1.1.................... moves to amend H.F. No. 4 as follows:
1.2Delete everything after the enacting clause and insert:

1.3"ARTICLE 1
1.4INDIVIDUAL INCOME, CORPORATE, FRANCHISE, AND ESTATE TAXES

1.5    Section 1. Minnesota Statutes 2016, section 13.4967, is amended by adding a subdivision
1.6to read:
1.7    Subd. 9. Minnesota housing credit. Data related to Minnesota housing tax credit
1.8certifications and allocations are classified in section 462A.39.
1.9EFFECTIVE DATE.This section is effective the day following final enactment.

1.10    Sec. 2. [41B.0391] BEGINNING FARMER PROGRAM; TAX CREDITS.
1.11    Subdivision 1. Definitions. (a) For purposes of this section, the following terms have
1.12the meanings given.
1.13(b) "Agricultural assets" means agricultural land, livestock, facilities, buildings, and
1.14machinery used for farming in Minnesota.
1.15(c) "Beginning farmer" means a resident of Minnesota who:
1.16(1) is seeking entry, or has entered within the last ten years, into farming;
1.17(2) intends to farm land located within the state borders of Minnesota;
1.18(3) is not and whose spouse is not a family member of the owner of the agricultural
1.19assets from whom the beginning farmer is seeking to purchase or rent agricultural assets;
1.20(4) is not and whose spouse is not a family member of a partner, member, shareholder,
1.21or trustee of the owner of agricultural assets from whom the beginning farmer is seeking to
1.22purchase or rent agricultural assets; and
2.1(5) meets the following eligibility requirements as determined by the authority:
2.2(i) has a net worth that does not exceed the limit provided under section 41B.03,
2.3subdivision 3, paragraph (a), clause (2);
2.4(ii) provides the majority of the day-to-day physical labor and management of the farm;
2.5(iii) has, by the judgment of the authority, adequate farming experience or demonstrates
2.6knowledge in the type of farming for which the beginning farmer seeks assistance from the
2.7authority;
2.8(iv) demonstrates to the authority a profit potential by submitting projected earnings
2.9statements;
2.10(v) asserts to the satisfaction of the authority that farming will be a significant source
2.11of income for the beginning farmer;
2.12(vi) participates in a financial management program approved by the authority or the
2.13commissioner of agriculture; and
2.14(vii) has other qualifications as specified by the authority.
2.15(d) "Family member" means a family member within the meaning of the Internal Revenue
2.16Code, section 267(c)(4).
2.17(e) "Farm product" means plants and animals useful to humans and includes, but is not
2.18limited to, forage and sod crops, oilseeds, grain and feed crops, dairy and dairy products,
2.19poultry and poultry products, livestock, fruits, and vegetables.
2.20(f) "Farming" means the active use, management, and operation of real and personal
2.21property for the production of a farm product.
2.22(g) "Owner of agricultural assets" means an individual, trust, or pass-through entity that
2.23is the owner in fee of agricultural land or has legal title to any other agricultural asset. Owner
2.24of agricultural assets does not mean an equipment dealer, livestock dealer defined in section
2.2517A.03, subdivision 7, or comparable entity that is engaged in the business of selling
2.26agricultural assets for profit and that is not engaged in farming as its primary business
2.27activity.
2.28(h) "Share rent agreement" means a rental agreement in which the principal consideration
2.29given to the owner of agricultural assets is a predetermined portion of the production of
2.30farm products produced from the rented agricultural assets and which provides for sharing
2.31production costs or risk of loss, or both.
3.1    Subd. 2. Tax credit for owners of agricultural assets. (a) An owner of agricultural
3.2assets may take a credit against the tax due under chapter 290 for the sale or rental of
3.3agricultural assets to a beginning farmer. An owner of agricultural assets may take a credit
3.4equal to:
3.5(1) five percent of the sale price of the agricultural asset;
3.6(2) ten percent of the gross rental income in each of the first, second, and third years of
3.7a rental agreement; or
3.8(3) 15 percent of the cash equivalent of the gross rental income in each of the first,
3.9second, and third years of a share rent agreement.
3.10(b) A qualifying rental agreement includes cash rent of agricultural assets or a share rent
3.11agreement. The agricultural asset must be rented at prevailing community rates as determined
3.12by the authority. The credit may be claimed only after approval and certification by the
3.13authority.
3.14(c) An owner of agricultural assets or beginning farmer may terminate a rental agreement,
3.15including a share rent agreement, for reasonable cause upon approval of the authority. If a
3.16rental agreement is terminated without the fault of the owner of agricultural assets, the tax
3.17credits shall not be retroactively disallowed. If an agreement is terminated with fault by the
3.18owner of agricultural assets, any prior tax credits claimed under this subdivision by the
3.19owner of agricultural assets shall be disallowed and must be repaid to the commissioner of
3.20revenue.
3.21(d) The credit is limited to the liability for tax as computed under chapter 290 for the
3.22taxable year. If the amount of the credit determined under this section for any taxable year
3.23exceeds this limitation, the excess is a beginning farmer incentive credit carryover according
3.24to section 290.06, subdivision 37.
3.25    Subd. 3. Beginning farmer management tax credit. (a) A beginning farmer may take
3.26a credit against the tax due under chapter 290 for participating in a financial management
3.27program approved by the authority. The credit is equal to 100 percent of the cost of
3.28participating in the program. The credit is available for up to three years while the farmer
3.29is in the program. The authority shall maintain a list of approved financial management
3.30programs and establish a procedure for approving equivalent programs that are not on the
3.31list.
3.32(b) The credit is limited to the liability for tax as computed under chapter 290 for the
3.33taxable year. If the amount of the credit determined under this section for any taxable year
4.1exceeds this limitation, the excess is a beginning farmer management credit carryover
4.2according to section 290.06, subdivision 38.
4.3    Subd. 4. Authority duties. The authority shall:
4.4(1) approve and certify beginning farmers as eligible for the program under this section;
4.5(2) approve and certify owners of agricultural assets as eligible for the tax credit under
4.6subdivision 2;
4.7(3) provide necessary and reasonable assistance and support to beginning farmers for
4.8qualification and participation in financial management programs approved by the authority;
4.9and
4.10(4) refer beginning farmers to agencies and organizations that may provide additional
4.11pertinent information and assistance.
4.12EFFECTIVE DATE.This section is effective for taxable years beginning after December
4.1331, 2016.

4.14    Sec. 3. Minnesota Statutes 2016, section 290.01, subdivision 7, is amended to read:
4.15    Subd. 7. Resident. (a) The term "resident" means any individual domiciled in Minnesota,
4.16except that an individual is not a "resident" for the period of time that the individual is a
4.17"qualified individual" as defined in section 911(d)(1) of the Internal Revenue Code, if the
4.18qualified individual notifies the county within three months of moving out of the country
4.19that homestead status be revoked for the Minnesota residence of the qualified individual,
4.20and the property is not classified as a homestead while the individual remains a qualified
4.21individual.
4.22(b) "Resident" also means any individual domiciled outside the state who maintains a
4.23place of abode in the state and spends in the aggregate more than one-half of the tax year
4.24in Minnesota, unless:
4.25(1) the individual or the spouse of the individual is in the armed forces of the United
4.26States; or
4.27(2) the individual is covered under the reciprocity provisions in section 290.081.
4.28For purposes of this subdivision, presence within the state for any part of a calendar day
4.29constitutes a day spent in the state. A day does not qualify as a Minnesota day if the taxpayer
4.30traveled from a place outside of Minnesota primarily for and essential to obtaining medical
4.31care, as defined in Internal Revenue Code, section 213(d)(1)(A), in Minnesota for the
4.32taxpayer, spouse, or a dependent of the taxpayer and the travel expense is allowed under
5.1section 213(d)(1)(B) of the Internal Revenue Code, and is claimed by the taxpayer as a
5.2deductible expense. Individuals shall keep adequate records to substantiate the days spent
5.3outside the state.
5.4The term "abode" means a dwelling maintained by an individual, whether or not owned
5.5by the individual and whether or not occupied by the individual, and includes a dwelling
5.6place owned or leased by the individual's spouse.
5.7(c) In determining where an individual is domiciled, neither the commissioner nor any
5.8court shall consider:
5.9(1) charitable contributions made by an the individual within or without the state in
5.10determining if the individual is domiciled in Minnesota.;
5.11(2) the location of the individual's attorney, certified public accountant, or financial
5.12adviser; or
5.13(3) the place of business of a financial institution at which the individual applies for any
5.14new type of credit or at which the individual opens or maintains any type of account.
5.15(d) For purposes of this subdivision, the following terms have the meanings given them:
5.16(1) "financial adviser" means:
5.17(i) an individual or business entity engaged in business as a certified financial planner,
5.18registered investment adviser, licensed insurance producer or agent, or registered securities
5.19broker-dealer representative; or
5.20(ii) a financial institution providing services related to trust or estate administration,
5.21investment management, or financial planning; and
5.22(2) "financial institution" means a financial institution as defined in section 47.015,
5.23subdivision 1; a state or nationally chartered credit union; or a registered broker-dealer
5.24under the Securities and Exchange Act of 1934.
5.25EFFECTIVE DATE.This section is effective for taxable years beginning after December
5.2631, 2016, except the amendment to paragraph (b) is effective for taxable years beginning
5.27after December 31, 2017.

5.28    Sec. 4. Minnesota Statutes 2016, section 290.0131, is amended by adding a subdivision
5.29to read:
5.30    Subd. 15. First-time home buyer savings account. The amount for a first-time home
5.31buyer savings account required by section 462D.06, subdivision 2, is an addition.
6.1EFFECTIVE DATE.This section is effective for taxable years beginning after December
6.231, 2016.

6.3    Sec. 5. Minnesota Statutes 2016, section 290.0132, subdivision 4, is amended to read:
6.4    Subd. 4. Education expenses. (a) Subject to the limits in paragraph (b), the following
6.5amounts paid to others for each qualifying child are a subtraction:
6.6(1) education-related expenses; plus
6.7(2) tuition and fees paid to attend a school described in section 290.0674, subdivision
6.81
, clause (4), that are not included in education-related expenses; less
6.9(3) any amount amounts used to claim the credit credits under section 290.067 or
6.10290.0674 .
6.11(b) The maximum subtraction allowed under this subdivision is:
6.12(1) $1,625 for each qualifying child in a prekindergarten educational program or in
6.13kindergarten through grade 6; and
6.14(2) $2,500 for each qualifying child in grades 7 through 12.
6.15(c) The definitions in section 290.0674, subdivision 1, apply to this subdivision.
6.16EFFECTIVE DATE.This section is effective for taxable years beginning after December
6.1731, 2016.

