Bill Text: MN HF3167 | 2013-2014 | 88th Legislature | Engrossed


Bill Title: Omnibus supplemental tax bill.

Spectrum: Slight Partisan Bill (Democrat 3-1)

Status: (Passed) 2014-05-20 - Secretary of State Chapter 308 [HF3167 Detail]

Download: Minnesota-2013-HF3167-Engrossed.html

1.1A bill for an act
1.2relating to financing and operation of state and local government; making changes
1.3to individual income, property, sales and use, excise, estate, mineral, tobacco,
1.4alcohol, special, local, and other taxes and tax-related provisions; providing for
1.5and increasing credits and refunds; modifying local government aids; modifying
1.6property tax exclusions, exemptions, and levy deadlines; imposing a tax on
1.7solar energy production; modifying installment payments; modifying special
1.8service districts; modifying sales, use, and excise tax incentives and exemptions;
1.9changing certain sales, use, and excise tax remittances; modifying and allowing
1.10certain local sales and use taxes; providing for voluntary compliance; modifying
1.11income tax credits and subtractions; clarifying estate tax provisions; modifying
1.12minerals tax provisions; reallocating certain bond payments; providing for
1.13certain local development projects; modifying tax increment finance rules;
1.14authorizing debt service aid and local bonding authority; designating the "Old
1.15Cedar Avenue Bridge"; changing license revocation procedures; modifying
1.16certain county levy authority; removing obsolete, redundant, and unnecessary
1.17laws and administrative rules administered by the Department of Revenue;
1.18making various policy and technical changes; requiring reports; appropriating
1.19money;amending Minnesota Statutes 2012, sections 16D.02, subdivisions 3,
1.206; 16D.04, subdivisions 3, 4; 16D.07; 16D.11, subdivisions 1, 3, 7; 84A.20,
1.21subdivision 2; 84A.31, subdivision 2; 115B.49, subdivision 4; 116J.8737,
1.22subdivision 5, as amended, by adding a subdivision; 161.14, by adding a
1.23subdivision; 163.06, subdivision 1; 270.11, subdivision 1; 270.12, subdivisions 2,
1.244; 270.87; 270A.03, subdivision 2; 270B.14, subdivision 3; 270C.085; 270C.34,
1.25subdivision 2; 270C.52, subdivision 2; 270C.56, subdivision 3; 270C.72,
1.26subdivisions 1, 3; 272.01, subdivisions 1, 3; 272.02, subdivisions 10, 24, 93;
1.27272.0211, subdivisions 1, 2, 4; 272.025, subdivision 1; 272.027, subdivision 1;
1.28272.029, subdivisions 4a, 6; 272.03, subdivision 1; 273.01; 273.061, subdivision
1.296; 273.10; 273.11, subdivision 13; 273.112, subdivision 6a; 273.13, subdivision
1.3034; 273.1384, subdivision 2; 273.18; 273.33, subdivision 2; 273.37, subdivision
1.312; 273.3711; 274.01, subdivisions 1, 2; 274.014, subdivision 3; 275.065,
1.32subdivision 1; 275.08, subdivisions 1a, 1d; 275.74, subdivision 2; 275.75;
1.33276A.06, subdivisions 3, as amended, 5, as amended; 279.03, subdivisions 1, 1a,
1.342; 279.16; 279.23; 279.25; 280.001; 280.03; 280.07; 280.11; 281.03; 281.327;
1.35282.01, subdivision 6; 282.04, subdivision 4; 282.261, subdivisions 2, 4, 5;
1.36282.322; 287.30; 289A.02, subdivision 7, as amended; 289A.18, subdivision
1.372; 289A.25, subdivision 1; 289A.60, subdivision 15; 290.01, subdivisions 5,
1.3819a, as amended, 19f, 29; 290.015, subdivision 1; 290.07, subdivisions 1, 2;
1.39290.081; 290.0922, subdivision 3; 290.095, subdivision 3; 290.9728, subdivision
2.12; 291.016, subdivision 1, as added; 291.031, as added; 296A.01, subdivision
2.216; 297A.67, subdivision 13a, by adding a subdivision; 297A.68, by adding
2.3a subdivision; 297A.70, subdivision 10, by adding a subdivision; 297A.94;
2.4297B.09; 297F.03, subdivision 2; 297F.09, subdivision 10; 297G.03, by adding
2.5a subdivision; 297G.09, subdivision 9; 297H.06, subdivision 2; 297I.05,
2.6subdivision 14; 298.28, subdivisions 5, as amended, 7a, as added; 298.75,
2.7subdivisions 1, 2; 383D.41, by adding a subdivision; 383E.21, subdivisions
2.81, 2; 412.131; 469.176, subdivisions 1b, 3; 469.1763, subdivision 3; 469.177,
2.9subdivision 3; 473.665, subdivision 5; 477A.0124, subdivision 5; 477A.014,
2.10subdivision 1; 611.27, subdivisions 13, 15; Minnesota Statutes 2013 Supplement,
2.11sections 116J.8737, subdivision 2, as amended; 116J.8738, subdivisions 2, 3,
2.124; 116V.03; 136A.129, subdivisions 1, 3, 5; 144F.01, subdivision 4; 270B.01,
2.13subdivision 8; 270B.03, subdivision 1; 273.13, subdivision 25; 273.1325,
2.14subdivisions 1, 2; 273.1398, subdivisions 3, 4; 275.70, subdivision 5; 279.37,
2.15subdivision 2; 281.17; 289A.20, subdivision 4; 290.01, subdivisions 19, as
2.16amended, 19b, as amended, 19d, 31, as amended; 290.091, subdivision 2, as
2.17amended; 290.0921, subdivision 3; 290.191, subdivision 5; 290A.03, subdivision
2.1815, as amended; 291.005, subdivision 1, as amended; 297A.61, subdivision 3,
2.19as amended; 297A.68, subdivisions 42, 44; 297A.70, subdivisions 2, 13, 14;
2.20297A.75, subdivisions 1, 2, 3; 297F.05, subdivision 1; 298.018, subdivision
2.211; 298.28, subdivision 10, as amended; 360.531, subdivision 2; 403.162,
2.22subdivision 5; 423A.02, subdivision 3; 423A.022, subdivisions 2, 3; 465.04;
2.23469.1763, subdivision 2; 477A.013, subdivision 8; 477A.03, subdivision 2a;
2.24477A.12, subdivisions 1, 2; 477A.14, subdivision 1; Laws 1980, chapter 511,
2.25sections 1, subdivision 2, as amended; 2, as amended; Laws 1999, chapter 243,
2.26article 14, section 5, subdivision 1; Laws 2005, First Special Session chapter 3,
2.27article 5, sections 38, subdivision 4; 44, subdivisions 3, 5; Laws 2006, chapter
2.28259, article 3, sections 10, subdivisions 3, 4, 5; 11, subdivisions 3, 4, 5; Laws
2.292008, chapter 366, article 10, section 15; Laws 2013, chapter 143, article 8,
2.30sections 3; 22; 23; 27; 37; article 9, section 23; article 11, section 10; Laws 2014,
2.31chapter 150, article 3, section 4; proposing coding for new law in Minnesota
2.32Statutes, chapters 69; 272; 297G; 383A; 469; 477A; repealing Minnesota Statutes
2.332012, sections 16D.02, subdivisions 5, 8; 16D.11, subdivision 2; 270C.53;
2.34270C.991, subdivision 4; 272.02, subdivisions 1, 1a, 43, 48, 51, 53, 67, 72, 82;
2.35272.027, subdivision 2; 272.031; 273.015, subdivision 1; 273.03, subdivision 3;
2.36273.075; 273.13, subdivision 21a; 273.1383; 273.1386; 273.1398, subdivision
2.374b; 273.80; 275.77; 279.32; 281.173, subdivision 8; 281.174, subdivision 8;
2.38281.328; 282.10; 282.23; 287.20, subdivision 4; 287.27, subdivision 2; 289A.56,
2.39subdivision 7; 290.01, subdivisions 4b, 19e, 20e; 290.06, subdivisions 30, 31;
2.40290.0674, subdivision 3; 290.191, subdivision 4; 290.33; 295.52, subdivision
2.417; 297A.666; 297A.68, subdivision 38; 297A.71, subdivisions 4, 5, 7, 9, 10,
2.4217, 18, 20, 32, 41; 297F.08, subdivision 11; 297H.10, subdivision 2; 469.174,
2.43subdivision 10c; 469.175, subdivision 2b; 469.176, subdivision 1i; 469.1764;
2.44469.177, subdivision 10; 469.330; 469.331; 469.332; 469.333; 469.334; 469.335;
2.45469.336; 469.337; 469.338; 469.339; 469.340, subdivisions 1, 2, 3, 5; 469.341;
2.46477A.0124, subdivisions 1, 6; 505.173; Minnesota Statutes 2013 Supplement,
2.47sections 273.1103; 469.340, subdivision 4; Laws 1993, chapter 375, article 9,
2.48section 47; Minnesota Rules, parts 8002.0200, subpart 8; 8007.0200; 8100.0800;
2.498130.7500, subpart 7; 8130.8900, subpart 3; 8130.9500, subparts 1, 1a, 2, 3, 4, 5.
2.50BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

2.51ARTICLE 1
2.52PROPERTY TAX AIDS AND CREDITS

2.53    Section 1. [69.022] VOLUNTEER RETENTION STIPEND AID PILOT.
3.1    Subdivision 1. Definitions. (a) For purposes of this section, the following terms
3.2have the meanings given them.
3.3(b) "Commissioner," unless otherwise specified, means the commissioner of public
3.4safety.
3.5(c) "Emergency medical services provider" means a licensee as defined under
3.6section 144E.001, subdivision 8.
3.7(d) "Independent nonprofit firefighting corporation" has the same meaning as used in
3.8chapter 424A.
3.9(e) "Municipality" has the meaning given in section 69.011, but only if the
3.10municipality uses one or more qualified volunteers to provide service.
3.11(f) "Qualified entity" means an emergency medical services provider, independent
3.12nonprofit firefighting corporation, or municipality.
3.13(g) "Qualified volunteer" means one of the following types of volunteers who has
3.14provided service, for the entire prior calendar year, to one or more qualified entities:
3.15(1) a volunteer firefighter as defined in section 299N.03, subdivision 7;
3.16(2) a volunteer ambulance attendant as defined in section 144E.001, subdivision 15; or
3.17(3) an emergency medical responder as defined in section 144E.001, subdivision 6,
3.18who provides emergency medical services as a volunteer.
3.19(h) "Pilot area" means the following groups of counties:
3.20(1) southern Minnesota, consisting of the counties of Faribault, Fillmore, Freeborn,
3.21Houston, and Watonwan;
3.22(2) west central Minnesota, consisting of the counties of Chippewa, Kandiyohi,
3.23Redwood, and Renville;
3.24(3) central Minnesota, consisting of the counties of Morrison and Todd; and
3.25(4) north central Minnesota, consisting of the counties of Beltrami, Clearwater,
3.26and Mahnomen.
3.27    Subd. 2. Certification. By June 1 of the calendar year following the year in
3.28which the qualified volunteer provided service, the commissioner shall certify to the
3.29commissioner of revenue each qualified volunteer's name and the qualified entity for which
3.30the qualified volunteer provided service, but the commissioner must remove duplicate
3.31listings of qualified volunteers who provided service to more than one qualified entity so
3.32that each qualified volunteer is listed only once. The commissioner shall also certify to the
3.33commissioner of revenue the total amount of aid to be paid to each qualified entity under
3.34subdivision 3. For qualified entities that are not municipalities, the commissioner must
3.35indicate the municipality to which the aid is to be paid, as designated by the qualified entity.
4.1    Subd. 3. Aid payment and calculation. The commissioner of revenue shall pay aid
4.2to qualified entities located in the pilot area to provide funds for the qualified entities to
4.3pay annual volunteer retention stipends to qualified volunteers who provide services to
4.4the qualified entities. A qualified entity is located in the pilot area if it is a municipality
4.5located in whole or in part in the pilot area, or if it is an emergency medical services
4.6provider or independent nonprofit firefighting corporation with its main office located in
4.7the pilot area. The amount of the aid equals $500 multiplied by the number of qualified
4.8volunteers. For purposes of calculating this aid, each individual providing volunteer
4.9service, regardless of the different types of service provided, is one qualified volunteer.
4.10The commissioner of revenue shall pay the aid to qualified entities by July 15 of the
4.11calendar year following the year in which the qualified volunteer provided service. If a
4.12qualified entity is not a municipality, the commissioner shall pay the aid to the treasurer of
4.13the municipality designated by the qualified entity. The treasurer of the municipality shall,
4.14within 30 days of receipt of the aid, transmit the aid to the qualified entity.
4.15    Subd. 4. Application. Each year each qualified entity in the pilot area may apply to
4.16the commissioner for aid under this section. The application must be made at the time and
4.17in the form prescribed by the commissioner and must provide sufficient information to
4.18permit the commissioner to determine the applicant's entitlement to aid under this section.
4.19    Subd. 5. Payment of stipends. A qualified entity receiving state aid under this
4.20section must pay the aid as retention stipends of $500 to qualified volunteers no later than
4.21September 15 of the year in which the aid was received.
4.22    Subd. 6. Report. No later than January 15, 2018, the commissioner must report to
4.23the chairs and ranking minority members of the legislative committees having jurisdiction
4.24over public safety and taxes in the senate and the house of representatives, in compliance
4.25with sections 3.195 and 3.197, on aid paid under this section. The report must include:
4.26(1) for each county in the pilot area, a listing of the qualified entities that received
4.27aid in each of the three years of the pilot;
4.28(2) the amount of aid paid to each qualified entity that received aid in each of the
4.29three years of the pilot; and
4.30(3) for each qualified entity that received aid, the number of qualified volunteers
4.31who were paid stipends in each of the three years of the pilot, and the number of qualified
4.32volunteers in the year preceding the pilot.
4.33The report must also provide information on the number of qualified volunteers
4.34providing service to qualified entities in comparison counties in each of the three years of
4.35the pilot and in the year preceding the pilot, and must summarize changes in the number
4.36of qualified volunteers during the year preceding the pilot and during the three years of
5.1the pilot both within the pilot area and in the comparison counties. For purposes of this
5.2subdivision, "comparison counties" means counties designated by the commissioner to
5.3include at least half of the counties that border each group of counties in the pilot area,
5.4as specified in subdivision 1. Qualified entities in comparison counties must provide
5.5information to the commissioner necessary to the report in this subdivision in the form
5.6and manner required by the commissioner.
5.7    Subd. 7. Appropriation. An amount sufficient to pay the state aid under this section
5.8is appropriated from the general fund to the commissioner of revenue.
5.9    Subd. 8. Sunset. This section expires for aid payable after calendar year 2017,
5.10except that the reporting requirement in subdivision 6 remains in effect through 2018.
5.11EFFECTIVE DATE.This section is effective the day following final enactment
5.12and applies for volunteer service provided beginning in calendar years 2014, 2015, and
5.132016, and for aid payable in calendar years 2015, 2016, and 2017.

5.14    Sec. 2. Minnesota Statutes 2012, section 273.1384, subdivision 2, is amended to read:
5.15    Subd. 2. Agricultural homestead market value credit. Property classified as
5.16agricultural homestead under section 273.13, subdivision 23, paragraph (a), is eligible for
5.17an agricultural credit. The credit is computed using the property's agricultural credit market
5.18value, defined for this purpose as the property's market value excluding the market value of
5.19the house, garage, and immediately surrounding one acre of land. The credit is equal to 0.3
5.20percent of the first $115,000 of the property's agricultural credit market value minus .05 plus
5.210.1 percent of the property's agricultural credit market value in excess of $115,000, subject
5.22to a maximum reduction credit of $115 $490. In the case of property that is classified
5.23as part homestead and part nonhomestead solely because not all the owners occupy or
5.24farm the property, not all the owners have qualifying relatives occupying or farming the
5.25property, or solely because not all the spouses of owners occupy the property, the credit
5.26must be initially computed as if that nonhomestead agricultural land was also classified as
5.27agricultural homestead and then prorated to the owner-occupant's percentage of ownership.
5.28EFFECTIVE DATE.This section is effective beginning with taxes payable in 2015.

5.29    Sec. 3. Minnesota Statutes 2013 Supplement, section 273.1398, subdivision 4, is
5.30amended to read:
5.31    Subd. 4. Disparity reduction credit. (a) Beginning with taxes payable in 1989,
5.32 Class 4a and class 3a property qualifies for a disparity reduction credit if: (1) the property
5.33is located in a border city that has is eligible to have an enterprise zone, as defined in
6.1section 469.166; (2) the property is located in a city with a population greater than 2,500
6.2and less than 35,000 according to the 1980 decennial census; (3) the city is adjacent to a
6.3city in another state or immediately adjacent to a city adjacent to a city in another state;
6.4and (4) the adjacent city in the other state has a population of greater than 5,000 and less
6.5than 75,000 according to the 1980 decennial census.
6.6    (b) The credit is an amount sufficient to reduce (i) the taxes levied on class 4a
6.7property to 1.9 1.6 percent of the property's taxable market value and (ii) the tax on class
6.83a property to 1.9 1.6 percent of taxable market value.
6.9    (c) The county auditor shall annually certify the costs of the credits to the
6.10Department of Revenue. The department shall reimburse local governments for the
6.11property taxes forgone as the result of the credits in proportion to their total levies.
6.12EFFECTIVE DATE.This section is effective beginning with taxes payable in 2015.

6.13    Sec. 4. Minnesota Statutes 2013 Supplement, section 423A.022, subdivision 2, is
6.14amended to read:
6.15    Subd. 2. Allocation. (a) Of the total amount appropriated as supplemental state aid:
6.16    (1) 58.065 58.064 percent must be paid to the executive director of the Public
6.17Employees Retirement Association for deposit in the public employees police and fire
6.18retirement fund established by section 353.65, subdivision 1;
6.19    (2) 35.484 percent must be paid to municipalities other than municipalities solely
6.20employing firefighters with retirement coverage provided by the public employees police
6.21and fire retirement plan which qualified to receive fire state aid in that calendar year,
6.22allocated in proportion to the most recent amount of fire state aid paid under section
6.2369.021, subdivision 7 , for the municipality bears to the most recent total fire state aid
6.24for all municipalities other than the municipalities solely employing firefighters with
6.25retirement coverage provided by the public employees police and fire retirement plan
6.26paid under section 69.021, subdivision 7, with the allocated amount for fire departments
6.27participating in the voluntary statewide lump-sum volunteer firefighter retirement plan
6.28paid to the executive director of the Public Employees Retirement Association for deposit
6.29in the fund established by section 353G.02, subdivision 3, and credited to the respective
6.30account and with the balance paid to the treasurer of each municipality for transmittal
6.31within 30 days of receipt to the treasurer of the applicable volunteer firefighter relief
6.32association for deposit in its special fund; and
6.33    (3) 6.452 percent must be paid to the executive director of the Minnesota State
6.34Retirement System for deposit in the state patrol retirement fund.
7.1(b) For purposes of this section, the term "municipalities" includes independent
7.2nonprofit firefighting corporations that participate in the voluntary statewide lump-sum
7.3volunteer firefighter retirement plan under chapter 353G or with subsidiary volunteer
7.4firefighter relief associations operating under chapter 424A.

7.5    Sec. 5. Minnesota Statutes 2013 Supplement, section 477A.013, subdivision 8, is
7.6amended to read:
7.7    Subd. 8. City formula aid. (a) For aids payable in 2014 only, the formula aid for a
7.8city is equal to the sum of (1) its 2013 certified aid, and (2) the product of (i) the difference
7.9between its unmet need and its 2013 certified aid, and (ii) the aid gap percentage.
7.10    (b) For aids payable in 2015 and thereafter, the formula aid for a city is equal to the
7.11sum of (1) its formula aid in the previous year and (2) the product of (i) the difference
7.12between its unmet need and its certified formula aid in the previous year under subdivision
7.139, and (ii) the aid gap percentage.
7.14    (c) For aids payable in 2015 and thereafter, if a city's certified aid from the previous
7.15year is greater than the sum of its unmet need plus its aid adjustment under subdivision 13,
7.16its formula aid is adjusted to equal its unmet need.
7.17    (d) No city may have a formula aid amount less than zero. The aid gap percentage
7.18must be the same for all cities subject to paragraph (b).
7.19    (e) The applicable aid gap percentage must be calculated by the Department of
7.20Revenue so that the total of the aid under subdivision 9 equals the total amount available
7.21for aid under section 477A.03. Data used in calculating aids to cities under sections
7.22477A.011 to 477A.013 shall be the most recently available data as of January 1 in the
7.23year in which the aid is calculated.
7.24EFFECTIVE DATE.This section is effective for aids payable in calendar year
7.252015 and thereafter.

7.26    Sec. 6. Minnesota Statutes 2013 Supplement, section 477A.03, subdivision 2a, is
7.27amended to read:
7.28    Subd. 2a. Cities. For aids payable in 2014, the total aid paid under section
7.29477A.013, subdivision 9 , is $507,598,012. The total aid paid under section 477A.013,
7.30subdivision 9
, is $509,098,012 $516,898,012 for aids payable in 2015. For aids payable
7.31in 2016 and thereafter, the total aid paid under section 477A.013, subdivision 9, is
7.32$511,598,012 $519,398,012.
8.1EFFECTIVE DATE.This section is effective for aids payable in calendar year
8.22015 and thereafter.

8.3    Sec. 7. Minnesota Statutes 2013 Supplement, section 477A.12, subdivision 1, is
8.4amended to read:
8.5    Subdivision 1. Types of land; payments. The following amounts are annually
8.6appropriated to the commissioner of natural resources from the general fund for transfer
8.7to the commissioner of revenue. The commissioner of revenue shall pay the transferred
8.8funds to counties as required by sections 477A.11 to 477A.14. The amounts, based on the
8.9acreage as of July 1 of each year prior to the payment year, are:
8.10(1) $5.133 multiplied by the total number of acres of acquired natural resources land
8.11or, at the county's option three-fourths of one percent of the appraised value of all acquired
8.12natural resources land in the county, whichever is greater;
8.13(2) $5.133, multiplied by the total number of acres of transportation wetland or, at
8.14the county's option, three-fourths of one percent of the appraised value of all transportation
8.15wetland in the county, whichever is greater;
8.16(3) $5.133, multiplied by the total number of acres of wildlife management land, or,
8.17at the county's option, three-fourths of one percent of the appraised value of all wildlife
8.18management land in the county, whichever is greater;
8.19(4) 50 percent of the dollar amount as determined under clause (1), multiplied by
8.20the number of acres of military refuge land in the county;
8.21(5) $1.50, multiplied by the number of acres of county-administered other natural
8.22resources land in the county;
8.23(6) $5.133, multiplied by the total number of acres of land utilization project land
8.24in the county;
8.25(7) $1.50, multiplied by the number of acres of commissioner-administered other
8.26natural resources land in the county; and
8.27    (8) without regard to acreage, and notwithstanding the rules adopted under section
8.2884A.55, $300,000 for local assessments under section 84A.55, subdivision 9, that shall be
8.29divided and distributed to the counties containing state-owned lands within a conservation
8.30area in proportion to each county's percentage of the total annual ditch assessments.
8.31The commissioner of natural resources shall certify the number of acres and appraised
8.32values for wildlife management lands under clause (3) for calendar year 2013 to the
8.33commissioner of revenue by June 15, 2014. The commissioner of revenue shall make the
8.34payment for any positive difference in the 2013 payment under clause (3) by June 30, 2014.
9.1EFFECTIVE DATE.The amendments to clause (3) are effective retroactively
9.2for payments made in calendar year 2013 and later. The amendments to clause (8) are
9.3effective for assessments payable in calendar year 2014 and later.

9.4    Sec. 8. Minnesota Statutes 2013 Supplement, section 477A.12, subdivision 2, is
9.5amended to read:
9.6    Subd. 2. Procedure. (a) Each county auditor shall certify to the Department of
9.7Natural Resources during July of each year prior to the payment year the number of acres
9.8of county-administered other natural resources land within the county. The Department of
9.9Natural resources may, in addition to the certification of acreage, require descriptive lists
9.10of land so certified. The commissioner of natural resources shall determine and certify to
9.11the commissioner of revenue by March 1 of the payment year:
9.12(1) the number of acres and most recent appraised value of acquired natural
9.13resources land, wildlife management land, and military refuge land within each county;
9.14(2) the number of acres of commissioner-administered natural resources land within
9.15each county;
9.16(3) the number of acres of county-administered other natural resources land within
9.17each county, based on the reports filed by each county auditor with the commissioner
9.18of natural resources; and
9.19(4) the number of acres of land utilization project land within each county.
9.20(b) The commissioner of transportation shall determine and certify to the
9.21commissioner of revenue by March 1 of the payment year the number of acres of
9.22transportation wetland and the appraised value of the land, but only if it exceeds 500
9.23acres in a county.
9.24(c) Each auditor of a county that contains state-owned lands within a conservation
9.25area shall determine and certify to the commissioner of natural resources by May 31 of
9.26the payment year, the county's ditch assessments for state-owned lands subject to section
9.2784A.55, subdivision 9. A joint certification for two or more counties may be submitted to
9.28the commissioner of natural resources through the Consolidated Conservation Counties
9.29Joint Powers Board. The commissioner of natural resources shall certify the ditch
9.30assessments to the commissioner of revenue by June 15 of the payment year. The
9.31commissioner of natural resources shall certify the ditch assessments under this paragraph
9.32for payment year 2013 by June 15, 2014. The commissioner of revenue shall make the
9.33payment for 2013 by June 30, 2014.
9.34(d) The commissioner of revenue shall determine the distributions provided for in this
9.35section using: (1) the number of acres and appraised values certified by the commissioner
10.1of natural resources and the commissioner of transportation by March 1 of the payment
10.2year; and (2) ditch assessments under paragraph (c), by July 15 of the payment year.
10.3EFFECTIVE DATE.This section is effective for assessments payable in calendar
10.4year 2014 and later.

10.5    Sec. 9. Minnesota Statutes 2013 Supplement, section 477A.14, subdivision 1, is
10.6amended to read:
10.7    Subdivision 1. General distribution. Except as provided in subdivisions 2 and 3,
10.840 percent of the total payment to the county shall be deposited in the county general
10.9revenue fund to be used to provide property tax levy reduction. The remainder shall be
10.10distributed by the county in the following priority:
10.11(a) (1) 64.2 cents, for each acre of county-administered other natural resources land
10.12shall be deposited in a resource development fund to be created within the county treasury
10.13for use in resource development, forest management, game and fish habitat improvement,
10.14and recreational development and maintenance of county-administered other natural
10.15resources land. Any county receiving less than $5,000 annually for the resource
10.16development fund may elect to deposit that amount in the county general revenue fund;
10.17(b) from the funds remaining, (2) within 30 days of receipt of the payment to
10.18the county, the county treasurer shall pay each organized township ten percent of the
10.19amount received a township with land that qualifies for payment under section 477A.12,
10.20subdivision 1
, clauses (1), (2), and (5) to (7), ten percent of the payment the county
10.21received for such land within that township. Payments for natural resources lands not
10.22located in an organized township shall be deposited in the county general revenue fund.
10.23Payments to counties and townships pursuant to this paragraph shall be used to provide
10.24property tax levy reduction, except that of the payments for natural resources lands not
10.25located in an organized township, the county may allocate the amount determined to be
10.26necessary for maintenance of roads in unorganized townships. Provided that, if the total
10.27payment to the county pursuant to section 477A.12 is not sufficient to fully fund the
10.28distribution provided for in this clause, the amount available shall be distributed to each
10.29township and the county general revenue fund on a pro rata basis; and
10.30(c) (3) any remaining funds shall be deposited in the county general revenue fund.
10.31Provided that, if the distribution to the county general revenue fund exceeds $35,000, the
10.32excess shall be used to provide property tax levy reduction.
10.33EFFECTIVE DATE.This section is effective retroactively for payments made in
10.34calendar year 2013 and thereafter.

11.1    Sec. 10. [477A.18] PRODUCTION PROPERTY TRANSITION AID.
11.2    Subdivision 1. Definitions. (a) When used in this section, the following terms have
11.3the meanings indicated in this subdivision.
11.4(b) "Local unit" means a home rule charter or statutory city, or a town.
11.5(c) "Net tax capacity differential" means the positive difference, if any, by which the
11.6local unit's net tax capacity was reduced from assessment year 2014 to assessment year
11.72015 due to the change in the definition of real property in section 272.03, subdivision
11.81, enacted by article 2, section 9. For purposes of determining the net tax capacity
11.9differential, any property in a job opportunity building zone under section 469.314 may
11.10not be included when calculating a local unit's net tax capacity.
11.11    Subd. 2. Aid eligibility; payment. (a) If the net tax capacity differential of the local
11.12unit exceeds five percent of its 2015 net tax capacity, the local unit is eligible for transition
11.13aid computed under paragraphs (b) to (f).
11.14(b) For aids payable in 2016, transition aid under this section for an eligible local
11.15unit equals (1) the net tax capacity differential, times (2) the jurisdiction's tax rate for
11.16taxes payable in 2015.
11.17(c) For aids payable in 2017, transition aid under this section for an eligible local
11.18unit equals 80 percent of (1) the net tax capacity differential, times (2) the jurisdiction's
11.19tax rate for taxes payable in 2016.
11.20(d) For aids payable in 2018, transition aid under this section for an eligible local
11.21unit equals 60 percent of (1) the net tax capacity differential, times (2) the jurisdiction's
11.22tax rate for taxes payable in 2017.
11.23(e) For aids payable in 2019, transition aid under this section for an eligible local
11.24unit equals 40 percent of (1) the net tax capacity differential, times (2) the jurisdiction's
11.25tax rate for taxes payable in 2018.
11.26(f) For aids payable in 2020, transition aid under this section for an eligible local
11.27unit equals 20 percent of (1) the net tax capacity differential, times (2) the jurisdiction's
11.28tax rate for taxes payable in 2019.
11.29(g) No aids shall be payable under this section in 2021 and thereafter.
11.30(h) The commissioner of revenue shall compute the amount of transition aid payable
11.31to each local unit under this section. On or before August 1 of each year, the commissioner
11.32shall certify the amount of transition aid computed for aids payable in the following year
11.33for each recipient local unit. The commissioner shall pay transition aid to local units
11.34annually at the times provided in section 477A.015.
11.35(i) The commissioner of revenue may require counties to provide any data that the
11.36commissioner deems necessary to administer this section.
12.1    Subd. 3. Appropriation. An amount sufficient to pay transition aid under this
12.2section is annually appropriated to the commissioner of revenue from the general fund.
12.3EFFECTIVE DATE.This section is effective beginning with assessment year 2015.

12.4    Sec. 11. [477A.19] AQUATIC INVASIVE SPECIES PREVENTION AID.
12.5    Subdivision 1. Definitions. (a) When used in this section, the following terms have
12.6the meanings given them in this subdivision.
12.7(b) "Aquatic invasive species" means nonnative aquatic organisms that invade water
12.8beyond their natural and historic range.
12.9(c) "Watercraft trailer launch" means any public water access site designed for
12.10launching watercraft.
12.11(d) "Watercraft trailer parking space" means a parking space designated for a boat
12.12trailer at any public water access site designed for launching watercraft.
12.13    Subd. 2. Distribution. The money appropriated to aquatic invasive species
12.14prevention aid under this section shall be allocated to all counties in the state as follows:
12.1550 percent based on each county's share of watercraft trailer launches and 50 percent based
12.16on each county's share of watercraft trailer parking spaces.
12.17    Subd. 3. Use of proceeds. A county that receives a distribution under this section
12.18must use the proceeds solely to prevent the introduction or limit the spread of aquatic
12.19invasive species at all access sites within the county. The county must establish, by
12.20resolution or through adoption of a plan, guidelines for the use of the proceeds. The
12.21guidelines set by the county board may include, but are not limited to, providing for
12.22site-level management, countywide awareness, and other procedures that the county finds
12.23necessary to achieve compliance. The county may appropriate the proceeds directly,
12.24or may use any portion of the proceeds to provide funding for a joint powers board or
12.25cooperative agreement with another political subdivision, a soil and water conservation
12.26district in the county, a watershed district in the county, or a lake association located
12.27in the county. Any money appropriated by the county to a different entity or political
12.28subdivision must be used as required under this section. Each county must submit a
12.29copy of its guidelines for use of the proceeds to the Department of Natural Resources by
12.30December 31 of the year the payments are received.
12.31    Subd. 4. Payments. The commissioner of revenue must compute the amount of
12.32aquatic invasive species prevention aid payable to each county under this section. On or
12.33before August 1 of each year, the commissioner shall certify the amount to be paid to
12.34each county in the following year. The commissioner shall pay aquatic invasive species
12.35prevention aid to counties annually at the times provided in section 477A.015. For aid
13.1payable in 2014 only, the commissioner shall certify the amount to be paid to each county
13.2by July 1, 2014, and payment to the counties must be made at the time provided in section
13.3477A.015 for the first installment of local government aid.
13.4    Subd. 5. Appropriation. $4,500,000 in 2014, and $10,000,000 each year thereafter,
13.5is appropriated from the general fund to the commissioner of revenue to make the
13.6payments required under this section.
13.7EFFECTIVE DATE.This section is effective beginning with aid payable in 2014.

13.8    Sec. 12. ADDITIONAL SUPPLEMENTAL AID REVISION FOR OMITTED
13.92013 INDEPENDENT NONPROFIT FIREFIGHTING CORPORATIONS.
13.10(a) Notwithstanding any provision of Minnesota Statutes, chapter 423A, to the
13.11contrary, this section modifies the allocation of the police and fire supplemental retirement
13.12state aid under Minnesota Statutes 2013 Supplement, section 423A.022, for October
13.131, 2014.
13.14(b) Before the allocation of the police and fire supplemental retirement state aid is
13.15made for October 1, 2014, the commissioner of revenue shall:
13.16(1) determine those fire departments that qualified for fire state aid under Minnesota
13.17Statutes 2012, section 69.021, subdivision 7, on October 1, 2013, did not receive a 2013
13.18allocation of police and fire supplemental retirement state aid, and were an independent
13.19nonprofit firefighting corporation; and
13.20(2) determine the amount of police and fire supplemental retirement state aid
13.21under Minnesota Statutes 2013 Supplement, section 423A.022, that the fire departments
13.22described in clause (1) would have received on October 1, 2013, if the fire departments
13.23had been included in that allocation.
13.24(c) The total amount determined in paragraph (b), clause (2), must be deducted from
13.25the amount available for allocation under Minnesota Statutes 2013 Supplement, section
13.26423A.022, subdivision 2, clause (2), and the commissioner of revenue shall pay to the fire
13.27departments determined in paragraph (b), clause (1), their respective portion of the total as
13.28an additional payment on October 1, 2014.
13.29(d) The remaining amount after the deduction of the total amount under paragraph
13.30(c) must be allocated as provided in section 4.

13.31    Sec. 13. SUPPLEMENTAL COUNTY PROGRAM AID FOR 2014.
13.32(a) Each county whose certified aid for 2014 under Minnesota Statutes, section
13.33477A.0124, is less than the aid it received under that section in 2013 shall be eligible for
14.1supplemental aid in 2014 equal to the difference between the amount received in 2013
14.2and the amount certified for 2014.
14.3(b) The aid under this section shall be paid in the same manner and at the same time
14.4as the regular aid payments under Minnesota Statutes, section 477A.0124.
14.5(c) The amount necessary to pay supplemental aid under this section is appropriated
14.6from the general fund to the commissioner of revenue.
14.7EFFECTIVE DATE.This section is effective July 1, 2014.

14.8    Sec. 14. SUPPLEMENTAL AGRICULTURAL CREDIT FOR TAXES PAYABLE
14.9IN 2014 ONLY.
14.10    Subdivision 1. Eligibility. Each agricultural homestead qualifying for a credit
14.11for taxes payable in 2014 under Minnesota Statutes, section 273.1384, is eligible for a
14.12supplemental credit equal to the lesser of (i) $205, or (ii) the net property taxes payable on
14.13the property, excluding the taxes attributable to the house, garage, and surrounding one acre
14.14of land. A supplemental credit must not be paid to any property that has delinquent property
14.15taxes. By August 15, 2014, the county auditor must notify the commissioner of revenue of
14.16the name and address of the property owner of each homestead that received an agricultural
14.17credit for taxes payable in 2014, along with the net taxes due upon the agricultural
14.18homestead, whether there are any delinquent taxes on the property, and whatever other
14.19information the commissioner deems necessary, in a form prescribed by the commissioner.
14.20    Subd. 2. Payment of supplemental credit. The commissioner must pay
14.21supplemental credit amounts to each qualifying taxpayer by October 15, 2014.
14.22    Subd. 3. Property tax statements for taxes payable in 2015. In preparing
14.23proposed property tax notices for taxes payable in 2015 under Minnesota Statutes, section
14.24275.065, and final property tax statements for taxes payable in 2015 under Minnesota
14.25Statutes, section 276.04, the auditor must indicate that the taxpayer may have received a
14.26supplemental credit under this section for taxes payable in 2014.
14.27    Subd. 4. Appropriation. The amount necessary to make the payments required
14.28under subdivision 2 is appropriated from the general fund to the commissioner of revenue
14.29for fiscal year 2015.
14.30EFFECTIVE DATE.This section is effective the day following final enactment.

14.31    Sec. 15. 2013 CITY AID PENALTY FORGIVENESS; CITY OF BLUFFTON.
14.32Notwithstanding Minnesota Statutes, section 477A.017, subdivision 3, the city of
14.33Bluffton shall receive the half of its aid payments for calendar years 2011, 2012, and
15.12013 under Minnesota Statutes, section 477A.013, that were withheld under Minnesota
15.2Statutes, section 477A.017, subdivision 3, provided that the state auditor certifies to the
15.3commissioner of revenue that it received audited financial statements from the city for
15.4calendar years 2010, 2011, and 2012 by December 31, 2013, and for calendar year 2013
15.5by June 30, 2014. The commissioner of revenue shall make a payment of $20,000 with
15.6the first payment of aids under Minnesota Statutes, section 477A.015, in calendar year
15.72014. The commissioner shall pay the remaining amount, totaling $28,151.50, with the
15.8first payment of aids under Minnesota Statutes, section 477A.015, in calendar year 2015.
15.9$20,000 in fiscal year 2015 and $28,151.50 in fiscal year 2016 are appropriated from the
15.10general fund to the commissioner of revenue to make payments under this section.
15.11EFFECTIVE DATE.This section is effective the day following final enactment.

15.12    Sec. 16. HOMESTEAD CREDIT REFUND AND RENTER PROPERTY TAX
15.13REFUND INCREASE.
15.14    Subdivision 1. Homestead credit refund increase. For claims filed based on taxes
15.15payable in 2014, the commissioner shall increase by three percent the refund otherwise
15.16payable under Minnesota Statutes, section 290A.04, subdivision 2.
15.17    Subd. 2. Renter property tax refund increase. For claims filed based on rent paid
15.18in 2013, the commissioner shall increase by six percent the refund otherwise payable
15.19under Minnesota Statutes, section 290A.04, subdivision 2a.
15.20    Subd. 3. No notification of appeal rights. In adjusting homestead credit refunds
15.21and renter property tax refunds under this section, the commissioner is not required to
15.22provide information concerning appeal rights that ordinarily must be provided whenever
15.23the commissioner adjusts refunds payable under Minnesota Statutes, chapter 290A.
15.24Taxpayers retain all rights to appeal adjustments under this section.
15.25    Subd. 4. Appropriation. The amount necessary to make the payments required
15.26under this section is appropriated from the general fund to the commissioner of revenue.
15.27EFFECTIVE DATE.This section is effective for refund claims based on taxes
15.28payable in 2014 and rent paid in 2013 only.

16.1ARTICLE 2
16.2PROPERTY TAXES

16.3    Section 1. Minnesota Statutes 2013 Supplement, section 144F.01, subdivision 4,
16.4is amended to read:
16.5    Subd. 4. Property tax levy authority. The district's board may levy a tax on the
16.6taxable real and personal property in the district. The ad valorem tax levy may not exceed
16.70.048 percent of the estimated market value of the district or $400,000 $550,000, whichever
16.8is less. The proceeds of the levy must be used as provided in subdivision 5. The board shall
16.9certify the levy at the times as provided under section 275.07. The board shall provide the
16.10county with whatever information is necessary to identify the property that is located within
16.11the district. If the boundaries include a part of a parcel, the entire parcel shall be included
16.12in the district. The county auditors must spread, collect, and distribute the proceeds of the
16.13tax at the same time and in the same manner as provided by law for all other property taxes.
16.14EFFECTIVE DATE.This section is effective for assessments in 2015, taxes
16.15payable in 2016, and thereafter.

16.16    Sec. 2. Minnesota Statutes 2012, section 272.02, subdivision 10, is amended to read:
16.17    Subd. 10. Personal property used for pollution control. Personal property used
16.18primarily for the abatement and control of air, water, or land pollution is exempt to the
16.19extent that it is so used, and real property is exempt if it is used primarily for abatement
16.20and control of air, water, or land pollution as part of an agricultural operation, as a part
16.21of a centralized treatment and recovery facility operating under a permit issued by the
16.22Minnesota Pollution Control Agency pursuant to chapters 115 and 116 and Minnesota
16.23Rules, parts 7001.0500 to 7001.0730, and 7045.0020 to 7045.1260, as a wastewater
16.24treatment facility and for the treatment, recovery, and stabilization of metals, oils,
16.25chemicals, water, sludges, or inorganic materials from hazardous industrial wastes, or as
16.26part of an electric generation system. For purposes of this subdivision, personal property
16.27includes ponderous machinery and equipment used in a business or production activity
16.28that at common law is considered real property.
16.29Any taxpayer requesting exemption of all or a portion of any real property or any
16.30equipment or device, or part thereof, operated primarily for the control or abatement of
16.31air, water, or land pollution shall file an application with the commissioner of revenue.
16.32The commissioner shall develop an electronic means to notify interested parties when
16.33electric power generation facilities have filed an application. The Minnesota Pollution
17.1Control Agency shall upon request of the commissioner furnish information and advice to
17.2the commissioner.
17.3The information and advice furnished by the Minnesota Pollution Control
17.4Agency must include statements as to whether the equipment, device, or real property
17.5meets a standard, rule, criteria, guideline, policy, or order of the Minnesota Pollution
17.6Control Agency, and whether the equipment, device, or real property is installed or
17.7operated in accordance with it. On determining that property qualifies for exemption,
17.8the commissioner shall issue an order exempting the property from taxation. The
17.9commissioner shall develop an electronic means to notify interested parties when
17.10the commissioner has issued an order exempting property from taxation under this
17.11subdivision. The equipment, device, or real property shall continue to be exempt from
17.12taxation as long as the order issued by the commissioner remains in effect.
17.13EFFECTIVE DATE.This section is effective the day following final enactment.

17.14    Sec. 3. Minnesota Statutes 2012, section 272.02, subdivision 24, is amended to read:
17.15    Subd. 24. Electric power photovoltaic devices Solar energy generating systems.
17.16Photovoltaic devices Personal property consisting of solar energy generating systems, as
17.17defined in section 216C.06, subdivision 16, installed after January 1, 1992, and used to
17.18produce or store electric power are 272.0295, is exempt. If the real property upon which a
17.19solar energy generating system is located is used primarily for solar energy production
17.20subject to the production tax under section 272.0295, the real property shall be classified
17.21as class 3a. If the real property upon which a solar energy generating system is located is
17.22not used primarily for solar energy production subject to the production tax under section
17.23272.0295, the real property shall be classified without regard to the system.
17.24EFFECTIVE DATE.This section is effective for assessments in 2015, taxes
17.25payable in 2016, and thereafter.

17.26    Sec. 4. Minnesota Statutes 2012, section 272.02, subdivision 93, is amended to read:
17.27    Subd. 93. Electric generation facility; personal property. Notwithstanding
17.28subdivision 9, clause (a), attached machinery and other personal property that is part of
17.29a simple-cycle electric generation facility of more than 40 megawatts and less than 125
17.30megawatts of installed capacity and that meets the requirements of this subdivision is
17.31exempt. At the time of construction, the facility must:
17.32(1) utilize natural gas as a primary fuel;
18.1(2) be located within two miles of parallel existing 36-inch natural gas pipelines and
18.2an existing 115-kilovolt high-voltage electric transmission line;
18.3(3) be designed to provide peaking, emergency backup, or contingency services;
18.4(4) satisfy a resource deficiency identified in an approved integrated resource plan
18.5filed under section 216B.2422; and
18.6(5) have an agreement with the host county, township, and school district for
18.7payment in lieu of personal property taxes to the host county, township, and school district
18.8for the operating life of the facility. Any amount distributed to the school district is not
18.9subject to the deductions under section 126C.21.
18.10Construction of the facility must be commenced after January 1, 2010 2015, and
18.11before January 1, 2014 2019. Property eligible for this exemption does not include electric
18.12transmission lines and interconnections or gas pipelines and interconnections appurtenant
18.13to the property or the facility.
18.14EFFECTIVE DATE.This section is effective for assessments in 2015, taxes
18.15payable in 2016, and thereafter.

18.16    Sec. 5. Minnesota Statutes 2012, section 272.0211, subdivision 1, is amended to read:
18.17    Subdivision 1. Efficiency determination and certification. An owner or operator
18.18of a new or existing electric power generation facility, excluding wind energy conversion
18.19systems, may apply to the commissioner of revenue for a market value exclusion on the
18.20property as provided for in this section. This exclusion shall apply only to the market
18.21value of the equipment of the facility, and shall not apply to the structures and the land
18.22upon which the facility is located. The commissioner of revenue shall prescribe the forms
18.23and procedures for this application. Upon receiving the application, the commissioner
18.24of revenue shall: (1) request the commissioner of commerce to make a determination of
18.25the efficiency of the applicant's electric power generation facility; and (2) shall develop
18.26an electronic means to notify interested parties when electric power generation facilities
18.27have filed an application. The commissioner of commerce shall calculate efficiency as
18.28the ratio of useful energy outputs to energy inputs, expressed as a percentage, based
18.29on the performance of the facility's equipment during normal full load operation. The
18.30commissioner must include in this formula the energy used in any on-site preparation of
18.31materials necessary to convert the materials into the fuel used to generate electricity, such as
18.32a process to gasify petroleum coke. The commissioner shall use the Higher Heating Value
18.33(HHV) for all substances in the commissioner's efficiency calculations, except for wood
18.34for fuel in a biomass-eligible project under section 216B.2424; for these instances, the
18.35commissioner shall adjust the heating value to allow for energy consumed for evaporation
19.1of the moisture in the wood. The applicant shall provide the commissioner of commerce
19.2with whatever information the commissioner deems necessary to make the determination.
19.3Within 30 days of the receipt of the necessary information, the commissioner of commerce
19.4shall certify the findings of the efficiency determination to the commissioner of revenue
19.5and to the applicant. The commissioner of commerce shall determine the efficiency of the
19.6facility and certify the findings of that determination to the commissioner of revenue every
19.7two years thereafter from the date of the original certification.
19.8EFFECTIVE DATE.This section is effective the day following final enactment.

19.9    Sec. 6. Minnesota Statutes 2012, section 272.0211, subdivision 2, is amended to read:
19.10    Subd. 2. Sliding scale exclusion. Based upon the efficiency determination provided
19.11by the commissioner of commerce as described in subdivision 1, the commissioner of
19.12revenue shall subtract eight percent of the taxable market value of the qualifying property
19.13for each percentage point that the efficiency of the specific facility, as determined by the
19.14commissioner of commerce, is above 40 percent. The reduction in taxable market value
19.15shall be reflected in the taxable market value of the facility beginning with the assessment
19.16year immediately following the determination. The commissioner shall develop an
19.17electronic means to notify interested parties of the qualifying facilities and their respective
19.18exclusion percentages after the efficiency determination is made by the Department of
19.19Commerce. For a facility that is assessed by the county in which the facility is located,
19.20the commissioner of revenue shall certify to the assessor of that county the percentage
19.21of the taxable market value of the facility to be excluded.
19.22EFFECTIVE DATE.This section is effective the day following final enactment.

19.23    Sec. 7. Minnesota Statutes 2012, section 272.0211, subdivision 4, is amended to read:
19.24    Subd. 4. Eligibility. An owner or operator of a new or existing electric power
19.25generation facility who offers electric power generated by the facility for sale is eligible
19.26for an exclusion under this section only if:
19.27(1) the owner or operator has received a certificate of need under section 216B.243,
19.28if required under that section;
19.29(2) the public utilities commission finds that an agreement exists or a good faith offer
19.30has been made to sell the majority of the net power generated by the facility to an electric
19.31utility which has a demonstrated need for the power. A right of first refusal satisfies the good
19.32faith offer requirement. The commission shall have 90 days from the date the commission
19.33receives notice of the application under subdivision 1 to make this determination; and
20.1(3) the electric utility has agreed in advance not to offer the electric power for resale
20.2to a retail customer located outside of the utility's assigned service area, or, if the utility is
20.3a generation and transmission cooperative electric association, the assigned service area
20.4of its members, unless otherwise permitted by law; and
20.5(4) for any facility that was not certified as eligible for an exclusion under
20.6subdivision 2 for property taxes payable in 2015, the facility must be converted from
20.7coal to an alternative fuel and must have a nameplate capacity prior to conversion of
20.8less than 75 megawatts.
20.9For the purposes of this subdivision, "electric utility" means an entity whose primary
20.10business function is to operate, maintain, or control equipment or facilities for providing
20.11electric service at retail or wholesale, and includes distribution cooperative electric
20.12associations, generation and transmission cooperative electric associations, municipal
20.13utilities, and public utilities as defined in section 216B.02, subdivision 4.
20.14EFFECTIVE DATE.This is section is effective for assessment year 2015 and
20.15thereafter.

20.16    Sec. 8. [272.0295] SOLAR ENERGY PRODUCTION TAX.
20.17    Subdivision 1. Production tax. A tax is imposed on the production of electricity
20.18from a solar energy generating system used as an electric power source.
20.19    Subd. 2. Definitions. (a) For the purposes of this section, the term "solar energy
20.20generating system" means a set of devices whose primary purpose is to produce electricity
20.21by means of any combination of collecting, transferring, or converting solar generated
20.22energy.
20.23(b) The total size of a solar energy generating system under this subdivision shall
20.24be determined according to this paragraph. Unless the systems are interconnected with
20.25different distribution systems, the nameplate capacity of a solar energy generating system
20.26shall be combined with the nameplate capacity of any other solar energy generating
20.27system that is:
20.28(1) constructed within the same 12-month period as the solar energy generating
20.29system; and
20.30(2) exhibits characteristics of being a single development, including but not
20.31limited to ownership structure, an umbrella sales arrangement, shared interconnection,
20.32revenue-sharing arrangements, and common debt or equity financing.
20.33In the case of a dispute, the commissioner of commerce shall determine the total size of
20.34the system and shall draw all reasonable inferences in favor of combining the systems.
21.1(c) In making a determination under paragraph (b), the commissioner of commerce
21.2may determine that two solar energy generating systems are under common ownership
21.3when the underlying ownership structure contains similar persons or entities, even if the
21.4ownership shares differ between the two systems. Solar energy generating systems are
21.5not under common ownership solely because the same person or entity provided equity
21.6financing for the systems.
21.7    Subd. 3. Rate of tax. (a) For a solar energy generating system with a capacity
21.8exceeding one megawatt alternating current, the tax is $1.20 per megawatt-hour.
21.9(b) A solar energy generating system with a capacity of one megawatt alternating
21.10current or less is exempt from the tax imposed under this section.
21.11    Subd. 4. Reports. An owner of a solar energy generating system subject to tax
21.12under this section shall file a report with the commissioner of revenue annually on or
21.13before January 15 detailing the amount of electricity in megawatt-hours that was produced
21.14by the system in the previous calendar year. The commissioner shall prescribe the form
21.15of the report. The report must contain the information required by the commissioner to
21.16determine the tax due to each county under this section for the current year. If an owner
21.17of a solar energy generating system subject to taxation under this section fails to file the
21.18report by the due date, the commissioner of revenue shall determine the tax based upon
21.19the nameplate capacity of the system multiplied by a capacity factor of 30 percent.
21.20    Subd. 5. Notification of tax. (a) On or before February 28, the commissioner of
21.21revenue shall notify the owner of each solar energy generating system of the tax due to
21.22each county for the current year and shall certify to the county auditor of each county in
21.23which the system is located the tax due from each owner for the current year.
21.24(b) If the commissioner of revenue determines that the amount of production tax has
21.25been erroneously calculated, the commissioner may correct the error. The commissioner
21.26must notify the owner of the solar energy generating system of the correction and the
21.27amount of tax due to each county and must certify the correction to the county auditor of
21.28each county in which the system is located on or before April 1 of the current year.
21.29    Subd. 6. Payment of tax; collection. The amount of production tax determined
21.30under subdivision 5 must be paid to the county treasurer at the time and in the manner
21.31provided for payment of property taxes under section 277.01, subdivision 3, and, if unpaid,
21.32is subject to the same enforcement, collection, and interest and penalties as delinquent
21.33personal property taxes. Except to the extent inconsistent with this section, the provisions
21.34of sections 277.01 to 277.24 and 278.01 to 278.14 apply to the taxes imposed under this
21.35section, and for purposes of those provisions, the taxes imposed under this section are
21.36considered personal property taxes.
22.1    Subd. 7. Distribution of revenues. Revenues from the taxes imposed under this
22.2section must be part of the settlement between the county treasurer and the county auditor
22.3under section 276.09. The revenue must be distributed by the county auditor or the county
22.4treasurer to local taxing jurisdictions in which the solar energy generating system is
22.5located as follows: 80 percent to counties; and 20 percent to cities and townships.
22.6EFFECTIVE DATE.This section is effective beginning with taxes payable in 2015.

22.7    Sec. 9. Minnesota Statutes 2012, section 272.03, subdivision 1, is amended to read:
22.8    Subdivision 1. Real property. (a) For the purposes of taxation, "real property"
22.9includes the land itself, rails, ties, and other track materials annexed to the land, and all
22.10buildings, structures, and improvements or other fixtures on it, bridges of bridge companies,
22.11and all rights and privileges belonging or appertaining to the land, and all mines, iron ore
22.12and taconite minerals not otherwise exempt, quarries, fossils, and trees on or under it.
22.13(b) A building or structure shall include the building or structure itself, together with
22.14all improvements or fixtures annexed to the building or structure, which are integrated
22.15with and of permanent benefit to the building or structure, regardless of the present use
22.16of the building, and which cannot be removed without substantial damage to itself or to
22.17the building or structure.
22.18(c)(i) Real property does not include tools, implements, machinery, and equipment
22.19attached to or installed in real property for use in the business or production activity
22.20conducted thereon, regardless of size, weight or method of attachment, and mine shafts,
22.21tunnels, and other underground openings used to extract ores and minerals taxed under
22.22chapter 298 together with steel, concrete, and other materials used to support such openings.
22.23(ii) The exclusion provided in clause (i) shall not apply to machinery and equipment
22.24includable as real estate by paragraphs (a) and (b) even though such machinery and
22.25equipment is used in the business or production activity conducted on the real property if
22.26and to the extent such business or production activity consists of furnishing services or
22.27products to other buildings or structures which are subject to taxation under this chapter.
22.28(iii) The exclusion provided in clause (i) does not apply to the exterior shell of a
22.29structure which constitutes walls, ceilings, roofs, or floors if the shell of the structure has
22.30structural, insulation, or temperature control functions or provides protection from the
22.31elements, unless the structure is primarily used in the production of biofuels, wine, beer,
22.32distilled beverages, or dairy products. Such an exterior shell is included in the definition
22.33of real property even if it also has special functions distinct from that of a building, or if
22.34such an exterior shell is primarily used for the storage of ingredients or materials used in
23.1the production of biofuels, wine, beer, distilled beverages, or dairy products, or for the
23.2storage of finished biofuels, wine, beer, distilled beverages, or dairy products.
23.3(d) The term real property does not include tools, implements, machinery,
23.4equipment, poles, lines, cables, wires, conduit, and station connections which are part of a
23.5telephone communications system, regardless of attachment to or installation in real
23.6property and regardless of size, weight, or method of attachment or installation.
23.7EFFECTIVE DATE.This section is effective beginning with assessment year 2015.

23.8    Sec. 10. Minnesota Statutes 2012, section 273.13, subdivision 34, is amended to read:
23.9    Subd. 34. Homestead of disabled veteran or family caregiver. (a) All or a
23.10portion of the market value of property owned by a veteran and serving as the veteran's
23.11homestead under this section is excluded in determining the property's taxable market
23.12value if the veteran has a service-connected disability of 70 percent or more as certified
23.13by the United States Department of Veterans Affairs. To qualify for exclusion under this
23.14subdivision, the veteran must have been honorably discharged from the United States
23.15armed forces, as indicated by United States Government Form DD214 or other official
23.16military discharge papers.
23.17    (b)(1) For a disability rating of 70 percent or more, $150,000 of market value is
23.18excluded, except as provided in clause (2); and
23.19    (2) for a total (100 percent) and permanent disability, $300,000 of market value is
23.20excluded.
23.21    (c) If a disabled veteran qualifying for a valuation exclusion under paragraph (b),
23.22clause (2), predeceases the veteran's spouse, and if upon the death of the veteran the spouse
23.23holds the legal or beneficial title to the homestead and permanently resides there, the
23.24exclusion shall carry over to the benefit of the veteran's spouse for the current taxes payable
23.25year and for five eight additional taxes payable years or until such time as the spouse
23.26remarries, or sells, transfers, or otherwise disposes of the property, whichever comes first.
23.27Qualification under this paragraph requires an annual application under paragraph (h).
23.28(d) If the spouse of a member of any branch or unit of the United States armed
23.29forces who dies due to a service-connected cause while serving honorably in active
23.30service, as indicated on United States Government Form DD1300 or DD2064, holds the
23.31legal or beneficial title to a homestead and permanently resides there, the spouse is entitled
23.32to the benefit described in paragraph (b), clause (2), for five eight taxes payable years,
23.33or until such time as the spouse remarries or sells, transfers, or otherwise disposes of the
23.34property, whichever comes first.
24.1(e) If a veteran meets the disability criteria of paragraph (a) but does not own
24.2property classified as homestead in the state of Minnesota, then the homestead of the
24.3veteran's primary family caregiver, if any, is eligible for the exclusion that the veteran
24.4would otherwise qualify for under paragraph (b).
24.5    (f) In the case of an agricultural homestead, only the portion of the property
24.6consisting of the house and garage and immediately surrounding one acre of land qualifies
24.7for the valuation exclusion under this subdivision.
24.8    (g) A property qualifying for a valuation exclusion under this subdivision is not
24.9eligible for the market value exclusion under subdivision 35, or classification under
24.10subdivision 22, paragraph (b).
24.11    (h) To qualify for a valuation exclusion under this subdivision a property owner
24.12must apply to the assessor by July 1 of each assessment year, except that an annual
24.13reapplication is not required once a property has been accepted for a valuation exclusion
24.14under paragraph (a) and qualifies for the benefit described in paragraph (b), clause (2), and
24.15the property continues to qualify until there is a change in ownership. For an application
24.16received after July 1 of any calendar year, the exclusion shall become effective for the
24.17following assessment year.
24.18(i) A first-time application by a qualifying spouse for the market value exclusion under
24.19paragraph (d) must be made any time within two years of the death of the service member.
24.20(j) For purposes of this subdivision:
24.21(1) "active service" has the meaning given in section 190.05;
24.22(2) "own" means that the person's name is present as an owner on the property deed;
24.23(3) "primary family caregiver" means a person who is approved by the secretary of
24.24the United States Department of Veterans Affairs for assistance as the primary provider
24.25of personal care services for an eligible veteran under the Program of Comprehensive
24.26Assistance for Family Caregivers, codified as United States Code, title 38, section 1720G;
24.27and
24.28(4) "veteran" has the meaning given the term in section 197.447.
24.29(k) The purpose of this provision of law providing a level of homestead property tax
24.30relief for gravely disabled veterans, their primary family caregivers, and their surviving
24.31spouses is to help ease the burdens of war for those among our state's citizens who bear
24.32those burdens most heavily.
24.33EFFECTIVE DATE.This section is effective for taxes payable in 2015, and
24.34applies to homesteads that initially qualified for the exclusion for taxes payable in 2009
24.35and thereafter.

