1.1.................... moves to amend H.F. No. 3729 as follows:
1.2Delete everything after the enacting clause and insert:


1.5    Section 1. Minnesota Statutes 2008, section 82B.035, subdivision 2, is amended to read:
1.6    Subd. 2. Assessors. Nothing in this chapter shall be construed as requiring the
1.7licensing of persons employed and acting in their capacity as assessors for political
1.8subdivisions of the state and performing duties enumerated in section 273.061, subdivision
1.97 or 8.
1.10EFFECTIVE DATE.This section is effective the day following final enactment
1.11for testimony offered and opinions or reports prepared in cases or proceedings that have
1.12not been finally resolved.

1.13    Sec. 2. Minnesota Statutes 2008, section 270.075, subdivision 1, is amended to read:
1.14    Subdivision 1. Rate of tax. The commissioner shall determine the rate of tax to be
1.15levied and collected against the net tax capacity as determined pursuant to section 270.074,
1.16subdivision 2 3 , to generate revenues sufficient to fund the airflight property tax portion
1.17of each year's state airport fund appropriation, as certified to the commissioner by the
1.18commissioner of transportation. The certification shall be presented to the commissioner
1.19prior to December 31 of each year. The property tax portion of the state airport fund
1.20appropriation is the difference between the total fund appropriation and the estimated total
1.21fund revenues from other sources for the state fiscal year in which the tax is payable. If a
1.22levy amount has not been certified by September 1 of a levy year, the commissioner shall
1.23use the last previous certified amount to determine the rate of tax. The certification by the
1.24commissioner of transportation to the commissioner shall state the total fund appropriation
2.1and shall list individually the estimated fund revenues. The difference of these amounts
2.2shall be shown as the property tax portion of the state airport fund appropriation.
2.3If a levy amount has not been certified by December 31 of a levy year, the
2.4commissioner shall use the last previous certified amount to determine the rate of tax, and
2.5shall notify the chairs and the ranking minority members of the committees of the house
2.6of representatives and senate having jurisdiction over the Department of Transportation
2.7that a certification was not made under this subdivision.
2.8EFFECTIVE DATE.This section is effective for taxes payable in 2011 and
2.9thereafter.

2.10    Sec. 3. Minnesota Statutes 2008, section 270.075, subdivision 2, is amended to read:
2.11    Subd. 2. Notice of taxes; payment. As soon as practicable and not later than
2.12December March 1 next following the levy of the tax, the commissioner shall give actual
2.13notice to the airline company of the net tax capacity and of the tax. The taxes imposed
2.14under sections 270.071 to 270.079 shall become due and payable on January April 1
2.15following the levy thereof. If any tax is not paid on the due date or, if an appeal is made
2.16pursuant to section 270.076, within 60 days after notice of an increased tax, a late payment
2.17penalty of five percent of the unpaid tax shall be assessed. If the tax remains unpaid for
2.18more than 30 days, an additional penalty of five percent of the unpaid tax is imposed for
2.19each additional 30 days or fraction of 30 days that the tax remains unpaid. The penalty
2.20imposed under this section must not exceed the lesser of $25,000 or 25 percent of the
2.21unpaid tax. The unpaid tax and penalty shall bear interest at the rate specified in section
2.22270C.40 from the time such tax should have been paid until paid. All interest and penalties
2.23shall be added to the tax and collected as a part thereof.
2.24EFFECTIVE DATE.This section is effective for taxes payable in 2011 and
2.25thereafter.

2.26    Sec. 4. Minnesota Statutes 2008, section 270.41, subdivision 5, is amended to read:
2.27    Subd. 5. Prohibited activity. A licensed assessor or other person employed by an
2.28assessment jurisdiction or contracting with an assessment jurisdiction for the purpose
2.29of valuing or classifying property for property tax purposes is prohibited from making
2.30appraisals or analyses, accepting an appraisal assignment, or preparing an appraisal report
2.31as defined in section 82B.02, subdivisions 2 to 5, on any property within the assessment
2.32jurisdiction where the individual is employed or performing the duties of the assessor
2.33under contract. Violation of this prohibition shall result in immediate revocation of the
3.1individual's license to assess property for property tax purposes. This prohibition must
3.2not be construed to prohibit an individual from carrying out any duties required for the
3.3proper assessment of property for property tax purposes or performing duties enumerated
3.4in section 273.061, subdivision 7 or 8. If a formal resolution has been adopted by the
3.5governing body of a governmental unit, which specifies the purposes for which such
3.6work will be done, this prohibition does not apply to appraisal activities undertaken on
3.7behalf of and at the request of the governmental unit that has employed or contracted with
3.8the individual. The resolution may only allow appraisal activities which are related to
3.9condemnations, right-of-way acquisitions, or special assessments.
3.10EFFECTIVE DATE.This section is effective the day following final enactment
3.11for testimony offered and opinions or reports prepared in cases or proceedings that have
3.12not been finally resolved.

3.13    Sec. 5. Minnesota Statutes 2008, section 272.0213, is amended to read:
3.14272.0213 LEASED SEASONAL-RECREATIONAL LAND.
3.15    (a) A county board may elect, by resolution, to exempt from taxation, including the
3.16tax under section 273.19, qualified lands. "Qualified lands" for purposes of this section
3.17means property that:
3.18    (1) is owned by a county, city, town, or the state, or the federal governments;
3.19    (2) is rented by the entity for noncommercial seasonal-recreational or noncommercial
3.20seasonal-recreational residential use; and
3.21    (3) was rented for the purposes specified in clause (2) and was exempt from taxation
3.22for property taxes payable in 2008.
3.23(b) Lands owned by the federal government and rented for noncommercial
3.24seasonal-recreational or noncommercial seasonal-recreational residential use is exempt
3.25from taxation, including the tax under section 273.19.
3.26EFFECTIVE DATE.This section is effective beginning with taxes payable in 2011.

3.27    Sec. 6. Minnesota Statutes 2008, section 273.061, subdivision 7, is amended to read:
3.28    Subd. 7. Division of duties between local and county assessor. The duty of the
3.29duly appointed local assessor shall be to view and appraise the value of all property as
3.30provided by law, but all the book work shall be done by the county assessor, or the
3.31assessor's assistants, and the value of all property subject to assessment and taxation
3.32shall be determined by the county assessor, except as otherwise hereinafter provided. If
4.1directed by the county assessor, the local assessor shall perform the duties enumerated
4.2in subdivision 8, paragraph (16).

4.3    Sec. 7. Minnesota Statutes 2008, section 273.061, subdivision 8, is amended to read:
4.4    Subd. 8. Powers and duties. The county assessor shall have the following powers
4.5and duties:
4.6(1) To call upon and confer with the township and city assessors in the county, and
4.7advise and give them the necessary instructions and directions as to their duties under
4.8the laws of this state, to the end that a uniform assessment of all real property in the
4.9county will be attained.
4.10(2) To assist and instruct the local assessors in the preparation and proper use of land
4.11maps and record cards, in the property classification of real and personal property, and in
4.12the determination of proper standards of value.
4.13(3) To keep the local assessors in the county advised of all changes in assessment
4.14laws and all instructions which the assessor receives from the commissioner of revenue
4.15relating to their duties.
4.16(4) To have authority to require the attendance of groups of local assessors at
4.17sectional meetings called by the assessor for the purpose of giving them further assistance
4.18and instruction as to their duties.
4.19(5) To immediately commence the preparation of a large scale topographical land
4.20map of the county, in such form as may be prescribed by the commissioner of revenue,
4.21showing thereon the location of all railroads, highways and roads, bridges, rivers and
4.22lakes, swamp areas, wooded tracts, stony ridges and other features which might affect
4.23the value of the land. Appropriate symbols shall be used to indicate the best, the fair, and
4.24the poor land of the county. For use in connection with the topographical land map,
4.25the assessor shall prepare and keep available in the assessor's office tables showing fair
4.26average minimum and maximum market values per acre of cultivated, meadow, pasture,
4.27cutover, timber and waste lands of each township. The assessor shall keep the map and
4.28tables available in the office for the guidance of town assessors, boards of review, and
4.29the county board of equalization.
4.30(6) To also prepare and keep available in the office for the guidance of town
4.31assessors, boards of review and the county board of equalization, a land valuation map
4.32of the county, in such form as may be prescribed by the commissioner of revenue. This
4.33map, which shall include the bordering tier of townships of each county adjoining, shall
4.34show the average market value per acre, both with and without improvements, as finally
5.1equalized in the last assessment of real estate, of all land in each town or unorganized
5.2township which lies outside the corporate limits of cities.
5.3(7) To regularly examine all conveyances of land outside the corporate limits of
5.4cities of the first and second class, filed with the county recorder of the county, and keep a
5.5file, by descriptions, of the considerations shown thereon. From the information obtained
5.6by comparing the considerations shown with the market values assessed, the assessor
5.7shall make recommendations to the county board of equalization of necessary changes in
5.8individual assessments or aggregate valuations.
5.9(8) To become familiar with the values of the different items of personal property
5.10so as to be in a position when called upon to advise the boards of review and the county
5.11board of equalization concerning property, market values thereof.
5.12(9) While the county board of equalization is in session, to give it every possible
5.13assistance to enable it to perform its duties. The assessor shall furnish the board with all
5.14necessary charts, tables, comparisons, and data which it requires in its deliberations, and
5.15shall make whatever investigations the board may desire.
5.16(10) At the request of either the board of county commissioners or the commissioner
5.17of revenue, to investigate applications for reductions of valuation and abatements and
5.18settlements of taxes, examine the real or personal property involved, and submit written
5.19reports and recommendations with respect to the applications, in such form as may be
5.20prescribed by the board of county commissioners and commissioner of revenue.
5.21(11) To make diligent search each year for real and personal property which has been
5.22omitted from assessment in the county, and report all such omissions to the county auditor.
5.23(12) To regularly confer with county assessors in all adjacent counties about the
5.24assessment of property in order to uniformly assess and equalize the value of similar
5.25properties and classes of property located in adjacent counties. The conference shall
5.26emphasize the assessment of agricultural and commercial and industrial property or other
5.27properties that may have an inadequate number of sales in a single county.
5.28(13) To render such other services pertaining to the assessment of real and personal
5.29property in the county as are not inconsistent with the duties set forth in this section, and as
5.30may be required by the board of county commissioners or by the commissioner of revenue.
5.31(14) To maintain a record, in conjunction with other county offices, of all transfers of
5.32property to assist in determining the proper classification of property, including but not
5.33limited to, transferring homestead property and name changes on homestead property.
5.34(15) To determine if a homestead application is required due to the transfer of
5.35homestead property or an owner's name change on homestead property.
6.1(16) To perform appraisals of property, review the original assessment and determine
6.2the accuracy of the original assessment, prepare an appraisal or appraisal report, and
6.3testify before any court or other body as an expert or otherwise on behalf of the assessor's
6.4jurisdiction with respect to properties in that jurisdiction.
6.5EFFECTIVE DATE.This section is effective the day following final enactment
6.6for testimony offered and opinions or reports prepared in cases or proceedings that have
6.7not been finally resolved.

6.8    Sec. 8. Minnesota Statutes 2008, section 273.1231, subdivision 1, is amended to read:
6.9    Subdivision 1. Applicability. For purposes of sections 273.1231 to 273.1235
6.10273.1236, the following words, terms, and phrases have the meanings given them in this
6.11section unless the language or context clearly indicates that a different meaning is intended.
6.12EFFECTIVE DATE.This section is effective for assessment year 2010 and
6.13thereafter.

6.14    Sec. 9. Minnesota Statutes 2008, section 273.1232, subdivision 1, is amended to read:
6.15    Subdivision 1. Reassessments required. For the purposes of sections 273.1231 to
6.16273.1235 273.1236, the county assessor must reassess all damaged property in a disaster
6.17or emergency area, except that the commissioner of revenue shall reassess all property
6.18for which an application is submitted to the commissioner under section 273.1233 or
6.19273.1235 . As soon as practical, the assessor or commissioner of revenue must report
6.20the reassessed value to the county auditor.
6.21EFFECTIVE DATE.This section is effective for assessment year 2010 and
6.22thereafter.

6.23    Sec. 10. [273.1236] DISASTER-DAMAGED HOMES; PARTIAL VALUATION
6.24EXCLUSION.
6.25(a) A homestead property that (1) sustained physical damage from a disaster or
6.26emergency resulting in a reassessed market value that is at least $15,000 less than the
6.27market value of the property established for the January 2 assessment in the year in which
6.28the damage occurred, (2) has been substantially restored or rebuilt by the end of the
6.29year following the year in which the damage occurred, (3) has a gross living area after
6.30reconstruction that does not exceed 130 percent of the gross living area prior to the disaster
6.31or emergency, and (4) has an estimated market value for the assessment year following the
6.32year in which the restoration or reconstruction was substantially completed that exceeds
7.1its estimated market value established for the January 2 assessment in the year in which
7.2the damage occurred by at least $25,000 due to the restoration or reconstruction, is eligible
7.3for a valuation exclusion under this section for the two assessment years immediately
7.4following the year in which the restoration or reconstruction was completed.
7.5(b) The assessor shall determine the difference between the estimated market value
7.6established for the January 2 assessment in the year in which the damage occurred and the
7.7estimated market value established for the January 2 assessment in the year following the
7.8completion of the restoration or reconstruction.
7.9(c) In the first assessment year following the restoration or reconstruction, all of the
7.10difference identified under paragraph (b) shall be excluded in determining taxable market
7.11value. In the second assessment year following the restoration or reconstruction, half of
7.12the difference identified under paragraph (b) shall be excluded in determining taxable
7.13market value.
7.14(d) For the purposes of this section, "gross living area" includes only above-grade
7.15living area, and does not include any finished basement living area.
7.16(e) Application for the valuation exclusion under this section must be filed by
7.17January 2 of the year following the year in which the restoration or reconstruction was
7.18substantially completed. The application must be filed with the assessor of the county in
7.19which the property is located on the form prescribed by the commissioner of revenue.
7.20EFFECTIVE DATE.This section is effective for assessment year 2010 and
7.21thereafter. The application deadline in paragraph (e) is extended to June 30, 2010, for
7.22restoration or reconstruction substantially completed in 2009.

7.23    Sec. 11. Minnesota Statutes 2008, section 273.124, subdivision 1, is amended to read:
7.24    Subdivision 1. General rule. (a) Residential real estate that is occupied and used
7.25for the purposes of a homestead by its owner, who must be a Minnesota resident, is
7.26a residential homestead.
7.27    Agricultural land, as defined in section 273.13, subdivision 23, that is occupied and
7.28used as a homestead by its owner, who must be a Minnesota resident, is an agricultural
7.29homestead.
7.30    Dates for establishment of a homestead and homestead treatment provided to
7.31particular types of property are as provided in this section.
7.32    Property held by a trustee under a trust is eligible for homestead classification if the
7.33requirements under this chapter are satisfied.
7.34    The assessor shall require proof, as provided in subdivision 13, of the facts upon
7.35which classification as a homestead may be determined. Notwithstanding any other law,
8.1the assessor may at any time require a homestead application to be filed in order to verify
8.2that any property classified as a homestead continues to be eligible for homestead status.
8.3Notwithstanding any other law to the contrary, the Department of Revenue may, upon
8.4request from an assessor, verify whether an individual who is requesting or receiving
8.5homestead classification has filed a Minnesota income tax return as a resident for the most
8.6recent taxable year for which the information is available.
8.7    When there is a name change or a transfer of homestead property, the assessor may
8.8reclassify the property in the next assessment unless a homestead application is filed to
8.9verify that the property continues to qualify for homestead classification.
8.10    (b) For purposes of this section, homestead property shall include property which
8.11is used for purposes of the homestead but is separated from the homestead by a road,
8.12street, lot, waterway, or other similar intervening property. The term "used for purposes
8.13of the homestead" shall include but not be limited to uses for gardens, garages, or other
8.14outbuildings commonly associated with a homestead, but shall not include vacant land
8.15held primarily for future development. In order to receive homestead treatment for
8.16the noncontiguous property, the owner must use the property for the purposes of the
8.17homestead, and must apply to the assessor, both by the deadlines given in subdivision
8.189. After initial qualification for the homestead treatment, additional applications for
8.19subsequent years are not required.
8.20    (c) Residential real estate that is occupied and used for purposes of a homestead by a
8.21relative of the owner is a homestead but only to the extent of the homestead treatment
8.22that would be provided if the related owner occupied the property. For purposes of this
8.23paragraph and paragraph (g), "relative" means a parent, stepparent, child, stepchild,
8.24grandparent, grandchild, brother, sister, uncle, aunt, nephew, or niece. This relationship
8.25may be by blood or marriage. Property that has been classified as seasonal residential
8.26recreational property at any time during which it has been owned by the current owner or
8.27spouse of the current owner will not be reclassified as a homestead unless it is occupied as
8.28a homestead by the owner; this prohibition also applies to property that, in the absence of
8.29this paragraph, would have been classified as seasonal residential recreational property at
8.30the time when the residence was constructed. Neither the related occupant nor the owner
8.31of the property may claim a property tax refund under chapter 290A for a homestead
8.32occupied by a relative. In the case of a residence located on agricultural land, only the
8.33house, garage, and immediately surrounding one acre of land shall be classified as a
8.34homestead under this paragraph, except as provided in paragraph (d). In the case of
8.35nonagricultural property, this paragraph only applies to applications approved before
8.36December 16, 2010.
9.1    (d) Agricultural property that is occupied and used for purposes of a homestead by
9.2a relative of the owner, is a homestead, only to the extent of the homestead treatment
9.3that would be provided if the related owner occupied the property, and only if all of the
9.4following criteria are met:
9.5    (1) the relative who is occupying the agricultural property is a son, daughter, brother,
9.6sister, grandson, granddaughter, father, or mother of the owner of the agricultural property
9.7or a son, daughter, brother, sister, grandson, or granddaughter of the spouse of the owner
9.8of the agricultural property;
9.9    (2) the owner of the agricultural property must be a Minnesota resident;
9.10    (3) the owner of the agricultural property must not receive homestead treatment on
9.11any other agricultural property in Minnesota; and
9.12    (4) the owner of the agricultural property is limited to only one agricultural
9.13homestead per family under this paragraph.
9.14    Neither the related occupant nor the owner of the property may claim a property
9.15tax refund under chapter 290A for a homestead occupied by a relative qualifying under
9.16this paragraph. For purposes of this paragraph, "agricultural property" means the house,
9.17garage, other farm buildings and structures, and agricultural land.
9.18    Application must be made to the assessor by the owner of the agricultural property to
9.19receive homestead benefits under this paragraph. The assessor may require the necessary
9.20proof that the requirements under this paragraph have been met.
9.21    (e) In the case of property owned by a property owner who is married, the assessor
9.22must not deny homestead treatment in whole or in part if only one of the spouses occupies
9.23the property and the other spouse is absent due to: (1) marriage dissolution proceedings,
9.24(2) legal separation, (3) employment or self-employment in another location, or (4) other
9.25personal circumstances causing the spouses to live separately, not including an intent to
9.26obtain two homestead classifications for property tax purposes. To qualify under clause
9.27(3), the spouse's place of employment or self-employment must be at least 50 miles distant
9.28from the other spouse's place of employment, and the homesteads must be at least 50 miles
9.29distant from each other. Homestead treatment, in whole or in part, shall not be denied to
9.30the owner's spouse who previously occupied the residence with the owner if the absence
9.31of the owner is due to one of the exceptions provided in this paragraph.
9.32    (f) The assessor must not deny homestead treatment in whole or in part if:
9.33    (1) in the case of a property owner who is not married, the owner is absent due to
9.34residence in a nursing home, boarding care facility, or an elderly assisted living facility
9.35property as defined in section 273.13, subdivision 25a, and the property is not otherwise
9.36occupied; or
10.1    (2) in the case of a property owner who is married, the owner or the owner's spouse
10.2or both are absent due to residence in a nursing home, boarding care facility, or an elderly
10.3assisted living facility property as defined in section 273.13, subdivision 25a, and the
10.4property is not occupied or is occupied only by the owner's spouse.
10.5    (g) If an individual is purchasing property with the intent of claiming it as a
10.6homestead and is required by the terms of the financing agreement to have a relative
10.7shown on the deed as a co-owner, the assessor shall allow a full homestead classification.
10.8This provision only applies to first-time purchasers, whether married or single, or to a
10.9person who had previously been married and is purchasing as a single individual for the
10.10first time. The application for homestead benefits must be on a form prescribed by the
10.11commissioner and must contain the data necessary for the assessor to determine if full
10.12homestead benefits are warranted.
10.13    (h) If residential or agricultural real estate is occupied and used for purposes of a
10.14homestead by a child of a deceased owner and the property is subject to jurisdiction of
10.15probate court, the child shall receive relative homestead classification under paragraph (c)
10.16or (d) to the same extent they would be entitled to it if the owner was still living, until
10.17the probate is completed. For purposes of this paragraph, "child" includes a relationship
10.18by blood or by marriage.
10.19    (i) If a single-family home, duplex, or triplex classified as either residential
10.20homestead or agricultural homestead is also used to provide licensed child care, the
10.21portion of the property used for licensed child care must be classified as a part of the
10.22homestead property.
10.23EFFECTIVE DATE.This section is effective the day following final enactment.

10.24    Sec. 12. Minnesota Statutes 2009 Supplement, section 273.124, subdivision 3a,
10.25is amended to read:
10.26    Subd. 3a. Manufactured home park cooperative. (a) When a manufactured home
10.27park is owned by a corporation or association organized under chapter 308A or 308B,
10.28and each person who owns a share or shares in the corporation or association is entitled
10.29to occupy a lot within the park, the corporation or association may claim homestead
10.30treatment for each lot occupied by a shareholder the park. Each lot must be designated
10.31by legal description or number, and each lot is limited to not more than one-half acre of
10.32land for each homestead.
10.33(b) The manufactured home park shall be valued and assessed as if it were
10.34homestead property within class 1 entitled to homestead treatment if all of the following
10.35criteria are met:
11.1(1) the occupant is using the property as a permanent residence;
11.2(2) the occupant or the cooperative corporation or association is paying the ad
11.3valorem property taxes and any special assessments levied against the land and structure
11.4either directly, or indirectly through dues to the corporation or association; and
11.5(3) (2) the corporation or association organized under chapter 308A or 308B is
11.6wholly owned by persons having a right to occupy a lot owned by the corporation or
11.7association.
11.8(c) A charitable corporation, organized under the laws of Minnesota with no
11.9outstanding stock, and granted a ruling by the Internal Revenue Service for 501(c)(3)
11.10tax-exempt status, qualifies for homestead treatment with respect to member residents of
11.11the a manufactured home park who if its members hold residential participation warrants
11.12entitling them to occupy a lot in the manufactured home park.
11.13(d) "Homestead treatment" under this subdivision means the class rate provided for
11.14class 4c property classified under section 273.13, subdivision 25, paragraph (d), clause (5),
11.15item (ii). The homestead market value credit under section 273.1384 does not apply and
11.16the property taxes assessed against the park shall not be included in the determination of
11.17taxes payable for rent paid under section 290A.03.
11.18EFFECTIVE DATE.This section is effective for taxes payable in 2011 and
11.19thereafter.

11.20    Sec. 13. Minnesota Statutes 2008, section 273.124, subdivision 8, is amended to read:
11.21    Subd. 8. Homestead owned by or leased to family farm corporation, joint farm
11.22venture, limited liability company, or partnership. (a) Each family farm corporation;
11.23each joint family farm venture; and each limited liability company or partnership which
11.24operates a family farm; is entitled to class 1b under section 273.13, subdivision 22,
11.25paragraph (b), or class 2a assessment for one homestead occupied by a shareholder,
11.26member, or partner thereof who is residing on the land, and actively engaged in farming of
11.27the land owned by the family farm corporation, joint family farm venture, limited liability
11.28company, or partnership. Homestead treatment applies even if legal title to the property is
11.29in the name of the family farm corporation, joint family farm venture, limited liability
11.30company, or partnership, and not in the name of the person residing on it.
11.31"Family farm corporation," "family farm," and "partnership operating a family
11.32farm" have the meanings given in section 500.24, except that the number of allowable
11.33shareholders, members, or partners under this subdivision shall not exceed 12. "Limited
11.34liability company" has the meaning contained in sections 322B.03, subdivision 28, and
11.35500.24, subdivision 2 , paragraphs (l) and (m). "Joint family farm venture" means a
12.1cooperative agreement among two or more farm enterprises authorized to operate a family
12.2farm under section 500.24.
12.3(b) In addition to property specified in paragraph (a), any other residences owned
12.4by family farm corporations, joint family farm ventures, limited liability companies,
12.5or partnerships described in paragraph (a) which are located on agricultural land and
12.6occupied as homesteads by its shareholders, members, or partners who are actively
12.7engaged in farming on behalf of that corporation, joint farm venture, limited liability
12.8company, or partnership must also be assessed as class 2a property or as class 1b property
12.9under section 273.13.
12.10(c) Agricultural property that is owned by a member, partner, or shareholder of a
12.11family farm corporation or joint family farm venture, limited liability company operating
12.12a family farm, or by a partnership operating a family farm and leased to the family farm
12.13corporation, limited liability company, partnership, or joint farm venture, as defined in
12.14paragraph (a), is eligible for classification as class 1b or class 2a under section 273.13, if
12.15the owner is actually residing on the property, and is actually engaged in farming the land
12.16on behalf of that corporation, joint farm venture, limited liability company, or partnership.
12.17This paragraph applies without regard to any legal possession rights of the family farm
12.18corporation, joint family farm venture, limited liability company, or partnership under
12.19the lease.
12.20(d) Agricultural property that (1) is owned by a family farm corporation, joint
12.21farm venture, limited liability company, or partnership and (2) is contiguous to a class
12.222a homestead under section 273.13, subdivision 23, or if noncontiguous, is located in
12.23the same township or city, or not farther than four townships or cities, or combination
12.24thereof from a class 2a homestead, and the class 2a homestead is owned by one of the
12.25shareholders, members, or partners; is entitled to receive the first tier homestead class rate
12.26up to the first tier maximum market value on any remaining market value not received
12.27on the shareholder's, member's, or partner's homestead class 2a property. The owner
12.28must notify the county assessor by July 1 that a portion of the market value under this
12.29subdivision may be eligible for homestead classification for the current assessment year,
12.30for taxes payable in the following year.
12.31EFFECTIVE DATE.This section is effective for assessment year 2010 and
12.32thereafter, for taxes payable in 2011 and thereafter.

12.33    Sec. 14. Minnesota Statutes 2008, section 273.124, subdivision 14, is amended to read:
13.1    Subd. 14. Agricultural homesteads; special provisions. (a) Real estate of less than
13.2ten acres that is the homestead of its owner must be classified as class 2a under section
13.3273.13, subdivision 23 , paragraph (a), if:
13.4    (1) the parcel on which the house is located is contiguous on at least two sides to (i)
13.5agricultural land, (ii) land owned or administered by the United States Fish and Wildlife
13.6Service, or (iii) land administered by the Department of Natural Resources on which in
13.7lieu taxes are paid under sections 477A.11 to 477A.14;
13.8    (2) its owner also owns a noncontiguous parcel of agricultural land that is at least
13.920 acres;
13.10    (3) the noncontiguous land is located not farther than four townships or cities, or a
13.11combination of townships or cities from the homestead; and
13.12    (4) the agricultural use value of the noncontiguous land and farm buildings is equal
13.13to at least 50 percent of the market value of the house, garage, and one acre of land.
13.14    Homesteads initially classified as class 2a under the provisions of this paragraph shall
13.15remain classified as class 2a, irrespective of subsequent changes in the use of adjoining
13.16properties, as long as the homestead remains under the same ownership, the owner owns a
13.17noncontiguous parcel of agricultural land that is at least 20 acres, and the agricultural use
13.18value qualifies under clause (4). Homestead classification under this paragraph is limited
13.19to property that qualified under this paragraph for the 1998 assessment.
13.20    (b)(i) Agricultural property shall be classified as the owner's homestead, to the same
13.21extent as other agricultural homestead property, if all of the following criteria are met:
13.22    (1) the property consists of at least 40 acres including undivided government lots
13.23and correctional 40's;
13.24    (2) the owner, the owner's spouse, the son or daughter of the owner or owner's
13.25spouse, the brother or sister of the owner or owner's spouse, or the grandson or
13.26granddaughter of the owner or the owner's spouse, is actively farming the agricultural
13.27property, either on the person's own behalf as an individual or on behalf of a partnership
13.28operating a family farm, family farm corporation, joint family farm venture, or limited
13.29liability company of which the person is a partner, shareholder, or member;
13.30    (3) both the owner of the agricultural property and the person who is actively
13.31farming the agricultural property under clause (2), are Minnesota residents;
13.32    (4) neither the owner nor the spouse of the owner claims another agricultural
13.33homestead in Minnesota; and
13.34    (5) neither the owner nor the person actively farming the property lives farther
13.35than four townships or cities, or a combination of four townships or cities, from the
13.36agricultural property, except that if the owner or the owner's spouse is required to live in
14.1employer-provided housing, the owner or owner's spouse, whichever is actively farming
14.2the agricultural property, may live more than four townships or cities, or combination of
14.3four townships or cities from the agricultural property.
14.4    The relationship under this paragraph may be either by blood or marriage.
14.5    (ii) Real property held by a trustee under a trust is eligible for agricultural homestead
14.6classification under this paragraph if the qualifications in clause (i) are met, except that
14.7"owner" means the grantor of the trust.
14.8    (iii) Property containing the residence of an owner who owns qualified property
14.9under clause (i) shall be classified as part of the owner's agricultural homestead, if that
14.10property is also used for noncommercial storage or drying of agricultural crops.
14.11    (c) Noncontiguous land shall be included as part of a homestead under section
14.12273.13, subdivision 23 , paragraph (a), only if the homestead is classified as class 2a
14.13and the detached land is located in the same township or city, or not farther than four
14.14townships or cities or combination thereof from the homestead. Any taxpayer of these
14.15noncontiguous lands must notify the county assessor that the noncontiguous land is part of
14.16the taxpayer's homestead, and, if the homestead is located in another county, the taxpayer
14.17must also notify the assessor of the other county.
14.18    (d) Agricultural land used for purposes of a homestead and actively farmed by a
14.19person holding a vested remainder interest in it must be classified as a homestead under
14.20section 273.13, subdivision 23, paragraph (a). If agricultural land is classified class 2a,
14.21any other dwellings on the land used for purposes of a homestead by persons holding
14.22vested remainder interests who are actively engaged in farming the property, and up to
14.23one acre of the land surrounding each homestead and reasonably necessary for the use of
14.24the dwelling as a home, must also be assessed class 2a.
14.25    (e) Agricultural land and buildings that were class 2a homestead property under
14.26section 273.13, subdivision 23, paragraph (a), for the 1997 assessment shall remain
14.27classified as agricultural homesteads for subsequent assessments if:
14.28    (1) the property owner abandoned the homestead dwelling located on the agricultural
14.29homestead as a result of the April 1997 floods;
14.30    (2) the property is located in the county of Polk, Clay, Kittson, Marshall, Norman,
14.31or Wilkin;
14.32    (3) the agricultural land and buildings remain under the same ownership for the
14.33current assessment year as existed for the 1997 assessment year and continue to be used
14.34for agricultural purposes;
14.35    (4) the dwelling occupied by the owner is located in Minnesota and is within 30
14.36miles of one of the parcels of agricultural land that is owned by the taxpayer; and
15.1    (5) the owner notifies the county assessor that the relocation was due to the 1997
15.2floods, and the owner furnishes the assessor any information deemed necessary by the
15.3assessor in verifying the change in dwelling. Further notifications to the assessor are not
15.4required if the property continues to meet all the requirements in this paragraph and any
15.5dwellings on the agricultural land remain uninhabited.
15.6    (f) Agricultural land and buildings that were class 2a homestead property under
15.7section 273.13, subdivision 23, paragraph (a), for the 1998 assessment shall remain
15.8classified agricultural homesteads for subsequent assessments if:
15.9    (1) the property owner abandoned the homestead dwelling located on the agricultural
15.10homestead as a result of damage caused by a March 29, 1998, tornado;
15.11    (2) the property is located in the county of Blue Earth, Brown, Cottonwood,
15.12LeSueur, Nicollet, Nobles, or Rice;
15.13    (3) the agricultural land and buildings remain under the same ownership for the
15.14current assessment year as existed for the 1998 assessment year;
15.15    (4) the dwelling occupied by the owner is located in this state and is within 50 miles
15.16of one of the parcels of agricultural land that is owned by the taxpayer; and
15.17    (5) the owner notifies the county assessor that the relocation was due to a March 29,
15.181998, tornado, and the owner furnishes the assessor any information deemed necessary by
15.19the assessor in verifying the change in homestead dwelling. For taxes payable in 1999, the
15.20owner must notify the assessor by December 1, 1998. Further notifications to the assessor
15.21are not required if the property continues to meet all the requirements in this paragraph
15.22and any dwellings on the agricultural land remain uninhabited.
15.23    (g) Agricultural property of a family farm corporation, joint family farm venture,
15.24family farm limited liability company, or partnership operating a family farm as described
15.25under subdivision 8 shall be classified homestead, to the same extent as other agricultural
15.26homestead property, if all of the following criteria are met:
15.27    (1) the property consists of at least 40 acres including undivided government lots
15.28and correctional 40's;
15.29    (2) a shareholder, member, or partner of that entity is actively farming the
15.30agricultural property;
15.31    (3) that shareholder, member, or partner who is actively farming the agricultural
15.32property is a Minnesota resident;
15.33    (4) neither that shareholder, member, or partner, nor the spouse of that shareholder,
15.34member, or partner claims another agricultural homestead in Minnesota; and
15.35    (5) that shareholder, member, or partner does not live farther than four townships or
15.36cities, or a combination of four townships or cities, from the agricultural property.
16.1    Homestead treatment applies under this paragraph for property leased to a family
16.2farm corporation, joint farm venture, limited liability company, or partnership operating a
16.3family farm if legal title to the property is in the name of an individual who is a member,
16.4shareholder, or partner in the entity.
16.5    (h) To be eligible for the special agricultural homestead under this subdivision, an
16.6initial full application must be submitted to the county assessor where the property is
16.7located. Owners and the persons who are actively farming the property shall be required
16.8to complete only a one-page abbreviated version of the application in each subsequent
16.9year provided that none of the following items have changed since the initial application:
16.10    (1) the day-to-day operation, administration, and financial risks remain the same;
16.11    (2) the owners and the persons actively farming the property continue to live within
16.12the four townships or city criteria and are Minnesota residents;
16.13    (3) the same operator of the agricultural property is listed with the Farm Service
16.14Agency;
16.15    (4) a Schedule F or equivalent income tax form was filed for the most recent year;
16.16    (5) the property's acreage is unchanged; and
16.17    (6) none of the property's acres have been enrolled in a federal or state farm program
16.18since the initial application.
16.19    The owners and any persons who are actively farming the property must include
16.20the appropriate Social Security numbers, and sign and date the application. If any of the
16.21specified information has changed since the full application was filed, the owner must
16.22notify the assessor, and must complete a new application to determine if the property
16.23continues to qualify for the special agricultural homestead. The commissioner of revenue
16.24shall prepare a standard reapplication form for use by the assessors.
16.25    (i) Agricultural land and buildings that were class 2a homestead property under
16.26section 273.13, subdivision 23, paragraph (a), for the 2007 assessment shall remain
16.27classified agricultural homesteads for subsequent assessments if:
16.28    (1) the property owner abandoned the homestead dwelling located on the agricultural
16.29homestead as a result of damage caused by the August 2007 floods;
16.30    (2) the property is located in the county of Dodge, Fillmore, Houston, Olmsted,
16.31Steele, Wabasha, or Winona;
16.32    (3) the agricultural land and buildings remain under the same ownership for the
16.33current assessment year as existed for the 2007 assessment year;
16.34    (4) the dwelling occupied by the owner is located in this state and is within 50 miles
16.35of one of the parcels of agricultural land that is owned by the taxpayer; and
17.1    (5) the owner notifies the county assessor that the relocation was due to the August
17.22007 floods, and the owner furnishes the assessor any information deemed necessary by
17.3the assessor in verifying the change in homestead dwelling. For taxes payable in 2009, the
17.4owner must notify the assessor by December 1, 2008. Further notifications to the assessor
17.5are not required if the property continues to meet all the requirements in this paragraph
17.6and any dwellings on the agricultural land remain uninhabited.
17.7    (j) Agricultural land and buildings that were class 2a homestead property under
17.8section 273.13, subdivision 23, paragraph (a), for the 2008 assessment shall remain
17.9classified as agricultural homesteads for subsequent assessments if:
17.10    (1) the property owner abandoned the homestead dwelling located on the agricultural
17.11homestead as a result of the March 2009 floods;
17.12    (2) the property is located in the county of Marshall;
17.13    (3) the agricultural land and buildings remain under the same ownership for the
17.14current assessment year as existed for the 2008 assessment year and continue to be used
17.15for agricultural purposes;
17.16    (4) the dwelling occupied by the owner is located in Minnesota and is within 50
17.17miles of one of the parcels of agricultural land that is owned by the taxpayer; and
17.18    (5) the owner notifies the county assessor that the relocation was due to the 2009
17.19floods, and the owner furnishes the assessor any information deemed necessary by the
17.20assessor in verifying the change in dwelling. Further notifications to the assessor are not
17.21required if the property continues to meet all the requirements in this paragraph and any
17.22dwellings on the agricultural land remain uninhabited.
17.23EFFECTIVE DATE.This section is effective for assessment years 2010 and 2011,
17.24for taxes payable in 2011 and 2012.

17.25    Sec. 15. Minnesota Statutes 2009 Supplement, section 273.13, subdivision 23, is
17.26amended to read:
17.27    Subd. 23. Class 2. (a) An agricultural homestead consists of class 2a agricultural
17.28land that is homesteaded, along with any class 2b rural vacant land that is contiguous to
17.29the class 2a land under the same ownership. The market value of the house and garage
17.30and immediately surrounding one acre of land has the same class rates as class 1a or 1b
17.31property under subdivision 22. The value of the remaining land including improvements
17.32up to the first tier valuation limit of agricultural homestead property has a net class rate
17.33of 0.5 percent of market value. The remaining property over the first tier has a class rate
17.34of one percent of market value. For purposes of this subdivision, the "first tier valuation
18.1limit of agricultural homestead property" and "first tier" means the limit certified under
18.2section 273.11, subdivision 23.
18.3    (b) Class 2a agricultural land consists of parcels of property, or portions thereof, that
18.4are agricultural land and buildings. Class 2a property has a net class rate of one percent of
18.5market value, unless it is part of an agricultural homestead under paragraph (a). Class
18.62a property must also include any property that would otherwise be classified as 2b,
18.7but is interspersed with class 2a property, including but not limited to sloughs, wooded
18.8wind shelters, acreage abutting ditches, ravines, rock piles, land subject to a setback
18.9requirement, and other similar land that is impractical for the assessor to value separately
18.10from the rest of the property or that is unlikely to be able to be sold separately from
18.11the rest of the property.
18.12    An assessor may classify the part of a parcel described in this subdivision that is used
18.13for agricultural purposes as class 2a and the remainder in the class appropriate to its use.
18.14    (c) Class 2b rural vacant land consists of parcels of property, or portions thereof,
18.15that are unplatted real estate, rural in character and not used for agricultural purposes,
18.16including land used for growing trees for timber, lumber, and wood and wood products,
18.17that is not improved with a structure. The presence of a minor, ancillary nonresidential
18.18structure as defined by the commissioner of revenue does not disqualify the property from
18.19classification under this paragraph. Any parcel of 20 acres or more improved with a
18.20structure that is not a minor, ancillary nonresidential structure must be split-classified, and
18.21ten acres must be assigned to the split parcel containing the structure. Class 2b property
18.22has a net class rate of one percent of market value unless it is part of an agricultural
18.23homestead under paragraph (a), or qualifies as class 2c under paragraph (d).
18.24    (d) Class 2c managed forest land consists of no less than 20 and no more than 1,920
18.25acres statewide per taxpayer that is being managed under a forest management plan that
18.26meets the requirements of chapter 290C, but is not enrolled in the sustainable forest
18.27resource management incentive program. It has a class rate of .65 percent, provided that
18.28the owner of the property must apply to the assessor in order for the property to initially
18.29qualify for the reduced rate and provide the information required by the assessor to verify
18.30that the property qualifies for the reduced rate. If the assessor receives the application
18.31and information before May 1 in an assessment year, the property qualifies beginning
18.32with that assessment year. If the assessor receives the application and information after
18.33April 30 in an assessment year, the property may not qualify until the next assessment
18.34year. The commissioner of natural resources must concur that the land is qualified. The
18.35commissioner of natural resources shall annually provide county assessors verification
18.36information on a timely basis. The presence of a minor, ancillary nonresidential structure
19.1as defined by the commissioner of revenue does not disqualify the property from
19.2classification under this paragraph.
19.3    (e) Agricultural land as used in this section means contiguous acreage of ten
19.4acres or more, used during the preceding year for agricultural purposes. "Agricultural
19.5purposes" as used in this section means the raising, cultivation, drying, or storage of
19.6agricultural products for sale, or the storage of machinery or equipment used in support
19.7of agricultural production by the same farm entity. For a property to be classified as
19.8agricultural based only on the drying or storage of agricultural products, the products
19.9being dried or stored must have been produced by the same farm entity as the entity
19.10operating the drying or storage facility. "Agricultural purposes" also includes enrollment
19.11in the Reinvest in Minnesota program under sections 103F.501 to 103F.535 or the federal
19.12Conservation Reserve Program as contained in Public Law 99-198 or a similar state
19.13or federal conservation program if the property was classified as agricultural (i) under
19.14this subdivision for the assessment year 2002 or (ii) in the year prior to its enrollment.
19.15Agricultural classification shall not be based upon the market value of any residential
19.16structures on the parcel or contiguous parcels under the same ownership.
19.17    (f) Real estate of less than ten acres, which is exclusively or intensively used for
19.18raising or cultivating agricultural products, shall be considered as agricultural land. To
19.19qualify under this paragraph, property that includes a residential structure must be used
19.20intensively for one of the following purposes:
19.21    (i) for drying or storage of grain or storage of machinery or equipment used to
19.22support agricultural activities on other parcels of property operated by the same farming
19.23entity;
19.24    (ii) as a nursery, provided that only those acres used to produce nursery stock are
19.25considered agricultural land;
19.26    (iii) for livestock or poultry confinement, provided that land that is used only for
19.27pasturing and grazing does not qualify; or
19.28    (iv) for market farming; for purposes of this paragraph, "market farming" means the
19.29cultivation of one or more fruits or vegetables or production of animal or other agricultural
19.30products for sale to local markets by the farmer or an organization with which the farmer
19.31is affiliated.; or
19.32(v) the commercial processing of milk into cheese products from milk produced
19.33on the property.
19.34    (g) Land shall be classified as agricultural even if all or a portion of the agricultural
19.35use of that property is the leasing to, or use by another person for agricultural purposes.
20.1    Classification under this subdivision is not determinative for qualifying under
20.2section 273.111.
20.3    (h) The property classification under this section supersedes, for property tax
20.4purposes only, any locally administered agricultural policies or land use restrictions that
20.5define minimum or maximum farm acreage.
20.6    (i) The term "agricultural products" as used in this subdivision includes production
20.7for sale of:
20.8    (1) livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing
20.9animals, horticultural and nursery stock, fruit of all kinds, vegetables, forage, grains,
20.10bees, and apiary products by the owner;
20.11    (2) fish bred for sale and consumption if the fish breeding occurs on land zoned
20.12for agricultural use;
20.13    (3) the commercial boarding of horses, which may include related horse training
20.14and riding instruction, if the boarding is done in conjunction with on property that is also
20.15used for raising pasture to graze horses or raising or cultivating other agricultural products
20.16as defined in clause (1);
20.17    (4) property which is owned and operated by nonprofit organizations used for
20.18equestrian activities, excluding racing;
20.19    (5) game birds and waterfowl bred and raised for use on a shooting preserve licensed
20.20under section 97A.115;
20.21    (6) insects primarily bred to be used as food for animals;
20.22    (7) trees, grown for sale as a crop, including short rotation woody crops, and not
20.23sold for timber, lumber, wood, or wood products; and
20.24    (8) maple syrup taken from trees grown by a person licensed by the Minnesota
20.25Department of Agriculture under chapter 28A as a food processor.; and
20.26(9) the commercial processing of milk into cheese products from milk produced on
20.27the property, provided the property is also the homestead of the property owner.
20.28    (j) If a parcel used for agricultural purposes is also used for commercial or industrial
20.29purposes, including but not limited to:
20.30    (1) wholesale and retail sales;
20.31    (2) processing of raw agricultural products or other goods;
20.32    (3) warehousing or storage of processed goods; and
20.33    (4) office facilities for the support of the activities enumerated in clauses (1), (2),
20.34and (3),
20.35the assessor shall classify the part of the parcel used for agricultural purposes as class
20.361b, 2a, or 2b, whichever is appropriate, and the remainder in the class appropriate to its
21.1use. The grading, sorting, and packaging of raw agricultural products for first sale is
21.2considered an agricultural purpose. A greenhouse or other building where horticultural
21.3or nursery products are grown that is also used for the conduct of retail sales must be
21.4classified as agricultural if it is primarily used for the growing of horticultural or nursery
21.5products from seed, cuttings, or roots and occasionally as a showroom for the retail sale of
21.6those products. Use of a greenhouse or building only for the display of already grown
21.7horticultural or nursery products does not qualify as an agricultural purpose.
21.8    (k) The assessor shall determine and list separately on the records the market value
21.9of the homestead dwelling and the one acre of land on which that dwelling is located. If
21.10any farm buildings or structures are located on this homesteaded acre of land, their market
21.11value shall not be included in this separate determination.
21.12    (l) Class 2d airport landing area consists of a landing area or public access area of
21.13a privately owned public use airport. It has a class rate of one percent of market value.
21.14To qualify for classification under this paragraph, a privately owned public use airport
21.15must be licensed as a public airport under section 360.018. For purposes of this paragraph,
21.16"landing area" means that part of a privately owned public use airport properly cleared,
21.17regularly maintained, and made available to the public for use by aircraft and includes
21.18runways, taxiways, aprons, and sites upon which are situated landing or navigational aids.
21.19A landing area also includes land underlying both the primary surface and the approach
21.20surfaces that comply with all of the following:
21.21    (i) the land is properly cleared and regularly maintained for the primary purposes of
21.22the landing, taking off, and taxiing of aircraft; but that portion of the land that contains
21.23facilities for servicing, repair, or maintenance of aircraft is not included as a landing area;
21.24    (ii) the land is part of the airport property; and
21.25    (iii) the land is not used for commercial or residential purposes.
21.26The land contained in a landing area under this paragraph must be described and certified
21.27by the commissioner of transportation. The certification is effective until it is modified,
21.28or until the airport or landing area no longer meets the requirements of this paragraph.
21.29For purposes of this paragraph, "public access area" means property used as an aircraft
21.30parking ramp, apron, or storage hangar, or an arrival and departure building in connection
21.31with the airport.
21.32    (m) Class 2e consists of land with a commercial aggregate deposit that is not actively
21.33being mined and is not otherwise classified as class 2a or 2b, provided that the land is not
21.34located in a county that has elected to opt-out of the aggregate preservation program as
21.35provided in section 273.1115, subdivision 6. It has a class rate of one percent of market
21.36value. To qualify for classification under this paragraph, the property must be at least
22.1ten contiguous acres in size and the owner of the property must record with the county
22.2recorder of the county in which the property is located an affidavit containing:
22.3    (1) a legal description of the property;
22.4    (2) a disclosure that the property contains a commercial aggregate deposit that is not
22.5actively being mined but is present on the entire parcel enrolled;
22.6    (3) documentation that the conditional use under the county or local zoning
22.7ordinance of this property is for mining; and
22.8    (4) documentation that a permit has been issued by the local unit of government
22.9or the mining activity is allowed under local ordinance. The disclosure must include a
22.10statement from a registered professional geologist, engineer, or soil scientist delineating
22.11the deposit and certifying that it is a commercial aggregate deposit.
22.12    For purposes of this section and section 273.1115, "commercial aggregate deposit"
22.13means a deposit that will yield crushed stone or sand and gravel that is suitable for use
22.14as a construction aggregate; and "actively mined" means the removal of top soil and
22.15overburden in preparation for excavation or excavation of a commercial deposit.
22.16    (n) When any portion of the property under this subdivision or subdivision 22 begins
22.17to be actively mined, the owner must file a supplemental affidavit within 60 days from
22.18the day any aggregate is removed stating the number of acres of the property that is
22.19actively being mined. The acres actively being mined must be (1) valued and classified
22.20under subdivision 24 in the next subsequent assessment year, and (2) removed from the
22.21aggregate resource preservation property tax program under section 273.1115, if the
22.22land was enrolled in that program. Copies of the original affidavit and all supplemental
22.23affidavits must be filed with the county assessor, the local zoning administrator, and the
22.24Department of Natural Resources, Division of Land and Minerals. A supplemental
22.25affidavit must be filed each time a subsequent portion of the property is actively mined,
22.26provided that the minimum acreage change is five acres, even if the actual mining activity
22.27constitutes less than five acres.
22.28(o) The definitions prescribed by the commissioner under paragraphs (c) and (d) are
22.29not rules and are exempt from the rulemaking provisions of chapter 14, and the provisions
22.30in section 14.386 concerning exempt rules do not apply.
22.31EFFECTIVE DATE.This section is effective for taxes payable in 2011 and
22.32thereafter.