6.18    Sec. 6. Minnesota Statutes 2016, section 290.0132, subdivision 14, is amended to read:
6.19    Subd. 14. Section 179 expensing. In each of the five taxable years immediately following
6.20the taxable year in which an addition is required under section 290.0131, subdivision 10,
6.21or 290.0133, subdivision 12, for a shareholder of a corporation that is an S corporation, an
6.22amount equal to one-fifth of the addition made by the taxpayer under section 290.0131,
6.23subdivision 10
, or 290.0133, subdivision 12, for a shareholder of a corporation that is an S
6.24corporation, minus the positive value of any net operating loss under section 172 of the
6.25Internal Revenue Code generated for the taxable year of the addition, is a subtraction. If the
6.26net operating loss exceeds the addition for the taxable year, a subtraction is not allowed
6.27under this subdivision. The current year section 179 allowance under section 290.0804,
6.28subdivision 1, is a subtraction.
6.29EFFECTIVE DATE.This section is effective for taxable years beginning after December
6.3031, 2016.

7.1    Sec. 7. Minnesota Statutes 2016, section 290.0132, is amended by adding a subdivision
7.2to read:
7.3    Subd. 23. Contributions to 529 plan. (a) The amount equal to the contributions made
7.4during the taxable year to one or more accounts in plans qualifying under section 529 of
7.5the Internal Revenue Code, reduced by any withdrawals from accounts during the taxable
7.6year, is a subtraction.
7.7(b) The subtraction under this subdivision does not include amounts rolled over from
7.8other college savings plan accounts.
7.9(c) The subtraction under this subdivision must not exceed $3,000 for married couples
7.10filing joint returns and $1,500 for all other filers, and is limited to individuals who do not
7.11claim the credit under section 290.0684.
7.12EFFECTIVE DATE.This section is effective for taxable years beginning after December
7.1331, 2016.

7.14    Sec. 8. Minnesota Statutes 2016, section 290.0132, is amended by adding a subdivision
7.15to read:
7.16    Subd. 24. Social Security benefits. The amount of Social Security benefits, as provided
7.17in section 290.0803, is a subtraction.
7.18EFFECTIVE DATE.This section is effective for taxable years beginning after December
7.1931, 2016.

7.20    Sec. 9. Minnesota Statutes 2016, section 290.0132, is amended by adding a subdivision
7.21to read:
7.22    Subd. 25. Discharge of indebtedness; education loans. (a) The amount equal to the
7.23discharge of indebtedness of the taxpayer is a subtraction if:
7.24(1) the indebtedness discharged is a qualified education loan;
7.25(2) the taxpayer incurred the indebtedness to pay for qualified higher education expenses
7.26related to attending a graduate degree program; and
7.27(3) the indebtedness was discharged under section 136A.1791, or following the taxpayer's
7.28completion of an income-driven repayment plan.
7.29(b) For the purposes of this subdivision, "qualified education loan" and "qualified higher
7.30education expenses" have the meanings given in section 221 of the Internal Revenue Code.
8.1(c) For purposes of this subdivision, "income-driven repayment plan" means a payment
8.2plan established by the United States Department of Education that sets monthly student
8.3loan payments based on income and family size under United States Code, title 20, section
8.41087e, or similar authority and specifically includes, but is not limited to:
8.5(1) the income-based repayment plan under United States Code, title 20, section 1098e;
8.6(2) the income contingent repayment plan established under United States Code, title
8.720, section 1087e, subsection (e); and
8.8(3) the PAYE program or REPAYE program established by the Department of Education
8.9under administrative regulations.
8.10EFFECTIVE DATE.This section is effective for taxable years beginning after December
8.1131, 2016.

8.12    Sec. 10. Minnesota Statutes 2016, section 290.0132, is amended by adding a subdivision
8.13to read:
8.14    Subd. 26. Carryover section 179 allowance. The carryover section 179 allowance under
8.15section 290.0804, subdivision 2, is a subtraction.
8.16EFFECTIVE DATE.This section is effective for taxable years beginning after December
8.1731, 2016.

8.18    Sec. 11. Minnesota Statutes 2016, section 290.0132, is amended by adding a subdivision
8.19to read:
8.20    Subd. 27. First-time home buyer savings account. (a) The amount for contributions
8.21to and earnings on a first-time home buyer savings account allowed by section 462D.06,
8.22subdivision 1, is a subtraction.
8.23(b) The subtraction allowed under this subdivision for a taxable year is limited to $7,500,
8.24or $15,000 for married joint filers. For a taxpayer whose adjusted gross income, as defined
8.25in section 62 of the Internal Revenue Code, for the taxable year exceeds $125,000, or
8.26$250,000 for married joint filers, the maximum subtraction is reduced $1 for each $4 of
8.27adjusted gross income in excess of that threshold.
8.28(c) The adjusted gross income thresholds under paragraph (b) are annually adjusted for
8.29inflation. Effective for taxable year 2018, the commissioner shall adjust the dollar amount
8.30of the income thresholds at which the maximum credit begins to be reduced under paragraph
8.31(b) by the percentage determined under section 1(f) of the Internal Revenue Code, except
9.1that in section 1(f)(3)(B) the word "2016" is substituted for the word "1992." For 2018, the
9.2commissioner shall then determine the percent change from the 12 months ending on August
9.331, 2016, to the 12 months ending on August 31, 2017, and in each subsequent year, from
9.4the 12 months ending on August 31, 2016, to the 12 months ending on August 31 of the
9.5year preceding the taxable year. The determination of the commissioner under this
9.6subdivision is not a "rule" and is not subject to the Administrative Procedure Act in chapter
9.714. The threshold amount as adjusted must be rounded to the nearest $100 amount. If the
9.8amount ends in $50, the amount is rounded up to the nearest $100 amount.
9.9EFFECTIVE DATE.This section is effective for taxable years beginning after December
9.1031, 2016.

