes of this section. On a return for a short taxable year, the amount of Minnesota property owned, as determined under section 290.191, shall be included in Minnesota property based on a fraction in which the numerator is the number of days in the short taxable year and the denominator is 365.

(c) "Minnesota payrolls" means total Minnesota payrolls as provided in section 290.191, subdivision 12, but does not include job opportunity building zone payrolls under section 469.310, subdivision 8. Taxpayers who do not utilize payrolls to apportion income shall nevertheless include Minnesota payrolls for purposes of this section.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

<HR><a name=194></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 194</center><HR> Sec. 13. Minnesota Statutes 2002, section 297A.68, is amended by adding a subdivision to read:

Subd. 37. [JOB OPPORTUNITY BUILDING ZONES.] (a) Purchases of tangible personal property or taxable services by a qualified business, as defined in section 469.310, are exempt if the property or services are primarily used or consumed in a job opportunity building zone designated under section 469.314.

(b) Purchase and use of construction materials and supplies for construction of improvements to real property in a job opportunity building zone are exempt if the improvements after completion of construction are to be used in the conduct of a qualified business, as defined in section 469.310. This exemption applies regardless of whether the purchases are made by the business or a contractor.

(c) The exemptions under this subdivision apply to a local sales and use tax regardless of whether the local sales tax is imposed on the sales taxable as defined under this chapter.

(d) This subdivision applies to sales, if the purchase was made and delivery received during the duration of the zone.

[EFFECTIVE DATE.] This section is effective for sales made on or after the day following final enactment.

Sec. 14. Minnesota Statutes 2002, section 297B.03, is amended to read:

297B.03 [EXEMPTIONS.]

There is specifically exempted from the provisions of this chapter and from computation of the amount of tax imposed by it the following:

(1) purchase or use, including use under a lease purchase agreement or installment sales contract made pursuant to section 465.71, of any motor vehicle by the United States and its agencies and instrumentalities and by any person described in and subject to the conditions provided in section 297A.67, subdivision 11;

(2) purchase or use of any motor vehicle by any person who was a resident of another state or country at the time of the purchase and who subsequently becomes a resident of Minnesota, provided the purchase occurred more than 60 days prior to the date such person began residing in the state of Minnesota and the motor vehicle was registered in the person's name in the other state or country;

(3) purchase or use of any motor vehicle by any person making a valid election to be taxed under the provisions of section 297A.90;

(4) purchase or use of any motor vehicle previously registered in the state of Minnesota when such transfer constitutes a transfer within the meaning of section 118, 331, 332, 336, 337, 338, 351, 355, 368, 721, 731, 1031, 1033, or 1563(a) of the Internal Revenue Code of 1986, as amended through December 31, 1999;

(5) purchase or use of any vehicle owned by a resident of another state and leased to a Minnesota based private or for hire carrier for regular use in the transportation of persons or property in interstate commerce provided the vehicle is titled in the state of the owner or secured party, and that state does not impose a sales tax or sales tax on motor vehicles used in interstate commerce;

(6) purchase or use of a motor vehicle by a private nonprofit or public educational institution for use as an instructional aid in automotive training programs operated by the institution. "Automotive training programs" includes motor vehicle body and mechanical repair courses but does not include driver education programs;

<HR><a name=195></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 195</center><HR> (7) purchase of a motor vehicle for use as an ambulance by an ambulance service licensed under section 144E.10;

(8) purchase of a motor vehicle by or for a public library, as defined in section 134.001, subdivision 2, as a bookmobile or library delivery vehicle;

(9) purchase of a ready-mixed concrete truck;

(10) purchase or use of a motor vehicle by a town for use exclusively for road maintenance, including snowplows and dump trucks, but not including automobiles, vans, or pickup trucks;

(11) purchase or use of a motor vehicle by a corporation, society, association, foundation, or institution organized and operated exclusively for charitable, religious, or educational purposes, except a public school, university, or library, but only if the vehicle is:

(i) a truck, as defined in section 168.011, a bus, as defined in section 168.011, or a passenger automobile, as defined in section 168.011, if the automobile is designed and used for carrying more than nine persons including the driver; and

(ii) intended to be used primarily to transport tangible personal property or individuals, other than employees, to whom the organization provides service in performing its charitable, religious, or educational purpose;

(12) purchase of a motor vehicle for use by a transit provider exclusively to provide transit service is exempt if the transit provider is either (i) receiving financial assistance or reimbursement under section 174.24 or 473.384, or (ii) operating under section 174.29, 473.388, or 473.405;

(13) purchase or use of a motor vehicle by a qualified business, as defined in section 469.310, located in a job opportunity building zone, if the motor vehicle is principally garaged in the job opportunity building zone and is primarily used as part of or in direct support of the person's operations carried on in the job opportunity building zone. The exemption under this clause applies to sales, if the purchase was made and delivery received during the duration of the job opportunity building zone. The exemption under this clause also applies to any local sales and use tax.

[EFFECTIVE DATE.] This section is effective for sales made after December 31, 2003.

Sec. 15. [469.310] [DEFINITIONS.]

Subdivision 1. [SCOPE.] For purposes of sections 469.310 to 469.320, the following terms have the meanings given.

Subd. 2. [AGRICULTURAL PROCESSING FACILITY.] "Agricultural processing facility" means one or more facilities or operations that transform, package, sort, or grade livestock or livestock products, agricultural commodities, or plants or plant products into goods that are used for intermediate or final consumption including goods for nonfood use, and surrounding property.

Subd. 3. [APPLICANT.] "Applicant" means a local government unit or units applying for designation of an area as a job opportunity building zone or a joint powers board, established under section 471.59, acting on behalf of two or more local government units.

<HR><a name=196></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 196</center><HR> Subd. 4. [COMMISSIONER.] "Commissioner" means the commissioner of trade and economic development.

Subd. 5. [DEVELOPMENT PLAN.] "Development plan" means a plan meeting the requirements of section 469.311.

Subd. 6. [JOB OPPORTUNITY BUILDING ZONE OR ZONE.] "Job opportunity building zone" or "zone" means a zone designated by the commissioner under section 469.314, and includes an agricultural processing facility zone.

