Bill Text: MN SF681 | 2011-2012 | 87th Legislature | Introduced
Bill Title: Nonferrous minerals occupation tax rate and computation modifications; distribution of net proceeds and taconite production taxes modifications
Sponsorship: Slight Partisan Bill (Independent 2-1)
Status: (Introduced - Dead) 2011-03-09 - Referred to Taxes [SF681 Detail]
Download: Minnesota-2011-SF681-Introduced.html
1.2relating to taxation; minerals; modifying the rates of taxation of nonferrous
1.3minerals; modifying the distribution of the net proceed and taconite production
1.4taxes;amending Minnesota Statutes 2010, sections 298.01, subdivision 3;
1.5298.015, subdivision 1; 298.018, subdivision 1; 298.28, subdivisions 3, 11.
1.6BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.7 Section 1. Minnesota Statutes 2010, section 298.01, subdivision 3, is amended to read:
1.8 Subd. 3. Occupation tax; other ores. Every person engaged in the business of
1.9mining or producing ores in this state, except iron ore or taconite concentrates, shall pay
1.10an occupation tax to the state of Minnesota as provided in this subdivision. The tax is
1.11determined in the same manner as the tax imposed by section290.02 , except that sections
1.12290.05, subdivision 1
, clause (a),
290.17, subdivision 4 , and
290.191, subdivision 2 , do
1.13not apply, and the occupation tax must be computed by applying to taxable income the rate
1.14of2.45 1.1 percent. A person subject to occupation tax under this section shall apportion
1.15its net income on the basis of the percentage obtained by taking the sum of:
1.16(1) 75 percent of the percentage which the sales made within this state in connection
1.17with the trade or business during the tax period are of the total sales wherever made in
1.18connection with the trade or business during the tax period;
1.19(2) 12.5 percent of the percentage which the total tangible property used by the
1.20taxpayer in this state in connection with the trade or business during the tax period is of
1.21the total tangible property, wherever located, used by the taxpayer in connection with the
1.22trade or business during the tax period; and
1.23(3) 12.5 percent of the percentage which the taxpayer's total payrolls paid or incurred
1.24in this state or paid in respect to labor performed in this state in connection with the trade
2.1or business during the tax period are of the taxpayer's total payrolls paid or incurred in
2.2connection with the trade or business during the tax period.
2.3The tax is in addition to all other taxes.
2.4 Sec. 2. Minnesota Statutes 2010, section 298.015, subdivision 1, is amended to read:
2.5 Subdivision 1. Tax imposed. A person engaged in the business of mining shall pay
2.6to the state of Minnesota for distribution as provided in section298.018 a net proceeds tax
2.7equal totwo 3.35 percent of the net proceeds from mining in Minnesota. The tax applies
2.8to all mineral and energy resources mined or extracted within the state of Minnesota
2.9except for sand, silica sand, gravel, building stone, crushed rock, limestone, granite,
2.10dimension granite, dimension stone, horticultural peat, clay, soil, iron ore, and taconite
2.11concentrates. The tax is in addition to all other taxes provided for by law.
2.12 Sec. 3. Minnesota Statutes 2010, section 298.018, subdivision 1, is amended to read:
2.13 Subdivision 1. Within taconite assistance area. The proceeds of the tax paid under
2.14sections298.015 to
298.017 on minerals and energy resources mined or extracted within
2.15the taconite assistance area defined in section273.1341 , shall be allocated as follows:
2.16(1) five percent to the city or town within which the minerals or energy resources
2.17are mined or extracted or within which the concentrate was produced. If the mining
2.18and concentration, or different steps in either process, are carried on in more than one
2.19taxing district, the commissioner shall apportion equitably the proceeds of the part of the
2.20tax going to cities and towns among them upon the basis of attributing 50 percent of
2.21the proceeds of the tax to the operation of mining or extraction, and the remainder to
2.22the concentrating plant and to the processes of concentration, and with respect to each
2.23thereof giving due consideration to the relative extent of such operations performed in
2.24each taxing district. The commissioner's order making the apportionment is subject to
2.25review by the Tax Court at the request of any of the taxing districts, in the same manner as
2.26other orders of the commissioner;
2.27(2) ten percent to the taconite municipal aid account to be distributed as provided
2.28in section298.282 ;
2.29(3) ten percent to the school district within which the minerals or energy resources
2.30are mined or extracted or within which the concentrate was produced. If the mining
2.31and concentration, or different steps in either process, are carried on in more than one
2.32school district, distribution among the school districts must be based on the apportionment
2.33formula prescribed in clause (1);
3.1(4) 20 percent to a group of school districts comprised of those school districts
3.2wherein the mineral or energy resource was mined or extracted or in which there is a
3.3qualifying municipality as defined by section273.134, paragraph (b) , in direct proportion
3.4to school district indexes as follows: for each school district, its pupil units determined
3.5under section126C.05 for the prior school year shall be multiplied by the ratio of the
3.6average adjusted net tax capacity per pupil unit for school districts receiving aid under
3.7this clause as calculated pursuant to chapters 122A, 126C, and 127A for the school year
3.8ending prior to distribution to the adjusted net tax capacity per pupil unit of the district.