9.11    Sec. 12. [290.016] CONFORMITY TO FEDERAL TAX EXTENDERS BY
9.12ADMINISTRATIVE ACTION.
9.13    Subdivision 1. Legislative purpose. (a) The legislature intends this section to provide
9.14an ongoing mechanism for conforming the Minnesota individual income and corporate
9.15franchise taxes and the property tax refund and homestead credit refund programs to federal
9.16tax legislation enacted after the legislature has adjourned that extends existing provisions
9.17of federal law, if the provisions affect a taxable year that ends before the legislature is
9.18scheduled to reconvene in regular session. Congress has regularly enacted changes of that
9.19type that affect computation of Minnesota tax through its links to federal law. The federal
9.20changes consist mainly of extending provisions that reduce revenues and are scheduled to
9.21expire. Because Minnesota law is linked to federal law as of a specific date, taxpayers and
9.22the Department of Revenue must assume that Minnesota law does not include the effect of
9.23these federal changes even though the legislature regularly adopts most of the federal
9.24provisions retroactively in the next legislative session. This situation undermines compliance
9.25and administration of Minnesota taxes, causing delay, uncertainty, and added costs. This
9.26section provides an administrative mechanism to conform to most of these federal changes.
9.27The legislature's intent is to conform to the federal tax extenders, including minor
9.28modifications of them, and to set aside the necessary state budget resources to do so.
9.29(b) By expressing its intent regarding specific federal provisions and indicating how to
9.30treat each federal extender provision, the legislature is exercising its legislative power and
9.31is not delegating to Congress or the commissioner the authority to determine Minnesota tax
9.32law. The legislature believes that this section is consistent with the Minnesota Supreme
9.33Court's ruling in the case of Wallace v. Commissioner of Taxation, 289 Minn. 220 (1971).
10.1    Subd. 2. Federal tax conformity account established; transfer. (a) A federal tax
10.2conformity account is established in the general fund. Money in the account is available for
10.3transfer to the general fund to offset the reduction in general fund revenues resulting from
10.4conforming Minnesota tax law to federal law under this section.
10.5(b) $35,000,000 is transferred from the general fund to the federal tax conformity account,
10.6effective July 1, 2017.
10.7(c) Each year, within ten days after receiving notice of the amount from the commissioner,
10.8the commissioner of management and budget shall transfer from the account to the general
10.9fund the amount the commissioner determines is required under subdivision 4.
10.10    Subd. 3. Eligible federal tax preferences. For purposes of this section and section
10.11290.01, the term "eligible federal tax preferences" means any of the following items that
10.12are not in effect under the Internal Revenue Code for future taxable years beginning after
10.13December 31, 2016:
10.14(1) discharge of qualified principal residence indebtedness under section 108(a)(1)(E)
10.15of the Internal Revenue Code;
10.16(2) mortgage insurance premiums treated as qualified residence interest under section
10.17163(h)(3)(E) of the Internal Revenue Code;
10.18(3) qualified tuition and related expenses under section 222 of the Internal Revenue
10.19Code;
10.20(4) reversion of the ten percent adjusted gross income threshold used in determining the
10.21itemized deductions of the expenses of medical care under section 213 of the Internal
10.22Revenue Code to 7.5 percent, without regard to whether the reversion applies to all
10.23individuals or is limited to individuals who have attained the age of 65;
10.24(5) classification of certain race horses as three-year property under section
10.25168(e)(3)(A)(i) and (ii) of the Internal Revenue Code;
10.26(6) the seven-year recovery period for motorsports entertainment complexes under
10.27section 168(i)(15) of the Internal Revenue Code;
10.28(7) the accelerated depreciation for business property on an Indian reservation under
10.29section 168(j) of the Internal Revenue Code;
10.30(8) the election to expense mine safety equipment under section 179E of the Internal
10.31Revenue Code;
11.1(9) the special expensing rules for certain film and television productions under section
11.2181 of the Internal Revenue Code;
11.3(10) the special allowance for second-generation biofuel plant property under section
11.4168(l) of the Internal Revenue Code;
11.5(11) the energy efficient commercial buildings deduction under section 179D of the
11.6Internal Revenue Code;
11.7(12) the five-year recovery period for property described in section 168(e)(3)(B)(vi)(I)
11.8of the Internal Revenue Code and qualifying for an energy credit under section 48(a)(3)(A)
11.9of the Internal Revenue Code; and
11.10(13) the amount of the additional section 179 allowance in an empowerment zone under
11.11section 1397A of the Internal Revenue Code.
11.12    Subd. 4. Designation of qualifying federal conformity items. (a) If, after final
11.13adjournment of a regular session of the legislature, Congress enacts a law that extends one
11.14or more of the eligible federal tax preferences to taxable years beginning during the calendar
11.15year in which the legislature adjourned, the commissioner shall prepare a list of qualifying
11.16federal conformity items and publish it on the Department of Revenue's Web site within 30
11.17days following enactment of the law. In preparing the list, the commissioner shall estimate
11.18the change in revenue resulting from allowing the eligible federal tax preferences, including
11.19the effect of subdivision 6, for the current and succeeding fiscal year only. The commissioner
11.20shall not include an item on the list of qualifying federal conformity items if the commissioner
11.21estimates that its inclusion would reduce general fund revenues for the current and succeeding
11.22fiscal year by more than the balance in the federal tax conformity account.
11.23(b) The commissioner shall consider the provisions of subdivision 6 as the first item to
11.24include on the list of qualifying conformity items. The commissioner shall apply the following
11.25priorities in determining which additional items to include:
11.26(1) the effect of all eligible federal tax preferences on computation of federal adjusted
11.27gross income under this chapter and household income under chapter 290A, is the first
11.28priority;
11.29(2) the effect of the federal law on computation of Minnesota tax credits is the second
11.30priority;
11.31(3) the items in subdivision 3, clauses (5) to (13), in that order, are the third priority;
11.32and
11.33(4) the items in subdivision 3, clauses (1) to (4), in that order, are the last priority.
12.1(c) In determining whether to include an eligible federal tax preference on the list of
12.2qualifying federal conformity items, the commissioner may include items in which
12.3nonmaterial changes were made in the federal law extending allowance of the eligible federal
12.4tax preferences, compared to the provision that was in effect for the prior federal taxable
12.5year. For purposes of this determination, nonmaterial changes are limited to changes that
12.6are estimated to increase or decrease Minnesota tax revenues by no more than $1,000,000
12.7for the affected eligible federal tax preference item for the taxable year.
12.8(d) Within ten days after the commissioner's final determination of qualifying federal
12.9conformity items under this subdivision, the commissioner shall notify the commissioner
12.10of management and budget, in writing, of the amounts of the federal tax conformity account
12.11transfers under subdivision 2.
12.12    Subd. 5. Provisions in effect. (a) For purposes of determining tax and credits under this
12.13chapter, including the taxes under sections 290.091 and 290.0921, and household income
12.14under chapter 290A, qualifying federal conformity items and bonus depreciation rules under
12.15subdivision 6 apply for the designated taxable year and the provisions of this chapter apply
12.16as if the definition of the Internal Revenue Code under section 290.01, subdivision 31,
12.17included the amendments to the qualifying federal conformity items.
12.18(b) The commissioner shall administer the taxes under this chapter and refunds under
12.19chapter 290A as if Minnesota had conformed to the federal definitions of net income,
12.20adjusted gross income, and tax credits that affect computation of Minnesota tax or refunds
12.21resulting from extension of the qualifying federal conformity items.
12.22(c) For purposes of this subdivision and subdivision 6, "designated taxable year" means
12.23a taxable year that begins during a calendar year in which an eligible federal tax preference
12.24is enacted after the legislature adjourned its regular session and is effective for taxable years
12.25beginning during that calendar year.
12.26    Subd. 6. Bonus depreciation; 80 percent rule applies. If, following final adjournment
12.27of a regular session of the legislature, Congress enacts a law that extends application of the
12.28depreciation special allowances under section 168(k) of the Internal Revenue Code to taxable
12.29years beginning during the same calendar year, the allowance must be determined using
12.30the rules under sections 290.0131, subdivision 9, and 290.0133, subdivision 11, for the
12.31designated taxable year; and the rules under sections 290.0132, subdivision 9, and 290.0134,
12.32subdivision 13, for the five tax years immediately following the designated taxable year.
12.33    Subd. 7. Forms preparation. If the provisions of subdivisions 3 and 4 apply to a taxable
12.34year, the commissioner shall prepare forms and instructions that reflect the qualifying federal
13.1conformity items and bonus depreciation rules under subdivision 6, if applicable, for the
13.2taxable year consistent with the provisions of this section.
13.3    Subd. 8. Draft legislation. For a taxable year for which the commissioner publishes a
13.4list of qualifying federal conformity items under this section, the commissioner shall provide
13.5the chairs and ranking minority members of the legislative committees with jurisdiction
13.6over taxes with draft legislation that would conform Minnesota Statutes to the qualifying
13.7federal conformity items and any other conformity items that the commissioner recommends
13.8be adopted, including application to taxable years beyond those to which this section applies.
13.9The draft legislation is intended to make the statutes consistent with application of the
13.10designated qualifying federal conformity items under this section for the convenience of
13.11members of the public. Failure to pass the draft legislation does not affect computation of
13.12Minnesota tax liability for the affected taxable years under this section.
13.13    Subd. 9. Administrative Procedure Act. Designation of qualifying federal conformity
13.14items or any other action of the commissioner under this section is not a rule and is not
13.15subject to the Administrative Procedure Act under chapter 14, including section 14.386.
13.16EFFECTIVE DATE.This section is effective the day following final enactment.

13.17    Sec. 13. Minnesota Statutes 2016, section 290.06, is amended by adding a subdivision to
13.18read:
13.19    Subd. 2g. First-time home buyer savings account. In addition to the tax computed
13.20under subdivision 2c, an additional amount of tax applies equal to the additional tax computed
13.21for the taxable year for the account holder of a first-time home buyer account under section
13.22462D.06, subdivision 3.
13.23EFFECTIVE DATE.This section is effective for taxable years beginning after December
13.2431, 2016.

13.25    Sec. 14. Minnesota Statutes 2016, section 290.06, subdivision 22, is amended to read:
13.26    Subd. 22. Credit for taxes paid to another state. (a) A taxpayer who is liable for taxes
13.27based on net income to another state, as provided in paragraphs (b) through (f), upon income
13.28allocated or apportioned to Minnesota, is entitled to a credit for the tax paid to another state
13.29if the tax is actually paid in the taxable year or a subsequent taxable year. A taxpayer who
13.30is a resident of this state pursuant to section 290.01, subdivision 7, paragraph (b), and who
13.31is subject to income tax as a resident in the state of the individual's domicile is not allowed
13.32this credit unless the state of domicile does not allow a similar credit.
14.1(b) For an individual, estate, or trust, the credit is determined by multiplying the tax
14.2payable under this chapter by the ratio derived by dividing the income subject to tax in the
14.3other state that is also subject to tax in Minnesota while a resident of Minnesota by the
14.4taxpayer's federal adjusted gross income, as defined in section 62 of the Internal Revenue
14.5Code, modified by the addition required by section 290.0131, subdivision 2, and the
14.6subtraction allowed by section 290.0132, subdivision 2, to the extent the income is allocated
14.7or assigned to Minnesota under sections 290.081 and 290.17.
14.8(c) If the taxpayer is an athletic team that apportions all of its income under section
14.9290.17, subdivision 5 , the credit is determined by multiplying the tax payable under this
14.10chapter by the ratio derived from dividing the total net income subject to tax in the other
14.11state by the taxpayer's Minnesota taxable income.
14.12(d)(1) The credit determined under paragraph (b) or (c) shall not exceed the amount of
14.13tax so paid to the other state on the gross income earned within the other state subject to
14.14tax under this chapter, nor shall; and
14.15(2) the allowance of the credit does not reduce the taxes paid under this chapter to an
14.16amount less than what would be assessed if such income amount was the gross income
14.17earned within the other state were excluded from taxable net income.
14.18(e) In the case of the tax assessed on a lump-sum distribution under section 290.032, the
14.19credit allowed under paragraph (a) is the tax assessed by the other state on the lump-sum
14.20distribution that is also subject to tax under section 290.032, and shall not exceed the tax
14.21assessed under section 290.032. To the extent the total lump-sum distribution defined in
14.22section 290.032, subdivision 1, includes lump-sum distributions received in prior years or
14.23is all or in part an annuity contract, the reduction to the tax on the lump-sum distribution
14.24allowed under section 290.032, subdivision 2, includes tax paid to another state that is
14.25properly apportioned to that distribution.
14.26(f) If a Minnesota resident reported an item of income to Minnesota and is assessed tax
14.27in such other state on that same income after the Minnesota statute of limitations has expired,
14.28the taxpayer shall receive a credit for that year under paragraph (a), notwithstanding any
14.29statute of limitations to the contrary. The claim for the credit must be submitted within one
14.30year from the date the taxes were paid to the other state. The taxpayer must submit sufficient
14.31proof to show entitlement to a credit.
14.32(g) For the purposes of this subdivision, a resident shareholder of a corporation treated
14.33as an "S" corporation under section 290.9725, must be considered to have paid a tax imposed
14.34on the shareholder in an amount equal to the shareholder's pro rata share of any net income
15.1tax paid by the S corporation to another state. For the purposes of the preceding sentence,
15.2the term "net income tax" means any tax imposed on or measured by a corporation's net
15.3income.
15.4(h) For the purposes of this subdivision, a resident partner of an entity taxed as a
15.5partnership under the Internal Revenue Code must be considered to have paid a tax imposed
15.6on the partner in an amount equal to the partner's pro rata share of any net income tax paid
15.7by the partnership to another state. For purposes of the preceding sentence, the term "net
15.8income" tax means any tax imposed on or measured by a partnership's net income.
15.9(i) For the purposes of this subdivision, "another state":
15.10(1) includes:
15.11(i) the District of Columbia; and
15.12(ii) a province or territory of Canada; but
15.13(2) excludes Puerto Rico and the several territories organized by Congress.
15.14(j) The limitations on the credit in paragraphs (b), (c), and (d), are imposed on a state
15.15by state basis.
15.16(k) For a tax imposed by a province or territory of Canada, the tax for purposes of this
15.17subdivision is the excess of the tax over the amount of the foreign tax credit allowed under
15.18section 27 of the Internal Revenue Code. In determining the amount of the foreign tax credit
15.19allowed, the net income taxes imposed by Canada on the income are deducted first. Any
15.20remaining amount of the allowable foreign tax credit reduces the provincial or territorial
15.21tax that qualifies for the credit under this subdivision.
15.22(l) If the amount of the credit which a qualifying individual is eligible to receive under
15.23this section for tax paid to a qualifying state, disregarding the limitation in paragraph (d),
15.24clause (2), exceeds the tax due under this chapter, the commissioner shall refund the excess
15.25to the individual. An amount sufficient to pay the refunds required by this section is
15.26appropriated to the commissioner from the general fund.
15.27For purposes of this paragraph, "qualifying individual" means a Minnesota resident under
15.28section 290.01, subdivision 7, paragraph (a), who received compensation during the taxable
15.29year for the performance of personal or professional services within a qualifying state, and
15.30"qualifying state" means a state with which an agreement under section 290.081 is not in
15.31effect for the taxable year but was in effect for a taxable year beginning before January 1,
15.322010.
16.1EFFECTIVE DATE.This section is effective for taxable years beginning after December
16.231, 2016.