Subd. 7. [JOB OPPORTUNITY BUILDING ZONE PERCENTAGE OR ZONE PERCENTAGE.] "Job opportunity building zone percentage" or "zone percentage" means the following fraction reduced to a percentage:

(1) the numerator of the fraction is:

(i) the ratio of the taxpayer's property factor under section 290.191 located in the zone for the taxable year over the property factor numerator determined under section 290.191, plus

(ii) the ratio of the taxpayer's job opportunity building zone payroll factor under subdivision 8 over the payroll factor numerator determined under section 290.191; and

(2) the denominator of the fraction is two.

When calculating the zone percentage for a business that is part of a unitary business as defined under section 290.17, subdivision 4, the denominator of the payroll and property factors is the Minnesota payroll and property of the unitary business as reported on the combined report under section 290.17, subdivision 4, paragraph (j).

Subd. 8. [JOB OPPORTUNITY BUILDING ZONE PAYROLL FACTOR.] "Job opportunity building zone payroll factor" or "job opportunity building zone payroll" is that portion of the payroll factor under section 290.191 that represents:

(1) wages or salaries paid to an individual for services performed in a job opportunity building zone; or

(2) wages or salaries paid to individuals working from offices within a job opportunity building zone if their employment requires them to work outside the zone and the work is incidental to the work performed by the individual within the zone.

Subd. 9. [LOCAL GOVERNMENT UNIT.] "Local government unit" means a statutory or home rule charter city, county, town, iron range resources and rehabilitation agency, regional development commission, or a federally designated economic development district.

Subd. 10. [PERSON.] "Person" includes an individual, corporation, partnership, limited liability company, association, or any other entity.

Subd. 11. [QUALIFIED BUSINESS.] (a) "Qualified business" means a person carrying on a trade or business at a place of business located within a job opportunity building zone.

(b) A person that relocates a trade or business from outside a job opportunity building zone into a zone is not a qualified business, unless the business:

<HR><a name=197></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 197</center><HR> (1)(i) increases full-time employment in the first full year of operation within the job opportunity building zone by at least 20 percent measured relative to the operations that were relocated and maintains the required level of employment for each year the zone designation applies; or

(ii) makes a capital investment in the property located within a zone equivalent to ten percent of the gross revenues of operation that were relocated in the immediately preceding taxable year; and

(2) enters a binding written agreement with the commissioner that:

(i) pledges the business will meet the requirements of clause (1);

(ii) provides for repayment of all tax benefits enumerated under section 469.315 to the business under the procedures in section 469.319, if the requirements of clause (1) are not met for the taxable year or for taxes payable during the year in which the requirements were not met; and

(iii) contains any other terms the commissioner determines appropriate.

Subd. 12. [RELOCATES.] (a) "Relocates" means that the trade or business:

(1) ceases one or more operations or functions at another location in Minnesota and begins performing substantially the same operations or functions at a location in a job opportunity building zone; or

(2) reduces employment at another location in Minnesota during a period starting one year before and ending one year after it begins operations in a job opportunity building zone and its employees in the job opportunity building zone are engaged in the same line of business as the employees at the location where it reduced employment.

(b) "Relocate" does not include an expansion by a business that establishes a new facility that does not replace or supplant an existing operation or employment, in whole or in part.

(c) "Trade or business" includes any business entity that is substantially similar in operation or ownership to the business entity seeking to be a qualified business under this section.

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

Sec. 16. [469.311] [DEVELOPMENT PLAN.]

(a) An applicant for designation of a job opportunity building zone must adopt a written development plan for the zone before submitting the application to the commissioner.

(b) The development plan must contain, at least, the following:

(1) a map of the proposed zone that indicates the geographic boundaries of the zone, the total area, and present use and conditions generally of the land and structures within those boundaries;

(2) evidence of community support and commitment from local government, local workforce investment boards, school districts, and other education institutions, business groups, and the public;

(3) a description of the methods proposed to increase economic opportunity and expansion, facilitate infrastructure improvement, reduce the local regulatory burden, and identify job-training opportunities;

<HR><a name=198></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 198</center><HR> (4) current social, economic, and demographic characteristics of the proposed zone and anticipated improvements in education, health, human services, and employment if the zone is created;

(5) a description of anticipated activity in the zone and each subzone, including, but not limited to, industrial use, industrial site reuse, commercial or retail use, and residential use; and

(6) any other information required by the commissioner.

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

Sec. 17. [469.312] [JOB OPPORTUNITY BUILDING ZONES; LIMITATIONS.]

Subdivision 1. [MAXIMUM SIZE.] A job opportunity building zone may not exceed 5,000 acres. For a zone designated as an agricultural processing facility zone, the zone also may not exceed the size of a site necessary for the agricultural processing facility, including ancillary operations and space for expansion in the reasonably foreseeable future.

Subd. 2. [SUBZONES.] The area of a job opportunity building zone may consist of one or more noncontiguous areas or subzones.

Subd. 3. [OUTSIDE METROPOLITAN AREA.] The area of a job opportunity building zone must be located outside of the metropolitan area, as defined in section 473.121, subdivision 2.

Subd. 4. [BORDER CITY DEVELOPMENT ZONES.] (a) The area of a job opportunity building zone may not include the area of a border city development zone designated under section 469.1731. The city may remove property from a border city development zone contingent upon the area being designated as a job opportunity building zone. Before removing a parcel of property from a border city development zone, the city must obtain the written consent to the removal from each recipient that is located on the parcel and receives incentives under the border city development zone. Consent of any other property owner or taxpayer in the border city development zone is not required.

(b) A city may not provide tax incentives under section 469.1734 to individuals or businesses for operations or activity in a job opportunity building zone.

Subd. 5. [DURATION LIMIT.] The maximum duration of a zone is 12 years. The applicant may request a shorter duration. The commissioner may specify a shorter duration, regardless of the requested duration.

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

Sec. 18. [469.313] [APPLICATION FOR DESIGNATION.]