25.1    Sec. 11. Minnesota Statutes 2012, section 275.065, subdivision 1, is amended to read:
25.2    Subdivision 1. Proposed levy. (a) Notwithstanding any law or charter to the
25.3contrary, on or before September 15 30, each taxing authority, other than a school district,
25.4shall adopt a proposed budget and county and each home rule charter or statutory city shall
25.5certify to the county auditor the proposed or, in the case of a town, the final property tax
25.6levy for taxes payable in the following year.
25.7    (b) Notwithstanding any law or charter to the contrary, on or before September 15,
25.8each town and each special taxing district shall adopt and certify to the county auditor a
25.9proposed property tax levy for taxes payable in the following year. For towns, the final
25.10certified levy shall also be considered the proposed levy.
25.11    (c) On or before September 30, each school district that has not mutually agreed
25.12with its home county to extend this date shall certify to the county auditor the proposed
25.13property tax levy for taxes payable in the following year. Each school district that has
25.14agreed with its home county to delay the certification of its proposed property tax levy
25.15must certify its proposed property tax levy for the following year no later than October
25.167. The school district shall certify the proposed levy as:
25.17    (1) a specific dollar amount by school district fund, broken down between
25.18voter-approved and non-voter-approved levies and between referendum market value
25.19and tax capacity levies; or
25.20    (2) the maximum levy limitation certified by the commissioner of education
25.21according to section 126C.48, subdivision 1.
25.22    (c) (d) If the board of estimate and taxation or any similar board that establishes
25.23maximum tax levies for taxing jurisdictions within a first class city certifies the maximum
25.24property tax levies for funds under its jurisdiction by charter to the county auditor by
25.25September 15 the date specified in paragraph (a), the city shall be deemed to have certified
25.26its levies for those taxing jurisdictions.
25.27    (d) (e) For purposes of this section, "taxing authority" includes all home rule and
25.28statutory cities, towns, counties, school districts, and "special taxing district" means a
25.29 special taxing districts district as defined in section 275.066. Intermediate school districts
25.30that levy a tax under chapter 124 or 136D, joint powers boards established under sections
25.31123A.44 to 123A.446, and Common School Districts No. 323, Franconia, and No. 815,
25.32Prinsburg, are also special taxing districts for purposes of this section.
25.33(e) (f) At the meeting at which the a taxing authority, other than a town, adopts its
25.34proposed tax levy under paragraph (a) or (b) this subdivision, the taxing authority shall
25.35announce the time and place of its subsequent regularly scheduled meetings at which
25.36the budget and levy will be discussed and at which the public will be allowed to speak.
26.1The time and place of those meetings must be included in the proceedings or summary
26.2of proceedings published in the official newspaper of the taxing authority under section
26.3123B.09 , 375.12, or 412.191.
26.4EFFECTIVE DATE.This section is effective beginning with taxes payable in 2015.

26.5    Sec. 12. Minnesota Statutes 2012, section 279.03, subdivision 2, is amended to read:
26.6    Subd. 2. Composite judgment. Amounts included in composite judgments
26.7authorized by section 279.37, subdivision 1, and confessed on or after July 1, 1982, are
26.8subject to interest at the rate determined pursuant to section 549.09. Amounts confessed
26.9under this authority after December 31, 1990, (a) Except as provided in paragraph (b),
26.10amounts included in composite judgments authorized by section 279.37, subdivision 1, are
26.11subject to interest at the rate calculated under subdivision 1a. During each calendar year,
26.12interest shall accrue on the unpaid balance of the composite judgment from the time it is
26.13confessed until it is paid. The rate of interest is subject to change each year in the same
26.14manner that section 549.09 or subdivision 1a, whichever is applicable, for rate changes.
26.15Interest on the unpaid contract balance on judgments confessed before July 1, 1982,
26.16is payable at the rate applicable to the judgment at the time that it was confessed. The
26.17interest rate established at the time the judgment is confessed is fixed for the duration of
26.18that judgment.
26.19(b) A confession of judgment covering any part of a parcel classified as 1a or 1b,
26.20and used as the homestead of the owner, is subject to interest at the rate provided in
26.21section 279.37, subdivision 2, paragraph (b). This paragraph does not apply to a relative
26.22homestead under section 273.124, subdivision 1, paragraph (c).
26.23EFFECTIVE DATE.This section is effective for confession judgments entered
26.24into on or after January 1, 2015.

26.25    Sec. 13. Minnesota Statutes 2013 Supplement, section 279.37, subdivision 2, is
26.26amended to read:
26.27    Subd. 2. Installment payments. (a) The owner of any such parcel, or any person to
26.28whom the right to pay taxes has been given by statute, mortgage, or other agreement, may
26.29make and file with the county auditor of the county in which the parcel is located a written
26.30offer to pay the current taxes each year before they become delinquent, or to contest the
26.31taxes under Minnesota Statutes 1941, sections 278.01 to 278.13, and agree to confess
26.32judgment for the amount provided, as determined by the county auditor. By filing the
26.33offer, the owner waives all irregularities in connection with the tax proceedings affecting
27.1the parcel and any defense or objection which the owner may have to the proceedings, and
27.2also waives the requirements of any notice of default in the payment of any installment or
27.3interest to become due pursuant to the composite judgment to be so entered. Unless the
27.4property is subject to subdivision 1a, with the offer, the owner shall (i) tender one-tenth of
27.5the amount of the delinquent taxes, costs, penalty, and interest, and (ii) tender all current
27.6year taxes and penalty due at the time the confession of judgment is entered. In the offer,
27.7the owner shall agree to pay the balance in nine equal installments, with interest as provided
27.8in section 279.03, payable annually on installments remaining unpaid from time to time, on
27.9or before December 31 of each year following the year in which judgment was confessed.
27.10(b) For property which qualifies under section 279.03, subdivision 2, paragraph (b),
27.11each year the commissioner shall set the interest rate for offers made under paragraph (a)
27.12at the greater of five percent or two percent above the prime rate charged by banks during
27.13the six-month period ending on September 30 of that year, rounded to the nearest full
27.14percent, provided that the rate must not exceed the maximum annum rate specified under
27.15section 279.03, subdivision 1a. The rate of interest becomes effective on January 1 of the
27.16immediately succeeding year. The commissioner's determination under this subdivision is
27.17not a rule subject to the Administrative Procedure Act in chapter 14, including section
27.1814.386. If a default occurs in the payments under any confessed judgment entered under
27.19this paragraph, the taxes and penalties due are subject to the interest rate specified in
27.20section 279.03.
27.21For the purposes of this subdivision:
27.22(1) the term "prime rate charged by banks" means the average predominant prime
27.23rate quoted by commercial banks to large businesses, as determined by the Board of
27.24Governors of the Federal Reserve System; and
27.25(2) "default" means the cancellation of the confession of judgment due to
27.26nonpayment of the current year tax or failure to make any installment payment required by
27.27this confessed judgment within 60 days from the date on which payment was due.
27.28(c) The interest rate established at the time judgment is confessed is fixed for the
27.29duration of the judgment. By October 15 of each year, the commissioner of revenue must
27.30determine the rate of interest as provided under paragraph (b) and, by November 1 of each
27.31year, must certify the rate to the county auditor.
27.32(d) A qualified property owner eligible to enter into a second confession of judgment
27.33may do so at the interest rate provided in paragraph (b).
27.34(e) Repurchase agreements or contracts for repurchase for properties being
27.35repurchased under section 282.261 are not eligible to receive the interest rate under
27.36paragraph (b).
28.1(f) The offer must be substantially as follows:
28.2"To the court administrator of the district court of ........... county, I, .....................,
28.3am the owner of the following described parcel of real estate located in ....................
28.4county, Minnesota:
28.5.............................. Upon that real estate there are delinquent taxes for the year ........., and
28.6prior years, as follows: (here insert year of delinquency and the total amount of delinquent
28.7taxes, costs, interest, and penalty). By signing this document I offer to confess judgment in
28.8the sum of $...... and waive all irregularities in the tax proceedings affecting these taxes and
28.9any defense or objection which I may have to them, and direct judgment to be entered for
28.10the amount stated above, minus the sum of $............, to be paid with this document, which
28.11is one-tenth or one-fifth of the amount of the taxes, costs, penalty, and interest stated above.
28.12I agree to pay the balance of the judgment in nine or four equal, annual installments, with
28.13interest as provided in section 279.03, payable annually, on the installments remaining
28.14unpaid. I agree to pay the installments and interest on or before December 31 of each year
28.15following the year in which this judgment is confessed and current taxes each year before
28.16they become delinquent, or within 30 days after the entry of final judgment in proceedings
28.17to contest the taxes under Minnesota Statutes, sections 278.01 to 278.13.
28.18Dated .............., ......."
28.19EFFECTIVE DATE.This section shall be effective for confession judgments
28.20entered into on or after January 1, 2015.

28.21    Sec. 14. Minnesota Statutes 2012, section 383E.21, subdivision 1, is amended to read:
28.22    Subdivision 1. Authority to levy property taxes and incur debt. (a) To finance the
28.23cost of designing, constructing, and acquiring countywide public safety improvements
28.24and equipment, including personal property, benefiting both Anoka County and the
28.25municipalities located within Anoka County, the governing body of Anoka County may
28.26 levy property taxes for public safety improvements and equipment, and issue:
28.27(1) capital improvement bonds under the provisions of section 373.40 as if the
28.28infrastructure and equipment qualified as a "capital improvement" within the meaning of
28.29section 373.40, subdivision 1, paragraph (b); and
28.30(2) capital notes under the provisions of section 373.01, subdivision 3, as if the
28.31equipment qualified as "capital equipment" within the meaning of section 373.01,
28.32subdivision 3. Personal property acquired with the proceeds of the bonds or capital
28.33notes issued under this section must have an expected useful life at least as long as the
28.34term of debt.
29.1(b) The outstanding principal amount of the bonds and the capital notes issued under
29.2this section may not exceed $8,000,000 at any time. Any bonds or notes issued pursuant
29.3to this section must only be issued after approval by a majority vote of the Anoka County
29.4Joint Law Enforcement Council, a joint powers board.
29.5EFFECTIVE DATE.This section is effective retroactively for taxes payable in
29.62013 and thereafter and expires under Minnesota Statutes, section 383E.21, subdivision 3.

29.7    Sec. 15. Minnesota Statutes 2012, section 383E.21, subdivision 2, is amended to read:
29.8    Subd. 2. Treatment of levy. Notwithstanding sections 275.065, subdivision 3,
29.9and 276.04, the county may report the tax attributable to any levy to fund public safety
29.10capital improvements or equipment projects approved by the Anoka County Joint Law
29.11Enforcement Council or pay principal and interest on bonds or notes issued under this
29.12section as a separate line item on the proposed property tax notice and the property tax
29.13statement. Notwithstanding any provision in chapter 275 or 373 to the contrary, bonds or
29.14notes issued by Anoka County under this section must not be included in the computation
29.15of the net debt of Anoka County.
29.16EFFECTIVE DATE.This section is effective retroactively for taxes payable in
29.172013 and thereafter and expires under Minnesota Statutes, section 383E.21, subdivision 3.

29.18    Sec. 16. Laws 1999, chapter 243, article 14, section 5, subdivision 1, is amended to read:
29.19    Subdivision 1. Board plan and program. The board shall adopt a comprehensive
29.20plan for the collection, treatment, and disposal of sewage in the district for a designated
29.21period the board deems proper and reasonable. The board shall prepare and adopt
29.22subsequent comprehensive plans for the collection, treatment, and disposal of sewage
29.23in the district for each succeeding designated period as the board deems proper and
29.24reasonable. All comprehensive plans of the district shall be subject to the planning
29.25and zoning authority of Scott county and in conformance with all planning and zoning
29.26ordinances of Scott county. The first plan, as modified by the board, and any subsequent
29.27plan shall take into account the preservation and best and most economic use of water and
29.28other natural resources in the area; the preservation, use, and potential for use of lands
29.29adjoining waters of the state to be used for the disposal of sewage; and the impact the
29.30disposal system will have on present and future land use in the area affected. In no case
29.31shall the comprehensive plan provide for more than 325 364 connections to the disposal
29.32system. All connections must be charged a full assessment. Connections made after the
29.33initial assessment period ends must be charged an amount equal to the initial assessment
30.1plus an adjustment for inflation and plus any other charges determined to be reasonable
30.2and necessary by the board. Deferred assessments may be permitted, as provided for in
30.3Minnesota Statutes, chapter 429. The plans shall include the general location of needed
30.4interceptors and treatment works, a description of the area that is to be served by the
30.5various interceptors and treatment works, a long-range capital improvements program, and
30.6any other details as the board deems appropriate. In developing the plans, the board shall
30.7consult with persons designated for the purpose by governing bodies of any governmental
30.8unit within the district to represent the entities and shall consider the data, resources, and
30.9input offered to the board by the entities and any planning agency acting on behalf of one
30.10or more of the entities. Each plan, when adopted, must be followed in the district and may
30.11be revised as often as the board deems necessary.
30.12EFFECTIVE DATE.This section is effective the day after the governing body of
30.13the Cedar Lake area water and sanitary sewer district and its chief clerical officer timely
30.14complete their compliance with Minnesota Statutes, section 645.021, subdivisions 2 and 3.

30.15    Sec. 17. HELENA TOWNSHIP, SCOTT COUNTY; REMOVAL OF
30.16SUBORDINATE SERVICE DISTRICT.
30.17    Subdivision 1. Application. This section applies to the subordinate service district
30.18established in Helena Township, Scott County, for the Silver Maple Bay Estates, under
30.19Minnesota Statutes, chapter 365A.
30.20    Subd. 2. Special provision for removal of the district. Notwithstanding the
30.21requirements of Minnesota Statutes, section 365A.095, subdivision 2, if the district is
30.22removed as provided in Minnesota Statutes, section 365A.095, subdivision 1, after all
30.23outstanding obligations of the district have been paid in full, the town board may vote to
30.24sell or use the surplus of any land or equipment, or the surplus of any tax revenue or service
30.25charge, or any part of it, collected from or associated with the district to connect the owners
30.26of any property within the discontinued district to another public sewer system. Any
30.27surplus not used to connect residents to such sewer system may be distributed equally to
30.28the owners of any property within the discontinued district that were charged the extra tax
30.29or service fee during the most recent tax year for which the tax or service fee was imposed.
30.30Any surplus not refunded under this section must be transferred to the town's general fund.
30.31EFFECTIVE DATE.This section is effective the day following final enactment.

30.32    Sec. 18. CITY OF JACKSON; LIMITATION ON ABATEMENTS.
31.1Notwithstanding the provisions of Minnesota Statutes, section 469.1813, subdivision
31.28, the total amount of property taxes abated by the city of Jackson in any year under
31.3Minnesota Statutes, section 469.1813, may not exceed the greater of (1) ten percent of
31.4the city's net tax capacity for the taxes payable year to which the abatement applies; or
31.5(2) $240,000.
31.6EFFECTIVE DATE.This section is effective for taxes payable in 2015 through
31.7taxes payable in 2019.

31.8    Sec. 19. STUDY OF ENERGY PRODUCING SYSTEMS.
31.9(a) The commissioner of revenue shall prepare a report on the taxation of electric
31.10energy producing systems in the state of Minnesota, including both traditional and
31.11renewable energy sources. For purposes of this study, traditional sources include coal,
31.12nuclear, and natural gas production and renewable sources include, but are not limited to,
31.13solar, wind, biomass, and hydro.
31.14(b) The report must, to the extent practicable under the appropriation and the time
31.15available:
31.16(1) describe, analyze, and compare the various methods by which the personal and
31.17real property of energy producing systems, using both traditional and renewable energy
31.18sources, are taxed under the property tax;
31.19(2) describe, analyze, and compare the availability of any exclusions, exemptions,
31.20or payment-in-lieu of taxation arrangements that apply to the systems and relative tax
31.21and economic effects of the arrangements;
31.22(3) evaluate the extent to which host political subdivisions and communities are
31.23compensated under the existing Minnesota property tax system for the external costs
31.24that the various types of production facilities impose on the host political subdivisions
31.25and communities;
31.26(4) compare the net cost of property and other taxes per unit of energy produced in
31.27Minnesota compared to its border states, for both traditional and renewable energy sources;
31.28(5) develop and evaluate alternative tax or fee systems for appropriately
31.29compensating host political subdivisions and communities for the external costs imposed
31.30by the facilities; and
31.31(6) make recommendations for the taxation of solar energy producing systems,
31.32including both real and personal property.
31.33(c) The commissioner shall report the findings of the study to the committees of the
31.34house of representatives and senate having jurisdiction over taxes by February 1, 2015,
31.35and file the report as required by Minnesota Statutes, section 3.195.
32.1(d) $150,000 is appropriated from the general fund in fiscal year 2015 to the
32.2commissioner of revenue for purposes of preparing the report under this section. This is a
32.3onetime appropriation and is not added to the base budget.
32.4EFFECTIVE DATE.This section is effective the day following final enactment.

32.5    Sec. 20. STUDY OF NORTH DAKOTA OIL PRODUCTION; IMPACT ON
32.6MINNESOTA.
32.7(a) $250,000 in fiscal year 2015 is appropriated from the general fund to the
32.8commissioner of employment and economic development, in consultation with the
32.9commissioner of revenue and the commissioner of transportation, to finance a study and
32.10analysis of the effects of current and projected oil production in North Dakota on the
32.11Minnesota economy with special focus on the northwestern region of Minnesota and area
32.12border cities as provided in paragraph (b).
32.13(b) The study and analysis must address:
32.14(1) current and projected economic, fiscal, and demographic effects and issues;
32.15(2) direct and indirect costs and benefits and positive and negative effects, including
32.16those upon workforce, taxation, and transportation, including the transportation of
32.17passengers and agricultural products by railroads; and
32.18(3) economic challenges and opportunities for economic growth or diversification.
32.19(c) The study must be objective, evidence-based, and designed to produce empirical
32.20data. Study data must be utilized to formulate policy recommendations on how the state,
32.21the northwestern region of the state, and border cities may respond to the challenges and
32.22opportunities for economic growth and financial investment that may be derived from the
32.23regional economic changes that are the result of oil production in North Dakota.
32.24(d) For the purposes of this section, "border cities" has the meaning given in
32.25Minnesota Statutes, section 469.1731.
32.26(e) The study and analysis must be conducted by an independent entity with
32.27demonstrated knowledge in the following areas:
32.28(1) the economy and demography of Minnesota;
32.29(2) the domestic and foreign oil industry; and
32.30(3) technologies, markets, and geopolitical factors that have an impact on current
32.31and future oil production in the region.
32.32(f) The commissioner shall report on the findings and recommendations of the study
32.33to the committees of the house of representatives and senate having jurisdiction over
32.34economic development, workforce issues, and taxation by February 15, 2015.
33.1EFFECTIVE DATE.This section is effective the day following final enactment.

33.2ARTICLE 3
33.3SALES, USE, AND EXCISE TAXES

33.4    Section 1. Minnesota Statutes 2013 Supplement, section 116J.8738, subdivision 2,
33.5is amended to read:
33.6    Subd. 2. Qualified business. (a) A business is a qualified business if it satisfies the
33.7requirement of this paragraph and is not disqualified under the provisions of paragraph
33.8(b). To qualify, the business must:
33.9(1) have operated its trade or business in a city or cities in greater Minnesota for at
33.10least one year before applying under subdivision 3;
33.11(2) pay or agree to pay in the future each employee compensation, including benefits
33.12not mandated by law, that on an annualized basis equal at least 120 percent of the federal
33.13poverty level for a family of four;
33.14(3) plan and agree to expand its employment in one or more cities in greater Minnesota
33.15by the minimum number of employees required under subdivision 3, paragraph (c); and
33.16(4) have received certification from the commissioner under subdivision 3 that
33.17it is a qualified business.
33.18(b) A business is not a qualified business if it is either:
33.19(1) primarily engaged in making retail sales to purchasers who are physically present
33.20at the business's location or locations in greater Minnesota; or
33.21(2) a public utility, as defined in section 336B.01; or
33.22(3) primarily engaged in lobbying; gambling; entertainment; professional sports;
33.23political consulting; leisure; hospitality; or professional services provided by attorneys,
33.24accountants, business consultants, physicians, or health care consultants.
33.25(c) The requirements in paragraph (a) that the business's operations and expansion
33.26be located in a city do not apply to an agricultural processing facility.
33.27EFFECTIVE DATE.This section is effective the day following final enactment.

33.28    Sec. 2. Minnesota Statutes 2013 Supplement, section 116J.8738, subdivision 3, is
33.29amended to read:
33.30    Subd. 3. Certification of qualified business. (a) A business may apply to the
33.31commissioner for certification as a qualified business under this section. The commissioner
33.32shall specify the form of the application, the manner and times for applying, and the
33.33information required to be included in the application. The commissioner may impose an
34.1application fee in an amount sufficient to defray the commissioner's cost of processing
34.2certifications. A business must file a copy of its application with the chief clerical officer
34.3of the city at the same time it applies to the commissioner. For an agricultural processing
34.4facility located outside the boundaries of a city, the business must file a copy of the
34.5application with the county auditor.
34.6(b) The commissioner shall certify each business as a qualified business that:
34.7(1) satisfies the requirements of subdivision 2;
34.8(2) the commissioner determines would not expand its operations in greater
34.9Minnesota without the tax incentives available under subdivision 4; and
34.10(3) enters a business subsidy agreement with the commissioner that pledges to
34.11satisfy the minimum expansion requirements of paragraph (c) within three years or less
34.12following execution of the agreement.
34.13The commissioner must act on an application within 60 90 days after its filing.
34.14Failure by the commissioner to take action within the 60-day 90-day period is deemed
34.15approval of the application.
34.16(c) The following minimum expansion requirements apply, based on the number of
34.17employees of the business at locations in greater Minnesota:
34.18(1) a business that employs 50 or fewer full-time equivalent employees in greater
34.19Minnesota when the agreement is executed must increase its employment by five or more
34.20full-time equivalent employees;
34.21(2) a business that employs more than 50 but fewer than 200 full-time equivalent
34.22employees in greater Minnesota when the agreement is executed must increase the number
34.23of its full-time equivalent employees in greater Minnesota by at least ten percent; or
34.24(3) a business that employs 200 or more full-time equivalent employees in greater
34.25Minnesota when the agreement is executed must increase its employment by at least 21
34.26full-time equivalent employees (c) The business must increase the number of full-time
34.27equivalent employees in greater Minnesota from the time the business subsidy agreement
34.28is executed by two employees or ten percent, whichever is greater.
34.29(d) The city, or a county for an agricultural processing facility located outside the
34.30boundaries of a city, in which the business proposes to expand its operations may file
34.31comments supporting or opposing the application with the commissioner. The comments
34.32must be filed within 30 days after receipt by the city of the application and may include a
34.33notice of any contribution the city or county intends to make to encourage or support the
34.34business expansion, such as the use of tax increment financing, property tax abatement,
34.35additional city or county services, or other financial assistance.
35.1(e) Certification of a qualified business is effective for the 12-year seven-year period
35.2beginning on the first day of the calendar month immediately following execution of
35.3the business subsidy agreement the date that the commissioner informs the business of
35.4the award of the benefit.
35.5EFFECTIVE DATE.This section is effective the day following final enactment.

35.6    Sec. 3. Minnesota Statutes 2013 Supplement, section 116J.8738, subdivision 4, is
35.7amended to read:
35.8    Subd. 4. Available tax incentives. A qualified business is entitled to a sales tax
35.9exemption, up to $2,000,000 annually and $10,000,000 during the total period of the
35.10agreement, as provided in section 297A.68, subdivision 44, for purchases made during
35.11the period the business was certified as a qualified business under this section. The
35.12commissioner has discretion to set the maximum amounts of the annual and total sales tax
35.13exemption allowed for each qualifying business as part of the business subsidy agreement.
35.14EFFECTIVE DATE.This section is effective the day following final enactment.

35.15    Sec. 4. Minnesota Statutes 2013 Supplement, section 289A.20, subdivision 4, is
35.16amended to read:
35.17    Subd. 4. Sales and use tax. (a) The taxes imposed by chapter 297A are due and
35.18payable to the commissioner monthly on or before the 20th day of the month following the
35.19month in which the taxable event occurred, or following another reporting period as the
35.20commissioner prescribes or as allowed under section 289A.18, subdivision 4, paragraph
35.21(f) or (g), except that use taxes due on an annual use tax return as provided under section
35.22289A.11, subdivision 1 , are payable by April 15 following the close of the calendar year.
35.23    (b) A vendor having a liability of $120,000 $250,000 or more during a fiscal year
35.24ending June 30 must remit the June liability for the next year in the following manner:
35.25    (1) Two business days before June 30 of the year, the vendor must remit 90 81.4
35.26 percent of the estimated June liability to the commissioner.
35.27    (2) On or before August 20 of the year, the vendor must pay any additional amount
35.28of tax not remitted in June.
35.29    (c) A vendor having a liability of:
35.30    (1) $10,000 or more, but less than $120,000 $250,000 during a fiscal year ending
35.31June 30, 2013, and fiscal years thereafter, must remit by electronic means all liabilities
35.32on returns due for periods beginning in all subsequent calendar years on or before the
35.3320th day of the month following the month in which the taxable event occurred, or on
36.1or before the 20th day of the month following the month in which the sale is reported
36.2under section 289A.18, subdivision 4; or
36.3(2) $120,000 $250,000 or more, during a fiscal year ending June 30, 2009 2013,
36.4and fiscal years thereafter, must remit by electronic means all liabilities in the manner
36.5provided in paragraph (a) on returns due for periods beginning in the subsequent calendar
36.6year, except for 90 81.4 percent of the estimated June liability, which is due two business
36.7days before June 30. The remaining amount of the June liability is due on August 20.
36.8(d) Notwithstanding paragraph (b) or (c), a person prohibited by the person's
36.9religious beliefs from paying electronically shall be allowed to remit the payment by mail.
36.10The filer must notify the commissioner of revenue of the intent to pay by mail before
36.11doing so on a form prescribed by the commissioner. No extra fee may be charged to a
36.12person making payment by mail under this paragraph. The payment must be postmarked
36.13at least two business days before the due date for making the payment in order to be
36.14considered paid on a timely basis.
36.15EFFECTIVE DATE.This section is effective for taxes remitted after May 30, 2014.

36.16    Sec. 5. Minnesota Statutes 2012, section 289A.60, subdivision 15, is amended to read:
36.17    Subd. 15. Accelerated payment of June sales tax liability; penalty for
36.18underpayment. For payments made after December 31, 2006 2013, if a vendor is
36.19required by law to submit an estimation of June sales tax liabilities and 90 81.4 percent
36.20payment by a certain date, the vendor shall pay a penalty equal to ten percent of the
36.21amount of actual June liability required to be paid in June less the amount remitted in
36.22June. The penalty must not be imposed, however, if the amount remitted in June equals
36.23the lesser of 90 81.4 percent of the preceding May's liability or 90 81.4 percent of the
36.24average monthly liability for the previous calendar year.
36.25EFFECTIVE DATE.This section is effective for taxes remitted after May 30, 2014.

36.26    Sec. 6. Minnesota Statutes 2012, section 297A.67, subdivision 13a, is amended to read:
36.27    Subd. 13a. Instructional materials. Instructional materials, other than textbooks,
36.28that are prescribed for use in conjunction with a course of study in a postsecondary school,
36.29college, university, or private career school to students who are regularly enrolled at such
36.30institutions are exempt. For purposes of this subdivision, "instructional materials" means
36.31materials required to be used directly in the completion of the course of study, including,
36.32but not limited to, interactive CDs, tapes, digital audio works, digital audiovisual works,
36.33and computer software.
37.1Instructional materials do not include general reference works or other items
37.2incidental to the instructional process such as pens, pencils, paper, folders, or computers.
37.3For purposes of this subdivision, "school" and "private career school" have the meanings
37.4given in subdivision 13.
37.5EFFECTIVE DATE.This section is effective the day following final enactment.

37.6    Sec. 7. Minnesota Statutes 2012, section 297A.67, is amended by adding a subdivision
37.7to read:
37.8    Subd. 33. Presentations accessed as digital audio and audiovisual works.
37.9The charge for a live or prerecorded presentation, such as a lecture, seminar,
37.10workshop, or course, where participants access the presentation as a digital audio
37.11work or digital audiovisual work, and are connected to the presentation via the
37.12Internet, telecommunications equipment or other device that transfers the presentation
37.13electronically, is exempt if:
37.14(1) participants and the presenter, during the time that participants access the
37.15presentation, are able to give, receive, and discuss the presentation with each other,
37.16although the amount of interaction and when in the presentation the interaction occurs
37.17may be limited by the presenter; and
37.18(2) for those presentations where participants are given the option to attend the
37.19same presentation in person:
37.20(i) any limitations on the amount of interaction and when it occurs during the
37.21presentation are the same for those participants accessing the presentation electronically
37.22as those attending in person; and
37.23(ii) the admission to the in person presentation is not subject to tax under this chapter.
37.24EFFECTIVE DATE.This section is effective for sales and purchases made after
37.25June 30, 2014.

37.26    Sec. 8. Minnesota Statutes 2012, section 297A.68, is amended by adding a subdivision
37.27to read:
37.28    Subd. 3a. Coin-operated entertainment and amusement devices. Coin-operated
37.29entertainment and amusement devices including, but not limited to, fortune-telling
37.30machines, cranes, foosball and pool tables, video and pinball games, batting cages, rides,
37.31photo or video booths, and jukeboxes, are exempt when purchased by retailers selling
37.32admission to places of amusement and making available amusement devices as provided
37.33in section 297A.61, subdivision 3, paragraph (g), clause (1). Coin-operated entertainment
38.1and amusement devices do not include vending machines, lottery devices, or gaming
38.2devices as described in chapters 297E and 349.
38.3EFFECTIVE DATE.This section is effective for sales and purchases made after
38.4June 30, 2014.

38.5    Sec. 9. Minnesota Statutes 2013 Supplement, section 297A.68, subdivision 42, is
38.6amended to read:
38.7    Subd. 42. Qualified data centers. (a) Purchases of enterprise information
38.8technology equipment and computer software for use in a qualified data center, or a
38.9qualified refurbished data center, are exempt, except that computer software maintenance
38.10agreements are exempt for purchases made after June 30, 2013. The tax on purchases
38.11exempt under this paragraph must be imposed and collected as if the rate under section
38.12297A.62, subdivision 1 , applied, and then refunded after June 30, 2013, in the manner
38.13provided in section 297A.75. This exemption includes enterprise information technology
38.14equipment and computer software purchased to replace or upgrade enterprise information
38.15technology equipment and computer software in a qualified data center, or a qualified
38.16refurbished data center.
38.17(b) Electricity used or consumed in the operation of a qualified data center or
38.18qualified refurbished data center is exempt.
38.19(c) For purposes of this subdivision, "qualified data center, or a qualified refurbished
38.20data center, " means a facility in Minnesota:
38.21(1) that is comprised of one or more buildings that consist in the aggregate of
38.22at least 25,000 square feet, and that are located on a single parcel or on contiguous
38.23parcels, where the total cost of construction or refurbishment, investment in enterprise
38.24information technology equipment, and computer software is at least $30,000,000 within a
38.2548-month period. The 48-month period begins no sooner than July 1, 2012, except that
38.26costs for computer software maintenance agreements purchased before July 1, 2013, are
38.27not included in determining if the $30,000,000 threshold has been met;
38.28(2) that is constructed or substantially refurbished after June 30, 2012, where
38.29"substantially refurbished" means that at least 25,000 square feet have been rebuilt or
38.30modified, including:
38.31(i) installation of enterprise information technology equipment,; environmental
38.32control, computer software, and energy efficiency improvements; and
38.33(ii) building improvements; and
38.34(3) that is used to house enterprise information technology equipment, where the
38.35facility has the following characteristics:
39.1(i) uninterruptible power supplies, generator backup power, or both;
39.2(ii) sophisticated fire suppression and prevention systems; and
39.3(iii) enhanced security. A facility will be considered to have enhanced security if it
39.4has restricted access to the facility to selected personnel; permanent security guards; video
39.5camera surveillance; an electronic system requiring pass codes, keycards, or biometric
39.6scans, such as hand scans and retinal or fingerprint recognition; or similar security features.
39.7In determining whether the facility has the required square footage, the square footage
39.8of the following spaces shall be included if the spaces support the operation of enterprise
39.9information technology equipment: office space, meeting space, and mechanical and
39.10other support facilities. For purposes of this subdivision, "computer software" includes,
39.11but is not limited to, software utilized or loaded at the a qualified data center or qualified
39.12refurbished data center, including maintenance, licensing, and software customization.
39.13(d) For purposes of this subdivision, a "qualified refurbished data center" means an
39.14existing facility that qualifies as a data center under paragraph (c), clauses (2) and (3), but
39.15that is comprised of one or more buildings that consist in the aggregate of at least 25,000
39.16square feet, and that are located on a single parcel or contiguous parcels, where the total
39.17cost of construction or refurbishment, investment in enterprise information technology
39.18equipment, and computer software is at least $50,000,000 within a 24-month period.
39.19(e) For purposes of this subdivision, "enterprise information technology equipment"
39.20means computers and equipment supporting computing, networking, or data storage,
39.21including servers and routers. It includes, but is not limited to: cooling systems,
39.22cooling towers, and other temperature control infrastructure; power infrastructure for
39.23transformation, distribution, or management of electricity used for the maintenance and
39.24operation of a qualified data center or qualified refurbished data center, including but
39.25not limited to exterior dedicated business-owned substations, backup power generation
39.26systems, battery systems, and related infrastructure; and racking systems, cabling, and
39.27trays, which are necessary for the a maintenance and operation of the qualified data center
39.28or qualified refurbished data center.
39.29(f) A qualified data center or qualified refurbished data center may claim the
39.30exemptions in this subdivision for purchases made either within 20 years of the date of
39.31its first purchase qualifying for the exemption under paragraph (a), or by June 30, 2042,
39.32whichever is earlier.
39.33(g) The purpose of this exemption is to create jobs in the construction and data
39.34center industries.
39.35(h) This subdivision is effective for sales and purchases made after June 30, 2012,
39.36and before July 1, 2042.
40.1(i)(1) The commissioner of employment and economic development must certify
40.2to the commissioner of revenue, in a format approved by the commissioner of revenue,
40.3when a qualified data center has met the requirements under paragraph (c) or a qualified
40.4refurbished data center has met the requirements under paragraph (d). The certification
40.5must provide the following information regarding each qualified data center or qualified
40.6refurbished data center:
40.7(i) the total square footage amount;
40.8(ii) the total amount of construction or refurbishment costs and the total amount of
40.9qualifying investments in enterprise information technology equipment and computer
40.10software; and
40.11(iii) the beginning and ending of the applicable period under either paragraph (c) or
40.12(d) in which the qualifying expenditures and purchases under item (ii) were made, but in
40.13no case shall the period begin before July 1, 2012;
40.14(2) Any refund for sales tax paid on qualifying purchases under this subdivision must
40.15not be issued unless the commissioner of revenue has received the certification required
40.16under clause (1) either from the commissioner of employment and economic development
40.17or the qualified data center or qualified refurbished data center claiming the refund; and
40.18(3) The commissioner of employment and economic development must annually
40.19notify the commissioner of revenue of the qualified data centers that are projected to meet
40.20the requirements under paragraph (c) and the qualified refurbished data centers that are
40.21projected to meet the requirements under paragraph (d) in each of the next four years. The
40.22notification must provide the information required under clause (1), items (i) to (iii), for
40.23each qualified data center or qualified refurbished data center.
40.24EFFECTIVE DATE.This section is effective the day following final enactment.

40.25    Sec. 10. Minnesota Statutes 2013 Supplement, section 297A.68, subdivision 44,
40.26is amended to read:
40.27    Subd. 44. Greater Minnesota business expansions. (a) Purchases and use of
40.28tangible personal property or taxable services by a qualified business, as defined in section
40.29116J.8738 , are exempt if:
40.30(1) the business subsidy agreement provides that the exemption under this
40.31subdivision applies;
40.32(2) the property or services are primarily used or consumed at the facility in greater
40.33Minnesota identified in the business subsidy agreement; and
40.34(3) the purchase was made and delivery received during the duration of the
40.35certification of the business as a qualified business under section 116J.8738.
41.1(b) Purchase and use of construction materials and supplies used or consumed in,
41.2and equipment incorporated into, the construction of improvements to real property in
41.3greater Minnesota are exempt if the improvements after completion of construction are
41.4to be used in the conduct of the trade or business of the qualified business, as defined in
41.5section 116J.8738. This exemption applies regardless of whether the purchases are made
41.6by the business or a contractor.
41.7(c) The exemptions under this subdivision apply to a local sales and use tax.
41.8(d) The tax on purchases imposed under this subdivision must be imposed and
41.9collected as if the rate under section 297A.62 applied, and then refunded in the manner
41.10provided in section 297A.75. The total amount refunded for a facility over the certification
41.11period is limited to the amount listed in the business subsidy agreement. No more than
41.12$7,000,000 may be refunded in a fiscal year for all purchases under this subdivision.
41.13Refunds must be allocated on a first-come, first-served basis. If more than $7,000,000 of
41.14eligible claims are made in a fiscal year, claims by qualified businesses carry over to the
41.15next fiscal year, and the commissioner must first allocate refunds to qualified businesses
41.16eligible for a refund in the preceding fiscal year. Any portion of the balance of funds
41.17allocated for refunds under this paragraph does not cancel and shall be carried forward to
41.18and available for refunds in subsequent fiscal years. Notwithstanding section 297A.75,
41.19subdivision 4, for an eligible refund claim that carries over to a subsequent fiscal year, the
41.20interest on the amount carried over must be paid on the refund no sooner than from 90
41.21days after July 1 of the fiscal year in which funds are available for the eligible claim.
41.22EFFECTIVE DATE.This section is effective the day following final enactment.

41.23    Sec. 11. Minnesota Statutes 2013 Supplement, section 297A.70, subdivision 2, is
41.24amended to read:
41.25    Subd. 2. Sales to government. (a) All sales, except those listed in paragraph (b),
41.26to the following governments and political subdivisions, or to the listed agencies or
41.27instrumentalities of governments and political subdivisions, are exempt:
41.28(1) the United States and its agencies and instrumentalities;
41.29(2) school districts, local governments, the University of Minnesota, state universities,
41.30community colleges, technical colleges, state academies, the Perpich Minnesota Center for
41.31Arts Education, and an instrumentality of a political subdivision that is accredited as an
41.32optional/special function school by the North Central Association of Colleges and Schools;
41.33(3) hospitals and nursing homes owned and operated by political subdivisions of
41.34the state of tangible personal property and taxable services used at or by hospitals and
41.35nursing homes;
42.1(4) notwithstanding paragraph (d), the sales and purchases by the Metropolitan
42.2Council, for its purchases of vehicles and repair parts to equip operations provided for in
42.3section 473.4051 are exempt through December 31, 2016;
42.4(5) other states or political subdivisions of other states, if the sale would be exempt
42.5from taxation if it occurred in that state; and
42.6(6) public libraries, public library systems, multicounty, multitype library systems
42.7as defined in section 134.001, county law libraries under chapter 134A, state agency
42.8libraries, the state library under section 480.09, and the Legislative Reference Library.
42.9(b) This exemption does not apply to the sales of the following products and services:
42.10(1) building, construction, or reconstruction materials purchased by a contractor
42.11or a subcontractor as a part of a lump-sum contract or similar type of contract with a
42.12guaranteed maximum price covering both labor and materials for use in the construction,
42.13alteration, or repair of a building or facility;
42.14(2) construction materials purchased by tax exempt entities or their contractors to
42.15be used in constructing buildings or facilities which will not be used principally by the
42.16tax exempt entities;
42.17(3) the leasing of a motor vehicle as defined in section 297B.01, subdivision 11,
42.18except for leases entered into by the United States or its agencies or instrumentalities;
42.19(4) lodging as defined under section 297A.61, subdivision 3, paragraph (g), clause
42.20(2), and prepared food, candy, soft drinks, and alcoholic beverages as defined in section
42.21297A.67, subdivision 2 , except for lodging, prepared food, candy, soft drinks, and alcoholic
42.22beverages purchased directly by the United States or its agencies or instrumentalities; or
42.23(5) goods or services purchased by a local government as inputs to goods and
42.24services that are generally provided by a private business and the purchases would be
42.25taxable if made by a private business engaged in the same activity a liquor store, gas or
42.26electric utility, solid waste hauling service, solid waste recycling service, landfill, golf
42.27course, marina, campground, cafe, or laundromat.
42.28(c) As used in this subdivision, "school districts" means public school entities and
42.29districts of every kind and nature organized under the laws of the state of Minnesota, and
42.30any instrumentality of a school district, as defined in section 471.59.
42.31(d) As used in this subdivision For purposes of the exemption granted under this
42.32subdivision, "local governments" means has the following meaning:
42.33(1) for the period prior to January 1, 2016, local governments means statutory or
42.34home rule charter cities, counties, and townships;
42.35(2) for the period of January 1, 2016, to December 31, 2016, local governments
42.36means statutory or home rule charter cities, counties, and townships; special districts as
43.1defined under section 6.465, except for the Metropolitan Council under sections 473.123
43.2to 473.549; any instrumentality of a statutory or home rule charter city, county, or
43.3township as defined in section 471.59; and any joint powers board or organization created
43.4under section 471.59; and
43.5(3) beginning January 1, 2017, local governments means statutory or home rule
43.6charter cities, counties, and townships; special districts as defined under section 6.465; any
43.7instrumentality of a statutory or home rule charter city, county, or township as defined in
43.8section 471.59; and any joint powers board or organization created under section 471.59.
43.9(e) As used in this subdivision, "goods or services generally provided by a private
43.10business" include, but are not limited to, goods or services provided by liquor stores, gas
43.11and electric utilities, golf courses, marinas, health and fitness centers, campgrounds, cafes,
43.12and laundromats. "Goods or services generally provided by a private business" do not
43.13include housing services, sewer and water services, wastewater treatment, ambulance and
43.14other public safety services, correctional services, chore or homemaking services provided
43.15to elderly or disabled individuals, or road and street maintenance or lighting.
43.16EFFECTIVE DATE.This section is effective for sales and purchases made after
43.17June 30, 2014.

43.18    Sec. 12. Minnesota Statutes 2013 Supplement, section 297A.70, subdivision 13,
43.19is amended to read:
43.20    Subd. 13. Fund-raising sales by or for nonprofit groups. (a) The following
43.21sales by the specified organizations for fund-raising purposes are exempt, subject to the
43.22limitations listed in paragraph (b):
43.23(1) all sales made by a nonprofit organization that exists solely for the purpose of
43.24providing educational or social activities for young people primarily age 18 and under;
43.25(2) all sales made by an organization that is a senior citizen group or association of
43.26groups if (i) in general it limits membership to persons age 55 or older; (ii) it is organized
43.27and operated exclusively for pleasure, recreation, and other nonprofit purposes; and (iii)
43.28no part of its net earnings inures to the benefit of any private shareholders;
43.29(3) the sale or use of tickets or admissions to a golf tournament held in Minnesota if
43.30the beneficiary of the tournament's net proceeds qualifies as a tax-exempt organization
43.31under section 501(c)(3) of the Internal Revenue Code; and
43.32(4) sales of candy sold for fund-raising purposes by a nonprofit organization that
43.33provides educational and social activities primarily for young people age 18 and under.
43.34(b) The exemptions listed in paragraph (a) are limited in the following manner:
44.1(1) the exemption under paragraph (a), clauses (1) and (2), applies only if to the first
44.2$20,000 of the gross annual receipts of the organization from fund-raising do not exceed
44.3$10,000; and
44.4(2) the exemption under paragraph (a), clause (1), does not apply if the sales are
44.5derived from admission charges or from activities for which the money must be deposited
44.6with the school district treasurer under section 123B.49, subdivision 2, or be recorded in
44.7the same manner as other revenues or expenditures of the school district under section
44.8123B.49, subdivision 4 .
44.9(c) Sales of tangible personal property and services are exempt if the entire proceeds,
44.10less the necessary expenses for obtaining the property or services, will be contributed to
44.11a registered combined charitable organization described in section 43A.50, to be used
44.12exclusively for charitable, religious, or educational purposes, and the registered combined
44.13charitable organization has given its written permission for the sale. Sales that occur over
44.14a period of more than 24 days per year are not exempt under this paragraph.
44.15(d) For purposes of this subdivision, a club, association, or other organization of
44.16elementary or secondary school students organized for the purpose of carrying on sports,
44.17educational, or other extracurricular activities is a separate organization from the school
44.18district or school for purposes of applying the $10,000 $20,000 limit.
44.19EFFECTIVE DATE.This section is effective for sales and purchases made after
44.20December 31, 2014.

44.21    Sec. 13. Minnesota Statutes 2013 Supplement, section 297A.70, subdivision 14,
44.22is amended to read:
44.23    Subd. 14. Fund-raising events sponsored by nonprofit groups. (a) Sales of
44.24tangible personal property or services at, and admission charges for fund-raising events
44.25sponsored by, a nonprofit organization are exempt if:
44.26(1) all gross receipts are recorded as such, in accordance with generally accepted
44.27accounting practices, on the books of the nonprofit organization; and
44.28(2) the entire proceeds, less the necessary expenses for the event, will be used solely
44.29and exclusively for charitable, religious, or educational purposes. Exempt sales include
44.30the sale of prepared food, candy, and soft drinks at the fund-raising event.
44.31(b) This exemption is limited in the following manner:
44.32(1) it does not apply to admission charges for events involving bingo or other
44.33gambling activities or to charges for use of amusement devices involving bingo or other
44.34gambling activities;
45.1(2) all gross receipts are taxable if the profits are not used solely and exclusively for
45.2charitable, religious, or educational purposes;
45.3(3) it does not apply unless the organization keeps a separate accounting record,
45.4including receipts and disbursements from each fund-raising event that documents all
45.5deductions from gross receipts with receipts and other records;
45.6(4) it does not apply to any sale made by or in the name of a nonprofit corporation as
45.7the active or passive agent of a person that is not a nonprofit corporation;
45.8(5) all gross receipts are taxable if fund-raising events exceed 24 days per year;
45.9(6) it does not apply to fund-raising events conducted on premises leased for more
45.10than five days but less than 30 days; and
45.11(7) it does not apply if the risk of the event is not borne by the nonprofit organization
45.12and the benefit to the nonprofit organization is less than the total amount of the state and
45.13local tax revenues forgone by this exemption.
45.14(c) For purposes of this subdivision, a "nonprofit organization" means any unit of
45.15government, corporation, society, association, foundation, or institution organized and
45.16operated for charitable, religious, educational, civic, fraternal, and senior citizens' or
45.17veterans' purposes, no part of the net earnings of which inures to the benefit of a private
45.18individual.
45.19(d) For purposes of this subdivision, "fund-raising events" means activities of
45.20limited duration, not regularly carried out in the normal course of business, that attract
45.21patrons for community, social, and entertainment purposes, such as auctions, bake sales,
45.22ice cream socials, block parties, carnivals, competitions, concerts, concession stands,
45.23craft sales, bazaars, dinners, dances, door-to-door sales of merchandise, fairs, fashion
45.24shows, festivals, galas, special event workshops, sporting activities such as marathons and
45.25tournaments, and similar events. Fund-raising events do not include the operation of a
45.26regular place of business in which services are provided or sales are made during regular
45.27hours such as bookstores, thrift stores, gift shops, restaurants, ongoing Internet sales,
45.28regularly scheduled classes, or other activities carried out in the normal course of business.
45.29EFFECTIVE DATE.This section is effective the day following final enactment.

45.30    Sec. 14. Minnesota Statutes 2012, section 297A.70, is amended by adding a
45.31subdivision to read:
45.32    Subd. 19. Nonprofit snowmobile clubs; machinery and equipment. Sales of
45.33tangible personal property to a nonprofit snowmobile club that is used primarily and
45.34directly for the grooming of state or grant-in-aid snowmobile trails are exempt. The
45.35exemption applies to grooming machines, attachments, other associated accessories,
46.1and repair parts. A nonprofit snowmobile club is eligible for the exemption under this
46.2subdivision if it received, in the current year or in the previous three-year period, a state
46.3grant-in-aid maintenance and grooming grant administered by the Department of Natural
46.4Resources by applying for the grant with a local unit of government sponsor.
46.5EFFECTIVE DATE.This section is effective for sales and purchases made after
46.6June 30, 2014.

46.7    Sec. 15. Minnesota Statutes 2013 Supplement, section 297F.05, subdivision 1, is
46.8amended to read:
46.9    Subdivision 1. Rates; cigarettes. A tax is imposed upon the sale of cigarettes in
46.10this state, upon having cigarettes in possession in this state with intent to sell, upon any
46.11person engaged in business as a distributor, and upon the use or storage by consumers, at
46.12the following rates: rate of
46.13(1) on cigarettes weighing not more than three pounds per thousand, 141.5 mills,
46.14or 14.15 cents on each such cigarette; and
46.15(2) on cigarettes weighing more than three pounds per thousand, 283 mills on each
46.16such cigarette.
46.17EFFECTIVE DATE.This section is effective July 1, 2014.

46.18    Sec. 16. Minnesota Statutes 2012, section 297F.09, subdivision 10, is amended to read:
46.19    Subd. 10. Accelerated tax payment; cigarette or tobacco products distributor.
46.20    A cigarette or tobacco products distributor having a liability of $120,000 $250,000 or
46.21more during a fiscal year ending June 30, shall remit the June liability for the next year
46.22in the following manner:
46.23    (a) Two business days before June 30 of the year, the distributor shall remit the
46.24actual May liability and 90 81.4 percent of the estimated June liability to the commissioner
46.25and file the return in the form and manner prescribed by the commissioner.
46.26    (b) On or before August 18 of the year, the distributor shall submit a return showing
46.27the actual June liability and pay any additional amount of tax not remitted in June. A
46.28penalty is imposed equal to ten percent of the amount of June liability required to be paid
46.29in June, less the amount remitted in June. However, the penalty is not imposed if the
46.30amount remitted in June equals the lesser of:
46.31    (1) 90 81.4 percent of the actual June liability; or
46.32    (2) 90 81.4 percent of the preceding May's May liability.
46.33EFFECTIVE DATE.This section is effective for taxes remitted after May 30, 2014.

47.1    Sec. 17. Minnesota Statutes 2012, section 297G.03, is amended by adding a
47.2subdivision to read:
47.3    Subd. 5. Microdistillery credit. (a) A qualified distiller producing distilled spirits is
47.4entitled to a tax credit of $1.33 per liter on 100,000 liters sold in any fiscal year beginning
47.5July 1. A qualified distiller may take the credit on the 18th day of each month, but the total
47.6credit allowed may not exceed in any fiscal year the lesser of:
47.7(1) the liability for tax; or
47.8(2) $133,000.
47.9(b) For purposes of this subdivision, "qualified distiller" means a microdistillery
47.10qualifying under section 340A.101, subdivision 17a, in the calendar year immediately
47.11preceding the calendar year for which the credit under this subdivision is claimed.
47.12EFFECTIVE DATE.This section is effective July 1, 2014.

47.13    Sec. 18. [297G.032] MICRODISTILLERIES.
47.14A microdistillery, licensed under section 340A.301, is a wholesaler for purposes
47.15of the excise tax imposed on distilled spirits given by the microdistillery as samples or
47.16sold in cocktail rooms permitted under chapter 340A. Returns must be made in a form
47.17and manner prescribed by the commissioner, and must contain any other information
47.18required by the commissioner.
47.19EFFECTIVE DATE.This section is effective July 1, 2014.

47.20    Sec. 19. Minnesota Statutes 2012, section 297G.09, subdivision 9, is amended to read:
47.21    Subd. 9. Accelerated tax payment; penalty. A person liable for tax under this
47.22chapter having a liability of $120,000 $250,000 or more during a fiscal year ending June
47.2330, shall remit the June liability for the next year in the following manner:
47.24    (a) Two business days before June 30 of the year, the taxpayer shall remit the actual
47.25May liability and 90 81.4 percent of the estimated June liability to the commissioner and
47.26file the return in the form and manner prescribed by the commissioner.
47.27    (b) On or before August 18 of the year, the taxpayer shall submit a return showing
47.28the actual June liability and pay any additional amount of tax not remitted in June. A
47.29penalty is imposed equal to ten percent of the amount of June liability required to be paid
47.30in June less the amount remitted in June. However, the penalty is not imposed if the
47.31amount remitted in June equals the lesser of:
47.32    (1) 90 81.4 percent of the actual June liability; or
47.33    (2) 90 81.4 percent of the preceding May liability.
48.1EFFECTIVE DATE.This section is effective for taxes remitted after May 30, 2014.

48.2    Sec. 20. Minnesota Statutes 2013 Supplement, section 360.531, subdivision 2, is
48.3amended to read:
48.4    Subd. 2. Rate. The tax shall be as follows:
48.5
Base Price
Tax
48.6
48.7
Under $499,999
Not over $500,000
$100
48.8
48.9
over $500,000 to $999,999
but not over $1,000,000
$200
48.10
48.11
over $1,000,000 to $2,499,999
but not over $2,500,000
$2,000
48.12
48.13
over $2,500,000 to $4,999,999
but not over $5,000,000
$4,000
48.14
48.15
over $5,000,000 to $7,499,999
but not over $7,500,000
$7,500
48.16
48.17
over $7,500,000 to $9,999,999
but not over $10,000,000
$10,000
48.18
48.19
over $10,000,000 to $12,499,999
but not over $12,500,000
$12,500
48.20
48.21
over $12,500,000 to $14,999,999
but not over $15,000,000
$15,000
48.22
48.23
over $15,000,000 to $17,499,999
but not over $17,500,000
$17,500
48.24
48.25
over $17,500,000 to $19,999,999
but not over $20,000,000
$20,000
48.26
48.27
over $20,000,000 to $22,499,999
but not over $22,500,000
$22,500
48.28
48.29
over $22,500,000 to $24,999,999
but not over $25,000,000
$25,000
48.30
48.31
over $25,000,000 to $27,499,999
but not over $27,500,000
$27,500
48.32
48.33
over $27,500,000 to $29,999,999
but not over $30,000,000
$30,000
48.34
48.35
over $30,000,000 to $39,999,999
but not over $40,000,000
$50,000
48.36
over $40,000,000 and over
$75,000
48.37EFFECTIVE DATE.This section is effective July 1, 2014, and applies to aircraft
48.38tax due on or after that date.

48.39    Sec. 21. Laws 1980, chapter 511, section 1, subdivision 2, as amended by Laws 1991,
48.40chapter 291, article 8, section 22, Laws 1998, chapter 389, article 8, section 25, Laws
48.412003, First Special Session chapter 21, article 8, section 11, and Laws 2008, chapter
48.42154, article 5, section 2, is amended to read:
49.1    Subd. 2. (a) Notwithstanding Minnesota Statutes, section 477A.016, or any
49.2other law, ordinance, or city charter provision to the contrary, the city of Duluth may,
49.3by ordinance, impose an additional sales tax of up to two and one-quarter one and
49.4three-quarter percent on sales transactions which are described in Minnesota Statutes 2000,
49.5section 297A.01, subdivision 3, clause (c). When the city council determines that the taxes
49.6imposed under this subdivision and under Laws 1998, chapter 389, article 8, section 26, at a
49.7rate of one-half of one percent have produced revenue sufficient to pay (1) the debt service
49.8on bonds in a principal amount of $8,000,000 issued for capital improvements to the
49.9Duluth Entertainment and Convention Center, and (2) debt service on outstanding bonds
49.10originally issued in the principal amount of $4,970,000 to finance capital improvements to
49.11the Great Lakes Aquarium since the imposition of the taxes at the rate of one and one-half
49.12percent, the rate of the tax under this subdivision is reduced by one-half of one percent.
49.13 The imposition of this tax shall not be subject to voter referendum under either state law
49.14or city charter provisions. When the city council determines that the taxes imposed under
49.15this subdivision paragraph at a rate of three-quarters of one percent and other sources of
49.16revenue produce revenue sufficient to pay debt service on bonds in the principal amount
49.17of $40,285,000 plus issuance and discount costs, issued for capital improvements at the
49.18Duluth Entertainment and Convention Center, which include a new arena, the rate of tax
49.19under this subdivision must be reduced by three-quarters of one percent.
49.20(b) In addition to the tax in paragraph (a) and notwithstanding Minnesota Statutes,
49.21section 477A.016, or any other law, ordinance, or city charter provision to the contrary,
49.22the city of Duluth may, by ordinance, impose an additional sales tax of up to one-half of
49.23one percent on sales transactions which are described in Minnesota Statutes 2000, section
49.24297A.01, subdivision 3, clause (c). This tax expires when the city council determines
49.25that the tax imposed under this paragraph, along with the tax imposed under section
49.2622, paragraph (b), has produced revenues sufficient to pay the debt service on bonds
49.27in a principal amount of no more than $18,000,000, plus issuance and discount costs,
49.28to finance capital improvements to public facilities to support tourism and recreational
49.29activities in that portion of the city west of 34th Avenue West.
49.30(c) The city of Duluth may sell and issue up to $18,000,000 in general obligation
49.31bonds under Minnesota Statutes, chapter 475, plus an additional amount to pay for the
49.32costs of issuance and any premiums. The proceeds may be used to finance capital
49.33improvements to public facilities that support tourism and recreational activities in the
49.34portion of the city west of 34th Avenue West, as described in paragraph (b). The issuance
49.35of the bonds is subject to the provisions of Minnesota Statutes, chapter 475, except no
49.36election shall be required unless required by the city charter. The bonds shall not be
50.1included in computing net debt. The revenues from the taxes that the city of Duluth may
50.2impose under paragraph (b) and under section 22, paragraph (b), may be pledged to pay
50.3principal of and interest on such bonds.
50.4EFFECTIVE DATE.This section is effective the day after the governing body of
50.5the city of Duluth and its chief clerical officer comply with Minnesota Statutes, section
50.6645.021, subdivisions 2 and 3.

50.7    Sec. 22. Laws 1980, chapter 511, section 2, as amended by Laws 1998, chapter 389,
50.8article 8, section 26, and Laws 2003, First Special Session chapter 21, article 8, section
50.912, is amended to read:
50.10    Sec. 22. CITY OF DULUTH; TAX ON RECEIPTS BY HOTELS AND
50.11MOTELS.
50.12    (a) Notwithstanding Minnesota Statutes, section 477A.016, or any other law, or
50.13ordinance, or city charter provision to the contrary, the city of Duluth may, by ordinance,
50.14impose an additional tax of one and one-half percent upon the gross receipts from the
50.15sale of lodging for periods of less than 30 days in hotels and motels located in the city.
50.16When the city council determines that the taxes imposed under this section and section 25
50.17at a rate of one-half of one percent have produced revenue sufficient to pay (1) the debt
50.18service on bonds in a principal amount of $8,000,000 issued for capital improvements
50.19for the Duluth Entertainment and Convention Center, and (2) the debt service on
50.20outstanding bonds originally issued in the principal amount of $4,970,000 to finance
50.21capital improvements to the Great Lakes Aquarium since the imposition of the taxes at the
50.22rate of one and one-half percent, the rate of the tax under this section is reduced to one
50.23percent. The tax shall be collected in the same manner as the tax set forth in the Duluth
50.24city charter, section 54(d), paragraph one. The imposition of this tax shall not be subject to
50.25voter referendum under either state law or city charter provisions.
50.26(b) In addition to the tax in paragraph (a) and notwithstanding Minnesota Statutes,
50.27section 477A.016, or any other law, ordinance, or city charter provision to the contrary,
50.28the city of Duluth may, by ordinance, impose an additional sales tax of up to one-half
50.29of one percent on the gross receipts from the sale of lodging for periods of less than
50.3030 days in hotels and motels located in the city. This tax expires when the city council
50.31first determines that the tax imposed under this paragraph, along with the tax imposed
50.32under section 21, paragraph (b), has produced revenues sufficient to pay the debt
50.33service on bonds in a principal amount of no more than $18,000,000, plus issuance and
50.34discount costs, to finance capital improvements to public facilities to support tourism and
50.35recreational activities in that portion of the city west of 34th Avenue West.
51.1EFFECTIVE DATE.This section is effective the day after the governing body of
51.2the city of Duluth and its chief clerical officer comply with Minnesota Statutes, section
51.3645.021, subdivisions 2 and 3.

51.4    Sec. 23. Laws 2005, First Special Session chapter 3, article 5, section 38, subdivision
51.54, is amended to read:
51.6    Subd. 4. Termination of taxes. The taxes imposed under this section expire at the
51.7earlier of (1) ten 15 years after the taxes are first imposed, or (2) when the city council first
51.8determines that the amount of revenues raised to pay for the projects under subdivision 2,
51.9shall meet or exceed the sum of $15,000,000. Any funds remaining after completion of
51.10the projects may be placed in the general fund of the city.
51.11EFFECTIVE DATE.This section is effective the day after the governing body of
51.12the city of Albert Lea and its chief clerical officer comply with Minnesota Statutes, section
51.13645.021, subdivisions 2 and 3.

51.14    Sec. 24. Laws 2006, chapter 259, article 3, section 10, subdivision 3, is amended to read:
51.15    Subd. 3. Use of revenues. (a) Revenues received from the taxes authorized by
51.16subdivisions 1 and 2 must be used to pay the cost of collecting and administering the tax
51.17and to finance the acquisition and betterment of water and wastewater facilities to serve the
51.18cities of Brainerd and Baxter, building and equipping a fire substation, as approved by the
51.19voters at the referendum authorizing the tax. Authorized costs include, but are not limited
51.20to, acquiring property and paying construction and engineering costs related to the projects.
51.21(b) In addition to the projects authorized in paragraph (a), the city of Baxter may, if
51.22approved by the voters at an election under subdivision 5, paragraph (b), allocate up to an
51.23additional $40,000,000 of the revenues received from the taxes authorized by subdivisions
51.241 and 2 to a capital infrastructure fund. Money from this fund may only be used to
51.25finance (1) sanitary sewer, storm sewer, and water projects, (2) transportation safety
51.26improvements, and (3) improvements to the Brainerd Lakes Area Airport.
51.27EFFECTIVE DATE.This section is effective the day after the governing body of
51.28the city of Baxter and its chief clerical officer comply with Minnesota Statutes, section
51.29645.021, subdivisions 2 and 3.