16.3    Sec. 15. Minnesota Statutes 2016, section 290.06, is amended by adding a subdivision to
16.4read:
16.5    Subd. 37. Beginning farmer incentive credit. (a) A beginning farmer incentive credit
16.6is allowed against the tax due under this chapter for the sale or rental of agricultural assets
16.7to a beginning farmer according to section 41B.0391, subdivision 2.
16.8(b) The credit may be claimed only after approval and certification by the Rural Finance
16.9Authority according to section 41B.0391.
16.10(c) The credit is limited to the liability for tax, as computed under this chapter, for the
16.11taxable year. If the amount of the credit determined under this subdivision for any taxable
16.12year exceeds this limitation, the excess is a beginning farmer incentive credit carryover to
16.13each of the 15 succeeding taxable years. The entire amount of the excess unused credit for
16.14the taxable year is carried first to the earliest of the taxable years to which the credit may
16.15be carried and then to each successive year to which the credit may be carried. The amount
16.16of the unused credit which may be added under this paragraph must not exceed the taxpayer's
16.17liability for tax, less the beginning farmer incentive credit for the taxable year.
16.18(d) Credits allowed to a partnership, a limited liability company taxed as a partnership,
16.19an S corporation, or multiple owners of property are passed through to the partners, members,
16.20shareholders, or owners, respectively, pro rata to each based on the partner's, member's,
16.21shareholder's, or owner's share of the entity's assets or as specially allocated in the
16.22organizational documents or any other executed agreement, as of the last day of the taxable
16.23year.
16.24(e) For a nonresident or part-year resident, the credit under this section must be allocated
16.25using the percentage calculated in section 290.06, subdivision 2c, paragraph (e).
16.26(f) Notwithstanding the approval and certification by the Rural Finance Authority under
16.27section 41B.0391, the commissioner may utilize any audit and examination powers under
16.28chapter 270C or 289A to the extent necessary to verify that the taxpayer is eligible for the
16.29credit and to assess for the amount of any improperly claimed credit.
16.30EFFECTIVE DATE.This section is effective for taxable years beginning after December
16.3131, 2016.

17.1    Sec. 16. Minnesota Statutes 2016, section 290.06, is amended by adding a subdivision to
17.2read:
17.3    Subd. 38. Beginning farmer management credit. (a) A taxpayer who is a beginning
17.4farmer may take a credit against the tax due under this chapter for participation in a financial
17.5management program according to section 41B.0391, subdivision 3.
17.6(b) The credit may be claimed only after approval and certification by the Rural Finance
17.7Authority according to section 41B.0391.
17.8(c) The credit is limited to the liability for tax, as computed under this chapter, for the
17.9taxable year. If the amount of the credit determined under this subdivision for any taxable
17.10year exceeds this limitation, the excess is a beginning farmer management credit carryover
17.11to each of the three succeeding taxable years. The entire amount of the excess unused credit
17.12for the taxable year is carried first to the earliest of the taxable years to which the credit
17.13may be carried and then to each successive year to which the credit may be carried. The
17.14amount of the unused credit which may be added under this paragraph must not exceed the
17.15taxpayer's liability for tax, less the beginning farmer management credit for the taxable
17.16year.
17.17(d) For a part-year resident, the credit under this section must be allocated using the
17.18percentage calculated in section 290.06, subdivision 2c, paragraph (e).
17.19(e) Notwithstanding the approval and certification by the Rural Finance Authority under
17.20section 41B.0391, the commissioner may utilize any audit and examination powers under
17.21chapter 270C or 289A to the extent necessary to verify that the taxpayer is eligible for the
17.22credit and to assess for the amount of any improperly claimed credit.
17.23EFFECTIVE DATE.This section is effective for taxable years beginning after December
17.2431, 2016.

17.25    Sec. 17. Minnesota Statutes 2016, section 290.067, subdivision 1, is amended to read:
17.26    Subdivision 1. Amount of credit. (a) A taxpayer may take as a credit against the tax
17.27due from the taxpayer and a spouse, if any, under this chapter an amount equal to the
17.28dependent care credit for which the taxpayer is eligible pursuant to the provisions of section
17.2921 of the Internal Revenue Code subject to the limitations provided in subdivision 2 except
17.30that in determining whether the child qualified as a dependent, income received as a
17.31Minnesota family investment program grant or allowance to or on behalf of the child must
17.32not be taken into account in determining whether the child received more than half of the
18.1child's support from the taxpayer, and the provisions of section 32(b)(1)(D) of the Internal
18.2Revenue Code do not apply.
18.3(b) If a child who has not attained the age of six years at the close of the taxable year is
18.4cared for at a licensed family day care home operated by the child's parent, the taxpayer is
18.5deemed to have paid employment-related expenses. If the child is 16 months old or younger
18.6at the close of the taxable year, the amount of expenses deemed to have been paid equals
18.7the maximum limit for one qualified individual under section 21(c) and (d) of the Internal
18.8Revenue Code. If the child is older than 16 months of age but has not attained the age of
18.9six years at the close of the taxable year, the amount of expenses deemed to have been paid
18.10equals the amount the licensee would charge for the care of a child of the same age for the
18.11same number of hours of care.
18.12(c) If a married couple:
18.13(1) has a child who has not attained the age of one year at the close of the taxable year;
18.14(2) files a joint tax return for the taxable year; and
18.15(3) does not participate in a dependent care assistance program as defined in section 129
18.16of the Internal Revenue Code, in lieu of the actual employment related expenses paid for
18.17that child under paragraph (a) or the deemed amount under paragraph (b), the lesser of (i)
18.18the combined earned income of the couple or (ii) the amount of the maximum limit for one
18.19qualified individual under section 21(c) and (d) of the Internal Revenue Code will be deemed
18.20to be the employment related expense paid for that child. The earned income limitation of
18.21section 21(d) of the Internal Revenue Code shall not apply to this deemed amount. These
18.22deemed amounts apply regardless of whether any employment-related expenses have been
18.23paid.
18.24(d) If the taxpayer is not required and does not file a federal individual income tax return
18.25for the tax year, no credit is allowed for any amount paid to any person unless:
18.26(1) the name, address, and taxpayer identification number of the person are included on
18.27the return claiming the credit; or
18.28(2) if the person is an organization described in section 501(c)(3) of the Internal Revenue
18.29Code and exempt from tax under section 501(a) of the Internal Revenue Code, the name
18.30and address of the person are included on the return claiming the credit.
18.31In the case of a failure to provide the information required under the preceding sentence,
18.32the preceding sentence does not apply if it is shown that the taxpayer exercised due diligence
18.33in attempting to provide the information required.
19.1(e) In the case of a nonresident, part-year resident, or a person who has earned income
19.2not subject to tax under this chapter including earned income excluded pursuant to section
19.3290.0132, subdivision 10 , the credit determined under section 21 of the Internal Revenue
19.4Code must be allocated based on the ratio by which the earned income of the claimant and
19.5the claimant's spouse from Minnesota sources bears to the total earned income of the claimant
19.6and the claimant's spouse.
19.7(f) For residents of Minnesota, the subtractions for military pay under section 290.0132,
19.8subdivisions 11
and 12, are not considered "earned income not subject to tax under this
19.9chapter."
19.10(g) For residents of Minnesota, the exclusion of combat pay under section 112 of the
19.11Internal Revenue Code is not considered "earned income not subject to tax under this
19.12chapter."
19.13(h) For taxpayers with federal adjusted gross income in excess of $50,000, the credit is
19.14equal to the lesser of the credit otherwise calculated under this subdivision, or the amount
19.15equal to $600 minus five percent of federal adjusted gross income in excess of $50,000 for
19.16taxpayers with one qualified individual, or $1,200 minus five percent of federal adjusted
19.17gross income in excess of $50,000 for taxpayers with two or more qualified individuals,
19.18but in no case is the credit less than zero.
19.19EFFECTIVE DATE.This section is effective for taxable years beginning after December
19.2031, 2016.

19.21    Sec. 18. Minnesota Statutes 2016, section 290.067, subdivision 2b, is amended to read:
19.22    Subd. 2b. Inflation adjustment. The commissioner shall adjust the dollar amount of
19.23the income threshold at which the maximum credit begins to be reduced under subdivision
19.242 1 by the percentage determined pursuant to the provisions of section 1(f) of the Internal
19.25Revenue Code, except that in section 1(f)(3)(B) the word "1999" "2016" shall be substituted
19.26for the word "1992." For 2001 2018, the commissioner shall then determine the percent
19.27change from the 12 months ending on August 31, 1999 2016, to the 12 months ending on
19.28August 31, 2000 2017, and in each subsequent year, from the 12 months ending on August
19.2931, 1999 2016, to the 12 months ending on August 31 of the year preceding the taxable
19.30year. The determination of the commissioner pursuant to this subdivision must not be
19.31considered a "rule" and is not subject to the Administrative Procedure Act contained in
19.32chapter 14. The threshold amount as adjusted must be rounded to the nearest $10 amount.
19.33If the amount ends in $5, the amount is rounded up to the nearest $10 amount.
20.1EFFECTIVE DATE.This section is effective for taxable years beginning after December
20.231, 2016.

