Bill Text: MN HF1911 | 2011-2012 | 87th Legislature | Introduced
Bill Title: Local government levy limits imposed, and property tax increase limits provided or voter approval required.
Sponsorship: Partisan Bill (Republican 2)
Status: (Introduced - Dead) 2012-02-03 - Referred by Chair to Property and Local Tax Division [HF1911 Detail]
Download: Minnesota-2011-HF1911-Introduced.html
1.2relating to taxes; property; imposing levy limits for certain local governments;
1.3providing limits to or requiring voter approval for certain actions that would
1.4increase property taxes;amending Minnesota Statutes 2010, sections 275.62,
1.5subdivision 1; 275.70, subdivision 3; 275.72; 275.73, subdivision 1; 275.74,
1.6subdivisions 1, 3; 275.75; 387.20, subdivision 7; 388.18, subdivision 6; 473.121,
1.7by adding a subdivision; 473.167, subdivision 3; 473.249, subdivision 1;
1.8473.253, subdivision 1; 475.755; proposing coding for new law in Minnesota
1.9Statutes, chapter 275; repealing Minnesota Statutes 2010, sections 275.70,
1.10subdivisions 2, 4, 5, 6; 275.71, subdivisions 1, 2, 4, 5, 6; 275.74, subdivision 2.
1.11BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.12 Section 1. Minnesota Statutes 2010, section 275.62, subdivision 1, is amended to read:
1.13 Subdivision 1. Report on taxes levied. The commissioner of revenue shall establish
1.14procedures for the annual reporting of local government levies. Each local governmental
1.15unit shall submit a report to the commissioner by December 30 of the year in which the
1.16tax is levied. The report shall include, but is not limited to, information on the amount of
1.17the tax levied by the governmental unit for the following purposes:
1.18(1) social services and related programs, which include taxes levied for the purposes
1.19defined in Minnesota Statutes 1991 Supplement, section275.50, subdivision 5 , clauses
1.20(a), (j), and (v);
1.21(2) the amounts levied for each of thepurposes listed in section
275.70, subdivision
1.225
1.23(3) other levies, which include the taxes levied for all purposes not included in
1.24clause (1), (2), or (3).
1.25EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
1.26thereafter, payable in 2013 and thereafter.
2.1 Sec. 2. Minnesota Statutes 2010, section 275.70, subdivision 3, is amended to read:
2.2 Subd. 3. Local governmental unit. "Local governmental unit" means a county,
2.3or a statutory or home rule charter city with a population greater than 2,500, or a special
2.4taxing district under section 275.066.
2.5EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
2.6thereafter, payable in 2013 and thereafter.
2.7 Sec. 3. [275.705] LEVY LIMITS.
2.8 Subdivision 1. Limit on levies. Notwithstanding any other law or municipal charter
2.9to the contrary that authorizes ad valorem taxes in excess of the limits established by
2.10sections 275.70 to 275.74, the provisions of this section apply to local governmental units
2.11for all purposes other than those for special assessments.
2.12 Subd. 2. Preliminary levy limit. For taxes levied in 2012, the preliminary levy
2.13limit for a local governmental unit is equal to (1) the greater of the amount certified to
2.14the county auditor under section 275.07, subdivision 1, for either taxes levied in 2010 or
2.15taxes levied in 2011, multiplied by (2) 1.019. For taxes levied in 2013 and thereafter, the
2.16preliminary levy limit for a local governmental unit is equal to its final levy limit in the
2.17previous year multiplied by 1.019.
2.18 Subd. 3. Final levy limit. For taxes levied in 2012 and thereafter, the final levy limit
2.19for a local governmental unit is equal to its preliminary levy limit under subdivision 2, plus
2.20the amount of any adjustments allowed under subdivisions 4 and 5 and section 297A.72.
2.21 Subd. 4. Debt service adjustment. For taxes levied in 2012 and thereafter,
2.22payable in 2013 and thereafter, a local taxing authority may levy an amount in excess of
2.23the levy certified pursuant to section 275.07, subdivision 1, in 2011, for debt service on
2.24obligations, certificates of indebtedness, capital notes, or other debt instruments sold prior
2.25to May 1, 2012, or to make payments on installment purchase contracts or lease purchase
2.26agreements entered into before May 1, 2012. The adjustment amount that may be levied
2.27must not exceed the difference between (1) what the taxing authority needs to levy for
2.28taxes payable in that year for that purpose and (2) the amount it levied in 2011, payable
2.29in 2012, for that purpose.
2.30 Subd. 5. Election adjustment. A local taxing authority may levy an additional levy
2.31in any amount if approved by a majority of the voters as provided in section 275.73.
2.32 Subd. 6. Levies in excess of levy limits. If the levy made by a local governmental
2.33unit exceeds the final levy limit provided in sections 275.70 to 275.74, except when the
2.34excess is due to the rounding of the rate in accordance with section 275.28, the county
3.1auditor shall only extend the amount of taxes permitted under sections 275.70 to 275.74,
3.2as provided for in section 275.16.
3.3EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
3.4thereafter, payable in 2013 and thereafter.
3.5 Sec. 4. Minnesota Statutes 2010, section 275.72, is amended to read:
3.6275.72 LEVY LIMIT ADJUSTMENTS FOR CONSOLIDATION AND
3.7ANNEXATION.