51.30    Sec. 25. Laws 2006, chapter 259, article 3, section 10, subdivision 4, is amended to read:
51.31    Subd. 4. Bonds. (a) The city of Baxter, pursuant to the approval of the voters at the
51.32November 2, 2004, referendum authorizing the imposition of the taxes in this section, may
52.1issue general obligation bonds of the city, in one or more series, in the aggregate principal
52.2amount not to exceed $15,000,000 to finance the projects listed in subdivision 3, paragraph
52.3(a). The debt represented by the bonds is not included in computing any debt limitations
52.4applicable to the city, and the levy of taxes required by Minnesota Statutes, section 475.61,
52.5to pay the principal of and interest on the bonds is not subject to any levy limitation or
52.6included in computing or applying any levy limitation applicable to the city of Baxter.
52.7(b) The city of Baxter, pursuant to the approval of the voters at the 2014 general
52.8election to extend the tax under this section, may issue general obligation bonds of the city,
52.9in one or more series, in the aggregate principal amount not to exceed (1) $32,000,000
52.10plus an amount equal to the costs of issuance of the bonds to finance the projects listed
52.11in subdivision 3, paragraph (b), clauses (1) and (2), and (2) $8,000,000 plus an amount
52.12equal to the costs of the issuance of the bonds to finance the project listed in subdivision 3,
52.13paragraph (b), clause (3). The debt represented by the bonds is not included in computing
52.14any debt limitations applicable to the city, and the levy of taxes required by Minnesota
52.15Statutes, section 475.61, to pay the principal of and interest on the bonds is not subject to
52.16any levy limitation or included in computing or applying any levy limitation applicable to
52.17the city of Baxter.
52.18EFFECTIVE DATE.This section is effective the day following final enactment.

52.19    Sec. 26. Laws 2006, chapter 259, article 3, section 10, subdivision 5, is amended to read:
52.20    Subd. 5. Termination of taxes. (a) The taxes imposed under subdivisions 1 and 2
52.21expire at the earlier of a date 12 years after the imposition of the tax or when the Baxter
52.22City Council first determines that the amount of revenues raised from the taxes to pay for
52.23the projects under subdivision 3 equals or exceeds $15,000,000 plus any interest on bonds
52.24issued for the projects under subdivision 4, paragraph (a). Any funds remaining after the
52.25expiration of the taxes and retirement of the bonds shall be placed in a capital project fund
52.26of the city of Baxter. The taxes imposed under subdivisions 1 and 2 may expire at an
52.27earlier time if the city of Baxter so determines by ordinance.
52.28(b) Notwithstanding Minnesota Statutes, sections 297A.99 and 477A.016, or any
52.29other contrary provision of law, ordinance, or city charter, the city of Baxter may, by
52.30ordinance, extend the taxes authorized under subdivisions 1 and 2 beyond the termination
52.31date in paragraph (a) if approved by the voters of the city at a general election held
52.32in 2014. The question put to the voters must indicate that an affirmative vote would
52.33extend the imposition of the taxes through 2037 or until an additional $40,000,000,
52.34plus an amount equal to interest and issuance costs associated with bonds issued under
52.35subdivision 4, paragraph (b), above the initial amount authorized to pay for $15,000,000
53.1in bonds and associated bond cost and projects, listed in subdivision 3, paragraph (a), is
53.2raised. If extended under this paragraph, the taxes authorized in subdivisions 1 and 2 will
53.3terminate at the earlier of (1) when an additional $40,000,000, plus an amount equal to
53.4interest and issuance costs associated with bonds issued under subdivision 4, paragraph
53.5(b), above the amount authorized under paragraph (a), is raised, or (2) December 31, 2037.
53.6EFFECTIVE DATE.This section is effective the day after the governing body of
53.7the city of Baxter and its chief clerical officer comply with Minnesota Statutes, section
53.8645.021, subdivisions 2 and 3.

53.9    Sec. 27. Laws 2006, chapter 259, article 3, section 11, subdivision 3, is amended to read:
53.10    Subd. 3. Use of revenues. (a) Revenues received from the taxes authorized by
53.11subdivisions 1 and 2 must be used to pay the cost of collecting and administering the tax
53.12and to finance all or part of the costs of constructing upgraded water and wastewater
53.13treatment facilities to serve the cities of Brainerd and Baxter, water infrastructure
53.14improvements, and trail development, contingent on approval by Brainerd voters at the
53.15November 7, 2006, referendum. Authorized costs include, but are not limited to, acquiring
53.16property and paying construction and engineering costs related to the projects.
53.17(b) In addition to the projects authorized in paragraph (a), the city of Brainerd may,
53.18if approved by the voters at an election under subdivision 5, paragraph (b), spend up to an
53.19additional $15,000,000 from revenues raised from the taxes authorized in subdivisions 1
53.20and 2 on the following projects:
53.21(1) an upgraded waste treatment facility jointly serving the cities of Brainerd and
53.22Baxter;
53.23(2) with any funds not needed for the project in clause (1), water infrastructure
53.24improvements; and
53.25(3) with any funds not needed for the projects in clauses (1) and (2), trail
53.26improvements.
53.27EFFECTIVE DATE.This section is effective the day after the governing body of
53.28the city of Brainerd and its chief clerical officer comply with Minnesota Statutes, section
53.29645.021, subdivisions 2 and 3.

53.30    Sec. 28. Laws 2006, chapter 259, article 3, section 11, subdivision 4, is amended to read:
53.31    Subd. 4. Bonds. The city of Brainerd, contingent on approval of the voters at
53.32the November 7, 2006, referendum authorizing the imposition of taxes in this section,
53.33may issue general obligation bonds of the city, in one or more series, in the aggregate
54.1principal amount not to exceed $22,030,000 to finance the projects listed in subdivision 3,
54.2paragraph (a). The debt represented by the bonds is not included in computing any debt
54.3limitations applicable to Brainerd, and the levy of taxes required by Minnesota Statutes,
54.4section 475.61, to pay the principal and interest on the bonds is not subject to any levy
54.5limitation or included in computing any levy limitation applicable to the city of Brainerd.
54.6EFFECTIVE DATE.This section is effective the day following final enactment.

54.7    Sec. 29. Laws 2006, chapter 259, article 3, section 11, subdivision 5, is amended to read:
54.8    Subd. 5. Termination of taxes. (a) The taxes imposed under subdivisions 1 and
54.92 expire at the earlier of a date 12 years after the imposition of the tax or when the city
54.10council first determines that the amount of revenues raised from the taxes to pay for
54.11projects under subdivision 3 equals or exceeds $22,030,000 plus any interest on bonds
54.12issued for the projects under subdivision 4. Any funds remaining after the expiration of
54.13the taxes and retirement of the bonds shall be placed in a capital project fund of the city of
54.14Brainerd. The taxes imposed under subdivision 1 and 2 may expire at an earlier time if the
54.15city of Brainerd so determines by ordinance.
54.16(b) Notwithstanding Minnesota Statutes, sections 297A.99 and 477A.016, or any
54.17other contrary provision of law, ordinance, or city charter, the city of Brainerd may, by
54.18ordinance, extend the taxes authorized under subdivisions 1 and 2 beyond the termination
54.19date in paragraph (a) if approved by the voters of the city at a general election held in 2014.
54.20The question put to the voters must indicate that an affirmative vote would extend the
54.21imposition of the taxes for an additional 18 years or until an additional $15,000,000 above
54.22the initial amount authorized to pay for $22,030,000 in bonds is raised. If extended under
54.23this paragraph, the taxes authorized in subdivisions 1 and 2 will terminate at the earlier of
54.24(1) when an additional $15,000,000 above the amount authorized under paragraph (a) is
54.25raised, or (2) 18 years after the taxes would have expired under paragraph (a).
54.26EFFECTIVE DATE.This section is effective the day after the governing body of
54.27the city of Brainerd and its chief clerical officer comply with Minnesota Statutes, section
54.28645.021, subdivisions 2 and 3.

54.29    Sec. 30. Laws 2013, chapter 143, article 8, section 22, the effective date, is amended to
54.30read:
54.31EFFECTIVE DATE.This section is effective for sales and purchases made after
54.32June 30, 2013. Subdivision 7, paragraph (c), clause (2), is effective for sales and purchases
54.33made after June 30, 2013. The provisions of subdivision 7, paragraph (b), and paragraph
55.1(c), clause (8), are effective retroactively for sales and purchases made after April 1,
55.22009. Any vendor who paid sales or use tax on items now exempt under subdivision 7,
55.3paragraph (b), and paragraph (c), clause (8), that were sold after April 1, 2009, and before
55.4July 1, 2013, may apply for a refund of the sales or use tax paid in the manner provided
55.5in Minnesota Statutes, section 289A.50, subdivision 1, but only if the vendor did not
55.6collect and remit sales tax on the items for which a refund is claimed. Interest on the
55.7refund shall be paid at the rate in Minnesota Statutes, section 270C.405, from 90 days
55.8after the refund claim is filed with the commissioner of revenue. The amount to make the
55.9refunds is annually appropriated to the commissioner of revenue from the general fund.
55.10Notwithstanding limitations on claims for refunds under Minnesota Statutes, section
55.11289A.40, claims may be filed with the commissioner until June 30, 2015.
55.12EFFECTIVE DATE.This section is effective the day following final enactment.

55.13    Sec. 31. Laws 2013, chapter 143, article 8, section 23, the effective date, is amended to
55.14read:
55.15EFFECTIVE DATE.This section is effective for sales and purchases made after
55.16June 30, 2013. This section is effective for sales and purchases made after June 30, 2013,
55.17except that the provision regarding accessories and supplies purchased in a transaction
55.18covered by Medicare or Medicaid that are not already exempt under Minnesota Statutes,
55.19section 297A.67, subdivision 7, and the provision defining "Medicare" and "Medicaid"
55.20are effective retroactively for sales and purchases made after April 1, 2009. Any vendor
55.21who paid sales or use tax on accessories and supplies purchased in a transaction covered
55.22by Medicare or Medicaid that are not already exempt under Minnesota Statutes, section
55.23297A.67, subdivision 7, and that were sold after April 1, 2009, and before July 1, 2013,
55.24may apply for a refund of the sales or use tax paid in the manner provided in Minnesota
55.25Statutes, section 289A.50, subdivision 1, but only if the vendor did not collect and remit
55.26sales tax on the accessories and supplies for which a refund is claimed. Interest on the
55.27refund shall be paid at the rate in Minnesota Statutes, section 270C.405, from 90 days
55.28after the refund claim is filed with the commissioner of revenue. The amount to make the
55.29refunds is annually appropriated to the commissioner of revenue from the general fund.
55.30Notwithstanding limitations on claims for refunds under Minnesota Statutes, section
55.31289A.40, claims may be filed with the commissioner until June 30, 2015.
55.32EFFECTIVE DATE.This section is effective the day following final enactment.

56.1    Sec. 32. Laws 2013, chapter 143, article 8, section 27, the effective date, is amended to
56.2read:
56.3EFFECTIVE DATE.For the purpose of qualifying under paragraphs (c) and (d),
56.4this section is effective retroactively for sales and purchases made after June 30, 2013
56.5 2012. For the purpose of determining eligibility for the exemptions provided in this
56.6section, this section is effective for sales and purchases of computer software maintenance
56.7agreements made after June 30, 2013, and for sales and purchases for either a "qualified
56.8refurbished data center" or a "qualified data center" made after June 30, 2013, except that
56.9if the data center qualifies as a "qualified data center" as defined in Laws 2011, First
56.10Special Session chapter 7, article 3, section 7, then the exemptions provided in this section,
56.11other than for computer software maintenance agreements, continue to be effective for
56.12sales and purchases made after June 30, 2012.
56.13EFFECTIVE DATE.This section is effective the day following final enactment.

56.14    Sec. 33. Laws 2013, chapter 143, article 8, section 37, the effective date, is amended to
56.15read:
56.16EFFECTIVE DATE.This section is effective retroactively to capital investments
56.17made and jobs created after December 31, 2012, and effective retroactively for sales and
56.18purchases made after December 31, 2012, and before July 1, 2019. Applications for
56.19refunds on purchases exempt under this section must not be filed before June 30, 2015.
56.20EFFECTIVE DATE.This section is effective the day following final enactment.

56.21    Sec. 34. CITY OF PROCTOR; LOCAL TAXES AUTHORIZED.
56.22    Subdivision 1. Food and beverage tax authorized. Notwithstanding Minnesota
56.23Statutes, section 297A.99 or 477A.016, or any ordinance, city charter, or other provision
56.24of law, the city of Proctor may, by ordinance, impose a sales tax of up to one percent on
56.25the gross receipts of all food and beverages sold by a restaurant or place of refreshment,
56.26as defined by resolution of the city, that is located within the city. For purposes of this
56.27section, "food and beverages" include retail on-sale of intoxicating liquor and fermented
56.28malt beverages.
56.29    Subd. 2. Use of proceeds from authorized taxes. The proceeds of the taxes
56.30imposed under subdivision 1 must be used by the city to fund: (1) construction and
56.31improvement of walking and bicycle trails; (2) a multiuse civic center facility and parking
57.1improvements; and (3) improvements related to the redevelopment and realignment of a
57.2road through the fairgrounds property ceded to the city of Proctor by the city of Duluth.
57.3    Subd. 3. Collection, administration, and enforcement. The city may enter into
57.4an agreement with the commissioner of revenue to administer, collect, and enforce the
57.5taxes under subdivision 1. If the commissioner agrees to collect the tax, the provisions
57.6of Minnesota Statutes, section 297A.99, related to collection, administration, and
57.7enforcement, and Minnesota Statutes, section 270C.171, apply.
57.8EFFECTIVE DATE.This section is effective the day after the governing body of
57.9the city of Proctor and its chief clerical officer comply with Minnesota Statutes, section
57.10645.021, subdivisions 2 and 3.

57.11    Sec. 35. DONATED MATERIALS FOR A LIBRARY EXPANSION.
57.12Building materials and supplies purchased and donated by a private entity and
57.13used in the construction of an addition to a city library facility occurring before July 1,
57.142015, are exempt.
57.15EFFECTIVE DATE.This section is effective for materials and supplies used in the
57.16construction of the addition between April 1, 2014, and July 1, 2015.

57.17    Sec. 36. VALIDATION OF PRIOR ACT; AUTHORIZATION.
57.18Notwithstanding the time limits in Minnesota Statutes, section 645.021, the city of
57.19Albert Lea may approve Laws 2005, First Special Session chapter 3, article 5, section 38,
57.20as amended by Laws 2006, chapter 259, article 3, section 6, and file its approval with the
57.21secretary of state by June 15, 2014. If approved as authorized under this section, actions
57.22undertaken by the city pursuant to the approval of the voters on November 8, 2005, and
57.23otherwise in accordance with Laws 2005, First Special Session chapter 3, article 5, section
57.2438, as amended by Laws 2006, chapter 259, article 3, section 6, are validated.
57.25EFFECTIVE DATE.This section is effective the day following final enactment.

57.26    Sec. 37. SALES TO INSTRUMENTALITIES OF THE STATES.
57.27Sales of the following items to an organization defined by the Internal Revenue
57.28Service as an instrumentality of each, and all, of the states relating to the holding of an
57.29annual meeting in this state are exempt:
57.30(1) prepared food, soft drinks, and candy, as defined in Minnesota Statutes, section
57.31297A.61, subdivisions 31 to 33; and
58.1(2) alcoholic beverages, as defined in Minnesota Statutes, section 297A.67,
58.2subdivision 2.
58.3EFFECTIVE DATE.This section is applicable to sales and purchases made after
58.4June 30, 2014, and before January 1, 2015.

58.5    Sec. 38. VOLUNTARY COMPLIANCE PROGRAM; ANIMAL SHELTERS.
58.6(a) Any Minnesota nonprofit organization that is primarily engaged in the business
58.7of rescuing, sheltering, and finding homes for unwanted animals, for periods prior to the
58.8organization registering to collect and remit sales and use tax under Minnesota Statutes,
58.9chapter 297A, shall not be liable for any state or local uncollected and unpaid sales and use
58.10tax, penalties, or interest incurred in providing animal rescue, shelter, and home placement
58.11services, if the nonprofit organization registers through the voluntary compliance program
58.12to collect and remit sales and use tax under Minnesota Statutes, chapter 297A, before
58.13January 1, 2015.
58.14(b) The voluntary compliance program under paragraph (a) also applies to
58.15organizations described in paragraph (a) that received notice of the commencement of an
58.16audit prior to registering to collect and remit sales and use tax under Minnesota Statutes,
58.17chapter 297A, as long as the audit is not finally resolved and the organization registers
58.18before January 1, 2015. Paragraph (a) shall not apply to sales and use taxes already paid or
58.19remitted to the state or to sales taxes already collected by the organization.
58.20EFFECTIVE DATE.This section is effective the day following final enactment.

58.21ARTICLE 4
58.22INCOME AND ESTATE TAXES

58.23    Section 1. Minnesota Statutes 2013 Supplement, section 116J.8737, subdivision 2, as
58.24amended by Laws 2014, chapter 150, article 1, section 2, is amended to read:
58.25    Subd. 2. Certification of qualified small businesses. (a) Businesses may apply
58.26to the commissioner for certification as a qualified small business or qualified greater
58.27Minnesota small business for a calendar year. The application must be in the form
58.28and be made under the procedures specified by the commissioner, accompanied by an
58.29application fee of $150. Application fees are deposited in the small business investment
58.30tax credit administration account in the special revenue fund. The application for
58.31certification for 2010 must be made available on the department's Web site by August 1,
58.322010. Applications for subsequent years' certification must be made available on the
58.33department's Web site by November 1 of the preceding year.
59.1(b) Within 30 days of receiving an application for certification under this subdivision,
59.2the commissioner must either certify the business as satisfying the conditions required
59.3of a qualified small business or qualified greater Minnesota small business, request
59.4additional information from the business, or reject the application for certification. If
59.5the commissioner requests additional information from the business, the commissioner
59.6must either certify the business or reject the application within 30 days of receiving the
59.7additional information. If the commissioner neither certifies the business nor rejects
59.8the application within 30 days of receiving the original application or within 30 days of
59.9receiving the additional information requested, whichever is later, then the application is
59.10deemed rejected, and the commissioner must refund the $150 application fee. A business
59.11that applies for certification and is rejected may reapply.
59.12(c) To receive certification as a qualified small business, a business must satisfy
59.13all of the following conditions:
59.14(1) the business has its headquarters in Minnesota;
59.15(2) at least 51 percent of the business's employees are employed in Minnesota, and
59.1651 percent of the business's total payroll is paid or incurred in the state;
59.17(3) the business is engaged in, or is committed to engage in, innovation in Minnesota
59.18in one of the following as its primary business activity:
59.19(i) using proprietary technology to add value to a product, process, or service in a
59.20qualified high-technology field;
59.21(ii) researching or developing a proprietary product, process, or service in a qualified
59.22high-technology field; or
59.23(iii) researching or developing a proprietary product, process, or service in the fields
59.24of agriculture, tourism, forestry, mining, manufacturing, or transportation; or
59.25(iii) (iv) researching, developing, or producing a new proprietary technology for use
59.26in the fields of agriculture, tourism, forestry, mining, manufacturing, or transportation;
59.27(4) other than the activities specifically listed in clause (3), the business is not
59.28engaged in real estate development, insurance, banking, lending, lobbying, political
59.29consulting, information technology consulting, wholesale or retail trade, leisure,
59.30hospitality, transportation, construction, ethanol production from corn, or professional
59.31services provided by attorneys, accountants, business consultants, physicians, or health
59.32care consultants;
59.33(5) the business has fewer than 25 employees;
59.34(6) the business must pay its employees annual wages of at least 175 percent of the
59.35federal poverty guideline for the year for a family of four and must pay its interns annual
59.36wages of at least 175 percent of the federal minimum wage used for federally covered
60.1employers, except that this requirement must be reduced proportionately for employees
60.2and interns who work less than full-time, and does not apply to an executive, officer, or
60.3member of the board of the business, or to any employee who owns, controls, or holds
60.4power to vote more than 20 percent of the outstanding securities of the business;
60.5(7) the business has (i) not been in operation for more than ten years, or (ii) not
60.6been in operation for more than 20 years if the business is engaged in the research,
60.7development, or production of medical devices or pharmaceuticals for which United
60.8States Food and Drug Administration approval is required for use in the treatment or
60.9diagnosis of a disease or condition;
60.10(8) the business has not previously received private equity investments of more
60.11than $4,000,000;
60.12    (9) the business is not an entity disqualified under section 80A.50, paragraph (b),
60.13clause (3); and
60.14(10) the business has not issued securities that are traded on a public exchange.
60.15(d) In applying the limit under paragraph (c), clause (5), the employees in all members
60.16of the unitary business, as defined in section 290.17, subdivision 4, must be included.
60.17(e) In order for a qualified investment in a business to be eligible for tax credits:
60.18(1) the business must have applied for and received certification for the calendar
60.19year in which the investment was made prior to the date on which the qualified investment
60.20was made;
60.21(2) the business must not have issued securities that are traded on a public exchange;
60.22(3) the business must not issue securities that are traded on a public exchange within
60.23180 days after the date on which the qualified investment was made; and
60.24(4) the business must not have a liquidation event within 180 days after the date on
60.25which the qualified investment was made.
60.26(f) The commissioner must maintain a list of qualified small businesses and qualified
60.27greater Minnesota businesses certified under this subdivision for the calendar year and
60.28make the list accessible to the public on the department's Web site.
60.29(g) For purposes of this subdivision, the following terms have the meanings given:
60.30(1) "qualified high-technology field" includes aerospace, agricultural processing,
60.31renewable energy, energy efficiency and conservation, environmental engineering, food
60.32technology, cellulosic ethanol, information technology, materials science technology,
60.33nanotechnology, telecommunications, biotechnology, medical device products,
60.34pharmaceuticals, diagnostics, biologicals, chemistry, veterinary science, and similar fields;
61.1(2) "proprietary technology" means the technical innovations that are unique and
61.2legally owned or licensed by a business and includes, without limitation, those innovations
61.3that are patented, patent pending, a subject of trade secrets, or copyrighted; and
61.4(3) "greater Minnesota" means the area of Minnesota located outside of the
61.5metropolitan area as defined in section 473.121, subdivision 2.
61.6(h) To receive certification as a qualified greater Minnesota business, a business must
61.7satisfy all of the requirements of paragraph (c) and must satisfy the following conditions:
61.8(1) the business has its headquarters in greater Minnesota; and
61.9(2) at least 51 percent of the business's employees are employed in greater Minnesota,
61.10and 51 percent of the business's total payroll is paid or incurred in greater Minnesota.
61.11EFFECTIVE DATE.This section is effective for taxable years beginning after
61.12December 31, 2013.

61.13    Sec. 2. Minnesota Statutes 2012, section 116J.8737, subdivision 5, as amended by
61.14Laws 2014, chapter 150, article 1, section 3, is amended to read:
61.15    Subd. 5. Credit allowed. (a) (1) A qualified investor or qualified fund is eligible
61.16for a credit equal to 25 percent of the qualified investment in a qualified small business.
61.17Investments made by a pass-through entity qualify for a credit only if the entity is a
61.18qualified fund. The commissioner must not allocate more than $15,000,000
61.19$15,000,000 in credits to qualified investors or qualified funds for taxable years
61.20beginning after December 31, 2013, and before January 1, 2017; and
61.21(2) for taxable years beginning after December 31, 2014, and before January 1,
61.222017, $7,500,000 must be allocated to credits for qualifying investments in qualified
61.23greater Minnesota businesses and minority- or women-owned qualified small businesses
61.24in Minnesota. Any portion of a taxable year's credits that is reserved for qualifying
61.25investments in greater Minnesota businesses and minority- or women-owned qualified
61.26small businesses in Minnesota that is not allocated by September 30 of the taxable year is
61.27available for allocation to other credit applications beginning on October 1. Any portion
61.28of a taxable year's credits that is not allocated by the commissioner does not cancel and
61.29may be carried forward to subsequent taxable years until all credits have been allocated.
61.30(b) The commissioner may not allocate more than a total maximum amount in credits
61.31for a taxable year to a qualified investor for the investor's cumulative qualified investments
61.32as an individual qualified investor and as an investor in a qualified fund; for married
61.33couples filing joint returns the maximum is $250,000, and for all other filers the maximum
61.34is $125,000. The commissioner may not allocate more than a total of $1,000,000 in credits
61.35over all taxable years for qualified investments in any one qualified small business.
62.1(c) The commissioner may not allocate a credit to a qualified investor either as
62.2an individual qualified investor or as an investor in a qualified fund if, at the time the
62.3investment is proposed:
62.4(1) the investor is an officer or principal of the qualified small business; or
62.5(2) the investor, either individually or in combination with one or more members of
62.6the investor's family, owns, controls, or holds the power to vote 20 percent or more of
62.7the outstanding securities of the qualified small business.
62.8A member of the family of an individual disqualified by this paragraph is not eligible for a
62.9credit under this section. For a married couple filing a joint return, the limitations in this
62.10paragraph apply collectively to the investor and spouse. For purposes of determining the
62.11ownership interest of an investor under this paragraph, the rules under section 267(c) and
62.12267(e) of the Internal Revenue Code apply.
62.13(d) Applications for tax credits for 2010 must be made available on the department's
62.14Web site by September 1, 2010, and the department must begin accepting applications
62.15by September 1, 2010. Applications for subsequent years must be made available by
62.16November 1 of the preceding year.
62.17(e) Qualified investors and qualified funds must apply to the commissioner for tax
62.18credits. Tax credits must be allocated to qualified investors or qualified funds in the order
62.19that the tax credit request applications are filed with the department. The commissioner
62.20must approve or reject tax credit request applications within 15 days of receiving the
62.21application. The commissioner must allocate credits to approved applications if credits
62.22remain available. The investment specified in the application must be made within 60 days
62.23of the allocation of the credits. If the investment is not made within 60 days, the credit
62.24allocation is canceled and available for reallocation. A qualified investor or qualified fund
62.25that fails to invest as specified in the application, within 60 days of allocation of the
62.26credits, must notify the commissioner of the failure to invest within five business days of
62.27the expiration of the 60-day investment period. Credit applications that were approved but
62.28that did not receive an allocation of credits at the time of approval because the aggregate
62.29limit of credits for the year was exhausted remain eligible for allocation of credits if
62.30additional credits become available due to cancellations under this paragraph or due to
62.31termination of the time period for credits reserved for investment in qualified greater
62.32Minnesota businesses and minority- and women-owned small businesses under paragraph
62.33(a). Approved credit applications that do not receive credit allocations in the tax year must
62.34be resubmitted to be eligible for credit allocations in the following tax year.
62.35(f) All tax credit request applications filed with the department on the same day must
62.36be treated as having been filed contemporaneously. If two or more qualified investors or
63.1qualified funds file tax credit request applications on the same day, and the aggregate
63.2amount of credit allocation claims exceeds the aggregate limit of credits under this section
63.3or the lesser amount of credits that remain unallocated on that day, then the credits must
63.4be allocated among the qualified investors or qualified funds who filed on that day on a
63.5pro rata basis with respect to the amounts claimed. The pro rata allocation for any one
63.6qualified investor or qualified fund is the product obtained by multiplying a fraction,
63.7the numerator of which is the amount of the credit allocation claim filed on behalf of
63.8a qualified investor and the denominator of which is the total of all credit allocation
63.9claims filed on behalf of all applicants on that day, by the amount of credits that remain
63.10unallocated on that day for the taxable year.
63.11(g) A qualified investor or qualified fund, or a qualified small business acting on their
63.12behalf, must notify the commissioner when an investment for which credits were allocated
63.13has been made, and the taxable year in which the investment was made. A qualified fund
63.14must also provide the commissioner with a statement indicating the amount invested by
63.15each investor in the qualified fund based on each investor's share of the assets of the
63.16qualified fund at the time of the qualified investment. After receiving notification that the
63.17investment was made, the commissioner must issue credit certificates for the taxable year
63.18in which the investment was made to the qualified investor or, for an investment made by
63.19a qualified fund, to each qualified investor who is an investor in the fund. The certificate
63.20must state that the credit is subject to revocation if the qualified investor or qualified
63.21fund does not hold the investment in the qualified small business for at least three years,
63.22consisting of the calendar year in which the investment was made and the two following
63.23years. The three-year holding period does not apply if:
63.24(1) the investment by the qualified investor or qualified fund becomes worthless
63.25before the end of the three-year period;
63.26(2) 80 percent or more of the assets of the qualified small business is sold before
63.27the end of the three-year period;
63.28(3) the qualified small business is sold before the end of the three-year period;
63.29(4) the qualified small business's common stock begins trading on a public exchange
63.30before the end of the three-year period; or
63.31    (5) the qualified investor dies before the end of the three-year period.
63.32(h) The commissioner must notify the commissioner of revenue of credit certificates
63.33issued under this section.
63.34EFFECTIVE DATE.This section is effective the day following final enactment.

64.1    Sec. 3. Minnesota Statutes 2012, section 116J.8737, is amended by adding a
64.2subdivision to read:
64.3    Subd. 5a. Promotion of credit in greater Minnesota. (a) By July 1, 2014,
64.4the commissioner shall develop a plan to increase awareness of and use of the credit
64.5for investments in qualified greater Minnesota businesses and minority-owned and
64.6women-owned qualified small businesses with the goal that the portion of the credit
64.7reserved for investments in qualified greater Minnesota businesses and minority-owned
64.8and women-owned qualified small businesses is allocated in full to those investments.
64.9(b) Beginning with the legislative report due on March 15, 2015, under subdivision
64.109, the commissioner shall report on its plan under this subdivision and the results achieved.
64.11EFFECTIVE DATE.This section is effective the day following final enactment.

64.12    Sec. 4. Minnesota Statutes 2013 Supplement, section 136A.129, subdivision 1, is
64.13amended to read:
64.14    Subdivision 1. Definitions. (a) For the purposes of this section, the terms defined in
64.15this subdivision have the meanings given to them.
64.16(b) "Eligible employer" means a taxpayer under section 290.01 with employees
64.17located in greater Minnesota.
64.18(c) "Eligible institution" means a Minnesota public postsecondary institution or
64.19a Minnesota private, nonprofit, baccalaureate, or graduate degree-granting college or
64.20university.
64.21(d) "Eligible student" means a student enrolled in an eligible institution who has
64.22completed one-half of the credits necessary for the respective degree or certification,
64.23including a graduate degree.
64.24(e) "Greater Minnesota" means the area of the state outside of the counties of Anoka,
64.25Carver, Chisago, Dakota, Hennepin, Isanti, Ramsey, Scott, Sherburne, Washington, and
64.26Wright.
64.27EFFECTIVE DATE.This section is effective the day following final enactment.

64.28    Sec. 5. Minnesota Statutes 2013 Supplement, section 136A.129, subdivision 3, is
64.29amended to read:
64.30    Subd. 3. Program components. (a) An intern must be an eligible student who has
64.31been admitted to a major program that is related to the intern experience as determined
64.32by the eligible institution.
64.33(b) To participate in the program, an eligible institution must:
65.1(1) enter into written agreements with eligible employers to provide internships that
65.2are at least 12 eight weeks long and located in greater Minnesota;
65.3(2) determine that the work experience of the internship is related to the eligible
65.4student's course of study; and
65.5(3) (2) provide academic credit for the successful completion of the internship or
65.6ensure that it fulfills requirements necessary to complete a vocational technical education
65.7program.
65.8(c) To participate in the program, an eligible employer must enter into a written
65.9agreement with an eligible institution specifying that the intern:
65.10(1) would not have been hired without the tax credit described in subdivision 4;
65.11(2) did not work for the employer in the same or a similar job prior to entering
65.12the agreement;
65.13(3) does not replace an existing employee;
65.14(4) has not previously participated in the program;
65.15(5) will be employed at a location in greater Minnesota;
65.16(6) will be paid at least minimum wage for a minimum of 16 hours per week for a
65.17period of at least 12 eight weeks; and
65.18(7) will be supervised and evaluated by the employer.
65.19(d) The written agreement between the eligible institution and the eligible employer
65.20must certify a credit amount to the employer, not to exceed $2,000 per intern. The total
65.21dollar amount of credits that an eligible institution certifies to eligible employers in a
65.22calendar year may not exceed the amount of its allocation under subdivision 4.
65.23(e) Participating eligible institutions and eligible employers must report annually to
65.24the office. The report must include at least the following:
65.25(1) the number of interns hired;
65.26(2) the number of hours and weeks worked by interns; and
65.27(3) the compensation paid to interns.
65.28(f) An internship required to complete an academic program does not qualify for the
65.29greater Minnesota internship program under this section.
65.30EFFECTIVE DATE.This section is effective the day following final enactment.

65.31    Sec. 6. Minnesota Statutes 2013 Supplement, section 136A.129, subdivision 5, is
65.32amended to read:
65.33    Subd. 5. Reports to the legislature. (a) By February 1, 2015 2016, the office
65.34and the Department of Revenue shall report to the legislature on the greater Minnesota
65.35internship program. The report must include at least the following:
66.1(1) the number and dollar amount of credits allowed;
66.2(2) the number of interns employed under the program; and
66.3(3) the cost of administering the program.
66.4(b) By February 1, 2016 2017, the office and the Department of Revenue shall
66.5report to the legislature with an analysis of the effectiveness of the program in stimulating
66.6businesses to hire interns and in assisting participating interns in finding permanent
66.7career positions. This report must include the number of students who participated in the
66.8program who were subsequently employed full-time by the employer.
66.9EFFECTIVE DATE.This section is effective the day following final enactment.

66.10    Sec. 7. Minnesota Statutes 2013 Supplement, section 270B.01, subdivision 8, is
66.11amended to read:
66.12    Subd. 8. Minnesota tax laws. For purposes of this chapter only, unless expressly
66.13stated otherwise, "Minnesota tax laws" means:
66.14    (1) the taxes, refunds, and fees administered by or paid to the commissioner under
66.15chapters 115B, 289A (except taxes imposed under sections 298.01, 298.015, and 298.24),
66.16290, 290A, 291, 292, 295, 297A, 297B, 297H, and 403, or any similar Indian tribal tax
66.17administered by the commissioner pursuant to any tax agreement between the state and
66.18the Indian tribal government, and includes any laws for the assessment, collection, and
66.19enforcement of those taxes, refunds, and fees; and
66.20    (2) section 273.1315.
66.21EFFECTIVE DATE.This section is effective the day following final enactment.

66.22    Sec. 8. Minnesota Statutes 2013 Supplement, section 270B.03, subdivision 1, is
66.23amended to read:
66.24    Subdivision 1. Who may inspect. Returns and return information must, on request,
66.25be made open to inspection by or disclosure to the data subject. The request must be made
66.26in writing or in accordance with written procedures of the chief disclosure officer of the
66.27department that have been approved by the commissioner to establish the identification
66.28of the person making the request as the data subject. For purposes of this chapter, the
66.29following are the data subject:
66.30(1) in the case of an individual return, that individual;
66.31(2) in the case of an income tax return filed jointly, either of the individuals with
66.32respect to whom the return is filed;
67.1(3) in the case of a return filed by a business entity, an officer of a corporation,
67.2a shareholder owning more than one percent of the stock, or any shareholder of an S
67.3corporation; a general partner in a partnership; the owner of a sole proprietorship; a
67.4member or manager of a limited liability company; a participant in a joint venture; the
67.5individual who signed the return on behalf of the business entity; or an employee who is
67.6responsible for handling the tax matters of the business entity, such as the tax manager,
67.7bookkeeper, or managing agent;
67.8(4) in the case of an estate return:
67.9(i) the personal representative or trustee of the estate; and
67.10(ii) any beneficiary of the estate as shown on the federal estate tax return;
67.11(5) in the case of a trust return:
67.12(i) the trustee or trustees, jointly or separately; and
67.13(ii) any beneficiary of the trust as shown in the trust instrument;
67.14(6) if liability has been assessed to a transferee under section 270C.58, subdivision
67.151
, the transferee is the data subject with regard to the returns and return information
67.16relating to the assessed liability;
67.17(7) in the case of an Indian tribal government or an Indian tribal government-owned
67.18entity,
67.19(i) the chair of the tribal government, or
67.20(ii) any person authorized by the tribal government; and
67.21(8) in the case of a successor as defined in section 270C.57, subdivision 1, paragraph
67.22(b), the successor is the data subject and information may be disclosed as provided by
67.23section 270C.57, subdivision 4; and.
67.24(9) in the case of a gift return, the donor.
67.25EFFECTIVE DATE.This section is effective the day following final enactment.

67.26    Sec. 9. Minnesota Statutes 2012, section 289A.02, subdivision 7, as amended by Laws
67.272014, chapter 150, article 1, section 7, is amended to read:
67.28    Subd. 7. Internal Revenue Code. Unless specifically defined otherwise, "Internal
67.29Revenue Code" means the Internal Revenue Code of 1986, as amended through December
67.3020, 2013 March 26, 2014.
67.31EFFECTIVE DATE.This section is effective retroactively for taxable years
67.32beginning after December 31, 2012.

68.1    Sec. 10. Minnesota Statutes 2013 Supplement, section 290.01, subdivision 19, as
68.2amended by Laws 2014, chapter 150, article 1, section 9, is amended to read:
68.3    Subd. 19. Net income. The term "net income" means the federal taxable income,
68.4as defined in section 63 of the Internal Revenue Code of 1986, as amended through the
68.5date named in this subdivision, incorporating the federal effective dates of changes to the
68.6Internal Revenue Code and any elections made by the taxpayer in accordance with the
68.7Internal Revenue Code in determining federal taxable income for federal income tax
68.8purposes, and with the modifications provided in subdivisions 19a to 19f.
68.9    In the case of a regulated investment company or a fund thereof, as defined in section
68.10851(a) or 851(g) of the Internal Revenue Code, federal taxable income means investment
68.11company taxable income as defined in section 852(b)(2) of the Internal Revenue Code,
68.12except that:
68.13    (1) the exclusion of net capital gain provided in section 852(b)(2)(A) of the Internal
68.14Revenue Code does not apply;
68.15    (2) the deduction for dividends paid under section 852(b)(2)(D) of the Internal
68.16Revenue Code must be applied by allowing a deduction for capital gain dividends and
68.17exempt-interest dividends as defined in sections 852(b)(3)(C) and 852(b)(5) of the Internal
68.18Revenue Code; and
68.19    (3) the deduction for dividends paid must also be applied in the amount of any
68.20undistributed capital gains which the regulated investment company elects to have treated
68.21as provided in section 852(b)(3)(D) of the Internal Revenue Code.
68.22    The net income of a real estate investment trust as defined and limited by section
68.23856(a), (b), and (c) of the Internal Revenue Code means the real estate investment trust
68.24taxable income as defined in section 857(b)(2) of the Internal Revenue Code.
68.25    The net income of a designated settlement fund as defined in section 468B(d) of
68.26the Internal Revenue Code means the gross income as defined in section 468B(b) of the
68.27Internal Revenue Code.
68.28    The Internal Revenue Code of 1986, as amended through December 20, 2013 March
68.2926, 2014, shall be in effect for taxable years beginning after December 31, 1996.
68.30    Except as otherwise provided, references to the Internal Revenue Code in
68.31subdivisions 19 to 19f mean the code in effect for purposes of determining net income for
68.32the applicable year.
68.33EFFECTIVE DATE.This section is effective the day following final enactment,
68.34except the changes incorporated by federal changes are effective retroactively at the same
68.35time as the changes were effective for federal purposes.

69.1    Sec. 11. Minnesota Statutes 2012, section 290.01, subdivision 19a, as amended by
69.2Laws 2014, chapter 150, article 1, section 10, is amended to read:
69.3    Subd. 19a. Additions to federal taxable income. For individuals, estates, and
69.4trusts, there shall be added to federal taxable income:
69.5    (1)(i) interest income on obligations of any state other than Minnesota or a political
69.6or governmental subdivision, municipality, or governmental agency or instrumentality
69.7of any state other than Minnesota exempt from federal income taxes under the Internal
69.8Revenue Code or any other federal statute; and
69.9    (ii) exempt-interest dividends as defined in section 852(b)(5) of the Internal Revenue
69.10Code, except:
69.11(A) the portion of the exempt-interest dividends exempt from state taxation under
69.12the laws of the United States; and
69.13(B) the portion of the exempt-interest dividends derived from interest income
69.14on obligations of the state of Minnesota or its political or governmental subdivisions,
69.15municipalities, governmental agencies or instrumentalities, but only if the portion of the
69.16exempt-interest dividends from such Minnesota sources paid to all shareholders represents
69.1795 percent or more of the exempt-interest dividends, including any dividends exempt
69.18under subitem (A), that are paid by the regulated investment company as defined in section
69.19851(a) of the Internal Revenue Code, or the fund of the regulated investment company as
69.20defined in section 851(g) of the Internal Revenue Code, making the payment; and
69.21    (iii) for the purposes of items (i) and (ii), interest on obligations of an Indian tribal
69.22government described in section 7871(c) of the Internal Revenue Code shall be treated as
69.23interest income on obligations of the state in which the tribe is located;
69.24    (2) the amount of income, sales and use, motor vehicle sales, or excise taxes paid or
69.25accrued within the taxable year under this chapter and the amount of taxes based on net
69.26income paid, sales and use, motor vehicle sales, or excise taxes paid to any other state or
69.27to any province or territory of Canada, to the extent allowed as a deduction under section
69.2863(d) of the Internal Revenue Code, but the addition may not be more than the amount
69.29by which the state itemized deduction exceeds the amount of the standard deduction as
69.30defined in section 63(c) of the Internal Revenue Code, minus any addition that would have
69.31been required under clause (17) if the taxpayer had claimed the standard deduction. For
69.32the purpose of this clause, income, sales and use, motor vehicle sales, or excise taxes are
69.33the last itemized deductions disallowed under clause (15);
69.34    (3) the capital gain amount of a lump-sum distribution to which the special tax under
69.35section 1122(h)(3)(B)(ii) of the Tax Reform Act of 1986, Public Law 99-514, applies;
70.1    (4) the amount of income taxes paid or accrued within the taxable year under this
70.2chapter and taxes based on net income paid to any other state or any province or territory
70.3of Canada, to the extent allowed as a deduction in determining federal adjusted gross
70.4income. For the purpose of this paragraph, income taxes do not include the taxes imposed
70.5by sections 290.0922, subdivision 1, paragraph (b), 290.9727, 290.9728, and 290.9729;
70.6    (5) the amount of expense, interest, or taxes disallowed pursuant to section 290.10
70.7other than expenses or interest used in computing net interest income for the subtraction
70.8allowed under subdivision 19b, clause (1);
70.9    (6) the amount of a partner's pro rata share of net income which does not flow
70.10through to the partner because the partnership elected to pay the tax on the income under
70.11section 6242(a)(2) of the Internal Revenue Code;
70.12    (7) 80 percent of the depreciation deduction allowed under section 168(k) of the
70.13Internal Revenue Code. For purposes of this clause, if the taxpayer has an activity that
70.14in the taxable year generates a deduction for depreciation under section 168(k) and the
70.15activity generates a loss for the taxable year that the taxpayer is not allowed to claim for
70.16the taxable year, "the depreciation allowed under section 168(k)" for the taxable year is
70.17limited to excess of the depreciation claimed by the activity under section 168(k) over the
70.18amount of the loss from the activity that is not allowed in the taxable year. In succeeding
70.19taxable years when the losses not allowed in the taxable year are allowed, the depreciation
70.20under section 168(k) is allowed;
70.21    (8) 80 percent of the amount by which the deduction allowed by section 179 of the
70.22Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal
70.23Revenue Code of 1986, as amended through December 31, 2003;
70.24    (9) to the extent deducted in computing federal taxable income, the amount of the
70.25deduction allowable under section 199 of the Internal Revenue Code;
70.26    (10) the amount of expenses disallowed under section 290.10, subdivision 2;
70.27    (11) for taxable years beginning before January 1, 2010, the amount deducted for
70.28qualified tuition and related expenses under section 222 of the Internal Revenue Code, to
70.29the extent deducted from gross income;
70.30    (12) for taxable years beginning before January 1, 2010, the amount deducted for
70.31certain expenses of elementary and secondary school teachers under section 62(a)(2)(D)
70.32of the Internal Revenue Code, to the extent deducted from gross income;
70.33(13) discharge of indebtedness income resulting from reacquisition of business
70.34indebtedness and deferred under section 108(i) of the Internal Revenue Code;
70.35(14) changes to federal taxable income attributable to a net operating loss that the
70.36taxpayer elected to carry back for more than two years for federal purposes but for which
71.1the losses can be carried back for only two years under section 290.095, subdivision
71.211
, paragraph (c);
71.3(15) to the extent included in the computation of federal taxable income in taxable
71.4years beginning after December 31, 2010, the amount of disallowed itemized deductions,
71.5but the amount of disallowed itemized deductions plus the addition required under clause
71.6(2) may not be more than the amount by which the itemized deductions as allowed under
71.7section 63(d) of the Internal Revenue Code exceeds the amount of the standard deduction
71.8as defined in section 63(c) of the Internal Revenue Code, and reduced by any addition
71.9that would have been required under clause (17) if the taxpayer had claimed the standard
71.10deduction:
71.11(i) the amount of disallowed itemized deductions is equal to the lesser of:
71.12(A) three percent of the excess of the taxpayer's federal adjusted gross income
71.13over the applicable amount; or
71.14(B) 80 percent of the amount of the itemized deductions otherwise allowable to the
71.15taxpayer under the Internal Revenue Code for the taxable year;
71.16(ii) the term "applicable amount" means $100,000, or $50,000 in the case of a
71.17married individual filing a separate return. Each dollar amount shall be increased by
71.18an amount equal to:
71.19(A) such dollar amount, multiplied by
71.20(B) the cost-of-living adjustment determined under section 1(f)(3) of the Internal
71.21Revenue Code for the calendar year in which the taxable year begins, by substituting
71.22"calendar year 1990" for "calendar year 1992" in subparagraph (B) thereof;
71.23(iii) the term "itemized deductions" does not include:
71.24(A) the deduction for medical expenses under section 213 of the Internal Revenue
71.25Code;
71.26(B) any deduction for investment interest as defined in section 163(d) of the Internal
71.27Revenue Code; and
71.28(C) the deduction under section 165(a) of the Internal Revenue Code for casualty or
71.29theft losses described in paragraph (2) or (3) of section 165(c) of the Internal Revenue
71.30Code or for losses described in section 165(d) of the Internal Revenue Code;
71.31(16) to the extent included in federal taxable income in taxable years beginning after
71.32December 31, 2010, the amount of disallowed personal exemptions for taxpayers with
71.33federal adjusted gross income over the threshold amount:
71.34(i) the disallowed personal exemption amount is equal to the dollar amount of the
71.35 number of personal exemptions claimed by the taxpayer in the computation of federal
71.36taxable income allowed under section 151(b) and (c) of the Internal Revenue Code
72.1multiplied by the dollar amount for personal exemptions under section 151(d)(1) and (2)
72.2of the Internal Revenue Code, as adjusted for inflation by section 151(d)(4) of the Internal
72.3Revenue Code, and by the applicable percentage;
72.4(ii) "applicable percentage" means two percentage points for each $2,500 (or
72.5fraction thereof) by which the taxpayer's federal adjusted gross income for the taxable
72.6year exceeds the threshold amount. In the case of a married individual filing a separate
72.7return, the preceding sentence shall be applied by substituting "$1,250" for "$2,500." In
72.8no event shall the applicable percentage exceed 100 percent;
72.9(iii) the term "threshold amount" means:
72.10(A) $150,000 in the case of a joint return or a surviving spouse;
72.11(B) $125,000 in the case of a head of a household;
72.12(C) $100,000 in the case of an individual who is not married and who is not a
72.13surviving spouse or head of a household; and
72.14(D) $75,000 in the case of a married individual filing a separate return; and
72.15(iv) the thresholds shall be increased by an amount equal to:
72.16(A) such dollar amount, multiplied by
72.17(B) the cost-of-living adjustment determined under section 1(f)(3) of the Internal
72.18Revenue Code for the calendar year in which the taxable year begins, by substituting
72.19"calendar year 1990" for "calendar year 1992" in subparagraph (B) thereof; and
72.20(17) to the extent deducted in the computation of federal taxable income, for taxable
72.21years beginning after December 31, 2010, and before January 1, 2014, the difference
72.22between the standard deduction allowed under section 63(c) of the Internal Revenue Code
72.23and the standard deduction allowed for 2011, 2012, and 2013 under the Internal Revenue
72.24Code as amended through December 1, 2010.
72.25EFFECTIVE DATE.This section is effective retroactively for taxable years
72.26beginning after December 31, 2012.

72.27    Sec. 12. Minnesota Statutes 2013 Supplement, section 290.01, subdivision 19b, as
72.28amended by Laws 2014, chapter 150, article 1, section 11, is amended to read:
72.29    Subd. 19b. Subtractions from federal taxable income. For individuals, estates,
72.30and trusts, there shall be subtracted from federal taxable income:
72.31    (1) net interest income on obligations of any authority, commission, or
72.32instrumentality of the United States to the extent includable in taxable income for federal
72.33income tax purposes but exempt from state income tax under the laws of the United States;
73.1    (2) if included in federal taxable income, the amount of any overpayment of income
73.2tax to Minnesota or to any other state, for any previous taxable year, whether the amount
73.3is received as a refund or as a credit to another taxable year's income tax liability;
73.4    (3) the amount paid to others, less the amount used to claim the credit allowed under
73.5section 290.0674, not to exceed $1,625 for each qualifying child in grades kindergarten
73.6to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and
73.7transportation of each qualifying child in attending an elementary or secondary school
73.8situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a
73.9resident of this state may legally fulfill the state's compulsory attendance laws, which
73.10is not operated for profit, and which adheres to the provisions of the Civil Rights Act
73.11of 1964 and chapter 363A. For the purposes of this clause, "tuition" includes fees or
73.12tuition as defined in section 290.0674, subdivision 1, clause (1). As used in this clause,
73.13"textbooks" includes books and other instructional materials and equipment purchased
73.14or leased for use in elementary and secondary schools in teaching only those subjects
73.15legally and commonly taught in public elementary and secondary schools in this state.
73.16Equipment expenses qualifying for deduction includes expenses as defined and limited in
73.17section 290.0674, subdivision 1, clause (3). "Textbooks" does not include instructional
73.18books and materials used in the teaching of religious tenets, doctrines, or worship, the
73.19purpose of which is to instill such tenets, doctrines, or worship, nor does it include books
73.20or materials for, or transportation to, extracurricular activities including sporting events,
73.21musical or dramatic events, speech activities, driver's education, or similar programs. No
73.22deduction is permitted for any expense the taxpayer incurred in using the taxpayer's or
73.23the qualifying child's vehicle to provide such transportation for a qualifying child. For
73.24purposes of the subtraction provided by this clause, "qualifying child" has the meaning
73.25given in section 32(c)(3) of the Internal Revenue Code;
73.26    (4) income as provided under section 290.0802;
73.27    (5) to the extent included in federal adjusted gross income, income realized on
73.28disposition of property exempt from tax under section 290.491;
73.29    (6) to the extent not deducted or not deductible pursuant to section 408(d)(8)(E)
73.30of the Internal Revenue Code in determining federal taxable income by an individual
73.31who does not itemize deductions for federal income tax purposes for the taxable year, an
73.32amount equal to 50 percent of the excess of charitable contributions over $500 allowable
73.33as a deduction for the taxable year under section 170(a) of the Internal Revenue Code,
73.34under the provisions of Public Law 109-1 and Public Law 111-126;
73.35    (7) for individuals who are allowed a federal foreign tax credit for taxes that do not
73.36qualify for a credit under section 290.06, subdivision 22, an amount equal to the carryover
74.1of subnational foreign taxes for the taxable year, but not to exceed the total subnational
74.2foreign taxes reported in claiming the foreign tax credit. For purposes of this clause,
74.3"federal foreign tax credit" means the credit allowed under section 27 of the Internal
74.4Revenue Code, and "carryover of subnational foreign taxes" equals the carryover allowed
74.5under section 904(c) of the Internal Revenue Code minus national level foreign taxes to
74.6the extent they exceed the federal foreign tax credit;
74.7    (8) in each of the five tax years immediately following the tax year in which an
74.8addition is required under subdivision 19a, clause (7), or 19c, clause (12), in the case of a
74.9shareholder of a corporation that is an S corporation, an amount equal to one-fifth of the
74.10delayed depreciation. For purposes of this clause, "delayed depreciation" means the amount
74.11of the addition made by the taxpayer under subdivision 19a, clause (7), or subdivision 19c,
74.12clause (12), in the case of a shareholder of an S corporation, minus the positive value of
74.13any net operating loss under section 172 of the Internal Revenue Code generated for the
74.14tax year of the addition. The resulting delayed depreciation cannot be less than zero;
74.15    (9) job opportunity building zone income as provided under section 469.316;
74.16    (10) to the extent included in federal taxable income, the amount of compensation
74.17paid to members of the Minnesota National Guard or other reserve components of
74.18the United States military for active service, excluding including compensation for
74.19services performed under the Active Guard Reserve (AGR) program. For purposes of
74.20this clause, "active service" means (i) state active service as defined in section 190.05,
74.21subdivision 5a
, clause (1); or (ii) federally funded state active service as defined in section
74.22190.05, subdivision 5b , but and "active service" excludes includes service performed in
74.23accordance with section 190.08, subdivision 3;
74.24    (11) to the extent included in federal taxable income, the amount of compensation
74.25paid to Minnesota residents who are members of the armed forces of the United States
74.26or United Nations for active duty performed under United States Code, title 10; or the
74.27authority of the United Nations;
74.28    (12) an amount, not to exceed $10,000, equal to qualified expenses related to a
74.29qualified donor's donation, while living, of one or more of the qualified donor's organs
74.30to another person for human organ transplantation. For purposes of this clause, "organ"
74.31means all or part of an individual's liver, pancreas, kidney, intestine, lung, or bone marrow;
74.32"human organ transplantation" means the medical procedure by which transfer of a human
74.33organ is made from the body of one person to the body of another person; "qualified
74.34expenses" means unreimbursed expenses for both the individual and the qualified donor
74.35for (i) travel, (ii) lodging, and (iii) lost wages net of sick pay, except that such expenses
74.36may be subtracted under this clause only once; and "qualified donor" means the individual
75.1or the individual's dependent, as defined in section 152 of the Internal Revenue Code. An
75.2individual may claim the subtraction in this clause for each instance of organ donation for
75.3transplantation during the taxable year in which the qualified expenses occur;
75.4    (13) in each of the five tax years immediately following the tax year in which an
75.5addition is required under subdivision 19a, clause (8), or 19c, clause (13), in the case of a
75.6shareholder of a corporation that is an S corporation, an amount equal to one-fifth of the
75.7addition made by the taxpayer under subdivision 19a, clause (8), or 19c, clause (13), in the
75.8case of a shareholder of a corporation that is an S corporation, minus the positive value of
75.9any net operating loss under section 172 of the Internal Revenue Code generated for the
75.10tax year of the addition. If the net operating loss exceeds the addition for the tax year, a
75.11subtraction is not allowed under this clause;
75.12    (14) to the extent included in the federal taxable income of a nonresident of
75.13Minnesota, compensation paid to a service member as defined in United States Code, title
75.1410, section 101(a)(5), for military service as defined in the Servicemembers Civil Relief
75.15Act, Public Law 108-189, section 101(2);
75.16    (15) to the extent included in federal taxable income, the amount of national service
75.17educational awards received from the National Service Trust under United States Code,
75.18title 42, sections 12601 to 12604, for service in an approved Americorps National Service
75.19program;
75.20(16) to the extent included in federal taxable income, discharge of indebtedness
75.21income resulting from reacquisition of business indebtedness included in federal taxable
75.22income under section 108(i) of the Internal Revenue Code. This subtraction applies only
75.23to the extent that the income was included in net income in a prior year as a result of the
75.24addition under section 290.01, subdivision 19a, clause (13);
75.25(17) the amount of the net operating loss allowed under section 290.095, subdivision
75.2611
, paragraph (c);
75.27(18) the amount of expenses not allowed for federal income tax purposes due
75.28to claiming the railroad track maintenance credit under section 45G(a) of the Internal
75.29Revenue Code;
75.30(19) the amount of the limitation on itemized deductions under section 68(b) of
75.31the Internal Revenue Code; and
75.32(20) the amount of the phaseout of personal exemptions under section 151(d) of
75.33the Internal Revenue Code.; and
75.34(21) to the extent included in federal taxable income, the amount of qualified
75.35transportation fringe benefits described in section 132(f)(1)(A) and (B) of the Internal
75.36Revenue Code. The subtraction is limited to the lesser of the amount of qualified
76.1transportation fringe benefits received in excess of the limitations under section
76.2132(f)(2)(A) of the Internal Revenue Code for the year or the difference between the
76.3maximum qualified parking benefits excludable under section 132(f)(2)(B) of the Internal
76.4Revenue Code minus the amount of transit benefits excludable under section 132(f)(2)(A)
76.5of the Internal Revenue Code.
76.6EFFECTIVE DATE.This section is effective for taxable years beginning after
76.7December 31, 2013.

76.8    Sec. 13. Minnesota Statutes 2013 Supplement, section 290.01, subdivision 31, as
76.9amended by Laws 2014, chapter 150, article 1, section 13, is amended to read:
76.10    Subd. 31. Internal Revenue Code. Unless specifically defined otherwise, "Internal
76.11Revenue Code" means the Internal Revenue Code of 1986, as amended through December
76.1220, 2013 March 26, 2014. Internal Revenue Code also includes any uncodified provision
76.13in federal law that relates to provisions of the Internal Revenue Code that are incorporated
76.14into Minnesota law. When used in this chapter, the reference to "subtitle A, chapter 1,
76.15subchapter N, part 1, of the Internal Revenue Code" is to the Internal Revenue Code as
76.16amended through March 18, 2010.
76.17EFFECTIVE DATE.This section is effective the day following final enactment,
76.18except the changes incorporated by federal changes are effective retroactively at the same
76.19time as the changes were effective for federal purposes.

76.20    Sec. 14. Minnesota Statutes 2012, section 290.081, is amended to read:
76.21290.081 INCOME OF NONRESIDENTS, RECIPROCITY.
76.22(a) The compensation received for the performance of personal or professional
76.23services within this state by an individual whose residence, place of abode, and place
76.24customarily returned to at least once a month is in another state, shall be excluded from
76.25gross income to the extent such compensation is subject to an income tax imposed by the
76.26state of residence; provided that such state allows a similar exclusion of compensation
76.27received by residents of Minnesota for services performed therein.
76.28(b) When it is deemed to be in the best interests of the people of this state, the
76.29commissioner may determine that the provisions of paragraph (a) shall not apply. As long
76.30as the provisions of paragraph (a) apply between Minnesota and Wisconsin, the provisions
76.31of paragraph (a) shall apply to any individual who is domiciled in Wisconsin.
76.32(c) For the purposes of paragraph (a), whenever the Wisconsin tax on Minnesota
76.33residents which would have been paid Wisconsin without paragraph (a) exceeds the
77.1Minnesota tax on Wisconsin residents which would have been paid Minnesota without
77.2paragraph (a), or vice versa, then the state with the net revenue loss resulting from
77.3paragraph (a) must be compensated by shall receive from the other state as provided in the
77.4agreement under paragraph (d) the amount of such loss. This provision shall be effective
77.5for all years beginning after December 31, 1972. The data used for computing the loss
77.6to either state shall be determined on or before September 30 of the year following the
77.7close of the previous calendar year.
77.8(d)(1) Interest is payable on all amounts calculated under paragraph (c) relating
77.9to taxable years beginning after December 31, 2000. Interest accrues from July 1 of
77.10the taxable year.
77.11(2) The commissioner of revenue is authorized to enter into agreements with
77.12the state of Wisconsin specifying the compensation required under paragraph (b), the
77.13reciprocity payment due date dates, conditions constituting delinquency, interest rates, and
77.14a method for computing interest due. Calculation of compensation under the agreement
77.15must specify if the revenue loss is determined before or after the allowance of each state's
77.16credit for taxes paid to the other state.
77.17(3) For agreements entered into before October 1, 2014, the annual compensation
77.18required under paragraph (c) must equal at least the net revenue loss minus $1,000,000
77.19per fiscal year.
77.20(4) For agreements entered into after September 30, 2014, the annual compensation
77.21required under paragraph (c) must equal the net revenue loss per fiscal year.
77.22(5) For the purposes of clauses (3) and (4), "net revenue loss" means the difference
77.23between the amount of Minnesota income taxes Minnesota forgoes by not taxing
77.24Wisconsin residents on income subject to reciprocity and the credit Minnesota would
77.25have been required to give under section 290.06, subdivision 22, to Minnesota residents
77.26working in Wisconsin had there not been reciprocity.
77.27(e) If an agreement cannot be reached as to the amount of the loss, the commissioner
77.28of revenue and the taxing official of the state of Wisconsin shall each appoint a member
77.29of a board of arbitration and these members shall appoint the third member of the board.
77.30The board shall select one of its members as chair. Such board may administer oaths, take
77.31testimony, subpoena witnesses, and require their attendance, require the production of
77.32books, papers and documents, and hold hearings at such places as are deemed necessary.
77.33The board shall then make a determination as to the amount to be paid the other state
77.34which determination shall be final and conclusive.
77.35(f) The commissioner may furnish copies of returns, reports, or other information to
77.36the taxing official of the state of Wisconsin, a member of the board of arbitration, or a
78.1consultant under joint contract with the states of Minnesota and Wisconsin for the purpose
78.2of making a determination as to the amount to be paid the other state under the provisions
78.3of this section. Prior to the release of any information under the provisions of this section,
78.4the person to whom the information is to be released shall sign an agreement which
78.5provides that the person will protect the confidentiality of the returns and information
78.6revealed thereby to the extent that it is protected under the laws of the state of Minnesota.
78.7EFFECTIVE DATE.This section is effective the day following final enactment.

