House Journal 92nd Day Tuesday April 19 2022

A quorum was present.

Baker, Dettmer, Lueck and Torkelson were excused.

The Chief Clerk proceeded to read the Journal of the preceding day. There being no objection, further reading of the Journal was dispensed with and the Journal was approved as corrected by the Chief Clerk.

Journal of the House - 92nd Day - Tuesday, April 19, 2022 - Top of Page 9368

PETITIONS AND COMMUNICATIONS

The following communications were received:

STATE OF MINNESOTA

OFFICE OF THE GOVERNOR

SAINT PAUL 55155

April 8, 2022

The Honorable Melissa Hortman

Speaker of the House of Representatives

The State of Minnesota

Dear Speaker Hortman:

Please be advised that I have received, approved, signed, and deposited in the Office of the Secretary of State the following House File:

H. F. No. 3217, relating to agriculture; protecting data about individuals who seek mental or behavioral health assistance or who contact the Minnesota Farm and Rural Helpline; appropriating money for avian influenza.

Sincerely,

Tim Walz

Governor

STATE OF MINNESOTA

OFFICE OF THE SECRETARY OF STATE

ST. PAUL 55155

The Honorable Melissa Hortman

Speaker of the House of Representatives

The Honorable David J. Osmek

President of the Senate

I have the honor to inform you that the following enrolled Act of the 2022 Session of the State Legislature has been received from the Office of the Governor and is deposited in the Office of the Secretary of State for preservation, pursuant to the State Constitution, Article IV, Section 23:

S. F.

No.

H. F.

No.

Session Laws

Chapter No.

Time and

Date Approved

2022

Date Filed

2022

3217 47 12:57 p.m. April 8 April 8

Sincerely,

Steve Simon

Secretary of State

Journal of the House - 92nd Day - Tuesday, April 19, 2022 - Top of Page 9369

STATE OF MINNESOTA

OFFICE OF THE GOVERNOR

SAINT PAUL 55155

April 13, 2022

The Honorable Melissa Hortman

Speaker of the House of Representatives

The State of Minnesota

Dear Speaker Hortman:

Please be advised that I have received, approved, signed, and deposited in the Office of the Secretary of State the following House Files:

H. F. No. 2819, relating to natural resources; increasing civil penalties for violations of snowmobile and off‑highway vehicle provisions.

H. F. No. 3620, relating to labor and industry; allowing a licensed residential building contractor to receive an installation seal for the installation of used manufactured homes; clarifying that a used manufactured home may bear a label or data plate.

Sincerely,

Tim Walz

Governor

STATE OF MINNESOTA

OFFICE OF THE SECRETARY OF STATE

ST. PAUL 55155

The Honorable Melissa Hortman

Speaker of the House of Representatives

The Honorable David J. Osmek

President of the Senate

I have the honor to inform you that the following enrolled Acts of the 2022 Session of the State Legislature have been received from the Office of the Governor and are deposited in the Office of the Secretary of State for preservation, pursuant to the State Constitution, Article IV, Section 23:

S. F.

No.

H. F.

No.

Session Laws

Chapter No.

Time and

Date Approved

2022

Date Filed

2022

2736 45 1:30 p.m. April 13 April 13

2819 46 1:30 p.m. April 13 April 13

3620 48 1:30 p.m. April 13 April 13

Sincerely,

Steve Simon

Secretary of State

Journal of the House - 92nd Day - Tuesday, April 19, 2022 - Top of Page 9370

REPORTS OF STANDING COMMITTEES AND DIVISIONS

Noor from the Committee on Workforce and Business Development Finance and Policy to which was referred:

H. F. No. 1200, A bill for an act relating to employment; providing for paid family, pregnancy, bonding, and applicant's serious medical condition benefits; regulating and requiring certain employment leaves; classifying certain data; authorizing rulemaking; appropriating money; amending Minnesota Statutes 2020, sections 13.719, by adding a subdivision; 177.27, subdivision 4; 181.032; 256J.561, by adding a subdivision; 256J.95, subdivisions 3, 11; 256P.01, subdivision 3; 268.19, subdivision 1; proposing coding for new law as Minnesota Statutes, chapter 268B.

Reported the same back with the following amendments:

Page 10, delete subdivision 22 and insert:

"Subd. 22. Family member. (a) "Family member" means, with respect to an employee:

(1) a spouse, including a domestic partner in a civil union or other registered domestic partnership recognized by the state, and a spouse's parent;

(2) a child and a child's spouse;

(3) a parent and a parent's spouse;

(4) a sibling and a sibling's spouse;

(5) a grandparent, a grandchild, or a spouse of a grandparent or grandchild; and

(6) any other individual who is related by blood or affinity and whose association with the employee is equivalent of a family relationship. For the purposes of this clause, with respect to an employee, this includes but is not limited to:

(i) a child of a sibling of the employee;

(ii) a sibling of the parents of the employee;

(iii) a child-in-law, a parent-in-law, a sibling-in-law, and a grandparent-in-law; and

(iv) an individual who has resided at the same address as the employee for at least one year as of the first day of leave under this chapter.

(b) For the purposes of this chapter, a child includes a stepchild; biological, adopted, or foster child of the employee; or a child for whom the employee is standing in loco parentis.

(c) For the purposes of this chapter, a grandchild includes a step-grandchild or biological, adopted, or foster grandchild of the employee."

Page 11, line 10, before "perform" insert "fully"

Page 19, line 29, delete "may" and insert "shall"

Page 23, line 18, delete everything after "unless" and insert "an appeal is filed by the applicant within 30 calendar days after the sending of the determination or amended determination, or within 60 calendar days, if an applicant establishes good cause for not appealing within 30 days. For the purposes of this paragraph, "good cause" means a reason that would have prevented an applicant from acting with due diligence in appealing within 30 days and includes any illness, disability, or linguistic and literacy limitation of the applicant, along with other relevant factors. If an applicant claims good cause for a late appeal, the applicant must be granted a hearing on the issue of timeliness. This hearing can be held at the same time as a hearing on the merits of the appeal."

Journal of the House - 92nd Day - Tuesday, April 19, 2022 - Top of Page 9371

Page 23, delete lines 19 and 20

Page 23, line 21, delete everything before "Proceedings"

Page 25, line 11, delete "must" and insert "shall"

Page 30, line 3, delete "20" and insert "30" and before the period, insert ", or within 60 calendar days, if the applicant establishes good cause for not appealing within 30 days. For the purposes of this paragraph, "good cause" means a reason that would have prevented an applicant from acting with due diligence in appealing within 30 days and includes any illness, disability, or linguistic and literacy limitation of the applicant, along with other relevant factors. If an applicant claims good cause for a late appeal, the applicant must be granted a hearing on the issue of timeliness. This hearing can be held at the same time as a hearing on the merits of the appeal"

Page 31, line 30, delete "verbal" and insert "oral, telephone, or text message"

Page 32, delete line 19 and insert "if such leave is reasonable and appropriate to the needs of the individual with the serious health condition."

Page 35, line 24, delete "would have" and insert "has"

Page 35, line 26, delete ". Restoration"

Page 39, line 14, delete "October" and insert "December"

Page 39, line 15, delete "2022" and insert "2024" and delete "268B.21" and insert "268B.24"

Page 45, line 29, delete "2023" and insert "2025"

Page 50, line 16, delete "2023" and insert "2025" and delete "2023" and insert "2025"

Page 50, line 18, delete "2024" and insert "2025"

Page 50, line 25, delete "2023" and insert "2025"

Page 51, line 17, delete "20" and insert "30"

Page 51, line 18, after the comma, insert "or within 60 calendar days, if the applicant establishes good cause for not appealing within 30 days,"

Page 51, line 19, after the period, insert "For the purposes of this paragraph, "good cause" means a reason that would have prevented an applicant from acting with due diligence in appealing within 30 days and includes any illness, disability, or linguistic and literacy limitation of the applicant, along with other relevant factors. If an applicant claims good cause for a late appeal, the applicant must be granted a hearing on the issue of timeliness. This hearing can be held at the same time as a hearing on the merits of the appeal."

Page 60, line 21, delete "2023" and insert "2024"

Page 61, line 7, delete "2023" and insert "2024"

Page 64, delete section 38 and insert:

"Sec. 38. APPROPRIATIONS.

(a) $1,700,000,000 in fiscal year 2023 is appropriated from the general fund to the commissioner of employment and economic development for transfer to the family and medical insurance benefit account for the purposes of Minnesota Statutes, chapter 268B, including:

Journal of the House - 92nd Day - Tuesday, April 19, 2022 - Top of Page 9372

(1) payment of family and medical benefits for calendar years 2024 and 2025;

(2) implementation and administration of the family and medical benefit insurance program;

(3) staffing, outreach, information technology implementation, and related activities; and

(4) outreach, education, and technical assistance for employees, employers, and self-employed individuals regarding Minnesota Statutes, chapter 268B.

This is a onetime appropriation and is available until June 30, 2026. Any unspent money cancels to the general fund.

(b) $....... in fiscal year 2027 is appropriated from the family and medical insurance benefit account to the commissioner of employment and economic development for the purposes of Minnesota Statutes, chapter 268B, including administration of the family and medical benefit insurance program, and outreach, education, and technical assistance for employees, employers, and self-employed individuals. Of the amount used for outreach, education, and technical assistance, at least half must be used for grants to community-based groups providing outreach, education, and technical assistance for employees, employers, and self-employed individuals regarding Minnesota Statutes, chapter 268B. Outreach must include efforts to notify self-employed individuals of their ability to elect coverage under Minnesota Statutes, section 268B.11, and providing individuals with technical assistance to elect coverage. The base for fiscal year 2028 and beyond is $.........

Sec. 39. EFFECTIVE DATES.

(a) Family and medical benefits under Minnesota Statutes, chapter 268B, may be applied for and paid starting January 1, 2024. Notwithstanding Minnesota Statutes, section 268B.03, or any other law to the contrary, for calendar years 2024 and 2025, the commissioner shall pay benefits under this chapter from the money appropriated in section 38.

(b) Sections 1, 2, 4, 5, and 6 are effective July 1, 2022.

(d) Except as provided in paragraph (a), sections 7 to 14, 16 to 18, 20, 22, 26 to 31, and 33 to 36 are effective January 1, 2024.

(e) Sections 3, 19, 21, 23 to 25, and 32 are effective January 1, 2025."

Page 67, line 5, delete "July" and insert "January"

Page 67, delete article 3

With the recommendation that when so amended the bill be re-referred to the Committee on Ways and Means.

The report was adopted.

Hornstein from the Committee on Transportation Finance and Policy to which was referred:

H. F. No. 1683, A bill for an act relating to transportation; correcting cross-references; amending Minnesota Statutes 2020, sections 162.145, subdivision 3; 171.06, subdivision 3.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

Journal of the House - 92nd Day - Tuesday, April 19, 2022 - Top of Page 9373

"ARTICLE 1

TRANSPORTATION APPROPRIATIONS

Section 1. APPROPRIATIONS.

The sums shown in the column under "Appropriations" are added to the appropriations in Laws 2021, First Special Session chapter 5, article 1, to the agencies and for the purposes specified in this article. The appropriations are from the trunk highway fund, or another named fund, and are available for the fiscal years indicated for each purpose. Amounts for "Total Appropriation" and sums shown in the corresponding columns marked "Appropriations by Fund" are summary only and do not have legal effect. The figures "2022" and "2023" used in this article mean that the addition to the appropriations listed under them is available for the fiscal year ending June 30, 2022, or June 30, 2023, respectively. Supplemental appropriations and reductions to appropriations for the fiscal year ending June 30, 2022, are effective the day following final enactment.

			APPROPRIATIONS
			Available for the Year
			Ending June 30
			2022	2023

Sec. 2. DEPARTMENT OF TRANSPORTATION

Subdivision 1. Total Appropriation			$197,423,000	$435,090,000

Appropriations by Fund

	2022	2023

General	-0-	189,715,000
Airports	-0-	5,500,000
Trunk Highway	197,423,000	239,875,000

The appropriations in this section are to the commissioner of transportation.

The amounts that may be spent for each purpose are specified in the following subdivisions.

Subd. 2. Multimodal Systems

(a) Aeronautics

(1) Aviation Support Services

-0-

7,000,000

This appropriation is from the general fund to purchase two utility aircraft for the Department of Transportation. This is a onetime appropriation.

(2) IIJA Match

-0-

5,500,000

This appropriation is from the state airports fund for expenditure in accordance with Minnesota Statutes, section 360.305, subdivision 4. This is a onetime appropriation.

(b) Transit and Active Transportation

(1) IIJA Match; Operating Adjustment

-0-

10,000,000

This appropriation is from the general fund for the public transit participation program under Minnesota Statutes, section 174.24. This is a onetime appropriation.

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(2) Active Transportation

-0-

12,500,000

This appropriation is from the general fund for the active transportation program under Minnesota Statutes, section 174.38. This is a onetime appropriation and is available until June 30, 2024.

The base is $6,150,000 in each of fiscal years 2024 and 2025.

-0-

1,859,000

This appropriation is from the general fund for the safe routes to school program under Minnesota Statutes, section 174.40. This is a onetime appropriation.

(d) Passenger Rail

(1) Rail Service

-0-

740,000

This appropriation is from the general fund for operating costs related to second daily passenger rail train service between Minneapolis and St. Paul and Chicago.

The base is $1,490,000 in fiscal year 2024 and $2,200,000 in fiscal year 2025.

(2) Northern Lights Express

-0-

51,000,000

This appropriation is from the general fund for capital improvements and betterments, including preliminary engineering, design, engineering, environmental analysis and mitigation, acquisition of land and right-of-way, and construction of the Minneapolis-Duluth Northern Lights Express inter-city passenger rail project. This appropriation is available until June 30, 2027.

The base is $17,000,000 in each of fiscal years 2024 and 2025 and $0 in fiscal year 2026 and thereafter.

(e) Freight

-0-

1,000,000

This appropriation is from the general fund for Minnesota rail service improvement program grants under Minnesota Statutes, section 222.50. This is a onetime appropriation.

Subd. 3. State Roads

(a) Operations and Maintenance

4,000,000

8,805,000

Appropriations by Fund

	2022	2023

General	-0-	1,000,000
Trunk Highway	4,000,000	7,805,000

$330,000 in fiscal year 2023 from the trunk highway fund is to acquire, build, plant, and improve living snow fences consisting of trees, shrubs, native grasses, and wildflowers. This appropriation

Journal of the House - 92nd Day - Tuesday, April 19, 2022 - Top of Page 9375

includes costs of acquiring and planting trees and shrubs that are climate adaptive to Minnesota, contracts, easements, rental agreements, and program delivery.

$1,000,000 in fiscal year 2023 from the general fund is for the highways for habitat program under Minnesota Statutes, section 160.2325. This is a onetime appropriation.

The base is $367,681,000 in each of fiscal years 2024 and 2025.

(b) Program Delivery

-0-

10,802,000

This appropriation includes use of consultants to support development and management of projects.

The base is $242,920,000 in fiscal year 2024 and $244,101,000 in fiscal year 2025.

191,223,000

213,463,000

Appropriations by Fund

	2022	2023

General	-0-	2,000,000
Trunk Highway	191,223,000	216,019,000

This appropriation is for the actual construction, reconstruction, and improvement of trunk highways, including design-build contracts, internal department costs associated with delivering the construction program, consultant usage to support these activities, and the cost of actual payments to landowners for lands acquired for highway rights-of-way, payment to lessees, interest subsidies, and relocation expenses.

$2,000,000 in fiscal year 2023 from the general fund is to acquire, build, plant, and improve living snow fences consisting of trees, shrubs, native grasses, and wildflowers. This appropriation includes costs of acquiring and planting trees and shrubs that are climate adaptive to Minnesota, contracts, easements, rental agreements, and program delivery. This is a onetime appropriation and is available until June 30, 2026.

The base for the trunk highway fund is $1,148,794,000 in fiscal year 2024 and $1,160,413,000 in fiscal year 2025.

(d) Highway Debt Service

-0-

1,511,000

Any excess appropriation cancels to the trunk highway fund.

(e) Statewide Radio Communications

-0-

2,000,000

This appropriation is from the general fund to predesign, design, construct, equip, and furnish the system backbone of the public safety radio and communication system plan under Minnesota Statutes, section 403.36. This is a onetime appropriation and is available until June 30, 2025.

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Subd. 4. Local Roads

(a) County State-Aid Highways

(1) IIJA Match

-0-

30,868,000

This appropriation is from the general fund for county state-aid highways, to be distributed in the manner provided under Minnesota Statutes, chapter 162. This is a onetime appropriation.

(2) Town Roads

-0-

4,000,000

This appropriation is from the general fund for town roads, to be distributed in the manner provided under Minnesota Statutes, section 162.081. This is a onetime appropriation.

(b) Municipal State-Aid Streets; IIJA Match

-0-

9,748,000

This appropriation is from the general fund for municipal state-aid streets, to be distributed in the manner provided under Minnesota Statutes, chapter 162. This is a onetime appropriation.

-0-

10,000,000

This appropriation is from the general fund for the small cities assistance program under Minnesota Statutes, section 162.145.

The base is $10,000,000 in each of fiscal years 2024 and 2025.

Subd. 5. Agency Management

(a) Agency Services

-0-

3,378,000

The base for the trunk highway fund is $66,784,000 in fiscal year 2024 and $67,192,000 in fiscal year 2025.

(b) Buildings

2,200,000

-0-

This appropriation is to predesign, design, construct, and equip the Hutchinson Area Transportation Services addition.

(1) Federal Funds Local Assistance

-0-

36,800,000

This appropriation is from the general fund for the federal funds local assistance program under Minnesota Statutes, section 174.125. This is a onetime appropriation and is available until June 30, 2026.

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(2) Federal Grants Technical Assistance

-0-

400,000

This appropriation is from the general fund for federal grants technical assistance under Minnesota Statutes, section 174.127.

The base is $400,000 in each of fiscal years 2024 and 2025.

(3) Electric Vehicle Infrastructure

-0-

6,800,000

This appropriation is from the general fund for the match requirements for formula and discretionary grant programs enacted in the federal Infrastructure Investment and Jobs Act, Public Law 117-58, related to electric vehicle infrastructure and alternative fuel corridors. From this amount, the commissioner may make grants to local units of government. This is a onetime appropriation and is available until June 30, 2026. If the match requirements are met, the commissioner may expend any unspent portion of this appropriation under the federal funds local assistance program in Minnesota Statutes, section 174.125.

The base is $3,400,000 in each of fiscal years 2024 and 2025.

(4) Climate Funding Maximization

-0-

2,000,000

This appropriation is from the general fund for implementation of climate-related programs under the federal Infrastructure Investment and Jobs Act, Public Law 117-58.

The base is $2,000,000 in each of fiscal years 2024 and 2025.

Sec. 3. METROPOLITAN COUNCIL

Subdivision 1. Total Appropriation

$-0-

$31,180,000

The appropriations in this section are from the general fund to the Metropolitan Council.

The amounts that may be spent for each purpose are specified in the following subdivisions.

Subd. 2. Transit System Operations

(a) IIJA Match; Operating Adjustment

-0-

20,075,000

This appropriation is for transit system operations under Minnesota Statutes, sections 473.371 to 473.449. This is a onetime appropriation.

$75,000 in fiscal year 2023 is for transit signal priority systems planning.

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(b) Zero-Emission Bus Transition

-0-

5,000,000

This appropriation is for zero-emission bus procurement, charging infrastructure, and associated costs, in conformance with the zero‑emission and electric transit vehicle transition plan under Minnesota Statutes, section 473.3927.

The base is $5,000,000 in each of fiscal years 2024 and 2025 and $0 in fiscal year 2026 and thereafter.

-0-

500,000

This appropriation is for arterial bus rapid transit planning on the J, K, and L Line projects.

The base is $500,000 in each of fiscal years 2024 and 2025.

(d) Transit Shelter Improvements

-0-

2,000,000

This appropriation is for transit shelter replacement and improvements under Minnesota Statutes, section 473.41. This is a onetime appropriation.

Subd. 3. Microtransit Service

-0-

1,300,000

This appropriation is for financial assistance to replacement service providers under Minnesota Statutes, section 473.388, to provide expansion and improvements to demand response transit service. The council must make grants to Maple Grove Transit, Minnesota Valley Transit Authority, Plymouth Metrolink, and SouthWest Transit in the amounts specified by the Suburban Transit Association. The council must not retain any portion of the funds under this appropriation. This is a onetime appropriation.

Subd. 4. Transit Fare Temporary Reduction

-0-

2,305,000

(a) This appropriation is for transit system operations under Minnesota Statutes, sections 473.371 to 473.449, to provide for foregone revenue due to the requirements in paragraph (b). From this amount, the Metropolitan Council must provide grants to replacement service providers under Minnesota Statutes, section 473.388, in amounts that reflect calculated foregone revenue for each provider due to the requirements in paragraph (b). This is a onetime appropriation.

(b) From July 1, 2022, to August 31, 2022, the Metropolitan Council must: (1) establish a uniform fare schedule that does not exceed $1 for all bus and light rail transit service during peak and nonpeak service hours, including but not limited to express bus and bus rapid transit; and (2) establish a discount under the student, collegiate, and Metropass transit pass programs. The Metropolitan Council may adjust any other reduced, discounted, and circulation fares accordingly.

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(c) After accounting for foregone revenue, the Metropolitan Council may use any remaining funds from the appropriation in this subdivision for transit shelter replacement and improvements under Minnesota Statutes, section 473.41.

Sec. 4. DEPARTMENT OF PUBLIC SAFETY

Subdivision 1. Total Appropriation

$4,325,000

$8,102,000

Appropriations by Fund

	2022	2023

General	400,000	3,705,000
Special Revenue	3,925,000	2,397,000
Trunk Highway	-0-	2,000,000

The appropriations in this section are from the general fund, or another named fund, to the commissioner of public safety.

The amounts that may be spent for each purpose are specified in the following subdivisions.

Subd. 2. Administration and Related Services

(a) Public Safety Officer Survivor Benefits

-0-

1,000,000

This appropriation is from the general fund for payment of public safety officer survivor benefits under Minnesota Statutes, section 299A.44.

The base is $1,640,000 in each of fiscal years 2024 and 2025.

(b) Soft Body Armor Reimbursements

400,000

205,000

This appropriation is from the general fund for soft body armor reimbursements under Minnesota Statutes, section 299A.38.

The base is $950,000 in each of fiscal years 2024 and 2025.

Subd. 3. State Patrol; Commercial Vehicle Enforcement

-0-

2,000,000

This appropriation is from the trunk highway fund.

The base is $15,110,000 in each of fiscal years 2024 and 2025.

Subd. 4. Driver and Vehicle Services

(a) Driver Services

-0-

2,206,000

This appropriation is from the driver services operating account in the special revenue fund under Minnesota Statutes, section 299A.705, subdivision 2.

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$1,029,000 in fiscal year 2023 is for installation and maintenance of security cameras at Driver and Vehicle Services exam sites that are open five or more days per week and for replacement of existing security cameras at the St. Paul examination station. This is a onetime appropriation.

$153,000 in fiscal year 2023 is for the ongoing costs, including costs of staff and information technology operations, of the security cameras installed at Driver and Vehicle Services examination sites.

$100,000 in fiscal year 2023 is for reimbursement to deputy registrars and driver's license agents for the purchase and installation of security cameras at deputy registrar or driver's license agent office locations. Deputy registrars and driver's license agents may submit an application to the commissioner for reimbursement of funds spent to purchase and install security cameras. Upon approval of an application for reimbursement, the commissioner must pay the applicant the lesser of one-half the purchase and installation price or $5,000. When approving applications, the commissioner must prioritize offices that do not currently have security cameras installed. This is a onetime appropriation.

$91,000 in fiscal year 2023 is for data auditing capacity enhancements, including costs of staff and equipment.

$750,000 in fiscal year 2023 is for reimbursement to limited‑service driver's license agents for the purchase of equipment necessary for a full-service provider, as defined in section 171.01, subdivision 33a, following application to the commissioner. The commissioner may provide no more than $15,000 to each driver's license agent. This is a onetime appropriation.

$83,000 in fiscal year 2023 is only available if legislation is enacted in the 2022 regular legislative session that establishes requirements for the commissioner of public safety governing a watercraft operator's permit indicator on drivers' licenses and Minnesota identification cards, and this amount is for the applicable implementation costs.

The base is $36,640,000 in each of fiscal years 2024 and 2025.

(b) Vehicle Services

3,925,000

191,000

This appropriation is from the vehicle services operating account in the special revenue fund under Minnesota Statutes, section 299A.705.

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$3,925,000 in fiscal year 2022 is for the mailing and production costs of license plates.

$90,000 in fiscal year 2023 is for data auditing capacity enhancements, including costs of staff and equipment.

$101,000 in fiscal year 2023 is for an appeals process for information technology system data access revocations, including costs of staff and equipment.

The base is $33,970,000 in each of fiscal years 2024 and 2025.

Subd. 5. Traffic Safety

-0-

2,500,000

This appropriation is from the general fund for traffic safety activities, including: (1) for staff and operating costs of the Traffic Safety Advisory Council under Minnesota Statutes, section 4.075; (2) to develop the speed safety camera pilot project implementation plan under article 3, section 58; and (3) to expand public outreach and education, coordination and assistance on traffic safety initiatives, grants, and program and project management.

The commissioner may expend up to $20,000 in fiscal year 2023 from the driver and vehicle services technology account in the special revenue fund under Minnesota Statutes, section 299A.705, for records access enhancements to the MNCrash information technology system.

The base for the general fund is $2,978,000 in each of fiscal years 2024 and 2025.

Sec. 5. Laws 2021, First Special Session chapter 5, article 1, section 4, subdivision 3, is amended to read:

Subd. 3. State Patrol

(a) Patrolling Highways

113,823,000

112,170,000

Appropriations by Fund

	2022	2023

General	37,000	37,000
H.U.T.D.	92,000	92,000
Trunk Highway	113,694,000	112,041,000

$3,524,000 in fiscal year 2022 and $2,822,000 in fiscal year 2023 are from the trunk highway fund for the purchase, deployment, and management of body-worn cameras.

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$7,718,000 in fiscal year 2022 and $6,767,000 in fiscal year 2023 are from the trunk highway fund for staff and equipment costs of additional patrol troopers.

(b) Commercial Vehicle Enforcement

10,180,000

10,046,000

$494,000 in fiscal year 2022 and $360,000 in fiscal year 2023 are for the purchase, deployment, and management of body-worn cameras.

20,610,000

16,667,000

This appropriation is from the general fund.

$449,000 in fiscal year 2022 and $395,000 in fiscal year 2023 are for the purchase, deployment, and management of body-worn cameras.

Up to $8,863,000 in fiscal year 2022 and $4,420,000 in fiscal year 2023 are available for staff and equipment costs of additional troopers and nonsworn officers.

The commissioner must 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 must not transfer any money appropriated to the commissioner under this section:

(1) to capitol security; or

(2) from capitol security.

(d) Vehicle Crimes Unit

888,000

884,000

This appropriation is from the highway user tax distribution fund to investigate:

(1) registration tax and motor vehicle sales tax liabilities from individuals and businesses that currently do not pay all taxes owed; and

(2) illegal or improper activity related to the sale, transfer, titling, and registration of motor vehicles.

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$22,000 in fiscal year 2022 and $18,000 in fiscal year 2023 are for the purchase, deployment, and management of body-worn cameras.

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

ARTICLE 2

TRUNK HIGHWAY BONDS

Section 1. BOND APPROPRIATIONS.

The sums shown in the column under "Appropriations" are appropriated from the bond proceeds account in the trunk highway fund to the state agencies or officials indicated to be spent for public purposes. Appropriations of bond proceeds must be spent as authorized by the Minnesota Constitution, articles XI and XIV. Unless otherwise specified, money appropriated in this article for a capital program or project may be used to pay state agency staff costs that are attributed directly to the capital program or project in accordance with accounting policies adopted by the commissioner of management and budget.

SUMMARY

Department of Transportation		$149,000,000
Department of Management and Budget		$149,000
TOTAL		$149,149,000

APPROPRIATIONS

Sec. 2. DEPARTMENT OF TRANSPORTATION

Subdivision 1. High-Priority Bridges

$80,000,000

(a) This appropriation is to the commissioner of transportation for land acquisition, environmental analysis, predesign, design, engineering, construction, reconstruction, and improvement of priority trunk highway bridges, including design-build contracts, internal department costs associated with delivering the construction program, consultant usage to support these activities, and costs of payments to landowners for lands acquired for highway rights-of-way. The commissioner must conform with the investment priorities identified in the Minnesota state highway investment plan under Minnesota Statutes, section 174.03, subdivision 1c.

(b) The commissioner may use up to 17 percent of the amount for program delivery.

Subd. 2. Facilities Capital Improvement Program

69,000,000

(a) This appropriation is to the commissioner of transportation for construction, renovation, and expansion of Department of Transportation buildings and facilities.

(b) The commissioner may use up to 17 percent of the amount for program delivery.

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Sec. 3. BOND SALE EXPENSES

$149,000

This appropriation is to the commissioner of management and budget for bond sale expenses under Minnesota Statutes, sections 16A.641, subdivision 8, and 167.50, subdivision 4.