22.33    Sec. 16. Minnesota Statutes 2009 Supplement, section 273.13, subdivision 25, is
22.34amended to read:
23.1    Subd. 25. Class 4. (a) Class 4a is residential real estate containing four or more
23.2units and used or held for use by the owner or by the tenants or lessees of the owner
23.3as a residence for rental periods of 30 days or more, excluding property qualifying for
23.4class 4d. Class 4a also includes hospitals licensed under sections 144.50 to 144.56, other
23.5than hospitals exempt under section 272.02, and contiguous property used for hospital
23.6purposes, without regard to whether the property has been platted or subdivided. The
23.7market value of class 4a property has a class rate of 1.25 percent.
23.8    (b) Class 4b includes:
23.9    (1) residential real estate containing less than four units that does not qualify as class
23.104bb, other than seasonal residential recreational property;
23.11    (2) manufactured homes not classified under any other provision;
23.12    (3) a dwelling, garage, and surrounding one acre of property on a nonhomestead
23.13farm classified under subdivision 23, paragraph (b) containing two or three units; and
23.14    (4) unimproved property that is classified residential as determined under subdivision
23.1533.
23.16    The market value of class 4b property has a class rate of 1.25 percent.
23.17    (c) Class 4bb includes:
23.18    (1) nonhomestead residential real estate containing one unit, other than seasonal
23.19residential recreational property; and
23.20    (2) a single family dwelling, garage, and surrounding one acre of property on a
23.21nonhomestead farm classified under subdivision 23, paragraph (b).
23.22    Class 4bb property has the same class rates as class 1a property under subdivision 22.
23.23    Property that has been classified as seasonal residential recreational property at
23.24any time during which it has been owned by the current owner or spouse of the current
23.25owner does not qualify for class 4bb.
23.26    (d) Class 4c property includes:
23.27    (1) except as provided in subdivision 22, paragraph (c), real and personal property
23.28devoted to temporary and seasonal residential occupancy for recreation purposes,
23.29including real and personal property devoted to temporary and seasonal residential
23.30occupancy for recreation purposes and not devoted to commercial purposes for more
23.31than 250 days in the year preceding the year of assessment. For purposes of this clause,
23.32property is devoted to a commercial purpose on a specific day if any portion of the
23.33property is used for residential occupancy, and a fee is charged for residential occupancy.
23.34Class 4c property under this clause must contain three or more rental units. A "rental unit"
23.35is defined as a cabin, condominium, townhouse, sleeping room, or individual camping site
23.36equipped with water and electrical hookups for recreational vehicles. Class 4c property
24.1under this clause must provide recreational activities such as renting ice fishing houses,
24.2boats and motors, snowmobiles, downhill or cross-country ski equipment; provide marina
24.3services, launch services, or guide services; or sell bait and fishing tackle. A camping pad
24.4offered for rent by a property that otherwise qualifies for class 4c under this clause is also
24.5class 4c under this clause regardless of the term of the rental agreement, as long as the
24.6use of the camping pad does not exceed 250 days. In order for a property to be classified
24.7as class 4c, seasonal residential recreational for commercial purposes under this clause,
24.8(i) at least 40 percent of the annual gross lodging receipts related to the property must be
24.9from business conducted during 90 consecutive days and either (i) (A) at least 60 percent
24.10of all paid bookings by lodging guests during the year must be for periods of at least
24.11two consecutive nights; or (ii) (B) at least 20 percent of the annual gross receipts must
24.12be from charges for rental of fish houses, boats and motors, snowmobiles, downhill or
24.13cross-country ski equipment, or charges for marina services, launch services, and guide
24.14services, or the sale of bait and fishing tackle.; or (ii) the property contains 20 or fewer
24.15rental units, is devoted to temporary residential occupancy for no more than 250 days in
24.16the year, is located in a township or a city with a population of 2,500 or less, that is located
24.17outside the metropolitan area as defined under section 473.121, subdivision 2, and that
24.18contains a portion of a state trail administered by the Department of Natural Resources.
24.19For purposes of this determination, a paid booking of five or more nights shall be counted
24.20as two bookings. Class 4c property classified under this clause also includes commercial
24.21use real property used exclusively for recreational purposes in conjunction with other
24.22class 4c property classified under this clause and devoted to temporary and seasonal
24.23residential occupancy for recreational purposes, up to a total of two acres, provided the
24.24property is not devoted to commercial recreational use for more than 250 days in the year
24.25preceding the year of assessment and is located within two miles of the class 4c property
24.26with which it is used. Owners of real and personal property devoted to temporary and
24.27seasonal residential occupancy for recreation purposes and all or a portion of which was
24.28devoted to commercial purposes for not more than 250 days in the year preceding the
24.29year of assessment desiring classification as class 4c, must submit a declaration to the
24.30assessor designating the cabins or units occupied for 250 days or less in the year preceding
24.31the year of assessment by January 15 of the assessment year. Those cabins or units and
24.32a proportionate share of the land on which they are located must be designated class
24.334c under this clause as otherwise provided. The remainder of the cabins or units and a
24.34proportionate share of the land on which they are located will be designated as class 3a.
24.35The owner of property desiring designation as class 4c property under this clause must
24.36provide guest registers or other records demonstrating that the units for which class 4c
25.1designation is sought were not occupied for more than 250 days in the year preceding the
25.2assessment if so requested. The portion of a property operated as a (1) restaurant, (2) bar,
25.3(3) gift shop, (4) conference center or meeting room, and (5) other nonresidential facility
25.4operated on a commercial basis not directly related to temporary and seasonal residential
25.5occupancy for recreation purposes does not qualify for class 4c;
25.6    (2) qualified property used as a golf course if:
25.7    (i) it is open to the public on a daily fee basis. It may charge membership fees or
25.8dues, but a membership fee may not be required in order to use the property for golfing,
25.9and its green fees for golfing must be comparable to green fees typically charged by
25.10municipal courses; and
25.11    (ii) it meets the requirements of section 273.112, subdivision 3, paragraph (d).
25.12    A structure used as a clubhouse, restaurant, or place of refreshment in conjunction
25.13with the golf course is classified as class 3a property;
25.14    (3) real property up to a maximum of three acres of land owned and used by a
25.15nonprofit community service oriented organization and not used for residential purposes
25.16on either a temporary or permanent basis, provided that:
25.17    (i) the property is not used for a revenue-producing activity for more than six days
25.18in the calendar year preceding the year of assessment; or
25.19    (ii) the organization makes annual charitable contributions and donations at least
25.20equal to the property's previous year's property taxes and the property is allowed to be
25.21used for public and community meetings or events for no charge, as appropriate to the
25.22size of the facility.
25.23    For purposes of this clause,
25.24    (A) "charitable contributions and donations" has the same meaning as lawful
25.25gambling purposes under section 349.12, subdivision 25, excluding those purposes
25.26relating to the payment of taxes, assessments, fees, auditing costs, and utility payments;
25.27    (B) "property taxes" excludes the state general tax;
25.28    (C) a "nonprofit community service oriented organization" means any corporation,
25.29society, association, foundation, or institution organized and operated exclusively for
25.30charitable, religious, fraternal, civic, or educational purposes, and which is exempt from
25.31federal income taxation pursuant to section 501(c)(3), (8), (10), or (19) of the Internal
25.32Revenue Code; and
25.33    (D) "revenue-producing activities" shall include but not be limited to property or that
25.34portion of the property that is used as an on-sale intoxicating liquor or 3.2 percent malt
25.35liquor establishment licensed under chapter 340A, a restaurant open to the public, bowling
25.36alley, a retail store, gambling conducted by organizations licensed under chapter 349, an
26.1insurance business, or office or other space leased or rented to a lessee who conducts a
26.2for-profit enterprise on the premises.
26.3Any portion of the property not qualifying under either item (i) or (ii) is class 3a. The use
26.4of the property for social events open exclusively to members and their guests for periods
26.5of less than 24 hours, when an admission is not charged nor any revenues are received by
26.6the organization shall not be considered a revenue-producing activity.
26.7    The organization shall maintain records of its charitable contributions and donations
26.8and of public meetings and events held on the property and make them available upon
26.9request any time to the assessor to ensure eligibility. An organization meeting the
26.10requirement under item (ii) must file an application by May 1 with the assessor for
26.11eligibility for the current year's assessment. The commissioner shall prescribe a uniform
26.12application form and instructions;
26.13    (4) postsecondary student housing of not more than one acre of land that is owned by
26.14a nonprofit corporation organized under chapter 317A and is used exclusively by a student
26.15cooperative, sorority, or fraternity for on-campus housing or housing located within two
26.16miles of the border of a college campus;
26.17    (5)(i) manufactured home parks as defined in section 327.14, subdivision 3,
26.18excluding manufactured home parks described in section 273.124, subdivision 3a, and (ii)
26.19manufactured home parks as defined in section 327.14, subdivision 3, that are described in
26.20section 273.124, subdivision 3a;
26.21    (6) real property that is actively and exclusively devoted to indoor fitness, health,
26.22social, recreational, and related uses, is owned and operated by a not-for-profit corporation,
26.23and is located within the metropolitan area as defined in section 473.121, subdivision 2;
26.24    (7) a leased or privately owned noncommercial aircraft storage hangar not exempt
26.25under section 272.01, subdivision 2, and the land on which it is located, provided that:
26.26    (i) the land is on an airport owned or operated by a city, town, county, Metropolitan
26.27Airports Commission, or group thereof; and
26.28    (ii) the land lease, or any ordinance or signed agreement restricting the use of the
26.29leased premise, prohibits commercial activity performed at the hangar.
26.30    If a hangar classified under this clause is sold after June 30, 2000, a bill of sale must
26.31be filed by the new owner with the assessor of the county where the property is located
26.32within 60 days of the sale;
26.33    (8) a privately owned noncommercial aircraft storage hangar not exempt under
26.34section 272.01, subdivision 2, and the land on which it is located, provided that:
26.35    (i) the land abuts a public airport; and
27.1    (ii) the owner of the aircraft storage hangar provides the assessor with a signed
27.2agreement restricting the use of the premises, prohibiting commercial use or activity
27.3performed at the hangar; and
27.4    (9) residential real estate, a portion of which is used by the owner for homestead
27.5purposes, and that is also a place of lodging, if all of the following criteria are met:
27.6    (i) rooms are provided for rent to transient guests that generally stay for periods
27.7of 14 or fewer days;
27.8    (ii) meals are provided to persons who rent rooms, the cost of which is incorporated
27.9in the basic room rate;
27.10    (iii) meals are not provided to the general public except for special events on fewer
27.11than seven days in the calendar year preceding the year of the assessment; and
27.12    (iv) the owner is the operator of the property.
27.13The market value subject to the 4c classification under this clause is limited to five rental
27.14units. Any rental units on the property in excess of five, must be valued and assessed as
27.15class 3a. The portion of the property used for purposes of a homestead by the owner must
27.16be classified as class 1a property under subdivision 22;
27.17    (10) real property up to a maximum of three acres and operated as a restaurant
27.18as defined under section 157.15, subdivision 12, provided it: (A) is located on a lake
27.19as defined under section 103G.005, subdivision 15, paragraph (a), clause (3); and (B)
27.20is either devoted to commercial purposes for not more than 250 consecutive days, or
27.21receives at least 60 percent of its annual gross receipts from business conducted during
27.22four consecutive months. Gross receipts from the sale of alcoholic beverages must be
27.23included in determining the property's qualification under subitem (B). The property's
27.24primary business must be as a restaurant and not as a bar. Gross receipts from gift shop
27.25sales located on the premises must be excluded. Owners of real property desiring 4c
27.26classification under this clause must submit an annual declaration to the assessor by
27.27February 1 of the current assessment year, based on the property's relevant information for
27.28the preceding assessment year; and
27.29(11) lakeshore and riparian property and adjacent land, not to exceed six acres, used
27.30as a marina, as defined in section 86A.20, subdivision 5, which is made accessible to
27.31the public and devoted to recreational use for marina services. The marina owner must
27.32annually provide evidence to the assessor that it provides services, including lake or
27.33river access to the public. No more than 800 feet of lakeshore may be included in this
27.34classification. Buildings used in conjunction with a marina for marina services, including
27.35but not limited to buildings used to provide food and beverage services, fuel, boat repairs,
27.36or the sale of bait or fishing tackle, are classified as class 3a property.
28.1    Class 4c property has a class rate of 1.5 percent of market value, except that (i) each
28.2parcel of seasonal residential recreational property not used for commercial purposes has
28.3the same class rates as class 4bb property, (ii) manufactured home parks assessed under
28.4clause (5), item (i), have the same class rate as class 4b property, and the market value
28.5of manufactured home parks assessed under clause (5), item (ii), has the same class rate
28.6as class 4d property, (iii) commercial-use seasonal residential recreational property and
28.7marina recreational land as described in clause (11), has a class rate of one percent for the
28.8first $500,000 of market value, and 1.25 percent for the remaining market value, (iv) the
28.9market value of property described in clause (4) has a class rate of one percent, (v) the
28.10market value of property described in clauses (2), (6), and (10) has a class rate of 1.25
28.11percent, and (vi) that portion of the market value of property in clause (9) qualifying for
28.12class 4c property has a class rate of 1.25 percent.
28.13    (e) Class 4d property is qualifying low-income rental housing certified to the assessor
28.14by the Housing Finance Agency under section 273.128, subdivision 3. If only a portion
28.15of the units in the building qualify as low-income rental housing units as certified under
28.16section 273.128, subdivision 3, only the proportion of qualifying units to the total number
28.17of units in the building qualify for class 4d. The remaining portion of the building shall be
28.18classified by the assessor based upon its use. Class 4d also includes the same proportion of
28.19land as the qualifying low-income rental housing units are to the total units in the building.
28.20For all properties qualifying as class 4d, the market value determined by the assessor must
28.21be based on the normal approach to value using normal unrestricted rents.
28.22    Class 4d property has a class rate of 0.75 percent.
28.23EFFECTIVE DATE.This section is effective for assessment year 2010, for taxes
28.24payable in 2011 and thereafter.

28.25    Sec. 17. Minnesota Statutes 2008, section 273.13, subdivision 34, is amended to read:
28.26    Subd. 34. Homestead of disabled veteran. (a) All or a portion of the market value
28.27of property owned by a veteran or by the veteran and the veteran's spouse qualifying
28.28for homestead classification under subdivision 22 or 23 is excluded in determining the
28.29property's taxable market value if it serves as the homestead of a military veteran, as
28.30defined in section 197.447, who has a service-connected disability of 70 percent or
28.31more. To qualify for the exclusion under this subdivision paragraphs (a) and (b), the
28.32veteran must have been honorably discharged from the United States armed forces, as
28.33indicated by United States Government Form DD214 or other official military discharge
28.34papers, and must be certified by the United States Veterans Administration as having a
28.35service-connected disability.
29.1    (b)(1) For a disability rating of 70 percent or more, $150,000 of market value is
29.2excluded, except as provided in clause (2); and
29.3    (2) for a total (100 percent) and permanent disability, $300,000 of market value is
29.4excluded.
29.5    (c) If a disabled veteran qualifying for a valuation exclusion under paragraph (b),
29.6clause (2), predeceases the veteran's spouse, and if upon the death of the veteran the
29.7spouse holds the legal or beneficial title to the homestead and permanently resides there,
29.8the exclusion shall carry over to the benefit of the veteran's spouse for one four additional
29.9assessment year years or until such time as the spouse sells, transfers, or otherwise
29.10disposes of the property, whichever comes first.
29.11(d) If the spouse of a military service person who dies due to a service-connected
29.12cause while in active service, as defined in section 190.05, subdivision 5, holds the legal
29.13or beneficial title to a homestead and permanently resides there at the time of the service
29.14person's death, the spouse shall be eligible for a market value exclusion of $300,000 for
29.15five years following the death of the service person, or until such time as the spouse
29.16sells, transfers, or otherwise disposes of the property, whichever comes first. To qualify
29.17for exclusion under this paragraph, the surviving spouse must apply to the assessor and
29.18show proof of the service member's death while in active service in any branch or unit of
29.19the United States armed forces, as indicated on United States Government Form DD1300
29.20or DD2064. If the application is received prior to July 1 of a given year, the exclusion
29.21first applies for taxes payable in the following year. If the application is received after
29.22June 30 of a given year, the exclusion first applies for taxes payable in the second year
29.23following receipt of the application.
29.24    (d) (e) In the case of an agricultural homestead, only the portion of the property
29.25consisting of the house and garage and immediately surrounding one acre of land qualifies
29.26for the valuation exclusion under this subdivision.
29.27    (e) (f) A property qualifying for a valuation exclusion under this subdivision is
29.28not eligible for the credit under section 273.1384, subdivision 1, or classification under
29.29subdivision 22, paragraph (b).
29.30    (f) (g) To qualify for a valuation exclusion under this subdivision a property owner
29.31must apply to the assessor by July 1 of each assessment year, except that an annual
29.32reapplication is not required once a property has been accepted for a valuation exclusion
29.33under paragraph (b), clause (2), or paragraph (d), and the property continues to qualify
29.34until there is a change in ownership.
29.35EFFECTIVE DATE.The change made to paragraph (c) is effective for taxes
29.36payable in 2011 and thereafter, and applies to the surviving spouse of any disabled veteran
30.1who had previously been assessed under paragraph (c). Paragraph (d) is effective for
30.2deaths occurring the day following final enactment and thereafter.

30.3    Sec. 18. Minnesota Statutes 2009 Supplement, section 275.065, subdivision 3, is
30.4amended to read:
30.5    Subd. 3. Notice of proposed property taxes. (a) The county auditor shall prepare
30.6and the county treasurer shall deliver after November 10 and on or before November 24
30.7each year, by first class mail to each taxpayer at the address listed on the county's current
30.8year's assessment roll, a notice of proposed property taxes. Upon written request by
30.9the taxpayer, the treasurer may send the notice in electronic form or by electronic mail
30.10instead of on paper or by ordinary mail.
30.11    (b) The commissioner of revenue shall prescribe the form of the notice.
30.12    (c) The notice must inform taxpayers that it contains the amount of property taxes
30.13each taxing authority proposes to collect for taxes payable the following year. In the case
30.14of a town, or in the case of the state general tax, the final tax amount will be its proposed
30.15tax. The notice must clearly state for each city, county, school district, regional library
30.16authority established under section 134.201, and metropolitan taxing districts as defined in
30.17paragraph (i), the time and place of the taxing authorities' regularly scheduled meetings in
30.18which the budget and levy will be discussed and the final budget and levy determined,
30.19which must occur after November 24. The taxing authorities must provide the county
30.20auditor with the information to be included in the notice on or before the time it certifies its
30.21proposed levy under subdivision 1. The public must be allowed to speak at the meetings
30.22and the meetings shall not be held before 6:00 p.m. It must provide a telephone number
30.23for the taxing authority that taxpayers may call if they have questions related to the notice
30.24and an address where comments will be received by mail, except that no notice required
30.25under this section shall be interpreted as requiring the printing of a personal telephone
30.26number or address as the contact information for a taxing authority. If a taxing authority
30.27does not maintain public offices where telephone calls can be received by the authority, the
30.28authority may inform the county of the lack of a public telephone number and the county
30.29shall not list a telephone number for that taxing authority.
30.30    (d) The notice must state for each parcel:
30.31    (1) the market value of the property as determined under section 273.11, and used
30.32for computing property taxes payable in the following year and for taxes payable in the
30.33current year as each appears in the records of the county assessor on November 1 of the
30.34current year; and, in the case of residential property, whether the property is classified as
31.1homestead or nonhomestead. The notice must clearly inform taxpayers of the years to
31.2which the market values apply and that the values are final values;
31.3    (2) the items listed below, shown separately by county, city or town, and state general
31.4tax, net of the residential and agricultural homestead credit under section 273.1384, voter
31.5approved school levy, other local school levy, and the sum of the special taxing districts,
31.6and as a total of all taxing authorities:
31.7    (i) the actual tax for taxes payable in the current year; and
31.8    (ii) the proposed tax amount.
31.9    If the county levy under clause (2) includes an amount for a lake improvement
31.10district as defined under sections 103B.501 to 103B.581, the amount attributable for that
31.11purpose must be separately stated from the remaining county levy amount.
31.12    In the case of a town or the state general tax, the final tax shall also be its proposed
31.13tax unless the town changes its levy at a special town meeting under section 365.52. If a
31.14school district has certified under section 126C.17, subdivision 9, that a referendum will
31.15be held in the school district at the November general election, the county auditor must
31.16note next to the school district's proposed amount that a referendum is pending and that, if
31.17approved by the voters, the tax amount may be higher than shown on the notice. In the
31.18case of the city of Minneapolis, the levy for Minneapolis Park and Recreation shall be
31.19listed separately from the remaining amount of the city's levy. In the case of the city of
31.20St. Paul, the levy for the St. Paul Library Agency must be listed separately from the
31.21remaining amount of the city's levy. In the case of Ramsey County, any amount levied
31.22under section 134.07 may be listed separately from the remaining amount of the county's
31.23levy. In the case of a parcel where tax increment or the fiscal disparities areawide tax
31.24under chapter 276A or 473F applies, the proposed tax levy on the captured value or the
31.25proposed tax levy on the tax capacity subject to the areawide tax must each be stated
31.26separately and not included in the sum of the special taxing districts; and
31.27    (3) the increase or decrease between the total taxes payable in the current year and
31.28the total proposed taxes, expressed as a percentage.
31.29    For purposes of this section, the amount of the tax on homesteads qualifying under
31.30the senior citizens' property tax deferral program under chapter 290B is the total amount
31.31of property tax before subtraction of the deferred property tax amount.
31.32    (e) The notice must clearly state that the proposed or final taxes do not include
31.33the following:
31.34    (1) special assessments;
31.35    (2) levies approved by the voters after the date the proposed taxes are certified,
31.36including bond referenda and school district levy referenda;
32.1    (3) a levy limit increase approved by the voters by the first Tuesday after the first
32.2Monday in November of the levy year as provided under section 275.73;
32.3    (4) amounts necessary to pay cleanup or other costs due to a natural disaster
32.4occurring after the date the proposed taxes are certified;
32.5    (5) amounts necessary to pay tort judgments against the taxing authority that become
32.6final after the date the proposed taxes are certified; and
32.7    (6) the contamination tax imposed on properties which received market value
32.8reductions for contamination.
32.9    (f) Except as provided in subdivision 7, failure of the county auditor to prepare or
32.10the county treasurer to deliver the notice as required in this section does not invalidate the
32.11proposed or final tax levy or the taxes payable pursuant to the tax levy.
32.12    (g) If the notice the taxpayer receives under this section lists the property as
32.13nonhomestead, and satisfactory documentation is provided to the county assessor by the
32.14applicable deadline, and the property qualifies for the homestead classification in that
32.15assessment year, the assessor shall reclassify the property to homestead for taxes payable
32.16in the following year.
32.17    (h) In the case of class 4 residential property used as a residence for lease or rental
32.18periods of 30 days or more, the taxpayer must either:
32.19    (1) mail or deliver a copy of the notice of proposed property taxes to each tenant,
32.20renter, or lessee; or
32.21    (2) post a copy of the notice in a conspicuous place on the premises of the property.
32.22    The notice must be mailed or posted by the taxpayer by November 27 or within
32.23three days of receipt of the notice, whichever is later. A taxpayer may notify the county
32.24treasurer of the address of the taxpayer, agent, caretaker, or manager of the premises to
32.25which the notice must be mailed in order to fulfill the requirements of this paragraph.
32.26    (i) For purposes of this subdivision and subdivision 6, "metropolitan special taxing
32.27districts" means the following taxing districts in the seven-county metropolitan area that
32.28levy a property tax for any of the specified purposes listed below:
32.29    (1) Metropolitan Council under section 473.132, 473.167, 473.249, 473.325,
32.30473.446 , 473.521, 473.547, or 473.834;
32.31    (2) Metropolitan Airports Commission under section 473.667, 473.671, or 473.672;
32.32and
32.33    (3) Metropolitan Mosquito Control Commission under section 473.711.
32.34    For purposes of this section, any levies made by the regional rail authorities in the
32.35county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter
32.36398A shall be included with the appropriate county's levy.
33.1    (j) The governing body of a county, city, or school district may, with the consent
33.2of the county board, include supplemental information with the statement of proposed
33.3property taxes about the impact of state aid increases or decreases on property tax
33.4increases or decreases and on the level of services provided in the affected jurisdiction.
33.5This supplemental information may include information for the following year, the current
33.6year, and for as many consecutive preceding years as deemed appropriate by the governing
33.7body of the county, city, or school district. It may include only information regarding:
33.8    (1) the impact of inflation as measured by the implicit price deflator for state and
33.9local government purchases;
33.10    (2) population growth and decline;
33.11    (3) state or federal government action; and
33.12    (4) other financial factors that affect the level of property taxation and local services
33.13that the governing body of the county, city, or school district may deem appropriate to
33.14include.
33.15    The information may be presented using tables, written narrative, and graphic
33.16representations and may contain instruction toward further sources of information or
33.17opportunity for comment.
33.18EFFECTIVE DATE.This section is effective for notices prepared in 2010, for
33.19taxes payable in 2011 and thereafter.

33.20    Sec. 19. Minnesota Statutes 2009 Supplement, section 275.70, subdivision 5, as
33.21amended by Laws 2010, chapter 215, article 13, section 3, is amended to read:
33.22    Subd. 5. Special levies. "Special levies" means those portions of ad valorem taxes
33.23levied by a local governmental unit for the following purposes or in the following manner:
33.24    (1) to pay the costs of the principal and interest on bonded indebtedness or to
33.25reimburse for the amount of liquor store revenues used to pay the principal and interest
33.26due on municipal liquor store bonds in the year preceding the year for which the levy
33.27limit is calculated;
33.28    (2) to pay the costs of principal and interest on certificates of indebtedness issued for
33.29any corporate purpose except for the following:
33.30    (i) tax anticipation or aid anticipation certificates of indebtedness;
33.31    (ii) certificates of indebtedness issued under sections 298.28 and 298.282;
33.32    (iii) certificates of indebtedness used to fund current expenses or to pay the costs of
33.33extraordinary expenditures that result from a public emergency; or
33.34    (iv) certificates of indebtedness used to fund an insufficiency in tax receipts or
33.35an insufficiency in other revenue sources;
34.1    (3) to provide for the bonded indebtedness portion of payments made to another
34.2political subdivision of the state of Minnesota;
34.3    (4) to fund payments made to the Minnesota State Armory Building Commission
34.4under section 193.145, subdivision 2, to retire the principal and interest on armory
34.5construction bonds;
34.6    (5) property taxes approved by voters which are levied against the referendum
34.7market value as provided under section 275.61;
34.8    (6) to fund matching requirements needed to qualify for federal or state grants or
34.9programs to the extent that either (i) the matching requirement exceeds the matching
34.10requirement in calendar year 2001, or (ii) it is a new matching requirement that did not
34.11exist prior to 2002;
34.12    (7) to pay the expenses reasonably and necessarily incurred in preparing for or
34.13repairing the effects of natural disaster including the occurrence or threat of widespread
34.14or severe damage, injury, or loss of life or property resulting from natural causes, in
34.15accordance with standards formulated by the Emergency Services Division of the state
34.16Department of Public Safety, as allowed by the commissioner of revenue under section
34.17275.74, subdivision 2 ;
34.18    (8) pay amounts required to correct an error in the levy certified to the county
34.19auditor by a city or county in a levy year, but only to the extent that when added to the
34.20preceding year's levy it is not in excess of an applicable statutory, special law or charter
34.21limitation, or the limitation imposed on the governmental subdivision by sections 275.70
34.22to 275.74 in the preceding levy year;
34.23    (9) to pay an abatement under section 469.1815;
34.24    (10) to pay any costs attributable to increases in the employer contribution rates
34.25under chapter 353, or locally administered pension plans, that are effective after June
34.2630, 2001;
34.27    (11) to pay the operating or maintenance costs of a county jail as authorized in
34.28section 641.01 or 641.262, or of a correctional facility as defined in section 241.021,
34.29subdivision 1 , paragraph (f), to the extent that the county can demonstrate to the
34.30commissioner of revenue that the amount has been included in the county budget as
34.31a direct result of a rule, minimum requirement, minimum standard, or directive of the
34.32Department of Corrections, or to pay the operating or maintenance costs of a regional jail
34.33as authorized in section 641.262. For purposes of this clause, a district court order is
34.34not a rule, minimum requirement, minimum standard, or directive of the Department of
34.35Corrections. If the county utilizes this special levy, except to pay operating or maintenance
34.36costs of a new regional jail facility under sections 641.262 to 641.264 which will not
35.1replace an existing jail facility, any amount levied by the county in the previous levy year
35.2for the purposes specified under this clause and included in the county's previous year's
35.3levy limitation computed under section 275.71, shall be deducted from the levy limit
35.4base under section 275.71, subdivision 2, when determining the county's current year
35.5levy limitation. The county shall provide the necessary information to the commissioner
35.6of revenue for making this determination;
35.7    (12) to pay for operation of a lake improvement district, as authorized under section
35.8103B.555 . If the county utilizes this special levy, any amount levied by the county in the
35.9previous levy year for the purposes specified under this clause and included in the county's
35.10previous year's levy limitation computed under section 275.71 shall be deducted from
35.11the levy limit base under section 275.71, subdivision 2, when determining the county's
35.12current year levy limitation. The county shall provide the necessary information to the
35.13commissioner of revenue for making this determination;
35.14    (13) to repay a state or federal loan used to fund the direct or indirect required
35.15spending by the local government due to a state or federal transportation project or other
35.16state or federal capital project. This authority may only be used if the project is not a
35.17local government initiative;
35.18    (14) to pay for court administration costs as required under section 273.1398,
35.19subdivision 4b , less the (i) county's share of transferred fines and fees collected by the
35.20district courts in the county for calendar year 2001 and (ii) the aid amount certified to be
35.21paid to the county in 2004 under section 273.1398, subdivision 4c; however, for taxes
35.22levied to pay for these costs in the year in which the court financing is transferred to the
35.23state, the amount under this clause is limited to the amount of aid the county is certified to
35.24receive under section 273.1398, subdivision 4a;
35.25    (15) to fund a police or firefighters relief association as required under section 69.77
35.26to the extent that the required amount exceeds the amount levied for this purpose in 2001;
35.27    (16) for purposes of a storm sewer improvement district under section 444.20;
35.28    (17) to pay for the maintenance and support of a city or county society for the
35.29prevention of cruelty to animals under section 343.11, but not to exceed in any year
35.30$4,800 or the sum of $1 per capita based on the county's or city's population as of the most
35.31recent federal census, whichever is greater. If the city or county uses this special levy, any
35.32amount levied by the city or county in the previous levy year for the purposes specified
35.33in this clause and included in the city's or county's previous year's levy limit computed
35.34under section 275.71, must be deducted from the levy limit base under section 275.71,
35.35subdivision 2 , in determining the city's or county's current year levy limit;
36.1    (18) for counties, to pay for the increase in their share of health and human service
36.2costs caused by reductions in federal health and human services grants effective after
36.3September 30, 2007;
36.4    (19) for a city, for the costs reasonably and necessarily incurred for securing,
36.5maintaining, or demolishing foreclosed or abandoned residential properties, as allowed by
36.6the commissioner of revenue under section 275.74, subdivision 2. A city must have either
36.7(i) a foreclosure rate of at least 1.4 percent in 2007, or (ii) a foreclosure rate in 2007 in
36.8the city or in a zip code area of the city that is at least 50 percent higher than the average
36.9foreclosure rate in the metropolitan area, as defined in section 473.121, subdivision 2,
36.10to use this special levy. For purposes of this paragraph, "foreclosure rate" means the
36.11number of foreclosures, as indicated by sheriff sales records, divided by the number of
36.12households in the city in 2007;
36.13    (20) for a city, for the unreimbursed costs of redeployed traffic-control agents and
36.14lost traffic citation revenue due to the collapse of the Interstate 35W bridge, as certified
36.15to the Federal Highway Administration;
36.16    (21) to pay costs attributable to wages and benefits for sheriff, police, and fire
36.17personnel. If a local governmental unit did not use this special levy in the previous year its
36.18levy limit base under section 275.71 shall be reduced by the amount equal to the amount it
36.19levied for the purposes specified in this clause in the previous year;
36.20    (22) an amount equal to any reductions in the certified aids or credits payable
36.21under sections 477A.011 to 477A.014, and section 273.1384, due to unallotment under
36.22section 16A.152 or reductions under another provision of law. The amount of the levy
36.23allowed under this clause is equal to the amount unallotted or reduced in the calendar year
36.24in which the tax is levied unless the unallotment or reduction amount is not known by
36.25September 1 of the levy year, and the local government has not adjusted its levy under
36.26section 275.065, subdivision 6, or 275.07, subdivision 6, in which case the unallotment
36.27or reduction amount may be levied in the following year;
36.28(23) to pay for the difference between one-half of the costs of confining sex offenders
36.29undergoing the civil commitment process and any state payments for this purpose pursuant
36.30to section 253B.185, subdivision 5;
36.31(24) for a county to pay the costs of the first year of maintaining and operating a new
36.32facility or new expansion, either of which contains courts, corrections, dispatch, criminal
36.33investigation labs, or other public safety facilities and for which all or a portion of the
36.34funding for the site acquisition, building design, site preparation, construction, and related
36.35equipment was issued or authorized prior to the imposition of levy limits in 2008. The
37.1levy limit base shall then be increased by an amount equal to the new facility's first full
37.2year's operating costs as described in this clause; and
37.3(25) for the estimated amount of reduction to market value credit reimbursements
37.4under section 273.1384 for credits payable in the year in which the levy is payable.; and
37.5(26) to pay the estimated costs of all salaries and expenses of county veteran service
37.6officers, as provided under section 197.60, subdivision 4.
37.7EFFECTIVE DATE.This section is effective for taxes payable in 2011 and
37.8thereafter.

37.9    Sec. 20. Minnesota Statutes 2008, section 275.71, subdivision 4, is amended to read:
37.10    Subd. 4. Adjusted levy limit base. For taxes levied in 2008 through 2010, the
37.11adjusted levy limit base is equal to the levy limit base computed under subdivision 2
37.12or section 275.72, multiplied by:
37.13    (1) one plus the lesser of 3.9 percent or the percentage growth in the implicit price
37.14deflator, but the percentage shall not be less than zero or exceed 3.9 percent;
37.15    (2) one plus a percentage equal to 50 percent of the percentage increase in the number
37.16of households, if any, for the most recent 12-month period for which data is available; and
37.17    (3) one plus a percentage equal to 50 percent of the percentage increase in the
37.18taxable market value of the jurisdiction due to new construction of class 3 property, as
37.19defined in section 273.13, subdivision 4, except for state-assessed utility and railroad
37.20property, for the most recent year for which data is available.
37.21EFFECTIVE DATE.This section is effective for taxes levied in 2010 and thereafter.

37.22    Sec. 21. Minnesota Statutes 2008, section 276.02, is amended to read:
37.23276.02 TREASURER TO BE COLLECTOR.
37.24The county treasurer shall collect all taxes extended on the tax lists of the county
37.25and the fines, forfeitures, or penalties received by any person or officer for the use of
37.26the county. The treasurer shall collect the taxes according to law and credit them to the
37.27proper funds. This section does not apply to fines and penalties accruing to municipal
37.28corporations for the violation of their ordinances that are recoverable before a city justice.
37.29Taxes, fines, interest, and penalties must be paid with United States currency or by check
37.30or, money order, or electronic payments, including, but not limited to, automated clearing
37.31house transactions and federal wires drawn on a bank or other financial institution in the
37.32United States. The county board may by resolution authorize the treasurer to impose a
37.33charge for any dishonored checks or electronic payments. The charges for dishonored
38.1payment of property taxes may be added to the tax, shall constitute a lien on the property,
38.2and when collected shall be distributed to the county.
38.3The county board may, by resolution, authorize the treasurer and/or other designees
38.4to accept payments of real property taxes by credit card provided that a fee is charged for
38.5its use. The fee charged must be commensurate with the costs assessed by the card issuer.
38.6If a credit card transaction under this section is subsequently voided or otherwise reversed,
38.7the lien of real property taxes under section 272.31 is revived and attaches in the manner
38.8and time provided in that section as though the credit card transaction had never occurred,
38.9and the voided or reversed credit card transaction shall not impair the right of a lienholder
38.10under section 272.31 to enforce the lien in its favor.
38.11EFFECTIVE DATE.This section is effective for property taxes payable in 2011
38.12and thereafter.

38.13    Sec. 22. Minnesota Statutes 2009 Supplement, section 276.04, subdivision 2, is
38.14amended to read:
38.15    Subd. 2. Contents of tax statements. (a) The treasurer shall provide for the
38.16printing of the tax statements. The commissioner of revenue shall prescribe the form of
38.17the property tax statement and its contents. The tax statement must not state or imply that
38.18property tax credits are paid by the state of Minnesota. The statement must contain a
38.19tabulated statement of the dollar amount due to each taxing authority and the amount of the
38.20state tax from the parcel of real property for which a particular tax statement is prepared.
38.21The dollar amounts attributable to the county, the state tax, the voter approved school tax,
38.22the other local school tax, the township or municipality, and the total of the metropolitan
38.23each special taxing districts district as defined in section 275.065, subdivision 3, paragraph
38.24(i) 275.066, must be separately stated. The amounts due all other special taxing districts, if
38.25any, may be aggregated except that any levies made by the regional rail authorities in the
38.26county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter
38.27398A shall be listed on a separate line directly under the appropriate county's levy. If the
38.28county levy under this paragraph includes an amount for a lake improvement district as
38.29defined under sections 103B.501 to 103B.581, the amount attributable for that purpose
38.30must be separately stated from the remaining county levy amount. In the case of Ramsey
38.31County, if the county levy under this paragraph includes an amount for public library
38.32service under section 134.07, the amount attributable for that purpose may be separated
38.33from the remaining county levy amount. The amount of the tax on homesteads qualifying
38.34under the senior citizens' property tax deferral program under chapter 290B is the total
38.35amount of property tax before subtraction of the deferred property tax amount. The
39.1amount of the tax on contamination value imposed under sections 270.91 to 270.98, if any,
39.2must also be separately stated. The dollar amounts, including the dollar amount of any
39.3special assessments, may be rounded to the nearest even whole dollar. For purposes of this
39.4section whole odd-numbered dollars may be adjusted to the next higher even-numbered
39.5dollar. The amount of market value excluded under section 273.11, subdivision 16, if any,
39.6must also be listed on the tax statement.
39.7    (b) The property tax statements for manufactured homes and sectional structures
39.8taxed as personal property shall contain the same information that is required on the
39.9tax statements for real property.
39.10    (c) Real and personal property tax statements must contain the following information
39.11in the order given in this paragraph. The information must contain the current year tax
39.12information in the right column with the corresponding information for the previous year
39.13in a column on the left:
39.14    (1) the property's estimated market value under section 273.11, subdivision 1;
39.15    (2) the property's taxable market value after reductions under section 273.11,
39.16subdivisions 1a and 16 ;
39.17    (3) the property's gross tax, before credits;
39.18    (4) for homestead residential and agricultural properties, the credits under section
39.19273.1384 ;
39.20    (5) any credits received under sections 273.119; 273.1234 or 273.1235; 273.135;
39.21273.1391 ; 273.1398, subdivision 4; 469.171; and 473H.10, except that the amount of
39.22credit received under section 273.135 must be separately stated and identified as "taconite
39.23tax relief"; and
39.24    (6) the net tax payable in the manner required in paragraph (a).
39.25    (d) If the county uses envelopes for mailing property tax statements and if the county
39.26agrees, a taxing district may include a notice with the property tax statement notifying
39.27taxpayers when the taxing district will begin its budget deliberations for the current
39.28year, and encouraging taxpayers to attend the hearings. If the county allows notices to
39.29be included in the envelope containing the property tax statement, and if more than
39.30one taxing district relative to a given property decides to include a notice with the tax
39.31statement, the county treasurer or auditor must coordinate the process and may combine
39.32the information on a single announcement.
39.33EFFECTIVE DATE.This section is effective for tax statements relating to taxes
39.34payable in 2012 and thereafter.

40.1    Sec. 23. Minnesota Statutes 2009 Supplement, section 279.01, subdivision 1, is
40.2amended to read:
40.3    Subdivision 1. Due dates; penalties. Except as provided in subdivision 3 or 4, on
40.4May 16 or 21 days after the postmark date on the envelope containing the property tax
40.5statement, whichever is later, a penalty accrues and thereafter is charged upon all unpaid
40.6taxes on real estate on the current lists in the hands of the county treasurer. The penalty is
40.7at a rate of two percent on homestead property until May 31 and four percent on June 1.
40.8The penalty on nonhomestead property is at a rate of four percent until May 31 and eight
40.9percent on June 1. This penalty does not accrue until June 1 of each year, or 21 days after
40.10the postmark date on the envelope containing the property tax statements, whichever is
40.11later, on commercial use real property used for seasonal residential recreational purposes
40.12and classified as class 1c or 4c, and on other commercial use real property classified as
40.13class 3a, provided that over 60 percent of the gross income earned by the enterprise on the
40.14class 3a property is earned during the months of May, June, July, and August. In order for
40.15the first half of the tax due on class 3a property to be paid after May 15 and before June 1,
40.16or 21 days after the postmark date on the envelope containing the property tax statement,
40.17whichever is later, without penalty, the owner of the property must attach an affidavit to the
40.18payment attesting to compliance with the income provision of this subdivision. Thereafter,
40.19for both homestead and nonhomestead property, on the first day of each month beginning
40.20July 1, up to and including October 1 following, an additional penalty of one percent for
40.21each month accrues and is charged on all such unpaid taxes provided that if the due date
40.22was extended beyond May 15 as the result of any delay in mailing property tax statements
40.23no additional penalty shall accrue if the tax is paid by the extended due date. If the tax is
40.24not paid by the extended due date, then all penalties that would have accrued if the due
40.25date had been May 15 shall be charged. When the taxes against any tract or lot exceed
40.26$250 $100, one-half thereof may be paid prior to May 16 or 21 days after the postmark
40.27date on the envelope containing the property tax statement, whichever is later; and, if so
40.28paid, no penalty attaches; the remaining one-half may be paid at any time prior to October
40.2916 following, without penalty; but, if not so paid, then a penalty of two percent accrues
40.30thereon for homestead property and a penalty of four percent on nonhomestead property.
40.31Thereafter, for homestead property, on the first day of November an additional penalty of
40.32four percent accrues and on the first day of December following, an additional penalty of
40.33two percent accrues and is charged on all such unpaid taxes. Thereafter, for nonhomestead
40.34property, on the first day of November and December following, an additional penalty of
40.35four percent for each month accrues and is charged on all such unpaid taxes. If one-half of
40.36such taxes are not paid prior to May 16 or 21 days after the postmark date on the envelope
41.1containing the property tax statement, whichever is later, the same may be paid at any time
41.2prior to October 16, with accrued penalties to the date of payment added, and thereupon
41.3no penalty attaches to the remaining one-half until October 16 following.
41.4    This section applies to payment of personal property taxes assessed against
41.5improvements to leased property, except as provided by section 277.01, subdivision 3.
41.6    A county may provide by resolution that in the case of a property owner that has
41.7multiple tracts or parcels with aggregate taxes exceeding $250 $100, payments may be
41.8made in installments as provided in this subdivision.
41.9    The county treasurer may accept payments of more or less than the exact amount of
41.10a tax installment due. Payments must be applied first to the oldest installment that is due
41.11but which has not been fully paid. If the accepted payment is less than the amount due,
41.12payments must be applied first to the penalty accrued for the year or the installment being
41.13paid. Acceptance of partial payment of tax does not constitute a waiver of the minimum
41.14payment required as a condition for filing an appeal under section 278.03 or any other law,
41.15nor does it affect the order of payment of delinquent taxes under section 280.39.
41.16EFFECTIVE DATE.This section is effective for taxes payable in 2011 and
41.17thereafter.

41.18    Sec. 24. Minnesota Statutes 2008, section 279.025, is amended to read:
41.19279.025 PAYMENT OF DELINQUENT PROPERTY TAXES, SPECIAL
41.20ASSESSMENTS.
41.21Payment of delinquent property tax and related interest and penalties and special
41.22assessments shall be paid with United States currency or by check or, money order, or
41.23electronic means, including, but not limited to, automated clearing house transactions and
41.24federal wires drawn on a bank or other financial institution in the United States.
41.25EFFECTIVE DATE.This section is effective for property taxes payable in 2011
41.26and thereafter.

41.27    Sec. 25. Minnesota Statutes 2009 Supplement, section 290B.03, subdivision 1, is
41.28amended to read:
41.29    Subdivision 1. Program qualifications. The qualifications for the senior citizens'
41.30property tax deferral program are as follows:
41.31(1) the property must be owned and occupied as a homestead by a person 65 years of
41.32age or older. In the case of a married couple, at least one of the spouses must be at least 65
41.33years old at the time the first property tax deferral is granted, regardless of whether the
42.1property is titled in the name of one spouse or both spouses, or titled in another way that
42.2permits the property to have homestead status, and the other spouse must be at least 62
42.3years of age;
42.4(2) the total household income of the qualifying homeowners, as defined in section
42.5290A.03, subdivision 5 , for the calendar year preceding the year of the initial application
42.6may not exceed $60,000 $75,000;
42.7(3) the homestead must have been owned and occupied as the homestead of at
42.8least one of the qualifying homeowners for at least 15 years prior to the year the initial
42.9application is filed;
42.10(4) there are no state or federal tax liens or judgment liens on the homesteaded
42.11property;
42.12(5) there are no mortgages or other liens on the property that secure future advances,
42.13except for those subject to credit limits that result in compliance with clause (6); and
42.14(6) the total unpaid balances of debts secured by mortgages and other liens on the
42.15property, including unpaid and delinquent special assessments and interest and any
42.16delinquent property taxes, penalties, and interest, but not including property taxes payable
42.17during the year, does not exceed 75 percent of the assessor's estimated market value for
42.18the year.
42.19EFFECTIVE DATE.This section is effective July 1, 2010, and thereafter.