78.8    Sec. 15. Minnesota Statutes 2013 Supplement, section 290.091, subdivision 2, as
78.9amended by Laws 2014, chapter 150, article 1, section 21, is amended to read:
78.10    Subd. 2. Definitions. For purposes of the tax imposed by this section, the following
78.11terms have the meanings given:
78.12    (a) "Alternative minimum taxable income" means the sum of the following for
78.13the taxable year:
78.14    (1) the taxpayer's federal alternative minimum taxable income as defined in section
78.1555(b)(2) of the Internal Revenue Code;
78.16    (2) the taxpayer's itemized deductions allowed in computing federal alternative
78.17minimum taxable income, but excluding:
78.18    (i) the charitable contribution deduction under section 170 of the Internal Revenue
78.19Code;
78.20    (ii) the medical expense deduction;
78.21    (iii) the casualty, theft, and disaster loss deduction; and
78.22    (iv) the impairment-related work expenses of a disabled person;
78.23    (3) for depletion allowances computed under section 613A(c) of the Internal
78.24Revenue Code, with respect to each property (as defined in section 614 of the Internal
78.25Revenue Code), to the extent not included in federal alternative minimum taxable income,
78.26the excess of the deduction for depletion allowable under section 611 of the Internal
78.27Revenue Code for the taxable year over the adjusted basis of the property at the end of the
78.28taxable year (determined without regard to the depletion deduction for the taxable year);
78.29    (4) to the extent not included in federal alternative minimum taxable income, the
78.30amount of the tax preference for intangible drilling cost under section 57(a)(2) of the
78.31Internal Revenue Code determined without regard to subparagraph (E);
78.32    (5) to the extent not included in federal alternative minimum taxable income, the
78.33amount of interest income as provided by section 290.01, subdivision 19a, clause (1); and
78.34    (6) the amount of addition required by section 290.01, subdivision 19a, clauses (7)
78.35to (9), and (11) to (14);
79.1    less the sum of the amounts determined under the following:
79.2    (1) interest income as defined in section 290.01, subdivision 19b, clause (1);
79.3    (2) an overpayment of state income tax as provided by section 290.01, subdivision
79.419b
, clause (2), to the extent included in federal alternative minimum taxable income;
79.5    (3) the amount of investment interest paid or accrued within the taxable year on
79.6indebtedness to the extent that the amount does not exceed net investment income, as
79.7defined in section 163(d)(4) of the Internal Revenue Code. Interest does not include
79.8amounts deducted in computing federal adjusted gross income;
79.9    (4) amounts subtracted from federal taxable income as provided by section 290.01,
79.10subdivision 19b
, clauses (6), (8) to (14), and (16), and (21); and
79.11(5) the amount of the net operating loss allowed under section 290.095, subdivision
79.1211
, paragraph (c).
79.13    In the case of an estate or trust, alternative minimum taxable income must be
79.14computed as provided in section 59(c) of the Internal Revenue Code.
79.15    (b) "Investment interest" means investment interest as defined in section 163(d)(3)
79.16of the Internal Revenue Code.
79.17    (c) "Net minimum tax" means the minimum tax imposed by this section.
79.18    (d) "Regular tax" means the tax that would be imposed under this chapter (without
79.19regard to this section and section 290.032), reduced by the sum of the nonrefundable
79.20credits allowed under this chapter.
79.21    (e) "Tentative minimum tax" equals 6.75 percent of alternative minimum taxable
79.22income after subtracting the exemption amount determined under subdivision 3.
79.23EFFECTIVE DATE.This section is effective for taxable years beginning after
79.24December 31, 2013.

79.25    Sec. 16. Minnesota Statutes 2013 Supplement, section 290A.03, subdivision 15, as
79.26amended by Laws 2014, chapter 150, article 1, section 22, is amended to read:
79.27    Subd. 15. Internal Revenue Code. "Internal Revenue Code" means the Internal
79.28Revenue Code of 1986, as amended through December 20, 2013 March 26, 2014.
79.29EFFECTIVE DATE.This section is effective retroactively for property tax refunds
79.30based on property taxes payable after December 31, 2013, and rent paid after December
79.3131, 2012.

79.32    Sec. 17. Minnesota Statutes 2013 Supplement, section 291.005, subdivision 1, as
79.33amended by Laws 2014, chapter 150, article 3, section 3, is amended to read:
80.1    Subdivision 1. Scope. Unless the context otherwise clearly requires, the following
80.2terms used in this chapter shall have the following meanings:
80.3    (1) "Commissioner" means the commissioner of revenue or any person to whom the
80.4commissioner has delegated functions under this chapter.
80.5    (2) "Federal gross estate" means the gross estate of a decedent as required to be valued
80.6and otherwise determined for federal estate tax purposes under the Internal Revenue Code,
80.7increased by the value of any property in which the decedent had a qualifying income
80.8interest for life and for which an election was made under section 291.03, subdivision 1d,
80.9for Minnesota estate tax purposes, but was not made for federal estate tax purposes.
80.10    (3) "Internal Revenue Code" means the United States Internal Revenue Code of
80.111986, as amended through March 1 March 26, 2014.
80.12    (4) "Minnesota gross estate" means the federal gross estate of a decedent after
80.13(a) excluding therefrom any property included in the estate which has its situs outside
80.14Minnesota, and (b) including any property omitted from the federal gross estate which
80.15is includable in the estate, has its situs in Minnesota, and was not disclosed to federal
80.16taxing authorities.
80.17    (5) "Nonresident decedent" means an individual whose domicile at the time of
80.18death was not in Minnesota.
80.19    (6) "Personal representative" means the executor, administrator or other person
80.20appointed by the court to administer and dispose of the property of the decedent. If there
80.21is no executor, administrator or other person appointed, qualified, and acting within this
80.22state, then any person in actual or constructive possession of any property having a situs in
80.23this state which is included in the federal gross estate of the decedent shall be deemed
80.24to be a personal representative to the extent of the property and the Minnesota estate tax
80.25due with respect to the property.
80.26    (7) "Resident decedent" means an individual whose domicile at the time of death
80.27was in Minnesota.
80.28    (8) "Situs of property" means, with respect to:
80.29    (i) real property, the state or country in which it is located;
80.30    (ii) tangible personal property, the state or country in which it was normally kept
80.31or located at the time of the decedent's death or for a gift of tangible personal property
80.32within three years of death, the state or country in which it was normally kept or located
80.33when the gift was executed; and
80.34    (iii) a qualified work of art, as defined in section 2503(g)(2) of the Internal Revenue
80.35Code, owned by a nonresident decedent and that is normally kept or located in this state
80.36because it is on loan to an organization, qualifying as exempt from taxation under section
81.1501(c)(3) of the Internal Revenue Code, that is located in Minnesota, the situs of the art is
81.2deemed to be outside of Minnesota, notwithstanding the provisions of item (ii); and
81.3    (iv) intangible personal property, the state or country in which the decedent was
81.4domiciled at death or for a gift of intangible personal property within three years of death,
81.5the state or country in which the decedent was domiciled when the gift was executed.
81.6    For a nonresident decedent with an ownership interest in a pass-through entity with
81.7assets that include real or tangible personal property, situs of the real or tangible personal
81.8property, including qualified works of art, is determined as if the pass-through entity does
81.9not exist and the real or tangible personal property is personally owned by the decedent.
81.10If the pass-through entity is owned by a person or persons in addition to the decedent,
81.11ownership of the property is attributed to the decedent in proportion to the decedent's
81.12capital ownership share of the pass-through entity.
81.13(9) "Pass-through entity" includes the following:
81.14(i) an entity electing S corporation status under section 1362 of the Internal Revenue
81.15Code;
81.16(ii) an entity taxed as a partnership under subchapter K of the Internal Revenue Code;
81.17(iii) a single-member limited liability company or similar entity, regardless of
81.18whether it is taxed as an association or is disregarded for federal income tax purposes
81.19under Code of Federal Regulations, title 26, section 301.7701-3; or
81.20(iv) a trust to the extent the property is includible in the decedent's federal gross
81.21estate; but excludes
81.22    (v) an entity whose ownership interest securities are traded on an exchange regulated
81.23by the Securities and Exchange Commission as a national securities exchange under
81.24section 6 of the Securities Exchange Act, United States Code, title 15, section 78f.
81.25EFFECTIVE DATE.This section is effective retroactively for estates of decedents
81.26dying after December 31, 2013.

81.27    Sec. 18. Minnesota Statutes 2012, section 291.016, subdivision 1, as added by Laws
81.282014, chapter 150, article 3, section 4, is amended to read:
81.29    Subdivision 1. General. For purposes of the tax under this chapter, the Minnesota
81.30taxable estate equals the federal taxable estate as provided under section 2051 of the Internal
81.31Revenue Code, without regard to whether the estate is subject to the federal estate tax:
81.32(1) increased by the value of any property in which the decedent had a qualifying
81.33income interest for life and for which an election was made under section 291.03,
81.34subdivision 1d, for Minnesota estate tax purposes, but was not made for federal estate
81.35tax purposes;
82.1(2) increased by the additions under subdivision 2; and
82.2(2) (3) decreased by the subtraction under subdivision 3.
82.3EFFECTIVE DATE.This section is effective retroactively for estates of decedents
82.4dying after December 31, 2013.

82.5    Sec. 19. Minnesota Statutes 2012, section 291.031, as added by Laws 2014, chapter
82.6150, article 3, section 7, is amended to read:
82.7291.031 CREDITS.
82.8(a) The estate of a nonresident decedent that is subject to tax under this chapter on
82.9the value of Minnesota situs property held in a pass-through entity is allowed a credit
82.10against the tax due under this section 291.03 equal to the lesser of:
82.11(1) the amount of estate or inheritance tax paid to another state that is attributable to
82.12the Minnesota situs property held in the pass-through entity; or
82.13(2) the amount of tax paid under this section attributable to the Minnesota situs
82.14property held in the pass-through entity.
82.15(b) The amount of tax attributable to the Minnesota situs property held in the
82.16pass-through entity must be determined by the increase in the estate or inheritance tax that
82.17results from including the market value of the property in the estate or treating the value
82.18as a taxable inheritance to the recipient of the property.
82.19EFFECTIVE DATE.This section is effective retroactively for estates of decedents
82.20dying after December 31, 2013.

82.21    Sec. 20. Laws 2014, chapter 150, article 3, section 4, the effective date, is amended to
82.22read:
82.23EFFECTIVE DATE.This section is effective retroactively for estates of decedents
82.24dying after December 31, 2013, and for taxable gifts made after June 30, 2013.
82.25EFFECTIVE DATE.This section is effective the day following final enactment.

82.26    Sec. 21. DEFINITION OF TAXABLE GIFT FOR DECEDENTS DYING
82.27BEFORE JANUARY 1, 2014.
82.28For estates of decedents dying before January 1, 2014, "taxable gift" as used by
82.29Minnesota Statutes, section 291.005, subdivision 1, paragraph (4), means a transfer by gift
82.30which is included in taxable gifts for federal gift tax purposes under the following sections
82.31of the Internal Revenue Code: section 529; section 530; section 2501(a)(4); section 2503;
83.1sections 2511 to 2514; and sections 2516 to 2519; less the deductions allowed in sections
83.22522 to 2524 of the Internal Revenue Code, and after excluding taxable gifts of any
83.3property that has its situs outside Minnesota and including taxable gifts of any property
83.4that has its situs in Minnesota and were not disclosed to federal taxing authorities.
83.5EFFECTIVE DATE.This section is effective retroactively for taxable gifts made
83.6after June 30, 2013.

83.7    Sec. 22. TEMPORARY READING CREDIT.
83.8    Subdivision 1. Reading credit. (a) A taxpayer is allowed a credit, up to $2,000,
83.9against the tax imposed by Minnesota Statutes, chapter 290. The credit amount equals 75
83.10percent of the amount of eligible expenses paid by a taxpayer who is a parent or guardian
83.11of a qualifying child:
83.12(1) who has been evaluated for determination of a specific learning disability under
83.13Minnesota Rules, part 3525.1341, and was not found to meet the criteria under Minnesota
83.14Rules, part 3525.1341, subpart 2, to have a specific learning disability; and
83.15(2) for whom the evaluation indicated a determination of a deficiency in basic
83.16reading skills, reading comprehension, or reading fluency that impair a child to meet
83.17expected age or grade-level standards.
83.18(b) For purposes of this subdivision, the following definitions apply:
83.19(1) "eligible expenses" means actual expenses, less the amount of expenses used to
83.20claim the credit under Minnesota Statutes, section 290.0674, subdivision 1, paid by the
83.21taxpayer for tutoring, instruction, or treatment by an instructor and not compensated by
83.22insurance, pretax account, or otherwise, for purposes of meeting the academic standards
83.23required under Minnesota Statutes, section 120B.021;
83.24(2) "instructor" means a person qualifying under Minnesota Statutes, section
83.25120A.22, subdivision 10, clauses (1) to (5), who is not a lineal ancestor or sibling of
83.26the qualifying child;
83.27(3) "treatment" means instruction that:
83.28(i) teaches language decoding skills in a systematic manner;
83.29(ii) uses recognized diagnostic assessments to determine what intervention would be
83.30most appropriate for individual students; and
83.31(iii) employs a research-based method; and
83.32(4) "qualifying child" has the meaning given in section 32(c)(3) of the Internal
83.33Revenue Code.
83.34(c) A taxpayer claiming the credit under this subdivision must provide documentation
83.35of eligibility for the credit in a form and manner prescribed by the commissioner of
84.1revenue in consultation with the commissioner of education. The documentation under
84.2this paragraph must not disclose any information other than that necessary to prove
84.3eligibility for the credit allowed under this subdivision.
84.4(d) For a nonresident or part-year resident, the credit determined under this section
84.5must be allocated based on the percentage calculated under Minnesota Statutes, section
84.6290.06, subdivision 2c, paragraph (e).
84.7(e) The amount used to claim the credit under this section must be excluded from
84.8any amount subtracted from federal taxable income under section 290.01, subdivision
84.919b, clause (3).
84.10    Subd. 2. Assignment of refunds. The provisions of Minnesota Statutes, section
84.11290.0679, except for subdivision 1, paragraphs (a) and (b), apply to the assignment of
84.12refunds authorized under this section. For purposes of assignment of refund under this
84.13section, a "qualifying taxpayer" means a taxpayer qualified to receive a credit under this
84.14section. In no case shall any condition for assignment require disclosure of the specific
84.15findings of an evaluation for a specific learning disability.
84.16    Subd. 3. Credit to be refundable. If the amount of total credits that the claimant is
84.17eligible to receive under this section exceeds the claimant's tax liability under Minnesota
84.18Statutes, chapter 290, the commissioner of revenue shall refund the excess to the claimant.
84.19    Subd. 4. Appropriation. An amount sufficient to pay the refunds authorized under
84.20this section is appropriated to the commissioner of revenue from the general fund.
84.21    Subd. 5. Report. By March 1, 2016, the commissioner of revenue, in compliance
84.22with Minnesota Statutes, sections 3.195 and 3.197, must provide a report to the chairs and
84.23ranking minority members of the committees of the house of representatives and senate
84.24with jurisdiction over taxes and education on:
84.25(1) the number of taxpayers claiming the credit under this section and the average
84.26amount of credits claimed; and
84.27(2) the administration of the credit, including recommendations for ensuring
84.28compliance.
84.29EFFECTIVE DATE.This section is effective for taxable years beginning after
84.30December 31, 2013, and before January 1, 2015 only.

84.31ARTICLE 5
84.32MINERALS TAXES

84.33    Section 1. Minnesota Statutes 2012, section 276A.06, subdivision 3, as amended by
84.34Laws 2014, chapter 150, article 6, section 5, is amended to read:
85.1    Subd. 3. Apportionment of levy. The county auditor shall apportion the levy of
85.2each governmental unit in the county in the manner prescribed by this subdivision. The
85.3auditor shall:
85.4(a) by August 20 of 2014 and each subsequent year, determine the preliminary
85.5areawide portion of the levy for each governmental unit by multiplying the local tax
85.6rate of the governmental unit for the preceding levy year times the distribution value set
85.7forth in subdivision 2, clause (b),;
85.8(b) by September 5 of 2014 and each subsequent year, determine the areawide
85.9portion of the levy for each governmental unit by multiplying the preliminary areawide
85.10portion of the levy for each governmental unit times a fraction, the numerator of which is
85.11the difference between the sum of the preliminary areawide levies for all governmental
85.12units in the area minus the school fund allocation and the denominator is the sum of the
85.13preliminary areawide levy for all governmental units in the area; and
85.14(b) (c) by September 5 of 2014 and each subsequent year, determine the local
85.15portion of the current year's levy by subtracting the resulting amount from clause (a) from
85.16the governmental unit's current year's levy.
85.17EFFECTIVE DATE.This section is effective for taxes payable in 2015 and
85.18thereafter.

85.19    Sec. 2. Minnesota Statutes 2012, section 276A.06, subdivision 5, as amended by Laws
85.202014, chapter 150, article 6, section 6, is amended to read:
85.21    Subd. 5. Areawide tax rate. On or before August 25 of 1997 and each subsequent
85.22year, the county auditor shall certify to the administrative auditor that the preliminary
85.23 portion of the levy of each governmental unit determined pursuant to subdivision 3, clause
85.24(a). The administrative auditor shall then determine the areawide tax rate sufficient to
85.25yield an amount equal to the sum of the levies from the preliminary areawide net tax
85.26capacity plus the school fund allocation. On or before September 1, the administrative
85.27auditor shall certify the areawide tax rate to each of the county auditors.
85.28EFFECTIVE DATE.This section is effective for taxes payable in 2015 and
85.29thereafter.

85.30    Sec. 3. Minnesota Statutes 2013 Supplement, section 298.018, subdivision 1, is
85.31amended to read:
86.1    Subdivision 1. Within taconite assistance area. The proceeds of the tax paid under
86.2sections 298.015 and 298.016 on ores, metals, or minerals mined or extracted within the
86.3taconite assistance area defined in section 273.1341, shall be allocated as follows:
86.4    (1) five percent to the city or town within which the minerals or energy resources
86.5are mined or extracted, or within which the concentrate was produced. If the mining
86.6and concentration, or different steps in either process, are carried on in more than one
86.7taxing district, the commissioner shall apportion equitably the proceeds among the
86.8cities and towns by attributing 50 percent of the proceeds of the tax to the operation of
86.9mining or extraction, and the remainder to the concentrating plant and to the processes of
86.10concentration, and with respect to each thereof giving due consideration to the relative
86.11extent of the respective operations performed in each taxing district;
86.12    (2) ten percent to the taconite municipal aid account to be distributed as provided
86.13in section 298.282;
86.14    (3) ten percent to the school district within which the minerals or energy resources
86.15are mined or extracted, or within which the concentrate was produced. If the mining
86.16and concentration, or different steps in either process, are carried on in more than one
86.17school district, distribution among the school districts must be based on the apportionment
86.18formula prescribed in clause (1);
86.19    (4) 20 percent to a group of school districts comprised of those school districts
86.20wherein the mineral or energy resource was mined or extracted or in which there is a
86.21qualifying municipality as defined by section 273.134, paragraph (b), in direct proportion
86.22to school district indexes as follows: for each school district, its pupil units determined
86.23under section 126C.05 for the prior school year shall be multiplied by the ratio of the
86.24average adjusted net tax capacity per pupil unit for school districts receiving aid under
86.25this clause as calculated pursuant to chapters 122A, 126C, and 127A for the school year
86.26ending prior to distribution to the adjusted net tax capacity per pupil unit of the district.
86.27Each district shall receive that portion of the distribution which its index bears to the sum
86.28of the indices for all school districts that receive the distributions;
86.29    (5) 20 percent to the county within which the minerals or energy resources are
86.30mined or extracted, or within which the concentrate was produced. If the mining and
86.31concentration, or different steps in either process, are carried on in more than one county,
86.32distribution among the counties must be based on the apportionment formula prescribed in
86.33clause (1), provided that any county receiving distributions under this clause shall pay one
86.34percent of its proceeds to the Range Association of Municipalities and Schools;
86.35    (6) 20 percent to St. Louis County acting as the counties' fiscal agent to be
86.36distributed as provided in sections 273.134 to 273.136;
87.1    (7) five percent to the Iron Range Resources and Rehabilitation Board for the
87.2purposes of section 298.22;
87.3    (8) five three percent to the Douglas J. Johnson economic protection trust fund; and
87.4    (9) five seven percent to the taconite environmental protection fund.
87.5    The proceeds of the tax shall be distributed on July 15 each year.
87.6EFFECTIVE DATE.This section is effective July 1, 2014.

87.7    Sec. 4. Minnesota Statutes 2012, section 298.28, subdivision 5, as amended by Laws
87.82014, chapter 150, article 6, section 11, is amended to read:
87.9    Subd. 5. Counties. (a) 21.05 cents per taxable ton for distributions in 2015 through
87.102023, and 26.05 cents per taxable ton for distributions beginning in 2024 is allocated
87.11to counties to be distributed, based upon certification by the commissioner of revenue,
87.12under paragraphs (b) to (d).
87.13    (b) 10.525 cents per taxable ton shall be distributed to the county in which the
87.14taconite is mined or quarried or in which the concentrate is produced, less any amount
87.15which is to be distributed pursuant to paragraph (c). The apportionment formula prescribed
87.16in subdivision 2 is the basis for the distribution.
87.17    (c) If an electric power plant owned by and providing the primary source of power for
87.18a taxpayer mining and concentrating taconite is located in a county other than the county
87.19in which the mining and the concentrating processes are conducted, one cent per taxable
87.20ton of the tax distributed to the counties pursuant to paragraph (b) and imposed on and
87.21collected from such taxpayer shall be paid to the county in which the power plant is located.
87.22    (d) 10.525 cents per taxable ton for distributions in 2015 through 2023, and 15.525
87.23cents per taxable ton for distributions beginning in 2024 shall be paid to the county from
87.24which the taconite was mined, quarried or concentrated to be deposited in the county road
87.25and bridge fund. If the mining, quarrying and concentrating, or separate steps in any of
87.26those processes are carried on in more than one county, the commissioner shall follow the
87.27apportionment formula prescribed in subdivision 2.
87.28EFFECTIVE DATE.This section is effective for distributions beginning in 2015
87.29and thereafter.

87.30    Sec. 5. Minnesota Statutes 2012, section 298.28, subdivision 7a, as added by Laws
87.312014, chapter 150, article 6, section 13, is amended to read:
87.32    Subd. 7a. Iron Range school consolidation and cooperatively operated school
87.33account. The following amounts must be allocated to the Iron Range Resources and
88.1Rehabilitation Board to be deposited in the Iron Range school consolidation and
88.2cooperatively operated school account that is hereby created:
88.3(1) (i) for distributions in 2015 through 2023, ten cents per taxable ton of the tax
88.4imposed under section 298.24; and (ii) for distributions beginning in 2024, five cents per
88.5taxable ton of the tax imposed under section 298.24;
88.6(2) the amount as determined under section 298.17, paragraph (b), clause (3); and
88.7(3) for distributions in 2015 through 2017, an amount equal to two-thirds of the
88.8increased tax proceeds attributable to the increase in the implicit price deflator as provided
88.9in section 298.24, subdivision 1 (i) for distributions in 2015, an amount equal to two-thirds
88.10of the increased tax proceeds attributable to the increase in the implicit price deflator as
88.11provided in section 298.24, subdivision 1, with the remaining one-third to be distributed to
88.12the Douglas J. Johnson Economic Protection Trust Fund;
88.13(ii) for distributions in 2016, an amount equal to two-thirds of the sum of the
88.14increased tax proceeds attributable to the increase in the implicit price deflator as provided
88.15in section 298.24, subdivision 1, for distribution years 2015 and 2016, with the remaining
88.16one-third to be distributed to the Douglas J. Johnson Economic Protection Trust Fund; and
88.17(iii) for distributions in 2017, an amount equal to two-thirds of the sum of the
88.18increased tax proceeds attributable to the increase in the implicit price deflator as provided
88.19in section 298.24, subdivision 1, for distribution years 2015, 2016, and 2017, with the
88.20remaining one-third to be distributed to the Douglas J. Johnson Economic Protection
88.21Trust Fund; and
88.22(4) any other amount as provided by law.
88.23Expenditures from this account shall be made only to provide disbursements to
88.24assist school districts with the payment of bonds that were issued for qualified school
88.25projects, or for any other school disbursement as approved by the Iron Range Resources
88.26and Rehabilitation Board. For purposes of this section, "qualified school projects" means
88.27school projects within the taconite assistance area as defined in section 273.1341, that were
88.28(1) approved, by referendum, after December 7, 2009 April 3, 2006; and (2) approved by
88.29the commissioner of education pursuant to section 123B.71.
88.30No expenditure under this section shall be made unless approved by seven members
88.31of the Iron Range Resources and Rehabilitation Board.
88.32EFFECTIVE DATE.This section is effective for distributions beginning in 2015
88.33and thereafter.

88.34    Sec. 6. Minnesota Statutes 2013 Supplement, section 298.28, subdivision 10, as
88.35amended by Laws 2014, chapter 150, article 6, section 15, is amended to read:
89.1    Subd. 10. Increase. (a) Except as provided in paragraph (b), for distributions
89.2in 2000 through 2014 and for distributions in 2018 and subsequent years, the amount
89.3determined under subdivision 9 shall be increased in the same proportion as the increase
89.4in the implicit price deflator as provided in section 298.24, subdivision 1. Beginning with
89.5distributions in 2018, the amount determined under subdivision 6, paragraph (a), shall be
89.6increased in the same proportion as the increase in the implicit price deflator as provided
89.7in section 298.24, subdivision 1.
89.8(b) For distributions in 2005 and subsequent years, an amount equal to the increased
89.9tax proceeds attributable to the increase in the implicit price deflator as provided in
89.10section 298.24, subdivision 1, for taxes paid in 2005, except for the amount of revenue
89.11increases provided in subdivision 4, paragraph (d), is distributed to the grant and loan fund
89.12established in section 298.2961, subdivision 4.
89.13(c) For distributions in 2015 through 2017, an amount equal to two-thirds of the
89.14increased tax proceeds attributable to the increase in the implicit price deflator as provided
89.15in section 298.24, subdivision 1, is distributed to the Iron Range school consolidation and
89.16cooperatively operated school account in section 298.28, subdivision 7a, with the remaining
89.17one-third to be distributed to the Douglas J. Johnson Economic Protection Trust Fund.
89.18EFFECTIVE DATE.This section is effective for distributions beginning in 2015
89.19and thereafter.

89.20    Sec. 7. Minnesota Statutes 2012, section 298.75, subdivision 2, is amended to read:
89.21    Subd. 2. Tax imposed. (a) Except as provided in paragraph (e), a county that
89.22imposes the aggregate production tax shall impose upon every operator a production tax
89.23of 21.5 cents per cubic yard or 15 cents per ton of aggregate material excavated in the
89.24county except that the county board may decide not to impose this tax if it determines
89.25that in the previous year operators removed less than 20,000 tons or 14,000 cubic yards of
89.26aggregate material from that county. The tax shall not be imposed on aggregate material
89.27excavated in the county until the aggregate material is transported from the extraction site
89.28or sold, whichever occurs first. When aggregate material is stored in a stockpile within the
89.29state of Minnesota and a public highway, road or street is not used for transporting the
89.30aggregate material, the tax shall not be imposed until either when the aggregate material
89.31is sold, or when it is transported from the stockpile site, or when it is used from the
89.32stockpile, whichever occurs first.
89.33    (b) Except as provided in paragraph (e), a county that imposes the aggregate
89.34production tax under paragraph (a) shall impose upon every importer a production tax
89.35of 21.5 cents per cubic yard or 15 cents per ton of aggregate material imported into the
90.1county. The tax shall be imposed when the aggregate material is imported from the
90.2extraction site or sold. When imported aggregate material is stored in a stockpile within
90.3the state of Minnesota and a public highway, road, or street is not used for transporting
90.4the aggregate material, the tax shall be imposed either when the aggregate material is
90.5sold, when it is transported from the stockpile site, or when it is used from the stockpile,
90.6whichever occurs first. The tax shall be imposed on an importer when the aggregate
90.7material is imported into the county that imposes the tax.
90.8    (c) If the aggregate material is transported directly from the extraction site to a
90.9waterway, railway, or another mode of transportation other than a highway, road or street,
90.10the tax imposed by this section shall be apportioned equally between the county where the
90.11aggregate material is extracted and the county to which the aggregate material is originally
90.12transported. If that destination is not located in Minnesota, then the county where the
90.13aggregate material was extracted shall receive all of the proceeds of the tax.
90.14    (d) A county, city, or town that receives revenue under this section is prohibited
90.15from imposing any additional host community fees on aggregate production within that
90.16county, city, or town.
90.17(e) A county that borders two other states and that is not contiguous to a county
90.18that imposes a tax under this section may impose the taxes under paragraphs (a) and (b)
90.19at the rate of ten cents per cubic yard or seven cents per ton. This paragraph expires
90.20December 31, 2014 2024.
90.21EFFECTIVE DATE.This section is effective the day following final enactment.

90.22    Sec. 8. Laws 2008, chapter 366, article 10, section 15, is amended to read:
90.23    Sec. 15. 2008 DISTRIBUTIONS ONLY.
90.24    For distribution in 2008 only, a special fund is established to receive 11.4 cents per ton
90.25that otherwise would be allocated under Minnesota Statutes, section 298.28, subdivision 6.
90.26If sufficient funds are not available under Minnesota Statutes, section 298.28, subdivision
90.276
, to make the payments required under this section and under Minnesota Statutes, section
90.28298.28, subdivision 6 , the remaining amount needed to total 11.4 cents per ton may be
90.29taken from funds available under Minnesota Statutes, section 298.28, subdivision 9. If
90.302008 H.F. No. 1812 is enacted and includes a provision that distributes funds that would
90.31otherwise be allocated under Minnesota Statutes, section 298.28, subdivision 6, in a
90.32manner different from the distribution required in this section, the distribution in this
90.33section supersedes the distribution set in 2008 H.F. No. 1812 notwithstanding Minnesota
90.34Statutes, section 645.26. The following amounts are allocated to St. Louis County acting
90.35as the fiscal agent for the recipients for the following specified purposes:
91.1    (1) two cents per ton must be paid to the Hibbing Economic Development Authority
91.2to retire bonds and for economic development purposes;
91.3    (2) one cent per ton must be divided among and paid in equal shares to each of the
91.4board of St. Louis County School District No. 2142, the board of Ely School District No.
91.5696, the board of Mountain Iron-Buhl School District No. 712, and the board of Virginia
91.6School District No. 706 for each to study the potential for and impact of consolidation
91.7and streamlining the operations of their school districts;
91.8    (3) 0.25 cent per ton must be paid to the city of Grand Rapids, for industrial park work;
91.9    (4) 0.65 cent per ton must be paid to the city of Aitkin, for sewer and water for
91.10housing economic development projects;
91.11    (5) 0.5 cent per ton must be paid to the city of Crosby, for well and water tower
91.12infrastructure;
91.13    (6) 0.5 cent per ton must be paid to the city of Two Harbors, for well and water
91.14tower infrastructure;
91.15    (7) 1.5 cents per ton must be paid to the city of Silver Bay to pay for health and
91.16safety and maintenance improvements at a former elementary school building that is
91.17currently owned by the city, to be used for economic development purposes;
91.18    (8) 1.5 cents per ton must be paid to St. Louis County to extend water and sewer
91.19lines from the city of Chisholm to the St. Louis County fairgrounds;
91.20    (9) 1.5 cents per ton must be paid to the White Community Hospital for debt
91.21restructuring;
91.22    (10) 0.5 cent per ton must be paid to the city of Keewatin for street, sewer, and
91.23water improvements;
91.24    (11) 0.5 cent per ton must be paid to the city of Calumet for street, sewer, and water
91.25improvements; and
91.26    (12) one cent per ton must be paid to Breitung township for sewer and water
91.27extensions associated with the development of a state park, provided that if a new state
91.28park is not established in Breitung township by July 1, 2009, the money provided in
91.29this clause must be transferred to the northeast Minnesota economic development fund
91.30established in Minnesota Statutes, section 298.2213.
91.31EFFECTIVE DATE.This section is effective the day following final enactment.
91.32Upon enactment, the city of Aitkin must release all funds under this section to St. Louis
91.33County acting as fiscal agent by July 1, 2014.

91.34    Sec. 9. Laws 2013, chapter 143, article 11, section 10, is amended to read:
91.35    Sec. 10. 2013 DISTRIBUTION ONLY.
92.1For the 2013 distribution, a special fund is established to receive 38.7 cents per ton of
92.2any excess of the balance remaining after distribution of amounts required under Minnesota
92.3Statutes, section 298.28, subdivision 6. The following amounts are allocated to St. Louis
92.4County acting as the fiscal agent for the recipients for the following specific purposes:
92.5(1) 5.1 cents per ton to the city of Hibbing for improvements to the city's water
92.6supply system;
92.7(2) 4.3 cents per ton to the city of Mountain Iron for the cost of moving utilities
92.8required as a result of actions undertaken by United States Steel Corporation;
92.9(3) 2.5 cents per ton to the city of Biwabik for improvements to the city's water supply
92.10system, payable upon agreement with ArcelorMittal to satisfy water permit conditions;
92.11(4) 2 cents per ton to the city of Tower for the Tower Marina;
92.12(5) 2.4 cents per ton to the city of Grand Rapids for an eco-friendly heat transfer
92.13system to replace aging effluent lines and for parking lot repaving;
92.14(6) 2.4 cents per ton to the city of Two Harbors for wastewater treatment plant
92.15improvements;
92.16(7) 0.9 cents per ton to the city of Ely for the sanitary sewer replacement project;
92.17(8) 0.6 cents per ton to the town of Crystal Bay for debt service of the Claire Nelson
92.18Intermodal Transportation Center;
92.19(9) 0.5 cents per ton to the Greenway Joint Recreation Board for the Coleraine
92.20hockey arena renovations;
92.21(10) 1.2 cents per ton for the West Range Regional Fire Hall and Training Center
92.22to merge the existing fire services of Coleraine, Bovey, Taconite Marble, Calumet, and
92.23Greenway Township;
92.24(11) 2.5 cents per ton to the city of Hibbing for the Memorial Building;
92.25(12) 0.7 cents per ton to the city of Chisholm for public works infrastructure;
92.26(13) 1.8 cents per ton to the Crane Lake Water and Sanitary District for sanitary
92.27sewer extension;
92.28(14) 2.5 cents per ton for the city of Buhl for the roof on the Mesabi Academy;
92.29(15) 1.2 cents per ton to the city of Gilbert for the New Jersey/Ohio Avenue project;
92.30(16) 1.5 2.0 cents per ton to the city of Cook for street improvements, business park
92.31infrastructure, and a maintenance garage;
92.32(17) 0.5 cents per ton to the city of Cook for a water line project;
92.33(18) (17) 1.8 cents per ton to the city of Eveleth to be used for Jones Street
92.34reconstruction and the city auditorium;
92.35(19) (18) 0.5 cents per ton for the city of Keewatin for an electrical substation and
92.36water line replacements;
93.1(20) (19) 3.3 cents per ton for the city of Virginia for Fourth Street North
93.2infrastructure and Franklin Park improvement; and
93.3(21) (20) 0.5 cents per ton to the city of Grand Rapids for an economic development
93.4project.
93.5EFFECTIVE DATE.This section is effective the day following final enactment.

93.6    Sec. 10. REALLOCATION OF BOND PAYMENTS.
93.7In each year subsequent to the year in which the following appropriations terminate
93.8under their terms, an amount equal to the amount payable in 2013 based upon 2012
93.9production of the terminating appropriation is appropriated from the same sources listed
93.10in this section to the Iron Range school consolidation and cooperatively operated school
93.11account under Laws 2014, chapter 150, article 6, section 13:
93.12(1) Laws 1996, chapter 412, article 5, section 21, subdivision 3, appropriation for
93.13bonds of Independent School District No. 166, Cook County;
93.14(2) Laws 1996, chapter 412, article 5, section 20, subdivision 2, appropriation for
93.15bonds of Independent School District No. 696, Ely;
93.16(3) Laws 1996, chapter 412, article 5, section 20, subdivision 2, appropriation for
93.17bonds of Independent School District No. 706, Virginia:
93.18(4) Laws 1996, chapter 412, article 5, section 20, subdivision 2, appropriation for
93.19bonds of Independent School District No. 2154, Eveleth-Gilbert;
93.20(5) Laws 1998, chapter 398, article 4, section 17, subdivision 2, appropriation for
93.21bonds of Independent School District No. 712, Mountain Iron-Buhl;
93.22(6) Laws 2000, chapter 489, article 5, section 24, subdivision 1, appropriation for
93.23bonds of Independent School District No. 695, Chisholm;
93.24(7) Laws 2000, chapter 489, article 5, section 25, subdivision 1, appropriation for
93.25bonds of Independent School District No. 316, Greenway-Coleraine;
93.26(8) Laws 2000, chapter 489, article 5, section 26, subdivision 1, appropriation for
93.27bonds of Independent School District No. 381, Lake Superior; and
93.28(9) Laws 2008, chapter 154, article 8, section 18, appropriation for bonds of
93.29Independent School District No. 2711, Mesabi East.
93.30EFFECTIVE DATE.This section is effective beginning with the distribution
93.31in 2015.

93.32    Sec. 11. 2014 DISTRIBUTION ONLY.
94.1For the 2014 distribution, a special fund is established to receive 18.84 cents per ton of
94.2any excess of the balance remaining after distribution of amounts required under Minnesota
94.3Statutes, section 298.28, subdivision 6. The following amounts are allocated to St. Louis
94.4County acting as the fiscal agent for the recipients for the following specific purposes:
94.5(1) 1.3 cents per ton to the city of Silver Bay for a water project under Highway 61;
94.6(2) 0.5 cents per ton to the city of Grand Rapids for soil and landscape remediation
94.7at the Reif Center;
94.8(3) 0.65 cents per ton to the city of LaPrairie for sewer, water, and road improvements
94.9to accommodate business expansion in the city;
94.10(4) 0.78 cents per ton to the city of Cohasset for an infrastructure project;
94.11(5) 0.39 cents per ton to Balkan Township for a salt storage building and
94.12energy-efficient cold storage building;
94.13(6) 3.0 cents per ton to the city of McKinley to construct a water line from the city
94.14of Gilbert or the city of Biwabik to the city of McKinley's distribution center in order to
94.15secure a potable water source for the city, provided that the city of McKinley secures
94.16the remainder of the project costs from other sources, and expires three years following
94.17the date of distribution;
94.18(7) 6.5 cents per ton to the Iron Range Resources and Rehabilitation Board for
94.19township block grants to be distributed by the board;
94.20(8) 0.5 cents per ton to the city of Marble for a water main and looping project;
94.21(9) 0.65 cents per ton to the city of Nashwauk for an infrastructure project;
94.22(10) 0.35 cents per ton to the city of Babbitt for demolition of a public building;
94.23(11) 0.65 cents per ton to the city of Hoyt Lakes for a storm water project;
94.24(12) 0.65 cents per ton to the city of Aurora for an infrastructure project;
94.25(13) 0.65 cents per ton to the town of Silver Creek for an infrastructure project;
94.26(14) 0.5 cents per ton to the city of Calumet for an infrastructure project;
94.27(15) 0.5 cents per ton to Nashwauk Township for the Nashwauk town hall;
94.28(16) 0.5 cents per ton to the city of Biwabik for emergency repair of a wastewater
94.29treatment project;
94.30(17) 0.47 cents per ton to the city of Cuyuna for improvements to city properties and
94.31facilities, including construction, electrical, water, sewer, and site preparation; and
94.32(18) 0.3 cents per ton to Morse Township for a recreational trail.
94.33EFFECTIVE DATE.This section is effective for the 2014 distribution, and all
94.34payments must be made separately and within ten days of the date of the August 2014
94.35payment.

95.1ARTICLE 6
95.2LOCAL DEVELOPMENT

95.3    Section 1. [383A.155] HOUSING IMPROVEMENT AREAS.
95.4    Subdivision 1. Powers of a housing improvement authority. The Ramsey County
95.5Housing and Redevelopment Authority shall have the powers of a city under sections
95.6428A.11 to 428A.21 to establish housing improvement areas in Ramsey County.
95.7    Subd. 2. Definitions. (a) For purposes of exercising the powers in sections 428A.11
95.8to 428A.21, references in those sections to the terms in paragraphs (b) to (e) have the
95.9meanings given them for purposes of this section.
95.10(b) "Mayor" means the chair of the Ramsey County Housing and Redevelopment
95.11Authority.
95.12(c) "Council" or "governing body of the city" means the Ramsey County Housing
95.13and Redevelopment Authority.
95.14(d) "City clerk" means the person designated by the Ramsey County Housing and
95.15Redevelopment Authority to carry out the duties of the city clerk under sections 428A.11
95.16to 428A.21.
95.17(e) "Enabling ordinance" means a resolution adopted under subdivision 3 by the
95.18Ramsey County Housing and Redevelopment Authority.
95.19    Subd. 3. Establishment of housing improvement areas. The Ramsey County
95.20Housing and Redevelopment Authority may adopt a resolution establishing one or
95.21more housing improvement areas within the county under this section. The Ramsey
95.22County Housing and Redevelopment Authority shall send a copy of each petition for the
95.23establishment of a housing improvement area to the city in which the proposed housing
95.24improvement area is located. The public hearings under sections 428A.13 and 428A.14
95.25may be held at the times and places determined by the Ramsey County Housing and
95.26Redevelopment Authority, except that they must be held at least 30 days after the date the
95.27applicable petition was sent to the city. If the city council adopts a resolution opposing
95.28the establishment within 30 days of the date the copy of the petition was sent to the city
95.29under this subdivision, the Ramsey County Housing and Redevelopment Authority may
95.30not establish the proposed housing improvement area.
95.31    Subd. 4. Applicability. Except as otherwise provided in this section, sections
95.32428A.11 to 428A.21 apply to the establishment of a housing improvement area by the
95.33Ramsey County Housing and Redevelopment Authority.
95.34EFFECTIVE DATE.This section is effective the day following final enactment.

96.1    Sec. 2. Minnesota Statutes 2012, section 383D.41, is amended by adding a subdivision
96.2to read:
96.3    Subd. 11. Tax credit allocation threshold criteria. (a) In addition to the projects
96.4described in section 462A.222, subdivision 3, paragraph (d), the Dakota County
96.5Community Development Agency may allocate tax credits in the first round for up to three
96.6projects of the following type: new construction or substantial rehabilitation multifamily
96.7housing projects that are not restricted to persons who are 55 years of age or older and that
96.8are located within one of the following areas at the time a reservation for tax credits is made:
96.9(1) an area within one-half mile of a completed or planned light rail transit way, bus
96.10rapid transit way, or commuter rail station;
96.11(2) an area within one-fourth mile from any stop along a high-frequency local bus line;
96.12(3) an area within one-half mile from a bus stop or station on a high-frequency
96.13express route;
96.14(4) an area within one-half mile from a park and ride lot; or
96.15(5) an area within one-fourth mile of a high-service public transportation fixed
96.16route stop.
96.17(b) For purposes of this section, the following terms have the meaning given them:
96.18(1) "high-frequency local bus line" means a local bus route providing service at
96.19least every 15 minutes and running between 6:00 a.m. and 7:00 p.m. on weekdays and
96.20between 9:00 a.m. and 6:00 p.m. on Saturdays;
96.21(2) "high-frequency express route" means an express route with bus service
96.22providing six or more trips during at least one of the peak morning hours between 6:00
96.23a.m. and 9:00 a.m. and every ten minutes during the peak morning hour; and
96.24(3) "high-service public transportation fixed route stop" means a stop serviced
96.25between 6:00 a.m. and 7:00 p.m. on weekdays and 9:00 a.m. and 6:00 p.m. on Saturdays
96.26and with service approximately every 30 minutes during that time.
96.27EFFECTIVE DATE.This section is effective beginning with the 2015 allocation of
96.28tax credit.

96.29    Sec. 3. Minnesota Statutes 2012, section 469.1763, subdivision 3, is amended to read:
96.30    Subd. 3. Five-year rule. (a) Revenues derived from tax increments are considered
96.31to have been expended on an activity within the district under subdivision 2 only if one
96.32of the following occurs:
96.33(1) before or within five years after certification of the district, the revenues are
96.34actually paid to a third party with respect to the activity;
97.1(2) bonds, the proceeds of which must be used to finance the activity, are issued and
97.2sold to a third party before or within five years after certification, the revenues are spent
97.3to repay the bonds, and the proceeds of the bonds either are, on the date of issuance,
97.4reasonably expected to be spent before the end of the later of (i) the five-year period, or
97.5(ii) a reasonable temporary period within the meaning of the use of that term under section
97.6148(c)(1) of the Internal Revenue Code, or are deposited in a reasonably required reserve
97.7or replacement fund;
97.8(3) binding contracts with a third party are entered into for performance of the
97.9activity before or within five years after certification of the district and the revenues are
97.10spent under the contractual obligation;
97.11(4) costs with respect to the activity are paid before or within five years after
97.12certification of the district and the revenues are spent to reimburse a party for payment
97.13of the costs, including interest on unreimbursed costs; or
97.14(5) expenditures are made for housing purposes as permitted by subdivision 2,
97.15paragraphs (b) and (d), or for public infrastructure purposes within a zone as permitted
97.16by subdivision 2, paragraph (e).
97.17(b) For purposes of this subdivision, bonds include subsequent refunding bonds if
97.18the original refunded bonds meet the requirements of paragraph (a), clause (2).
97.19(c) For a redevelopment district or a renewal and renovation district certified after
97.20June 30, 2003, and before April 20, 2009, the five-year periods described in paragraph (a)
97.21are extended to ten years after certification of the district. For a redevelopment district
97.22certified after April 20, 2009, and before June 30, 2012, the five-year periods described in
97.23paragraph (a) are extended to eight years after certification of the district. This extension is
97.24provided primarily to accommodate delays in development activities due to unanticipated
97.25economic circumstances.
97.26EFFECTIVE DATE.This section is effective for districts for which the request for
97.27certification was made after April 20, 2009.

97.28    Sec. 4. Minnesota Statutes 2012, section 469.177, subdivision 3, is amended to read:
97.29    Subd. 3. Tax increment, relationship to chapters 276A and 473F. (a) Unless the
97.30governing body elects pursuant to paragraph (b) the following method of computation
97.31shall apply to a district other than an economic development district for which the request
97.32for certification was made after June 30, 1997:
97.33(1) The original net tax capacity and the current net tax capacity shall be determined
97.34before the application of the fiscal disparity provisions of chapter 276A or 473F. Where
97.35the original net tax capacity is equal to or greater than the current net tax capacity, there is
98.1no captured net tax capacity and no tax increment determination. Where the original net
98.2tax capacity is less than the current net tax capacity, the difference between the original
98.3net tax capacity and the current net tax capacity is the captured net tax capacity. This
98.4amount less any portion thereof which the authority has designated, in its tax increment
98.5financing plan, to share with the local taxing districts is the retained captured net tax
98.6capacity of the authority.
98.7(2) The county auditor shall exclude the retained captured net tax capacity of the
98.8authority from the net tax capacity of the local taxing districts in determining local taxing
98.9district tax rates. The local tax rates so determined are to be extended against the retained
98.10captured net tax capacity of the authority as well as the net tax capacity of the local taxing
98.11districts. The tax generated by the extension of the lesser of (A) the local taxing district
98.12tax rates or (B) the original local tax rate to the retained captured net tax capacity of the
98.13authority is the tax increment of the authority.
98.14(b) The following method of computation applies to any economic development
98.15district for which the request for certification was made after June 30, 1997, and to any
98.16 other district for which the governing body, by resolution approving the tax increment
98.17financing plan pursuant to section 469.175, subdivision 3, elects:
98.18(1) The original net tax capacity shall be determined before the application of the
98.19fiscal disparity provisions of chapter 276A or 473F. The current net tax capacity shall
98.20exclude any fiscal disparity commercial-industrial net tax capacity increase between
98.21the original year and the current year multiplied by the fiscal disparity ratio determined
98.22pursuant to section 276A.06, subdivision 7, or 473F.08, subdivision 6. Where the original
98.23net tax capacity is equal to or greater than the current net tax capacity, there is no captured
98.24net tax capacity and no tax increment determination. Where the original net tax capacity is
98.25less than the current net tax capacity, the difference between the original net tax capacity
98.26and the current net tax capacity is the captured net tax capacity. This amount less any
98.27portion thereof which the authority has designated, in its tax increment financing plan, to
98.28share with the local taxing districts is the retained captured net tax capacity of the authority.
98.29(2) The county auditor shall exclude the retained captured net tax capacity of the
98.30authority from the net tax capacity of the local taxing districts in determining local taxing
98.31district tax rates. The local tax rates so determined are to be extended against the retained
98.32captured net tax capacity of the authority as well as the net tax capacity of the local taxing
98.33districts. The tax generated by the extension of the lesser of (A) the local taxing district
98.34tax rates or (B) the original local tax rate to the retained captured net tax capacity of the
98.35authority is the tax increment of the authority.
99.1(3) An election by the governing body pursuant to paragraph (b) shall be submitted
99.2to the county auditor by the authority at the time of the request for certification pursuant to
99.3subdivision 1.
99.4(c) The method of computation of tax increment applied to a district pursuant to
99.5paragraph (a) or (b) shall remain the same for the duration of the district, except that
99.6the governing body may elect to change its election from the method of computation in
99.7paragraph (a) to the method in paragraph (b).
99.8EFFECTIVE DATE.This section is effective for districts for which the request for
99.9certification is made after June 30, 2014.

99.10    Sec. 5. Laws 2013, chapter 143, article 9, section 23, is amended to read:
99.11    Sec. 23. CITY OF BLOOMINGTON; OLD CEDAR AVENUE BRIDGE.
99.12    (a) Notwithstanding any law to the contrary, the city of Bloomington shall transfer
99.13from the tax increment financing accounts for its Tax Increment Financing District No.
99.141-C and Tax Increment Financing District No. 1-G an amount equal to the tax increment
99.15for each district that is computed under the provisions of Minnesota Statutes, section
99.16473F.08, subdivision 3c , for taxes payable in 2014 to an account or fund established for
99.17the repair, restoration, or replacement of the Old Cedar Avenue bridge for use by bicycle
99.18commuters and recreational users. The city is authorized to and must use the transferred
99.19funds to complete the repair, renovation, or replacement of the bridge.
99.20(b) Upon completion of the repair, restoration, or replacement of the bridge, the city
99.21may use any remaining funds in the account for expenditures as provided in this paragraph
99.22and that use is deemed to be a permitted use of the increments, regardless of whether it is
99.23for improvements within the project area. If the city elects to use the authority under this
99.24paragraph, the remaining funds must be spent for the following items and improvements
99.25in the following order of priority:
99.26(1) signage for the Old Cedar Avenue bridge that is consistent with the number,
99.27design, size, and placement of the city's signage for the Normandale Lake District;
99.28(2) kiosks and other wayfinding aids for users of the Old Cedar Avenue bridge and
99.29immediately adjacent parkland areas; and
99.30(3) bicycle and pedestrian trail improvements that provide access to the Old Cedar
99.31Avenue bridge.
99.32    (b) (c) No signs, plaques, or markers acknowledging or crediting donations for,
99.33sponsorships of, or naming rights may be posted on or in the vicinity of the Old Cedar
99.34Avenue bridge.
100.1EFFECTIVE DATE.This section is effective without local approval under
100.2Minnesota Statutes, section 645.023, subdivision 1, paragraph (a).

100.3    Sec. 6. CITY OF BAXTER; TAX INCREMENT FINANCING DISTRICT;
100.4PROJECT REQUIREMENT.
100.5    Subdivision 1. Addition of parcels to district. Notwithstanding Minnesota
100.6Statutes, sections 469.174, subdivision 12; 469.176, subdivision 4c; or any other law to
100.7the contrary, the governing body of the city of Baxter may elect to expand the boundaries
100.8of the Isle Drive Tax Increment Financing District to include the real property described as
100.9tax parcel number 034120010010009 in the city of Baxter, Crow Wing County, Minnesota.
100.10    Subd. 2. Original tax capacity of district. Upon addition of the property described
100.11in subdivision 1 to the Isle Drive Tax Increment Financing District, the Crow Wing
100.12County auditor shall increase the original tax capacity of Isle Drive Tax Increment
100.13Financing District by the amount required by Minnesota Statutes, section 469.177, except
100.14as provided in subdivision 3.
100.15    Subd. 3. Prior planned improvements. Minnesota Statutes, section 469.177,
100.16subdivision 4, does not apply to the property described in subdivision 1 added to the Isle
100.17Drive Tax Increment Financing District.
100.18    Subd. 4. Use of increments. Tax increments and other revenues derived from any
100.19portion of the Isle Drive Tax Increment Financing District, as expanded under this section,
100.20may be used to reimburse or otherwise pay for allowable expenditures under the plan
100.21budget for the Isle Drive Tax Increment Financing District, as amended in accordance
100.22with Minnesota Statutes, section 469.175, subdivision 4.
100.23    Subd. 5. Approval and effect of modification. If the governing body of the
100.24city elects to exercise the authority provided in subdivision 1 to modify the district, the
100.25following conditions apply:
100.26(1) the city must comply with Minnesota Statutes, section 469.175, subdivision 4; and
100.27(2) beginning with the subsequent calendar year, except as otherwise provided
100.28in this section, the district is subject to the provisions of Minnesota Statutes, sections
100.29469.174 to 469.1794, as if the request for certification of the entire district was made on
100.30December 30, 2011, the date the original request for certification for the Isle Drive Tax
100.31Increment Financing District was made.
100.32EFFECTIVE DATE.This section is effective upon approval by the governing body
100.33of the city of Baxter and upon compliance by the city with Minnesota Statutes, section
100.34645.021, subdivisions 2 and 3.

101.1    Sec. 7. CITY OF EAGAN; TAX INCREMENT FINANCING.
101.2(a) Effective for taxes payable in 2015, the city of Eagan may elect to compute tax
101.3increment for the Cedar Grove Tax Increment Financing District using the current local tax
101.4rate, notwithstanding the provisions of Minnesota Statutes, section 469.177, subdivision 1a.
101.5(b) The requirements of Minnesota Statutes, section 469.1763, subdivision 3, that
101.6activities must be undertaken within a five-year period from the date of certification
101.7of a tax increment financing district, is considered to be met for the Cedar Grove Tax
101.8Increment Financing District in the city of Eagan if the activities are undertaken within 13
101.9years from the date of certification of the district.
101.10(c) Notwithstanding the provisions of Minnesota Statutes, section 469.176,
101.11subdivision 1b, or any other law to the contrary, the city of Eagan may collect tax increment
101.12from the Cedar Grove Tax Increment Financing District through December 31, 2032.
101.13EFFECTIVE DATE.Paragraphs (a) and (b) are effective upon compliance by the
101.14governing body of the city of Eagan with the requirements of Minnesota Statutes, section
101.15645.021, subdivision 3. Paragraph (c) is effective upon compliance by the governing
101.16bodies of the city of Eagan, Dakota County, and Independent School District No. 191 with
101.17the requirements of Minnesota Statutes, sections 469.1782, subdivision 2, and 645.021,
101.18subdivision 3.

101.19    Sec. 8. CITY OF EDINA; TAX INCREMENT FINANCING.
101.20    Subdivision 1. Authority to create districts. (a) The governing body of the city of
101.21Edina or its development authority may establish one or more tax increment financing
101.22housing districts in the Southeast Edina Redevelopment Project Area, as the boundaries
101.23exist on March 31, 2014.
101.24(b) The authority to request certification of districts under this section expires on
101.25June 30, 2017.
101.26    Subd. 2. Rules governing districts. (a) Housing districts established under this
101.27section are subject to the provisions of Minnesota Statutes, sections 469.174 to 469.1794,
101.28except as otherwise provided in this subdivision.
101.29(b) Notwithstanding the provisions of Minnesota Statutes, section 469.176,
101.30subdivision 1b, no increment must be paid to the authority after 20 years after receipt by
101.31the authority of the first increment from a district established under this section.
101.32(c) Notwithstanding the provisions of Minnesota Statutes, section 469.1761,
101.33subdivision 3, for a residential rental project, the city may elect to substitute "20 percent"
101.34for "40 percent" in the 40-60 test under section 142(d)(1)(B) of the Internal Revenue Code
101.35in determining the applicable income limits.
102.1(d) The provisions of Minnesota Statutes, section 469.1761, subdivision 3, apply for
102.2a 25-year period beginning on the date of certification of the district.
102.3    Subd. 3. Pooling authority. The city may elect to treat expenditures of increment
102.4from the Southdale 2 district for a housing project of a district established under this
102.5section as expenditures qualifying under Minnesota Statutes, section 469.1763, subdivision
102.62, paragraph (d): (1) without regard to whether the housing meets the requirement of a
102.7qualified building under section 42 of the Internal Revenue Code; and (2) may increase
102.8by an additional 25 percentage points the permitted amount of expenditures for activities
102.9located outside the geographic area of the district permitted under that section.
102.10EFFECTIVE DATE.This section is effective upon compliance by the governing
102.11body of the city of Edina with the requirements of Minnesota Statutes, section 645.021,
102.12subdivisions 2 and 3.

102.13    Sec. 9. CITY OF MAPLE GROVE; TAX INCREMENT FINANCING DISTRICT.
102.14    Subdivision 1. Definitions. (a) For the purposes of this section, the following terms
102.15have the meanings given them.
102.16(b) "City" means the city of Maple Grove.
102.17(c) "Project area" means the area in the city commencing at a point 130 feet East and
102.18120 feet North of the southwest corner of the Southeast Quarter of Section 23, Township
102.19119, Range 22, Hennepin County, said point being on the easterly right-of-way line of
102.20Hemlock Lane; thence northerly along said easterly right-of-way line of Hemlock Lane
102.21to a point on the west line of the east one-half of the Southeast Quarter of section 23,
102.22thence south along said west line a distance of 1,200 feet; thence easterly to the east
102.23line of Section 23, 1,030 feet North from the southeast corner thereof; thence South 74
102.24degrees East 1,285 feet; thence East a distance of 1,000 feet; thence North 59 degrees
102.25West a distance of 650 feet; thence northerly to a point on the northerly right-of-way line
102.26of 81st Avenue North, 650 feet westerly measured at right angles, from the east line of
102.27the Northwest Quarter of Section 24; thence North 13 degrees West a distance of 795
102.28feet; thence West to the west line of the Southeast Quarter of the Northwest Quarter of
102.29Section 24; thence North 55 degrees West to the south line of the Northwest Quarter of the
102.30Northwest Quarter of Section 24; thence West along said south line to the east right-of-way
102.31line of Zachary Lane; thence North along the east right-of-way line of Zachary Lane to
102.32the southwest corner of Lot 1, Block 1, Metropolitan Industrial Park 5th Addition; thence
102.33East along the south line of said Lot 1 to the northeast corner of Outlot A, Metropolitan
102.34Industrial Park 5th Addition; thence South along the east line of said Outlot A and its
102.35southerly extension to the south right-of-way line of County State-Aid Highway (CSAH)
103.1109; thence easterly along the south right-of-way line of CSAH 109 to the east line of the
103.2Northwest Quarter of the Northeast Quarter of Section 24; thence South along said east
103.3line to the north line of the South Half of the Northeast Quarter of Section 24; thence East
103.4along said north line to the westerly right-of-way line of Jefferson Highway North; thence
103.5southerly along the westerly right-of-way line of Jefferson Highway to the centerline of
103.6CSAH 130; thence continuing South along the west right-of-way line of Pilgrim Lane
103.7North to the westerly extension of the north line of Outlot A, Park North Fourth Addition;
103.8thence easterly along the north line of Outlot A, Park North Fourth Addition to the
103.9northeast corner of said Outlot A; thence southerly along the east line of said Outlot A
103.10to the southeast corner of said Outlot A; thence easterly along the south line of Lot 1,
103.11Block 1, Park North Fourth Addition to the westerly right-of-way line of State Highway
103.12169; thence southerly, southwesterly, westerly, and northwesterly along the westerly
103.13right-of-way line of State Highway 169 and the northerly right-of-way line of Interstate
103.14694 to its intersection with the southerly extension of the easterly right-of-way line of
103.15Zachary Lane North; thence northerly along the easterly right-of-way line of Zachary
103.16Lane North and its northerly extension to the north right-of-way line of CSAH 130; thence
103.17westerly, southerly, northerly, southwesterly, and northwesterly to the point of beginning
103.18and there terminating, provided that the project area includes the rights-of-way for all
103.19present and future highway interchanges abutting the area described in this paragraph.
103.20(d) "Soil deficiency district" means a type of tax increment financing district
103.21consisting of a portion of the project area in which the city finds by resolution that the
103.22following conditions exist:
103.23(1) unusual terrain or soil deficiencies that occurred over 80 percent of the acreage in
103.24the district require substantial filling, grading, or other physical preparation for use; and
103.25(2) the estimated cost of the physical preparation under clause (1), but excluding
103.26costs directly related to roads as defined in Minnesota Statutes, section 160.01, and
103.27local improvements as described in Minnesota Statutes, sections 429.021, subdivision 1,
103.28clauses (1) to (7), (11), and (12), and 430.01, exceeds the fair market value of the land
103.29before completion of the preparation.
103.30    Subd. 2. Special rules. (a) If the city elects, upon the adoption of the tax increment
103.31financing plan for a district, the rules under this section apply to a redevelopment
103.32district, renewal and renovation district, soil condition district, or soil deficiency district
103.33established by the city or a development authority of the city in the project area.
103.34(b) Prior to or upon the adoption of the first tax increment plan subject to the special
103.35rules under this subdivision, the city must find by resolution that parcels consisting
104.1of at least 80 percent of the acreage of the project area, excluding street and railroad
104.2rights-of-way, are characterized by one or more of the following conditions:
104.3(1) peat or other soils with geotechnical deficiencies that impair development of
104.4commercial buildings or infrastructure;
104.5(2) soils or terrain that require substantial filling in order to permit the development
104.6of commercial buildings or infrastructure;
104.7(3) landfills, dumps, or similar deposits of municipal or private waste;
104.8(4) quarries or similar resource extraction sites;
104.9(5) floodway; and
104.10(6) substandard buildings, within the meaning of Minnesota Statutes, section
104.11469.174, subdivision 10.
104.12(c) For the purposes of paragraph (b), clauses (1) to (5), a parcel is characterized by
104.13the relevant condition if at least 70 percent of the area of the parcel contains the relevant
104.14condition. For the purposes of paragraph (b), clause (6), a parcel is characterized by
104.15substandard buildings if substandard buildings occupy at least 30 percent of the area
104.16of the parcel.
104.17(d) The five-year rule under Minnesota Statutes, section 469.1763, subdivision 3,
104.18is extended to eight years for any district, and Minnesota Statutes, section 469.1763,
104.19subdivision 4, does not apply to any district.
104.20(e) Notwithstanding any provision to the contrary in Minnesota Statutes, section
104.21469.1763, subdivision 2, paragraph (a), not more than 40 percent of the total revenue
104.22derived from tax increments paid by properties in any district, measured over the life of
104.23the district, may be expended on activities outside the district but within the project area.
104.24(f) For a soil deficiency district:
104.25(1) increments may be collected through 20 years after the receipt by the authority of
104.26the first increment from the district;
104.27(2) increments may be used only to:
104.28(i) acquire parcels on which the improvements described in item (ii) will occur;
104.29(ii) pay for the cost of correcting the unusual terrain or soil deficiencies and the
104.30additional cost of installing public improvements directly caused by the deficiencies; and
104.31(iii) pay for the administrative expenses of the authority allocable to the district; and
104.32(3) any parcel acquired with increments from the district must be sold at no less
104.33than their fair market value.
104.34(g) Increments spent for any infrastructure costs, whether inside a district or outside
104.35a district but within the project area, are deemed to satisfy the requirements of Minnesota
104.36Statutes, section 469.176, subdivision 4j.
105.1(h) The authority to approve tax increment financing plans to establish tax increment
105.2financing districts under this section expires June 30, 2020.
105.3EFFECTIVE DATE.This section is effective upon compliance with Minnesota
105.4Statutes, section 645.021, subdivision 3.