3.8 Subdivision 1. Adjustments for consolidation. If all of the area included in two
3.9or more local governmental units is consolidated, merged, or otherwise combined to
3.10constitute a single governmental unit, the preliminary levy limitbase for the resulting
3.11governmental unit in the first levy year in which the consolidation is effective shall be
3.12equal to (1)the highest tax rate in any of the merging governmental units in the previous
3.13year multiplied by the net tax capacity of all the merging governmental units in the
3.14previous year, minus the sum of the levies for all the merging local governmental units,
3.15including townships, in the previous year, multiplied by (2)the sum of all levies in the
3.16merging governmental units in the previous year that qualify as special levies under
3.17section
275.70, subdivision 5
3.18 Subd. 2. Adjustments for annexation. If a local governmental unit increases its tax
3.19base through annexation of an area which is not the area of an entire local governmental
3.20unit and the area of annexation contains a population of 50 or more, the final levy limit
3.21base of the local governmental unit in the first year in which the annexation is effective
3.22shall be equal to its final levy limit base established before theadjustment other allowed
3.23adjustments under section275.71, subdivision 3, 275.705 for the current levy year
3.24multiplied by the ratio of the net tax capacity in the local governmental unit after the
3.25annexation compared to its net tax capacity before the annexation.
3.26 Subd. 3. Adjustments for changes in service levels. If a local governmental unit,
3.27as a result of an annexation agreement, has different tax rates in various parts of the
3.28jurisdiction due to different service levels, it may petition the commissioner of revenue to
3.29adjust its levy limits established under section275.71
3.30adjust the levy limits to reflect scheduled changes in tax rates related to increasing service
3.31levels in areas currently receiving less city services. The local governmental unit shall
3.32provide the commissioner with any information the commissioner deems necessary in
3.33making the levy limit adjustment.
4.1 Subd. 4. Transfer of governmental functions. If a function or service of one
4.2local governmental unit is transferred to another local governmental unit, the levy limits
4.3established under section275.71
4.4revenue in such manner so as to fairly and equitably reflect the reduced or increased
4.5property tax burden resulting from the transfer. The aggregate of theadjusted final levy
4.6limitations must not exceed the aggregate of the final levy limitations of the affected local
4.7governmental units prior to adjustment.
4.8 Subd. 5. Effective date for levy limits purposes. Annexations, mergers, and shifts
4.9in services and functional responsibilities that are effective by June 30 of the levy year are
4.10included in the calculation of the levy limit for that levy year. Annexations, mergers, and
4.11shifts in services and functional responsibilities that are effective after June 30 of a levy
4.12year are not included in the calculation of the levy limit until the subsequent levy year.
4.13EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
4.14thereafter, payable in calendar year 2013 and thereafter.
4.15 Sec. 5. Minnesota Statutes 2010, section 275.73, subdivision 1, is amended to read:
4.16 Subdivision 1. Additional levy authorization. Notwithstanding the provisions of
4.17sections275.70 to
275.72 , but subject to other law or charter provisions establishing other
4.18limitations on the amount of property taxes a local governmental unit may levy, a local
4.19governmental unit may levy an additional levyin any amount which. Notwithstanding
4.20the provisions of sections275.70 to
275.72 , but subject to other law or charter provisions
4.21establishing other limitations on the amount of property taxes, a local governmental
4.22unit may levy an additional levy for new debt as required under section 275.735 if it is
4.23approved by the majority of voters of the governmental unit voting on the question at a
4.24general or special election. Notwithstanding the provisions of sections275.70 to
275.72 ,
4.25but subject to other law or charter provisions establishing other limitations on the amount
4.26of property taxes, a local governmental unit may levy an additional levy for a purpose
4.27other than new debt, if it is approved by the voters voting on the question at a general
4.28election or a special election held on the first Tuesday after the first Monday in November
4.29in any year. Notwithstanding section275.61 , any levy authorized under this section must
4.30be levied against net tax capacity unless the levy required voter approval under another
4.31general or special law or any charter provisions. When the governing body of the local
4.32governmental unit resolves to increase the levy pursuant to this section, it shall provide for
4.33submission of the proposition of an additional levy at a general or special election. Notice
4.34of the election must be given in the manner required by law. The notice must state the
4.35purpose and the maximum yearly amount of the additional levy.
5.1 Sec. 6. [275.735] REQUIRING A REFERENDUM BEFORE INCURRING
5.2NEW DEBT.
5.3 Subdivision 1. Actions prohibited. (a) After May 1, 2012, no local taxing authority
5.4may sell obligations, certificates of indebtedness, capital notes, or other debt instruments
5.5under section 412.301, chapter 475, or any other law; nor may it enter into installment
5.6purchase contracts or lease purchase agreements under section 465.71, or any other law
5.7if issuing those debt instruments or entering into those contracts would require a levy
5.8first becoming payable in 2013 or thereafter, unless approved by the voters at a general
5.9or special election under section 275.72.
5.10(b) For purposes of this section, "obligations" includes certificates of indebtedness,
5.11capital notes, other debt instruments, installment purchase contracts, and lease purchase
5.12agreements.
5.13 Subd. 2. Exceptions. This prohibition does not apply to:
5.14(1) refunding bonds sold to refund bonds originally sold before May 1, 2012;
5.15(2) obligations which, when added to the existing obligations of the local
5.16governmental authority, do not cause the authority to increase its total tax levy to pay
5.17for total obligations by more than 1.9 percent of the amount it levied to pay for total
5.18obligations in the previous year; or
5.19(3) obligations with respect to which the local taxing authority makes a finding
5.20at the time of the issuance of the obligation that sufficient funds are available from a
5.21nonproperty tax source to fund the obligation.
5.22 Subd. 3. Date when bonds are deemed sold. For purposes of this section, bonds
5.23are deemed to have been sold before May 1, 2012, if:
5.24(1) an agreement has been entered into between the local taxing authority and a
5.25purchaser or underwriter for the sale of the bonds by that date;
5.26(2) the issuing local taxing authority is a party to a contract or letter of understanding
5.27entered into before May 1, 2012, with the federal or state government that requires the
5.28local taxing authority to pay for a project and the project is funded with the proceeds of
5.29the bonds; or
5.30(3) the proceeds of the bonds are used to fund a project or acquisition with respect
5.31to which the local taxing authority has entered into a contract with a builder or supplier
5.32before May 1, 2012.
5.33EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
5.34thereafter, payable in 2013 and thereafter.