42.20    Sec. 26. Minnesota Statutes 2008, section 290B.03, is amended by adding a
42.21subdivision to read:
42.22    Subd. 1a. Special program qualifications; spouse of service member who
42.23died while in active service or deceased disabled veteran. (a) Notwithstanding the
42.24requirements of subdivision 1, clauses (1) and (3), but subject to all the other requirements
42.25of subdivision 1, homestead property owned and occupied by the spouse of either a service
42.26member who died while in active service, or a deceased disabled veteran, is eligible to
42.27participate in the program established under this chapter. For purposes of this subdivision,
42.28"service member who died while in active service" means a person serving in any branch
42.29or unit of the United States armed forces who has died from a service-connected cause
42.30while serving in active service, as defined in section 190.05, subdivision 5, as indicated on
42.31United States Government Form DD1300 or DD2064. For purposes of this subdivision,
42.32"deceased disabled veteran" means a deceased disabled veteran who was honorably
42.33discharged from the United States armed forces, as indicated by United States Government
42.34Form DD214 or other official military discharge papers, and certified by the United States
43.1Veterans Administration as having a total (100 percent) and permanent service-connected
43.2disability prior to the veteran's death.
43.3(b) Applications under this subdivision are exempt from the age requirements under
43.4the application process in section 290B.04, subdivision 1. The commissioner may require
43.5certifications as are necessary to ensure eligibility under this subdivision.
43.6EFFECTIVE DATE.This section is effective for taxes payable in 2011 and
43.7thereafter.

43.8    Sec. 27. Minnesota Statutes 2008, section 290B.04, subdivision 3, is amended to read:
43.9    Subd. 3. Excess-income certification by taxpayer. A taxpayer whose initial
43.10application has been approved under subdivision 2 shall notify the commissioner of
43.11revenue in writing by July 1 if the taxpayer's household income for the preceding calendar
43.12year exceeded $60,000 $75,000. The certification must state the homeowner's total
43.13household income for the previous calendar year. No property taxes may be deferred
43.14under this chapter in any year following the year in which a program participant filed
43.15or should have filed an excess-income certification under this subdivision, unless the
43.16participant has filed a resumption of eligibility certification as described in subdivision 4.
43.17EFFECTIVE DATE.This section is effective July 1, 2010, and thereafter.

43.18    Sec. 28. Minnesota Statutes 2008, section 290B.04, subdivision 4, is amended to read:
43.19    Subd. 4. Resumption of eligibility certification by taxpayer. A taxpayer who has
43.20previously filed an excess-income certification under subdivision 3 may resume program
43.21participation if the taxpayer's household income for a subsequent year is $60,000 $75,000
43.22or less. If the taxpayer chooses to resume program participation, the taxpayer must notify
43.23the commissioner of revenue in writing by July 1 of the year following a calendar year in
43.24which the taxpayer's household income is $60,000 $75,000 or less. The certification must
43.25state the taxpayer's total household income for the previous calendar year. Once a taxpayer
43.26resumes participation in the program under this subdivision, participation will continue
43.27until the taxpayer files a subsequent excess-income certification under subdivision 3 or
43.28until participation is terminated under section 290B.08, subdivision 1.
43.29EFFECTIVE DATE.This section is effective July 1, 2010, and thereafter.

43.30    Sec. 29. Minnesota Statutes 2008, section 290B.05, subdivision 1, is amended to read:
43.31    Subdivision 1. Determination by commissioner. The commissioner shall
43.32determine each qualifying homeowner's "annual maximum property tax amount"
44.1following approval of the homeowner's initial application and following the receipt of a
44.2resumption of eligibility certification. The "annual maximum property tax amount" equals
44.3three percent of the homeowner's total household income for the year preceding either the
44.4initial application or the resumption of eligibility certification, whichever is applicable.
44.5Following approval of the initial application, the commissioner shall determine the
44.6qualifying homeowner's "maximum allowable deferral." No tax may be deferred relative
44.7to the appropriate assessment year for any homeowner whose total household income
44.8for the previous year exceeds $60,000 $75,000. No tax shall be deferred in any year in
44.9which the homeowner does not meet the program qualifications in section 290B.03. The
44.10maximum allowable total deferral is equal to 75 percent of the assessor's estimated market
44.11value for the year, less the balance of any mortgage loans and other amounts secured by
44.12liens against the property at the time of application, including any unpaid and delinquent
44.13special assessments and interest and any delinquent property taxes, penalties, and interest,
44.14but not including property taxes payable during the year.
44.15EFFECTIVE DATE.This section is effective July 1, 2010, and thereafter.

44.16    Sec. 30. Minnesota Statutes 2008, section 428A.12, is amended to read:
44.17428A.12 PETITION REQUIRED.
44.18No action may be taken under sections 428A.13 and 428A.14 unless owners of
44.1925 50 percent or more of the housing units that would be subject to fees in the proposed
44.20housing improvement area file a petition requesting a public hearing on the proposed
44.21action with the city clerk. No action may be taken under section 428A.14 to impose a fee
44.22unless owners of 25 50 percent or more of the housing units subject to the proposed
44.23fee file a petition requesting a public hearing on the proposed fee with the city clerk or
44.24other appropriate official.
44.25EFFECTIVE DATE.This section is effective for petitions filed beginning July
44.261, 2010.

44.27    Sec. 31. Minnesota Statutes 2008, section 428A.18, subdivision 2, is amended to read:
44.28    Subd. 2. Requirements for veto. If residents of 35 45 percent or more of the
44.29housing units in the area subject to the fee file an objection to the ordinance adopted by the
44.30city under section 428A.13 with the city clerk before the effective date of the ordinance,
44.31the ordinance does not become effective. If owners of 35 45 percent or more of the housing
44.32units' tax capacity subject to the fee under section 428A.14 file an objection with the city
44.33clerk before the effective date of the resolution, the resolution does not become effective.
45.1EFFECTIVE DATE.This section is effective beginning July 1, 2010.

45.2    Sec. 32. Minnesota Statutes 2008, section 473H.05, subdivision 1, is amended to read:
45.3    Subdivision 1. Before March June 1 for next year's taxes. An owner or owners
45.4of certified long-term agricultural land may apply to the authority with jurisdiction over
45.5the land on forms provided by the commissioner of agriculture for the creation of an
45.6agricultural preserve at any time. Land for which application is received prior to March
45.7June 1 of any year shall be assessed pursuant to section 473H.10 for taxes payable in the
45.8following year. Land for which application is received on or after March June 1 of any
45.9year shall be assessed pursuant to section 473H.10 in the following year. The application
45.10shall be executed and acknowledged in the manner required by law to execute and
45.11acknowledge a deed and shall contain at least the following information and such other
45.12information as the commissioner deems necessary:
45.13(a) Legal description of the area proposed to be designated and parcel identification
45.14numbers if so designated by the county auditor and the certificate of title number if the
45.15land is registered;
45.16(b) Name and address of owner;
45.17(c) An affidavit by the authority evidencing that the land is certified long-term
45.18agricultural land at the date of application;
45.19(d) A statement by the owner covenanting that the land shall be kept in agricultural
45.20use, and shall be used in accordance with the provisions of sections 473H.02 to 473H.17
45.21which exist on the date of application and providing that the restrictive covenant shall be
45.22binding on the owner or the owner's successor or assignee, and shall run with the land.
45.23EFFECTIVE DATE.This section is effective the day following final enactment,
45.24except that in 2010 the application date in this section shall be extended to August 1.

45.25    Sec. 33. Minnesota Statutes 2009 Supplement, section 477A.011, subdivision 36, as
45.26amended by Laws 2010, chapter 215, article 13, section 4, is amended to read:
45.27    Subd. 36. City aid base. (a) Except as otherwise provided in this subdivision,
45.28"city aid base" is zero.
45.29    (b) The city aid base for any city with a population less than 500 is increased by
45.30$40,000 for aids payable in calendar year 1995 and thereafter, and the maximum amount
45.31of total aid it may receive under section 477A.013, subdivision 9, paragraph (c), is also
45.32increased by $40,000 for aids payable in calendar year 1995 only, provided that:
45.33    (i) the average total tax capacity rate for taxes payable in 1995 exceeds 200 percent;
45.34    (ii) the city portion of the tax capacity rate exceeds 100 percent; and
46.1    (iii) its city aid base is less than $60 per capita.
46.2    (c) The city aid base for a city is increased by $20,000 in 1998 and thereafter and
46.3the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
46.4paragraph (c), is also increased by $20,000 in calendar year 1998 only, provided that:
46.5    (i) the city has a population in 1994 of 2,500 or more;
46.6    (ii) the city is located in a county, outside of the metropolitan area, which contains a
46.7city of the first class;
46.8    (iii) the city's net tax capacity used in calculating its 1996 aid under section
46.9477A.013 is less than $400 per capita; and
46.10    (iv) at least four percent of the total net tax capacity, for taxes payable in 1996, of
46.11property located in the city is classified as railroad property.
46.12    (d) The city aid base for a city is increased by $200,000 in 1999 and thereafter and
46.13the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
46.14paragraph (c), is also increased by $200,000 in calendar year 1999 only, provided that:
46.15    (i) the city was incorporated as a statutory city after December 1, 1993;
46.16    (ii) its city aid base does not exceed $5,600; and
46.17    (iii) the city had a population in 1996 of 5,000 or more.
46.18    (e) The city aid base for a city is increased by $150,000 for aids payable in 2000 and
46.19thereafter, and the maximum amount of total aid it may receive under section 477A.013,
46.20subdivision 9 , paragraph (c), is also increased by $150,000 in calendar year 2000 only,
46.21provided that:
46.22    (1) the city has a population that is greater than 1,000 and less than 2,500;
46.23    (2) its commercial and industrial percentage for aids payable in 1999 is greater
46.24than 45 percent; and
46.25    (3) the total market value of all commercial and industrial property in the city
46.26for assessment year 1999 is at least 15 percent less than the total market value of all
46.27commercial and industrial property in the city for assessment year 1998.
46.28    (f) The city aid base for a city is increased by $200,000 in 2000 and thereafter, and
46.29the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
46.30paragraph (c), is also increased by $200,000 in calendar year 2000 only, provided that:
46.31    (1) the city had a population in 1997 of 2,500 or more;
46.32    (2) the net tax capacity of the city used in calculating its 1999 aid under section
46.33477A.013 is less than $650 per capita;
46.34    (3) the pre-1940 housing percentage of the city used in calculating 1999 aid under
46.35section 477A.013 is greater than 12 percent;
47.1    (4) the 1999 local government aid of the city under section 477A.013 is less than
47.220 percent of the amount that the formula aid of the city would have been if the need
47.3increase percentage was 100 percent; and
47.4    (5) the city aid base of the city used in calculating aid under section 477A.013
47.5is less than $7 per capita.
47.6    (g) The city aid base for a city is increased by $102,000 in 2000 and thereafter, and
47.7the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
47.8paragraph (c), is also increased by $102,000 in calendar year 2000 only, provided that:
47.9    (1) the city has a population in 1997 of 2,000 or more;
47.10    (2) the net tax capacity of the city used in calculating its 1999 aid under section
47.11477A.013 is less than $455 per capita;
47.12    (3) the net levy of the city used in calculating 1999 aid under section 477A.013 is
47.13greater than $195 per capita; and
47.14    (4) the 1999 local government aid of the city under section 477A.013 is less than
47.1538 percent of the amount that the formula aid of the city would have been if the need
47.16increase percentage was 100 percent.
47.17    (h) The city aid base for a city is increased by $32,000 in 2001 and thereafter, and
47.18the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
47.19paragraph (c), is also increased by $32,000 in calendar year 2001 only, provided that:
47.20    (1) the city has a population in 1998 that is greater than 200 but less than 500;
47.21    (2) the city's revenue need used in calculating aids payable in 2000 was greater
47.22than $200 per capita;
47.23    (3) the city net tax capacity for the city used in calculating aids available in 2000
47.24was equal to or less than $200 per capita;
47.25    (4) the city aid base of the city used in calculating aid under section 477A.013
47.26is less than $65 per capita; and
47.27    (5) the city's formula aid for aids payable in 2000 was greater than zero.
47.28    (i) The city aid base for a city is increased by $7,200 in 2001 and thereafter, and
47.29the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
47.30paragraph (c), is also increased by $7,200 in calendar year 2001 only, provided that:
47.31    (1) the city had a population in 1998 that is greater than 200 but less than 500;
47.32    (2) the city's commercial industrial percentage used in calculating aids payable in
47.332000 was less than ten percent;
47.34    (3) more than 25 percent of the city's population was 60 years old or older according
47.35to the 1990 census;
48.1    (4) the city aid base of the city used in calculating aid under section 477A.013
48.2is less than $15 per capita; and
48.3    (5) the city's formula aid for aids payable in 2000 was greater than zero.
48.4    (j) The city aid base for a city is increased by $45,000 in 2001 and thereafter and
48.5by an additional $50,000 in calendar years 2002 to 2011, and the maximum amount of
48.6total aid it may receive under section 477A.013, subdivision 9, paragraph (c), is also
48.7increased by $45,000 in calendar year 2001 only, and by $50,000 in calendar year 2002
48.8only, provided that:
48.9    (1) the net tax capacity of the city used in calculating its 2000 aid under section
48.10477A.013 is less than $810 per capita;
48.11    (2) the population of the city declined more than two percent between 1988 and 1998;
48.12    (3) the net levy of the city used in calculating 2000 aid under section 477A.013 is
48.13greater than $240 per capita; and
48.14    (4) the city received less than $36 per capita in aid under section 477A.013,
48.15subdivision 9 , for aids payable in 2000.
48.16    (k) The city aid base for a city with a population of 10,000 or more which is located
48.17outside of the seven-county metropolitan area is increased in 2002 and thereafter, and the
48.18maximum amount of total aid it may receive under section 477A.013, subdivision 9,
48.19paragraph (b) or (c), is also increased in calendar year 2002 only, by an amount equal to
48.20the lesser of:
48.21    (1)(i) the total population of the city, as determined by the United States Bureau of
48.22the Census, in the 2000 census, (ii) minus 5,000, (iii) times 60; or
48.23    (2) $2,500,000.
48.24    (l) The city aid base is increased by $50,000 in 2002 and thereafter, and the
48.25maximum amount of total aid it may receive under section 477A.013, subdivision 9,
48.26paragraph (c), is also increased by $50,000 in calendar year 2002 only, provided that:
48.27    (1) the city is located in the seven-county metropolitan area;
48.28    (2) its population in 2000 is between 10,000 and 20,000; and
48.29    (3) its commercial industrial percentage, as calculated for city aid payable in 2001,
48.30was greater than 25 percent.
48.31    (m) The city aid base for a city is increased by $150,000 in calendar years 2002 to
48.322011 and by an additional $75,000 in calendar years 2009 to 2014 and the maximum
48.33amount of total aid it may receive under section 477A.013, subdivision 9, paragraph (c), is
48.34also increased by $150,000 in calendar year 2002 only and by $75,000 in calendar year
48.352009 only, provided that:
48.36    (1) the city had a population of at least 3,000 but no more than 4,000 in 1999;
49.1    (2) its home county is located within the seven-county metropolitan area;
49.2    (3) its pre-1940 housing percentage is less than 15 percent; and
49.3    (4) its city net tax capacity per capita for taxes payable in 2000 is less than $900
49.4per capita.
49.5    (n) The city aid base for a city is increased by $200,000 beginning in calendar
49.6year 2003 and the maximum amount of total aid it may receive under section 477A.013,
49.7subdivision 9 , paragraph (c), is also increased by $200,000 in calendar year 2003 only,
49.8provided that the city qualified for an increase in homestead and agricultural credit aid
49.9under Laws 1995, chapter 264, article 8, section 18.
49.10    (o) The city aid base for a city is increased by $200,000 in 2004 only and the
49.11maximum amount of total aid it may receive under section 477A.013, subdivision 9, is
49.12also increased by $200,000 in calendar year 2004 only, if the city is the site of a nuclear
49.13dry cask storage facility.
49.14    (p) The city aid base for a city is increased by $10,000 in 2004 and thereafter and the
49.15maximum total aid it may receive under section 477A.013, subdivision 9, is also increased
49.16by $10,000 in calendar year 2004 only, if the city was included in a federal major disaster
49.17designation issued on April 1, 1998, and its pre-1940 housing stock was decreased by
49.18more than 40 percent between 1990 and 2000.
49.19    (q) The city aid base for a city is increased by $30,000 in 2009 and thereafter and the
49.20maximum total aid it may receive under section 477A.013, subdivision 9, is also increased
49.21by $25,000 in calendar year 2006 only if the city had a population in 2003 of at least 1,000
49.22and has a state park for which the city provides rescue services and which comprised at
49.23least 14 percent of the total geographic area included within the city boundaries in 2000.
49.24    (r) The city aid base for a city is increased by $80,000 in 2009 and thereafter and
49.25the minimum and maximum amount of total aid it may receive under section 477A.013,
49.26subdivision 9, is also increased by $80,000 in calendar year 2009 only, if:
49.27    (1) as of May 1, 2006, at least 25 percent of the tax capacity of the city is proposed
49.28to be placed in trust status as tax-exempt Indian land;
49.29    (2) the placement of the land is being challenged administratively or in court; and
49.30    (3) due to the challenge, the land proposed to be placed in trust is still on the tax
49.31rolls as of May 1, 2006.
49.32    (s) The city aid base for a city is increased by $100,000 in 2007 and thereafter and
49.33the minimum and maximum total amount of aid it may receive under this section is also
49.34increased in calendar year 2007 only, provided that:
49.35    (1) the city has a 2004 estimated population greater than 200 but less than 2,000;
49.36    (2) its city net tax capacity for aids payable in 2006 was less than $300 per capita;
50.1    (3) the ratio of its pay 2005 tax levy compared to its city net tax capacity for aids
50.2payable in 2006 was greater than 110 percent; and
50.3    (4) it is located in a county where at least 15,000 acres of land are classified as
50.4tax-exempt Indian reservations according to the 2004 abstract of tax-exempt property.
50.5    (t) The city aid base for a city is increased by $30,000 in 2009 only, and the
50.6maximum total aid it may receive under section 477A.013, subdivision 9, is also increased
50.7by $30,000 in calendar year 2009, only if the city had a population in 2005 of less than
50.83,000 and the city's boundaries as of 2007 were formed by the consolidation of two cities
50.9and one township in 2002.
50.10    (u) The city aid base for a city is increased by $100,000 in 2009 and thereafter, and
50.11the maximum total aid it may receive under section 477A.013, subdivision 9, is also
50.12increased by $100,000 in calendar year 2009 only, if the city had a city net tax capacity for
50.13aids payable in 2007 of less than $150 per capita and the city experienced flooding on
50.14March 14, 2007, that resulted in evacuation of at least 40 homes.
50.15    (v) The city aid base for a city is increased by $100,000 in 2009 to 2013, and the
50.16maximum total aid it may receive under section 477A.013, subdivision 9, is also increased
50.17by $100,000 in calendar year 2009 only, if the city:
50.18    (1) is located outside of the Minneapolis-St. Paul standard metropolitan statistical
50.19area;
50.20    (2) has a 2005 population greater than 7,000 but less than 8,000; and
50.21    (3) has a 2005 net tax capacity per capita of less than $500.
50.22    (w) The city aid base is increased by $25,000 in calendar years 2009 to 2013 and the
50.23maximum amount of total aid it may receive under section 477A.013, subdivision 9, is
50.24increased by $25,000 in calendar year 2009 only, provided that:
50.25    (1) the city is located in the seven-county metropolitan area;
50.26    (2) its population in 2006 is less than 200; and
50.27    (3) the percentage of its housing stock built before 1940, according to the 2000
50.28United States Census, is greater than 40 percent.
50.29    (x) The city aid base is increased by $90,000 in calendar year 2009 only and the
50.30minimum and maximum total amount of aid it may receive under section 477A.013,
50.31subdivision 9, is also increased by $90,000 in calendar year 2009 only, provided that the
50.32city is located in the seven-county metropolitan area, has a 2006 population between 5,000
50.33and 7,000 and has a 1997 population of over 7,000.
50.34    (y) In calendar year 2010 only, the city aid base for a city is increased by $225,000 if
50.35it was eligible for a $450,000 payment in calendar year 2008 under Minnesota Statutes
50.362006, section 477A.011, subdivision 36, paragraph (e), and the second half of the payment
51.1under that paragraph in December 2008 was canceled due to the governor's unallotment.
51.2The payment under this paragraph is not subject to any aid reductions under section
51.3477A.0133 or any future unallotment of the city aid under section 16A.152.
51.4(z) The city aid base and the maximum total aid the city may receive under section
51.5477A.013, subdivision 9 , is increased by $25,000 in calendar year 2010 only if:
51.6(1) the city is a first class city in the seven-county metropolitan area with a
51.7population below 300,000; and
51.8(2) the city has made an equivalent grant to its local growers' association to
51.9reimburse up to $1,000 each for membership fees and retail leases for members of the
51.10association who farm in and around Dakota County and who incurred crop damage as a
51.11result of the hail storm in that area on July 10, 2008.
51.12The payment under this paragraph is not subject to any aid reductions under section
51.13477A.0133 or any future unallotment of the city aid under section 16A.152.
51.14(aa) The city aid base for a city is increased by $106,964 in 2011 only and the
51.15minimum and maximum amount of total aid it may receive under section 477A.013,
51.16subdivision 9 , is also increased by $106,964 in calendar year 2011 only, if the city had a
51.17population as defined in Minnesota Statutes, section 477A.011, subdivision 3, that was in
51.18excess of 1,000 in 2007 and that was less than 1,000 in 2008.
51.19(bb) The city aid base for a city is increased by $50,000 in 2011 and 2012 only, and
51.20the minimum and maximum amount of total aid it may receive under section 477A.013,
51.21subdivision 9, is also increased by $50,000 in calendar year 2011 only, if the city is:
51.22(1) located outside of the seven-county metropolitan area;
51.23(2) has a 2008 population between 3,000 and 4,000;
51.24(3) has a commercial industrial percentage as defined in subdivision 32, for aids
51.25payable in 2008 of less than ten percent; and
51.26(4) experienced the loss of a major manufacturing facility in the city due to a fire
51.27in April 2009.
51.28EFFECTIVE DATE.This section is effective for aids payable in calendar year
51.292011 and thereafter.

51.30    Sec. 34. Laws 2009, chapter 88, article 2, section 49, is amended to read:
51.31    Sec. 49. TAX ABATEMENT; NEWLY CONSTRUCTED RESIDENTIAL
51.32STRUCTURES IN FLOOD-DAMAGED CITIES.
51.33    Subdivision 1. Eligibility. A residential structure qualifies for a tax abatement
51.34under this section if:
52.1(1) the structure is located in a city that is eligible to designate a development zone
52.2under Minnesota Statutes, section 469.1731;
52.3(2) the structure is located in a county designated as an emergency area under
52.4presidential declaration FEMA-3304-EM;
52.5(3) the structure is located on property classified as class 1a, 1b, 2a, 4a, 4b, 4bb, or
52.64d under Minnesota Statutes, section 273.13;
52.7(4) no part of the structure was in existence prior to January 1, 2009, unless (i) the
52.8structure is located on property classified as 1a, 1b, 2a, 4b, or 4bb; (ii) a building permit
52.9was issued and construction commenced in 2008; and (iii) as of March 26, 2009, the
52.10property was owned by the original builder, was not subject to any form of purchase
52.11contract or agreement, and had never been occupied; and
52.12(5) construction of the structure is commenced prior to December 31, 2010 2011.
52.13For the purposes of this clause, construction is deemed to have been commenced if a
52.14proper building permit has been issued and the mandatory footing or foundation inspection
52.15has been completed.
52.16    Subd. 2. Application. Application for the abatement authorized under this section
52.17must be filed by January 2 of the year following the year in which construction began,
52.18except that those qualifying structures for which construction commenced in 2008 must
52.19file an application no later than January 2, 2010, for assessment years 2010 and 2011. The
52.20application must be filed with the assessor of the county or city in which the property is
52.21located on a form prescribed by the commissioner of revenue.
52.22    Subd. 3. Tax abated. (a) For a property qualifying under subdivision 1 and
52.23classified as either 1a, 1b, 2a, 4b, or 4bb, the tax attributable to (1) $200,000 of market
52.24value, or (2) the entire market value of the structure, whichever is less, shall be abated.
52.25For a property qualifying under subdivision 1 and classified as class 4a or 4d, the tax
52.26attributable to (1) $20,000 of market value per residential unit, or (2) the entire market
52.27value of the structure, whichever is less, shall be abated.
52.28(b) The abatement under paragraph (a) shall be in effect for two taxes payable years,
52.29corresponding to the two assessment years after construction has begun. The abatement
52.30shall not apply to any special assessments that have been levied against the property.
52.31    Subd. 4. Reimbursement. By May 1 of each taxes payable year in which an
52.32abatement has been authorized under this section, the auditor shall report the amount of
52.33taxes abated for each jurisdiction within the county to the commissioner of revenue, on a
52.34form prescribed by the commissioner. On or before September 1 of each taxes payable
52.35year in which an abatement has been authorized under this section, the commissioner of
53.1revenue shall reimburse each local jurisdiction for the amount of taxes abated for the
53.2year under this section.
53.3    Subd. 5. Appropriation. The amount necessary to make the reimbursements
53.4required under this section is annually appropriated to the commissioner of revenue from
53.5the general fund.
53.6EFFECTIVE DATE.This section is effective the day following final enactment.

53.7    Sec. 35. Laws 2009, chapter 88, article 2, section 49, the effective date, is amended to
53.8read:
53.9EFFECTIVE DATE.This section is effective for assessment years 2010 to 2012
53.102013, for taxes payable in 2011 to 2013 2014.
53.11EFFECTIVE DATE.This section is effective the day following final enactment.

53.12    Sec. 36. FISCAL DISPARITIES STUDY.
53.13The commissioner of revenue shall conduct a study of the metropolitan revenue
53.14distribution program contained in Minnesota Statutes, chapter 473F, commonly known
53.15as the fiscal disparities program. By February 1, 2012, the commissioner shall submit a
53.16report to the chairs and ranking minority members of the house of representatives and
53.17senate tax committees consisting of the findings of the study and identification of issues
53.18for policy makers to consider. The study must analyze:
53.19(1) the extent to which the benefits of economic growth of the region are shared
53.20throughout the region, especially for growth that results from state or regional decisions;
53.21(2) the program's impact on the variability of tax rates across jurisdictions of the
53.22region;
53.23(3) the program's impact on the distribution of homestead property tax burdens
53.24across jurisdictions of the region; and
53.25(4) the relationship between the impacts of the program and overburden on
53.26jurisdictions containing properties that provide regional benefits, specifically the costs
53.27those properties impose on their host jurisdictions in excess of their tax payments.
53.28The report must include a description of other property tax, aid, and local
53.29development programs that interact with the fiscal disparities program.
53.30EFFECTIVE DATE.This section is effective July 1, 2010.

54.1    Sec. 37. THIEF RIVER FALLS AIRPORT AUTHORITY; SPECIAL LEVY
54.2AUTHORITY.
54.3If an airport authority is established under Minnesota Statutes, section 360.042, that
54.4includes the city of Thief River Falls within its boundaries, the authority may exercise
54.5its levy authority through a levy on the referendum market value of the area, as defined
54.6in Minnesota Statutes, section 126C.01, subdivision 3, in lieu of a levy on the net tax
54.7capacity of the area. If an authority exercises its option under this section, the intent to do
54.8so must be stated in the joint agreement establishing the authority.
54.9EFFECTIVE DATE.This section is effective the day following final enactment,
54.10without local approval, as provided by Minnesota Statutes, section 654.023, subdivision 1,
54.11paragraph (a).


54.15    Section 1. [6.90] COUNCIL ON LOCAL RESULTS AND INNOVATION.
54.16    Subdivision 1. Creation. The Council on Local Results and Innovation consists of
54.1711 members, as follows:
54.18(1) the state auditor;
54.19(2) two persons who are not members of the legislature, appointed by the chair of the
54.20Property and Local Sales Tax Division of the house of representatives Taxes Committee;
54.21(3) two persons who are not members of the legislature, appointed by the designated
54.22lead minority member of the Property and Local Sales Tax Division of the house of
54.23representatives Taxes Committee;
54.24(4) two persons who are not members of the legislature, appointed by the chair of
54.25the Taxes Division on Property Taxes of the senate Taxes Committee;
54.26(5) two persons who are not members of the legislature, appointed by the designated
54.27lead minority member of the Taxes Division on Property Taxes of the senate Taxes
54.28Committee;
54.29(6) one person who is not a member of the legislature, appointed by the Association
54.30of Minnesota Counties; and
54.31(7) one person who is not a member of the legislature, appointed by the League
54.32of Minnesota Cities.
54.33Each appointment under clauses (2) to (5) must include one person with expertise
54.34or interest in county government and one person with expertise or interest in city
54.35government. The appointing authorities must use their best efforts to ensure that a majority
55.1of council members have experience with local performance measurement systems. The
55.2membership of the council must include geographically balanced representation as well as
55.3representation balanced between large and small jurisdictions. The appointments under
55.4clauses (2) to (7) must be made within two months of the date of enactment.
55.5Appointees to the council under clauses (2) to (5) serve terms of four years, except
55.6that one of each of the initial appointments under clauses (2) to (5) shall serve a term of
55.7two years; each appointing agent must designate which appointee is serving the two-year
55.8term. Subsequent appointments for members appointed under clauses (2) to (5) must
55.9be made by the council, including appointments to replace any appointees who might
55.10resign from the council prior to completion of their term. Appointees under clauses (2) to
55.11(5) are not eligible to vote on appointing their successor, nor on the successors of other
55.12appointees whose terms are expiring contemporaneously. In making appointments, the
55.13council shall make all possible efforts to reflect the geographical distribution and meet the
55.14qualifications of appointees required of the initial appointees. Subsequent appointments
55.15for members appointed under clauses (6) and (7) must be made by the original appointing
55.16authority. Appointees to the council under clauses (2) to (7) may serve no more than two
55.17consecutive terms.
55.18    Subd. 2. Duties. (a) By February 15, 2011, the council shall develop a standard
55.19set of approximately ten performance measures for counties and ten performance
55.20measures for cities that will aid residents, taxpayers, and state and local elected officials
55.21in determining the efficacy of counties and cities in providing services, and measure
55.22residents' opinions of those services. In developing its measures, the council must solicit
55.23input from private citizens. Counties and cities that elect to participate in the standard
55.24measures system shall report their results to the state auditor under section 6.91, who
55.25shall compile the results and make them available to all interested parties by publishing
55.26them on the auditor's Web site and report them to the legislative tax committees. Each
55.27year after the initial designation of performance measures, the council shall evaluate the
55.28usefulness of the standard set of performance measures and may revise the set by adding
55.29or removing measures as it deems appropriate.
55.30(b) By February 15, 2012, the council shall develop minimum standards for
55.31comprehensive performance measurement systems, which may vary by size and type
55.32of governing jurisdiction.
55.33(c) In addition to its specific duties under paragraphs (a) and (b), the council
55.34shall generally promote the use of performance measurement for governmental entities
55.35across the state and shall serve as a resource for all governmental entities seeking to
55.36implement a system of local performance measurement. The council may highlight and
56.1promote systems that are innovative, or are ones that it deems to be best practices of local
56.2performance measurement systems across the state and nation. The council should give
56.3preference in its recommendations to systems that are results-oriented. The council may,
56.4with the cooperation of the state auditor, establish and foster a collaborative network
56.5of practitioners of local performance measurement systems. The council may support
56.6the Association of Minnesota Counties and the League of Minnesota Cities to seek and
56.7receive private funding to provide expert technical assistance to local governments for
56.8the purposes of replicating best practices.
56.9    Subd. 3. Reports. (a) The council shall report its initial set of standard performance
56.10measures to the Property and Local Sales Tax Division of the house of representatives
56.11Taxes Committee and the Taxes Division on Property Taxes of the senate Taxes Committee
56.12by February 28, 2011.
56.13(b) By February 1 of each subsequent year, the council shall report to the committees
56.14with jurisdiction over taxes in the house of representatives and the senate on participation
56.15in and results of the performance measurement system, along with any revisions in the
56.16standard set of performance measures for the upcoming year. These reports may be made
56.17by the state auditor in lieu of the council if agreed to by the auditor and the council.
56.18    Subd. 4. Operation of council. (a) The state auditor shall convene the initial
56.19meeting of the council.
56.20(b) The chair of the council shall be elected by the members. Once elected, a chair
56.21shall serve a term of two years.
56.22(c) Members of the council serve without compensation.
56.23(d) Council members shall share and rotate responsibilities for administrative
56.24support of the council.
56.25(e) Chapter 13D does not apply to meetings of the council. Meetings of the council
56.26must be open to the public and the council must provide notice of a meeting on the state
56.27auditor's Web site at least seven days before the meeting. A meeting of the council occurs
56.28when a quorum is present.
56.29(f) The council must meet at least two times prior to the initial release of the standard
56.30set of measurements. After the initial set has been developed, the council must meet a
56.31minimum of once per year.
56.32    Subd. 5. Termination. The council expires on January 1, 2020.
56.33EFFECTIVE DATE.This section is effective the day following final enactment.

56.34    Sec. 2. [6.91] LOCAL PERFORMANCE MEASUREMENT AND REPORTING.
57.1    Subdivision 1. Reports of local performance measures. (a) A county or city
57.2that elects to participate in the standard measures program must report its results to its
57.3citizens annually through publication, direct mailing, posting on the jurisdiction's Web
57.4site, or through a public hearing at which the budget and levy will be discussed and public
57.5input allowed.
57.6(b) Each year, jurisdictions participating in the local performance measurement
57.7and improvement program must file a report with the state auditor by July 1, in a form
57.8prescribed by the auditor. All reports must include a declaration that the jurisdiction has
57.9complied with, or will have complied with by the end of the year, the requirement in
57.10paragraph (a). For jurisdictions participating in the standard measures program, the report
57.11shall consist of the jurisdiction's results for the standard set of performance measures
57.12under section 6.90, subdivision 2, paragraph (a). In 2012, jurisdictions participating in the
57.13comprehensive performance measurement program must submit a resolution approved by
57.14its local governing body indicating that it either has implemented or is in the process of
57.15implementing a local performance measurement system that meets the minimum standards
57.16specified by the council under section 6.90, subdivision 2, paragraph (b). In 2013 and
57.17thereafter, jurisdictions participating in the comprehensive performance measurement
57.18program must submit a statement approved by its local governing body affirming that
57.19it has implemented a local performance measurement system that meets the minimum
57.20standards specified by the council under section 6.90, subdivision 2, paragraph (b).
57.21    Subd. 2. Benefits of participation. (a) A county or city that elects to participate in
57.22the standard measures program for 2011 is: (1) eligible for per capita reimbursement of
57.23$0.14 per capita, but not to exceed $25,000 for any government entity; and (2) exempt
57.24from levy limits under sections 275.70 to 275.74 for taxes payable in 2012, if levy limits
57.25are in effect.
57.26(b) Any county or city that elects to participate in the standard measures program
57.27for 2012 is eligible for per capita reimbursement of $0.14 per capita, but not to exceed
57.28$25,000 for any government entity. Any jurisdiction participating in the comprehensive
57.29performance measurement program is exempt from levy limits under sections 275.70 to
57.30275.74 for taxes payable in 2013 if levy limits are in effect.
57.31(c) Any county or city that elects to participate in the standard measures program for
57.322013 or any year thereafter is eligible for per capita reimbursement of $0.14 per capita,
57.33but not to exceed $25,000 for any government entity. Any jurisdiction participating in
57.34the comprehensive performance measurement program for 2013 or any year thereafter is
57.35exempt from levy limits under sections 275.70 to 275.74 for taxes payable in the following
57.36year, if levy limits are in effect.
58.1    Subd. 3. Certification of participation. (a) The state auditor shall certify to
58.2the commissioner of revenue by August 1 of each year the counties and cities that are
58.3participating in the standard measures program and the comprehensive performance
58.4measurement program.
58.5(b) The commissioner of revenue shall make per capita aid payments under this
58.6section on the second payment date specified in section 477A.015, in the same year that
58.7the measurements were reported.
58.8(c) The commissioner of revenue shall notify each county and city that is entitled to
58.9exemption from levy limits by August 10 of each levy year.
58.10    Subd. 4. Appropriation. (a) The amount necessary to fund obligations under
58.11subdivision 2 is annually appropriated from the general fund to the commissioner of
58.12revenue.
58.13(b) The sum of $6,000 in fiscal year 2011 and $2,000 in each fiscal year thereafter is
58.14annually appropriated from the general fund to the state auditor to carry out the auditor's
58.15responsibilities under sections 6.90 to 6.91.
58.16EFFECTIVE DATE.This section is effective December 31, 2010.

58.17    Sec. 3. [270C.991] PROPERTY TAX SYSTEM BENCHMARKS AND
58.18CRITICAL INDICATORS.
58.19    Subdivision 1. Purpose. State policy makers should be provided with the tools to
58.20create a more accountable and efficient property tax system. This section provides the
58.21principles and available tools necessary to work toward achieving that goal.
58.22    Subd. 2. Property tax principles. To better evaluate the various property tax
58.23proposals that come before the legislature, the following basic property tax principles
58.24should be taken into consideration. The property taxes proposed should be:
58.25(1) transparent and understandable;
58.26(2) simple and efficient;
58.27(3) equitable;
58.28(4) stable and predictable;
58.29(5) compliance and accountability;
58.30(6) competitive, both nationally and globally; and
58.31(7) responsive to economic conditions.
58.32    Subd. 3. Major indicators. There are many different types of indicators available to
58.33legislators to evaluate tax legislation. Indicators are useful to have available as benchmarks
58.34when legislators are contemplating changes. Each tool has its own limitation, and no one
58.35tool is perfect or should be used independently. Some of the tools measure the global
59.1characteristics of the entire tax system, while others are only a measure of the property tax
59.2impacts and its administration. The following is a list of the available major indicators:
59.3(1) property tax principles scale, the components of which are listed in subdivision
59.42, as they relate to the various features of the property tax system;
59.5(2) price of government report, as required under section 16A.102;
59.6(3) tax incidence report, as required under section 270C.13;
59.7(4) tax expenditure budget and report, as required under section 270C.11;
59.8(5) state tax rankings;
59.9(6) property tax levy plus aid data, and market value and net tax capacity data, by
59.10taxing district for current and past years;
59.11(7) effective tax rate (tax as a percent of market value) and the equalized effective
59.12tax rate (effective tax rate adjusted for assessment differences);
59.13(8) assessment sales ratio study, as required under section 127A.48;
59.14(9) "Voss" database, which matches homeowner property taxes and household
59.15income;
59.16(10) revenue estimates under section 270C.11, subdivision 5, and state fiscal notes
59.17under section 477A.03, subdivision 2b; and
59.18(11) local impact notes under section 3.987.
59.19    Subd. 4. Property tax working group. (a) A property tax working group is
59.20established as provided in this subdivision. The goals of the working group are:
59.21(1) to investigate ways to simplify the property tax system and make advisory
59.22recommendations on ways to make the system more understandable;
59.23(2) to reexamine the property tax calendar to determine what changes could be made
59.24to shorten the two-year cycle from assessment through property tax collection; and
59.25(3) to determine the cost versus the benefits of the various property tax components,
59.26including property classifications, credits, aids, exclusions, exemptions, and abatements,
59.27and to suggest ways to achieve some of the goals in simpler and more cost-efficient ways.
59.28(b) The 13-member working group shall consist of the following members:
59.29(1) two state representatives, both appointed by the chair of the house of
59.30representatives Taxes Committee, one from the majority party and one from the minority
59.31party;
59.32(2) two senators, both appointed by the chair of the senate Taxes Committee, one
59.33from the majority party and one from the minority party;
59.34(3) the commissioner of revenue, or designee;
59.35(4) one person, appointed by the Association of Minnesota Counties;
59.36(5) one person, appointed by the League of Minnesota Cities;
60.1(6) one person, appointed by the Minnesota Association of Townships;
60.2(7) one person, appointed by the Minnesota Chamber of Commerce;
60.3(8) one person, appointed by the Minnesota Association of Assessing Officers;
60.4(9) two homeowners, one who is under 65 years of age, and one who is 65 years of
60.5age or older, both appointed by the commissioner of revenue; and
60.6(10) one person, jointly appointed by the Minnesota Farm Bureau and the Minnesota
60.7Farmers Union.
60.8The commissioner of revenue shall chair the initial meeting, and the working
60.9group shall elect a chair at that initial meeting. The working group will meet at the call
60.10of the chair. Members of the working group shall serve without compensation. The
60.11commissioner of revenue must provide administrative support to the working group.
60.12Chapter 13D does not apply to meetings of the working group. Meetings of the working
60.13group must be open to the public and the working group must provide notice of a meeting
60.14to potentially interested persons at least seven days before the meeting. A meeting of the
60.15council occurs when a quorum is present.
60.16(c) The working group shall make its advisory recommendations to the chairs of the
60.17house of representatives and senate Taxes Committees on or before February 1, 2012, at
60.18which time the working group shall be finished and this subdivision expires. The advisory
60.19recommendations should be reviewed by the Taxes Committee under subdivision 5.
60.20    Subd. 5. Taxes Committee review and resolution. On or before March 1,
60.212012, and every two years thereafter, the house of representatives and senate Taxes
60.22Committees must review the major indicators as contained in subdivision 3, and ascertain
60.23the accountability and efficiency of the property tax system. The house of representatives
60.24and senate Taxes Committees shall prepare a resolution on targets and benchmarks for
60.25use during the current biennium.
60.26    Subd. 6. Department of Revenue; revenue estimates. As provided under
60.27section 270C.11, subdivision 5, the Department of Revenue is required to prepare an
60.28estimate of the effect on the state's tax revenues which result from the passage of a
60.29legislative bill establishing, extending, or restricting a tax expenditure. Beginning
60.30with the 2011 legislative session, those revenue estimates must also identify how the
60.31property tax principles contained in subdivision 2 apply to the proposed tax changes. The
60.32commissioner of revenue shall develop a scale for measuring the appropriate principles
60.33for each proposed change. The department shall quantify the effects, if possible, or at a
60.34minimum, shall identify the relevant factors so that legislators are aware of possible
60.35outcomes, including administrative difficulties and cost. The interaction of property tax
60.36shifting should be identified and quantified to the degree possible.
61.1    Subd. 7. Appropriation. The sum of $30,000 in fiscal year 2011 and $25,000 in
61.2each fiscal year thereafter is appropriated from the general fund to the commissioner of
61.3revenue to carry out the commissioner's added responsibilities under subdivision 6.
61.4EFFECTIVE DATE.This section is effective the day following final enactment.


61.7    Section 1. Minnesota Statutes 2008, section 289A.08, subdivision 7, is amended to
61.8read:
61.9    Subd. 7. Composite income tax returns for nonresident partners, shareholders,
61.10and beneficiaries. (a) The commissioner may allow a partnership with nonresident
61.11partners to file a composite return and to pay the tax on behalf of nonresident partners who
61.12have no other Minnesota source income. This composite return must include the names,
61.13addresses, Social Security numbers, income allocation, and tax liability for the nonresident
61.14partners electing to be covered by the composite return.
61.15(b) The computation of a partner's tax liability must be determined by multiplying
61.16the income allocated to that partner by the highest rate used to determine the tax liability
61.17for individuals under section 290.06, subdivision 2c. Nonbusiness deductions, standard
61.18deductions, or personal exemptions are not allowed.
61.19(c) The partnership must submit a request to use this composite return filing method
61.20for nonresident partners. The requesting partnership must file a composite return in the
61.21form prescribed by the commissioner of revenue. The filing of a composite return is
61.22considered a request to use the composite return filing method.
61.23(d) The electing partner must not have any Minnesota source income other than
61.24the income from the partnership and other electing partnerships. If it is determined that
61.25the electing partner has other Minnesota source income, the inclusion of the income
61.26and tax liability for that partner under this provision will not constitute a return to
61.27satisfy the requirements of subdivision 1. The tax paid for the individual as part of the
61.28composite return is allowed as a payment of the tax by the individual on the date on
61.29which the composite return payment was made. If the electing nonresident partner has no
61.30other Minnesota source income, filing of the composite return is a return for purposes of
61.31subdivision 1.
61.32(e) This subdivision does not negate the requirement that an individual pay estimated
61.33tax if the individual's liability would exceed the requirements set forth in section 289A.25.
61.34A composite estimate may, however, be filed in a manner similar to and containing the
61.35information required under paragraph (a).
62.1(f) If an electing partner's share of the partnership's gross income from Minnesota
62.2sources is less than the filing requirements for a nonresident under this subdivision, the tax
62.3liability is zero. However, a statement showing the partner's share of gross income must
62.4be included as part of the composite return.
62.5(g) The election provided in this subdivision is only available to a partner who has
62.6no other Minnesota source income and who is either (1) a full-year nonresident individual
62.7or (2) a trust or estate that does not claim a deduction under either section 651 or 661 of
62.8the Internal Revenue Code.
62.9(h) A corporation defined in section 290.9725 and its nonresident shareholders may
62.10make an election under this paragraph. The provisions covering the partnership apply to
62.11the corporation and the provisions applying to the partner apply to the shareholder.
62.12(i) Estates and trusts distributing current income only and the nonresident individual
62.13beneficiaries of the estates or trusts may make an election under this paragraph. The
62.14provisions covering the partnership apply to the estate or trust. The provisions applying to
62.15the partner apply to the beneficiary.
62.16(j) For the purposes of this subdivision, "income" means the partner's share of
62.17federal adjusted gross income from the partnership modified by the additions provided in
62.18section 290.01, subdivision 19a, clauses (6) to (10), and the subtractions provided in: (i)
62.19section 290.01, subdivision 19b, clause (9) (8), to the extent the amount is assignable or
62.20allocable to Minnesota under section 290.17; and (ii) section 290.01, subdivision 19b,
62.21clause (14) (13). The subtraction allowed under section 290.01, subdivision 19b, clause
62.22(9) (8), is only allowed on the composite tax computation to the extent the electing partner
62.23would have been allowed the subtraction.
62.24EFFECTIVE DATE.This section is effective the day following final enactment.

62.25    Sec. 2. Minnesota Statutes 2008, section 289A.09, subdivision 2, is amended to read:
62.26    Subd. 2. Withholding statement. (a) A person required to deduct and withhold
62.27from an employee a tax under section 290.92, subdivision 2a or 3, or 290.923, subdivision
62.282 , or who would have been required to deduct and withhold a tax under section 290.92,
62.29subdivision 2a or 3, or persons required to withhold tax under section 290.923, subdivision
62.302 , determined without regard to section 290.92, subdivision 19, if the employee or payee
62.31had claimed no more than one withholding exemption, or who paid wages or made
62.32payments not subject to withholding under section 290.92, subdivision 2a or 3, or 290.923,
62.33subdivision 2 , to an employee or person receiving royalty payments in excess of $600,
62.34or who has entered into a voluntary withholding agreement with a payee under section
62.35290.92, subdivision 20 , must give every employee or person receiving royalty payments in
63.1respect to the remuneration paid by the person to the employee or person receiving royalty
63.2payments during the calendar year, on or before January 31 of the succeeding year, or, if
63.3employment is terminated before the close of the calendar year, within 30 days after the
63.4date of receipt of a written request from the employee if the 30-day period ends before
63.5January 31, a written statement showing the following:
63.6    (1) name of the person;
63.7    (2) the name of the employee or payee and the employee's or payee's Social Security
63.8account number;
63.9    (3) the total amount of wages as that term is defined in section 290.92, subdivision
63.101 , paragraph (1); the total amount of remuneration subject to withholding under section
63.11290.92, subdivision 20 ; the amount of sick pay as required under section 6051(f) of the
63.12Internal Revenue Code; and the amount of royalties subject to withholding under section
63.13290.923, subdivision 2 ; and
63.14    (4) the total amount deducted and withheld as tax under section 290.92, subdivision
63.152a or 3, or 290.923, subdivision 2.
63.16    (b) The statement required to be furnished by paragraph (a) with respect to any
63.17remuneration must be furnished at those times, must contain the information required, and
63.18must be in the form the commissioner prescribes.
63.19    (c) The commissioner may prescribe rules providing for reasonable extensions of
63.20time, not in excess of 30 days, to employers or payers required to give the statements to
63.21their employees or payees under this subdivision.
63.22    (d) A duplicate of any statement made under this subdivision and in accordance
63.23with rules prescribed by the commissioner, along with a reconciliation in the form the
63.24commissioner prescribes of the statements for the calendar year, including a reconciliation
63.25of the quarterly returns required to be filed under subdivision 1, must be filed with the
63.26commissioner on or before February 28 of the year after the payments were made.
63.27    (e) If an employer cancels the employer's Minnesota withholding account number
63.28required by section 290.92, subdivision 24, the information required by paragraph (d),
63.29must be filed with the commissioner within 30 days of the end of the quarter in which
63.30the employer cancels its account number.
63.31    (f) The employer must submit the statements required to be sent to the commissioner
63.32in the same manner required to satisfy the federal reporting requirements of section
63.336011(e) of the Internal Revenue Code and the regulations issued under it. For wages paid
63.34in calendar year 2008, An employer must submit statements to the commissioner required
63.35by this section by electronic means if the employer is required to send more than 100
63.3625 statements to the commissioner, even though the employer is not required to submit
64.1the returns federally by electronic means. For calendar year 2009, the 100 statements
64.2threshold is reduced to 50, and for calendar year 2010, the threshold is reduced to 25, and
64.3for statements issued for wages paid in 2011 and after, the threshold is reduced to ten.
64.4All statements issued for withholding required under section 290.92 are aggregated for
64.5purposes of determining whether the electronic submission threshold is met.
64.6    (g) A "third-party bulk filer" as defined in section 290.92, subdivision 30, paragraph
64.7(a), clause (2), must submit the returns required by this subdivision and subdivision 1,
64.8paragraph (a), with the commissioner by electronic means.
64.9EFFECTIVE DATE.This section is effective for statements required to be filed
64.10after December 31, 2010.