Sec. 4. BOND SALE AUTHORIZATION.

To provide the money appropriated in this article from the bond proceeds account in the trunk highway fund, the commissioner of management and budget shall sell and issue bonds of the state in an amount up to $149,149,000 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 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. 5. Laws 2021, First Special Session chapter 5, article 2, section 2, subdivision 1, is amended to read:

Subdivision 1. Corridors of Commerce

$200,000,000

(a) This appropriation is to the commissioner of transportation for the corridors of commerce program under Minnesota Statutes, section 161.088.

(b) This appropriation is available in the amounts of:

(1) $100,000,000 in fiscal year 2024; and

(2) $100,000,000 in fiscal year 2025.

(c) For all available funds under paragraph (b), the commissioner must commence the project selection process under the program by ~~August 1, 2022~~ February 1, 2023.

(d) The commissioner may use up to 17 percent of the amount for program delivery.

(e) The appropriation in this subdivision cancels as specified under Minnesota Statutes, section 16A.642, except that the commissioner of management and budget must count the start of authorization for issuance of state bonds as the first day of the fiscal year during which the bonds are available to be issued as specified under paragraph (b), and not as the date of enactment of this section.

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

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ARTICLE 3

TRANSPORTATION FINANCE AND POLICY

Section 1. Minnesota Statutes 2020, section 4.075, is amended by adding a subdivision to read:

Subd. 4. Traffic Safety Advisory Council; established. The Traffic Safety Advisory Council is established to advise, consult with, coordinate, and make program recommendations to the commissioners of public safety, transportation, and health on the development and implementation of projects and programs intended to improve traffic safety on all Minnesota road systems. The advisory council serves as the lead for the state Toward Zero Deaths program.

Sec. 2. Minnesota Statutes 2020, section 4.075, is amended by adding a subdivision to read:

Subd. 5. Traffic Safety Advisory Council; membership. The advisory council consists of the following members:

(1) the chair, which is filled on a two-year rotating basis by:

(i) a designee from the Office of Traffic Safety in the Department of Public Safety;

(ii) a designee from the Office of Traffic Engineering in the Department of Transportation; and

(iii) a designee from the Injury and Violence Prevention Section in the Department of Health;

(2) two vice chairs, which must be filled by the two designees who are not currently serving as chair of the advisory council under clause (1);

(3) the director of the state Toward Zero Deaths program;

(4) the chief of the State Patrol or a designee;

(5) a regional coordinator from the Toward Zero Deaths program;

(6) the state traffic safety engineer in the Department of Transportation or a designee;

(7) a law enforcement liaison from the Department of Public Safety;

(8) a representative from the Department of Human Services;

(9) a representative from the Department of Education;

(10) a representative from the Council on Disability;

(11) a representative for Tribal governments appointed by the commissioner of public safety;

(12) a representative from the Center for Transportation Studies at the University of Minnesota;

(13) a representative from the Minnesota Chiefs of Police Association;

(14) a representative from the Minnesota Sheriffs' Association;

(15) a representative from the Minnesota Safety Council;

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(16) a representative from AAA Minnesota;

(17) a representative from the Minnesota Trucking Association;

(18) a representative from the Insurance Federation of Minnesota;

(19) a representative from the Association of Minnesota Counties;

(20) a representative from the League of Minnesota Cities;

(21) the American Bar Association State Judicial Outreach Liaison;

(22) a representative from the City Engineers Association of Minnesota;

(23) a representative from the Minnesota County Engineers Association;

(24) a representative from the Bicycle Alliance of Minnesota;

(25) an individual representing vulnerable road users, including pedestrians, bicyclists, and other operators of a personal conveyance, appointed by the Bicycle Alliance of Minnesota;

(26) a representative from Our Streets Minneapolis; and

(27) a representative from Minnesota Operation Lifesaver.

Sec. 3. Minnesota Statutes 2020, section 4.075, is amended by adding a subdivision to read:

Subd. 6. Traffic Safety Advisory Council; administration. (a) The Department of Public Safety Office of Traffic Safety, in cooperation with the Departments of Transportation and Health, must serve as the host agency for the advisory council and must manage the financial, administrative, and operational aspects of the advisory council's activities.

(b) The Traffic Safety Advisory Council must meet no less than four times per year or more frequently as determined by the chair, a majority of the council members, or any of the designated commissioners.

(c) The chair must regularly report to the respective commissioners on the activities of the advisory council and on the state of traffic safety in Minnesota.

(d) The terms, compensation, and appointment of members are governed by section 15.059.

(e) The advisory council may appoint subcommittees and working groups. Subcommittees must consist of council members. Working groups may include nonmembers. Nonmembers on working groups must be compensated pursuant to section 15.059, subdivision 3, only for expenses incurred for working group activities.

Sec. 4. Minnesota Statutes 2020, section 4.075, is amended by adding a subdivision to read:

Subd. 7. Traffic Safety Advisory Council; duties. The Traffic Safety Advisory Council must:

(1) advise the governor and heads of state departments and agencies on policy, programs, and services affecting traffic safety;

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(2) advise the director of the state Toward Zero Deaths program and state department representatives on the activities of the Toward Zero Deaths program, including informing and educating the public about traffic safety;

(3) encourage state departments and other agencies to conduct needed research in the field of traffic safety;

(4) review recommendations of the subcommittees and working groups; and

(5) review and comment on all grants dealing with traffic safety and on the development and implementation of state and local traffic safety plans.

Sec. 5. Minnesota Statutes 2020, section 4.075, is amended by adding a subdivision to read:

Subd. 8. Traffic safety report. Annually by January 2, the commissioner of public safety must provide a traffic safety report to the governor and the chairs and ranking minority members of the legislative committees with jurisdiction over traffic safety. The report must analyze the safety of Minnesota's roads and transportation system, including but not limited to:

(1) injuries and fatalities that occur on or near a roadway or transportation system facility;

(2) factors that caused crashes resulting in injuries and fatalities;

(3) roadway and system improvements broadly and at specific locations that could reduce injuries and fatalities;

(4) enforcement and education efforts that could reduce injuries and fatalities;

(5) other safety improvements, programs, or features that will improve the quality of the roadway and transportation use experience; and

(6) existing and needed resources to make roadway and transportation system safety improvements.

Sec. 6. Minnesota Statutes 2020, section 160.08, subdivision 7, is amended to read:

Subd. 7. No commercial establishment within right-of-way; exceptions. No commercial establishment, including but not limited to automotive service stations, for serving motor vehicle users shall be constructed or located within the right-of-way of, or on publicly owned or publicly leased land acquired or used for or in connection with, a controlled-access highway; except that:

(1) structures may be built within safety rest and travel information center areas;

(2) space within state-owned buildings in those areas may be leased for the purpose of providing information to travelers through advertising as provided in section 160.276;

(3) advertising signs may be erected within the right-of-way of interstate or controlled-access trunk highways by franchise agreements under section 160.80;

(4) vending machines may be placed in rest areas, travel information centers, or weigh stations constructed or located within trunk highway rights-of-way; ~~and~~

(5) acknowledgment signs may be erected under sections 160.272 and 160.2735.; and

(6) electric vehicle charging stations may be installed, operated, and maintained in safety rest areas.

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

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Sec. 7. [160.2325] HIGHWAYS FOR HABITAT PROGRAM.

Subdivision 1. Definitions. (a) For purposes of this section, the following terms have the meanings given.

(b) "Integrated roadside vegetation management" means an approach to right-of-way maintenance that combines a variety of techniques with sound ecological principles to establish and maintain safe, healthy, and functional roadsides. Integrated roadside vegetation management includes but is not limited to judicious use of herbicides, spot mowing, biological control, prescribed burning, mechanical tree and brush removal, erosion prevention and treatment, and prevention and treatment of other right-of-way disturbances.

Subd. 2. Program establishment. The commissioner must establish a highways for habitat program to enhance roadsides with pollinator and other wildlife habitat and vegetative buffers.

Subd. 3. General requirements. In implementing the program, the commissioner must:

(1) identify and prioritize highways for habitat installations under an integrated roadside vegetation management plan with priority given to new construction and reconstruction;

(2) develop and erect signage, where appropriate, that identifies highways for habitat projects and clearly marks the habitat and management restrictions;

(3) develop and require training for department personnel and contractors that apply pesticides and manage vegetation on the use of integrated roadside vegetation management and native plant identification;

(4) assess, in consultation with the commissioners of natural resources and agriculture, the categorization and management of noxious weeds to reduce the use of mowing and pesticides;

(5) maintain a website that includes information on program implementation, integrated roadside vegetation management, and related best management practices; and

(6) identify funding sources and develop proposals for ongoing funding for the program.

Subd. 4. Management standards. (a) The commissioner, in consultation with the commissioner of natural resources and the Board of Water and Soil Resources, must develop standards and best management practices for integrated roadside vegetation management plans under the program.

(b) The standards and best management practices must include:

(1) guidance on seed and vegetation selection based on the Board of Water and Soil Resources' native vegetation establishment and enhancement guidelines;

(2) requirements for roadside vegetation management protocols that avoid the use of pollinator lethal insecticides as defined under section 18H.02, subdivision 28a;

(3) practices that are designed to avoid habitat destruction and protect nesting birds, pollinators, and other wildlife; and

(4) identification of appropriate right-of-way tracts for wildflower and native habitat establishment.

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Sec. 8. Minnesota Statutes 2020, section 160.266, is amended by adding a subdivision to read:

Subd. 7. North Star Bikeway. The North Star Bikeway is designated as a state bicycle route. It must originate in the city of St. Paul in Ramsey County, then proceed north and east to Duluth in St. Louis County, then proceed north and east along the shore of Lake Superior through Grand Marais in Cook County to Minnesota's boundary with Canada, and there terminate.

Sec. 9. Minnesota Statutes 2020, section 161.088, subdivision 1, is amended to read:

Subdivision 1. Definitions. (a) For purposes of this section, the following terms have the meanings given:.

~~(1)~~ (b) "Beyond the project limits" means any point that is located:

~~(i)~~ (1) outside of the project limits;

~~(ii)~~ (2) along the same trunk highway; and

~~(iii)~~ (3) within the same region of the state;.

~~(2)~~ (c) "City" means a statutory or home rule charter city;.

(d) "Department" means the Department of Transportation.

~~(3)~~ (e) "Program" means the corridors of commerce program established in this section~~; and~~.

~~(4)~~ (f) "Project limits" means the estimated construction limits of a project for trunk highway construction, reconstruction, or maintenance, that is a candidate for selection under the corridors of commerce program.

(g) "Screening entity" means an area transportation partnership, the Metropolitan Council in consultation with the transportation advisory board under section 473.146, subdivision 4, or a specified county.

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

Sec. 10. Minnesota Statutes 2020, section 161.088, subdivision 2, is amended to read:

Subd. 2. Program authority; funding. (a) As provided in this section, the commissioner ~~shall~~ must establish a corridors of commerce program for trunk highway construction, reconstruction, and improvement, including maintenance operations, that improves commerce in the state.

(b) The commissioner may expend funds under the program from appropriations to the commissioner that are:

(1) made specifically by law for use under this section;

(2) at the discretion of the commissioner, made for the budget activities in the state roads program of operations and maintenance, program planning and delivery, or state road construction; and

(3) made for the corridor investment management strategy program, unless specified otherwise.

(d) The commissioner may use up to 17 percent of any appropriation ~~to the program~~ under this section for program delivery and for project scoring, ranking, and selection under subdivision 5.

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

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Sec. 11. Minnesota Statutes 2020, section 161.088, subdivision 4, is amended to read:

Subd. 4. Project eligibility. (a) The eligibility requirements for projects that can be funded under the program are:

(1) consistency with the statewide multimodal transportation plan under section 174.03;

(2) location of the project on ~~an interregional corridor~~ the national highway system, as provided under Code of Federal Regulations, title 23, part 470, and successor requirements, for a project located outside of the Department of Transportation metropolitan district;

(3) placement into at least one project classification under subdivision 3;

(4) project construction work will commence within ~~three~~ four years~~, or a longer length of time as determined by the commissioner~~; ~~and~~

(5) for each type of project classification under subdivision 3, a maximum allowable amount for the total project cost estimate, as determined by the commissioner with available data; and

(6) determination of a total project cost estimate with a reasonable degree of accuracy.

(b) A project whose construction is programmed in the state transportation improvement program is not eligible for funding under the program. This paragraph does not apply to a project that is programmed as result of selection under this section.

(c) A project may be, but is not required to be, identified in the 20-year state highway investment plan under section 174.03.

(d) For each project, the commissioner must consider all of the eligibility requirements under paragraph (a). The commissioner is prohibited from considering any eligibility requirement not specified under paragraph (a).

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

Sec. 12. Minnesota Statutes 2020, section 161.088, is amended by adding a subdivision to read:

Subd. 4a. Project funding; regional balance. (a) To ensure regional balance throughout the state, the commissioner must distribute all available funds under the program within the following funding categories:

(1) Metro Projects: at least 30 percent and no more than 35 percent of the funds are for projects that are located within, on, or directly adjacent to an area bounded by marked Interstate Highways 494 and 694;

(2) Metro Connector Projects: at least 30 percent and no more than 35 percent of the funds are for projects that:

(i) are not included in clause (1); and

(ii) are located within the department's metropolitan district or within 40 miles of marked Interstate Highway 494 or marked Interstate Highway 694; and

(3) Regional Center Projects: at least 30 percent of the funds are for projects that are not included in clause (1) or (2).

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(b) The commissioner must calculate the percentages under paragraph (a) using total funds under the program for (1) the current project selection round, and (2) to the extent applicable, the two most recent prior selection rounds performed on or after the effective date of this section.

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

Sec. 13. Minnesota Statutes 2021 Supplement, section 161.088, subdivision 5, is amended to read:

Subd. 5. Project selection process; criteria. (a) The commissioner must establish a process to identify, evaluate, and select projects under the program. The process must be consistent with the requirements of this subdivision and must not include any additional ~~evaluation~~ scoring criteria. The process must include phases as provided in this subdivision.

(b) As part of the project selection process, the commissioner must annually accept recommendations on candidate projects from area transportation partnerships and other interested stakeholders in each Department of Transportation district. The commissioner must determine the eligibility for each candidate project identified under this paragraph. For each eligible project, the commissioner must classify and evaluate the project for the program, using all of the criteria established under paragraph (c). Phase 1: Project solicitation. Following enactment of each law that makes additional funds available for the program, the commissioner must undertake a public solicitation of potential projects for consideration. The solicitation must be performed through an Internet recommendation process that allows for an interested party, including an individual, business, local unit of government, corridor group, or interest group, to submit a project for consideration.

(c) Phase 2: Local screening and recommendations. The commissioner must present the projects submitted during the open solicitation under Phase 1 to the appropriate screening entity where each project is located. A screening entity must:

(1) consider all of the submitted projects for its area;

(2) solicit input from members of the legislature who represent the area for project review and nonbinding approval or disapproval; and

(3) recommend projects to the commissioner for formal scoring, as provided in Phase 3.

(d) Each screening entity may recommend up to three projects to the commissioner, except that (1) the Metropolitan Council may recommend up to four projects, and (2) Anoka, Carver, Chisago, Dakota, Hennepin, Ramsey, Scott, and Washington Counties may each independently recommend up to two projects. A screening entity may recommend a replacement project for a project that the commissioner determines is ineligible under subdivision 4. Each recommendation must identify any approvals or disapprovals provided by a member of the legislature.

(e) Phase 3: Project scoring. The commissioner must confirm project eligibility under subdivision 4 and perform a complete scoring assessment on each of the eligible projects recommended by the screening entities under Phase 2.

(f) Projects must be ~~evaluated~~ scored using all of the following criteria:

(1) a return on investment measure that provides for comparison across eligible projects;

(2) measurable impacts on commerce and economic competitiveness;

(3) efficiency in the movement of freight, including but not limited to:

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(i) measures of annual average daily traffic and commercial vehicle miles traveled, which may include data near the project location on that trunk highway or on connecting trunk and local highways; and

(ii) measures of congestion or travel time reliability, which may be within or near the project limits, or both;

(4) improvements to traffic safety;

(5) connections to regional trade centers, local highway systems, and other transportation modes;

(6) the extent to which the project addresses multiple transportation system policy objectives and principles;

(7) support and consensus for the project among members of the surrounding community; and

(8) the time and work needed before construction may begin on the project~~; and~~.

~~(9) regional balance throughout the state.~~

The commissioner must give the criteria in clauses (1) to (8) equal weight in the ~~selection~~ scoring process.

(g) Phase 4: Project ranking and selection. Upon completion of project scoring under Phase 3, the commissioner must develop a ranked list of projects based on total score and must select projects in rank order for funding under the program, subject to subdivision 4a. The commissioner must specify the amounts and known or anticipated sources of funding for each selected project.

~~(d) The list of all projects evaluated must be made public and must include the score of each project.~~

(h) Phase 5: Public information. The commissioner must publish information regarding the selection process on the department's website. The information must include:

(1) lists of all projects submitted for consideration and all projects recommended by the screening entities;

(2) the scores and ranking for each project; and

(3) an overview of each selected project, including amounts and sources of funding.

(e) As part of the project selection process, the commissioner may divide funding to be separately available among projects within each classification under subdivision 3, and may apply separate or modified criteria among those projects falling within each classification.

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

Sec. 14. Minnesota Statutes 2020, section 161.115, is amended by adding a subdivision to read:

Subd. 271. Route No. 340. Beginning at a point in or adjacent to Upper Sioux Agency State Park; thence extending in a general northwesterly direction to a point on Route No. 67 at or near Granite Falls.

Sec. 15. Minnesota Statutes 2020, section 161.14, is amended by adding a subdivision to read:

Subd. 102. John Schlegel Memorial Highway. The segment of marked U.S. Highway 71 from Willmar to the intersection with marked Trunk Highway 7 in Kandiyohi County is designated as "John Schlegel Memorial Highway." Subject to section 161.139, the commissioner must adopt a suitable design to mark this highway and erect appropriate signs.

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Sec. 16. Minnesota Statutes 2020, section 161.14, is amended by adding a subdivision to read:

Subd. 103. Prince Rogers Nelson Memorial Highway. The segment of marked Trunk Highway 5 within the city limits of Chanhassen is designated "Prince Rogers Nelson Memorial Highway." The commissioner must adopt a suitable design to mark this highway that conforms to the Manual on Uniform Traffic Control Devices adopted by the commissioner under section 169.06, except that to the extent feasible, the sign must include the symbol associated with the artist and be purple in color. Subject to section 161.139, the commissioner must erect appropriate signs.

Sec. 17. [161.369] INDIAN EMPLOYMENT PREFERENCE.

As authorized by United States Code, title 23, section 104, paragraph (d), the commissioner may implement an Indian employment preference for members of federally recognized Tribes on projects carried out under United States Code, title 23, on or near an Indian reservation. For purposes of this section, a project is near an Indian reservation if the project is within the distance a person seeking employment could reasonably be expected to commute to and from each workday. The commissioner, in consultation with federally recognized Minnesota Tribes, may determine when a project is near an Indian reservation.

Sec. 18. Minnesota Statutes 2020, section 162.07, subdivision 2, is amended to read:

Subd. 2. Money needs defined. For the purpose of this section, money needs of each county are defined as the estimated total annual costs of constructing, over a period of 25 years, the county state-aid highway system in located and established by that county. Costs incidental to construction, or a specified portion thereof as set forth in the commissioner's rules may be included in determining money needs. To avoid variances in costs due to differences in construction policy, construction costs shall be estimated on the basis of the engineering standards developed cooperatively by the commissioner and the county engineers of the several counties.

Sec. 19. Minnesota Statutes 2020, section 162.13, subdivision 2, is amended to read:

Subd. 2. Money needs defined. For the purpose of this section money needs of each city having a population of 5,000 or more are defined as the estimated cost of constructing and maintaining over a period of 25 years the municipal state-aid street system in located and established by such city. Right-of-way costs and drainage shall be included in money needs. Lighting costs and other costs incidental to construction and maintenance, or a specified portion of such costs, as set forth in the commissioner's rules, may be included in determining money needs. To avoid variances in costs due to differences in construction and maintenance policy, construction and maintenance costs shall be estimated on the basis of the engineering standards developed cooperatively by the commissioner and the engineers, or a committee thereof, of the cities.

Sec. 20. Minnesota Statutes 2020, section 162.13, subdivision 3, is amended to read:

Subd. 3. Screening board. On or before September 1 of each year, the engineer of each city having a population of 5,000 or more ~~shall~~ must update their data and forward to the commissioner ~~on forms prepared by the commissioner,~~ all information relating to the money needs of the city that the commissioner deems necessary in order to apportion the municipal state-aid street fund in accordance with the apportionment formula ~~heretofore set forth~~. Upon receipt of the information the commissioner ~~shall~~ must appoint a board of city engineers. The board ~~shall~~ must be composed of ~~one engineer from each state highway construction district, and in addition thereto,~~: (1) two city engineers from the metropolitan district; (2) one city engineer from each nonmetropolitan district; and (3) one engineer from each city of the first class. The board ~~shall~~ must investigate and review the information submitted by each city. On or before November 1 of each year, the board ~~shall~~ must submit its findings and recommendations in writing as to each city's money needs to the commissioner on a form prepared by the commissioner. Final determination of the money needs of each city ~~shall~~ must be made by the commissioner. In the

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event that any city ~~shall fail~~ fails to submit the required information ~~provided for herein~~, the commissioner ~~shall~~ must estimate the money needs of the city. The estimate ~~shall~~ must be used in solving the apportionment formula. The commissioner may withhold payment of the amount apportioned to the city until the information is submitted.

Sec. 21. Minnesota Statutes 2020, section 168.1235, subdivision 1, is amended to read:

Subdivision 1. General requirements; fees. (a) The commissioner shall issue a special plate emblem for each plate to an applicant who:

(1) is a member of a congressionally chartered veterans service organization and is a registered owner of a passenger automobile, pickup truck, van, or self-propelled recreational vehicle;

(2) pays the registration tax required by law;

(3) pays a fee in the amount specified for special plates under section 168.12, subdivision 5, for each set of two plates, and any other fees required by this chapter; and

(4) complies with this chapter and rules governing the registration of motor vehicles and licensing of drivers.

(b) The additional fee is payable at the time of initial application for the special plate emblem and when the plates must be replaced or renewed. An applicant must not be issued more than two sets of special plate emblems for motor vehicles listed in paragraph (a) and registered to the applicant.

(c) The applicant must present a valid card indicating membership in the American Legion or, Veterans of Foreign Wars, or Disabled American Veterans.

Sec. 22. Minnesota Statutes 2020, section 168.1253, subdivision 3, is amended to read:

Subd. 3. No fee. The commissioner shall issue a set of Gold Star plates, or a single plate for a motorcycle, to an eligible person free of charge, and shall replace the plate or plates without charge if they become damaged. If the eligible person requests personalized Gold Star plates, the commissioner must not charge the fees listed in section 168.12, subdivision 2a.

Sec. 23. Minnesota Statutes 2020, section 168.27, subdivision 11, is amended to read:

Subd. 11. Dealers' licenses; location change notice; fee. (a) Application for a dealer's license or notification of a change of location of the place of business on a dealer's license must include a street address, not a post office box, and is subject to the commissioner's approval.

(b) Upon the filing of an application for a dealer's license and the proper fee, unless the application on its face appears to be invalid, the commissioner shall grant a 90-day temporary license. During the 90-day period following issuance of the temporary license, the commissioner shall inspect the place of business site and insure compliance with this section and rules adopted under this section.

(c) The commissioner may extend the temporary license 30 days to allow the temporarily licensed dealer to come into full compliance with this section and rules adopted under this section.

(d) In no more than 120 days following issuance of the temporary license, the dealer license must either be granted or denied.

(e) A license must be denied under the following conditions:

(1) ~~The license must be denied~~ if within the previous ten years the applicant was enjoined due to a violation of section 325F.69 or convicted of violating section 325E.14, 325E.15, 325E.16, or 325F.69, or convicted under section 609.53 of receiving or selling stolen vehicles, or convicted of violating United States Code, title ~~15, sections~~

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~~1981 to 1991~~ 49, sections 32701 to 32711, or pleaded guilty, entered a plea of nolo contendere or no contest, or has been found guilty in a court of competent jurisdiction of any charge of failure to pay state or federal income or sales taxes or felony charge of forgery, embezzlement, obtaining money under false pretenses, theft by swindle, extortion, conspiracy to defraud, or bribery.;

(2) ~~A license must be denied~~ if the applicant has had a dealer license revoked within the previous ten years.; or

(3) if, at the time of inspection, the applicant is not in compliance with location requirements or has intentionally or negligently misrepresented any information on the application that would be grounds for suspension or revocation under subdivision 12.

(f) If the application is approved, the commissioner shall license the applicant as a dealer for one year from the date the temporary license is granted and issue a certificate of license that must include a distinguishing number of identification of the dealer. The license must be displayed in a prominent place in the dealer's licensed place of business.

(g) Each initial application for a license must be accompanied by a fee of $100 in addition to the annual fee. The annual fee is $150. The initial fees and annual fees must be paid into the state treasury and credited to the general fund except that $50 of each initial and annual fee must be paid into the vehicle services operating account in the special revenue fund under section 299A.705.

Sec. 24. Minnesota Statutes 2020, section 168A.11, subdivision 3, is amended to read:

Subd. 3. Records. Every dealer shall maintain for three years at an established place of business a record in the form the department prescribes of every vehicle bought, sold, or exchanged, or received for sale or exchange, which shall be open to inspection by a representative of the department or peace officer during ~~reasonable business hours~~ inspection hours as listed on the initial dealer license application or as noted on the dealer record. With respect to motor vehicles subject to the provisions of section 325E.15, the record shall include either the true mileage as stated by the previous owner or the fact that the previous owner stated the actual cumulative mileage was unknown; the record also shall include either the true mileage the dealer stated upon transferring the vehicle or the fact the dealer stated the mileage was unknown.

Sec. 25. Minnesota Statutes 2020, section 168B.07, subdivision 3, is amended to read:

Subd. 3. Retrieval of contents; right to reclaim. (a) For purposes of this subdivision:

(1) "contents" does not include any permanently affixed mechanical or nonmechanical automobile parts; automobile body parts; or automobile accessories, including audio or video players; and

(2) "relief based on need" includes, but is not limited to, receipt of MFIP and Diversionary Work Program, medical assistance, general assistance, emergency general assistance, Minnesota supplemental aid, MSA-emergency assistance, MinnesotaCare, Supplemental Security Income, energy assistance, emergency assistance, Supplemental Nutrition Assistance Program (SNAP) benefits, earned income tax credit, or Minnesota working family tax credit.

(b) A unit of government or impound lot operator ~~shall~~ must establish reasonable procedures for retrieval of vehicle contents, and may establish reasonable procedures to protect the safety and security of the impound lot and its personnel.

(c) At any time before the expiration of the waiting periods provided in section 168B.051, a registered owner of a vehicle who provides proof of identity that includes photographic identification and documentation from a government or nonprofit agency or legal aid office that the registered owner is homeless, receives relief based on

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need, or is eligible for legal aid services, has the unencumbered right to retrieve any and all contents without charge and regardless of whether the registered owner pays incurred charges or fees, transfers title, or reclaims the vehicle. A refusal by the impound lot operator to allow the registered owner to retrieve the vehicle contents after the owner provides valid documentation is a violation of this paragraph.

(d) An impound lot operator may make copies of the documents presented by the registered owner under paragraph (c), and the impound lot operator must return all of the original documents to the registered owner immediately after copying them.

Sec. 26. Minnesota Statutes 2020, section 168B.07, is amended by adding a subdivision to read:

Subd. 3a. Retrieval of contents; identification, medicine, and medical equipment. An impound lot operator must allow any registered vehicle owner to retrieve, or must retrieve for the vehicle owner, proof of identification, prescription medicine, and durable medical equipment, including wheelchairs, prosthetics, canes, crutches, walkers, and external braces, from the impounded vehicle.

Sec. 27. Minnesota Statutes 2020, section 168B.07, is amended by adding a subdivision to read:

Subd. 3b. Retrieval of contents; notice of denial. (a) This subdivision applies to an impound lot operator who operates a nonpublic impound lot or who exclusively contracts with a unit of government under section 168B.09 to operate a public impound lot solely for public use.

(b) An impound lot operator who denies a request of a registered vehicle owner to retrieve vehicle contents after the registered owner presents documentation pursuant to subdivision 3, paragraph (c), must, at the time of denial, provide the registered owner with a written statement that identifies the specific reasons for the denial.

Sec. 28. Minnesota Statutes 2020, section 168B.07, is amended by adding a subdivision to read:

Subd. 3c. Retrieval of contents; public notice. (a) This subdivision applies to an impound lot operator who operates a nonpublic impound lot or who exclusively contracts with a unit of government under section 168B.09 to operate a public impound lot solely for public use.