6.1 Sec. 7. [275.736] LIMITATION OF SALARY AND BUDGET APPEAL
6.2AUTHORIZATION.
6.3After May 1, 2012, no county sheriff may exercise the authority granted under
6.4section 387.20, subdivision 7, and no county attorney may exercise the authority granted
6.5under section 388.18, subdivision 6, to the extent that the salary or budget increase sought
6.6in the appeal would result in an increase of more than 1.9 percent in county expenditures in
6.7any calendar year above the level in the previous calendar year for the same purpose. This
6.8provision does not prohibit a county from seeking additional levy authority to increase
6.9county expenditures for these purposes by more than 1.9 percent under section 275.73.
6.10EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
6.11thereafter, payable in 2013 and thereafter.
6.12 Sec. 8. Minnesota Statutes 2010, section 275.74, subdivision 1, is amended to read:
6.13 Subdivision 1. Calculation and notification. The commissioner of revenue shall
6.14make all necessary calculations for determining levy limits for local governmental units
6.15and notify the affected governmental units of their levy limits directly by September 1 of
6.16each levy year. The local governmental units shall, upon request, provide the commissioner
6.17with any information needed to make the calculations. The local governmental unit shall
6.18report by September 30, in a manner prescribed by the commissioner, the maximum
6.19amount of taxes it plans to levyfor each of the purposes listed under special levies and any
6.20additional levy authorized under section
275.73 , along with any necessary documentation.
6.21The commissioner shall review the proposedspecial levies and make any adjustments
6.22needed. The commissioner's decision is final. The finalallowed special levy amounts and
6.23any levy limit adjustments must be certified back to the local governments by December
6.2410. In addition, the commissioner of revenue shall notify all county auditors on or before
6.25five working days after December 20 of the sum of the final levy limitplus the total of
6.26allowed special levies for each local governmental unit located within their boundaries so
6.27that they may fix the levies as required in section275.16 . The local governmental units
6.28shall provide the commissioner of revenue with all information that the commissioner
6.29deems necessary to make the calculations provided for in sections275.70 to
275.73 .
6.30EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
6.31thereafter, payable in 2013 and thereafter.
6.32 Sec. 9. Minnesota Statutes 2010, section 275.74, subdivision 3, is amended to read:
7.1 Subd. 3. Information necessary to calculate final levy limitbase. A local
7.2governmental unit must provide the commissioner with the information required to
7.3calculate the amount under section275.71, subdivision 2, 275.705 by July 20 of the levy
7.4year. If the information is not received by the commissioner by that date, or is not deemed
7.5sufficient to make the calculation under that clause, the commissioner has the discretion
7.6to set the local governmental unit's levy limit for all purposes including those purposes
7.7for whichspecial levies levy adjustments may be made, equal to the amount of the local
7.8governmental unit's certified levy for the prior year.
7.9 Sec. 10. Minnesota Statutes 2010, section 275.75, is amended to read:
7.10275.75 CHARTER EXEMPTION FOR AID LOSS.
7.11Notwithstanding any other provision of a municipal charter that limits ad valorem
7.12taxes to a lesser amount, or that would require voter approval for any increase, the
7.13governing body of a municipality may by resolution increase its levy in any year by an
7.14amount equal toits special levies under section
275.70, subdivision 5, clauses (22) and
7.15(25) any reductions in certified aids or credit reimbursements payable under sections
7.16477A.011 to 477A.014, and section 273.1384, due to unallotments under section 16A.152
7.17or reductions under another provision of law in the previous year.
7.18 Sec. 11. Minnesota Statutes 2010, section 387.20, subdivision 7, is amended to read:
7.19 Subd. 7. Appeal on salary, budget. The sheriff, if dissatisfied with the action of
7.20the county board in setting the amount of the sheriff's salary or the amount of the budget
7.21for the office of sheriff, may, within the limits imposed under section 275.736, appeal to
7.22the district court on the grounds that the determination of the county board in setting
7.23such salary or budget was arbitrary, capricious, oppressive or without sufficiently taking
7.24into account the extent of the responsibilities and duties of said office, and the sheriff's
7.25experience, qualifications, and performance. The appeal shall be taken within 15 days after
7.26the date of the resolution setting such salary or budget by serving a notice of appeal on the
7.27county auditor and filing same with the court administrator of the district court. The court
7.28either in term or vacation and upon ten days' notice to the chair of the board shall hear such
7.29appeal. On the hearing of the appeal the court shall review the decision or resolution of
7.30the board in a hearing de novo and may hear new or additional evidence, or the court may
7.31order the officer appealing and the board to submit briefs or other memoranda and may
7.32dispose of the appeal on such writings. If the court shall find that the board acted in an
7.33arbitrary, capricious, oppressive or unreasonable manner or without sufficiently taking into
7.34account the extent of the responsibilities and duties of the office of the sheriff, the sheriff's
8.1experience, qualifications, and performance, it shall make such order to take the place of
8.2the order appealed from as is justified by the record and shall remand the matter to the
8.3county board for further action consistent with the court's findings. After determination of
8.4the appeal the county board shall proceed in conformity therewith.
8.5EFFECTIVE DATE.This section is effective for budgets and salaries for calendar
8.6year 2013 and thereafter.
