1.2relating to local government; broadening the application of city special service
1.3districts to include residential and mixed uses;amending Minnesota Statutes
1.42012, sections 428A.08; 428A.09, subdivision 2; Minnesota Statutes 2013
1.5Supplement, section 428A.02, subdivision 1; repealing Minnesota Statutes 2012,
1.6section 428A.01, subdivision 6.
1.7BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.8    Section 1. Minnesota Statutes 2013 Supplement, section 428A.02, subdivision 1,
1.9is amended to read:
1.10    Subdivision 1. Ordinance. The governing body of a city may adopt an ordinance
1.11establishing a special service district. Only property that is classified under section 273.13
1.12and used for commercial, industrial, or public utility purposes, or is vacant land zoned or
1.13designated on a land use plan for commercial or industrial use and located in the special
1.14service district, may be subject to the charges imposed by the city on the special service
1.15district. Other types of property may be included within the boundaries of the special
1.16service district but are not subject to the levies or charges imposed by the city on the
1.17special service district. If 50 percent or more of the estimated market value of a parcel of
1.18property is classified under section 273.13 as commercial, industrial, or vacant land zoned
1.19or designated on a land use plan for commercial or industrial use, or public utility for the
1.20current assessment year, then the entire taxable market value of the property is subject to a
1.21service charge based on net tax capacity for purposes of sections 428A.01 to 428A.10.
1.22 The ordinance shall describe with particularity the area within the city to be included in
1.23the district and the special services to be furnished in the district. The ordinance may not
1.24be adopted until after a public hearing has been held on the question. Notice of the hearing
1.25shall include the time and place of hearing, a map showing the boundaries of the proposed
2.1district, and a statement that all persons owning property in the proposed district that
2.2would be subject to a service charge will be given opportunity to be heard at the hearing.
2.3Within 30 days after adoption of the ordinance under this subdivision, the governing body
2.4shall send a copy of the ordinance to the commissioner of revenue.

2.5    Sec. 2. Minnesota Statutes 2012, section 428A.08, is amended to read:
2.6428A.08 PETITION REQUIRED.
2.7No action may be taken under section 428A.02 or 428A.03, unless owners of 25
2.8percent or more of the land area of property that would be subject to service charges in the
2.9proposed special service district and either: (1) owners of 25 percent or more of the net
2.10tax capacity of property that would be subject to a proposed service charge, based on net
2.11tax capacity; or (2) owners, individuals, and business organizations subject to 25 percent
2.12or more of a proposed service charge based on other than net tax capacity file a petition
2.13requesting a public hearing on the proposed action with the city clerk. If the boundaries of
2.14a proposed district are changed or the land area or net tax capacity subject to a service
2.15charge or the individuals or business organizations subject to a service charge are changed
2.16after the public hearing, a petition meeting the requirements of this section must be filed
2.17with the city clerk before the ordinance establishing the district or resolution imposing
2.18the service charge may become effective.

2.19    Sec. 3. Minnesota Statutes 2012, section 428A.09, subdivision 2, is amended to read:
2.20    Subd. 2. Requirements for veto. If owners of 35 percent or more of the land area
2.21 value in the district subject to the service charge based on net tax capacity or owners,
2.22individuals, and business organizations subject to 35 percent or more of the service
2.23charges to be imposed in the district, file an objection to the ordinance adopted by the city
2.24under section 428A.02 with the city clerk before the effective date of the ordinance, the
2.25ordinance does not become effective. If owners of 35 percent or more of the land area
2.26 value subject to the service charge based on net tax capacity or owners of 35 percent or
2.27more of the net tax capacity subject to the service charge based on net tax capacity file an
2.28objection to the resolution adopted imposing a service charge based on net tax capacity
2.29under section 428A.03 with the city clerk before the effective date of the resolution, the
2.30resolution does not become effective. If owners, individuals, and business organizations
2.31subject to 35 percent or more of the service charges to be imposed in the district file an
2.32objection to the resolution adopted imposing a service charge on a basis other than net
2.33tax capacity under section 428A.03 with the city clerk before the effective date of the
2.34resolution, the resolution does not become effective. In the event of a veto, no district
3.1shall be established during the current calendar year and until a petition meeting the
3.2qualifications set forth in this subdivision for a veto has been filed.

3.3    Sec. 4. REPEALER.
3.4Minnesota Statutes 2012, section 428A.01, subdivision 6, is repealed.