The Honorable Joan Anderson Growe
Secretary of State

The State of Minnesota

Dear Ms. Growe:

It is my honor to inform you that I have allowed Resolution No. 5, H. F. No. 2417, to be filed without my signature:

H. F. No. 2417, memorializing Congress to support the admission of Poland, the Czech Republic, and the Republic of Hungary to the North Atlantic Treaty Organization.

Warmest regards,

Arne H. Carlson

Governor

Speaker of the House of Representatives

The Honorable Allan H. Spear

President of the Senate

I have the honor to inform you that the following enrolled Act of the 1998 Session of the State Legislature has been received from the Office of the Governor and is deposited in the Office of the Secretary of State for preservation, pursuant to the State Constitution, Article IV, Section 23:

S.F. No.	H.F. No.	Session Laws Chapter No.	Time and Date Approved 1997	Date Filed 1997
	2417	Resolution No. 5	March 4

Sincerely,

Joan Anderson Growe
Secretary of State

The Honorable Phil Carruthers

Speaker of the House of Representatives

The State of Minnesota

Dear Speaker Carruthers:

It is my honor to inform you that I have received, approved, signed and deposited in the Office of the Secretary of State the following House File:

H. F. No. 3095, relating to veterans; designating a date in February as Chaplains Day in honor of four United States army chaplains who sacrificed their lives at sea for other service members.

Warmest regards,

Arne H. Carlson

Governor

Speaker of the House of Representatives

The Honorable Allan H. Spear

President of the Senate

I have the honor to inform you that the following enrolled Acts of the 1998 Session of the State Legislature have been received from the Office of the Governor and are deposited in the Office of the Secretary of State for preservation, pursuant to the State Constitution, Article IV, Section 23:

S.F. No.	H.F. No.	Session Laws Chapter No.	Time and Date Approved 1997	Date Filed 1997
2354		271	11:10 a.m. March 6	March 6
	3095	272	11:12 a.m. March 6	March 6

Sincerely,

Joan Anderson Growe
Secretary of State

Speaker of the House of Representatives

The Honorable Allan H. Spear

President of the Senate

I have the honor to inform you that the following enrolled Act of the 1998 Session of the State Legislature has been received from the Office of the Governor and is deposited in the Office of the Secretary of State for preservation, pursuant to the State Constitution, Article IV, Section 23:

S.F. No.	H.F. No.	Session Laws Chapter No.	Time and Date Approved 1997	Date Filed 1997
2477		273	11:20 a.m. March 9	March 9

Sincerely,

Joan Anderson Growe
Secretary of State

Orfield; Rukavina; Garcia; Anderson, I.; Osthoff; Munger; Mullery; Farrell; Jefferson; Greiling; Paymar; Kahn; Biernat; Skoglund; Leighton; Wenzel; Jaros; Mahon; Tomassoni and Carlson moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Pages 7 to 10, delete sections 2 through 9

Page 11, line 4, delete "1.8" and insert "1.75"

Page 11, line 5, delete "1.75 percent for taxes payable in 2000,"

Page 11, line 6, delete "2001" and insert "2000"

Pages 14 to 19, delete sections 11 and 12

Page 20, line 12, delete "2.6" and insert "2.65"

Page 20, line 13, delete "2.5" and insert "2.6"

Page 20, lines 28 to 31, restore the stricken language and delete the new language

Pages 21 and 24, restore the stricken language and delete the new language

Page 25, lines 14 to 16, restore the stricken language and delete the new language

Page 26, delete section 15

Page 26, line 28, delete "50" and insert "47"

Page 26, line 29, delete "64" and insert "57"

Page 26, line 30, delete "75" and insert "65"

Page 26, line 34, delete "$265" and insert "$255" and delete "$325" and insert "$285"

Page 26, line 35, delete "$360" and insert "$315"

Page 27, delete section 18

Pages 31 to 33, delete sections 23 and 24, and insert:

"Sec. 11. [PAYABLE 1999 AND 2000 PROPERTY TAX CREDIT.]

Subdivision 1. [ELIGIBILITY; PERCENTAGE.] For taxes payable in 1999 and 2000, each owner of the following classes of property shall be eligible for a credit equal to the percent shown of gross property taxes payable:

Class Payable

1999

Credit

Percentage

4bb Single unit nonhomestead residential 10.4

4b Other residential nonhomestead 4.0

4c Seasonal recreational residential 2.7

3a Commercial-industrial public utility first tier 2.2

3a Commercial-industrial public utility upper tier 3.1

2a Ag homestead 3.3

Class Payable

2000

Credit

Percentage

4bb Single unit nonhomestead residential 15.6

4b Other residential nonhomestead 6.0

4c Seasonal recreational residential 4.0

3a Commercial-industrial public utility first tier 3.3

3a Commercial-industrial public utility upper tier 4.6

2a Ag homestead 5.0

2b Ag nonhomestead and timberland 3.5

The credit for class 2a shall not apply to the portion of property consisting of the house, garage and one acre of land.

Subd. 2. [APPLICATION.] The county auditor shall reduce the property's gross tax by the amount of the credit. The total amount credited by each county shall be reported to the commissioner of revenue by June 1 of the year in which the taxes are payable, in a form prescribed by the commissioner. The commissioner shall pay the counties the total credit amount on October 1 of the year in which taxes are payable. The county auditor shall reimburse local taxing jurisdictions in amounts equal to the amount of property taxes reduced by the credit.

Subd. 3. [APPROPRIATION.] An amount sufficient to pay the credit authorized under this section is appropriated to the commissioner of revenue from the property tax reform account in fiscal years 2000 and 2001."

Page 33, delete lines 6 to 15

Page 33, line 16, delete "Subd. 2. [PROPERTY TAX REFUND.]"

Page 33, delete lines 20 to 24

Renumber the sections in sequence and correct internal references

Amend the title accordingly

A roll call was requested and properly seconded.

The question was taken on the Orfield et al amendment and the roll was called.

Winter moved that those not voting be excused from voting. The motion prevailed.

There were 48 yeas and 82 nays as follows:

Those who voted in the affirmative were:

Anderson, I.	Delmont	Hausman	Mahon	Olson, M.	Sekhon
Bakk	Entenza	Hilty	Mariani	Orfield	Skare
Biernat	Erickson	Jaros	Marko	Osskopp	Skoglund
Carlson	Evans	Jefferson	McCollum	Osthoff	Tomassoni
Chaudhary	Farrell	Kahn	McGuire	Otremba, M.	Trimble
Clark, K.	Garcia	Koskinen	Mullery	Paymar	Tuma
Dawkins	Greenfield	Leighton	Munger	Pugh	Wejcman
Dehler	Greiling	Lieder	Murphy	Rukavina	Westfall

Those who voted in the negative were:

Abrams	Finseth	Kelso	McElroy	Rhodes	Tingelstad
Anderson, B.	Folliard	Kielkucki	Milbert	Rifenberg	Tompkins
Bettermann	Goodno	Kinkel	Molnau	Rostberg	Tunheim
Bishop	Gunther	Knight	Mulder	Schumacher	Van Dellen
Boudreau	Haas	Knoblach	Ness	Seagren	Vandeveer
Bradley	Harder	Kraus	Nornes	Seifert	Weaver
Broecker	Hasskamp	Krinkie	Olson, E.	Slawik	Wenzel
Clark, J.	Holsten	Kubly	Opatz	Smith	Westrom
Commers	Huntley	Kuisle	Ozment	Solberg	Winter
Daggett	Jennings	Larsen	Paulsen	Stanek	Wolf
Davids	Johnson, A.	Leppik	Pawlenty	Stang	Workman
Dempsey	Johnson, R.	Lindner	Pelowski	Sviggum	Spk. Carruthers
Dorn	Juhnke	Macklin	Rest	Swenson, H.
Erhardt	Kalis	Mares	Reuter	Sykora

The motion did not prevail and the amendment was not adopted.

Abrams, Macklin, Opatz, Kelso, Rest and Rhodes moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Pages 6 to 33, delete article 2 and insert:

Section 1. Minnesota Statutes 1997 Supplement, section 124.315, subdivision 4, is amended to read:

Subd. 4. [INTEGRATION LEVY.] A district may levy an amount equal to 46 28 percent of the district's integration revenue as defined in subdivision 3.

Sec. 2. Minnesota Statutes 1997 Supplement, section 124.315, subdivision 5, is amended to read:

Subd. 5. [INTEGRATION AID.] A district's integration aid equals 54 72 percent of the district's integration revenue as defined in subdivision 3.

Sec. 3. Minnesota Statutes 1997 Supplement, section 273.127, subdivision 3, is amended to read:

Subd. 3. [CLASS 4C PROPERTIES.] For the market value of properties that meet the criteria of subdivision 2, paragraph (a), and which no longer qualify as a result of the eligibility criteria specified in section 273.126, a class rate of 2.4 percent applies for taxes payable in 1999 and a class rate of 2.6 2.5 percent applies for taxes payable in 2000.

Sec. 4. Minnesota Statutes 1997 Supplement, section 273.13, subdivision 22, is amended to read:

Subd. 22. [CLASS 1.] (a) Except as provided in subdivision 23, real estate which is residential and used for homestead purposes is class 1. The market value of class 1a property must be determined based upon the value of the house, garage, and land.

(b) Class 1b property includes homestead real estate or homestead manufactured homes used for the purposes of a homestead by

(1) any blind person, or the blind person and the blind person's spouse; or

(2) any person, hereinafter referred to as "veteran," who:

(i) served in the active military or naval service of the United States; and

(ii) is entitled to compensation under the laws and regulations of the United States for permanent and total service-connected disability due to the loss, or loss of use, by reason of amputation, ankylosis, progressive muscular dystrophies, or paralysis, of both lower extremities, such as to preclude motion without the aid of braces, crutches, canes, or a wheelchair; and

(iii) has acquired a special housing unit with special fixtures or movable facilities made necessary by the nature of the veteran's disability, or the surviving spouse of the deceased veteran for as long as the surviving spouse retains the special housing unit as a homestead; or

(3) any person who:

(i) is permanently and totally disabled and

(ii) receives 90 percent or more of total income from

(A) aid from any state as a result of that disability; or

(B) supplemental security income for the disabled; or

(C) workers' compensation based on a finding of total and permanent disability; or

(D) social security disability, including the amount of a disability insurance benefit which is converted to an old age insurance benefit and any subsequent cost of living increases; or

(E) aid under the federal Railroad Retirement Act of 1937, United States Code Annotated, title 45, section 228b(a)5; or

(F) a pension from any local government retirement fund located in the state of Minnesota as a result of that disability; or

(G) pension, annuity, or other income paid as a result of that disability from a private pension or disability plan, including employer, employee, union, and insurance plans and

(iii) has household income as defined in section 290A.03, subdivision 5, of $50,000 or less; or

(4) any person who is permanently and totally disabled and whose household income as defined in section 290A.03, subdivision 5, is 275 percent or less of the federal poverty level.

Property is classified and assessed under clause (4) only if the government agency or income-providing source certifies, upon the request of the homestead occupant, that the homestead occupant satisfies the disability requirements of this paragraph.

Permanently and totally disabled for the purpose of this subdivision means a condition which is permanent in nature and totally incapacitates the person from working at an occupation which brings the person an income. The first $32,000 market value of class 1b property has a net class rate of .45 percent of its market value. The remaining market value of class 1b property has a net class rate using the rates for class 1 or class 2a property, whichever is appropriate, of similar market value.

(c) Class 1c property is commercial use real property that abuts a lakeshore line and is devoted to temporary and seasonal residential occupancy for recreational purposes but not devoted to commercial purposes for more than 250 days in the year preceding the year of assessment, and that includes a portion used as a homestead by the owner, which includes a dwelling occupied as a homestead by a shareholder of a corporation that owns the resort or a partner in a partnership that owns the resort, even if the title to the homestead is held by the corporation or partnership. For purposes of this clause, property is devoted to a commercial purpose on a specific day if any portion of the property, excluding the portion used exclusively as a homestead, is used for residential occupancy and a fee is charged for residential occupancy. In order for a property to be classified as class 1c, at least 40 percent of the annual gross lodging receipts related to the property must be from business conducted between Memorial Day weekend and Labor Day weekend, and at least 60 percent of all bookings by lodging guests during the year must be for periods of at least two consecutive nights. Class 1c property has a class rate of one percent of total market value with the following limitation: the area of the property must not exceed 100 feet of lakeshore footage for each cabin or campsite located on the property up to a total of 800 feet and 500 feet in depth, measured away from the lakeshore.

(d) Class 1d property includes structures that meet all of the following criteria:

(1) the structure is located on property that is classified as agricultural property under section 273.13, subdivision 23;

(2) the structure is occupied exclusively by seasonal farm workers during the time when they work on that farm, and the occupants are not charged rent for the privilege of occupying the property, provided that use of the structure for storage of farm equipment and produce does not disqualify the property from classification under this paragraph;

(3) the structure meets all applicable health and safety requirements for the appropriate season; and

(4) the structure is not saleable as residential property because it does not comply with local ordinances relating to location in relation to streets or roads.

The market value of class 1d property has the same class rates as class 1a property under paragraph (a).

Sec. 5. Minnesota Statutes 1997 Supplement, section 273.13, subdivision 23, is amended to read:

Subd. 23. [CLASS 2.] (a) Class 2a property is agricultural land including any improvements that is homesteaded. The market value of the house and garage and immediately surrounding one acre of land has the same class rates as class 1a property under subdivision 22. The value of the remaining land including improvements up to $115,000 has a net class rate of 0.4 0.35 percent of market value. The remaining value of class 2a property over $115,000 of market value that does not exceed 320 acres has a net class rate of 0.9 0.8 percent of market value. The remaining property over the $115,000 market value in excess of 320 acres has a class rate of 1.4 1.3 percent of market value.

(b) Class 2b property is (1) real estate, rural in character and used exclusively for growing trees for timber, lumber, and wood and wood products; (2) real estate that is not improved with a structure and is used exclusively for growing trees for timber, lumber, and wood and wood products, if the owner has participated or is participating in a cost-sharing program for afforestation, reforestation, or timber stand improvement on that particular property, administered or coordinated by the commissioner of natural resources; (3) real estate that is nonhomestead agricultural land; or (4) a landing area or public access area of a privately owned public use airport. Class 2b property has a net class rate of 1.4 1.3 percent of market value.

only if it is pasture, timber, waste, unusable wild land, or land included in state or federal farm programs. Agricultural classification for property shall be determined excluding the house, garage, and immediately surrounding one acre of land, and shall not be based upon the market value of any residential structures on the parcel or contiguous parcels under the same ownership.

(d) Real estate, excluding the house, garage, and immediately surrounding one acre of land, of less than ten acres which is exclusively and intensively used for raising or cultivating agricultural products, shall be considered as agricultural land.

Land shall be classified as agricultural even if all or a portion of the agricultural use of that property is the leasing to, or use by another person for agricultural purposes.

Classification under this subdivision is not determinative for qualifying under section 273.111.

The property classification under this section supersedes, for property tax purposes only, any locally administered agricultural policies or land use restrictions that define minimum or maximum farm acreage.

(e) The term "agricultural products" as used in this subdivision includes production for sale of:

(1) livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing animals, horticultural and nursery stock described in sections 18.44 to 18.61, fruit of all kinds, vegetables, forage, grains, bees, and apiary products by the owner;

(2) fish bred for sale and consumption if the fish breeding occurs on land zoned for agricultural use;

(3) the commercial boarding of horses if the boarding is done in conjunction with raising or cultivating agricultural products as defined in clause (1);

(4) property which is owned and operated by nonprofit organizations used for equestrian activities, excluding racing; and

(5) game birds and waterfowl bred and raised for use on a shooting preserve licensed under section 97A.115.

(f) If a parcel used for agricultural purposes is also used for commercial or industrial purposes, including but not limited to:

(1) wholesale and retail sales;

(2) processing of raw agricultural products or other goods;

(3) warehousing or storage of processed goods; and

(4) office facilities for the support of the activities enumerated in clauses (1), (2), and (3),

the assessor shall classify the part of the parcel used for agricultural purposes as class 1b, 2a, or 2b, whichever is appropriate, and the remainder in the class appropriate to its use. The grading, sorting, and packaging of raw agricultural products for first sale is considered an agricultural purpose. A greenhouse or other building where horticultural or nursery products are grown that is also used for the conduct of retail sales must be classified as agricultural if it is primarily used for the growing of horticultural or nursery products from seed, cuttings, or roots and occasionally as a showroom for the retail sale of those products. Use of a greenhouse or building only for the display of already grown horticultural or nursery products does not qualify as an agricultural purpose.

(g) To qualify for classification under paragraph (b), clause (4), a privately owned public use airport must be licensed as a public airport under section 360.018. For purposes of paragraph (b), clause (4), "landing area" means that part of a privately owned public use airport properly cleared, regularly maintained, and made available to the public for use by aircraft and includes runways, taxiways, aprons, and sites upon which are situated landing or navigational aids. A landing area also includes land underlying both the primary surface and the approach surfaces that comply with all of the following:

(i) the land is properly cleared and regularly maintained for the primary purposes of the landing, taking off, and taxiing of aircraft; but that portion of the land that contains facilities for servicing, repair, or maintenance of aircraft is not included as a landing area;

(ii) the land is part of the airport property; and

(iii) the land is not used for commercial or residential purposes.

The land contained in a landing area under paragraph (b), clause (4), must be described and certified by the commissioner of transportation. The certification is effective until it is modified, or until the airport or landing area no longer meets the requirements of paragraph (b), clause (4). For purposes of paragraph (b), clause (4), "public access area" means property used as an aircraft parking ramp, apron, or storage hangar, or an arrival and departure building in connection with the airport.

Sec. 6. Minnesota Statutes 1997 Supplement, section 273.13, subdivision 24, is amended to read:

Subd. 24. [CLASS 3.] (a) Commercial and industrial property and utility real and personal property, except class 5 property as identified in subdivision 31, clause (1), is class 3a. Each parcel has a class rate of 2.7 2.5 percent of the first tier of market value, and 4.0 3.5 percent of the remaining market value, except that in the case of contiguous parcels of commercial and industrial property owned by the same person or entity, only the value equal to the first-tier value of the contiguous parcels qualifies for the reduced class rate. For the purposes of this subdivision, the first tier means the first $150,000 of market value. In the case of utility property owned by one person or entity, only one parcel in each county has a reduced class rate on the first tier of market value.

For purposes of this paragraph, parcels are considered to be contiguous even if they are separated from each other by a road, street, vacant lot, waterway, or other similar intervening type of property.

(b) Employment property defined in section 469.166, during the period provided in section 469.170, shall constitute class 3b and has a class rate of 2.3 percent of the first $50,000 of market value and 3.6 3.5 percent of the remainder, except that for employment property located in a border city enterprise zone designated pursuant to section 469.168, subdivision 4, paragraph (c), the class rate of the first tier of market value and the class rate of the remainder is determined under paragraph (a), unless the governing body of the city designated as an enterprise zone determines that a specific parcel shall be assessed pursuant to the first clause of this sentence. The governing body may provide for assessment under the first clause of the preceding sentence only for property which is located in an area which has been designated by the governing body for the receipt of tax reductions authorized by section 469.171, subdivision 1.

Sec. 7. Minnesota Statutes 1997 Supplement, section 273.13, subdivision 25, as amended by Laws 1997, Third Special Session chapter 3, section 28, is amended to read:

Subd. 25. [CLASS 4.] (a) Class 4a is residential real estate containing four or more units and used or held for use by the owner or by the tenants or lessees of the owner as a residence for rental periods of 30 days or more. Class 4a also includes hospitals licensed under sections 144.50 to 144.56, other than hospitals exempt under section 272.02, and contiguous property used for hospital purposes, without regard to whether the property has been platted or subdivided. Class 4a property in a city with a population of 5,000 or less, that is (1) located outside of the metropolitan area, as defined in section 473.121, subdivision 2, or outside any county contiguous to the metropolitan area, and (2) whose city boundary is at least 15 miles from the boundary of any city with a population greater than 5,000 has a class rate of 2.3 2.15 percent of market value. All other class 4a property has a class rate of 2.9 2.5 percent of market value. For purposes of this paragraph, population has the same meaning given in section 477A.011, subdivision 3.

(b) Class 4b includes:

(1) residential real estate containing less than four units that does not qualify as class 4bb, other than seasonal residential, and recreational;

(2) manufactured homes not classified under any other provision;

(3) a dwelling, garage, and surrounding one acre of property on a nonhomestead farm classified under subdivision 23, paragraph (b) containing two or three units;

(4) unimproved property that is classified residential as determined under section 273.13, subdivision 33.

Class 4b property has a class rate of 2.1 1.7 percent of market value.

(c) Class 4bb includes:

(1) nonhomestead residential real estate containing one unit, other than seasonal residential, and recreational; and

(2) a single family dwelling, garage, and surrounding one acre of property on a nonhomestead farm classified under subdivision 23, paragraph (b).

Class 4bb has a class rate of 1.9 1.25 percent on the first $75,000 of market value and a class rate of 2.1 1.7 percent of its market value that exceeds $75,000.

Property that has been classified as seasonal recreational residential property at any time during which it has been owned by the current owner or spouse of the current owner does not qualify for class 4bb.