8.7 Sec. 12. Minnesota Statutes 2010, section 388.18, subdivision 6, is amended to read:
8.8 Subd. 6. Appeal from resolution of board. The county attorney, if dissatisfied with
8.9the action of the county board in setting the amount of the county attorney's salary or the
8.10amount of the budget for the office of county attorney, may, within the limits imposed
8.11under section 275.736, appeal to the district court on the grounds that the determination of
8.12the county board in setting such salary or budget was arbitrary, capricious, oppressive, or
8.13in unreasonable disregard for the responsibilities and duties of said office, and the county
8.14attorney's experience, qualifications, and performance. The appeal shall be taken within
8.1515 days after the date of the resolution setting such salary or budget by serving a notice of
8.16appeal on the county auditor and filing same with the court administrator of the district
8.17court. The county board may retain special counsel pursuant to section388.09 to represent
8.18it in the appeal proceedings. The court either in term or vacation and upon ten days' notice
8.19to the chair of the board shall hear such appeal. On the hearing of the appeal the court
8.20shall review the decision or resolution of the board in like manner as though reviewed
8.21by certiorari, except new or additional evidence may be taken. The court may order the
8.22officer appealing and the board to submit briefs or other memoranda and may dispose of
8.23the appeal on such writings. If the court shall find that the board acted in an arbitrary,
8.24capricious, oppressive or unreasonable manner it shall remand the matter to the county
8.25board for further action consistent with the court's finding.
8.26EFFECTIVE DATE.This section is effective for budgets and salaries for calendar
8.27year 2013 and thereafter.
8.28 Sec. 13. Minnesota Statutes 2010, section 473.121, is amended by adding a subdivision
8.29to read:
8.30 Subd. 37. Implicit price deflator. "Implicit price deflator" means the implicit
8.31price deflator for government consumption expenditures and gross investment for state
8.32and local governments prepared by the Bureau of Economic Analysis of the United States
8.33Department of Commerce for the 12-month period ending March 31 of the levy year.
9.1 Sec. 14. Minnesota Statutes 2010, section 473.167, subdivision 3, is amended to read:
9.2 Subd. 3. Tax. The council may levy a tax on all taxable property in the metropolitan
9.3area, as defined in section473.121 , to provide funds for loans made pursuant to
9.4subdivisions 2 and 2a. This tax for the right-of-way acquisition loan fund shall be certified
9.5by the council, levied, and collected in the manner provided by section473.13 . The tax
9.6shall be in addition to that authorized by section473.249 and any other law and shall not
9.7affect the amount or rate of taxes which may be levied by the council or any metropolitan
9.8agency or local governmental unit. The amount of the levy shall be as determined and
9.9certified by the council, provided that the tax levied by the Metropolitan Council for the
9.10right-of-way acquisition loan fund shall not exceed $2,828,379 for taxes payable in 2004
9.11and $2,828,379 for taxes payable in 2005. The amount of the levy for taxes payable in
9.122006 and subsequent years shall not exceed the product of (1) the Metropolitan Council's
9.13property tax levy limitation under this subdivision for the previous year, multiplied by
9.14(2) one plus a percentage equal to the growth in the implicit price deflator as defined in
9.15section275.70, subdivision 2
9.16 Sec. 15. Minnesota Statutes 2010, section 473.249, subdivision 1, is amended to read:
9.17 Subdivision 1. Indexed limit. (a) The Metropolitan Council may levy a tax on all
9.18taxable property in the metropolitan area defined in section473.121 to provide funds for
9.19the purposes of sections473.121 to
473.249 and for the purpose of carrying out other
9.20responsibilities of the council as provided by law. This tax for general purposes shall be
9.21levied and collected in the manner provided by section473.13 .
9.22(b) The property tax levied by the Metropolitan Council for general purposes shall
9.23not exceed $10,522,329 for taxes payable in 2004 and $10,522,329 for taxes payable
9.24in 2005.
9.25(c) The property tax levy limitation for general purposes for taxes payable in 2006
9.26and subsequent years shall not exceed the product of: (1) the Metropolitan Council's
9.27property tax levy limitation for general purposes for the previous year determined under
9.28this subdivision multiplied by (2) one plus a percentage equal to the growth in the implicit
9.29price deflator as defined in section275.70, subdivision 2
9.30 Sec. 16. Minnesota Statutes 2010, section 473.253, subdivision 1, is amended to read:
9.31 Subdivision 1. Sources of funds. The council shall credit to the livable communities
9.32demonstration account the revenues provided in this subdivision. This tax shall be levied
9.33and collected in the manner provided by section473.13 . The levy shall not exceed the
9.34following amount for the years specified:
10.1(1) for taxes payable in 2004 and 2005, $8,259,070; and
10.2(2) for taxes payable in 2006 and subsequent years, the product of (i) the property
10.3tax levy limit under this subdivision for the previous year multiplied by (ii) one plus a
10.4percentage equal to the growth in the implicit price deflator as defined in section275.70,
10.5subdivision 2
10.6 Sec. 17. Minnesota Statutes 2010, section 475.755, is amended to read:
10.7475.755 EMERGENCY DEBT CERTIFICATES.
10.8(a) If at any time during a fiscal year the receipts of a local government are
10.9reasonably expected to be reduced below the amount provided in the local government's
10.10budget when the final property tax levy to be collected during the fiscal year was certified
10.11and the receipts are insufficient to meet the expenses incurred or to be incurred during the
10.12fiscal year, the governing body of the local government may authorize and sell certificates
10.13of indebtedness to mature within two years or less from the end of the fiscal year in which
10.14the certificates are issued. The maximum principal amount of the certificates that it may
10.15issue in a fiscal year is limited to the expected reduction in receipts plus the cost of
10.16issuance. The certificates may be issued in the manner and on the terms the governing
10.17body determines by resolution.
10.18(b) The governing body of the local government shall levy taxes for the payment of
10.19principal and interest on the certificates in accordance with section475.61 .
10.20(c) The certificates are not to be included in the net debt of the issuing local
10.21government.
10.22(d) To the extent that a local government issues certificates under this section to fund
10.23an unallotment or other reduction in its state aid, the local government must not use the
10.24special levy authority for aid reductions under section
275.70, subdivision 5, clause (22),
10.25or a similar or successor provision, but must instead use the special levy authority for
10.26the repayment of indebtedness under section
275.70, subdivision 5, clause (2), in order
10.27to levy under section
475.61 to fund repayment of the certificates with a levy that is
10.28not subject to levy limits.