Subdivision 1. [WHO MAY APPLY.] One or more local government units, or a joint powers board under section 471.59, acting on behalf of two or more units, may apply for designation of an area as a job opportunity building zone. All or part of the area proposed for designation as a zone must be located within the boundaries of each of the governmental units. A local government unit may not submit or have submitted on its behalf more than one application for designation of a job opportunity building zone.

Subd. 2. [APPLICATION CONTENT.] The application must include:

(1) a development plan meeting the requirements of section 469.311;

<HR><a name=199></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 199</center><HR> (2) the proposed duration of the zone, not to exceed 12 years;

(3) a resolution or ordinance adopted by each of the cities or towns and the counties in which the zone is located, agreeing to provide all of the local tax exemptions provided under section 469.315;

(4) if the proposed zone includes area in a border city development zone, written consent to removal of the property from the border city development zone to the extent required by section 469.312, subdivision 4;

(5) an agreement by the applicant to treat incentives provided under the zone designation as business subsidies under sections 116J.993 to 116J.995 and to comply with the requirements of that law; and

(6) supporting evidence to allow the commissioner to evaluate the application under the criteria in section 469.314.

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

Sec. 19. [469.314] [DESIGNATION OF JOB OPPORTUNITY BUILDING ZONES.]

Subdivision 1. [COMMISSIONER TO DESIGNATE.] (a) The commissioner, in consultation with the commissioner of revenue, shall designate not more than ten job opportunity building zones. In making the designations, the commissioner shall consider need and likelihood of success to yield the most economic development and revitalization of economically distressed rural areas of Minnesota.

(b) In addition to the designations under paragraph (a), the commissioner may, in consultation with the commissioners of agriculture and revenue, designate up to five agricultural processing facility zones.

(c) The commissioner may, upon designation of a zone, modify the development plan, including the boundaries of the zone or subzones, if in the commissioner's opinion a modified plan would better meet the objectives of the job opportunity building zone program. The commissioner shall notify the applicant of the modification and provide a statement of the reasons for the modifications.

Subd. 2. [NEED INDICATORS.] (a) In evaluating applications to determine the need for designation of a job opportunity building zone, the commissioner shall consider the following factors as indicators of need:

(1) the percentage of the population that is below 200 percent of the poverty rate, compared with the state as a whole;

(2) the extent to which the area's average weekly wage is significantly lower than the state average weekly wage;

(3) the amount of property in or near the proposed zone that is deteriorated or underutilized;

(4) the extent to which the median sale price of housing units in the area is below the state median;

(5) the extent to which the median household income of the area is lower than the state median household income;

(6) the extent to which the area experienced a population loss during the 20-year period ending the year before the application is made;

(7) the extent to which an area has experienced sudden or severe job loss as a result of closing of businesses or other employers;

<HR><a name=200></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 200</center><HR> (8) the extent to which property in the area would remain underdeveloped or nonperforming due to physical characteristics;

(9) the extent to which the area has substantial real property with adequate infrastructure and energy to support new or expanded development; and

(10) the extent to which the business startup or expansion rates are significantly lower than the respective rate for the state.

(b) In applying the need indicators, the best available data should be used. If reported data are not available for the proposed zone, data for the smallest area that is available and includes the area of the proposed zone may be used. The commissioner may require applicants to provide data to demonstrate how the area meets one or more of the indicators of need.

Subd. 3. [SUCCESS INDICATORS.] In determining the likelihood of success of a proposed zone, the commissioner shall consider:

(1) the strength and viability of the proposed development goals, objectives, and strategies in the development plan;

(2) whether the development plan is creative and innovative in comparison to other applications;

(3) local public and private commitment to development of the proposed zone and the potential cooperation of surrounding communities;

(4) existing resources available to the proposed zone;

(5) how the designation of the zone would relate to other economic and community development projects and to regional initiatives or programs;

(6) how the regulatory burden will be eased for businesses operating in the proposed zone;

(7) proposals to establish and link job creation and job training; and

(8) the extent to which the development is directed at encouraging and that designation of the zone is likely to result in the creation of high-paying jobs.

Subd. 4. [DESIGNATION SCHEDULE.] (a) The schedule in paragraphs (b) to (f) applies to the designation of job opportunity building zones.

(b) The commissioner shall publish the form for applications and any procedural, form, or content requirements for applications by no later than August 1, 2003. The commissioner may publish these requirements on the Internet, in the State Register, or by any other means the commissioner determines appropriate to disseminate the information to potential applicants for designation.

(d) The commissioner shall designate the zones by no later than December 31, 2003.

(e) The designation of the zones takes effect January 1, 2004.

<HR><a name=201></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 201</center><HR> (f) The commissioner may reserve one or more of the ten authorized zones for a second round of designations in calendar year 2004. If the commissioner chooses to reserve designations for this purpose, the commissioner shall establish the schedule for the second round of designations, notwithstanding the dates in paragraphs (c), (d), and (e). The commissioner shall allow a period of at least 90 days for submission of applications after notification of the second round. A zone designated in the second round takes effect on January 1, 2005.

Subd. 5. [GEOGRAPHIC DISTRIBUTION.] The commissioner shall have as a goal the geographic distribution of zones around the state.

Subd. 6. [RULEMAKING EXEMPTION.] The commissioner's actions in establishing procedures, requirements, and making determinations to administer sections 469.310 to 469.320 are not a rule for purposes of chapter 14 and are not subject to the Administrative Procedure Act contained in chapter 14 and are not subject to section 14.386.

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

Sec. 20. [469.315] [TAX INCENTIVES AVAILABLE IN ZONES.]

Qualified businesses that operate in a job opportunity building zone, individuals who invest in a qualified business that operates in a job opportunity building zone, and property located in a job opportunity building zone qualify for:

(1) exemption from individual income taxes as provided under section 469.316;

(2) exemption from corporate franchise taxes as provided under section 469.317;

(3) exemption from the state sales and use tax and any local sales and use taxes on qualifying purchases as provided in section 297A.68, subdivision 37;

(4) exemption from the state sales tax on motor vehicles and any local sales tax on motor vehicles as provided under section 297B.03;

(5) exemption from the property tax as provided in section 272.02, subdivision 56;

(6) exemption from the wind energy production tax under section 272.029, subdivision 7; and

(7) the jobs credit allowed under section 469.318.