3.9Each district shall receive that portion of the distribution which its index bears to the sum
3.10of the indices for all school districts that receive the distributions;
3.11(5) 20 percent to the county within which the minerals or energy resources are mined
3.12or extracted, provided that the county shall pay one percent of its proceeds to the Range
3.13Association of Municipalities and Schools;
3.14(6) 20 percent to St. Louis County acting as the counties' fiscal agent to be
3.15distributed as provided in sections273.134 to
273.136 ;
3.16(7) five percent to the Iron Range Resources and Rehabilitation Board for the
3.17purposes of section298.22 ;
3.18(8)five three percent to the Douglas J. Johnson economic protection trust fund; and
3.19(9)five seven percent to the taconite environmental protection fund.
3.20The proceeds of the tax shall be distributed on July 15 each year.
3.21 Sec. 4. Minnesota Statutes 2010, section 298.28, subdivision 3, is amended to read:
3.22 Subd. 3. Cities; towns. (a) 12.5 cents per taxable ton, less any amount distributed
3.23under subdivision 8, and paragraph (b), must be allocated to the taconite municipal aid
3.24account to be distributed as provided in section298.282 .
3.25 (b) An amount must be allocated to towns or cities that is annually certified by
3.26the county auditor of a county containing a taconite tax relief area as defined in section
3.27273.134, paragraph (b)
, within which there is (1) an organized township if, as of January
3.282, 1982, more than 75 percent of the assessed valuation of the township consists of iron
3.29ore or (2) a city if, as of January 2, 1980, more than 75 percent of the assessed valuation
3.30of the city consists of iron ore.
3.31 (c) The amount allocated under paragraph (b) will be the portion of a township's or
3.32city's certified levy equal to the proportion of (1) the difference between 50 percent of
3.33January 2, 1982, assessed value in the case of a township and 50 percent of the January 2,
3.341980, assessed value in the case of a city and its current assessed value to (2) the sum of
3.35its current assessed value plus the difference determined in (1), provided that the amount
4.1distributed shall not exceed $55 per capita in the case of a township or $75 per capita in
4.2the case of a city. For purposes of this limitation, population will be determined according
4.3to the 1980 decennial census conducted by the United States Bureau of the Census. If the
4.4current assessed value of the township exceeds 50 percent of the township's January 2,
4.51982, assessed value, or if the current assessed value of the city exceeds 50 percent of the
4.6city's January 2, 1980, assessed value, this paragraph shall not apply. For purposes of this
4.7paragraph, "assessed value," when used in reference to years other than 1980 or 1982,
4.8means the appropriate net tax capacities multiplied by 10.2.
4.9 (d) In addition to other distributions under this subdivision, three cents per taxable
4.10ton for distributions in 2009 must be allocated for distribution to towns that are entirely
4.11located within the taconite tax relief area defined in section273.134 , paragraph (b).
4.12For distribution in 2010 and subsequent years, the three-cent amount must be annually
4.13increased in the same proportion as the increase in the implicit price deflator as provided
4.14in section
298.24, subdivision 1. The amount available under this paragraph will be
4.15distributed to eligible towns on a per capita basis, provided that no town may receive more
4.16than $50,000 in any year under this paragraph. Any amount of the distribution that exceeds
4.17the $50,000 limitation for a town under this paragraph must be redistributed on a per
4.18capita basis among the other eligible towns, to whose distributions do not exceed $50,000.
4.19EFFECTIVE DATE.This section is effective for the 2012 distribution.
4.20 Sec. 5. Minnesota Statutes 2010, section 298.28, subdivision 11, is amended to read:
4.21 Subd. 11. Remainder. (a) The proceeds of the tax imposed by section298.24 which
4.22remain after the distributions and payments in subdivisions 2 to 10a, as certified by the
4.23commissioner of revenue, and paragraphs (b), (c), and (d) have been made, together with
4.24interest earned on all money distributed under this section prior to distribution, shall be
4.25divided between the taconite environmental protection fund created in section298.223
4.26and the Douglas J. Johnson economic protection trust fund created in section298.292 as
4.27follows: Two-thirds to the taconite environmental protection fund and one-third to the
4.28Douglas J. Johnson economic protection trust fund. The proceeds shall be placed in
4.29the respective special accounts.