10.29(e) (d) For purposes of this section, the following terms have the meanings given:
10.30(1) "Local government" means a statutory or home rule charter city, a town, or
10.31a county.
10.32(2) "Receipts" includes the following amounts scheduled to be received by the
10.33local government for the fiscal year from:
10.34(i) taxes;
10.35(ii) aid payments previously certified by the state to be paid to the local government;
11.1(iii) state reimbursement payments for property tax credits; and
11.2(iv) any other source.
11.3 Sec. 18. SAVINGS CLAUSE.
11.4Notwithstanding any provision in this act, the provisions of this act neither constitute
11.5an impairment of any obligation, certificate of indebtedness, capital note, or other debt
11.6instrument sold prior to May 1, 2012, nor does it constitute an impairment on the ability
11.7of a local taxing authority to make payments on installment purchase contracts or lease
11.8purchase agreements entered into by a local taxing authority before May 1, 2012.
11.9EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
11.10thereafter, payable in 2013 and thereafter.
11.11 Sec. 19. REPEALER.
11.12Minnesota Statutes 2010, sections 275.70, subdivisions 2, 4, 5, and 6; 275.71,
11.13subdivisions 1, 2, 4, 5, and 6; and 275.74, subdivision 2, are repealed.
11.14EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
11.15thereafter, payable in 2013 and thereafter.
1.3providing limits to or requiring voter approval for certain actions that would
1.4increase property taxes;amending Minnesota Statutes 2010, sections 275.62,
1.5subdivision 1; 275.70, subdivision 3; 275.72; 275.73, subdivision 1; 275.74,
1.6subdivisions 1, 3; 275.75; 387.20, subdivision 7; 388.18, subdivision 6; 473.121,
1.7by adding a subdivision; 473.167, subdivision 3; 473.249, subdivision 1;
1.8473.253, subdivision 1; 475.755; proposing coding for new law in Minnesota
1.9Statutes, chapter 275; repealing Minnesota Statutes 2010, sections 275.70,
1.10subdivisions 2, 4, 5, 6; 275.71, subdivisions 1, 2, 4, 5, 6; 275.74, subdivision 2.
1.11BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.12 Section 1. Minnesota Statutes 2010, section 275.62, subdivision 1, is amended to read:
1.13 Subdivision 1. Report on taxes levied. The commissioner of revenue shall establish
1.14procedures for the annual reporting of local government levies. Each local governmental
1.15unit shall submit a report to the commissioner by December 30 of the year in which the
1.16tax is levied. The report shall include, but is not limited to, information on the amount of
1.17the tax levied by the governmental unit for the following purposes:
1.18(1) social services and related programs, which include taxes levied for the purposes
1.19defined in Minnesota Statutes 1991 Supplement, section
1.20(a), (j), and (v);
1.21(2) the amounts levied for each of the
1.22
1.23(3) other levies, which include the taxes levied for all purposes not included in
1.24clause (1), (2), or (3).
1.25EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
1.26thereafter, payable in 2013 and thereafter.
2.1 Sec. 2. Minnesota Statutes 2010, section 275.70, subdivision 3, is amended to read:
2.2 Subd. 3. Local governmental unit. "Local governmental unit" means a county,
2.3
2.4taxing district under section 275.066.
2.5EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
2.6thereafter, payable in 2013 and thereafter.
2.7 Sec. 3. [275.705] LEVY LIMITS.
2.8 Subdivision 1. Limit on levies. Notwithstanding any other law or municipal charter
2.9to the contrary that authorizes ad valorem taxes in excess of the limits established by
2.10sections 275.70 to 275.74, the provisions of this section apply to local governmental units
2.11for all purposes other than those for special assessments.
2.12 Subd. 2. Preliminary levy limit. For taxes levied in 2012, the preliminary levy
2.13limit for a local governmental unit is equal to (1) the greater of the amount certified to
2.14the county auditor under section 275.07, subdivision 1, for either taxes levied in 2010 or
2.15taxes levied in 2011, multiplied by (2) 1.019. For taxes levied in 2013 and thereafter, the
2.16preliminary levy limit for a local governmental unit is equal to its final levy limit in the
2.17previous year multiplied by 1.019.
2.18 Subd. 3. Final levy limit. For taxes levied in 2012 and thereafter, the final levy limit
2.19for a local governmental unit is equal to its preliminary levy limit under subdivision 2, plus
2.20the amount of any adjustments allowed under subdivisions 4 and 5 and section 297A.72.
2.21 Subd. 4. Debt service adjustment. For taxes levied in 2012 and thereafter,
2.22payable in 2013 and thereafter, a local taxing authority may levy an amount in excess of
2.23the levy certified pursuant to section 275.07, subdivision 1, in 2011, for debt service on
2.24obligations, certificates of indebtedness, capital notes, or other debt instruments sold prior
2.25to May 1, 2012, or to make payments on installment purchase contracts or lease purchase
2.26agreements entered into before May 1, 2012. The adjustment amount that may be levied
2.27must not exceed the difference between (1) what the taxing authority needs to levy for
2.28taxes payable in that year for that purpose and (2) the amount it levied in 2011, payable
2.29in 2012, for that purpose.
2.30 Subd. 5. Election adjustment. A local taxing authority may levy an additional levy
2.31in any amount if approved by a majority of the voters as provided in section 275.73.
2.32 Subd. 6. Levies in excess of levy limits. If the levy made by a local governmental
2.33unit exceeds the final levy limit provided in sections 275.70 to 275.74, except when the
2.34excess is due to the rounding of the rate in accordance with section 275.28, the county
3.1auditor shall only extend the amount of taxes permitted under sections 275.70 to 275.74,
3.2as provided for in section 275.16.
3.3EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
3.4thereafter, payable in 2013 and thereafter.
3.5 Sec. 4. Minnesota Statutes 2010, section 275.72, is amended to read:
3.6275.72 LEVY LIMIT ADJUSTMENTS FOR CONSOLIDATION AND
3.7ANNEXATION.