(d) Class 4c property includes:

temporary and seasonal residential occupancy for recreation purposes and all or a portion of which was devoted to commercial purposes for not more than 250 days in the year preceding the year of assessment desiring classification as class 1c or 4c, must submit a declaration to the assessor designating the cabins or units occupied for 250 days or less in the year preceding the year of assessment by January 15 of the assessment year. Those cabins or units and a proportionate share of the land on which they are located will be designated class 1c or 4c as otherwise provided. The remainder of the cabins or units and a proportionate share of the land on which they are located will be designated as class 3a. The owner of property desiring designation as class 1c or 4c property must provide guest registers or other records demonstrating that the units for which class 1c or 4c designation is sought were not occupied for more than 250 days in the year preceding the assessment if so requested. The portion of a property operated as a (1) restaurant, (2) bar, (3) gift shop, and (4) other nonresidential facility operated on a commercial basis not directly related to temporary and seasonal residential occupancy for recreation purposes shall not qualify for class 1c or 4c;

(2) qualified property used as a golf course if:

(i) any portion of the property is located within a county that has a population of less than 50,000, or within a county containing a golf course owned by a municipality, the county, or a special taxing district;

(ii) it is open to the public on a daily fee basis. It may charge membership fees or dues, but a membership fee may not be required in order to use the property for golfing, and its green fees for golfing must be comparable to green fees typically charged by municipal courses; and

(iii) it meets the requirements of section 273.112, subdivision 3, paragraph (d).

A structure used as a clubhouse, restaurant, or place of refreshment in conjunction with the golf course is classified as class 3a property.

(3) real property up to a maximum of one acre of land owned by a nonprofit community service oriented organization; provided that the property is not used for a revenue-producing activity for more than six days in the calendar year preceding the year of assessment and the property is not used for residential purposes on either a temporary or permanent basis. For purposes of this clause, a "nonprofit community service oriented organization" means any corporation, society, association, foundation, or institution organized and operated exclusively for charitable, religious, fraternal, civic, or educational purposes, and which is exempt from federal income taxation pursuant to section 501(c)(3), (10), or (19) of the Internal Revenue Code of 1986, as amended through December 31, 1990. For purposes of this clause, "revenue-producing activities" shall include but not be limited to property or that portion of the property that is used as an on-sale intoxicating liquor or 3.2 percent malt liquor establishment licensed under chapter 340A, a restaurant open to the public, bowling alley, a retail store, gambling conducted by organizations licensed under chapter 349, an insurance business, or office or other space leased or rented to a lessee who conducts a for-profit enterprise on the premises. Any portion of the property which is used for revenue-producing activities for more than six days in the calendar year preceding the year of assessment shall be assessed as class 3a. The use of the property for social events open exclusively to members and their guests for periods of less than 24 hours, when an admission is not charged nor any revenues are received by the organization shall not be considered a revenue-producing activity;

(4) post-secondary student housing of not more than one acre of land that is owned by a nonprofit corporation organized under chapter 317A and is used exclusively by a student cooperative, sorority, or fraternity for on-campus housing or housing located within two miles of the border of a college campus; and

(5) manufactured home parks as defined in section 327.14, subdivision 3.

(e) Class 4d property is qualifying low-income rental housing certified to the assessor by the housing finance agency under sections 273.126 and 462A.071. Class 4d includes land in proportion to the total market value of the building that is qualifying low-income rental housing. For all properties qualifying as class 4d, the market value determined by the assessor must be based on the normal approach to value using normal unrestricted rents.

Class 4d property has a class rate of one percent of market value.

(f) Class 4e property consists of the residential portion of any structure located within a city that was converted from nonresidential use to residential use, provided that:

(1) the structure had formerly been used as a warehouse;

(2) the structure was originally constructed prior to 1940;

(3) the conversion was done after December 31, 1995, but before January 1, 2003; and

(4) the conversion involved an investment of at least $25,000 per residential unit.

Class 4e property has a class rate of 2.3 percent, provided that a structure is eligible for class 4e classification only in the 12 assessment years immediately following the conversion.

Sec. 8. Minnesota Statutes 1997 Supplement, section 273.13, subdivision 31, is amended to read:

Subd. 31. [CLASS 5.] Class 5 property includes:

(1) tools, implements, and machinery of an electric generating, transmission, or distribution system or a pipeline system transporting or distributing water, gas, crude oil, or petroleum products or mains and pipes used in the distribution of steam or hot or chilled water for heating or cooling buildings, which are fixtures;

(2) unmined iron ore and low-grade iron-bearing formations as defined in section 273.14; and

(3) all other property not otherwise classified.

Class 5 property has a class rate of 4.0 3.5 percent of market value for taxes payable in 1998 1999 and thereafter.

Sec. 9. Minnesota Statutes 1997 Supplement, section 273.1382, subdivision 1, is amended to read:

Subdivision 1. [EDUCATION HOMESTEAD CREDIT.] Each year, beginning with property taxes payable in 1998, the respective county auditors shall determine the initial tax rate for each school district for the general education levy certified under section 124A.23, subdivision 2 or 3. That rate plus the school district's education homestead credit tax rate adjustment under section 275.08, subdivision 1e, shall be the general education homestead credit local tax rate for the district. The auditor shall then determine a general education homestead credit for each homestead within the county equal to 32 52 percent of the general education homestead credit local tax rate times the net tax capacity of the homestead for the taxes payable year. The amount of general education homestead credit for a homestead may not exceed $225 $290. In the case of an agricultural homestead, only the net tax capacity of the house, garage, and surrounding one acre of land shall be used in determining the property's education homestead credit.

Sec. 10. Minnesota Statutes 1996, section 273.1398, subdivision 2, is amended to read:

Sec. 11. Minnesota Statutes 1997 Supplement, section 290A.03, subdivision 11, is amended to read:

Subd. 11. [RENT CONSTITUTING PROPERTY TAXES.] "Rent constituting property taxes" means 18 19 percent of the gross rent actually paid in cash, or its equivalent, or the portion of rent paid in lieu of property taxes, in any calendar year by a claimant for the right of occupancy of the claimant's Minnesota homestead in the calendar year, and which rent constitutes the basis, in the succeeding calendar year of a claim for relief under this chapter by the claimant.

Sec. 12. Minnesota Statutes 1997 Supplement, section 290A.03, subdivision 13, is amended to read:

Subd. 13. [PROPERTY TAXES PAYABLE.] "Property taxes payable" means the property tax exclusive of special assessments, penalties, and interest payable on a claimant's homestead after deductions made under sections 273.135, 273.1382, 273.1391, 273.42, subdivision 2, and any other state paid property tax credits in any calendar year. In the case of a claimant who makes ground lease payments, "property taxes payable" includes the amount of the payments directly attributable to the property taxes assessed against the parcel on which the house is located. No apportionment or reduction of the "property taxes payable" shall be required for the use of a portion of the claimant's homestead for a business purpose if the claimant does not deduct any business depreciation expenses for the use of a portion of the homestead in the determination of federal adjusted gross income. For homesteads which are manufactured homes as defined in section 273.125, subdivision 8, and for homesteads which are park trailers taxed as manufactured homes under section 168.012, subdivision 9, "property taxes payable" shall also include 18 19 percent of the gross rent paid in the preceding year for the site on which the homestead is located. When a homestead is owned by two or more persons as joint tenants or tenants in common, such tenants shall determine between them which tenant may claim the property taxes payable on the homestead. If they are unable to agree, the matter shall be referred to the commissioner of revenue whose decision shall be final. Property taxes are considered payable in the year prescribed by law for payment of the taxes.

In the case of a claim relating to "property taxes payable," the claimant must have owned and occupied the homestead on January 2 of the year in which the tax is payable and (i) the property must have been classified as homestead property pursuant to section 273.124, on or before December 15 of the assessment year to which the "property taxes payable" relate; or (ii) the claimant must provide documentation from the local assessor that application for homestead classification has been made on or before December 15 of the year in which the "property taxes payable" were payable and that the assessor has approved the application.

Sec. 13. Minnesota Statutes 1996, section 477A.0122, subdivision 6, is amended to read:

Subd. 6. [REPORT.] On or before March 15 of the year following the year in which the distributions under this section are received, each county shall file with the commissioner of revenue and commissioner of human services a report on prior year expenditures for out-of-home placement and family preservation, including expenditures under this section. For the human services programs specified in this section, the commissioner of revenue and commissioner of human services, in consultation with representatives of county governments, shall make a recommendation to the 1999 legislature as to which current reporting requirements imposed on county governments, if any, may be eliminated, replaced, or consolidated on the report established by this section. For aid payable in calendar year 2000 and thereafter, each county shall provide information on the amount of state aid, local property tax revenue, and federal aid expended by that county on the programs specified in this section using the consolidated financial report recommended by the commissioner of revenue and commissioner of human services under this subdivision.

Sec. 14. Minnesota Statutes 1996, section 477A.03, subdivision 2, is amended to read:

Subd. 2. [ANNUAL APPROPRIATION.] (a) A sum sufficient to discharge the duties imposed by sections 477A.011 to 477A.014 is annually appropriated from the general fund to the commissioner of revenue. For aids payable in 1996 and thereafter, the total aids paid under sections section 477A.013, subdivision 9, and 477A.0122 are the amounts certified to be paid in the previous year, adjusted for inflation as provided under subdivision 3. Aid payments to counties under section 477A.0121 are limited to $20,265,000 in 1996. Aid payments to counties under section 477A.0121 are limited to $27,571,625 in 1997.

(c) For aid payable in 1999, the total aid payments under section 477A.0122 are the sum of:

(1) the amounts certified to be paid in the previous year, adjusted for inflation as provided in subdivision 3; plus

(2) $20,000,000; plus

(3) $10,000,000.

For aid payable in 2000 and thereafter, the total aid payments under section 477A.0122 are the amounts certified to be paid in the previous year, adjusted for inflation as provided in subdivision 3.

Sec. 15. [APPROPRIATIONS.]

(a) [SHIFT RECOGNITION APPROPRIATION.] In addition to any amounts appropriated by other law, $3,900,000 is appropriated to the commissioner of children, families, and learning in fiscal year 1999 to fund early recognition of education aid.

(b) [EDUCATION LEVY REDUCTION APPROPRIATION.] In addition to any amount appropriated by other law, $55,000,000 is appropriated to the commissioner of children, families, and learning in fiscal year 2000 and thereafter to fund a reduction in the statewide general education property tax levy.

Sec. 16. [INSTRUCTION TO REVISOR.]

In the next edition of the Minnesota Statutes, the revisor of statutes shall correct references to class 4e properties so that the statutes properly reflect the changes made to Minnesota Statutes, section 273.13, by this article.

Sec. 17. [REPEALER.]

Minnesota Statutes 1996, sections 273.11, subdivisions 6a and 15; and 273.124, subdivision 17, are repealed.

Sec. 18. [EFFECTIVE DATE.]

Sections 1, 3 to 10, and 18 are effective for taxes payable in 1999 and thereafter. Section 2 is effective for aid paid in fiscal year 2000 and thereafter. Sections 11 and 15 are effective for aid payable in 1999 and thereafter. Sections 12 and 13 are effective for rents paid in 1998 and thereafter. Sections 16 and 17 are effective the day following final enactment."

Amend the title accordingly

A roll call was requested and properly seconded.

Long moved to amend the Abrams et al amendment to H. F. No. 3840, the first engrossment, as amended, as follows:

Page 15, after line 24, insert:

"Sec. 9. Minnesota Statutes 1997 Supplement, section 273.13, subdivision 32, is amended to read:

(b) By the fourth Tuesday in January of 1998 and at the time of submission of the biennial budget under section 16A.11 in each biennium thereafter, the governor must recommend the class rate schedule for all properties for taxes payable in 1999 for the schedule submitted in 1998 and for the following two calendar years in each biennium thereafter. The class rate schedule must include reductions in the class rates of the classes designated in paragraph (a) until such time as the target class rates are reached unless the governor recommends no change in the class rate schedule for all properties. As part of the recommendation, the governor shall recommend appropriation of monies from the property tax reform account under section 16A.1521 and include within the budget additional funding for the education homestead credit, the property tax refund under chapter 290A and education aids under chapters 124 and 124A to the extent those aids will be used to reduce property tax levies. The governor may propose alternative programs to prevent the taxes of classes other than those designated in paragraph (a) from increasing as a result of the governor's recommended class rate schedule."

Renumber the remaining sections

A roll call was requested and properly seconded.

The question was taken on the amendment to the amendment and the roll was called.

Marko moved that those not voting be excused from voting. The motion prevailed.

There were 13 yeas and 117 nays as follows:

Those who voted in the affirmative were:

Bakk	Hausman	Jennings	Munger	Spk. Carruthers
Delmont	Huntley	Long	Olson, E.
Entenza	Jaros	Marko	Tunheim

Those who voted in the negative were:

Abrams	Erhardt	Kahn	McCollum	Peterson	Swenson, H.
Anderson, B.	Erickson	Kalis	McElroy	Pugh	Sykora
Anderson, I.	Evans	Kelso	McGuire	Rest	Tingelstad
Bettermann	Farrell	Kielkucki	Milbert	Reuter	Tomassoni
Biernat	Finseth	Kinkel	Molnau	Rhodes	Tompkins
Bishop	Folliard	Knight	Mulder	Rifenberg	Tuma
Boudreau	Garcia	Knoblach	Mullery	Rostberg	Van Dellen
Bradley	Goodno	Koskinen	Murphy	Rukavina	Vandeveer
Broecker	Greenfield	Kraus	Ness	Schumacher	Wagenius
Carlson	Greiling	Krinkie	Nornes	Seagren	Weaver
Chaudhary	Gunther	Kubly	Olson, M.	Seifert	Wejcman
Clark, J.	Haas	Kuisle	Opatz	Sekhon	Wenzel
Clark, K.	Harder	Larsen	Orfield	Skare	Westfall
Commers	Hasskamp	Leighton	Osskopp	Skoglund	Westrom
Daggett	Hilty	Leppik	Osthoff	Slawik	Winter
Davids	Holsten	Lieder	Otremba, M.	Smith	Wolf
Dawkins	Jefferson	Lindner	Ozment	Solberg	Workman
Dehler	Johnson, A.	Macklin	Paulsen	Stanek
Dempsey	Johnson, R.	Mahon	Pawlenty	Stang
Dorn	Juhnke	Mares	Pelowski	Sviggum

The question recurred on the Abrams et al amendment and the roll was called. There were 75 yeas and 58 nays as follows:

Those who voted in the affirmative were:

Abrams	Erhardt	Knight	Mulder	Rhodes	Tingelstad
Anderson, B.	Erickson	Knoblach	Ness	Rifenberg	Tompkins
Bettermann	Finseth	Kraus	Nornes	Rostberg	Tuma
Bishop	Folliard	Krinkie	Olson, M.	Schumacher	Van Dellen
Boudreau	Goodno	Kubly	Opatz	Seagren	Vandeveer
Bradley	Gunther	Kuisle	Osskopp	Seifert	Weaver
Broecker	Haas	Larsen	Otremba, M.	Slawik	Westfall
Clark, J.	Harder	Leppik	Ozment	Smith	Westrom
Commers	Holsten	Lindner	Paulsen	Stanek	Wolf
Daggett	Johnson, R.	Macklin	Pawlenty	Stang	Workman
Davids	Juhnke	Mares	Pelowski	Sviggum
Dehler	Kelso	McElroy	Rest	Swenson, H.
Dempsey	Kielkucki	Molnau	Reuter	Sykora

Those who voted in the negative were:

Anderson, I.	Evans	Jefferson	Mahon	Orfield	Tomassoni
Bakk	Farrell	Jennings	Mariani	Osthoff	Trimble
Biernat	Garcia	Johnson, A.	Marko	Paymar	Tunheim
Carlson	Greenfield	Kahn	McCollum	Peterson	Wagenius
Chaudhary	Greiling	Kalis	McGuire	Pugh	Wejcman
Clark, K.	Hasskamp	Kinkel	Milbert	Rukavina	Wenzel
Dawkins	Hausman	Koskinen	Mullery	Sekhon	Winter
Delmont	Hilty	Leighton	Munger	Skare	Spk. Carruthers
Dorn	Huntley	Lieder	Murphy	Skoglund
Entenza	Jaros	Long	Olson, E.	Solberg

The motion prevailed and the amendment was adopted.

Long moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Pages 1 to 16 of the Abrams et al amendment, delete sections 3 to 9 and insert:

"Sec. 9. Minnesota Statutes 1997 Supplement, section 273.127, subdivision 3, is amended to read:

Subd. 3. [CLASS 4C PROPERTIES.] For the market value of properties that meet the criteria of subdivision 2, paragraph (a), and which no longer qualify as a result of the eligibility criteria specified in section 273.126, a class rate of 2.4 percent applies for taxes payable in 1999 and a class rate of 2.6 2.5 percent applies for taxes payable in 2000.

Sec. 10. Minnesota Statutes 1997 Supplement, section 273.13, subdivision 22, is amended to read:

Subd. 22. [CLASS 1.] (a) Except as provided in subdivision 23, real estate which is residential and used for homestead purposes is class 1. The market value of class 1a property must be determined based upon the value of the house, garage, and land.

(b) Class 1b property includes homestead real estate or homestead manufactured homes used for the purposes of a homestead by

(1) any blind person, or the blind person and the blind person's spouse; or

(2) any person, hereinafter referred to as "veteran," who:

(i) served in the active military or naval service of the United States; and

(ii) is entitled to compensation under the laws and regulations of the United States for permanent and total service-connected disability due to the loss, or loss of use, by reason of amputation, ankylosis, progressive muscular dystrophies, or paralysis, of both lower extremities, such as to preclude motion without the aid of braces, crutches, canes, or a wheelchair; and

(iii) has acquired a special housing unit with special fixtures or movable facilities made necessary by the nature of the veteran's disability, or the surviving spouse of the deceased veteran for as long as the surviving spouse retains the special housing unit as a homestead; or

(3) any person who:

(i) is permanently and totally disabled and

(ii) receives 90 percent or more of total income from

(A) aid from any state as a result of that disability; or

(B) supplemental security income for the disabled; or

(C) workers' compensation based on a finding of total and permanent disability; or

(D) social security disability, including the amount of a disability insurance benefit which is converted to an old age insurance benefit and any subsequent cost of living increases; or

(E) aid under the federal Railroad Retirement Act of 1937, United States Code Annotated, title 45, section 228b(a)5; or

(F) a pension from any local government retirement fund located in the state of Minnesota as a result of that disability; or

(G) pension, annuity, or other income paid as a result of that disability from a private pension or disability plan, including employer, employee, union, and insurance plans and

(iii) has household income as defined in section 290A.03, subdivision 5, of $50,000 or less; or

(4) any person who is permanently and totally disabled and whose household income as defined in section 290A.03, subdivision 5, is 275 percent or less of the federal poverty level.

Property is classified and assessed under clause (4) only if the government agency or income-providing source certifies, upon the request of the homestead occupant, that the homestead occupant satisfies the disability requirements of this paragraph.

Property is classified and assessed pursuant to clause (1) only if the commissioner of economic security certifies to the assessor that the homestead occupant satisfies the requirements of this paragraph.

(c) Class 1c property is commercial use real property that abuts a lakeshore line and is devoted to temporary and seasonal residential occupancy for recreational purposes but not devoted to commercial purposes for more than 250 days in the year preceding the year of assessment, and that includes a portion used as a homestead by the owner, which includes a dwelling occupied as a homestead by a shareholder of a corporation that owns the resort or a partner in a partnership that owns the resort, even if the title to the homestead is held by the corporation or partnership. For purposes of this clause, property is devoted to a commercial purpose on a specific day if any portion of the property, excluding the portion used exclusively as a homestead, is used for residential occupancy and a fee is charged for residential occupancy. In order for a property to be classified as class 1c, at least 40 percent of the annual gross lodging receipts related to the property must be from business conducted between Memorial Day weekend and Labor Day weekend, and at least 60 percent of all bookings by lodging guests during the year must be for periods of at least two consecutive nights. Class 1c property has a class rate of one percent of total market value with the following limitation: the area of the property must not exceed 100 feet of lakeshore footage for each cabin or campsite located on the property up to a total of 800 feet and 500 feet in depth, measured away from the lakeshore.

(d) Class 1d property includes structures that meet all of the following criteria:

(1) the structure is located on property that is classified as agricultural property under section 273.13, subdivision 23;

(2) the structure is occupied exclusively by seasonal farm workers during the time when they work on that farm, and the occupants are not charged rent for the privilege of occupying the property, provided that use of the structure for storage of farm equipment and produce does not disqualify the property from classification under this paragraph;

(3) the structure meets all applicable health and safety requirements for the appropriate season; and

(4) the structure is not saleable as residential property because it does not comply with local ordinances relating to location in relation to streets or roads.

The market value of class 1d property has the same class rates as class 1a property under paragraph (a).

Sec. 11. Minnesota Statutes 1997 Supplement, section 273.13, subdivision 23, is amended to read:

Subd. 23. [CLASS 2.] (a) Class 2a property is agricultural land including any improvements that is homesteaded. The market value of the house and garage and immediately surrounding one acre of land has the same class rates as class 1a property under subdivision 22. The value of the remaining land including improvements up to $115,000 has a net class rate of 0.4 0.33 percent of market value. The remaining value of class 2a property over $115,000 of market value that does not exceed 320 acres has a net class rate of 0.9 0.7875 percent of market value. The remaining property over the $115,000 market value in excess of 320 acres has a class rate of 1.4 1.225 percent of market value.

(b) Class 2b property is (1) real estate, rural in character and used exclusively for growing trees for timber, lumber, and wood and wood products; (2) real estate that is not improved with a structure and is used exclusively for growing trees for timber, lumber, and wood and wood products, if the owner has participated or is participating in a cost-sharing program for afforestation, reforestation, or timber stand improvement on that particular property, administered or coordinated by the commissioner of natural resources; (3) real estate that is nonhomestead agricultural land; or (4) a landing area or public access area of a privately owned public use airport. Class 2b property has a net class rate of 1.4 1.225 percent of market value.

(d) Real estate, excluding the house, garage, and immediately surrounding one acre of land, of less than ten acres which is exclusively and intensively used for raising or cultivating agricultural products, shall be considered as agricultural land.