20.3    Sec. 19. Minnesota Statutes 2016, section 290.0671, subdivision 1, is amended to read:
20.4    Subdivision 1. Credit allowed. (a) An individual who is a resident of Minnesota is
20.5allowed a credit against the tax imposed by this chapter equal to a percentage of earned
20.6income. To receive a credit, a taxpayer must be eligible for a credit under section 32 of the
20.7Internal Revenue Code., except that:
20.8(1) the earned income and adjusted gross income limitations of section 32 of the Internal
20.9Revenue Code do not apply; and
20.10(2) a taxpayer with no qualifying children who has attained the age of 21 but not attained
20.11the age of 65 before the close of the taxable year and is otherwise eligible for a credit under
20.12section 32 of the Internal Revenue Code may also receive a credit.
20.13(b) For individuals with no qualifying children, the credit equals 2.10 three percent of
20.14the first $6,180 $6,550 of earned income. The credit is reduced by 2.01 three percent of
20.15earned income or adjusted gross income, whichever is greater, in excess of $8,130 $12,100,
20.16but in no case is the credit less than zero.
20.17(c) For individuals with one qualifying child, the credit equals 9.35 12.71 percent of the
20.18first $11,120 $8,420 of earned income. The credit is reduced by 6.02 5.2 percent of earned
20.19income or adjusted gross income, whichever is greater, in excess of $21,190 $21,790, but
20.20in no case is the credit less than zero.
20.21(d) For individuals with two or more qualifying children, the credit equals 11 14.94
20.22percent of the first $18,240 $13,810 of earned income. The credit is reduced by 10.82 9.2
20.23percent of earned income or adjusted gross income, whichever is greater, in excess of
20.24$25,130 $25,850, but in no case is the credit less than zero.
20.25(e) For a part-year resident, the credit must be allocated based on the percentage calculated
20.26under section 290.06, subdivision 2c, paragraph (e).
20.27(f) For a person who was a resident for the entire tax year and has earned income not
20.28subject to tax under this chapter, including income excluded under section 290.0132,
20.29subdivision 10
, the credit must be allocated based on the ratio of federal adjusted gross
20.30income reduced by the earned income not subject to tax under this chapter over federal
20.31adjusted gross income. For purposes of this paragraph, the subtractions for military pay
20.32under section 290.0132, subdivisions 11 and 12, are not considered "earned income not
20.33subject to tax under this chapter."
21.1For the purposes of this paragraph, the exclusion of combat pay under section 112 of
21.2the Internal Revenue Code is not considered "earned income not subject to tax under this
21.3chapter."
21.4(g) For tax years beginning after December 31, 2007, and before December 31, 2010,
21.5and for tax years beginning after December 31, 2017, the $8,130 $12,100 in paragraph (b),
21.6the $21,190 $21,790 in paragraph (c), and the $25,130 $25,850 in paragraph (d), after being
21.7adjusted for inflation under subdivision 7, are each increased by $3,000 for married taxpayers
21.8filing joint returns. For tax years beginning after December 31, 2008 2017, the commissioner
21.9shall annually adjust the $3,000 by the percentage determined pursuant to the provisions of
21.10section 1(f) of the Internal Revenue Code, except that in section 1(f)(3)(B), the word "2007"
21.11shall be substituted for the word "1992." For 2009 2018, the commissioner shall then
21.12determine the percent change from the 12 months ending on August 31, 2007, to the 12
21.13months ending on August 31, 2008 2017, and in each subsequent year, from the 12 months
21.14ending on August 31, 2007, to the 12 months ending on August 31 of the year preceding
21.15the taxable year. The earned income thresholds as adjusted for inflation must be rounded
21.16to the nearest $10. If the amount ends in $5, the amount is rounded up to the nearest $10.
21.17The determination of the commissioner under this subdivision is not a rule under the
21.18Administrative Procedure Act.
21.19(h)(1) For tax years beginning after December 31, 2012, and before January 1, 2014,
21.20the $5,770 in paragraph (b), the $15,080 in paragraph (c), and the $17,890 in paragraph (d),
21.21after being adjusted for inflation under subdivision 7, are increased by $5,340 for married
21.22taxpayers filing joint returns; and (2) For tax years beginning after December 31, 2013
21.232016, and before January 1, 2018, the $8,130 $12,100 in paragraph (b), the $21,190 $21,790
21.24in paragraph (c), and the $25,130 $25,850 in paragraph (d), after being adjusted for inflation
21.25under subdivision 7, are each increased by $5,000 for married taxpayers filing joint returns.
21.26For tax years beginning after December 31, 2010, and before January 1, 2012, and for tax
21.27years beginning after December 31, 2013 2016, and before January 1, 2018, the commissioner
21.28shall annually adjust the $5,000 by the percentage determined pursuant to the provisions of
21.29section 1(f) of the Internal Revenue Code, except that in section 1(f)(3)(B), the word "2008"
21.30shall be substituted for the word "1992." For 2011 2017, the commissioner shall then
21.31determine the percent change from the 12 months ending on August 31, 2008, to the 12
21.32months ending on August 31, 2010 2016, and in each subsequent year, from the 12 months
21.33ending on August 31, 2008, to the 12 months ending on August 31 of the year preceding
21.34the taxable year. The earned income thresholds as adjusted for inflation must be rounded
21.35to the nearest $10. If the amount ends in $5, the amount is rounded up to the nearest $10.
22.1The determination of the commissioner under this subdivision is not a rule under the
22.2Administrative Procedure Act.
22.3(i) The commissioner shall construct tables showing the amount of the credit at various
22.4income levels and make them available to taxpayers. The tables shall follow the schedule
22.5contained in this subdivision, except that the commissioner may graduate the transition
22.6between income brackets.
22.7EFFECTIVE DATE.This section is effective for taxable years beginning after December
22.831, 2016.

22.9    Sec. 20. Minnesota Statutes 2016, section 290.0671, subdivision 7, is amended to read:
22.10    Subd. 7. Inflation adjustment. The earned income amounts used to calculate the credit
22.11and the income thresholds at which the maximum credit begins to be reduced in subdivision
22.121 must be adjusted for inflation. The commissioner shall adjust by the percentage determined
22.13pursuant to the provisions of section 1(f) of the Internal Revenue Code, except that in section
22.141(f)(3)(B) the word "2013" "2016" shall be substituted for the word "1992." For 2015 2018,
22.15the commissioner shall then determine the percent change from the 12 months ending on
22.16August 31, 2013 2016, to the 12 months ending on August 31, 2014 2017, and in each
22.17subsequent year, from the 12 months ending on August 31, 2013 2016, to the 12 months
22.18ending on August 31 of the year preceding the taxable year. The earned income thresholds
22.19as adjusted for inflation must be rounded to the nearest $10 amount. If the amount ends in
22.20$5, the amount is rounded up to the nearest $10 amount. The determination of the
22.21commissioner under this subdivision is not a rule under the Administrative Procedure Act.
22.22EFFECTIVE DATE.This section is effective for taxable years beginning after December
22.2331, 2017.

22.24    Sec. 21. Minnesota Statutes 2016, section 290.0674, subdivision 1, is amended to read:
22.25    Subdivision 1. Credit allowed. An individual is allowed a credit against the tax imposed
22.26by this chapter in an amount equal to 75 percent of the amount paid for education-related
22.27expenses for a qualifying child in a prekindergarten educational program or in kindergarten
22.28through grade 12. For purposes of this section, "education-related expenses" means:
22.29(1) fees or tuition for instruction by an instructor under section 120A.22, subdivision
22.3010
, clause (1), (2), (3), (4), or (5), or a member of the Minnesota Music Teachers Association,
22.31and who is not a lineal ancestor or sibling of the dependent for instruction outside the regular
22.32school day or school year, including tutoring, driver's education offered as part of school
23.1curriculum, regardless of whether it is taken from a public or private entity or summer
23.2camps, in grade or age appropriate curricula that supplement curricula and instruction
23.3available during the regular school year, that assists a dependent to improve knowledge of
23.4core curriculum areas or to expand knowledge and skills under the required academic
23.5standards under section 120B.021, subdivision 1, and the elective standard under section
23.6120B.022, subdivision 1 , clause (2), and that do not include the teaching of religious tenets,
23.7doctrines, or worship, the purpose of which is to instill such tenets, doctrines, or worship;
23.8(2) expenses for textbooks, including books and other instructional materials and
23.9equipment purchased or leased for use in elementary and secondary schools in teaching
23.10only those subjects legally and commonly taught in public elementary and secondary schools
23.11in this state. "Textbooks" does not include instructional books and materials used in the
23.12teaching of religious tenets, doctrines, or worship, the purpose of which is to instill such
23.13tenets, doctrines, or worship, nor does it include books or materials for extracurricular
23.14activities including sporting events, musical or dramatic events, speech activities, driver's
23.15education, or similar programs;
23.16(3) a maximum expense of $200 per family for personal computer hardware, excluding
23.17single purpose processors, and educational software that assists a dependent to improve
23.18knowledge of core curriculum areas or to expand knowledge and skills under the required
23.19academic standards under section 120B.021, subdivision 1, and the elective standard under
23.20section 120B.022, subdivision 1, clause (2), purchased for use in the taxpayer's home and
23.21not used in a trade or business regardless of whether the computer is required by the
23.22dependent's school; and
23.23(4) the amount paid to others for transportation of a qualifying child attending an
23.24elementary or secondary school situated in Minnesota, North Dakota, South Dakota, Iowa,
23.25or Wisconsin, wherein a resident of this state may legally fulfill the state's compulsory
23.26attendance laws, which is not operated for profit, and which adheres to the provisions of
23.27the Civil Rights Act of 1964 and chapter 363A. Amounts under this clause exclude any
23.28expense the taxpayer incurred in using the taxpayer's or the qualifying child's vehicle.; and
23.29(5) fees charged for enrollment in a prekindergarten educational program, to the extent
23.30not used to claim the credit under section 290.067.
23.31For purposes of this section, "qualifying child" has the meaning given in section 32(c)(3)
23.32of the Internal Revenue Code, but is limited to children who have attained at least the age
23.33of three during the taxable year.
23.34For purposes of this section, "prekindergarten educational program" means:
24.1    (1) prekindergarten programs established by a school district under chapter 124D;
24.2    (2) preschools, nursery schools, and early childhood development programs licensed by
24.3the Department of Human Services and accredited by the National Association for the
24.4Education of Young Children or National Early Childhood Program Accreditation;
24.5    (3) Montessori programs affiliated with or accredited by the American Montessori
24.6Society or American Montessori International; and
24.7    (4) child care programs provided by family day care providers holding a current early
24.8childhood development credential approved by the commissioner of human services.
24.9EFFECTIVE DATE.This section is effective for taxable years beginning after December
24.1031, 2016.