3.8 Subdivision 1. Adjustments for consolidation. If all of the area included in two
3.9or more local governmental units is consolidated, merged, or otherwise combined to
3.10constitute a single governmental unit, the preliminary levy limit
3.11governmental unit in the first levy year in which the consolidation is effective shall be
3.12equal to (1)
3.13
3.14
3.15including townships, in the previous year, multiplied by (2)
3.16
3.17
3.18 Subd. 2. Adjustments for annexation. If a local governmental unit increases its tax
3.19base through annexation of an area which is not the area of an entire local governmental
3.20unit and the area of annexation contains a population of 50 or more, the final levy limit
3.21base of the local governmental unit in the first year in which the annexation is effective
3.22shall be equal to its final levy limit base established before the
3.23adjustments under section
3.24multiplied by the ratio of the net tax capacity in the local governmental unit after the
3.25annexation compared to its net tax capacity before the annexation.
3.26 Subd. 3. Adjustments for changes in service levels. If a local governmental unit,
3.27as a result of an annexation agreement, has different tax rates in various parts of the
3.28jurisdiction due to different service levels, it may petition the commissioner of revenue to
3.29adjust its levy limits established under section
3.30adjust the levy limits to reflect scheduled changes in tax rates related to increasing service
3.31levels in areas currently receiving less city services. The local governmental unit shall
3.32provide the commissioner with any information the commissioner deems necessary in
3.33making the levy limit adjustment.
4.1 Subd. 4. Transfer of governmental functions. If a function or service of one
4.2local governmental unit is transferred to another local governmental unit, the levy limits
4.3established under section
4.4revenue in such manner so as to fairly and equitably reflect the reduced or increased
4.5property tax burden resulting from the transfer. The aggregate of the
4.6limitations must not exceed the aggregate of the final levy limitations of the affected local
4.7governmental units prior to adjustment.
4.8 Subd. 5. Effective date for levy limits purposes. Annexations, mergers, and shifts
4.9in services and functional responsibilities that are effective by June 30 of the levy year are
4.10included in the calculation of the levy limit for that levy year. Annexations, mergers, and
4.11shifts in services and functional responsibilities that are effective after June 30 of a levy
4.12year are not included in the calculation of the levy limit until the subsequent levy year.
4.13EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
4.14thereafter, payable in calendar year 2013 and thereafter.
4.15 Sec. 5. Minnesota Statutes 2010, section 275.73, subdivision 1, is amended to read:
4.16 Subdivision 1. Additional levy authorization. Notwithstanding the provisions of
4.17sections
4.18limitations on the amount of property taxes a local governmental unit may levy, a local
4.19governmental unit may levy an additional levy
4.20the provisions of sections
4.21establishing other limitations on the amount of property taxes, a local governmental
4.22unit may levy an additional levy for new debt as required under section 275.735 if it is
4.23approved by the majority of voters of the governmental unit voting on the question at a
4.24general or special election. Notwithstanding the provisions of sections
4.25but subject to other law or charter provisions establishing other limitations on the amount
4.26of property taxes, a local governmental unit may levy an additional levy for a purpose
4.27other than new debt, if it is approved by the voters voting on the question at a general
4.28election or a special election held on the first Tuesday after the first Monday in November
4.29in any year. Notwithstanding section
4.30be levied against net tax capacity unless the levy required voter approval under another
4.31general or special law or any charter provisions. When the governing body of the local
4.32governmental unit resolves to increase the levy pursuant to this section, it shall provide for
4.33submission of the proposition of an additional levy at a general or special election. Notice
4.34of the election must be given in the manner required by law. The notice must state the
4.35purpose and the maximum yearly amount of the additional levy.
5.1 Sec. 6. [275.735] REQUIRING A REFERENDUM BEFORE INCURRING
5.2NEW DEBT.
5.3 Subdivision 1. Actions prohibited. (a) After May 1, 2012, no local taxing authority
5.4may sell obligations, certificates of indebtedness, capital notes, or other debt instruments
5.5under section 412.301, chapter 475, or any other law; nor may it enter into installment
5.6purchase contracts or lease purchase agreements under section 465.71, or any other law
5.7if issuing those debt instruments or entering into those contracts would require a levy
5.8first becoming payable in 2013 or thereafter, unless approved by the voters at a general
5.9or special election under section 275.72.
5.10(b) For purposes of this section, "obligations" includes certificates of indebtedness,
5.11capital notes, other debt instruments, installment purchase contracts, and lease purchase
5.12agreements.
5.13 Subd. 2. Exceptions. This prohibition does not apply to:
5.14(1) refunding bonds sold to refund bonds originally sold before May 1, 2012;
5.15(2) obligations which, when added to the existing obligations of the local
5.16governmental authority, do not cause the authority to increase its total tax levy to pay
5.17for total obligations by more than 1.9 percent of the amount it levied to pay for total
5.18obligations in the previous year; or
5.19(3) obligations with respect to which the local taxing authority makes a finding
5.20at the time of the issuance of the obligation that sufficient funds are available from a
5.21nonproperty tax source to fund the obligation.
5.22 Subd. 3. Date when bonds are deemed sold. For purposes of this section, bonds
5.23are deemed to have been sold before May 1, 2012, if:
5.24(1) an agreement has been entered into between the local taxing authority and a
5.25purchaser or underwriter for the sale of the bonds by that date;
5.26(2) the issuing local taxing authority is a party to a contract or letter of understanding
5.27entered into before May 1, 2012, with the federal or state government that requires the
5.28local taxing authority to pay for a project and the project is funded with the proceeds of
5.29the bonds; or
5.30(3) the proceeds of the bonds are used to fund a project or acquisition with respect
5.31to which the local taxing authority has entered into a contract with a builder or supplier
5.32before May 1, 2012.
5.33EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
5.34thereafter, payable in 2013 and thereafter.