Land shall be classified as agricultural even if all or a portion of the agricultural use of that property is the leasing to, or use by another person for agricultural purposes.

Classification under this subdivision is not determinative for qualifying under section 273.111.

The property classification under this section supersedes, for property tax purposes only, any locally administered agricultural policies or land use restrictions that define minimum or maximum farm acreage.

(e) The term "agricultural products" as used in this subdivision includes production for sale of:

(1) livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing animals, horticultural and nursery stock described in sections 18.44 to 18.61, fruit of all kinds, vegetables, forage, grains, bees, and apiary products by the owner;

(2) fish bred for sale and consumption if the fish breeding occurs on land zoned for agricultural use;

(3) the commercial boarding of horses if the boarding is done in conjunction with raising or cultivating agricultural products as defined in clause (1);

(4) property which is owned and operated by nonprofit organizations used for equestrian activities, excluding racing; and

(5) game birds and waterfowl bred and raised for use on a shooting preserve licensed under section 97A.115.

(f) If a parcel used for agricultural purposes is also used for commercial or industrial purposes, including but not limited to:

(1) wholesale and retail sales;

(2) processing of raw agricultural products or other goods;

(3) warehousing or storage of processed goods; and

(4) office facilities for the support of the activities enumerated in clauses (1), (2), and (3),

the assessor shall classify the part of the parcel used for agricultural purposes as class 1b, 2a, or 2b, whichever is appropriate, and the remainder in the class appropriate to its use. The grading, sorting, and packaging of raw agricultural products for first sale is considered an agricultural purpose. A greenhouse or other building where horticultural or nursery products are grown that is also used for the conduct of retail sales must be classified as agricultural if it is primarily used for the growing of horticultural or nursery products from seed, cuttings, or roots and occasionally as a showroom for the retail sale of those products. Use of a greenhouse or building only for the display of already grown horticultural or nursery products does not qualify as an agricultural purpose.

The assessor shall determine and list separately on the records the market value of the homestead dwelling and the one acre of land on which that dwelling is located. If any farm buildings or structures are located on this homesteaded acre of land, their market value shall not be included in this separate determination.

(g) To qualify for classification under paragraph (b), clause (4), a privately owned public use airport must be licensed as a public airport under section 360.018. For purposes of paragraph (b), clause (4), "landing area" means that part of a privately owned public use airport properly cleared, regularly maintained, and made available to the public for use by aircraft and includes runways, taxiways, aprons, and sites upon which are situated landing or navigational aids. A landing area also includes land underlying both the primary surface and the approach surfaces that comply with all of the following:

(ii) the land is part of the airport property; and

(iii) the land is not used for commercial or residential purposes.

The land contained in a landing area under paragraph (b), clause (4), must be described and certified by the commissioner of transportation. The certification is effective until it is modified, or until the airport or landing area no longer meets the requirements of paragraph (b), clause (4). For purposes of paragraph (b), clause (4), "public access area" means property used as an aircraft parking ramp, apron, or storage hangar, or an arrival and departure building in connection with the airport.

Sec. 12. Minnesota Statutes 1997 Supplement, section 273.13, subdivision 24, is amended to read:

Subd. 24. [CLASS 3.] (a) Commercial and industrial property and utility real and personal property, except class 5 property as identified in subdivision 31, clause (1), is class 3a. Each parcel has a class rate of 2.7 2.3625 percent of the first tier of market value, and 4.0 3.5 percent of the remaining market value, except that in the case of contiguous parcels of commercial and industrial property owned by the same person or entity, only the value equal to the first-tier value of the contiguous parcels qualifies for the reduced class rate. For the purposes of this subdivision, the first tier means the first $150,000 of market value. In the case of utility property owned by one person or entity, only one parcel in each county has a reduced class rate on the first tier of market value.

For purposes of this paragraph, parcels are considered to be contiguous even if they are separated from each other by a road, street, vacant lot, waterway, or other similar intervening type of property.

(b) Employment property defined in section 469.166, during the period provided in section 469.170, shall constitute class 3b and has a class rate of 2.3 percent of the first $50,000 of market value and 3.6 3.5 percent of the remainder, except that for employment property located in a border city enterprise zone designated pursuant to section 469.168, subdivision 4, paragraph (c), the class rate of the first tier of market value and the class rate of the remainder is determined under paragraph (a), unless the governing body of the city designated as an enterprise zone determines that a specific parcel shall be assessed pursuant to the first clause of this sentence. The governing body may provide for assessment under the first clause of the preceding sentence only for property which is located in an area which has been designated by the governing body for the receipt of tax reductions authorized by section 469.171, subdivision 1.

(c) Structures which are (i) located on property classified as class 3a, (ii) constructed under an initial building permit issued after January 2, 1996, (iii) located in a transit zone as defined under section 473.3915, subdivision 3, (iv) located within the boundaries of a school district, and (v) not primarily used for retail or transient lodging purposes, shall have a class rate equal to 85 percent of the class rate of the second tier of the commercial property rate under paragraph (a) on any portion of the market value that does not qualify for the first tier class rate under paragraph (a). As used in item (v), a structure is primarily used for retail or transient lodging purposes if over 50 percent of its square footage is used for those purposes. The four percent rate A class rate equal to 85 percent of the class rate of the second tier of the commercial property rate under paragraph (a) shall also apply to improvements to existing structures that meet the requirements of items (i) to (v) if the improvements are constructed under an initial building permit issued after January 2, 1996, even if the remainder of the structure was constructed prior to January 2, 1996. For the purposes of this paragraph, a structure shall be considered to be located in a transit zone if any portion of the structure lies within the zone. If any property once eligible for treatment under this paragraph ceases to remain eligible due to revisions in transit zone boundaries, the property shall continue to receive treatment under this paragraph for a period of three years.

Sec. 13. Minnesota Statutes 1997 Supplement, section 273.13, subdivision 25, as amended by Laws 1997, Third Special Session chapter 3, section 28, is amended to read:

(b) Class 4b includes:

(1) residential real estate containing less than four units that does not qualify as class 4bb, other than seasonal residential, and recreational;

(2) manufactured homes not classified under any other provision;

(3) a dwelling, garage, and surrounding one acre of property on a nonhomestead farm classified under subdivision 23, paragraph (b) containing two or three units;

(4) unimproved property that is classified residential as determined under section 273.13, subdivision 33.

Class 4b property has a class rate of 2.1 1.7 percent of market value.

(c) Class 4bb includes:

(1) nonhomestead residential real estate containing one unit, other than seasonal residential, and recreational; and

(2) a single family dwelling, garage, and surrounding one acre of property on a nonhomestead farm classified under subdivision 23, paragraph (b).

Class 4bb has a class rate of 1.9 1.25 percent on the first $75,000 of market value and a class rate of 2.1 1.7 percent of its market value that exceeds $75,000.

Property that has been classified as seasonal recreational residential property at any time during which it has been owned by the current owner or spouse of the current owner does not qualify for class 4bb.

(d) Class 4c property includes:

(1) except as provided in subdivision 22, paragraph (c), real property devoted to temporary and seasonal residential occupancy for recreation purposes, including real property devoted to temporary and seasonal residential occupancy for recreation purposes and not devoted to commercial purposes for more than 250 days in the year preceding the year of assessment. For purposes of this clause, property is devoted to a commercial purpose on a specific day if any portion of the property is used for residential occupancy, and a fee is charged for residential occupancy. In order for a property to be classified as class 4c, seasonal recreational residential for commercial purposes, at least 40 percent of the annual gross lodging receipts related to the property must be from business conducted between Memorial Day weekend and Labor Day weekend and at least 60 percent of all bookings by lodging guests during the year must be for periods of at least two consecutive nights. Class 4c also includes commercial use real property used exclusively for recreational purposes in conjunction with class 4c property devoted to temporary and seasonal residential occupancy for recreational purposes, up to a total of two acres, provided the property is not devoted to commercial recreational use for more than 250 days in the year preceding the year of assessment and is located within two miles of the class 4c property with which it is used. Class 4c property classified in this clause also includes the remainder of class 1c resorts. Owners of real property devoted to temporary and seasonal residential occupancy for recreation purposes and all or a portion of which was devoted to commercial purposes for not more than 250 days in the year preceding the year of assessment desiring classification as class 1c or 4c, must submit a declaration to the assessor designating the cabins or units occupied for 250 days or less in the year preceding the year of assessment by January 15 of the assessment year. Those cabins or units and a proportionate share of the land on which they are located will be designated class 1c or 4c as otherwise provided. The remainder of the cabins or units and a proportionate share of the land on which they are located will be designated as class 3a. The owner of property desiring designation as class 1c or 4c property must provide guest registers or other records demonstrating that the units for which class 1c or 4c designation is sought were not occupied for more than 250 days in the year preceding the assessment if so requested. The portion of a property operated as a (1) restaurant, (2) bar, (3) gift shop, and (4) other nonresidential facility operated on a commercial basis not directly related to temporary and seasonal residential occupancy for recreation purposes shall not qualify for class 1c or 4c;

(2) qualified property used as a golf course if:

(ii) it is open to the public on a daily fee basis. It may charge membership fees or dues, but a membership fee may not be required in order to use the property for golfing, and its green fees for golfing must be comparable to green fees typically charged by municipal courses; and

(iii) it meets the requirements of section 273.112, subdivision 3, paragraph (d).

A structure used as a clubhouse, restaurant, or place of refreshment in conjunction with the golf course is classified as class 3a property.

(3) real property up to a maximum of one acre of land owned by a nonprofit community service oriented organization; provided that the property is not used for a revenue-producing activity for more than six days in the calendar year preceding the year of assessment and the property is not used for residential purposes on either a temporary or permanent basis. For purposes of this clause, a "nonprofit community service oriented organization" means any corporation, society, association, foundation, or institution organized and operated exclusively for charitable, religious, fraternal, civic, or educational purposes, and which is exempt from federal income taxation pursuant to section 501(c)(3), (10), or (19) of the Internal Revenue Code of 1986, as amended through December 31, 1990. For purposes of this clause, "revenue-producing activities" shall include but not be limited to property or that portion of the property that is used as an on-sale intoxicating liquor or 3.2 percent malt liquor establishment licensed under chapter 340A, a restaurant open to the public, bowling alley, a retail store, gambling conducted by organizations licensed under chapter 349, an insurance business, or office or other space leased or rented to a lessee who conducts a for-profit enterprise on the premises. Any portion of the property which is used for revenue-producing activities for more than six days in the calendar year preceding the year of assessment shall be assessed as class 3a. The use of the property for social events open exclusively to members and their guests for periods of less than 24 hours, when an admission is not charged nor any revenues are received by the organization shall not be considered a revenue-producing activity;

(4) post-secondary student housing of not more than one acre of land that is owned by a nonprofit corporation organized under chapter 317A and is used exclusively by a student cooperative, sorority, or fraternity for on-campus housing or housing located within two miles of the border of a college campus; and

(5) manufactured home parks as defined in section 327.14, subdivision 3.

Class 4c property has a the following class rate of 2.1 percent of market value, except that rates: (i) for each parcel of seasonal residential recreational property not used for commercial purposes the first $75,000 of market value has a class rate of 1.4 1.3 percent, and the market value that exceeds $75,000 has a class rate of 2.5 2.3 percent, and (ii) manufactured home parks assessed under clause (5) have a class rate of two percent; (iii) property described in paragraph (d), clause (4), has the same class rate applicable to the first $75,000 of class 4bb nonhomestead residential real estate under paragraph (c); and (iv) all other class 4c property has a class rate of 2.1 percent.

(e) Class 4d property is qualifying low-income rental housing certified to the assessor by the housing finance agency under sections 273.126 and 462A.071. Class 4d includes land in proportion to the total market value of the building that is qualifying low-income rental housing. For all properties qualifying as class 4d, the market value determined by the assessor must be based on the normal approach to value using normal unrestricted rents.

Class 4d property consisting of a structure, initial construction of which was begun after January 1, 1999, has a class rate of 2.5 percent of market value; all other class 4d property has a class rate of one percent of market value.

(f) Class 4e property consists of the residential portion of any structure located within a city that was converted from nonresidential use to residential use, provided that:

(1) the structure had formerly been used as a warehouse;

(2) the structure was originally constructed prior to 1940;

(3) the conversion was done after December 31, 1995, but before January 1, 2003; and

Class 4e property has a class rate of 2.3 percent, provided that a structure is eligible for class 4e classification only in the 12 assessment years immediately following the conversion.

Sec. 15. Minnesota Statutes 1997 Supplement, section 273.13, subdivision 31, is amended to read:

Subd. 31. [CLASS 5.] Class 5 property includes:

(1) tools, implements, and machinery of an electric generating, transmission, or distribution system or a pipeline system transporting or distributing water, gas, crude oil, or petroleum products or mains and pipes used in the distribution of steam or hot or chilled water for heating or cooling buildings, which are fixtures;

(2) unmined iron ore and low-grade iron-bearing formations as defined in section 273.14; and

(3) all other property not otherwise classified.

Class 5 property has a class rate of 4.0 3.5 percent of market value for taxes payable in 1998 1999 and thereafter.

Sec. 16. Minnesota Statutes 1997 Supplement, section 273.1382, subdivision 1, is amended to read:

Subdivision 1. [EDUCATION HOMESTEAD CREDIT.] Each year, beginning with property taxes payable in 1998, the respective county auditors shall determine the initial tax rate for each school district for the general education levy certified under section 124A.23, subdivision 2 or 3. That rate plus the school district's education homestead credit tax rate adjustment under section 275.08, subdivision 1e, shall be the general education homestead credit local tax rate for the district. The auditor shall then determine a general education homestead credit for each homestead within the county equal to 32 52 percent of the general education homestead credit local tax rate times the net tax capacity of the homestead for the taxes payable year. The amount of general education homestead credit for a homestead may not exceed $225 $290. In the case of an agricultural homestead, only the net tax capacity of the house, garage, and surrounding one acre of land shall be used in determining the property's education homestead credit."

Renumber the sections in sequence and correct internal references

Amend the title accordingly

A roll call was requested and properly seconded.

Abrams moved to amend the Long amendment to H. F. No. 3840, the first engrossment, as amended, as follows:

Page 1, line 11, delete "2.5" and insert "2.18"

A roll call was requested and properly seconded.

The question was taken on the amendment to the amendment and the roll was called. There were 65 yeas and 68 nays as follows:

Those who voted in the affirmative were:

Abrams	Dehler	Knight	Molnau	Rhodes	Tingelstad
Anderson, B.	Dempsey	Knoblach	Mulder	Rifenberg	Tompkins
Bettermann	Erhardt	Kraus	Ness	Rostberg	Tuma
Journal of the House - 89th Day - Wednesday, March 11, 1998 - Top of Page 8182
Bishop	Erickson	Krinkie	Nornes	Seagren	Van Dellen
Boudreau	Finseth	Kuisle	Olson, M.	Seifert	Vandeveer
Bradley	Goodno	Larsen	Osskopp	Smith	Weaver
Broecker	Gunther	Leppik	Ozment	Stanek	Westfall
Clark, J.	Haas	Lindner	Paulsen	Stang	Westrom
Commers	Harder	Macklin	Pawlenty	Sviggum	Wolf
Daggett	Holsten	Mares	Rest	Swenson, H.	Workman
Davids	Kielkucki	McElroy	Reuter	Sykora

Those who voted in the negative were:

Anderson, I.	Folliard	Johnson, R.	Mariani	Otremba, M.	Tomassoni
Bakk	Garcia	Juhnke	Marko	Paymar	Trimble
Biernat	Greenfield	Kahn	McCollum	Pelowski	Tunheim
Carlson	Greiling	Kalis	McGuire	Peterson	Wagenius
Chaudhary	Hasskamp	Kelso	Milbert	Pugh	Wejcman
Clark, K.	Hausman	Kinkel	Mullery	Rukavina	Wenzel
Dawkins	Hilty	Koskinen	Munger	Schumacher	Winter
Delmont	Huntley	Kubly	Murphy	Sekhon	Spk. Carruthers
Dorn	Jaros	Leighton	Olson, E.	Skare
Entenza	Jefferson	Lieder	Opatz	Skoglund
Evans	Jennings	Long	Orfield	Slawik
Farrell	Johnson, A.	Mahon	Osthoff	Solberg

The motion did not prevail and the amendment to the amendment was not adopted.

Abrams moved to amend the Long amendment to H. F. No. 3840, the first engrossment, as amended, as follows:

Page 8, line 22, delete "3.5" and insert "3.07"

A roll call was requested and properly seconded.

The question was taken on the amendment to the amendment and the roll was called. There were 66 yeas and 67 nays as follows:

Those who voted in the affirmative were:

Abrams	Dehler	Knight	Molnau	Rhodes	Sykora
Anderson, B.	Dempsey	Knoblach	Mulder	Rifenberg	Tingelstad
Bettermann	Erhardt	Kraus	Ness	Rostberg	Tompkins
Bishop	Erickson	Krinkie	Nornes	Schumacher	Tuma
Boudreau	Finseth	Kuisle	Olson, M.	Seagren	Van Dellen
Bradley	Goodno	Larsen	Osskopp	Seifert	Vandeveer
Broecker	Gunther	Leppik	Ozment	Smith	Weaver
Clark, J.	Haas	Lindner	Paulsen	Stanek	Westfall
Commers	Harder	Macklin	Pawlenty	Stang	Westrom
Daggett	Holsten	Mares	Rest	Sviggum	Wolf
Davids	Kielkucki	McElroy	Reuter	Swenson, H.	Workman

Those who voted in the negative were:

Anderson, I.	Folliard	Johnson, R.	Mariani	Otremba, M.	Trimble
Bakk	Garcia	Juhnke	Marko	Paymar	Tunheim
Biernat	Greenfield	Kahn	McCollum	Pelowski	Wagenius
Carlson	Greiling	Kalis	McGuire	Peterson	Wejcman
Chaudhary	Hasskamp	Kelso	Milbert	Pugh	Wenzel
Clark, K.	Hausman	Kinkel	Mullery	Rukavina	Winter
Journal of the House - 89th Day - Wednesday, March 11, 1998 - Top of Page 8183
Dawkins	Hilty	Koskinen	Munger	Sekhon	Spk. Carruthers
Delmont	Huntley	Kubly	Murphy	Skare
Dorn	Jaros	Leighton	Olson, E.	Skoglund
Entenza	Jefferson	Lieder	Opatz	Slawik
Evans	Jennings	Long	Orfield	Solberg
Farrell	Johnson, A.	Mahon	Osthoff	Tomassoni

The motion did not prevail and the amendment to the amendment was not adopted.

The question recurred on the Long amendment and the roll was called. There were 70 yeas and 63 nays as follows:

Those who voted in the affirmative were:

Anderson, I.	Folliard	Johnson, R.	Mariani	Otremba, M.	Trimble
Bakk	Garcia	Juhnke	Marko	Paymar	Tuma
Biernat	Greenfield	Kahn	McCollum	Pelowski	Tunheim
Carlson	Greiling	Kalis	McGuire	Peterson	Vandeveer
Chaudhary	Hasskamp	Kelso	Milbert	Pugh	Wagenius
Clark, K.	Hausman	Kinkel	Mullery	Rukavina	Wejcman
Dawkins	Hilty	Koskinen	Munger	Sekhon	Wenzel
Delmont	Huntley	Kubly	Murphy	Skare	Westrom
Dorn	Jaros	Leighton	Olson, E.	Skoglund	Winter
Entenza	Jefferson	Lieder	Opatz	Slawik	Spk. Carruthers
Evans	Jennings	Long	Orfield	Solberg
Farrell	Johnson, A.	Mahon	Osthoff	Tomassoni

Those who voted in the negative were:

Abrams	Dehler	Knight	Molnau	Rhodes	Sykora
Anderson, B.	Dempsey	Knoblach	Mulder	Rifenberg	Tingelstad
Bettermann	Erhardt	Kraus	Ness	Rostberg	Tompkins
Bishop	Erickson	Krinkie	Nornes	Schumacher	Van Dellen
Boudreau	Finseth	Kuisle	Olson, M.	Seagren	Weaver
Bradley	Goodno	Larsen	Osskopp	Seifert	Westfall
Broecker	Gunther	Leppik	Ozment	Smith	Wolf
Clark, J.	Haas	Lindner	Paulsen	Stanek	Workman
Commers	Harder	Macklin	Pawlenty	Stang
Daggett	Holsten	Mares	Rest	Sviggum
Davids	Kielkucki	McElroy	Reuter	Swenson, H.

The motion prevailed and the amendment was adopted.

Folliard moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Page 3, line 15, after the period insert "Persons occupying homesteads under section 273.124, subdivision 1, paragraph (c) qualify for the property tax rebate as a homeowner under this section if (1) the dwelling is the occupant's principal residence, (2) the occupant is a Minnesota resident, and (3) the occupant has paid the 1998 property taxes on that property."

Page 5, line 34, after the period insert "Persons occupying homesteads under section 273.124, subdivision 1, paragraph (c) qualify for the property tax rebate as a homeowner under this section if (1) the dwelling is the occupant's principal residence, (2) the occupant is a Minnesota resident, and (3) the occupant has paid the 1997 property taxes on that property."

Milbert, Murphy, Rukavina, Pawlenty, Mares, Wenzel, Vandeveer, Osskopp, Pugh, McGuire, Workman, Pelowski, Kalis, Chaudhary, Larsen, Delmont, Weaver, Jennings, Trimble, Hilty, Tuma, Hasskamp, Bakk, Stang, Tomassoni and Holsten moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Page 44, after line 18, insert:

"Sec. 4. Minnesota Statutes 1997 Supplement, section 273.11, subdivision 1a, is amended to read:

Subd. 1a. [LIMITED MARKET VALUE.] (a) For the 1998 assessment, for taxes payable in 1999, a property classified under section 273.13 may not have a market value for property tax purposes greater than the sum of (1) its taxable market value or, if applicable, its limited market value, used in determining property taxes payable in 1998, plus (2) an amount obtained by multiplying the market value in clause (1) by the percentage rate of increase in the Consumer Price Index for the 12-month period ending October 31, 1997.