4.30(b) There shall be distributed to each city, town, and county the amount that it
4.31received under section294.26 in calendar year 1977; provided, however, that the amount
4.32distributed in 1981 to the unorganized territory number 2 of Lake County and the town
4.33of Beaver Bay based on the between-terminal trackage of Erie Mining Company will be
4.34distributed in 1982 and subsequent years to the unorganized territory number 2 of Lake
5.1County and the towns of Beaver Bay and Stony River based on the miles of track of Erie
5.2Mining Company in each taxing district.
5.3(c) There shall be distributed to the Iron Range Resources and Rehabilitation Board
5.4the amounts it received in 1977 under section298.22 . The amount distributed under
5.5this paragraph shall be expended within or for the benefit of the taconite assistance area
5.6defined in section273.1341 .
5.7(d) There shall be distributed to each school district 62 percent of the amount that it
5.8received under section
294.26 in calendar year 1977.
5.9EFFECTIVE DATE.This section is effective for the 2012 distribution.
1.3minerals; modifying the distribution of the net proceed and taconite production
1.4taxes;amending Minnesota Statutes 2010, sections 298.01, subdivision 3;
1.5298.015, subdivision 1; 298.018, subdivision 1; 298.28, subdivisions 3, 11.
1.6BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.7 Section 1. Minnesota Statutes 2010, section 298.01, subdivision 3, is amended to read:
1.8 Subd. 3. Occupation tax; other ores. Every person engaged in the business of
1.9mining or producing ores in this state, except iron ore or taconite concentrates, shall pay
1.10an occupation tax to the state of Minnesota as provided in this subdivision. The tax is
1.11determined in the same manner as the tax imposed by section
1.13not apply, and the occupation tax must be computed by applying to taxable income the rate
1.14of
1.15its net income on the basis of the percentage obtained by taking the sum of:
1.16(1) 75 percent of the percentage which the sales made within this state in connection
1.17with the trade or business during the tax period are of the total sales wherever made in
1.18connection with the trade or business during the tax period;
1.19(2) 12.5 percent of the percentage which the total tangible property used by the
1.20taxpayer in this state in connection with the trade or business during the tax period is of
1.21the total tangible property, wherever located, used by the taxpayer in connection with the
1.22trade or business during the tax period; and
1.23(3) 12.5 percent of the percentage which the taxpayer's total payrolls paid or incurred
1.24in this state or paid in respect to labor performed in this state in connection with the trade
2.1or business during the tax period are of the taxpayer's total payrolls paid or incurred in
2.2connection with the trade or business during the tax period.
2.3The tax is in addition to all other taxes.
2.4 Sec. 2. Minnesota Statutes 2010, section 298.015, subdivision 1, is amended to read:
2.5 Subdivision 1. Tax imposed. A person engaged in the business of mining shall pay
2.6to the state of Minnesota for distribution as provided in section
2.7equal to
2.8to all mineral and energy resources mined or extracted within the state of Minnesota
2.9except for sand, silica sand, gravel, building stone, crushed rock, limestone, granite,
2.10dimension granite, dimension stone, horticultural peat, clay, soil, iron ore, and taconite
2.11concentrates. The tax is in addition to all other taxes provided for by law.
2.12 Sec. 3. Minnesota Statutes 2010, section 298.018, subdivision 1, is amended to read:
2.13 Subdivision 1. Within taconite assistance area. The proceeds of the tax paid under
2.14sections
2.15the taconite assistance area defined in section
2.16(1) five percent to the city or town within which the minerals or energy resources
2.17are mined or extracted or within which the concentrate was produced. If the mining
2.18and concentration, or different steps in either process, are carried on in more than one
2.19taxing district, the commissioner shall apportion equitably the proceeds of the part of the
2.20tax going to cities and towns among them upon the basis of attributing 50 percent of
2.21the proceeds of the tax to the operation of mining or extraction, and the remainder to
2.22the concentrating plant and to the processes of concentration, and with respect to each
2.23thereof giving due consideration to the relative extent of such operations performed in
2.24each taxing district. The commissioner's order making the apportionment is subject to
2.25review by the Tax Court at the request of any of the taxing districts, in the same manner as
2.26other orders of the commissioner;
2.27(2) ten percent to the taconite municipal aid account to be distributed as provided
2.28in section
2.29(3) ten percent to the school district within which the minerals or energy resources
2.30are mined or extracted or within which the concentrate was produced. If the mining
2.31and concentration, or different steps in either process, are carried on in more than one
2.32school district, distribution among the school districts must be based on the apportionment
2.33formula prescribed in clause (1);
3.1(4) 20 percent to a group of school districts comprised of those school districts
3.2wherein the mineral or energy resource was mined or extracted or in which there is a
3.3qualifying municipality as defined by section
3.4to school district indexes as follows: for each school district, its pupil units determined
3.5under section
3.6average adjusted net tax capacity per pupil unit for school districts receiving aid under
3.7this clause as calculated pursuant to chapters 122A, 126C, and 127A for the school year
3.8ending prior to distribution to the adjusted net tax capacity per pupil unit of the district.