6.1 Sec. 7. [275.736] LIMITATION OF SALARY AND BUDGET APPEAL
6.2AUTHORIZATION.
6.3After May 1, 2012, no county sheriff may exercise the authority granted under
6.4section 387.20, subdivision 7, and no county attorney may exercise the authority granted
6.5under section 388.18, subdivision 6, to the extent that the salary or budget increase sought
6.6in the appeal would result in an increase of more than 1.9 percent in county expenditures in
6.7any calendar year above the level in the previous calendar year for the same purpose. This
6.8provision does not prohibit a county from seeking additional levy authority to increase
6.9county expenditures for these purposes by more than 1.9 percent under section 275.73.
6.10EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
6.11thereafter, payable in 2013 and thereafter.
6.12 Sec. 8. Minnesota Statutes 2010, section 275.74, subdivision 1, is amended to read:
6.13 Subdivision 1. Calculation and notification. The commissioner of revenue shall
6.14make all necessary calculations for determining levy limits for local governmental units
6.15and notify the affected governmental units of their levy limits directly by September 1 of
6.16each levy year. The local governmental units shall, upon request, provide the commissioner
6.17with any information needed to make the calculations. The local governmental unit shall
6.18report by September 30, in a manner prescribed by the commissioner, the maximum
6.19amount of taxes it plans to levy
6.20
6.21The commissioner shall review the proposed
6.22needed. The commissioner's decision is final. The final
6.23any levy limit adjustments must be certified back to the local governments by December
6.2410. In addition, the commissioner of revenue shall notify all county auditors on or before
6.25five working days after December 20 of the sum of the final levy limit
6.26
6.27that they may fix the levies as required in section
6.28shall provide the commissioner of revenue with all information that the commissioner
6.29deems necessary to make the calculations provided for in sections
6.30EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
6.31thereafter, payable in 2013 and thereafter.
6.32 Sec. 9. Minnesota Statutes 2010, section 275.74, subdivision 3, is amended to read:
7.1 Subd. 3. Information necessary to calculate final levy limit
7.2governmental unit must provide the commissioner with the information required to
7.3calculate the amount under section
7.4year. If the information is not received by the commissioner by that date, or is not deemed
7.5sufficient to make the calculation under that clause, the commissioner has the discretion
7.6to set the local governmental unit's levy limit for all purposes including those purposes
7.7for which
7.8governmental unit's certified levy for the prior year.
7.9 Sec. 10. Minnesota Statutes 2010, section 275.75, is amended to read:
7.10275.75 CHARTER EXEMPTION FOR AID LOSS.
7.11Notwithstanding any other provision of a municipal charter that limits ad valorem
7.12taxes to a lesser amount, or that would require voter approval for any increase, the
7.13governing body of a municipality may by resolution increase its levy in any year by an
7.14amount equal to
7.15
7.16477A.011 to 477A.014, and section 273.1384, due to unallotments under section 16A.152
7.17or reductions under another provision of law in the previous year.
7.18 Sec. 11. Minnesota Statutes 2010, section 387.20, subdivision 7, is amended to read:
7.19 Subd. 7. Appeal on salary, budget. The sheriff, if dissatisfied with the action of
7.20the county board in setting the amount of the sheriff's salary or the amount of the budget
7.21for the office of sheriff, may, within the limits imposed under section 275.736, appeal to
7.22the district court on the grounds that the determination of the county board in setting
7.23such salary or budget was arbitrary, capricious, oppressive or without sufficiently taking
7.24into account the extent of the responsibilities and duties of said office, and the sheriff's
7.25experience, qualifications, and performance. The appeal shall be taken within 15 days after
7.26the date of the resolution setting such salary or budget by serving a notice of appeal on the
7.27county auditor and filing same with the court administrator of the district court. The court
7.28either in term or vacation and upon ten days' notice to the chair of the board shall hear such
7.29appeal. On the hearing of the appeal the court shall review the decision or resolution of
7.30the board in a hearing de novo and may hear new or additional evidence, or the court may
7.31order the officer appealing and the board to submit briefs or other memoranda and may
7.32dispose of the appeal on such writings. If the court shall find that the board acted in an
7.33arbitrary, capricious, oppressive or unreasonable manner or without sufficiently taking into
7.34account the extent of the responsibilities and duties of the office of the sheriff, the sheriff's
8.1experience, qualifications, and performance, it shall make such order to take the place of
8.2the order appealed from as is justified by the record and shall remand the matter to the
8.3county board for further action consistent with the court's findings. After determination of
8.4the appeal the county board shall proceed in conformity therewith.
8.5EFFECTIVE DATE.This section is effective for budgets and salaries for calendar
8.6year 2013 and thereafter.
8.7 Sec. 12. Minnesota Statutes 2010, section 388.18, subdivision 6, is amended to read:
8.8 Subd. 6. Appeal from resolution of board. The county attorney, if dissatisfied with
8.9the action of the county board in setting the amount of the county attorney's salary or the
8.10amount of the budget for the office of county attorney, may, within the limits imposed
8.11under section 275.736, appeal to the district court on the grounds that the determination of
8.12the county board in setting such salary or budget was arbitrary, capricious, oppressive, or
8.13in unreasonable disregard for the responsibilities and duties of said office, and the county
8.14attorney's experience, qualifications, and performance. The appeal shall be taken within
8.1515 days after the date of the resolution setting such salary or budget by serving a notice of
8.16appeal on the county auditor and filing same with the court administrator of the district
8.17court. The county board may retain special counsel pursuant to section
8.18it in the appeal proceedings. The court either in term or vacation and upon ten days' notice
8.19to the chair of the board shall hear such appeal. On the hearing of the appeal the court
8.20shall review the decision or resolution of the board in like manner as though reviewed
8.21by certiorari, except new or additional evidence may be taken. The court may order the
8.22officer appealing and the board to submit briefs or other memoranda and may dispose of
8.23the appeal on such writings. If the court shall find that the board acted in an arbitrary,
8.24capricious, oppressive or unreasonable manner it shall remand the matter to the county
8.25board for further action consistent with the court's finding.