(b) For assessment years 1999 through 2001, for taxes payable in 2000 through 2002, in the case of all property classified as agricultural homestead or nonhomestead, residential homestead or nonhomestead, or noncommercial seasonal recreational residential under section 273.13, the assessor shall compare the value with that determined in the preceding assessment. The amount of the increase entered in the current assessment shall not exceed the greater of (1) ten percent of the value in the preceding assessment, or (2) one-fourth of the difference between the current assessment and the preceding assessment the lesser of (1) five percent, or (2) the percentage rate of increase, if any, in the Consumer Price Index for the 12-month period ending October 31 of the preceding assessment year. This limitation shall not apply to increases in value due to improvements. For purposes of this subdivision, the term "assessment" means the value prior to any exclusion under subdivision 16.

The provisions of this subdivision shall be in effect only for assessment years 1993 1998 through 2001.

(c) For the first assessment year after the sale or conveyance of property for which the assessor's estimated market value is greater than the market value determined under this subdivision, the value of the property for property tax purposes shall be increased to the assessor's estimated market value.

(d) For purposes of this subdivision, "Consumer Price Index" means the Consumer Price Index of all urban consumers as determined by the United States Department of Labor, Bureau of Labor Statistics.

(e) For purposes of the assessment/sales ratio study conducted under section 124.2131, and the computation of state aids paid under chapters 124, 124A, and 477A, market values and net tax capacities determined under this subdivision and subdivision 16, shall be used."

Page 66, line 16, after "1999" insert "through 2001"

Page 66, line 22, delete "and 1999" and insert "through 2001"

Page 84, line 8, strike "levied in 1997" and the comma

Page 84, line 9, strike the current language and delete the new language and insert "through payable 2002."

Page 84, line 13, strike "1998", delete the new language, and after "1997" insert "through 2001"

Page 90, line 8, delete the new language, after the first "1999" insert "through taxes levied in 2001, payable in 2002"

Page 90, line 9, delete "payable in 2000"

Page 90, line 10, delete "and 1999" and insert "through 2001"

Renumber the sections in sequence and correct internal references

Amend the title accordingly

The question was taken on the Milbert et al amendment and the roll was called. There were 89 yeas and 44 nays as follows:

Those who voted in the affirmative were:

Anderson, B.	Entenza	Kalis	McCollum	Paymar	Stanek
Bakk	Erhardt	Kelso	McGuire	Pelowski	Stang
Bettermann	Erickson	Kielkucki	Milbert	Pugh	Swenson, H.
Biernat	Evans	Kinkel	Molnau	Reuter	Tingelstad
Boudreau	Farrell	Knight	Mulder	Rhodes	Tomassoni
Broecker	Finseth	Kraus	Murphy	Rifenberg	Tompkins
Chaudhary	Gunther	Krinkie	Ness	Rostberg	Tuma
Clark, J.	Harder	Kubly	Nornes	Rukavina	Van Dellen
Commers	Hasskamp	Larsen	Olson, M.	Schumacher	Vandeveer
Daggett	Holsten	Leppik	Opatz	Seagren	Weaver
Davids	Jaros	Lindner	Osskopp	Seifert	Wenzel
Dehler	Jennings	Macklin	Osthoff	Sekhon	Westfall
Delmont	Johnson, A.	Mares	Otremba, M.	Slawik	Westrom
Dempsey	Johnson, R.	Mariani	Paulsen	Smith	Workman
Dorn	Juhnke	Marko	Pawlenty	Solberg

Those who voted in the negative were:

Abrams	Garcia	Jefferson	Mahon	Rest	Wejcman
Anderson, I.	Goodno	Kahn	McElroy	Skare	Winter
Bishop	Greenfield	Knoblach	Mullery	Skoglund	Wolf
Bradley	Greiling	Koskinen	Munger	Sviggum	Spk. Carruthers
Carlson	Haas	Kuisle	Olson, E.	Sykora
Clark, K.	Hausman	Leighton	Orfield	Trimble
Dawkins	Hilty	Lieder	Ozment	Tunheim
Folliard	Huntley	Long	Peterson	Wagenius

The motion prevailed and the amendment was adopted.

Rest, Haas, Weaver and Chaudhary moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Delete page 2, line 53 to page 4, line 5, and insert:

"Section 1. [1998 PROPERTY TAX REBATE.]

Subdivision 1. [PRINCIPAL RESIDENCE.] (a) A credit is allowed against the tax imposed under Minnesota Statutes, chapter 290, to an individual equal to 20 percent of the qualified property tax paid before January 1, 1999, for taxes assessed in 1997. The maximum credit is $1,500, less any credit the individual claims under subdivision 2.

(b) For property owned and occupied by the individual during 1998, qualified property tax means property taxes payable as defined in Minnesota Statutes, section 290A.03, subdivision 13, assessed in 1997 and payable in 1998, except the requirement that the taxpayer own and occupy the property on January 2, 1998, does not apply. The property tax must be deductible under section 164 of the Internal Revenue Code to qualify. In the case of agricultural land assessed as part of a homestead pursuant to Minnesota Statutes, section 273.13, subdivision 23, the owner is allowed to calculate the credit on all property taxes on the homestead, except to the extent the owner is required to furnish a rent certificate under section 290A.19 to a tenant leasing a part of the farm homestead.

(d) For an individual who both owned and rented principal residences in calendar year 1998, qualified taxes are the sum of the amounts under paragraphs (a) and (b).

Subd. 2. [SECOND HOME CREDIT.] (a) In addition to the credit allowed under subdivision 1, an individual may claim a credit equal to 20 percent of the net taxes paid before January 1, 1999, for taxes assessed in 1997 on a seasonal residential property not used for commercial purposes, classified under Minnesota Statutes, section 273.13, subdivision 25. The maximum amount of the credit equals the lesser of:

(1) $500; or

(2) the liability for tax under Minnesota Statutes, sections 290.06, subdivision 2c, and 290.091, for the taxable year before allowance of refundable credits including the credit under subdivision 1.

(b) For purposes of this subdivision, net taxes are taxes after any credit allowed under Minnesota Statutes, sections 290.06, subdivision 25, and 290A.04, subdivision 2j.

(c) To qualify, the individual must own the property, in whole or part, and the taxes must be deductible under section 164 of the Internal Revenue Code.

Subd. 3. [DEFINITIONS.] (a) For purposes of this section, the following terms have the meanings given.

(b) "Individual" excludes a dependent as defined in sections 151 and 152 of the Internal Revenue Code, disregarding section 152(b)(3).

(c) "Internal Revenue Code" means the Internal Revenue Code of 1986, as amended through December 31, 1998.

Subd. 4. [ADMINISTRATIVE PROVISIONS.] (a) If the amount of the credit under this section exceeds the taxpayer's tax liability under Minnesota Statutes, chapter 290, the commissioner shall refund the excess.

(b) To claim a credit under this section, the taxpayer must attach a copy of the property tax statement and certificate of rent paid, as applicable, and provide any additional information the commissioner requires.

(c) An amount sufficient to pay refunds under this section is appropriated to the commissioner from the general fund.

(d) This credit applies to taxable years beginning after December 31, 1997, and before January 1, 1999.

(e) Payment of the credit under this section is subject to Minnesota Statutes, chapter 270A, and any other provision applicable to refunds under Minnesota Statutes, chapter 290."

Page 4, line 6, delete "(j)" and insert "(f)"

A roll call was requested and properly seconded.

The question was taken on the Rest et al amendment and the roll was called. There were 99 yeas and 34 nays as follows:

Those who voted in the affirmative were:

Abrams	Dorn	Kielkucki	Milbert	Peterson	Sviggum
Anderson, B.	Entenza	Knight	Molnau	Pugh	Swenson, H.
Bettermann	Erhardt	Knoblach	Mulder	Rest	Sykora
Biernat	Erickson	Koskinen	Mullery	Reuter	Tingelstad
Bishop	Evans	Kraus	Murphy	Rhodes	Tompkins
Boudreau	Farrell	Krinkie	Ness	Rifenberg	Tuma
Bradley	Finseth	Kuisle	Nornes	Rostberg	Van Dellen
Broecker	Folliard	Larsen	Olson, M.	Rukavina	Vandeveer
Journal of the House - 89th Day - Wednesday, March 11, 1998 - Top of Page 8187
Carlson	Goodno	Leighton	Opatz	Schumacher	Weaver
Chaudhary	Greiling	Leppik	Osskopp	Seagren	Westfall
Clark, J.	Gunther	Lindner	Osthoff	Seifert	Westrom
Commers	Haas	Macklin	Otremba, M.	Sekhon	Wolf
Daggett	Harder	Mares	Ozment	Skoglund	Workman
Davids	Holsten	Marko	Paulsen	Slawik	Spk. Carruthers
Dehler	Johnson, R.	McCollum	Pawlenty	Smith
Delmont	Juhnke	McElroy	Paymar	Stanek
Dempsey	Kelso	McGuire	Pelowski	Stang

Those who voted in the negative were:

Anderson, I.	Hasskamp	Jennings	Lieder	Orfield	Wagenius
Bakk	Hausman	Johnson, A.	Long	Skare	Wejcman
Clark, K.	Hilty	Kahn	Mahon	Solberg	Wenzel
Dawkins	Huntley	Kalis	Mariani	Tomassoni	Winter
Garcia	Jaros	Kinkel	Munger	Trimble
Greenfield	Jefferson	Kubly	Olson, E.	Tunheim

The motion prevailed and the amendment was adopted.

Osskopp moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Page 151, delete section 12

Renumber the sections in sequence and correct internal references

Amend the title accordingly

A roll call was requested and properly seconded.

The question was taken on the Osskopp amendment and the roll was called.

Winter moved that those not voting be excused from voting. The motion prevailed.

There were 132 yeas and 0 nays as follows:

Those who voted in the affirmative were:

Abrams	Erhardt	Johnson, R.	Mares	Paulsen	Stang
Anderson, B.	Erickson	Juhnke	Mariani	Pawlenty	Sviggum
Anderson, I.	Evans	Kahn	Marko	Paymar	Swenson, H.
Bakk	Farrell	Kalis	McCollum	Pelowski	Sykora
Bettermann	Finseth	Kelso	McElroy	Peterson	Tingelstad
Biernat	Folliard	Kielkucki	McGuire	Pugh	Tomassoni
Bishop	Garcia	Kinkel	Milbert	Rest	Tompkins
Boudreau	Goodno	Knight	Molnau	Reuter	Trimble
Bradley	Greenfield	Knoblach	Mulder	Rhodes	Tuma
Broecker	Greiling	Koskinen	Mullery	Rifenberg	Tunheim
Carlson	Gunther	Kraus	Munger	Rostberg	Van Dellen
Chaudhary	Haas	Krinkie	Murphy	Rukavina	Vandeveer
Clark, J.	Harder	Kubly	Ness	Schumacher	Wagenius
Clark, K.	Hasskamp	Kuisle	Nornes	Seagren	Weaver
Commers	Hausman	Larsen	Olson, E.	Seifert	Wejcman
Daggett	Hilty	Leighton	Olson, M.	Sekhon	Wenzel
Davids	Holsten	Leppik	Opatz	Skare	Westfall
Dehler	Huntley	Lieder	Orfield	Skoglund	Westrom
Journal of the House - 89th Day - Wednesday, March 11, 1998 - Top of Page 8188
Delmont	Jaros	Lindner	Osskopp	Slawik	Winter
Dempsey	Jefferson	Long	Osthoff	Smith	Wolf
Dorn	Jennings	Macklin	Otremba, M.	Solberg	Workman
Entenza	Johnson, A.	Mahon	Ozment	Stanek	Spk. Carruthers

The motion prevailed and the amendment was adopted.

Trimble, Farrell, Mariani and McCollum moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Page 21, lines 2 to 12, delete the new language and reinstate the stricken language

The motion did not prevail and the amendment was not adopted.

Macklin was excused between the hours of 5:55 p.m. and 7:10 p.m.

Abrams offered an amendment to H. F. No. 3840, the first engrossment, as amended.

Lieder raised a point of order pursuant to rule 3.09 that the Abrams amendment was not in order. The Speaker ruled the point of order well taken and the Abrams amendment out of order.

Van Dellen, Harder and Kraus moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Page 109, line 17, strike "$19,910" and insert "$24,800" and strike "6" and insert "5.5"

Page 109, line 18, strike "$19,910" and insert "$24,800" and strike "$79,120" and insert "$98,540" and strike "8" and insert " 7.5"

Page 109, line 19, strike "$79,120" and insert "$98,540" and strike "8.5" and insert "8"

Page 109, line 27, strike "$13,620" and insert "$16,960" and strike "6" and insert "5.5"

Page 109, line 28, strike "$13,620" and insert "$16,960" and strike "$44,750" and insert "$55,730" and strike "8" and insert "7.5"

Page 109, line 29, strike "$44,750" and insert "$55,730" and strike "8.5" and insert "8"

Page 109, line 34, strike "$16,770" and insert "$20,890" and strike "6" and insert "5.5"

Page 109, line 35, strike "$16,770" and insert "$20,890" and strike "$67,390" and insert "$83,930" and strike "8" and insert "7.5"

Page 110, after line 34, insert:

"Sec. 8. Minnesota Statutes 1996, section 290.06, subdivision 2d, is amended to read:

Subd. 2d. [INFLATION ADJUSTMENT OF BRACKETS.] (a) For taxable years beginning after December 31, 1991 1998, the minimum and maximum dollar amounts for each rate bracket for which a tax is imposed in subdivision 2c shall be adjusted for inflation by the percentage determined under paragraph (b). For the purpose of making the adjustment as provided in this subdivision all of the rate brackets provided in subdivision 2c shall be the rate brackets as they existed for taxable years beginning after December 31, 1990 1997, and before January 1, 1992 1999. The rate applicable to any rate bracket must not be changed. The dollar amounts setting forth the tax shall be adjusted to reflect the changes in the rate brackets. The rate brackets as adjusted must be rounded to the nearest $10 amount. If the rate bracket ends in $5, it must be rounded up to the nearest $10 amount.

(b) The commissioner shall adjust the rate brackets and by the percentage determined pursuant to the provisions of section 1(f) of the Internal Revenue Code, except that in section 1(f)(3)(B) the word "1990 1997" shall be substituted for the word "1987." For 1991 1998, the commissioner shall then determine the percent change from the 12 months ending on August 31, 1990 1997, to the 12 months ending on August 31, 1991 1998, and in each subsequent year, from the 12 months ending on August 31, 1990 1998, to the 12 months ending on August 31 of the year preceding the taxable year. The determination of the commissioner pursuant to this subdivision shall not be considered a "rule" and shall not be subject to the administrative procedure act contained in chapter 14.

No later than December 15 of each year, the commissioner shall announce the specific percentage that will be used to adjust the tax rate brackets."

Page 114, after line 10, insert:

"Sec. 12. Minnesota Statutes 1996, section 290.091, subdivision 1, is amended to read:

Subdivision 1. [IMPOSITION OF TAX.] In addition to all other taxes imposed by this chapter a tax is imposed on individuals, estates, and trusts equal to the excess (if any) of

(a) an amount equal to seven 6.8 percent of alternative minimum taxable income after subtracting the exemption amount, over

(b) the regular tax for the taxable year."

Page 115, line 30, delete "seven" and insert "6.8"

Page 116, line 28, delete "seven" and insert "6.8"

Page 122, after line 23, insert "and the changes in the rates and brackets"

Page 122, line 24, delete "is" and insert "are"

Page 122, line 26, before the semicolon insert "and paragraph (c)"

Page 122, line 27, after the second comma insert "the rate change in clause (2),"

Page 122, line 31, after the period insert "Section 8 is effective for tax years beginning after December 31, 1998. Section 12 is effective for tax years beginning after December 31, 1997."

Renumber the sections in sequence and correct internal references

Amend the title accordingly

A roll call was requested and properly seconded.

Weaver moved that those not voting be excused from voting. The motion did not prevail.

Marko moved that those not voting be excused from voting. The motion prevailed.

There were 64 yeas and 68 nays as follows:

Those who voted in the affirmative were:

Abrams	Dehler	Kielkucki	Molnau	Rifenberg	Tompkins
Anderson, B.	Dempsey	Knight	Mulder	Rostberg	Tuma
Bettermann	Erhardt	Knoblach	Ness	Seagren	Van Dellen
Bishop	Erickson	Kraus	Nornes	Seifert	Vandeveer
Boudreau	Farrell	Krinkie	Olson, M.	Smith	Weaver
Bradley	Finseth	Kuisle	Osskopp	Stanek	Westfall
Broecker	Goodno	Larsen	Ozment	Stang	Westrom
Clark, J.	Gunther	Leppik	Paulsen	Sviggum	Wolf
Commers	Haas	Lindner	Pawlenty	Swenson, H.	Workman
Daggett	Harder	Mares	Reuter	Sykora
Davids	Holsten	McElroy	Rhodes	Tingelstad

Those who voted in the negative were:

Anderson, I.	Garcia	Juhnke	Marko	Paymar	Tomassoni
Bakk	Greenfield	Kahn	McCollum	Pelowski	Trimble
Biernat	Greiling	Kalis	McGuire	Peterson	Tunheim
Carlson	Hasskamp	Kelso	Milbert	Pugh	Wagenius
Chaudhary	Hausman	Kinkel	Mullery	Rest	Wejcman
Clark, K.	Hilty	Koskinen	Munger	Rukavina	Wenzel
Dawkins	Huntley	Kubly	Murphy	Schumacher	Winter
Delmont	Jaros	Leighton	Olson, E.	Sekhon	Spk. Carruthers
Dorn	Jefferson	Lieder	Opatz	Skare
Entenza	Jennings	Long	Orfield	Skoglund
Evans	Johnson, A.	Mahon	Osthoff	Slawik
Folliard	Johnson, R.	Mariani	Otremba, M.	Solberg

The motion did not prevail and the amendment was not adopted.

The Speaker called Wejcman to the Chair.

Huntley, Haas, Juhnke and Dorn moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Page 217, after line 10, insert:

Section 1. Minnesota Statutes 1996, section 295.52, subdivision 1, is amended to read:

Sec. 2. Minnesota Statutes 1996, section 295.52, subdivision 1a, is amended to read:

Subd. 1a. [SURGICAL CENTER TAX.] A tax is imposed on each surgical center equal to two percent of its gross revenues multiplied by the rate specified under subdivision 8 which is based on the revenues raised from the taxes in sections 6 to 11.

Sec. 3. Minnesota Statutes 1996, section 295.52, subdivision 2, is amended to read:

Subd. 2. [PROVIDER TAX.] A tax is imposed on each health care provider equal to two percent of its gross revenues multiplied by the rate specified under subdivision 8 which is based on the revenues raised from the taxes in sections 6 to 11.

Sec. 4. Minnesota Statutes 1996, section 295.52, subdivision 3, is amended to read:

Subd. 3. [WHOLESALE DRUG DISTRIBUTOR TAX.] A tax is imposed on each wholesale drug distributor equal to two percent of its gross revenues multiplied by the rate specified under subdivision 8 which is based on the revenues raised from the taxes in sections 6 to 11.

Sec. 5. Minnesota Statutes 1996, section 295.52, is amended by adding a subdivision to read:

Subd. 8. [TAX RATE.] (a) The tax rate for each of the subdivisions under this section is as provided by this subdivision.

(b) For calendar year 1998, the tax rate is 0.75 percent. For calendar years thereafter, the tax rate is zero.

Sec. 6. Minnesota Statutes 1997 Supplement, section 297F.05, subdivision 1, is amended to read:

Subdivision 1. [RATES; CIGARETTES.] A tax is imposed upon the sale of cigarettes in this state, upon having cigarettes in possession in this state with intent to sell, upon any person engaged in business as a distributor, and upon the use or storage by consumers, at the following rates, subject to the discount provided in this chapter:

(1) on cigarettes weighing not more than three pounds per thousand, 24 44 mills on each such cigarette; and

(2) on cigarettes weighing more than three pounds per thousand, 48 88 mills on each such cigarette.

Sec. 7. Minnesota Statutes 1997 Supplement, section 297F.05, subdivision 3, is amended to read:

Subd. 3. [RATES; TOBACCO PRODUCTS.] A tax is imposed upon all tobacco products in this state and upon any person engaged in business as a distributor, at the rate of 35 64 percent of the wholesale sales price of the tobacco products. The tax is imposed at the time the distributor:

(1) brings, or causes to be brought, into this state from outside the state tobacco products for sale;

(2) makes, manufactures, or fabricates tobacco products in this state for sale in this state; or

(3) ships or transports tobacco products to retailers in this state, to be sold by those retailers.

Sec. 8. Minnesota Statutes 1997 Supplement, section 297F.08, subdivision 7, is amended to read:

Sec. 9. Minnesota Statutes 1997 Supplement, section 297F.09, subdivision 2, is amended to read:

Subd. 2. [MONTHLY RETURN; TOBACCO PRODUCTS DISTRIBUTOR.] On or before the 18th day of each calendar month, a distributor with a place of business in this state shall file a return with the commissioner showing the quantity and wholesale sales price of each tobacco product:

(1) brought, or caused to be brought, into this state for sale; and

(2) made, manufactured, or fabricated in this state for sale in this state, during the preceding calendar month.