(b) An impound lot operator must post a conspicuous notice at its place of operation in the following form:

"If you receive government benefits, are currently homeless, or are eligible for legal aid services, you have the right to get the contents out of your car free of charge IF you give us:

(1) a photo ID (such as a driver's license, passport, or employer ID); AND

(2) documentation from a government or nonprofit agency or from a legal aid office that you get benefits from a government program based on your income; you are homeless; or you are eligible for legal aid services. Examples of this documentation include BUT ARE NOT LIMITED TO:

- an EBT card;

- a Medical Assistance or MinnesotaCare card;

- a Supplemental Nutrition Assistance Program (SNAP) card; and

- a letter, email, or other document from a government agency, a nonprofit organization, or a legal aid organization showing that you get benefits from a government program based on your income, you are homeless, or you are eligible for legal aid services."

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Sec. 29. Minnesota Statutes 2020, section 168B.07, is amended by adding a subdivision to read:

Subd. 3d. Retrieval of contents; remedy. (a) An aggrieved registered vehicle owner has a cause of action as provided in this subdivision against an impound lot operator who operates a nonpublic impound lot or who exclusively contracts with a unit of government under section 168B.09 to operate a public impound lot solely for public use if the impound lot operator denies the registered owner the right to retrieve the vehicle contents in violation of subdivision 3, paragraph (c).

(b) If the vehicle and its contents remain in the possession of the impound lot operator and retrieval of the vehicle contents was denied in violation of subdivision 3, paragraph (c), an aggrieved registered vehicle owner is entitled to injunctive relief to retrieve the vehicle contents as well as reasonable attorney fees and costs.

(c) If an impound lot operator sells or disposes of the vehicle contents after the registered owner has provided the documentation required under subdivision 3, paragraph (c), an aggrieved registered vehicle owner is entitled to statutory damages in an amount of $1,000 and reasonable attorney fees and costs. An action brought pursuant to this paragraph must be brought within 12 months of when the vehicle was impounded.

Sec. 30. Minnesota Statutes 2020, section 169.14, is amended by adding a subdivision to read:

Subd. 5i. Certain speed limits in Ramsey County. (a) For purposes of this subdivision, "suburban residential roadway" means a county highway that is (1) in an area zoned exclusively for housing, or (2) adjacent to a city, county, or regional park.

(b) Ramsey County may establish a speed limit of 30 miles per hour on a suburban residential roadway under its jurisdiction, without conducting an engineering and traffic investigation.

(c) A speed limit under paragraph (b) is effective once the county erects signs designating the speed limit and indicating the beginning and end of the suburban residential roadway on which the speed limit applies.

Sec. 31. Minnesota Statutes 2020, section 169.18, subdivision 3, is amended to read:

Subd. 3. Passing. ~~The following rules shall govern the overtaking and passing of vehicles proceeding in the same direction, subject to the limitations, exceptions, and special rules hereinafter stated:~~

~~(1)~~ (a) The driver of a vehicle overtaking another vehicle proceeding in the same direction ~~shall~~ must pass to the left ~~thereof~~ of the other vehicle at a safe distance and ~~shall not again drive~~ is prohibited from returning to the right side of the roadway until safely clear of the overtaken vehicle;.

~~(2)~~ (b) Except when overtaking and passing on the right is permitted, the driver of an overtaken vehicle ~~shall~~ must give way to the right in favor of the overtaking vehicle ~~on audible warning,~~ and ~~shall~~ must not increase ~~the~~ speed ~~of the overtaken vehicle~~ until completely passed by the overtaking vehicle~~; and~~.

~~(3)~~ (c) The operator of a motor vehicle overtaking a bicycle or individual proceeding in the same direction on the roadway ~~shall leave~~ or shoulder must:

(1) either:

(i) maintain a safe clearance distance while passing, ~~but in no case less than~~ which must be at least the greater of three feet ~~clearance, when passing the bicycle or individual~~ or one-half the width of the motor vehicle; or

(ii) completely enter another lane of the roadway while passing; and ~~shall~~

(2) maintain clearance until the motor vehicle has safely ~~past~~ passed the overtaken bicycle or individual.

EFFECTIVE DATE. This section is effective August 1, 2022.

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Sec. 32. Minnesota Statutes 2021 Supplement, section 169.222, subdivision 4, is amended to read:

Subd. 4. Riding rules. (a) Every person operating a bicycle ~~upon a roadway shall~~ on a road must ride as close ~~as practicable~~ to the right-hand curb or edge of the ~~roadway except under any of the following situations~~ road as the bicycle operator determines is safe. A person operating a bicycle is not required to ride as close to the right-hand curb or edge when:

(1) ~~when~~ overtaking and passing another vehicle proceeding in the same direction;

(2) ~~when~~ preparing for a left turn at an intersection or into a private road or driveway;

(3) ~~when~~ reasonably necessary to avoid conditions that make it unsafe to continue along the right-hand curb or edge, including fixed or moving objects, vehicles, pedestrians, animals, surface hazards, or ~~narrow width~~ narrow‑width lanes~~, that make it unsafe to continue along the right-hand curb or edge; or~~;

(4) ~~when~~ operating on the shoulder of a roadway or in a bicycle lane.; or

(5) operating in a right-hand turn lane before entering an intersection.

(b) If a bicycle is traveling on a shoulder of a roadway, the bicycle ~~shall~~ operator must travel in the same direction as adjacent vehicular traffic.

(c) Persons riding bicycles upon a roadway or shoulder ~~shall~~ must not ride more than two abreast and ~~shall not impede the normal and reasonable movement of traffic and~~, on a laned roadway, ~~shall~~ must ride within a single lane.

(d) A person operating a bicycle upon a sidewalk, or across a roadway or shoulder on a crosswalk, ~~shall~~ must yield the right-of-way to any pedestrian and ~~shall~~ give an audible signal when necessary before overtaking and passing any pedestrian. No A person ~~shall~~ must not ride a bicycle upon a sidewalk within a business district unless permitted by local authorities. Local authorities may prohibit the operation of bicycles on any sidewalk or crosswalk under their jurisdiction.

(e) An individual operating a bicycle or other vehicle on a bikeway ~~shall~~ must (1) give an audible signal a safe distance before overtaking a bicycle or individual, (2) leave a safe clearance distance when overtaking a bicycle or individual proceeding in the same direction ~~on the bikeway~~, and ~~shall~~ (3) maintain clearance until safely past the overtaken bicycle or individual.

(f) Notwithstanding section 169.06, subdivision 4, a bicycle operator may cross an intersection proceeding from the leftmost one-third of a dedicated right-hand turn lane without turning right.

Sec. 33. [169.4476] EMERGENCY RESPONSE SCHOOL BUS USE.

Subdivision 1. Emergency school bus use authority. A school bus, when operated by a school district or by an operator under an agreement with a school district, may be used to assist in the response to an emergency or disaster as defined in section 12.03 for the purpose of evacuating a region or community.

Subd. 2. Requirements. (a) A school district or operator may operate a school bus under this section if:

(1) an emergency or disaster has been declared by the chief fire or law enforcement officer overseeing the response;

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(2) immediate emergency evacuation or relocation is required to remove individuals from an imminent threat to health or safety; and

(3) the transportation of individuals takes place only within the state of Minnesota.

(b) Nothing in this section exempts the school bus driver from the licensing requirements under section 171.02.

Subd. 3. Registration exemption. A school bus operated under this section and displaying registration in accordance with section 168.012, subdivision 1, paragraph (a), clause (2), or 168.013, subdivision 18, may be operated without reregistration of the bus, issuance of new plates, or payment of additional taxes and fees, as may be required under chapter 168.

Subd. 4. Annual inspection requirement. For purposes of this section, a school bus displaying a current inspection certificate issued in accordance with section 169.451, subdivision 2, is exempt from the inspection requirements under section 169.781, subdivision 2.

Subd. 5. School bus equipment. (a) Notwithstanding section 169.441, subdivision 3, paragraph (b), or 169.448, subdivision 1, a school bus operated under this section may be:

(1) painted national school bus glossy yellow; and

(2) equipped with school bus-related equipment and printing.

(b) A school bus operated under this section is prohibited from using the equipment required under section 169.442.

Sec. 34. Minnesota Statutes 2020, section 169.8261, is amended to read:

169.8261 ~~GROSS WEIGHT LIMITATIONS;~~ FOREST PRODUCTS SPECIAL PERMIT.

Subdivision 1. ~~Exemption~~ Definition. ~~(a)~~ For purposes of this section, "raw or unfinished forest products" include wood chips, paper, pulp, oriented strand board, laminated strand lumber, hardboard, treated lumber, untreated lumber, or barrel staves.

(b) In compliance with this section, a person may operate a vehicle or combination of vehicles to haul raw or unfinished forest products by the most direct route to the nearest paved highway on any highway with gross weights permitted under sections 169.823 to 169.829.

Subd. 1a. Six-axle vehicle permit. (a) A road authority may issue an annual permit authorizing a vehicle or combination of vehicles with a total of six or more axles to haul raw or unfinished forest products by the most direct route to the nearest paved highway on any highway with gross weights permitted under sections 169.823 to 169.829 and be operated with a gross vehicle weight of up to:

(1) 90,000 pounds; and

(2) 99,000 pounds during the period set by the commissioner under section 169.826, subdivision 1.

(b) A vehicle or combination of vehicles with a permit under this subdivision must not be operated on an interstate highway, except as provided under United States Code, title 23, section 127(q), for operation on the specified segment of marked Interstate Highway 35.

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Subd. 1b. Six-axle and over-width vehicle permit. (a) A road authority may issue an annual permit authorizing a vehicle or combination of vehicles with a total of six or more axles to haul raw or unfinished forest products by the most direct route to the nearest paved highway on any highway with gross weights permitted under sections 169.823 to 169.829 and be operated with:

(1) a gross vehicle weight of up to:

(i) 90,000 pounds; and

(ii) 99,000 pounds during the period set by the commissioner under section 169.826, subdivision 1; and

(2) a total outside width of the vehicle or the load that does not exceed 114 inches.

(b) In addition to the conditions in subdivision 2, a vehicle or combination of vehicles operated with a permit under this subdivision must:

(1) display red or orange flags, 18 inches square, as markers at the front and rear and on both sides of the load; and

(2) not be operated on any road in a metropolitan county, as defined in section 473.121, subdivision 4.

(c) A vehicle or combination of vehicles with a permit under this subdivision may only be operated on an interstate highway:

(1) as provided under United States Code, title 23, section 127(q), for operation on the specified segment of marked Interstate Highway 35; or

(2) if the gross vehicle weight does not exceed 80,000 pounds.

Subd. 2. Conditions. (a) A vehicle or combination of vehicles ~~described in subdivision 1~~ operated under this section must:

(1) comply with seasonal load restrictions in effect between the dates set by the commissioner under section 169.87, subdivision 2;

(2) comply with bridge load limits posted under section 169.84;

(3) be equipped and operated with six or more axles and brakes on all wheels;

~~(4) not exceed 90,000 pounds gross vehicle weight, or 99,000 pounds gross vehicle weight during the time when seasonal increases are authorized under section 169.826;~~

~~(5) not be operated on interstate highways;~~

~~(6) obtain an annual permit from the commissioner of transportation;~~

(4) be operated under a permit issued by each road authority having jurisdiction over a road on which the vehicle is operated if required;

~~(7)~~ (5) obey all road and bridge postings, including those pertaining to lane or roadway width; and

~~(8)~~ (6) not exceed 20,000 pounds gross weight on any single axle.

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(b) A vehicle operated under this section may exceed the legal axle weight limits listed in section 169.824 by not more than 12.5 percent; except that, the weight limits may be exceeded by not more than 23.75 percent during the time when seasonal increases are authorized under section 169.826, subdivision 1.

(c) Notwithstanding paragraph (a), clause (5), a vehicle or combination of vehicles hauling raw or unfinished forest products may operate on the segment of marked Interstate Highway 35 provided under United States Code, title 23, section 127(q)(2)(D).

Subd. 3. Expiration date. Upon request of the permit applicant, the expiration date for a permit issued under this section must be the same as the expiration date of the permitted vehicle's registration.

EFFECTIVE DATE. This section is effective August 1, 2022.

Sec. 35. Minnesota Statutes 2021 Supplement, section 169A.60, subdivision 13, is amended to read:

Subd. 13. Special registration plates. (a) At any time during the effective period of an impoundment order, a violator or registered owner may apply to the commissioner for new registration plates, which must bear a special series of numbers or letters so as to be readily identified by traffic law enforcement officers. ~~The commissioner may authorize the issuance of special plates if:~~

~~(1) the violator has a qualified licensed driver whom the violator must identify;~~

~~(2) the violator or registered owner has a limited license issued under section 171.30;~~

~~(3) the registered owner is not the violator and the registered owner has a valid or limited driver's license;~~

~~(4) a member of the registered owner's household has a valid driver's license; or~~

~~(5) the violator has been reissued a valid driver's license.~~

(b) The commissioner may not issue new registration plates for that vehicle subject to plate impoundment for a period of at least one year from the date of the impoundment order. In addition, if the owner is the violator, new registration plates may not be issued for the vehicle unless the person has been reissued a valid driver's license in accordance with chapter 171.

(c) A violator may not apply for new registration plates for a vehicle at any time before the person's driver's license is reinstated.

(d) The commissioner may issue the special plates on payment of a $50 fee for each vehicle for which special plates are requested, except that a person who paid the fee required under paragraph (f) must not be required to pay an additional fee if the commissioner issued an impoundment order pursuant to paragraph (g).

(e) Paragraphs (a) to (d) notwithstanding, the commissioner must issue upon request new registration plates for any vehicle owned by a violator or registered owner for which the registration plates have been impounded if:

(1) the impoundment order is rescinded;

(2) the vehicle is transferred in compliance with subdivision 14; or

(3) the vehicle is transferred to a Minnesota automobile dealer licensed under section 168.27, a financial institution that has submitted a repossession affidavit, or a government agency.

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(f) Notwithstanding paragraphs (a) to (d), the commissioner, upon request and payment of a $100 fee for each vehicle for which special plates are requested, must issue new registration plates for any vehicle owned by a violator or registered owner for which the registration plates have been impounded if the violator becomes a program participant in the ignition interlock program under section 171.306. This paragraph does not apply if the registration plates have been impounded pursuant to paragraph (g).

(g) The commissioner shall issue a registration plate impoundment order for new registration plates issued pursuant to paragraph (f) if, before a program participant in the ignition interlock program under section 171.306 has been restored to full driving privileges, the program participant:

(1) either voluntarily or involuntarily ceases to participate in the program for more than 30 days; or

(2) fails to successfully complete the program as required by the Department of Public Safety due to:

(i) two or more occasions of the participant's driving privileges being withdrawn for violating the terms of the program, unless the withdrawal is determined to be caused by an error of the department or the interlock provider; or

(ii) violating the terms of the contract with the provider as determined by the provider.

Sec. 36. Minnesota Statutes 2021 Supplement, section 171.0605, subdivision 5, is amended to read:

Subd. 5. Evidence; residence in Minnesota. (a) Submission of two forms of documentation from the following is satisfactory evidence of an applicant's principal residence address in Minnesota under section 171.06, subdivision 3, paragraph (b):

(1) a home utility services bill issued no more than 12 months before the application;

(2) a home utility services hook-up work order issued no more than 12 months before the application;

(3) United States bank or financial information issued no more than 12 months before the application, with account numbers redacted, including:

(i) a bank account statement;

(ii) a credit card or debit card statement;

(iii) a brokerage account statement; or

(iv) a money market account statement;

(4) a certified transcript from a United States high school, if issued no more than 180 days before the application;

(5) a certified transcript from a Minnesota college or university, if issued no more than 180 days before the application;

(6) an employment pay stub issued no more than 12 months before the application that lists the employer's name and address;

(7) a Minnesota unemployment insurance benefit statement issued no more than 12 months before the application;

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(8) a statement from an assisted living facility licensed under chapter 144G, nursing home licensed under chapter 144A, or a boarding care facility licensed under sections 144.50 to 144.56, that was issued no more than 12 months before the application;

(9) a current policy or card for health, automobile, homeowner's, or renter's insurance;

(10) a federal or state income tax return for the most recent tax filing year;

(11) a Minnesota property tax statement for the current or prior calendar year or a proposed Minnesota property tax notice for the current year that shows the applicant's principal residential address both on the mailing portion and the portion stating what property is being taxed;

(12) a Minnesota vehicle certificate of title;

(13) a filed property deed or title for current residence;

(14) a Supplemental Security Income award statement issued no more than 12 months before the application;

(15) mortgage documents for the applicant's principal residence;

(16) a residential lease agreement for the applicant's principal residence issued no more than 12 months before the application;

(17) a valid driver's license, including an instruction permit, issued under this chapter;

(18) a valid Minnesota identification card;

(19) an unexpired Minnesota professional license;

(20) an unexpired Selective Service card;

(21) military orders that are still in effect at the time of application;

(22) a cellular phone bill issued no more than 12 months before the application; or

(23) a valid license issued pursuant to the game and fish laws.

(b) In lieu of one of the two documents required by paragraph (a), an applicant under the age of 18 may use a parent or guardian's proof of principal residence as provided in this paragraph. The parent or guardian of the applicant must provide a document listed under paragraph (a) that includes the parent or guardian's name and the same address as the address on the document provided by the applicant. The parent or guardian must also certify that the applicant is the child of the parent or guardian and lives at that address.

(d) For purposes of this section and Minnesota Rules, part 7410.0410, Internet service is a home utility service.

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Sec. 37. Minnesota Statutes 2021 Supplement, section 171.306, subdivision 4, is amended to read:

Subd. 4. Issuance of restricted license. (a) The commissioner shall issue a class D driver's license, subject to the applicable limitations and restrictions of this section, to a program participant who meets the requirements of this section and the program guidelines. The commissioner shall not issue a license unless the program participant has provided satisfactory proof that:

(1) a certified ignition interlock device has been installed on the participant's motor vehicle at an installation service center designated by the device's manufacturer; and

(2) the participant has insurance coverage on the vehicle equipped with the ignition interlock device. If the participant has previously been convicted of violating section 169.791, 169.793, or 169.797 or the participant's license has previously been ~~suspended~~ revoked or canceled under section 169.792 or 169.797, the commissioner shall require the participant to present an insurance identification card that is certified by the insurance company to be noncancelable for a period not to exceed 12 months.

(b) A license issued under authority of this section must contain a restriction prohibiting the program participant from driving, operating, or being in physical control of any motor vehicle not equipped with a functioning ignition interlock device certified by the commissioner. A participant may drive an employer-owned vehicle not equipped with an interlock device while in the normal course and scope of employment duties pursuant to the program guidelines established by the commissioner and with the employer's written consent.

(c) A program participant whose driver's license has been: (1) revoked under section 169A.52, subdivision 3, paragraph (a), clause (1), (2), or (3), or subdivision 4, paragraph (a), clause (1), (2), or (3); 169A.54, subdivision 1, clause (1), (2), (3), or (4); or 171.177, subdivision 4, paragraph (a), clause (1), (2), or (3), or subdivision 5, paragraph (a), clause (1), (2), or (3); or (2) revoked under section 171.17, subdivision 1, paragraph (a), clause (1), or suspended under section 171.187, for a violation of section 609.2113, subdivision 1, clause (2), item (i) or (iii), (3), or (4); subdivision 2, clause (2), item (i) or (iii), (3), or (4); or subdivision 3, clause (2), item (i) or (iii), (3), or (4); or 609.2114, subdivision 2, clause (2), item (i) or (iii), (3), or (4), resulting in bodily harm, substantial bodily harm, or great bodily harm, where the participant has fewer than two qualified prior impaired driving incidents within the past ten years or fewer than three qualified prior impaired driving incidents ever; may apply for conditional reinstatement of the driver's license, subject to the ignition interlock restriction.

(d) A program participant whose driver's license has been: (1) revoked, canceled, or denied under section 169A.52, subdivision 3, paragraph (a), clause (4), (5), or (6), or subdivision 4, paragraph (a), clause (4), (5), or (6); 169A.54, subdivision 1, clause (5), (6), or (7); or 171.177, subdivision 4, paragraph (a), clause (4), (5), or (6), or subdivision 5, paragraph (a), clause (4), (5), or (6); or (2) revoked under section 171.17, subdivision 1, paragraph (a), clause (1), or suspended under section 171.187, for a violation of section 609.2113, subdivision 1, clause (2), item (i) or (iii), (3), or (4); subdivision 2, clause (2), item (i) or (iii), (3), or (4); or subdivision 3, clause (2), item (i) or (iii), (3), or (4); or 609.2114, subdivision 2, clause (2), item (i) or (iii), (3), or (4), resulting in bodily harm, substantial bodily harm, or great bodily harm, where the participant has two or more qualified prior impaired driving incidents within the past ten years or three or more qualified prior impaired driving incidents ever; may apply for conditional reinstatement of the driver's license, subject to the ignition interlock restriction, if the program participant is enrolled in a licensed chemical dependency treatment or rehabilitation program as recommended in a chemical use assessment. As a prerequisite to eligibility for eventual reinstatement of full driving privileges, a participant whose chemical use assessment recommended treatment or rehabilitation shall complete a licensed chemical dependency treatment or rehabilitation program. If the program participant's ignition interlock device subsequently registers a positive breath alcohol concentration of 0.02 or higher, the commissioner shall extend the time period that the participant must participate in the program until the participant has reached the required abstinence period described in section 169A.55, subdivision 4.

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(e) Notwithstanding any statute or rule to the contrary, the commissioner has authority to determine when a program participant is eligible for restoration of full driving privileges, except that the commissioner shall not reinstate full driving privileges until the program participant has met all applicable prerequisites for reinstatement under section 169A.55 and until the program participant's device has registered no positive breath alcohol concentrations of 0.02 or higher during the preceding 90 days.

Sec. 38. [174.125] FEDERAL FUNDS LOCAL ASSISTANCE PROGRAM.

Subdivision 1. Definitions. (a) For purposes of this section, the following terms have the meanings given.

(b) "Commissioner" means the commissioner of transportation.

Subd. 2. Program established. The commissioner must implement a federal funds local assistance program to provide local match aid in an application for federal discretionary or competitive grants.

Subd. 3. Program administration. (a) The commissioner must establish program requirements, including but not limited to: eligibility of projects; solicitation procedures; an application process that is designed to minimize requirements and applicant burdens and to align with federal application requirements; criteria to evaluate applications and select aid recipients subject to subdivision 6; procedures to commit and pay financial assistance; and a schedule that allows for application, evaluation, and awards of aid on a biannual or more frequent basis.

(b) The commissioner must make reasonable efforts to publicize each solicitation among all eligible grant recipients. The commissioner must assist applicants to create and submit applications.

(c) The commissioner may expend up to five percent of available funds in a fiscal year under this section on program administration.

Subd. 4. Local match aid. (a) From funds made available under the program, the commissioner must provide aid to an eligible recipient as provided under subdivision 5. The aid may be provided as direct financial assistance or as a commitment to provide a specific amount of financial assistance contingent on an award of a federal grant to the eligible grant recipient.

(b) Aid under the program:

(1) must provide for a match requirement under a federal discretionary or competitive grant in a manner that meets federal requirements;

(2) must be for a transportation-related project, program, or expenditure;

(3) may equal a portion or the entire amount necessary for the federal match requirement; and

(4) may exceed the amount necessary for the federal match requirement if the commissioner determines that an additional local match is:

(i) materially likely to increase the competitiveness of the federal application; and

(ii) anticipated to be generally comparable to competing applications for the federal grant.

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(c) If a federal grant award amount differs from the amount anticipated at the time of application for aid under the program, the commissioner may adjust the aid amount provided for the project or leave the aid amount unchanged.

Subd. 5. Aid recipient eligibility. The following are eligible aid recipients under the program:

(1) a local unit of government, including but not limited to metropolitan planning organizations;

(2) a Tribal government of a Tribe recognized by the United States Department of the Interior Bureau of Indian Affairs;

(3) a partnership of entities identified in clauses (1) and (2);

(4) the commissioner on behalf of or acting as the agent of a local unit of government or a Tribal government; and

(5) an entity that is eligible for a federal grant under the applicable federal program.

Subd. 6. Project evaluation. The commissioner must establish criteria to evaluate projects for aid under the program. At a minimum, the criteria must provide for prioritization and project selection based on:

(1) the extent to which the project provides an identifiable impact in the following:

(i) improvements to traffic safety;

(ii) improvements to pedestrian and bicyclist safety;

(iii) reduction in vehicle miles traveled;

(iv) providing for increased use of low-emission or zero-emission vehicles;

(v) reduction in greenhouse gas emissions; and

(vi) increases in equity for transportation facilities or programs in communities that are historically or currently underrepresented in local or regional transportation planning or projects, including Indigenous communities, communities of color, low-income households, people with disabilities, and people with limited English proficiency;

(2) anticipated competitiveness of the project for a federal grant or the existence of a federal grant award for the project;

(3) measurable benefits with respect to transportation system performance targets or system plans; and

(4) alignment with the transportation system goal under section 174.01, subdivision 2, clause (9).

Subd. 7. Allocation categories. (a) The commissioner must categorize projects into one of the allocation categories under paragraph (b). For a project that may be reasonably categorized into more than one of the allocation categories, the commissioner must determine the allocation category that reflects the predominant purpose of the project.

(b) In each fiscal year in which local match aid is provided under the program, the commissioner must apportion the aid among the following allocation categories:

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(1) 15 percent for local road and bridge projects;

(2) ten percent for transit projects outside the metropolitan area, as defined in section 473.121, subdivision 2;

(3) five percent for active transportation projects;

(4) three percent for electric vehicle infrastructure projects; and

(5) 67 percent on a flexible basis, which includes projects that are not otherwise categorized under this paragraph and projects that are categorized under clauses (1) to (4).

(c) The commissioner may reallocate funds that remain in an allocation category under paragraph (b) following the conclusion of aid awards in a fiscal year.

Subd. 8. Legislative report. (a) Annually by December 15, the commissioner must submit a report on the program to the legislative committees with jurisdiction over transportation policy and finance. At a minimum, the report must include:

(1) an overview of program implementation;

(2) a review of the project evaluation criteria established under subdivision 6;

(3) a fiscal review that includes a summary of aid awarded under the program with a breakout by allocation category under subdivision 7 and the associated federal grants;

(4) an amount that is recommended to appropriate for the program in each of the upcoming two fiscal years, including an analysis of development of the recommended amount and an estimated breakout of aid by transportation mode or similar categorization; and

(5) any recommendations for legislative changes to the program.

(b) This subdivision expires June 30, 2026.

Sec. 39. [174.127] FEDERAL GRANTS TECHNICAL ASSISTANCE.

(a) Subject to funds made available for purposes of this section, the commissioner must establish a process that provides for technical assistance to a requesting local unit of government or Tribal government that seeks to evaluate or submit an application for a federal discretionary grant for a transportation project, program, or expenditure.

(b) As necessary, the commissioner must prioritize requests for technical assistance based on applicant capacity to effectively complete a competitive federal grant application and history of prior federal grant applications.

(1) providing support for grant writing, analysis, technical review, application finalization, or similar activities;

(2) providing general programmatic or legal information necessary to complete an application; and

(3) making information available on general actions to enhance the competitiveness of federal applications.

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Sec. 40. Minnesota Statutes 2020, section 174.52, subdivision 3, is amended to read:

Subd. 3. Advisory committee. (a) The commissioner ~~shall~~ must establish a local road improvement program advisory committee consisting of ~~five~~ the following members~~, including~~:

(1) one county commissioner;

(2) one county engineer;

(3) one city engineer;

(4) one city council member or city administrator representing a city with a population over 5,000; ~~and~~

(5) one city council member or city administrator representing a city with a population under 5,000; and

(6) one town board member appointed by the Minnesota Association of Townships.

(b) The advisory committee ~~shall~~ must provide recommendations to the commissioner regarding expenditures from the accounts established in this section.

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

Sec. 41. Minnesota Statutes 2020, section 216D.03, is amended by adding a subdivision to read:

Subd. 5. Excavation notice system performance reporting. (a) Each operator must submit a report to the Office of Pipeline Safety on a quarterly basis, using a form or database entry designated by the Office of Pipeline Safety. The report must contain the following information:

(1) the total number of notifications and the number of notifications itemized by type;

(2) for each notification type, the percentage of notifications marked by the start time on the notice; and

(3) the number of utility damages, itemized by the cause of the damages.

(b) An operator, other than a pipeline operator subject to chapter 299F or 299J, with fewer than 5,000 notifications received during the previous calendar year is exempt from the reporting requirement under paragraph (a).

Sec. 42. Minnesota Statutes 2020, section 219.1651, is amended to read:

219.1651 GRADE CROSSING SAFETY ACCOUNT.

A Minnesota grade crossing safety account is created in the special revenue fund, consisting of money credited to the account by law. Money in the account is appropriated to the commissioner of transportation for rail-highway grade crossing safety projects on public streets and highways, including engineering costs and other costs associated with administration and delivery of grade crossing safety projects. At the discretion of the commissioner of transportation, money in the account at the end of each biennium may cancel to the trunk highway fund.