24.11    Sec. 22. Minnesota Statutes 2016, section 290.0674, subdivision 2, is amended to read:
24.12    Subd. 2. Limitations. (a) For claimants with income not greater than $33,500 $42,000,
24.13the maximum credit allowed for a family is $1,000 $1,500 multiplied by the number of
24.14qualifying children in a prekindergarten educational program or in kindergarten through
24.15grade 12 in the family. The maximum credit for families with one qualifying child in
24.16kindergarten through grade 12 is reduced by $1 for each $4 $10 of household income over
24.17$33,500, and the maximum credit for families with two or more qualifying children in
24.18kindergarten through grade 12 is reduced by $2 for each $4 of household income over
24.19$33,500 $42,000, but in no case is the credit less than zero.
24.20For purposes of this section "income" has the meaning given in section 290.067,
24.21subdivision 2a
. In the case of a married claimant, a credit is not allowed unless a joint income
24.22tax return is filed.
24.23(b) For a nonresident or part-year resident, the credit determined under subdivision 1
24.24and the maximum credit amount in paragraph (a) must be allocated using the percentage
24.25calculated in section 290.06, subdivision 2c, paragraph (e).
24.26EFFECTIVE DATE.This section is effective for taxable years beginning after December
24.2731, 2016.

24.28    Sec. 23. Minnesota Statutes 2016, section 290.0674, is amended by adding a subdivision
24.29to read:
24.30    Subd. 6. Inflation adjustment. The income threshold at which the maximum credit
24.31begins to be reduced in subdivision 2 must be adjusted for inflation. The commissioner shall
25.1adjust the income threshold by the percentage determined pursuant to the provisions of
25.2section 1(f) of the Internal Revenue Code, except that in section 1(f)(3)(B), the word "2016"
25.3shall be substituted for the word "1992." For 2018, the commissioner shall then determine
25.4the percent change from the 12 months ending on August 31, 2016, to the 12 months ending
25.5on August 31, 2017, and in each subsequent year, from the 12 months ending August 31,
25.62016, to the 12 months ending on August 31 of the year preceding the taxable year. The
25.7income threshold as adjusted for inflation must be rounded to the nearest $10 amount. If
25.8the amount ends in $5, the amount is rounded up to the nearest $10 amount. The
25.9determination of the commissioner under this subdivision is not a rule under the
25.10Administrative Procedure Act.
25.11EFFECTIVE DATE.This section is effective for taxable years beginning after December
25.1231, 2016.

25.13    Sec. 24. Minnesota Statutes 2016, section 290.0677, subdivision 1a, is amended to read:
25.14    Subd. 1a. Credit allowed; past military service. (a) A qualified individual is allowed
25.15a credit against the tax imposed under this chapter for past military service. The credit equals
25.16$750 $1,000. The credit allowed under this subdivision is reduced by ten percent of adjusted
25.17gross income in excess of $30,000 $50,000, but in no case is the credit less than zero.
25.18    (b) For a nonresident or a part-year resident, the credit under this subdivision must be
25.19allocated based on the percentage calculated under section 290.06, subdivision 2c, paragraph
25.20(e).
25.21EFFECTIVE DATE.This section is effective for taxable years beginning after December
25.2231, 2016.

25.23    Sec. 25. [290.0682] STUDENT LOAN CREDIT.
25.24    Subdivision 1. Definitions. (a) For purposes of this section, the following terms have
25.25the meanings given.
25.26    (b) "Adjusted gross income" means federal adjusted gross income as defined in section
25.2762 of the Internal Revenue Code.
25.28    (c) "Earned income" has the meaning given in section 32(c) of the Internal Revenue
25.29Code.
25.30    (d) "Eligible individual" means a resident individual with one or more qualified education
25.31loans related to an undergraduate or graduate degree program at a postsecondary educational
25.32institution.
26.1    (e) "Eligible loan payments" means the amount the eligible individual paid during the
26.2taxable year in principal and interest on qualified education loans.
26.3    (f) "Postsecondary educational institution" means a public or nonprofit postsecondary
26.4institution eligible for state student aid under section 136A.103 or, if the institution is not
26.5located in this state, a public or nonprofit postsecondary institution participating in the
26.6federal Pell Grant program under title IV of the Higher Education Act of 1965, Public Law
26.789-329, as amended.
26.8    (g) "Qualified education loan" has the meaning given in section 221 of the Internal
26.9Revenue Code, but is limited to indebtedness incurred on behalf of the eligible individual.
26.10    Subd. 2. Credit allowed. (a) An eligible individual is allowed a credit against the tax
26.11due under this chapter.
26.12    (b) The credit for an eligible individual equals the least of:
26.13    (1) eligible loan payments minus ten percent of an amount equal to adjusted gross income
26.14in excess of $10,000, but in no case less than zero;
26.15    (2) the earned income for the taxable year of the eligible individual, if any;
26.16    (3) the sum of:
26.17    (i) the interest portion of eligible loan payments made during the taxable year; and
26.18    (ii) ten percent of the original loan amount of all qualified education loans of the eligible
26.19individual; or
26.20    (4) $750.
26.21(c) For a part-year resident, the credit must be allocated based on the percentage calculated
26.22under section 290.06, subdivision 2c, paragraph (e).
26.23(d) In the case of a married couple, each spouse is eligible for the credit in this section.
26.24    Subd. 3. Credit refundable. If the amount of credit that an individual is eligible to
26.25receive under this section exceeds the individual's tax liability under this chapter, the
26.26commissioner shall refund the excess to the individual.
26.27    Subd. 4. Appropriation. An amount sufficient to pay the refunds required by this section
26.28is appropriated to the commissioner from the general fund.
26.29EFFECTIVE DATE.This section is effective for taxable years beginning after December
26.3031, 2016.

27.1    Sec. 26. [290.0683] MINNESOTA HOUSING TAX CREDIT.
27.2    Subdivision 1. Definitions. For purposes of this section:
27.3(1) "entity" means a partnership, limited liability company taxed as a partnership, S
27.4corporation, or property with multiple owners;
27.5(2) "entity member" means a partner, member, shareholder, or owner;
27.6(3) "taxpayer" means a taxpayer as defined in section 290.01, subdivision 6, or a taxpayer
27.7as defined in section 297I.01, subdivision 16; and
27.8(4) terms defined in section 462A.39 have the meanings given in that section.
27.9    Subd. 2. Credit allowed. (a) A taxpayer is allowed a credit against the taxes imposed
27.10under this chapter and chapter 297I. The credit equals the amount allocated to the taxpayer
27.11and indicated on the eligibility statement issued to the taxpayer under section 462A.39,
27.12subdivision 3. The taxpayer may claim the amount allocated in the year in which the credit
27.13is allocated and in each of the five following taxable years.
27.14(b) A taxpayer eligible for the credit must submit to the commissioner a copy of the
27.15eligibility statement issued by the agency or suballocator with respect to the qualified
27.16Minnesota project, a copy of the project owner's tax return that must be filed as required
27.17under chapter 289A, and any other information required by the commissioner.
27.18(c) Credits granted to an entity are passed through to the entity members based on each
27.19entity member's share of the entity's assets or as specially allocated in the organizational
27.20documents as of the last day of the taxable year in which the eligibility statement was issued.
27.21If a Minnesota housing tax credit is allowed to an entity with multiple tiers of ownership,
27.22the credit is passed through to entity members pro rata or as specially allocated in the
27.23organizational documents as of the last day of the taxable year in which the eligibility
27.24statement was issued at each ownership tier.
27.25    Subd. 3. Limitations; carryover. (a) A credit allowed under this section may not exceed
27.26liability for tax under this chapter and chapter 297I.
27.27(b) If the amount of the credit under this section exceeds the limitation under paragraph
27.28(a), the excess is a credit carryover to each of the 11 succeeding taxable years. The entire
27.29amount of the excess unused credit for the taxable year must be carried first to the earliest
27.30of the taxable years to which the credit may be carried and then to each successive year to
27.31which the credit may be carried.
28.1(c) Credits under this subdivision apply against liability after any net operating loss
28.2carryover incorporated in the calculation of federal taxable income.
28.3    Subd. 4. Audit powers. Notwithstanding the eligibility statement issued by the agency
28.4or a suballocator under section 462A.38, the commissioner may utilize any audit and
28.5examination powers under chapter 270C or 289A to the extent necessary to verify that the
28.6taxpayer is eligible for the credit and to assess for the amount of any improperly claimed
28.7credit and that the owner is in compliance with the compliance agreement.
28.8EFFECTIVE DATE.This section is effective for taxable years beginning after December
28.931, 2016.