Every licensed distributor outside this state shall in like manner file a return showing the quantity and wholesale sales price of each tobacco product shipped or transported to retailers in this state to be sold by those retailers, during the preceding calendar month. Returns must be made in the form and manner prescribed by the commissioner and must contain any other information required by the commissioner. The return must be accompanied by a remittance for the full tax liability shown, less 1.5 0.82 percent of the liability as compensation to reimburse the distributor for expenses incurred in the administration of this chapter. The return for the May liability and 75 percent of the estimated June liability is due on the date payment of the tax is due.

Sec. 10. Minnesota Statutes 1997 Supplement, section 297F.10, is amended to read:

297F.10 [DEPOSIT OF PROCEEDS.]

Subdivision 1. [TAX AND USE TAX ON CIGARETTES.] Revenue received from cigarette taxes, as well as related penalties, interest, license fees, and miscellaneous sources of revenue shall be deposited by the commissioner in the state treasury and credited as follows:

(a) first to the general obligation special tax bond debt service account in each fiscal year the amount required to increase the balance on hand in the account on each December 1 to an amount equal to the full amount of principal and interest to come due on all outstanding bonds whose debt service is payable primarily from the proceeds of the tax to and including the second following July 1; and

(b) after the requirements of paragraph (a) have been met:

(1) the revenue produced by one mill of the tax on cigarettes weighing not more than three pounds a thousand and two mills of the tax on cigarettes weighing more than three pounds a thousand must be credited to the Minnesota future resources fund; and

(2) the revenue produced by 20 mills of the tax on cigarettes weighing not more than three pounds per thousand and 40 mills of the tax on cigarettes weighing more than three pounds per thousand must be credited to the health care access fund in the state treasury; and

(3) the balance of the revenues derived from taxes, penalties, and interest (under this chapter) and from license fees and miscellaneous sources of revenue shall be credited to the general fund.

Subd. 2. [TAX AND USE TAX ON TOBACCO PRODUCTS.] Revenue received from taxes on tobacco products, as well as related penalties, interest, and license fees shall be deposited by the commissioner in the state treasury and credited 55 percent to the general fund and 45 percent to the health care access fund.

Sec. 11. [FLOOR STOCKS TAX.]

Subdivision 1. [CIGARETTES.] A floor stocks tax is imposed on every person engaged in business in this state as a distributor, retailer, subjobber, vendor, manufacturer, or manufacturer's representative of cigarettes, on the stamped cigarettes and unaffixed stamps in the person's possession or under the person's control at 12:01 a.m. on July 1, 1998. The tax is imposed at the following rates, subject to the discounts in Minnesota Statutes, section 297F.08, subdivision 7:

(1) on cigarettes weighing not more than three pounds per thousand, 20 mills on each cigarette; and

Each distributor, by July 8, 1998, shall file a report with the commissioner of revenue, in the form the commissioner prescribes, showing the stamped cigarettes and unaffixed stamps on hand at 12:01 a.m. on July 1, 1998, and the amount of tax due on the cigarettes and unaffixed stamps. The tax imposed by this section is due and payable by August 1, 1998, and after that date bears interest as provided in Minnesota Statutes, section 270.75.

Each retailer, subjobber, vendor, manufacturer, or manufacturer's representative shall file a return with the commissioner, in the form the commissioner prescribes, showing the cigarettes on hand at 12:01 a.m. on July 1, 1998, and pay the tax due on them by August 1, 1998. Tax not paid by the due date bears interest as provided in Minnesota Statutes, section 270.75.

Subd. 2. [TOBACCO PRODUCTS.] A floor stocks tax is imposed on every person engaged in business in this state as a distributor of tobacco products, at the rate of 29 percent of the wholesale sales price of each tobacco product in the person's possession or under the person's control at 12:01 a.m. on July 1, 1998. Each distributor, by July 8, 1998, shall file a report with the commissioner, in the form the commissioner prescribes, showing the tobacco products on hand at 12:01 a.m. on July 1, 1998, and the amount of tax due on them. The tax imposed by this section, less the discount provided in Minnesota Statutes, section 297F.09, subdivision 2, is due and payable by August 1, 1998, and thereafter bears interest as provided in Minnesota Statutes, section 270.75.

Subd. 3. [AUDIT AND ENFORCEMENT.] The tax imposed by this section is subject to the audit, assessment, and collection provisions applicable to the taxes imposed under Minnesota Statutes, chapter 297F. The commissioner may require a distributor to receive and maintain copies of floor stock tax returns filed by all persons requesting a credit for returned cigarettes.

Subd. 4. [DEPOSIT OF PROCEEDS.] The revenue from the tax imposed under this section must be deposited by the commissioner in the health care access fund in the state treasury.

Sec. 12. [REPEALER.]

Minnesota Statutes 1997 Supplement, section 295.52, subdivision 7, is repealed.

Sec. 13. [EFFECTIVE DATE.]

Sections 1 to 5 and 12 are effective for calendar years beginning after December 31, 1997. Sections 6 to 11 are effective July 1, 1998."

Renumber the sections in sequence and correct internal references

Amend the title accordingly

A roll call was requested and properly seconded.

The Speaker resumed the Chair.

The question was taken on the Huntley et al amendment and the roll was called.

Winter moved that those not voting be excused from voting. The motion prevailed.

There were 43 yeas and 88 nays as follows:

Those who voted in the affirmative were:

Abrams	Evans	Huntley	Lieder	Orfield	Tuma
Biernat	Finseth	Johnson, R.	Long	Otremba, M.	Wagenius
Journal of the House - 89th Day - Wednesday, March 11, 1998 - Top of Page 8194
Bradley	Folliard	Juhnke	McGuire	Paymar	Wejcman
Chaudhary	Greenfield	Kahn	Mulder	Rhodes
Clark, K.	Greiling	Kalis	Munger	Schumacher
Dawkins	Haas	Koskinen	Ness	Sekhon
Dorn	Hasskamp	Kubly	Olson, E.	Skoglund
Entenza	Hausman	Leppik	Opatz	Tingelstad

Those who voted in the negative were:

Anderson, B.	Erickson	Knight	Molnau	Rifenberg	Tompkins
Anderson, I.	Farrell	Knoblach	Mullery	Rostberg	Trimble
Bakk	Garcia	Kraus	Murphy	Rukavina	Tunheim
Bettermann	Goodno	Krinkie	Nornes	Seagren	Van Dellen
Boudreau	Gunther	Kuisle	Olson, M.	Seifert	Vandeveer
Broecker	Harder	Larsen	Osskopp	Skare	Weaver
Carlson	Hilty	Leighton	Osthoff	Slawik	Wenzel
Clark, J.	Holsten	Lindner	Ozment	Smith	Westfall
Commers	Jaros	Macklin	Paulsen	Solberg	Westrom
Daggett	Jefferson	Mahon	Pawlenty	Stanek	Winter
Davids	Jennings	Mares	Pelowski	Stang	Wolf
Dehler	Johnson, A.	Mariani	Peterson	Sviggum	Workman
Delmont	Kelso	Marko	Pugh	Swenson, H.	Spk. Carruthers
Dempsey	Kielkucki	McElroy	Rest	Sykora
Erhardt	Kinkel	Milbert	Reuter	Tomassoni

The motion did not prevail and the amendment was not adopted.

Sviggum moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Page 109, line 17, strike "$19,910" and insert "$24,800" and strike "6" and insert "5.5"

Page 109, line 18, strike "$19,910" and insert "$24,800" and strike "$79,120" and insert "$98,540" and strike "8" and insert "7.5"

Page 109, line 19, strike "$79,120" and insert "$98,540"

Page 109, line 27, strike "$13,620" and insert "$16,960" and strike "6" and insert "5.5"

Page 109, line 28, strike "$13,620" and insert "$16,960" and strike "$44,750" and insert "$55,730" and strike "8" and insert "7.5"

Page 109, line 29, strike "$44,750" and insert "$55,730"

Page 109, line 34, strike "$16,770" and insert "$20,890" and strike "6" and insert "5.5"

Page 109, line 35, strike "$16,770" and insert "$20,890" and strike "$67,390" and insert "$83,930" and strike "8" and insert "7.5"

Page 109, line 36, strike "$67,390" and insert "$83,930"

Page 110, after line 34, insert:

"Sec. 8. Minnesota Statutes 1996, section 290.06, subdivision 2d, is amended to read:

as provided in this subdivision all of the rate brackets provided in subdivision 2c shall be the rate brackets as they existed for taxable years beginning after December 31, 1990 1997, and before January 1, 1992 1999. The rate applicable to any rate bracket must not be changed. The dollar amounts setting forth the tax shall be adjusted to reflect the changes in the rate brackets. The rate brackets as adjusted must be rounded to the nearest $10 amount. If the rate bracket ends in $5, it must be rounded up to the nearest $10 amount.

(b) The commissioner shall adjust the rate brackets and by the percentage determined pursuant to the provisions of section 1(f) of the Internal Revenue Code, except that in section 1(f)(3)(B) the word "1990 1997" shall be substituted for the word "1987." For 1991 1998, the commissioner shall then determine the percent change from the 12 months ending on August 31, 1990 1997, to the 12 months ending on August 31, 1991 1998, and in each subsequent year, from the 12 months ending on August 31, 1990 1998, to the 12 months ending on August 31 of the year preceding the taxable year. The determination of the commissioner pursuant to this subdivision shall not be considered a "rule" and shall not be subject to the administrative procedure act contained in chapter 14.

No later than December 15 of each year, the commissioner shall announce the specific percentage that will be used to adjust the tax rate brackets."

Page 114, after line 10, insert:

"Sec. 12. Minnesota Statutes 1996, section 290.091, subdivision 1, is amended to read:

Subdivision 1. [IMPOSITION OF TAX.] In addition to all other taxes imposed by this chapter a tax is imposed on individuals, estates, and trusts equal to the excess (if any) of

(a) an amount equal to seven 6.8 percent of alternative minimum taxable income after subtracting the exemption amount, over

(b) the regular tax for the taxable year."

Page 115, line 30, delete "seven" and insert "6.8"

Page 116, line 28, delete "seven" and insert "6.8"

Page 122, line 23, after "(1)" insert "and the changes in the rates and brackets"

Page 122, line 24, delete "is" and insert "are"

Page 122, line 26, before the semicolon, insert "and paragraph (c)"

Page 122, line 27, after the second comma, insert "the rate change in clause (2),"

Page 122, line 31, after the period, insert "Section 8 is effective for tax years beginning after December 31, 1998. Section 12 is effective for tax years beginning after December 31, 1997."

Renumber the sections in sequence and correct internal references

Amend the title accordingly

A roll call was requested and properly seconded.

Winter moved that those not voting be excused from voting. The motion prevailed.

There were 65 yeas and 67 nays as follows:

Those who voted in the affirmative were:

Abrams	Dehler	Kielkucki	McElroy	Rhodes	Tingelstad
Anderson, B.	Dempsey	Knight	Molnau	Rifenberg	Tompkins
Bettermann	Erhardt	Knoblach	Mulder	Rostberg	Tuma
Bishop	Erickson	Kraus	Ness	Seagren	Van Dellen
Boudreau	Farrell	Krinkie	Nornes	Seifert	Vandeveer
Bradley	Finseth	Kuisle	Olson, M.	Smith	Weaver
Broecker	Goodno	Larsen	Osskopp	Stanek	Westfall
Clark, J.	Gunther	Leppik	Ozment	Stang	Westrom
Commers	Haas	Lindner	Paulsen	Sviggum	Wolf
Daggett	Harder	Macklin	Pawlenty	Swenson, H.	Workman
Davids	Holsten	Mares	Reuter	Sykora

Those who voted in the negative were:

Anderson, I.	Garcia	Juhnke	Marko	Pelowski	Trimble
Bakk	Greenfield	Kahn	McCollum	Peterson	Tunheim
Biernat	Greiling	Kalis	McGuire	Pugh	Wagenius
Carlson	Hasskamp	Kelso	Milbert	Rest	Wejcman
Chaudhary	Hausman	Kinkel	Mullery	Rukavina	Wenzel
Clark, K.	Hilty	Koskinen	Munger	Schumacher	Winter
Dawkins	Huntley	Kubly	Murphy	Sekhon	Spk. Carruthers
Delmont	Jaros	Leighton	Olson, E.	Skare
Dorn	Jefferson	Lieder	Opatz	Skoglund
Entenza	Jennings	Long	Orfield	Slawik
Evans	Johnson, A.	Mahon	Otremba, M.	Solberg
Folliard	Johnson, R.	Mariani	Paymar	Tomassoni

The motion did not prevail and the amendment was not adopted.

Abrams moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Pages 209 and 210, delete section 24

A roll call was requested and properly seconded.

The question was taken on the Abrams amendment and the roll was called.

Winter moved that those not voting be excused from voting. The motion prevailed.

There were 54 yeas and 75 nays as follows:

Those who voted in the affirmative were:

Abrams	Daggett	Knoblach	Mulder	Reuter	Sviggum
Anderson, B.	Davids	Kraus	Murphy	Rhodes	Swenson, H.
Bettermann	Dehler	Krinkie	Ness	Rifenberg	Tompkins
Bishop	Erhardt	Kuisle	Nornes	Rostberg	Tuma
Boudreau	Finseth	Larsen	Olson, M.	Seagren	Van Dellen
Bradley	Gunther	Leppik	Osskopp	Skare	Vandeveer
Journal of the House - 89th Day - Wednesday, March 11, 1998 - Top of Page 8197
Broecker	Harder	Lindner	Ozment	Smith	Westfall
Clark, J.	Kielkucki	McElroy	Paulsen	Stanek	Wolf
Commers	Knight	Molnau	Pawlenty	Stang	Workman

Those who voted in the negative were:

Anderson, I.	Folliard	Jennings	Macklin	Osthoff	Tomassoni
Bakk	Garcia	Johnson, A.	Mahon	Otremba, M.	Trimble
Biernat	Goodno	Johnson, R.	Mares	Pelowski	Tunheim
Carlson	Greenfield	Juhnke	Mariani	Peterson	Wagenius
Chaudhary	Greiling	Kahn	Marko	Pugh	Weaver
Clark, K.	Haas	Kalis	McCollum	Rest	Wejcman
Dawkins	Hasskamp	Kelso	McGuire	Rukavina	Wenzel
Delmont	Hausman	Kinkel	Milbert	Schumacher	Westrom
Dorn	Hilty	Koskinen	Mullery	Seifert	Winter
Entenza	Holsten	Kubly	Munger	Sekhon	Spk. Carruthers
Erickson	Huntley	Leighton	Olson, E.	Slawik
Evans	Jaros	Lieder	Opatz	Solberg
Farrell	Jefferson	Long	Orfield	Tingelstad

The motion did not prevail and the amendment was not adopted.

Westrom; Milbert; Bettermann; McElroy; Kuisle; Lieder; Olson, E.; Wenzel and Westfall moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Page 217, after line 10, insert:

Section 1. [LEGISLATIVE PURPOSE AND POLICY.]

The legislature determines that in the cities of Farwell and Kensington there are serious problems of water pollution and disposal of sewage which cannot be effectively or economically dealt with by existing government units under existing laws. The legislature, therefore, declares that for the protection of the public health, safety, and welfare of these areas, for the preservation and best use of waters and other natural resources of the state in the area, for the prevention, control, and abatement of water pollution in the area, and for the efficient and economic collection, treatment, and disposal of sewage, it is necessary to establish in Minnesota for said area a sanitary sewer board.

Sec. 2. [DEFINITIONS.]

Subdivision 1. [APPLICATION.] The terms defined in this section shall have the meaning given them unless otherwise provided or indicated by the context.

Subd. 2. [ACQUISITION AND BETTERMENT.] "Acquisition" and "betterment" shall have the meanings given them in Minnesota Statutes, chapter 475.

Subd. 3. [AGENCY.] "Agency" means the Minnesota pollution control agency created and established by Minnesota Statutes, chapter 116.

Subd. 5. [CURRENT COSTS OF ACQUISITION, BETTERMENT, AND DEBT SERVICE.] "Current costs of acquisition, betterment, and debt service" means interest and principal estimated to be due during the budget year on bonds issued to finance said acquisition and betterment and all other costs of acquisition and betterment estimated to be paid during such year from funds other than bond proceeds and federal or state grants.

Subd. 6. [DISTRICT DISPOSAL SYSTEM.] "District disposal system" means any and all of the interceptors or treatment works owned, constructed, or operated by the board unless designated by the board as local sanitary sewer facilities.

Subd. 7. [FARWELL-KENSINGTON SANITARY DISTRICT AND DISTRICT.] "Farwell-Kensington sanitary district" and "district" mean the area over which the sanitary sewer board has jurisdiction which shall include all that part of Douglas county and Pope county described as follows, to wit:

(1) all of the land within the corporate limits of the city of Farwell;

(2) all of the land within the corporate limits of the city of Kensington.

Subd. 8. [INTERCEPTOR.] "Interceptor" means any sewer and necessary appurtenances thereto, including but not limited to, mains, pumping stations, and sewage flow regulating and measuring stations, which is designed for or used to conduct sewage originating in more than one local government unit, or which is designed or used to conduct all or substantially all the sewage originating in a single local government unit from a point of collection in that unit to an interceptor or treatment works outside that unit, or which is determined by the board to be a major collector of sewage used or designed to serve a substantial area in the district.

Subd. 9. [LOCAL GOVERNMENT UNIT OR GOVERNMENT UNIT.] "Local government unit" or "government unit" means any municipal or public corporation or governmental or political subdivision or agency located in whole or in part in the district, authorized by law to provide for the collection and disposal of sewage.

Subd. 10. [LOCAL SANITARY SEWER FACILITIES.] "Local sanitary sewer facilities" means all or any part of any disposal system in the district other than the district disposal system.

Subd. 11. [MUNICIPALITY.] "Municipality" means any city or town located in whole or in part in the district.

Subd. 12. [PERSON.] "Person" means any individual, partnership, corporation, cooperative, or other organization or entity, public or private.

Subd. 13. [POLLUTION AND SEWAGE SYSTEM.] "Pollution" and "sewage system" shall have the meanings given them in Minnesota Statutes, section 115.01.

Subd. 14. [SANITARY SEWER BOARD OR BOARD.] "Sanitary sewer board" or "board" means the sanitary sewer board established for the Farwell-Kensington sanitary district as provided in section 3.

Subd. 15. [SEWAGE.] "Sewage" means all liquid or water-carried waste products from whatever sources derived, together with such groundwater infiltration and surface water as may be present.

Subd. 16. [TOTAL COSTS OF ACQUISITION AND BETTERMENT AND COSTS OF ACQUISITION AND BETTERMENT.] "Total costs of acquisition and betterment" and "costs of acquisition and betterment" mean all acquisition and betterment expenses which are permitted to be financed out of bond proceeds issued in accordance with section 13, subdivision 4, whether or not such expenses are in fact financed out of such bond proceeds.

Sec. 3. [SANITARY SEWER BOARD.]

Subdivision 1. [ESTABLISHMENT.] A sanitary sewer board with jurisdiction in the Farwell-Kensington sanitary district is established as a public corporation and political subdivision of the state with perpetual succession and all the rights, powers, privileges, immunities, and duties which may be validly granted to or imposed upon a municipal corporation, as provided in this article.

Subd. 2. [NUMBER, TERMS, AND ELECTION OF MEMBERS.] The board has five members, two elected at large from the city of Farwell and three elected at large from the city of Kensington. The terms of the members are four years and until a successor is qualified, except that for the first election in 1998 one at large seat from Farwell and one from Kensington shall be for two years and until a successor is qualified. The short term shall be determined by lot and designated before filings open by the municipal clerks of the two cities. The election shall be conducted by the municipal clerks as provided in Minnesota Statutes, chapter 205, at the same time as the city council elections are held. Vacancies, removal, and qualification for office are as otherwise provided by statute for elected city council members.

Subd. 3. [CERTIFICATES OF SELECTION, OATH OF OFFICE.] A certificate of selection of every board member selected under subdivision 2 stating the term shall be made by the respective municipal clerks. The certificates, with the approval appended by other authority, if required, shall be filed with the secretary of state. Counterparts shall be furnished to the board member and the secretary of the board. Each member shall qualify by taking and subscribing the oath of office prescribed by the Minnesota Constitution, article V, section 6. Such oath, duly certified by the official administering the same, shall be filed with the secretary of state and the secretary of the board.

Subd. 4. [COMPENSATION OF BOARD MEMBERS.] Each board member shall be paid a per diem compensation for meetings and for such other services in such amount as may be specifically authorized by the board from time to time. Per diem compensation shall not exceed $2,000 in any one year. All members of the board shall be reimbursed for all reasonable expenses incurred in the performance of their duties as determined by the board.

Sec. 4. [GENERAL PROVISIONS FOR ORGANIZATION AND OPERATION OF BOARD.]

Subdivision 1. [OFFICERS, MEETINGS, SEAL.] A majority of the members shall constitute a quorum at all meetings of the board, but a lesser number may meet and adjourn from time to time and compel the attendance of absent members. The board shall meet regularly at such time and place as the board shall by resolution designate. Special meetings may be held at any time upon call of the chair or any two members, upon written notice sent by mail to each member at least three days prior to the meeting, or upon such other notice as the board by resolution may provide, or without notice if each member is present or files with the secretary a written consent to the meeting either before or after the meeting. Except as otherwise provided in this article, any action within the authority of the board may be taken by the affirmative vote of a majority of the board at a regular or adjourned regular meeting or at a duly held special meeting, but in any case only if a quorum is present. All meetings of the board shall be open to the public as provided in Minnesota Statutes, section 471.705. The board may adopt a seal, which shall be officially and judicially noticed, to authenticate instruments executed by its authority, but omission of the seal shall not affect the validity of any instrument.

Subd. 2. [CHAIR.] The board shall elect a chair from its membership. The term of the chair shall expire on January 1 of each year. The chair shall preside at all meetings of the board, if present, and shall perform all other duties and functions usually incumbent upon such an officer, and all administrative functions assigned to the chair by the board. The board shall elect a vice-chair from its membership to act for the chair during a temporary absence or disability.