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

Sec. 21. [469.316] [INDIVIDUAL INCOME TAX EXEMPTION.]

Subdivision 1. [APPLICATION.] An individual operating a trade or business in a job opportunity building zone, and an individual making a qualifying investment in a qualified business operating in a job opportunity building zone qualifies for the exemptions from taxes imposed under chapter 290, as provided in this section. The exemptions provided under this section apply only to the extent that the income otherwise would be taxable under chapter 290. Subtractions under this section from federal taxable income, alternative minimum taxable income, or any other base subject to tax are limited to the amount that otherwise would be included in the tax base absent the exemption under this section. This section applies only to taxable years beginning during the duration of the job opportunity building zone.

<HR><a name=202></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 202</center><HR> Subd. 2. [RENTS.] An individual is exempt from the taxes imposed under chapter 290 on net rents derived from real or tangible personal property located in a zone for a taxable year in which the zone was designated a job opportunity building zone. If tangible personal property was used both within and outside of the zone, the exemption amount for the net rental income must be multiplied by a fraction, the numerator of which is the number of days the property was used in the zone and the denominator of which is the total days.

Subd. 3. [BUSINESS INCOME.] An individual is exempt from the taxes imposed under chapter 290 on net income from the operation of a qualified business in a job opportunity building zone. If the trade or business is carried on within and without the zone and the individual is not a resident of Minnesota, the exemption must be apportioned based on the zone percentage for the taxable year. If the trade or business is carried on within and without the zone and the individual is a resident of Minnesota, the exemption must be apportioned based on the zone percentage for the taxable year, except the ratios under section 469.310, subdivision 7, clause (1), items (i) and (ii), must use the denominators of the property and payroll factors determined under section 290.191. No subtraction is allowed under this section in excess of 20 percent of the sum of the job opportunity building zone payroll and the adjusted basis of the property at the time that the property is first used in the job opportunity building zone by the business.

Subd. 4. [CAPITAL GAINS.] (a) An individual is exempt from the taxes imposed under chapter 290 on:

(1) net gain derived on a sale or exchange of real property located in the zone and used by a qualified business. If the property was held by the individual during a period when the zone was not designated, the gain must be prorated based on the percentage of time, measured in calendar days, that the real property was held by the individual during the period the zone designation was in effect to the total period of time the real property was held by the individual;

(2) net gain derived on a sale or exchange of tangible personal property used by a qualified business in the zone. If the property was held by the individual during a period when the zone was not designated, the gain must be prorated based on the percentage of time, measured in calendar days, that the property was held by the individual during the period the zone designation was in effect to the total period of time the property was held by the individual. If the tangible personal property was used outside of the zone during the period of the zone's designation, the exemption must be multiplied by a fraction, the numerator of which is the number of days the property was used in the zone during the time of the designation and the denominator of which is the total days the property was held during the time of the designation; and

(3) net gain derived on a sale of an ownership interest in a qualified business operating in the job opportunity building zone, meeting the requirements of paragraph (b). The exemption on the gain must be multiplied by the zone percentage of the business for the taxable year prior to the sale.

(b) A qualified business meets the requirements of paragraph (a), clause (3), if it is a corporation, an S corporation, or a partnership, and for the taxable year its job opportunity building zone percentage exceeds 25 percent. For purposes of paragraph (a), clause (3), the zone percentage must be calculated by modifying the ratios under section 469.310, subdivision 7, clause (1), items (i) and (ii), to use the denominators of the property and payroll factors determined under section 290.191. Upon the request of an individual holding an ownership interest in the entity, the entity must certify to the owner, in writing, the job opportunity building zone percentage needed to determine the exemption.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

<HR><a name=203></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 203</center><HR> Sec. 22. [469.317] [CORPORATE FRANCHISE TAX EXEMPTION.]

(a) A qualified business is exempt from taxation under section 290.02, the alternative minimum tax under section 290.0921, and the minimum fee under section 290.0922, on the portion of its income attributable to operations within the zone. This exemption is determined as follows:

(1) for purposes of the tax imposed under section 290.02, by multiplying its taxable net income by its zone percentage and subtracting the result in determining taxable income;

(2) for purposes of the alternative minimum tax under section 290.0921, by multiplying its alternative minimum taxable income by its zone percentage and reducing alternative minimum taxable income by this amount; and

(3) for purposes of the minimum fee under section 290.0922, by excluding property and payroll in the zone from the computations of the fee or by exempting the entity under section 290.0922, subdivision 2, clause (7).

(b) No subtraction is allowed under this section in excess of 20 percent of the sum of the corporation's job opportunity building zone payroll and the adjusted basis of the property at the time that the property is first used in the job opportunity building zone by the corporation.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

Sec. 23. [469.318] [JOBS CREDIT.]

Subdivision 1. [CREDIT ALLOWED.] A qualified business is allowed a credit against the taxes imposed under chapter 290. The credit equals seven percent of the:

(1) lesser of:

(i) zone payroll for the taxable year, less the zone payroll for the base year; or

(ii) total Minnesota payroll for the taxable year, less total Minnesota payroll for the base year; minus

(2) $30,000 multiplied by (the number of full-time equivalent employees that the qualified business employs in the job opportunity building zone for the taxable year, minus the number of full-time equivalent employees the business employed in the zone in the base year, but not less than zero).

Subd. 2. [DEFINITIONS.] (a) For purposes of this section, the following terms have the meanings given.

(b) "Base year" means the taxable year beginning during the calendar year prior to the calendar year in which the zone designation took effect.

(d) "Minnesota payroll" means the wages or salaries attributed to Minnesota under section 290.191, subdivision 12, for the qualified business or the unitary business of which the qualified business is a part, whichever is greater.

<HR><a name=204></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 204</center><HR> (e) "Zone payroll" means wages or salaries used to determine the zone payroll factor for the qualified business, less the amount of compensation attributable to any employee that exceeds $100,000.