3.9Each district shall receive that portion of the distribution which its index bears to the sum
3.10of the indices for all school districts that receive the distributions;
3.11(5) 20 percent to the county within which the minerals or energy resources are mined
3.12or extracted, provided that the county shall pay one percent of its proceeds to the Range
3.13Association of Municipalities and Schools;
3.14(6) 20 percent to St. Louis County acting as the counties' fiscal agent to be
3.15distributed as provided in sections
3.16(7) five percent to the Iron Range Resources and Rehabilitation Board for the
3.17purposes of section
3.18(8)
3.19(9)
3.20The proceeds of the tax shall be distributed on July 15 each year.
3.21 Sec. 4. Minnesota Statutes 2010, section 298.28, subdivision 3, is amended to read:
3.22 Subd. 3. Cities; towns. (a) 12.5 cents per taxable ton, less any amount distributed
3.23under subdivision 8, and paragraph (b), must be allocated to the taconite municipal aid
3.24account to be distributed as provided in section
3.25 (b) An amount must be allocated to towns or cities that is annually certified by
3.26the county auditor of a county containing a taconite tax relief area as defined in section
3.282, 1982, more than 75 percent of the assessed valuation of the township consists of iron
3.29ore or (2) a city if, as of January 2, 1980, more than 75 percent of the assessed valuation
3.30of the city consists of iron ore.
3.31 (c) The amount allocated under paragraph (b) will be the portion of a township's or
3.32city's certified levy equal to the proportion of (1) the difference between 50 percent of
3.33January 2, 1982, assessed value in the case of a township and 50 percent of the January 2,
3.341980, assessed value in the case of a city and its current assessed value to (2) the sum of
3.35its current assessed value plus the difference determined in (1), provided that the amount
4.1distributed shall not exceed $55 per capita in the case of a township or $75 per capita in
4.2the case of a city. For purposes of this limitation, population will be determined according
4.3to the 1980 decennial census conducted by the United States Bureau of the Census. If the
4.4current assessed value of the township exceeds 50 percent of the township's January 2,
4.51982, assessed value, or if the current assessed value of the city exceeds 50 percent of the
4.6city's January 2, 1980, assessed value, this paragraph shall not apply. For purposes of this
4.7paragraph, "assessed value," when used in reference to years other than 1980 or 1982,
4.8means the appropriate net tax capacities multiplied by 10.2.
4.9 (d) In addition to other distributions under this subdivision, three cents per taxable
4.10ton for distributions in 2009 must be allocated for distribution to towns that are entirely
4.11located within the taconite tax relief area defined in section
4.12
4.13
4.14
4.15distributed to eligible towns on a per capita basis, provided that no town may receive more
4.16than $50,000 in any year under this paragraph. Any amount of the distribution that exceeds
4.17the $50,000 limitation for a town under this paragraph must be redistributed on a per
4.18capita basis among the other eligible towns, to whose distributions do not exceed $50,000.
4.19EFFECTIVE DATE.This section is effective for the 2012 distribution.
4.20 Sec. 5. Minnesota Statutes 2010, section 298.28, subdivision 11, is amended to read:
4.21 Subd. 11. Remainder. (a) The proceeds of the tax imposed by section
4.22remain after the distributions and payments in subdivisions 2 to 10a, as certified by the
4.23commissioner of revenue, and paragraphs (b), (c), and (d) have been made, together with
4.24interest earned on all money distributed under this section prior to distribution, shall be
4.25divided between the taconite environmental protection fund created in section
4.26and the Douglas J. Johnson economic protection trust fund created in section
4.27follows: Two-thirds to the taconite environmental protection fund and one-third to the
4.28Douglas J. Johnson economic protection trust fund. The proceeds shall be placed in
4.29the respective special accounts.
4.30(b) There shall be distributed to each city, town, and county the amount that it
4.31received under section
4.32distributed in 1981 to the unorganized territory number 2 of Lake County and the town
4.33of Beaver Bay based on the between-terminal trackage of Erie Mining Company will be
4.34distributed in 1982 and subsequent years to the unorganized territory number 2 of Lake
5.1County and the towns of Beaver Bay and Stony River based on the miles of track of Erie
5.2Mining Company in each taxing district.
5.3(c) There shall be distributed to the Iron Range Resources and Rehabilitation Board
5.4the amounts it received in 1977 under section
5.5this paragraph shall be expended within or for the benefit of the taconite assistance area
5.6defined in section
5.7
5.8
5.9EFFECTIVE DATE.This section is effective for the 2012 distribution.