105.5    Sec. 10. CITY OF MOUND; TAX INCREMENT FINANCING.
105.6The requirements of Minnesota Statutes, section 469.1763, subdivision 3, that
105.7activities must be undertaken within a five-year period from the date of certification of
105.8a tax increment financing district, are considered to be met for the Mound Harbor Tax
105.9Increment Financing District administered by the Housing and Redevelopment Authority
105.10in and for the city of Mound if the activities are undertaken within 13 years from the
105.11date of certification of the district.
105.12EFFECTIVE DATE.The section is effective upon compliance by the governing
105.13body of the city of Mound with the requirements of Minnesota Statutes, section 645.021,
105.14subdivisions 2 and 3.

105.15    Sec. 11. CITY OF NORTH ST. PAUL; TAX INCREMENT FINANCING;
105.16PARCELS DEEMED OCCUPIED.
105.17(a) If the city of North St. Paul authorizes the creation of a redevelopment tax
105.18increment financing district under Minnesota Statutes, section 469.174, subdivision 10,
105.19parcel number 122922330059 is deemed to meet the requirements of Minnesota Statutes,
105.20section 469.174, subdivision 10, paragraph (d), notwithstanding any contrary provisions
105.21of that paragraph, if the following conditions are met:
105.22(1) buildings located on the parcel were demolished after the city of North St. Paul
105.23adopted a resolution under Minnesota Statutes, section 469.174, subdivision 10, paragraph
105.24(d), clause (3);
105.25(2) the buildings were removed either by the city of North St. Paul or by the owner
105.26of the property by entering into a development agreement; and
105.27(3) the request for certification of the parcel as part of a district is filed with the
105.28county auditor by December 31, 2017.
105.29(b) The city of North St. Paul may elect to use the current value for purposes of
105.30calculating original net tax capacity for the parcels deemed occupied under paragraph (a),
105.31notwithstanding the provisions of Minnesota Statutes, sections 469.174, subdivision 10,
105.32paragraph (d), and 469.177, subdivision 1, paragraph (f).
106.1EFFECTIVE DATE.This section is effective upon compliance by the governing
106.2body of the city of North St. Paul with the requirements of Minnesota Statutes, section
106.3645.021, subdivisions 2 and 3.

106.4    Sec. 12. CITY OF SAVAGE; TAX INCREMENT FINANCING DISTRICT.
106.5    Subdivision 1. Definitions. (a) For the purposes of this section, the following terms
106.6have the meanings given them.
106.7(b) "City" means the city of Savage.
106.8(c) "Project area" means parcel numbers 26-931-023-0, 26-931-022-0, 26-931-039-0,
106.926-931-041-0, 26-931-018-1, 26-931-043-0, 26-931-020-0, 26-931-021-0, 26-931-035-0,
106.1026-931-040-0, 26-931-036-0, 26-931-037-0, 26-931-038-0, and 26-931-0310.
106.11(d) "Soil deficiency district" means a type of tax increment financing district
106.12consisting of a portion of the project area in which the city finds by resolution that the
106.13following conditions exist:
106.14(1) unusual terrain or soil deficiencies that occurred over 80 percent of the acreage in
106.15the district require substantial filling, grading, or other physical preparation for use; and
106.16(2) the estimated cost of the physical preparation under clause (1), but excluding
106.17costs directly related to roads as defined in Minnesota Statutes, section 160.01, and
106.18local improvements as described in Minnesota Statutes, sections 429.021, subdivision 1,
106.19clauses (1) to (7), (11), and (12), and 430.01, exceeds the fair market value of the land
106.20before completion of the preparation.
106.21    Subd. 2. Special rules. (a) If the city elects, upon the adoption of the tax increment
106.22financing plan for a district, the rules under this section apply to a redevelopment
106.23district, renewal and renovation district, soil condition district, or soil deficiency district
106.24established by the city or a development authority of the city in the project area.
106.25(b) Prior to or upon the adoption of the first tax increment plan subject to the special
106.26rules under this subdivision, the city must find by resolution that parcels consisting
106.27of at least 80 percent of the acreage of the project area, excluding street and railroad
106.28rights-of-way, are characterized by one or more of the following conditions:
106.29(1) peat or other soils with geotechnical deficiencies that impair development of
106.30commercial buildings or infrastructure;
106.31(2) soils or terrain that require substantial filling in order to permit the development
106.32of commercial buildings or infrastructure;
106.33(3) landfills, dumps, or similar deposits of municipal or private waste;
106.34(4) quarries or similar resource extraction sites;
106.35(5) floodway; and
107.1(6) substandard buildings, within the meaning of Minnesota Statutes, section
107.2469.174, subdivision 10.
107.3(c) For the purposes of paragraph (b), clauses (1) to (5), a parcel is characterized by
107.4the relevant condition if at least 70 percent of the area of the parcel contains the relevant
107.5condition. For the purposes of paragraph (b), clause (6), a parcel is characterized by
107.6substandard buildings if substandard buildings occupy at least 30 percent of the area
107.7of the parcel.
107.8(d) The five-year rule under Minnesota Statutes, section 469.1763, subdivision 3,
107.9is extended to eight years for any district, and Minnesota Statutes, section 469.1763,
107.10subdivision 4, does not apply to any district.
107.11(e) Notwithstanding any provision to the contrary in Minnesota Statutes, section
107.12469.1763, subdivision 2, paragraph (a), not more than 40 percent of the total revenue
107.13derived from tax increments paid by properties in any district, measured over the life of
107.14the district, may be expended on activities outside the district but within the project area.
107.15(f) For a soil deficiency district:
107.16(1) increments may be collected through 20 years after the receipt by the authority of
107.17the first increment from the district;
107.18(2) increments may be used only to:
107.19(i) acquire parcels on which the improvements described in item (ii) will occur;
107.20(ii) pay for the cost of correcting the unusual terrain or soil deficiencies and the
107.21additional cost of installing public improvements directly caused by the deficiencies; and
107.22(iii) pay for the administrative expenses of the authority allocable to the district; and
107.23(3) any parcel acquired with increments from the district must be sold at no less
107.24than their fair market value.
107.25(g) Increments spent for any infrastructure costs, whether inside a district or outside
107.26a district but within the project area, are deemed to satisfy the requirements of Minnesota
107.27Statutes, section 469.176, subdivision 4j.
107.28(h) The authority to approve tax increment financing plans to establish tax increment
107.29financing districts under this section expires June 30, 2020.
107.30EFFECTIVE DATE.This section is effective upon compliance with Minnesota
107.31Statutes, section 645.021, subdivision 3.

107.32    Sec. 13. SHOREVIEW TAX INCREMENT FINANCING PILOT PROJECT.
107.33    Subdivision 1. Authority to establish districts. (a) The governing body of the city
107.34of Shoreview or a development authority it designates may establish not more than three
107.35economic development tax increment financing districts in the city subject to the special
108.1rules under this section. The purpose of these districts is the retention and expansion of
108.2existing businesses in the city and the attraction of new business to the state to create and
108.3retain high paying jobs.
108.4(b) The authority to establish or approve the tax increment financing plans and
108.5request certification for districts under this section expires on June 30, 2019.
108.6    Subd. 2. Qualified businesses. For purposes of this section, a "qualified business"
108.7must satisfy the following requirements:
108.8(1) the business must qualify under one of the following when the tax increment
108.9financing plan is approved:
108.10(i) it operates at a location in the city of Shoreview;
108.11(ii) it does not have substantial operations in Minnesota; or
108.12(iii) the assistance is provided for relocation of a portion of the business's operation
108.13from another state;
108.14(2) the expansion or location of the operations of the business in the city, as
108.15provided in the business subsidy agreement under Minnesota Statues, sections 116J.993 to
108.16116J.995, will result in an increase in manufacturing, research, service, or professional
108.17jobs, at least 75 percent of which pay an average wage or salary that is equal to or greater
108.18than 25 percent of the median wage or salary for all jobs within the metropolitan area; and
108.19(3) the business is not engaged in making retail sales or in providing other services,
108.20such as legal, medical, accounting, financial, entertainment, or similar services, to third
108.21parties at the location receiving assistance.
108.22    Subd. 3. Applicable rules. (a) Unless otherwise stated, the provisions of Minnesota
108.23Statutes, sections 469.174 to 469.1794, apply to districts established under this section.
108.24(b) Notwithstanding the provisions of section 469.176, subdivision 1b, the duration
108.25limit for districts created under this section is 12 years after the receipt of the first increment.
108.26(c) The provisions of Minnesota Statutes, section 469.176, subdivision 4c, apply
108.27to determining the permitted uses of increments from the districts with the following
108.28exceptions:
108.29(1) any building and facilities must be for a qualified business;
108.30(2) the building and facilities must not be used by the qualified business or its
108.31lessees or tenants to relocate operations from another location in this state outside of the
108.32city of Shoreview;
108.33(3) the 15 percent limit in subdivision 4c, paragraph (a), is increased to 25 percent; and
108.34(4) the city or development authority may elect to deposit up to 20 percent of the
108.35increments in the fund established under subdivision 4. If the city elects to use this
109.1authority, all of the remaining increments must be expended for administrative expenses
109.2or for activities within the district under Minnesota Statutes, section 469.1763.
109.3(d) The governing body of the city may elect by resolution to determine the
109.4original and current net tax capacity of a district established under this section using the
109.5computation under Minnesota Statutes, section 469.177, subdivision 3, paragraph (a) or (b).
109.6    Subd. 4. Business retention and expansion fund. (a) The city may establish a
109.7business retention and expansion fund and deposit in the fund:
109.8(1) increments as provided under subdivision 3, paragraph (c), clause (4); and
109.9(2) increments from a district for which the request for certification of the district
109.10was made prior to April 30, 1990, if the amount necessary to meet all of the debt and other
109.11obligations incurred for that district has been received by the city.
109.12(b) Amounts in the fund may be expended to assist qualified businesses, as permitted
109.13under subdivisions 2 and 3, and are not otherwise subject to the restrictions in Minnesota
109.14Statutes, sections 469.174 to 469.1794.
109.15EFFECTIVE DATE.This section is effective upon compliance by the governing
109.16body of the city of Shoreview with the requirements of Minnesota Statutes, section
109.17645.021, subdivision 3.

109.18    Sec. 14. WORKFORCE HOUSING GRANTS PILOT PROGRAM.
109.19    Subdivision 1. Establishment. The commissioner of employment and economic
109.20development shall establish a workforce housing grants pilot program to award grants to a
109.21city to be used for financing costs related to the construction of or financing for market
109.22rate residential rental properties.
109.23    Subd. 2. Definitions. For purposes of this section:
109.24(1) "local unit of government" means a home rule charter or statutory city or county;
109.25(2) "qualified city" means a home rule charter or statutory city with a population
109.26exceeding 1,500 located in Roseau County or Pennington County;
109.27(3) "qualified expenditure" means expenditures for the acquisition of property,
109.28construction of improvements, provisions of loans or subsidies, grants, interest rate
109.29subsidies, public infrastructure, and related financing costs for market rate rental
109.30residential rental properties; and
109.31(4) "market rate residential rental properties" means properties that are rented at
109.32market value and excludes: (i) properties constructed with financial assistance requiring
109.33the property to be occupied by residents that meet income limits under federal or state
109.34law of initial occupancy; and (ii) properties constructed with federal, state, or local flood
110.1recovery assistance, regardless of whether that assistance imposed income limits as a
110.2condition of receiving assistance.
110.3    Subd. 3. Application. The commissioner must develop forms and procedures
110.4for soliciting and reviewing application for grants under this section. At a minimum, a
110.5city must include in its application a resolution of its governing body certifying that the
110.6matching amount as required under this section is available and committed.
110.7    Subd. 4. Program requirements. The commissioner shall not award a grant to a
110.8city under this section until the following determinations are made:
110.9(1) the average vacancy rate for rental housing located in the city, and in any city
110.10located within 15 miles or less of the boundaries of the city, has been five percent or
110.11less for at least a two-year period;
110.12(2) one or more businesses located in the city, or within 15 miles of the city, that
110.13employ a minimum of twenty full-time equivalent employees in aggregate have provided
110.14a written statement to the city indicating that the lack of available rental housing has
110.15impeded their ability to recruit and hire employees;
110.16(3) the city is located in Roseau County or Pennington County and has a population
110.17exceeding 1,500;
110.18(4) fewer than five market rate residential units per 1,000 residents were constructed
110.19in the city in each of the last ten years; and
110.20(5) the city certifies that the grants will be used for qualified expenditures for the
110.21development of rental housing to serve employees of businesses located in the city
110.22or surrounding area.
110.23    Subd. 5. Allocation. The amount of a grant may not exceed the lesser of $400,000
110.24or ten percent of the rental housing development project cost. The commissioner shall not
110.25award a grant to a city without certification by the city that the amount of the grant shall be
110.26matched by a local unit of government, business, or nonprofit organization.
110.27    Subd. 6. Report. By January 15, 2016, the city must submit a report to the chairs and
110.28ranking minority members of the senate and house of representatives committees having
110.29jurisdiction over taxes and workforce development specifying the projects that received
110.30grants under this section and the specific purposes for which the grant funds were used.
110.31EFFECTIVE DATE.This section is effective the day following final enactment.

110.32    Sec. 15. APPROPRIATION.
110.33$627,000 in fiscal year 2015 is appropriated from the general fund to the
110.34commissioner of employment and economic development to make grants under the
110.35workforce housing grants pilot program in section 14. The base for fiscal year 2016 is
111.1$1,373,000 and is available until June 30, 2018. The base for fiscal year 2017 is $0. Of
111.2these amounts, the commissioner of employment and economic development may use up
111.3to five percent for administrative expenses.

111.4ARTICLE 7
111.5LEWIS AND CLARK REGIONAL WATER SYSTEM PROJECT

111.6    Section 1. [469.352] LEWIS AND CLARK WATER PROJECT BONDING.
111.7    Subdivision 1. Authority; aggregate limit. (a) The governing body of a
111.8municipality may, by resolution, issue obligations under chapter 475 to acquire land or
111.9interests in land for, and to design, engineer, and construct pipeline and other facilities and
111.10infrastructure necessary to complete the Lewis and Clark Regional Water System Project.
111.11(b) The maximum amount of bonds that may be issued under this section is limited
111.12to an aggregate principal amount of $45,000,000, plus any costs of issuance and amounts
111.13to be deposited into a debt service or reserve account. The Lewis and Clark Joint Powers
111.14Board shall allocate the limit among the municipalities designated in subdivision 2.
111.15    Subd. 2. Municipalities. For purposes of this section, "municipality" or
111.16"municipalities" means any of the following governmental units:
111.17(1) the city of Luverne;
111.18(2) the city of Worthington;
111.19(3) Nobles County; and
111.20(4) Rock County.
111.21    Subd. 3. Application of chapter 475 limits. (a) Notwithstanding section 475.58 or
111.22any other law to contrary, obligations under this section, including general obligations,
111.23may be issued without obtaining the approval of the electors.
111.24(b) Notwithstanding section 475.53 or any other law to the contrary, obligations
111.25issued under this section are not subject to any limitations on net debt.
111.26    Subd. 4. Payment allocation. The joint powers board may agree to allocate the
111.27responsibility of each of its members and each municipality to pay obligations issued
111.28under this section. One-half of any federal grants and aid received to fund the project in
111.29any year shall be used to proportionately reduce responsibility to pay obligations under
111.30this subdivision.
111.31EFFECTIVE DATE.This section is effective the day following final enactment
111.32without local approval under the provisions of Minnesota Statutes, section 645.023.

112.1    Sec. 2. [477A.20] DEBT SERVICE AID; LEWIS AND CLARK JOINT POWERS
112.2BOARD.
112.3(a) The Lewis and Clark Joint Powers Board is eligible to receive an aid distribution
112.4under this section equal to (1) the principal and interest payable in the succeeding calendar
112.5year for bonds issued under section 469.352 minus the sum of (2) the combined adjusted
112.6net tax capacity of Rock County and Nobles County for the assessment year prior to the
112.7aid payable year multiplied by 1.5 percent and (3) 50 percent of any federal aid received to
112.8fund the project in the calendar year. The board shall certify to the commissioner of revenue
112.9the principal and interest due in the succeeding calendar year by June 1 of the aid payable
112.10year. The commissioner of revenue shall calculate the aid payable under this section and
112.11certify the amount payable before July 1 of the aid distribution year. The commissioner
112.12shall pay the aid under this section to the board at the times specified for payments of local
112.13government aid in section 477A.015. An amount sufficient to pay the state aid authorized
112.14under this section is annually appropriated to the commissioner from the general fund.
112.15(b) The board must allocate the aid to the municipalities issuing bonds under section
112.16469.352 in proportion to their principal and interest payments.
112.17(c) If the deduction under paragraph (a), clause (3), eliminates the aid payment under
112.18this section in a calendar year, then the excess must be used to reduce the principal and
112.19interest in the succeeding year or years used to calculate aid under paragraph (a).
112.20(d) If federal grants and aid received for the project, not deducted under paragraph
112.21(a), clause (3), exceed the total debt service payments for bonds issued under section
112.22469.352, other than payments made with state aid under this section, the joint powers
112.23board must repay any excess to the commissioner of revenue for deposit in the general
112.24fund. The repayment may not exceed the sum of state aid payments under this section and
112.25any other grants made by the state for the project.
112.26(e) This section expires at the earlier of January 1, 2039, or when the bonds
112.27authorized under section 469.352 have been paid or defeased.
112.28EFFECTIVE DATE.This section is effective beginning with aids payable in 2015.

112.29    Sec. 3. Laws 2005, First Special Session chapter 3, article 5, section 44, subdivision 3,
112.30is amended to read:
112.31    Subd. 3. Use of revenues. (a) Revenues received from taxes authorized by
112.32subdivisions 1 and 2 must be used by the city to pay the cost of collecting and
112.33administering the taxes and to pay for the costs of a community center complex and
112.34to make renovations to the Memorial Auditorium. Authorized expenses include, but
112.35are not limited to, acquiring property and paying construction expenses related to these
113.1improvements, and paying debt service on bonds or other obligations issued to finance
113.2acquisition and construction of these improvements.
113.3    (b) Notwithstanding Minnesota Statutes, section 297A.99, subdivisions 2 and 3, if
113.4the city decides to extend the taxes in subdivisions 1 and 2, as allowed under subdivision
113.55, paragraph (b), the city must use any amounts in excess of the amounts necessary to
113.6meet the obligations under paragraph (a) to pay the city's share of debt service on bonds
113.7issued under Minnesota Statutes, section 469.352, to fund the Lewis and Clark Regional
113.8Water System Project.
113.9EFFECTIVE DATE.This section is effective the day after the governing body of
113.10the city of Worthington and its chief clerical officer comply with Minnesota Statutes,
113.11section 645.021, subdivisions 2 and 3.

113.12    Sec. 4. Laws 2005, First Special Session chapter 3, article 5, section 44, subdivision 5,
113.13is amended to read:
113.14    Subd. 5. Termination of taxes. (a) The taxes imposed under subdivisions 1 and
113.152 expire at the earlier of (1) ten years, or (2) when the city council determines that the
113.16amount of revenue received from the taxes to pay for the projects under subdivision 3
113.17equals or exceeds $6,000,000 plus the additional amount needed to pay the costs related
113.18to issuance of bonds under subdivision 4, including interest on the bonds. Any funds
113.19remaining after completion of the project and retirement or redemption of the bonds shall
113.20be placed in a capital project fund of the city. The taxes imposed under subdivisions 1 and
113.212 may expire at an earlier time if the city so determines by ordinance.
113.22    (b) Notwithstanding paragraph (a), the city council may, by ordinance, extend the
113.23taxes imposed under subdivisions 1 and 2 through December 31, 2039, provided that
113.24all additional revenues that exceed those necessary to fund the projects and associated
113.25financing costs listed in subdivision 3, paragraph (a), are committed to pay debt service
113.26on bonds issued under Minnesota Statutes, section 469.352, to fund the Lewis and Clark
113.27Regional Water System Project.
113.28EFFECTIVE DATE.This section is effective the day after the governing body of
113.29the city of Worthington and its chief clerical officer comply with Minnesota Statutes,
113.30section 645.021, subdivisions 2 and 3.

113.31    Sec. 5. ROCK COUNTY LOCAL SALES TAX.
113.32(a) Notwithstanding Minnesota Statutes, sections 297A.99, 297A.993, and
113.33477A.016, or any other contrary provision of law, ordinance, or charter, and in
114.1addition to any taxes the county may impose under another law or statute, the Board
114.2of Commissioners of Rock County may, by resolution, impose a sales and use tax of
114.3up to one-half of one percent for the purposes specified in paragraph (c). Except as
114.4otherwise provided in this section, the provisions of Minnesota Statutes, section 297A.99,
114.5subdivisions
4 to 13, govern the imposition, administration, collection, and enforcement
114.6of the tax authorized under this paragraph.
114.7(b) The tax imposed under paragraph (a) must be imposed in the entire county unless
114.8the city of Luverne imposes a local sales tax at the same rate under section 7, in which
114.9case the county board of commissioners may elect to impose the tax in the portion of the
114.10county located outside of the boundaries of the city of Luverne.
114.11(c) The proceeds of any tax imposed under paragraph (a), less refunds and costs of
114.12collection, must be first used by the county to pay debt service on bonds issued under
114.13Minnesota Statutes, section 469.352, to fund the Lewis and Clark Regional Water System
114.14Project. Revenues collected in any calendar year in excess of the county obligation to pay
114.15for the county's share of the bonds issued under Minnesota Statutes, section 469.352, may
114.16be retained by the county and used for funding other capital projects within the county.
114.17(d) A tax imposed under paragraph (a) expires when the county's share of bonds issued
114.18under Minnesota Statutes, section 469.352, to fund the Lewis and Clark Regional Water
114.19System Project has been paid, or at an earlier time if approved by resolution of the board.
114.20The tax must not terminate before the county board of commissioners determines that
114.21revenues from these taxes and any other revenue source the county dedicates are sufficient
114.22to pay the county's share of the bonds issued under Minnesota Statutes, section 469.352.
114.23EFFECTIVE DATE.This section is effective the day after the governing body
114.24of Rock County and its chief clerical officer comply with Minnesota Statutes, section
114.25645.021, subdivisions 2 and 3.

114.26    Sec. 6. NOBLES COUNTY LOCAL SALES TAX.
114.27(a) Notwithstanding Minnesota Statutes, sections 297A.99, 297A.993, and
114.28477A.016, or any other contrary provision of law, ordinance, or charter, and in
114.29addition to any taxes the county may impose under another law or statute, the Board
114.30of Commissioners of Nobles County may, by resolution, impose a sales and use tax of
114.31up to one-half of one percent for the purposes specified in paragraph (c). Except as
114.32otherwise provided in this section, the provisions of Minnesota Statutes, section 297A.99,
114.33subdivisions
4 to 13, govern the imposition, administration, collection, and enforcement
114.34of the tax authorized under this paragraph.
115.1(b) The tax imposed under paragraph (a) must be imposed in the entire county unless
115.2the county imposes the tax at one-half of one percent and the local sales tax authorized
115.3under Laws 2005, chapter 3, article 5, section 44, as amended, has not expired, in which
115.4case the county board of commissioners may elect to impose the tax in the portion of the
115.5county located outside of the boundaries of the city of Worthington. If the tax authorized
115.6under Laws 2005, chapter 3, article 5, section 44, as amended, expires before the tax
115.7authorized under this section expires, the tax authorized under this section is imposed
115.8in the entire county.
115.9(c) The proceeds of any tax imposed under paragraph (a), less refunds and costs of
115.10collection, must be first used by the county to pay debt service on bonds issued under
115.11Minnesota Statutes, section 469.352, to fund the Lewis and Clark Regional Water System
115.12Project. Revenues collected in any calendar year in excess of the county obligation to pay
115.13for the county's share of the bonds issued under Minnesota Statutes, section 469.352, may
115.14be retained by the county and used for funding other capital projects within the county.
115.15(d) A tax imposed under paragraph (a) expires when the county's share of bonds issued
115.16under Minnesota Statutes, section 469.352, to fund the Lewis and Clark Regional Water
115.17System Project has been paid, or at an earlier time if approved by resolution of the board.
115.18The tax must not terminate before the county board of commissioners determines that
115.19revenues from these taxes and any other revenue source the county dedicates are sufficient
115.20to pay the county's share of the bonds issued under Minnesota Statutes, section 469.352.
115.21EFFECTIVE DATE.This section is effective the day after the governing body of
115.22Nobles County and its chief clerical officer comply with Minnesota Statutes, section
115.23645.021, subdivisions 2 and 3.

115.24    Sec. 7. CITY OF LUVERNE LOCAL SALES TAX.
115.25(a) Notwithstanding Minnesota Statutes, sections 297A.99, 297A.993, and 477A.016,
115.26or any other contrary provision of law, ordinance, or city charter, the city of Luverne may,
115.27by ordinance, impose a sales and use tax of up to one-half of one percent for the purposes
115.28specified in paragraph (b). Except as otherwise provided in this section, the provisions
115.29of Minnesota Statutes, section 297A.99, subdivisions 4 to 13, govern the imposition,
115.30administration, collection, and enforcement of the tax authorized under this paragraph.
115.31(b) The proceeds of any tax imposed under paragraph (a), less refunds and costs
115.32of collection, must be first used by the city to pay debt service on bonds issued under
115.33Minnesota Statutes, section 469.352, to fund the Lewis and Clark Regional Water System
115.34project. Revenues collected in any calendar year in excess of the city obligation to pay for
116.1debt service on bonds issued under Minnesota Statutes, section 469.352, may be retained
116.2by the city and used for funding other capital projects within the city.
116.3(c) A tax imposed under paragraph (a) expires when the city's share of bonds issued
116.4under Minnesota Statutes, section 469.352, to fund the Lewis and Clark Regional Water
116.5System Project has been made, or at an earlier time if approved by the city council. The
116.6tax must not terminate before the city council determines that revenues from this tax and
116.7any other revenue source the city dedicates are sufficient to pay the city share of debt
116.8service on bonds issued under Minnesota Statutes, section 469.352.
116.9EFFECTIVE DATE.This section is effective the day after the governing body of
116.10the city of Luverne and its chief clerical officer comply with Minnesota Statutes, section
116.11645.021, subdivisions 2 and 3.

116.12ARTICLE 8
116.13MISCELLANEOUS

116.14    Section 1. Minnesota Statutes 2013 Supplement, section 116V.03, is amended to read:
116.15116V.03 APPROPRIATION.
116.16$1,000,000 in fiscal year 2014 and each year thereafter is appropriated from the
116.17general fund to the commissioner of revenue for transfer to the agricultural project
116.18utilization account in the special revenue fund for the Agricultural Utilization Research
116.19Institute established under section 116V.01.
116.20EFFECTIVE DATE.This section is effective July 1, 2014.

116.21    Sec. 2. Minnesota Statutes 2012, section 161.14, is amended by adding a subdivision
116.22to read:
116.23    Subd. 77. Old Cedar Avenue Bridge. Minnesota state bridge number 3145, the
116.24Camelback bridge over the Minnesota River overflowage (referred to as Long Meadow
116.25Lake) constructed in 1920, is designated and named the "Old Cedar Avenue Bridge." This
116.26designation and name also applies to any renovation or reconstruction of the bridge and
116.27must be used in any publicly financed signage that refers to the bridge.
116.28EFFECTIVE DATE.This section is effective the day following final enactment.

116.29    Sec. 3. Minnesota Statutes 2012, section 270C.72, subdivision 1, is amended to read:
116.30    Subdivision 1. Tax clearance required. (a) The state or a political subdivision of
116.31the state may not issue, transfer, or renew, and must revoke, a license for the conduct of
117.1a profession, occupation, trade, or business, if the commissioner notifies the licensing
117.2authority that the applicant owes the state delinquent taxes payable to the commissioner,
117.3penalties, or interest. The commissioner may not notify the licensing authority unless the
117.4applicant taxpayer owes $500 or more in delinquent taxes, penalties, or interest, or has
117.5not filed returns. If the applicant taxpayer does not owe delinquent taxes, penalties, or
117.6interest, but has not filed returns, the commissioner may not notify the licensing authority
117.7unless the taxpayer has been given 90 days' written notice to file the returns or show
117.8that the returns are not required to be filed.
117.9(b) Within ten days after receipt of the notification from the commissioner under
117.10paragraph (a), the licensing authority must notify the license holder by certified mail of
117.11the potential revocation of the license for the applicable reason under paragraph (a).
117.12The notice must include a copy of the commissioner's notice to the licensing agency
117.13and information, in the form specified by the commissioner, on the licensee's option for
117.14receiving a tax clearance from the commissioner. The licensing authority must revoke the
117.15license 30 days after receiving the notice from the commissioner, unless it receives a tax
117.16clearance from the commissioner as provided in paragraph (c).
117.17(c) A licensing authority that has received a notice from the commissioner may
117.18issue, transfer, renew, or not revoke the applicant's license only if (a) (1) the commissioner
117.19issues a tax clearance certificate and (b) (2) the commissioner or the applicant forwards a
117.20copy of the clearance to the authority. The commissioner may issue a clearance certificate
117.21only if the applicant does not owe the state any uncontested delinquent taxes, penalties, or
117.22interest and has filed all required returns.
117.23EFFECTIVE DATE.This section is effective July 1, 2014.

117.24    Sec. 4. Minnesota Statutes 2012, section 270C.72, subdivision 3, is amended to read:
117.25    Subd. 3. Notice and hearing. (a) The commissioner, on notifying a licensing
117.26authority pursuant to subdivision 1 not to issue, transfer, or renew a license, must send a
117.27copy of the notice to the applicant. If the applicant requests, in writing, within 30 days
117.28of the date of the notice a hearing, a contested case hearing must be held. The hearing
117.29must be held within 45 days of the date the commissioner refers the case to the Office of
117.30Administrative Hearings. Notwithstanding any law to the contrary, the applicant must be
117.31served with 20 days' notice in writing specifying the time and place of the hearing and the
117.32allegations against the applicant. The notice may be served personally or by mail.
117.33(b) (a) Prior to notifying a licensing authority pursuant to subdivision 1 to revoke a
117.34license, the commissioner must send a notice to the applicant of the commissioner's intent
117.35to require revocation of the license and of the applicant's right to a hearing under paragraph
118.1(a). If the applicant requests a hearing in writing within 30 days of the date of the notice, a
118.2contested case hearing must be held. The hearing must be held within 45 days of the date
118.3the commissioner refers the case to the Office of Administrative Hearings. Notwithstanding
118.4any law to the contrary, the applicant must be served with 20 days' notice in writing
118.5specifying the time and place of the hearing and the allegations against the applicant. The
118.6notice may be served personally or by mail. A license is subject to revocation when 30
118.7days have passed following the date of the notice in this paragraph without the applicant
118.8requesting a hearing, or, if a hearing is timely requested, upon final determination of the
118.9hearing under section 14.62, subdivision 1. A license shall be revoked by the licensing
118.10authority within 30 days after receiving notice from the commissioner to revoke.
118.11(b) The commissioner may notify a licensing authority under subdivision 1 only
118.12after the requirements of paragraph (a) have been satisfied.
118.13(c) A hearing under this subdivision is in lieu of any other hearing or proceeding
118.14provided by law arising from any action taken under subdivision 1.
118.15EFFECTIVE DATE.This section is effective July 1, 2014.

118.16    Sec. 5. CARLTON COUNTY; LEVY FOR SOIL AND WATER CONSERVATION
118.17DISTRICT.
118.18    Subdivision 1. Definitions. (a) For the purposes of this section, "district" means
118.19the Carlton County Soil and Water Conservation District.
118.20(b) For the purposes of this section, "county" means Carlton County.
118.21    Subd. 2. Special project levy. Notwithstanding any law to the contrary, the county
118.22may levy ad valorem property taxes on taxable property within the area of its jurisdiction
118.23for the purposes specified in subdivision 3. The proceeds of the tax must be placed in a
118.24separate account and used only for the purposes specified in subdivision 3. The amount
118.25levied is separate from any other amount to be levied for the district by the county under
118.26Minnesota Statutes, section 103C.331, subdivision 16.
118.27    Subd. 3. Purpose; limit on levy amount. (a) The county must allocate the
118.28proceeds of any tax imposed under this section to the district solely to pay principal,
118.29interest, and any associated costs of obtaining and servicing a loan to finance the planning,
118.30constructing, and equipping of an office and storage facility for the district.
118.31(b) The maximum amount of the levy in any year may not exceed the amount
118.32necessary, after deduction of any amount remaining from the levy imposed in prior years,
118.33to pay 105 percent of the principal and interest due in the following calendar year and
118.34through July 1 of the next year.
118.35    Subd. 4. Expiration. (a) This section expires:
119.1(1) following the final payment of principal, interest, and any associated costs of the
119.2loan under subdivision 3, or any loan or other financing that refinanced the original loan; or
119.3(2) if the district does not obtain the loan under subdivision 3 prior to May 1, 2017.
119.4(b) Upon expiration of this section, any amount remaining in the account created
119.5under subdivision 2 must be transferred to the general account of the county and used to
119.6reduce any amount to be levied for the district by the county under Minnesota Statutes,
119.7section 103C.331, subdivision 16, for the following year, and any subsequent years, until
119.8the amount remaining is exhausted.
119.9EFFECTIVE DATE.This section is effective the day following compliance by
119.10Carlton County with Minnesota Statutes, section 645.021, subdivisions 2 and 3.

119.11    Sec. 6. ADMINISTRATIVE APPROPRIATIONS.
119.12(a) $700,000 in fiscal year 2014 and $1,800,000 in fiscal year 2015 are appropriated
119.13from the general fund to the commissioner of revenue for administering this act. The
119.14funding base for this appropriation in fiscal year 2016 is $1,180,000 and is available to be
119.15spent until June 30, 2017. The funding base for fiscal year 2017 is $0.
119.16(b) $40,000 in fiscal year 2015 is appropriated from the general fund to the
119.17commissioner of public safety for administration of the volunteer retention stipend aid
119.18pilot program in article 1, section 1. The funding base for this appropriation in fiscal
119.19year 2016 is $18,000 and is available to be spent until June 30, 2018. The funding base
119.20for fiscal year 2017 is $0.
119.21(c) $400,000 in fiscal year 2015 is appropriated from the general fund to the
119.22commissioner of natural resources for the purpose of assisting counties in developing plans
119.23and providing training for watercraft inspectors to facilitate the implementation of article
119.241, section 11. This is a onetime appropriation and does not become part of the base budget.
119.25EFFECTIVE DATE.This section is effective the day following final enactment.

119.26ARTICLE 9
119.27UNSESSION

119.28    Section 1. Minnesota Statutes 2012, section 16D.02, subdivision 3, is amended to read:
119.29    Subd. 3. Debt. "Debt" means an amount owed to the state directly, or through a
119.30state agency, on account of a fee, duty, lease, direct loan, loan insured or guaranteed by
119.31the state, rent, service, sale of real or personal property, overpayment, fine, assessment,
119.32penalty, restitution, damages, interest, tax, bail bond, forfeiture, reimbursement, liability
119.33owed, an assignment to the state including assignments under section 256.741, the Social
120.1Security Act, or other state or federal law, recovery of costs incurred by the state, or any
120.2other source of indebtedness to the state. Debt also includes amounts owed to individuals
120.3as a result of civil, criminal, or administrative action brought by the state or a state agency
120.4pursuant to its statutory authority or for which the state or state agency acts in a fiduciary
120.5capacity in providing collection services in accordance with the regulations adopted under
120.6the Social Security Act at Code of Federal Regulations, title 45, section 302.33. When
120.7the commissioner provides collection services pursuant to a debt qualification plan to a
120.8referring agency, debt also includes an amount owed to the courts, local government
120.9units, Minnesota state colleges and universities governed by the Board of Trustees of the
120.10Minnesota State Colleges and Universities, or University of Minnesota.
120.11EFFECTIVE DATE.This section is effective the day following final enactment.

120.12    Sec. 2. Minnesota Statutes 2012, section 16D.02, subdivision 6, is amended to read:
120.13    Subd. 6. Referring agency. "Referring agency" means a state agency, local
120.14government unit, Minnesota state colleges and universities governed by the Board of
120.15Trustees of the Minnesota State Colleges and Universities, University of Minnesota, or a
120.16court, that has entered into a debt qualification plan an agreement with the commissioner
120.17to refer debts to the commissioner for collection.
120.18EFFECTIVE DATE.This section is effective the day following final enactment.

120.19    Sec. 3. Minnesota Statutes 2012, section 16D.04, subdivision 3, is amended to read:
120.20    Subd. 3. Services. The commissioner shall provide collection services for a state
120.21agency, and may provide for collection services for a court, in accordance with the terms and
120.22conditions of a signed debt qualification plan referring agencies other than state agencies.
120.23EFFECTIVE DATE.This section is effective the day following final enactment.

120.24    Sec. 4. Minnesota Statutes 2012, section 16D.04, subdivision 4, is amended to read:
120.25    Subd. 4. Authority to contract. The commissioners commissioner of revenue and
120.26management and budget may contract with credit bureaus, private collection agencies, and
120.27other entities as necessary for the collection of debts. A private collection agency acting
120.28under a contract with the commissioner of revenue or management and budget is subject
120.29to sections 332.31 to 332.45, except that the private collection agency may indicate that it
120.30is acting under a contract with the state. The commissioner may not delegate the powers
120.31provided under section 16D.08 to any nongovernmental entity.
121.1EFFECTIVE DATE.This section is effective the day following final enactment.

121.2    Sec. 5. Minnesota Statutes 2012, section 16D.07, is amended to read:
121.316D.07 NOTICE TO DEBTOR.
121.4The referring agency shall send notice to the debtor by United States mail or
121.5personal delivery at the debtor's last known address at least 20 days before the debt is
121.6referred to the commissioner. The notice must state the nature and amount of the debt,
121.7identify to whom the debt is owed, and inform the debtor of the remedies available under
121.8this chapter. The referring agency shall advise the debtor of collection costs imposed
121.9under section 16D.11 and of the debtor's right to cancellation of collection costs under
121.10section 16D.11, subdivision 3.
121.11EFFECTIVE DATE.This section is effective the day following final enactment.

121.12    Sec. 6. Minnesota Statutes 2012, section 16D.11, subdivision 1, is amended to read:
121.13    Subdivision 1. Imposition. As determined by the commissioner of management and
121.14budget revenue, collection costs shall be added to the debts referred to the commissioner
121.15or private collection agency for collection. Collection costs are collectible by the
121.16commissioner or private agency from the debtor at the same time and in the same
121.17manner as the referred debt. The referring agency shall advise the debtor of collection
121.18costs under this section and the debtor's right to cancellation of collection costs under
121.19subdivision 3 at the time the agency sends notice to the debtor under section 16D.07.
121.20 If the commissioner or private agency collects an amount less than the total due, the
121.21payment is applied proportionally to collection costs and the underlying debt unless
121.22the commissioner of management and budget has waived this requirement for certain
121.23categories of debt pursuant to the department's internal guidelines. Collection costs
121.24collected by the commissioner under this subdivision or retained under subdivision 6 shall
121.25be deposited in the general fund as nondedicated receipts. Collection costs collected by
121.26private agencies are appropriated to the referring agency to pay the collection fees charged
121.27by the private agency. Collections of collection costs in excess of collection agency fees
121.28must be deposited in the general fund as nondedicated receipts.
121.29EFFECTIVE DATE.This section is effective the day following final enactment.

121.30    Sec. 7. Minnesota Statutes 2012, section 16D.11, subdivision 3, is amended to read:
121.31    Subd. 3. Cancellation. Collection costs imposed under subdivision 1 shall be
121.32canceled and subtracted from the amount due if:
122.1(1) the debtor's household income as defined in section 290A.03, subdivision 5,
122.2excluding the exemption subtractions in subdivision 3, paragraph (3) of that section, for
122.3the 12 months preceding the date of referral is less than twice the annual federal poverty
122.4guideline under United States Code, title 42, section 9902, subsection (2);
122.5(2) within 60 days after the first contact with the debtor by the enterprise
122.6 commissioner or collection agency, the debtor establishes reasonable cause for the failure
122.7to pay the debt prior to referral of the debt to the enterprise commissioner;
122.8(3) a good faith dispute as to the legitimacy or the amount of the debt is made,
122.9and payment is remitted or a payment agreement is entered into within 30 days after
122.10resolution of the dispute;
122.11(4) good faith litigation occurs and the debtor's position is substantially justified, and
122.12if the debtor does not totally prevail, the debt is paid or a payment agreement is entered
122.13into within 30 days after the judgment becomes final and nonappealable; or
122.14(5) collection costs have been added by the referring agency and are included in
122.15the amount of the referred debt.
122.16EFFECTIVE DATE.This section is effective the day following final enactment.

122.17    Sec. 8. Minnesota Statutes 2012, section 16D.11, subdivision 7, is amended to read:
122.18    Subd. 7. Adjustment of rate. By June 1 of each year, the commissioner shall
122.19determine the rate of collection costs for debts referred to the enterprise commissioner
122.20 during the next fiscal year. The rate is a percentage of the debts in an amount that most
122.21nearly equals the costs of the enterprise commissioner necessary to process and collect
122.22referred debts under this chapter. In no event shall the rate of the collection costs exceed
122.2325 percent of the debt. Determination of the rate of collection costs under this section is
122.24not subject to the fee setting requirements of section 16A.1283.
122.25EFFECTIVE DATE.This section is effective the day following final enactment.

122.26    Sec. 9. Minnesota Statutes 2012, section 84A.20, subdivision 2, is amended to read:
122.27    Subd. 2. County proposal to state. Under certain conditions, The board of county
122.28commissioners of any county may by resolution propose to the state that one or more
122.29areas in the county be taken over by the state for afforestation, reforestation, flood control
122.30projects, or other state purposes. The projects are to be managed, controlled, and used for
122.31the purposes in subdivision 1 on lands to be acquired by the state within the projects, as set
122.32forth in sections 84A.20 to 84A.30. The county board may propose this if (1) the county
122.33contains lands suitable for the purposes in subdivision 1, (2) on January 1, 1931, the taxes
123.1on more than 35 percent of the taxable land in the county are delinquent, (3) on January 1,
123.21931, the county's bonded ditch indebtedness, including accrued interest, equals or exceeds
123.3nine percent of the assessed valuation of the county, exclusive of money and credits.
123.4The area taken over must include lands that have been assessed for all or part of
123.5the cost of the establishment and construction of public drainage ditches under state law,
123.6and on which the assessments or installments are delinquent. A certified copy of the
123.7county board's resolution must be filed with the department and considered and acted
123.8upon by the department. If approved by the department, it must then be submitted to,
123.9considered, and acted upon by the executive council. If approved by the Executive
123.10Council, the proposition must be formally accepted by the governor. Acceptance must be
123.11communicated in writing to and filed with the county auditor.
123.12EFFECTIVE DATE.This section is effective the day following final enactment.

123.13    Sec. 10. Minnesota Statutes 2012, section 84A.31, subdivision 2, is amended to read:
123.14    Subd. 2. County proposal to state. Under certain conditions, The board of county
123.15commissioners of any county may by resolution propose that the state take over part of the
123.16tax-delinquent lands in the county. The board may propose this if:
123.17(1) the county contains land suitable for the purposes in subdivision 1;.
123.18(2) on January 1, 1933, the taxes on more than 25 percent of the acreage of the lands
123.19in a town in the county are delinquent, as shown by its tax books;
123.20(3) on January 1, 1933, the taxes or ditch assessments on more than 50 percent of the
123.21acreage of the lands to be taken over are delinquent, as shown by the county's tax books; and
123.22(4) on January 1, 1933, the bonded ditch indebtedness of the county equals or
123.23exceeds 15 percent of the assessed value of the county for 1932 as fixed by the Minnesota
123.24Tax Commission, exclusive of money and credits.
123.25EFFECTIVE DATE.This section is effective the day following final enactment.

123.26    Sec. 11. Minnesota Statutes 2012, section 115B.49, subdivision 4, is amended to read:
123.27    Subd. 4. Registration; fees. (a) The owner or operator of a dry cleaning facility
123.28shall register on or before October 1 of each year with the commissioner of revenue in
123.29a manner prescribed by the commissioner of revenue and pay a registration fee for the
123.30facility. The amount of the fee is:
123.31(1) $500, for facilities with a full-time equivalence of fewer than five;
123.32(2) $1,000, for facilities with a full-time equivalence of five to ten; and
123.33(3) $1,500, for facilities with a full-time equivalence of more than ten.
124.1The registration fee must be paid on or before October 18 or the owner or operator
124.2of a dry cleaning facility may elect to pay the fee in equal installments. Installment
124.3payments must be paid on or before October 18, on or before January 18, on or before
124.4April 18, and on or before June 18. All payments made after October 18 bear interest
124.5at the rate specified in section 270C.40.
124.6(b) A person who sells dry cleaning solvents for use by dry cleaning facilities in
124.7the state shall collect and remit to the commissioner of revenue in a the same manner
124.8prescribed by the commissioner of revenue, on or before the 20th day of the month
124.9following the month in which the sales of dry cleaning solvents are made for the taxes
124.10imposed under chapter 297A, a fee of:
124.11(1) $3.50 for each gallon of perchloroethylene sold for use by dry cleaning facilities
124.12in the state;
124.13(2) 70 cents for each gallon of hydrocarbon-based dry cleaning solvent sold for use
124.14by dry cleaning facilities in the state; and
124.15(3) 35 cents for each gallon of other nonaqueous solvents sold for use by dry
124.16cleaning facilities in the state.
124.17(c) The audit, assessment, appeal, collection, enforcement, and administrative
124.18provisions of chapters 270C and 289A apply to the fee imposed by this subdivision. To
124.19enforce this subdivision, the commissioner of revenue may grant extensions to file returns
124.20and pay fees, impose penalties and interest on the annual registration fee under paragraph
124.21(a) and the monthly fee under paragraph (b), and abate penalties and interest in the manner
124.22provided in chapters 270C and 289A. The penalties and interest imposed on taxes under
124.23chapter 297A apply to the fees imposed under this subdivision. Disclosure of data collected
124.24by the commissioner of revenue under this subdivision is governed by chapter 270B.
124.25EFFECTIVE DATE.This section is effective for fees due after June 30, 2014.

124.26    Sec. 12. Minnesota Statutes 2012, section 163.06, subdivision 1, is amended to read:
124.27    Subdivision 1. Levy. The county board of any county in which there are unorganized
124.28townships may levy a tax for road and bridge purposes upon all the real and personal
124.29property in such unorganized townships, exclusive of money and credits taxed under the
124.30provisions of chapter 285.
124.31EFFECTIVE DATE.This section is effective the day following final enactment.

124.32    Sec. 13. Minnesota Statutes 2012, section 270.11, subdivision 1, is amended to read:
125.1    Subdivision 1. To act as State Board of Equalization. The commissioner of
125.2revenue shall have and exercise all the rights, powers and authority by law vested in the
125.3State Board of Equalization, which board of equalization is hereby continued, with full
125.4power and authority to review, modify, and revise all of the acts and proceedings of the
125.5commissioner in so far as they relate to the equalization and valuation of property assessed
125.6for taxation, as prescribed by section 270.12.
125.7EFFECTIVE DATE.This section is effective the day following final enactment.

125.8    Sec. 14. Minnesota Statutes 2012, section 270.12, subdivision 2, is amended to read:
125.9    Subd. 2. Meeting dates; duties. The board shall meet annually between April 15
125.10and June 30 at the office of the commissioner of revenue and examine and compare the
125.11returns of the assessment of the property in the several counties, and equalize the same so
125.12that all the taxable property in the state shall be assessed at its market value, subject to
125.13the following rules:
125.14(1) The board shall add to or deduct from the aggregate valuation of the real property
125.15of every county, which the board believes to be valued below or above its market value in
125.16money, such percent as will bring the same to its market value in money;
125.17(2) The board shall deduct from the aggregate valuation of the real property of every
125.18county, which the board believes to be valued above its market value in money, such
125.19percent as will reduce the same to its market value in money;
125.20(3) (2) If the board believes the valuation for a part of a class determined by a range
125.21of market value under clause (8) (6) or otherwise, a class, or classes of the real property of
125.22any town or district in any county, or the valuation for a part of a class, a class, or classes
125.23of the real property of any county not in towns or cities, should be raised or reduced,
125.24without raising or reducing the other real property of such county, or without raising or
125.25reducing it in the same ratio, the board may add to, or take from, the valuation of a part of
125.26a class, a class, or classes in any one or more of such towns or cities, or of the property not
125.27in towns or cities, such percent as the board believes will raise or reduce the same to its
125.28market value in money;
125.29(4) (3) The board shall add to or take from the aggregate valuation of any part of a
125.30class, a class, or classes of personal property of any county, town, or city, which the
125.31board believes to be valued below or above the market value thereof, such percent as will
125.32raise the same to its market value in money;
125.33(5) The board shall take from the aggregate valuation of any part of a class, a class,
125.34or classes of personal property in any county, town or city, which the board believes to
126.1be valued above the market value thereof, such percent as will reduce the same to its
126.2market value in money;
126.3(6) (4) The board shall not reduce the aggregate valuation of all the property of the
126.4state, as returned by the several county auditors, more than one percent on the whole
126.5valuation thereof;
126.6(7) (5) When it would be of assistance in equalizing values the board may require any
126.7county auditor to furnish statements showing assessments of real and personal property
126.8of any individuals, firms, or corporations within the county. The board shall consider
126.9and equalize such assessments and may increase the assessment of individuals, firms, or
126.10corporations above the amount returned by the county board of equalization when it shall
126.11appear to be undervalued, first giving notice to such persons of the intention of the board
126.12so to do, which notice shall fix a time and place of hearing. The board shall not decrease
126.13any such assessment below the valuation placed by the county board of equalization;
126.14(8) (6) In equalizing values pursuant to this section, the board shall utilize a 12-month
126.15assessment/sales ratio study conducted by the Department of Revenue containing only
126.16sales that are filed in the county auditor's office under section 272.115, by November 1 of
126.17the previous year and that occurred between October 1 of the year immediately preceding
126.18the previous year and September 30 of the previous year.
126.19The assessment/sales ratio study may separate the values of residential property
126.20into market value categories. The board may adjust the market value categories and the
126.21number of categories as necessary to create an adequate sample size for each market value
126.22category. The board may determine the adequate sample size. To the extent practicable,
126.23the methodology used in preparing the assessment/sales ratio study must be consistent
126.24with the most recent Standard on Assessment Sales Ratio Studies published by the
126.25Assessment Standards Committee of the International Association of Assessing Officers.
126.26The board may determine the geographic area used in preparing the study to accurately
126.27equalize values. A sales ratio study separating residential property into market value
126.28categories may not be used as the basis for a petition under chapter 278.
126.29The sales prices used in the study must be discounted for terms of financing. The
126.30board shall use the median ratio as the statistical measure of the level of assessment for
126.31any particular category of property; and
126.32(9) (7) The board shall receive from each county the estimated market values on the
126.33assessment date falling within the study period for all parcels by magnetic tape or other a
126.34 medium as prescribed by the commissioner of revenue.
126.35EFFECTIVE DATE.This section is effective the day following final enactment.

127.1    Sec. 15. Minnesota Statutes 2012, section 270.12, subdivision 4, is amended to read:
127.2    Subd. 4. Public utility property. For purposes of equalization only, public utility
127.3personal property shall be treated as a separate class of property notwithstanding the fact
127.4that its class rate is the same as commercial-industrial property.
127.5EFFECTIVE DATE.This section is effective the day following final enactment.

127.6    Sec. 16. Minnesota Statutes 2012, section 270A.03, subdivision 2, is amended to read:
127.7    Subd. 2. Claimant agency. "Claimant agency" means any state agency, as defined
127.8by section 14.02, subdivision 2, the regents of the University of Minnesota, any district
127.9court of the state, any county, any statutory or home rule charter city, including a city that
127.10is presenting a claim for a municipal hospital or a public library or a municipal ambulance
127.11service, a hospital district, a private nonprofit hospital that leases its building from the
127.12county or city in which it is located, any ambulance service licensed under chapter 144E,
127.13any public agency responsible for child support enforcement, any public agency responsible
127.14for the collection of court-ordered restitution, and any public agency established by
127.15general or special law that is responsible for the administration of a low-income housing
127.16program, and the Minnesota collection enterprise as defined in section 16D.02, subdivision
127.178
, for the purpose of collecting the costs imposed under section 16D.11.
127.18EFFECTIVE DATE.This section is effective the day following final enactment.

127.19    Sec. 17. Minnesota Statutes 2012, section 270B.14, subdivision 3, is amended to read:
127.20    Subd. 3. Administration of enterprise, and job opportunity, and biotechnology
127.21and health sciences industry zone programs. The commissioner may disclose return
127.22information relating to the taxes imposed by chapters 290 and 297A to the Department of
127.23Employment and Economic Development or a municipality with a border city enterprise
127.24zone as defined under section 469.166, but only as necessary to administer the funding
127.25limitations under section 469.169, or to the Department of Employment and Economic
127.26Development and appropriate officials from the local government units in which a
127.27qualified business is located but only as necessary to enforce the job opportunity building
127.28zone benefits under section 469.315, or biotechnology and health sciences industry zone
127.29benefits under section 469.336.
127.30EFFECTIVE DATE.This section is effective the day following final enactment.

128.1    Sec. 18. Minnesota Statutes 2012, section 270C.085, is amended to read:
128.2270C.085 NOTIFICATION REQUIREMENTS; SALES AND USE TAXES.
128.3The commissioner of revenue shall establish a means of electronically notifying
128.4persons holding a sales tax permit under section 297A.84 of any statutory change in
128.5chapter 297A and any issuance or change in any administrative rule, revenue notice, or
128.6sales tax fact sheet or other written information provided by the department explaining the
128.7interpretation or administration of the tax imposed under that chapter. The notification
128.8must indicate the basic subject of the statute, rule, fact sheet, or other material and provide
128.9an electronic link to the material. Any person holding a sales tax permit that provides
128.10an electronic address to the department must receive these notifications unless they
128.11specifically request electronically, or in writing, to be removed from the notification list.
128.12This requirement does not replace traditional means of notifying the general public or
128.13persons without access to electronic communications of changes in the sales tax law. The
128.14electronic notification must begin no later than December 31, 2009.
128.15EFFECTIVE DATE.This section is effective the day following final enactment.

128.16    Sec. 19. Minnesota Statutes 2012, section 270C.52, subdivision 2, is amended to read:
128.17    Subd. 2. Payment agreements. (a) When any portion of any tax payable to the
128.18commissioner together with interest and penalty thereon, if any, has not been paid, the
128.19commissioner may extend the time for payment for a further period. When the authority
128.20of this section is invoked, the extension shall be evidenced by written agreement signed by
128.21the taxpayer and the commissioner, stating the amount of the tax with penalty and interest,
128.22if any, and providing for the payment of the amount in installments.
128.23(b) The agreement may contain a confession of judgment for the amount and for any
128.24unpaid portion thereof. If the agreement contains a confession of judgment, the confession
128.25of judgment must provide that the commissioner may enter judgment against the taxpayer
128.26in the district court of the county of residence as shown upon the taxpayer's tax return for
128.27the unpaid portion of the amount specified in the extension agreement.
128.28(c) The agreement shall provide that it can be terminated, after notice by the
128.29commissioner, if information provided by the taxpayer prior to the agreement was
128.30inaccurate or incomplete, collection of the tax covered by the agreement is in jeopardy,
128.31there is a subsequent change in the taxpayer's financial condition, the taxpayer has failed
128.32to make a payment due under the agreement, or the taxpayer has failed to pay any other
128.33tax or file a tax return coming due after the agreement.
129.1(d) The notice must be given at least 14 calendar days prior to termination, and shall
129.2advise the taxpayer of the right to request a reconsideration from the commissioner of
129.3whether termination is reasonable and appropriate under the circumstances. A request for
129.4reconsideration does not stay collection action beyond the 14-day notice period. If the
129.5commissioner has reason to believe that collection of the tax covered by the agreement
129.6is in jeopardy, the commissioner may proceed under section 270C.36 and terminate the
129.7agreement without regard to the 14-day period.
129.8(e) The commissioner may accept other collateral the commissioner considers
129.9appropriate to secure satisfaction of the tax liability. The principal sum specified in the
129.10agreement shall bear interest at the rate specified in section 270C.40 on all unpaid portions
129.11thereof until the same has been fully paid or the unpaid portion thereof has been entered as
129.12a judgment. The judgment shall bear interest at the rate specified in section 270C.40.
129.13(f) If it appears to the commissioner that the tax reported by the taxpayer is in excess
129.14of the amount actually owing by the taxpayer, the extension agreement or the judgment
129.15entered pursuant thereto shall be corrected. If after making the extension agreement
129.16or entering judgment with respect thereto, the commissioner determines that the tax as
129.17reported by the taxpayer is less than the amount actually due, the commissioner shall
129.18assess a further tax in accordance with the provisions of law applicable to the tax.
129.19(g) The authority granted to the commissioner by this section is in addition to any
129.20other authority granted to the commissioner by law to extend the time of payment or the
129.21time for filing a return and shall not be construed in limitation thereof.
129.22(h) The commissioner shall charge a fee for entering into payment agreements that
129.23reflects the commissioner's costs for entering into payment agreements. The fee is set at
129.24$50 and is charged for entering into a payment agreement, for entering into a new payment
129.25agreement after the taxpayer has defaulted on a prior agreement, and for entering into a
129.26new payment agreement as a result of renegotiation of the terms of an existing agreement.
129.27The fee is paid to the commissioner before the payment agreement becomes effective and
129.28does not reduce the amount of the liability.
129.29EFFECTIVE DATE.This section is effective the day following final enactment.

129.30    Sec. 20. Minnesota Statutes 2012, section 272.01, subdivision 1, is amended to read:
129.31    Subdivision 1. Generally taxable. All real and personal property in this state, and
129.32all personal property of persons residing therein, including the property of corporations,
129.33banks, banking companies, and bankers, is taxable, except Indian lands and such other
129.34property as is by law exempt from taxation.
130.1EFFECTIVE DATE.This section is effective the day following final enactment.