8.26EFFECTIVE DATE.This section is effective for budgets and salaries for calendar
8.27year 2013 and thereafter.
8.28 Sec. 13. Minnesota Statutes 2010, section 473.121, is amended by adding a subdivision
8.29to read:
8.30 Subd. 37. Implicit price deflator. "Implicit price deflator" means the implicit
8.31price deflator for government consumption expenditures and gross investment for state
8.32and local governments prepared by the Bureau of Economic Analysis of the United States
8.33Department of Commerce for the 12-month period ending March 31 of the levy year.
9.1 Sec. 14. Minnesota Statutes 2010, section 473.167, subdivision 3, is amended to read:
9.2 Subd. 3. Tax. The council may levy a tax on all taxable property in the metropolitan
9.3area, as defined in section
9.4subdivisions 2 and 2a. This tax for the right-of-way acquisition loan fund shall be certified
9.5by the council, levied, and collected in the manner provided by section
9.6shall be in addition to that authorized by section
9.7affect the amount or rate of taxes which may be levied by the council or any metropolitan
9.8agency or local governmental unit. The amount of the levy shall be as determined and
9.9certified by the council, provided that the tax levied by the Metropolitan Council for the
9.10right-of-way acquisition loan fund shall not exceed $2,828,379 for taxes payable in 2004
9.11and $2,828,379 for taxes payable in 2005. The amount of the levy for taxes payable in
9.122006 and subsequent years shall not exceed the product of (1) the Metropolitan Council's
9.13property tax levy limitation under this subdivision for the previous year, multiplied by
9.14(2) one plus a percentage equal to the growth in the implicit price deflator as defined in
9.15section
9.16 Sec. 15. Minnesota Statutes 2010, section 473.249, subdivision 1, is amended to read:
9.17 Subdivision 1. Indexed limit. (a) The Metropolitan Council may levy a tax on all
9.18taxable property in the metropolitan area defined in section
9.19the purposes of sections
9.20responsibilities of the council as provided by law. This tax for general purposes shall be
9.21levied and collected in the manner provided by section
9.22(b) The property tax levied by the Metropolitan Council for general purposes shall
9.23not exceed $10,522,329 for taxes payable in 2004 and $10,522,329 for taxes payable
9.24in 2005.
9.25(c) The property tax levy limitation for general purposes for taxes payable in 2006
9.26and subsequent years shall not exceed the product of: (1) the Metropolitan Council's
9.27property tax levy limitation for general purposes for the previous year determined under
9.28this subdivision multiplied by (2) one plus a percentage equal to the growth in the implicit
9.29price deflator as defined in section
9.30 Sec. 16. Minnesota Statutes 2010, section 473.253, subdivision 1, is amended to read:
9.31 Subdivision 1. Sources of funds. The council shall credit to the livable communities
9.32demonstration account the revenues provided in this subdivision. This tax shall be levied
9.33and collected in the manner provided by section
9.34following amount for the years specified:
10.1(1) for taxes payable in 2004 and 2005, $8,259,070; and
10.2(2) for taxes payable in 2006 and subsequent years, the product of (i) the property
10.3tax levy limit under this subdivision for the previous year multiplied by (ii) one plus a
10.4percentage equal to the growth in the implicit price deflator as defined in section
10.5
10.6 Sec. 17. Minnesota Statutes 2010, section 475.755, is amended to read:
10.7475.755 EMERGENCY DEBT CERTIFICATES.
10.8(a) If at any time during a fiscal year the receipts of a local government are
10.9reasonably expected to be reduced below the amount provided in the local government's
10.10budget when the final property tax levy to be collected during the fiscal year was certified
10.11and the receipts are insufficient to meet the expenses incurred or to be incurred during the
10.12fiscal year, the governing body of the local government may authorize and sell certificates
10.13of indebtedness to mature within two years or less from the end of the fiscal year in which
10.14the certificates are issued. The maximum principal amount of the certificates that it may
10.15issue in a fiscal year is limited to the expected reduction in receipts plus the cost of
10.16issuance. The certificates may be issued in the manner and on the terms the governing
10.17body determines by resolution.
10.18(b) The governing body of the local government shall levy taxes for the payment of
10.19principal and interest on the certificates in accordance with section
10.20(c) The certificates are not to be included in the net debt of the issuing local
10.21government.
10.22
10.23
10.24
10.25
10.26
10.27
10.28
10.29
10.30(1) "Local government" means a statutory or home rule charter city, a town, or
10.31a county.
10.32(2) "Receipts" includes the following amounts scheduled to be received by the
10.33local government for the fiscal year from:
10.34(i) taxes;
10.35(ii) aid payments previously certified by the state to be paid to the local government;
11.1(iii) state reimbursement payments for property tax credits; and
11.2(iv) any other source.
11.3 Sec. 18. SAVINGS CLAUSE.
11.4Notwithstanding any provision in this act, the provisions of this act neither constitute
11.5an impairment of any obligation, certificate of indebtedness, capital note, or other debt
11.6instrument sold prior to May 1, 2012, nor does it constitute an impairment on the ability
11.7of a local taxing authority to make payments on installment purchase contracts or lease
11.8purchase agreements entered into by a local taxing authority before May 1, 2012.
11.9EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
11.10thereafter, payable in 2013 and thereafter.
11.11 Sec. 19. REPEALER.
11.12Minnesota Statutes 2010, sections 275.70, subdivisions 2, 4, 5, and 6; 275.71,
11.13subdivisions 1, 2, 4, 5, and 6; and 275.74, subdivision 2, are repealed.
11.14EFFECTIVE DATE.This section is effective for taxes levied in 2012 and
11.15thereafter, payable in 2013 and thereafter.