Subd. 3. [INFLATION ADJUSTMENT.] For taxable years beginning after December 31, 2004, the dollar amounts in subdivision 1, clause (2), and subdivision 2, paragraph (e), are annually adjusted for inflation. The commissioner of revenue shall adjust the amounts by the percentage determined under section 290.06, subdivision 2d, for the taxable year.

Subd. 4. [REFUNDABLE.] If the amount of the credit exceeds the liability for tax under chapter 290, the commissioner of revenue shall refund the excess to the qualified business.

Subd. 5. [APPROPRIATION.] An amount sufficient to pay the refunds authorized by this section is appropriated to the commissioner of revenue from the general fund.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

Sec. 24. [469.319] [REPAYMENT OF TAX BENEFITS.]

Subdivision 1. [REPAYMENT OBLIGATION.] A business must repay the amount of the total tax reduction listed in section 469.315 and any refund under section 469.318 in excess of tax liability, received during the two years immediately before it ceased to operate in the zone, if the business:

(1) received tax reductions authorized by section 469.315; and

(2)(i) did not meet the goals specified in an agreement entered into with the applicant that states any obligation the qualified business must fulfill in order to be eligible for tax benefits. The commissioner may extend for up to one year the period for meeting any goals provided in an agreement. The applicant may extend the period for meeting other goals by documenting in writing the reason for the extension and attaching a copy of the document to its next annual report to the commissioner; or

(ii) ceased to operate its facility located within the job opportunity building zone or otherwise ceases to be or is not a qualified business.

Subd. 2. [DEFINITIONS.] (a) For purposes of this section, the following terms have the meanings given.

(b) "Business" means any person who received tax benefits enumerated in section 469.315.

Subd. 3. [DISPOSITION OR REPAYMENT.] The repayment must be paid to the state to the extent it represents a state tax reduction and to the county to the extent it represents a property tax reduction. Any amount repaid to the state must be deposited in the general fund. Any amount repaid to the county for the property tax exemption must be distributed to the local governments with authority to levy taxes in the zone in the same manner provided for distribution of payment of delinquent property taxes. Any repayment of local sales taxes must be repaid to the city or county imposing the local sales tax.

Subd. 4. [REPAYMENT PROCEDURES.] (a) For the repayment of taxes imposed under chapter 290 or 297A or local taxes collected pursuant to section 297A.99, a business must file an amended return with the commissioner of revenue and pay any taxes required to be repaid within 30 days after ceasing to do business in the zone. The amount required to be repaid is determined by calculating the tax for the period or periods for which repayment is required without regard to the exemptions and credits allowed under section 469.315.

<HR><a name=205></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 205</center><HR> (b) For the repayment of taxes imposed under chapter 297B, a business must pay any taxes required to be repaid to the motor vehicle registrar, as agent for the commissioner of revenue, within 30 days after ceasing to do business in the zone.

(c) For the repayment of property taxes, the county auditor shall prepare a tax statement for the business, applying the applicable tax extension rates for each payable year and provide a copy to the business. The business must pay the taxes to the county treasurer within 30 days after receipt of the tax statement. The taxpayer may appeal the valuation and determination of the property tax to the tax court within 30 days after receipt of the tax statement.

(d) The provisions of chapters 270 and 289A relating to the commissioner's authority to audit, assess, and collect the tax and to hear appeals are applicable to the repayment required under paragraphs (a) and (b). The commissioner may impose civil penalties as provided in chapter 289A, and the additional tax and penalties are subject to interest at the rate provided in section 270.75, from 30 days after ceasing to do business in the job opportunity building zone until the date the tax is paid.

(e) If a property tax is not repaid under paragraph (c), the county treasurer shall add the amount required to be repaid to the property taxes assessed against the property for payment in the year following the year in which the treasurer discovers that the business ceased to operate in the job opportunity building zone.

(f) For determining the tax required to be repaid, a tax reduction is deemed to have been received on the date that the tax would have been due if the taxpayer had not been entitled to the exemption or on the date a refund was issued for a refundable tax credit.

(g) The commissioner may assess the repayment of taxes under paragraph (d) any time within two years after the business ceases to operate in the job opportunity building zone, or within any period of limitations for the assessment of tax under section 289A.38, whichever period is later.

Subd. 5. [WAIVER AUTHORITY.] The commissioner may waive all or part of a repayment, if the commissioner, in consultation with the commissioner of trade and economic development and appropriate officials from the local government units in which the qualified business is located, determines that requiring repayment of the tax is not in the best interest of the state or the local government units and the business ceased operating as a result of circumstances beyond its control including, but not limited to:

(1) a natural disaster;

(2) unforeseen industry trends; or

(3) loss of a major supplier or customer.

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

Sec. 25. [469.320] [ZONE PERFORMANCE; REMEDIES.]

Subdivision 1. [REPORTING REQUIREMENT.] An applicant receiving designation of a job opportunity building zone under section 469.314 must annually report to the commissioner on its progress in meeting the zone performance goals under the development plan for the zone and the applicant's compliance with the business subsidy law under sections 116J.993 to 116J.995.

Subd. 2. [PROCEDURES.] For reports required by subdivision 1, the commissioner may prescribe:

(1) the required time or times by which the reports must be filed;

<HR><a name=206></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 206</center><HR> (2) the form of the report; and

(3) the information required to be included in the report.

Subd. 3. [REMEDIES.] If the commissioner determines, based on a report filed under subdivision 1 or other available information, that a zone or subzone is failing to meet its performance goals, the commissioner may take any actions the commissioner determines appropriate, including modification of the boundaries of the zone or a subzone or termination of the zone or a subzone. Before taking any action, the commissioner shall consult with the applicant and the affected local government units, including notifying them of the proposed actions to be taken. The commissioner shall publish any order modifying a zone in the State Register and on the Internet. The applicant may appeal the commissioner's order under the contested case procedures of chapter 14.