28.10    Sec. 27. [290.0684] SECTION 529 COLLEGE SAVINGS PLAN CREDIT.
28.11    Subdivision 1. Definitions. (a) For purposes of this section, the following terms have
28.12the meanings given to them.
28.13(b) "Federal adjusted gross income" has the meaning given under section 62(a) of the
28.14Internal Revenue Code.
28.15(c) "Qualified higher education expenses" has the meaning given in section 529 of the
28.16Internal Revenue Code.
28.17    Subd. 2. Credit allowed. (a) A credit is allowed to a resident individual against the tax
28.18imposed by this chapter. The credit is not allowed to an individual who is eligible to be
28.19claimed as a dependent, as defined in sections 151 and 152 of the Internal Revenue Code.
28.20(b) The amount of the credit allowed equals 50 percent of the amount contributed in a
28.21taxable year to one or more accounts in plans qualifying under section 529 of the Internal
28.22Revenue Code, reduced by any withdrawals from accounts made during the taxable year.
28.23The maximum credit is $500, subject to the phaseout in paragraphs (c) and (d). In no case
28.24is the credit less than zero.
28.25(c) For individual filers, the maximum credit is reduced by two percent of adjusted gross
28.26income in excess of $75,000.
28.27(d) For married couples filing a joint return, the maximum credit is phased out as follows:
28.28(1) for married couples with adjusted gross income in excess of $75,000, but not more
28.29than $100,000, the maximum credit is reduced by one percent of adjusted gross income in
28.30excess of $75,000;
28.31(2) for married couples with adjusted gross income in excess of $100,000, but not more
28.32than $135,000, the maximum credit is $250; and
29.1(3) for married couples with adjusted gross income in excess of $135,000, the maximum
29.2credit is $250, reduced by one percent of adjusted gross income in excess of $135,000.
29.3(e) The income thresholds in paragraphs (c) and (d) used to calculate the maximum
29.4credit must be adjusted for inflation. The commissioner shall adjust the income thresholds
29.5by the percentage determined under the provisions of section 1(f) of the Internal Revenue
29.6Code, except that in section 1(f)(3)(B) the word "2016" is substituted for the word "1992."
29.7For 2018, the commissioner shall then determine the percent change from the 12 months
29.8ending on August 31, 2016, to the 12 months ending on August 31, 2017, and in each
29.9subsequent year, from the 12 months ending on August 31, 2016, to the 12 months ending
29.10on August 31 of the year preceding the taxable year. The income thresholds as adjusted for
29.11inflation must be rounded to the nearest $10 amount. If the amount ends in $5, the amount
29.12is rounded up to the nearest $10 amount. The determination of the commissioner under this
29.13subdivision is not subject to chapter 14, including section 14.386.
29.14    Subd. 3. Credit refundable. If the amount of credit that an individual is eligible to
29.15receive under this section exceeds the individual's tax liability under this chapter, the
29.16commissioner shall refund the excess to the individual.
29.17    Subd. 4. Allocation. For a part-year resident, the credit must be allocated based on the
29.18percentage calculated under section 290.06, subdivision 2c, paragraph (e).
29.19    Subd. 5. Revocation. If an individual makes a withdrawal of contributions for a purpose
29.20other than to pay for qualified higher education expenses, then:
29.21(1) contributions used to claim the credit are considered to be the first contributions
29.22withdrawn; and
29.23(2) any credit allowed for the contributions is revoked and must be repaid by the
29.24individual in the taxable year in which the withdrawal is made.
29.25    Subd. 6. Appropriation. An amount sufficient to pay the refunds required by this section
29.26is appropriated to the commissioner from the general fund.
29.27EFFECTIVE DATE.This section is effective for taxable years beginning after December
29.2831, 2016.

29.29    Sec. 28. Minnesota Statutes 2016, section 290.0685, subdivision 1, is amended to read:
29.30    Subdivision 1. Credit allowed. (a) An eligible individual is allowed a credit against the
29.31tax imposed by this chapter equal to $2,000 for each birth for which a certificate of birth
29.32resulting in stillbirth has been issued under section 144.2151. The credit under this section
30.1is allowed only in the taxable year in which the stillbirth occurred and if the child would
30.2have been a dependent of the taxpayer as defined in section 152 of the Internal Revenue
30.3Code.
30.4(b) For a nonresident or part-year resident, the credit must be allocated based on the
30.5percentage calculated under section 290.06, subdivision 2c, paragraph (e).
30.6(c) For purposes of this section, "eligible individual" means:
30.7(1) the individual who gave birth to the child and who is also listed as a parent on the
30.8certificate of birth resulting in stillbirth; or
30.9(2) if no individual meets the requirements of clause (1), then the first parent listed on
30.10the certificate of birth resulting in stillbirth.
30.11EFFECTIVE DATE.This section is effective retroactively for taxable years beginning
30.12after December 31, 2015.

30.13    Sec. 29. [290.0686] CREDIT FOR ATTAINING MASTER'S DEGREE IN
30.14TEACHER'S LICENSURE FIELD.
30.15    Subdivision 1. Definitions. (a) For purposes of this section, the following terms have
30.16the meanings given them.
30.17(b) "Master's degree program" means a graduate-level program at an accredited university
30.18leading to a master of arts or science degree in a core content area directly related to a
30.19qualified teacher's licensure field. The master's degree program may not include pedagogy
30.20or a pedagogy component. To be eligible under this credit, a licensed elementary school
30.21teacher must pursue and complete a master's degree program in a core content area in which
30.22the teacher provides direct classroom instruction.
30.23(c) "Qualified teacher" means a person who:
30.24(1) holds a teaching license issued by the licensing division in the Department of
30.25Education on behalf of the Minnesota Board of Teaching both when the teacher begins the
30.26master's degree program and when the teacher completes the master's degree program;
30.27(2) began a master's degree program after June 30, 2017; and
30.28(3) completes the master's degree program during the taxable year.
30.29(d) "Core content area" means the academic subject of reading, English or language arts,
30.30mathematics, science, foreign languages, civics and government, economics, arts, history,
30.31or geography.
31.1    Subd. 2. Credit allowed. (a) An individual who is a qualified teacher is allowed a credit
31.2against the tax imposed under this chapter. The credit equals the lesser of $2,500 or the
31.3amount the individual paid for tuition, fees, books, and instructional materials necessary to
31.4completing the master's degree program and for which the individual did not receive
31.5reimbursement from an employer or scholarship.
31.6(b) For a nonresident or a part-year resident, the credit under this subdivision must be
31.7allocated based on the percentage calculated under section 290.06, subdivision 2c, paragraph
31.8(e).
31.9(c) A qualified teacher may claim the credit in this section only one time for each master's
31.10degree program completed in a core content area.
31.11    Subd. 3. Credit refundable. (a) If the amount of the credit for which an individual is
31.12eligible exceeds the individual's liability for tax under this chapter, the commissioner shall
31.13refund the excess to the individual.
31.14(b) The amount necessary to pay the refunds required by this section is appropriated to
31.15the commissioner from the general fund.
31.16EFFECTIVE DATE.This section is effective for taxable years beginning after December
31.1731, 2016.

31.18    Sec. 30. [290.0687] EMPLOYEE CREDIT FOR CERTAIN EMPLOYER-PROVIDED
31.19FITNESS FACILITY EXPENSES.
31.20    Subdivision 1. Credit allowed. (a) An individual is allowed a credit against the tax
31.21imposed by this chapter for employer-provided fitness facility expenses. The credit equals
31.22$2.50 for each qualifying month, and the maximum credit is $30. In the case of a married
31.23couple filing a joint return, each spouse is eligible for the credit in this section. The credit
31.24may not exceed the liability for tax under this chapter.
31.25(b) The credit is allowed to an individual whose employer either:
31.26(1) pays a portion of any fees, dues, or membership expenses on behalf of the employee
31.27to a fitness facility; or
31.28(2) reimburses the employee for direct payment of fees, dues, or membership expenses
31.29made by the employee to a fitness facility.
31.30(c) For purposes of this section, "qualifying month" means a month in which an individual
31.31uses the fitness facility for the preservation, maintenance, encouragement, or development
31.32of physical fitness on at least eight days.
32.1(d) For purposes of this section, "fitness facility" means a facility located in the state
32.2that:
32.3(1) provides instruction in a program of physical exercise; offers facilities for the
32.4preservation, maintenance, encouragement, or development of physical fitness; or is the
32.5site of such a program of a state or local government;
32.6(2) is not a private club owned and operated by its members;
32.7(3) does not offer hunting, sailing, horseback riding, or outdoor golf facilities;
32.8(4) does not have an overall function and purpose that makes the fitness facility incidental;
32.9(5) is compliant with antidiscrimination laws under chapter 363A and applicable federal
32.10antidiscrimination laws; and
32.11(6) is located off the employer's premises.
32.12(e) The commissioner shall prescribe the form and manner in which eligibility for the
32.13credit is determined.
32.14    Subd. 2. Limitation. The credit under this section applies only if the employer's payment
32.15of fees, dues, or membership expenses to a fitness facility is available on substantially the
32.16same terms to each member of a group of employees defined under a reasonable classification
32.17by the employer, but no classification may include only highly compensated employees, as
32.18defined under section 414(q) of the Internal Revenue Code, or any other group that includes
32.19only executives, directors, or other managerial employees.
32.20    Subd. 3. Nonresidents and part-year residents. For a nonresident or part-year resident,
32.21the credit must be allocated based on the percentage calculated under section 290.06,
32.22subdivision 2c, paragraph (e).
32.23EFFECTIVE DATE.This section is effective for taxable years beginning after December
32.2431, 2017.

32.25    Sec. 31. [290.0803] SOCIAL SECURITY SUBTRACTION.
32.26(a) An individual is allowed a subtraction from federal taxable income equal to Social
32.27Security benefits to the extent included in federal taxable income. The subtraction under
32.28this section is reduced by the amount of provisional income over a threshold amount, but
32.29in no case is the subtraction less than zero. For married couples filing joint returns and
32.30surviving spouses the threshold is $72,000. For all other filers the threshold is $56,000.
33.1(b) For purposes of this section, "provisional income" means modified adjusted gross
33.2income, as defined in section 86(b)(2) of the Internal Revenue Code, plus one-half of the
33.3amount of Social Security benefits received during the taxable year.
33.4(c) Notwithstanding the thresholds provided in paragraph (a), for taxable years beginning
33.5after December 31, 2016, and before January 1, 2019, the threshold for married couples
33.6filing joint returns and surviving spouses is $61,000 and the threshold for all other filers is
33.7$46,500.
33.8EFFECTIVE DATE.This section is effective for taxable years beginning after December
33.931, 2016.

33.10    Sec. 32. [290.0804] SECTION 179 SUBTRACTION.
33.11    Subdivision 1. Current year section 179 allowance. (a) In each of the five taxable
33.12years immediately following the taxable year in which an addition is required under section
33.13290.0131, subdivision 10, or its predecessor provisions, the current year allowance equals
33.14one-fifth of the addition made by the taxpayer under section 290.0131, subdivision 10.
33.15(b) For a shareholder of an S corporation, the current year allowance is reduced by the
33.16positive value of any net operating loss under section 172 of the Internal Revenue Code
33.17generated for the taxable year of the addition and, if the net operating loss exceeds the
33.18addition for the taxable year, the current year allowance is zero.
33.19(c) A taxpayer is allowed a current year section 179 allowance subtraction from federal
33.20taxable income under section 290.0132, subdivision 14, as determined under this subdivision.
33.21    Subd. 2. Carryover section 179 allowance. (a) For purposes of this subdivision, the
33.22current year allowance under subdivision 1 is the last modification allowed under section
33.23290.0132 in determining net income. If the amount allowed under subdivision 1 exceeds
33.24net income computed without regard to the current year allowance, then the excess is a
33.25carryover allowance in each of the ten succeeding taxable years. The entire amount of the
33.26carryover allowance is carried first to the earliest taxable year to which the carryover may
33.27be carried, and then to each succeeding year to which the carryover may be carried.
33.28(b) If applying paragraph (a) to a taxable year beginning after December 31, 2013, and
33.29before January 1, 2017, would result in a carryover allowance in that year, the taxpayer may
33.30use the resulting amount as a carryover allowance starting in a taxable year beginning after
33.31December 31, 2016, and the first year of the ten-year period under paragraph (a) is taxable
33.32year 2017.
34.1(c) A taxpayer is allowed a carryover section 179 allowance subtraction under section
34.2290.0132, subdivision 26, as determined under this subdivision.
34.3EFFECTIVE DATE.This section is effective for taxable years beginning after December
34.431, 2016.