64.11    Sec. 3. Minnesota Statutes 2008, section 289A.10, subdivision 1, is amended to read:
64.12    Subdivision 1. Return required. In the case of a decedent who has an interest in
64.13property with a situs in Minnesota, the personal representative must submit a Minnesota
64.14estate tax return to the commissioner, on a form prescribed by the commissioner, if:
64.15(1) a federal estate tax return is required to be filed; or
64.16(2) the federal gross estate exceeds $700,000 for estates of decedents dying after
64.17December 31, 2001, and before January 1, 2004; $850,000 for estates of decedents dying
64.18after December 31, 2003, and before January 1, 2005; $950,000 for estates of decedents
64.19dying after December 31, 2004, and before January 1, 2006; and $1,000,000 for estates of
64.20decedents dying after December 31, 2005.
64.21The return must contain a computation of the Minnesota estate tax due. The return
64.22must be signed by the personal representative.
64.23EFFECTIVE DATE.This section is effective for estates of decedents dying after
64.24December 31, 2005.

64.25    Sec. 4. Minnesota Statutes 2008, section 289A.12, subdivision 14, is amended to read:
64.26    Subd. 14. Regulated investment companies; reporting exempt-interest
64.27dividends. (a) A regulated investment company paying $10 or more in exempt-interest
64.28dividends to an individual who is a resident of Minnesota must make a return indicating
64.29the amount of the exempt-interest dividends, the name, address, and Social Security
64.30number of the recipient, and any other information that the commissioner specifies. The
64.31return must be provided to the shareholder no later than 30 days after the close of the
64.32taxable year by February 15 of the year following the year of the payment. The return
64.33provided to the shareholder must include a clear statement, in the form prescribed by the
65.1commissioner, that the exempt-interest dividends must be included in the computation of
65.2Minnesota taxable income. The regulated investment company is required in a manner
65.3prescribed by the commissioner to file a copy of the return with the commissioner. By
65.4June 1 of each year, the regulated investment company must file a copy of the return
65.5with the commissioner.
65.6    (b) This subdivision applies to regulated investment companies required to register
65.7under chapter 80A.
65.8    (c) For purposes of this subdivision, the following definitions apply.
65.9    (1) "Exempt-interest dividends" mean exempt-interest dividends as defined in
65.10section 852(b)(5) of the Internal Revenue Code, but does not include the portion of
65.11exempt-interest dividends that are not required to be added to federal taxable income
65.12under section 290.01, subdivision 19a, clause (1)(ii).
65.13    (2) "Regulated investment company" means regulated investment company as
65.14defined in section 851(a) of the Internal Revenue Code or a fund of the regulated
65.15investment company as defined in section 851(g) of the Internal Revenue Code.
65.16EFFECTIVE DATE.This section is effective for returns due after December 31,
65.172010.

65.18    Sec. 5. Minnesota Statutes 2009 Supplement, section 289A.18, subdivision 1, is
65.19amended to read:
65.20    Subdivision 1. Individual income, fiduciary income, corporate franchise, and
65.21entertainment taxes; partnership and S corporation returns; information returns;
65.22mining company returns. The returns required to be made under sections 289A.08 and
65.23289A.12 must be filed at the following times:
65.24    (1) returns made on the basis of the calendar year must be filed on April 15
65.25following the close of the calendar year, except that returns of corporations must be filed
65.26on March 15 following the close of the calendar year the due date for filing the federal
65.27income tax return;
65.28    (2) returns made on the basis of the fiscal year must be filed on the 15th day of the
65.29fourth month following the close of the fiscal year, except that returns of corporations
65.30must be filed on the 15th day of the third month following the close of the fiscal year due
65.31date for filing the federal income tax return;
65.32    (3) returns for a fractional part of a year must be filed on the 15th day of the fourth
65.33month following the end of the month in which falls the last day of the period for which
65.34the return is made, except that the returns of corporations must be filed on the 15th day of
65.35the third month following the end of the tax year; or, in the case of a corporation which
66.1is a member of a unitary group, the return of the corporation must be filed on the 15th
66.2day of the third month following the end of the tax year of the unitary group in which
66.3falls the last day of the period for which the return is made due date for filing the federal
66.4income tax return;
66.5    (4) in the case of a final return of a decedent for a fractional part of a year, the return
66.6must be filed on the 15th day of the fourth month following the close of the 12-month
66.7period that began with the first day of that fractional part of a year;
66.8    (5) in the case of the return of a cooperative association, returns must be filed on or
66.9before the 15th day of the ninth month following the close of the taxable year;
66.10    (6) if a corporation has been divested from a unitary group and files a return for
66.11a fractional part of a year in which it was a member of a unitary business that files a
66.12combined report under section 290.17, subdivision 4, the divested corporation's return
66.13must be filed on the 15th day of the third month following the close of the common
66.14accounting period that includes the fractional year;
66.15    (7) returns of entertainment entities must be filed on April 15 following the close of
66.16the calendar year;
66.17    (8) returns required to be filed under section 289A.08, subdivision 4, must be filed
66.18on the 15th day of the fifth month following the close of the taxable year;
66.19    (9) returns of mining companies must be filed on May 1 following the close of the
66.20calendar year; and
66.21    (10) returns required to be filed with the commissioner under section 289A.12,
66.22subdivision 2 , 4 to 10, or 16 must be filed within 30 days after being demanded by the
66.23commissioner.
66.24EFFECTIVE DATE.This section is effective for taxable years beginning after
66.25December 31, 2009.

66.26    Sec. 6. Minnesota Statutes 2008, section 289A.30, subdivision 2, is amended to read:
66.27    Subd. 2. Estate tax. Where good cause exists, the commissioner may extend the
66.28time for payment of estate tax for a period of not more than six months. If an extension to
66.29pay the federal estate tax has been granted under section 6161 of the Internal Revenue
66.30Code, the time for payment of the estate tax without penalty is extended for that period. A
66.31taxpayer who owes at least $5,000 in taxes and who, under section 6161 or 6166 of the
66.32Internal Revenue Code has been granted an extension for payment of the tax shown on the
66.33return, may elect to pay the tax due to the commissioner in equal amounts at the same
66.34time as required for federal purposes. A taxpayer electing to pay the tax in installments
66.35shall defer a percentage of tax that does not exceed the percentage of federal tax deferred
67.1and must notify the commissioner in writing no later than nine months after the death of
67.2the person whose estate is subject to taxation. If the taxpayer fails to pay an installment on
67.3time, unless it is shown that the failure is due to reasonable cause, the election is revoked
67.4and the entire amount of unpaid tax plus accrued interest is due and payable 90 days after
67.5the date on which the installment was payable.
67.6EFFECTIVE DATE.This section is effective the day following final enactment.

67.7    Sec. 7. Minnesota Statutes 2008, section 289A.50, subdivision 4, is amended to read:
67.8    Subd. 4. Notice of refund. The commissioner shall determine the amount of refund,
67.9if any, that is due, and notify the taxpayer of the determination as soon as practicable
67.10after a claim has been filed.
67.11If the commissioner determines that the address provided by the taxpayer to claim a
67.12refund is invalid or is no longer the current address of the taxpayer, then the date of the
67.13mailing of the notification provided under this subdivision is considered the date that
67.14the refund is paid for purposes of the payment of interest under section 289A.56 and is
67.15considered the date of issuance of the original warrant or check for purposes of issuing a
67.16new warrant or check under section 270C.347.
67.17EFFECTIVE DATE.This section is effective the day following final enactment.

67.18    Sec. 8. Minnesota Statutes 2008, section 289A.60, subdivision 7, is amended to read:
67.19    Subd. 7. Penalty for frivolous return. If a taxpayer files what purports to be
67.20a tax return or a claim for refund but which does not contain information on which
67.21the substantial correctness of the purported return or claim for refund may be judged
67.22or contains information that on its face shows that the purported return or claim for
67.23refund is substantially incorrect and the conduct is due to a position that is frivolous or
67.24a desire that appears on the purported return or claim for refund to delay or impede the
67.25administration of Minnesota tax laws, then the individual taxpayer shall pay a penalty of
67.26the greater of $1,000 or 25 percent of the amount of tax required to be shown on the
67.27return. In a proceeding involving the issue of whether or not a person taxpayer is liable for
67.28this penalty, the burden of proof is on the commissioner.
67.29EFFECTIVE DATE.This section is effective the day following final enactment
67.30and applies to returns filed after that day.

67.31    Sec. 9. Minnesota Statutes 2009 Supplement, section 290.01, subdivision 19a, is
67.32amended to read:
68.1    Subd. 19a. Additions to federal taxable income. For individuals, estates, and
68.2trusts, there shall be added to federal taxable income:
68.3    (1)(i) interest income on obligations of any state other than Minnesota or a political
68.4or governmental subdivision, municipality, or governmental agency or instrumentality
68.5of any state other than Minnesota exempt from federal income taxes under the Internal
68.6Revenue Code or any other federal statute; and
68.7    (ii) exempt-interest dividends as defined in section 852(b)(5) of the Internal Revenue
68.8Code, except:
68.9(A) the portion of the exempt-interest dividends exempt from state taxation under
68.10the laws of the United States; and
68.11(B) the portion of the exempt-interest dividends derived from interest income
68.12on obligations of the state of Minnesota or its political or governmental subdivisions,
68.13municipalities, governmental agencies or instrumentalities, but only if the portion of the
68.14exempt-interest dividends from such Minnesota sources paid to all shareholders represents
68.1595 percent or more of the exempt-interest dividends, including any dividends exempt
68.16under subitem (A), that are paid by the regulated investment company as defined in section
68.17851(a) of the Internal Revenue Code, or the fund of the regulated investment company as
68.18defined in section 851(g) of the Internal Revenue Code, making the payment; and
68.19    (iii) for the purposes of items (i) and (ii), interest on obligations of an Indian tribal
68.20government described in section 7871(c) of the Internal Revenue Code shall be treated as
68.21interest income on obligations of the state in which the tribe is located;
68.22    (2) the amount of income, sales and use, motor vehicle sales, or excise taxes paid
68.23or accrued within the taxable year under this chapter and the amount of taxes based on
68.24net income paid, sales and use, motor vehicle sales, or excise taxes paid to any other
68.25state or to any province or territory of Canada, to the extent allowed as a deduction
68.26under section 63(d) of the Internal Revenue Code, but the addition may not be more
68.27than the amount by which the itemized deductions as allowed under section 63(d) of
68.28the Internal Revenue Code exceeds the amount of the standard deduction as defined in
68.29section 63(c) of the Internal Revenue Code, disregarding the amounts allowed under
68.30sections 63(c)(1)(C) and 63(c)(1)(E) of the Internal Revenue Code. For the purpose of
68.31this paragraph, the disallowance of itemized deductions under section 68 of the Internal
68.32Revenue Code of 1986, income, sales and use, motor vehicle sales, or excise taxes are
68.33the last itemized deductions disallowed;
68.34    (3) the capital gain amount of a lump-sum distribution to which the special tax under
68.35section 1122(h)(3)(B)(ii) of the Tax Reform Act of 1986, Public Law 99-514, applies;
69.1    (4) the amount of income taxes paid or accrued within the taxable year under this
69.2chapter and taxes based on net income paid to any other state or any province or territory
69.3of Canada, to the extent allowed as a deduction in determining federal adjusted gross
69.4income. For the purpose of this paragraph, income taxes do not include the taxes imposed
69.5by sections 290.0922, subdivision 1, paragraph (b), 290.9727, 290.9728, and 290.9729;
69.6    (5) the amount of expense, interest, or taxes disallowed pursuant to section 290.10
69.7other than expenses or interest used in computing net interest income for the subtraction
69.8allowed under subdivision 19b, clause (1);
69.9    (6) the amount of a partner's pro rata share of net income which does not flow
69.10through to the partner because the partnership elected to pay the tax on the income under
69.11section 6242(a)(2) of the Internal Revenue Code;
69.12    (7) 80 percent of the depreciation deduction allowed under section 168(k) of the
69.13Internal Revenue Code. For purposes of this clause, if the taxpayer has an activity that
69.14in the taxable year generates a deduction for depreciation under section 168(k) and the
69.15activity generates a loss for the taxable year that the taxpayer is not allowed to claim for
69.16the taxable year, "the depreciation allowed under section 168(k)" for the taxable year is
69.17limited to excess of the depreciation claimed by the activity under section 168(k) over the
69.18amount of the loss from the activity that is not allowed in the taxable year. In succeeding
69.19taxable years when the losses not allowed in the taxable year are allowed, the depreciation
69.20under section 168(k) is allowed;
69.21    (8) 80 percent of the amount by which the deduction allowed by section 179 of the
69.22Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal
69.23Revenue Code of 1986, as amended through December 31, 2003;
69.24    (9) to the extent deducted in computing federal taxable income, the amount of the
69.25deduction allowable under section 199 of the Internal Revenue Code;
69.26    (10) the exclusion allowed under section 139A of the Internal Revenue Code for
69.27federal subsidies for prescription drug plans;
69.28(11) the amount of expenses disallowed under section 290.10, subdivision 2;
69.29    (12) the amount deducted for qualified tuition and related expenses under section
69.30222 of the Internal Revenue Code, to the extent deducted from gross income;
69.31    (13) the amount deducted for certain expenses of elementary and secondary school
69.32teachers under section 62(a)(2)(D) of the Internal Revenue Code, to the extent deducted
69.33from gross income;
69.34(14) the additional standard deduction for property taxes payable that is allowable
69.35under section 63(c)(1)(C) of the Internal Revenue Code;
70.1(15) the additional standard deduction for qualified motor vehicle sales taxes
70.2allowable under section 63(c)(1)(E) of the Internal Revenue Code;
70.3(16) discharge of indebtedness income resulting from reacquisition of business
70.4indebtedness and deferred under section 108(i) of the Internal Revenue Code; and
70.5(17) the amount of unemployment compensation exempt from tax under section
70.685(c) of the Internal Revenue Code.
70.7EFFECTIVE DATE.This section is effective the day following final enactment.

70.8    Sec. 10. Minnesota Statutes 2009 Supplement, section 290.01, subdivision 19b, as
70.9amended by Laws 2010, chapter 187, section 2, is amended to read:
70.10    Subd. 19b. Subtractions from federal taxable income. For individuals, estates,
70.11and trusts, there shall be subtracted from federal taxable income:
70.12    (1) net interest income on obligations of any authority, commission, or
70.13instrumentality of the United States to the extent includable in taxable income for federal
70.14income tax purposes but exempt from state income tax under the laws of the United States;
70.15    (2) if included in federal taxable income, the amount of any overpayment of income
70.16tax to Minnesota or to any other state, for any previous taxable year, whether the amount
70.17is received as a refund or as a credit to another taxable year's income tax liability;
70.18    (3) the amount paid to others, less the amount used to claim the credit allowed under
70.19section 290.0674, not to exceed $1,625 for each qualifying child in grades kindergarten
70.20to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and
70.21transportation of each qualifying child in attending an elementary or secondary school
70.22situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a
70.23resident of this state may legally fulfill the state's compulsory attendance laws, which
70.24is not operated for profit, and which adheres to the provisions of the Civil Rights Act
70.25of 1964 and chapter 363A. For the purposes of this clause, "tuition" includes fees or
70.26tuition as defined in section 290.0674, subdivision 1, clause (1). As used in this clause,
70.27"textbooks" includes books and other instructional materials and equipment purchased
70.28or leased for use in elementary and secondary schools in teaching only those subjects
70.29legally and commonly taught in public elementary and secondary schools in this state.
70.30Equipment expenses qualifying for deduction includes expenses as defined and limited in
70.31section 290.0674, subdivision 1, clause (3). "Textbooks" does not include instructional
70.32books and materials used in the teaching of religious tenets, doctrines, or worship, the
70.33purpose of which is to instill such tenets, doctrines, or worship, nor does it include books
70.34or materials for, or transportation to, extracurricular activities including sporting events,
70.35musical or dramatic events, speech activities, driver's education, or similar programs. No
71.1deduction is permitted for any expense the taxpayer incurred in using the taxpayer's or
71.2the qualifying child's vehicle to provide such transportation for a qualifying child. For
71.3purposes of the subtraction provided by this clause, "qualifying child" has the meaning
71.4given in section 32(c)(3) of the Internal Revenue Code;
71.5    (4) income as provided under section 290.0802;
71.6    (5) to the extent included in federal adjusted gross income, income realized on
71.7disposition of property exempt from tax under section 290.491;
71.8    (6) to the extent not deducted or not deductible pursuant to section 408(d)(8)(E)
71.9of the Internal Revenue Code in determining federal taxable income by an individual
71.10who does not itemize deductions for federal income tax purposes for the taxable year, an
71.11amount equal to 50 percent of the excess of charitable contributions over $500 allowable
71.12as a deduction for the taxable year under section 170(a) of the Internal Revenue Code,
71.13under the provisions of Public Law 109-1 and Public Law 111-126;
71.14    (7) for taxable years beginning before January 1, 2008, the amount of the federal
71.15small ethanol producer credit allowed under section 40(a)(3) of the Internal Revenue Code
71.16which is included in gross income under section 87 of the Internal Revenue Code;
71.17    (8) (7) for individuals who are allowed a federal foreign tax credit for taxes that do
71.18not qualify for a credit under section 290.06, subdivision 22, an amount equal to the
71.19carryover of subnational foreign taxes for the taxable year, but not to exceed the total
71.20subnational foreign taxes reported in claiming the foreign tax credit. For purposes of
71.21this clause, "federal foreign tax credit" means the credit allowed under section 27 of the
71.22Internal Revenue Code, and "carryover of subnational foreign taxes" equals the carryover
71.23allowed under section 904(c) of the Internal Revenue Code minus national level foreign
71.24taxes to the extent they exceed the federal foreign tax credit;
71.25    (9) (8) in each of the five tax years immediately following the tax year in which an
71.26addition is required under subdivision 19a, clause (7), or 19c, clause (15), in the case
71.27of a shareholder of a corporation that is an S corporation, an amount equal to one-fifth
71.28of the delayed depreciation. For purposes of this clause, "delayed depreciation" means
71.29the amount of the addition made by the taxpayer under subdivision 19a, clause (7), or
71.30subdivision 19c, clause (15), in the case of a shareholder of an S corporation, minus the
71.31positive value of any net operating loss under section 172 of the Internal Revenue Code
71.32generated for the tax year of the addition. The resulting delayed depreciation cannot be
71.33less than zero;
71.34    (10) (9) job opportunity building zone income as provided under section 469.316;
71.35    (11) (10) to the extent included in federal taxable income, the amount of
71.36compensation paid to members of the Minnesota National Guard or other reserve
72.1components of the United States military for active service performed in Minnesota,
72.2excluding compensation for services performed under the Active Guard Reserve (AGR)
72.3program. For purposes of this clause, "active service" means (i) state active service as
72.4defined in section 190.05, subdivision 5a, clause (1); (ii) federally funded state active
72.5service as defined in section 190.05, subdivision 5b; or (iii) federal active service as
72.6defined in section 190.05, subdivision 5c, but "active service" excludes service performed
72.7in accordance with section 190.08, subdivision 3;
72.8    (12) (11) to the extent included in federal taxable income, the amount of
72.9compensation paid to Minnesota residents who are members of the armed forces of the
72.10United States or United Nations for active duty performed outside Minnesota under United
72.11States Code, title 10, section 101(d); United States Code, title 32, section 101(12); or the
72.12authority of the United Nations;
72.13    (13) (12) an amount, not to exceed $10,000, equal to qualified expenses related to a
72.14qualified donor's donation, while living, of one or more of the qualified donor's organs
72.15to another person for human organ transplantation. For purposes of this clause, "organ"
72.16means all or part of an individual's liver, pancreas, kidney, intestine, lung, or bone marrow;
72.17"human organ transplantation" means the medical procedure by which transfer of a human
72.18organ is made from the body of one person to the body of another person; "qualified
72.19expenses" means unreimbursed expenses for both the individual and the qualified donor
72.20for (i) travel, (ii) lodging, and (iii) lost wages net of sick pay, except that such expenses
72.21may be subtracted under this clause only once; and "qualified donor" means the individual
72.22or the individual's dependent, as defined in section 152 of the Internal Revenue Code. An
72.23individual may claim the subtraction in this clause for each instance of organ donation for
72.24transplantation during the taxable year in which the qualified expenses occur;
72.25    (14) (13) in each of the five tax years immediately following the tax year in which an
72.26addition is required under subdivision 19a, clause (8), or 19c, clause (16), in the case of a
72.27shareholder of a corporation that is an S corporation, an amount equal to one-fifth of the
72.28addition made by the taxpayer under subdivision 19a, clause (8), or 19c, clause (16), in the
72.29case of a shareholder of a corporation that is an S corporation, minus the positive value of
72.30any net operating loss under section 172 of the Internal Revenue Code generated for the
72.31tax year of the addition. If the net operating loss exceeds the addition for the tax year, a
72.32subtraction is not allowed under this clause;
72.33    (15) (14) to the extent included in federal taxable income, compensation paid to a
72.34service member as defined in United States Code, title 10, section 101(a)(5), for military
72.35service as defined in the Servicemembers Civil Relief Act, Public Law 108-189, section
72.36101(2);
73.1    (16) (15) international economic development zone income as provided under
73.2section 469.325;
73.3    (17) (16) to the extent included in federal taxable income, the amount of national
73.4service educational awards received from the National Service Trust under United States
73.5Code, title 42, sections 12601 to 12604, for service in an approved Americorps National
73.6Service program; and
73.7(18) (17) to the extent included in federal taxable income, discharge of indebtedness
73.8income resulting from reacquisition of business indebtedness included in federal taxable
73.9income under section 108(i) of the Internal Revenue Code. This subtraction applies only
73.10to the extent that the income was included in net income in a prior year as a result of the
73.11addition under section 290.01, subdivision 19a, clause (16).
73.12EFFECTIVE DATE.This section is effective the day following final enactment.

73.13    Sec. 11. Minnesota Statutes 2009 Supplement, section 290.01, subdivision 19d,
73.14is amended to read:
73.15    Subd. 19d. Corporations; modifications decreasing federal taxable income. For
73.16corporations, there shall be subtracted from federal taxable income after the increases
73.17provided in subdivision 19c:
73.18    (1) the amount of foreign dividend gross-up added to gross income for federal
73.19income tax purposes under section 78 of the Internal Revenue Code;
73.20    (2) the amount of salary expense not allowed for federal income tax purposes due to
73.21claiming the work opportunity credit under section 51 of the Internal Revenue Code;
73.22    (3) any dividend (not including any distribution in liquidation) paid within the
73.23taxable year by a national or state bank to the United States, or to any instrumentality of
73.24the United States exempt from federal income taxes, on the preferred stock of the bank
73.25owned by the United States or the instrumentality;
73.26    (4) amounts disallowed for intangible drilling costs due to differences between
73.27this chapter and the Internal Revenue Code in taxable years beginning before January
73.281, 1987, as follows:
73.29    (i) to the extent the disallowed costs are represented by physical property, an amount
73.30equal to the allowance for depreciation under Minnesota Statutes 1986, section 290.09,
73.31subdivision 7 , subject to the modifications contained in subdivision 19e; and
73.32    (ii) to the extent the disallowed costs are not represented by physical property, an
73.33amount equal to the allowance for cost depletion under Minnesota Statutes 1986, section
73.34290.09, subdivision 8 ;
74.1    (5) the deduction for capital losses pursuant to sections 1211 and 1212 of the
74.2Internal Revenue Code, except that:
74.3    (i) for capital losses incurred in taxable years beginning after December 31, 1986,
74.4capital loss carrybacks shall not be allowed;
74.5    (ii) for capital losses incurred in taxable years beginning after December 31, 1986,
74.6a capital loss carryover to each of the 15 taxable years succeeding the loss year shall be
74.7allowed;
74.8    (iii) for capital losses incurred in taxable years beginning before January 1, 1987, a
74.9capital loss carryback to each of the three taxable years preceding the loss year, subject to
74.10the provisions of Minnesota Statutes 1986, section 290.16, shall be allowed; and
74.11    (iv) for capital losses incurred in taxable years beginning before January 1, 1987,
74.12a capital loss carryover to each of the five taxable years succeeding the loss year to the
74.13extent such loss was not used in a prior taxable year and subject to the provisions of
74.14Minnesota Statutes 1986, section 290.16, shall be allowed;
74.15    (6) an amount for interest and expenses relating to income not taxable for federal
74.16income tax purposes, if (i) the income is taxable under this chapter and (ii) the interest and
74.17expenses were disallowed as deductions under the provisions of section 171(a)(2), 265 or
74.18291 of the Internal Revenue Code in computing federal taxable income;
74.19    (7) in the case of mines, oil and gas wells, other natural deposits, and timber for
74.20which percentage depletion was disallowed pursuant to subdivision 19c, clause (9), a
74.21reasonable allowance for depletion based on actual cost. In the case of leases the deduction
74.22must be apportioned between the lessor and lessee in accordance with rules prescribed
74.23by the commissioner. In the case of property held in trust, the allowable deduction must
74.24be apportioned between the income beneficiaries and the trustee in accordance with the
74.25pertinent provisions of the trust, or if there is no provision in the instrument, on the basis
74.26of the trust's income allocable to each;
74.27    (8) for certified pollution control facilities placed in service in a taxable year
74.28beginning before December 31, 1986, and for which amortization deductions were elected
74.29under section 169 of the Internal Revenue Code of 1954, as amended through December
74.3031, 1985, an amount equal to the allowance for depreciation under Minnesota Statutes
74.311986, section 290.09, subdivision 7;
74.32    (9) amounts included in federal taxable income that are due to refunds of income,
74.33excise, or franchise taxes based on net income or related minimum taxes paid by the
74.34corporation to Minnesota, another state, a political subdivision of another state, the
74.35District of Columbia, or a foreign country or possession of the United States to the extent
75.1that the taxes were added to federal taxable income under section 290.01, subdivision 19c,
75.2clause (1), in a prior taxable year;
75.3    (10) 80 percent of royalties, fees, or other like income accrued or received from a
75.4foreign operating corporation or a foreign corporation which is part of the same unitary
75.5business as the receiving corporation, unless the income resulting from such payments or
75.6accruals is income from sources within the United States as defined in subtitle A, chapter
75.71, subchapter N, part 1, of the Internal Revenue Code;
75.8    (11) income or gains from the business of mining as defined in section 290.05,
75.9subdivision 1 , clause (a), that are not subject to Minnesota franchise tax;
75.10    (12) the amount of disability access expenditures in the taxable year which are not
75.11allowed to be deducted or capitalized under section 44(d)(7) of the Internal Revenue Code;
75.12    (13) the amount of qualified research expenses not allowed for federal income tax
75.13purposes under section 280C(c) of the Internal Revenue Code, but only to the extent that
75.14the amount exceeds the amount of the credit allowed under section 290.068;
75.15    (14) the amount of salary expenses not allowed for federal income tax purposes due
75.16to claiming the Indian employment credit under section 45A(a) of the Internal Revenue
75.17Code;
75.18    (15) for taxable years beginning before January 1, 2008, the amount of the federal
75.19small ethanol producer credit allowed under section 40(a)(3) of the Internal Revenue Code
75.20which is included in gross income under section 87 of the Internal Revenue Code;
75.21    (16) (15) for a corporation whose foreign sales corporation, as defined in section
75.22922 of the Internal Revenue Code, constituted a foreign operating corporation during any
75.23taxable year ending before January 1, 1995, and a return was filed by August 15, 1996,
75.24claiming the deduction under section 290.21, subdivision 4, for income received from
75.25the foreign operating corporation, an amount equal to 1.23 multiplied by the amount of
75.26income excluded under section 114 of the Internal Revenue Code, provided the income is
75.27not income of a foreign operating company;
75.28    (17) (16) any decrease in subpart F income, as defined in section 952(a) of the
75.29Internal Revenue Code, for the taxable year when subpart F income is calculated without
75.30regard to the provisions of Division C, title III, section 303(b) of Public Law 110-343;
75.31    (18) (17) in each of the five tax years immediately following the tax year in which
75.32an addition is required under subdivision 19c, clause (15), an amount equal to one-fifth
75.33of the delayed depreciation. For purposes of this clause, "delayed depreciation" means
75.34the amount of the addition made by the taxpayer under subdivision 19c, clause (15). The
75.35resulting delayed depreciation cannot be less than zero;
76.1    (19) (18) in each of the five tax years immediately following the tax year in which an
76.2addition is required under subdivision 19c, clause (16), an amount equal to one-fifth of
76.3the amount of the addition; and
76.4(20) (19) to the extent included in federal taxable income, discharge of indebtedness
76.5income resulting from reacquisition of business indebtedness included in federal taxable
76.6income under section 108(i) of the Internal Revenue Code. This subtraction applies only
76.7to the extent that the income was included in net income in a prior year as a result of the
76.8addition under section 290.01, subdivision 19c, clause (25).
76.9EFFECTIVE DATE.This section is effective the day following final enactment.

76.10    Sec. 12. Minnesota Statutes 2008, section 290.014, subdivision 2, is amended to read:
76.11    Subd. 2. Nonresident individuals. Except as provided in section 290.015, a
76.12nonresident individual is subject to the return filing requirements and to tax as provided in
76.13this chapter to the extent that the income of the nonresident individual is:
76.14(1) allocable to this state under section 290.17, 290.191, or 290.20;
76.15(2) taxed to the individual under the Internal Revenue Code (or not taxed under the
76.16Internal Revenue Code by reason of its character but of a character which is taxable under
76.17this chapter) in the individual's capacity as a beneficiary of an estate with income allocable
76.18to this state under section 290.17, 290.191, or 290.20 and the income, taking into account
76.19the income character provisions of section 662(b) of the Internal Revenue Code, would be
76.20allocable to this state under section 290.17, 290.191, or 290.20 if realized by the individual
76.21directly from the source from which realized by the estate;
76.22(3) taxed to the individual under the Internal Revenue Code (or not taxed under the
76.23Internal Revenue Code by reason of its character but of a character that is taxable under
76.24this chapter) in the individual's capacity as a beneficiary or grantor or other person treated
76.25as a substantial owner of a trust with income allocable to this state under section 290.17,
76.26290.191 , or 290.20 and the income, taking into account the income character provisions of
76.27section 652(b), 662(b), or 664(b) of the Internal Revenue Code, would be allocable to this
76.28state under section 290.17, 290.191, or 290.20 if realized by the individual directly from
76.29the source from which realized by the trust;
76.30(4) taxed to the individual under the Internal Revenue Code (or not taxed under the
76.31Internal Revenue Code by reason of its character but of a character which is taxable under
76.32this chapter) in the individual's capacity as a limited or general partner in a partnership
76.33with income allocable to this state under section 290.17, 290.191, or 290.20 and the
76.34income, taking into account the income character provisions of section 702(b) of the
76.35Internal Revenue Code, would be allocable to this state under section 290.17, 290.191,
77.1or 290.20 if realized by the individual directly from the source from which realized by
77.2the partnership; or
77.3(5) taxed to the individual under the Internal Revenue Code (or not taxed under the
77.4Internal Revenue Code by reason of its character but of a character which is taxable under
77.5this chapter) in the individual's capacity as a shareholder of a corporation treated as an
77.6"S" corporation under section 290.9725, and income allocable to this state under section
77.7290.17 , 290.191, or 290.20 and the income, taking into account the income character
77.8provisions of section 1366(b) of the Internal Revenue Code, would be allocable to this
77.9state under section 290.17, 290.191, or 290.20 if realized by the individual directly from
77.10the source from which realized by the corporation; or
77.11(6) taxed to the individual under the Internal Revenue Code (or not taxed under the
77.12Internal Revenue Code by reason of its character but of a character which is taxable under
77.13this chapter) in the individual's capacity as the sole member of a limited liability company
77.14that is disregarded for federal income tax purposes, with income allocable to this state
77.15under section 290.17, 290.191, or 290.20, as though realized by the individual directly
77.16from the source from which it was realized by the limited liability company.
77.17EFFECTIVE DATE.This section is effective the day following final enactment.

77.18    Sec. 13. Minnesota Statutes 2009 Supplement, section 290.06, subdivision 2c, is
77.19amended to read:
77.20    Subd. 2c. Schedules of rates for individuals, estates, and trusts. (a) The income
77.21taxes imposed by this chapter upon married individuals filing joint returns and surviving
77.22spouses as defined in section 2(a) of the Internal Revenue Code must be computed by
77.23applying to their taxable net income the following schedule of rates:
77.24    (1) On the first $25,680, 5.35 percent;
77.25    (2) On all over $25,680, but not over $102,030, 7.05 percent;
77.26    (3) On all over $102,030, 7.85 percent.
77.27    Married individuals filing separate returns, estates, and trusts must compute their
77.28income tax by applying the above rates to their taxable income, except that the income
77.29brackets will be one-half of the above amounts.
77.30    (b) The income taxes imposed by this chapter upon unmarried individuals must be
77.31computed by applying to taxable net income the following schedule of rates:
77.32    (1) On the first $17,570, 5.35 percent;
77.33    (2) On all over $17,570, but not over $57,710, 7.05 percent;
77.34    (3) On all over $57,710, 7.85 percent.
78.1    (c) The income taxes imposed by this chapter upon unmarried individuals qualifying
78.2as a head of household as defined in section 2(b) of the Internal Revenue Code must be
78.3computed by applying to taxable net income the following schedule of rates:
78.4    (1) On the first $21,630, 5.35 percent;
78.5    (2) On all over $21,630, but not over $86,910, 7.05 percent;
78.6    (3) On all over $86,910, 7.85 percent.
78.7    (d) In lieu of a tax computed according to the rates set forth in this subdivision, the
78.8tax of any individual taxpayer whose taxable net income for the taxable year is less than
78.9an amount determined by the commissioner must be computed in accordance with tables
78.10prepared and issued by the commissioner of revenue based on income brackets of not
78.11more than $100. The amount of tax for each bracket shall be computed at the rates set
78.12forth in this subdivision, provided that the commissioner may disregard a fractional part of
78.13a dollar unless it amounts to 50 cents or more, in which case it may be increased to $1.
78.14    (e) An individual who is not a Minnesota resident for the entire year must compute
78.15the individual's Minnesota income tax as provided in this subdivision. After the
78.16application of the nonrefundable credits provided in this chapter, the tax liability must
78.17then be multiplied by a fraction in which:
78.18    (1) the numerator is the individual's Minnesota source federal adjusted gross income
78.19as defined in section 62 of the Internal Revenue Code and increased by the additions
78.20required under section 290.01, subdivision 19a, clauses (1), (5), (6), (7), (8), (9), (12),
78.21(13), (16), and (17), and reduced by the Minnesota assignable portion of the subtraction
78.22for United States government interest under section 290.01, subdivision 19b, clause
78.23(1), and the subtractions under section 290.01, subdivision 19b, clauses (9), (10), (14),
78.24(15), (16), and (18) (8), (9), (13), (14), (15), and (17), after applying the allocation and
78.25assignability provisions of section 290.081, clause (a), or 290.17; and
78.26    (2) the denominator is the individual's federal adjusted gross income as defined in
78.27section 62 of the Internal Revenue Code of 1986, increased by the amounts specified in
78.28section 290.01, subdivision 19a, clauses (1), (5), (6), (7), (8), (9), (12), (13), (16), and
78.29(17), and reduced by the amounts specified in section 290.01, subdivision 19b, clauses (1),
78.30(9), (10), (14), (15), (16), and (18) (8), (9), (13), (14), (15), and (17).
78.31EFFECTIVE DATE.This section is effective the day following final enactment.

78.32    Sec. 14. Minnesota Statutes 2008, section 290.067, subdivision 1, is amended to read:
78.33    Subdivision 1. Amount of credit. (a) A taxpayer may take as a credit against the
78.34tax due from the taxpayer and a spouse, if any, under this chapter an amount equal to the
78.35dependent care credit for which the taxpayer is eligible pursuant to the provisions of
79.1section 21 of the Internal Revenue Code subject to the limitations provided in subdivision
79.22 except that in determining whether the child qualified as a dependent, income received
79.3as a Minnesota family investment program grant or allowance to or on behalf of the child
79.4must not be taken into account in determining whether the child received more than half
79.5of the child's support from the taxpayer, and the provisions of section 32(b)(1)(D) of
79.6the Internal Revenue Code do not apply.
79.7(b) If a child who has not attained the age of six years at the close of the taxable year
79.8is cared for at a licensed family day care home operated by the child's parent, the taxpayer
79.9is deemed to have paid employment-related expenses. If the child is 16 months old or
79.10younger at the close of the taxable year, the amount of expenses deemed to have been paid
79.11equals the maximum limit for one qualified individual under section 21(c) and (d) of the
79.12Internal Revenue Code. If the child is older than 16 months of age but has not attained the
79.13age of six years at the close of the taxable year, the amount of expenses deemed to have
79.14been paid equals the amount the licensee would charge for the care of a child of the same
79.15age for the same number of hours of care.
79.16(c) If a married couple:
79.17(1) has a child who has not attained the age of one year at the close of the taxable
79.18year;
79.19(2) files a joint tax return for the taxable year; and
79.20(3) does not participate in a dependent care assistance program as defined in section
79.21129 of the Internal Revenue Code, in lieu of the actual employment related expenses paid
79.22for that child under paragraph (a) or the deemed amount under paragraph (b), the lesser of
79.23(i) the combined earned income of the couple or (ii) the amount of the maximum limit for
79.24one qualified individual under section 21(c) and (d) of the Internal Revenue Code will
79.25be deemed to be the employment related expense paid for that child. The earned income
79.26limitation of section 21(d) of the Internal Revenue Code shall not apply to this deemed
79.27amount. These deemed amounts apply regardless of whether any employment-related
79.28expenses have been paid.
79.29(d) If the taxpayer is not required and does not file a federal individual income tax
79.30return for the tax year, no credit is allowed for any amount paid to any person unless:
79.31(1) the name, address, and taxpayer identification number of the person are included
79.32on the return claiming the credit; or
79.33(2) if the person is an organization described in section 501(c)(3) of the Internal
79.34Revenue Code and exempt from tax under section 501(a) of the Internal Revenue Code,
79.35the name and address of the person are included on the return claiming the credit.
80.1In the case of a failure to provide the information required under the preceding sentence,
80.2the preceding sentence does not apply if it is shown that the taxpayer exercised due
80.3diligence in attempting to provide the information required.
80.4In the case of a nonresident, part-year resident, or a person who has earned income
80.5not subject to tax under this chapter including earned income excluded pursuant to section
80.6290.01, subdivision 19b , clause (10) (9) or (16) (15), the credit determined under section
80.721 of the Internal Revenue Code must be allocated based on the ratio by which the earned
80.8income of the claimant and the claimant's spouse from Minnesota sources bears to the
80.9total earned income of the claimant and the claimant's spouse.
80.10For residents of Minnesota, the subtractions for military pay under section 290.01,
80.11subdivision 19b , clauses (11) (10) and (12) (11), are not considered "earned income not
80.12subject to tax under this chapter."
80.13For residents of Minnesota, the exclusion of combat pay under section 112 of the
80.14Internal Revenue Code is not considered "earned income not subject to tax under this
80.15chapter."
80.16EFFECTIVE DATE.This section is effective the day following final enactment.

80.17    Sec. 15. Minnesota Statutes 2009 Supplement, section 290.0671, subdivision 1,
80.18is amended to read:
80.19    Subdivision 1. Credit allowed. (a) An individual is allowed a credit against the tax
80.20imposed by this chapter equal to a percentage of earned income. To receive a credit, a
80.21taxpayer must be eligible for a credit under section 32 of the Internal Revenue Code.
80.22(b) For individuals with no qualifying children, the credit equals 1.9125 percent of
80.23the first $4,620 of earned income. The credit is reduced by 1.9125 percent of earned
80.24income or adjusted gross income, whichever is greater, in excess of $5,770, but in no
80.25case is the credit less than zero.
80.26(c) For individuals with one qualifying child, the credit equals 8.5 percent of the first
80.27$6,920 of earned income and 8.5 percent of earned income over $12,080 but less than
80.28$13,450. The credit is reduced by 5.73 percent of earned income or adjusted gross income,
80.29whichever is greater, in excess of $15,080, but in no case is the credit less than zero.
80.30(d) For individuals with two or more qualifying children, the credit equals ten
80.31percent of the first $9,720 of earned income and 20 percent of earned income over
80.32$14,860 but less than $16,800. The credit is reduced by 10.3 percent of earned income
80.33or adjusted gross income, whichever is greater, in excess of $17,890, but in no case is
80.34the credit less than zero.
81.1(e) For a nonresident or part-year resident, the credit must be allocated based on the
81.2percentage calculated under section 290.06, subdivision 2c, paragraph (e).
81.3(f) For a person who was a resident for the entire tax year and has earned income
81.4not subject to tax under this chapter, including income excluded under section 290.01,
81.5subdivision 19b , clause (10) (9) or (16) (15), the credit must be allocated based on the
81.6ratio of federal adjusted gross income reduced by the earned income not subject to tax
81.7under this chapter over federal adjusted gross income. For purposes of this paragraph, the
81.8subtractions for military pay under section 290.01, subdivision 19b, clauses (11) (10) and
81.9(12) (11), are not considered "earned income not subject to tax under this chapter."
81.10For the purposes of this paragraph, the exclusion of combat pay under section 112
81.11of the Internal Revenue Code is not considered "earned income not subject to tax under
81.12this chapter."
81.13(g) For tax years beginning after December 31, 2007, and before December 31,
81.142010, the $5,770 in paragraph (b), the $15,080 in paragraph (c), and the $17,890 in
81.15paragraph (d), after being adjusted for inflation under subdivision 7, are each increased by
81.16$3,000 for married taxpayers filing joint returns. For tax years beginning after December
81.1731, 2008, the commissioner shall annually adjust the $3,000 by the percentage determined
81.18pursuant to the provisions of section 1(f) of the Internal Revenue Code, except that in
81.19section 1(f)(3)(B), the word "2007" shall be substituted for the word "1992." For 2009,
81.20the commissioner shall then determine the percent change from the 12 months ending on
81.21August 31, 2007, to the 12 months ending on August 31, 2008, and in each subsequent
81.22year, from the 12 months ending on August 31, 2007, to the 12 months ending on August
81.2331 of the year preceding the taxable year. The earned income thresholds as adjusted
81.24for inflation must be rounded to the nearest $10. If the amount ends in $5, the amount
81.25is rounded up to the nearest $10. The determination of the commissioner under this
81.26subdivision is not a rule under the Administrative Procedure Act.
81.27(h) The commissioner shall construct tables showing the amount of the credit at
81.28various income levels and make them available to taxpayers. The tables shall follow
81.29the schedule contained in this subdivision, except that the commissioner may graduate
81.30the transition between income brackets.
81.31EFFECTIVE DATE.This section is effective the day following final enactment.

81.32    Sec. 16. Minnesota Statutes 2008, section 290.081, is amended to read:
81.33290.081 INCOME OF NONRESIDENTS, RECIPROCITY.
82.1(a) The compensation received for the performance of personal or professional
82.2services within this state by an individual whose residence, place of abode, and place
82.3customarily returned to at least once a month is in another state, shall be excluded from
82.4gross income to the extent such compensation is subject to an income tax imposed by the
82.5state of residence; provided that such state allows a similar exclusion of compensation
82.6received by residents of Minnesota for services performed therein.
82.7(b) When it is deemed to be in the best interests of the people of this state, the
82.8commissioner may determine that the provisions of paragraph (a) shall not apply. As long
82.9as the provisions of paragraph (a) apply between Minnesota and Wisconsin, the provisions
82.10of paragraph (a) shall apply to any individual who is domiciled in Wisconsin.
82.11(c) For the purposes of paragraph (a), whenever the Wisconsin tax on Minnesota
82.12residents which would have been paid Wisconsin without paragraph (a) exceeds the
82.13Minnesota tax on Wisconsin residents which would have been paid Minnesota without
82.14paragraph (a), or vice versa, then the state with the net revenue loss resulting from
82.15paragraph (a) shall receive from must be compensated by the other state the amount
82.16of such loss as provided in the agreement under paragraph (d). This provision shall be
82.17effective for all years beginning after December 31, 1972. The data used for computing
82.18the loss to either state shall be determined on or before September 30 of the year following
82.19the close of the previous calendar year.
82.20(d) Interest is payable on all amounts calculated under paragraph (c) relating to
82.21taxable years beginning after December 31, 2000. Interest accrues from July 1 of the
82.22taxable year. The commissioner of revenue is authorized to enter into agreements with
82.23the state of Wisconsin specifying the compensation required under paragraph (b), the
82.24reciprocity payment due date, conditions constituting delinquency, interest rates, and a
82.25method for computing interest due. Calculation of compensation under the agreement
82.26must specify if the revenue loss is determined before or after the allowance of each state's
82.27credit for taxes paid to the other state.
82.28(e) If an agreement cannot be reached as to the amount of the loss, the commissioner
82.29of revenue and the taxing official of the state of Wisconsin shall each appoint a member
82.30of a board of arbitration and these members shall appoint the third member of the board.
82.31The board shall select one of its members as chair. Such board may administer oaths, take
82.32testimony, subpoena witnesses, and require their attendance, require the production of
82.33books, papers and documents, and hold hearings at such places as are deemed necessary.
82.34The board shall then make a determination as to the amount to be paid the other state
82.35which determination shall be final and conclusive.
83.1(f) The commissioner may furnish copies of returns, reports, or other information to
83.2the taxing official of the state of Wisconsin, a member of the board of arbitration, or a
83.3consultant under joint contract with the states of Minnesota and Wisconsin for the purpose
83.4of making a determination as to the amount to be paid the other state under the provisions
83.5of this section. Prior to the release of any information under the provisions of this section,
83.6the person to whom the information is to be released shall sign an agreement which
83.7provides that the person will protect the confidentiality of the returns and information
83.8revealed thereby to the extent that it is protected under the laws of the state of Minnesota.