Subd. 4. [EXISTING BUSINESSES.] (a) An action to remove area from a zone or to terminate a zone under this section does not apply to:

(1) the property tax on improvements constructed before the first January 2 following publication of the commissioner's order;

(2) sales tax on purchases made before the first day of the next calendar month beginning at least 30 days after publication of the commissioner's order; and

(3) individual income tax or corporate franchise tax attributable to a facility that was in operation before the publication of the commissioner's order.

(b) The tax exemptions specified in paragraph (a) terminate on the date on which the zone expires under the original designation.

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

Sec. 26. [477A.08] [JOB OPPORTUNITY BUILDING ZONE AID.]

Subdivision 1. [ELIGIBILITY.] (a) For each assessment year that the exemption for job opportunity building zone property is in effect under section 272.02, subdivision 56, the assessor shall determine the difference between the actual net tax capacity and the net tax capacity that would be determined for the job opportunity building zone, including any property removed from the zone that continues to qualify under section 469.320, subdivision 4, if the exemption were not in effect.

(b) Each city and county is eligible for aid equal to one-half of:

(1) the amount by which the sum of the differences determined in paragraph (a) for the corresponding assessment year exceeds three percent of the city's or county's total taxable net tax capacity for taxes payable in 2003, multiplied by

(2) the city's or the county's, as applicable, average local tax rate for taxes payable in 2003.

Subd. 2. [CERTIFICATION.] The county assessor shall notify the commissioner of revenue of the amount determined under subdivision 1, paragraph (b), clause (1), for any city or county that qualifies for aid under this section by June 30 of the assessment year, in a form prescribed by the commissioner. The commissioner shall notify each city and county of its qualifying aid amount by August 15 of the assessment year.

<HR><a name=207></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 207</center><HR> Subd. 3. [APPROPRIATION; PAYMENT.] The commissioner shall pay each city and county its qualifying aid amount by July 20 of the following year. An amount sufficient to pay the aid under this section is appropriated to the commissioner of revenue from the general fund.

[EFFECTIVE DATE.] This section is effective beginning for aid based on property taxes assessed in 2004, payable in 2005.

Sec. 27. [APPROPRIATION; COST OF ADMINISTRATION.]

$100,000 in fiscal year 2004 and $30,000 in fiscal year 2005 are appropriated to the commissioner of trade and economic development for the cost of designating job opportunity building zones.

$53,000 in fiscal year 2004 and $29,000 in fiscal year 2005 are appropriated to the commissioner of revenue for the cost of administering the tax provisions of this act.

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

ARTICLE 2

BIOTECHNOLOGY AND HEALTH SCIENCE ZONES

Section 1. [LEGISLATIVE FINDINGS.]

The legislature finds, as a matter of public policy, that biotechnology and the health sciences hold immense promise in improving the quality of our lives, including curing diseases, making our foods safer and more abundant, reducing our dependence on fossil fuels and foreign oil, making better use of Minnesota agriculture products, and growing tens of thousands of new, high-paying jobs.

The legislature further finds that there are hundreds of discoveries made each year at the University of Minnesota, the Mayo Clinic, and other research institutions that, if properly commercialized, could help provide these benefits.

The legislature further finds that biotechnology and health sciences companies benefit from location in proximity to these research institutions and the many faculty, students, and other intellectual and physical infrastructure these institutions provide.

The legislature further finds that Minnesota's high-quality workforce is attractive to biotechnology and health sciences companies that would want to relocate, start up, or expand in Minnesota.

The legislature further finds and declares that it is appropriate and necessary, to improve our quality of life and as a matter of economic development, that Minnesota take rapid and affirmative steps to encourage the development of biotechnology and the health sciences and the commercialization of important discoveries, especially through expansion of business opportunities in proximity to the research institutions where those discoveries occur. This must include attention to the ethical, legal, and societal impacts of the industry, including risk assessment and environmental protection.

<HR><a name=208></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 208</center><HR> Sec. 2. Minnesota Statutes 2002, section 272.02, is amended by adding a subdivision to read:

Subd. 56. [BIOTECHNOLOGY AND HEALTH SCIENCES INDUSTRY ZONE PROPERTY.] (a) Improvements to real property, and personal property, classified under section 273.13, subdivision 24, and located within a biotechnology and health sciences industry zone are exempt from ad valorem taxes levied under chapter 275, as provided in this subdivision.

(b) For property to qualify for exemption under paragraph (a), the occupant must be a qualified business, as defined in section 469.330.

(c) The exemption applies beginning for the first assessment year after designation of the biotechnology and health sciences industry zone by the commissioner of trade and economic development. The exemption applies to each assessment year that begins during the duration of the biotechnology and health sciences industry zone. This exemption does not apply to:

(1) a levy under section 475.61 or similar levy provisions under any other law to pay general obligation bonds; or

(2) a levy under section 126C.17, if the levy was approved by the voters before the designation of the biotechnology and health sciences industry zone.

(d) The exemption does not apply to taxes imposed by a city, town, or county, unless the governing body adopts a resolution granting the exemption. A city, town, or county may provide a complete property tax exemption, partial property tax exemption, or no property tax exemption to qualified businesses in the biotechnology and health sciences industry zone. "City" includes a statutory or home rule charter city.

(e) For property located in a tax increment financing district, the county shall not adjust the original net tax capacity of the district under section 469.177, subdivision 1, paragraph (a), upon the expiration of an exemption under this subdivision.

[EFFECTIVE DATE.] This section is effective beginning for property taxes assessed in 2004, payable in 2005.