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Sec. 43. Minnesota Statutes 2020, section 221.025, is amended to read:

221.025 EXEMPTIONS.

The provisions of this chapter requiring a certificate or permit to operate as a motor carrier do not apply to the intrastate transportation described below:

(1) the transportation of students to or from school or school activities in a school bus inspected and certified under section 169.451 ~~and~~, the transportation of children or parents to or from a Head Start facility or Head Start activity in a Head Start bus inspected and certified under section 169.451, and the use of a school bus while operating in accordance with section 169.4476;

(2) the transportation of solid waste, as defined in section 116.06, subdivision 22, including recyclable materials and waste tires, except that the term "hazardous waste" has the meaning given it in section 221.012, subdivision 18;

(3) a commuter van as defined in section 221.012, subdivision 9;

(4) authorized emergency vehicles as defined in section 169.011, subdivision 3, including ambulances; and tow trucks equipped with proper and legal warning devices when picking up and transporting (i) disabled or wrecked motor vehicles or (ii) vehicles towed or transported under a towing order issued by a public employee authorized to issue a towing order;

(5) the transportation of grain samples under conditions prescribed by the commissioner;

(6) the delivery of agricultural lime;

(7) the transportation of dirt and sod within an area having a 50-mile radius from the home post office of the person performing the transportation;

(8) the transportation of sand, gravel, bituminous asphalt mix, concrete ready mix, concrete blocks or tile and the mortar mix to be used with the concrete blocks or tile, or crushed rock to or from the point of loading or a place of gathering within an area having a 50-mile radius from that person's home post office or a 50-mile radius from the site of construction or maintenance of public roads and streets;

(9) the transportation of pulpwood, cordwood, mining timber, poles, posts, decorator evergreens, wood chips, sawdust, shavings, and bark from the place where the products are produced to the point where they are to be used or shipped;

(10) the transportation of fresh vegetables from farms to canneries or viner stations, from viner stations to canneries, or from canneries to canneries during the harvesting, canning, or packing season, or transporting sugar beets, wild rice, or rutabagas from the field of production to the first place of delivery or unloading, including a processing plant, warehouse, or railroad siding;

(11) the transportation of unprocessed dairy products in bulk within an area having a 100-mile radius from the home post office of the person providing the transportation;

(12) the transportation of agricultural, horticultural, dairy, livestock, or other farm products within an area having a 100-mile radius from the person's home post office and the carrier may transport other commodities within the 100-mile radius if the destination of each haul is a farm;

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(13) the transportation of newspapers, telephone books, handbills, circulars, or pamphlets in a vehicle with a gross vehicle weight of 10,000 pounds or less; and

(14) transportation of potatoes from the field of production, or a storage site owned or otherwise controlled by the producer, to the first place of processing.

The exemptions provided in this section apply to a person only while the person is exclusively engaged in exempt transportation.

Sec. 44. Minnesota Statutes 2020, section 299A.41, subdivision 3, is amended to read:

Subd. 3. Killed in the line of duty. (a) "Killed in the line of duty" does not include deaths from natural causes, except as provided in this subdivision. In the case of a public safety officer, killed in the line of duty includes the death of a public safety officer caused by accidental means while the public safety officer is acting in the course and scope of duties as a public safety officer.

(b) Killed in the line of duty also means if a public safety officer dies as the direct and proximate result of a heart attack, stroke, or vascular rupture, that officer shall be presumed to have died as the direct and proximate result of a personal injury sustained in the line of duty if:

(1) that officer, while on duty:

(i) engaged in a situation, and that engagement involved nonroutine stressful or strenuous physical law enforcement, fire suppression, rescue, hazardous material response, emergency medical services, prison security, disaster relief, or other emergency response activity; or

(ii) participated in a training exercise, and that participation involved nonroutine stressful or strenuous physical activity;

(2) that officer died as a result of a heart attack, stroke, or vascular rupture suffered:

(i) while engaging or participating under clause (1);

(ii) while still on duty after engaging or participating under clause (1); or

(iii) not later than 24 hours after engaging or participating under clause (1); and

(3) the presumption is not overcome by competent medical evidence to the contrary.

(1) the result of a disabling cancer of a type caused by exposure to heat, radiation, or a known or suspected carcinogen, as defined by the International Agency for Research on Cancer, and the carcinogen is reasonably linked to the disabling cancer; or

(2) the result of suicide secondary to a diagnosis of post-traumatic stress disorder as described in the most recently published edition of the Diagnostic and Statistical Manual of Mental Disorders by the American Psychiatric Association.

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Sec. 45. Minnesota Statutes 2020, section 299D.03, subdivision 5, is amended to read:

Subd. 5. Traffic fines and forfeited bail money. (a) All fines and forfeited bail money collected from persons apprehended or arrested by officers of the State Patrol shall be transmitted by the person or officer collecting the fines, forfeited bail money, or installments thereof, on or before the tenth day after the last day of the month in which these moneys were collected, to the commissioner of management and budget. Except where a different disposition is required in this subdivision or section 387.213, or otherwise provided by law, three-eighths of these receipts must be deposited in the state treasury and credited to the state general fund. The other five-eighths of these receipts must be deposited in the state treasury and credited as follows: (1) the first ~~$1,000,000~~ $2,500,000 in each fiscal year must be credited to the Minnesota grade crossing safety account in the special revenue fund, and (2) remaining receipts must be credited to the state trunk highway fund. If, however, the violation occurs within a municipality and the city attorney prosecutes the offense, and a plea of not guilty is entered, one-third of the receipts shall be deposited in the state treasury and credited to the state general fund, one-third of the receipts shall be paid to the municipality prosecuting the offense, and one-third shall be deposited in the state treasury and credited to the Minnesota grade crossing safety account or the state trunk highway fund as provided in this paragraph. When section 387.213 also is applicable to the fine, section 387.213 shall be applied before this paragraph is applied. All costs of participation in a nationwide police communication system chargeable to the state of Minnesota shall be paid from appropriations for that purpose.

(b) All fines and forfeited bail money from violations of statutes governing the maximum weight of motor vehicles, collected from persons apprehended or arrested by employees of the state of Minnesota, by means of stationary or portable scales operated by these employees, shall be transmitted by the person or officer collecting the fines or forfeited bail money, on or before the tenth day after the last day of the month in which the collections were made, to the commissioner of management and budget. Five-eighths of these receipts shall be deposited in the state treasury and credited to the state highway user tax distribution fund. Three-eighths of these receipts shall be deposited in the state treasury and credited to the state general fund.

Sec. 46. Minnesota Statutes 2020, section 299F.60, subdivision 1, is amended to read:

Subdivision 1. Money penalty. Any person who violates any provision of sections 299F.56 to 299F.641, or any rule issued thereunder, is subject to a civil penalty to be imposed by the commissioner not to exceed ~~$100,000 for each violation for each day that the violation persists, except that the maximum civil penalty must not exceed $1,000,000 for any related series of violations~~ the maximum penalties listed in Code of Federal Regulations, title 49, part 190.

Sec. 47. Minnesota Statutes 2020, section 299J.16, subdivision 1, is amended to read:

Subdivision 1. Civil penalty. (a) A pipeline operator who violates section 299J.07, subdivision 1, or 299J.15, or the rules of the commissioner implementing those sections, shall forfeit and pay to the state a civil penalty in an amount to be determined by the court, up to ~~$100,000 for each day that the operator remains in violation, subject to a maximum of $1,000,000 for a related series of violations~~ the maximum penalties listed in Code of Federal Regulations, title 49, part 190.

(b) The penalty provided under this subdivision may be recovered by an action brought by the attorney general at the request of the commissioner, in the name of the state, in connection with an action to recover expenses of the director under section 299J.13, subdivision 4:

(1) in the District Court of Ramsey County; or

(2) in the county of the defendant's residence.

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Sec. 48. Minnesota Statutes 2021 Supplement, section 360.55, subdivision 9, is amended to read:

Subd. 9. Small unmanned aircraft systems. (a) Any small unmanned aircraft system ~~in which the unmanned aircraft weighs less than 55 pounds at takeoff, including payload and anything affixed to the aircraft, either~~, as defined in section 360.013, subdivision 57b:

(1) must be registered in the state for an annual fee of $25; or

(2) is not subject to registration or an annual fee if the unmanned aircraft system is owned and operated solely for recreational purposes.

(b) An unmanned aircraft system that meets the requirements under paragraph (a) is exempt from aircraft registration tax under sections 360.511 to 360.67.

(c) Owners must, at the time of registration, provide proof of insurability in a form acceptable to the commissioner. Additionally, owners must maintain records and proof that each flight was covered by an insurance policy with limits of not less than $300,000 per occurrence for bodily injury or death to nonpassengers in any one accident. The insurance must comply with section 60A.081, unless that section is inapplicable under section 60A.081, subdivision 3.

Sec. 49. Minnesota Statutes 2021 Supplement, section 360.59, subdivision 10, is amended to read:

Subd. 10. Certificate of insurance. (a) Every owner of aircraft in this state when applying for registration, reregistration, or transfer of ownership shall supply any information the commissioner reasonably requires to determine that the aircraft during the period of its contemplated operation is covered by an insurance policy with limits of not less than $100,000 per passenger seat liability both for passenger bodily injury or death and for property damage; not less than $100,000 for bodily injury or death to each nonpassenger in any one accident; and not less than $300,000 per occurrence for bodily injury or death to nonpassengers in any one accident. The insurance must comply with section 60A.081, unless that section is inapplicable under section 60A.081, subdivision 3.

The information supplied to the commissioner must include but is not limited to the name and address of the owner, the period of contemplated use or operation, if any, and, if insurance coverage is then presently required, the name of the insurer, the insurance policy number, the term of the coverage, policy limits, and any other data the commissioner requires. No certificate of registration shall be issued pursuant to subdivision 3 in the absence of the information required by this subdivision.

(b) In the event of cancellation of aircraft insurance by the insurer, the insurer shall notify the Department of Transportation at least ten days prior to the date on which the insurance coverage is to be terminated. Unless proof of a new policy of insurance is filed with the department meeting the requirements of this subdivision during the period of the aircraft's contemplated use or operation, the registration certificate for the aircraft shall be revoked forthwith.

(c) Nothing in this subdivision shall be construed to require an owner of aircraft to maintain passenger seat liability coverage on aircraft for which an experimental certificate has been issued by the administrator of the Federal Aviation Administration pursuant to Code of Federal Regulations, title 14, sections 21.191 to 21.195 and 91.319, whereunder persons operating the aircraft are prohibited from carrying passengers in the aircraft or for an unmanned aircraft. Whenever the aircraft becomes certificated to carry passengers, passenger seat liability coverage shall be required as provided in this subdivision.

(d) The requirements of this subdivision shall not apply to any aircraft built by the original manufacturer prior to December 31, 1939, and owned and operated solely as a collector's item, if the owner files an affidavit with the commissioner. The affidavit shall state the owner's name and address, the name and address of the person from

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whom the aircraft was purchased, the make, year, and model number of the aircraft, the federal aircraft registration number, the manufacturer's identification number, and that the aircraft is owned and operated solely as a collector's item and not for general transportation purposes.

(e) A small unmanned aircraft system that meets the requirements of section 360.55, subdivision 9, is not subject to the requirements under paragraphs (a) and (b). Owners of small unmanned aircraft systems that meet the requirements of section 360.55, subdivision 9, must, at the time of registration, provide proof of insurability in a form acceptable to the commissioner. Additionally, such operators must maintain records and proof that each flight was insured for the limits established in paragraph (a).

Sec. 50. Minnesota Statutes 2020, section 473.375, is amended by adding a subdivision to read:

Subd. 9b. Safe accessibility training. (a) The council must ensure that vehicle operators who provide bus service receive training on assisting persons with disabilities and mobility limitations to enter and leave the vehicle. The training must cover assistance in circumstances where regular access to or from the vehicle is unsafe due to snow, ice, or other obstructions. This subdivision applies to vehicle operators employed by the Metropolitan Council or by a replacement service provider.

(b) The council must consult with the Transportation Accessibility Advisory Committee on the training.

EFFECTIVE DATE; APPLICATION. This section is effective the day following final enactment and applies in the counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington.

Sec. 51. [473.4075] TRANSIT SAFETY REPORTING.

(a) By February 15 annually, the council must submit a report on transit safety and administrative citations to the members of the legislative committees with jurisdiction over transportation policy and finance.

(b) At a minimum, the report must:

(1) provide an overview of transit safety issues and actions taken by the council to improve safety;

(2) provide an overview of administrative citations under section 473.4085, including a summary of implementation and analysis of impacts of the program on fare compliance and customer experience for riders;

(3) for each of the previous three calendar years, provide data and statistics on:

(i) crime rates occurring on public transit vehicles and at transit stops and stations;

(ii) the number of warnings and criminal citations issued by the Metropolitan Transit Police, with a breakout by categorized reasons for a warning or citation; and

(iii) the number of administrative citations issued, with a breakout by issuance by peace officers, community service officers, and other authorized nonsworn personnel;

(4) for each of the previous three calendar years, state the number of peace officers employed by the Metropolitan Transit Police Department;

(5) state the average number of peace officers employed by the Metropolitan Transit Police Department for the previous three calendar years; and

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(6) make recommendations on how to improve safety on public transit and transit stops and stations, and for legislative changes, if any.

APPLICATION. This section applies in the counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington.

Sec. 52. [473.4085] ADMINISTRATIVE CITATIONS.

Subdivision 1. Authority. (a) Subject to requirements established by the Metropolitan Council, the council may issue an administrative citation to a person who commits a violation under section 609.855, subdivision 1, paragraph (a), clause (1), if the violation occurs:

(1) in a council transit vehicle or transit facility in the metropolitan area; or

(2) in the case of commuter rail service, in a council commuter vehicle or commuter facility in any corridor that is located in whole or in part in the metropolitan area.

(b) Transit fare compliance may be enforced and administrative citations may be issued by peace officers of the council's Metropolitan Transit Police, and by community service officers or other nonsworn personnel as authorized by the council.

Subd. 2. Fine; contested citation; resolution. (a) A person who is issued an administrative citation under this section must, within 90 days of issuance, pay a fine as determined by the council. A person who fails to either pay the fine or contest the administrative citation within the specified period is considered to have waived the contested citation process and is subject to collections, including collection costs.

(b) The council must set the amount of the fine at no less than $35. The council may establish an escalating fine structure for persons who fail to pay administrative citations or who repeatedly commit a violation under section 609.855, subdivision 1, paragraph (a), clause (1).

(c) The council may adopt an alternative resolution procedure under which a person may resolve an administrative citation in lieu of paying a fine by complying with terms established by the council for community service, prepayment of future transit fares, or both. The alternative resolution procedure must be available only to a person who has committed a violation under section 609.855, subdivision 1, paragraph (a), clause (1), for the first time, unless the person demonstrates financial hardship under criteria established by the council.

(d) The council must provide a civil process that allows a person to contest an administrative citation before a neutral third party. The council may employ a person not associated with its transit operations, or enter into an agreement with another unit of government, to hear and rule on challenges to administrative citations.

Subd. 3. Other requirements. (a) An administrative citation must include notification that the person has the right to contest the citation, basic procedures for contesting the citation, and information on the timeline and consequences related to the citation.

(b) The council must not mandate or suggest a quota for the issuance of administrative citations under this section.

(c) The council must collect and maintain fines under this section in a separate account that is only used to cover costs under this section.

EFFECTIVE DATE; APPLICATION. This section is effective the day following final enactment and applies to violations committed on or after that date. This act applies in the counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, Sherburne, and Washington.

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Sec. 53. Minnesota Statutes 2020, section 609.855, subdivision 1, is amended to read:

Subdivision 1. Unlawfully obtaining services; misdemeanor. (a) A person is guilty of a misdemeanor who intentionally obtains or attempts to obtain service for himself, herself, or another person from a provider of public transit or from a public conveyance by doing any of the following:

(1) occupies or rides in any public transit vehicle without paying the applicable fare or otherwise obtaining the consent of the transit provider including:

(i) the use of a reduced fare when a person is not eligible for the fare; or

(ii) the use of a fare medium issued solely for the use of a particular individual by another individual;

(2) presents a falsified, counterfeit, photocopied, or other deceptively manipulated fare medium as fare payment or proof of fare payment;

(3) sells, provides, copies, reproduces, or creates any version of any fare medium without the consent of the transit provider; or

(4) puts or attempts to put any of the following into any fare box, pass reader, ticket vending machine, or other fare collection equipment of a transit provider:

(i) papers, articles, instruments, or items other than fare media or currency; or

(ii) a fare medium that is not valid for the place or time at, or the manner in, which it is used.

(b) Where self-service barrier-free fare collection is utilized by a public transit provider, it is a violation of this subdivision to intentionally fail to exhibit proof of fare payment upon the request of an authorized transit representative when entering, riding upon, or leaving a transit vehicle or when present in a designated paid fare zone located in a transit facility.

(c) Issuance of an administrative citation under section 473.4085 prevents imposition of a misdemeanor citation under this subdivision.

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

Sec. 54. Minnesota Statutes 2020, section 609.855, subdivision 7, is amended to read:

Subd. 7. Definitions. (a) The definitions in this subdivision apply in this section.

(b) "Public transit" or "transit" has the meaning given in section 174.22, subdivision 7.

(c) "Public transit vehicle" or "transit vehicle" means any vehicle used for the purpose of providing public transit, whether or not the vehicle is owned or operated by a public entity.

(d) "Public transit facilities" or "transit facilities" means any vehicles, equipment, property, structures, stations, improvements, plants, parking or other facilities, or rights that are owned, leased, held, or used for the purpose of providing public transit, whether or not the facility is owned or operated by a public entity.

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(e) "Fare medium" means a ticket, smart card, pass, coupon, token, transfer, or other medium sold or distributed by a public transit provider, or its authorized agents, for use in gaining entry to or use of the public transit facilities or vehicles of the provider.

(f) "Proof of fare payment" means a fare medium valid for the place or time at, or the manner in, which it is used. If using a reduced-fare medium, proof of fare payment also includes proper identification demonstrating a person's eligibility for the reduced fare. If using a fare medium issued solely for the use of a particular individual, proof of fare payment also includes an identification document bearing a photographic likeness of the individual and demonstrating that the individual is the person to whom the fare medium is issued.

(g) "Authorized transit representative" means the person authorized by the transit provider to operate the transit vehicle, a peace officer, or any other person designated by the transit provider as an authorized transit ~~provider~~ representative under this section.

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

Sec. 55. LEGISLATIVE ROUTE NO. 274 REMOVED.

(a) Minnesota Statutes, section 161.115, subdivision 205, is repealed effective the day after the commissioner of transportation receives a copy of the agreement between the commissioner and the governing body of Yellow Medicine County to transfer jurisdiction of a segment of Legislative Route No. 274 and notifies the revisor of statutes under paragraph (b).

(b) The revisor of statutes shall delete the route identified in paragraph (a) from Minnesota Statutes when the commissioner of transportation sends notice to the revisor electronically or in writing that the conditions required to transfer the route have been satisfied.

Sec. 56. LEGISLATIVE ROUTE NO. 301 REMOVED.

(a) Minnesota Statutes, section 161.115, subdivision 232, is repealed effective the day after the commissioner of transportation receives a copy of the agreement between the commissioner and the governing body of the city of St. Cloud to transfer jurisdiction of Legislative Route No. 301 and notifies the revisor of statutes under paragraph (b).

Sec. 57. TRANSIT SIGNAL PRIORITY SYSTEM PLANNING.

Subdivision 1. Establishment. By August 1, 2022, the Metropolitan Council must convene a working group to perform planning on transit signal priority systems and related transit advantage improvements on high-frequency and high-ridership bus routes in the metropolitan area, as defined in Minnesota Statutes, section 473.121, subdivision 2.

Subd. 2. Membership. The Metropolitan Council must solicit the following members to participate in the working group:

(1) one member representing Metro Transit, appointed by the Metropolitan Council;

(2) one member representing the Department of Transportation, appointed by the commissioner of transportation;

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(3) one member representing Minneapolis, appointed by the Minneapolis City Council;

(4) one member representing St. Paul, appointed by the St. Paul City Council;

(5) one member representing Hennepin County, appointed by the Hennepin County Board;

(6) one member representing Ramsey County, appointed by the Ramsey County Board;

(7) one member from a city participating in the replacement service program under Minnesota Statutes, section 473.388, appointed by the Suburban Transit Association;

(8) one member from the Center for Transportation Studies at the University of Minnesota;

(9) one member from Move Minnesota; and

(10) other members as identified by the Metropolitan Council.

Subd. 3. Duties. At a minimum, the working group must:

(1) assess the current status and capability of transit signal priority systems among the relevant road authorities;

(2) identify key barriers and constraints and measures to address the barriers;

(3) explore methods for ongoing coordination among the relevant road authorities;

(4) estimate costs of potential improvements; and

(5) develop a proposal or recommendations to implement transit signal priority systems and related transit advantage improvements, including a prioritized listing of locations or routes.

Subd. 4. Administration. Upon request of the working group, the Metropolitan Council and the commissioner of transportation must provide administrative and technical support for the working group.

Subd. 5. Report. By December 15, 2022, the Metropolitan Council must submit a report on transit signal priority system improvements to the chairs and ranking minority members of the legislative committees with jurisdiction over transportation policy and finance. At a minimum, the report must summarize the results of the working group and provide information on each of the activities specified in subdivision 3.

Subd. 6. Expiration. The working group under this section expires December 31, 2022.

EFFECTIVE DATE; APPLICATION. This section is effective the day following final enactment and applies in the counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington.

Sec. 58. SPEED SAFETY CAMERA PILOT PROJECT IMPLEMENTATION PLAN.

By December 15, 2022, the commissioners of public safety and transportation must jointly submit a speed safety camera pilot project implementation plan to the chairs and ranking minority members of the legislative committees with jurisdiction over transportation policy and finance. The plan must conform to the recommendations in the work zone speed management study required under Laws 2021, First Special Session chapter 5, article 4, section 140.

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Sec. 59. ROAD USAGE CHARGE TASK FORCE.

Subdivision 1. Definition. (a) For purposes of this section, the following terms have the meanings given.

(b) "Road usage charge" means a tax, fee, or other charge imposed on a motor vehicle on the basis of distance traveled or other measure of vehicle use of public highways.

Subd. 2. Establishment. The Road Usage Charge Task Force is established to develop recommendations on implementation of a road usage charge in Minnesota.

Subd. 3. Membership. (a) The task force consists of the following members:

(1) two members of the senate, with one appointed by the senate majority leader and one appointed by the senate minority leader;

(2) two members of the house of representatives, with one appointed by the speaker of the house and one appointed by the house minority leader;

(3) one member from the Department of Transportation appointed by the commissioner of transportation;

(4) one member from the Driver and Vehicle Services Division of the Department of Public Safety appointed by the commissioner of public safety;

(5) one member from the Public Utilities Commission appointed by the Minnesota Public Utilities Commission;

(6) one member representing public utilities, as defined in section 216B.02, subdivision 4, that provide electric service to retail customers in Minnesota appointed by the commissioner of transportation;

(7) one member appointed by the Alliance for Automotive Innovation;

(8) one member appointed by the Center for Transportation Studies of the University of Minnesota;

(9) one member appointed by the Minnesota Transportation Alliance;

(10) one member appointed by the Minnesota Chamber of Commerce;

(11) one member appointed by the Great Plains Institute;

(12) one member appointed by Fresh Energy; and

(13) one member appointed by the Minnesota Electric Vehicle Owners chapter of the Electric Vehicle Association.

(b) Appointing authorities must make initial appointments to the task force by August 1, 2022.

Subd. 4. Duties. The task force must:

(1) identify and analyze road usage charge options and considerations, including with respect to technical constraints, revenue impacts, equity across highway system users, data privacy, and impacts to motorists;

(2) review road usage charge implementation in other states;

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(3) evaluate road usage charge implementation in Minnesota for all-electric vehicles or electric vehicles, as the terms are defined in Minnesota Statutes, section 169.011, subdivisions 1a and 26a; and

(4) develop recommendations for a pilot program or for phased or full road usage charge implementation, including proposed legislation.

Subd. 5. Meetings; chair. (a) By September 15, 2022, the chair of the Legislative Coordinating Commission must convene the first meeting of the task force.

(b) At the first meeting, the task force must elect a chair or cochairs by a majority vote of those members present.

Subd. 6. Administration. (a) The Legislative Coordinating Commission must provide administrative assistance to the task force.

(b) Upon request of the task force, the commissioners of transportation and public safety must provide general informational and technical support to the task force.

Subd. 7. Compensation. Members of the task force serve without compensation.

Subd. 8. Report. By January 15, 2023, the task force must submit a report to the chairs and ranking minority members of the legislative committees with jurisdiction over transportation policy and finance. At a minimum, the report must summarize the activities of the task force and provide information on the duties specified in subdivision 4.

Subd. 9. Expiration. The task force expires on January 15, 2023.

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

Sec. 60. REPORT; HIGHWAYS FOR HABITAT PROGRAM.

By January 15, 2025, the commissioner of transportation must submit a report to the chairs and ranking minority members of the legislative committees with jurisdiction over transportation and the environment and natural resources on the implementation of the highways for habitat program under Minnesota Statutes, section 160.2325. At a minimum, the report must include an overview of program implementation and information on expenditure of funds under the program.

Sec. 61. REPEALER.

Minnesota Rules, part 8835.0350, subpart 2, is repealed.

ARTICLE 4

INDEPENDENT EXPERT REVIEW PROVISIONS

Section 1. Minnesota Statutes 2020, section 168.002, is amended by adding a subdivision to read:

Subd. 12a. Full-service provider. "Full-service provider" means a person who is appointed by the commissioner as both a deputy registrar under this chapter and a driver's license agent under chapter 171 who provides all driver services, excluding International Registration Plan and International Fuel Tax Agreement transactions.

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Sec. 2. Minnesota Statutes 2021 Supplement, section 168.327, subdivision 1, is amended to read:

Subdivision 1. Records and fees. (a) Upon request by any person authorized in this section, the commissioner ~~shall~~ or full-service provider must furnish a certified copy of any driver's license record, instruction permit record, Minnesota identification card record, vehicle registration record, vehicle title record, or accident record.

(b) Except as provided in subdivisions 4, 5a, and 5b, and other than accident records governed under section 169.09, subdivision 13, the requester ~~shall~~ must pay a fee of $10 for each certified record specified in paragraph (a) or a fee of $9 for each record that is not certified.

(c) Except as provided in subdivisions 4, 5a, and 5b, in addition to the record fee in paragraph (b), the fee for a copy of the history of any vehicle title not in electronic format is $1 for each page of the historical record.

(d) ~~Fees~~ Of the fee collected by the commissioner under paragraph (b) for driver's license, instruction permit, and Minnesota identification card records, ~~must be paid into the state treasury with~~ 50 cents ~~of each fee credited to~~ must be deposited in the general fund., and the remainder ~~of the fees collected must be credited to~~ must be deposited in the driver services operating account in the special revenue fund under section 299A.705. Of the fee collected by a full-service provider under paragraph (b) for driver's license, instruction permit, and Minnesota identification card records, the provider must transmit 50 cents to the commissioner to be deposited in the general fund, and the provider must retain the remainder.

(e) ~~Fees~~ Of the fee collected by the commissioner under paragraphs (b) and (c) for vehicle registration or title records, ~~must be paid into the state treasury with~~ 50 cents ~~of each fee credited to~~ must be deposited in the general fund., and the remainder ~~of the fees collected must be credited to~~ must be deposited in the vehicle services operating account in the special revenue fund specified in section 299A.705. Of the fee collected by a full-service provider under paragraphs (b) and (c) for vehicle registration or title records, the provider must transmit 50 cents of each fee to the commissioner to be deposited in the general fund, and the provider must retain the remainder.

(f) Except as provided in subdivisions 4, 5a, and 5b, the commissioner ~~shall~~ or full-service provider must permit a person to inquire into a record by the person's own electronic means for a fee of $4.50 for each inquiry, except that no fee may be charged when the requester is the subject of the data.

(g) Of the fee collected by the commissioner under paragraph (f):

(1) $2.70 must be deposited in the general fund;

(2) for driver's license, instruction permit, or Minnesota identification card records, the remainder must be deposited in the driver services operating account in the special revenue fund under section 299A.705; and

(3) for vehicle title or registration records, the remainder must be deposited in the vehicle services operating account in the special revenue fund under section 299A.705.

(h) Of the fee collected by a full-service provider under paragraph (f), the provider must transmit $2.70 to the commissioner to be deposited into the general fund, and the provider must retain the remainder.

~~(g)~~ (i) Fees and the deposit of the fees for accident records and reports are governed by section 169.09, subdivision 13.

EFFECTIVE DATE. This section is effective August 1, 2022, and applies to requests for records made on or after that date.

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Sec. 3. Minnesota Statutes 2020, section 168.327, subdivision 2, is amended to read:

Subd. 2. Requests for information; surcharge on fee. (a) Except as otherwise provided in subdivision 3, the commissioner ~~shall~~ or full-service provider must impose a surcharge of 50 cents on each fee charged by the commissioner or full-service provider under section 13.03, subdivision 3, for copies or electronic transmittals of public information about the registration of a vehicle or an applicant, or holder of a driver's license, instruction permit, or Minnesota identification card.

(b) The surcharge only applies to a fee imposed in response to a request made in person or, by mail, or ~~to a request for transmittal through a computer modem~~ online. The surcharge does not apply to the request of an individual for information about that individual's driver's license, instruction permit, or Minnesota identification card or about vehicles registered or titled in the individual's name.