Subd. 4. [GENERAL MANAGER.] The board may appoint a general manager who shall be selected solely upon the basis of training, experience, and other qualifications and who shall serve at the pleasure of the board and at a compensation to be determined by the board. The general manager need not be a resident of the district and may also be selected by the board to serve as either secretary or treasurer, or both, of the board. The general manager shall attend all meetings of the board, but shall not vote, and shall:

(1) see that all resolutions, rules, regulations, or orders of the board are enforced;

(2) appoint and remove, upon the basis of merit and fitness, all subordinate officers and regular employees of the board except the secretary and the treasurer and their deputies;

(3) present to the board plans, studies, and other reports prepared for board purposes and recommend to the board for adoption such measures as the general manager deems necessary to enforce or carry out the powers and duties of the board, or the efficient administration of the affairs of the board;

(4) keep the board fully advised as to its financial condition, and prepare and submit to the board, and to the governing bodies of the local government units, the board's annual budget and such other financial information as the board may request;

(5) recommend to the board for adoption such rules and regulations as he or she deems necessary for the efficient operation of a district disposal system and all local sanitary sewer facilities over which the board may assume responsibility as provided in section 18; and

(6) perform such other duties as may be prescribed by the board.

Subd. 5. [PUBLIC EMPLOYEES.] The general manager and all persons employed by the general manager shall be public employees, and shall have all the rights and duties conferred on public employees under Minnesota Statutes, sections 179A.01 to 179A.25. The compensation and conditions of employment of such employees shall not be governed by any rule applicable to state employees in the classified service nor to any of the provisions of Minnesota Statutes, chapter 15A, unless the board so provides.

Subd. 6. [PROCEDURES.] The board shall adopt resolutions or bylaws establishing procedures for board action, personnel administration, recordkeeping, investment policy, approving claims, authorizing or making disbursements, safekeeping funds, and audit of all financial operations of the board.

Subd. 7. [SURETY BONDS AND INSURANCE.] The board may procure surety bonds for its officers and employees and in such amounts as are deemed necessary to assure proper performance of their duties and proper accounting for funds in their custody. It may procure insurance against such risks to property and such liability of the board and its officers, agents, and employees for personal injuries or death and property damage and destruction and in such amounts as may be deemed necessary or desirable, with the force and effect stated in Minnesota Statutes, chapter 466.

Sec. 5. [COMPREHENSIVE PLAN.]

Subd. 2. [COMPREHENSIVE PLANS; HEARING.] Before adopting any subsequent comprehensive plan the board shall hold a public hearing on such proposed plan at such time and place in the district as it shall determine. The hearing may be continued from time to time. Not less than 45 days before the hearing, the board shall publish notice thereof in a newspaper or newspapers having general circulation in the district, stating the date, time, and place of the hearing, and the place where the proposed plan may be examined by any interested person. At the hearing, all interested persons shall be permitted to present their views on the plan.

Subd. 3. [MUNICIPAL PLANS AND PROGRAMS; COORDINATION WITH BOARD'S RESPONSIBILITIES.] Before undertaking the construction of new sewers of other disposal facilities or the substantial alteration or improvement of any existing sewers or other disposal facilities, each local government unit may, and shall if the construction or alteration of any sewage disposal facilities is contemplated by such government unit, adopt a comprehensive plan and program for the collection, treatment, and disposal of sewage for which the local government unit is responsible, coordinated with the board's comprehensive plan, and may revise the same as often as deems necessary. Each such local plan or revision thereof shall be submitted forthwith to the board for review and shall be subject to the approval of the board as to those features of the plan affecting the board's responsibilities as determined by the board. Any such features disapproved by the board shall be modified in accordance with the board's recommendations. No construction project involving such features shall be undertaken by the local government unit unless its governing body shall first find the project to be in accordance with the government unit's comprehensive plan and program as approved by the board. Prior to approval by the board of the comprehensive plan and program of any local government unit in the district, no construction project shall be undertaken by such government unit unless approval of the project is first secured from the board as to those features of the project affecting the board's responsibilities as determined by the board.

Sec. 6. [SEWER SERVICE FUNCTION.]

Subdivision 1. [DUTY OF BOARD; ACQUISITION OF EXISTING FACILITIES; NEW FACILITIES.] At any time after the board has become organized it shall assume ownership of all existing interceptors and treatment works which will be needed to implement the board's comprehensive plan for the collection, treatment, and disposal of sewage in the district, in the manner and subject to the conditions prescribed in subdivision 2, and shall design, acquire, construct, better, equip, operate, and maintain all additional interceptors and treatment works which will be needed for such purpose. The board shall assume ownership of all treatment works owned by a local government unit if any part of such treatment works will be needed for such purpose.

Subd. 2. [METHOD OF ACQUISITION; EXISTING DEBT.] The board may require any local government unit to transfer to the board, all of its right, title, and interest in any interceptors or treatment works and all necessary appurtenances thereto owned by such local government unit which will be needed for the purpose stated in subdivision 1. Appropriate instruments of conveyance for all such property shall be executed and delivered to the board by the proper officers of each local government unit concerned. The board, upon assuming ownership of any such interceptors or treatment works, shall become obligated to pay to such local government unit amounts sufficient to pay when due all remaining principal of and interests on bonds issued by such local government unit for the acquisition or betterment of the interceptors or treatment works taken over. The board shall also assume the same obligation with respect to so much of any other existing disposal system owned by a local government unit as the board determines to have been replaced or rendered useless by the district disposal system. The amounts to be paid under this subdivision may be offset against any amount to be paid to the board by the local government unit as provided in section 9. The board shall not be obligated to pay the local government unit anything in addition to the assumption of debt herein provided for.

all subsequent collections of taxes, special assessments, or service charges or any other sums due the joint powers board or levied, or imposed by or for such joint powers board shall be transferred to or made payable to the sanitary sewer board and the county auditor shall remit the sums to the board. The local government units otherwise entitled to such cash, taxes, assessments, or service charges shall be credited with such amounts, and such credits shall be offset against any amounts to be paid by them to the board as provided in section 9. On January 1, 2000, or such earlier date, the board shall succeed to and become vested with all right, title, and interest in and to any property, real or personal, owned or operated by such joint powers board; and prior to that date the proper officers of such joint powers board shall execute and deliver to the sanitary sewer board all deeds, conveyances, bills of sale, and other documents or instruments required to vest in the board good and marketable title to all such real or personal property, but this article shall operate as such transfer and conveyance to the board of such real or personal property, if not so transferred, as may be required under the law or under the circumstances. On January 1, 2000, or such earlier date, the board shall become obligated to pay or assume all outstanding bonds or other debt and all contracts or obligations incurred by such joint powers board, and all such bonds, obligations, or debts of the joint powers board outstanding on the date this article becomes effective are validated.

Subd. 4. [CONTRACTS BETWEEN LOCAL GOVERNMENT UNITS.] The board may terminate upon 60 days mailed notice to the contracting parties, any existing contract between or among local government units requiring payments by a local government unit to any other local government unit, for the use of a disposal system, or as reimbursement of capital costs of such a disposal system, all or part of which will be needed to implement the board's comprehensive plan. All contracts between or among local government units for use of a disposal system entered into subsequent to the date on which this article becomes effective shall be submitted to the board for approval as to those features affecting the board's responsibilities as determined by the board and shall not become effective until such approval is given.

Sec. 7. [SEWAGE COLLECTION AND DISPOSAL; POWERS.]

Subdivision 1. [POWERS.] In addition to all other powers conferred upon the board in this article, the board has the powers specified in this section.

Subd. 2. [DISCHARGE OF TREATED SEWAGE.] The board shall have the right to discharge the effluent from any treatment works operated by it into any waters of the state, subject to approval of the agency if required and in accordance with any effluent or water quality standards lawfully adopted by the agency, any interstate agency or any federal agency having jurisdiction.

Subd. 3. [UTILIZATION OF DISTRICT SYSTEM.] The board may require any person or local government unit to provide for the discharge of any sewage, directly or indirectly, into the district disposal system, or to connect any disposal system or a part thereof with the district disposal system wherever reasonable opportunity therefore is provided; may regulate the manner in which such connections are made; may require any person or local government unit discharging sewage into the disposal system to provide preliminary treatment therefore; may prohibit the discharge into the district disposal system of any substance which it determines will or may be harmful to the system or any persons operating it; may prohibit any extraneous flow into the system; and may require any local government unit to discontinue the acquisition, betterment, or operation of any facility for such unit's disposal system wherever and so far as adequate service is or will be provided by the district disposal system.

Sec. 8. [BUDGET.]

Except as otherwise specifically provided in this article, the board is subject to Minnesota Statutes, section 275.065, popularly known as the Truth in Taxation Act. The board shall prepare and adopt, on or before September 15 of each year, a budget showing for the following calendar year or other fiscal year determined by the board, sometimes referred to in this article as the budget year, estimated receipts of money from all sources including, but not limited to, payments by each local government unit, federal or state grants, taxes on property, and funds on hand at the beginning of the year, and estimated expenditures for:

(1) costs of operation, administration, and maintenance of the district disposal system;

(3) debt service, including principal and interest, on general obligation bonds and certificates issued pursuant to section 13, obligations and debts assumed under section 6, subdivisions 2 and 3, and any money judgments entered by a court of competent jurisdiction.

Expenditures within these general categories, and such others as the board may from time to time determine, shall be itemized in such detail as the board shall prescribe. The board and its officers, agents, and employees shall not spend money for any purpose other than debt service without having set forth such expense in the budget nor in excess of the amount set forth in the budget therefor, and no obligation to make sure an expenditure shall be enforceable except as the obligation of the person or persons incurring it; provided that the board may amend the budget at any time by transferring from one purpose to another any sums except money for debt service and bond proceeds or by increasing expenditures in any amount by which cash receipts during the budget year actually exceed the total amounts designated in the original budget. The creation of any obligation pursuant to section 13 or the receipts of any federal or state grant is a sufficient budget designation of the proceeds for the purpose for which it is authorized, and of the tax or other revenue pledged to pay the obligation and interest on it, whether or not specifically included in any annual budget.

Sec. 9. [ALLOCATION OF COSTS.]

Subdivision 1. [DEFINITION OF CURRENT COSTS.] The estimated cost of administration, operation, maintenance, and debt service of the district disposal system to be paid by the board in each fiscal year and the estimated costs of acquisition and betterment of the system which are to be paid during the year from funds other than state or federal grants and bond proceeds and all other previously unallocated payments made by the board pursuant to this article in such year are referred to as current costs.

Subd. 2. [COLLECTION OF CURRENT COSTS.] Current costs shall be collected as follows:

(a) Allocation of current costs: current costs may be allocated to local government units in the district on an equitable basis as the board may from time to time determine by resolution to be fair and reasonable and in the best interests of the district. In making the allocation the board may provide for the deferment of payment of all or part of current costs, the reallocation of deferred costs and the reimbursement of reallocated deferred costs on an equitable basis as the board may from time to time determine by resolution to be fair and reasonable and in the best interests of the district. The adoption or revision of a method of allocation, deferment, reallocation, or reimbursement used by the board shall be made by the affirmative vote of at least two-thirds of the members of the board.

(b) Direct collection: upon approval of at least two-thirds of the members of the board, the board may provide for direct collection of current costs by monthly or other periodic billing of sewer users.

Sec. 10. [GOVERNMENT UNITS; PAYMENTS TO BOARD.]

Subdivision 1. [OBLIGATIONS OF GOVERNMENT UNITS TO THE BOARD.] Each government unit shall pay to the board all sums charged to it as provided in section 9, at the times and in the manner determined by the board. The governing body of each such government unit shall take all action that may be necessary to provide the funds required for such payments and to make the same when due.

Subd. 2. [AMOUNTS DUE BOARD; WHEN PAYABLE.] Charges payable to the board by local government units may be made payable at such times during each year as the board determines, after it has taken into account the dates on which taxes, assessments, revenue collections, and other funds become available to the government unit required to pay such charges.

levy additional taxes on the entire net tax capacity of all taxable property for all or a part of the balance remaining payable. The taxes levied under this subdivision shall be assessed and extended as a tax upon such taxable property by the county auditor for the next calendar year, free from any limitation of rate or amount imposed by law or charter. The tax shall be collected and remitted in the same manner as other general taxes of the government unit.

Subd. 3a. [ALTERNATE LEVY.] In lieu of levying taxes on all taxable property pursuant to subdivision 3, the governing body of the government unit may elect to levy taxes upon the net tax capacity of all taxable property, except agricultural property, and upon only 25 percent of the net tax capacity of all agricultural property, in that part of the government unit located in the district for all or a part of the amounts payable to the board. If the levy is for only part of the amounts payable to the board, the governing body may levy additional taxes on the entire net tax capacity of all such property, including agricultural property, for all or a part of the balance of such amounts. The taxes shall be assessed and extended as a tax upon such taxable property by the county auditor for the next calendar year, free from any limitation of rate or amount imposed by law or charge, and shall be collected and remitted in the same manner as other general taxes of the government unit. In computing the tax capacity pursuant to this subdivision, the county auditor shall include only 25 percent of the net tax capacity of all taxable agricultural property and 100 percent of the net tax capacity of all other taxable property in that part of the government unit located within the district and, in spreading the levy, the auditor shall apply the mill rate upon the same percentages of agricultural and nonagricultural taxable property. If the government unit elects to levy taxes under this subdivision and any of the taxable agricultural property is reclassified so as to no longer qualify as agricultural property, it shall be subject to additional taxes. The additional taxes shall be in an amount which, together with any such additional taxes previously levied and the estimated collection of additional taxes subsequently levied on any other such reclassified property, is determined by the governing body of the government unit to be at least sufficient to reimburse each other government unit for any excess current costs reallocated to it as a result of the board deferring any current costs under section 9 on account of the difference between the amount of such current costs initially allocated to each government unit based on the total net tax capacity of all taxable property in the district and the amount of such current costs reallocated to each government unit based on 25 percent of the net tax capacity of agricultural property and 100 percent of the net tax capacity of all other taxable property in the district. Any reimbursement shall be made on terms which the board determines to be just and reasonable. These additional taxes may be levied in any greater amount as the governing body of the government unit determines to be appropriate, provided that in no event shall the total amount of the additional taxes exceed the difference between:

(1) the total amount of taxes which would have been levied upon such reclassified property to help pay current costs charged in each year to the government unit by the board if that portion of such costs, if any, initially allocated by the board solely on the basis of 100 percent of the net tax capacity of all taxable property in the district and then reallocated on the basis of inclusion of only 25 percent of the net tax capacity of agricultural property in the district was not reallocated and if the amount of taxes levied by the government unit each year under this subdivision to pay current costs had been based on such initial allocation and had been imposed upon 100 percent of the net tax capacity of all taxable property, including agricultural property, in that part of the government unit located in the district; and

(2) the amount of taxes theretofore levied each year under this subdivision upon such reclassified property, plus interest on the cumulative amount of such difference accruing each year at the approximate average annual rate borne by bonds issued by the board and outstanding at the beginning of such year or, if no bonds are then outstanding, at such rate of interest which may be determined by the board, but not exceeding the maximum rate of interest which may then be paid on bonds issued by the board. The additional taxes shall be a lien upon the reclassified property assessed in the same manner and for the same duration as all other ad valorem taxes levied upon the property. The additional taxes shall be extended against the reclassified property on the tax list for the current year, provided however that no penalties or additional interest shall be levied on such additional taxes if timely paid, and shall be collected and remitted in the same manner as other general taxes of the government unit.

Subd. 4. [DEBT LIMIT.] Any ad valorem taxes levied under section 10, subdivision 3, or section 5 by the governing body of a government unit to pay any sums charged to it by the board pursuant to this article are not subject to, or counted towards, any limit imposed by law on the levy of taxes upon taxable property within any governmental unit.

taxable property in that part of the government unit located in the district, for the next calendar year, free from any limitation imposed by law or charter. Such tax shall be collected in the same manner as other general taxes of the government unit, and the proceeds thereof, when collected, shall be paid by the county treasurer to the treasurer of the board and credited to the government unit for which the tax was levied.

Sec. 11. [PUBLIC HEARING AND SPECIAL ASSESSMENTS.]

Subdivision 1. [PUBLIC HEARING REQUIREMENT ON SPECIFIC PROJECT.] Before the board orders any project involving the acquisition or betterment of any interceptor or treatment works, all or a part of the cost of which will be allocated to local government units pursuant to section 9, as current costs, the board shall hold a public hearing on the proposed project following two publications in a newspaper or newspapers having general circulation in the district, stating the time and place of the hearing, the general nature and location of the project, the estimated total cost of acquisition and betterment, that portion of such costs estimated to be paid out of federal and state grants, and that portion of such costs estimated to be allocated to each local government unit affected thereby. The two publications shall be a week apart and the hearing shall be at least three days after the last publication. Not less than 45 days before the hearing notice thereof shall also be mailed to each clerk of all local government units in the district, but failure to give mailed notice of any defects in the notice shall not invalidate the proceedings. The project may include all or part of one or more interceptors or treatment works. A hearing is not required with respect to a project, no part of the costs of which are to be allocated to local government units as the current costs of acquisition, betterment, and debt service.

Subd. 2. [NOTICE TO BENEFITED PROPERTY OWNERS.] If the governing body of any local government unit in the district proposes to assess against benefited property within such units all or any part of the allocable costs of the project as provided in subdivision 5, such governing body shall, not less than ten days prior to the hearing provided for in subdivision 1 cause mailed notice thereof to be given to the owner of each parcel within the area proposed to be specially assessed and shall also give one week's published notice of the hearing. The notice of hearing shall contain the same information provided in the notice published by the board pursuant to subdivision 1, and in addition, a description of the area proposed to be assessed by the local government unit. For the purpose of giving mailed notice, owners shall be those shown to be on the records of the county auditor or, in any county where tax statements are mailed by the county treasurer, on the records of the county treasurer; but other appropriate records may be used for this purpose. However, as to properties which are tax exempt or subject to taxation on a gross earnings basis and are not listed on the records of the county auditor or the county treasurer, the owners thereof shall be ascertained by any practicable means and mailed notice shall be given them as herein provided. Failure to give mailed notice or any defects in the notice shall not invalidate the proceedings of the board or the local governing body.

Subd. 3. [BOARD PROCEEDINGS PERTAINING TO HEARING.] Prior to adoption of the resolution calling for such a hearing, the board shall secure from the district engineer or some other competent person of the board's selection a report advising it in a preliminary way as to whether the proposed project is feasible, necessary, and cost effective and as to whether it should best be made as proposed or in connection with some other project and the estimated costs of the project as recommended; but no error or omission in such report shall invalidate the proceeding. The board may also take such other steps prior to the hearing, as well in its judgment provide helpful information in determining the desirability and feasibility of the project including, but not limited to, preparation of plans and specifications and advertisement for bids thereon. The hearing may be adjourned from time to time and a resolution ordering the project may be adopted at any time within six months after the date of hearing. In ordering the project the board may reduce but not increase the extent of the project as stated in the notice of hearing, unless another hearing is held, and shall find that the project as ordered is in accordance with the comprehensive plan and program adopted by the board pursuant to section 5.

Subd. 5. [POWER OF GOVERNMENT UNIT TO SPECIALLY ASSESS.] A local government unit may specially assess all or any part of the costs of acquisition and betterment as herein provided, of any project ordered by the board pursuant to this section. Such special assessments shall be levied in accordance with Minnesota Statutes, sections 429.051 to 429.081, except as otherwise provided in this subdivision. No other provisions of Minnesota Statutes, chapter 429, shall apply. For purposes of levying such special assessments, the hearing on such project required in subdivision 1 shall serve as the hearing on the making of the original improvement provided for by Minnesota Statutes, section 429.051. The area assessed may be less than but may not exceed the area proposed to be assessed as stated in the notice of hearing on the project provided for in subdivision 2. For the purpose of determining the allocable cost of the project, or part thereof, to the local government unit, the government unit may adopt one of the following procedures.

(a) At any time after a contract is let for the project, the local government unit may obtain from the board a current written estimate, on the basis of such historical and reasonably projected data as may be available, of that part of the total costs of acquisition and betterment of such project or of some portion of the project which the government unit shall designate, which will be allocated to the government unit and the number of years over which such costs will be allocated as current costs of acquisition, betterment, and debt service pursuant to section 9. The board shall not in any way be bound by this estimate for the purpose of allocating the costs of such project to local government units.

(b) The governing body may obtain from the board a written statement setting forth, for such prior period as the governing body designates, that portion of the costs previously allocated to the local government unit as current costs of acquisition, betterment, and debt service only, of all or any part of the project designated by the governing body. In addition to the allocable costs so ascertained, the local government unit may include in the total expense it will pay, as a basis for levying assessments, all other expenses incurred directly by the government unit in connection with said project, or any part thereof. Special assessments levied by the government unit with respect to previously allocated costs ascertained under this paragraph shall be payable in equal annual installments extending over a period not exceeding by more than one year the number of years which such costs have been allocated to the government unit or the estimated useful life of said project, or part thereof, whichever number of years is the lesser. No limitation is placed upon the number of times the governing body of a government unit may assess such previously allocated costs not previously assessed by the government unit. The power to specially assess provided for in this section shall be in addition and supplemental to all other powers of government units to levy special assessments.

Sec. 12. [INITIAL COSTS.]