83.9    Sec. 17. Minnesota Statutes 2009 Supplement, section 290.091, subdivision 2, is
83.10amended to read:
83.11    Subd. 2. Definitions. For purposes of the tax imposed by this section, the following
83.12terms have the meanings given:
83.13    (a) "Alternative minimum taxable income" means the sum of the following for
83.14the taxable year:
83.15    (1) the taxpayer's federal alternative minimum taxable income as defined in section
83.1655(b)(2) of the Internal Revenue Code;
83.17    (2) the taxpayer's itemized deductions allowed in computing federal alternative
83.18minimum taxable income, but excluding:
83.19    (i) the charitable contribution deduction under section 170 of the Internal Revenue
83.20Code;
83.21    (ii) the medical expense deduction;
83.22    (iii) the casualty, theft, and disaster loss deduction; and
83.23    (iv) the impairment-related work expenses of a disabled person;
83.24    (3) for depletion allowances computed under section 613A(c) of the Internal
83.25Revenue Code, with respect to each property (as defined in section 614 of the Internal
83.26Revenue Code), to the extent not included in federal alternative minimum taxable income,
83.27the excess of the deduction for depletion allowable under section 611 of the Internal
83.28Revenue Code for the taxable year over the adjusted basis of the property at the end of the
83.29taxable year (determined without regard to the depletion deduction for the taxable year);
83.30    (4) to the extent not included in federal alternative minimum taxable income, the
83.31amount of the tax preference for intangible drilling cost under section 57(a)(2) of the
83.32Internal Revenue Code determined without regard to subparagraph (E);
83.33    (5) to the extent not included in federal alternative minimum taxable income, the
83.34amount of interest income as provided by section 290.01, subdivision 19a, clause (1); and
84.1    (6) the amount of addition required by section 290.01, subdivision 19a, clauses (7)
84.2to (9), (12), (13), (16), and (17);
84.3    less the sum of the amounts determined under the following:
84.4    (1) interest income as defined in section 290.01, subdivision 19b, clause (1);
84.5    (2) an overpayment of state income tax as provided by section 290.01, subdivision
84.619b , clause (2), to the extent included in federal alternative minimum taxable income;
84.7    (3) the amount of investment interest paid or accrued within the taxable year on
84.8indebtedness to the extent that the amount does not exceed net investment income, as
84.9defined in section 163(d)(4) of the Internal Revenue Code. Interest does not include
84.10amounts deducted in computing federal adjusted gross income; and
84.11    (4) amounts subtracted from federal taxable income as provided by section 290.01,
84.12subdivision 19b , clauses (6), (9) (8) to (16) (15), and (18) (17).
84.13    In the case of an estate or trust, alternative minimum taxable income must be
84.14computed as provided in section 59(c) of the Internal Revenue Code.
84.15    (b) "Investment interest" means investment interest as defined in section 163(d)(3)
84.16of the Internal Revenue Code.
84.17    (c) "Net minimum tax" means the minimum tax imposed by this section.
84.18    (d) "Regular tax" means the tax that would be imposed under this chapter (without
84.19regard to this section and section 290.032), reduced by the sum of the nonrefundable
84.20credits allowed under this chapter.
84.21    (e) "Tentative minimum tax" equals 6.4 percent of alternative minimum taxable
84.22income after subtracting the exemption amount determined under subdivision 3.
84.23EFFECTIVE DATE.This section is effective the day following final enactment.

84.24    Sec. 18. Minnesota Statutes 2008, section 290.0921, subdivision 3, is amended to read:
84.25    Subd. 3. Alternative minimum taxable income. "Alternative minimum taxable
84.26income" is Minnesota net income as defined in section 290.01, subdivision 19, and
84.27includes the adjustments and tax preference items in sections 56, 57, 58, and 59(d), (e),
84.28(f), and (h) of the Internal Revenue Code. If a corporation files a separate company
84.29Minnesota tax return, the minimum tax must be computed on a separate company basis.
84.30If a corporation is part of a tax group filing a unitary return, the minimum tax must be
84.31computed on a unitary basis. The following adjustments must be made.
84.32(1) For purposes of the depreciation adjustments under section 56(a)(1) and
84.3356(g)(4)(A) of the Internal Revenue Code, the basis for depreciable property placed in
84.34service in a taxable year beginning before January 1, 1990, is the adjusted basis for federal
84.35income tax purposes, including any modification made in a taxable year under section
85.1290.01, subdivision 19e , or Minnesota Statutes 1986, section 290.09, subdivision 7,
85.2paragraph (c).
85.3For taxable years beginning after December 31, 2000, the amount of any remaining
85.4modification made under section 290.01, subdivision 19e, or Minnesota Statutes 1986,
85.5section 290.09, subdivision 7, paragraph (c), not previously deducted is a depreciation
85.6allowance in the first taxable year after December 31, 2000.
85.7(2) The portion of the depreciation deduction allowed for federal income tax
85.8purposes under section 168(k) of the Internal Revenue Code that is required as an
85.9addition under section 290.01, subdivision 19c, clause (15), is disallowed in determining
85.10alternative minimum taxable income.
85.11(3) The subtraction for depreciation allowed under section 290.01, subdivision
85.1219d , clause (18) (17), is allowed as a depreciation deduction in determining alternative
85.13minimum taxable income.
85.14(4) The alternative tax net operating loss deduction under sections 56(a)(4) and 56(d)
85.15of the Internal Revenue Code does not apply.
85.16(5) The special rule for certain dividends under section 56(g)(4)(C)(ii) of the Internal
85.17Revenue Code does not apply.
85.18(6) The special rule for dividends from section 936 companies under section
85.1956(g)(4)(C)(iii) does not apply.
85.20(7) The tax preference for depletion under section 57(a)(1) of the Internal Revenue
85.21Code does not apply.
85.22(8) The tax preference for intangible drilling costs under section 57(a)(2) of the
85.23Internal Revenue Code must be calculated without regard to subparagraph (E) and the
85.24subtraction under section 290.01, subdivision 19d, clause (4).
85.25(9) The tax preference for tax exempt interest under section 57(a)(5) of the Internal
85.26Revenue Code does not apply.
85.27(10) The tax preference for charitable contributions of appreciated property under
85.28section 57(a)(6) of the Internal Revenue Code does not apply.
85.29(11) For purposes of calculating the tax preference for accelerated depreciation or
85.30amortization on certain property placed in service before January 1, 1987, under section
85.3157(a)(7) of the Internal Revenue Code, the deduction allowable for the taxable year is the
85.32deduction allowed under section 290.01, subdivision 19e.
85.33For taxable years beginning after December 31, 2000, the amount of any remaining
85.34modification made under section 290.01, subdivision 19e, not previously deducted is a
85.35depreciation or amortization allowance in the first taxable year after December 31, 2004.
86.1(12) For purposes of calculating the adjustment for adjusted current earnings in
86.2section 56(g) of the Internal Revenue Code, the term "alternative minimum taxable
86.3income" as it is used in section 56(g) of the Internal Revenue Code, means alternative
86.4minimum taxable income as defined in this subdivision, determined without regard to the
86.5adjustment for adjusted current earnings in section 56(g) of the Internal Revenue Code.
86.6(13) For purposes of determining the amount of adjusted current earnings under
86.7section 56(g)(3) of the Internal Revenue Code, no adjustment shall be made under section
86.856(g)(4) of the Internal Revenue Code with respect to (i) the amount of foreign dividend
86.9gross-up subtracted as provided in section 290.01, subdivision 19d, clause (1), (ii) the
86.10amount of refunds of income, excise, or franchise taxes subtracted as provided in section
86.11290.01, subdivision 19d , clause (9), or (iii) the amount of royalties, fees or other like
86.12income subtracted as provided in section 290.01, subdivision 19d, clause (10).
86.13(14) Alternative minimum taxable income excludes the income from operating in a
86.14job opportunity building zone as provided under section 469.317.
86.15(15) Alternative minimum taxable income excludes the income from operating in a
86.16biotechnology and health sciences industry zone as provided under section 469.337.
86.17(16) Alternative minimum taxable income excludes the income from operating in an
86.18international economic development zone as provided under section 469.326.
86.19Items of tax preference must not be reduced below zero as a result of the
86.20modifications in this subdivision.
86.21EFFECTIVE DATE.This section is effective the day following final enactment.

86.22    Sec. 19. Minnesota Statutes 2008, section 290.17, subdivision 2, is amended to read:
86.23    Subd. 2. Income not derived from conduct of a trade or business. The income of
86.24a taxpayer subject to the allocation rules that is not derived from the conduct of a trade or
86.25business must be assigned in accordance with paragraphs (a) to (f):
86.26    (a)(1) Subject to paragraphs (a)(2) and (a)(3), income from wages as defined in
86.27section 3401(a) and (f) of the Internal Revenue Code is assigned to this state if, and to the
86.28extent that, the work of the employee is performed within it; all other income from such
86.29sources is treated as income from sources without this state.
86.30    Severance pay shall be considered income from labor or personal or professional
86.31services.
86.32    (2) In the case of an individual who is a nonresident of Minnesota and who is an
86.33athlete or entertainer, income from compensation for labor or personal services performed
86.34within this state shall be determined in the following manner:
87.1    (i) The amount of income to be assigned to Minnesota for an individual who is a
87.2nonresident salaried athletic team employee shall be determined by using a fraction in
87.3which the denominator contains the total number of days in which the individual is under
87.4a duty to perform for the employer, and the numerator is the total number of those days
87.5spent in Minnesota. For purposes of this paragraph, off-season training activities, unless
87.6conducted at the team's facilities as part of a team imposed program, are not included in
87.7the total number of duty days. Bonuses earned as a result of play during the regular season
87.8or for participation in championship, play-off, or all-star games must be allocated under
87.9the formula. Signing bonuses are not subject to allocation under the formula if they are
87.10not conditional on playing any games for the team, are payable separately from any other
87.11compensation, and are nonrefundable; and
87.12    (ii) The amount of income to be assigned to Minnesota for an individual who is a
87.13nonresident, and who is an athlete or entertainer not listed in clause (i), for that person's
87.14athletic or entertainment performance in Minnesota shall be determined by assigning to
87.15this state all income from performances or athletic contests in this state.
87.16    (3) For purposes of this section, amounts received by a nonresident as "retirement
87.17income" as defined in section (b)(1) of the State Income Taxation of Pension Income
87.18Act, Public Law 104-95, are not considered income derived from carrying on a trade
87.19or business or from wages or other compensation for work an employee performed in
87.20Minnesota, and are not taxable under this chapter.
87.21    (b) Income or gains from tangible property located in this state that is not employed
87.22in the business of the recipient of the income or gains must be assigned to this state.
87.23    (c) Income or gains from intangible personal property not employed in the business
87.24of the recipient of the income or gains must be assigned to this state if the recipient of the
87.25income or gains is a resident of this state or is a resident trust or estate.
87.26    Gain on the sale of a partnership interest is allocable to this state in the ratio of the
87.27original cost of partnership tangible property in this state to the original cost of partnership
87.28tangible property everywhere, determined at the time of the sale. If more than 50 percent
87.29of the value of the partnership's assets consists of intangibles, gain or loss from the sale
87.30of the partnership interest is allocated to this state in accordance with the sales factor of
87.31the partnership for its first full tax period immediately preceding the tax period of the
87.32partnership during which the partnership interest was sold.
87.33Gain on the sale of an interest in a single member limited liability company that
87.34is disregarded for federal income tax purposes is allocable to this state as if the single
87.35member limited liability company did not exist and the assets of the limited liability
87.36company are personally owned by the sole member.
88.1    Gain on the sale of goodwill or income from a covenant not to compete that is
88.2connected with a business operating all or partially in Minnesota is allocated to this state
88.3to the extent that the income from the business in the year preceding the year of sale was
88.4assignable to Minnesota under subdivision 3.
88.5    When an employer pays an employee for a covenant not to compete, the income
88.6allocated to this state is in the ratio of the employee's service in Minnesota in the calendar
88.7year preceding leaving the employment of the employer over the total services performed
88.8by the employee for the employer in that year.
88.9    (d) Income from winnings on a bet made by an individual while in Minnesota is
88.10assigned to this state. In this paragraph, "bet" has the meaning given in section 609.75,
88.11subdivision 2 , as limited by section 609.75, subdivision 3, clauses (1), (2), and (3).
88.12    (e) All items of gross income not covered in paragraphs (a) to (d) and not part of the
88.13taxpayer's income from a trade or business shall be assigned to the taxpayer's domicile.
88.14    (f) For the purposes of this section, working as an employee shall not be considered
88.15to be conducting a trade or business.
88.16EFFECTIVE DATE.This section is effective the day following final enactment.

88.17    Sec. 20. Minnesota Statutes 2008, section 290.21, subdivision 4, is amended to read:
88.18    Subd. 4. Dividends received from another corporation. (a)(1) Eighty percent
88.19of dividends received by a corporation during the taxable year from another corporation,
88.20in which the recipient owns 20 percent or more of the stock, by vote and value, not
88.21including stock described in section 1504(a)(4) of the Internal Revenue Code when the
88.22corporate stock with respect to which dividends are paid does not constitute the stock in
88.23trade of the taxpayer or would not be included in the inventory of the taxpayer, or does not
88.24constitute property held by the taxpayer primarily for sale to customers in the ordinary
88.25course of the taxpayer's trade or business, or when the trade or business of the taxpayer
88.26does not consist principally of the holding of the stocks and the collection of the income
88.27and gains therefrom; and
88.28    (2)(i) the remaining 20 percent of dividends if the dividends received are the stock in
88.29an affiliated company transferred in an overall plan of reorganization and the dividend
88.30is eliminated in consolidation under Treasury Department Regulation 1.1502-14(a), as
88.31amended through December 31, 1989;
88.32    (ii) the remaining 20 percent of dividends if the dividends are received from a
88.33corporation which is subject to tax under section 290.36 and which is a member of an
88.34affiliated group of corporations as defined by the Internal Revenue Code and the dividend
88.35is eliminated in consolidation under Treasury Department Regulation 1.1502-14(a), as
89.1amended through December 31, 1989, or is deducted under an election under section
89.2243(b) of the Internal Revenue Code; or
89.3    (iii) the remaining 20 percent of the dividends if the dividends are received from a
89.4property and casualty insurer as defined under section 60A.60, subdivision 8, which is a
89.5member of an affiliated group of corporations as defined by the Internal Revenue Code
89.6and either: (A) the dividend is eliminated in consolidation under Treasury Regulation
89.71.1502-14(a), as amended through December 31, 1989; or (B) the dividend is deducted
89.8under an election under section 243(b) of the Internal Revenue Code.
89.9    (b) Seventy percent of dividends received by a corporation during the taxable year
89.10from another corporation in which the recipient owns less than 20 percent of the stock,
89.11by vote or value, not including stock described in section 1504(a)(4) of the Internal
89.12Revenue Code when the corporate stock with respect to which dividends are paid does not
89.13constitute the stock in trade of the taxpayer, or does not constitute property held by the
89.14taxpayer primarily for sale to customers in the ordinary course of the taxpayer's trade or
89.15business, or when the trade or business of the taxpayer does not consist principally of the
89.16holding of the stocks and the collection of income and gain therefrom.
89.17    (c) The dividend deduction provided in this subdivision shall be allowed only with
89.18respect to dividends that are included in a corporation's Minnesota taxable net income
89.19for the taxable year.
89.20    The dividend deduction provided in this subdivision does not apply to a dividend
89.21from a corporation which, for the taxable year of the corporation in which the distribution
89.22is made or for the next preceding taxable year of the corporation, is a corporation exempt
89.23from tax under section 501 of the Internal Revenue Code.
89.24    The dividend deduction provided in this subdivision applies to the amount of
89.25regulated investment company dividends only to the extent determined under section
89.26854(b) of the Internal Revenue Code.
89.27    The dividend deduction provided in this subdivision shall not be allowed with
89.28respect to any dividend for which a deduction is not allowed under the provisions of
89.29section 246(c) of the Internal Revenue Code.
89.30    (d) If dividends received by a corporation that does not have nexus with Minnesota
89.31under the provisions of Public Law 86-272 are included as income on the return of
89.32an affiliated corporation permitted or required to file a combined report under section
89.33290.17, subdivision 4 , or 290.34, subdivision 2, then for purposes of this subdivision the
89.34determination as to whether the trade or business of the corporation consists principally
89.35of the holding of stocks and the collection of income and gains therefrom shall be made
90.1with reference to the trade or business of the affiliated corporation having a nexus with
90.2Minnesota.
90.3    (e) The deduction provided by this subdivision does not apply if the dividends are
90.4paid by a FSC as defined in section 922 of the Internal Revenue Code.
90.5    (f) If one or more of the members of the unitary group whose income is included on
90.6the combined report received a dividend, the deduction under this subdivision for each
90.7member of the unitary business required to file a return under this chapter is the product
90.8of: (1) 100 percent of the dividends received by members of the group; (2) the percentage
90.9allowed pursuant to paragraph (a) or (b); and (3) the percentage of the taxpayer's business
90.10income apportionable to this state for the taxable year under section 290.191 or 290.20.
90.11(g) The deduction provided by this subdivision does not apply to dividends received
90.12from a real estate investment trust, if the dividends are not considered to be dividends
90.13under sections 243(d)(3) and 857(c) of the Internal Revenue Code.
90.14EFFECTIVE DATE.This section is effective for taxable years beginning after
90.15December 31, 2010.

90.16    Sec. 21. Minnesota Statutes 2009 Supplement, section 291.005, subdivision 1, as
90.17amended by Laws 2010, chapter 216, section 15, is amended to read:
90.18    Subdivision 1. Scope. Unless the context otherwise clearly requires, the following
90.19terms used in this chapter shall have the following meanings:
90.20    (1) "Commissioner" means the commissioner of revenue or any person to whom the
90.21commissioner has delegated functions under this chapter.
90.22    (2) "Federal gross estate" means the gross estate of a decedent as required to
90.23be valued and otherwise determined for federal estate tax purposes by federal taxing
90.24authorities pursuant to the provisions of under the Internal Revenue Code.
90.25    (3) "Internal Revenue Code" means the United States Internal Revenue Code of
90.261986, as amended through March 18, 2010, but without regard to the provisions of
90.27sections 501 and 901 of Public Law 107-16.
90.28    (4) "Minnesota adjusted taxable estate" means federal adjusted taxable estate as
90.29defined by section 2011(b)(3) of the Internal Revenue Code, increased by the amount of
90.30deduction for state death taxes allowed under section 2058 of the Internal Revenue Code.
90.31    (5) "Minnesota gross estate" means the federal gross estate of a decedent after (a)
90.32excluding therefrom any property included therein which has its situs outside Minnesota,
90.33and (b) including therein any property omitted from the federal gross estate which is
90.34includable therein, has its situs in Minnesota, and was not disclosed to federal taxing
90.35authorities.
91.1    (6) "Nonresident decedent" means an individual whose domicile at the time of
91.2death was not in Minnesota.
91.3    (7) "Personal representative" means the executor, administrator or other person
91.4appointed by the court to administer and dispose of the property of the decedent. If there
91.5is no executor, administrator or other person appointed, qualified, and acting within this
91.6state, then any person in actual or constructive possession of any property having a situs in
91.7this state which is included in the federal gross estate of the decedent shall be deemed
91.8to be a personal representative to the extent of the property and the Minnesota estate tax
91.9due with respect to the property.
91.10    (8) "Resident decedent" means an individual whose domicile at the time of death
91.11was in Minnesota.
91.12    (9) "Situs of property" means, with respect to real property, the state or country in
91.13which it is located; with respect to tangible personal property, the state or country in which
91.14it was normally kept or located at the time of the decedent's death; and with respect to
91.15intangible personal property, the state or country in which the decedent was domiciled
91.16at death.
91.17EFFECTIVE DATE.This section is effective the day following final enactment
91.18and applies regardless of when the decedent died.

91.19    Sec. 22. Minnesota Statutes 2008, section 291.03, is amended by adding a subdivision
91.20to read:
91.21    Subd. 1b. Qualified terminable interest property. For estates of decedents dying
91.22after December 31, 2009, and before January 1, 2011, if no federal estate tax return is
91.23filed the executor may make a qualified terminable interest property election, as defined
91.24in section 2056(b)(7) of the Internal Revenue Code, for purposes of computing the tax
91.25under this chapter. The election may not reduce the taxable estate under this chapter
91.26below $3,500,000. The election must be made on the tax return under this chapter and is
91.27irrevocable. All tax under this chapter must be determined using the qualified terminable
91.28interest property election made on the Minnesota return. For purposes of applying
91.29sections 2044 and 2207A of the Internal Revenue Code when computing the tax under
91.30this chapter for the estate of the decedent's surviving spouse, regardless of the date of
91.31death of the surviving spouse, amounts for which a qualified terminable interest property
91.32election has been made under this section must be treated as though a valid federal
91.33qualified terminable interest property election under section 2056(b)(7) of the Internal
91.34Revenue Code has been made.
92.1EFFECTIVE DATE.This section is effective for estates of decedents dying after
92.2December 31, 2009.

92.3    Sec. 23. [524.2-712] DECEDENTS DYING AFTER DECEMBER 31, 2009,
92.4AND BEFORE JANUARY 1, 2011; CONSTRUCTION OF CERTAIN FORMULA
92.5CLAUSES BY REFERENCE TO FEDERAL TRANSFER TAX LAW.
92.6(a) A governing instrument, including a will or trust agreement, of a decedent who
92.7dies after December 31, 2009, and before January 1, 2011, that contains a formula or
92.8provision referring to the "unified credit," "estate tax exemption," "applicable exemption
92.9amount," "applicable credit amount," "applicable exclusion amount," "generation-skipping
92.10transfer tax exemption," "GST exemption," "marital deduction," "maximum marital
92.11deduction," "unlimited marital deduction," "inclusion ratio," "applicable fraction," or
92.12any section of the Internal Revenue Code relating to the federal estate tax or federal
92.13generation-skipping transfer tax, or that measures a share of an estate or trust by reference
92.14to federal estate taxes or federal generation-skipping transfer taxes, is deemed to refer to
92.15the federal estate tax and the federal generation-skipping transfer tax laws as they applied
92.16with respect to the estates of decedents dying on December 31, 2009. This paragraph does
92.17not apply to a governing instrument, including a will or trust agreement, that manifests
92.18an intent that a contrary rule applies if the decedent dies on a date on which there is no
92.19then-applicable federal estate or federal generation-skipping transfer tax.
92.20(b) If the federal estate or federal generation-skipping transfer tax becomes effective
92.21before January 1, 2011, then the reference to January 1, 2011, in paragraph (a) instead
92.22refers to the first date on which the tax becomes legally effective.
92.23(c) The personal representative, trustee, or any interested person under the governing
92.24instrument, including a will or trust agreement, may bring a proceeding to determine
92.25whether the decedent intended that a formula or provision described in paragraph (a) be
92.26construed with respect to the law as it existed after December 31, 2009. Such a proceeding
92.27must be commenced by December 31, 2011.
92.28EFFECTIVE DATE.This section is effective on January 1, 2010.

92.29    Sec. 24. INCOME TAX RECIPROCITY BENCHMARK STUDY.
92.30    Subdivision 1. Study parameters. (a) The Department of Revenue, in conjunction
92.31with the Wisconsin Department of Revenue, must conduct a study of individuals
92.32who are residents of Minnesota and earn income for the performance of personal or
92.33professional services in Wisconsin, or who are residents of Wisconsin and earn income
93.1for the performance of personal or professional services in Minnesota. The purpose of
93.2the study is to develop an estimate of net compensation payable from one state to the
93.3other for the income tax revenue foregone as a result of the two states entering into a
93.4new income tax reciprocity agreement, which would take effect in tax year 2012, with
93.5compensation payments from one state to the other made in the same fiscal year in which
93.6the net revenue loss resulting from reciprocity occurs. The study must be conducted as
93.7soon as practicable, using information obtained from each state's income tax returns for
93.8tax year 2010, and from any other source of information the departments determine is
93.9necessary to complete the study.
93.10(b) The study must include at least the following:
93.11(1) the number of residents of each state who earn income from the performance of
93.12personal or professional services in the other state;
93.13(2) the total amount of income earned by residents of each state who earn income
93.14from the performance of personal or professional services in the other state;
93.15(3) the amount of tax revenue that would be gained or foregone by each state if an
93.16income tax reciprocity agreement were resumed between the two states under which the
93.17taxpayers were required to pay income taxes on the income only in their state of residence
93.18beginning in tax year 2012;
93.19(4) a calculation of compensation payable from one state to the other that takes into
93.20account the credit each state allows for taxes paid to other states; and
93.21(5) a methodology for using the base year results determined by the study to project
93.22the amount of compensation payments in future years.
93.23    Subd. 2. Reports. (a) No later than July 15, 2011, the commissioner of revenue
93.24must report to the governor and to the chairs and ranking minority members of the
93.25legislative committees having jurisdiction over taxes, in compliance with Minnesota
93.26Statutes, sections 3.195 and 3.197. The report must include:
93.27(1) the status of negotiations between the states concerning a reciprocity agreement
93.28to commence for tax year 2012;
93.29(2) a description of data elements being captured for the study from 2010 income
93.30tax returns;
93.31(3) preliminary totals for the number of residents of each state who earn income
93.32from the performance of personal or professional services in the other state and the
93.33amount of that income; and
93.34(4) any other preliminary conclusions responsive to the requirements in subdivision
93.351.
94.1(b) No later than September 15, 2011, the commissioner of revenue must report to
94.2the governor and to the chairs and ranking minority members of the legislative committees
94.3having jurisdiction over taxes in compliance with Minnesota Statutes, sections 3.195 and
94.43.197. The report must include an update of information provided in paragraph (a).
94.5(c) No later than March 1, 2012, the commissioner of revenue must submit a final
94.6report to the governor and to the chairs and ranking minority members of the legislative
94.7committees having jurisdiction over taxes, in compliance with Minnesota Statutes,
94.8sections 3.195 and 3.197, on the final results of the study and the status of a reciprocity
94.9agreement between the two states.


94.12    Section 1. Minnesota Statutes 2008, section 289A.50, subdivision 2, is amended to
94.13read:
94.14    Subd. 2. Refund of sales tax to vendors; limitation. (a) If a vendor has collected
94.15from a purchaser and remitted to the state a tax on a transaction that is not subject to the
94.16tax imposed by chapter 297A, the tax is refundable to the vendor only if and to the extent
94.17that the tax and any interest earned on the tax is credited to amounts due to the vendor by
94.18the purchaser or returned to the purchaser by the vendor.
94.19(b) In addition to the requirements of subdivision 1, a claim for refund under this
94.20subdivision must state in writing that the tax and interest earned on the tax has been or
94.21will be refunded or credited to the purchaser by the vendor.
94.22(c) Within 60 days after the date the commissioner issues the refund, any amount not
94.23refunded or credited to the purchaser by the vendor, as required by paragraph (a), must be
94.24returned to the commissioner by the vendor.
94.25(d) After the commissioner refunds the tax and interest to the vendor, if the
94.26commissioner determines that the vendor did not refund or credit the tax and interest as
94.27provided in this subdivision, or did not return the amount required to be returned under
94.28paragraph (c), the commissioner may assess the vendor for underpayment of tax and
94.29interest equal to that portion of the amount that was not refunded or credited to the
94.30purchaser. The assessment bears interest which is computed at the rate specified in section
94.31270C.40, subdivision 5, on the unpaid amount from the date the commissioner issues the
94.32refund until the date the amount is paid to the commissioner. The assessment may be made
94.33at any time within 3-1/2 years after the commissioner refunds the tax and interest to the
94.34vendor. If part of the refund was induced by fraud or misrepresentation of a material fact,
94.35the assessment may be made at any time.
95.1EFFECTIVE DATE.This section is effective for refunds issued after June 30, 2010.

95.2    Sec. 2. Minnesota Statutes 2008, section 297A.62, as amended by Laws 2009, chapter
95.388, article 4, section 4, is amended to read:
95.4297A.62 SALES TAX IMPOSED; RATES.
95.5    Subdivision 1. Generally. Except as otherwise provided in subdivision 3 or in this
95.6chapter, a sales tax of 6.5 percent is imposed on the gross receipts from retail sales as
95.7defined in section 297A.61, subdivision 4, made in this state or to a destination in this
95.8state by a person who is required to have or voluntarily obtains a permit under section
95.9297A.83, subdivision 1 .
95.10    Subd. 1a. Constitutionally required sales tax increase. Except as otherwise
95.11provided in subdivision 3 or in this chapter, an additional sales tax of 0.375 percent, as
95.12required under the Minnesota Constitution, article XI, section 15, is imposed on the gross
95.13receipts from retail sales as defined in section 297A.61, subdivision 4, made in this state or
95.14to a destination in this state by a person who is required to have or voluntarily obtains a
95.15permit under section 297A.83, subdivision 1. This additional tax expires July 1, 2034.
95.16    Subd. 3. Manufactured housing and park trailers. For retail sales of
95.17manufactured homes as defined in section 327.31, subdivision 6, for residential uses, the
95.18sales tax under subdivision subdivisions 1 and 1a is imposed on 65 percent of the dealer's
95.19cost of the manufactured home. For retail sales of new or used park trailers, as defined in
95.20section 168.002, subdivision 23, the sales tax under subdivision subdivisions 1 and 1a is
95.21imposed on 65 percent of the sales price of the park trailer.
95.22    Subd. 4. Combined rates. In this chapter, wherever there is a reference to the rate
95.23under subdivision 1, or to a combined rate under subdivisions 1 and 1a, the rate to be
95.24applied is the combined rate under subdivisions 1 and 1a until the additional tax imposed
95.25by subdivision 1a expires. This subdivision does not apply to section 297A.65.
95.26EFFECTIVE DATE.This section is effective retroactively for sales and purchases
95.27made after June 30, 2009, except for sales and purchases subject to subdivision 3. This
95.28section is effective for sales and purchases subject to subdivision 3 made after June 30,
95.292010.

95.30    Sec. 3. Minnesota Statutes 2008, section 297A.665, is amended to read:
95.31297A.665 PRESUMPTION OF TAX; BURDEN OF PROOF.
95.32    (a) For the purpose of the proper administration of this chapter and to prevent
95.33evasion of the tax, until the contrary is established, it is presumed that:
96.1    (1) all gross receipts are subject to the tax; and
96.2    (2) all retail sales for delivery in Minnesota are for storage, use, or other consumption
96.3in Minnesota.
96.4    (b) The burden of proving that a sale is not a taxable retail sale is on the seller.
96.5However, a seller is relieved of liability if:
96.6    (1) the seller obtains a fully completed exemption certificate or all the relevant
96.7information required by section 297A.72, subdivision 2, at the time of the sale or within
96.890 days after the date of the sale; or
96.9    (2) if the seller has not obtained a fully completed exemption certificate or all the
96.10relevant information required by section 297A.72, subdivision 2, within the time provided
96.11in clause (1), within 120 days after a request for substantiation by the commissioner,
96.12the seller either:
96.13    (i) obtains in good faith a fully completed exemption certificate or all the relevant
96.14information required by section 297A.72, subdivision 2, from the purchaser; or
96.15    (ii) proves by other means that the transaction was not subject to tax.
96.16    (c) Notwithstanding paragraph (b), relief from liability does not apply to a seller who:
96.17    (1) fraudulently fails to collect the tax; or
96.18    (2) solicits purchasers to participate in the unlawful claim of an exemption.
96.19    (d) A certified service provider, as defined in section 297A.995, subdivision 2, is
96.20relieved of liability under this section to the extent a seller who is its client is relieved of
96.21liability.
96.22    (e) A purchaser of tangible personal property or any items listed in section 297A.63
96.23that are shipped or brought to Minnesota by the purchaser has the burden of proving
96.24that the property was not purchased from a retailer for storage, use, or consumption in
96.25Minnesota.
96.26(f) If a seller claiming that certain sales are exempt and does not provide the
96.27certificate, information, or proof required by paragraph (b), clause (2), within 120 days
96.28after the date of the commissioner's request for substantiation, then the exemptions
96.29claimed by the seller that required substantiation are disallowed.
96.30EFFECTIVE DATE.This section is effective the day following final enactment.

96.31    Sec. 4. Minnesota Statutes 2008, section 297A.68, subdivision 39, is amended to read:
96.32    Subd. 39. Preexisting bids or contracts. (a) The sale of tangible personal property
96.33or services is exempt from tax or a tax rate increase for a period of six months from
96.34the effective date of the law change that results in the imposition of the tax or the tax
96.35rate increase under this chapter if:
97.1(1) the act imposing the tax or increasing the tax rate does not have transitional
97.2effective date language for existing construction contracts and construction bids; and
97.3(2) the requirements of paragraph (b) are met.
97.4(b) A sale is tax exempt under paragraph (a) if it meets the requirements of either
97.5clause (1) or (2):
97.6(1) For a construction contract:
97.7(i) the goods or services sold must be used for the performance of a bona fide written
97.8lump sum or fixed price construction contract;
97.9(ii) the contract must be entered into before the date the goods or services become
97.10subject to the sales tax or the tax rate was increased;
97.11(iii) the contract must not provide for allocation of future taxes; and
97.12(iv) for each qualifying contract the contractor must give the seller keep
97.13documentation of the contract on which an exemption is to be claimed.
97.14(2) For a construction bid:
97.15(i) the goods or services sold must be used pursuant to an obligation of a bid or bids;
97.16(ii) the bid or bids must be submitted and accepted before the date the goods or
97.17services became subject to the sales tax or the tax rate was increased;
97.18(iii) the bid or bids must not be able to be withdrawn, modified, or changed without
97.19forfeiting a bond; and
97.20(iv) for each qualifying bid, the contractor must give the seller keep documentation
97.21of the bid on which an exemption is to be claimed.
97.22EFFECTIVE DATE.This section is effective the day following final enactment.

97.23    Sec. 5. Minnesota Statutes 2008, section 297A.70, subdivision 13, is amended to read:
97.24    Subd. 13. Fund-raising sales by or for nonprofit groups. (a) The following
97.25sales by the specified organizations for fund-raising purposes are exempt, subject to the
97.26limitations listed in paragraph (b):
97.27(1) all sales made by an a nonprofit organization that exists solely for the purpose of
97.28providing educational or social activities for young people primarily age 18 and under;
97.29(2) all sales made by an organization that is a senior citizen group or association of
97.30groups if (i) in general it limits membership to persons age 55 or older; (ii) it is organized
97.31and operated exclusively for pleasure, recreation, and other nonprofit purposes; and (iii)
97.32no part of its net earnings inures to the benefit of any private shareholders;
97.33(3) the sale or use of tickets or admissions to a golf tournament held in Minnesota if
97.34the beneficiary of the tournament's net proceeds qualifies as a tax-exempt organization
97.35under section 501(c)(3) of the Internal Revenue Code; and
98.1(4) sales of candy sold for fund-raising purposes by a nonprofit organization that
98.2provides educational and social activities primarily for young people age 18 and under.
98.3(b) The exemptions listed in paragraph (a) are limited in the following manner:
98.4(1) the exemption under paragraph (a), clauses (1) and (2), applies only if the gross
98.5annual receipts of the organization from fund-raising do not exceed $10,000; and
98.6(2) the exemption under paragraph (a), clause (1), does not apply if the sales are
98.7derived from admission charges or from activities for which the money must be deposited
98.8with the school district treasurer under section 123B.49, subdivision 2, or be recorded in
98.9the same manner as other revenues or expenditures of the school district under section
98.10123B.49, subdivision 4 .
98.11(c) Sales of tangible personal property are exempt if the entire proceeds, less the
98.12necessary expenses for obtaining the property, will be contributed to a registered combined
98.13charitable organization described in section 43A.50, to be used exclusively for charitable,
98.14religious, or educational purposes, and the registered combined charitable organization
98.15has given its written permission for the sale. Sales that occur over a period of more than
98.1624 days per year are not exempt under this paragraph.
98.17(d) For purposes of this subdivision, a club, association, or other organization of
98.18elementary or secondary school students organized for the purpose of carrying on sports,
98.19educational, or other extracurricular activities is a separate organization from the school
98.20district or school for purposes of applying the $10,000 limit.
98.21EFFECTIVE DATE.This section is effective the day following final enactment.

98.22    Sec. 6. Minnesota Statutes 2008, section 297A.71, subdivision 23, is amended to read:
98.23    Subd. 23. Construction materials for qualified low-income housing projects. (a)
98.24Purchases of materials and supplies used or consumed in and equipment incorporated into
98.25the construction, improvement, or expansion of qualified low-income housing projects are
98.26exempt from the tax imposed under this chapter if the owner of the qualified low-income
98.27housing project is:
98.28    (1) the public housing agency or housing and redevelopment authority of a political
98.29subdivision;
98.30    (2) an entity exercising the powers of a housing and redevelopment authority within
98.31a political subdivision;
98.32    (3) a limited partnership in which the sole or managing general partner is an
98.33authority under clause (1) or an entity under clause (2) or, (4), or (5);
98.34    (4) a nonprofit corporation subject to the provisions of chapter 317A, and qualifying
98.35under section 501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986, as amended; or
99.1(5) a limited liability company that consists of a sole member that is an entity under
99.2clause (4); or
99.3    (5) (6) an owner entity, as defined in Code of Federal Regulations, title 24, part
99.4941.604, for a qualified low-income housing project described in paragraph (b), clause (5).
99.5    This exemption applies regardless of whether the purchases are made by the owner
99.6of the facility or a contractor.
99.7    (b) For purposes of this exemption, "qualified low-income housing project" means:
99.8    (1) a housing or mixed use project in which at least 20 percent of the residential units
99.9are qualifying low-income rental housing units as defined in section 273.126;
99.10    (2) a federally assisted low-income housing project financed by a mortgage insured
99.11or held by the United States Department of Housing and Urban Development under
99.12United States Code, title 12, section 1701s, 1715l(d)(3), 1715l(d)(4), or 1715z-1; United
99.13States Code, title 42, section 1437f; the Native American Housing Assistance and
99.14Self-Determination Act, United States Code, title 25, section 4101 et seq.; or any similar
99.15successor federal low-income housing program;
99.16    (3) a qualified low-income housing project as defined in United States Code, title
99.1726, section 42(g), meeting all of the requirements for a low-income housing credit under
99.18section 42 of the Internal Revenue Code regardless of whether the project actually applies
99.19for or receives a low-income housing credit;
99.20    (4) a project that will be operated in compliance with Internal Revenue Service
99.21revenue procedure 96-32; or
99.22    (5) a housing or mixed use project in which all or a portion of the residential units
99.23are subject to the requirements of section 5 of the United States Housing Act of 1937.
99.24    (c) For a project, a portion of which is not used for low-income housing units,
99.25the amount of purchases that are exempt under this subdivision must be determined by
99.26multiplying the total purchases, as specified in paragraph (a), by the ratio of:
99.27    (1) the total gross square footage of units subject to the income limits under section
99.28273.126 , the financing for the project, the federal low-income housing tax credit, revenue
99.29procedure 96-32, or section 5 of the United States Housing Act of 1937, as applicable
99.30to the project; and
99.31    (2) the total gross square footage of all units in the project.
99.32    (d) The tax must be imposed and collected as if the rate under section 297A.62,
99.33subdivision 1 , applied, and then refunded in the manner provided in section 297A.75.
99.34EFFECTIVE DATE.This section is effective for sales and purchases made after
99.35June 30, 2010.

100.1    Sec. 7. Minnesota Statutes 2008, section 297A.995, subdivision 10, is amended to read:
100.2    Subd. 10. Relief from certain liability. (a) Notwithstanding subdivision 9, sellers
100.3and certified service providers are relieved from liability to the state for having charged
100.4and collected the incorrect amount of sales or use tax resulting from the seller or certified
100.5service provider (1) relying on erroneous data provided by the commissioner in the
100.6database files on tax rates, boundaries, or taxing jurisdiction assignments, or (2) relying
100.7on erroneous data provided by the state in its taxability matrix concerning the taxability
100.8of products and services.
100.9    (b) Notwithstanding subdivision 9, sellers and certified service providers are
100.10relieved from liability to the state for having charged and collected the incorrect amount
100.11of sales or use tax resulting from the seller or certified service provider relying on the
100.12certification by the commissioner as to the accuracy of a certified automated system as to
100.13the taxability of product categories. The relief from liability provided by this paragraph
100.14does not apply when the sellers or certified service providers have incorrectly classified
100.15an item or transaction into a product category, unless the item or transaction within a
100.16product category was approved by the commissioner or approved jointly by the states that
100.17are signatories to the agreement. The sellers and certified service providers must revise a
100.18classification within ten days after receipt of notice from the commissioner that an item or
100.19transaction within a product category is incorrectly classified as to its taxability, or they
100.20are not relieved from liability for the incorrect classification following the notification.
100.21(c) Notwithstanding subdivision 9, if there are not at least 30 days between the
100.22enactment of a new tax rate and the effective date of the new rate, sellers and certified
100.23service providers shall be relieved from liability for failing to collect tax at the new rate
100.24during the first 30 days of the rate change, beginning on the day after the date of enactment
100.25of the rate change, provided the seller or certified service provider continued to impose
100.26and collect the tax at the immediately preceding tax rate during this period. Relief from
100.27liability provided by this paragraph shall not apply if the failure to collect at the newly
100.28effective rate extends beyond 30 days after the enactment of the new rate. The relief
100.29provided by this paragraph shall not apply if the commissioner determines that the seller or
100.30certified service provider fraudulently failed to collect at the new rate or that the seller or
100.31certified service provider solicited purchasers based on the immediately preceding tax rate.
100.32EFFECTIVE DATE.This section is effective the day following final enactment.

100.33    Sec. 8. Minnesota Statutes 2008, section 297A.995, subdivision 11, is amended to read:
100.34    Subd. 11. Purchaser relief from certain liability. (a) Notwithstanding other
100.35provisions in the law, a purchaser is relieved from liability resulting from having paid
101.1the incorrect amount of sales or use tax if a purchaser, whether or not holding a the
101.2commissioner gave the purchaser direct pay permit authorization, or a purchaser's seller or
101.3certified service provider relied on erroneous data provided by this state in the database
101.4files on tax rates, boundaries, taxing jurisdiction assignments, or in the taxability matrix.
101.5After providing an address-based database for assigning taxing jurisdictions and their
101.6associated rates, no relief for errors resulting from the purchaser's reliance on a database
101.7using zip codes is allowed.
101.8    (b) With respect to reliance on the taxability matrix provided by this state in
101.9paragraph (a), relief is limited to erroneous classifications in the taxability matrix for
101.10items included within the classifications as "taxable," "exempt," "included in sales
101.11price," "excluded from sales price," "included in the definition," and "excluded from
101.12the definition."
101.13(c) Notwithstanding other provisions in the law, if there are not at least 30 days
101.14between the enactment of a new tax rate and the effective date of the new rate, a purchaser
101.15shall be relieved from liability resulting from failing to pay the tax at the new rate during
101.16the first 30 days of the rate change, beginning on the day after the date of enactment of
101.17the rate change, whether or not the purchaser has been given direct pay authorization by
101.18the commissioner. Relief from liability provided by this paragraph shall not apply if the
101.19failure to pay at the newly effective rate extends beyond 30 days after the enactment of
101.20the new rate, and shall not apply to a purchaser that did not continue to pay the tax at the
101.21immediately preceding tax rate during the 30-day period. The relief provided by this
101.22paragraph shall not apply if the commissioner determines that the purchaser fraudulently
101.23failed to pay at the new rate.
101.24EFFECTIVE DATE.This section is effective the day following final enactment.

101.25    Sec. 9. [645.025] SPECIAL LAWS; LOCAL TAXES.
101.26    Subdivision 1. Definitions. (a) If a special law grants a local government unit
101.27or group of units the authority to impose a local tax other than sales tax, including but
101.28not limited to taxes such as lodging, entertainment, admissions, or food and beverage
101.29taxes, and the Department of Revenue either has agreed to or is required to administer
101.30the tax, such that the tax is reported and paid with the chapter 297A taxes, then the local
101.31government unit or group of units must adopt each definition used in the special law
101.32as follows:
101.33(1) the definition must be identical to the definition found in chapter 297A or in
101.34Minnesota Rules, chapter 8130; or
102.1(2) if the specific term is not defined either in chapter 297A or in Minnesota Rules,
102.2chapter 8130, then the definition must be consistent with the position of the Department of
102.3Revenue as to the extent of the tax base.
102.4(b) This subdivision does not apply to terms that are defined by the authorizing
102.5special law.
102.6    Subd. 2. Application. This section applies to a special law that is described in
102.7subdivision 1 that was:
102.8(1) originally enacted prior to 2010, and that was amended by special law in or after
102.92010, to extend the time for imposing the tax or to modify the tax base; or
102.10(2) first enacted in or after 2010.
102.11EFFECTIVE DATE.This section is effective the day following final enactment.

102.12    Sec. 10. Laws 2009, chapter 88, article 4, section 5, the effective date, is amended to
102.13read:
102.14EFFECTIVE DATE.This section is effective July 1, 2009, and applies to
102.15registrations leases or rentals made or renewed on or after that date.
102.16EFFECTIVE DATE.This section is effective retroactively for leases or rentals
102.17made or renewed after June 30, 2009.


102.20    Section 1. Minnesota Statutes 2008, section 297A.99, subdivision 1, is amended to
102.21read:
102.22    Subdivision 1. Authorization; scope. (a) A political subdivision of this state may
102.23impose a general sales tax (1) under section 297A.992, (2) under section 297A.993, (3) if
102.24permitted by special law enacted prior to May 20, 2008, or (4) if the political subdivision
102.25enacted and imposed the tax before January 1, 1982, and its predecessor provision.
102.26    (b) This section governs the imposition of a general sales tax by the political
102.27subdivision. The provisions of this section preempt the provisions of any special law:
102.28    (1) enacted before June 2, 1997, or
102.29    (2) enacted on or after June 2, 1997, that does not explicitly exempt the special law
102.30provision from this section's rules by reference.
102.31    (c) This section does not apply to or preempt a sales tax on motor vehicles or a
102.32special excise tax on motor vehicles.
103.1    (d) Until after May 31, 2010 2012, a political subdivision may not advertise,
103.2promote, expend funds, or hold a referendum to support imposing or extending a local
103.3option sales tax unless it is for extension of an existing tax or the tax was authorized by a
103.4special law enacted prior to May 20, 2008. For purposes of this section, "extending" a tax
103.5means using an existing tax to fund one or more projects or purposes not authorized in the
103.6existing special law, or increasing the amount of money allowed to be spent on projects or
103.7purposes authorized under the existing special law.
103.8EFFECTIVE DATE.This section is effective the day following final enactment.