(c) The surcharges collected by the commissioner under this subdivision must be credited to the general fund. The surcharges collected by a full-service provider must be transmitted to the commissioner to be deposited in the general fund.

EFFECTIVE DATE. This section is effective August 1, 2022, and applies to requests for records made on or after that date.

Sec. 4. Minnesota Statutes 2020, section 168.327, subdivision 3, is amended to read:

Subd. 3. Exception to fee and surcharge. (a) Notwithstanding subdivision 2 or section 13.03, a fee or surcharge may not be imposed in response to a request for public information about the registration of a vehicle if the commissioner or full-service provider is satisfied that:

(1) the requester seeks the information on behalf of a community-based, nonprofit organization designated by a local law enforcement agency to be a requester; and

(2) the information is needed to identify suspected prostitution law violators, controlled substance law violators, or health code violators.

(b) The commissioner ~~shall~~ or full-service provider must not require a requester under paragraph (a) to make a minimum number of data requests or limit the requester to a maximum number of data requests.

EFFECTIVE DATE. This section is effective August 1, 2022, and applies to requests for records made on or after that date.

Sec. 5. Minnesota Statutes 2020, section 168.33, subdivision 7, is amended to read:

Subd. 7. Filing fees; allocations. (a) In addition to all other statutory fees and taxes, a filing fee of:

(1) $7 is imposed on every vehicle registration renewal, excluding pro rate transactions; and

(2) $11 is imposed on every other type of vehicle transaction, including motor carrier fuel licenses under sections 168D.05 and 168D.06, and pro rate transactions.

(b) Notwithstanding paragraph (a):

(1) a filing fee may not be charged for a document returned for a refund or for a correction of an error made by the Department of Public Safety, a dealer, or a deputy registrar; and

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(2) no filing fee or other fee may be charged for the permanent surrender of a title for a vehicle.

(d) The statutory fees and taxes, and the filing fees imposed under paragraph (a) may be paid by credit card or debit card. The deputy registrar may collect a surcharge on the statutory fees, taxes, and filing fee not greater than the cost of processing a credit card or debit card transaction, in accordance with emergency rules established by the commissioner of public safety. The surcharge must be used to pay the cost of processing credit and debit card transactions.

(e) The fees collected under this subdivision by the department for in-person transactions must be allocated as follows:

(1) of the fees collected under paragraph (a), clause (1):

(i) $5.50 must be deposited in the vehicle services operating account; and

(ii) $1.50 must be deposited in the driver and vehicle services technology account; and

(2) of the fees collected under paragraph (a), clause (2):

(i) $3.50 must be deposited in the general fund;

(ii) $6.00 must be deposited in the vehicle services operating account; and

(iii) $1.50 must be deposited in the driver and vehicle services technology account.

(f) The fees collected under this subdivision by the department for mail or online transactions must be allocated as follows:

(1) of the fees collected under paragraph (a), clause (1):

(i) $2.75 must be deposited in the vehicle services operating account;

(ii) $0.75 must be deposited in the driver and vehicle services technology account; and

(iii) $3.50 must be deposited in the full-service provider account; and

(2) of the fees collected under paragraph (a), clause (2):

(i) $3.50 must be deposited in the general fund;

(ii) $3.00 must be deposited in the vehicle services operating account;

(iii) $0.75 must be deposited in the driver and vehicle services technology account; and

(iv) $3.75 must be deposited in the full-service provider account.

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Sec. 6. Minnesota Statutes 2020, section 168.345, is amended to read:

168.345 USE OF VEHICLE REGISTRATION INFORMATION.

Subdivision 1. Information by telephone. Information about vehicle registrations ~~shall~~ must not be furnished on the telephone to any person except the owner of the vehicle, personnel of law enforcement agencies, and the personnel of governmental motor vehicle and registration offices.

Subd. 2. Lessees; information. The commissioner may not furnish information about registered owners of passenger automobiles who are lessees under a lease for a term of 180 days or more to any person except the owner of the vehicle, the lessee, personnel of law enforcement agencies and trade associations performing a member service under section 604.15, subdivision 4a, and federal, state, and local governmental units, and, at the commissioner's discretion, to persons who use the information to notify lessees of automobile recalls. The commissioner may release information about lessees in the form of summary data, as defined in section 13.02, to persons who use the information in conducting statistical analysis and market research.

Sec. 7. Minnesota Statutes 2021 Supplement, section 169.09, subdivision 13, is amended to read:

Subd. 13. Reports confidential; evidence, fee, penalty, appropriation. (a) All reports and supplemental information required under this section must be for the use of the commissioner of public safety and other appropriate state, federal, county, and municipal governmental agencies for accident analysis purposes, except:

(1) upon written request, the commissioner of public safety, a full-service provider as defined in section 171.01, subdivision 33a, or any law enforcement agency ~~shall~~ must disclose the report required under subdivision 8 to:

(i) any individual involved in the accident, the representative of the individual's estate, or the surviving spouse, or one or more surviving next of kin, or a trustee appointed under section 573.02;

(ii) any other person injured in person, property, or means of support, or who incurs other pecuniary loss by virtue of the accident;

(iii) legal counsel of a person described in item (i) or (ii);

(iv) a representative of the insurer of any person described in item (i) or (ii); or

(v) a city or county attorney or an attorney representing the state in an implied consent action who is charged with the prosecution of a traffic or criminal offense that is the result of a traffic crash investigation conducted by law enforcement;

~~(2) the commissioner of public safety shall, upon written request, provide the driver filing a report under subdivision 7 with a copy of the report filed by the driver;~~

~~(3)~~ (2) the commissioner of public safety may verify with insurance companies vehicle insurance information to enforce sections 65B.48, 169.792, 169.793, 169.796, and 169.797;

~~(4)~~ (3) the commissioner of public safety ~~shall~~ must provide the commissioner of transportation the information obtained for each traffic accident involving a commercial motor vehicle, for purposes of administering commercial vehicle safety regulations;

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~~(5)~~ (4) upon specific request, the commissioner of public safety ~~shall~~ must provide the commissioner of transportation the information obtained regarding each traffic accident involving damage to identified state-owned infrastructure, for purposes of debt collection under section 161.20, subdivision 4; and

~~(6)~~ (5) the commissioner of public safety may give to the United States Department of Transportation commercial vehicle accident information in connection with federal grant programs relating to safety.

(b) Accident reports and data contained in the reports are not discoverable under any provision of law or rule of court. ~~No report shall~~ A report must not be used as evidence in any trial, civil or criminal, or any action for damages or criminal proceedings arising out of an accident. However, the commissioner of public safety ~~shall~~ must furnish, upon the demand of any person who has or claims to have made a report or upon demand of any court, a certificate showing that a specified accident report has or has not been made to the commissioner solely to prove compliance or failure to comply with the requirements that the report be made to the commissioner.

(c) Nothing in this subdivision prevents any individual who has made a report under this section from providing information to any individuals involved in an accident or their representatives or from testifying in any trial, civil or criminal, arising out of an accident, as to facts within the individual's knowledge. It is intended by this subdivision to render privileged the reports required, but it is not intended to prohibit proof of the facts to which the reports relate.

(d) Disclosing any information contained in any accident report, except as provided in this subdivision, section 13.82, subdivision 3 or 6, or other statutes, is a misdemeanor.

(e) The commissioner of public safety ~~shall~~ or full-service provider as defined in section 171.01, subdivision 33a, must charge authorized persons as described in paragraph (a) a $5 fee for a copy of an accident report. Ninety percent of the $5 fee collected by the commissioner under this paragraph must be deposited in the special revenue fund and credited to the driver services operating account established in section 299A.705 and ten percent must be deposited in the general fund. Of the $5 fee collected by a full-service provider, the provider must transmit 50 cents to the commissioner to be deposited into the general fund, and the provider must retain the remainder. The commissioner or full-service provider may also furnish an electronic copy of the database of accident records, which must not contain personal or private data on an individual, to private agencies as provided in paragraph (g), for not less than the cost of preparing the copies on a bulk basis as provided in section 13.03, subdivision 3.

(f) The fees specified in paragraph (e) notwithstanding, the commissioner, a full-service provider, and law enforcement agencies ~~shall~~ must charge commercial users who request access to response or incident data relating to accidents a fee not to exceed 50 cents per record. "Commercial user" is a user who in one location requests access to data in more than five accident reports per month, unless the user establishes that access is not for a commercial purpose. Of the money collected by the commissioner under this paragraph, 90 percent must be deposited in the special revenue fund and credited to the driver services operating account established in section 299A.705 and ten percent must be deposited in the general fund. Of the fees collected by a full-service provider under this paragraph, the provider must transmit 50 cents to the commissioner to be deposited into the general fund, and the provider must retain the remainder.

(g) The fees in paragraphs (e) and (f) notwithstanding, the commissioner ~~shall~~ or full-service provider must provide an electronic copy of the accident records database to the public on a case-by-case basis using the cost‑recovery charges provided for under section 13.03, subdivision 3. The database provided must not contain personal or private data on an individual. However, unless the accident records database includes the vehicle identification number, the commissioner ~~shall~~ or full-service provider must include the vehicle registration plate number if a private agency certifies and agrees that the agency:

(1) is in the business of collecting accident and damage information on vehicles;

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(2) will use the vehicle registration plate number only for identifying vehicles that have been involved in accidents or damaged, to provide this information to persons seeking access to a vehicle's history and not for identifying individuals or for any other purpose; and

(3) will be subject to the penalties and remedies under sections 13.08 and 13.09.

EFFECTIVE DATE. This section is effective August 1, 2022, and applies to requests for records made on or after that date.

Sec. 8. Minnesota Statutes 2020, section 171.01, is amended by adding a subdivision to read:

Subd. 33a. Full-service provider. "Full-service provider" means a person who is appointed by the commissioner as both a driver's license agent who provides all driver services, excluding International Registration Plan and International Fuel Tax Agreement transactions under this chapter and deputy registrar services under chapter 168.

Sec. 9. Minnesota Statutes 2020, section 171.06, subdivision 2, is amended to read:

Subd. 2. Fees. (a) The fees for a license and Minnesota identification card are as follows:

REAL ID Compliant or Noncompliant Classified Driver's License	D-$21.00	C-$25.00	B-$32.00	A-$40.00
REAL ID Compliant or Noncompliant Classified Under-21 D.L.	D-$21.00	C-$25.00	B-$32.00	A-$20.00
Enhanced Driver's License	D-$36.00	C-$40.00	B-$47.00	A-$55.00
REAL ID Compliant or Noncompliant Instruction Permit				$5.25
Enhanced Instruction Permit				$20.25
Commercial Learner's Permit				$2.50
REAL ID Compliant or Noncompliant Provisional License				$8.25
Enhanced Provisional License				$23.25
Duplicate REAL ID Compliant or Noncompliant License or duplicate REAL ID Compliant or Noncompliant identification card				$6.75
Enhanced Duplicate License or enhanced duplicate identification card				$21.75
REAL ID Compliant or Noncompliant Minnesota identification card or REAL ID Compliant or Noncompliant Under‑21 Minnesota identification card, other than duplicate, except as otherwise provided in section 171.07, subdivisions 3 and 3a				$11.25
Enhanced Minnesota identification card				$26.25

From August 1, 2019, to June 30, 2022, the fee is increased by $0.75 for REAL ID compliant or noncompliant classified driver's licenses, REAL ID compliant or noncompliant classified under-21 driver's licenses, and enhanced driver's licenses.

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(b) In addition to each fee required in paragraph (a), the commissioner ~~shall~~ must collect a surcharge of $2.25. Surcharges collected under this paragraph must be credited to the driver and vehicle services technology account under section 299A.705.

(c) Notwithstanding paragraph (a), an individual who holds a provisional license and has a driving record free of (1) convictions for a violation of section 169A.20, 169A.33, 169A.35, sections 169A.50 to 169A.53, or section 171.177, (2) convictions for crash-related moving violations, and (3) convictions for moving violations that are not crash related, ~~shall~~ must have a $3.50 credit toward the fee for any classified under-21 driver's license. "Moving violation" has the meaning given it in section 171.04, subdivision 1.

(d) In addition to the driver's license fee required under paragraph (a), the commissioner ~~shall~~ must collect an additional $4 processing fee from each new applicant or individual renewing a license with a school bus endorsement to cover the costs for processing an applicant's initial and biennial physical examination certificate. The department ~~shall~~ must not charge these applicants any other fee to receive or renew the endorsement.

(e) In addition to the fee required under paragraph (a), a driver's license agent may charge and retain a filing fee as provided under section 171.061, subdivision 4.

(f) In addition to the fee required under paragraph (a), the commissioner ~~shall~~ must charge a filing fee at the same amount as a driver's license agent under section 171.061, subdivision 4. Revenue collected under this paragraph for in-person transactions must be deposited in the driver services operating account under section 299A.705. Revenue collected under this paragraph for mail or online transactions must be allocated as follows:

(1) 50 percent must be deposited in the driver services operating account under section 299A.705, subdivision 2; and

(2) 50 percent must be deposited in the full-service provider account under section 299A.705, subdivision 3a.

(g) An application for a Minnesota identification card, instruction permit, provisional license, or driver's license, including an application for renewal, must contain a provision that allows the applicant to add to the fee under paragraph (a), a $2 donation for the purposes of public information and education on anatomical gifts under section 171.075.

Sec. 10. Minnesota Statutes 2020, section 171.06, is amended by adding a subdivision to read:

Subd. 8. Preapplication; REAL ID. (a) The commissioner must establish a process for an applicant to submit an electronic preapplication for a REAL ID-compliant driver's license or REAL ID-compliant identification card. The commissioner must design the preapplication so that the applicant must enter information required for the application. The preapplication must also generate a list of documents the applicant is required to submit in person at the time of the application. The commissioner must provide a link to the preapplication website at the time an individual schedules an appointment to apply for a REAL ID-compliant driver's license or REAL ID-compliant identification card.

(b) An applicant who submitted a preapplication is required to appear in person before a driver's license agent to submit a completed application for the REAL ID-compliant driver's license or REAL ID-compliant identification card.

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Sec. 11. Minnesota Statutes 2020, section 171.061, subdivision 4, is amended to read:

Subd. 4. Fee; equipment. (a) The agent may charge and retain a filing fee ~~of $8~~ for each application., as follows:

(1) New application for noncompliant driver's license or noncompliant Minnesota identification card	$11.00

(2) New application for REAL ID-compliant driver's license, REAL ID-compliant Minnesota identification card, enhanced driver's license, or enhanced Minnesota identification card	$16.00

(3) Renewal application for noncompliant driver's license or noncompliant Minnesota identification card	$11.00

(4) Renewal application for REAL ID-compliant driver's license, REAL ID-compliant Minnesota identification card, enhanced driver's license, or enhanced Minnesota identification card	$11.00

Except as provided in paragraph (c), the fee ~~shall~~ must cover all expenses involved in receiving, accepting, or forwarding to the department the applications and fees required under sections 171.02, subdivision 3; 171.06, subdivisions 2 and 2a; and 171.07, subdivisions 3 and 3a.

(b) The statutory fees and the filing fees imposed under paragraph (a) may be paid by credit card or debit card. The driver's license agent may collect a convenience fee on the statutory fees and filing fees not greater than the cost of processing a credit card or debit card transaction. The convenience fee must be used to pay the cost of processing credit card and debit card transactions. The commissioner ~~shall~~ must adopt rules to administer this paragraph using the exempt procedures of section 14.386, except that section 14.386, paragraph (b), does not apply.

(c) The department ~~shall~~ must maintain the photo identification equipment for all agents appointed as of January 1, 2000. Upon the retirement, resignation, death, or discontinuance of an existing agent, and if a new agent is appointed in an existing office pursuant to Minnesota Rules, chapter 7404, and notwithstanding the above or Minnesota Rules, part 7404.0400, the department ~~shall~~ must provide and maintain photo identification equipment without additional cost to a newly appointed agent in that office if the office was provided the equipment by the department before January 1, 2000. All photo identification equipment must be compatible with standards established by the department.

(d) A filing fee retained by the agent employed by a county board must be paid into the county treasury and credited to the general revenue fund of the county. An agent who is not an employee of the county ~~shall~~ must retain the filing fee in lieu of county employment or salary and is considered an independent contractor for pension purposes, coverage under the Minnesota State Retirement System, or membership in the Public Employees Retirement Association.

(e) Before the end of the first working day following the final day of the reporting period established by the department, the agent must forward to the department all applications and fees collected during the reporting period except as provided in paragraph (d).

EFFECTIVE DATE. This section is effective August 1, 2022, and applies to applications made on or after that date.

Sec. 12. Minnesota Statutes 2020, section 171.0705, is amended by adding a subdivision to read:

Subd. 11. Manual and study material availability. The commissioner must publish the driver's manual on the department's website. The commissioner must also publish study support materials for the written exam and skills exam, with a focus on the subjects and skills that are most commonly failed by exam takers. The commissioner must ensure that the driver's manual and study support materials are easily located and available for no cost.

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Sec. 13. Minnesota Statutes 2020, section 171.12, subdivision 1a, is amended to read:

Subd. 1a. Driver and vehicle services information system; security and auditing. (a) The commissioner must establish written procedures to ensure that only individuals authorized by law may enter, update, or access not public data collected, created, or maintained by the driver and vehicle services information system. An authorized individual's ability to enter, update, or access data in the system must correspond to the official duties or training level of the individual and to the statutory authorization granting access for that purpose. All queries and responses, and all actions in which data are entered, updated, accessed, shared, or disseminated, must be recorded in a data audit trail. Data contained in the audit trail are public to the extent the data are not otherwise classified by law.

(b) The commissioner must not revoke the authorization of any individual who properly accessed data to complete an authorized transaction or to resolve an issue that does not result in a completed authorized transaction. The commissioner must immediately and permanently revoke the authorization of any individual who willfully entered, updated, accessed, shared, or disseminated data in violation of state or federal law. If an individual willfully gained access to data without authorization by law, the commissioner must forward the matter to the appropriate prosecuting authority for prosecution. The commissioner must establish a process that allows an individual whose access was revoked to appeal that decision.

(c) The commissioner must arrange for an independent biennial audit of the driver and vehicle services information system to determine whether data currently in the system are classified correctly, how the data are used, and to verify compliance with this subdivision. The results of the audit are public. No later than 30 days following completion of the audit, the commissioner must provide a report summarizing the audit results to the commissioner of administration; the chairs and ranking minority members of the committees of the house of representatives and the senate with jurisdiction over transportation policy and finance, public safety, and data practices; and the Legislative Commission on Data Practices and Personal Data Privacy. The report must be submitted as required under section 3.195, except that printed copies are not required.

Sec. 14. Minnesota Statutes 2021 Supplement, section 171.13, subdivision 1, is amended to read:

Subdivision 1. Examination subjects and locations; provisions for color blindness, disabled veterans. (a) Except as otherwise provided in this section, the commissioner ~~shall~~ must examine each applicant for a driver's license by such agency as the commissioner directs. This examination must include:

(1) a test of the applicant's eyesight, provided that this requirement is met by submission of a vision examination certificate under section 171.06, subdivision 7;

(2) a test of the applicant's ability to read and understand highway signs regulating, warning, and directing traffic;

(3) a test of the applicant's knowledge of (i) traffic laws; (ii) the effects of alcohol and drugs on a driver's ability to operate a motor vehicle safely and legally, and of the legal penalties and financial consequences resulting from violations of laws prohibiting the operation of a motor vehicle while under the influence of alcohol or drugs; (iii) railroad grade crossing safety; (iv) slow-moving vehicle safety; (v) laws relating to pupil transportation safety, including the significance of school bus lights, signals, stop arm, and passing a school bus; (vi) traffic laws related to bicycles; and (vii) the circumstances and dangers of carbon monoxide poisoning;

(4) an actual demonstration of ability to exercise ordinary and reasonable control in the operation of a motor vehicle; and

(5) other physical and mental examinations as the commissioner finds necessary to determine the applicant's fitness to operate a motor vehicle safely upon the highways.

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(b) Notwithstanding paragraph (a), the commissioner must not deny an application for a driver's license based on the exclusive grounds that the applicant's eyesight is deficient in color perception or that the applicant has been diagnosed with diabetes mellitus. War veterans operating motor vehicles especially equipped for disabled persons, if otherwise entitled to a license, must be granted such license.

(c) The commissioner ~~shall~~ must make provision for giving the examinations under this subdivision either in the county where the applicant resides or at a place adjacent thereto reasonably convenient to the applicant.

(d) The commissioner ~~shall~~ must ensure that an applicant is able to obtain an appointment for an examination to demonstrate ability under paragraph (a), clause (4), within 14 days of the applicant's request if, under the applicable statutes and rules of the commissioner, the applicant is eligible to take the examination.

(e) The commissioner must provide real-time information on the department's website about the availability and location of exam appointments. The website must show the next available exam dates and times for each exam station. The website must also provide an option for a person to enter an address to see the date and time of the next available exam at each exam station sorted by distance from the address provided. The information must be easily accessible and must not require a person to sign in or provide any other information, except an address, in order to see available exam dates.

Sec. 15. Minnesota Statutes 2020, section 171.13, subdivision 1a, is amended to read:

Subd. 1a. Waiver when license issued by another jurisdiction. (a) If the commissioner determines that an applicant 21 years of age or older possesses a valid driver's license issued by another state or jurisdiction that requires a comparable examination for obtaining a driver's license, the commissioner ~~may~~ must waive the ~~requirement~~ requirements that the applicant pass a written knowledge examination and demonstrate ability to exercise ordinary and reasonable control in the operation of a motor vehicle ~~on determining that the applicant possesses a valid driver's license issued by a jurisdiction that requires a comparable demonstration for license issuance~~.

(b) If the commissioner determines that an applicant 21 years of age or older possesses a valid driver's license with a two-wheeled vehicle endorsement issued by another state or jurisdiction that requires a comparable examination for obtaining the endorsement, the commissioner must waive the requirements that the applicant for a two-wheeled vehicle endorsement pass a written knowledge examination and demonstrate the ability to exercise ordinary and reasonable control in the operation of a motor vehicle.

(c) For purposes of this subdivision, "jurisdiction" includes, but is not limited to, both the active and reserve components of any branch or unit of the United States armed forces, and "valid driver's license" includes any driver's license that is recognized by that branch or unit as currently being valid, or as having been valid at the time of the applicant's separation or discharge from the military within a period of time deemed reasonable and fair by the commissioner, up to and including one year past the date of the applicant's separation or discharge.

EFFECTIVE DATE. This section is effective August 1, 2022, and applies to applications made on or after that date.

Sec. 16. Minnesota Statutes 2020, section 299A.705, is amended by adding a subdivision to read:

Subd. 3a. Full-service provider account. (a) The full-service provider account is created in the special revenue fund, consisting of fees described in sections 168.33, subdivision 7, and 171.06, subdivision 2, and any other money donated, allotted, transferred, or otherwise provided to the account.

(b) Money in the account is annually appropriated to the commissioner of public safety to distribute to full‑service providers, as defined in section 168.002, subdivision 12a. At least quarterly, the commissioner must distribute the money in the account to each full-service provider that was in operation during that quarter based proportionally on the number of transactions completed by each full-service provider.

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Sec. 17. REPORT; TRANSITION TO DIGITAL TITLES AND DRIVERS' LICENSES.

By December 15, 2022, the commissioner of public safety must report to the chairs and ranking minority members of the legislative committees with jurisdiction over transportation policy and finance on transitioning from physical driver and vehicle documents to digital versions of the same documents. At a minimum, the report must:

(1) include information on how other states have implemented the transition to digital documents;

(2) make recommendations on how to ensure the security, integrity, and privacy of data;

(3) include an estimate of the costs for transitioning to digital documents;

(4) include an estimated timeline for transitioning to digital documents; and

(5) identify statutory changes necessary to implement the transition to digital documents.

Sec. 18. EFFECTIVE DATE.

Except where otherwise specified, this article is effective August 1, 2022.

ARTICLE 5

SALVAGE AND PRIOR SALVAGE TITLE BRANDS

Section 1. Minnesota Statutes 2020, section 168A.01, is amended by adding a subdivision to read:

Subd. 16b. Recovered intact vehicle. "Recovered intact vehicle" means a vehicle that was:

(1) verified by the vehicle insurer to be stolen and declared a total loss; and

(2) subsequently recovered with damage that is not in excess of 80 percent of its value immediately before it was stolen.

Sec. 2. Minnesota Statutes 2020, section 168A.01, subdivision 17b, is amended to read:

Subd. 17b. Salvage vehicle. (a) "Salvage vehicle" means a vehicle ~~that has a salvage certificate of title~~ (1) for which an insurance company has declared a total loss or paid a total loss claim, or (2) that has been involved in a collision or other event in which the cost of repairs exceeds 80 percent of the value of the vehicle immediately before the damage occurred.

(b) Salvage vehicle does not include a recovered intact vehicle.

Sec. 3. Minnesota Statutes 2020, section 168A.04, subdivision 1, is amended to read:

Subdivision 1. Contents. The application for the first certificate of title of a vehicle or manufactured home in this state, or for reissuance of a certificate of title for a manufactured home under section 168A.142, ~~shall~~ must be made by the owner to the department on the form prescribed by the department and ~~shall~~ must contain:

(1) the first, middle, and last names, the dates of birth, and addresses of all owners who are natural persons, the full names and addresses of all other owners;

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(2) a description of the vehicle or manufactured home including, so far as the following data exists, its make, model, year, identifying number in the case of a vehicle or serial number in the case of a manufactured home, type of body, and whether new or used;

(3) the date of purchase by applicant, the name and address of the person from whom the vehicle or manufactured home was acquired, the names and addresses of any secured parties in the order of their priority, and the dates of their respective security agreements;

(4) with respect to motor vehicles subject to the provisions of section 325E.15, the true cumulative mileage registered on the odometer or that the actual mileage is unknown if the odometer reading is known by the owner to be different from the true mileage;

(5) ~~with respect to vehicles subject to section 325F.6641,~~ whether the vehicle sustained damage by collision or other occurrence ~~which exceeded 70 percent of the actual cash value~~ that meets the disclosure requirements under section 325F.6641, subdivision 1; and

(6) any further information the department reasonably requires to identify the vehicle or manufactured home and to enable it to determine whether the owner is entitled to a certificate of title, and the existence or nonexistence and priority of any security interest in the vehicle or manufactured home.

Sec. 4. Minnesota Statutes 2020, section 168A.04, subdivision 4, is amended to read:

Subd. 4. Vehicle last registered out of state. If the application refers to a vehicle last previously registered in another state or country, the application ~~shall~~ must contain or be accompanied by:

(1) any certificate of title issued by the other state or country;

(2) any other information and documents the department reasonably requires to establish the ownership of the vehicle and the existence or nonexistence and priority of any security interest in it;

(3) the certificate of a person authorized by the department that the identifying number of the vehicle has been inspected and found to conform to the description given in the application, or any other proof of the identity of the vehicle the department reasonably requires; and

(4) ~~with respect to vehicles subject to section 325F.6641,~~ whether the vehicle sustained damage by collision or other occurrence ~~which exceeded 70 percent of actual cash value~~ that meets the disclosure requirements under section 325F.6641, subdivision 1. Damage, for the purpose of ~~this~~ the calculation under this clause, does not include the actual cost incurred to repair, replace, or reinstall inflatable safety restraints and other vehicle components that must be replaced due to the deployment of the inflatable safety restraints.

Sec. 5. Minnesota Statutes 2020, section 168A.05, subdivision 3, is amended to read:

Subd. 3. Content of certificate. (a) Each certificate of title issued by the department ~~shall~~ must contain:

(1) the date issued;

(2) the first, middle, and last names and the dates of birth of all owners who are natural persons, and the full names of all other owners;

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(3) the residence address of the owner listed first if that owner is a natural person or the address if that owner is not a natural person;

(4) the names of any secured parties, and the address of the first secured party, listed in the order of priority (i) as shown on the application, or (ii) if the application is based on a certificate of title, as shown on the certificate, or (iii) as otherwise determined by the department;

(5) any liens filed pursuant to a court order or by a public agency responsible for child support enforcement against the owner;

(6) the title number assigned to the vehicle;

(7) a description of the vehicle including, so far as the following data exists, its make, model, year, identifying number, type of body, whether new or used, and if a new vehicle, the date of the first sale of the vehicle for use;

(8) with respect to a motor vehicle subject to section 325E.15, (i) the true cumulative mileage registered on the odometer or (ii) that the actual mileage is unknown if the odometer reading is known by the owner to be different from the true mileage;

(9) if applicable, one or more of the following:

(i) with respect to a vehicle subject to sections ~~325F.6641~~ 168A.151 and 325F.6642, the appropriate ~~term~~ brand "flood damaged," ~~"rebuilt,"~~ "salvage," "prior salvage," or "reconstructed";

~~(10)~~ (ii) with respect to a vehicle contaminated by methamphetamine production, if the registrar has received the certificate of title and notice described in section 152.0275, subdivision 2, paragraph (g), the ~~term~~ brand "hazardous waste contaminated vehicle"; and

~~(11)~~ (iii) with respect to a vehicle subject to section 325F.665, the ~~term~~ brand "lemon law vehicle"; and

~~(12)~~ (10) any other data the department prescribes.