Subdivision 1. [CONTRIBUTIONS OR ADVANCES FROM LOCAL GOVERNMENT UNITS.] The board may, at such time as it deems necessary and proper, request from all or some of the local government units necessary money to defray the costs of any obligations assumed under section 6 and the costs of administration, operation, and maintenance. Before making such request, the board shall, by formal resolution, determine the necessity for such money, setting forth in such resolution the purposes for which such money is needed and the estimated amount for each such purpose. Upon receiving such request, the governing body of each such government unit may provide for payment of the amount requested or such part thereof as it deems fair and reasonable. Such money may be paid out of general revenue funds or any other available funds of any local government unit and the governing bodies thereof may levy taxes to provide funds therefor, free from any existing limitations imposed by law or charter. Such money may be provided by such government units with or without interest but if interest is charged it shall not exceed five percent per annum. The board shall credit the local government units for such payments in allocating current costs pursuant to section 9, on such terms and at such times as it may agree with the unit furnishing the same.

Subd. 2. [LIMITED TAX LEVY.] The board may levy ad valorem taxes on all taxable property in the district to defray any of the costs described in subdivision 1, provided that such costs have not been defrayed by contribution under subdivision 1.

Sec. 13. [BONDS, CERTIFICATES, AND OTHER OBLIGATIONS.]

Subdivision 1. [BUDGET ANTICIPATION CERTIFICATES OF INDEBTEDNESS.] (a) At any time or times after adoption of its annual budget and in anticipation of the collection of tax and other revenues estimated and set forth by the board in such budget, except:

(1) taxes already anticipated by the issuance of certificates under subdivision 2;

(2) deficiency taxes levied pursuant to this subdivision; and

(3) taxes levied for the payment of certificates issued pursuant to subdivision 3, the board may by resolution, authorize the issuance, negotiation, and sale in accordance with subdivision 5 in such form and manner and upon such terms as it may determine of its negotiable general obligation certificates of indebtedness in aggregate principal amounts not exceeding 50 percent of the total amount of such tax collections and other revenues and maturing not later than three months after the close of the budget year in which issued. The proceeds of the sale of such certificates shall be used solely for the purposes for which such tax collections and other revenues are to be expended pursuant to such budget.

(b) All such tax collections and other revenues included in the budget for such budget year, after the expenditures of such tax collections and other revenues in accordance with the budget, shall be irrevocably pledged and appropriated to a special fund to pay the principal and interest on the certificates when due. If for any reason such tax collections and other revenues are insufficient to pay the certificates and interest when due, the board shall levy a tax in the amount of the deficiency on all taxable property in the district and shall appropriate this amount when received to the special fund.

Subd. 2. [TAX LEVY ANTICIPATION CERTIFICATES OF INDEBTEDNESS.] At any time or times after a tax is levied by the board pursuant to section 12, subdivision 2, and certified to the county auditors in anticipation of the collection of such tax, provided that such tax has not been anticipated by the issuance of certificates under subdivision 1, the board may, by resolution, authorize the issuance, negotiation, and sale in accordance with subdivision 5 in such form and manner and upon such terms and conditions as it may determine of its negotiable general obligation tax levy anticipation certificates of indebtedness in aggregate principal amounts not exceeding 50 percent of such uncollected tax as to which no penalty for nonpayment or delinquency has attached. Such certificates shall mature not later than April 1 in the year following the year in which such tax is collectible. The proceeds of the tax in anticipation of which such certificates were issued and other funds which may become available shall be applied to the extent necessary to repay such certificates.

Subd. 3. [EMERGENCY CERTIFICATES OF INDEBTEDNESS.] If in any budget year the receipts of tax and other revenues should for some unforeseen cause become insufficient to pay the board's current expenses, or if any calamity or other public emergency should subject it to the necessity of making extraordinary expenditures, the board may by resolution authorize the issuance, negotiation, and sale in accordance with subdivision 5 in such form and manner and upon such terms and conditions as it may determine of its negotiable general obligation certificates of indebtedness in an amount sufficient to meet such deficiency, and the board shall forthwith levy on all taxable property in the district a tax sufficient to pay the certificates and interest thereon and shall appropriate all collections of such tax to a special fund created for the payment of such certificates and the interest thereon.

Subd. 5. [MANNER OF SALE AND ISSUANCE OF CERTIFICATES.] Certificates issued under subdivisions 1, 2, and 3 may be issued and sold by negotiation, without public sale, and may be sold at a price equal to such percentage of the par value thereof, plus accrued interest, and bearing interest at such rate or rates as may be determined by the board. No election shall be required to authorize the issuance of such certificates. Such certificates shall bear the same rate of interest after maturity as before and the full faith and credit and taxing power of the board shall be pledged to the payment of such certificates.

Sec. 14. [TAX LEVIES.]

The board shall have power to levy taxes for the payment of bonds or other obligations assumed by the district under section 6 and for debt service of the district disposal system authorized in section 13 upon all taxable property within the district without limitation of rate or amount and without affecting the amount or rate of taxes which may be levied by the board for other purposes or by any local government unit in the district. No other provision of law relating to debt limit shall restrict or in any way limit the power of the board to issue the bonds and certificates authorized in section 13. The board shall also have power to levy taxes as provided in sections 10 and 12. The county auditor shall annually assess and extend upon the tax rolls the portion of the taxes levied by the board in each year which is certified to the auditor by the board. The county treasurer shall collect and make settlement of such taxes with the treasurer of the board.

Sec. 15. [DEPOSITORIES.]

The board shall from time to time designate one or more national or state banks, or trust companies authorized to do a banking business, as official depositories for money of the board, and thereupon shall require the treasurer to deposit all or a part of such money in such institutions. Such designation shall be in writing and shall set forth all the terms and conditions upon which the deposits are made, and shall be signed by the chair and treasurer, and made a part of the minutes of the board. Any bank or trust company so designated shall qualify as a depository by furnishing a corporate surety bond or collateral in the amounts required by Minnesota Statutes, section 118A.03. However, no bond or collateral shall be required to secure any deposit insofar as it is insured under federal law.

Sec. 16. [MONEY; ACCOUNTS AND INVESTMENTS.]

Subdivision 1. [RECEIPT AND APPLICATION.] All money received by the board shall be deposited or invested by the treasurer and disposed of as the board may direct in accordance with its budget; provided that any money that has been pledged or dedicated by the board to the payment of obligations or interest thereon or expenses incident thereto, or for any other specific purpose authorized by law, shall be paid by the treasurer into the fund to which they have been pledged.

Subd. 2. [FUNDS AND ACCOUNTS.] The board's treasurer shall establish such funds and accounts as may be necessary or convenient to handle the receipts and disbursements of the board in an orderly fashion.

Subd. 3. [DEPOSIT AND INVESTMENT.] The money on hand in said funds and accounts may be deposited in the official depositories of the board or invested as hereinafter provided. The amount thereof not currently needed or required by law to be kept in cash on deposit may be invested in obligations authorized for the investment of municipal sinking funds by law. The money may also be held under certificates of deposit issued by any official depository of the board. All investments by the board must conform to an investment policy adopted by the board and amended from time to time.

Subd. 4. [BONDS PROCEEDS.] The use of proceeds of all bonds issued by the board for the acquisition and betterment of the district disposal system, and the use, other than investment, of all money on hand in any sinking fund or funds of the board, shall be governed by Minnesota Statutes, chapter 475, this article, and the resolutions authorizing the issuance of the bonds. Such bond proceeds when received shall be transferred to the treasurer of the board for safekeeping, investment, and payment of the costs for which they were issued.

Sec. 17. [GENERAL POWERS OF BOARD.]

Subdivision 1. [ALL NECESSARY OR CONVENIENT POWER.] The board shall have all powers which may be necessary or convenient to discharge the duties imposed upon it by law. The powers shall include those herein specified, but the express grant or enumeration of powers does not limit the generality or scope of the grant of power contained in this subdivision.

Subd. 2. [SUITS.] The board may sue or be sued.

Subd. 3. [CONTRACTS.] The board may enter into any contract necessary or proper for the exercise of its powers of the accomplishment of its purposes.

Subd. 4. [RULES.] The board shall have the power to adopt rules relating to the board's responsibilities and may provide penalties for the violation thereof not exceeding the maximum which may be specified for a misdemeanor, and the cost of prosecution may be added to the penalties imposed. Any rule prescribing a penalty for violation shall be published at least once in a newspaper having general circulation in the district. Such violations may be prosecuted before any court in the district having jurisdiction of misdemeanor, and every such court shall have jurisdiction of such violations. Any constable or other peace officer of any municipality in the district may make arrests for such violations committed anywhere in the district in like manner and with like effect as for violations of village ordinances or for statutory misdemeanors. All fines collected in such cases shall be deposited in the treasury of the board, or may be allocated between the board and the municipality in which such prosecution occurs on such basis as the board and the municipality agree.

Subd. 5. [GIFTS; GRANTS.] The board may accept gifts, may apply for and accept grants or loans of money or other property from the United States, the state, or any person for any of its purposes, may enter into any agreement required in connection herewith, and may hold, use, and dispose of such money or property in accordance with the terms of the gift, grant, loan, or agreement relating thereto; and, with respect to any loans or grants of funds or real or personal property or other assistance from any state or federal government or any agency or instrumentality thereof, the board may contract to do and perform all acts and things required as a condition or consideration therefore pursuant to state or federal law or regulations, whether or not included among the powers expressly granted to the board in this article.

Subd. 6. [JOINT POWERS.] The board may act under Minnesota Statutes, section 471.59, or any other appropriate law providing for joint or cooperative action between government units.

Subd. 7. [RESEARCH, HEARINGS, INVESTIGATIONS, ADVISE.] The board may conduct research studies and programs, collect and analyze data, prepare reports, maps, charts, and tables, and conduct all necessary hearings and investigations in connection with the design, construction, and operation of the district disposal system; and may advise and assist other government units on system planning matters within the scope of its powers, duties, and objectives and may provide at the request of any such governmental unit such other technical and administrative assistance as the board deems appropriate for the government unit to carry out the powers and duties vested in the government unit under this article or imposed on by the board.

Subd. 8. [EMPLOYEES, CONTRACTORS, INSURANCE.] The board may employ on such terms as it deems advisable, persons or firms performing engineering, legal, or other services of a professional nature; require any employee to obtain and file with it an individual bond or fidelity insurance policy; and procure insurance in such amounts as it deems necessary against liability of the board or its officers or both, for personal injury or death and property damage or destruction, with the force and effect stated in Minnesota Statutes, chapter 466, and against risks of damage to or destruction of any of its facilities, equipment, or other property as it deems necessary.

or without the district as may be necessary for the exercise by the board of its powers or the accomplishment of its purposes. The board may hold, lease, convey, or otherwise dispose of such property for its purposes upon such terms and in such manner as it shall deem advisable. Unless otherwise provided, the right to acquire lands and property rights by condemnation shall be exercised in accordance with Minnesota Statutes, chapter 117, and shall apply to any property or interest therein owned by any local government unit; provided, that no such property devoted to an actual public use at the time, or held to be devoted to such use within a reasonable time, shall be so acquired unless a court of competent jurisdiction shall determine that the use proposed by the board is paramount to such use. Except in case of property in actual public use, the board may take possession of any property of which condemnation proceedings have been commenced at any time after the issuance of a court order appointing commissioners for its condemnation.

Subd. 10. [RIGHTS-OF-WAY.] The board may construct or maintain its systems or facilities in, along, on, under, over, or through public waters, streets, bridges, viaducts, and other public right-of-way without first obtaining a franchise from any county or local government unit having jurisdiction over them; but such facilities shall be constructed and maintained in accordance with the ordinances and resolutions of any such county or government unit relating to construction, installation, and maintenance of similar facilities on such public properties and shall not unnecessarily obstruct the public use of such rights-of-way.

Subd. 11. [DISPOSAL OF PROPERTY.] The board may sell, lease, or otherwise dispose of any real or personal property acquired by it which is no longer required for accomplishment of its purposes. Such property may be sold in the manner provided by Minnesota Statutes, section 469.065, insofar as practical. The board may give such notice of sale as it shall deem appropriate. When the board determines that any property or any part of the district disposal system which has been acquired from a local government unit without compensation is no longer required but is required as a local facility by the government unit from which it was acquired, the board may by resolution transfer it to such government unit.

Subd. 12. [JOINT OPERATIONS.] The board may contract with the United States or any agency thereof, any state or agency thereof, or any regional public planning body in the state with jurisdiction over any part of the district, or any other municipal or public corporation, or governmental subdivision in any state, for the joint use of any facility owned by the board or such entity, for the operation by such entity of any system or facility of the board, or for the performance on the board's behalf of any service including, but not limited to, planning, on such terms as may be agreed upon by the contracting parties. Unless designated by the board as a local sanitary sewer facility, any treatment works or interceptor jointly used, or operated on behalf of the board, as provided in this subdivision, shall be deemed to be operated by the board for purposes of including said facilities in the district disposal system.

Sec. 18. [LOCAL FACILITIES.]

Subdivision 1. [SANITARY SEWER FACILITIES.] Except as otherwise provided in this article, local government units shall retain responsibility for the planning, design, acquisition, betterment, operation, administration, and maintenance of all local sanitary sewer facilities as provided by law.

Subd. 2. [ASSUMPTION OF RESPONSIBILITY OVER LOCAL SANITARY SEWER FACILITIES.] The board shall upon request of any government unit or units assume either alone or jointly with the local government unit all or any part of the responsibility of the local government unit described in subdivision 1. Except as provided in subdivision 4 and for the purpose of exercising such responsibility, the board shall have all the powers and duties elsewhere conferred in this article with the same force and effect as if such local sanitary sewer facilities were a part of the district disposal system.

Subd. 4. [ALLOCATION OF CURRENT COSTS.] All current costs attributable to responsibilities assumed by the board over local sanitary sewer facilities and water and street facilities as provided in this section shall be allocated solely to the local unit for or with whom such responsibilities are assumed on such terms and over such period as the board determines to be equitable and in the best interest of the district, provided that if two or more government units form a region in accordance with this section, all or part of such current costs attributable to the region shall at the request of its joint board be allocated to the region and provided in the agreement establishing the region.

Subd. 5. [PART OF DISTRICT SYSTEM.] Nothing contained in this section or in any other part of this article shall be construed to prevent the board from including, where appropriate, treatment works or interceptors, previously designated or treated as local sanitary sewer facilities as a part of the district disposal system.

Sec. 19. [SERVICE CONTRACTS WITH GOVERNMENTS OUTSIDE DISTRICT.]

The board may contract with the United States or any agency thereof, any state or any agency thereof, or any municipal or public corporation, governmental subdivision or agency or political subdivision in any state, outside the jurisdiction of the board, for furnishing to such entities any services which the board may furnish to local government units in the district under this article including, but not limited to, planning for and the acquisition, betterment, operation, administration, and maintenance of any or all interceptors, treatment works, and local sanitary sewer facilities, provided that the board may further include as one of the terms of the contract that such entity also pay to the board such amount as may be agreed upon as a reasonable estimate of the proportionate share properly allocable to the entity of costs of acquisition, betterment, and debt service previously allocated to local government units in the district. When such payments are made by such entities to the board, they shall be applied in reduction of the total amount of costs thereafter allocated to each local government unit in the district, on such equitable basis as the board deems to be in the best interest of the district. Any municipality in the state of Minnesota may enter into such contract and perform all acts and things required as a condition or consideration therefore consistent with the purpose of this article, whether or not included among the powers otherwise granted to such municipality by law or charter, such powers to include those powers set out in section 10, subdivisions 3, 3a, and 4.

Sec. 20. [CONTRACTS FOR CONSTRUCTION, MATERIALS, SUPPLIES, AND EQUIPMENT.]

Subdivision 1. [PLANS AND SPECIFICATIONS.] When the board orders a project involving the acquisition or betterment of a part of the district disposal system it shall cause plans and specifications of this project to be made, or if previously made, to be modified, if necessary, and to be approved by the agency if required, and after any required approval by the agency, one or more contracts for work and materials called for by such plans and specification may be awarded as provided in this section.

Subd. 2. [UNIFORM MUNICIPAL CONTRACTING LAW.] Except as otherwise provided in this section, all contracts for work to be done or for purchases of materials, supplies, or equipment shall be done in accordance with Minnesota Statutes, section 471.345.

Subd. 3. [CONTRACTS OR PURCHASES.] The board may, without advertising for bids, enter into any contract or purchase any materials, supplies, or equipment of the type referred to in subdivision 2 in accordance with applicable state law.

Sec. 21. [ANNEXATION OF TERRITORY.]

place of or in addition thereto such other and further conditions as the board deems in the best interests of the district. Notwithstanding any other provisions of this article to the contrary, the conditions established for annexation may include the requirement that the annexed municipality pay for, contract for, and oversee the construction of local sanitary sewer facilities and interceptor sewers as those terms are defined in section 2. For the purpose of paying such contribution or of satisfying any other condition established by the board, the municipality petitioning annexation may exercise the powers conferred in section 10. When such contributions are made by the municipality to the board, they shall be applied in reduction of the total amount of costs thereafter allocated to each local government unit in the district, on such equitable basis as the board deems to be in the best interests of the district, applying so far as practicable and appropriate the criteria set forth in section 9, subdivision 2. Upon annexation of such territory, the secretary of the board shall certify to the auditor and treasurer of the county in which the municipality is located the fact of such annexation and a legal description of the territory annexed.

Sec. 22. [PROPERTY EXEMPT FROM TAXATION.]

Any properties, real or personal, owned, leased, controlled, used, or occupied by the sanitary sewer board for any purpose under this article are declared to be acquired, owned, leased, controlled, used, and occupied for public, governmental, and municipal purposes, and are exempt from taxation by the state or any political subdivision of the state, provided that such properties are subject to special assessments levied by a political subdivision for a local improvement in amounts proportionate to and not exceeding the special benefit received by the properties from such improvement. No possible use of any such properties in any manner different from their use as part of the disposal system at the time shall be considered in determining the special benefit received by such properties. All such assessments shall be subject to final approval by the board, whose determination of the benefits shall be conclusive upon the political subdivision levying the assessment. All bonds, certificates of indebtedness, or other obligations of the board, and the interest thereon, are exempt from taxation by the state or any political subdivision of the state.

Sec. 23. [RELATION TO EXISTING LAWS.]

This article prevails over any law or charter inconsistent with it. The powers conferred on the board under this article do not diminish or supersede the powers conferred on the agency by Minnesota Statutes, chapters 115 and 116.

Sec. 24. [LOCAL APPROVAL.]

This article takes effect the day after the governing bodies of the city of Farwell in Pope county and the city of Kensington in Douglas county comply with Minnesota Statutes, section 645.021, subdivision 3, or 30 days after a referendum is held in those cities."

Renumber the articles in sequence and correct internal references

Amend the title accordingly

The motion prevailed and the amendment was adopted.

Abrams and Long moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Page 4, line 14, delete "$489,500,000" and insert "$505,500,000"

Page 1, after line 5 of the first Abrams et al amendment, insert:

"Section 1. Minnesota Statutes 1997 Supplement, section 124.239, subdivision 5a, is amended to read:

Sec. 2. Minnesota Statutes 1997 Supplement, section 124.239, subdivision 5b, is amended to read:

Subd. 5b. [ALTERNATIVE FACILITIES APPROPRIATION.] (a) An amount not to exceed $17,000,000 $20,785,000 for fiscal year 2000 and $21,205,000 for fiscal year 2001 and each year thereafter is appropriated from the general fund to the commissioner of children, families, and learning for fiscal year 2000 and each year thereafter for payment of alternative facilities aid under subdivision 5a. The 2000 appropriation includes $1,700,000 for 1999 and $15,300,000 for 2000.

(b) The appropriation in paragraph (a) must be reduced by the amount of any money specifically appropriated for the same purpose in any year from any state fund."

Page 1, after line 15 of the first Abrams et al amendment, insert:

"Sec. 5. Minnesota Statutes 1996, section 124.95, subdivision 3, is amended to read:

Subd. 3. [DEBT SERVICE EQUALIZATION REVENUE.] (a) For fiscal years 1995 2000 and later, the tier 1 debt service equalization revenue of a district equals the lesser of: (1) the amount raised by a levy of 14 percent times the adjusted net tax capacity of the district; or (2) the eligible debt service revenue minus the amount raised by a levy of ten percent times the adjusted net tax capacity of the district.

(b) For fiscal year 1993, debt service equalization revenue equals one-third of the amount calculated in paragraph (a).

(c) For fiscal year 1994, debt service equalization revenue equals two-thirds of the amount calculated in paragraph (a) 2000 and later, tier 2 debt service equalization revenue equals the greater of: (1) zero; or (2) the total debt service equalization revenue of the district less the district's tier 1 debt service equalization revenue.

Sec. 6. Minnesota Statutes 1996, section 124.95, subdivision 4, is amended to read:

Subd. 4. [EQUALIZED DEBT SERVICE LEVY.] (a) To obtain tier 1 debt service equalization revenue, a district must levy an amount not to exceed the district's tier 1 debt service equalization revenue times the lesser of one or the ratio of:

(1) the quotient derived by dividing the adjusted net tax capacity of the district for the year before the year the levy is certified by the actual pupil units in the district for the school year ending in the year prior to the year the levy is certified; to

(2) $4,707.50.

(b) To obtain tier 2 debt service equalization revenue, a district must levy an amount not to exceed the district's tier 2 debt service equalization revenue times the lesser of one or the ratio of:

(1) the quotient derived by dividing the adjusted net tax capacity of the district for the year before the year the levy is certified by the actual pupil units in the district for the school year ending in the year prior to the year the levy is certified; to

(2) $5,200.

Sec. 7. Minnesota Statutes 1996, section 124.95, subdivision 5, is amended to read:

Subd. 5. [DEBT SERVICE EQUALIZATION AID.] (a) A district's tier 1 debt service equalization aid is the difference between the tier 1 debt service equalization revenue and the tier 1 equalized debt service levy.

(b) A district's tier 2 debt service equalization aid is the difference between the tier 2 debt service equalization revenue and the tier 2 equalized debt service levy.