Sec. 3. Minnesota Statutes 2002, section 290.01, subdivision 29, is amended to read:

Subd. 29. [TAXABLE INCOME.] The term "taxable income" means:

(1) for individuals, estates, and trusts, the same as taxable net income;

(2) for corporations, the taxable net income less

(i) the net operating loss deduction under section 290.095; ~~and~~

(ii) the dividends received deduction under section 290.21, subdivision 4; and

(iii) the exemption for operating in a biotechnology and health sciences industry zone under section 469.337.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

<HR><a name=209></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 209</center><HR> Sec. 4. Minnesota Statutes 2002, section 290.06, is amended by adding a subdivision to read:

Subd. 29. [BIOTECHNOLOGY AND HEALTH SCIENCE INDUSTRY ZONE JOB CREDIT.] A taxpayer that is a qualified business, as defined in section 469.330, subdivision 11, is allowed a credit as determined under section 469.338 against the franchise tax imposed under section 290.06, subdivision 1, or the alternative minimum tax imposed under section 290.0921.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

Sec. 5. Minnesota Statutes 2002, section 290.06, is amended by adding a subdivision to read:

Subd. 30. [BIOTECHNOLOGY AND HEALTH SCIENCE INDUSTRY ZONE RESEARCH AND DEVELOPMENT CREDIT.] A taxpayer that is a qualified business, as defined in section 469.330, subdivision 11, is allowed a credit as determined under section 469.339 against the franchise tax imposed under section 290.06, subdivision 1, or the alternative minimum tax imposed under section 290.0921.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

Sec. 6. Minnesota Statutes 2002, section 290.0921, subdivision 3, is amended to read:

(2) The portion of the depreciation deduction allowed for federal income tax purposes under section 168(k) of the Internal Revenue Code that is required as an addition under section 290.01, subdivision 19c, clause (16), is disallowed in determining alternative minimum taxable income.

(3) The subtraction for depreciation allowed under section 290.01, subdivision 19d, clause (19), is allowed as a depreciation deduction in determining alternative minimum taxable income.

(4) The alternative tax net operating loss deduction under sections 56(a)(4) and 56(d) of the Internal Revenue Code does not apply.

(5) The special rule for certain dividends under section 56(g)(4)(C)(ii) of the Internal Revenue Code does not apply.

(6) The special rule for dividends from section 936 companies under section 56(g)(4)(C)(iii) does not apply.

<HR><a name=210></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 210</center><HR> (7) The tax preference for depletion under section 57(a)(1) of the Internal Revenue Code does not apply.

(9) The tax preference for tax exempt interest under section 57(a)(5) of the Internal Revenue Code does not apply.

(10) The tax preference for charitable contributions of appreciated property under section 57(a)(6) of the Internal Revenue Code does not apply.

(14) Alternative minimum taxable income excludes the income from operating in a biotechnology and health sciences industry zone as provided under section 469.337.

Items of tax preference must not be reduced below zero as a result of the modifications in this subdivision.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

Sec. 7. Minnesota Statutes 2002, section 290.0922, subdivision 3, is amended to read:

(b) "Minnesota property" means total Minnesota tangible property as provided in section 290.191, subdivisions 9 to 11, ~~and~~ any other tangible property located in Minnesota, but does not include property of a qualified business located in a biotechnology and health sciences zone designated under section 469.334. Intangible property shall not be included in Minnesota property for purposes of this section. Taxpayers who do not utilize tangible property to apportion income shall nevertheless include Minnesota property for purposes of this section. On a return for a short taxable year, the amount of Minnesota property owned, as determined under section 290.191, shall be included in Minnesota property based on a fraction in which the numerator is the number of days in the short taxable year and the denominator is 365.

<HR><a name=211></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 211</center><HR> (c) "Minnesota payrolls" means total Minnesota payrolls as provided in section 290.191, subdivision 12, but does not include biotechnology and health sciences zone payroll under section 469.330, subdivision 8. Taxpayers who do not utilize payrolls to apportion income shall nevertheless include Minnesota payrolls for purposes of this section.

[EFFECTIVE DATE.] This section is effective for taxable years beginning after December 31, 2003.

Sec. 8. Minnesota Statutes 2002, section 297A.68, is amended by adding a subdivision to read:

Subd. 37. [BIOTECHNOLOGY AND HEALTH SCIENCES INDUSTRY ZONE.] (a) Purchases of tangible personal property or taxable services by a qualified business, as defined in section 469.330, are exempt if the property or services are primarily used or consumed in a biotechnology and health sciences industry zone designated under section 469.334.

(b) Purchase and use of construction materials and supplies for construction of improvements to real property in a biotechnology and health sciences industry zone are exempt if the improvements after completion of construction are to be used in the conduct of a qualified business, as defined in section 469.330. This exemption applies regardless of whether the purchases are made by the business or a contractor.

(c) The exemptions under this subdivision apply to a local sales and use tax regardless of whether the local sales tax is imposed on the sales taxable as defined under this chapter.

(d)(1) The tax on sales of goods or services exempted under this subdivision are imposed and collected as if the applicable rate under section 297A.62 applied. Upon application by the purchaser, on forms prescribed by the commissioner, a refund equal to the tax paid must be paid to the purchaser. The application must include sufficient information to permit the commissioner to verify the sales tax paid and the eligibility of the claimant to receive the credit. No more than two applications for refunds may be filed under this subdivision in a calendar year. The provisions of section 289A.40 apply to the refunds payable under this subdivision.

(2) The amount required to make the refunds is annually appropriated to the commissioner of revenue.

(3) The aggregate amount refunded to a qualified business must not exceed the amount allocated to the qualified business under section 469.335.

(e) This subdivision applies only to sales made during the duration of the designation of the zone.

[EFFECTIVE DATE.] This section is effective for sales made on or after the day following final enactment.

Sec. 9. [469.330] [DEFINITIONS.]

Subdivision 1. [SCOPE.] For purposes of sections 469.330 to 469.341, the following terms have the meanings given.

Subd. 2. [APPLICANT.] "Applicant" means a local government unit or units applying for designation of an area as a biotechnology and health sciences industry zone or a joint powers board, established under section 471.59, acting on behalf of two or more local government units.

Subd. 3. [BIOTECHNOLOGY AND HEALTH SCIENCES INDUSTRY FACILITY.] "Biotechnology and health sciences industry facility" means one or more facilities or operations involved in:

<HR><a name=212></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 212</center><HR> (1) researching, developing, and/or manufacturing a biotechnology product or service or a biotechnology-related health sciences product or service;

(2) researching, developing, and/or manufacturing a biotechnology medical device product or service or a biotechnology-related medical device product or service; or

(3) promoting, supplying, or servicing a facility or operation involved in clause (1) or (2), if the business derives more than 50 percent of its gross receipts from those activities.