(b) For a certificate of title on a vehicle that is a restored pioneer vehicle:

(1) the identifying number must be the valid identifying number as provided under section 168A.04, subdivision 5;

(2) the year of the vehicle must be the year of original vehicle manufacture and not the year of restoration; and

(3) the title must not bear a "reconstructed vehicle" brand.

Sec. 6. Minnesota Statutes 2020, section 168A.151, subdivision 1, is amended to read:

Subdivision 1. Salvage ~~titles~~ and prior salvage brands. (a) When an insurer, licensed to conduct business in Minnesota, acquires ownership of a ~~late-model or high-value~~ vehicle, excluding a recovered intact vehicle, through payment of damages, the insurer ~~shall~~ must:

(1) for a late-model or high-value vehicle, immediately apply for a ~~salvage~~ certificate of title that bears a "salvage" brand or ~~shall~~ stamp the existing certificate of title with ~~the legend~~ "~~SALVAGE~~ salvage ~~CERTIFICATE OF TITLE~~" in a manner prescribed by the department; or

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(2) for a vehicle that is not subject to clause (1), immediately apply for a certificate of title that bears a "prior salvage" brand or stamp the existing certificate of title with "prior salvage" in a manner prescribed by the department.

(b) Within ten days of obtaining the title of a vehicle through payment of damages, an insurer must notify the department in a manner prescribed by the department.

~~(b)~~ (c) Except as provided in section 168A.11, subdivision 1, a person ~~shall~~ must immediately apply for a ~~salvage~~ certificate of title that bears a "salvage" brand if the person acquires a damaged late-model or high-value vehicle ~~with an out-of-state title and the vehicle~~ that:

(1) ~~is a vehicle that~~ was acquired by an insurer through payment of damages;

(2) ~~is a vehicle for which the~~ will incur a cost of repairs that exceeds the value of the damaged vehicle; or

(3) has an out-of-state salvage certificate of title as proof of ownership.; or

(4) bears the brand "damaged," "repairable," "salvage," or any similar term on the certificate of title.

(d) Except as provided in section 168A.11, subdivision 1, a person must immediately apply for a certificate of title that bears a "prior salvage" brand if the person acquires a damaged vehicle and:

(1) a "salvage" brand is not required under paragraph (c); and

(2) the vehicle:

(i) bears the brand "damaged," "repairable," "salvage," "rebuilt," "reconditioned," or any similar term on the certificate of title; or

(ii) had a salvage certificate of title or brand issued at any time in the vehicle's history by any other jurisdiction.

~~(c)~~ (e) A self-insured owner of a ~~late-model or high-value~~ vehicle that sustains damage by collision or other occurrence which exceeds 80 percent of its actual cash value ~~shall~~ must:

(1) for a late-model or high-value vehicle, immediately apply for a ~~salvage~~ certificate of title. that bears a "salvage" brand; or

(2) for a vehicle that is not subject to clause (1), immediately apply for a certificate of title that bears a "prior salvage" brand.

Sec. 7. Minnesota Statutes 2020, section 168A.152, subdivision 1, is amended to read:

Subdivision 1. Certificate of inspection. (a) A ~~salvage~~ certificate of title that bears a "salvage" brand or stamp authorizes the holder to possess, transport, and transfer ownership in a vehicle. A ~~salvage~~ certificate of title that bears a "salvage" brand or stamp does not authorize the holder to register a vehicle. ~~A certificate of title must not be issued for a vehicle for which a salvage certificate of title has been issued unless~~

(b) For a late-model or high-value vehicle with a certificate of title that bears a "salvage" brand or stamp, the commissioner must not issue a certificate of title that bears a "prior salvage" brand unless the application for title is accompanied by a certification of inspection in the form and content specified by the department ~~accompanies the application for a certificate of title~~.

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Sec. 8. Minnesota Statutes 2020, section 168A.152, subdivision 1a, is amended to read:

Subd. 1a. Duties of salvage vehicle purchaser. No salvage vehicle purchaser shall possess or retain a salvage vehicle which does not have a ~~salvage~~ certificate of title that bears a "salvage" or "prior salvage" brand. The salvage vehicle purchaser ~~shall~~ must display the ~~salvage~~ certificate of title upon the request of any appropriate public authority.

Sec. 9. Minnesota Statutes 2020, section 325F.662, subdivision 3, is amended to read:

Subd. 3. Exclusions. Notwithstanding the provisions of subdivision 2, a dealer is not required to provide an express warranty for a used motor vehicle:

(1) sold for a total cash sale price of less than $3,000, including the trade-in value of any vehicle traded in by the consumer, but excluding tax, license fees, registration fees, and finance charges;

(2) with an engine designed to use diesel fuel;

(3) with a gross weight, as defined in section 168.002, subdivision 13, in excess of 9,000 pounds;

(4) that has been custom-built or modified for show or for racing;

(5) that is eight years of age or older, as calculated from the first day in January of the designated model year of the vehicle;

(6) that has been produced by a manufacturer which has never manufactured more than 10,000 motor vehicles in any one year;

(7) that has 75,000 miles or more at time of sale;

(8) that has not been manufactured in compliance with applicable federal emission standards in force at the time of manufacture as provided by the Clean Air Act, United States Code, title 42, sections 7401 through 7642, and regulations adopted pursuant thereto, and safety standards as provided by the National Traffic and Motor Safety Act, United States Code, title 15, sections 1381 through 1431, and regulations adopted pursuant thereto; or

(9) that has been issued a ~~salvage~~ certificate of title that bears a "salvage" brand or stamp under section 168A.151.

Sec. 10. Minnesota Statutes 2020, section 325F.6641, is amended to read:

325F.6641 DISCLOSURE OF VEHICLE DAMAGE.

Subdivision 1. Prior damage disclosure. (a) If a ~~late-model~~ vehicle~~, as defined in section 168A.01, subdivision 8a,~~ has sustained damage by collision or other occurrence which exceeds 80 percent of its actual cash value immediately prior to sustaining damage, the seller must disclose that fact to the buyer, if the seller has actual knowledge of the damage. The amount of damage is determined by the retail cost of repairing the vehicle based on a complete written retail repair estimate or invoice.

(b) The disclosure required under this subdivision must be made in writing on the application for title and registration or other transfer document, in a manner prescribed by the registrar of motor vehicles. The registrar ~~shall revise~~ must design the certificate of title form, including the assignment by seller (transferor) and reassignment by licensed dealer sections of the form, the separate application for title forms, and other transfer documents to accommodate this disclosure. If the seller is a motor vehicle dealer licensed pursuant to section 168.27, the disclosure required by this section must be made orally by the dealer to the prospective buyer in the course of the sales presentation.

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(c) Upon transfer and application for title to a vehicle covered by this subdivision, the registrar shall record the term "rebuilt" on the first Minnesota certificate of title and all subsequent Minnesota certificates of title used for that vehicle.

Subd. 2. ~~Form of~~ Disclosure requirements. (a) If a motor vehicle dealer licensed under section 168.27 offers a vehicle for sale in the course of a sales presentation to any prospective buyer the dealer must provide a written disclosure and, except for sales performed online, an oral disclosure of:

(1) prior vehicle damage as required under subdivision 1;

(2) the existence or requirement of any title brand under sections 168A.05, subdivision 3, 168A.151, 325F.6642, or 325F.665, subdivision 14, if the dealer has actual knowledge of the brand; and

(3) if a motor vehicle, which is part of a licensed motor vehicle dealer's inventory, has been submerged or flooded above the bottom dashboard while parked on the dealer's lot.

(b) If a person receives a flood disclosure as described in paragraph (a), clause (3), whether from a motor vehicle dealer or another seller, and subsequently offers that vehicle for sale, the person must provide the same disclosure to any prospective subsequent buyer.

(c) Written disclosure under this subdivision must be signed by the buyer and maintained in the motor vehicle dealer's sales file in the manner prescribed by the registrar of motor vehicles.

(d) The disclosure required in ~~this section~~ subdivision 1 must be made in substantially the following form: "To the best of my knowledge, this vehicle has ..... has not ..... sustained damage in excess of 80 percent actual cash value."

Sec. 11. Minnesota Statutes 2020, section 325F.6642, is amended to read:

325F.6642 TITLE BRANDING.

Subdivision 1. Flood damage. If the application for title and registration indicates that the vehicle has been classified as a total loss ~~vehicle~~ because of water or flood damage, or that the vehicle bears a "flood damaged" or similar brand, the registrar of motor vehicles ~~shall~~ must record the ~~term~~ brand "flood damaged" on the certificate of title and all subsequent certificates of title issued for that vehicle.

Subd. 2. ~~Total loss~~ Salvage vehicles. (a) Upon transfer and application for title to all ~~total loss~~ vehicles for which the "salvage" brand is required under section 168A.151, subdivision 1, the registrar of motor vehicles ~~shall~~ must (1) record the ~~term~~ brand "~~prior~~ salvage" on the first ~~Minnesota~~ certificate of title, and (2) subject to section 168A.152, record the brand "prior salvage" on all subsequent ~~Minnesota~~ certificates of title ~~used~~ issued for that vehicle.

(b) Notwithstanding paragraph (a), a "prior salvage" brand is not required for a recovered intact vehicle, as defined in section 168A.01, subdivision 16b.

~~Subd. 3.~~ ~~Out-of-state vehicles.~~ (a) Upon transfer and application for title of all repaired vehicles with out‑of‑state titles that bear the term "damaged," "salvage," "rebuilt," "reconditioned," or any similar term, the registrar of motor vehicles shall record the term "prior salvage" on the first Minnesota certificate of title and all subsequent Minnesota certificates of title used for that vehicle.

(b) The registrar shall mark "prior salvage" on the first Minnesota certificate of title and all subsequent certificates of title issued for any vehicle which came into the state unrepaired and for which a salvage certificate of title was issued.

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(c) For vehicles with out-of-state titles which bear the term "flood damaged," the registrar of motor vehicles shall record the term "flood damaged" on the first Minnesota certificate of title and all subsequent Minnesota certificates of title issued for that vehicle.

(d) the registrar shall mark "prior salvage" on the first Minnesota certificate of title and all subsequent certificates of title issued for any vehicle that had a salvage certificate of title issued at any time in the vehicle's history by any other jurisdiction.

Subd. 2a. Prior salvage. Upon application for title to all vehicles for which the "prior salvage" brand is required under section 168A.151, subdivision 1, the registrar of motor vehicles must record the brand "prior salvage" on the certificate of title and all subsequent certificates of title issued for that vehicle.

Subd. 2b. Certain damaged vehicles. Upon transfer and application for title to a vehicle that is subject to section 325F.6641, subdivision 1, the registrar of motor vehicles must (1) record the brand "salvage" on the first certificate of title, and (2) subject to section 168A.152, record the brand "prior salvage" on all subsequent certificates of title issued for that vehicle.

Subd. 4. Reconstructed vehicles. For vehicles that are reconstructed within the meaning of section 168A.15, the registrar ~~shall~~ must record the ~~term~~ brand "reconstructed" on the certificate of title and all subsequent certificates of title.

Subd. 5. Manner of branding. ~~The~~ Each brand designation ~~of "flood damaged," "rebuilt," "prior salvage," or "reconstructed"~~ under this section or section 168A.05, subdivision 3, 168A.151, or 325F.665, subdivision 14, required on a certificate of title ~~shall~~ must be made by the registrar of motor vehicles in a clear and conspicuous manner, in a ~~color~~ format different from all other writing on the certificate of title.

~~Subd. 6.~~ ~~Total loss vehicle; definition.~~ For the purposes of this section, "total loss vehicle" means a vehicle damaged by collision or other occurrence, for which a salvage certificate of title has been issued. Total loss vehicle does not include a stolen and recovered vehicle verified by the insurer who declared the vehicle to be a total loss vehicle unless there is more than minimal damage to the vehicle as determined by the registrar.

~~Subd. 7.~~ ~~Dealer disclosure.~~ ~~If a licensed motor vehicle dealer offers for sale a vehicle with a branded title, the dealer shall orally disclose the existence of the brand in the course of the sales presentation.~~

~~Subd. 8.~~ ~~Flood damage; dealer lots.~~ If a motor vehicle, which is part of a licensed motor vehicle dealer's inventory, has been submerged or flooded above the bottom of the dashboard while parked on the dealer's lot, the dealer must disclose that fact in writing to any buyer and must orally disclose that fact in the course of a sales presentation to any prospective buyer. The buyer must also disclose the existence of the flood damage in writing to any subsequent buyer.

Sec. 12. Minnesota Statutes 2020, section 325F.665, subdivision 14, is amended to read:

Subd. 14. Title branding. (a) Upon transfer and application for title of all vehicles subject to this section, the registrar of motor vehicles shall record the term "lemon law vehicle" on the certificate of title and all subsequent certificates of title for that vehicle.

(b) For vehicles with out-of-state titles that bear the term "lemon law vehicle," or any similar term, the registrar of motor vehicles shall record the term "lemon law vehicle" on the first Minnesota certificate of title and all subsequent Minnesota certificates of title issued for that vehicle.

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(c) The designation of "lemon law vehicle" on a certificate of title must be made by the registrar of motor vehicles in a clear and conspicuous manner, in a color different from all other writing on the certificate of title.

Sec. 13. REPEALER.

Minnesota Statutes 2020, sections 168A.01, subdivision 17a; and 325F.6644, are repealed.

Sec. 14. EFFECTIVE DATE.

Unless specified otherwise, this article is effective January 1, 2023."

Delete the title and insert:

"A bill for an act relating to transportation; providing supplemental appropriations for various transportation‑related purposes to the Department of Transportation, Metropolitan Council, and Department of Public Safety; providing for allocation of federal transportation-related funds; providing various policy changes to transportation-related provisions; establishing the Traffic Safety Advisory Council; establishing a working group and a task force; establishing administrative citations and a fine; requiring reports; authorizing the sale and issuance of state bonds; amending Minnesota Statutes 2020, sections 4.075, by adding subdivisions; 160.08, subdivision 7; 160.266, by adding a subdivision; 161.088, subdivisions 1, 2, 4, 5, as amended, by adding a subdivision; 161.115, by adding a subdivision; 161.14, by adding subdivisions; 162.07, subdivision 2; 162.13, subdivisions 2, 3; 168.002, by adding a subdivision; 168.1235, subdivision 1; 168.1253, subdivision 3; 168.27, subdivision 11; 168.327, subdivisions 2, 3; 168.33, subdivision 7; 168.345; 168A.01, subdivision 17b, by adding a subdivision; 168A.04, subdivisions 1, 4; 168A.05, subdivision 3; 168A.11, subdivision 3; 168A.151, subdivision 1; 168A.152, subdivisions 1, 1a; 168B.07, subdivision 3, by adding subdivisions; 169.14, by adding a subdivision; 169.18, subdivision 3; 169.8261; 171.01, by adding a subdivision; 171.06, subdivision 2, by adding a subdivision; 171.061, subdivision 4; 171.0705, by adding a subdivision; 171.12, subdivision 1a; 171.13, subdivision 1a; 174.52, subdivision 3; 216D.03, by adding a subdivision; 219.1651; 221.025; 299A.41, subdivision 3; 299A.705, by adding a subdivision; 299D.03, subdivision 5; 299F.60, subdivision 1; 299J.16, subdivision 1; 325F.662, subdivision 3; 325F.6641; 325F.6642; 325F.665, subdivision 14; 473.375, by adding a subdivision; 609.855, subdivisions 1, 7; Minnesota Statutes 2021 Supplement, sections 168.327, subdivision 1; 169.09, subdivision 13; 169.222, subdivision 4; 169A.60, subdivision 13; 171.0605, subdivision 5; 171.13, subdivision 1; 171.306, subdivision 4; 360.55, subdivision 9; 360.59, subdivision 10; Laws 2021, First Special Session chapter 5, article 1, section 4, subdivision 3; article 2, section 2, subdivision 1; proposing coding for new law in Minnesota Statutes, chapters 160; 161; 169; 174; 473; repealing Minnesota Statutes 2020, sections 168A.01, subdivision 17a; 325F.6644; Minnesota Rules, part 8835.0350, subpart 2."

With the recommendation that when so amended the bill be re-referred to the Committee on Ways and Means.

The report was adopted.

Marquart from the Committee on Taxes to which was referred:

H. F. No. 3669, A bill for an act relating to taxation; modifying individual income and corporate franchise taxes, sales taxes, property taxes, local government aids, and other miscellaneous taxes and tax provisions; proposing certain federal conformity for individual income and corporate franchise taxes; modifying and expanding certain income tax credits; proposing new sales tax construction exemptions for certain entities; modifying eligibility for certain property tax programs; proposing public safety aid and soil and water conservation district aid for local governments; proposing onetime direct payments to taxpayers; appropriating money; amending Minnesota Statutes

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2020, sections 273.124, subdivisions 6, 13a, 13c, 13d; 273.1245, subdivision 1; 273.1315, subdivision 2; 289A.02, subdivision 7; 290.0123, subdivision 3; 290.0131, by adding subdivisions; 290.0132, subdivision 18, by adding subdivisions; 290.0133, by adding subdivisions; 290.0134, by adding subdivisions; 290.067, subdivisions 1, 2b, by adding a subdivision; 290.0671, subdivision 1a; 290.0674, subdivisions 2, 2a, by adding a subdivision; 290.0675, subdivision 1; 290.091, subdivision 2; 290.095, subdivision 11; 290A.03, subdivision 15; 290B.03, subdivision 1; 290B.04, subdivisions 3, 4; 290B.05, subdivision 1; 291.005, subdivision 1; 297A.71, by adding a subdivision; Minnesota Statutes 2021 Supplement, sections 116J.8737, subdivisions 5, 12; 273.124, subdivisions 13, 14; 273.13, subdivision 23; 289A.08, subdivision 7; 290.01, subdivisions 19, 31; 290.06, subdivision 2c; 290.0671, subdivision 1; 290.993; 297A.75, subdivisions 1, 2, 3; Laws 2021, First Special Session chapter 1, article 2, section 6; proposing coding for new law in Minnesota Statutes, chapter 477A.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

"ARTICLE 1

FEDERAL CONFORMITY

Section 1. Minnesota Statutes 2020, section 289A.02, subdivision 7, is amended to read:

Subd. 7. Internal Revenue Code. Unless specifically defined otherwise, "Internal Revenue Code" means the Internal Revenue Code of 1986, as amended through ~~December 31, 2018~~ November 15, 2021.

EFFECTIVE DATE. This section is effective the day following final enactment, except the changes incorporated by federal changes are effective retroactively at the same time the changes were effective for federal purposes.

Sec. 2. Minnesota Statutes 2021 Supplement, section 289A.08, subdivision 7, is amended to read:

Subd. 7. Composite income tax returns for nonresident partners, shareholders, and beneficiaries. (a) The commissioner may allow a partnership with nonresident partners to file a composite return and to pay the tax on behalf of nonresident partners who have no other Minnesota source income. This composite return must include the names, addresses, Social Security numbers, income allocation, and tax liability for the nonresident partners electing to be covered by the composite return.

(b) The computation of a partner's tax liability must be determined by multiplying the income allocated to that partner by the highest rate used to determine the tax liability for individuals under section 290.06, subdivision 2c. Nonbusiness deductions, standard deductions, or personal exemptions are not allowed.

(c) The partnership must submit a request to use this composite return filing method for nonresident partners. The requesting partnership must file a composite return in the form prescribed by the commissioner of revenue. The filing of a composite return is considered a request to use the composite return filing method.

(d) The electing partner must not have any Minnesota source income other than the income from the partnership, other electing partnerships, and other qualifying entities electing to file and pay the pass-through entity tax under subdivision 7a. If it is determined that the electing partner has other Minnesota source income, the inclusion of the income and tax liability for that partner under this provision will not constitute a return to satisfy the requirements of subdivision 1. The tax paid for the individual as part of the composite return is allowed as a payment of the tax by the individual on the date on which the composite return payment was made. If the electing nonresident partner has no other Minnesota source income, filing of the composite return is a return for purposes of subdivision 1.

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(e) This subdivision does not negate the requirement that an individual pay estimated tax if the individual's liability would exceed the requirements set forth in section 289A.25. The individual's liability to pay estimated tax is, however, satisfied when the partnership pays composite estimated tax in the manner prescribed in section 289A.25.

(f) If an electing partner's share of the partnership's gross income from Minnesota sources is less than the filing requirements for a nonresident under this subdivision, the tax liability is zero. However, a statement showing the partner's share of gross income must be included as part of the composite return.

(g) The election provided in this subdivision is only available to a partner who has no other Minnesota source income and who is either (1) a full-year nonresident individual or (2) a trust or estate that does not claim a deduction under either section 651 or 661 of the Internal Revenue Code.

(h) A corporation defined in section 290.9725 and its nonresident shareholders may make an election under this paragraph. The provisions covering the partnership apply to the corporation and the provisions applying to the partner apply to the shareholder.

(i) Estates and trusts distributing current income only and the nonresident individual beneficiaries of the estates or trusts may make an election under this paragraph. The provisions covering the partnership apply to the estate or trust. The provisions applying to the partner apply to the beneficiary.

(j) For the purposes of this subdivision, "income" means the partner's share of federal adjusted gross income from the partnership modified by the additions provided in section 290.0131, subdivisions 8 to 10, 16, ~~and~~ 17, and 19, and the subtractions provided in: (1) section 290.0132, subdivisions 9, 27, and 28, to the extent the amount is assignable or allocable to Minnesota under section 290.17; and (2) section 290.0132, ~~subdivision~~ subdivisions 14 and 31. The subtraction allowed under section 290.0132, subdivision 9, is only allowed on the composite tax computation to the extent the electing partner would have been allowed the subtraction.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

Sec. 3. Minnesota Statutes 2021 Supplement, section 290.01, subdivision 19, is amended to read:

Subd. 19. Net income. (a) For a trust or estate taxable under section 290.03, and a corporation taxable under section 290.02, the term "net income" means the federal taxable income, as defined in section 63 of the Internal Revenue Code of 1986, as amended through the date named in this subdivision, incorporating the federal effective dates of changes to the Internal Revenue Code and any elections made by the taxpayer in accordance with the Internal Revenue Code in determining federal taxable income for federal income tax purposes, and with the modifications provided in sections 290.0131 to 290.0136.

(b) For an individual, the term "net income" means federal adjusted gross income with the modifications provided in sections 290.0131, 290.0132, and 290.0135 to 290.0137.

(c) In the case of a regulated investment company or a fund thereof, as defined in section 851(a) or 851(g) of the Internal Revenue Code, federal taxable income means investment company taxable income as defined in section 852(b)(2) of the Internal Revenue Code, except that:

(1) the exclusion of net capital gain provided in section 852(b)(2)(A) of the Internal Revenue Code does not apply;

(2) the deduction for dividends paid under section 852(b)(2)(D) of the Internal Revenue Code must be applied by allowing a deduction for capital gain dividends and exempt-interest dividends as defined in sections 852(b)(3)(C) and 852(b)(5) of the Internal Revenue Code; and

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(3) the deduction for dividends paid must also be applied in the amount of any undistributed capital gains which the regulated investment company elects to have treated as provided in section 852(b)(3)(D) of the Internal Revenue Code.

(d) The net income of a real estate investment trust as defined and limited by section 856(a), (b), and (c) of the Internal Revenue Code means the real estate investment trust taxable income as defined in section 857(b)(2) of the Internal Revenue Code.

(e) The net income of a designated settlement fund as defined in section 468B(d) of the Internal Revenue Code means the gross income as defined in section 468B(b) of the Internal Revenue Code.

(f) The Internal Revenue Code of 1986, as amended through ~~December 31, 2018~~ November 15, 2021, applies for taxable years beginning after December 31, 1996~~, except the sections of federal law in section 290.0111 shall also apply~~.

(g) Except as otherwise provided, references to the Internal Revenue Code in this subdivision and sections 290.0131 to 290.0136 mean the code in effect for purposes of determining net income for the applicable year.

Sec. 4. Minnesota Statutes 2021 Supplement, section 290.01, subdivision 31, is amended to read:

Subd. 31. Internal Revenue Code. Unless specifically defined otherwise, "Internal Revenue Code" means the Internal Revenue Code of 1986, as amended through ~~December 31, 2018, except the sections of federal law in section 290.0111 shall also apply~~ November 15, 2021. Internal Revenue Code also includes any uncodified provision in federal law that relates to provisions of the Internal Revenue Code that are incorporated into Minnesota law.

Sec. 5. Minnesota Statutes 2020, section 290.0131, is amended by adding a subdivision to read:

Subd. 19. Meal expenses. The amount of meal expenses in excess of the 50 percent limitation under section 274(n)(1) of the Internal Revenue Code allowed under subsection (n), paragraph (2), subparagraph (D), of that section is an addition.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

Sec. 6. Minnesota Statutes 2020, section 290.0132, subdivision 18, is amended to read:

Subd. 18. Net operating losses. (a) The amount of the net operating loss allowed under section 290.095, subdivision 11, paragraph (c), is a subtraction.

(b) The unused portion of a net operating loss carryover under section 290.095, subdivision 11, paragraph (d), is a subtraction. The subtraction is the lesser of:

(1) the amount carried into the taxable year minus any subtraction made under this section for prior taxable years; or

(2) 80 percent of Minnesota taxable net income in a single taxable year and determined without regard to this subtraction.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

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Sec. 7. Minnesota Statutes 2020, section 290.0132, is amended by adding a subdivision to read:

Subd. 31. Delayed business interest. (a) For each of the five taxable years beginning after December 31, 2021, there is allowed a subtraction equal to one-fifth of the adjustment amount, to the extent not already deducted, for the exclusion under section 16, subdivision 2, clause (10), due to the Coronavirus Aid, Relief and Economic Security Act, Public Law 116-136, section 2306.

(b) This subdivision expires for taxable years beginning after December 31, 2026.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

Sec. 8. Minnesota Statutes 2020, section 290.0133, is amended by adding a subdivision to read:

Subd. 15. Meal expenses. The amount of meal expenses in excess of the 50 percent limitation under section 274(n)(1) of the Internal Revenue Code allowed under section 274(n)(2)(D) of the Internal Revenue Code is an addition.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

Sec. 9. Minnesota Statutes 2020, section 290.0134, is amended by adding a subdivision to read:

Subd. 20. Delayed business interest. (a) For each of the five taxable years beginning after December 31, 2021, there is allowed a subtraction equal to one-fifth of the adjustment amount, to the extent not already deducted, for the exclusion under section 16, subdivision 2, clause (10), due to the Coronavirus Aid, Relief and Economic Security Act, Public Law 116-136, section 2306.

(b) This subdivision expires for taxable years beginning after December 31, 2026.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

Sec. 10. Minnesota Statutes 2021 Supplement, 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 $38,770, 5.35 percent;

(2) On all over $38,770, but not over $154,020, 6.8 percent;

(3) On all over $154,020, but not over $269,010, 7.85 percent;

(4) On all over $269,010, 9.85 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 after the adjustment required in subdivision 2d.

(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 $26,520, 5.35 percent;

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(2) On all over $26,520, but not over $87,110, 6.8 percent;

(3) On all over $87,110, but not over $161,720, 7.85 percent;

(4) On all over $161,720, 9.85 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 $32,650, 5.35 percent;

(2) On all over $32,650, but not over $131,190, 6.8 percent;

(3) On all over $131,190, but not over $214,980, 7.85 percent;

(4) On all over $214,980, 9.85 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:

(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:

(i) the additions required under sections 290.0131, subdivisions 2, 6, 8 to 10, 16, ~~and~~ 17, and 19, and 290.0137, paragraph (a); and reduced by

(ii) the Minnesota assignable portion of the subtraction for United States government interest under section 290.0132, subdivision 2, the subtractions under sections 290.0132, subdivisions 9, 10, 14, 15, 17, 18, ~~and~~ 27, and 31, and 290.0137, paragraph (c), 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, increased by:

(i) the additions required under sections 290.0131, subdivisions 2, 6, 8 to 10, 16, ~~and~~ 17, and 19, and 290.0137, paragraph (a); and reduced by

(ii) the subtractions under sections 290.0132, subdivisions 2, 9, 10, 14, 15, 17, 18, ~~and~~ 27, and 31, and 290.0137, paragraph (c).

(f) If an individual who is not a Minnesota resident for the entire year is a qualifying owner of a qualifying entity that elects to pay tax as provided in section 289A.08, subdivision 7a, paragraph (b), the individual must compute the individual's Minnesota income tax as provided in paragraph (e), and also must include, to the extent attributed to the electing qualifying entity:

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(1) in paragraph (e), clause (1), item (i), and paragraph (e), clause (2), item (i), the addition under section 290.0131, subdivision 5; and

(2) in paragraph (e), clause (1), item (ii), and paragraph (e), clause (2), item (ii), the subtraction under section 290.0132, subdivision 3.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

Sec. 11. Minnesota Statutes 2020, 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;

(ii) the medical expense deduction;

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

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

(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);

(5) to the extent not included in federal alternative minimum taxable income, the amount of interest income as provided by section 290.0131, subdivision 2;

(6) the amount of addition required by section 290.0131, subdivisions 9, 10, ~~and~~ 16, and 19;

(7) the deduction allowed under section 199A of the Internal Revenue Code, to the extent not included in the addition required under clause (6); and

(8) to the extent not included in federal alternative minimum taxable income, the amount of foreign-derived intangible income deducted under section 250 of the Internal Revenue Code;

less the sum of the amounts determined under the following:

(i) interest income as defined in section 290.0132, subdivision 2;

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(ii) an overpayment of state income tax as provided by section 290.0132, subdivision 3, to the extent included in federal alternative minimum taxable income;

(iii) 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;

(iv) amounts subtracted from federal taxable or adjusted gross income as provided by section 290.0132, subdivisions 7, 9 to 15, 17, 21, 24, and 26 to 29 33;

(v) the amount of the net operating loss allowed under section 290.095, subdivision 11, ~~paragraph~~ paragraphs (c) and (d); and

(vi) the amount allowable as a Minnesota itemized deduction under section 290.0122, subdivision 7.