Sec. 8. Minnesota Statutes 1997 Supplement, section 124.961, is amended to read:

124.961 [DEBT SERVICE APPROPRIATION.]

(a) $35,480,000 in fiscal year 1998, $38,159,000 in fiscal year 1999, and $38,390,000 $39,190,000 in fiscal year 2000 and each year thereafter is appropriated from the general fund to the commissioner of children, families, and learning for payment of debt service equalization aid under section 124.95. The 2000 appropriation includes $3,842,000 for 1999 and $34,548,000 for 2000.

(b) The appropriations in paragraph (a) must be reduced by the amount of any money specifically appropriated for the same purpose in any year from any state fund."

Page 16, after line 36 of the first Abrams et al amendment, insert:

"Sec. 15. Minnesota Statutes 1997 Supplement, section 273.1382, subdivision 3, is amended to read:

Subd. 3. [APPROPRIATION.] An amount sufficient to make the payments required by this section is annually appropriated from the general fund to the commissioner of children, families, and learning, except that for fiscal years 2000 and 2001 the amount necessary to make the increased payments attributable to section 14 is appropriated from the property tax reform account."

Page 17, after line 13 of the first Abrams et al amendment, insert:

"Sec. 17. [273.80] [DISTRESSED HOMESTEAD REINVESTMENT EXEMPTION.]

Subdivision 1. [DEFINITIONS.] For purposes of this section, the following terms shall have the meanings given.

"Substantially condition deficient" means that repairs estimated to cost at least $20,000 are necessary to restore a house to sound operating condition, according to prevailing costs of home improvements for the area.

"Sound operating condition" means that a home meets minimal health and safety standards for residential occupancy under applicable housing or building codes.

"Trained residential rehabilitation consultant" means a person who is employed by a housing services organization recognized by resolution of the city council of the city in which the property is located, and who has been trained in residential housing rehabilitation.

Subd. 2. [ELIGIBILITY.] An owner-occupied, detached, single family dwelling is eligible for treatment under this section if it:

(1) is located in a city of the first class;

(2) is located in a census tract where the median value of owner-occupied homes is less than 80 percent of the median value of owner-occupied homes for the entire city, according to the 1998 assessment;

(3) has an estimated market value which is less than 80 percent of the median value of owner-occupied homes for the entire city, according to the 1998 assessment; and

(4) has been declared to be substantially condition deficient, by a trained residential rehabilitation consultant.

Subd. 4. [TAX BENEFITS.] A property containing a home which qualifies under subdivision 3 shall be exempt from all property taxes for taxes payable in the five years immediately following its certification under subdivision 3, provided that the property continues to be owned and occupied by the same person who owned it when the home was certified as substantially condition deficient.

Subd. 5. [ASSESSMENT; RECORD.] The assessor may require whatever information is necessary to determine eligibility for the tax benefit conferred by this section. During the time that the property is exempt, the assessor shall continue to value the property and record its current value on the tax rolls.

Sec. 18. [273.81] [LOW-INCOME HOUSING AID.]

Subdivision 1. [ELIGIBILITY.] Each year, for all class 4d property with a class rate of one percent in the current assessment year, the assessor shall determine the difference between the actual net tax capacity and the net tax capacity that would be determined for the property if the class rates for taxes payable in 1998 were in effect in the current assessment year. Each year, a city shall be eligible for aid equal to (i) the amount by which the sum of the differences for all class 4d properties with a class rate of one percent in the city exceeds one percent of the city's total taxable net tax capacity for taxes payable in 1998, multiplied by (ii) the city's average net tax capacity tax rate for taxes payable in 1998.

Subd. 2. [CERTIFICATION.] The county assessor shall notify the commissioner of revenue of the amount determined under subdivision 1, clause (i), for any city which qualifies for aid under this section by June 30 of each assessment year, in a form prescribed by the commissioner. The commissioner shall notify each city of its qualifying aid amount by August 15 of the assessment year. The aid determined under this section is a subtraction from the city's levy limit under sections 275.70 to 275.74.

Subd. 3. [APPROPRIATION; PAYMENT.] (a) The commissioner shall pay each city its qualifying aid amount on July 15 of the year following the assessment year. An amount sufficient to pay the aid authorized under this section is appropriated to the commissioner of revenue from the property tax reform account in fiscal years 2000 and 2001, and from the general fund in fiscal years 2002 and thereafter.

(b) Beginning for fiscal year 2001, the amount of aid appropriated under this section may not exceed $1,500,000 after deducting the cost of the reimbursement under Minnesota Statutes, section 273.13, subdivision 25b.

(c) If the total amount of aid that would otherwise be payable under the formula in this section exceeds the maximum allowed under paragraph (b), the amount of aid for each city is reduced proportionately to equal the limit.

Sec. 19. [273.82] [CLASS 4d CREDIT.]

Property taxes due and payable on class 4d property on which initial construction was begun after January 1, 1999, shall be reduced by an amount equal to 60 percent of the property's gross tax. The total amount credited by each county shall be reported to the commissioner of revenue by June 1 of the year in which taxes are payable, in a form prescribed by the commissioner. The commissioner shall make payments to counties for reimbursement of the credit on October 1 of the year in which taxes are payable. Each county auditor shall distribute the payments to local taxing jurisdictions in amounts equal to the amount of taxes reduced by the credit. An amount sufficient to fund the credit authorized under this section is annually appropriated to the commissioner of revenue from the general fund in fiscal years 2002 and subsequent years."

Page 18, line 30 of the first Abrams et al amendment, before "On" insert "(a)"

Page 19, after line 12 of the first Abrams et al amendment, insert:

Page 20, after line 12 of the first Abrams et al amendment, insert:

"(c) [PROPERTY TAX REFUND.] The additional amount necessary to fund the changes in sections 20 and 21 for fiscal year 2000 is appropriated to the commissioner of revenue from the property tax reform account.

(d) [ALTERNATIVE FACILITIES AID.] $3,785,000 for fiscal year 2000 and $4,205,000 for fiscal year 2001 is transferred from the property tax reform account to the general fund to finance the increase in alternative facilities aid under sections 1 and 2."

Page 20 of the first Abrams et al amendment, delete sections 17 and 18

Renumber the sections in sequence and correct internal references

Amend the title accordingly

A roll call was requested and properly seconded.

The question was taken on the Abrams and Long amendment and the roll was called.

Winter moved that those not voting be excused from voting. The motion prevailed.

There were 124 yeas and 7 nays as follows:

Those who voted in the affirmative were:

Abrams	Dorn	Jennings	Mares	Pawlenty	Sviggum
Anderson, B.	Entenza	Johnson, A.	Mariani	Paymar	Swenson, H.
Anderson, I.	Erhardt	Johnson, R.	Marko	Pelowski	Tingelstad
Bakk	Erickson	Juhnke	McCollum	Peterson	Tomassoni
Bettermann	Evans	Kahn	McElroy	Pugh	Tompkins
Biernat	Farrell	Kalis	McGuire	Rest	Trimble
Bishop	Finseth	Kelso	Milbert	Reuter	Tuma
Boudreau	Folliard	Kinkel	Molnau	Rhodes	Tunheim
Bradley	Garcia	Knight	Mulder	Rifenberg	Van Dellen
Broecker	Goodno	Knoblach	Mullery	Rostberg	Vandeveer
Carlson	Greenfield	Koskinen	Munger	Rukavina	Wagenius
Chaudhary	Greiling	Kraus	Murphy	Schumacher	Weaver
Clark, J.	Gunther	Kubly	Nornes	Seifert	Wejcman
Clark, K.	Haas	Kuisle	Olson, E.	Sekhon	Wenzel
Commers	Harder	Larsen	Olson, M.	Skare	Westfall
Daggett	Hasskamp	Leighton	Opatz	Skoglund	Westrom
Davids	Hausman	Leppik	Orfield	Slawik	Winter
Dawkins	Hilty	Lieder	Osskopp	Smith	Wolf
Dehler	Huntley	Lindner	Osthoff	Solberg	Spk. Carruthers
Delmont	Jaros	Long	Otremba, M.	Stanek
Dempsey	Jefferson	Mahon	Ozment	Stang

Those who voted in the negative were:

Kielkucki	Krinkie	Ness	Paulsen	Seagren	Sykora
Workman

Van Dellen, Harder, Kraus and Daggett moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Page 109, line 17, strike "$19,910" and insert "$24,800" and strike "6" and insert "4.75"

Page 109, line 18, strike "$19,910" and insert "$24,800" and strike "$79,120" and insert "$98,540"

Page 109, line 19, strike "$79,120" and insert "$98,540"

Page 109, line 27, strike "$13,620" and insert "$16,960" and strike "6" and insert "4.75"

Page 109, line 28, strike "$13,620" and insert "$16,960" and strike "$44,750" and insert "$55,730"

Page 109, line 29, strike "$44,750" and insert "$55,730"

Page 109, line 34, strike "$16,770" and insert "$20,890" and strike "6" and insert "4.75"

Page 109, line 35, strike "$16,770" and insert "$20,890" and strike "$67,390" and insert "$83,930"

Page 109, line 36, strike "$67,390" and insert "$83,930"

Page 110, after line 34, insert:

"Sec. 8. Minnesota Statutes 1996, section 290.06, subdivision 2d, is amended to read:

Subd. 2d. [INFLATION ADJUSTMENT OF BRACKETS.] (a) For taxable years beginning after December 31, 1991 1998, the minimum and maximum dollar amounts for each rate bracket for which a tax is imposed in subdivision 2c shall be adjusted for inflation by the percentage determined under paragraph (b). For the purpose of making the adjustment as provided in this subdivision all of the rate brackets provided in subdivision 2c shall be the rate brackets as they existed for taxable years beginning after December 31, 1990 1997, and before January 1, 1992 1999. The rate applicable to any rate bracket must not be changed. The dollar amounts setting forth the tax shall be adjusted to reflect the changes in the rate brackets. The rate brackets as adjusted must be rounded to the nearest $10 amount. If the rate bracket ends in $5, it must be rounded up to the nearest $10 amount.

(b) The commissioner shall adjust the rate brackets and by the percentage determined pursuant to the provisions of section 1(f) of the Internal Revenue Code, except that in section 1(f)(3)(B) the word "1990 1997" shall be substituted for the word "1987." For 1991 1998, the commissioner shall then determine the percent change from the 12 months ending on August 31, 1990 1997, to the 12 months ending on August 31, 1991 1998, and in each subsequent year, from the 12 months ending on August 31, 1990 1998, to the 12 months ending on August 31 of the year preceding the taxable year. The determination of the commissioner pursuant to this subdivision shall not be considered a "rule" and shall not be subject to the administrative procedure act contained in chapter 14.

No later than December 15 of each year, the commissioner shall announce the specific percentage that will be used to adjust the tax rate brackets."

Page 114, after line 10, insert:

"Sec. 12. Minnesota Statutes 1996, section 290.091, subdivision 1, is amended to read:

Subdivision 1. [IMPOSITION OF TAX.] In addition to all other taxes imposed by this chapter a tax is imposed on individuals, estates, and trusts equal to the excess (if any) of

(a) an amount equal to seven 6.8 percent of alternative minimum taxable income after subtracting the exemption amount, over

Page 115, line 30, delete "seven" and insert "6.8"

Page 116, line 28, delete "seven" and insert "6.8"

Page 122, after line 23, insert "and the changes in the rates and brackets"

Page 122, line 24, delete "is" and insert "are"

Page 122, line 26, before the semicolon insert "and paragraph (c)"

Page 122, line 27, after the second comma insert "the rate change in clause (2),"

Page 122, line 31, after the period insert "Section 8 is effective for tax years beginning after December 31, 1998. Section 12 is effective for tax years beginning after December 31, 1997."

Renumber the sections in sequence and correct internal references

Amend the title accordingly

A roll call was requested and properly seconded.

The question was taken on the Van Dellen et al amendment and the roll was called.

Winter moved that those not voting be excused from voting. The motion prevailed.

There were 64 yeas and 68 nays as follows:

Those who voted in the affirmative were:

Abrams	Dehler	Kielkucki	McElroy	Rifenberg	Tompkins
Anderson, B.	Dempsey	Knight	Molnau	Rostberg	Tuma
Bettermann	Erhardt	Knoblach	Mulder	Seagren	Van Dellen
Bishop	Erickson	Kraus	Nornes	Seifert	Vandeveer
Boudreau	Farrell	Krinkie	Olson, M.	Smith	Weaver
Bradley	Finseth	Kuisle	Osskopp	Stanek	Westfall
Broecker	Goodno	Larsen	Ozment	Stang	Westrom
Clark, J.	Gunther	Leppik	Paulsen	Sviggum	Wolf
Commers	Haas	Lindner	Pawlenty	Swenson, H.	Workman
Daggett	Harder	Macklin	Reuter	Sykora
Davids	Holsten	Mares	Rhodes	Tingelstad

Those who voted in the negative were:

Anderson, I.	Garcia	Juhnke	Marko	Paymar	Tomassoni
Bakk	Greenfield	Kahn	McCollum	Pelowski	Trimble
Biernat	Greiling	Kalis	McGuire	Peterson	Tunheim
Carlson	Hasskamp	Kelso	Milbert	Pugh	Wagenius
Chaudhary	Hausman	Kinkel	Mullery	Rest	Wejcman
Clark, K.	Hilty	Koskinen	Munger	Rukavina	Wenzel
Dawkins	Huntley	Kubly	Murphy	Schumacher	Winter
Delmont	Jaros	Leighton	Olson, E.	Sekhon	Spk. Carruthers
Dorn	Jefferson	Lieder	Opatz	Skare
Entenza	Jennings	Long	Orfield	Skoglund
Evans	Johnson, A.	Mahon	Osthoff	Slawik
Folliard	Johnson, R.	Mariani	Otremba, M.	Solberg

Pawlenty moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Page 109, line 17, strike "$19,910" and insert "$24,800" and strike "6" and insert "5.5"

Page 109, line 18, strike "$19,910" and insert "$24,800" and strike "$79,120" and insert "$98,540"

Page 109, line 19, strike "$79,120" and insert "$98,540"

Page 109, line 27, strike "$13,620" and insert "$16,960" and strike "6" and insert "5.5"

Page 109, line 28, strike "$13,620" and insert "$16,960" and strike "$44,750" and insert "$55,730"

Page 109, line 29, strike "$44,750" and insert "$55,730"

Page 109, line 34, strike "$16,770" and insert "$20,890" and strike "6" and insert "5.5"

Page 109, line 35, strike "$16,770" and insert "$20,890" and strike "$67,390" and insert "$83,930"

Page 109, line 36, strike "$67,390" and insert "$83,930"

Page 110, after line 34, insert:

"Sec. 8. Minnesota Statutes 1996, section 290.06, subdivision 2d, is amended to read:

Subd. 2d. [INFLATION ADJUSTMENT OF BRACKETS.] (a) For taxable years beginning after December 31, 1991 1998, the minimum and maximum dollar amounts for each rate bracket for which a tax is imposed in subdivision 2c shall be adjusted for inflation by the percentage determined under paragraph (b). For the purpose of making the adjustment as provided in this subdivision all of the rate brackets provided in subdivision 2c shall be the rate brackets as they existed for taxable years beginning after December 31, 1990 1997, and before January 1, 1992 1999. The rate applicable to any rate bracket must not be changed. The dollar amounts setting forth the tax shall be adjusted to reflect the changes in the rate brackets. The rate brackets as adjusted must be rounded to the nearest $10 amount. If the rate bracket ends in $5, it must be rounded up to the nearest $10 amount.

(b) The commissioner shall adjust the rate brackets and by the percentage determined pursuant to the provisions of section 1(f) of the Internal Revenue Code, except that in section 1(f)(3)(B) the word "1990 1997" shall be substituted for the word "1987." For 1991 1998, the commissioner shall then determine the percent change from the 12 months ending on August 31, 1990 1997, to the 12 months ending on August 31, 1991 1998, and in each subsequent year, from the 12 months ending on August 31, 1990 1998, to the 12 months ending on August 31 of the year preceding the taxable year. The determination of the commissioner pursuant to this subdivision shall not be considered a "rule" and shall not be subject to the administrative procedure act contained in chapter 14.

No later than December 15 of each year, the commissioner shall announce the specific percentage that will be used to adjust the tax rate brackets."

Page 122, after line 23, insert "and the changes in the rates and brackets"

Page 122, line 24, delete "is" and insert "are"

Page 122, line 31, after the period insert "Section 8 is effective for tax years beginning after December 31, 1998."

Renumber the sections in sequence and correct internal references

Amend the title accordingly

The question was taken on the Pawlenty amendment and the roll was called. There were 66 yeas and 67 nays as follows:

Those who voted in the affirmative were:

Abrams	Dehler	Juhnke	Mares	Reuter	Sykora
Anderson, B.	Dempsey	Kielkucki	McElroy	Rhodes	Tingelstad
Bettermann	Erhardt	Knight	Molnau	Rifenberg	Tompkins
Bishop	Erickson	Knoblach	Mulder	Rostberg	Tuma
Boudreau	Farrell	Kraus	Ness	Seagren	Van Dellen
Bradley	Finseth	Krinkie	Nornes	Seifert	Vandeveer
Broecker	Goodno	Kuisle	Olson, M.	Smith	Weaver
Clark, J.	Gunther	Larsen	Osskopp	Stanek	Westfall
Commers	Haas	Leppik	Ozment	Stang	Westrom
Daggett	Harder	Lindner	Paulsen	Sviggum	Wolf
Davids	Holsten	Macklin	Pawlenty	Swenson, H.	Workman

Those who voted in the negative were:

Anderson, I.	Garcia	Kahn	McCollum	Pelowski	Trimble
Bakk	Greenfield	Kalis	McGuire	Peterson	Tunheim
Biernat	Greiling	Kelso	Milbert	Pugh	Wagenius
Carlson	Hasskamp	Kinkel	Mullery	Rest	Wejcman
Chaudhary	Hausman	Koskinen	Munger	Rukavina	Wenzel
Clark, K.	Hilty	Kubly	Murphy	Schumacher	Winter
Dawkins	Huntley	Leighton	Olson, E.	Sekhon	Spk. Carruthers
Delmont	Jaros	Lieder	Opatz	Skare
Dorn	Jefferson	Long	Orfield	Skoglund
Entenza	Jennings	Mahon	Osthoff	Slawik
Evans	Johnson, A.	Mariani	Otremba, M.	Solberg
Folliard	Johnson, R.	Marko	Paymar	Tomassoni

The motion did not prevail and the amendment was not adopted.

Van Dellen and Kraus moved to amend H. F. No. 3840, the first engrossment, as amended, as follows:

Page 110, after line 34, insert:

"Sec. 8. Minnesota Statutes 1996, section 290.06, is amended by adding a subdivision to read:

Subd. 2g. [CONTINGENT RATE REDUCTION.] If the commissioner receives certification from the commissioner of finance that the balance in the income tax reserve account under section 16A.1523 will sustain a permanent reduction in the rates, each of the rates in subdivision 2c is reduced by one-tenth of a percentage point for each unit the commissioner of finance certifies under section 16A.1523. The rate reduction takes effect for the first taxable year beginning after the certification is made. The commissioner must adjust the withholding tables, if the rate reduction exceeds two-tenths of a percentage point."

Page 177, line 18, before "If" insert "(a)"

Page 177, line 24, strike "(a)" and insert "(1)"

Page 177, line 26, strike "(b)" and insert "(2)"

Page 177, after line 29, insert:

"(b) If on the basis of a forecast of general fund revenues and expenditures after November 1 of an even-numbered year, the commissioner of finance estimates that:

(1) there is a positive unrestricted budgetary balance after the allocation under paragraph (a), clause (1); and

(2) at least a part of the balance is a structural balance resulting from changes in revenue or spending that will continue in an annual or biennial basis into the reasonably foreseeable future,

then an amount equal to the portion the commissioner estimates is a structural balance is allocated to the income tax reserve account under section 16A.1523."

Page 177, line 30, before "The" insert "(c)"

Page 177, after line 32, insert:

"Sec. 2. [16A.1523] [INCOME TAX RESERVE ACCOUNT.]

(a) An income tax reserve account is established in the general fund.

(b) Amounts in the account are only available for income tax rate reductions under section 290.06, subdivision 2g.

(c) The balance in the account does not cancel and remains in the account until used for individual income tax rate reductions under section 290.06, subdivision 2g.

(d) If the commissioner determines that the balance in the account will sustain a permanent reduction in income tax revenues resulting from a one-tenth of a percentage point reduction in each of the individual income tax rates, the commissioner shall certify to the commissioner of revenue the number of units of rate reduction that are sustainable. Each one-tenth percentage point reduction in the individual income tax rates is a unit."

Renumber the sections in sequence and correct internal references

Amend the title accordingly

A roll call was requested and properly seconded.

The question was taken on the Van Dellen and Kraus amendment and the roll was called.

Winter moved that those not voting be excused from voting. The motion prevailed.

There were 64 yeas and 67 nays as follows:

Those who voted in the affirmative were:

Abrams	Dehler	Knight	Molnau	Rifenberg	Tompkins
Anderson, B.	Dempsey	Knoblach	Mulder	Rostberg	Tuma
Bettermann	Erhardt	Kraus	Ness	Seagren	Van Dellen
Bishop	Erickson	Krinkie	Nornes	Seifert	Vandeveer
Boudreau	Finseth	Kuisle	Olson, M.	Smith	Weaver
Bradley	Goodno	Larsen	Osskopp	Stanek	Westfall
Broecker	Gunther	Leppik	Ozment	Stang	Westrom
Clark, J.	Haas	Lindner	Paulsen	Sviggum	Wolf
Commers	Harder	Macklin	Pawlenty	Swenson, H.	Workman
Daggett	Holsten	Mares	Reuter	Sykora
Davids	Kielkucki	McElroy	Rhodes	Tingelstad