130.2    Sec. 21. Minnesota Statutes 2012, section 272.01, subdivision 3, is amended to read:
130.3    Subd. 3. Exceptions. The provisions of subdivision 2 shall not apply to:
130.4(a) Federal property for which payments are made in lieu of taxes in amounts
130.5equivalent to taxes which might otherwise be lawfully assessed;
130.6(b) Real estate exempt from ad valorem taxes and taxes in lieu thereof which is
130.7leased, loaned, or otherwise made available to telephone companies or electric, light
130.8and power companies upon which personal property consisting of transmission and
130.9distribution lines is situated and assessed pursuant to sections 273.37, 273.38, 273.40
130.10and 273.41, or upon which are situated the communication lines of express, railway, or
130.11telephone or telegraph companies, or pipelines used for the transmission and distribution
130.12of petroleum products, or the equipment items of a cable communications company
130.13subject to sections 238.35 to 238.42;
130.14(c) Property presently owned by any educational institution chartered by the
130.15territorial legislature;
130.16(d) Indian lands;
130.17(e) Property of any corporation organized as a tribal corporation under the Indian
130.18Reorganization Act of June 18, 1934, (Statutes at Large, volume 48, page 984);
130.19(f) Real property owned by the state and leased pursuant to section 161.23 or
130.20161.431 , and acts amendatory thereto;
130.21(g) Real property owned by a seaway port authority on June 1, 1967, upon which
130.22there has been constructed docks, warehouses, tank farms, administrative and maintenance
130.23buildings, railroad and ship terminal facilities and other maritime and transportation
130.24facilities or those directly related thereto, together with facilities for the handling of
130.25passengers and baggage and for the handling of freight and bulk liquids, and personal
130.26property owned by a seaway port authority used or usable in connection therewith, when
130.27said property is leased to a private individual, association or corporation, but only when
130.28such lease provides that the said facilities are available to the public for the loading and
130.29unloading of passengers and their baggage and the handling, storage, care, shipment,
130.30and delivery of merchandise, freight and baggage and other maritime and transportation
130.31activities and functions directly related thereto, but not including property used for grain
130.32elevator facilities; it being the declared policy of this state that such property when
130.33so leased is public property used exclusively for a public purpose, notwithstanding the
130.34one-year limitation in the provisions of section 273.19;
131.1(h) Notwithstanding the provisions of clause (g), when the annual rental received by
131.2a seaway port authority in any calendar year for such leased property exceeds an amount
131.3reasonably required for administrative expense of the authority per year, plus promotional
131.4expense for the authority not to exceed the sum of $100,000 per year, to be expended
131.5when and in the manner decided upon by the commissioners, plus an amount sufficient to
131.6pay all installments of principal and interest due, or to become due, during such calendar
131.7year and the next succeeding year on any revenue bonds issued by the authority, plus
131.825 percent of the gross annual rental to be retained by the authority for improvement,
131.9development, or other contingencies, the authority shall make a payment in lieu of real
131.10and personal property taxes of a reasonable portion of the remaining annual rental to the
131.11county treasurer of the county in which such seaway port authority is principally located.
131.12Any such payments to the county treasurer shall be disbursed by the treasurer on the same
131.13basis as real estate taxes are divided among the various governmental units, but if such
131.14port authority shall have received funds from the state of Minnesota and funds from any
131.15city and county pursuant to Laws 1957, chapters 648, 831, and 849 and acts amendatory
131.16thereof, then such disbursement by the county treasurer shall be on the same basis as real
131.17estate taxes are divided among the various governmental units, except that the portion of
131.18such payments which would otherwise go to other taxing units shall be divided equally
131.19among the state of Minnesota and said county and city.
131.20EFFECTIVE DATE.This section is effective the day following final enactment.

131.21    Sec. 22. Minnesota Statutes 2012, section 272.025, subdivision 1, is amended to read:
131.22    Subdivision 1. Statement of exemption. (a) Except in the case of property owned
131.23by the state of Minnesota or any political subdivision thereof, and property exempt from
131.24taxation under section 272.02, subdivisions 9, 10, 13, 15, 18, 20, and 22 to 25, and at the
131.25times provided in subdivision 3, a taxpayer claiming an exemption from taxation on
131.26property described in section 272.02, subdivisions 1 2 to 33, must file a statement of
131.27exemption with the assessor of the assessment district in which the property is located.
131.28(b) A taxpayer claiming an exemption from taxation on property described in section
131.29272.02, subdivision 10 , must file a statement of exemption with the commissioner of
131.30revenue, on or before February 15 of each year for which the taxpayer claims an exemption.
131.31(c) In case of sickness, absence or other disability or for good cause, the assessor
131.32or the commissioner may extend the time for filing the statement of exemption for a
131.33period not to exceed 60 days.
131.34(d) The commissioner of revenue shall prescribe the form and contents of the
131.35statement of exemption.
132.1EFFECTIVE DATE.This section is effective the day following final enactment.

132.2    Sec. 23. Minnesota Statutes 2012, section 272.027, subdivision 1, is amended to read:
132.3    Subdivision 1. Electricity generated to produce goods and services. Personal
132.4property used to generate electric power is exempt from property taxation if the electric
132.5power is used to manufacture or produce goods, products, or services, other than electric
132.6power, by the owner of the electric generation plant. Except as provided in subdivisions 2
132.7and 3, The exemption does not apply to property used to produce electric power for sale
132.8to others and does not apply to real property. In determining the value subject to tax,
132.9a proportionate share of the value of the generating facilities, equal to the proportion
132.10that the power sold to others bears to the total generation of the plant, is subject to the
132.11general property tax in the same manner as other property. Power generated in such a
132.12plant and exchanged for an equivalent amount of power that is used for the manufacture or
132.13production of goods, products, or services other than electric power by the owner of the
132.14generating plant is considered to be used by the owner of the plant.
132.15EFFECTIVE DATE.This section is effective the day following final enactment.

132.16    Sec. 24. Minnesota Statutes 2012, section 272.029, subdivision 6, is amended to read:
132.17    Subd. 6. Distribution of revenues. Revenues from the taxes imposed under
132.18subdivision 5 must be part of the settlement between the county treasurer and the county
132.19auditor under section 276.09. The revenue must be distributed by the county auditor or the
132.20county treasurer to local taxing jurisdictions in which the wind energy conversion system
132.21is located as follows: beginning with distributions in 2010, 80 percent to counties; and 20
132.22percent to cities and townships; and for distributions occurring in 2006 to 2009, 80 percent
132.23to counties; 14 percent to cities and townships; and six percent to school districts.
132.24EFFECTIVE DATE.This section is effective the day following final enactment.

132.25    Sec. 25. Minnesota Statutes 2012, section 273.061, subdivision 6, is amended to read:
132.26    Subd. 6. Salaries; expenses. The salaries of the county assessor and assistants and
132.27clerical help, shall be fixed by the board of county commissioners and shall be payable in
132.28monthly installments out of the general revenue fund of the county. In counties with a
132.29population of less than 50,000 inhabitants, according to the then last preceding federal
132.30census, the board of county commissioners shall not fix the salary of the county assessor at
132.31an amount below the following schedule:
132.32In counties with a population of less than 6,500, $5,900;
133.1In counties with a population of 6,500 but less than 12,000, $6,200;
133.2In counties with a population of 12,000 but less than 16,000, $6,500;
133.3In counties with a population of 16,000 but less than 21,000, $6,700;
133.4In counties with a population of 21,000 but less than 30,000, $6,900;
133.5In counties with a population of 30,000 but less than 39,500, $7,100;
133.6In counties with a population of 39,500 but less than 50,000, $7,300;
133.7In counties with a population of 50,000 or more, $8,300.
133.8In addition to their salaries, the county assessor and assistants shall be allowed their
133.9expenses for reasonable and necessary travel in the performance of their duties, including
133.10necessary travel, lodging and meal expense incurred by them while attending meetings of
133.11instructions or official hearings called by the commissioner of revenue. These expenses
133.12shall be payable out of the general revenue fund of the county, and shall be allowed on the
133.13same basis as such expenses are allowed to other county officers.
133.14EFFECTIVE DATE.This section is effective the day following final enactment.

133.15    Sec. 26. Minnesota Statutes 2012, section 273.10, is amended to read:
133.16273.10 SCHOOL DISTRICTS.
133.17When assessing personal property the county assessor shall designate the number of
133.18the school district in which each person assessed is liable for tax, by writing the number
133.19of the district opposite each assessment in a column provided for that purpose in the
133.20assessment book. When the personal property of any person is assessable in several
133.21school districts, the amount in each shall be assessed separately, and the name of the
133.22owner placed opposite each amount.
133.23EFFECTIVE DATE.This section is effective the day following final enactment.

133.24    Sec. 27. Minnesota Statutes 2012, section 273.11, subdivision 13, is amended to read:
133.25    Subd. 13. Valuation of income-producing property. Beginning with the 1995
133.26assessment, Only accredited assessors or senior accredited assessors or other licensed
133.27assessors who have successfully completed at least two income-producing property
133.28appraisal courses may value income-producing property for ad valorem tax purposes.
133.29"Income-producing property" as used in this subdivision means the taxable property in
133.30class 3a and 3b in section 273.13, subdivision 24; class 4a and 4c, except for seasonal
133.31recreational property not used for commercial purposes; and class 5 in section 273.13,
133.32subdivision 31
. "Income-producing property" includes any property in class 4e in section
133.33273.13, subdivision 25 , that would be income-producing property under the definition in
134.1this subdivision if it were not substandard. "Income-producing property appraisal course"
134.2as used in this subdivision means a course of study of approximately 30 instructional
134.3hours, with a final comprehensive test. An assessor must successfully complete the final
134.4examination for each of the two required courses. The course must be approved by the
134.5board of assessors.
134.6EFFECTIVE DATE.This section is effective the day following final enactment.

134.7    Sec. 28. Minnesota Statutes 2012, section 273.112, subdivision 6a, is amended to read:
134.8    Subd. 6a. Guidelines issued by commissioner. The commissioner of revenue shall
134.9develop and issue guidelines for qualification by private golf clubs under this section
134.10covering the access to and use of the golf course by members and other adults so as to be
134.11consistent with the purposes and terms of this section. The guidelines shall be mailed to
134.12the county attorney and assessor of each county not later than 60 days following May 26,
134.131989. Within 15 days of receipt of the guidelines from the commissioner, the assessor
134.14shall mail a copy of the guidelines to each golf club in the county.
134.15EFFECTIVE DATE.This section is effective the day following final enactment.

134.16    Sec. 29. Minnesota Statutes 2013 Supplement, section 273.1325, subdivision 2,
134.17is amended to read:
134.18    Subd. 2. Methodology. In making its annual assessment/sales ratio studies, the
134.19Department of Revenue must use a methodology consistent with the most recent Standard
134.20on Assessment Ratio Studies published by the assessment standards committee of the
134.21International Association of Assessing Officers. The commissioner of revenue shall
134.22supplement this general methodology with specific procedures necessary for execution of
134.23the study in accordance with other Minnesota laws impacting the assessment/sales ratio
134.24study. The commissioner shall document these specific procedures in writing and shall
134.25publish the procedures in the State Register, but these procedures will not be considered
134.26"rules" pursuant to the Minnesota Administrative Procedure Act. When property is sold and
134.27the purchaser changes its use in a manner that would result in a change of classification of
134.28the property, the assessment sales ratio study under this subdivision must take into account
134.29that changed classification as soon as practicable. A change in status from homestead to
134.30nonhomestead or from nonhomestead to homestead is not a change under this subdivision.
134.31For purposes of this section, sections 270.12, subdivision 2, clause (8) (6), and 278.05,
134.32subdivision 4
, the commissioner of revenue shall exclude from the assessment/sales ratio
134.33study the sale of any nonagricultural property which does not contain an improvement,
135.1if (1) the statutory basis on which the property's taxable value as most recently assessed
135.2is less than market value as defined in section 273.11, or (2) the property has undergone
135.3significant physical change or a change of use since the most recent assessment.
135.4EFFECTIVE DATE.This section is effective the day following final enactment.

135.5    Sec. 30. Minnesota Statutes 2013 Supplement, section 273.1398, subdivision 3,
135.6is amended to read:
135.7    Subd. 3. Disparity reduction aid. The amount of disparity aid certified for each
135.8taxing district within each unique taxing jurisdiction is the amount certified for taxes
135.9payable in the prior year shall be multiplied by the ratio of (1) the jurisdiction's tax
135.10capacity using the class rates for taxes payable in the year for which aid is being computed,
135.11to (2) its tax capacity using the class rates for taxes payable in the year prior to that for
135.12which aid is being computed, both based upon taxable market values for taxes payable in
135.13the year prior to that for which aid is being computed. If the commissioner determines
135.14that insufficient information is available to reasonably and timely calculate the numerator
135.15in this ratio for the first taxes payable year that a class rate change or new class rate is
135.16effective, the commissioner shall omit the effects of that class rate change or new class
135.17rate when calculating this ratio for aid payable in that taxes payable year. For aid payable
135.18in the year following a year for which such omission was made, the commissioner shall
135.19use in the denominator for the class that was changed or created, the tax capacity for taxes
135.20payable two years prior to that in which the aid is payable, based on taxable market values
135.21for taxes payable in the year prior to that for which aid is being computed.
135.22EFFECTIVE DATE.This section is effective beginning for taxes payable in 2015.

135.23    Sec. 31. Minnesota Statutes 2012, section 273.18, is amended to read:
135.24273.18 LISTING, VALUATION, AND ASSESSMENT OF EXEMPT
135.25PROPERTY BY COUNTY AUDITORS.
135.26(a) In every sixth year after the year 1926 2010, the county auditor shall enter, in
135.27a separate place in the real estate assessment books, the description of each tract of real
135.28property exempt by law from taxation, with the name of the owner, if known, and the
135.29assessor shall value and assess the same in the same manner that other real property is
135.30valued and assessed, and shall designate in each case the purpose for which the property is
135.31used.
135.32(b) For purposes of the apportionment of fire state aid under section 69.021,
135.33subdivision 7
, the county auditor shall include on the abstract of assessment of exempt real
136.1property filed under this section, the total number of acres of all natural resources lands for
136.2which in lieu payments are made under sections 477A.11 to 477A.14. The assessor shall
136.3estimate its market value, provided that if the assessor is not able to estimate the market
136.4value of the land on a per parcel basis, the assessor shall furnish the commissioner of
136.5revenue with an estimate of the average value per acre of this land within the county.
136.6EFFECTIVE DATE.This section is effective the day following final enactment.

136.7    Sec. 32. Minnesota Statutes 2012, section 274.01, subdivision 1, is amended to read:
136.8    Subdivision 1. Ordinary board; meetings, deadlines, grievances. (a) The town
136.9board of a town, or the council or other governing body of a city, is the board of appeal
136.10and equalization except (1) in cities whose charters provide for a board of equalization or
136.11(2) in any city or town that has transferred its local board of review power and duties to
136.12the county board as provided in subdivision 3. The county assessor shall fix a day and
136.13time when the board or the board of equalization shall meet in the assessment districts
136.14of the county. Notwithstanding any law or city charter to the contrary, a city board of
136.15equalization shall be referred to as a board of appeal and equalization. On or before
136.16February 15 of each year the assessor shall give written notice of the time to the city or
136.17town clerk. Notwithstanding the provisions of any charter to the contrary, the meetings
136.18must be held between April 1 and May 31 each year. The clerk shall give published and
136.19posted notice of the meeting at least ten days before the date of the meeting.
136.20    The board shall meet at the office of the clerk to review the assessment and
136.21classification of property in the town or city. No changes in valuation or classification
136.22which are intended to correct errors in judgment by the county assessor may be made by
136.23the county assessor after the board has adjourned in those cities or towns that hold a
136.24local board of review; however, corrections of errors that are merely clerical in nature or
136.25changes that extend homestead treatment to property are permitted after adjournment until
136.26the tax extension date for that assessment year. The changes must be fully documented and
136.27maintained in the assessor's office and must be available for review by any person. A copy
136.28of the changes made during this period in those cities or towns that hold a local board of
136.29review must be sent to the county board no later than December 31 of the assessment year.
136.30    (b) The board shall determine whether the taxable property in the town or city has
136.31been properly placed on the list and properly valued by the assessor. If real or personal
136.32property has been omitted, the board shall place it on the list with its market value, and
136.33correct the assessment so that each tract or lot of real property, and each article, parcel,
136.34or class of personal property, is entered on the assessment list at its market value. No
136.35assessment of the property of any person may be raised unless the person has been
137.1duly notified of the intent of the board to do so. On application of any person feeling
137.2aggrieved, the board shall review the assessment or classification, or both, and correct
137.3it as appears just. The board may not make an individual market value adjustment or
137.4classification change that would benefit the property if the owner or other person having
137.5control over the property has refused the assessor access to inspect the property and the
137.6interior of any buildings or structures as provided in section 273.20. A board member
137.7shall not participate in any actions of the board which result in market value adjustments
137.8or classification changes to property owned by the board member, the spouse, parent,
137.9stepparent, child, stepchild, grandparent, grandchild, brother, sister, uncle, aunt, nephew,
137.10or niece of a board member, or property in which a board member has a financial interest.
137.11The relationship may be by blood or marriage.
137.12    (c) A local board may reduce assessments upon petition of the taxpayer but the total
137.13reductions must not reduce the aggregate assessment made by the county assessor by more
137.14than one percent. If the total reductions would lower the aggregate assessments made by
137.15the county assessor by more than one percent, none of the adjustments may be made. The
137.16assessor shall correct any clerical errors or double assessments discovered by the board
137.17without regard to the one percent limitation.
137.18    (d) A local board does not have authority to grant an exemption or to order property
137.19removed from the tax rolls.
137.20    (e) A majority of the members may act at the meeting, and adjourn from day to day
137.21until they finish hearing the cases presented. The assessor shall attend, with the assessment
137.22books and papers, and take part in the proceedings, but must not vote. The county assessor,
137.23or an assistant delegated by the county assessor shall attend the meetings. The board shall
137.24list separately, on a form appended to the assessment book, all omitted property added
137.25to the list by the board and all items of property increased or decreased, with the market
137.26value of each item of property, added or changed by the board, placed opposite the item.
137.27The county assessor shall enter all changes made by the board in the assessment book.
137.28    (f) Except as provided in subdivision 3, if a person fails to appear in person, by
137.29counsel, or by written communication before the board after being duly notified of the
137.30board's intent to raise the assessment of the property, or if a person feeling aggrieved by an
137.31assessment or classification fails to apply for a review of the assessment or classification,
137.32the person may not appear before the county board of appeal and equalization for a review
137.33of the assessment or classification. This paragraph does not apply if an assessment was
137.34made after the local board meeting, as provided in section 273.01, or if the person can
137.35establish not having received notice of market value at least five days before the local
137.36board meeting.
138.1    (g) The local board must complete its work and adjourn within 20 days from the
138.2time of convening stated in the notice of the clerk, unless a longer period is approved by
138.3the commissioner of revenue. No action taken after that date is valid. All complaints
138.4about an assessment or classification made after the meeting of the board must be heard
138.5and determined by the county board of equalization. A nonresident may, at any time,
138.6before the meeting of the board file written objections to an assessment or classification
138.7with the county assessor. The objections must be presented to the board at its meeting by
138.8the county assessor for its consideration.
138.9EFFECTIVE DATE.This section is effective the day following final enactment.

138.10    Sec. 33. Minnesota Statutes 2012, section 274.01, subdivision 2, is amended to read:
138.11    Subd. 2. Special board; duties delegated. The governing body of a city, including
138.12a city whose charter provides for a board of equalization, may appoint a special board of
138.13review. The city may delegate to the special board of review all of the powers and duties
138.14in subdivision 1. The special board of review shall serve at the direction and discretion
138.15of the appointing body, subject to the restrictions imposed by law. The appointing body
138.16shall determine the number of members of the board, the compensation and expenses to be
138.17paid, and the term of office of each member. At least one member of the special board
138.18of review must be an appraiser, realtor, or other person familiar with property valuations
138.19in the assessment district.
138.20EFFECTIVE DATE.This section is effective the day following final enactment.

138.21    Sec. 34. Minnesota Statutes 2012, section 275.08, subdivision 1a, is amended to read:
138.22    Subd. 1a. Computation of tax capacity. For taxes payable in 1989, the county
138.23auditor shall compute the gross tax capacity for each parcel according to the class rates
138.24specified in section 273.13. The gross tax capacity will be the appropriate class rate
138.25multiplied by the parcel's market value. For taxes payable in 1990 and subsequent years,
138.26 The county auditor shall compute the net tax capacity for each parcel according to the
138.27class rates specified in section 273.13. The net tax capacity will be the appropriate class
138.28rate multiplied by the parcel's market value.
138.29EFFECTIVE DATE.This section is effective the day following final enactment.

138.30    Sec. 35. Minnesota Statutes 2012, section 275.08, subdivision 1d, is amended to read:
138.31    Subd. 1d. Additional adjustment. If, after computing each local government's
138.32adjusted local tax rate within a unique taxing jurisdiction pursuant to subdivision 1c, the
139.1auditor finds that the total adjusted local tax rate of all local governments combined is
139.2less than 90 percent of gross tax capacity for taxes payable in 1989 and 90 percent of net
139.3tax capacity for taxes payable in 1990 and thereafter, the auditor shall increase each local
139.4government's adjusted local tax rate proportionately so the total adjusted local tax rate of
139.5all local governments combined equals 90 percent. The total amount of the increase in
139.6tax resulting from the increased local tax rates must not exceed the amount of disparity
139.7aid allocated to the unique taxing district under section 273.1398. The auditor shall
139.8certify to the Department of Revenue the difference between the disparity aid originally
139.9allocated under section 273.1398, subdivision 3, and the amount necessary to reduce
139.10the total adjusted local tax rate of all local governments combined to 90 percent. Each
139.11local government's disparity reduction aid payment under section 273.1398, subdivision
139.126
, must be reduced accordingly.
139.13EFFECTIVE DATE.This section is effective the day following final enactment.

139.14    Sec. 36. Minnesota Statutes 2013 Supplement, section 275.70, subdivision 5, is
139.15amended to read:
139.16    Subd. 5. Special levies. "Special levies" means those portions of ad valorem taxes
139.17levied by a local governmental unit for the following purposes or in the following manner:
139.18    (1) to pay the costs of the principal and interest on bonded indebtedness or to
139.19reimburse for the amount of liquor store revenues used to pay the principal and interest
139.20due on municipal liquor store bonds in the year preceding the year for which the levy
139.21limit is calculated;
139.22    (2) to pay the costs of principal and interest on certificates of indebtedness issued for
139.23any corporate purpose except for the following:
139.24    (i) tax anticipation or aid anticipation certificates of indebtedness;
139.25    (ii) certificates of indebtedness issued under sections 298.28 and 298.282;
139.26    (iii) certificates of indebtedness used to fund current expenses or to pay the costs of
139.27extraordinary expenditures that result from a public emergency; or
139.28    (iv) certificates of indebtedness used to fund an insufficiency in tax receipts or an
139.29insufficiency in other revenue sources, provided that nothing in this subdivision limits the
139.30special levy authorized under section 475.755;
139.31    (3) to provide for the bonded indebtedness portion of payments made to another
139.32political subdivision of the state of Minnesota;
139.33    (4) to fund payments made to the Minnesota State Armory Building Commission
139.34under section 193.145, subdivision 2, to retire the principal and interest on armory
139.35construction bonds;
140.1    (5) property taxes approved by voters which are levied against the referendum
140.2market value as provided under section 275.61;
140.3    (6) to fund matching requirements needed to qualify for federal or state grants or
140.4programs to the extent that either (i) the matching requirement exceeds the matching
140.5requirement in calendar year 2001, or (ii) it is a new matching requirement that did not
140.6exist prior to 2002;
140.7    (7) to pay the expenses reasonably and necessarily incurred in preparing for or
140.8repairing the effects of natural disaster including the occurrence or threat of widespread
140.9or severe damage, injury, or loss of life or property resulting from natural causes, in
140.10accordance with standards formulated by the Emergency Services Division of the state
140.11Department of Public Safety, as allowed by the commissioner of revenue under section
140.12275.74, subdivision 2 ;
140.13    (8) pay amounts required to correct an error in the levy certified to the county
140.14auditor by a city or county in a levy year, but only to the extent that when added to the
140.15preceding year's levy it is not in excess of an applicable statutory, special law or charter
140.16limitation, or the limitation imposed on the governmental subdivision by sections 275.70
140.17to 275.74 in the preceding levy year;
140.18    (9) to pay an abatement under section 469.1815;
140.19    (10) to pay any costs attributable to increases in the employer contribution rates under
140.20chapter 353, or locally administered pension plans, that are effective after June 30, 2001;
140.21    (11) to pay the operating or maintenance costs of a county jail as authorized in section
140.22641.01 or 641.262, or of a correctional facility as defined in section 241.021, subdivision 1,
140.23paragraph (f), to the extent that the county can demonstrate to the commissioner of revenue
140.24that the amount has been included in the county budget as a direct result of a rule, minimum
140.25requirement, minimum standard, or directive of the Department of Corrections, or to pay
140.26the operating or maintenance costs of a regional jail as authorized in section 641.262. For
140.27purposes of this clause, a district court order is not a rule, minimum requirement, minimum
140.28standard, or directive of the Department of Corrections. If the county utilizes this special
140.29levy, except to pay operating or maintenance costs of a new regional jail facility under
140.30sections 641.262 to 641.264 which will not replace an existing jail facility, any amount
140.31levied by the county in the previous levy year for the purposes specified under this clause
140.32and included in the county's previous year's levy limitation computed under section
140.33275.71 , shall be deducted from the levy limit base under section 275.71, subdivision 2,
140.34when determining the county's current year levy limitation. The county shall provide the
140.35necessary information to the commissioner of revenue for making this determination;
141.1    (12) to pay for operation of a lake improvement district, as authorized under section
141.2103B.555 . If the county utilizes this special levy, any amount levied by the county in the
141.3previous levy year for the purposes specified under this clause and included in the county's
141.4previous year's levy limitation computed under section 275.71 shall be deducted from
141.5the levy limit base under section 275.71, subdivision 2, when determining the county's
141.6current year levy limitation. The county shall provide the necessary information to the
141.7commissioner of revenue for making this determination;
141.8    (13) to repay a state or federal loan used to fund the direct or indirect required
141.9spending by the local government due to a state or federal transportation project or other
141.10state or federal capital project. This authority may only be used if the project is not a
141.11local government initiative;
141.12    (14) to pay for court administration costs as required under section 273.1398,
141.13subdivision 4b
, less the (i) county's share of transferred fines and fees collected by the
141.14district courts in the county for calendar year 2001 and (ii) the aid amount certified to be
141.15paid to the county in 2004 under section 273.1398, subdivision 4c; however, for taxes
141.16levied to pay for these costs in the year in which the court financing is transferred to the
141.17state, the amount under this clause is limited to the amount of aid the county is certified to
141.18receive under section 273.1398, subdivision 4a;
141.19    (15) (14) to fund a firefighters relief association as required under Laws 2013,
141.20chapter 111, article 5, sections 31 to 42, to the extent that the required amount exceeds the
141.21amount levied for this purpose in 2001;
141.22    (16) (15) for purposes of a storm sewer improvement district under section 444.20;
141.23    (17) (16) to pay for the maintenance and support of a city or county society for
141.24the prevention of cruelty to animals under section 343.11, but not to exceed in any year
141.25$4,800 or the sum of $1 per capita based on the county's or city's population as of the most
141.26recent federal census, whichever is greater. If the city or county uses this special levy, any
141.27amount levied by the city or county in the previous levy year for the purposes specified
141.28in this clause and included in the city's or county's previous year's levy limit computed
141.29under section 275.71, must be deducted from the levy limit base under section 275.71,
141.30subdivision 2
, in determining the city's or county's current year levy limit;
141.31    (18) (17) for counties, to pay for the increase in their share of health and human
141.32service costs caused by reductions in federal health and human services grants effective
141.33after September 30, 2007;
141.34    (19) (18) for a city, for the costs reasonably and necessarily incurred for securing,
141.35maintaining, or demolishing foreclosed or abandoned residential properties, as allowed by
141.36the commissioner of revenue under section 275.74, subdivision 2. A city must have either
142.1(i) a foreclosure rate of at least 1.4 percent in 2007, or (ii) a foreclosure rate in 2007 in
142.2the city or in a zip code area of the city that is at least 50 percent higher than the average
142.3foreclosure rate in the metropolitan area, as defined in section 473.121, subdivision 2,
142.4to use this special levy. For purposes of this paragraph, "foreclosure rate" means the
142.5number of foreclosures, as indicated by sheriff sales records, divided by the number of
142.6households in the city in 2007;
142.7    (20) for a city, for the unreimbursed costs of redeployed traffic-control agents and
142.8lost traffic citation revenue due to the collapse of the Interstate 35W bridge, as certified
142.9to the Federal Highway Administration;
142.10    (21) (19) to pay costs attributable to wages and benefits for sheriff, police, and fire
142.11personnel. If a local governmental unit did not use this special levy in the previous year its
142.12levy limit base under section 275.71 shall be reduced by the amount equal to the amount it
142.13levied for the purposes specified in this clause in the previous year;
142.14    (22) (20) an amount equal to any reductions in the certified aids or credit
142.15reimbursements payable under sections 477A.011 to 477A.014, and section 273.1384,
142.16due to unallotment under section 16A.152 or reductions under another provision of law.
142.17The amount of the levy allowed under this clause for each year is limited to the amount
142.18unallotted or reduced from the aids and credit reimbursements certified for payment in the
142.19year following the calendar year in which the tax levy is certified unless the unallotment
142.20or reduction amount is not known by September 1 of the levy certification year, and
142.21the local government has not adjusted its levy under section 275.065, subdivision 6, or
142.22275.07, subdivision 6 , in which case that unallotment or reduction amount may be levied
142.23in the following year;
142.24(23) (21) to pay for the difference between one-half of the costs of confining sex
142.25offenders undergoing the civil commitment process and any state payments for this
142.26purpose pursuant to section 253D.12;
142.27(24) (22) for a county to pay the costs of the first year of maintaining and operating
142.28a new facility or new expansion, either of which contains courts, corrections, dispatch,
142.29criminal investigation labs, or other public safety facilities and for which all or a portion
142.30of the funding for the site acquisition, building design, site preparation, construction, and
142.31related equipment was issued or authorized prior to the imposition of levy limits in 2008.
142.32The levy limit base shall then be increased by an amount equal to the new facility's first
142.33full year's operating costs as described in this clause; and
142.34(25) (23) for the estimated amount of reduction to market value credit reimbursements
142.35under section 273.1384 for credits payable in the year in which the levy is payable.
142.36EFFECTIVE DATE.This section is effective the day following final enactment.

143.1    Sec. 37. Minnesota Statutes 2012, section 275.74, subdivision 2, is amended to read:
143.2    Subd. 2. Authorization for special levies. (a) A local governmental unit may
143.3request authorization to levy for unreimbursed costs for natural disasters under section
143.4275.70, subdivision 5 , clause (7). The local governmental unit shall submit a request to
143.5levy under section 275.70, subdivision 5, clause (7), to the commissioner of revenue by
143.6September 30 of the levy year and the request must include information documenting the
143.7estimated unreimbursed costs. The commissioner of revenue may grant levy authority,
143.8up to the amount requested based on the documentation submitted. All decisions of the
143.9commissioner are final.
143.10    (b) A city may request authorization to levy for reasonable and necessary costs for
143.11securing, maintaining, or demolishing foreclosed or abandoned residential properties under
143.12section 275.70, subdivision 5, clause (19) (18). The local governmental unit shall submit a
143.13request to levy under section 275.70, subdivision 5, clause (19) (18), to the commissioner
143.14of revenue by September 30 of the levy year and the request must include information
143.15documenting the estimated costs. For taxes payable in 2009, the amount may include
143.16unanticipated costs incurred above the amount budgeted for these purposes in 2008. Costs
143.17of securing foreclosed or abandoned residential properties include payment for police and
143.18fire department services. The commissioner of revenue may grant levy authority, up to the
143.19lesser of (1) the amount requested based on the documentation submitted, or (2) $3,000
143.20multiplied by the number of foreclosed residential properties, as defined by sheriff sales
143.21records, in calendar year 2007. All decisions of the commissioner are final.
143.22EFFECTIVE DATE.This section is effective the day following final enactment.

143.23    Sec. 38. Minnesota Statutes 2012, section 275.75, is amended to read:
143.24275.75 CHARTER EXEMPTION FOR AID LOSS.
143.25Notwithstanding any other provision of a municipal charter that limits ad valorem
143.26taxes to a lesser amount, or that would require voter approval for any increase, the
143.27governing body of a municipality may by resolution increase its levy in any year by an
143.28amount equal to its special levies under section 275.70, subdivision 5, clauses (22) and
143.29(25) (20) and (23).
143.30EFFECTIVE DATE.This section is effective the day following final enactment.

143.31    Sec. 39. Minnesota Statutes 2012, section 279.03, subdivision 1, is amended to read:
143.32    Subdivision 1. Rate Interest calculation. The rate of interest on delinquent
143.33property taxes levied in 1979 and prior years is fixed at six percent per year until January
144.11, 1983. Thereafter Interest is payable at the rate determined pursuant to section 549.09.
144.2The rate of interest on delinquent property taxes levied in 1980 and subsequent years is
144.3the rate determined pursuant to section 549.09. All provisions of law except section
144.4549.09 providing for the calculation of interest at any different rate on delinquent taxes in
144.5any notice or proceeding in connection with the payment, collection, sale, or assignment
144.6of delinquent taxes, or redemption from such sale or assignment are hereby amended
144.7to correspond herewith. Section 549.09 shall continue in force applies with respect to
144.8judgments arising out of petitions for review filed pursuant to chapter 278 irrespective of
144.9the levy year.
144.10For property taxes levied in 1980 and prior years, interest is to be calculated at
144.11simple interest from the second Monday in May following the year in which the taxes
144.12become due until the time that the taxes and penalties are paid, computed on the amount
144.13of unpaid taxes, penalties and costs. For property taxes levied in 1981 and subsequent
144.14years, Interest shall commence on the first day of January following the year in which the
144.15taxes become due, but the county treasurer need not calculate interest on unpaid taxes and
144.16penalties on the tax list returned to the county auditor pursuant to section 279.01.
144.17If interest is payable for a portion of a year, the interest is calculated only for the
144.18months that the taxes or penalties remain unpaid, and for this purpose a portion of a month
144.19is deemed to be a whole month.
144.20EFFECTIVE DATE.This section is effective the day following final enactment.

144.21    Sec. 40. Minnesota Statutes 2012, section 279.03, subdivision 1a, is amended to read:
144.22    Subd. 1a. Rate after December 31, 1990. (a) Except as provided in paragraph (b),
144.23interest on delinquent property taxes, penalties, and costs unpaid on or after January 1,
144.241991, shall be is payable at the per annum rate determined in section 270C.40, subdivision
144.255
. If the rate so determined is less than ten percent, the rate of interest shall be is ten
144.26percent. The maximum per annum rate shall be is 14 percent if the rate specified under
144.27section 270C.40, subdivision 5, exceeds 14 percent. The rate shall be is subject to change
144.28on January 1 of each year.
144.29(b) If a person is the owner of one or more parcels of property on which taxes are
144.30delinquent, and the delinquent taxes are more than 25 percent of the prior year's school
144.31district levy, interest on the delinquent property taxes, penalties, and costs unpaid after
144.32January 1, 1992, shall be is payable at twice the rate determined under paragraph (a) for
144.33the year.
144.34EFFECTIVE DATE.This section is effective the day following final enactment.

145.1    Sec. 41. Minnesota Statutes 2012, section 279.16, is amended to read:
145.2279.16 JUDGMENT WHEN NO ANSWER; FORM; ENTRY.
145.3Upon the expiration of 20 days from the later of the filing of the affidavit of
145.4publication or the filing of the affidavit of mailing pursuant to section 279.131, the
145.5court administrator shall enter judgment against each and every such parcel as to which
145.6no answer has been filed, which judgment shall include all such parcels, and shall be
145.7substantially in the following form:
145.8
State of Minnesota
)
District Court,
145.9
) ss.
145.10
County of
.....
)
.............. Judicial District.
145.11In the matter of the proceedings to enforce payment of the taxes on real estate
145.12remaining delinquent on the first Monday in January, ......., for the county of ....................,
145.13state of Minnesota.
145.14A list of taxes on real property, delinquent on the first Monday in January, ......., for
145.15said county of ................., having been duly filed in the office of the court administrator of
145.16this court, and the notice and list required by law having been duly published and mailed
145.17as required by law, and more than 20 days having elapsed since the last publication of the
145.18notice and list, and no answer having been filed by any person, company, or corporation
145.19to the taxes upon any of the parcels of land hereinafter described, it is hereby adjudged
145.20that each parcel of land hereinafter described is liable for taxes, penalties, and costs to the
145.21amount set opposite the same, as follows:
145.22
Description.
Parcel Number.
Amount.
145.23The amount of taxes, penalties, and cost to which, as hereinbefore stated, each of
145.24such parcels of land is liable, is hereby declared a lien upon such parcel of land as against
145.25the estate, right, title, interest, claim, or lien, of whatever nature, in law or equity, of every
145.26person, company, or corporation; and it is adjudged that, unless the amount to which
145.27each of such parcels is liable be paid, each of such parcels be sold, as provided by law,
145.28to satisfy the amount to which it is liable.
145.29
Dated this ............. day of ..............., .......
145.30
145.31
145.32
.....
Court Administrator of the District Court,
County of
.....
145.33The judgment shall be entered by the court administrator in a book to be kept by
145.34the court administrator, to be called the real estate tax judgment book, and signed by the
145.35court administrator. The judgment shall be written out on the left-hand pages of the book,
145.36leaving the right-hand pages blank for the entries in this chapter hereinafter provided; and
146.1 The same presumption in favor of the regularity and validity of the judgment shall be
146.2deemed to exist as in respect to judgments in civil actions in such court, except where taxes
146.3have been paid before the entry of judgment, or where the land is exempt from taxation, in
146.4which cases the judgment shall be prima facie evidence only of its regularity and validity.
146.5EFFECTIVE DATE.This section is effective the day following final enactment.

146.6    Sec. 42. Minnesota Statutes 2012, section 279.23, is amended to read:
146.7279.23 COPY OF JUDGMENT TO COUNTY AUDITOR.
146.8When any real estate tax judgment is entered, the court administrator shall forthwith
146.9 deliver to the county auditor, in a book to be provided by the auditor, a certified copy of
146.10such judgment, which shall be written on the left-hand pages of the book, leaving the
146.11right-hand pages blank.
146.12EFFECTIVE DATE.This section is effective the day following final enactment.

146.13    Sec. 43. Minnesota Statutes 2012, section 279.25, is amended to read:
146.14279.25 PAYMENT BEFORE JUDGMENT.
146.15Before sale any person may pay the amount adjudged against any parcel of land.
146.16If payment is made before entry of judgment, and the delinquent list has been filed with
146.17the court administrator, the county auditor shall immediately certify such payment to the
146.18court administrator, who shall note the same on such delinquent list; and all proceedings
146.19pending against such parcel shall thereupon be discontinued. If payment is made after
146.20judgment is entered and before sale, the auditor shall certify such payment to the clerk,
146.21who, upon production of such certificate and the payment of a fee of ten cents, shall enter
146.22on the right-hand page of the real estate tax judgment book, and opposite the description
146.23of such parcel, satisfaction of the judgment against the same. The auditor shall make
146.24proper records of all payments made under this section.
146.25EFFECTIVE DATE.This section is effective the day following final enactment.

146.26    Sec. 44. Minnesota Statutes 2013 Supplement, section 279.37, subdivision 2, is
146.27amended to read:
146.28    Subd. 2. Installment payments. The owner of any such parcel, or any person to
146.29whom the right to pay taxes has been given by statute, mortgage, or other agreement, may
146.30make and file with the county auditor of the county in which the parcel is located a written
146.31offer to pay the current taxes each year before they become delinquent, or to contest the
147.1taxes under Minnesota Statutes 1941, sections 278.01 to 278.13 chapter 278, and agree
147.2to confess judgment for the amount provided, as determined by the county auditor. By
147.3filing the offer, the owner waives all irregularities in connection with the tax proceedings
147.4affecting the parcel and any defense or objection which the owner may have to the
147.5proceedings, and also waives the requirements of any notice of default in the payment of
147.6any installment or interest to become due pursuant to the composite judgment to be so
147.7entered. Unless the property is subject to subdivision 1a, with the offer, the owner shall (i)
147.8tender one-tenth of the amount of the delinquent taxes, costs, penalty, and interest, and
147.9(ii) tender all current year taxes and penalty due at the time the confession of judgment is
147.10entered. In the offer, the owner shall agree to pay the balance in nine equal installments,
147.11with interest as provided in section 279.03, payable annually on installments remaining
147.12unpaid from time to time, on or before December 31 of each year following the year in
147.13which judgment was confessed. The offer must be substantially as follows:
147.14"To the court administrator of the district court of ........... county, I, .....................,
147.15am the owner of the following described parcel of real estate located in ....................
147.16county, Minnesota:
147.17.............................. Upon that real estate there are delinquent taxes for the year ........., and
147.18prior years, as follows: (here insert year of delinquency and the total amount of delinquent
147.19taxes, costs, interest, and penalty). By signing this document I offer to confess judgment in
147.20the sum of $...... and waive all irregularities in the tax proceedings affecting these taxes and
147.21any defense or objection which I may have to them, and direct judgment to be entered for
147.22the amount stated above, minus the sum of $............, to be paid with this document, which
147.23is one-tenth or one-fifth of the amount of the taxes, costs, penalty, and interest stated above.
147.24I agree to pay the balance of the judgment in nine or four equal, annual installments, with
147.25interest as provided in section 279.03, payable annually, on the installments remaining
147.26unpaid. I agree to pay the installments and interest on or before December 31 of each year
147.27following the year in which this judgment is confessed and current taxes each year before
147.28they become delinquent, or within 30 days after the entry of final judgment in proceedings
147.29to contest the taxes under Minnesota Statutes, sections 278.01 to 278.13 chapter 278.
147.30Dated .............., ......."
147.31EFFECTIVE DATE.This section is effective the day following final enactment.

147.32    Sec. 45. Minnesota Statutes 2012, section 280.001, is amended to read:
147.33280.001 PUBLIC SALES, AUDITOR'S CERTIFICATES ABOLISHED.
148.1Effective the second Monday in May 1974, and each year thereafter, No parcel of
148.2land against which judgment has been entered and remains unsatisfied for the taxes of
148.3the preceding year or years may be sold at public vendue as provided in sections 280.01
148.4and 280.02 by the county auditor but shall be treated in the same manner and regarded in
148.5all respects as land bid in for the state by the auditor in the manner provided in section
148.6280.02 . No notice of sale required by section 280.01 shall be published or posted in 1974
148.7and in years thereafter, and no auditor's certificate authorized by section 280.03 shall be
148.8issued on the second Monday in May 1974, or thereafter.
148.9EFFECTIVE DATE.This section is effective the day following final enactment.

148.10    Sec. 46. Minnesota Statutes 2012, section 280.03, is amended to read:
148.11280.03 CERTIFICATE OF SALE.
148.12The county auditor shall execute to the purchaser of each parcel a certificate which
148.13may be substantially in the following form:
148.14"I, .........., auditor of the county of .........., state of Minnesota, do hereby certify that
148.15at the sale of lands pursuant to the real estate tax judgment entered in the district court
148.16in the county of .........., on the .......... day of .........., ......., in proceedings to enforce the
148.17payment of taxes delinquent on real estate for the years .........., for the county of ..........,
148.18which sale was held at ..............., in said county of ........, on the ........ day of ........, .......,
148.19the following described parcel of land, situate in said county of .........., state of Minnesota:
148.20(insert description), was offered for sale to the bidder who should offer to pay the amount
148.21for which the same was to be sold, at the lowest annual rate of interest on such amount;
148.22and at said sale I did sell the said parcel of land to .......... for the sum of .......... dollars,
148.23with interest at .......... percent per annum on such amount, that being the sum for which the
148.24same was to be sold, and such rate of interest being the lowest rate percent per annum bid
148.25on such sum; and, the sum having been paid, I do therefore, in consideration thereof, and
148.26pursuant to the statute in such case made and provided, convey the said parcel of land, in
148.27fee simple, subject to easements and restrictions of record at the date of the tax judgment
148.28sale, including, but without limitation, permits for telephone, telegraph and electric
148.29power lines either by underground cable or conduit or otherwise, sewer and water lines,
148.30highways, railroads, and pipe lines for gas, liquids, or solids in suspension, to said ..........,
148.31and the heirs and assigns of ......., forever, subject to redemption as provided by law.
148.32Witness my hand and official seal this ........ day of ........, ....... .
148.33
148.34
.....
County Auditor."
149.1If the land shall not be redeemed as provided in chapter 281, such certificate shall
149.2pass to the purchaser an estate therein, in fee simple, without any other act or deed
149.3whatever subject to easements and restrictions of record at the date of the tax judgment
149.4sale, including, but without limitation, permits for telephone, telegraph, and electric
149.5power lines either by underground cable or conduit or otherwise, sewer and water lines,
149.6highways, railroads, and pipe lines for gas, liquids, or solids in suspension. Such certificate
149.7may be recorded, after the time for redemption shall have expired, as other deeds of real
149.8estate, and with like effect. If any purchaser at such sale shall purchase more than one
149.9parcel, the auditor shall issue to the purchaser a certificate for each parcel so purchased.
149.10EFFECTIVE DATE.This section is effective the day following final enactment.

149.11    Sec. 47. Minnesota Statutes 2012, section 280.07, is amended to read:
149.12280.07 ENTRIES IN JUDGMENT BOOKS AFTER SALE.
149.13Immediately after such sale the county auditor shall set out in the copy judgment
149.14book record that all parcels were bid in for the state. The county auditor shall thereupon
149.15deliver such book to notify the court administrator, who shall forthwith enter on the
149.16right-hand page of the real estate tax judgment book, opposite the description of each
149.17parcel sold, the words "bid in for the state," and thereupon redeliver the copy judgment
149.18book to the auditor. Upon redemption the auditor shall make a note thereon in the copy
149.19judgment book, opposite the parcel redeemed.
149.20EFFECTIVE DATE.This section is effective the day following final enactment.

149.21    Sec. 48. Minnesota Statutes 2012, section 280.11, is amended to read:
149.22280.11 LANDS BID IN FOR STATE.
149.23At any time after any parcel of land has been bid in for the state, the same not having
149.24been redeemed, the county auditor shall assign and convey the same, and all the right of
149.25the state therein acquired at such sale, to any person who shall pay the amount for which
149.26the same was bid in, with interest at the rate of 12 percent per annum, and the amount of
149.27all subsequent delinquent taxes, penalties, costs, and interest at such rate upon the same
149.28from the time when such taxes became delinquent. The county auditor shall execute to
149.29such person a certificate for such parcel, which may be substantially in the following form:
149.30"I, .........., auditor of the county of .........., state of Minnesota, do hereby certify that
149.31at the sale of lands pursuant to the real estate tax judgment entered in the district court
149.32in the county of .........., on the .......... day of .........., ......., in proceedings to enforce the
149.33payment of taxes delinquent upon real estate for the years .......... for the county of ..........,
150.1which sale was held at .........., in said county of .........., on the .......... day of .........., .......,
150.2the following described parcel of land, situate in said county of .........., state of Minnesota:
150.3(insert description), was duly offered for sale; and, no one bidding upon such offer an
150.4amount equal to that for which the parcel was subject to be sold, the same was then bid in
150.5for the state at such amount, being the sum of .......... dollars; and the same still remaining
150.6unredeemed, and on this day .......... having paid into the treasury of the county the amount
150.7for which the same was so bid in, and all subsequent delinquent taxes, penalties, costs,
150.8and interest, amounting in all to .......... dollars, therefore, in consideration thereof, and
150.9pursuant to the statute in such case made and provided, I do hereby assign and convey this
150.10parcel of land, in fee simple, subject to easements and restrictions of record at the date of
150.11the tax judgment sale, including but without limitation, permits for telephone, telegraph,
150.12 and electric power lines either by underground cable or conduit or otherwise, sewer and
150.13water lines, highways, railroads, and pipe lines for gas, liquids, or solids in suspension,
150.14with all the right, title and interest of the state acquired therein at such sale to .........., and
150.15the heirs and assigns of ........, forever, subject to redemption as provided by law.
150.16Witness my hand and official seal this .......... day of .........., .......
150.17
150.18
.....
County Auditor."
150.19If the land shall not be redeemed, as provided in chapter 281, such certificate shall
150.20pass to the purchaser or assignee an estate therein, in fee simple, without any other act
150.21or deed whatever subject to easements and restrictions of record at the date of the tax
150.22judgment sale, including, but without limitation, permits for telephone, telegraph and
150.23electric power lines either by underground cable or conduit or otherwise, sewer and water
150.24lines, highways, railroads, and pipe lines for gas, liquids, or solids in suspension. Such
150.25certificate or conveyance may be recorded, after the time for redemption shall have
150.26expired, as other deeds of real estate, and with like effect. No assignment of the right of
150.27the state shall be given pursuant to this section after January 1, 1972.
150.28EFFECTIVE DATE.This section is effective the day following final enactment.

150.29    Sec. 49. Minnesota Statutes 2012, section 281.03, is amended to read:
150.30281.03 AUDITOR'S CERTIFICATE.
150.31The county auditor shall certify to the amount due on such redemption, and, on
150.32payment of the same to the county treasurer, shall make duplicate receipts for the certified
150.33amount, describing the property redeemed, one of which shall be filed with the auditor.
150.34Such receipts shall be governed by the provisions of this chapter regulating the payment
150.35of current taxes and such payment shall have the effect to annul the sale. If the amount
151.1certified by the auditor and received in payment for redemption be less than that required
151.2by law, it shall not invalidate the redemption. On redemption being made, the auditor shall
151.3enter upon the copy of the tax judgment book, opposite the description of record the
151.4parcel as redeemed, the word, "redeemed.".
151.5EFFECTIVE DATE.This section is effective the day following final enactment.

151.6    Sec. 50. Minnesota Statutes 2013 Supplement, section 281.17, is amended to read:
151.7281.17 PERIOD FOR REDEMPTION.
151.8Except for properties for which the period of redemption has been limited under
151.9sections 281.173 and 281.174, the following periods for redemption apply.
151.10The period of redemption for all lands sold to the state at a tax judgment sale shall
151.11be three years from the date of sale to the state of Minnesota.
151.12The period of redemption for homesteaded lands as defined in section 273.13,
151.13subdivision 22
, located in a targeted neighborhood as defined in Laws 1987, chapter 386,
151.14article 6, section 4, and sold to the state at a tax judgment sale is three years from the date
151.15of sale. The period of redemption for all lands located in a targeted neighborhood as
151.16defined in Laws 1987, chapter 386, article 6, section 4, except (1) homesteaded lands as
151.17defined in section 273.13, subdivision 22, and (2) for periods of redemption beginning
151.18after June 30, 1991, but before July 1, 1996, lands located in the Loring Park targeted
151.19neighborhood on which a notice of lis pendens has been served, and sold to the state at a
151.20tax judgment sale is one year from the date of sale.
151.21The period of redemption for all real property constituting a mixed municipal solid
151.22waste disposal facility that is a qualified facility under section 115B.39, subdivision 1, is
151.23one year from the date of the sale to the state of Minnesota.
151.24EFFECTIVE DATE.This section is effective the day following final enactment.

151.25    Sec. 51. Minnesota Statutes 2012, section 281.327, is amended to read:
151.26281.327 CANCELLATION OF CERTIFICATE UPON JUDICIAL ORDER.
151.27Upon the petition of any person interested in the land covered by a real estate tax
151.28sale certificate, state assignment certificate, or forfeited tax sale certificate and, upon the
151.29giving of such notice to the holder of such certificate as may be ordered, the district court,
151.30in the proceedings resulting in the judgment upon which a real estate tax judgment sale
151.31certificate, state assignment certificate, or forfeited tax sale certificate is based, may order
151.32the cancellation of a real estate tax judgment sale certificate, state assignment certificate,
151.33or forfeited tax sale certificate upon which notice of expiration of time of redemption
152.1has been issued when the certificate or a deed issued thereon has not been recorded in
152.2the office of the county recorder or filed in that of the registrar of titles, if the land is
152.3registered, within seven years after the date of the issuance of such certificate; the county
152.4auditor, on the filing of the order, shall make an entry in the proper copy real estate tax
152.5judgment book, opposite the description of the land, "canceled by order of court" record
152.6the land as canceled by order of court; and the rights of the holder under the certificate
152.7shall thereupon be terminated of record in the office of the county auditor.
152.8EFFECTIVE DATE.This section is effective the day following final enactment.

152.9    Sec. 52. Minnesota Statutes 2012, section 282.01, subdivision 6, is amended to read:
152.10    Subd. 6. Duties of commissioner after sale. When any sale has been made by the
152.11county auditor under sections 282.01 to 282.13, the auditor shall immediately certify to
152.12the commissioner of revenue such information relating to such sale, on such forms as the
152.13commissioner of revenue may prescribe as will enable the commissioner of revenue to
152.14prepare an appropriate deed if the sale is for cash, or keep necessary records if the sale
152.15is on terms; and not later than October 31 of each year the county auditor shall submit
152.16to the commissioner of revenue a statement of all instances wherein any payment of
152.17principal, interest, or current taxes on lands held under certificate, due or to be paid during
152.18the preceding calendar years, are still outstanding at the time such certificate is made.
152.19When such statement shows that a purchaser or the purchaser's assignee is in default, the
152.20commissioner of revenue may instruct the county board of the county in which the land is
152.21located to cancel said certificate of sale in the manner provided by subdivision 5, provided
152.22that upon recommendation of the county board, and where the circumstances are such
152.23that the commissioner of revenue after investigation is satisfied that the purchaser has
152.24made every effort reasonable to make payment of both the annual installment and said
152.25taxes, and that there has been no willful neglect on the part of the purchaser in meeting
152.26these obligations, then the commissioner of revenue may extend the time for the payment
152.27for such period as the commissioner may deem warranted, not to exceed one year. On
152.28payment in full of the purchase price, appropriate conveyance in fee, in such form as may
152.29be prescribed by the attorney general, shall be issued by the commissioner of revenue,
152.30which conveyance must be recorded by the county and shall have the force and effect of
152.31a patent from the state subject to easements and restrictions of record at the date of the
152.32tax judgment sale, including, but without limitation, permits for telephone, telegraph, and
152.33electric power lines either by underground cable or conduit or otherwise, sewer and water
152.34lines, highways, railroads, and pipe lines for gas, liquids, or solids in suspension.
153.1EFFECTIVE DATE.This section is effective the day following final enactment.

153.2    Sec. 53. Minnesota Statutes 2012, section 282.04, subdivision 4, is amended to read:
153.3    Subd. 4. Easements. The county auditor, when and for such price and on such
153.4terms and for such period as the county board prescribes, may grant easements or permits
153.5on unsold tax-forfeited land for telephone, telegraph, and electric power lines either by
153.6underground cable or conduit or otherwise, sewer and water lines, highways, recreational
153.7trails, railroads, and pipe lines for gas, liquids, or solids in suspension. Any such easement
153.8or permit may be canceled by resolution of the county board after reasonable notice for
153.9any substantial breach of its terms or if at any time its continuance will conflict with
153.10public use of the land, or any part thereof, on which it is granted. Land affected by any
153.11such easement or permit may be sold or leased for mineral or other legal purpose, but sale
153.12or lease shall be subject to the easement or permit, and all rights granted by the easement
153.13or permit shall be excepted from the conveyance or lease of the land and be reserved,
153.14and may be canceled by the county board in the same manner and for the same reasons
153.15as it could have been canceled before sale and in that case the rights granted thereby
153.16shall vest in the state in trust as the land on which it was granted was held before sale or
153.17lease. Any easement or permit granted before passage of Laws 1951, Chapter 203, may
153.18be governed thereby if the holder thereof and county board so agree. Reasonable notice
153.19as used in this subdivision, means a 90-day written notice addressed to the record owner
153.20of the easement at the last known address, and upon cancellation the county board may
153.21grant extensions of time to vacate the premises affected.
153.22EFFECTIVE DATE.This section is effective the day following final enactment.

153.23    Sec. 54. Minnesota Statutes 2012, section 282.261, subdivision 2, is amended to read:
153.24    Subd. 2. Interest rate. The unpaid balance on any repurchase contract approved
153.25by the county board on or after July 1, 1982, is subject to interest at the rate determined
153.26pursuant to section 549.09. Repurchase contracts approved after December 31, 1990, are
153.27subject to interest at the rate determined in section 279.03, subdivision 1a. The interest
153.28rate is subject to change each year on the unpaid balance in the manner provided for rate
153.29changes in section 549.09 or 279.03, subdivision 1a, whichever is applicable. Interest on
153.30the unpaid contract balance on repurchases approved before July 1, 1982, is payable at the
153.31rate applicable to the repurchase contract at the time that it was approved.
153.32EFFECTIVE DATE.This section is effective the day following final enactment.

154.1    Sec. 55. Minnesota Statutes 2012, section 282.261, subdivision 4, is amended to read:
154.2    Subd. 4. Service fee. The county auditor may collect a service fee to cover
154.3administrative costs as set by the county board for each repurchase application received
154.4after July 1, 1985. The fee must be paid at the time of application and must be credited to
154.5the county general revenue fund.
154.6EFFECTIVE DATE.This section is effective the day following final enactment.

154.7    Sec. 56. Minnesota Statutes 2012, section 282.261, subdivision 5, is amended to read:
154.8    Subd. 5. County may impose conditions of repurchase. The county auditor, after
154.9receiving county board approval, may impose conditions on repurchase of tax-forfeited
154.10lands limiting the use of the parcel subject to the repurchase, including, but not limited to,
154.11environmental remediation action plan restrictions or covenants, or easements for lines or
154.12equipment for telephone, telegraph, electric power, or telecommunications.
154.13EFFECTIVE DATE.This section is effective the day following final enactment.

154.14    Sec. 57. Minnesota Statutes 2012, section 282.322, is amended to read:
154.15282.322 FORFEITED LANDS LIST.
154.16The county board of any county may at any time after the passage of Laws 1945,
154.17chapter 296, file a list of forfeited lands with the county auditor, if the board is of the
154.18opinion that such lands may be acquired by the state or any municipal subdivision thereof
154.19for public purposes. Upon the filing of such list the county auditor shall withhold said
154.20lands from repurchase. If no proceeding shall be started to acquire such lands by the
154.21state or some municipal subdivision thereof within one year after the filing of such list
154.22the county board shall withdraw said list and thereafter the owner shall have one year in
154.23which to repurchase as otherwise provided in Laws 1945, chapter 296.
154.24EFFECTIVE DATE.This section is effective the day following final enactment.

154.25    Sec. 58. Minnesota Statutes 2012, section 287.30, is amended to read:
154.26287.30 COUNTY TREASURER; DUTIES.
154.27The care of documentary stamps entrusted to county treasurers and the duties imposed
154.28upon county treasurers by this chapter are within the duties of such office and are within
154.29the coverage of any official bond delivered to the state, conditioned that any such officer
154.30shall faithfully execute the duties of office. The county board may by resolution require
154.31the county auditor to perform any duty imposed on the county treasurer under this chapter.
155.1EFFECTIVE DATE.This section is effective the day following final enactment.

155.2    Sec. 59. Minnesota Statutes 2012, section 289A.25, subdivision 1, is amended to read:
155.3    Subdivision 1. Requirements to pay. An individual, trust, S corporation, or
155.4partnership must, when prescribed in subdivision 3, paragraph (b), make payments of
155.5estimated tax. For individuals, the term "estimated tax" means the amount the taxpayer
155.6estimates is the sum of the taxes imposed by chapter 290 for the taxable year. For trusts,
155.7S corporations, and partnerships, the term estimated tax means the amount the taxpayer
155.8estimates is the sum of the taxes for the taxable year imposed by chapter 290 and the
155.9composite income tax imposed by section 289A.08, subdivision 7. If the individual is an
155.10infant or incompetent person, the payments must be made by the individual's guardian. If
155.11joint payments on estimated tax are made but a joint return is not made for the taxable
155.12year, the estimated tax for that year may be treated as the estimated tax of either the
155.13husband or the wife or may be divided between them.
155.14Notwithstanding the provisions of this section, no payments of estimated tax are
155.15required if the estimated tax, as defined in this subdivision, less the credits allowed against
155.16the tax, is less than $500.
155.17EFFECTIVE DATE.This section is effective the day following final enactment.

155.18    Sec. 60. Minnesota Statutes 2012, section 290.01, subdivision 5, is amended to read:
155.19    Subd. 5. Domestic corporation. The term "domestic" when applied to a corporation
155.20means a corporation:
155.21(1) created or organized in the United States, or under the laws of the United
155.22States or of any state, the District of Columbia, or any political subdivision of any of
155.23the foregoing but not including the Commonwealth of Puerto Rico, or any possession
155.24of the United States; or
155.25(2) which qualifies as a DISC, as defined in section 992(a) of the Internal Revenue
155.26Code; or.
155.27(3) which qualifies as a FSC, as defined in section 922 of the Internal Revenue Code.
155.28EFFECTIVE DATE.This section is effective for taxable years beginning after
155.29December 31, 2013.