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, except alternative minimum taxable income must be increased by the addition in section 290.0131, subdivision 16.

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

(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) "Tentative minimum tax" equals 6.75 percent of alternative minimum taxable income after subtracting the exemption amount determined under subdivision 3.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

Sec. 12. Minnesota Statutes 2020, section 290.095, subdivision 11, is amended to read:

Subd. 11. Carryback or carryover adjustments. (a) Except as provided in paragraph (c), for individuals, estates, and trusts the amount of a net operating loss that may be carried back or carried over shall be the same dollar amount allowable in the determination of federal taxable income, provided that, notwithstanding any other provision, estates and trusts must apply the following adjustments to the amount of the net operating loss that may be carried back or carried over:

(1) Nonassignable income or losses as required by section 290.17.

(2) Deductions not allocable to Minnesota under section 290.17.

(b) The net operating loss carryback or carryover applied as a deduction in the taxable year to which the net operating loss is carried back or carried over shall be equal to the net operating loss carryback or carryover applied in the taxable year in arriving at federal taxable income provided that trusts and estates must apply the following modifications:

(1) Increase the amount of carryback or carryover applied in the taxable year by the amount of losses and interest, taxes and other expenses not assignable or allowable to Minnesota incurred in the taxable year.

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(2) Decrease the amount of carryback or carryover applied in the taxable year by the amount of income not assignable to Minnesota earned in the taxable year. For estates and trusts, the net operating loss carryback or carryover to the next consecutive taxable year shall be the net operating loss carryback or carryover as calculated in clause (b) less the amount applied in the earlier taxable year(s). No additional net operating loss carryback or carryover shall be allowed to estates and trusts if the entire amount has been used to offset Minnesota income in a year earlier than was possible on the federal return. However, if a net operating loss carryback or carryover was allowed to offset federal income in a year earlier than was possible on the Minnesota return, an estate or trust shall still be allowed to offset Minnesota income but only if the loss was assignable to Minnesota in the year the loss occurred.

(c) This paragraph does not apply to eligible small businesses that make a valid election to carry back their losses for federal purposes under section 172(b)(1)(H) of the Internal Revenue Code as amended through March 31, 2009.

(1) A net operating loss of an individual, estate, or trust that is allowed under this subdivision and for which the taxpayer elects to carry back for more than two years under section 172(b)(1)(H) of the Internal Revenue Code is a net operating loss carryback to each of the two taxable years preceding the loss, and unused portions may be carried forward for 20 taxable years after the loss.

(2) The entire amount of the net operating loss for any taxable year must be carried to the earliest of the taxable years to which the loss may be carried. The portion of the loss which may be carried to each of the other taxable years is the excess, if any, of the amount of the loss over the greater of the taxable net income or alternative minimum taxable income for each of the taxable years to which the loss may be carried.

(d) For net operating loss carryovers or carrybacks arising in taxable years beginning after December 31, 2017, and before December 31, 2020, a net operating loss carryover or carryback is allowed as provided in the Internal Revenue Code as amended through December 31, 2018, as follows:

(1) the entire amount of the net operating loss, to the extent not already deducted, must be carried to the earliest taxable year and any unused portion may be carried forward for 20 taxable years after the loss; and

(2) the portion of the loss which may be carried to each of the other taxable years is the excess, if any, of the amount of the loss over the greater of the taxable net income or alternative minimum taxable income for each of the taxable years to which the loss may be carried.

EFFECTIVE DATE. This section is effective retroactively for taxable years beginning after December 31, 2017, and before December 31, 2020.

Sec. 13. Minnesota Statutes 2021 Supplement, section 290.993, is amended to read:

290.993 SPECIAL LIMITED ADJUSTMENT.

Subdivision 1. Tax year 2018. (a) For an individual, estate, or trust, or a partnership that elects to file a composite return under section 289A.08, subdivision 7, for taxable years beginning after December 31, 2017, and before January 1, 2019, the following special rules apply:

(1) an individual income taxpayer may: (i) take the standard deduction; or (ii) make an election under section 63(e) of the Internal Revenue Code to itemize, for Minnesota individual income tax purposes, regardless of the choice made on their federal return; and

(2) there is an adjustment to tax equal to the difference between the tax calculated under this chapter using the Internal Revenue Code as amended through December 16, 2016, and the tax calculated under this chapter using the Internal Revenue Code amended through December 31, 2018, before the application of credits. The end result must be zero additional tax due or refund.

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(b) The adjustment in ~~paragraph (a), clause (2),~~ this subdivision does not apply to any changes due to sections 11012, 13101, 13201, 13202, 13203, 13204, 13205, 13207, 13301, 13302, 13303, 13313, 13502, 13503, 13801, 14101, 14102, 14211 through 14215, and 14501 of Public Law 115-97; and section 40411 of Public Law 115-123.

Subd. 2. Tax years prior to 2022. (a) For all taxpayers, including an entity that elects to file a composite return under section 289A.08, subdivision 7, and an entity that elects to pay the pass-through entity tax under section 289A.08, subdivision 7a, for taxable years beginning after December 31, 2016, and before January 1, 2022, the provisions in this subdivision apply.

(b) There is an adjustment to tax equal to the difference between the amount calculated and reported under this chapter incorporating the Internal Revenue Code as amended through Laws 2021, First Special Session chapter 14, and the amount calculated under this chapter incorporating the Internal Revenue Code as amended through November 15, 2021. For taxable years beginning before January 1, 2022, the end result of incorporating the Internal Revenue Code as amended through November 15, 2021, must be zero additional tax due or refund, except as provided in paragraph (c).

(1) the Taxpayer Certainty and Disaster Relief Act of 2020, Public Law 116-260, section 114, exclusion of gross income of discharge of qualified principal residence indebtedness;

(2) the Taxpayer Certainty and Disaster Relief Act of 2020, Public Law 116-260, section 304(b), special rules for disaster-related personal casualty losses;

(3) the COVID-related Tax Relief Act of 2020, Public Law 116-260, section 278, paragraphs (a) and (d), clarification of tax treatment of certain loan forgiveness and other business financial assistance;

(4) the American Rescue Plan Act, Public Law 117-2, section 9672, tax treatment of targeted EIDL advances;

(5) the American Rescue Plan Act, Public Law 117-2, section 9673, tax treatment of restaurant revitalization grants; and

(6) the American Rescue Plan Act, Public Law 117-2, section 9675, modification of treatment of student loan forgiveness.

EFFECTIVE DATE. This section is effective retroactively for taxable years beginning before January 1, 2022.

Sec. 14. Minnesota Statutes 2020, section 290A.03, subdivision 15, is amended to read:

Subd. 15. Internal Revenue Code. "Internal Revenue Code" means the Internal Revenue Code of 1986, as amended through ~~December 31, 2018~~ November 15, 2021.

EFFECTIVE DATE. This section is effective for property tax refunds based on property taxes payable in 2023 and rent paid in 2022 and thereafter.

Sec. 15. Minnesota Statutes 2020, section 291.005, subdivision 1, is amended to read:

Subdivision 1. Scope. Unless the context otherwise clearly requires, the following terms used in this chapter shall have the following meanings:

(1) "Commissioner" means the commissioner of revenue or any person to whom the commissioner has delegated functions under this chapter.

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(2) "Federal gross estate" means the gross estate of a decedent as required to be valued and otherwise determined for federal estate tax purposes under the Internal Revenue Code, increased by the value of any property in which the decedent had a qualifying income interest for life and for which an election was made under section 291.03, subdivision 1d, for Minnesota estate tax purposes, but was not made for federal estate tax purposes.

(3) "Internal Revenue Code" means the United States Internal Revenue Code of 1986, as amended through ~~December 31, 2018~~ November 15, 2021.

(4) "Minnesota gross estate" means the federal gross estate of a decedent after (a) excluding therefrom any property included in the estate which has its situs outside Minnesota, and (b) including any property omitted from the federal gross estate which is includable in the estate, has its situs in Minnesota, and was not disclosed to federal taxing authorities.

(5) "Nonresident decedent" means an individual whose domicile at the time of death was not in Minnesota.

(6) "Personal representative" means the executor, administrator or other person appointed by the court to administer and dispose of the property of the decedent. If there is no executor, administrator or other person appointed, qualified, and acting within this state, then any person in actual or constructive possession of any property having a situs in this state which is included in the federal gross estate of the decedent shall be deemed to be a personal representative to the extent of the property and the Minnesota estate tax due with respect to the property.

(7) "Resident decedent" means an individual whose domicile at the time of death was in Minnesota. The provisions of section 290.01, subdivision 7, paragraphs (c) and (d), apply to determinations of domicile under this chapter.

(8) "Situs of property" means, with respect to:

(i) real property, the state or country in which it is located;

(ii) tangible personal property, the state or country in which it was normally kept or located at the time of the decedent's death or for a gift of tangible personal property within three years of death, the state or country in which it was normally kept or located when the gift was executed;

(iii) a qualified work of art, as defined in section 2503(g)(2) of the Internal Revenue Code, owned by a nonresident decedent and that is normally kept or located in this state because it is on loan to an organization, qualifying as exempt from taxation under section 501(c)(3) of the Internal Revenue Code, that is located in Minnesota, the situs of the art is deemed to be outside of Minnesota, notwithstanding the provisions of item (ii); and

(iv) intangible personal property, the state or country in which the decedent was domiciled at death or for a gift of intangible personal property within three years of death, the state or country in which the decedent was domiciled when the gift was executed.

For a nonresident decedent with an ownership interest in a pass-through entity with assets that include real or tangible personal property, situs of the real or tangible personal property, including qualified works of art, is determined as if the pass-through entity does not exist and the real or tangible personal property is personally owned by the decedent. If the pass-through entity is owned by a person or persons in addition to the decedent, ownership of the property is attributed to the decedent in proportion to the decedent's capital ownership share of the pass-through entity.

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(9) "Pass-through entity" includes the following:

(i) an entity electing S corporation status under section 1362 of the Internal Revenue Code;

(ii) an entity taxed as a partnership under subchapter K of the Internal Revenue Code;

(iii) a single-member limited liability company or similar entity, regardless of whether it is taxed as an association or is disregarded for federal income tax purposes under Code of Federal Regulations, title 26, section 301.7701-3; or

(iv) a trust to the extent the property is includable in the decedent's federal gross estate; but excludes

(v) an entity whose ownership interest securities are traded on an exchange regulated by the Securities and Exchange Commission as a national securities exchange under section 6 of the Securities Exchange Act, United States Code, title 15, section 78f.

Sec. 16. NONCONFORMITY ADJUSTMENT.

Subdivision 1. Definitions. (a) For the purposes of this section, the following terms have the meanings given.

(b) For an individual, estate, or trust:

(1) "subtraction" has the meaning given in Minnesota Statutes, section 290.0132, subdivision 1, and the rules in that subdivision apply for this section; and

(2) "addition" has the meaning given in Minnesota Statutes, section 290.0131, subdivision 1, and the rules in that subdivision apply for this section.

(1) "subtraction" has the meaning given in Minnesota Statutes, section 290.0134, subdivision 1, and the rules in that subdivision apply for this section; and

(2) "addition" has the meaning given in Minnesota Statutes, section 290.0133, subdivision 1, and the rules in that subdivision apply for this section.

(d) "Pass-through entity" means an entity that is not subject to the tax imposed under section 290.02, including but not limited to S corporations, partnerships, estates, and trusts other than grantor trusts.

(e) The definitions in Minnesota Statutes, section 290.01, apply for this section.

Subd. 2. Calculation of nonconformity adjustment A taxpayer's nonconformity adjustment equals the difference between adjusted gross income, as defined under section 62 of the Internal Revenue Code for individuals, and federal taxable income as defined under section 63 of the Internal Revenue Code for all other taxpayers incorporating the Internal Revenue Code as amended through Laws 2021, First Special Session chapter 14, and the

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amount calculated under this chapter incorporating the Internal Revenue Code as amended through November 15, 2021, but does not include impacts to state tax credits. The nonconformity adjustment is an addition or subtraction to net income but does not include the following federal law changes:

(1) Taxpayer Certainty and Disaster Tax Relief Act of 2019, Public Law 116-94, section 104, deduction of qualified tuition and related expenses;

(2) Taxpayer Certainty and Disaster Tax Relief Act of 2019, Public Law 116-94, section 203, employee retention credit for employers affected by qualified disasters;

(3) Families First Coronavirus Response Act, Public Law 116-127, section 7001, payroll credit for required paid sick leave;

(4) Families First Coronavirus Response Act, Public Law 116-127, section 7003, payroll credit for required paid family leave;

(5) Coronavirus Aid, Relief and Economic Security Act, Public Law 116-136, section 2204, allowance of partial above the line deduction for charitable contributions;

(6) Coronavirus Aid, Relief and Economic Security Act, Public Law 116-136, section 2205(a), modification of limitations on charitable contributions during 2020;

(7) Coronavirus Aid, Relief and Economic Security Act, Public Law 116-136, section 2301, employee retention credit for employers subject to closure due to COVID-19;

(8) Coronavirus Aid, Relief and Economic Security Act, Public Law 116-136, section 2303, modifications for net operating losses;

(9) Coronavirus Aid, Relief and Economic Security Act, Public Law 116-136, section 2304, modification of limitation on losses for taxpayers other than corporations;

(10) Coronavirus Aid, Relief and Economic Security Act, Public Law 116-136, section 2306, limitation on business interest;

(11) Taxpayer Certainty and Disaster Tax Relief Act of 2020, Public Law 116-260, section 207, extension and modification of employee retention and rehiring credit;

(12) Taxpayer Certainty and Disaster Tax Relief Act of 2020, Public Law 116-260, section 210, temporary allowance of full deduction for business meals;

(13) Taxpayer Certainty and Disaster Tax Relief Act of 2020, Public Law 116-260, section 212, certain charitable contributions by nonitemizers;

(14) Taxpayer Certainty and Disaster Tax Relief Act of 2020, Public Law 116-260, section 213, modification of limitations on charitable contributions;

(15) Taxpayer Certainty and Disaster Tax Relief Act of 2020, Public Law 116-260, section 303, employee retention credit for employers affected by qualified disasters;

(16) Taxpayer Certainty and Disaster Tax Relief Act of 2020, Public Law 116-260, section 304(a), special rules for qualified disaster relief contributions;

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(17) American Rescue Plan Act, Public Law 117-2, section 9501(b), preserving health benefits for workers;

(18) American Rescue Plan Act, Public Law 117-2, section 9631, refundability and enhancement of child and dependent care tax credit;

(19) American Rescue Plan Act, Public Law 117-2, section 9641, payroll sick and family leave credits;

(20) American Rescue Plan Act, Public Law 117-2, section 9651, extension of employee retention credit; and

(21) any changes excluded from the special limited adjustment under section 290.993, subdivision 2, paragraph (c).

Subd. 3. Timing of adjustment for pass-through entities. Partners, shareholders, or beneficiaries who file their returns on a calendar year basis, and who received an addition or subtraction from a pass-through entity filing their return on a fiscal year basis, must make the addition or subtraction under this section in the taxable year it is received as required for federal income tax purposes.

Subd. 4. Special limited adjustment addition; individuals, estates, and trusts. For an individual, estate, or trust, the amount of a nonconformity adjustment under subdivision 2 that increases net income for the taxable year is an addition.

Subd. 5. Special limited adjustment subtraction; individuals, estates, and trusts. For an individual, estate, or trust, the amount of a nonconformity adjustment under subdivision 2 that decreases net income for the taxable year is a subtraction.

Subd. 6. Special limited adjustment addition; C corporations. For a corporation other than an S corporation, the amount of a nonconformity adjustment under subdivision 2 that increases net income for the taxable year is an addition.

Subd. 7. Special limited adjustment subtraction; individuals, estates, and trusts. For a corporation other than an S corporation, the amount of a nonconformity adjustment under subdivision 2 that decreases net income for the taxable year is a subtraction.

Subd. 8. Nonresident apportionment; alternative minimum tax. (a) The commissioner of revenue must apply each of the subtractions and additions in this section when calculating the following amounts:

(1) the percentage under Minnesota Statutes, section 290.06, subdivision 2c, paragraph (e);

(2) a taxpayer's alternative minimum taxable income under Minnesota Statutes, section 290.091.

(b) The commissioner of revenue must consider each of the subtractions and additions in this section when calculating "income" as defined in Minnesota Statutes, section 289A.08.

EFFECTIVE DATE. (a) Subdivisions 1 to 7 are effective for taxable years beginning after December 31, 2021 and before January 1, 2023, except for a pass-through entity covered by subdivision 3, subdivisions 1 to 7 are effective retroactively for the taxable years the addition or subtraction is required in that subdivision.

(b) Subdivision 8 is effective retroactively for any taxable year in which a taxpayer had an addition or a subtraction under this section.

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Sec. 17. REPEALER.

Minnesota Statutes 2021 Supplement, section 290.0111, is repealed.

ARTICLE 2

INDIVIDUAL INCOME AND CORPORATE FRANCHISE TAXES

Section 1. Minnesota Statutes 2020, section 41B.0391, subdivision 1, is amended to read:

Subdivision 1. Definitions. (a) For purposes of this section, the following terms have the meanings given.

(b) "Agricultural assets" means agricultural land, livestock, facilities, buildings, and machinery used for farming in Minnesota.

(1) is a resident of Minnesota;

(2) is seeking entry, or has entered within the last ten years, into farming;

(3) intends to farm land located within the state borders of Minnesota;

(4) is not and whose spouse is not a family member of the owner of the agricultural assets from whom the beginning farmer is seeking to purchase or rent agricultural assets;

(5) is not and whose spouse is not a family member of a partner, member, shareholder, or trustee of the owner of agricultural assets from whom the beginning farmer is seeking to purchase or rent agricultural assets; and

(6) meets the following eligibility requirements as determined by the authority:

(i) has a net worth that does not exceed the limit provided under section 41B.03, subdivision 3, paragraph (a), clause (2);

(ii) provides the majority of the day-to-day physical labor and management of the farm;

(iii) has, by the judgment of the authority, adequate farming experience or demonstrates knowledge in the type of farming for which the beginning farmer seeks assistance from the authority;

(iv) demonstrates to the authority a profit potential by submitting projected earnings statements;

(v) asserts to the satisfaction of the authority that farming will be a significant source of income for the beginning farmer;

(vi) is enrolled in or has completed within ten years of their first year of farming a financial management program approved by the authority or the commissioner of agriculture;

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(vii) agrees to notify the authority if the beginning farmer no longer meets the eligibility requirements within the three-year certification period, in which case the beginning farmer is no longer eligible for credits under this section; and

(viii) has other qualifications as specified by the authority.

The authority may waive the requirement in item (vi) if the participant requests a waiver and has a four-year degree in an agricultural program or related field, reasonable agricultural job-related experience, or certification as an adult farm management instructor.

(d) "Family member" means a family member within the meaning of the Internal Revenue Code, section 267(c)(4).

(e) "Farm product" means plants and animals useful to humans and includes, but is not limited to, forage and sod crops, oilseeds, grain and feed crops, dairy and dairy products, poultry and poultry products, livestock, fruits, and vegetables.

(f) "Farming" means the active use, management, and operation of real and personal property for the production of a farm product.

(g) "Limited liability company" means a family farm limited liability company, an authorized farm limited liability company, or other limited liability company authorized to engage in farming and own, acquire, or otherwise obtain an interest in agricultural land under section 500.24.

~~(g)~~ (h) "Owner of agricultural assets" means an individual, trust, or pass-through entity that is the owner in fee of agricultural land or has legal title to any other agricultural asset. Owner of agricultural assets does not mean an equipment dealer, livestock dealer defined in section 17A.03, subdivision 7, or comparable entity that is engaged in the business of selling agricultural assets for profit and that is not engaged in farming as its primary business activity. An owner of agricultural assets approved and certified by the authority under subdivision 4 must notify the authority if the owner no longer meets the definition in this paragraph within the three year certification period and is then no longer eligible for credits under this section.

~~(h)~~ (i) "Resident" has the meaning given in section 290.01, subdivision 7.

~~(i)~~ (j) "Share rent agreement" means a rental agreement in which the principal consideration given to the owner of agricultural assets is a predetermined portion of the production of farm products produced from the rented agricultural assets and which provides for sharing production costs or risk of loss, or both.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

Sec. 2. Minnesota Statutes 2020, section 41B.0391, subdivision 2, is amended to read:

Subd. 2. Tax credit for owners of agricultural assets. (a) An owner of agricultural assets may take a credit against the tax due under chapter 290 for the sale or rental of agricultural assets to a beginning farmer in the amount allocated by the authority under subdivision 4. An owner of agricultural assets is eligible for allocation of a credit equal to:

(1) five percent of the lesser of the sale price or the fair market value of the agricultural asset, up to a maximum of $32,000;

(2) ten percent of the gross rental income in each of the first, second, and third years of a rental agreement, up to a maximum of $7,000 per year; or

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(3) 15 percent of the cash equivalent of the gross rental income in each of the first, second, and third years of a share rent agreement, up to a maximum of $10,000 per year.

(b) A qualifying rental agreement includes cash rent of agricultural assets or a share rent agreement. The agricultural asset must be rented at prevailing community rates as determined by the authority.

(c) The credit may be claimed only after approval and certification by the authority, and is limited to the amount stated on the certificate issued under subdivision 4. An owner of agricultural assets must apply to the authority for certification and allocation of a credit, in a form and manner prescribed by the authority.

(d) An owner of agricultural assets or beginning farmer may terminate a rental agreement, including a share rent agreement, for reasonable cause upon approval of the authority. If a rental agreement is terminated without the fault of the owner of agricultural assets, the tax credits shall not be retroactively disallowed. In determining reasonable cause, the authority must look at which party was at fault in the termination of the agreement. If the authority determines the owner of agricultural assets did not have reasonable cause, the owner of agricultural assets must repay all credits received as a result of the rental agreement to the commissioner of revenue. The repayment is additional income tax for the taxable year in which the authority makes its decision or when a final adjudication under subdivision 5, paragraph (a), is made, whichever is later.

(e) The credit is limited to the liability for tax as computed under chapter 290 for the taxable year. If the amount of the credit determined under this section for any taxable year exceeds this limitation, the excess is a beginning farmer incentive credit carryover according to section 290.06, subdivision 37.

(f) Notwithstanding subdivision 1, paragraph (c), for purposes of the credit for the sale of an agricultural asset under paragraph (a), clause (1), the family member definitional exclusions in subdivision 1, paragraph (c), clauses (4) and (5), do not apply.

(g) For a qualifying sale to a family member to qualify for the credit under paragraph (a), clause (1), the sale price of the agricultural asset must equal or exceed the assessed value of the asset under chapter 273 as of the date of the sale. If there is no assessed value, the sale price must equal or exceed 80 percent of the fair market value of the asset as of the date of the sale.

(h) For the purposes of this section, "qualifying sale to a family member" means a sale to a beginning farmer in which the beginning farmer or the beginning farmer's spouse is a family member of:

(1) the owner of the agricultural asset; or

(2) a partner, member, shareholder, or trustee of the owner of the agricultural asset.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

Sec. 3. Minnesota Statutes 2020, section 41B.0391, subdivision 4, is amended to read:

Subd. 4. Authority duties. (a) The authority shall:

(1) approve and certify or recertify beginning farmers as eligible for the program under this section;

(2) approve and certify or recertify owners of agricultural assets as eligible for the tax credit under subdivision 2 subject to the allocation limits in paragraph (c);

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(3) provide necessary and reasonable assistance and support to beginning farmers for qualification and participation in financial management programs approved by the authority;

(4) refer beginning farmers to agencies and organizations that may provide additional pertinent information and assistance; and

(5) notwithstanding section 41B.211, the Rural Finance Authority must share information with the commissioner of revenue to the extent necessary to administer provisions under this subdivision and section 290.06, subdivisions 37 and 38. The Rural Finance Authority must annually notify the commissioner of revenue of approval and certification or recertification of beginning farmers and owners of agricultural assets under this section. For credits under subdivision 2, the notification must include the amount of credit approved by the authority and stated on the credit certificate.

(b) The certification of a beginning farmer or an owner of agricultural assets under this section is valid for the year of the certification and the two following years, after which time the beginning farmer or owner of agricultural assets must apply to the authority for recertification.

(c) For credits for owners of agricultural assets allowed under subdivision 2, the authority must not allocate more than:

(1) $5,000,000 for taxable years beginning after December 31, 2017, and before January 1, 2019~~, and must not allocate more than~~;

(2) $6,000,000 for taxable years beginning after December 31, 2018, and before January 1, 2022; and

(3) $5,700,000 for taxable years beginning after December 31, 2021.

(d) The authority must allocate credits on a first-come, first-served basis beginning on January 1 of each year, except that recertifications for the second and third years of credits under subdivision 2, paragraph (a), clauses (1) and (2), have first priority. Any amount authorized but not allocated in any taxable year does not cancel and is added to the allocation for the next taxable year.

(e) $300,000 in fiscal year 2023 and $300,000 in fiscal year 2024 are appropriated from the general fund to the Rural Finance Authority to develop an online application system and administer the credits under this section. The base for the appropriation is $0 in fiscal year 2025 and later.

(f) To encourage socially disadvantaged farmers and ranchers to apply for and receive credits under this section, the authority must promote the availability of this credit to socially disadvantaged farmers and ranchers, and must provide application assistance targeted to socially disadvantaged farmers and ranchers. For the purposes of this section, "socially disadvantaged farmer or rancher" has the meaning given in United States Code, title 7, section 2279(a)(5).

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

Sec. 4. Minnesota Statutes 2021 Supplement, section 116J.8737, subdivision 5, is amended to read:

Subd. 5. Credit allowed. (a) A qualified investor or qualified fund is eligible for a credit equal to 25 percent of the qualified investment in a qualified small business. Investments made by a pass-through entity qualify for a credit only if the entity is a qualified fund. The commissioner must not allocate to qualified investors or qualified funds more than the dollar amount in credits allowed for the taxable years listed in paragraph (i). For each taxable year, 50 percent must be allocated to credits for qualified investments in qualified greater Minnesota businesses and minority-owned, women-owned, or veteran-owned qualified small businesses in Minnesota. Any portion of a

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taxable year's credits that is reserved for qualified investments in greater Minnesota businesses and minority-owned, women-owned, or veteran-owned qualified small businesses in Minnesota that is not allocated by September 30 of the taxable year is available for allocation to other credit applications beginning on October 1. Any portion of a taxable year's credits that is not allocated by the commissioner does not cancel and may be carried forward to subsequent taxable years until all credits have been allocated.

(b) The commissioner may not allocate more than a total maximum amount in credits for a taxable year to a qualified investor for the investor's cumulative qualified investments as an individual qualified investor and as an investor in a qualified fund; for married couples filing joint returns the maximum is $250,000, and for all other filers the maximum is $125,000. The commissioner may not allocate more than a total of $1,000,000 in credits over all taxable years for qualified investments in any one qualified small business.

(c) The commissioner may not allocate a credit to a qualified investor either as an individual qualified investor or as an investor in a qualified fund if, at the time the investment is proposed:

(1) the investor is an officer or principal of the qualified small business; or

(2) the investor, either individually or in combination with one or more members of the investor's family, owns, controls, or holds the power to vote 20 percent or more of the outstanding securities of the qualified small business.

A member of the family of an individual disqualified by this paragraph is not eligible for a credit under this section. For a married couple filing a joint return, the limitations in this paragraph apply collectively to the investor and spouse. For purposes of determining the ownership interest of an investor under this paragraph, the rules under section 267(c) and 267(e) of the Internal Revenue Code apply.

(d) Applications for tax credits must be made available on the department's website by November 1 of the preceding year.

(e) Qualified investors and qualified funds must apply to the commissioner for tax credits. Tax credits must be allocated to qualified investors or qualified funds in the order that the tax credit request applications are filed with the department. The commissioner must approve or reject tax credit request applications within 15 days of receiving the application. The investment specified in the application must be made within 60 days of the allocation of the credits. If the investment is not made within 60 days, the credit allocation is canceled and available for reallocation. A qualified investor or qualified fund that fails to invest as specified in the application, within 60 days of allocation of the credits, must notify the commissioner of the failure to invest within five business days of the expiration of the 60-day investment period.