103.9    Sec. 2. Laws 2002, chapter 377, article 3, section 25, as amended by Laws 2009,
103.10chapter 88, article 4, section 19, is amended to read:
103.11    Sec. 25. ROCHESTER LODGING TAX.
103.12    Subdivision 1. Authorization. Notwithstanding Minnesota Statutes, section
103.13469.190 or 477A.016, or any other law, the city of Rochester may impose an additional
103.14tax of one percent on the gross receipts from the furnishing for consideration of lodging at
103.15a hotel, motel, rooming house, tourist court, or resort, other than the renting or leasing of it
103.16for a continuous period of 30 days or more.
103.17    Subd. 1a. Authorization. Notwithstanding Minnesota Statutes, section 469.190 or
103.18477A.016 , or any other law, and in addition to the tax authorized by subdivision 1, the city
103.19of Rochester may impose an additional tax of one percent on the gross receipts from the
103.20furnishing for consideration of lodging at a hotel, motel, rooming house, tourist court, or
103.21resort, other than the renting or leasing of it for a continuous period of 30 days or more only
103.22upon the approval of the city governing body of a total financial package for the project.
103.23    Subd. 2. Disposition of proceeds. (a) The gross proceeds from the tax imposed
103.24under subdivision 1 must be used by the city to fund a local convention or tourism bureau
103.25for the purpose of marketing and promoting the city as a tourist or convention center.
103.26(b) The gross proceeds from the one percent tax imposed under subdivision 1a shall
103.27be used to pay for (1) construction, renovation, improvement, and expansion of the Mayo
103.28Civic Center and related skyway access, lighting, parking, or landscaping; and (2) for
103.29payment of any principal, interest, or premium on bonds issued to finance the construction,
103.30renovation, improvement, and expansion of the Mayo Civic Center Complex.
103.31    Subd. 2a. Bonds. The city of Rochester may issue general obligation bonds of the
103.32city, in one or more series, in the aggregate principal amount not to exceed $43,500,000,
103.33to pay for capital and administrative costs for the design, construction, renovation,
103.34improvement, and expansion of the Mayo Civic Center Complex, and related skyway,
103.35access, lighting, parking, and landscaping. The city may pledge the lodging tax authorized
104.1by subdivision 1a and the food and beverage tax authorized under Laws 2009, chapter
104.288, article 4, section 23, to the payment of the bonds. The debt represented by the bonds
104.3is not included in computing any debt limitations applicable to the city, and the levy of
104.4taxes required by Minnesota Statutes, section 475.61, to pay the principal of and interest
104.5on the bonds is not subject to any levy limitation or included in computing or applying
104.6any levy limitation applicable to the city.
104.7    Subd. 3. Expiration of taxing authority. The authority of the city to impose a tax
104.8under subdivision 1a shall expire when the principal and interest on any bonds or other
104.9obligations issued prior to December 31, 2014, to finance the construction, renovation,
104.10improvement, and expansion of the Mayo Civic Center Complex and related skyway
104.11access, lighting, parking, or landscaping have been paid, including any bonds issued to
104.12refund such bonds, or at an earlier time as the city shall, by ordinance, determine. Any
104.13funds remaining after completion of the project and retirement or redemption of the bonds
104.14shall be placed in the general fund of the city.
104.15EFFECTIVE DATE.This section is effective the day after the governing body of
104.16the city of Rochester and its chief clerical officer comply with Minnesota Statutes, section
104.17645.021, subdivisions 2 and 3.

104.18    Sec. 3. Laws 2009, chapter 88, article 4, section 23, subdivision 4, is amended to read:
104.19    Subd. 4. Expiration of taxing authority. The authority granted under subdivision
104.201 to the city to impose a one percent tax on food and beverages shall expire when the
104.21principal and interest on any bonds or other obligations issued prior to December 31,
104.222014, to finance the construction, renovation, improvement, and expansion of the Mayo
104.23Civic Center Complex and related skyway access, lighting, parking, or landscaping, and
104.24any bonds issued to refund such bonds, have been paid or at an earlier time as the city
104.25shall, by ordinance, determine. Any funds remaining after completion of the project and
104.26retirement or redemption of the bonds shall be placed in the general fund of the city.
104.27EFFECTIVE DATE.This section is effective the day after the governing body of
104.28the city of Rochester and its chief clerical officer comply with Minnesota Statutes, section
104.29645.021, subdivisions 2 and 3.

104.30    Sec. 4. CITY OF DETROIT LAKES; LOCAL TAXES AUTHORIZED.
104.31    Subdivision 1. Food and beverage tax authorized. Notwithstanding Minnesota
104.32Statutes, section 477A.016, or any ordinance, city charter, or other provision of law, the
104.33city of Detroit Lakes may, by ordinance, impose a sales tax of one-half of one percent
105.1on the gross receipts of all food and beverages by a restaurant or place of refreshment,
105.2as defined by resolution of the city, that is located within the city. For purposes of this
105.3section, "food and beverages" include retail on-sale of intoxicating liquor and fermented
105.4malt beverages.
105.5    Subd. 2. Entertainment tax. Notwithstanding Minnesota Statutes, section
105.6477A.016, or any ordinance, city charter, or other provision of law, the city of Detroit
105.7Lakes may, by ordinance, impose a tax of one-half of one percent on the gross receipts
105.8on admission to an entertainment event located within the city. For purposes of this
105.9section, "entertainment event" means any event for which persons pay money in order to
105.10be admitted to the premises and to be entertained, including, but not limited to, theaters,
105.11concerts, and sporting events.
105.12    Subd. 3. Use of proceeds from authorized taxes. The proceeds of the taxes
105.13imposed under subdivisions 1 and 2 must be used by the city to pay all or a portion of the
105.14expenses of the following projects:
105.15(1) control of flowering rush infestation;
105.16(2) construction and improvement of bike trail facilities;
105.17(3) parking improvements near public facilities; and
105.18(4) redevelopment of the area returned to the city as a result of realignment of
105.19Highway 10.
105.20    Subd. 4. Expiration of taxing authority. The taxes authorized under subdivisions 1
105.21and 2 expire when the governing body of the city determines that sufficient revenues have
105.22been raised to finance the projects in subdivision 3, including the amount to prepay to retire
105.23at maturity the principal, interest, and premium due on any bonds issued for the projects.
105.24    Subd. 5. Collection, administration, and enforcement. The city may enter into
105.25an agreement with the commissioner of revenue to administer, collect, and enforce the
105.26taxes under subdivisions 1 and 2. If the commissioner agrees to collect the tax, the
105.27provisions of Minnesota Statutes, section 297A.99, related to collection, administration,
105.28and enforcement apply.
105.29EFFECTIVE DATE.This section is effective the day after the governing body of
105.30the city of Detroit Lakes and its chief clerical officer comply with Minnesota Statutes,
105.31section 645.021, subdivisions 2 and 3.

105.32    Sec. 5. CITY OF MARSHALL; SALES AND USE TAX.
106.1    Subdivision 1. Authorization. Notwithstanding Minnesota Statutes, section
106.2297A.99, subdivisions 1, 2, and 3, or 477A.016, or any other law, ordinance, or city
106.3charter, the city of Marshall, if imposed within two years of the date of final enactment of
106.4this section, may impose any or all of the taxes described in this section.
106.5    Subd. 2. Bonds. (a) The city of Marshall may issue bonds under Minnesota Statutes,
106.6chapter 475, to finance all or a portion of the costs of the new and existing facilities of the
106.7Minnesota Emergency Response and Industry Training Center and all or part of the costs
106.8of the facilities of the Southwest Minnesota Regional Amateur Sports Center, and may
106.9issue bonds to refund bonds previously issued. Authorized expenses include, but are not
106.10limited to, acquiring property, predesign, design, and paying construction, furnishing, and
106.11equipment costs related to these facilities. The aggregate principal amount of bonds issued
106.12under this subdivision may not exceed $17,290,000, plus an amount to be applied to the
106.13payment of the costs of issuing the bonds. The bonds may be paid from or secured by
106.14any funds available to the city of Marshall.
106.15(b) The bonds are not included in computing any debt limitation applicable to the
106.16city of Marshall, and any levy of taxes under Minnesota Statutes, section 475.61, to pay
106.17principal and interest on the bonds, is not subject to any levy limitation. A separate
106.18election to approve the bonds under Minnesota Statutes, section 475.58, is not required.
106.19    Subd. 3. Lodging tax. The city of Marshall may impose by ordinance a tax of up to
106.201-1/2 percent on the gross receipts subject to the lodging tax under Minnesota Statutes,
106.21section 469.190, for the purposes specified in subdivision 4. This lodging tax is in addition
106.22to any tax imposed under Minnesota Statutes, section 469.190, and may be imposed
106.23within a tax district defined by the city council, which may include areas of the city of
106.24Marshall which are not contiguous.
106.25    Subd. 4. Use of lodging tax revenues. The revenues derived from the tax imposed
106.26under subdivision 3 must be used by the city of Marshall to pay the costs of collecting
106.27and administering the lodging tax, to pay all or part of the operating costs of the new and
106.28existing facilities of the Minnesota Emergency Response and Industry Training Center,
106.29including the payment of debt service on bonds issued under subdivision 2, and to pay
106.30all or part of the operating costs of the facilities of the Southwest Minnesota Regional
106.31Amateur Sports Center, including the payment of debt service on bonds issued under
106.32subdivision 2.
106.33    Subd. 5. Food and beverages tax. The city of Marshall may impose by ordinance
106.34an additional sales tax of up to 1-1/2 percent on all sales of food and beverages primarily
107.1for consumption on the premises by restaurants and places of refreshment that occur
107.2in the city of Marshall. The provisions of Minnesota Statutes, section 297A.99,
107.3except subdivisions 1, 2, and 3, govern the imposition, administration, collection, and
107.4enforcement of the tax authorized under this subdivision.
107.5    Subd. 6. Use of food and beverages tax. The revenues derived from the tax
107.6imposed under subdivision 5 must be used by the city of Marshall to pay the costs of
107.7collecting and administering the food and beverages tax, to pay all or part of the operating
107.8costs of the new and existing facilities of the Minnesota Emergency Response and
107.9Industry Training Center, including the payment of debt service on bonds issued under
107.10subdivision 2, and to pay all or part of the operating costs of the facilities of the Southwest
107.11Minnesota Regional Amateur Sports Center, including the payment of debt service on
107.12bonds issued under subdivision 2.
107.13    Subd. 7. Termination of taxes. The taxes imposed under subdivisions 3 and 5
107.14expire at the earlier of (1) 30 years after the tax is first imposed, or (2) when the city
107.15council determines that the amount of revenues received from the taxes to pay for the
107.16capital, operating, and administrative costs of the facilities under subdivisions 2, 4,
107.17and 6 first equals or exceeds the amount authorized to be spent for the facilities plus
107.18the additional amount needed to pay the costs related to issuance of the bonds under
107.19subdivision 2, including interest on the bonds. Any funds remaining after payment of all
107.20the costs and retirement or redemption of the bonds must be placed in the general fund of
107.21the city. The taxes imposed under subdivisions 3 and 5 may expire at an earlier time if the
107.22city so determines by ordinance.
107.23EFFECTIVE DATE.This section is effective the day after compliance by the
107.24governing body of the city of Marshall with Minnesota Statutes, section 645.021,
107.25subdivision 3.

107.26    Sec. 6. GIANTS RIDGE RECREATION AREA TAXING AUTHORITY.
107.27    Subdivision 1. Additional taxes authorized. Notwithstanding Minnesota Statutes,
107.28section 477A.016, or any other law, ordinance, or charter provision to the contrary, the
107.29city of Biwabik, upon approval both by its governing body and by the vote of at least
107.30seven members of the Iron Range Resources and Rehabilitation Board, may impose any or
107.31all of the taxes described in this section.
107.32    Subd. 2. Use of proceeds. The proceeds of any taxes imposed under this section,
107.33less refunds and costs of collection, must be deposited into the Iron Range Resources and
108.1Rehabilitation Board account enterprise fund created under the provisions of Minnesota
108.2Statutes, section 298.221, paragraph (c), and must be dedicated and expended by the
108.3commissioner of the Iron Range Resources and Rehabilitation Board, upon approval by
108.4the vote of at least seven members of the Iron Range Resources and Rehabilitation Board,
108.5to pay costs for the construction, renovation, improvement, expansion, and maintenance
108.6of public recreational facilities located in those portions of the city within the Giants
108.7Ridge Recreation Area as defined in Minnesota Statutes, section 298.22, subdivision 7, or
108.8to pay any principal, interest, or premium on any bond issued to finance the construction,
108.9renovation, improvement, or expansion of such public recreational facilities.
108.10    Subd. 3. Lodging tax. The city of Biwabik, upon approval both by its governing
108.11body and by the vote of at least seven members of the Iron Range Resources and
108.12Rehabilitation Board, may impose, by ordinance, a tax of not more than five percent on the
108.13gross receipts subject to the lodging tax under Minnesota Statutes, section 469.190. This
108.14tax is in addition to any tax imposed under Minnesota Statutes, section 469.190, and may
108.15be imposed only on gross lodging receipts generated within the Giants Ridge Recreation
108.16Area as defined in Minnesota Statutes, section 298.22, subdivision 7.
108.17    Subd. 4. Admissions and recreation tax. (a) The city of Biwabik, upon approval
108.18both by its governing body and by the vote of at least seven members of the Iron Range
108.19Resources and Rehabilitation Board, may impose, by ordinance, a tax of not more than five
108.20percent on admission receipts to entertainment and recreational facilities and on receipts
108.21from the rental of recreation equipment, at sites within the Giants Ridge Recreation Area as
108.22defined in Minnesota Statutes, section 298.22, subdivision 7. The provisions of Minnesota
108.23Statutes, section 297A.99, except for subdivisions 2 and 3, govern the imposition,
108.24administration, collection, and enforcement of the tax authorized in this subdivision.
108.25(b) If the city imposes the tax under paragraph (a), it must include in the ordinance
108.26an exemption for purchases of season tickets or passes.
108.27    Subd. 5. Food and beverage tax. The city of Biwabik, upon approval both by its
108.28governing body and by the vote of at least seven members of the Iron Range Resources
108.29and Rehabilitation Board, may impose, by ordinance, an additional sales tax of not more
108.30than one percent on sales of food and beverages primarily for consumption on or off
108.31the premises by restaurants and places of refreshment as defined by resolution of the
108.32city within the Giants Ridge Recreation Area as defined in Minnesota Statutes, section
108.33298.22, subdivision 7. The provisions of Minnesota Statutes, section 297A.99, except for
108.34subdivisions 2 and 3, govern the imposition, administration, collection, and enforcement
108.35of the tax authorized in this subdivision.
109.1EFFECTIVE DATE.This section shall be effective the day after compliance with
109.2Minnesota Statutes, section 645.021, subdivisions 2 and 3, by the governing body of the
109.3city of Biwabik. Notwithstanding Minnesota Statutes, section 645.021, subdivision 3, the
109.4city may comply with Minnesota Statutes, section 645.021, at any time before January
109.51, 2012.


109.8    Section 1. Minnesota Statutes 2008, section 60A.209, subdivision 1, is amended to
109.9read:
109.10    Subdivision 1. Authorization; regulation. A resident of this state may obtain
109.11insurance from an ineligible surplus lines insurer in this state through a surplus lines
109.12licensee. The licensee shall first attempt to place the insurance with a licensed insurer, or
109.13if that is not possible, with an eligible surplus lines insurer. If coverage is not obtainable
109.14from a licensed insurer or an eligible surplus lines insurer, the licensee shall certify to the
109.15commissioner, on a form prescribed by the commissioner, that these attempts were made.
109.16Upon obtaining coverage from an ineligible surplus lines insurer, the licensee shall:
109.17(a) Have printed, typed, or stamped in red ink upon the face of the policy in
109.18not less than 10-point type the following notice: "THIS INSURANCE IS ISSUED
109.19PURSUANT TO THE MINNESOTA SURPLUS LINES INSURANCE ACT. THIS
109.20INSURANCE IS PLACED WITH AN INSURER THAT IS NOT LICENSED BY THE
109.21STATE NOR RECOGNIZED BY THE COMMISSIONER OF COMMERCE AS AN
109.22ELIGIBLE SURPLUS LINES INSURER. IN CASE OF ANY DISPUTE RELATIVE
109.23TO THE TERMS OR CONDITIONS OF THE POLICY OR THE PRACTICES OF
109.24THE INSURER, THE COMMISSIONER OF COMMERCE WILL NOT BE ABLE TO
109.25ASSIST IN THE DISPUTE. IN CASE OF INSOLVENCY, PAYMENT OF CLAIMS IS
109.26NOT GUARANTEED." The notice may not be covered or concealed in any manner; and
109.27(b) Collect from the insured appropriate premium taxes, as provided under chapter
109.28297I, and report the transaction to the commissioner of revenue on a form prescribed by
109.29the commissioner. If the insured fails to pay the taxes when due, the insured shall be
109.30subject to a civil fine of not more than $3,000, plus accrued interest from the inception of
109.31the insurance.
109.32EFFECTIVE DATE.This section is effective the day following final enactment.

109.33    Sec. 2. Minnesota Statutes 2008, section 295.55, subdivision 2, is amended to read:
110.1    Subd. 2. Estimated tax; hospitals; surgical centers. (a) Each hospital or surgical
110.2center must make estimated payments of the taxes for the calendar year in monthly
110.3installments to the commissioner within 15 days after the end of the month.
110.4(b) Estimated tax payments are not required of hospitals or surgical centers if: (1)
110.5the tax for the current calendar year is less than $500 or less; or (2) the tax for the previous
110.6calendar year is less than $500, if the taxpayer had a tax liability and was doing business
110.7the entire year or less.
110.8(c) Underpayment of estimated installments bear interest at the rate specified in
110.9section 270C.40, from the due date of the payment until paid or until the due date of the
110.10annual return whichever comes first. An underpayment of an estimated installment is the
110.11difference between the amount paid and the lesser of (1) 90 percent of one-twelfth of the
110.12tax for the calendar year or (2) one-twelfth of the total tax for the previous calendar year
110.13if the taxpayer had a tax liability and was doing business the entire year.
110.14EFFECTIVE DATE.This section is effective for gross revenues received after
110.15December 31, 2010.

110.16    Sec. 3. Minnesota Statutes 2008, section 295.55, subdivision 3, is amended to read:
110.17    Subd. 3. Estimated tax; other taxpayers. (a) Each taxpayer, other than a hospital
110.18or surgical center, must make estimated payments of the taxes for the calendar year in
110.19quarterly installments to the commissioner by April 15, July 15, October 15, and January
110.2015 of the following calendar year.
110.21(b) Estimated tax payments are not required if: (1) the tax for the current calendar
110.22year is less than $500 or less; or (2) the tax for the previous calendar year is less than
110.23$500, if the taxpayer had a tax liability and was doing business the entire year or less.
110.24(c) Underpayment of estimated installments bear interest at the rate specified in
110.25section 270C.40, from the due date of the payment until paid or until the due date of the
110.26annual return whichever comes first. An underpayment of an estimated installment is the
110.27difference between the amount paid and the lesser of (1) 90 percent of one-quarter of the
110.28tax for the calendar year or (2) one-quarter of the total tax for the previous calendar year
110.29if the taxpayer had a tax liability and was doing business the entire year.
110.30EFFECTIVE DATE.This section is effective for gross revenues received after
110.31December 31, 2010.

110.32    Sec. 4. [296A.061] CANCELLATION OR NONRENEWAL OF LICENSES.
111.1The commissioner may cancel a license or not renew a license if one of the following
111.2conditions occurs:
111.3(1) the license holder has not filed a petroleum tax return or report for at least one
111.4year;
111.5(2) the license holder has not reported any petroleum tax liability on the license
111.6holder's returns or reports for at least one year; or
111.7(3) the license holder requests cancellation of the license.
111.8EFFECTIVE DATE.This section is effective the day following final enactment.

111.9    Sec. 5. Minnesota Statutes 2008, section 297F.01, subdivision 22a, is amended to read:
111.10    Subd. 22a. Weighted average retail price. "Weighted average retail price" means
111.11(1) the average retail price per pack of 20 cigarettes, with the average price weighted by
111.12the number of packs sold at each price, (2) reduced by the sales tax included in the retail
111.13price, and (3) adjusted for the expected inflation from the time of the survey to the average
111.14of the 12 months that the sales tax will be imposed. The commissioner shall make the
111.15inflation adjustment in accordance with the Consumer Price Index for all urban consumers
111.16inflation indicator as published in the most recent state budget forecast. The inflation
111.17factor for the calendar year in which the new tax rate takes effect must be used. If the
111.18survey indicates that the average retail price of cigarettes has not increased relative to the
111.19average retail price in the previous year's survey, then no inflation adjustment must be
111.20made as provided in section 297F.25, subdivision 1.
111.21EFFECTIVE DATE.This section is effective January 1, 2011.

111.22    Sec. 6. Minnesota Statutes 2008, section 297F.04, is amended by adding a subdivision
111.23to read:
111.24    Subd. 2a. Cancellation or nonrenewal. The commissioner may cancel a license or
111.25not renew a license if one of the following conditions occurs:
111.26(1) the license holder has not filed a cigarette or tobacco products tax return for at
111.27least one year;
111.28(2) the license holder has not reported any cigarette or tobacco products tax liability
111.29on the license holder's returns for at least one year; or
111.30(3) the license holder requests cancellation of the license.
111.31EFFECTIVE DATE.This section is effective the day following final enactment.

111.32    Sec. 7. Minnesota Statutes 2008, section 297F.07, subdivision 4, is amended to read:
112.1    Subd. 4. Sales to nonqualified buyers. A retailer who sells or otherwise disposes of
112.2unstamped or untaxed stock other than to a qualified purchaser shall collect from the buyer
112.3or transferee the tax imposed by section 297F.05, and remit the tax to the Department of
112.4Revenue at the same time and manner as required by section 297F.09. If the retailer fails
112.5to collect the tax from the buyer or transferee, or fails to remit the tax, the retailer is
112.6personally responsible for the tax and the commissioner may seize any product destined to
112.7be delivered to the retailer. The product so seized shall be considered contraband and be
112.8subject to the procedures outlined in section 297F.21, subdivision 3. The proceeds of the
112.9sale of the stock may be applied to any tax liability owed by the retailer after deducting all
112.10costs and expenses.
112.11This section does not relieve the buyer or possessor of unstamped or untaxed stock
112.12from personal liability for the tax.
112.13EFFECTIVE DATE.This section is effective the day following final enactment.

112.14    Sec. 8. Minnesota Statutes 2008, section 297F.25, subdivision 1, is amended to read:
112.15    Subdivision 1. Imposition. (a) A tax is imposed on distributors on the sale of
112.16cigarettes by a cigarette distributor to a retailer or cigarette subjobber for resale in this
112.17state. The tax is equal to 6.5 percent of the weighted average retail price. The weighted
112.18average retail price and must be expressed in cents per pack when rounded to the nearest
112.19one-tenth of a cent. The weighted average retail price must be determined annually,
112.20with new rates published by May November 1, and effective for sales on or after August
112.21January 1 of the following year. The weighted average retail price must be established
112.22by surveying cigarette retailers statewide in a manner and time determined by the
112.23commissioner. The commissioner shall make an inflation adjustment in accordance with
112.24the Consumer Price Index for all urban consumers inflation indicator as published in the
112.25most recent state budget forecast. The commissioner shall use the inflation factor for
112.26the calendar year in which the new tax rate takes effect. If the survey indicates that the
112.27average retail price of cigarettes has not increased relative to the average retail price in
112.28the previous year's survey, then the commissioner shall not make an inflation adjustment.
112.29The determination of the commissioner pursuant to this subdivision is not a "rule" and is
112.30not subject to the Administrative Procedure Act contained in chapter 14. As of August 1,
112.312005, the tax is 25.5 cents per pack of 20 cigarettes. For packs of cigarettes with other
112.32than 20 cigarettes, the tax must be adjusted proportionally.
112.33(b) Notwithstanding paragraph (a), and in lieu of a survey of cigarette retailers, the
112.34tax calculation of the weighted average retail price for the sales of cigarettes from August
112.351, 2011, through December 31, 2011, shall be calculated by: (1) increasing the average
113.1retail price per pack of 20 cigarettes from the most recent survey by the percentage change
113.2in a weighted average of the presumed legal prices for cigarettes during the year after
113.3completion of that survey, as reported and published by the Department of Commerce
113.4under section 325D.371; (2) subtracting the sales tax included in the retail price; and (3)
113.5adjusting for expected inflation. The rate must be published by May 1 and is effective for
113.6sales after July 31. If the weighted average of the presumed legal prices indicates that the
113.7average retail price of cigarettes has not increased relative to the average retail price in the
113.8most recent survey, then no inflation adjustment must be made. For packs of cigarettes
113.9with other than 20 cigarettes, the tax must be adjusted proportionally.
113.10EFFECTIVE DATE.This section is effective January 1, 2011.

113.11    Sec. 9. Minnesota Statutes 2008, section 297I.01, subdivision 9, is amended to read:
113.12    Subd. 9. Gross premiums. "Gross premiums" means total premiums paid by
113.13policyholders and applicants of policies, whether received in the form of money or other
113.14valuable consideration, on property, persons, lives, interests and other risks located,
113.15resident, or to be performed in this state, but excluding consideration and premiums for
113.16reinsurance assumed from other insurance companies.
113.17 The term (a) "Gross premiums" includes the total consideration paid to bail bond
113.18agents for bail bonds.
113.19(b) For title insurance companies, "gross premiums" means the charge for title
113.20insurance made by a title insurance company or its agents according to the company's rate
113.21filing approved by the commissioner of commerce without a deduction for commissions
113.22paid to or retained by the agent. Gross premiums of a title insurance company does not
113.23include any other charge or fee for abstracting, searching, or examining the title, or
113.24escrow, closing, or other related services.
113.25 The term (c) "Gross premiums" includes any workers' compensation special
113.26compensation fund premium surcharge pursuant to section 176.129.
113.27(d) "Gross premiums" for surplus lines insurance includes all related charges,
113.28commissions, and fees received by the licensee. Gross premiums does not include the
113.29stamping fee, as provided under section 60A.2085, subdivision 7, nor the operating
113.30assessment, as provided under section 60A.208, subdivision 8.
113.31EFFECTIVE DATE.This section is effective the day following final enactment.

113.32    Sec. 10. Minnesota Statutes 2008, section 297I.05, subdivision 7, is amended to read:
114.1    Subd. 7. Surplus lines tax. (a) A tax is imposed on surplus lines licensees. The rate
114.2of tax is equal to three percent of the gross premiums less return premiums received by the
114.3licensee minus any licensee association operating assessments paid under section 60A.208.
114.4(b) If surplus lines insurance placed by a surplus lines licensee and taxed under this
114.5subdivision covers a subject of insurance residing, located, or to be performed outside
114.6this state, a proper pro rata portion of the entire premium payable for all of that insurance
114.7must be allocated according to the subjects of insurance residing, located, or to be
114.8performed in this state.
114.9EFFECTIVE DATE.This section is effective the day following final enactment.

114.10    Sec. 11. Minnesota Statutes 2008, section 297I.30, subdivision 1, is amended to read:
114.11    Subdivision 1. General rule. On or before March 1, every insurer taxpayer subject
114.12to taxation under section 297I.05, subdivisions 1 to 6 5, and 9, 10, 12, paragraphs
114.13(a), clauses (1) to (5) (4), and (b), (c), and (d), and 14, shall file an annual return for
114.14the preceding calendar year setting forth such information as the commissioner may
114.15reasonably require on forms in the form prescribed by the commissioner.
114.16EFFECTIVE DATE.This section is effective the day following final enactment.

114.17    Sec. 12. Minnesota Statutes 2008, section 297I.30, subdivision 2, is amended to read:
114.18    Subd. 2. Surplus lines licensees and purchasing groups. On or before February 15
114.19and August 15 of each year, every surplus lines licensee subject to taxation under section
114.20297I.05, subdivision 7 , and every purchasing group or member of a purchasing group
114.21subject to tax under section 297I.05, subdivision 12, paragraph (a), clause (6) (5), shall file
114.22a return with the commissioner for the preceding six-month period ending December 31,
114.23or June 30, setting forth any information the commissioner reasonably prescribes on forms
114.24in the form prescribed by the commissioner.
114.25EFFECTIVE DATE.This section is effective the day following final enactment.

114.26    Sec. 13. Minnesota Statutes 2008, section 297I.30, subdivision 7, is amended to read:
114.27    Subd. 7. Surcharge. (a)(1) By April 30 of each year, every company required to pay
114.28the surcharge under section 297I.10, subdivision 1, shall file a return for the five-month
114.29period ending March 31 setting forth any information the commissioner reasonably
114.30requires on forms in the form prescribed by the commissioner.
114.31(2) (b) By June 30 of each year, every company required to pay the surcharge under
114.32section 297I.10, subdivision 1, shall file a return for the two-month period ending May 31
115.1setting forth any information the commissioner reasonably requires on forms in the form
115.2prescribed by the commissioner.
115.3(3) (c) By November 30 of each year, every company required to pay the surcharge
115.4under section 297I.10, subdivision 1, shall file a return for the five-month period ending
115.5October 31 setting forth any information the commissioner reasonably requires on forms
115.6in the form prescribed by the commissioner.
115.7(b) By February 15 and August 15 of each year, every company required to pay
115.8a surcharge under section 297I.10, subdivision 2, must file a return for the preceding
115.9six-month period ending December 31 and June 30.
115.10EFFECTIVE DATE.This section is effective the day following final enactment.

115.11    Sec. 14. Minnesota Statutes 2008, section 297I.30, subdivision 8, is amended to read:
115.12    Subd. 8. Fire insurance surcharge. On or before May 15, August 15, November
115.1315, and February 15 of each year, every insurer required to pay the surcharge under
115.14section 297I.06, subdivisions 1 and 2, shall file a return with the commissioner for the
115.15preceding three-month period ending March 31, June 30, September 30, and December
115.1631, setting forth any information the commissioner reasonably requires on forms in the
115.17form prescribed by the commissioner.
115.18EFFECTIVE DATE.This section is effective the day following final enactment.

115.19    Sec. 15. Minnesota Statutes 2009 Supplement, section 297I.35, subdivision 2, is
115.20amended to read:
115.21    Subd. 2. Electronic payments. If the aggregate amount of tax and surcharges
115.22due under this chapter during a calendar fiscal year ending June 30 is equal to or
115.23exceeds $10,000, or if the taxpayer is required to make payment of any other tax to the
115.24commissioner by electronic means, then all tax and surcharge payments in the subsequent
115.25calendar year must be paid by electronic means.
115.26EFFECTIVE DATE.This section is effective for payments due in calendar year
115.272010 and thereafter, based upon liabilities incurred in the fiscal year ending June 30,
115.282009, and in fiscal years thereafter.

115.29    Sec. 16. Minnesota Statutes 2008, section 297I.40, subdivision 1, is amended to read:
115.30    Subdivision 1. Requirement to pay. On or before March 15, June 15, September
115.3115, and December 15 of the current year, every taxpayer subject to tax under section
115.32297I.05, subdivisions 1 to 6 5 , and 12, paragraphs paragraph (a), clauses (1) to (5), (b),
116.1and (e) (4), and 14, must pay to the commissioner an installment equal to one-fourth of the
116.2insurer's total estimated tax for the current year.
116.3EFFECTIVE DATE.This section is effective the day following final enactment.

116.4    Sec. 17. Minnesota Statutes 2008, section 297I.40, subdivision 5, is amended to read:
116.5    Subd. 5. Definition of tax. The term "tax" as used in this section means the tax
116.6imposed by section 297I.05, subdivisions 1 to 6 5, 11, and 12, paragraphs (a), clauses (1)
116.7to (5) (4), (b), and (d), and 14, less any offset in section 297I.20.
116.8EFFECTIVE DATE.This section is effective the day following final enactment.

116.9    Sec. 18. Minnesota Statutes 2008, section 297I.65, is amended by adding a subdivision
116.10to read:
116.11    Subd. 4. Omission in excess of 25 percent. Additional taxes or surcharges may be
116.12assessed within 6-1/2 years after the due date of the return or the date the return was filed,
116.13whichever is later, if the taxpayer omits from a gross premiums tax or surcharge return an
116.14amount of tax in excess of 25 percent of the tax or surcharge reported in the return.
116.15EFFECTIVE DATE.This section is effective for premium taxes due after
116.16December 31, 2010.

116.17    Sec. 19. Minnesota Statutes 2008, section 298.282, subdivision 1, is amended to read:
116.18    Subdivision 1. Distribution of taconite municipal aid account. The amount
116.19deposited with the county as provided in section 298.28, subdivision 3, must be distributed
116.20as provided by this section among: (1) the municipalities comprising a tax relief taconite
116.21assistance area under section 273.134, paragraph (b) 273.1341; (2) a township that
116.22contains a state park consisting primarily of an underground iron ore mine; and (3) a city
116.23located within five miles of that state park, each being referred to in this section as a
116.24qualifying municipality.
116.25EFFECTIVE DATE.This section is effective for distributions made after the
116.26day following final enactment.

116.27    Sec. 20. REPEALER.
116.28Minnesota Statutes 2008, section 297I.30, subdivisions 4, 5, and 6, are repealed.
116.29EFFECTIVE DATE.This section is effective the day following final enactment.


117.3    Section 1. Minnesota Statutes 2008, section 103D.335, subdivision 17, is amended to
117.4read:
117.5    Subd. 17. Borrowing funds. The managers may borrow funds from an agency of
117.6the federal government, a state agency, a county where the watershed district is located
117.7in whole or in part, or a financial institution authorized under chapter 47 to do business
117.8in this state. A county board may lend the amount requested by a watershed district. A
117.9watershed district may not have more than a total of $600,000 $2,000,000 in loans from
117.10counties and financial institutions under this subdivision outstanding at any time.

117.11    Sec. 2. Minnesota Statutes 2008, section 469.101, subdivision 1, is amended to read:
117.12    Subdivision 1. Establishment. An economic development authority may create and
117.13define the boundaries of economic development districts at any place or places within the
117.14city if the district satisfies the requirements of section 469.174, subdivision 10, except that
117.15the district boundaries must be contiguous, and may use the powers granted in sections
117.16469.090 to 469.108 to carry out its purposes. First the authority must hold a public hearing
117.17on the matter. At least ten days before the hearing, the authority shall publish notice of
117.18the hearing in a daily newspaper of general circulation in the city. Also, the authority
117.19shall find that an economic development district is proper and desirable to establish and
117.20develop within the city.
117.21EFFECTIVE DATE.This section is effective for economic development districts
117.22created after the day following final enactment.

117.23    Sec. 3. Minnesota Statutes 2008, section 469.319, subdivision 5, is amended to read:
117.24    Subd. 5. Waiver authority. (a) The commissioner may waive all or part of a
117.25repayment required under subdivision 1, if the commissioner, in consultation with
117.26the commissioner of employment and economic development and appropriate officials
117.27from the local government units in which the qualified business is located, determines
117.28that requiring repayment of the tax is not in the best interest of the state or the local
117.29government units and the business ceased operating as a result of circumstances beyond
117.30its control including, but not limited to:
117.31    (1) a natural disaster;
117.32    (2) unforeseen industry trends; or
117.33    (3) loss of a major supplier or customer.
118.1    (b)(1) The commissioner shall waive repayment required under subdivision 1a if
118.2the commissioner has waived repayment by the operating business under subdivision 1,
118.3unless the person that received benefits without having to operate a business in the zone
118.4was a contributing factor in the qualified business becoming subject to repayment under
118.5subdivision 1;
118.6    (2) the commissioner shall waive the repayment required under subdivision 1a, even
118.7if the repayment has not been waived for the operating business if:
118.8    (i) the person that received benefits without having to operate a business in the zone
118.9and the business that operated in the zone are not related parties as defined in section
118.10267(b) of the Internal Revenue Code of 1986, as amended through December 31, 2007; and
118.11    (ii) actions of the person were not a contributing factor in the qualified business
118.12becoming subject to repayment under subdivision 1.
118.13(c) Requests for waiver must be made no later than 60 days after the notice date of
118.14an order issued under subdivision 4, paragraph (d), or, in the case of property taxes, within
118.1560 days of the date of a tax statement issued under subdivision 4, paragraph (c).
118.16EFFECTIVE DATE.This section is effective for waivers requested in response
118.17to notices issued after the day following final enactment.

118.18    Sec. 4. Minnesota Statutes 2008, section 469.3193, is amended to read:
118.19469.3193 CERTIFICATION OF CONTINUING ELIGIBILITY FOR JOBZ
118.20BENEFITS.
118.21    (a) By December 1 October 15 of each year, every qualified business must certify
118.22to the commissioner of revenue, on a form prescribed by the commissioner of revenue,
118.23whether it is in compliance with any agreement required as a condition for eligibility for
118.24benefits listed under section 469.315. A business that fails to submit the certification, or
118.25any business, including those still operating in the zone, that submits a certification that
118.26the commissioner of revenue later determines materially misrepresents the business's
118.27compliance with the agreement, is subject to the repayment provisions under section
118.28469.319 from January 1 of the year in which the report is due or the date that the business
118.29became subject to section 469.319, whichever is earlier. Any such business is permanently
118.30barred from obtaining benefits under section 469.315. For purposes of this section, the bar
118.31applies to an entity and also applies to any individuals or entities that have an ownership
118.32interest of at least 20 percent of the entity.
118.33    (b) Before the sanctions under paragraph (a) apply to a business that fails to
118.34submit the certification, the commissioner of revenue shall send notice to the business,
119.1demanding that the certification be submitted within 30 days and advising the business
119.2of the consequences for failing to do so. The commissioner of revenue shall notify
119.3the commissioner of employment and economic development and the appropriate job
119.4opportunity subzone administrator whenever notice is sent to a business under this
119.5paragraph.
119.6    (c) The certification required under this section is public.
119.7    (d) The commissioner of revenue shall promptly notify the commissioner of
119.8employment and economic development of all businesses that certify that they are not
119.9in compliance with the terms of their business subsidy agreement and all businesses
119.10that fail to file the certification.
119.11EFFECTIVE DATE.This section is effective for certifications required to be
119.12made in 2010 and thereafter.

119.13    Sec. 5. Minnesota Statutes 2008, section 473.39, is amended by adding a subdivision
119.14to read:
119.15    Subd. 1p. Obligations. After July 1, 2010, in addition to other authority in this
119.16section, the council may issue certificates of indebtedness, bonds, or other obligations
119.17under this section in an amount not exceeding $34,600,000 for capital expenditures as
119.18prescribed in the council's transit capital improvement program and for related costs,
119.19including the costs of issuance and sale of the obligations.
119.20EFFECTIVE DATE.This section is effective the day following final enactment
119.21and applies in the counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and
119.22Washington.

119.23    Sec. 6. Minnesota Statutes 2008, section 474A.04, subdivision 6, is amended to read:
119.24    Subd. 6. Entitlement transfers. An entitlement issuer may enter into an agreement
119.25with another entitlement issuer whereby the recipient entitlement issuer issues obligations
119.26pursuant to bonding authority allocated to the original entitlement issuer under this
119.27section. An entitlement issuer may enter into an agreement with an issuer which is not
119.28an entitlement issuer whereby the recipient issuer issues qualified mortgage bonds, up to
119.29$100,000 of which are issued pursuant to bonding authority allocated to the original
119.30entitlement issuer under this section. The agreement may be approved and executed by the
119.31mayor of the entitlement issuer with or without approval or review by the city council.
119.32Notwithstanding section 474A.091, subdivision 4, prior to December 1, the Minnesota
119.33Housing Finance Agency, Minnesota Office of Higher Education, and Minnesota Rural
120.1Finance Authority may transfer allocated bonding authority made available under this
120.2chapter to one another under an agreement by each agency and the commissioner.

120.3    Sec. 7. Minnesota Statutes 2008, section 474A.091, subdivision 3, is amended to read:
120.4    Subd. 3. Allocation procedure. (a) The commissioner shall allocate available
120.5bonding authority under this section on the Monday of every other week beginning with
120.6the first Monday in August through and on the last Monday in November. Applications
120.7for allocations must be received by the department by 4:30 p.m. on the Monday preceding
120.8the Monday on which allocations are to be made. If a Monday falls on a holiday, the
120.9allocation will be made or the applications must be received by the next business day
120.10after the holiday.
120.11(b) Prior to October 1, only the following applications shall be awarded allocations
120.12from the unified pool. Allocations shall be awarded in the following order of priority:
120.13(1) applications for residential rental project bonds;
120.14(2) applications for small issue bonds for manufacturing projects; and
120.15(3) applications for small issue bonds for agricultural development bond loan
120.16projects.
120.17(c) On the first Monday in October through the last Monday in November,
120.18allocations shall be awarded from the unified pool in the following order of priority:
120.19(1) applications for student loan bonds issued by or on behalf of the Minnesota
120.20Office of Higher Education;
120.21(2) applications for mortgage bonds;
120.22(3) applications for public facility projects funded by public facility bonds;
120.23(4) applications for small issue bonds for manufacturing projects;
120.24(5) applications for small issue bonds for agricultural development bond loan
120.25projects;
120.26(6) applications for residential rental project bonds;
120.27(7) applications for enterprise zone facility bonds;
120.28(8) applications for governmental bonds; and
120.29(9) applications for redevelopment bonds.
120.30(d) If there are two or more applications for manufacturing projects from the
120.31unified pool and there is insufficient bonding authority to provide allocations for all
120.32manufacturing projects in any one allocation period, the available bonding authority shall
120.33be awarded based on the number of points awarded a project under section 474A.045
120.34with those projects receiving the greatest number of points receiving allocation first. If
120.35two or more applications for manufacturing projects receive an equal amount of points,
121.1available bonding authority shall be awarded by lot unless otherwise agreed to by the
121.2respective issuers.
121.3(e) If there are two or more applications for enterprise zone facility projects from
121.4the unified pool and there is insufficient bonding authority to provide allocations for
121.5all enterprise zone facility projects in any one allocation period, the available bonding
121.6authority shall be awarded based on the number of points awarded a project under section
121.7474A.045 with those projects receiving the greatest number of points receiving allocation
121.8first. If two or more applications for enterprise zone facility projects receive an equal
121.9amount of points, available bonding authority shall be awarded by lot unless otherwise
121.10agreed to by the respective issuers.
121.11(f) If there are two or more applications for residential rental projects from the
121.12unified pool and there is insufficient bonding authority to provide allocations for all
121.13residential rental projects in any one allocation period, the available bonding authority
121.14shall be awarded in the following order of priority: (1) projects that preserve existing
121.15federally subsidized housing; (2) projects that are not restricted to persons who are 55
121.16years of age or older; and (3) other residential rental projects.
121.17(g) From the first Monday in August through the last Monday in November,
121.18$20,000,000 of bonding authority or an amount equal to the total annual amount of
121.19bonding authority allocated to the small issue pool under section 474A.03, subdivision 1,
121.20less the amount allocated to issuers from the small issue pool for that year, whichever is
121.21less, is reserved within the unified pool for small issue bonds to the extent such amounts
121.22are available within the unified pool.
121.23(h) The total amount of allocations for mortgage bonds from the housing pool and
121.24the unified pool may not exceed:
121.25(1) $10,000,000 for any one city; or
121.26(2) $20,000,000 for any number of cities in any one county.
121.27(i) The total amount of allocations for student loan bonds from the unified pool may
121.28not exceed $10,000,000 $25,000,000 per year.
121.29(j) If there is insufficient bonding authority to fund all projects within any qualified
121.30bond category other than enterprise zone facility projects, manufacturing projects, and
121.31residential rental projects, allocations shall be awarded by lot unless otherwise agreed to
121.32by the respective issuers.
121.33(k) If an application is rejected, the commissioner must notify the applicant and
121.34return the application deposit to the applicant within 30 days unless the applicant requests
121.35in writing that the application be resubmitted.
122.1(l) The granting of an allocation of bonding authority under this section must be
122.2evidenced by issuance of a certificate of allocation.

122.3    Sec. 8. Laws 2010, chapter 216, section 3, is amended by adding a subdivision to read:
122.4    Subd. 3a. Authority. "Authority" means a housing and redevelopment authority
122.5or economic development authority created pursuant to section 469.003, 469.004, or
122.6469.091, or another entity authorized by law to exercise the powers of an authority created
122.7pursuant to one of those sections.
122.8EFFECTIVE DATE.This section is effective the day following final enactment.

122.9    Sec. 9. Laws 2010, chapter 216, section 3, is amended by adding a subdivision to read:
122.10    Subd. 3b. Implementing entity. "Implementing entity" means the local government
122.11or an authority designated by the local government by resolution to implement and
122.12administer programs described in section 216C.436.
122.13EFFECTIVE DATE.This section is effective the day following final enactment.

122.14    Sec. 10. Laws 2010, chapter 216, section 3, subdivision 6, is amended to read:
122.15    Subd. 6. Qualifying real property. "Qualifying real property" means a
122.16single-family or multifamily residential dwelling, or a commercial or industrial building,
122.17that the city implementing entity has determined, after review of an energy audit or
122.18renewable energy system feasibility study, can be benefited by installation of energy
122.19improvements.
122.20EFFECTIVE DATE.This section is effective the day following final enactment.

122.21    Sec. 11. Laws 2010, chapter 216, section 4, subdivision 1, is amended to read:
122.22    Subdivision 1. Program authority. A local government An implementing entity
122.23may establish a program to finance energy improvements to enable owners of qualifying
122.24real property to pay for cost-effective energy improvements to the qualifying real property
122.25with the net proceeds and interest earnings of revenue bonds authorized in this section.
122.26A local government An implementing entity may limit the number of qualifying real
122.27properties for which a property owner may receive program financing.
122.28EFFECTIVE DATE.This section is effective the day following final enactment.

122.29    Sec. 12. Laws 2010, chapter 216, section 4, subdivision 2, is amended to read:
123.1    Subd. 2. Program requirements. A financing program must:
123.2(1) impose requirements and conditions on financing arrangements to ensure timely
123.3repayment;
123.4(2) require an energy audit or renewable energy system feasibility study to be
123.5conducted on the qualifying real property and reviewed by the local government
123.6implementing entity prior to approval of the financing;
123.7(3) require the inspection of all installations and a performance verification of at
123.8least ten percent of the energy improvements financed by the program;
123.9(4) require that all cost-effective energy improvements be made to a qualifying
123.10real property prior to, or in conjunction with, an applicant's repayment of financing for
123.11energy improvements for that property;
123.12(5) have energy improvements financed by the program performed by licensed
123.13contractors as required by chapter 326B or other law or ordinance;
123.14(6) require disclosures to borrowers by the local government implementing entity
123.15of the risks involved in borrowing, including the risk of foreclosure if a tax delinquency
123.16results from a default;
123.17(7) provide financing only to those who demonstrate an ability to repay;
123.18(8) not provide financing for a qualifying real property in which the owner is not
123.19current on mortgage or real property tax payments;
123.20(9) require a petition to the implementing entity by all owners of the qualifying
123.21real property requesting collections of repayments as a special assessment under section
123.22429.101 ;
123.23(10) provide that payments and assessments are not accelerated due to a default and
123.24that a tax delinquency exists only for assessments not paid when due; and
123.25(11) require that liability for special assessments related to the financing runs with
123.26the qualifying real property.
123.27EFFECTIVE DATE.This section is effective the day following final enactment.

123.28    Sec. 13. Laws 2010, chapter 216, section 4, subdivision 4, is amended to read:
123.29    Subd. 4. Financing terms. Financing provided under this section must have:
123.30(1) a term not to exceed the weighted average of the useful life of the energy
123.31improvements installed, as determined by the local government implementing entity, but
123.32in no event may a term exceed 20 years;
123.33(2) a principal amount not to exceed the lesser of ten percent of the assessed value
123.34of the real property on which the improvements are to be installed or the actual cost of
123.35installing the energy improvements, including the costs of necessary equipment, materials,
124.1and labor, the costs of each related energy audit or renewable energy system feasibility
124.2study, and the cost of verification of installation; and
124.3(3) an interest rate sufficient to pay the financing costs of the program, including the
124.4issuance of bonds and any financing delinquencies.
124.5EFFECTIVE DATE.This section is effective the day following final enactment.

124.6    Sec. 14. Laws 2010, chapter 216, section 4, subdivision 6, is amended to read:
124.7    Subd. 6. Certificate of participation. Upon completion of a project, a local
124.8government an implementing entity shall provide a borrower with a certificate stating
124.9participation in the program and what energy improvements have been made with
124.10financing program proceeds.
124.11EFFECTIVE DATE.This section is effective the day following final enactment.

124.12    Sec. 15. Laws 2010, chapter 216, section 4, subdivision 7, is amended to read:
124.13    Subd. 7. Repayment. A local government financing An implementing entity that
124.14finances an energy improvement under this section must:
124.15(1) secure payment with a lien against the benefited qualifying real property; and
124.16(2) collect repayments as a special assessment as provided for in section 429.101
124.17or by charter.
124.18If the implementing entity is an authority, the local government that authorized
124.19the authority to act as implementing entity shall impose and collect special assessments
124.20necessary to pay debt service on bonds issued by the implementing entity under
124.21subdivision 8, and shall transfer all collections of the assessments upon receipt to the
124.22authority.
124.23EFFECTIVE DATE.This section is effective the day following final enactment.