155.30    Sec. 61. Minnesota Statutes 2013 Supplement, section 290.01, subdivision 19d,
155.31is amended to read:
156.1    Subd. 19d. Corporations; modifications decreasing federal taxable income. For
156.2corporations, there shall be subtracted from federal taxable income after the increases
156.3provided in subdivision 19c:
156.4    (1) the amount of foreign dividend gross-up added to gross income for federal
156.5income tax purposes under section 78 of the Internal Revenue Code;
156.6    (2) the amount of salary expense not allowed for federal income tax purposes due to
156.7claiming the work opportunity credit under section 51 of the Internal Revenue Code;
156.8    (3) any dividend (not including any distribution in liquidation) paid within the
156.9taxable year by a national or state bank to the United States, or to any instrumentality of
156.10the United States exempt from federal income taxes, on the preferred stock of the bank
156.11owned by the United States or the instrumentality;
156.12    (4) amounts disallowed for intangible drilling costs due to differences between
156.13this chapter and the Internal Revenue Code in taxable years beginning before January
156.141, 1987, as follows:
156.15    (i) to the extent the disallowed costs are represented by physical property, an amount
156.16equal to the allowance for depreciation under Minnesota Statutes 1986, section 290.09,
156.17subdivision 7
, subject to the modifications contained in subdivision 19e; and
156.18    (ii) to the extent the disallowed costs are not represented by physical property, an
156.19amount equal to the allowance for cost depletion under Minnesota Statutes 1986, section
156.20290.09, subdivision 8;
156.21    (5) (4) the deduction for capital losses pursuant to sections 1211 and 1212 of the
156.22Internal Revenue Code, except that:
156.23    (i) for capital losses incurred in taxable years beginning after December 31, 1986,
156.24capital loss carrybacks shall not be allowed;
156.25    (ii) for capital losses incurred in taxable years beginning after December 31, 1986,
156.26a capital loss carryover to each of the 15 taxable years succeeding the loss year shall be
156.27allowed;
156.28    (iii) for capital losses incurred in taxable years beginning before January 1, 1987, a
156.29capital loss carryback to each of the three taxable years preceding the loss year, subject to
156.30the provisions of Minnesota Statutes 1986, section 290.16, shall be allowed; and
156.31    (iv) for capital losses incurred in taxable years beginning before January 1, 1987,
156.32a capital loss carryover to each of the five taxable years succeeding the loss year to the
156.33extent such loss was not used in a prior taxable year and subject to the provisions of
156.34Minnesota Statutes 1986, section 290.16, shall be allowed;
156.35    (6) (5) an amount for interest and expenses relating to income not taxable for federal
156.36income tax purposes, if (i) the income is taxable under this chapter and (ii) the interest and
157.1expenses were disallowed as deductions under the provisions of section 171(a)(2), 265 or
157.2291 of the Internal Revenue Code in computing federal taxable income;
157.3    (7) (6) in the case of mines, oil and gas wells, other natural deposits, and timber for
157.4which percentage depletion was disallowed pursuant to subdivision 19c, clause (8), a
157.5reasonable allowance for depletion based on actual cost. In the case of leases the deduction
157.6must be apportioned between the lessor and lessee in accordance with rules prescribed
157.7by the commissioner. In the case of property held in trust, the allowable deduction must
157.8be apportioned between the income beneficiaries and the trustee in accordance with the
157.9pertinent provisions of the trust, or if there is no provision in the instrument, on the basis
157.10of the trust's income allocable to each;
157.11    (8) (7) for certified pollution control facilities placed in service in a taxable year
157.12beginning before December 31, 1986, and for which amortization deductions were elected
157.13under section 169 of the Internal Revenue Code of 1954, as amended through December
157.1431, 1985, an amount equal to the allowance for depreciation under Minnesota Statutes
157.151986, section 290.09, subdivision 7;
157.16    (9) (8) amounts included in federal taxable income that are due to refunds of
157.17income, excise, or franchise taxes based on net income or related minimum taxes paid
157.18by the corporation to Minnesota, another state, a political subdivision of another state,
157.19the District of Columbia, or a foreign country or possession of the United States to the
157.20extent that the taxes were added to federal taxable income under subdivision 19c, clause
157.21(1), in a prior taxable year;
157.22    (10) (9) income or gains from the business of mining as defined in section 290.05,
157.23subdivision 1
, clause (a), that are not subject to Minnesota franchise tax;
157.24    (11) (10) the amount of disability access expenditures in the taxable year which are not
157.25allowed to be deducted or capitalized under section 44(d)(7) of the Internal Revenue Code;
157.26    (12) (11) the amount of qualified research expenses not allowed for federal income
157.27tax purposes under section 280C(c) of the Internal Revenue Code, but only to the extent
157.28that the amount exceeds the amount of the credit allowed under section 290.068;
157.29    (13) (12) the amount of salary expenses not allowed for federal income tax purposes
157.30due to claiming the Indian employment credit under section 45A(a) of the Internal
157.31Revenue Code;
157.32    (14) (13) any decrease in subpart F income, as defined in section 952(a) of the
157.33Internal Revenue Code, for the taxable year when subpart F income is calculated without
157.34regard to the provisions of Division C, title III, section 303(b) of Public Law 110-343;
157.35    (15) (14) in each of the five tax years immediately following the tax year in which
157.36an addition is required under subdivision 19c, clause (12), an amount equal to one-fifth
158.1of the delayed depreciation. For purposes of this clause, "delayed depreciation" means
158.2the amount of the addition made by the taxpayer under subdivision 19c, clause (12). The
158.3resulting delayed depreciation cannot be less than zero;
158.4    (16) (15) in each of the five tax years immediately following the tax year in which an
158.5addition is required under subdivision 19c, clause (13), an amount equal to one-fifth of the
158.6amount of the addition;
158.7(17) (16) to the extent included in federal taxable income, discharge of indebtedness
158.8income resulting from reacquisition of business indebtedness included in federal taxable
158.9income under section 108(i) of the Internal Revenue Code. This subtraction applies only
158.10to the extent that the income was included in net income in a prior year as a result of the
158.11addition under subdivision 19c, clause (16); and
158.12(18) (17) the amount of expenses not allowed for federal income tax purposes due
158.13to claiming the railroad track maintenance credit under section 45G(a) of the Internal
158.14Revenue Code.
158.15EFFECTIVE DATE.This section is effective for taxable years beginning after
158.16December 31, 2013.

158.17    Sec. 62. Minnesota Statutes 2012, section 290.01, subdivision 19f, is amended to read:
158.18    Subd. 19f. Basis modifications affecting gain or loss on disposition of property.
158.19(a) For individuals, estates, and trusts, the basis of property is its adjusted basis for federal
158.20income tax purposes except as set forth in paragraphs (e) and (f), (g), and (m). For
158.21corporations, the basis of property is its adjusted basis for federal income tax purposes,
158.22without regard to the time when the property became subject to tax under this chapter or to
158.23whether out-of-state losses or items of tax preference with respect to the property were not
158.24deductible under this chapter, except that the modifications to the basis for federal income
158.25tax purposes set forth in paragraphs (b) to (j) (i) are allowed to corporations, and the
158.26resulting modifications to federal taxable income must be made in the year in which gain
158.27or loss on the sale or other disposition of property is recognized.
158.28(b) The basis of property shall not be reduced to reflect federal investment tax credit.
158.29(c) The basis of property subject to the accelerated cost recovery system under
158.30section 168 of the Internal Revenue Code shall be modified to reflect the modifications in
158.31depreciation with respect to the property provided for in subdivision 19e. For certified
158.32pollution control facilities for which amortization deductions were elected under section
158.33169 of the Internal Revenue Code of 1954, the basis of the property must be increased by
158.34the amount of the amortization deduction not previously allowed under this chapter.
159.1(d) For property acquired before January 1, 1933, the basis for computing a gain is
159.2the fair market value of the property as of that date. The basis for determining a loss is
159.3the cost of the property to the taxpayer less any depreciation, amortization, or depletion,
159.4actually sustained before that date. If the adjusted cost exceeds the fair market value of the
159.5property, then the basis is the adjusted cost regardless of whether there is a gain or loss.
159.6(e) (d) The basis is reduced by the allowance for amortization of bond premium if
159.7an election to amortize was made pursuant to Minnesota Statutes 1986, section 290.09,
159.8subdivision 13, and the allowance could have been deducted by the taxpayer under this
159.9chapter during the period of the taxpayer's ownership of the property.
159.10(f) (e) For assets placed in service before January 1, 1987, corporations, partnerships,
159.11or individuals engaged in the business of mining ores other than iron ore or taconite
159.12concentrates subject to the occupation tax under chapter 298 must use the occupation
159.13tax basis of property used in that business.
159.14(g) (f) For assets placed in service before January 1, 1990, corporations, partnerships,
159.15or individuals engaged in the business of mining iron ore or taconite concentrates subject
159.16to the occupation tax under chapter 298 must use the occupation tax basis of property
159.17used in that business.
159.18(h) (g) In applying the provisions of sections 301(c)(3)(B), 312(f) and (g), and
159.19316(a)(1) of the Internal Revenue Code, the dates December 31, 1932, and January 1,
159.201933, shall be substituted for February 28, 1913, and March 1, 1913, respectively.
159.21(i) (h) In applying the provisions of section 362(a) and (c) of the Internal Revenue
159.22Code, the date December 31, 1956, shall be substituted for June 22, 1954.
159.23(j) (i) The basis of property shall be increased by the amount of intangible drilling
159.24costs not previously allowed due to differences between this chapter and the Internal
159.25Revenue Code.
159.26(k) (j) The adjusted basis of any corporate partner's interest in a partnership is
159.27the same as the adjusted basis for federal income tax purposes modified as required to
159.28reflect the basis modifications set forth in paragraphs (b) to (j) (i). The adjusted basis
159.29of a partnership in which the partner is an individual, estate, or trust is the same as the
159.30adjusted basis for federal income tax purposes modified as required to reflect the basis
159.31modifications set forth in paragraphs (e) and (f) and (g).
159.32(l) (k) The modifications contained in paragraphs (b) to (j) (i) also apply to the basis
159.33of property that is determined by reference to the basis of the same property in the hands
159.34of a different taxpayer or by reference to the basis of different property.
159.35EFFECTIVE DATE.This section is effective for taxable years beginning after
159.36December 31, 2013.

160.1    Sec. 63. Minnesota Statutes 2012, section 290.01, subdivision 29, is amended to read:
160.2    Subd. 29. Taxable income. The term "taxable income" means:
160.3(1) for individuals, estates, and trusts, the same as taxable net income;
160.4(2) for corporations, the taxable net income less
160.5(i) the net operating loss deduction under section 290.095;
160.6(ii) the dividends received deduction under section 290.21, subdivision 4; and
160.7(iii) the exemption for operating in a job opportunity building zone under section
160.8469.317 ; and.
160.9(iv) the exemption for operating in a biotechnology and health sciences industry
160.10zone under section 469.337.
160.11EFFECTIVE DATE.This section is effective for taxable years beginning after
160.12December 31, 2013.

160.13    Sec. 64. Minnesota Statutes 2012, section 290.015, subdivision 1, is amended to read:
160.14    Subdivision 1. General rule. (a) Except as provided in subdivision 3, a person
160.15that conducts a trade or business that has a place of business in this state, regularly has
160.16employees or independent contractors conducting business activities on its behalf in this
160.17state, or owns or leases real property that is located in this state or tangible personal
160.18property, including but not limited to mobile property, that is present in this state is subject
160.19to the taxes imposed by this chapter.
160.20(b) Except as provided in subdivision 3, a person that conducts a trade or business
160.21not described in paragraph (a) is subject to the taxes imposed by this chapter if the trade
160.22or business obtains or regularly solicits business from within this state, without regard
160.23to physical presence in this state.
160.24(c) For purposes of paragraph (b), business from within this state includes, but is
160.25not limited to:
160.26(1) sales of products or services of any kind or nature to customers in this state who
160.27receive the product or service in this state;
160.28(2) sales of services which are performed from outside this state but the services
160.29are received in this state;
160.30(3) transactions with customers in this state that involve intangible property and
160.31result in receipts attributed to this state as provided in section 290.191, subdivision 5 or 6;
160.32(4) leases of tangible personal property that is located in this state as defined in
160.33section 290.191, subdivision 5, paragraph (g), or 6, paragraph (e); and
160.34(5) sales and leases of real property located in this state.
160.35(d) For purposes of paragraph (b), solicitation includes, but is not limited to:
161.1(1) the distribution, by mail or otherwise, without regard to the state from which such
161.2distribution originated or in which the materials were prepared, of catalogs, periodicals,
161.3advertising flyers, or other written solicitations of business to customers in this state;
161.4(2) display of advertisements on billboards or other outdoor advertising in this state;
161.5(3) advertisements in newspapers published in this state;
161.6(4) advertisements in trade journals or other periodicals, the circulation of which is
161.7primarily within this state;
161.8(5) advertisements in a Minnesota edition of a national or regional publication or a
161.9limited regional edition of which this state is included of a broader regional or national
161.10publication which are not placed in other geographically defined editions of the same issue
161.11of the same publication;
161.12(6) advertisements in regional or national publications in an edition which is not
161.13by its contents geographically targeted to Minnesota, but which is sold over the counter
161.14in Minnesota or by subscription to Minnesota residents;
161.15(7) advertisements broadcast on a radio or television station located in Minnesota; or
161.16(8) any other solicitation by telegraph, telephone, computer database, cable, optic,
161.17microwave, or other communication system.
161.18EFFECTIVE DATE.This section is effective the day following final enactment.

161.19    Sec. 65. Minnesota Statutes 2012, section 290.07, subdivision 1, is amended to read:
161.20    Subdivision 1. Annual accounting period. Net income and taxable net income
161.21shall be computed upon the basis of the taxpayer's annual accounting period. If a taxpayer
161.22has no annual accounting period, or has one other than a fiscal year, as heretofore defined,
161.23 the net income and taxable net income shall be computed on the basis of the calendar year.
161.24Taxpayers shall employ the same accounting period on which they report, or would be
161.25required to report, their net income under the Internal Revenue Code. The commissioner
161.26shall provide by rule for the determination of the accounting period for taxpayers who file
161.27a combined report under section 290.17, subdivision 4, when members of the group use
161.28different accounting periods for federal income tax purposes. Unless the taxpayer changes
161.29its accounting period for federal purposes, the due date of the return is not changed.
161.30    A taxpayer may change accounting periods only with the consent of the
161.31commissioner. In case of any such change, the taxpayer shall pay a tax for the period
161.32not included in either the taxpayer's former or newly adopted taxable year, computed as
161.33provided in section 290.32.
162.1EFFECTIVE DATE.This section is effective for taxable years beginning after
162.2December 31, 2013.

162.3    Sec. 66. Minnesota Statutes 2012, section 290.07, subdivision 2, is amended to read:
162.4    Subd. 2. Accounting methods. Except as specifically provided to the contrary by
162.5this chapter, net income and taxable net income shall be computed in accordance with
162.6the method of accounting regularly employed in keeping the taxpayer's books. If no such
162.7accounting system has been regularly employed, or if that employed does not clearly or
162.8fairly reflect income or the income taxable under this chapter, the computation shall be
162.9made in accordance with such method as in the opinion of the commissioner does clearly
162.10and fairly reflect income and the income taxable under this chapter.
162.11Except as otherwise expressly provided in this chapter, a taxpayer who changes the
162.12method of accounting for regularly computing the taxpayer's income in keeping books
162.13shall, before computing net income and taxable net income under the new method, secure
162.14the consent of the commissioner.
162.15EFFECTIVE DATE.This section is effective for taxable years beginning after
162.16December 31, 2013.

162.17    Sec. 67. Minnesota Statutes 2013 Supplement, section 290.0921, subdivision 3,
162.18is amended to read:
162.19    Subd. 3. Alternative minimum taxable income. "Alternative minimum taxable
162.20income" is Minnesota net income as defined in section 290.01, subdivision 19, and
162.21includes the adjustments and tax preference items in sections 56, 57, 58, and 59(d), (e),
162.22(f), and (h) of the Internal Revenue Code. If a corporation files a separate company
162.23Minnesota tax return, the minimum tax must be computed on a separate company basis.
162.24If a corporation is part of a tax group filing a unitary return, the minimum tax must be
162.25computed on a unitary basis. The following adjustments must be made.
162.26(1) For purposes of the depreciation adjustments under section 56(a)(1) and
162.2756(g)(4)(A) of the Internal Revenue Code, the basis for depreciable property placed in
162.28service in a taxable year beginning before January 1, 1990, is the adjusted basis for federal
162.29income tax purposes, including any modification made in a taxable year under section
162.30290.01, subdivision 19e, or Minnesota Statutes 1986, section 290.09, subdivision 7,
162.31paragraph (c).
162.32For taxable years beginning after December 31, 2000, the amount of any remaining
162.33modification made under section 290.01, subdivision 19e, or Minnesota Statutes 1986,
163.1section 290.09, subdivision 7, paragraph (c), not previously deducted is a depreciation
163.2allowance in the first taxable year after December 31, 2000.
163.3(2) (1) The portion of the depreciation deduction allowed for federal income tax
163.4purposes under section 168(k) of the Internal Revenue Code that is required as an
163.5addition under section 290.01, subdivision 19c, clause (12), is disallowed in determining
163.6alternative minimum taxable income.
163.7(3) (2) The subtraction for depreciation allowed under section 290.01, subdivision
163.819d
, clause (15) (14), is allowed as a depreciation deduction in determining alternative
163.9minimum taxable income.
163.10(4) (3) The alternative tax net operating loss deduction under sections 56(a)(4) and
163.1156(d) of the Internal Revenue Code does not apply.
163.12(5) (4) The special rule for certain dividends under section 56(g)(4)(C)(ii) of the
163.13Internal Revenue Code does not apply.
163.14(6) (5) The tax preference for depletion under section 57(a)(1) of the Internal
163.15Revenue Code does not apply.
163.16(7) The tax preference for intangible drilling costs under section 57(a)(2) of the
163.17Internal Revenue Code must be calculated without regard to subparagraph (E) and the
163.18subtraction under section 290.01, subdivision 19d, clause (4).
163.19(8) (6) The tax preference for tax exempt interest under section 57(a)(5) of the
163.20Internal Revenue Code does not apply.
163.21(9) (7) The tax preference for charitable contributions of appreciated property under
163.22section 57(a)(6) of the Internal Revenue Code does not apply.
163.23(10) For purposes of calculating the tax preference for accelerated depreciation or
163.24amortization on certain property placed in service before January 1, 1987, under section
163.2557(a)(7) of the Internal Revenue Code, the deduction allowable for the taxable year is the
163.26deduction allowed under section 290.01, subdivision 19e.
163.27For taxable years beginning after December 31, 2000, the amount of any remaining
163.28modification made under section 290.01, subdivision 19e, not previously deducted is a
163.29depreciation or amortization allowance in the first taxable year after December 31, 2004.
163.30(11) (8) For purposes of calculating the adjustment for adjusted current earnings
163.31in section 56(g) of the Internal Revenue Code, the term "alternative minimum taxable
163.32income" as it is used in section 56(g) of the Internal Revenue Code, means alternative
163.33minimum taxable income as defined in this subdivision, determined without regard to the
163.34adjustment for adjusted current earnings in section 56(g) of the Internal Revenue Code.
163.35(12) (9) For purposes of determining the amount of adjusted current earnings under
163.36section 56(g)(3) of the Internal Revenue Code, no adjustment shall be made under section
164.156(g)(4) of the Internal Revenue Code with respect to (i) the amount of foreign dividend
164.2gross-up subtracted as provided in section 290.01, subdivision 19d, clause (1), or (ii) the
164.3amount of refunds of income, excise, or franchise taxes subtracted as provided in section
164.4290.01, subdivision 19d , clause (9).
164.5(13) (10) Alternative minimum taxable income excludes the income from operating
164.6in a job opportunity building zone as provided under section 469.317.
164.7(14) Alternative minimum taxable income excludes the income from operating in a
164.8biotechnology and health sciences industry zone as provided under section 469.337.
164.9Items of tax preference must not be reduced below zero as a result of the
164.10modifications in this subdivision.
164.11EFFECTIVE DATE.This section is effective for taxable years beginning after
164.12December 31, 2013.

164.13    Sec. 68. Minnesota Statutes 2012, section 290.0922, subdivision 3, is amended to read:
164.14    Subd. 3. Definitions. (a) "Minnesota sales or receipts" means the total sales
164.15apportioned to Minnesota pursuant to section 290.191, subdivision 5, the total receipts
164.16attributed to Minnesota pursuant to section 290.191, subdivisions 6 to 8, and/or the
164.17total sales or receipts apportioned or attributed to Minnesota pursuant to any other
164.18apportionment formula applicable to the taxpayer.
164.19(b) "Minnesota property" means total Minnesota tangible property as provided in
164.20section 290.191, subdivisions 9 to 11, any other tangible property located in Minnesota,
164.21but does not include: (1) the property of a qualified business as defined under section
164.22469.310, subdivision 11 , that is located in a job opportunity building zone designated
164.23under section 469.314 and (2) property of a qualified business located in a biotechnology
164.24and health sciences industry zone designated under section 469.334. Intangible property
164.25shall not be included in Minnesota property for purposes of this section. Taxpayers who
164.26do not utilize tangible property to apportion income shall nevertheless include Minnesota
164.27property for purposes of this section. On a return for a short taxable year, the amount of
164.28Minnesota property owned, as determined under section 290.191, shall be included in
164.29Minnesota property based on a fraction in which the numerator is the number of days in
164.30the short taxable year and the denominator is 365.
164.31(c) "Minnesota payrolls" means total Minnesota payrolls as provided in section
164.32290.191, subdivision 12 , but does not include: (1) the job opportunity building zone payroll
164.33under section 469.310, subdivision 8, of a qualified business as defined under section
164.34469.310, subdivision 11 , and (2) biotechnology and health sciences industry zone payrolls
165.1under section 469.330, subdivision 8. Taxpayers who do not utilize payrolls to apportion
165.2income shall nevertheless include Minnesota payrolls for purposes of this section.
165.3EFFECTIVE DATE.This section is effective for taxable years beginning after
165.4December 31, 2013.

165.5    Sec. 69. Minnesota Statutes 2012, section 290.095, subdivision 3, is amended to read:
165.6    Subd. 3. Carryover. (a) A net operating loss incurred in a during the taxable year:
165.7(i) beginning after December 31, 1986, shall be a net operating loss carryover to each of
165.8the 15 taxable years following the taxable year of such loss; (ii) beginning before January
165.91, 1987, shall be a net operating loss carryover to each of the five taxable years following
165.10the taxable year of such loss subject to the provisions of Minnesota Statutes 1986, section
165.11290.095; and (iii) beginning before January 1, 1987, shall be a net operating loss carryback
165.12to each of the three taxable years preceding the loss year subject to the provisions of
165.13Minnesota Statutes 1986, section 290.095.
165.14(b) The entire amount of the net operating loss for any taxable year shall be carried to
165.15the earliest of the taxable years to which such loss may be carried. The portion of such loss
165.16which shall be carried to each of the other taxable years shall be the excess, if any, of the
165.17amount of such loss over the sum of the taxable net income, adjusted by the modifications
165.18specified in subdivision 4, for each of the taxable years to which such loss may be carried.
165.19(c) Where a corporation apportions its income under the provisions of section
165.20290.191 , the net operating loss deduction incurred in any taxable year shall be allowed
165.21to the extent of the apportionment ratio of the loss year.
165.22(d) The provisions of sections 381, 382, and 384 of the Internal Revenue Code apply
165.23to carryovers in certain corporate acquisitions and special limitations on net operating loss
165.24carryovers. The limitation amount determined under section 382 shall be applied to net
165.25income, before apportionment, in each post change year to which a loss is carried.
165.26EFFECTIVE DATE.This section is effective for taxable years beginning after
165.27December 31, 2013.

165.28    Sec. 70. Minnesota Statutes 2012, section 290.9728, subdivision 2, is amended to read:
165.29    Subd. 2. Taxable income. For purposes of this section, taxable income means
165.30the lesser of:
165.31(1) the amount of the net capital gain of the S corporation for the taxable year, as
165.32determined under sections 1222 and 1374 of the Internal Revenue Code, and subject to the
166.1modifications provided in section 290.01, subdivisions 19e and subdivision 19f, in excess
166.2of $25,000 that is allocable to this state under section 290.17, 290.191, or 290.20; or
166.3(2) the amount of the S corporation's federal taxable income, subject to the
166.4provisions of section 290.01, subdivisions 19c to 19f, that is allocable to this state under
166.5section 290.17, 290.191, or 290.20.
166.6EFFECTIVE DATE.This section is effective for taxable years beginning after
166.7December 31, 2013.

166.8    Sec. 71. Minnesota Statutes 2013 Supplement, section 297A.61, subdivision 3, as
166.9amended by Laws 2014, chapter 150, article 2, section 1, is amended to read:
166.10    Subd. 3. Sale and purchase. (a) "Sale" and "purchase" include, but are not limited
166.11to, each of the transactions listed in this subdivision. In applying the provisions of this
166.12chapter, the terms "tangible personal property" and "retail sale" include the taxable
166.13services listed in paragraph (g), clause (6), items (i) to (vi) and (viii), and the provision
166.14of these taxable services, unless specifically provided otherwise. Services performed by
166.15an employee for an employer are not taxable. Services performed by a partnership or
166.16association for another partnership or association are not taxable if one of the entities owns
166.17or controls more than 80 percent of the voting power of the equity interest in the other
166.18entity. Services performed between members of an affiliated group of corporations are not
166.19taxable. For purposes of the preceding sentence, "affiliated group of corporations" means
166.20those entities that would be classified as members of an affiliated group as defined under
166.21United States Code, title 26, section 1504, disregarding the exclusions in section 1504(b).
166.22    (b) Sale and purchase include:
166.23    (1) any transfer of title or possession, or both, of tangible personal property, whether
166.24absolutely or conditionally, for a consideration in money or by exchange or barter; and
166.25    (2) the leasing of or the granting of a license to use or consume, for a consideration
166.26in money or by exchange or barter, tangible personal property, other than a manufactured
166.27home used for residential purposes for a continuous period of 30 days or more.
166.28    (c) Sale and purchase include the production, fabrication, printing, or processing of
166.29tangible personal property for a consideration for consumers who furnish either directly or
166.30indirectly the materials used in the production, fabrication, printing, or processing.
166.31    (d) Sale and purchase include the preparing for a consideration of food.
166.32Notwithstanding section 297A.67, subdivision 2, taxable food includes, but is not limited
166.33to, the following:
166.34    (1) prepared food sold by the retailer;
166.35    (2) soft drinks;
167.1    (3) candy;
167.2    (4) dietary supplements; and
167.3    (5) all food sold through vending machines.
167.4    (e) A sale and a purchase includes the furnishing for a consideration of electricity,
167.5gas, water, or steam for use or consumption within this state.
167.6    (f) A sale and a purchase includes the transfer for a consideration of prewritten
167.7computer software whether delivered electronically, by load and leave, or otherwise.
167.8    (g) A sale and a purchase includes the furnishing for a consideration of the following
167.9services:
167.10    (1) the privilege of admission to places of amusement, recreational areas, or athletic
167.11events, and the making available of amusement devices, tanning facilities, reducing
167.12salons, steam baths, Turkish baths, health clubs, and spas or athletic facilities;
167.13    (2) lodging and related services by a hotel, rooming house, resort, campground,
167.14motel, or trailer camp, including furnishing the guest of the facility with access to
167.15telecommunication services, and the granting of any similar license to use real property in
167.16a specific facility, other than the renting or leasing of it for a continuous period of 30 days
167.17or more under an enforceable written agreement that may not be terminated without prior
167.18notice and including accommodations intermediary services provided in connection with
167.19other services provided under this clause;
167.20    (3) nonresidential parking services, whether on a contractual, hourly, or other
167.21periodic basis, except for parking at a meter;
167.22    (4) the granting of membership in a club, association, or other organization if:
167.23    (i) the club, association, or other organization makes available for the use of its
167.24members sports and athletic facilities, without regard to whether a separate charge is
167.25assessed for use of the facilities; and
167.26    (ii) use of the sports and athletic facility is not made available to the general public
167.27on the same basis as it is made available to members.
167.28Granting of membership means both onetime initiation fees and periodic membership
167.29dues. Sports and athletic facilities include golf courses; tennis, racquetball, handball, and
167.30squash courts; basketball and volleyball facilities; running tracks; exercise equipment;
167.31swimming pools; and other similar athletic or sports facilities;
167.32    (5) delivery of aggregate materials by a third party, excluding delivery of aggregate
167.33material used in road construction; and delivery of concrete block by a third party if the
167.34delivery would be subject to the sales tax if provided by the seller of the concrete block.
167.35For purposes of this clause, "road construction" means construction of:
167.36    (i) public roads;
168.1    (ii) cartways; and
168.2    (iii) private roads in townships located outside of the seven-county metropolitan area
168.3up to the point of the emergency response location sign; and
168.4    (6) services as provided in this clause:
168.5    (i) laundry and dry cleaning services including cleaning, pressing, repairing, altering,
168.6and storing clothes, linen services and supply, cleaning and blocking hats, and carpet,
168.7drapery, upholstery, and industrial cleaning. Laundry and dry cleaning services do not
168.8include services provided by coin operated facilities operated by the customer;
168.9    (ii) motor vehicle washing, waxing, and cleaning services, including services
168.10provided by coin operated facilities operated by the customer, and rustproofing,
168.11undercoating, and towing of motor vehicles;
168.12    (iii) building and residential cleaning, maintenance, and disinfecting services and
168.13pest control and exterminating services;
168.14    (iv) detective, security, burglar, fire alarm, and armored car services; but not
168.15including services performed within the jurisdiction they serve by off-duty licensed peace
168.16officers as defined in section 626.84, subdivision 1, or services provided by a nonprofit
168.17organization or any organization at the direction of a county for monitoring and electronic
168.18surveillance of persons placed on in-home detention pursuant to court order or under the
168.19direction of the Minnesota Department of Corrections;
168.20    (v) pet grooming services;
168.21    (vi) lawn care, fertilizing, mowing, spraying and sprigging services; garden planting
168.22and maintenance; tree, bush, and shrub pruning, bracing, spraying, and surgery; indoor
168.23plant care; tree, bush, shrub, and stump removal, except when performed as part of a land
168.24clearing contract as defined in section 297A.68, subdivision 40; and tree trimming for
168.25public utility lines. Services performed under a construction contract for the installation of
168.26shrubbery, plants, sod, trees, bushes, and similar items are not taxable;
168.27    (vii) massages, except when provided by a licensed health care facility or
168.28professional or upon written referral from a licensed health care facility or professional for
168.29treatment of illness, injury, or disease; and
168.30    (viii) the furnishing of lodging, board, and care services for animals in kennels and
168.31other similar arrangements, but excluding veterinary and horse boarding services.
168.32    (h) A sale and a purchase includes the furnishing for a consideration of tangible
168.33personal property or taxable services by the United States or any of its agencies or
168.34instrumentalities, or the state of Minnesota, its agencies, instrumentalities, or political
168.35subdivisions.
169.1    (i) A sale and a purchase includes the furnishing for a consideration of
169.2telecommunications services, ancillary services associated with telecommunication
169.3services, and pay television services. Telecommunication services include, but are
169.4not limited to, the following services, as defined in section 297A.669: air-to-ground
169.5radiotelephone service, mobile telecommunication service, postpaid calling service,
169.6prepaid calling service, prepaid wireless calling service, and private communication
169.7services. The services in this paragraph are taxed to the extent allowed under federal law.
169.8    (j) A sale and a purchase includes the furnishing for a consideration of installation if
169.9the installation charges would be subject to the sales tax if the installation were provided
169.10by the seller of the item being installed.
169.11    (k) A sale and a purchase includes the rental of a vehicle by a motor vehicle dealer
169.12to a customer when (1) the vehicle is rented by the customer for a consideration, or (2)
169.13the motor vehicle dealer is reimbursed pursuant to a service contract as defined in section
169.1459B.02, subdivision 11.
169.15    (l) A sale and a purchase includes furnishing for a consideration of specified digital
169.16products or other digital products or granting the right for a consideration to use specified
169.17digital products or other digital products on a temporary or permanent basis and regardless
169.18of whether the purchaser is required to make continued payments for such right. Wherever
169.19the term "tangible personal property" is used in this chapter, other than in subdivisions 10
169.20and 38, the provisions also apply to specified digital products, or other digital products,
169.21unless specifically provided otherwise or the context indicates otherwise.
169.22EFFECTIVE DATE.This section is effective the day following final enactment.

169.23    Sec. 72. Minnesota Statutes 2012, section 297A.70, subdivision 10, is amended to read:
169.24    Subd. 10. Nonprofit tickets or admissions. (a) Tickets or admissions to an event
169.25are exempt if all the gross receipts are recorded as such, in accordance with generally
169.26accepted accounting principles, on the books of one or more organizations whose primary
169.27mission is to provide an opportunity for citizens of the state to participate in the creation,
169.28performance, or appreciation of the arts, and provided that each organization is:
169.29(1) an organization described in section 501(c)(3) of the Internal Revenue Code
169.30in which voluntary contributions make up at least the following five percent of the
169.31organization's annual revenue in its most recently completed 12-month fiscal year, or in
169.32the current year if the organization has not completed a 12-month fiscal year:;
169.33(i) for sales made after July 31, 2001, and before July 1, 2002, for the organization's
169.34fiscal year completed in calendar year 2000, three percent;
170.1(ii) for sales made on or after July 1, 2002, and on or before June 30, 2003, for the
170.2organization's fiscal year completed in calendar year 2001, three percent;
170.3(iii) for sales made on or after July 1, 2003, and on or before June 30, 2004, for the
170.4organization's fiscal year completed in calendar year 2002, four percent; and
170.5(iv) for sales made in each 12-month period, beginning on July 1, 2004, and each
170.6subsequent year, for the organization's fiscal year completed in the preceding calendar
170.7year, five percent;
170.8(2) a municipal board that promotes cultural and arts activities; or
170.9(3) the University of Minnesota, a state college and university, or a private nonprofit
170.10college or university provided that the event is held at a facility owned by the educational
170.11institution holding the event.
170.12The exemption only applies if the entire proceeds, after reasonable expenses, are used
170.13solely to provide opportunities for citizens of the state to participate in the creation,
170.14performance, or appreciation of the arts.
170.15(b) Tickets or admissions to the premises of the Minnesota Zoological Garden are
170.16exempt, provided that the exemption under this paragraph does not apply to tickets or
170.17admissions to performances or events held on the premises unless the performance or
170.18event is sponsored and conducted exclusively by the Minnesota Zoological Board or
170.19employees of the Minnesota Zoological Garden.
170.20EFFECTIVE DATE.This section is effective the day following final enactment.

170.21    Sec. 73. Minnesota Statutes 2013 Supplement, section 297A.75, subdivision 1, is
170.22amended to read:
170.23    Subdivision 1. Tax collected. The tax on the gross receipts from the sale of the
170.24following exempt items must be imposed and collected as if the sale were taxable and the
170.25rate under section 297A.62, subdivision 1, applied. The exempt items include:
170.26    (1) building materials for an agricultural processing facility exempt under section
170.27297A.71, subdivision 13 ;
170.28    (2) building materials for mineral production facilities exempt under section
170.29297A.71, subdivision 14 ;
170.30    (3) building materials for correctional facilities under section 297A.71, subdivision 3;
170.31    (4) building materials used in a residence for disabled veterans exempt under section
170.32297A.71, subdivision 11 ;
170.33    (5) elevators and building materials exempt under section 297A.71, subdivision 12;
171.1    (6) building materials for the Long Lake Conservation Center exempt under section
171.2297A.71, subdivision 17;
171.3    (7) (6) materials and supplies for qualified low-income housing under section
171.4297A.71, subdivision 23 ;
171.5    (8) (7) materials, supplies, and equipment for municipal electric utility facilities
171.6under section 297A.71, subdivision 35;
171.7    (9) (8) equipment and materials used for the generation, transmission, and
171.8distribution of electrical energy and an aerial camera package exempt under section
171.9297A.68 , subdivision 37;
171.10    (10) (9) commuter rail vehicle and repair parts under section 297A.70, subdivision
171.113, paragraph (a), clause (10);
171.12    (11) (10) materials, supplies, and equipment for construction or improvement of
171.13projects and facilities under section 297A.71, subdivision 40;
171.14(12) materials, supplies, and equipment for construction or improvement of a meat
171.15processing facility exempt under section 297A.71, subdivision 41;
171.16(13) (11) materials, supplies, and equipment for construction, improvement, or
171.17expansion of:
171.18(i) an aerospace defense manufacturing facility exempt under section 297A.71,
171.19subdivision 42
;
171.20(ii) a biopharmaceutical manufacturing facility exempt under section 297A.71,
171.21subdivision 45
;
171.22(iii) a research and development facility exempt under section 297A.71, subdivision
171.2346
; and
171.24(iv) an industrial measurement manufacturing and controls facility exempt under
171.25section 297A.71, subdivision 47;
171.26(14) (12) enterprise information technology equipment and computer software for
171.27use in a qualified data center exempt under section 297A.68, subdivision 42;
171.28(15) (13) materials, supplies, and equipment for qualifying capital projects under
171.29section 297A.71, subdivision 44;
171.30(16) (14) items purchased for use in providing critical access dental services exempt
171.31under section 297A.70, subdivision 7, paragraph (c); and
171.32(17) (15) items and services purchased under a business subsidy agreement for use or
171.33consumption primarily in greater Minnesota exempt under section 297A.68, subdivision 44.
171.34EFFECTIVE DATE.This section is effective the day following final enactment.

172.1    Sec. 74. Minnesota Statutes 2013 Supplement, section 297A.75, subdivision 2, is
172.2amended to read:
172.3    Subd. 2. Refund; eligible persons. Upon application on forms prescribed by the
172.4commissioner, a refund equal to the tax paid on the gross receipts of the exempt items
172.5must be paid to the applicant. Only the following persons may apply for the refund:
172.6    (1) for subdivision 1, clauses (1), (2), and (16) (14), the applicant must be the
172.7purchaser;
172.8    (2) for subdivision 1, clauses clause (3) and (6), the applicant must be the
172.9governmental subdivision;
172.10    (3) for subdivision 1, clause (4), the applicant must be the recipient of the benefits
172.11provided in United States Code, title 38, chapter 21;
172.12    (4) for subdivision 1, clause (5), the applicant must be the owner of the homestead
172.13property;
172.14    (5) for subdivision 1, clause (7) (6), the owner of the qualified low-income housing
172.15project;
172.16    (6) for subdivision 1, clause (8) (7), the applicant must be a municipal electric utility
172.17or a joint venture of municipal electric utilities;
172.18    (7) for subdivision 1, clauses (9), (12), (13), (14) (8), (11), (12), and (17) (15),
172.19the owner of the qualifying business; and
172.20    (8) for subdivision 1, clauses (9), (10), (11), and (15) (13), the applicant must be the
172.21governmental entity that owns or contracts for the project or facility.
172.22EFFECTIVE DATE.This section is effective the day following final enactment.

172.23    Sec. 75. Minnesota Statutes 2013 Supplement, section 297A.75, subdivision 3, is
172.24amended to read:
172.25    Subd. 3. Application. (a) The application must include sufficient information
172.26to permit the commissioner to verify the tax paid. If the tax was paid by a contractor,
172.27subcontractor, or builder, under subdivision 1, clauses (3) to (15) (13), or (17) (15), the
172.28contractor, subcontractor, or builder must furnish to the refund applicant a statement
172.29including the cost of the exempt items and the taxes paid on the items unless otherwise
172.30specifically provided by this subdivision. The provisions of sections 289A.40 and
172.31289A.50 apply to refunds under this section.
172.32    (b) An applicant may not file more than two applications per calendar year for
172.33refunds for taxes paid on capital equipment exempt under section 297A.68, subdivision 5.
172.34    (c) Total refunds for purchases of items in section 297A.71, subdivision 40, must not
172.35exceed $5,000,000 in fiscal years 2010 and 2011. Applications for refunds for purchases
173.1of items in sections 297A.70, subdivision 3, paragraph (a), clause (11), and 297A.71,
173.2subdivision 40, must not be filed until after June 30, 2009.
173.3EFFECTIVE DATE.This section is effective the day following final enactment.

173.4    Sec. 76. Minnesota Statutes 2012, section 297A.94, is amended to read:
173.5297A.94 DEPOSIT OF REVENUES.
173.6(a) Except as provided in this section, the commissioner shall deposit the revenues,
173.7including interest and penalties, derived from the taxes imposed by this chapter in the state
173.8treasury and credit them to the general fund.
173.9(b) The commissioner shall deposit taxes in the Minnesota agricultural and economic
173.10account in the special revenue fund if:
173.11(1) the taxes are derived from sales and use of property and services purchased for
173.12the construction and operation of an agricultural resource project; and
173.13(2) the purchase was made on or after the date on which a conditional commitment
173.14was made for a loan guaranty for the project under section 41A.04, subdivision 3.
173.15The commissioner of management and budget shall certify to the commissioner the date
173.16on which the project received the conditional commitment. The amount deposited in
173.17the loan guaranty account must be reduced by any refunds and by the costs incurred by
173.18the Department of Revenue to administer and enforce the assessment and collection of
173.19the taxes.
173.20(c) The commissioner shall deposit the revenues, including interest and penalties,
173.21derived from the taxes imposed on sales and purchases included in section 297A.61,
173.22subdivision 3
, paragraph (g), clauses (1) and (4), in the state treasury, and credit them
173.23as follows:
173.24(1) first to the general obligation special tax bond debt service account in each fiscal
173.25year the amount required by section 16A.661, subdivision 3, paragraph (b); and
173.26(2) after the requirements of clause (1) have been met, the balance to the general fund.
173.27(d) The commissioner shall deposit the revenues, including interest and penalties,
173.28collected under section 297A.64, subdivision 5, in the state treasury and credit them to the
173.29general fund. By July 15 of each year the commissioner shall transfer to the highway user
173.30tax distribution fund an amount equal to the excess fees collected under section 297A.64,
173.31subdivision 5
, for the previous calendar year.
173.32(e) For fiscal year 2001, 97 percent; for fiscal years 2002 and 2003, 87 percent; and
173.33For fiscal year 2004 and thereafter, 72.43 percent of the revenues, including interest and
174.1penalties, transmitted to the commissioner under section 297A.65, must be deposited by
174.2the commissioner in the state treasury as follows:
174.3(1) 50 percent of the receipts must be deposited in the heritage enhancement account
174.4in the game and fish fund, and may be spent only on activities that improve, enhance, or
174.5protect fish and wildlife resources, including conservation, restoration, and enhancement
174.6of land, water, and other natural resources of the state;
174.7(2) 22.5 percent of the receipts must be deposited in the natural resources fund, and
174.8may be spent only for state parks and trails;
174.9(3) 22.5 percent of the receipts must be deposited in the natural resources fund, and
174.10may be spent only on metropolitan park and trail grants;
174.11(4) three percent of the receipts must be deposited in the natural resources fund, and
174.12may be spent only on local trail grants; and
174.13(5) two percent of the receipts must be deposited in the natural resources fund,
174.14and may be spent only for the Minnesota Zoological Garden, the Como Park Zoo and
174.15Conservatory, and the Duluth Zoo.
174.16(f) The revenue dedicated under paragraph (e) may not be used as a substitute
174.17for traditional sources of funding for the purposes specified, but the dedicated revenue
174.18shall supplement traditional sources of funding for those purposes. Land acquired with
174.19money deposited in the game and fish fund under paragraph (e) must be open to public
174.20hunting and fishing during the open season, except that in aquatic management areas or
174.21on lands where angling easements have been acquired, fishing may be prohibited during
174.22certain times of the year and hunting may be prohibited. At least 87 percent of the money
174.23deposited in the game and fish fund for improvement, enhancement, or protection of fish
174.24and wildlife resources under paragraph (e) must be allocated for field operations.
174.25(g) The revenues deposited under paragraphs (a) to (f) do not include the revenues,
174.26including interest and penalties, generated by the sales tax imposed under section
174.27297A.62, subdivision 1a , which must be deposited as provided under the Minnesota
174.28Constitution, article XI, section 15.
174.29EFFECTIVE DATE.This section is effective the day following final enactment.

174.30    Sec. 77. Minnesota Statutes 2012, section 297B.09, is amended to read:
174.31297B.09 ALLOCATION OF REVENUE.
174.32    Subdivision 1. Deposit of revenues. (a) Money collected and received under this
174.33chapter must be deposited as provided in this subdivision.
175.1    (b) From July 1, 2007, through June 30, 2008, 38.25 percent of the money collected
175.2and received must be deposited in the highway user tax distribution fund, 24 percent must
175.3be deposited in the metropolitan area transit account under section 16A.88, and 1.5 percent
175.4must be deposited in the greater Minnesota transit account under section 16A.88. The
175.5remaining money must be deposited in the general fund.
175.6    (c) From July 1, 2008, through June 30, 2009, 44.25 percent of the money collected
175.7and received must be deposited in the highway user tax distribution fund, 27.75 percent
175.8must be deposited in the metropolitan area transit account under section 16A.88, 1.75
175.9percent must be deposited in the greater Minnesota transit account under section 16A.88,
175.10and the remaining money must be deposited in the general fund.
175.11(d) From July 1, 2009, through June 30, 2010, 47.5 percent of the money collected
175.12and received must be deposited in the highway user tax distribution fund, 30 percent
175.13must be deposited in the metropolitan area transit account under section 16A.88, 3.5
175.14percent must be deposited in the greater Minnesota transit account under section 16A.88,
175.15and 16.25 percent must be deposited in the general fund. The remaining amount must
175.16be deposited as follows:
175.17(1) 1.5 percent in the metropolitan area transit account, except that any amount in
175.18excess of $6,000,000 must be deposited in the highway user tax distribution fund; and
175.19(2) 1.25 percent in the greater Minnesota transit account, except that any amount in
175.20excess of $5,000,000 must be deposited in the highway user tax distribution fund.
175.21(e) From July 1, 2010, through June 30, 2011, 54.5 percent of the money collected
175.22and received must be deposited in the highway user tax distribution fund, 33.75 percent
175.23must be deposited in the metropolitan area transit account under section 16A.88, 3.75
175.24
percent must be deposited in the greater Minnesota transit account under section 16A.88,
175.25and 6.25 percent must be deposited in the general fund. The remaining amount must
175.26be deposited as follows:
175.27(1) 1.5 percent in the metropolitan area transit account, except that any amount in
175.28excess of $6,750,000 must be deposited in the highway user tax distribution fund; and
175.29(2) 0.25 percent in the greater Minnesota transit account, except that any amount in
175.30excess of $1,250,000 must be deposited in the highway user tax distribution fund.
175.31    (f) On and after July 1, 2011, (b) 60 percent of the money collected and received
175.32must be deposited in the highway user tax distribution fund, 36 percent must be deposited
175.33in the metropolitan area transit account under section 16A.88, and four percent must be
175.34deposited in the greater Minnesota transit account under section 16A.88.
175.35(g) (c) It is the intent of the legislature that the allocations under paragraph (f) (b)
175.36 remain unchanged for fiscal year 2012 and all subsequent fiscal years.
176.1EFFECTIVE DATE.This section is effective the day following final enactment.

176.2    Sec. 78. Minnesota Statutes 2012, section 297F.03, subdivision 2, is amended to read:
176.3    Subd. 2. Form of application. Every application for a cigarette or tobacco products
176.4license shall be made on a form prescribed by the commissioner and shall state the name
176.5and address of the applicant; if the applicant is a firm, partnership, or association, the name
176.6and address of each of its members; if the applicant is a corporation, the name and address
176.7of each of its officers; the address of its principal place of business; the place where the
176.8business to be licensed is to be conducted; and any other information the commissioner
176.9may require for the administration of this chapter.
176.10EFFECTIVE DATE.This section is effective the day following final enactment.

176.11    Sec. 79. Minnesota Statutes 2012, section 297H.06, subdivision 2, is amended to read:
176.12    Subd. 2. Materials. The tax is not imposed upon charges to generators of mixed
176.13municipal solid waste or upon the volume of nonmixed municipal solid waste for waste
176.14management services to manage the following materials:
176.15(1) mixed municipal solid waste and nonmixed municipal solid waste generated
176.16outside of Minnesota;
176.17(2) recyclable materials that are separated for recycling by the generator, collected
176.18separately from other waste, and recycled, to the extent the price of the service for
176.19handling recyclable material is separately itemized;
176.20(3) recyclable nonmixed municipal solid waste that is separated for recycling by
176.21the generator, collected separately from other waste, delivered to a waste facility for the
176.22purpose of recycling, and recycled;
176.23(4) industrial waste, when it is transported to a facility owned and operated by
176.24the same person that generated it;
176.25(5) mixed municipal solid waste from a recycling facility that separates or processes
176.26recyclable materials and reduces the volume of the waste by at least 85 percent, provided
176.27that the exempted waste is managed separately from other waste;
176.28(6) recyclable materials that are separated from mixed municipal solid waste by the
176.29generator, collected and delivered to a waste facility that recycles at least 85 percent of its
176.30waste, and are collected with mixed municipal solid waste that is segregated in leakproof
176.31bags, provided that the mixed municipal solid waste does not exceed five percent of the
176.32total weight of the materials delivered to the facility and is ultimately delivered to a waste
176.33facility identified as a preferred waste management facility in county solid waste plans
176.34under section 115A.46;
177.1(7) source-separated compostable waste, if the waste is delivered to a facility
177.2exempted as described in this clause. To initially qualify for an exemption, a facility must
177.3apply for an exemption in its application for a new or amended solid waste permit to the
177.4Pollution Control Agency. The first time a facility applies to the agency it must certify in
177.5its application that it will comply with the criteria in items (i) to (v) and the commissioner
177.6of the agency shall so certify to the commissioner of revenue who must grant the
177.7exemption. For each subsequent calendar year, by October 1 of the preceding year, The
177.8facility must annually apply to the agency for certification to renew its exemption for the
177.9following year. The application must be filed according to the procedures of, and contain
177.10the information required by, the agency. The commissioner of revenue shall grant the
177.11exemption if the commissioner of the Pollution Control Agency finds and certifies to the
177.12commissioner of revenue that based on an evaluation of the composition of incoming
177.13waste and residuals and the quality and use of the product:
177.14(i) generators separate materials at the source;
177.15(ii) the separation is performed in a manner appropriate to the technology specific
177.16to the facility that:
177.17(A) maximizes the quality of the product;
177.18(B) minimizes the toxicity and quantity of residuals; and
177.19(C) provides an opportunity for significant improvement in the environmental
177.20efficiency of the operation;
177.21(iii) the operator of the facility educates generators, in coordination with each county
177.22using the facility, about separating the waste to maximize the quality of the waste stream
177.23for technology specific to the facility;
177.24(iv) process residuals do not exceed 15 percent of the weight of the total material
177.25delivered to the facility; and
177.26(v) the final product is accepted for use;
177.27(8) waste and waste by-products for which the tax has been paid; and
177.28(9) daily cover for landfills that has been approved in writing by the Minnesota
177.29Pollution Control Agency.

177.30    Sec. 80. Minnesota Statutes 2012, section 297I.05, subdivision 14, is amended to read:
177.31    Subd. 14. Life insurance. A tax is imposed on life insurance. The rate of tax equals
177.32a percentage 1.5 percent of gross premiums less return premiums on all direct business
177.33received by the insurer or agents of the insurer in Minnesota for life insurance, in cash or
177.34otherwise, during the year. For premiums received after December 31, 2005, but before
177.35January 1, 2007, the rate of tax is 1.875 percent. For premiums received after December
178.131, 2006, but before January 1, 2008, the rate of tax is 1.75 percent. For premiums
178.2received after December 31, 2007, but before January 1, 2009, the rate of tax is 1.625
178.3percent. For premiums received after December 31, 2008, the rate of tax is 1.5 percent.
178.4EFFECTIVE DATE.This section is effective the day following final enactment.

178.5    Sec. 81. Minnesota Statutes 2012, section 298.75, subdivision 1, is amended to read:
178.6    Subdivision 1. Definitions. Except as may otherwise be provided, the following
178.7words, when used in this section, shall have the meanings herein ascribed to them.
178.8    (a) "Aggregate material" means:
178.9    (1) nonmetallic natural mineral aggregate including, but not limited to sand, silica
178.10sand, gravel, crushed rock, limestone, granite, and borrow, but only if the borrow is
178.11transported on a public road, street, or highway, provided that nonmetallic aggregate
178.12material does not include dimension stone and dimension granite; and
178.13    (2) taconite tailings, crushed rock, and architectural or dimension stone and dimension
178.14granite removed from a taconite mine or the site of a previously operated taconite mine.
178.15    Aggregate material must be measured or weighed after it has been extracted from
178.16the pit, quarry, or deposit.
178.17    (b) "Person" means any individual, firm, partnership, corporation, organization,
178.18trustee, association, or other entity.
178.19    (c) "Operator" means any person engaged in the business of removing aggregate
178.20material from the surface or subsurface of the soil, for the purpose of sale, either directly
178.21or indirectly, through the use of the aggregate material in a marketable product or service.
178.22    (d) "Extraction site" means a pit, quarry, or deposit containing aggregate material
178.23and any contiguous property to the pit, quarry, or deposit which is used by the operator for
178.24stockpiling the aggregate material.
178.25    (e) "Importer" means any person who buys aggregate material excavated from a
178.26county not listed in paragraph (f) or another state site on which the tax under this section is
178.27not imposed and causes the aggregate material to be imported into a county in this state
178.28which imposes a tax on aggregate material.
178.29    (f) "County" means the counties of Pope, Stearns, Benton, Sherburne, Carver, Scott,
178.30Dakota, Le Sueur, Kittson, Marshall, Pennington, Red Lake, Polk, Norman, Mahnomen,
178.31Clay, Becker, Carlton, St. Louis, Rock, Murray, Wilkin, Big Stone, Sibley, Hennepin,
178.32Washington, Chisago, and Ramsey. County also means a county imposing the tax under
178.33this section on December 31, 2014, or any other county whose board has voted after a
178.34public hearing to impose the tax under this section and has notified the commissioner of
178.35revenue of the imposition of the tax.
179.1    (g) "Borrow" means granular borrow, consisting of durable particles of gravel and
179.2sand, crushed quarry or mine rock, crushed gravel or stone, or any combination thereof,
179.3the ratio of the portion passing the (#200) sieve divided by the portion passing the (1 inch)
179.4sieve may not exceed 20 percent by mass.
179.5EFFECTIVE DATE.This section is effective January 1, 2015.

179.6    Sec. 82. Minnesota Statutes 2012, section 412.131, is amended to read:
179.7412.131 ASSESSOR; DUTIES, COMPENSATION.
179.8The city assessor, if there is one, shall assess and return as provided by law all
179.9property taxable within the city, if a separate assessment district, and the assessor of the
179.10town within which the city lies shall not include in the return any property taxable in the
179.11city. Any assessor may appoint a deputy assessor as provided in section 273.06. The
179.12assessor may be compensated on a full-time or part-time basis at the option of the council
179.13but the compensation shall be not less than $100 in any one year, if fixed on an annual
179.14basis, or not more than $20 per day, if fixed on a per diem basis. If the compensation is
179.15not fixed by the council the assessor shall be entitled to compensation at the rate of $20
179.16per day for each days service necessarily rendered, and mileage at the rate paid other city
179.17officers for each mile necessarily traveled in going to and returning from the county seat of
179.18the county to attend any meeting of the assessors of the county legally called by the county
179.19auditor, and also for each mile necessarily traveled in making the return of assessment
179.20to the proper county officer and in attending sectional meetings called by the county
179.21assessor, except when mileage is paid by the county. In addition to other compensation,
179.22the council may allow the assessor mileage at the same rate per mile as paid other city
179.23officers for each mile necessarily traveled in assessment work.
179.24EFFECTIVE DATE.This section is effective the day following final enactment.

179.25    Sec. 83. Minnesota Statutes 2013 Supplement, section 423A.022, subdivision 3,
179.26is amended to read:
179.27    Subd. 3. Reporting; definitions. (a) On or before September 1, annually, the
179.28executive director of the Public Employees Retirement Association shall report to the
179.29commissioner of revenue the following:
179.30    (1) the municipalities which employ firefighters with retirement coverage by the
179.31public employees police and fire retirement plan;
179.32    (2) the number of firefighters with public employees police and fire retirement plan
179.33coverage employed by each municipality;
180.1    (3) (2) the fire departments covered by the voluntary statewide lump-sum volunteer
180.2firefighter retirement plan; and
180.3    (4) (3) any other information requested by the commissioner to administer the police
180.4and firefighter retirement supplemental state aid program.
180.5    (b) For this subdivision, (i) the number of firefighters employed by a municipality
180.6who have public employees police and fire retirement plan coverage means the number
180.7of firefighters with public employees police and fire retirement plan coverage that were
180.8employed by the municipality for not less than 30 hours per week for a minimum of six
180.9months prior to December 31 preceding the date of the payment under this section and, if
180.10the person was employed for less than the full year, prorated to the number of full months
180.11employed; and (ii) the number of active police officers certified for police state aid receipt
180.12under section 69.011, subdivisions 2 and 2b, means, for each municipality, the number of
180.13police officers meeting the definition of peace officer in section 69.011, subdivision 1,
180.14counted as provided and limited by section 69.011, subdivisions 2 and 2b.
180.15EFFECTIVE DATE.This section is effective the day following final enactment.

180.16    Sec. 84. Minnesota Statutes 2013 Supplement, section 465.04, is amended to read:
180.17465.04 ACCEPTANCE OF GIFTS.
180.18    Cities A city of the second, third, or fourth class, having at any time an estimated
180.19market value of not more than $41,000,000, as officially equalized by the commissioner
180.20of revenue, either operating under a home rule charter or under the laws of this state, in
180.21addition to all other powers possessed by them, hereby are authorized and empowered to
180.22 may receive and accept gifts and donations for the use and benefit of such cities and the
180.23city and its inhabitants thereof upon terms and conditions to be approved by the governing
180.24bodies body of such cities; and such cities are authorized to comply with and perform such
180.25 the city. The terms and conditions, which may include payment to the donor or donors of
180.26interest on the value of the gift at not exceeding five percent per annum payable annually or
180.27semiannually, during the remainder of the natural life or lives of such the donor or donors.

180.28    Sec. 85. Minnesota Statutes 2012, section 469.176, subdivision 1b, is amended to read:
180.29    Subd. 1b. Duration limits; terms. (a) No tax increment shall in any event be
180.30paid to the authority:
180.31(1) after 15 years after receipt by the authority of the first increment for a renewal
180.32and renovation district;
181.1(2) after 20 years after receipt by the authority of the first increment for a soils
181.2condition district;
181.3(3) after eight years after receipt by the authority of the first increment for an
181.4economic development district;
181.5(4) for a housing district, a compact development district, or a redevelopment
181.6district, after 25 years from the date of receipt by the authority of the first increment.
181.7(b) For purposes of determining a duration limit under this subdivision or subdivision
181.81e that is based on the receipt of an increment, any increments from taxes payable in the year
181.9in which the district terminates shall be paid to the authority. This paragraph does not affect
181.10a duration limit calculated from the date of approval of the tax increment financing plan or
181.11based on the recovery of costs or to a duration limit under subdivision 1c. This paragraph
181.12does not supersede the restrictions on payment of delinquent taxes in subdivision 1f.
181.13(c) An action by the authority to waive or decline to accept an increment has no
181.14effect for purposes of computing a duration limit based on the receipt of increment under
181.15this subdivision or any other provision of law. The authority is deemed to have received an
181.16increment for any year in which it waived or declined to accept an increment, regardless
181.17of whether the increment was paid to the authority.
181.18(d) Receipt by a hazardous substance subdistrict of an increment as a result of a
181.19reduction in original net tax capacity under section 469.174, subdivision 7, paragraph
181.20(b), does not constitute receipt of increment by the overlying district for the purpose of
181.21calculating the duration limit under this section.
181.22EFFECTIVE DATE.This section is effective the day following final enactment.

181.23    Sec. 86. Minnesota Statutes 2012, section 469.176, subdivision 3, is amended to read:
181.24    Subd. 3. Limitation on administrative expenses. (a) For districts for which
181.25certification was requested before August 1, 1979, or after June 30, 1982 and before
181.26 August 1, 2001, no tax increment shall be used to pay any administrative expenses for
181.27a project which exceed ten percent of the total estimated tax increment expenditures
181.28authorized by the tax increment financing plan or the total tax increment expenditures
181.29for the project, whichever is less.
181.30(b) For districts for which certification was requested after July 31, 1979, and before
181.31July 1, 1982, no tax increment shall be used to pay administrative expenses, as defined in
181.32Minnesota Statutes 1980, section 273.73, for a district which exceeds five percent of the
181.33total tax increment expenditures authorized by the tax increment financing plan or the total
181.34estimated tax increment expenditures for the district, whichever is less.
182.1(c) (b) For districts for which certification was requested after July 31, 2001, no tax
182.2increment may be used to pay any administrative expenses for a project which exceed
182.3ten percent of total estimated tax increment expenditures authorized by the tax increment
182.4financing plan or the total tax increments, as defined in section 469.174, subdivision 25,
182.5clause (1), from the district, whichever is less.
182.6(d) (c) Increments used to pay the county's administrative expenses under
182.7subdivision 4h are not subject to the percentage limits in this subdivision.
182.8EFFECTIVE DATE.This section is effective the day following final enactment.