Subd. 4. [COMMISSIONER.] "Commissioner" means the commissioner of trade and economic development.

Subd. 5. [DEVELOPMENT PLAN.] "Development plan" means a plan meeting the requirements of section 469.331.

Subd. 6. [BIOTECHNOLOGY AND HEALTH SCIENCES INDUSTRY ZONE OR ZONE.] "Biotechnology and health sciences industry zone" or "zone" means a zone designated by the commissioner under section 469.334.

Subd. 7. [BIOTECHNOLOGY AND HEALTH SCIENCES INDUSTRY ZONE PERCENTAGE OR ZONE PERCENTAGE.] "Biotechnology and health sciences industry zone percentage" or "zone percentage" means the following fraction reduced to a percentage:

(1) the numerator of the fraction is:

(i) the ratio of the taxpayer's property factor under section 290.191 located in the zone for the taxable year over the property factor numerator determined under section 290.191, plus

(ii) the ratio of the taxpayer's biotechnology and health sciences industry zone payroll factor under subdivision 8 over the payroll factor numerator determined under section 290.191; and

(2) the denominator of the fraction is two.

Subd. 8. [BIOTECHNOLOGY AND HEALTH SCIENCES INDUSTRY ZONE PAYROLL FACTOR.] "Biotechnology and health sciences industry zone payroll factor" or "biotechnology and health sciences industry zone payroll" is that portion of the payroll factor under section 290.191 that represents:

(1) wages or salaries paid to an individual for services performed for a qualified business in a biotechnology and health sciences industry zone; or

(2) wages or salaries paid to individuals working from offices of a qualified business within a biotechnology and health sciences industry zone if their employment requires them to work outside the zone and the work is incidental to the work performed by the individual within the zone.

Subd. 9. [LOCAL GOVERNMENT UNIT.] "Local government unit" means a statutory or home rule charter city, county, town, or school district.

<HR><a name=213></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 213</center><HR> Subd. 10. [PERSON.] "Person" includes an individual, corporation, partnership, limited liability company, association, or any other entity.

Subd. 11. [QUALIFIED BUSINESS.] (a) "Qualified business" means a person carrying on a trade or business at a biotechnology and health sciences industry facility located within a biotechnology and health sciences industry zone.

(b) A person that relocates a biotechnology and health sciences industry facility from outside a biotechnology and health sciences industry zone into a zone is not a qualified business, unless the business:

(1)(i) increases full-time employment in the first full year of operation within the biotechnology and health sciences industry zone by at least 20 percent measured relative to the operations that were relocated and maintains the required level of employment for each year the zone designation applies; or

(ii) makes a capital investment in the property located within a zone equivalent to ten percent of the gross revenues of operation that were relocated in the immediately preceding taxable year; and

(2) enters a binding written agreement with the commissioner that:

(i) pledges the business will meet the requirements of clause (1);

(ii) provides for repayment of all tax benefits enumerated under section 469.336 to the business under the procedures in section 469.340, if the requirements of clause (1) are not met; and

(iii) contains any other terms the commissioner determines appropriate.

Subd. 12. [RELOCATES.] (a) "Relocates" means that the trade or business:

(1) ceases one or more operations or functions at another location in Minnesota and begins performing substantially the same operations or functions at a location in a biotechnology and health sciences industry zone; or

(2) reduces employment at another location in Minnesota during a period starting one year before and ending one year after it begins operations in a biotechnology and health sciences industry zone and its employees in the biotechnology and health sciences industry zone are engaged in the same line of business as the employees at the location where it reduced employment.

(b) "Relocate" does not include an expansion by a business that establishes a new facility that does not replace or supplant an existing operation or employment, in whole or in part.

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

Sec. 10. [469.331] [DEVELOPMENT PLAN.]

(a) An applicant for designation of a biotechnology and health sciences industry zone must adopt a written development plan for the zone before submitting the application to the commissioner.

(b) The development plan must contain, at least, the following:

(1) a map of the proposed zone that indicates the geographic boundaries of the zone, the total area, and present use and conditions generally of the land and structures within those boundaries;

<HR><a name=214></a><center>Journal of the House - 6th Day - Tuesday, May 27, 2003 - Top of Page 214</center><HR> (2) evidence of community support and commitment from local government, local workforce investment boards, school districts, and other education institutions, business groups, and the public;

(4) current social, economic, and demographic characteristics of the proposed zone and anticipated improvements in education, health, human services, and employment if the zone is created;

(5) a description of anticipated activity in the zone and each subzone, including, but not limited to, industrial use and industrial site reuse;

(6) a description of the tax exemptions under section 469.336 to be provided to each qualifying business based on a development agreement between the applicant and each qualified business. The development agreement must also state any obligations the qualified business must fulfill in order to be eligible for tax benefits; and

(7) any other information required by the commissioner.

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

Sec. 11. [469.332] [BIOTECHNOLOGY AND HEALTH SCIENCES INDUSTRY ZONE; LIMITATIONS.]

Subdivision 1. [MAXIMUM SIZE.] A biotechnology and health sciences industry zone may not exceed 5,000 acres.

Subd. 2. [SUBZONES.] The area of a biotechnology and health sciences industry zone may consist of one or more noncontiguous areas or subzones.

Subd. 3. [DURATION LIMIT.] The maximum duration of a zone is 12 years. The applicant may request a shorter duration. The commissioner may specify a shorter duration, regardless of the requested duration.

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

Sec. 12. [469.333] [APPLICATION FOR DESIGNATION.]

Subdivision 1. [WHO MAY APPLY.] One or more local government units, or a joint powers board under section 471.59, acting on behalf of two or more units, may apply for designation of an area as a biotechnology and health sciences industry zone. All or part of the area proposed for designation as a zone must be located within the boundaries of each of the governmental units. A local government unit may not submit or have submitted on its behalf more than one application for designation of a biotechnology and health sciences industry zone.

Subd. 2. [APPLICATION CONTENT.] The application must include:

(1) a development plan meeting the requirements of section 469.331;

(2) the proposed duration of the zone, no