(f) All tax credit request applications filed with the department on the same day must be treated as having been filed contemporaneously. If two or more qualified investors or qualified funds file tax credit request applications on the same day, and the aggregate amount of credit allocation claims exceeds the aggregate limit of credits under this section or the lesser amount of credits that remain unallocated on that day, then the credits must be allocated among the qualified investors or qualified funds who filed on that day on a pro rata basis with respect to the amounts claimed. The pro rata allocation for any one qualified investor or qualified fund is the product obtained by multiplying a fraction, the numerator of which is the amount of the credit allocation claim filed on behalf of a qualified investor and the denominator of which is the total of all credit allocation claims filed on behalf of all applicants on that day, by the amount of credits that remain unallocated on that day for the taxable year.

(g) A qualified investor or qualified fund, or a qualified small business acting on their behalf, must notify the commissioner when an investment for which credits were allocated has been made, and the taxable year in which the investment was made. A qualified fund must also provide the commissioner with a statement indicating the amount invested by each investor in the qualified fund based on each investor's share of the assets of the qualified fund at

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the time of the qualified investment. After receiving notification that the investment was made, the commissioner must issue credit certificates for the taxable year in which the investment was made to the qualified investor or, for an investment made by a qualified fund, to each qualified investor who is an investor in the fund. The certificate must state that the credit is subject to revocation if the qualified investor or qualified fund does not hold the investment in the qualified small business for at least three years, consisting of the calendar year in which the investment was made and the two following years. The three-year holding period does not apply if:

(1) the investment by the qualified investor or qualified fund becomes worthless before the end of the three-year period;

(2) 80 percent or more of the assets of the qualified small business is sold before the end of the three-year period;

(3) the qualified small business is sold before the end of the three-year period;

(4) the qualified small business's common stock begins trading on a public exchange before the end of the three‑year period; or

(5) the qualified investor dies before the end of the three-year period.

(h) The commissioner must notify the commissioner of revenue of credit certificates issued under this section.

(i) The credit allowed under this subdivision is effective as follows:

(1) $10,000,000 for taxable years beginning after December 31, 2020, and before January 1, 2022; and

(2) ~~$5,000,000~~ $12,000,000 for taxable years beginning after December 31, 2021, and before January 1, 2023.

EFFECTIVE DATE. This section is effective retroactively for taxable years beginning after December 31, 2021.

Sec. 5. Minnesota Statutes 2021 Supplement, section 116U.27, subdivision 1, is amended to read:

Subdivision 1. Definitions. (a) For purposes of this section, the following terms have the meanings given.

(b) "Allocation certificate" means a certificate issued by the commissioner to a taxpayer upon receipt of an initial application for a credit for a project that has not yet been completed.

(d) "Commissioner" means the commissioner of employment and economic development.

(e) "Credit certificate" means a certificate issued by the commissioner upon submission of the cost verification report in subdivision 4, paragraph (e).

(f) "Eligible production costs" means eligible production costs as defined in section 116U.26, paragraph (b), clause (1), incurred in Minnesota that are directly attributable to the production of a film project in Minnesota.

(g) "Film" has the meaning given in section 116U.26, paragraph (b), clause (2).

(h) "Project" means a film:

(1) that includes the promotion of Minnesota;

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(2) for which the taxpayer has expended at least $1,000,000 in ~~the taxable year~~ any consecutive twelve-month period for eligible production costs, provided that the taxpayer designates the months used for the period to the commissioner and does not designate a month previously designated; and

(3) to the extent practicable, that employs Minnesota residents.

(i) "Promotion of Minnesota" or "promotion" means visible display of a static or animated logo, approved by the commissioner and lasting approximately five seconds, that promotes Minnesota within its presentation in the end credits before the below-the-line crew crawl for the life of the project.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

Sec. 6. Minnesota Statutes 2021 Supplement, section 116U.27, subdivision 2, is amended to read:

Subd. 2. Credit allowed. A taxpayer is eligible for a credit up to 25 percent of any eligible production costs paid in a taxable year. A taxpayer may only claim a credit if the taxpayer was issued a credit certificate under subdivision 4.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

Sec. 7. Minnesota Statutes 2021 Supplement, section 289A.08, subdivision 7a, is amended to read:

Subd. 7a. Pass-through entity tax. (a) For the purposes of this subdivision, the following terms have the meanings given:

(1) "income" has the meaning given in subdivision 7, paragraph (j), modified by the addition provided in section 290.0131, subdivision 5, and the subtraction provided in section 290.0132, subdivision 3, except that the provisions that apply to a partnership apply to a qualifying entity and the provisions that apply to a partner apply to a qualifying owner. The income of ~~both~~ a resident ~~and~~ qualifying owner of an entity taxed as a partnership under the Internal Revenue Code is not subject to allocation outside this state as provided for resident individuals under section 290.17, subdivision 1, paragraph (a). The income of a nonresident qualifying owner or the income of a qualifying owner of an entity taxed as an S corporation including a qualified subchapter S subsidiary organized under section 1361(b)(3)(B) of the Internal Revenue Code is allocated and assigned to this state as provided for nonresident partners and shareholders under sections 290.17, 290.191, and 290.20;

(2) "qualifying entity" means a partnership, limited liability company taxed as a partnership or S corporation, or S corporation including a qualified subchapter S subsidiary organized under section 1361(b)(3)(B) of the Internal Revenue Code. Qualifying entity ~~does not~~ may include a partnership, limited liability company, or corporation that has a ~~partnership, limited liability company other than a disregarded entity, or~~ corporation as a partner, member, or shareholder, provided those entities are excluded from the qualifying entity's tax return; the entity is taxed as a partnership, limited liability company, or S corporation; and is not a publicly traded partnership, as defined in section 7704 of the Internal Revenue Code, as amended through January 1, 2021; and

(3) "qualifying owner" means:

(i) a resident or nonresident individual trust or estate that is a partner, member, or shareholder of a qualifying entity; or

(ii) ~~a resident or nonresident trust that is a shareholder of a qualifying entity that is an S corporation~~ an entity taxed as a partnership under the Internal Revenue Code; or

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(iii) a disregarded entity that has a qualifying owner as its single owner.

(b) For taxable years beginning after December 31, 2020, in which the taxes of a qualifying owner are limited under section 164(b)(6)(B) of the Internal Revenue Code, a qualifying entity may elect to file a return and pay the pass-through entity tax imposed under paragraph (c). The election:

(1) must be made on or before the due date or extended due date of the qualifying entity's pass-through entity tax return;

(2) may only be made by qualifying owners who collectively hold more than a 50 percent ownership interest in the qualifying entity;

(3) is binding on all qualifying owners who have an ownership interest in the qualifying entity; and

(4) once made is irrevocable for the taxable year.

(c) Subject to the election in paragraph (b), a pass-through entity tax is imposed on a qualifying entity in an amount equal to the sum of the tax liability of each qualifying owner.

(d) The amount of a qualifying owner's tax liability under paragraph (c) is the amount of the qualifying owner's income multiplied by the highest tax rate for individuals under section 290.06, subdivision 2c. When making this determination:

(1) nonbusiness deductions, standard deductions, or personal exemptions are not allowed; and

(2) a credit or deduction is allowed only to the extent allowed to the qualifying owner.

(e) The amount of each credit and deduction used to determine a qualifying owner's tax liability under paragraph (d) must also be used to determine that qualifying owner's income tax liability under chapter 290.

(f) This subdivision does not negate the requirement that a qualifying owner pay estimated tax if the qualifying owner's tax liability would exceed the requirements set forth in section 289A.25. The qualifying owner's liability to pay estimated tax on the qualifying owner's tax liability as determined under paragraph (d) is, however, satisfied when the qualifying entity pays estimated tax in the manner prescribed in section 289A.25 for composite estimated tax.

(g) A qualifying owner's adjusted basis in the interest in the qualifying entity, and the treatment of distributions, is determined as if the election to pay the pass-through entity tax under paragraph (b) is not made.

(h) To the extent not inconsistent with this subdivision, for purposes of this chapter, a pass-through entity tax return must be treated as a composite return and a qualifying entity filing a pass-through entity tax return must be treated as a partnership filing a composite return.

(i) The provisions of subdivision 17 apply to the election to pay the pass-through entity tax under this subdivision.

(j) If a nonresident qualifying owner of a qualifying entity making the election to file and pay the tax under this subdivision has no other Minnesota source income, filing of the pass-through entity tax return is a return for purposes of subdivision 1, provided that the nonresident qualifying owner must not have any Minnesota source income other than the income from the qualifying entity, other electing qualifying entities, and other partnerships electing to file a composite return under subdivision 7. If it is determined that the nonresident qualifying owner has other Minnesota source income, the inclusion of the income and tax liability for that owner under this provision will not constitute a return to satisfy the requirements of subdivision 1. The tax paid for the qualifying owner as part of the pass-through entity tax return is allowed as a payment of the tax by the qualifying owner on the date on which the pass-through entity tax return payment was made.

EFFECTIVE DATE. This section is effective retroactively for taxable years beginning after December 31, 2020.

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Sec. 8. Minnesota Statutes 2021 Supplement, section 289A.382, subdivision 2, is amended to read:

Subd. 2. Reporting and payment requirements for partnerships and tiered partners. (a) Except for when an audited partnership makes the election in subdivision 3, and except for negative federal adjustments required under federal law taken into account by the partnership in the partnership return for the adjustment or other year, all final federal adjustments of an audited partnership must comply with paragraph (b) and each direct partner of the audited partnership, other than a tiered partner, must comply with paragraph (c).

(b) No later than 90 days after the final determination date, the audited partnership must:

(1) file a completed federal adjustments report, including all partner-level information required under section 289A.12, subdivision 3, with the commissioner;

(2) notify each of its direct partners of their distributive share of the final federal adjustments;

(3) file an amended composite report for all direct partners who were included in a composite return under section 289A.08, subdivision 7, in the reviewed year, and pay the additional amount that would have been due had the federal adjustments been reported properly as required; ~~and~~

(4) file amended withholding reports for all direct partners who were or should have been subject to nonresident withholding under section 290.92, subdivision 4b, in the reviewed year, and pay the additional amount that would have been due had the federal adjustments been reported properly as required.; and

(5) file an amended pass-through entity tax report for all direct partners who were included in a pass-through entity tax return under section 289A.08, subdivision 7a, in the reviewed year, and pay the additional amount that would have been due had the federal adjustments been reported properly as required.

(c) No later than 180 days after the final determination date, each direct partner, other than a tiered partner, that is subject to a tax administered under this chapter, other than the sales tax, must:

(1) file a federal adjustments report reporting their distributive share of the adjustments reported to them under paragraph (b), clause (2); and

(2) pay any additional amount of tax due as if the final federal adjustment had been properly reported, plus any penalty and interest due under this chapter, and less any credit for related amounts paid or withheld and remitted on behalf of the direct partner under paragraph (b), clauses (3) and (4).

EFFECTIVE DATE. This section is effective retroactively for taxable years beginning after December 31, 2020.

Sec. 9. Minnesota Statutes 2020, section 290.0131, is amended by adding a subdivision to read:

Subd. 20. Dependent flexible spending accounts. For a taxpayer who claims the credit under section 290.067, or for a married taxpayer filing a separate return whose spouse claims the credit under that section, the amount of dependent care assistance that is excluded from gross income under section 129 of the Internal Revenue Code is an addition.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

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Sec. 10. Minnesota Statutes 2020, section 290.0132, subdivision 21, is amended to read:

Subd. 21. Military service pension; retirement pay. (a) To the extent included in federal adjusted gross income, compensation received from a pension or other retirement pay from the federal government for service in the military~~, as~~ is a subtraction. Only the following amounts may be subtracted under this subdivision:

(1) compensation computed under United States Code, title 10, sections 1401 to 1414, 1447 to 1455, and 12733~~, is a subtraction.~~;

(2) the total amount of a federal employee retirement system pension under United States Code, title 5, chapter 84, multiplied by the taxpayer's military service ratio; and

(3) the total amount of a civil service retirement system pension under United States Code, title 5, chapter 83, subchapter III, multiplied by the taxpayer's military service ratio.

(b) The subtraction is limited to individuals who do not claim the credit under section 290.0677.

(1) in the case of a federal employee retirement system pension, the years of service credited to the taxpayer for military service under United States Code, title 5, section 8411, divided by the total service credited to the taxpayer under that section; and

(2) in the case of a civil service retirement system pension, the years of service credited to the taxpayer for military service under United States Code, title 5, section 8322, divided by the total service credited to the taxpayer under that section.

(d) For purposes of calculating the ratio under paragraph (b), the commissioner must consider the number of full years and months credited to the taxpayer, excluding any fractional part of a month, if any.

EFFECTIVE DATE. This section is effective retroactively for taxable years beginning after December 31, 2020.

Sec. 11. Minnesota Statutes 2020, section 290.0132, subdivision 26, is amended to read:

Subd. 26. Social Security benefits. (a) A ~~portion of taxable Social Security benefits is allowed as a subtraction. The~~ taxpayer is allowed a subtraction ~~equals~~ equal to the greater of the simplified subtraction determined under paragraph (b) or the alternate subtraction determined under paragraphs (c), (d), and (e).

(b) A taxpayer's simplified subtraction equals the amount of taxable Social Security benefits. For a taxpayer with adjusted gross income above the phaseout threshold, the subtraction is reduced by ten percent for each $4,000 of adjusted gross income, or fraction thereof, in excess of the threshold. The phaseout threshold equals:

(1) $75,000 for a married taxpayer filing a joint return or surviving spouse;

(2) $58,600 for a single or head of household taxpayer; or

(3) half the amount allowed under clause (1) for a married taxpayer filing a separate return.

(c) A taxpayer's alternate subtraction equals the lesser of taxable Social Security benefits or a maximum subtraction subject to the limits under paragraphs ~~(b), (c), and~~ (d), (e), and (f).

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~~(b)~~ (d) For married taxpayers filing a joint return and surviving spouses, the maximum subtraction under paragraph (c) equals ~~$5,150~~ $5,450. The maximum subtraction is reduced by 20 percent of provisional income over ~~$78,180~~ $82,770. In no case is the subtraction less than zero.

~~(c)~~ (e) For single or head-of-household taxpayers, the maximum subtraction under paragraph (c) equals ~~$4,020~~ $4,260. The maximum subtraction is reduced by 20 percent of provisional income over ~~$61,080~~ $64,670. In no case is the subtraction less than zero.

~~(d)~~ (f) For married taxpayers filing separate returns, the maximum subtraction under paragraph (c) equals one‑half the maximum subtraction for joint returns under paragraph ~~(b)~~ (d). The maximum subtraction is reduced by 20 percent of provisional income over one-half the threshold amount specified in paragraph ~~(b)~~ (d). In no case is the subtraction less than zero.

~~(e)~~ (g) For purposes of this subdivision, "provisional income" means modified adjusted gross income as defined in section 86(b)(2) of the Internal Revenue Code, plus one-half of the taxable Social Security benefits received during the taxable year, and "Social Security benefits" has the meaning given in section 86(d)(1) of the Internal Revenue Code.

~~(f)~~ (h) The commissioner shall adjust the maximum subtraction and threshold amounts in paragraphs (b) to ~~(d)~~ (f) as provided in section 270C.22. The statutory year is taxable year ~~2019~~ 2022. The ~~maximum subtraction and~~ phaseout threshold amounts as adjusted must be rounded to the nearest $10 amount. If the amount ends in $5, the amount is rounded up to the nearest $10 amount.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

Sec. 12. Minnesota Statutes 2020, section 290.0132, is amended by adding a subdivision to read:

Subd. 32. Emergency assistance for postsecondary student grants. (a) An emergency grant for postsecondary students is a subtraction.

(b) For the purposes of this subdivision, "emergency grant for postsecondary students" means an emergency grant to a student of an eligible institution, as defined in section 136A.103, to meet the financial needs of a student that could result in the student not completing the term or their program, including but not limited to grants provided under Laws 2021, First Special Session chapter 2, article 1, section 2, subdivision 24.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021, and before January 1, 2030.

Sec. 13. Minnesota Statutes 2020, section 290.0132, is amended by adding a subdivision to read:

Subd. 33. Workforce incentive fund grant payments. (a) The amount of workforce incentive grants received by an eligible worker under section 256.4778 is a subtraction.

(b) This subdivision expires for taxable years beginning after December 31, 2029.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021, and before January 1, 2030.

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Sec. 14. Minnesota Statutes 2021 Supplement, section 290.06, subdivision 22, is amended to read:

Subd. 22. Credit for taxes paid to another state. (a) A taxpayer who is liable for taxes based on net income to another state, as provided in paragraphs (b) through (f), upon income allocated or apportioned to Minnesota, is entitled to a credit for the tax paid to another state if the tax is actually paid in the taxable year or a subsequent taxable year. A taxpayer who is a resident of this state pursuant to section 290.01, subdivision 7, paragraph (b), and who is subject to income tax as a resident in the state of the individual's domicile is not allowed this credit unless the state of domicile does not allow a similar credit.

(b) For an individual, estate, or trust, the credit is determined by multiplying the tax payable under this chapter by the ratio derived by dividing the income subject to tax in the other state that is also subject to tax in Minnesota while a resident of Minnesota by the taxpayer's federal adjusted gross income, as defined in section 62 of the Internal Revenue Code, modified by the addition required by section 290.0131, subdivision 2, and the subtraction allowed by section 290.0132, subdivision 2, to the extent the income is allocated or assigned to Minnesota under sections 290.081 and 290.17.

(c) If the taxpayer is an athletic team that apportions all of its income under section 290.17, subdivision 5, the credit is determined by multiplying the tax payable under this chapter by the ratio derived from dividing the total net income subject to tax in the other state by the taxpayer's Minnesota taxable income.

(d)(1) The credit determined under paragraph (b) or (c) shall not exceed the amount of tax so paid to the other state on the gross income earned within the other state subject to tax under this chapter; and

(2) the allowance of the credit does not reduce the taxes paid under this chapter to an amount less than what would be assessed if the gross income earned within the other state were excluded from taxable net income.

(e) In the case of the tax assessed on a lump-sum distribution under section 290.032, the credit allowed under paragraph (a) is the tax assessed by the other state on the lump-sum distribution that is also subject to tax under section 290.032, and shall not exceed the tax assessed under section 290.032. To the extent the total lump-sum distribution defined in section 290.032, subdivision 1, includes lump-sum distributions received in prior years or is all or in part an annuity contract, the reduction to the tax on the lump-sum distribution allowed under section 290.032, subdivision 2, includes tax paid to another state that is properly apportioned to that distribution.

(f) If a Minnesota resident reported an item of income to Minnesota and is assessed tax in such other state on that same income after the Minnesota statute of limitations has expired, the taxpayer shall receive a credit for that year under paragraph (a), notwithstanding any statute of limitations to the contrary. The claim for the credit must be submitted within one year from the date the taxes were paid to the other state. The taxpayer must submit sufficient proof to show entitlement to a credit.

(g) For the purposes of this subdivision, a resident shareholder of a corporation treated as an "S" corporation under section 290.9725, must be considered to have paid a tax imposed on the shareholder in an amount equal to the shareholder's pro rata share of any net income tax paid by the S corporation to another state. For the purposes of the preceding sentence, the term "net income tax" means any tax imposed on or measured by a corporation's net income.

(h) For the purposes of this subdivision, a resident partner of an entity taxed as a partnership under the Internal Revenue Code must be considered to have paid a tax imposed on the partner in an amount equal to the partner's pro rata share of any net income tax paid by the partnership to another state. For purposes of the preceding sentence, the term "net income" tax means any tax imposed on or measured by a partnership's net income. For purposes of this paragraph, "partnership" includes a limited liability company and "partner" includes a member of a limited liability company.

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(i) For the purposes of this subdivision, "another state":

(1) includes:

(i) the District of Columbia; and

(ii) a province or territory of Canada; but

(2) excludes Puerto Rico and the several territories organized by Congress.

(j) The limitations on the credit in paragraphs (b), (c), and (d), are imposed on a state by state basis.

(k) For a tax imposed by a province or territory of Canada, the tax for purposes of this subdivision is the excess of the tax over the amount of the foreign tax credit allowed under section 27 of the Internal Revenue Code. In determining the amount of the foreign tax credit allowed, the net income taxes imposed by Canada on the income are deducted first. Any remaining amount of the allowable foreign tax credit reduces the provincial or territorial tax that qualifies for the credit under this subdivision.

(l)(1) The credit allowed to a qualifying individual under this section for tax paid to a qualifying state equals the credit calculated under paragraphs (b) and (d), plus the amount calculated by multiplying:

(i) the difference between the preliminary credit and the credit calculated under paragraphs (b) and (d), by

(ii) the ratio derived by dividing the income subject to tax in the qualifying state that consists of compensation for performance of personal or professional services by the total amount of income subject to tax in the qualifying state.

(2) If the amount of the credit that a qualifying individual is eligible to receive under clause (1) for tax paid to a qualifying state exceeds the tax due under this chapter before the application of the credit calculated under clause (1), the commissioner shall refund the excess to the qualifying individual. An amount sufficient to pay the refunds required by this subdivision is appropriated to the commissioner from the general fund.

(3) For purposes of this paragraph, "preliminary credit" means the credit that a qualifying individual is eligible to receive under paragraphs (b) and (d) for tax paid to a qualifying state without regard to the limitation in paragraph (d), clause (2); "qualifying individual" means a Minnesota resident under section 290.01, subdivision 7, paragraph (a), who received compensation during the taxable year for the performance of personal or professional services within a qualifying state; and "qualifying state" means a state with which an agreement under section 290.081 is not in effect for the taxable year but was in effect for a taxable year beginning before January 1, 2010.

(m) For purposes of this subdivision, a resident sole member of a disregarded limited liability company must be considered to have paid a tax imposed on the sole member in an amount equal to the net income tax paid by the disregarded limited liability company to another state. For the purposes of this paragraph, the term "disregarded limited liability company" means a limited liability company that is disregarded as an entity separate from its owner as defined in Code of Federal Regulations, title 26, section 301.7701; and "net income" tax means any tax imposed on or measured by a disregarded limited liability company's net income.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

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Sec. 15. Minnesota Statutes 2020, section 290.067, is amended to read:

290.067 ~~DEPENDENT~~ GREAT START CHILD CARE AND DEPENDENT CARE CREDIT.

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 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 the taxpayer's eligible dependent care expenses, as determined under subdivisions 1a and 1b, multiplied by the taxpayer's credit percentage, as determined under subdivision 1c.

(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.

~~(c) If a married couple:~~

~~(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.

~~(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.

~~(e)~~ (b) 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 290.0132, subdivision 10,~~ the credit determined under ~~section 21 of the Internal Revenue Code~~ this section 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~~ using the percentage calculated in section 290.06, subdivision 2c, paragraph (e).

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(1) "employment-related expenses" has the meaning given in section 21(b)(2) of the Internal Revenue Code;

(2) "qualifying individual" has the meaning given in section 21(b)(1) of the Internal Revenue Code, 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

(3) "young child" means a qualifying individual who had not attained the age of five by December 31 of the taxable year.

~~(f) For residents of Minnesota, the subtractions for military pay under section 290.0132, subdivisions 11 and 12, are not considered "earned income not subject to tax under this chapter."~~

~~(g) For residents of Minnesota, the exclusion of combat pay under section 112 of the Internal Revenue Code is not considered "earned income not subject to tax under this chapter."~~

(h) For taxpayers with federal adjusted gross income in excess of $52,230, the credit is equal to the lesser of the credit otherwise calculated under this subdivision, or the amount equal to $600 minus five percent of federal adjusted gross income in excess of $52,230 for taxpayers with one qualified individual, or $1,200 minus five percent of federal adjusted gross income in excess of $52,230 for taxpayers with two or more qualified individuals, but in no case is the credit less than zero.

Subd. 1a. Eligible dependent care expenses. (a) A taxpayer's eligible dependent care expenses equals the amount of employment-related expenses incurred by the taxable year, subject to the limitations in paragraphs (b) and (c).

(b) Except as provided in subdivision 1b, a taxpayer's eligible dependent care expenses are limited to:

(1) $3,000 if there was one qualifying individual with respect to the taxpayer; or

(2) $6,000 if there were two or more qualifying individuals with respect to the taxpayer.

Subd. 1b. Special rules for tax years 2022 to 2028. For taxable years beginning after December 31, 2021, and before January 1, 2029, for a taxpayer with a young child, the limit in paragraph (b) is increased as follows:

(1) for a taxpayer with one young child with respect to the taxpayer, the limit is increased by $3,000;

(2) for a taxpayer with two young children with respect to the taxpayer, the limit is increased by $6,000; or

(3) for a taxpayer with three or more young children with respect to the taxpayer, the limit is increased by $9,000.

Subd. 1c. Credit percentage. (a) The credit percentage equals 50 percent, subject to the reductions in paragraphs (b) and (c).

(b) A taxpayer's credit percentage is reduced by one percentage point for each $2,000, or fraction thereof, by which the taxpayer's adjusted gross income exceeds $125,000, until the credit percentage equals 20 percent.

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(c) For a taxpayer with adjusted gross income in excess of $400,000, the credit percentage equals 20 percent, reduced by one percentage point for each $2,000, or fraction thereof, by which the taxpayer's adjusted gross income exceeds $400,000.

Subd. 2b. Inflation adjustment. The commissioner shall annually adjust the dollar amount of the income threshold at which the ~~maximum~~ credit percentage begins to be reduced under subdivision 1 1c as provided in section 270C.22. The statutory year is taxable year ~~2019~~ 2022.

Subd. 2c. Deemed expenses. (a) 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. 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.

(b) If a married couple:

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

(2) does not participate in a dependent care assistance program as defined in section 129 of the Internal Revenue Code; then in lieu of the actual employment-related expenses paid for that child under or the deemed amount under paragraph (a), the amount deemed to be the employment-related expense paid for that child equals the lesser of:

(i) the combined earned income of the couple; or

(ii) the amount of the maximum limit for one qualified individual under subdivision 1a, as increased by subdivision 1b.

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.

Subd. 2d. Identifying information required. (a) 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

(b) The rule in section 21(e)(10) of the Internal Revenue Code applies for the credit under this section.

Subd. 3. Credit to be refundable. If the amount of credit which a claimant would be eligible to receive pursuant to this subdivision exceeds the claimant's tax liability under chapter 290, the excess amount of the credit shall be refunded to the claimant by the commissioner of revenue. An amount sufficient to pay the refunds required by this section is appropriated to the commissioner from the general fund.

Subd. 4. Right to file claim. The right to file a claim under this section shall be personal to the claimant and shall not survive death, but such right may be exercised on behalf of a claimant by the claimant's legal guardian or attorney-in-fact. When a claimant dies after having filed a timely claim the amount thereof shall be disbursed to another member of the household as determined by the commissioner of revenue. If the claimant was the only member of a household, the claim may be paid to the claimant's personal representative, but if neither is appointed and qualified within two years of the filing of the claim, the amount of the claim shall escheat to the state.

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Subd. 5. Employment-related expenses. For the purposes of determining employment-related expenses, the provisions of sections 21(d) and 21(e)(6) of the Internal Revenue Code apply.

Subd. 6. Rules for married couples filing separate returns. A married taxpayer filing a separate return may claim the credit under this section, but only one spouse may claim the credit.

EFFECTIVE DATE. This section is effective for taxable years beginning after December 31, 2021.

Sec. 16. Minnesota Statutes 2021 Supplement, section 290.0671, subdivision 1, is amended to read:

Subdivision 1. Credit allowed. (a) An individual who is a resident of Minnesota 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, except that:

(1) a taxpayer with no qualifying children who has attained the age of 19, but not attained age 65 before the close of the taxable year and is otherwise eligible for a credit under section 32 of the Internal Revenue Code may also receive a credit; ~~and~~

(2) a taxpayer who is otherwise eligible for a credit under section 32 of the Internal Revenue Code remains eligible for the credit even if the taxpayer's earned income or adjusted gross income exceeds the income limitation under section 32 of the Internal Revenue Code.; and

(3) the requirements of section 32(m) of the Internal Revenue Code do not apply.

(b) For individuals with no qualifying children, the credit equals 3.9 percent of the first $7,150 of earned income. The credit is reduced by 2.0 percent of earned income or adjusted gross income, whichever is greater, in excess of the phaseout threshold, but in no case is the credit less than zero.

(c) For individuals with one qualifying child, the credit equals 9.35 percent of the first $11,950 of earned income. The credit is reduced by 6.0 percent of earned income or adjusted gross income, whichever is greater, in excess of the phaseout threshold, but in no case is the credit less than zero.

(d) For individuals with two qualifying children, the credit equals 11 percent of the first $19,600 of earned income. The credit is reduced by 10.5 percent of earned income or adjusted gross income, whichever is greater, in excess of the phaseout threshold, but in no case is the credit less than zero.

(e) For individuals with three or more qualifying children, the credit equals 12.5 percent of the first $20,000 of earned income. The credit is reduced by 10.5 percent of earned income or adjusted gross income, whichever is greater, in excess of the phaseout threshold, but in no case is the credit less than zero.

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

(g) 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 290.0132, subdivision 10, 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. For purposes of this paragraph, the following clauses are not considered "earned income not subject to tax under this chapter":

(1) the subtractions for military pay under section 290.0132, subdivisions 11 and 12;

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