182.9    Sec. 87. Minnesota Statutes 2013 Supplement, section 469.1763, subdivision 2,
182.10is amended to read:
182.11    Subd. 2. Expenditures outside district. (a) For each tax increment financing
182.12district, an amount equal to at least 75 percent of the total revenue derived from tax
182.13increments paid by properties in the district must be expended on activities in the district
182.14or to pay bonds, to the extent that the proceeds of the bonds were used to finance activities
182.15in the district or to pay, or secure payment of, debt service on credit enhanced bonds.
182.16For districts, other than redevelopment districts for which the request for certification
182.17was made after June 30, 1995, the in-district percentage for purposes of the preceding
182.18sentence is 80 percent. Not more than 25 percent of the total revenue derived from tax
182.19increments paid by properties in the district may be expended, through a development fund
182.20or otherwise, on activities outside of the district but within the defined geographic area of
182.21the project except to pay, or secure payment of, debt service on credit enhanced bonds.
182.22For districts, other than redevelopment districts for which the request for certification was
182.23made after June 30, 1995, the pooling percentage for purposes of the preceding sentence is
182.2420 percent. The revenue derived from tax increments for the district that are expended on
182.25costs under section 469.176, subdivision 4h, paragraph (b), may be deducted first before
182.26calculating the percentages that must be expended within and without the district.
182.27    (b) In the case of a housing district, a housing project, as defined in section 469.174,
182.28subdivision 11
, is an activity in the district.
182.29    (c) All administrative expenses are for activities outside of the district, except that
182.30if the only expenses for activities outside of the district under this subdivision are for
182.31the purposes described in paragraph (d), administrative expenses will be considered as
182.32expenditures for activities in the district.
182.33    (d) The authority may elect, in the tax increment financing plan for the district,
182.34to increase by up to ten percentage points the permitted amount of expenditures for
182.35activities located outside the geographic area of the district under paragraph (a). As
183.1permitted by section 469.176, subdivision 4k, the expenditures, including the permitted
183.2expenditures under paragraph (a), need not be made within the geographic area of the
183.3project. Expenditures that meet the requirements of this paragraph are legally permitted
183.4expenditures of the district, notwithstanding section 469.176, subdivisions 4b, 4c, and 4j.
183.5To qualify for the increase under this paragraph, the expenditures must:
183.6    (1) be used exclusively to assist housing that meets the requirement for a qualified
183.7low-income building, as that term is used in section 42 of the Internal Revenue Code; and
183.8    (2) not exceed the qualified basis of the housing, as defined under section 42(c) of
183.9the Internal Revenue Code, less the amount of any credit allowed under section 42 of
183.10the Internal Revenue Code; and
183.11    (3) be used to:
183.12    (i) acquire and prepare the site of the housing;
183.13    (ii) acquire, construct, or rehabilitate the housing; or
183.14    (iii) make public improvements directly related to the housing; or
183.15(4) be used to develop housing:
183.16(i) if the market value of the housing does not exceed the lesser of:
183.17(A) 150 percent of the average market value of single-family homes in that
183.18municipality; or
183.19(B) $200,000 for municipalities located in the metropolitan area, as defined in
183.20section 473.121, or $125,000 for all other municipalities; and
183.21(ii) if the expenditures are used to pay the cost of site acquisition, relocation,
183.22demolition of existing structures, site preparation, and pollution abatement on one or
183.23more parcels, if the parcel contains a residence containing one to four family dwelling
183.24units that has been vacant for six or more months and is in foreclosure as defined in
183.25section 325N.10, subdivision 7, but without regard to whether the residence is the owner's
183.26principal residence, and only after the redemption period has expired.
183.27    (e) For a district created within a biotechnology and health sciences industry zone
183.28as defined in section 469.330, subdivision 6, or for an existing district located within
183.29such a zone, tax increment derived from such a district may be expended outside of the
183.30district but within the zone only for expenditures required for the construction of public
183.31infrastructure necessary to support the activities of the zone, land acquisition, and other
183.32redevelopment costs as defined in section 469.176, subdivision 4j. These expenditures are
183.33considered as expenditures for activities within the district. The authority provided by
183.34this paragraph expires for expenditures made after the later of (1) December 31, 2015,
183.35or (2) the end of the five-year period beginning on the date the district was certified,
183.36provided that date was before January 1, 2016.
184.1(f) The authority under paragraph (d), clause (4), expires on December 31, 2016.
184.2Increments may continue to be expended under this authority after that date, if they are
184.3used to pay bonds or binding contracts that would qualify under subdivision 3, paragraph
184.4(a), if December 31, 2016, is considered to be the last date of the five-year period after
184.5certification under that provision.
184.6EFFECTIVE DATE.This section is effective the day following final enactment
184.7and applies to all districts, regardless of when the request for certification was made.

184.8    Sec. 88. Minnesota Statutes 2012, section 473.665, subdivision 5, is amended to read:
184.9    Subd. 5. Tax levy; surplus; reduction. The corporation, upon issuing any bonds
184.10under the provisions of this section, shall, before the issuance thereof, levy for each year,
184.11until the principal and interest are paid in full, a direct annual tax on all the taxable property
184.12of the cities in and for which the corporation has been created in an amount not less than
184.13five percent in excess of the sum required to pay the principal and interest thereof, when
184.14and as such principal and interest matures. After any of such bonds have been delivered to
184.15purchasers, such tax shall be irrepealable until all such indebtedness is paid, and after the
184.16issuance of such bonds no further action of the corporation shall be necessary to authorize
184.17the extensions, assessments, and collection of such tax. The secretary of the corporation
184.18shall forthwith furnish a certified copy of such levy to the county auditor or county
184.19auditors of the county or counties in which the cities in and for which the corporation has
184.20been created are located, together with full information regarding the bonds for which the
184.21tax is levied, and such county auditor or such county auditors, as the case may be, shall
184.22enter the same in the register provided for in section 475.62, or a similar register, and shall
184.23extend and assess the tax so levied. If both cities are located wholly within one county, the
184.24county auditor thereof shall annually extend and assess the amount of the tax so levied. If
184.25the cities are located in different counties, the county auditor of each such county shall
184.26annually extend and assess such portion of the tax levied as the net tax capacity of the
184.27taxable property, not including moneys and credits, located wholly within the city in such
184.28county bears to the total net tax capacity of the taxable property, not including moneys and
184.29credits, within both cities. Any surplus resulting from the excess levy herein provided
184.30for shall be transferred to a sinking fund after the principal and interest for which the tax
184.31was levied and collected has been paid; provided, that the corporation may, on or before
184.32October 15 in any year, by appropriate action, cause its secretary to certify to the county
184.33auditor, or auditors, the amount on hand and available in its treasury from earnings, or
184.34otherwise, including the amount in the sinking fund, which it will use to pay principal or
184.35interest or both on each specified issue of its bonds, and the county auditor or auditors
185.1shall reduce the levy for that year, herein provided for by that amount. The amount of
185.2funds so certified shall be set aside by the corporation, and be used for no other purpose
185.3than for the payment of the principal and interest of the bonds. All taxes hereunder shall
185.4be collected and remitted to the corporation by the county treasurer or county treasurers,
185.5in accordance with the provisions of law governing the collection of other taxes, and shall
185.6be used solely for the payment of the bonds where due.
185.7EFFECTIVE DATE.This section is effective the day following final enactment.

185.8    Sec. 89. Minnesota Statutes 2012, section 477A.0124, subdivision 5, is amended to
185.9read:
185.10    Subd. 5. County transition aid. (a) For 2009 and each year thereafter, A county is
185.11eligible to receive the transition aid it received in 2007.
185.12    (b) In 2009 only, a county with (1) a 2006 population less than 30,000, and (2)
185.13an average Part I crimes per capita greater than 3.9 percent based on factors used in
185.14determining county program aid payable in 2008, shall receive $100,000.
185.15EFFECTIVE DATE.This section is effective the day following final enactment.

185.16    Sec. 90. Minnesota Statutes 2012, section 477A.014, subdivision 1, is amended to read:
185.17    Subdivision 1. Calculations and payments. (a) The commissioner of revenue shall
185.18make all necessary calculations and make payments pursuant to sections 477A.013 and
185.19477A.03 directly to the affected taxing authorities annually. In addition, the commissioner
185.20shall notify the authorities of their aid amounts, as well as the computational factors used
185.21in making the calculations for their authority, and those statewide total figures that are
185.22pertinent, before August 1 of the year preceding the aid distribution year.
185.23(b) For the purposes of this subdivision, aid is determined for a city or town based
185.24on its city or town status as of June 30 of the year preceding the aid distribution year. If
185.25the effective date for a municipal incorporation, consolidation, annexation, detachment,
185.26dissolution, or township organization is on or before June 30 of the year preceding
185.27the aid distribution year, such change in boundaries or form of government shall be
185.28recognized for aid determinations for the aid distribution year. If the effective date for a
185.29municipal incorporation, consolidation, annexation, detachment, dissolution, or township
185.30organization is after June 30 of the year preceding the aid distribution year, such change in
185.31boundaries or form of government shall not be recognized for aid determinations until
185.32the following year.
186.1(c) Changes in boundaries or form of government will only be recognized for the
186.2purposes of this subdivision, to the extent that: (1) changes in market values are included
186.3in market values reported by assessors to the commissioner, and changes in population,
186.4 and household size, and the road accidents factor are included in their respective
186.5certifications to the commissioner as referenced in section 477A.011, or (2) an annexation
186.6information report as provided in paragraph (d) is received by the commissioner on
186.7or before July 15 of the aid calculation year. Revisions to estimates or data for use in
186.8recognizing changes in boundaries or form of government are not effective for purposes
186.9of this subdivision unless received by the commissioner on or before July 15 of the aid
186.10calculation year. Clerical errors in the certification or use of estimates and data established
186.11as of July 15 in the aid calculation year are subject to correction within the time periods
186.12allowed under subdivision 3.
186.13(d) In the case of an annexation, an annexation information report may be completed
186.14by the annexing jurisdiction and submitted to the commissioner for purposes of this
186.15subdivision if the net tax capacity of annexed area for the assessment year preceding the
186.16effective date of the annexation exceeds five percent of the city's net tax capacity for the
186.17same year. The form and contents of the annexation information report shall be prescribed
186.18by the commissioner. The commissioner shall change the net tax capacity, the population,
186.19the population decline, the commercial industrial percentage, and the transformed
186.20population for the annexing jurisdiction only if the annexation information report provides
186.21data the commissioner determines to be reliable for all of these factors used to compute city
186.22revenue need for the annexing jurisdiction. The commissioner shall adjust the pre-1940
186.23housing percentage, the road accidents factor, and household size only if the entire area of
186.24an existing city or town is annexed or consolidated and only if reliable data is available for
186.25all of these factors used to compute city revenue need for the annexing jurisdiction.
186.26EFFECTIVE DATE.This section is effective the day following final enactment.

186.27    Sec. 91. Minnesota Statutes 2012, section 611.27, subdivision 13, is amended to read:
186.28    Subd. 13. Public defense services; correctional facility inmates. All billings
186.29for services rendered and ordered under subdivision 7 shall require the approval of the
186.30chief district public defender before being forwarded on a monthly basis to the state
186.31public defender. In cases where adequate representation cannot be provided by the district
186.32public defender and where counsel has been appointed under a court order, the state
186.33public defender shall forward to the commissioner of management and budget all billings
186.34for services rendered under the court order. The commissioner shall pay for services
187.1from county program aid retained by the commissioner of revenue for that purpose under
187.2section 477A.0124, subdivision 1, clause (4), or 477A.03, subdivision 2b, paragraph (a).
187.3    The costs of appointed counsel and associated services in cases arising from new
187.4criminal charges brought against indigent inmates who are incarcerated in a Minnesota
187.5state correctional facility are the responsibility of the state Board of Public Defense. In
187.6such cases the state public defender may follow the procedures outlined in this section for
187.7obtaining court-ordered counsel.
187.8EFFECTIVE DATE.This section is effective the day following final enactment.

187.9    Sec. 92. Minnesota Statutes 2012, section 611.27, subdivision 15, is amended to read:
187.10    Subd. 15. Costs of transcripts. In appeal cases and postconviction cases where
187.11the appellate public defender's office does not have sufficient funds to pay for transcripts
187.12and other necessary expenses because it has spent or committed all of the transcript
187.13funds in its annual budget, the state public defender may forward to the commissioner
187.14of management and budget all billings for transcripts and other necessary expenses. The
187.15commissioner shall pay for these transcripts and other necessary expenses from county
187.16program aid retained by the commissioner of revenue for that purpose under section
187.17477A.0124, subdivision 1, clause (4), or 477A.03, subdivision 2b, paragraph (a).
187.18EFFECTIVE DATE.This section is effective the day following final enactment.

187.19    Sec. 93. REVISOR'S INSTRUCTION.
187.20The revisor of statutes shall make all necessary cross-reference changes in
187.21Minnesota Statutes and Minnesota Rules consistent with the amendments and repealers in
187.22this article. The revisor can make changes to sentence structure to preserve the meaning of
187.23the text. The revisor shall make other changes in chapter titles; section, subdivision, part,
187.24and subpart headnotes; and in other terminology necessary as a result of the enactment of
187.25this act. The Department of Revenue shall assist in making these corrections.

187.26    Sec. 94. REPEALER.
187.27(a) Minnesota Statutes 2012, sections 273.1398, subdivision 4b; 290.01, subdivision
187.2819e; 290.0674, subdivision 3; 290.191, subdivision 4; and 290.33, and Minnesota Rules,
187.29part 8007.0200, are repealed.
187.30(b) Minnesota Statutes 2012, sections 16D.02, subdivisions 5 and 8; 16D.11,
187.31subdivision 2; 270C.53; 270C.991, subdivision 4; 272.02, subdivisions 1, 1a, 43, 48, 51,
187.3253, 67, 72, and 82; 272.027, subdivision 2; 272.031; 273.015, subdivision 1; 273.03,
188.1subdivision 3; 273.075; 273.13, subdivision 21a; 273.1383; 273.1386; 273.80; 275.77;
188.2279.32; 281.173, subdivision 8; 281.174, subdivision 8; 281.328; 282.10; 282.23; 287.20,
188.3subdivision 4; 287.27, subdivision 2; 290.01, subdivisions 4b and 20e; 295.52, subdivision
188.47; 297A.666; 297A.71, subdivisions 4, 5, 7, 9, 10, 17, 18, 20, 32, and 41; 297F.08,
188.5subdivision 11; 297H.10, subdivision 2; 469.174, subdivision 10c; 469.175, subdivision
188.62b; 469.176, subdivision 1i; 469.177, subdivision 10; 477A.0124, subdivisions 1 and 6;
188.7and 505.173,Minnesota Statutes 2013 Supplement, section 273.1103, Laws 1993, chapter
188.8375, article 9, section 47, and Minnesota Rules, parts 8002.0200, subpart 8; 8100.0800;
188.9and 8130.7500, subpart 7, are repealed.
188.10(c) Minnesota Statutes 2012, section 469.1764, is repealed.
188.11(d) Minnesota Statutes 2012, sections 289A.56, subdivision 7; 297A.68, subdivision
188.1238; 469.330; 469.331; 469.332; 469.333; 469.334; 469.335; 469.336; 469.337; 469.338;
188.13469.339; 469.340, subdivisions 1, 2, 3, and 5; and 469.341, and Minnesota Statutes 2013
188.14Supplement, section 469.340, subdivision 4, are repealed.
188.15(e) Minnesota Statutes 2012, section 290.06, subdivisions 30 and 31, are repealed.
188.16EFFECTIVE DATE.Paragraph (a) is effective for taxable years beginning after
188.17December 31, 2013.
188.18Paragraph (b) is effective the day following final enactment.
188.19Paragraph (c) is effective the day following final enactment and any remaining
188.20unexpended tax increments from a district subject to Minnesota Statutes, section 469.1764,
188.21must be distributed as excess increments to the city, county, and school district under
188.22Minnesota Statutes, section 469.176, subdivision 2, paragraph (c), clause (4), on or before
188.23December 31, 2014.
188.24Paragraph (d) is effective the day following final enactment.
188.25Paragraph (e) is effective for taxable years beginning after December 31, 2013.

188.26ARTICLE 10
188.27DEPARTMENT OF REVENUE - TECHNICAL AND POLICY
188.28PROPERTY TAX PROVISIONS

188.29    Section 1. Minnesota Statutes 2012, section 270.87, is amended to read:
188.30270.87 CERTIFICATION TO COUNTY ASSESSORS.
188.31After making an annual determination of the equalized fair market value of the
188.32operating property of each company in each of the respective counties, and in the taxing
188.33districts therein, the commissioner shall certify the equalized fair market value to the
188.34county assessor on or before June 30. The equalized fair market value of the operating
189.1property of the railroad company in the county and the taxing districts therein is the value
189.2on which taxes must be levied and collected in the same manner as on the commercial and
189.3industrial property of such county and the taxing districts therein. If the commissioner
189.4determines that the equalized fair market value certified on or before June 30 is in error,
189.5the commissioner may issue a corrected certification on or before August 31. The
189.6commissioner may correct errors that are merely clerical in nature until December 31.
189.7EFFECTIVE DATE.This section is effective the day following final enactment.

189.8    Sec. 2. Minnesota Statutes 2012, section 272.029, subdivision 4a, is amended to read:
189.9    Subd. 4a. Correction of errors. If the commissioner of revenue determines that
189.10the amount of production tax has been erroneously calculated, the commissioner may
189.11correct the error. The commissioner must notify the owner of the wind energy conversion
189.12system of the correction and the amount of tax due to each county and must certify the
189.13correction to the county auditor of each county in which the system is located on or before
189.14April 1 of the current year. The commissioner may correct errors that are merely clerical
189.15in nature until December 31.
189.16EFFECTIVE DATE.This section is effective the day following final enactment.

189.17    Sec. 3. Minnesota Statutes 2012, section 273.01, is amended to read:
189.18273.01 LISTING AND ASSESSMENT, TIME.
189.19All real property subject to taxation shall be listed and at least one-fifth of the parcels
189.20listed shall be appraised each year with reference to their value on January 2 preceding the
189.21assessment so that each parcel shall be reappraised at maximum intervals of five years. All
189.22real property becoming taxable in any year shall be listed with reference to its value on
189.23January 2 of that year. Except as provided in this section and section 274.01, subdivision
189.241
, all real property assessments shall be completed two weeks prior to the date scheduled
189.25for the local board of review or equalization. No changes in valuation or classification
189.26which are intended to correct errors in judgment by the county assessor may be made by
189.27the county assessor after the board of review or the county board of equalization has
189.28adjourned; however, corrections of errors for real or personal property that are merely
189.29clerical in nature or changes that extend homestead treatment to property are permitted
189.30after adjournment until the tax extension date for that assessment year. Any changes made
189.31by the assessor after adjournment must be fully documented and maintained in a file in the
189.32assessor's office and shall be available for review by any person. A copy of any changes
189.33made during this period shall be sent to the county board no later than December 31 of
190.1the assessment year. In the event a valuation and classification is not placed on any real
190.2property by the dates scheduled for the local board of review or equalization the valuation
190.3and classification determined in the preceding assessment shall be continued in effect and
190.4the provisions of section 273.13 shall, in such case, not be applicable, except with respect
190.5to real estate which has been constructed since the previous assessment. Real property
190.6containing iron ore, the fee to which is owned by the state of Minnesota, shall, if leased by
190.7the state after January 2 in any year, be subject to assessment for that year on the value of
190.8any iron ore removed under said lease prior to January 2 of the following year. Personal
190.9property subject to taxation shall be listed and assessed annually with reference to its value
190.10on January 2; and, if acquired on that day, shall be listed by or for the person acquiring it.
190.11EFFECTIVE DATE.This section is effective the day following final enactment.

190.12    Sec. 4. Minnesota Statutes 2013 Supplement, section 273.13, subdivision 25, is
190.13amended to read:
190.14    Subd. 25. Class 4. (a) Class 4a is residential real estate containing four or more
190.15units and used or held for use by the owner or by the tenants or lessees of the owner
190.16as a residence for rental periods of 30 days or more, excluding property qualifying for
190.17class 4d. Class 4a also includes hospitals licensed under sections 144.50 to 144.56, other
190.18than hospitals exempt under section 272.02, and contiguous property used for hospital
190.19purposes, without regard to whether the property has been platted or subdivided. The
190.20market value of class 4a property has a class rate of 1.25 percent.
190.21    (b) Class 4b includes:
190.22    (1) residential real estate containing less than four units that does not qualify as class
190.234bb, other than seasonal residential recreational property;
190.24    (2) manufactured homes not classified under any other provision;
190.25    (3) a dwelling, garage, and surrounding one acre of property on a nonhomestead
190.26farm classified under subdivision 23, paragraph (b) containing two or three units; and
190.27    (4) unimproved property that is classified residential as determined under subdivision
190.2833.
190.29    The market value of class 4b property has a class rate of 1.25 percent.
190.30    (c) Class 4bb includes nonhomestead residential real estate containing one unit,
190.31other than seasonal residential recreational property, and a single family dwelling, garage,
190.32and surrounding one acre of property on a nonhomestead farm classified under subdivision
190.3323, paragraph (b).
190.34    Class 4bb property has the same class rates as class 1a property under subdivision 22.
191.1    Property that has been classified as seasonal residential recreational property at
191.2any time during which it has been owned by the current owner or spouse of the current
191.3owner does not qualify for class 4bb.
191.4    (d) Class 4c property includes:
191.5    (1) except as provided in subdivision 22, paragraph (c), real and personal property
191.6devoted to commercial temporary and seasonal residential occupancy for recreation
191.7purposes, for not more than 250 days in the year preceding the year of assessment. For
191.8purposes of this clause, property is devoted to a commercial purpose on a specific day
191.9if any portion of the property is used for residential occupancy, and a fee is charged for
191.10residential occupancy. Class 4c property under this clause must contain three or more
191.11rental units. A "rental unit" is defined as a cabin, condominium, townhouse, sleeping room,
191.12or individual camping site equipped with water and electrical hookups for recreational
191.13vehicles. A camping pad offered for rent by a property that otherwise qualifies for class
191.144c under this clause is also class 4c under this clause regardless of the term of the rental
191.15agreement, as long as the use of the camping pad does not exceed 250 days. In order for a
191.16property to be classified under this clause, either (i) the business located on the property
191.17must provide recreational activities, at least 40 percent of the annual gross lodging receipts
191.18related to the property must be from business conducted during 90 consecutive days,
191.19and either (A) at least 60 percent of all paid bookings by lodging guests during the year
191.20must be for periods of at least two consecutive nights; or (B) at least 20 percent of the
191.21annual gross receipts must be from charges for providing recreational activities, or (ii) the
191.22business must contain 20 or fewer rental units, and must be located in a township or a city
191.23with a population of 2,500 or less located outside the metropolitan area, as defined under
191.24section 473.121, subdivision 2, that contains a portion of a state trail administered by the
191.25Department of Natural Resources. For purposes of item (i)(A), a paid booking of five or
191.26more nights shall be counted as two bookings. Class 4c property also includes commercial
191.27use real property used exclusively for recreational purposes in conjunction with other class
191.284c property classified under this clause and devoted to temporary and seasonal residential
191.29occupancy for recreational purposes, up to a total of two acres, provided the property is
191.30not devoted to commercial recreational use for more than 250 days in the year preceding
191.31the year of assessment and is located within two miles of the class 4c property with which
191.32it is used. In order for a property to qualify for classification under this clause, the owner
191.33must submit a declaration to the assessor designating the cabins or units occupied for 250
191.34days or less in the year preceding the year of assessment by January 15 of the assessment
191.35year. Those cabins or units and a proportionate share of the land on which they are located
191.36must be designated class 4c under this clause as otherwise provided. The remainder of the
192.1cabins or units and a proportionate share of the land on which they are located will be
192.2designated as class 3a. The owner of property desiring designation as class 4c property
192.3under this clause must provide guest registers or other records demonstrating that the units
192.4for which class 4c designation is sought were not occupied for more than 250 days in the
192.5year preceding the assessment if so requested. The portion of a property operated as a
192.6(1) restaurant, (2) bar, (3) gift shop, (4) conference center or meeting room, and (5) other
192.7nonresidential facility operated on a commercial basis not directly related to temporary and
192.8seasonal residential occupancy for recreation purposes does not qualify for class 4c. For
192.9the purposes of this paragraph, "recreational activities" means renting ice fishing houses,
192.10boats and motors, snowmobiles, downhill or cross-country ski equipment; providing
192.11marina services, launch services, or guide services; or selling bait and fishing tackle;
192.12    (2) qualified property used as a golf course if:
192.13    (i) it is open to the public on a daily fee basis. It may charge membership fees or
192.14dues, but a membership fee may not be required in order to use the property for golfing,
192.15and its green fees for golfing must be comparable to green fees typically charged by
192.16municipal courses; and
192.17    (ii) it meets the requirements of section 273.112, subdivision 3, paragraph (d).
192.18    A structure used as a clubhouse, restaurant, or place of refreshment in conjunction
192.19with the golf course is classified as class 3a property;
192.20    (3) real property up to a maximum of three acres of land owned and used by a
192.21nonprofit community service oriented organization and not used for residential purposes
192.22on either a temporary or permanent basis, provided that:
192.23    (i) the property is not used for a revenue-producing activity for more than six days
192.24in the calendar year preceding the year of assessment; or
192.25    (ii) the organization makes annual charitable contributions and donations at least
192.26equal to the property's previous year's property taxes and the property is allowed to be
192.27used for public and community meetings or events for no charge, as appropriate to the
192.28size of the facility.
192.29    For purposes of this clause:
192.30    (A) "charitable contributions and donations" has the same meaning as lawful
192.31gambling purposes under section 349.12, subdivision 25, excluding those purposes
192.32relating to the payment of taxes, assessments, fees, auditing costs, and utility payments;
192.33    (B) "property taxes" excludes the state general tax;
192.34    (C) a "nonprofit community service oriented organization" means any corporation,
192.35society, association, foundation, or institution organized and operated exclusively for
192.36charitable, religious, fraternal, civic, or educational purposes, and which is exempt from
193.1federal income taxation pursuant to section 501(c)(3), (8), (10), or (19) of the Internal
193.2Revenue Code; and
193.3    (D) "revenue-producing activities" shall include but not be limited to property or that
193.4portion of the property that is used as an on-sale intoxicating liquor or 3.2 percent malt
193.5liquor establishment licensed under chapter 340A, a restaurant open to the public, bowling
193.6alley, a retail store, gambling conducted by organizations licensed under chapter 349, an
193.7insurance business, or office or other space leased or rented to a lessee who conducts a
193.8for-profit enterprise on the premises.
193.9    Any portion of the property not qualifying under either item (i) or (ii) is class 3a.
193.10The use of the property for social events open exclusively to members and their guests
193.11for periods of less than 24 hours, when an admission is not charged nor any revenues are
193.12received by the organization shall not be considered a revenue-producing activity.
193.13    The organization shall maintain records of its charitable contributions and donations
193.14and of public meetings and events held on the property and make them available upon
193.15request any time to the assessor to ensure eligibility. An organization meeting the
193.16requirement under item (ii) must file an application by May 1 with the assessor for
193.17eligibility for the current year's assessment. The commissioner shall prescribe a uniform
193.18application form and instructions;
193.19    (4) postsecondary student housing of not more than one acre of land that is owned by
193.20a nonprofit corporation organized under chapter 317A and is used exclusively by a student
193.21cooperative, sorority, or fraternity for on-campus housing or housing located within two
193.22miles of the border of a college campus;
193.23    (5)(i) manufactured home parks as defined in section 327.14, subdivision 3,
193.24excluding manufactured home parks described in section 273.124, subdivision 3a, and (ii)
193.25manufactured home parks as defined in section 327.14, subdivision 3, that are described in
193.26section 273.124, subdivision 3a;
193.27    (6) real property that is actively and exclusively devoted to indoor fitness, health,
193.28social, recreational, and related uses, is owned and operated by a not-for-profit corporation,
193.29and is located within the metropolitan area as defined in section 473.121, subdivision 2;
193.30    (7) a leased or privately owned noncommercial aircraft storage hangar not exempt
193.31under section 272.01, subdivision 2, and the land on which it is located, provided that:
193.32    (i) the land is on an airport owned or operated by a city, town, county, Metropolitan
193.33Airports Commission, or group thereof; and
193.34    (ii) the land lease, or any ordinance or signed agreement restricting the use of the
193.35leased premise, prohibits commercial activity performed at the hangar.
194.1    If a hangar classified under this clause is sold after June 30, 2000, a bill of sale must
194.2be filed by the new owner with the assessor of the county where the property is located
194.3within 60 days of the sale;
194.4    (8) a privately owned noncommercial aircraft storage hangar not exempt under
194.5section 272.01, subdivision 2, and the land on which it is located, provided that:
194.6    (i) the land abuts a public airport; and
194.7    (ii) the owner of the aircraft storage hangar provides the assessor with a signed
194.8agreement restricting the use of the premises, prohibiting commercial use or activity
194.9performed at the hangar; and
194.10    (9) residential real estate, a portion of which is used by the owner for homestead
194.11purposes, and that is also a place of lodging, if all of the following criteria are met:
194.12    (i) rooms are provided for rent to transient guests that generally stay for periods
194.13of 14 or fewer days;
194.14    (ii) meals are provided to persons who rent rooms, the cost of which is incorporated
194.15in the basic room rate;
194.16    (iii) meals are not provided to the general public except for special events on fewer
194.17than seven days in the calendar year preceding the year of the assessment; and
194.18    (iv) the owner is the operator of the property.
194.19    The market value subject to the 4c classification under this clause is limited to
194.20five rental units. Any rental units on the property in excess of five, must be valued and
194.21assessed as class 3a. The portion of the property used for purposes of a homestead by the
194.22owner must be classified as class 1a property under subdivision 22;
194.23    (10) real property up to a maximum of three acres and operated as a restaurant
194.24as defined under section 157.15, subdivision 12, provided it: (A) is located on a lake
194.25as defined under section 103G.005, subdivision 15, paragraph (a), clause (3); and (B)
194.26is either devoted to commercial purposes for not more than 250 consecutive days, or
194.27receives at least 60 percent of its annual gross receipts from business conducted during
194.28four consecutive months. Gross receipts from the sale of alcoholic beverages must be
194.29included in determining the property's qualification under subitem (B). The property's
194.30primary business must be as a restaurant and not as a bar. Gross receipts from gift shop
194.31sales located on the premises must be excluded. Owners of real property desiring 4c
194.32classification under this clause must submit an annual declaration to the assessor by
194.33February 1 of the current assessment year, based on the property's relevant information for
194.34the preceding assessment year;
194.35(11) lakeshore and riparian property and adjacent land, not to exceed six acres, used
194.36as a marina, as defined in section 86A.20, subdivision 5, which is made accessible to
195.1the public and devoted to recreational use for marina services. The marina owner must
195.2annually provide evidence to the assessor that it provides services, including lake or river
195.3access to the public by means of an access ramp or other facility that is either located on
195.4the property of the marina or at a publicly owned site that abuts the property of the marina.
195.5No more than 800 feet of lakeshore may be included in this classification. Buildings used
195.6in conjunction with a marina for marina services, including but not limited to buildings
195.7used to provide food and beverage services, fuel, boat repairs, or the sale of bait or fishing
195.8tackle, are classified as class 3a property; and
195.9(12) real and personal property devoted to noncommercial temporary and seasonal
195.10residential occupancy for recreation purposes.
195.11    Class 4c property has a class rate of 1.5 percent of market value, except that (i) each
195.12parcel of noncommercial seasonal residential recreational property under clause (12)
195.13has the same class rates as class 4bb property, (ii) manufactured home parks assessed
195.14under clause (5), item (i), have the same class rate as class 4b property, and the market
195.15value of manufactured home parks assessed under clause (5), item (ii), has the same class
195.16rate as class 4d property has a classification rate of 0.75 percent if more than 50 percent
195.17of the lots in the park are occupied by shareholders in the cooperative corporation or
195.18association and a class rate of one percent if 50 percent or less of the lots are so occupied,
195.19(iii) commercial-use seasonal residential recreational property and marina recreational
195.20land as described in clause (11), has a class rate of one percent for the first $500,000 of
195.21market value, and 1.25 percent for the remaining market value, (iv) the market value of
195.22property described in clause (4) has a class rate of one percent, (v) the market value of
195.23property described in clauses (2), (6), and (10) has a class rate of 1.25 percent, and (vi)
195.24that portion of the market value of property in clause (9) qualifying for class 4c property
195.25has a class rate of 1.25 percent.
195.26    (e) Class 4d property is qualifying low-income rental housing certified to the assessor
195.27by the Housing Finance Agency under section 273.128, subdivision 3. If only a portion
195.28of the units in the building qualify as low-income rental housing units as certified under
195.29section 273.128, subdivision 3, only the proportion of qualifying units to the total number
195.30of units in the building qualify for class 4d. The remaining portion of the building shall be
195.31classified by the assessor based upon its use. Class 4d also includes the same proportion of
195.32land as the qualifying low-income rental housing units are to the total units in the building.
195.33For all properties qualifying as class 4d, the market value determined by the assessor must
195.34be based on the normal approach to value using normal unrestricted rents.
195.35    (f) The first tier of market value of class 4d property has a class rate of 0.75 percent.
195.36The remaining value of class 4d property has a class rate of 0.25 percent. For the purposes
196.1of this paragraph, the "first tier of market value of class 4d property" means the market
196.2value of each housing unit up to the first tier limit. For the purposes of this paragraph, all
196.3class 4d property value must be assigned to individual housing units. The first tier limit is
196.4$100,000 for assessment year 2014. For subsequent years, the limit is adjusted each year
196.5by the average statewide change in estimated market value of property classified as class 4a
196.6and 4d under this section for the previous assessment year, excluding valuation change due
196.7to new construction, rounded to the nearest $1,000, provided, however, that the limit may
196.8never be less than $100,000. Beginning with assessment year 2015, the commissioner of
196.9revenue must certify the limit for each assessment year by November 1 of the previous year.
196.10EFFECTIVE DATE.This section is effective beginning with assessment year 2014.

196.11    Sec. 5. Minnesota Statutes 2013 Supplement, section 273.1325, subdivision 1, is
196.12amended to read:
196.13    Subdivision 1. Computation. The Department of Revenue must annually conduct
196.14an assessment/sales ratio study of the taxable property in each county, city, town, and
196.15school district in accordance with the procedures in subdivisions 2 and 3. Based upon the
196.16results of this assessment/sales ratio study, the Department of Revenue must determine
196.17an equalized net tax capacity for the various classes of taxable property in each taxing
196.18district, the aggregate of which is designated as the adjusted net tax capacity. The adjusted
196.19net tax capacity must be reduced by the captured tax capacity of tax increment districts
196.20under section 469.177, subdivision 2, fiscal disparities contribution tax capacities under
196.21sections 276A.06 and 473F.08, and the tax capacity of transmission lines required to be
196.22subtracted from the local tax base under section 273.425; and increased by fiscal disparities
196.23distribution tax capacities under sections 276A.06 and 473F.08. The adjusted net tax
196.24capacities shall be determined using the net tax capacity percentages in effect for the
196.25assessment year following the assessment year of the study. The Department of Revenue
196.26must make whatever estimates are necessary to account for changes in the classification
196.27system. The Department of Revenue may incur the expense necessary to make the
196.28determinations. The commissioner of revenue may reimburse any county or governmental
196.29official for requested services performed in ascertaining the adjusted net tax capacity. On
196.30or before March 15 annually, the Department of Revenue shall file with the chair of the
196.31Tax Committee of the house of representatives and the chair of the Committee on Taxes
196.32and Tax laws of the senate a report of adjusted net tax capacities for school districts.
196.33On or before June 15 30 annually, the Department of Revenue shall file its final report
196.34on the adjusted net tax capacities for school districts established by the previous year's
196.35assessments and the current year's net tax capacity percentages with the commissioner of
197.1education and each county auditor for those school districts for which the auditor has the
197.2responsibility for determination of local tax rates. A copy of the report so filed shall be
197.3mailed to the clerk of each school district involved and to the county assessor or supervisor
197.4of assessments of the county or counties in which each school district is located.
197.5EFFECTIVE DATE.This section is effective January 1, 2014.

197.6    Sec. 6. Minnesota Statutes 2012, section 273.33, subdivision 2, is amended to read:
197.7    Subd. 2. Listing and assessment by commissioner. The personal property,
197.8consisting of the pipeline system of mains, pipes, and equipment attached thereto, of
197.9pipeline companies and others engaged in the operations or business of transporting natural
197.10gas, gasoline, crude oil, or other petroleum products by pipelines, shall be listed with and
197.11assessed by the commissioner of revenue and the values provided to the city or county
197.12assessor by order. This subdivision shall not apply to the assessment of the products
197.13transported through the pipelines nor to the lines of local commercial gas companies
197.14engaged primarily in the business of distributing gas to consumers at retail nor to pipelines
197.15used by the owner thereof to supply natural gas or other petroleum products exclusively
197.16for such owner's own consumption and not for resale to others. If more than 85 percent
197.17of the natural gas or other petroleum products actually transported over the pipeline is
197.18used for the owner's own consumption and not for resale to others, then this subdivision
197.19shall not apply; provided, however, that in that event, the pipeline shall be assessed in
197.20proportion to the percentage of gas actually transported over such pipeline that is not used
197.21for the owner's own consumption. On or before August 1, the commissioner shall certify
197.22to the auditor of each county, the amount of such personal property assessment against
197.23each company in each district in which such property is located. If the commissioner
197.24determines that the amount of personal property assessment certified on or before August
197.251 is in error, the commissioner may issue a corrected certification on or before October 1.
197.26 The commissioner may correct errors that are merely clerical in nature until December 31.
197.27EFFECTIVE DATE.This section is effective the day following final enactment.

197.28    Sec. 7. Minnesota Statutes 2012, section 273.37, subdivision 2, is amended to read:
197.29    Subd. 2. Listing and assessment by commissioner. Transmission lines of less
197.30than 69 kv, transmission lines of 69 kv and above located in an unorganized township,
197.31and distribution lines, and equipment attached thereto, having a fixed situs outside the
197.32corporate limits of cities except distribution lines taxed as provided in sections 273.40
197.33and 273.41, shall be listed with and assessed by the commissioner of revenue in the
198.1county where situated and the values provided to the city or county assessor by order.
198.2The commissioner shall assess such property at the percentage of market value fixed by
198.3law; and, on or before August 1, shall certify to the auditor of each county in which
198.4such property is located the amount of the assessment made against each company and
198.5person owning such property. If the commissioner determines that the amount of the
198.6assessment certified on or before August 1 is in error, the commissioner may issue a
198.7corrected certification on or before October 1. The commissioner may correct errors that
198.8are merely clerical in nature until December 31.
198.9EFFECTIVE DATE.This section is effective the day following final enactment.

198.10    Sec. 8. Minnesota Statutes 2012, section 273.3711, is amended to read:
198.11273.3711 RECOMMENDED AND ORDERED VALUES.
198.12    For purposes of sections 273.33, 273.35, 273.36, 273.37, 273.371, and 273.372,
198.13all values not required to be listed and assessed by the commissioner of revenue are
198.14recommended values. If the commissioner provides recommended values, the values must
198.15be certified to the auditor of each county in which the property is located on or before
198.16August 1. If the commissioner determines that the certified recommended value is in
198.17error the commissioner may issue a corrected certification on or before October 1. The
198.18commissioner may correct errors that are merely clerical in nature until December 31.
198.19EFFECTIVE DATE.This section is effective the day following final enactment.

198.20    Sec. 9. Minnesota Statutes 2012, section 274.01, subdivision 1, is amended to read:
198.21    Subdivision 1. Ordinary board; meetings, deadlines, grievances. (a) The town
198.22board of a town, or the council or other governing body of a city, is the board of appeal
198.23and equalization except (1) in cities whose charters provide for a board of equalization or
198.24(2) in any city or town that has transferred its local board of review power and duties to
198.25the county board as provided in subdivision 3. The county assessor shall fix a day and
198.26time when the board or the board of equalization shall meet in the assessment districts
198.27of the county. Notwithstanding any law or city charter to the contrary, a city board of
198.28equalization shall be referred to as a board of appeal and equalization. On or before
198.29February 15 of each year the assessor shall give written notice of the time to the city or
198.30town clerk. Notwithstanding the provisions of any charter to the contrary, the meetings
198.31must be held between April 1 and May 31 each year. The clerk shall give published and
198.32posted notice of the meeting at least ten days before the date of the meeting.
199.1    The board shall meet either at a central location within the county or at the office of
199.2the clerk to review the assessment and classification of property in the town or city. No
199.3changes in valuation or classification which are intended to correct errors in judgment by
199.4the county assessor may be made by the county assessor after the board has adjourned
199.5in those cities or towns that hold a local board of review; however, corrections of errors
199.6that are merely clerical in nature or changes that extend homestead treatment to property
199.7are permitted after adjournment until the tax extension date for that assessment year. The
199.8changes must be fully documented and maintained in the assessor's office and must be
199.9available for review by any person. A copy of the changes made during this period in
199.10those cities or towns that hold a local board of review must be sent to the county board no
199.11later than December 31 of the assessment year.
199.12    (b) The board shall determine whether the taxable property in the town or city has
199.13been properly placed on the list and properly valued by the assessor. If real or personal
199.14property has been omitted, the board shall place it on the list with its market value, and
199.15correct the assessment so that each tract or lot of real property, and each article, parcel,
199.16or class of personal property, is entered on the assessment list at its market value. No
199.17assessment of the property of any person may be raised unless the person has been
199.18duly notified of the intent of the board to do so. On application of any person feeling
199.19aggrieved, the board shall review the assessment or classification, or both, and correct
199.20it as appears just. The board may not make an individual market value adjustment or
199.21classification change that would benefit the property if the owner or other person having
199.22control over the property has refused the assessor access to inspect the property and the
199.23interior of any buildings or structures as provided in section 273.20. A board member
199.24shall not participate in any actions of the board which result in market value adjustments
199.25or classification changes to property owned by the board member, the spouse, parent,
199.26stepparent, child, stepchild, grandparent, grandchild, brother, sister, uncle, aunt, nephew,
199.27or niece of a board member, or property in which a board member has a financial interest.
199.28The relationship may be by blood or marriage.
199.29    (c) A local board may reduce assessments upon petition of the taxpayer but the total
199.30reductions must not reduce the aggregate assessment made by the county assessor by more
199.31than one percent. If the total reductions would lower the aggregate assessments made by
199.32the county assessor by more than one percent, none of the adjustments may be made. The
199.33assessor shall correct any clerical errors or double assessments discovered by the board
199.34without regard to the one percent limitation.
199.35    (d) A local board does not have authority to grant an exemption or to order property
199.36removed from the tax rolls.
200.1    (e) A majority of the members may act at the meeting, and adjourn from day to day
200.2until they finish hearing the cases presented. The assessor shall attend, with the assessment
200.3books and papers, and take part in the proceedings, but must not vote. The county assessor,
200.4or an assistant delegated by the county assessor shall attend the meetings. The board shall
200.5list separately, on a form appended to the assessment book, all omitted property added
200.6to the list by the board and all items of property increased or decreased, with the market
200.7value of each item of property, added or changed by the board, placed opposite the item.
200.8The county assessor shall enter all changes made by the board in the assessment book.
200.9    (f) Except as provided in subdivision 3, if a person fails to appear in person, by
200.10counsel, or by written communication before the board after being duly notified of the
200.11board's intent to raise the assessment of the property, or if a person feeling aggrieved by an
200.12assessment or classification fails to apply for a review of the assessment or classification,
200.13the person may not appear before the county board of appeal and equalization for a review
200.14of the assessment or classification. This paragraph does not apply if an assessment was
200.15made after the local board meeting, as provided in section 273.01, or if the person can
200.16establish not having received notice of market value at least five days before the local
200.17board meeting.
200.18    (g) The local board must complete its work and adjourn within 20 days from the
200.19time of convening stated in the notice of the clerk, unless a longer period is approved by
200.20the commissioner of revenue. No action taken after that date is valid. All complaints
200.21about an assessment or classification made after the meeting of the board must be heard
200.22and determined by the county board of equalization. A nonresident may, at any time,
200.23before the meeting of the board file written objections to an assessment or classification
200.24with the county assessor. The objections must be presented to the board at its meeting by
200.25the county assessor for its consideration.
200.26EFFECTIVE DATE.This section is effective the day following final enactment.

200.27    Sec. 10. Minnesota Statutes 2012, section 274.014, subdivision 3, is amended to read:
200.28    Subd. 3. Proof of compliance; transfer of duties. (a) Any city or town that
200.29conducts local boards of appeal and equalization meetings must provide proof to the
200.30county assessor by December 1, 2006, and each year thereafter, February 1 that it is in
200.31compliance with the requirements of subdivision 2. Beginning in 2006, This notice must
200.32also verify that there was a quorum of voting members at each meeting of the board
200.33of appeal and equalization in the current previous year. A city or town that does not
200.34comply with these requirements is deemed to have transferred its board of appeal and
201.1equalization powers to the county beginning with the following current year's assessment
201.2and continuing unless the powers are reinstated under paragraph (c).
201.3    (b) The county shall notify the taxpayers when the board of appeal and equalization
201.4for a city or town has been transferred to the county under this subdivision and, prior to
201.5the meeting time of the county board of equalization, the county shall make available to
201.6those taxpayers a procedure for a review of the assessments, including, but not limited to,
201.7open book meetings. This alternate review process shall take place in April and May.
201.8    (c) A local board whose powers are transferred to the county under this subdivision
201.9may be reinstated by resolution of the governing body of the city or town and upon proof
201.10of compliance with the requirements of subdivision 2. The resolution and proofs must be
201.11provided to the county assessor by December 1 February 1 in order to be effective for
201.12the following year's assessment.
201.13    (d) A local board whose powers are transferred to the county under this subdivision
201.14may continue to employ a local assessor and is not deemed to have transferred its powers
201.15to make assessments.
201.16EFFECTIVE DATE.This section is effective beginning with local boards of appeal
201.17and equalization meetings held after February 1, 2016.

201.18    Sec. 11. Minnesota Statutes 2013 Supplement, section 423A.02, subdivision 3, is
201.19amended to read:
201.20    Subd. 3. Reallocation of amortization state aid. (a) Seventy percent of the
201.21difference between $5,720,000 and the current year amortization aid distributed under
201.22subdivision 1 that is not distributed for any reason to a municipality must be distributed
201.23by the commissioner of revenue according to this paragraph. The commissioner shall
201.24distribute 50 percent of the amounts derived under this paragraph to the Teachers
201.25Retirement Association, ten percent to the Duluth Teachers Retirement Fund Association,
201.26and 40 percent to the St. Paul Teachers Retirement Fund Association to fund the unfunded
201.27actuarial accrued liabilities of the respective funds. These payments must be made on July
201.2815 each fiscal year. If the St. Paul Teachers Retirement Fund Association or the Duluth
201.29Teachers Retirement Fund Association becomes fully funded, the association's eligibility
201.30for its portion of this aid ceases. Amounts remaining in the undistributed balance account
201.31at the end of the biennium if aid eligibility ceases cancel to the general fund.
201.32    (b) In order to receive amortization aid under paragraph (a), before June 30 annually
201.33Independent School District No. 625, St. Paul, must make an additional contribution of
201.34$800,000 each year to the St. Paul Teachers Retirement Fund Association.
202.1    (c) Thirty percent of the difference between $5,720,000 and the current year
202.2amortization aid under subdivision 1a 1 that is not distributed for any reason to a
202.3municipality must be distributed under section 69.021, subdivision 7, paragraph (d), as
202.4additional funding to support a minimum fire state aid amount for volunteer firefighter
202.5relief associations.
202.6EFFECTIVE DATE.This section is effective retroactively from June 1, 2013.

202.7    Sec. 12. REVISOR'S INSTRUCTION.
202.8The revisor of statutes shall change the terms "class rate" or "class rates" to
202.9"classification rate" or "classification rates" or similar terms wherever they appear in
202.10Minnesota Statutes when the terms are being used to refer to the calculation of net tax
202.11capacity in the property tax system. The revisor can make changes to sentence structure
202.12to preserve the meaning of the text. The revisor shall make other changes in section and
202.13subdivision headnotes and in other terminology as necessary as a result of the enactment
202.14of this section. The Department of Revenue shall assist in making these corrections.

202.15ARTICLE 11
202.16DEPARTMENT OF REVENUE - TECHNICAL AND POLICY INCOME AND
202.17FRANCHISE, SALES AND USE, AND MISCELLANEOUS TAX PROVISIONS

202.18    Section 1. Minnesota Statutes 2012, section 270C.34, subdivision 2, is amended to read:
202.19    Subd. 2. Procedure. (a) A request for abatement of penalty under subdivision 1 or
202.20section 289A.60, subdivision 4, or a request for abatement of interest or additional tax
202.21charge, must be filed with the commissioner within 60 days of the date the notice was
202.22mailed to the taxpayer's last known address, stating that a penalty has been imposed.
202.23(b) If the commissioner issues an order denying a request for abatement of penalty,
202.24interest, or additional tax charge, the taxpayer may file an administrative appeal as
202.25provided in section 270C.35 or appeal to Tax Court as provided in section 271.06.
202.26(c) If the commissioner does not issue an order on the abatement request within
202.2760 days from the date the request is received, the taxpayer may appeal to Tax Court as
202.28provided in section 271.06.
202.29EFFECTIVE DATE.This section is effective the day following final enactment.

202.30    Sec. 2. Minnesota Statutes 2012, section 270C.56, subdivision 3, is amended to read:
202.31    Subd. 3. Procedure for assessment; claims for refunds. (a) The commissioner
202.32may assess liability for the taxes described in subdivision 1 against a person liable
203.1under this section. The assessment may be based upon information available to the
203.2commissioner. It must be made within the prescribed period of limitations for assessing
203.3the underlying tax, or within one year after the date of an order assessing underlying
203.4tax, or within one year after the date of a final administrative or judicial determination,
203.5whichever period expires later. An order assessing personal liability under this section is
203.6reviewable under section 270C.35 and is appealable to Tax Court.
203.7(b) If the time for appealing the order has expired and a payment is made by or
203.8collected from the person assessed on the order in excess of the amount lawfully due
203.9from that person of any portion of the liability shown on the order, a claim for refund
203.10may be made by that person within 120 days after any payment of the liability if the
203.11payment is within 3-1/2 years after the date the order was issued. Claims for refund under
203.12this paragraph are limited to the amount paid during the 120-day period. Any amounts
203.13collected under paragraph (c) after a claim for refund is filed in order to satisfy the unpaid
203.14balance of the assessment that is the subject of the claim shall be returned if the claim is
203.15allowed. There is no claim for refund available under this paragraph if the assessment has
203.16previously been the subject of an administrative or Tax Court appeal, or a denied claim
203.17for refund. The taxpayer may contest denial of the refund as provided in the procedures
203.18governing claims for refunds under section 289A.50, subdivision 7.
203.19(c) If a person has been assessed under this section for an amount for a given period
203.20and the time for appeal has expired, regardless of whether an action contesting denial of a
203.21claim for refund has been filed under paragraph (b), or there has been a final determination
203.22that the person is liable, collection action is not stayed pursuant to section 270C.33,
203.23subdivision 5
, for that assessment or for subsequent assessments of additional amounts for
203.24the same person for the same period and tax type.
203.25EFFECTIVE DATE.This section is effective the day following final enactment.

203.26    Sec. 3. Minnesota Statutes 2012, section 289A.18, subdivision 2, is amended to read:
203.27    Subd. 2. Withholding returns, entertainer withholding returns, returns for
203.28withholding from payments to out-of-state contractors, and withholding returns
203.29from partnerships and S corporations. (a) Withholding returns for the first, second,
203.30 and third quarters are due on or before the last day of the month following the close of
203.31the quarterly period. However, if the return shows timely deposits in full payment of
203.32the taxes due for that period, the returns for the first, second, and third quarters may be
203.33filed on or before the tenth day of the second calendar month following the period. The
203.34return for the fourth quarter must be filed on or before the 28th day of the second calendar
203.35month following the period. An employer, in preparing a quarterly return, may take credit
204.1for deposits previously made for that quarter. Entertainer withholding tax returns are
204.2due within 30 days after each performance. Returns for withholding from payments to
204.3out-of-state contractors are due within 30 days after the payment to the contractor. Returns
204.4for withholding by partnerships are due on or before the due date specified for filing
204.5partnership returns. Returns for withholding by S corporations are due on or before the
204.6due date specified for filing corporate franchise tax returns.
204.7(b) A seasonal employer who provides notice in the form and manner prescribed
204.8by the commissioner before the end of the calendar quarter is not required to file a
204.9withholding tax return for periods of anticipated inactivity unless the employer pays wages
204.10during the period from which tax is withheld. For purposes of this paragraph, a seasonal
204.11employer is an employer that regularly, in the same one or more quarterly periods of each
204.12calendar year, pays no wages to employees.
204.13EFFECTIVE DATE.(a) The amendments in paragraph (a) are effective for returns
204.14due after January 1, 2016.
204.15(b) The amendment adding paragraph (b) is effective for wages paid after December
204.1631, 2015.

204.17    Sec. 4. Minnesota Statutes 2013 Supplement, section 290.191, subdivision 5, is
204.18amended to read:
204.19    Subd. 5. Determination of sales factor. For purposes of this section, the following
204.20rules apply in determining the sales factor.
204.21    (a) The sales factor includes all sales, gross earnings, or receipts received in the
204.22ordinary course of the business, except that the following types of income are not included
204.23in the sales factor:
204.24    (1) interest;
204.25    (2) dividends;
204.26    (3) sales of capital assets as defined in section 1221 of the Internal Revenue Code;
204.27    (4) sales of property used in the trade or business, except sales of leased property of
204.28a type which is regularly sold as well as leased; and
204.29    (5) sales of debt instruments as defined in section 1275(a)(1) of the Internal Revenue
204.30Code or sales of stock.
204.31    (b) Sales of tangible personal property are made within this state if the property is
204.32received by a purchaser at a point within this state, and the taxpayer is taxable in this state,
204.33 regardless of the f.o.b. point, other conditions of the sale, or the ultimate destination
204.34of the property.
205.1    (c) Tangible personal property delivered to a common or contract carrier or foreign
205.2vessel for delivery to a purchaser in another state or nation is a sale in that state or nation,
205.3regardless of f.o.b. point or other conditions of the sale.
205.4    (d) Notwithstanding paragraphs (b) and (c), when intoxicating liquor, wine,
205.5fermented malt beverages, cigarettes, or tobacco products are sold to a purchaser who is
205.6licensed by a state or political subdivision to resell this property only within the state of
205.7ultimate destination, the sale is made in that state.
205.8    (e) Sales made by or through a corporation that is qualified as a domestic
205.9international sales corporation under section 992 of the Internal Revenue Code are not
205.10considered to have been made within this state.
205.11    (f) Sales, rents, royalties, and other income in connection with real property is
205.12attributed to the state in which the property is located.
205.13    (g) Receipts from the lease or rental of tangible personal property, including finance
205.14leases and true leases, must be attributed to this state if the property is located in this
205.15state and to other states if the property is not located in this state. Receipts from the
205.16lease or rental of moving property including, but not limited to, motor vehicles, rolling
205.17stock, aircraft, vessels, or mobile equipment are included in the numerator of the receipts
205.18factor to the extent that the property is used in this state. The extent of the use of moving
205.19property is determined as follows:
205.20    (1) A motor vehicle is used wholly in the state in which it is registered.
205.21    (2) The extent that rolling stock is used in this state is determined by multiplying
205.22the receipts from the lease or rental of the rolling stock by a fraction, the numerator of
205.23which is the miles traveled within this state by the leased or rented rolling stock and the
205.24denominator of which is the total miles traveled by the leased or rented rolling stock.
205.25    (3) The extent that an aircraft is used in this state is determined by multiplying the
205.26receipts from the lease or rental of the aircraft by a fraction, the numerator of which is
205.27the number of landings of the aircraft in this state and the denominator of which is the
205.28total number of landings of the aircraft.
205.29    (4) The extent that a vessel, mobile equipment, or other mobile property is used in
205.30the state is determined by multiplying the receipts from the lease or rental of the property
205.31by a fraction, the numerator of which is the number of days during the taxable year the
205.32property was in this state and the denominator of which is the total days in the taxable year.
205.33    (h) Royalties and other income received for the use of or for the privilege of using
205.34intangible property, including patents, know-how, formulas, designs, processes, patterns,
205.35copyrights, trade names, service names, franchises, licenses, contracts, customer lists, or
205.36similar items, must be attributed to the state in which the property is used by the purchaser.
206.1If the property is used in more than one state, the royalties or other income must be
206.2apportioned to this state pro rata according to the portion of use in this state. If the portion
206.3of use in this state cannot be determined, the royalties or other income must be excluded
206.4from both the numerator and the denominator. Intangible property is used in this state if
206.5the purchaser uses the intangible property or the rights therein in the regular course of its
206.6business operations in this state, regardless of the location of the purchaser's customers.
206.7    (i) Sales of intangible property are made within the state in which the property is
206.8used by the purchaser. If the property is used in more than one state, the sales must be
206.9apportioned to this state pro rata according to the portion of use in this state. If the
206.10portion of use in this state cannot be determined, the sale must be excluded from both the
206.11numerator and the denominator of the sales factor. Intangible property is used in this
206.12state if the purchaser used the intangible property in the regular course of its business
206.13operations in this state.
206.14    (j) Receipts from the performance of services must be attributed to the state where
206.15the services are received. For the purposes of this section, receipts from the performance
206.16of services provided to a corporation, partnership, or trust may only be attributed to a state
206.17where it has a fixed place of doing business. If the state where the services are received is
206.18not readily determinable or is a state where the corporation, partnership, or trust receiving
206.19the service does not have a fixed place of doing business, the services shall be deemed
206.20to be received at the location of the office of the customer from which the services were
206.21ordered in the regular course of the customer's trade or business. If the ordering office
206.22cannot be determined, the services shall be deemed to be received at the office of the
206.23customer to which the services are billed.
206.24    (k) For the purposes of this subdivision and subdivision 6, paragraph (l), receipts
206.25from management, distribution, or administrative services performed by a corporation
206.26or trust for a fund of a corporation or trust regulated under United States Code, title 15,
206.27sections 80a-1 through 80a-64, must be attributed to the state where the shareholder of
206.28the fund resides. Under this paragraph, receipts for services attributed to shareholders are
206.29determined on the basis of the ratio of: (1) the average of the outstanding shares in the
206.30fund owned by shareholders residing within Minnesota at the beginning and end of each
206.31year; and (2) the average of the total number of outstanding shares in the fund at the
206.32beginning and end of each year. Residence of the shareholder, in the case of an individual,
206.33is determined by the mailing address furnished by the shareholder to the fund. Residence
206.34of the shareholder, when the shares are held by an insurance company as a depositor for
206.35the insurance company policyholders, is the mailing address of the policyholders. In
206.36the case of an insurance company holding the shares as a depositor for the insurance
207.1company policyholders, if the mailing address of the policyholders cannot be determined
207.2by the taxpayer, the receipts must be excluded from both the numerator and denominator.
207.3Residence of other shareholders is the mailing address of the shareholder.
207.4EFFECTIVE DATE.This section is effective the day following final enactment.

207.5    Sec. 5. Minnesota Statutes 2012, section 296A.01, subdivision 16, is amended to read:
207.6    Subd. 16. Dyed fuel. "Dyed fuel" means diesel motor fuel to which indelible dye
207.7has been added, either before or upon withdrawal at a terminal or refinery rack, and which
207.8may be sold for exempt purposes. The dye may be either dye required to be added per the
207.9EPA or dye that meets other specifications required by the Internal Revenue Service or
207.10the commissioner.
207.11EFFECTIVE DATE.This section is effective the day following final enactment.

207.12    Sec. 6. Minnesota Statutes 2013 Supplement, section 403.162, subdivision 5, is
207.13amended to read:
207.14    Subd. 5. Fees deposited. (a) The commissioner of revenue shall, based on
207.15the relative proportion of the prepaid wireless E911 fee and the prepaid wireless
207.16telecommunications access Minnesota fee imposed per retail transaction, divide the fees
207.17collected in corresponding proportions. Within 30 days of receipt of the collected fees,
207.18the commissioner shall:
207.19(1) deposit the proportion of the collected fees attributable to the prepaid wireless
207.20E911 fee in the 911 emergency telecommunications service account in the special revenue
207.21fund; and
207.22(2) deposit the proportion of collected fees attributable to the prepaid wireless
207.23telecommunications access Minnesota fee in the telecommunications access fund
207.24established in section 237.52, subdivision 1.
207.25(b) The department commissioner of revenue may deduct and retain deposit in a
207.26special revenue account an amount, not to exceed two percent of collected fees,. Money
207.27in the account is annually appropriated to the commissioner of revenue to reimburse its
207.28direct costs of administering the collection and remittance of prepaid wireless E911 fees
207.29and prepaid wireless telecommunications access Minnesota fees.
207.30EFFECTIVE DATE.This section is effective retroactively from January 1, 2014.

207.31    Sec. 7. Laws 2013, chapter 143, article 8, section 3, the effective date, is amended to
207.32read:
208.1EFFECTIVE DATE.This section is effective for sales and purchases made after
208.2June 30, 2013, except for paragraph (p), which is effective the day following final
208.3enactment.
208.4EFFECTIVE DATE.This section is effective retroactively from the day following
208.5final enactment of Laws 2013, chapter 143, article 8, section 3.

208.6    Sec. 8. REPEALER.
208.7Minnesota Rules, parts 8130.8900, subpart 3; and 8130.9500, subparts 1, 1a, 2,
208.83, 4, and 5, are repealed.
208.9EFFECTIVE DATE.This section is effective the day following final enactment.
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