124.24    Sec. 16. Laws 2010, chapter 216, section 4, subdivision 8, is amended to read:
124.25    Subd. 8. Bond issuance; repayment. (a) A local government An implementing
124.26entity may issue revenue bonds as provided in chapter 475 for the purposes of this section.
124.27(b) The bonds must be payable as to both principal and interest solely from the
124.28revenues from the assessments established in subdivision 7.
124.29(c) No holder of bonds issued under this subdivision may compel any exercise of the
124.30taxing power of the implementing entity that issued the bonds to pay principal or interest
124.31on the bonds, and if the implementing entity is an authority, no holder of the bonds may
124.32compel any exercise of the taxing power of the local government that issued the bonds
125.1to pay principal or interest on the bonds. Bonds issued under this subdivision are not
125.2a debt or obligation of the issuer or any local government that issued them, nor is the
125.3payment of the bonds enforceable out of any money other than the revenue pledged to
125.4the payment of the bonds.
125.5EFFECTIVE DATE.This section is effective the day following final enactment.

125.6    Sec. 17. CITY OF LANDFALL VILLAGE; TAX INCREMENT FINANCING
125.7DISTRICT; SPECIAL RULES.
125.8The requirement of Minnesota Statutes, section 469.1763, subdivision 3, that
125.9activities must be undertaken within a five-year period from the date of certification of
125.10a tax increment financing district, is considered to be met for Tax Increment Financing
125.11District No. 1-1 in the city of Landfall Village if the activities were undertaken within
125.12eight years from the date of certification of the district.
125.13EFFECTIVE DATE.This section is effective upon compliance by the governing
125.14body of the city of Landfall Village with the requirements of Minnesota Statutes, section
125.15645.021, subdivision 3.

125.16    Sec. 18. CITY OF WAYZATA; TAX INCREMENT FINANCING DISTRICT;
125.17SPECIAL RULES.
125.18Any parcel in Redevelopment Tax Increment Financing District No. 5 in the city
125.19of Wayzata is deemed to meet the requirements of Minnesota Statutes, section 469.174,
125.20subdivision 10, paragraph (d), clause (1), if the following conditions are met:
125.21(1) a building on the parcel was demolished by a developer or the city after the city
125.22council found the building to be structurally substandard upon approval of original tax
125.23increment financing plan for the district; and
125.24(2) the city decertifies Redevelopment Tax Increment Financing District No. 5,
125.25but files a request with the county auditor for certification of the parcel as part of a
125.26subsequent redevelopment or renewal and renovation district within ten years after the
125.27date of demolition.
125.28EFFECTIVE DATE.This section is effective upon compliance by the governing
125.29body of the city of Wayzata with the requirements of Minnesota Statutes, section 645.021,
125.30subdivision 3.


126.3    Section 1. Minnesota Statutes 2009 Supplement, section 137.025, subdivision 1,
126.4is amended to read:
126.5    Subdivision 1. Monthly payments. The commissioner of management and budget
126.6shall pay 1/12 of the annual appropriation to the University of Minnesota on by the 21st
126.725th day of each month. If the 21st 25th day of the month falls on a Saturday or Sunday,
126.8the monthly payment must be made on by the first business day immediately following
126.9the 21st 25th day of the month.

126.10    Sec. 2. Minnesota Statutes 2008, section 276.112, is amended to read:
126.11276.112 STATE PROPERTY TAXES; COUNTY TREASURER.
126.12On or before January 25 each year, for the period ending December 31 of the
126.13prior year, and on or before June 28 each year, for the period ending on the most recent
126.14settlement day determined in section 276.09, and on or before December 2 each year, for
126.15the period ending November 20 the estimated payment and settlement dates provided in
126.16this chapter for the settlement of taxes levied by school districts, the county treasurer must
126.17make full settlement with the county auditor according to sections 276.09, 276.10, and
126.18276.111 for all receipts of state property taxes levied under section 275.025, and must
126.19transmit those receipts to the commissioner of revenue by electronic means on the dates
126.20and according to the provisions applicable to distributions to school districts.
126.21EFFECTIVE DATE.This section is effective for distributions beginning October
126.221, 2010, and thereafter.

126.23    Sec. 3. Minnesota Statutes 2009 Supplement, section 289A.20, subdivision 4, is
126.24amended to read:
126.25    Subd. 4. Sales and use tax. (a) The taxes imposed by chapter 297A are due and
126.26payable to the commissioner monthly on or before the 20th day of the month following
126.27the month in which the taxable event occurred, or following another reporting period
126.28as the commissioner prescribes or as allowed under section 289A.18, subdivision 4,
126.29paragraph (f) or (g), except that:
126.30(1) use taxes due on an annual use tax return as provided under section 289A.11,
126.31subdivision 1 , are payable by April 15 following the close of the calendar year.; and
126.32(2) except as provided in paragraph (f), for a vendor having a liability of $120,000
126.33or more during a fiscal year ending June 30, 2009, and fiscal years thereafter, the taxes
127.1imposed by chapter 297A, except as provided in paragraph (b), are due and payable to the
127.2commissioner monthly in the following manner:
127.3(i) On or before the 14th day of the month following the month in which the taxable
127.4event occurred, the vendor must remit to the commissioner 90 percent of the estimated
127.5liability for the month in which the taxable event occurred.
127.6(ii) On or before the 20th day of the month following the month in which the taxable
127.7event occurred, the vendor must pay any additional amount of tax not remitted on or
127.8before the 14th day of the month following the month in which the taxable event occurred.
127.9    (b) Notwithstanding paragraph (a), a vendor having a liability of $120,000 or more
127.10during a fiscal year ending June 30 must remit the June liability for the next year in the
127.11following manner:
127.12    (1) Two business days before June 30 of the year, the vendor must remit 90 percent
127.13of the estimated June liability to the commissioner.
127.14    (2) On or before August 20 of the year, the vendor must pay any additional amount
127.15of tax not remitted in June.
127.16    (c) A vendor having a liability of:
127.17    (1) $20,000 or more in the fiscal year ending June 30, 2005; or
127.18    (2) (1) $10,000 or more in the, but less than $120,000 during a fiscal year ending
127.19June 30, 2006 2009, and fiscal years thereafter, must remit all liabilities on returns due
127.20for periods beginning in the subsequent calendar year by electronic means on or before
127.21the 20th day of the month following the month in which the taxable event occurred, or
127.22on or before the 20th day of the month following the month in which the sale is reported
127.23under section 289A.18, subdivision 4, except for 90 percent of the estimated June liability,
127.24which is due two business days before June 30. The remaining amount of the June
127.25liability is due on August 20.
127.26(2) $120,000 or more, during a fiscal year ending June 30, 2009, and fiscal years
127.27thereafter, must remit all liabilities in the manner provided in paragraph (a), clause (2), on
127.28returns due for periods beginning in the subsequent calendar year by electronic means,
127.29except for 90 percent of the estimated June liability, which is due two business days before
127.30June 30. The remaining amount of the June liability is due on August 20.
127.31(d) Notwithstanding paragraph (b) or (c), a person prohibited by the person's
127.32religious beliefs from paying electronically shall be allowed to remit the payment by mail.
127.33The filer must notify the commissioner of revenue of the intent to pay by mail before
127.34doing so on a form prescribed by the commissioner. No extra fee may be charged to a
127.35person making payment by mail under this paragraph. The payment must be postmarked
128.1at least two business days before the due date for making the payment in order to be
128.2considered paid on a timely basis.
128.3(e) Whenever the liability is $120,000 or more separately for (1) the tax imposed
128.4under chapter 297A, (2) a fee which is to be reported on the same return as and paid with
128.5the chapter 297A taxes, or (3) any other tax which is to be reported on the same return as
128.6and paid with the chapter 297A taxes, then the payment of all the liabilities on the return
128.7must be accelerated as provided in this subdivision.
128.8(f) At the start of the first calendar quarter at least 90 days after the cash flow
128.9account established in section 16A.152, subdivision 1, and the budget reserve account
128.10established in section 16A.152, subdivision 1a, reach the amounts listed in section
128.1116A.152, subdivision 2, paragraph (a), the remittance of estimated sales tax collections
128.12by the 14th day of a month required under paragraph (a), clause (2), shall be suspended.
128.13The commissioner of management and budget shall notify the commissioner of revenue
128.14when the accounts have reached the required amounts. Beginning with the suspension
128.15of paragraph (a), clause (2), for a vendor with a liability of $120,000 or more during a
128.16fiscal year ending June 30, 2009, and fiscal years thereafter, the taxes imposed by chapter
128.17297A are due and payable to the commissioner on the 20th day of the month following the
128.18month in which the taxable event occurred. Payments of tax liabilities for taxable events
128.19occurring in June under paragraph (b) are not changed.
128.20EFFECTIVE DATE.This section is effective for taxes due and payable after
128.21September 1, 2010.

128.22    Sec. 4. Minnesota Statutes 2008, section 289A.60, is amended by adding a subdivision
128.23to read:
128.24    Subd. 31. Accelerated payment of monthly sales tax liability; penalty for
128.25underpayment. For payments made after September 1, 2010, if a vendor is required by
128.26section 289A.20, subdivision 4, to remit a 90 percent payment by the 14th of the month
128.27following the month in which the taxable event occurred, as an estimation of monthly
128.28sales tax liabilities, including the liability of any fee or other tax which is to be reported
128.29on the same return as and paid with the chapter 297A taxes, for the month in which the
128.30taxable event occurred, the vendor shall pay a penalty equal to ten percent of the amount of
128.31liability that was required to be paid by the 14th of the month less the amount remitted by
128.32the 14th of the month. The penalty must not be imposed, however, if the amount remitted
128.33by the 14th of the month equals the lesser of (1) 90 percent of the liability for the month
128.34preceding the month in which the taxable event occurred, (2) 90 percent of the liability
129.1of the same month in the previous calendar year as the month in which the taxable event
129.2occurred, or (3) 90 percent of the average monthly liability for the previous calendar year.
129.3EFFECTIVE DATE.This section is effective for taxes due and payable after
129.4September 1, 2010.


129.7    Section 1. Minnesota Statutes 2009 Supplement, section 134.34, subdivision 4, is
129.8amended to read:
129.9    Subd. 4. Limitation. (a) For calendar year 2010 and later, a regional library
129.10basic system support grant shall not be made to a regional public library system for a
129.11participating city or county which decreases the dollar amount provided for support for
129.12operating purposes of public library service below the amount provided by it for the
129.13second, or third preceding year, whichever is less. For purposes of this subdivision and
129.14subdivision 1, any funds provided under section 473.757, subdivision 2, for extending
129.15library hours of operation shall not be considered amounts provided by a city or county for
129.16support for operating purposes of public library service. This subdivision shall not apply
129.17to participating cities or counties where the adjusted net tax capacity of that city or county
129.18has decreased, if the dollar amount of the reduction in support is not greater than the dollar
129.19amount by which support would be decreased if the reduction in support were made in
129.20direct proportion to the decrease in adjusted net tax capacity.
129.21(b) For calendar year 2009 and later, in any calendar year in which a city's or
129.22county's aid under sections 477A.011 to 477A.014 or credits credit reimbursement under
129.23section 273.1384 is reduced after the city or county has certified its levy payable in that
129.24year, it may reduce its local support by the lesser of:
129.25(1) ten percent; or
129.26(2) a percent equal to the ratio of the aid and credit reimbursement reductions to the
129.27city's or county's revenue base, based on aids certified for the current calendar year. For
129.28calendar year 2009 only, the reduction under this paragraph shall be based on 2008 aid and
129.29credit reimbursement reductions under the December 2008 unallotment, as well as any
129.30aid and credit reimbursement reductions in calendar year 2009. For pay 2009 only, the
129.31commissioner of revenue will calculate the reductions under this paragraph and certify
129.32them to the commissioner of education within 15 days of May 17, 2009.
129.33(c) For taxes payable in 2010 and later, in any payable year in which the total
129.34amounts certified for city or county aids under sections 477A.011 to 477A.014 are less
130.1than the total amounts paid under those sections in the previous calendar year, a city or
130.2county may reduce its local support by the lesser of:
130.3(1) ten percent; or
130.4(2) a percent equal to the ratio of:
130.5(i) the difference between (A) the sum of the aid it was paid under sections 477A.011
130.6to 477A.014 and the credits credit reimbursement it received under section 273.1398
130.7273.1384 in the previous calendar year and (B) the sum of the aid it is certified to be paid
130.8in the current calendar year under sections 477A.011 to 477A.014 and the credits credit
130.9reimbursement estimated to be paid under section 273.1398 273.1384; to
130.10(ii) its revenue base for the previous year, based on aids actually paid in the previous
130.11calendar year. The commissioner of revenue shall calculate the percent aid cut for each
130.12county and city under this paragraph and certify the percentage cuts to the commissioner
130.13of education by August 1 of the year prior to the year in which the reduced aids and credits
130.14credit reimbursements are to be paid. The percentage of reduction related to reductions to
130.15credits credit reimbursements under section 273.1384 shall be based on the best estimation
130.16available as of July 30.
130.17(d) Notwithstanding paragraph (a), (b), or (c), no city or county shall reduce its
130.18support for public libraries below the minimum level specified in subdivision 1.
130.19(e) For purposes of this subdivision, "revenue base" means the sum of:
130.20(1) its levy for taxes payable in the current calendar year, including the levy on
130.21the fiscal disparities distribution under section 276A.06, subdivision 3, paragraph (a),
130.22or 473F.08, subdivision 3, paragraph (a);
130.23(2) its aid under sections 477A.011 to 477A.014 in the current calendar year; and
130.24(3) its taconite aid in the current calendar year under sections 298.28 and 298.282.
130.25EFFECTIVE DATE.This section is effective retroactively for support in calendar
130.26year 2009 and thereafter and for library grants paid in fiscal year 2010 and thereafter.

130.27    Sec. 2. Minnesota Statutes 2008, section 270C.87, is amended to read:
130.28270C.87 REVISION OF MINNESOTA ASSESSORS' MANUAL.
130.29In accordance with the provisions of section 270C.06 270C.85, the commissioner
130.30shall periodically revise the Minnesota assessors' manual.
130.31EFFECTIVE DATE.This section is effective the day following final enactment.

130.32    Sec. 3. Minnesota Statutes 2008, section 270C.94, subdivision 3, is amended to read:
131.1    Subd. 3. Failure to appraise. When an assessor has failed to properly appraise at
131.2least one-fifth of the parcels of property in a district or county as provided in section
131.3273.01 , the commissioner shall may appoint a special assessor and deputy assessor
131.4as necessary and cause a reappraisal to be made of the property due for reassessment
131.5in accordance with law.
131.6EFFECTIVE DATE.This section is effective the day following final enactment.

131.7    Sec. 4. Minnesota Statutes 2008, section 272.025, subdivision 1, is amended to read:
131.8    Subdivision 1. Statement of exemption. (a) Except in the case of churches and
131.9houses of worship, property solely used for educational purposes by academies, colleges,
131.10universities or seminaries of learning, property owned by the state of Minnesota or any
131.11political subdivision thereof, and property exempt from taxation under section 272.02,
131.12subdivisions 9, 10, 13, 15, 18, 20, and 22 to 26 25, and at the times provided in subdivision
131.133, a taxpayer claiming an exemption from taxation on property described in section
131.14272.02, subdivisions 1 to 33 , shall must file a statement of exemption with the assessor of
131.15the assessment district in which the property is located.
131.16(b) A taxpayer claiming an exemption from taxation on property described in section
131.17272.02, subdivision 10 , shall must file a statement of exemption with the commissioner
131.18of revenue, on or before February 15 of each year for which the taxpayer claims an
131.19exemption.
131.20(c) In case of sickness, absence or other disability or for good cause, the assessor
131.21or the commissioner may extend the time for filing the statement of exemption for a
131.22period not to exceed 60 days.
131.23(d) The commissioner of revenue shall prescribe the form and contents of the
131.24statement of exemption.
131.25EFFECTIVE DATE.This section is effective for taxes payable in 2012 and
131.26thereafter.

131.27    Sec. 5. Minnesota Statutes 2008, section 272.025, subdivision 3, is amended to read:
131.28    Subd. 3. Filing dates. (a) The statement required by subdivision 1, paragraph
131.29(a), must be filed with the assessor by February 1 of the assessment year, however, any
131.30taxpayer who has filed the statement required by subdivision 1 more than 12 months prior
131.31to February 1, 1983, or February 1 of each third year after 1983, shall file a statement by
131.32February 1, 1983, and by February 1 of each third year thereafter.
132.1(b) For churches and houses of worship, and property solely used for educational
132.2purposes by academies, colleges, universities, or seminaries of learning, no statement is
132.3required after the statement filed for the assessment year in which the exemption began.
132.4(c) This section does not apply to existing churches and houses of worship, and
132.5property solely used for educational purposes by academies, colleges, universities, or
132.6seminaries of learning that were exempt for taxes payable in 2011.
132.7EFFECTIVE DATE.This section is effective for taxes payable in 2012 and
132.8thereafter.

132.9    Sec. 6. Minnesota Statutes 2008, section 272.029, subdivision 4, is amended to read:
132.10    Subd. 4. Reports. (a) An owner of a wind energy conversion system subject to tax
132.11under subdivision 3 shall file a report with the commissioner of revenue annually on or
132.12before February 1 detailing the amount of electricity in kilowatt-hours that was produced
132.13by the wind energy conversion system for the previous calendar year. The commissioner
132.14shall prescribe the form of the report. The report must contain the information required
132.15by the commissioner to determine the tax due to each county under this section for the
132.16current year. If an owner of a wind energy conversion system subject to taxation under
132.17this section fails to file the report by the due date, the commissioner of revenue shall
132.18determine the tax based upon the nameplate capacity of the system multiplied by a
132.19capacity factor of 40 60 percent.
132.20(b) On or before February 28, the commissioner of revenue shall notify the owner of
132.21the wind energy conversion systems of the tax due to each county for the current year and
132.22shall certify to the county auditor of each county in which the systems are located the tax
132.23due from each owner for the current year.
132.24EFFECTIVE DATE.This section is effective beginning with reports due on
132.25February 1, 2011, and thereafter.

132.26    Sec. 7. Minnesota Statutes 2008, section 272.029, subdivision 7, is amended to read:
132.27    Subd. 7. Exemption. The tax imposed under this section does not apply to
132.28electricity produced by wind energy conversion systems located in a job opportunity
132.29building zone, designated under section 469.314, for the duration of the zone. The
132.30exemption applies beginning for the first calendar year after designation of the zone
132.31and applies to each calendar year that begins during the designation of the zone. The
132.32exemption only applies if the owner of the system is a qualified business under section
133.1469.310, subdivision 11, who has entered into a business subsidy agreement that covers
133.2the land on which the system is situated.
133.3EFFECTIVE DATE.This section is effective the day following final enactment.

133.4    Sec. 8. Minnesota Statutes 2008, section 273.113, subdivision 3, is amended to read:
133.5    Subd. 3. Reimbursement for lost revenue. The county auditor shall certify
133.6to the commissioner of revenue, as part of the abstracts of tax lists required to be filed
133.7with the commissioner under section 275.29, the amount of tax lost to the county from
133.8the property tax credit under subdivision 2. Any prior year adjustments must also be
133.9certified in the abstracts of tax lists. The commissioner of revenue shall review the
133.10certifications to determine their accuracy. The commissioner may make the changes
133.11in the certification that are considered necessary or return a certification to the county
133.12auditor for corrections. The commissioner shall reimburse each taxing district, other than
133.13school districts, for the taxes lost. The payments must be made at the time provided in
133.14section 473H.10 for payment to taxing jurisdictions in the same proportion that the ad
133.15valorem tax is distributed. Reimbursements to school districts must be made as provided
133.16in section 273.1392. The amount necessary to make the reimbursements under this section
133.17is annually appropriated from the general fund to the commissioner of revenue.
133.18EFFECTIVE DATE.This section is effective retroactively for taxes payable in
133.192009 and thereafter.

133.20    Sec. 9. Minnesota Statutes 2009 Supplement, section 273.114, subdivision 2, is
133.21amended to read:
133.22    Subd. 2. Requirements. Class 2a or 2b property that had been assessed under
133.23Minnesota Statutes 2006, section 273.111, or that is part of an agricultural homestead
133.24under Minnesota Statutes, section 273.13, subdivision 23, paragraph (a), is entitled to
133.25valuation and tax deferment under this section if:
133.26(1) the land consists of at least ten acres;
133.27(2) a conservation management plan for the land must be prepared by an approved
133.28plan writer and implemented during the period in which the land is subject to valuation
133.29and deferment under this section;
133.30(3) the land must be enrolled for a minimum of ten years; and
133.31(4) there are no delinquent property taxes on the land.; and
134.1Real estate may (5) the property is not be also enrolled for valuation and deferment
134.2under this section and section 273.111, or 273.112, or 273.117, or chapter 290C,
134.3concurrently or 473H.
134.4EFFECTIVE DATE.This section is effective the day following final enactment.

134.5    Sec. 10. Minnesota Statutes 2008, section 273.1392, is amended to read:
134.6273.1392 PAYMENT; SCHOOL DISTRICTS.
134.7The amounts of bovine tuberculosis credit reimbursements under section 273.113;
134.8conservation tax credits under section 273.119; disaster or emergency reimbursement
134.9under sections 273.1231 to 273.1235; homestead and agricultural credits under section
134.10273.1384 ; aids and credits under section 273.1398; wetlands reimbursement under
134.11section 275.295; enterprise zone property credit payments under section 469.171; and
134.12metropolitan agricultural preserve reduction under section 473H.10 for school districts,
134.13shall be certified to the Department of Education by the Department of Revenue. The
134.14amounts so certified shall be paid according to section 127A.45, subdivisions 9 and 13.
134.15EFFECTIVE DATE.This section is effective retroactively for taxes payable in
134.162009 and thereafter.

134.17    Sec. 11. Minnesota Statutes 2009 Supplement, section 275.065, subdivision 3, is
134.18amended to read:
134.19    Subd. 3. Notice of proposed property taxes. (a) The county auditor shall prepare
134.20and the county treasurer shall deliver after November 10 and on or before November 24
134.21each year, by first class mail to each taxpayer at the address listed on the county's current
134.22year's assessment roll, a notice of proposed property taxes. Upon written request by
134.23the taxpayer, the treasurer may send the notice in electronic form or by electronic mail
134.24instead of on paper or by ordinary mail.
134.25    (b) The commissioner of revenue shall prescribe the form of the notice.
134.26    (c) The notice must inform taxpayers that it contains the amount of property taxes
134.27each taxing authority proposes to collect for taxes payable the following year. In the
134.28case of a town, or in the case of the state general tax, the final tax amount will be its
134.29proposed tax. The notice must clearly state for each city that has a population over 500,
134.30county, school district, regional library authority established under section 134.201, and
134.31metropolitan taxing districts as defined in paragraph (i), the time and place of the a meeting
134.32for each taxing authorities' regularly scheduled meetings authority in which the budget
134.33and levy will be discussed and public input allowed, prior to the final budget and levy
135.1determined, which must occur after November 24 determination. The taxing authorities
135.2must provide the county auditor with the information to be included in the notice on or
135.3before the time it certifies its proposed levy under subdivision 1. The public must be
135.4allowed to speak at the meetings and the meetings shall that meeting, which must occur
135.5after November 24 and must not be held before 6:00 p.m. It must provide a telephone
135.6number for the taxing authority that taxpayers may call if they have questions related to
135.7the notice and an address where comments will be received by mail.
135.8    (d) The notice must state for each parcel:
135.9    (1) the market value of the property as determined under section 273.11, and used
135.10for computing property taxes payable in the following year and for taxes payable in the
135.11current year as each appears in the records of the county assessor on November 1 of the
135.12current year; and, in the case of residential property, whether the property is classified as
135.13homestead or nonhomestead. The notice must clearly inform taxpayers of the years to
135.14which the market values apply and that the values are final values;
135.15    (2) the items listed below, shown separately by county, city or town, and state general
135.16tax, net of the residential and agricultural homestead credit under section 273.1384, voter
135.17approved school levy, other local school levy, and the sum of the special taxing districts,
135.18and as a total of all taxing authorities:
135.19    (i) the actual tax for taxes payable in the current year; and
135.20    (ii) the proposed tax amount.
135.21    If the county levy under clause (2) includes an amount for a lake improvement
135.22district as defined under sections 103B.501 to 103B.581, the amount attributable for that
135.23purpose must be separately stated from the remaining county levy amount.
135.24    In the case of a town or the state general tax, the final tax shall also be its proposed
135.25tax unless the town changes its levy at a special town meeting under section 365.52. If a
135.26school district has certified under section 126C.17, subdivision 9, that a referendum will
135.27be held in the school district at the November general election, the county auditor must
135.28note next to the school district's proposed amount that a referendum is pending and that, if
135.29approved by the voters, the tax amount may be higher than shown on the notice. In the
135.30case of the city of Minneapolis, the levy for Minneapolis Park and Recreation shall be
135.31listed separately from the remaining amount of the city's levy. In the case of the city of
135.32St. Paul, the levy for the St. Paul Library Agency must be listed separately from the
135.33remaining amount of the city's levy. In the case of Ramsey County, any amount levied
135.34under section 134.07 may be listed separately from the remaining amount of the county's
135.35levy. In the case of a parcel where tax increment or the fiscal disparities areawide tax
135.36under chapter 276A or 473F applies, the proposed tax levy on the captured value or the
136.1proposed tax levy on the tax capacity subject to the areawide tax must each be stated
136.2separately and not included in the sum of the special taxing districts; and
136.3    (3) the increase or decrease between the total taxes payable in the current year and
136.4the total proposed taxes, expressed as a percentage.
136.5    For purposes of this section, the amount of the tax on homesteads qualifying under
136.6the senior citizens' property tax deferral program under chapter 290B is the total amount
136.7of property tax before subtraction of the deferred property tax amount.
136.8    (e) The notice must clearly state that the proposed or final taxes do not include
136.9the following:
136.10    (1) special assessments;
136.11    (2) levies approved by the voters after the date the proposed taxes are certified,
136.12including bond referenda and school district levy referenda;
136.13    (3) a levy limit increase approved by the voters by the first Tuesday after the first
136.14Monday in November of the levy year as provided under section 275.73;
136.15    (4) amounts necessary to pay cleanup or other costs due to a natural disaster
136.16occurring after the date the proposed taxes are certified;
136.17    (5) amounts necessary to pay tort judgments against the taxing authority that become
136.18final after the date the proposed taxes are certified; and
136.19    (6) the contamination tax imposed on properties which received market value
136.20reductions for contamination.
136.21    (f) Except as provided in subdivision 7, failure of the county auditor to prepare or
136.22the county treasurer to deliver the notice as required in this section does not invalidate the
136.23proposed or final tax levy or the taxes payable pursuant to the tax levy.
136.24    (g) If the notice the taxpayer receives under this section lists the property as
136.25nonhomestead, and satisfactory documentation is provided to the county assessor by the
136.26applicable deadline, and the property qualifies for the homestead classification in that
136.27assessment year, the assessor shall reclassify the property to homestead for taxes payable
136.28in the following year.
136.29    (h) In the case of class 4 residential property used as a residence for lease or rental
136.30periods of 30 days or more, the taxpayer must either:
136.31    (1) mail or deliver a copy of the notice of proposed property taxes to each tenant,
136.32renter, or lessee; or
136.33    (2) post a copy of the notice in a conspicuous place on the premises of the property.
136.34    The notice must be mailed or posted by the taxpayer by November 27 or within
136.35three days of receipt of the notice, whichever is later. A taxpayer may notify the county
137.1treasurer of the address of the taxpayer, agent, caretaker, or manager of the premises to
137.2which the notice must be mailed in order to fulfill the requirements of this paragraph.
137.3    (i) For purposes of this subdivision and subdivision 6, "metropolitan special taxing
137.4districts" means the following taxing districts in the seven-county metropolitan area that
137.5levy a property tax for any of the specified purposes listed below:
137.6    (1) Metropolitan Council under section 473.132, 473.167, 473.249, 473.325,
137.7473.446 , 473.521, 473.547, or 473.834;
137.8    (2) Metropolitan Airports Commission under section 473.667, 473.671, or 473.672;
137.9and
137.10    (3) Metropolitan Mosquito Control Commission under section 473.711.
137.11    For purposes of this section, any levies made by the regional rail authorities in the
137.12county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter
137.13398A shall be included with the appropriate county's levy.
137.14    (j) The governing body of a county, city, or school district may, with the consent
137.15of the county board, include supplemental information with the statement of proposed
137.16property taxes about the impact of state aid increases or decreases on property tax
137.17increases or decreases and on the level of services provided in the affected jurisdiction.
137.18This supplemental information may include information for the following year, the current
137.19year, and for as many consecutive preceding years as deemed appropriate by the governing
137.20body of the county, city, or school district. It may include only information regarding:
137.21    (1) the impact of inflation as measured by the implicit price deflator for state and
137.22local government purchases;
137.23    (2) population growth and decline;
137.24    (3) state or federal government action; and
137.25    (4) other financial factors that affect the level of property taxation and local services
137.26that the governing body of the county, city, or school district may deem appropriate to
137.27include.
137.28    The information may be presented using tables, written narrative, and graphic
137.29representations and may contain instruction toward further sources of information or
137.30opportunity for comment.
137.31EFFECTIVE DATE.This section is effective retroactively for taxes payable in
137.322010 and thereafter.

137.33    Sec. 12. Minnesota Statutes 2009 Supplement, section 275.70, subdivision 5, as
137.34amended by Laws 2010, chapter 215, article 13, section 3, is amended to read:
138.1    Subd. 5. Special levies. "Special levies" means those portions of ad valorem taxes
138.2levied by a local governmental unit for the following purposes or in the following manner:
138.3    (1) to pay the costs of the principal and interest on bonded indebtedness or to
138.4reimburse for the amount of liquor store revenues used to pay the principal and interest
138.5due on municipal liquor store bonds in the year preceding the year for which the levy
138.6limit is calculated;
138.7    (2) to pay the costs of principal and interest on certificates of indebtedness issued for
138.8any corporate purpose except for the following:
138.9    (i) tax anticipation or aid anticipation certificates of indebtedness;
138.10    (ii) certificates of indebtedness issued under sections 298.28 and 298.282;
138.11    (iii) certificates of indebtedness used to fund current expenses or to pay the costs of
138.12extraordinary expenditures that result from a public emergency; or
138.13    (iv) certificates of indebtedness used to fund an insufficiency in tax receipts or an
138.14insufficiency in other revenue sources, provided that nothing in this subdivision limits the
138.15special levy authorized under section 475.755;
138.16    (3) to provide for the bonded indebtedness portion of payments made to another
138.17political subdivision of the state of Minnesota;
138.18    (4) to fund payments made to the Minnesota State Armory Building Commission
138.19under section 193.145, subdivision 2, to retire the principal and interest on armory
138.20construction bonds;
138.21    (5) property taxes approved by voters which are levied against the referendum
138.22market value as provided under section 275.61;
138.23    (6) to fund matching requirements needed to qualify for federal or state grants or
138.24programs to the extent that either (i) the matching requirement exceeds the matching
138.25requirement in calendar year 2001, or (ii) it is a new matching requirement that did not
138.26exist prior to 2002;
138.27    (7) to pay the expenses reasonably and necessarily incurred in preparing for or
138.28repairing the effects of natural disaster including the occurrence or threat of widespread
138.29or severe damage, injury, or loss of life or property resulting from natural causes, in
138.30accordance with standards formulated by the Emergency Services Division of the state
138.31Department of Public Safety, as allowed by the commissioner of revenue under section
138.32275.74, subdivision 2 ;
138.33    (8) pay amounts required to correct an error in the levy certified to the county
138.34auditor by a city or county in a levy year, but only to the extent that when added to the
138.35preceding year's levy it is not in excess of an applicable statutory, special law or charter
139.1limitation, or the limitation imposed on the governmental subdivision by sections 275.70
139.2to 275.74 in the preceding levy year;
139.3    (9) to pay an abatement under section 469.1815;
139.4    (10) to pay any costs attributable to increases in the employer contribution rates
139.5under chapter 353, or locally administered pension plans, that are effective after June
139.630, 2001;
139.7    (11) to pay the operating or maintenance costs of a county jail as authorized in
139.8section 641.01 or 641.262, or of a correctional facility as defined in section 241.021,
139.9subdivision 1 , paragraph (f), to the extent that the county can demonstrate to the
139.10commissioner of revenue that the amount has been included in the county budget as
139.11a direct result of a rule, minimum requirement, minimum standard, or directive of the
139.12Department of Corrections, or to pay the operating or maintenance costs of a regional jail
139.13as authorized in section 641.262. For purposes of this clause, a district court order is
139.14not a rule, minimum requirement, minimum standard, or directive of the Department of
139.15Corrections. If the county utilizes this special levy, except to pay operating or maintenance
139.16costs of a new regional jail facility under sections 641.262 to 641.264 which will not
139.17replace an existing jail facility, any amount levied by the county in the previous levy year
139.18for the purposes specified under this clause and included in the county's previous year's
139.19levy limitation computed under section 275.71, shall be deducted from the levy limit
139.20base under section 275.71, subdivision 2, when determining the county's current year
139.21levy limitation. The county shall provide the necessary information to the commissioner
139.22of revenue for making this determination;
139.23    (12) to pay for operation of a lake improvement district, as authorized under section
139.24103B.555 . If the county utilizes this special levy, any amount levied by the county in the
139.25previous levy year for the purposes specified under this clause and included in the county's
139.26previous year's levy limitation computed under section 275.71 shall be deducted from
139.27the levy limit base under section 275.71, subdivision 2, when determining the county's
139.28current year levy limitation. The county shall provide the necessary information to the
139.29commissioner of revenue for making this determination;
139.30    (13) to repay a state or federal loan used to fund the direct or indirect required
139.31spending by the local government due to a state or federal transportation project or other
139.32state or federal capital project. This authority may only be used if the project is not a
139.33local government initiative;
139.34    (14) to pay for court administration costs as required under section 273.1398,
139.35subdivision 4b , less the (i) county's share of transferred fines and fees collected by the
139.36district courts in the county for calendar year 2001 and (ii) the aid amount certified to be
140.1paid to the county in 2004 under section 273.1398, subdivision 4c; however, for taxes
140.2levied to pay for these costs in the year in which the court financing is transferred to the
140.3state, the amount under this clause is limited to the amount of aid the county is certified to
140.4receive under section 273.1398, subdivision 4a;
140.5    (15) to fund a police or firefighters relief association as required under section 69.77
140.6to the extent that the required amount exceeds the amount levied for this purpose in 2001;
140.7    (16) for purposes of a storm sewer improvement district under section 444.20;
140.8    (17) to pay for the maintenance and support of a city or county society for the
140.9prevention of cruelty to animals under section 343.11, but not to exceed in any year
140.10$4,800 or the sum of $1 per capita based on the county's or city's population as of the most
140.11recent federal census, whichever is greater. If the city or county uses this special levy, any
140.12amount levied by the city or county in the previous levy year for the purposes specified
140.13in this clause and included in the city's or county's previous year's levy limit computed
140.14under section 275.71, must be deducted from the levy limit base under section 275.71,
140.15subdivision 2 , in determining the city's or county's current year levy limit;
140.16    (18) for counties, to pay for the increase in their share of health and human service
140.17costs caused by reductions in federal health and human services grants effective after
140.18September 30, 2007;
140.19    (19) for a city, for the costs reasonably and necessarily incurred for securing,
140.20maintaining, or demolishing foreclosed or abandoned residential properties, as allowed by
140.21the commissioner of revenue under section 275.74, subdivision 2. A city must have either
140.22(i) a foreclosure rate of at least 1.4 percent in 2007, or (ii) a foreclosure rate in 2007 in
140.23the city or in a zip code area of the city that is at least 50 percent higher than the average
140.24foreclosure rate in the metropolitan area, as defined in section 473.121, subdivision 2,
140.25to use this special levy. For purposes of this paragraph, "foreclosure rate" means the
140.26number of foreclosures, as indicated by sheriff sales records, divided by the number of
140.27households in the city in 2007;
140.28    (20) for a city, for the unreimbursed costs of redeployed traffic-control agents and
140.29lost traffic citation revenue due to the collapse of the Interstate 35W bridge, as certified
140.30to the Federal Highway Administration;
140.31    (21) to pay costs attributable to wages and benefits for sheriff, police, and fire
140.32personnel. If a local governmental unit did not use this special levy in the previous year its
140.33levy limit base under section 275.71 shall be reduced by the amount equal to the amount it
140.34levied for the purposes specified in this clause in the previous year;
140.35    (22) an amount equal to any reductions in the certified aids or credits credit
140.36reimbursements payable under sections 477A.011 to 477A.014, and section 273.1384, due
141.1to unallotment under section 16A.152 or reductions under another provision of law. The
141.2amount of the levy allowed under this clause for each year is equal limited to the amount
141.3unallotted or reduced in from the aids and credit reimbursements certified for payment in
141.4the year following the calendar year in which the tax levy is levied certified unless the
141.5unallotment or reduction amount is not known by September 1 of the levy certification
141.6year, and the local government has not adjusted its levy under section 275.065, subdivision
141.76 , or 275.07, subdivision 6, in which case the that unallotment or reduction amount may
141.8be levied in the following year;
141.9(23) to pay for the difference between one-half of the costs of confining sex offenders
141.10undergoing the civil commitment process and any state payments for this purpose pursuant
141.11to section 253B.185, subdivision 5;
141.12(24) for a county to pay the costs of the first year of maintaining and operating a new
141.13facility or new expansion, either of which contains courts, corrections, dispatch, criminal
141.14investigation labs, or other public safety facilities and for which all or a portion of the
141.15funding for the site acquisition, building design, site preparation, construction, and related
141.16equipment was issued or authorized prior to the imposition of levy limits in 2008. The
141.17levy limit base shall then be increased by an amount equal to the new facility's first full
141.18year's operating costs as described in this clause; and
141.19(25) for the estimated amount of reduction to market value credit reimbursements
141.20under section 273.1384 for credits payable in the year in which the levy is payable.
141.21EFFECTIVE DATE.This section is effective retroactively for taxes payable in
141.222010 and thereafter.

141.23    Sec. 13. Minnesota Statutes 2008, section 275.71, subdivision 5, is amended to read:
141.24    Subd. 5. Property tax levy limit. (a) For taxes levied in 2008 through 2010, the
141.25property tax levy limit for a local governmental unit is equal to its adjusted levy limit
141.26base determined under subdivision 4 plus any additional levy authorized under section
141.27275.73 , which is levied against net tax capacity, reduced by the sum of (i) the total amount
141.28of aids and reimbursements that the local governmental unit is certified to receive under
141.29sections 477A.011 to 477A.014, (ii) taconite aids under sections 298.28 and 298.282
141.30including any aid which was required to be placed in a special fund for expenditure in
141.31the next succeeding year, (iii) estimated payments to the local governmental unit under
141.32section 272.029, adjusted for any error in estimation in the preceding year, and (iv) aids
141.33under section 477A.16.
141.34(b) If an aid, payment, or other amount used in paragraph (a) to reduce a local
141.35government unit's levy limit is reduced by an unallotment under section 16A.152, the
142.1amount of the aid, payment, or other amount prior to the unallotment is used in the
142.2computations in paragraph (a). In order for a local government unit to levy outside of its
142.3limit to offset the reduction in revenues attributable to an unallotment, it must do so under,
142.4and to the extent authorized by, a special levy authorization.
142.5EFFECTIVE DATE.This section is effective retroactively for taxes payable in
142.62010 and thereafter.

142.7    Sec. 14. Minnesota Statutes 2008, section 279.01, subdivision 3, is amended to read:
142.8    Subd. 3. Agricultural property. In the case of class 1b agricultural homestead, and
142.9class 2a agricultural homestead and 2b property, and class 2b(3) agricultural nonhomestead
142.10property, no penalties shall attach to the second one-half property tax payment as provided
142.11in this section if paid by November 15. Thereafter for class 1b agricultural homestead and
142.12class 2a and 2b homestead property, on November 16 following, a penalty of six percent
142.13shall accrue and be charged on all such unpaid taxes and on December 1 following, an
142.14additional two percent shall be charged on all such unpaid taxes. Thereafter for class 2b(3)
142.15agricultural 2a and 2b nonhomestead property, on November 16 following, a penalty of
142.16eight percent shall accrue and be charged on all such unpaid taxes and on December 1
142.17following, an additional four percent shall be charged on all such unpaid taxes.
142.18If the owner of class 1b agricultural homestead, or class 2a, or class 2b(3)
142.19agricultural or 2b property receives a consolidated property tax statement that shows
142.20only an aggregate of the taxes and special assessments due on that property and on other
142.21property not classified as class 1b agricultural homestead, or class 2a, or class 2b(3)
142.22agricultural or 2b property, the aggregate tax and special assessments shown due on the
142.23property by the consolidated statement will be due on November 15.
142.24EFFECTIVE DATE.This section is effective for taxes payable in 2011 and
142.25thereafter.

142.26    Sec. 15. Minnesota Statutes 2008, section 279.37, subdivision 1, is amended to read:
142.27    Subdivision 1. Composition into one item. Delinquent taxes upon any parcel of real
142.28estate may be composed into one item or amount by confession of judgment at any time
142.29prior to the forfeiture of the parcel of land to the state for taxes, for the aggregate amount
142.30of all the taxes, costs, penalties, and interest accrued against the parcel, as provided in this
142.31section. Taxes upon property which, for the previous year's assessment, was classified
142.32as mineral property, employment property, or commercial or industrial property are only
142.33eligible to be composed into any confession of judgment under this section as provided in
143.1subdivision 1a. Delinquent taxes for property that has been reclassified from 4bb to 4b
143.2under section 273.1319 may not be composed into a confession of judgment under this
143.3subdivision. Delinquent taxes on unimproved land are eligible to be composed into a
143.4confession of judgment only if the land is classified under section 273.13 as homestead,
143.5agricultural, or timberland rural vacant land, or managed forest land, in the previous year
143.6or is eligible for installment payment under subdivision 1a. The entire parcel is eligible
143.7for the ten-year installment plan as provided in subdivision 2 if 25 percent or more of the
143.8market value of the parcel is eligible for confession of judgment under this subdivision.
143.9EFFECTIVE DATE.This section is effective the day following final enactment.

143.10    Sec. 16. Minnesota Statutes 2009 Supplement, section 475.755, is amended to read:
143.11475.755 EMERGENCY DEBT CERTIFICATES.
143.12(a) If at any time during a fiscal year the receipts of a local government are
143.13reasonably expected to be reduced below the amount provided in the local government's
143.14budget when the final property tax levy to be collected during the fiscal year was certified
143.15and the receipts are insufficient to meet the expenses incurred or to be incurred during the
143.16fiscal year, the governing body of the local government may authorize and sell certificates
143.17of indebtedness to mature within two years or less from the end of the fiscal year in which
143.18the certificates are issued. The maximum principal amount of the certificates that it may
143.19issue in a fiscal year is limited to the expected reduction in receipts plus the cost of
143.20issuance. The certificates may be issued in the manner and on the terms the governing
143.21body determines by resolution.
143.22(b) The governing body of the local government shall levy taxes for the payment of
143.23principal and interest on the certificates in accordance with section 475.61.
143.24(c) The certificates are not to be included in the net debt of the issuing local
143.25government.
143.26    (d) To the extent that a local government issues certificates under this section to fund
143.27an unallotment or other reduction in its state aid, the local government may must not use a
143.28the special levy authority for the aid reduction reductions under section 275.70, subdivision
143.295 , clause (22), or a similar or successor provision. This provision does not affect the status
143.30of the, but must instead use the special levy authority for the repayment of indebtedness
143.31under section 275.70, subdivision 5, clause (2), in order to levy under section 475.61 to
143.32pay fund repayment of the certificates as with a levy that is not subject to levy limits.
143.33(e) For purposes of this section, the following terms have the meanings given:
144.1(1) "Local government" means a statutory or home rule charter city, a town, or
144.2a county.
144.3(2) "Receipts" includes the following amounts scheduled to be received by the
144.4local government for the fiscal year from:
144.5(i) taxes;
144.6(ii) aid payments previously certified by the state to be paid to the local government;
144.7(iii) state reimbursement payments for property tax credits; and
144.8(iv) any other source.
144.9EFFECTIVE DATE.This section is effective retroactively for taxes payable in
144.102010 and thereafter.

144.11    Sec. 17. Minnesota Statutes 2009 Supplement, section 477A.013, subdivision 8,
144.12is amended to read:
144.13    Subd. 8. City formula aid. (a) In calendar year 2009, the formula aid for a city
144.14is equal to the sum of (1) its city jobs base, (2) its small city aid base, and (3) the need
144.15increase percentage multiplied by its unmet need.
144.16    (b) In calendar year 2010 and subsequent years, The formula aid for a city is equal
144.17to the sum of (1) its city jobs base, (2) its small city aid base, and (3) the need increase
144.18percentage multiplied by the average of its unmet need for the most recently available
144.19two years.
144.20No city may have a formula aid amount less than zero. The need increase percentage
144.21must be the same for all cities.
144.22    The applicable need increase percentage must be calculated by the Department of
144.23Revenue so that the total of the aid under subdivision 9 equals the total amount available
144.24for aid under section 477A.03. For aids payable in 2009 only, all data used in calculating
144.25aid to cities under sections 477A.011 to 477A.013 will be based on the data available for
144.26calculating aid to cities for aids payable in 2008. For aids payable in 2010 and thereafter,
144.27Data used in calculating aids to cities under sections 477A.011 to 477A.013 shall be the
144.28most recently available data as of January 1 in the year in which the aid is calculated except
144.29as provided in section 477A.011, subdivisions 3 and 35 that the data used to compute "net
144.30levy" in subdivision 9 is the data most recently available at the time of the aid computation.
144.31EFFECTIVE DATE.This section is effective for aid payable in 2010 and thereafter.

144.32    Sec. 18. Laws 2001, First Special Session chapter 5, article 3, section 50, the effective
144.33date, as amended by Laws 2009, chapter 86, article 1, section 87, is amended to read:
145.1EFFECTIVE DATE.Clause (22) of this section is effective for taxes levied in 2002,
145.2payable in 2003, through taxes levied in 2011, payable in 2012 and thereafter. Clause (23)
145.3of this section is effective for taxes levied in 2001, payable in 2002, and thereafter.
145.4EFFECTIVE DATE.This section is effective the day following final enactment.


145.7    Section 1. Minnesota Statutes 2008, section 282.01, subdivision 1, is amended to read:
145.8    Subdivision 1. Classification as conservation or nonconservation. It is the
145.9general policy of this state to encourage the best use of tax-forfeited lands, recognizing
145.10(a) When acting on behalf of the state under laws allowing the county board to classify
145.11and manage tax-forfeited lands held by the state in trust for the local units as provided in
145.12section 281.25, the county board has the discretion to decide that some lands in public
145.13ownership should be retained and managed for public benefits while other lands should be
145.14returned to private ownership. Parcels of land becoming the property of the state in trust
145.15under law declaring the forfeiture of lands to the state for taxes must be classified by the
145.16county board of the county in which the parcels lie as conservation or nonconservation. In
145.17making the classification the board shall consider the present use of adjacent lands, the
145.18productivity of the soil, the character of forest or other growth, accessibility of lands
145.19to established roads, schools, and other public services, their peculiar suitability or
145.20desirability for particular uses, and the suitability of the forest resources on the land for
145.21multiple use, and sustained yield management. The classification, furthermore, must: (1)
145.22encourage and foster a mode of land utilization that will facilitate the economical and
145.23adequate provision of transportation, roads, water supply, drainage, sanitation, education,
145.24and recreation; (2) facilitate reduction of governmental expenditures; (3) conserve and
145.25develop the natural resources; and (4) foster and develop agriculture and other industries
145.26in the districts and places best suited to them.
145.27In making the classification the county board may use information made available
145.28by any office or department of the federal, state, or local governments, or by any other
145.29person or agency possessing pertinent information at the time the classification is made.
145.30The lands may be reclassified from time to time as the county board considers necessary
145.31or desirable, except for conservation lands held by the state free from any trust in favor of
145.32any taxing district.
145.33If the lands are located within the boundaries of an organized town, with taxable
145.34valuation in excess of $20,000, or incorporated municipality, the classification or
145.35reclassification and sale must first be approved by the town board of the town or the
146.1governing body of the municipality in which the lands are located. The town board of
146.2the town or the governing body of the municipality is considered to have approved
146.3the classification or reclassification and sale if the county board is not notified of the
146.4disapproval of the classification or reclassification and sale within 60 days of the date the
146.5request for approval was transmitted to the town board of the town or governing body
146.6of the municipality. If the town board or governing body desires to acquire any parcel
146.7lying in the town or municipality by procedures authorized in this section, it must file a
146.8written application with the county board to withhold the parcel from public sale. The
146.9application must be filed within 60 days of the request for classification or reclassification
146.10and sale. The county board shall then withhold the parcel from public sale for six months.
146.11A municipality or governmental subdivision shall pay maintenance costs incurred by
146.12the county during the six-month period while the property is withheld from public sale,
146.13provided the property is not offered for public sale after the six-month period. A clerical
146.14error made by county officials does not serve to eliminate the request of the town board
146.15or governing body if the board or governing body has forwarded the application to the
146.16county auditor. If the town board or governing body of the municipality fails to submit an
146.17application and a resolution of the board or governing body to acquire the property within
146.18the withholding period, the county may offer the property for sale upon the expiration of
146.19the withholding period.
146.20(b) Whenever the county board deems it appropriate, the board may hold a meeting
146.21for the purpose of reclassifying tax-forfeited land that has not been sold or released from
146.22the trust. The criteria and procedures for reclassification are the same as those required for
146.23an initial classification.
146.24(c) Prior to meeting for the purpose of classifying or reclassifying tax-forfeited lands,
146.25the county board must give notice of its intent to meet for that purpose as provided in this
146.26paragraph. The notice must be given no more than 90 days and no less than 60 days before
146.27the date of the meeting; provided that if the meeting is rescheduled, notice of the new
146.28date, time, and location must be given at least 14 days before the date of the rescheduled
146.29meeting. The notice must be posted on a Web site. The notice must also be mailed or
146.30otherwise delivered to each person who has filed a request for notice of special meetings
146.31with the public body, regardless of whether the matter is considered at a regular or special
146.32meeting. The notice must be mailed or delivered at least 60 days before the date of the
146.33meeting. If the meeting is rescheduled, notice of the new date, time, and location must be
146.34mailed or delivered at least 14 days before the date of the rescheduled meeting. The public
146.35body shall publish the notice once, at least 30 days before the meeting, in a newspaper of
146.36general circulation within the area of the public body's authority. The board must also mail
147.1a notice by electronic means to each person who requests notice of meetings dealing with
147.2this subject and who agrees as provided in chapter 325L to accept notice that is mailed
147.3by electronic means. Receipt of actual notice under the conditions specified in section
147.413D.04, subdivision 7, satisfies the notice requirements of this paragraph.
147.5The board may classify or reclassify tax-forfeited lands at any regular or special
147.6meeting, as those terms are defined in chapter 13D and may conduct only this business, or
147.7this business as well as other business or activities at the meeting.
147.8(d) At the meeting, the county board must allow any person or agency possessing
147.9pertinent information to make or submit comments and recommendations about the
147.10pending classification or reclassification. In addition, representatives of governmental
147.11entities in attendance must be allowed to describe plans, ideas, or projects that may
147.12involve use or acquisition of the property by that or another governmental entity. The
147.13county board must solicit and consider any relevant components of current municipal or
147.14metropolitan comprehensive land use plans that incorporate the area in which the land
147.15is located. After allowing testimony, the board may classify, reclassify, or delay taking
147.16action on any parcel or parcels. In order for a state agency or a governmental subdivision
147.17of the state to preserve its right to request a purchase or other acquisition of a forfeited
147.18parcel, it may, at any time following forfeiture, file a written request to withhold the parcel
147.19from sale or lease to others under the provisions of subdivision 1a.
147.20(e) When classifying, reclassifying, appraising, and selling lands under this chapter,
147.21the county board may designate the tracts as assessed and acquired, or may by resolution
147.22provide for the subdivision of the tracts into smaller units or for the grouping of several
147.23tracts into one tract when the subdivision or grouping is deemed advantageous for
147.24conservation or sale purposes. This paragraph does not authorize the county board to
147.25subdivide a parcel or tract of tax-forfeited land that, as assessed and acquired, is withheld
147.26from sale under section 282.018, subdivision 1.
147.27(f) A county board may by resolution elect to use the classification and
147.28reclassification procedures provided in paragraphs (g), (h), and (i), instead of the
147.29procedures provided in paragraphs (b), (c), and (d). Once an election is made under this
147.30paragraph, it is effective for a minimum of five years.
147.31(g) The classification or reclassification of tax-forfeited land that has not been sold or
147.32released from the trust may be made by the county board using information made available
147.33to it by any office or department of the federal, state, or local governments, or by any other
147.34person or agency possessing pertinent information at the time the classification is made.
147.35(h) If the lands are located within the boundaries of an organized town or
147.36incorporated municipality, a classification or reclassification and sale must first be
148.1approved by the town board of the town or the governing body of the municipality in
148.2which the lands are located. The town board of the town or the governing body of the
148.3municipality is considered to have approved the classification or reclassification and sale
148.4if the county board is not notified of the disapproval of the classification or reclassification
148.5and sale within 60 days of the date the request for approval was transmitted to the town
148.6board of the town or governing body of the municipality. If the town board or governing
148.7body disapproves of the classification or reclassification and sale, the county board must
148.8follow the procedures in paragraphs (c) and (d), with regard to the parcel, and must
148.9additionally cause to be published in a newspaper a notice of the date, time, location, and
148.10purpose of the required meeting.
148.11(i) If a town board or a governing body of a municipality or a park and recreation
148.12board in a city of the first class desires to acquire any parcel lying in the town or
148.13municipality by procedures authorized in this section, it may file a written request under
148.14subdivision 1a, paragraph (a).
148.15EFFECTIVE DATE.This section is effective July 1, 2010.

148.16    Sec. 2. Minnesota Statutes 2008, section 282.01, subdivision 1a, is amended to read:
148.17    Subd. 1a. Conveyance; generally to public entities. (a) Upon written request
148.18from a state agency or a governmental subdivision of the state, a parcel of unsold
148.19tax-forfeited land must be withheld from sale or lease to others for a maximum of six
148.20months. The request must be submitted to the county auditor. Upon receipt, the county
148.21auditor must withhold the parcel from sale or lease to any other party for six months, and
148.22must confirm the starting date of the six-month withholding period to the requesting
148.23agency or subdivision. If the request is from a governmental subdivision of the state, the
148.24governmental subdivision must pay the maintenance costs incurred by the county during
148.25the period the parcel is withheld. The county board may approve a sale or conveyance to
148.26the requesting party during the withholding period. A conveyance of the property to the
148.27requesting party terminates the withholding period.
148.28A governmental subdivision of the state must not make, and a county auditor must
148.29not act upon, a second request to withhold a parcel from sale or lease within 18 months
148.30of a previous request for that parcel. A county may reject a request made under this
148.31paragraph if the request is made more than 30 days after the county has given notice to the
148.32requesting state agency or governmental subdivision of the state that the county intends to
148.33sell or otherwise dispose of the property.
148.34(b) Nonconservation tax-forfeited lands may be sold by the county board, for
148.35their market value as determined by the county board, to an organized or incorporated
149.1governmental subdivision of the state for any public purpose for which the subdivision is
149.2authorized to acquire property or. When the term "market value" is used in this section, it
149.3means an estimate of the full and actual market value of the parcel as determined by the
149.4county board, but in making this determination, the board and the persons employed by or
149.5under contract with the board in order to perform, conduct, or assist in the determination,
149.6are exempt from the licensure requirements of chapter 82B.
149.7(c) Nonconservation tax-forfeited lands may be released from the trust in favor of the
149.8taxing districts on application of to the county board by a state agency for an authorized
149.9use at not less than their market value as determined by the county board.
149.10(d) Nonconservation tax-forfeited lands may be sold by the county board to an
149.11organized or incorporated governmental subdivision of the state or state agency for less
149.12than their market value if:
149.13(1) the county board determines that a sale at a reduced price is in the public interest
149.14because a reduced price is necessary to provide an incentive to correct the blighted
149.15conditions that make the lands undesirable in the open market, or the reduced price will
149.16lead to the development of affordable housing; and
149.17(2) the governmental subdivision or state agency has documented its specific plans
149.18for correcting the blighted conditions or developing affordable housing, and the specific
149.19law or laws that empower it to acquire real property in furtherance of the plans.
149.20If the sale under this paragraph is to a governmental subdivision of the state, the
149.21commissioner of revenue must convey the property on behalf of the state by quit claim
149.22deed. If the sale under this paragraph is to a state agency, the commissioner must issue a
149.23conveyance document that releases the property from the trust in favor of the taxing
149.24districts.
149.25(e) Nonconservation tax-forfeited land held in trust in favor of the taxing districts
149.26may be conveyed by the commissioner of revenue may convey by deed in the name
149.27of the state a tract of tax-forfeited land held in trust in favor of the taxing districts to a
149.28governmental subdivision for an authorized public use, if an application is submitted to
149.29the commissioner which includes a statement of facts as to the use to be made of the tract
149.30and the need therefor and the favorable recommendation of the county board. For the
149.31purposes of this paragraph, "authorized public use" means a use that allows an indefinite
149.32segment of the public to physically use and enjoy the property in numbers appropriate
149.33to its size and use, or is for a public service facility. Authorized public uses as defined
149.34in this paragraph are limited to:
149.35(1) a road, or right-of-way for a road;
150.1(2) a park that is both available to, and accessible by, the public that contains
150.2amenities such as campgrounds, playgrounds, athletic fields, trails, or shelters;
150.3(3) trails for walking, bicycling, snowmobiling, or other recreational purposes, along
150.4with a reasonable amount of surrounding land maintained in its natural state;
150.5(4) transit facilities for buses, light rail transit, commuter rail or passenger rail,
150.6including transit ways, park-and-ride lots, transit stations, maintenance and garage
150.7facilities, and other facilities related to a public transit system;
150.8(5) public beaches or boat launches;
150.9(6) public parking;
150.10(7) civic recreation or conference facilities; and
150.11(8) public service facilities such as fire halls, police stations, lift stations, water
150.12towers, sanitation facilities, water treatment facilities, and administrative offices.
150.13No monetary compensation or consideration is required for the conveyance, except as
150.14provided in subdivision 1g, but the conveyance is subject to the conditions provided in
150.15law, including, but not limited to, the reversion provisions of subdivisions 1c and 1d.
150.16(f) The commissioner of revenue shall convey a parcel of nonconservation
150.17tax-forfeited land to a local governmental subdivision of the state by quit claim deed
150.18on behalf of the state upon the favorable recommendation of the county board if the
150.19governmental subdivision has certified to the board that prior to forfeiture the subdivision
150.20was entitled to the parcel under a written development agreement or instrument, but
150.21the conveyance failed to occur prior to forfeiture. No compensation or consideration is
150.22required for, and no conditions attach to, the conveyance.
150.23(g) The commissioner of revenue shall convey a parcel of nonconservation
150.24tax-forfeited land to the association of a common interest community by quit claim deed
150.25upon the favorable recommendation of the county board if the association certifies to the
150.26board that prior to forfeiture the association was entitled to the parcel under a written
150.27agreement, but the conveyance failed to occur prior to forfeiture. No compensation or
150.28consideration is required for, and no conditions attach to, the conveyance.
150.29(h) Conservation tax-forfeited land may be sold to a governmental subdivision of the
150.30state for less than its market value for either: (1) creation or preservation of wetlands;
150.31(2) drainage or storage of storm water under a storm water management plan; or (3)
150.32preservation, or restoration and preservation, of the land in its natural state. The deed must
150.33contain a restrictive covenant limiting the use of the land to one of these purposes for
150.3430 years or until the property is reconveyed back to the state in trust. At any time, the
150.35governmental subdivision may reconvey the property to the state in trust for the taxing
150.36districts. The deed of reconveyance is subject to approval by the commissioner of revenue.
151.1No part of a purchase price determined under this paragraph shall be refunded upon a
151.2reconveyance, but the amount paid for a conveyance under this paragraph may be taken
151.3into account by the county board when setting the terms of a future sale of the same
151.4property to the same governmental subdivision under paragraph (b) or (d). If the lands
151.5are unplatted and located outside of an incorporated municipality and the commissioner
151.6of natural resources determines there is a mineral use potential, the sale is subject to the
151.7approval of the commissioner of natural resources.
151.8(i) A park and recreation board in a city of the first class is a governmental
151.9subdivision for the purposes of this section.
151.10EFFECTIVE DATE.This section is effective July 1, 2010.

151.11    Sec. 3. Minnesota Statutes 2008, section 282.01, subdivision 1b, is amended to read:
151.12    Subd. 1b. Conveyance; targeted neighborhood community lands. (a)
151.13Notwithstanding subdivision 1a, in the case of tax-forfeited lands located in a targeted
151.14neighborhood, as defined in section 469.201, subdivision 10 community in a city of the
151.15first class, the commissioner of revenue shall convey by quit claim deed in the name of the
151.16state any tract of tax-forfeited land held in trust in favor of the taxing districts, to a political
151.17subdivision of the state that submits an application to the commissioner of revenue and
151.18the favorable recommendation of the county board. For purposes of this subdivision, the
151.19term "targeted community" has the meaning given in section 469.201, subdivision 10,
151.20except that the land must be located within a first class city.
151.21(b) The application under paragraph (a) must include a statement of facts as to the
151.22use to be made of the tract, the need therefor, and a resolution, adopted by the governing
151.23body of the political subdivision, finding that the conveyance of a tract of tax-forfeited
151.24land to the political subdivision is necessary to provide for the redevelopment of land as
151.25productive taxable property. Deeds of conveyance issued under paragraph (a) are not
151.26conditioned on continued use of the property for the use stated in the application.
151.27EFFECTIVE DATE.This section is effective July 1, 2010.

151.28    Sec. 4. Minnesota Statutes 2008, section 282.01, subdivision 1c, is amended to read:
151.29    Subd. 1c. Deed of conveyance; form; approvals. The deed of conveyance for
151.30property conveyed for a an authorized public use under the authorities in subdivision
151.311a, paragraph (e), must be on a form approved by the attorney general and must be
151.32conditioned on continued use for the purpose stated in the application as provided in this
151.33section. These deeds are conditional use deeds that convey a defeasible estate. Reversion
152.1of the estate occurs by operation of law and without the requirement for any affirmative
152.2act by or on behalf of the state when there is a failure to put the property to the approved
152.3authorized public use for which it was conveyed, or an abandonment of that use, except as
152.4provided in subdivision 1d.
152.5EFFECTIVE DATE.This section is effective July 1, 2010.

152.6    Sec. 5. Minnesota Statutes 2008, section 282.01, subdivision 1d, is amended to read:
152.7    Subd. 1d. Reverter for failure to use; conveyance to state. (a) If after three years
152.8from the date of the conveyance a governmental subdivision to which tax-forfeited land
152.9has been conveyed for a specified an authorized public use as provided in this section
152.10subdivision 1a, paragraph (e), fails to put the land to that use, or abandons that use, the
152.11governing body of the subdivision may, must: (1) with the approval of the county board,
152.12purchase the property for an authorized public purpose at the present appraised market
152.13value as determined by the county board. In that case, the commissioner of revenue shall,
152.14upon proper written application approved by the county board, issue an appropriate deed
152.15to the subdivisions free of a use restriction and reverter. The governing body may also, or
152.16(2) authorize the proper officers to convey the land, or the part of the land not required for
152.17an authorized public use, to the state of Minnesota. in trust for the taxing districts. If the
152.18governing body purchases the property under clause (1), the commissioner of revenue
152.19shall, upon proper application submitted by the county auditor, convey the property on
152.20behalf of the state by quit claim deed to the subdivision free of a use restriction and the
152.21possibility of reversion or defeasement. If the governing body decides to reconvey the
152.22property to the state under this clause, the officers shall execute a deed of conveyance
152.23immediately. The conveyance is subject to the approval of the commissioner and its form
152.24must be approved by the attorney general. A sale, lease, transfer, or other conveyance
152.25of tax-forfeited lands by a housing and redevelopment authority, a port authority, an
152.26economic development authority, or a city as authorized by chapter 469 is not an
152.27abandonment of use and the lands shall not be reconveyed to the state nor shall they
152.28revert to the state. A certificate made by a housing and redevelopment authority, a port
152.29authority, an economic development authority, or a city referring to a conveyance by it
152.30and stating that the conveyance has been made as authorized by chapter 469 may be filed
152.31with the county recorder or registrar of titles, and the rights of reverter in favor of the state
152.32provided by subdivision 1e will then terminate. No vote of the people is required for the
152.33conveyance. For the purposes of this paragraph, there is no failure to put the land to the
152.34authorized public use and no abandonment of that use if a formal plan of the governmental
153.1subdivision, including, but not limited to, a comprehensive plan or land use plan that
153.2shows an intended future use of the land for the authorized public use.
153.3(b) Property held by a governmental subdivision of the state under a conditional use
153.4deed executed under subdivision 1a, paragraph (e), by the commissioner of revenue on or
153.5after January 1, 2007, may be acquired by that governmental subdivision after 15 years
153.6from the date of the conveyance if the commissioner determines upon written application
153.7from the subdivision that the subdivision has in fact put the property to the authorized
153.8public use for which it was conveyed, and the subdivision has made a finding that it
153.9has no current plans to change the use of the lands. Prior to conveying the property, the
153.10commissioner shall inquire whether the county board where the land is located objects to a
153.11conveyance of the property to the subdivision without conditions and without further act
153.12by or obligation of the subdivision. If the county does not object within 60 days, and the
153.13commissioner makes a favorable determination, the commissioner shall issue a quit claim
153.14deed on behalf of the state unconditionally conveying the property to the governmental
153.15subdivision. For purposes of this paragraph, demonstration of an intended future use
153.16for the authorized public use in a formal plan of the governmental subdivision does not
153.17constitute use for that authorized public use.
153.18(c) Property held by a governmental subdivision of the state under a conditional
153.19use deed executed under subdivision 1a, paragraph (e), by the commissioner of revenue
153.20before January 1, 2007, is released from the use restriction and possibility of reversion on
153.21January 1, 2022, if the county board records a resolution describing the land and citing
153.22this paragraph. The county board may authorize the county treasurer to deduct the amount
153.23of the recording fees from future settlements of property taxes to the subdivision.
153.24(d) All property conveyed under a conditional use deed executed under subdivision
153.251a, paragraph (e), by the commissioner of revenue is released from the use restriction and
153.26reverter, and any use restriction or reverter for which no declaration of reversion has been
153.27recorded with the county recorder or registrar of titles, as appropriate, is nullified on the
153.28later of: (1) January 1, 2015; (2) 30 years from the date the deed was acknowledged; or
153.29(3) final resolution of an appeal to district court under subdivision 1e, if a lis pendens
153.30related to the appeal is recorded in the office of the county recorder or registrar of titles,
153.31as appropriate, prior to January 1, 2015.
153.32EFFECTIVE DATE.This section is effective July 1, 2010.

153.33    Sec. 6. Minnesota Statutes 2008, section 282.01, is amended by adding a subdivision
153.34to read:
154.1    Subd. 1g. Conditional use deed fees. (a) A governmental subdivision of the state
154.2applying for a conditional use deed under subdivision 1a, paragraph (e), must submit a fee
154.3of $250 to the commissioner of revenue along with the application. If the application is
154.4denied, the commissioner shall refund $150 of the application fee.
154.5(b) The proceeds from the fees must be deposited in a Department of Revenue
154.6conditional use deed revolving fund. The sums deposited into the revolving fund are
154.7appropriated to the commissioner of revenue for the purpose of making the refunds
154.8described in this subdivision, and administering conditional use deed laws.
154.9EFFECTIVE DATE.This section is effective for applications received by the
154.10commissioner after June 30, 2010.

154.11    Sec. 7. Minnesota Statutes 2008, section 282.01, is amended by adding a subdivision
154.12to read:
154.13    Subd. 1h. Conveyance; form. The instruments of conveyance executed and issued
154.14by the commissioner of revenue under subdivision 1a, paragraphs (c), (d), (e), (f), (g),
154.15and (h), and subdivision 1d, paragraph (b), must be on a form approved by the attorney
154.16general and are prima facie evidence of the facts stated therein and that the execution and
154.17issuance of the conveyance complies with the applicable laws.
154.18EFFECTIVE DATE.This section is effective for deeds executed by the
154.19commissioner of revenue after June 30, 2010.

154.20    Sec. 8. Minnesota Statutes 2008, section 282.01, subdivision 2, is amended to read:
154.21    Subd. 2. Conservation lands; county board supervision. (a) Lands classified as
154.22conservation lands, unless reclassified as nonconservation lands, sold to a governmental
154.23subdivision of the state, designated as lands primarily suitable for forest production and
154.24sold as hereinafter provided, or released from the trust in favor of the taxing districts, as
154.25herein provided, will must be held under the supervision of the county board of the county
154.26within which such the parcels lie. and must not be conveyed or sold unless the lands are:
154.27The county board may, by resolution duly adopted, declare lands classified as
154.28conservation lands as primarily suitable for timber production and as lands which should
154.29be placed in private ownership for such purposes. If such action be approved by the
154.30commissioner of natural resources, the lands so designated, or any part thereof, may be
154.31sold by the county board in the same manner as provided for the sale of lands classified as
154.32nonconservation lands. Such county action and the approval of the commissioner shall be
155.1limited to lands lying within areas zoned for restricted uses under the provisions of Laws
155.21939, chapter 340, or any amendments thereof.
155.3(1) reclassified as nonconservation lands;
155.4(2) conveyed to a governmental subdivision of the state under subdivision 1a;
155.5(3) released from the trust in favor of the taxing districts as provided in paragraph
155.6(b); or
155.7(4) conveyed or sold under the authority of another general or special law.
155.8(b) The county board may, by resolution duly adopted, resolve that certain lands
155.9classified as conservation lands shall be devoted to conservation uses and may submit
155.10such a resolution to the commissioner of natural resources. If, upon investigation,
155.11the commissioner of natural resources determines that the lands covered by such the
155.12resolution, or any part thereof, can be managed and developed for conservation purposes,
155.13the commissioner shall make a certificate describing the lands and reciting the acceptance
155.14thereof on behalf of the state for such purposes. The commissioner shall transmit the
155.15certificate to the county auditor, who shall note the same upon the auditor's records and
155.16record the same with the county recorder. The title to all lands so accepted shall be held
155.17by the state free from any trust in favor of any and all taxing districts and such the lands
155.18shall be devoted thereafter to the purposes of forestry, water conservation, flood control,
155.19parks, game refuges, controlled game management areas, public shooting grounds, or
155.20other public recreational or conservation uses, and managed, controlled, and regulated
155.21for such purposes under the jurisdiction of the commissioner of natural resources and
155.22the divisions of the department.
155.23(c) All proceeds derived from the sale of timber, lease of crops of hay, or other
155.24revenue from lands under the jurisdiction of the commissioner of natural resources shall
155.25be credited to the general fund of the state.
155.26In case (d) If the commissioner of natural resources shall determine determines that
155.27any tract of land so held acquired by the state under paragraph (b) and situated within or
155.28adjacent to the boundaries of any governmental subdivision of the state is suitable for use
155.29by such the subdivision for any authorized public purpose, the commissioner may convey
155.30such the tract by deed in the name of the state to such the subdivision upon the filing
155.31with the commissioner of a resolution adopted by a majority vote of all the members
155.32of the governing body thereof, stating the purpose for which the land is desired. The
155.33deed of conveyance shall be upon a form approved by the attorney general and must be
155.34conditioned upon continued use for the purpose stated in the resolution. All proceeds
155.35derived from the sale of timber, lease of hay stumpage, or other revenue from such
156.1lands under the jurisdiction of the natural resources commissioner shall be paid into the
156.2general fund of the state.
156.3(e) The county auditor, with the approval of the county board, may lease conservation
156.4lands remaining under the jurisdiction supervision of the county board and sell timber
156.5and hay stumpage thereon in the manner hereinafter provided, and all proceeds derived
156.6therefrom shall be distributed in the same manner as provided in section 282.04.
156.7EFFECTIVE DATE.This section is effective July 1, 2010.

156.8    Sec. 9. Minnesota Statutes 2008, section 282.01, subdivision 3, is amended to read:
156.9    Subd. 3. Nonconservation lands; appraisal and sale. (a) All parcels of land
156.10classified as nonconservation, except those which may be reserved, shall be sold as
156.11provided, if it is determined, by the county board of the county in which the parcels lie,
156.12that it is advisable to do so, having in mind their accessibility, their proximity to existing
156.13public improvements, and the effect of their sale and occupancy on the public burdens.
156.14Any parcels of land proposed to be sold shall be first appraised by the county board of
156.15the county in which the parcels lie. The parcels may be reappraised whenever the county
156.16board deems it necessary to carry out the intent of sections 282.01 to 282.13.
156.17(b) In an appraisal the value of the land and any standing timber on it shall be
156.18separately determined. No parcel of land containing any standing timber may be sold until
156.19the appraised value of the timber on it and the sale of the land have been approved by the
156.20commissioner of natural resources. The commissioner shall base review of a proposed
156.21sale on the policy and considerations specified in subdivision 1. The decision of the
156.22commissioner shall be in writing and shall state the reasons for it. The commissioner's
156.23decision is exempt from the rulemaking provisions of chapter 14 and section 14.386
156.24does not apply. The county may appeal the decision of the commissioner in accordance
156.25with chapter 14.
156.26(c) In any county in which a state forest or any part of it is located, the county
156.27auditor shall submit to the commissioner at least 60 days before the first publication of the
156.28list of lands to be offered for sale a list of all lands included on the list which are situated
156.29outside of any incorporated municipality. If, at any time before the opening of the sale, the
156.30commissioner notifies the county auditor in writing that there is standing timber on any
156.31parcel of such land, the parcel shall not be sold unless the requirements of this section
156.32respecting the separate appraisal of the timber and the approval of the appraisal by the
156.33commissioner have been complied with. The commissioner may waive the requirement
156.34of the 60-day notice as to any parcel of land which has been examined and the timber
156.35value approved as required by this section.
157.1(d) If any public improvement is made by a municipality after any parcel of land has
157.2been forfeited to the state for the nonpayment of taxes, and the improvement is assessed in
157.3whole or in part against the property benefited by it, the clerk of the municipality shall
157.4certify to the county auditor, immediately upon the determination of the assessments for
157.5the improvement, the total amount that would have been assessed against the parcel of land
157.6if it had been subject to assessment; or if the public improvement is made, petitioned for,
157.7ordered in or assessed, whether the improvement is completed in whole or in part, at any
157.8time between the appraisal and the sale of the parcel of land, the cost of the improvement
157.9shall be included as a separate item and added to the appraised value of the parcel of land
157.10at the time it is sold. No sale of a parcel of land shall discharge or free the parcel of land
157.11from lien for the special benefit conferred upon it by reason of the public improvement
157.12until the cost of it, including penalties, if any, is paid. The county board shall determine
157.13the amount, if any, by which the value of the parcel was enhanced by the improvement and
157.14include the amount as a separate item in fixing the appraised value for the purpose of sale.
157.15In classifying, appraising, and selling the lands, the county board may designate the tracts
157.16as assessed and acquired, or may by resolution provide for the subdivision of the tracts into
157.17smaller units or for the grouping of several tracts into one tract when the subdivision or
157.18grouping is deemed advantageous for the purpose of sale. Each such smaller tract or larger
157.19tract must be classified and appraised as such before being offered for sale. If any such
157.20lands have once been classified, the board of county commissioners, in its discretion, may,
157.21by resolution, authorize the sale of the smaller tract or larger tract without reclassification.
157.22EFFECTIVE DATE.This section is effective July 1, 2010.

157.23    Sec. 10. Minnesota Statutes 2008, section 282.01, subdivision 4, is amended to read:
157.24    Subd. 4. Sale: method, requirements, effects. The sale authorized under
157.25subdivision 3 must be conducted by the county auditor at the county seat of the county in
157.26which the parcels lie, except that in St. Louis and Koochiching Counties, the sale may
157.27be conducted in any county facility within the county. The sale must not be for less than
157.28the appraised value except as provided in subdivision 7a. The parcels must be sold for
157.29cash only and at not less than the appraised value, unless the county board of the county
157.30has adopted a resolution providing for their sale on terms, in which event the resolution
157.31controls with respect to the sale. When the sale is made on terms other than for cash only
157.32(1) a payment of at least ten percent of the purchase price must be made at the time of
157.33purchase, and the balance must be paid in no more than ten equal annual installments, or
157.34(2) the payments must be made in accordance with county board policy, but in no event
157.35may the board require more than 12 installments annually, and the contract term must not
158.1be for more than ten years. Standing timber or timber products must not be removed from
158.2these lands until an amount equal to the appraised value of all standing timber or timber
158.3products on the lands at the time of purchase has been paid by the purchaser. If a parcel of
158.4land bearing standing timber or timber products is sold at public auction for more than
158.5the appraised value, the amount bid in excess of the appraised value must be allocated
158.6between the land and the timber in proportion to their respective appraised values. In that
158.7case, standing timber or timber products must not be removed from the land until the
158.8amount of the excess bid allocated to timber or timber products has been paid in addition
158.9to the appraised value of the land. The purchaser is entitled to immediate possession,
158.10subject to the provisions of any existing valid lease made in behalf of the state.
158.11For sales occurring on or after July 1, 1982, the unpaid balance of the purchase price
158.12is subject to interest at the rate determined pursuant to section 549.09. The unpaid balance
158.13of the purchase price for sales occurring after December 31, 1990, is subject to interest
158.14at the rate determined in section 279.03, subdivision 1a. The interest rate is subject to
158.15change each year on the unpaid balance in the manner provided for rate changes in section
158.16549.09 or 279.03, subdivision 1a, whichever, is applicable. Interest on the unpaid contract
158.17balance on sales occurring before July 1, 1982, is payable at the rate applicable to the sale
158.18at the time that the sale occurred.
158.19EFFECTIVE DATE.This section is effective July 1, 2010.

158.20    Sec. 11. Minnesota Statutes 2008, section 282.01, subdivision 7, is amended to read:
158.21    Subd. 7. County sales; notice, purchase price, disposition. The sale must
158.22commence at the time determined by the county board of the county in which the parcels
158.23are located. The county auditor shall offer the parcels of land in order in which they
158.24appear in the notice of sale, and shall sell them to the highest bidder, but not for a sum
158.25less than the appraised value, until all of the parcels of land have been offered. Then the
158.26county auditor shall sell any remaining parcels to anyone offering to pay the appraised
158.27value, except that if the person could have repurchased a parcel of property under section
158.28282.012 or 282.241, that person may not purchase that same parcel of property at the sale
158.29under this subdivision for a purchase price less than the sum of all taxes, assessments,
158.30penalties, interest, and costs due at the time of forfeiture computed under section 282.251,
158.31and any special assessments for improvements certified as of the date of sale. The sale
158.32must continue until all the parcels are sold or until the county board orders a reappraisal or
158.33withdraws any or all of the parcels from sale. The list of lands may be added to and the
158.34added lands may be sold at any time by publishing the descriptions and appraised values.
158.35The added lands must be: (1) parcels of land that have become forfeited and classified
159.1as nonconservation since the commencement of any prior sale; (2) parcels classified as
159.2nonconservation that have been reappraised; (3) parcels that have been reclassified as
159.3nonconservation; or (4) other parcels that are subject to sale but were omitted from the
159.4existing list for any reason. The descriptions and appraised values must be published in
159.5the same manner as provided for the publication of the original list. Parcels added to the
159.6list must first be offered for sale to the highest bidder before they are sold at appraised
159.7value. All parcels of land not offered for immediate sale, as well as parcels that are offered
159.8and not immediately sold, continue to be held in trust by the state for the taxing districts
159.9interested in each of the parcels, under the supervision of the county board. Those parcels
159.10may be used for public purposes until sold, as directed by the county board.
159.11EFFECTIVE DATE.This section is effective July 1, 2010.

159.12    Sec. 12. Minnesota Statutes 2008, section 282.01, subdivision 7a, is amended to read:
159.13    Subd. 7a. City sales; alternate procedures. Land located in a home rule charter
159.14or statutory city, or in a town which cannot be improved because of noncompliance with
159.15local ordinances regarding minimum area, shape, frontage or access may be sold by the
159.16county auditor pursuant to this subdivision if the auditor determines that a nonpublic sale
159.17will encourage the approval of sale of the land by the city or town and promote its return
159.18to the tax rolls. If the physical characteristics of the land indicate that its highest and best
159.19use will be achieved by combining it with an adjoining parcel and the city or town has not
159.20adopted a local ordinance governing minimum area, shape, frontage, or access, the land
159.21may also be sold pursuant to this subdivision. If the property consists of an undivided
159.22interest in land or land and improvements, the property may also be sold to the other
159.23owners under this subdivision. The sale of land pursuant to this subdivision shall be
159.24subject to any conditions imposed by the county board pursuant to section 282.03. The
159.25governing body of the city or town may recommend to the county board conditions to be
159.26imposed on the sale. The county auditor may restrict the sale to owners of lands adjoining
159.27the land to be sold. The county auditor shall conduct the sale by sealed bid or may select
159.28another means of sale. The land shall be sold to the highest bidder but in no event shall the
159.29land and may be sold for less than its appraised value. All owners of land adjoining the
159.30land to be sold shall be given a written notice at least 30 days prior to the sale.
159.31This subdivision shall be liberally construed to encourage the sale and utilization
159.32of tax-forfeited land, to eliminate nuisances and dangerous conditions and to increase
159.33compliance with land use ordinances.
159.34EFFECTIVE DATE.This section is effective July 1, 2010.

160.1    Sec. 13. Minnesota Statutes 2008, section 282.01, is amended by adding a subdivision
160.2to read:
160.3    Subd. 12. Notice; public hearing for use change. If a governmental subdivision
160.4that acquired a parcel for public use under this section later determines to change the use,
160.5it must hold a public hearing on the proposed use change. The governmental subdivision
160.6must mail written notice of the proposed use change and the public hearing to each owner
160.7of property that is within 400 feet of the parcel at least ten days and no more than 60 days
160.8before it holds the hearing. The notice must identify: (1) the parcel, (2) its current use,
160.9(3) the proposed use, (4) the date, time, and place of the public hearing, and (5) where
160.10to submit written comments on the proposal and that the public is invited to testify at
160.11the public hearing.
160.12EFFECTIVE DATE.This section is effective July 1, 2010, and applies to a change
160.13in use of a parcel acquired under Minnesota Statutes, section 282.01, whether acquired by
160.14the governmental subdivision before or after the effective date of this section.

160.15    Sec. 14. REPEALER.
160.16Minnesota Statutes 2008, sections 282.01, subdivisions 9, 10, and 11; and 383A.76,
160.17are repealed.
160.18EFFECTIVE DATE.This section is effective July 1, 2010.


160.21    Section 1. [3.192] TAX EXPENDITURE BILLS.
160.22    Subdivision 1. Requirements for new or renewed tax expenditures. Any bill that
160.23creates, renews, or continues a tax expenditure must include a statement of intent that
160.24clearly provides the purpose of the tax expenditure and a standard or goal against which
160.25its effectiveness may be measured. For purposes of this section, "tax expenditure" has the
160.26meaning given in section 270C.11, subdivision 6.
160.27    Subd. 2. Expiration of tax expenditures. Any tax expenditure enacted after July
160.281, 2010, expires ten years from the day that the provision first takes effect. The bill may
160.29provide an early expiration date if desired.
160.30EFFECTIVE DATE.This section is effective for tax expenditures enacted after
160.31July 1, 2010.

160.32    Sec. 2. Minnesota Statutes 2008, section 270C.34, subdivision 1, is amended to read:
161.1    Subdivision 1. Authority. (a) The commissioner may abate, reduce, or refund any
161.2penalty or interest that is imposed by a law administered by the commissioner, or imposed
161.3by section 270.0725, subdivision 1 or 2, as a result of the late payment of tax or late
161.4filing of a return, if the failure to timely pay the tax or failure to timely file the return is
161.5due to reasonable cause, or if the taxpayer is located in a presidentially declared disaster
161.6or in a presidentially declared state of emergency area or in an area declared to be in a
161.7state of emergency by the governor under section 12.31.
161.8    (b) The commissioner shall abate any part of a penalty or additional tax charge
161.9under section 289A.25, subdivision 2, or 289A.26, subdivision 4, attributable to erroneous
161.10advice given to the taxpayer in writing by an employee of the department acting in
161.11an official capacity, if the advice:
161.12    (1) was reasonably relied on and was in response to a specific written request of the
161.13taxpayer; and
161.14    (2) was not the result of failure by the taxpayer to provide adequate or accurate
161.15information.
161.16    (c) The commissioner may abate a penalty imposed under section 270.0725,
161.17subdivision 1 or 2, if the failure to timely file is due to reasonable cause, or if the airline
161.18company is located in a presidentially declared disaster area.
161.19EFFECTIVE DATE.This section is effective the day following final enactment.

161.20    Sec. 3. Minnesota Statutes 2008, section 270C.52, subdivision 2, is amended to read:
161.21    Subd. 2. Payment agreements. (a) When any portion of any tax payable to the
161.22commissioner together with interest and penalty thereon, if any, has not been paid, the
161.23commissioner may extend the time for payment for a further period. When the authority
161.24of this section is invoked, the extension shall be evidenced by written agreement signed by
161.25the taxpayer and the commissioner, stating the amount of the tax with penalty and interest,
161.26if any, and providing for the payment of the amount in installments.
161.27(b) The agreement may contain a confession of judgment for the amount and for any
161.28unpaid portion thereof. If the agreement contains a confession of judgment, the confession
161.29of judgment must provide that the commissioner may enter judgment against the taxpayer
161.30in the district court of the county of residence as shown upon the taxpayer's tax return for
161.31the unpaid portion of the amount specified in the extension agreement.
161.32(c) The agreement shall provide that it can be terminated, after notice by the
161.33commissioner, if information provided by the taxpayer prior to the agreement was
161.34inaccurate or incomplete, collection of the tax covered by the agreement is in jeopardy,
161.35there is a subsequent change in the taxpayer's financial condition, the taxpayer has failed
162.1to make a payment due under the agreement, or the taxpayer has failed to pay any other
162.2tax or file a tax return coming due after the agreement.
162.3(d) The notice must be given at least 14 calendar days prior to termination, and shall
162.4advise the taxpayer of the right to request a reconsideration from the commissioner of
162.5whether termination is reasonable and appropriate under the circumstances. A request for
162.6reconsideration does not stay collection action beyond the 14-day notice period. If the
162.7commissioner has reason to believe that collection of the tax covered by the agreement
162.8is in jeopardy, the commissioner may proceed under section 270C.36 and terminate the
162.9agreement without regard to the 14-day period.
162.10(e) The commissioner may accept other collateral the commissioner considers
162.11appropriate to secure satisfaction of the tax liability. The principal sum specified in the
162.12agreement shall bear interest at the rate specified in section 270C.40 on all unpaid portions
162.13thereof until the same has been fully paid or the unpaid portion thereof has been entered as
162.14a judgment. The judgment shall bear interest at the rate specified in section 270C.40.
162.15(f) If it appears to the commissioner that the tax reported by the taxpayer is in excess
162.16of the amount actually owing by the taxpayer, the extension agreement or the judgment
162.17entered pursuant thereto shall be corrected. If after making the extension agreement
162.18or entering judgment with respect thereto, the commissioner determines that the tax as
162.19reported by the taxpayer is less than the amount actually due, the commissioner shall
162.20assess a further tax in accordance with the provisions of law applicable to the tax.
162.21(g) The authority granted to the commissioner by this section is in addition to any
162.22other authority granted to the commissioner by law to extend the time of payment or the
162.23time for filing a return and shall not be construed in limitation thereof.
162.24(h) The commissioner shall charge a fee for entering into payment agreements
162.25that reflects the commissioner's costs for entering into payment agreements. The fee is
162.26initially set at $25 and is adjusted annually as necessary. The fee is charged for entering
162.27into a payment agreement, for entering into a new payment agreement after the taxpayer
162.28has defaulted on a prior agreement, and for entering into a new payment agreement as
162.29a result of renegotiation of the terms of an existing agreement. The fee is paid to the
162.30commissioner before the payment agreement becomes effective and does not reduce
162.31the amount of the liability.
162.32By June 1 of each year, the commissioner shall determine the cost to the
162.33commissioner for entering into payment agreements during the fiscal year and adjust the
162.34payment agreement fee as necessary to most nearly equal those costs. Determination
162.35of the fee for payment agreements under this section is not subject to the fee setting
162.36requirements of section 16A.1283.
163.1EFFECTIVE DATE.This section is effective for payment agreements entered
163.2into or renegotiated after June 30, 2010.

163.3    Sec. 4. TAX EXPENDITURE REVIEW REPORT.
163.4    Subdivision 1. Report to the legislature. By January 10, 2011, the commissioner of
163.5revenue shall provide a report to the chairs of the house and senate tax committees with
163.6jurisdiction over taxes suggesting a process for the periodic review and sunset or extension
163.7of tax expenditures on an ongoing basis.
163.8    Subd. 2. Contents of the report. (a) The report shall include the following
163.9information for every tax, as defined in Minnesota Statutes, section 270C.11, subdivision 6:
163.10(1) a definition of the tax base for the tax;
163.11(2) a definition of a tax expenditure for each tax; and
163.12(3) a list of existing provisions in law that meet the definition of tax expenditure for
163.13each tax.
163.14(b) The report shall include a suggested list of information, currently not included in
163.15the tax expenditure budget under Minnesota Statutes, section 270C.11, needed to allow
163.16evaluation of the effectiveness of new and existing tax expenditures in meeting not only
163.17the stated goal of the tax expenditure but also the general tax principles of:
163.18(1) transparency and understandability;
163.19(2) simplicity and efficiency;
163.20(3) equity;
163.21(4) stability and predictability;
163.22(5) compliance and accountability; and
163.23(6) national and global competitiveness.
163.24(c) The report shall also include recommendations on specific procedures for
163.25periodic review of tax expenditures, including the need for additional reports, study or
163.26oversight groups, and fiscal or other resources, and a suggested timetable for systematic
163.27review of the tax expenditures in the various tax areas.
163.28EFFECTIVE DATE.This section is effective the day following final enactment.

163.29    Sec. 5. APPROPRIATION.
163.30$520,000 is appropriated in fiscal year 2011 from the general fund to the
163.31commissioner of revenue to administer the requirements in clauses (1) to (3). The
163.32appropriation must be distributed as follows:
164.1(1) $100,000 in fiscal year 2011 is for a study of fiscal disparities under article 1,
164.2section 36, and this appropriation is available until June 30, 2012;
164.3(2) $330,000 in fiscal year 2011 is for a study on income tax reciprocity under article
164.43, section 24, and this appropriation is available until June 30, 2012; and
164.5(3) $90,000 in fiscal year 2011 is for a tax expenditure review report under section 4
164.6of this article.
164.7The appropriations under this section are onetime and are not added to the agency's
164.8base budget."
164.9Delete the title and insert:
164.11relating to the financing and operation of state and local government; making
164.12policy, technical, administrative, payment, enforcement, collection, refund,
164.13and other changes to individual income; corporate franchise, estate, sales and
164.14use, local taxes, gross receipts, gross revenues, cigarette, tobacco, insurance,
164.15property, minerals, petroleum, and other taxes and tax-related provisions;
164.16requiring sunset of new tax expenditures; property tax reform, accountability,
164.17value, and efficiency provisions; modifying certain payment schedules; making
164.18changes to tax-forfeited land, emergency debt certificate, local government aid,
164.19job opportunity building zone, special service district, agricultural preserve, tax
164.20increment financing, economic development authority, and special taxing district
164.21provisions; increasing and modifying certain borrowing authorities; modifying
164.22bond allocation provisions; specifying duties of assessors; requiring studies;
164.23providing appointments; appropriating money;amending Minnesota Statutes
164.242008, sections 60A.209, subdivision 1; 82B.035, subdivision 2; 103D.335,
164.25subdivision 17; 270.075, subdivisions 1, 2; 270.41, subdivision 5; 270C.34,
164.26subdivision 1; 270C.52, subdivision 2; 270C.87; 270C.94, subdivision 3;
164.27272.0213; 272.025, subdivisions 1, 3; 272.029, subdivisions 4, 7; 273.061,
164.28subdivisions 7, 8; 273.113, subdivision 3; 273.1231, subdivision 1; 273.1232,
164.29subdivision 1; 273.124, subdivisions 1, 8, 14; 273.13, subdivision 34; 273.1392;
164.30275.71, subdivisions 4, 5; 276.02; 276.112; 279.01, subdivision 3; 279.025;
164.31279.37, subdivision 1; 282.01, subdivisions 1, 1a, 1b, 1c, 1d, 2, 3, 4, 7, 7a, by
164.32adding subdivisions; 289A.08, subdivision 7; 289A.09, subdivision 2; 289A.10,
164.33subdivision 1; 289A.12, subdivision 14; 289A.30, subdivision 2; 289A.50,
164.34subdivisions 2, 4; 289A.60, subdivision 7, by adding a subdivision; 290.014,
164.35subdivision 2; 290.067, subdivision 1; 290.081; 290.0921, subdivision 3; 290.17,
164.36subdivision 2; 290.21, subdivision 4; 290B.03, by adding a subdivision; 290B.04,
164.37subdivisions 3, 4; 290B.05, subdivision 1; 291.03, by adding a subdivision;
164.38295.55, subdivisions 2, 3; 297A.62, as amended; 297A.665; 297A.68,
164.39subdivision 39; 297A.70, subdivision 13; 297A.71, subdivision 23; 297A.99,
164.40subdivision 1; 297A.995, subdivisions 10, 11; 297F.01, subdivision 22a; 297F.04,
164.41by adding a subdivision; 297F.07, subdivision 4; 297F.25, subdivision 1; 297I.01,
164.42subdivision 9; 297I.05, subdivision 7; 297I.30, subdivisions 1, 2, 7, 8; 297I.40,
164.43subdivisions 1, 5; 297I.65, by adding a subdivision; 298.282, subdivision 1;
164.44428A.12; 428A.18, subdivision 2; 469.101, subdivision 1; 469.319, subdivision
164.455; 469.3193; 473.39, by adding a subdivision; 473H.05, subdivision 1; 474A.04,
164.46subdivision 6; 474A.091, subdivision 3; Minnesota Statutes 2009 Supplement,
164.47sections 134.34, subdivision 4; 137.025, subdivision 1; 273.114, subdivision 2;
164.48273.124, subdivision 3a; 273.13, subdivisions 23, 25; 275.065, subdivision 3;
164.49275.70, subdivision 5, as amended; 276.04, subdivision 2; 279.01, subdivision
164.501; 289A.18, subdivision 1; 289A.20, subdivision 4; 290.01, subdivisions 19a,
164.5119b, as amended, 19d; 290.06, subdivision 2c; 290.0671, subdivision 1; 290.091,
164.52subdivision 2; 290B.03, subdivision 1; 291.005, subdivision 1, as amended;
165.1297I.35, subdivision 2; 475.755; 477A.011, subdivision 36, as amended;
165.2477A.013, subdivision 8; Laws 2001, First Special Session chapter 5, article
165.33, section 50, as amended; Laws 2002, chapter 377, article 3, section 25, as
165.4amended; Laws 2009, chapter 88, article 2, section 49; article 4, sections 5; 23,
165.5subdivision 4; Laws 2010, chapter 216, sections 3, subdivision 6; by adding
165.6subdivisions; 4, subdivisions 1, 2, 4, 6, 7, 8; proposing coding for new law
165.7in Minnesota Statutes, chapters 3; 6; 270C; 273; 296A; 524; 645; repealing
165.8Minnesota Statutes 2008, sections 282.01, subdivisions 9, 10, 11; 297I.30,
165.9subdivisions 4, 5, 6; 383A.76."