34.5    Sec. 33. Minnesota Statutes 2016, section 290.091, subdivision 2, is amended to read:
34.6    Subd. 2. Definitions. For purposes of the tax imposed by this section, the following
34.7terms have the meanings given:
34.8    (a) "Alternative minimum taxable income" means the sum of the following for the taxable
34.9year:
34.10    (1) the taxpayer's federal alternative minimum taxable income as defined in section
34.1155(b)(2) of the Internal Revenue Code;
34.12    (2) the taxpayer's itemized deductions allowed in computing federal alternative minimum
34.13taxable income, but excluding:
34.14    (i) the charitable contribution deduction under section 170 of the Internal Revenue Code;
34.15    (ii) the medical expense deduction;
34.16    (iii) the casualty, theft, and disaster loss deduction; and
34.17    (iv) the impairment-related work expenses of a disabled person;
34.18    (3) for depletion allowances computed under section 613A(c) of the Internal Revenue
34.19Code, with respect to each property (as defined in section 614 of the Internal Revenue Code),
34.20to the extent not included in federal alternative minimum taxable income, the excess of the
34.21deduction for depletion allowable under section 611 of the Internal Revenue Code for the
34.22taxable year over the adjusted basis of the property at the end of the taxable year (determined
34.23without regard to the depletion deduction for the taxable year);
34.24    (4) to the extent not included in federal alternative minimum taxable income, the amount
34.25of the tax preference for intangible drilling cost under section 57(a)(2) of the Internal Revenue
34.26Code determined without regard to subparagraph (E);
34.27    (5) to the extent not included in federal alternative minimum taxable income, the amount
34.28of interest income as provided by section 290.0131, subdivision 2; and
34.29    (6) the amount of addition required by section 290.0131, subdivisions 9 to 11;
34.30    less the sum of the amounts determined under the following:
35.1    (1) interest income as defined in section 290.0132, subdivision 2;
35.2    (2) an overpayment of state income tax as provided by section 290.0132, subdivision 3,
35.3to the extent included in federal alternative minimum taxable income;
35.4    (3) the amount of investment interest paid or accrued within the taxable year on
35.5indebtedness to the extent that the amount does not exceed net investment income, as defined
35.6in section 163(d)(4) of the Internal Revenue Code. Interest does not include amounts deducted
35.7in computing federal adjusted gross income;
35.8    (4) amounts subtracted from federal taxable income as provided by section 290.0132,
35.9subdivisions 7
, 9 to 15, 17, and 21, and 24 to 27; and
35.10(5) the amount of the net operating loss allowed under section 290.095, subdivision 11,
35.11paragraph (c).
35.12    In the case of an estate or trust, alternative minimum taxable income must be computed
35.13as provided in section 59(c) of the Internal Revenue Code.
35.14    (b) "Investment interest" means investment interest as defined in section 163(d)(3) of
35.15the Internal Revenue Code.
35.16    (c) "Net minimum tax" means the minimum tax imposed by this section.
35.17    (d) "Regular tax" means the tax that would be imposed under this chapter (without regard
35.18to this section and section 290.032), reduced by the sum of the nonrefundable credits allowed
35.19under this chapter.
35.20    (e) "Tentative minimum tax" equals 6.75 percent of alternative minimum taxable income
35.21after subtracting the exemption amount determined under subdivision 3.
35.22EFFECTIVE DATE.This section is effective for taxable years beginning after December
35.2331, 2016.

35.24    Sec. 34. Minnesota Statutes 2016, section 291.005, subdivision 1, as amended by Laws
35.252017, chapter 1, section 8, is amended to read:
35.26    Subdivision 1. Scope. Unless the context otherwise clearly requires, the following terms
35.27used in this chapter shall have the following meanings:
35.28    (1) "Commissioner" means the commissioner of revenue or any person to whom the
35.29commissioner has delegated functions under this chapter.
35.30    (2) "Federal gross estate" means the gross estate of a decedent as required to be valued
35.31and otherwise determined for federal estate tax purposes under the Internal Revenue Code,
36.1increased by the value of any property in which the decedent had a qualifying income interest
36.2for life and for which an election was made under section 291.03, subdivision 1d, for
36.3Minnesota estate tax purposes, but was not made for federal estate tax purposes.
36.4    (3) "Internal Revenue Code" means the United States Internal Revenue Code of 1986,
36.5as amended through December 16, 2016.
36.6    (4) "Minnesota gross estate" means the federal gross estate of a decedent after (a)
36.7excluding therefrom any property included in the estate which has its situs outside Minnesota,
36.8and (b) including any property omitted from the federal gross estate which is includable in
36.9the estate, has its situs in Minnesota, and was not disclosed to federal taxing authorities.
36.10    (5) "Nonresident decedent" means an individual whose domicile at the time of death
36.11was not in Minnesota.
36.12    (6) "Personal representative" means the executor, administrator or other person appointed
36.13by the court to administer and dispose of the property of the decedent. If there is no executor,
36.14administrator or other person appointed, qualified, and acting within this state, then any
36.15person in actual or constructive possession of any property having a situs in this state which
36.16is included in the federal gross estate of the decedent shall be deemed to be a personal
36.17representative to the extent of the property and the Minnesota estate tax due with respect
36.18to the property.
36.19    (7) "Resident decedent" means an individual whose domicile at the time of death was
36.20in Minnesota. The provisions of section 290.01, subdivision 7, paragraphs (c) and (d), apply
36.21to determinations of domicile under this chapter.
36.22    (8) "Situs of property" means, with respect to:
36.23    (i) real property, the state or country in which it is located;
36.24    (ii) tangible personal property, the state or country in which it was normally kept or
36.25located at the time of the decedent's death or for a gift of tangible personal property within
36.26three years of death, the state or country in which it was normally kept or located when the
36.27gift was executed;
36.28    (iii) a qualified work of art, as defined in section 2503(g)(2) of the Internal Revenue
36.29Code, owned by a nonresident decedent and that is normally kept or located in this state
36.30because it is on loan to an organization, qualifying as exempt from taxation under section
36.31501(c)(3) of the Internal Revenue Code, that is located in Minnesota, the situs of the art is
36.32deemed to be outside of Minnesota, notwithstanding the provisions of item (ii); and
37.1    (iv) intangible personal property, the state or country in which the decedent was domiciled
37.2at death or for a gift of intangible personal property within three years of death, the state or
37.3country in which the decedent was domiciled when the gift was executed.
37.4    For a nonresident decedent with an ownership interest in a pass-through entity with
37.5assets that include real or tangible personal property, situs of the real or tangible personal
37.6property, including qualified works of art, is determined as if the pass-through entity does
37.7not exist and the real or tangible personal property is personally owned by the decedent. If
37.8the pass-through entity is owned by a person or persons in addition to the decedent, ownership
37.9of the property is attributed to the decedent in proportion to the decedent's capital ownership
37.10share of the pass-through entity.
37.11(9) "Pass-through entity" includes the following:
37.12(i) an entity electing S corporation status under section 1362 of the Internal Revenue
37.13Code;
37.14(ii) an entity taxed as a partnership under subchapter K of the Internal Revenue Code;
37.15(iii) a single-member limited liability company or similar entity, regardless of whether
37.16it is taxed as an association or is disregarded for federal income tax purposes under Code
37.17of Federal Regulations, title 26, section 301.7701-3; or
37.18(iv) a trust to the extent the property is includible in the decedent's federal gross estate;
37.19but excludes
37.20    (v) an entity whose ownership interest securities are traded on an exchange regulated
37.21by the Securities and Exchange Commission as a national securities exchange under section
37.226 of the Securities Exchange Act, United States Code, title 15, section 78f.
37.23EFFECTIVE DATE.This section is effective retroactively for estates of decedents
37.24dying after December 31, 2016.

37.25    Sec. 35. Minnesota Statutes 2016, section 291.03, subdivision 11, is amended to read:
37.26    Subd. 11. Recapture tax. (a) If, within three years after the decedent's death and before
37.27the death of the qualified heir, the qualified heir disposes of any interest in the qualified
37.28property, other than by a disposition to a family member, or a family member ceases to
37.29satisfy the requirement under subdivision 9, clause (7); or 10, clause (5), an additional estate
37.30tax is imposed on the property. In the case of a sole proprietor, if the qualified heir replaces
37.31qualified small business property excluded under subdivision 9 with similar property, then
37.32the qualified heir will not be treated as having disposed of an interest in the qualified property.
38.1(b) The amount of the additional tax equals the amount of the exclusion claimed by the
38.2estate under subdivision 8, paragraph (d), multiplied by 16 percent.
38.3(c) The additional tax under this subdivision is due on the day which is six months after
38.4the date of the disposition or cessation in paragraph (a).
38.5(d) The tax under this subdivision does not apply to the following: acquisition of title
38.6or possession of the qualified property by a federal, state, or local government unit, or any
38.7other entity with the power of eminent domain for a public purpose, as defined in section
38.8117.025, subdivision 11, within the three-year holding period.
38.9EFFECTIVE DATE.This section is effective retroactively for estates of decedents
38.10dying after June 30, 2011.

38.11    Sec. 36. Minnesota Statutes 2016, section 297I.20, is amended by adding a subdivision
38.12to read:
38.13    Subd. 4. Minnesota housing tax credit. An insurance company may claim a credit
38.14against the premiums tax imposed under this chapter equal to the amount indicated on the
38.15eligibility statement issued to the company under section 462A.39, subdivision 3. If the
38.16amount of the credit exceeds the liability for tax under this chapter, the excess is a credit
38.17carryover to each of the 11 succeeding taxable years. The entire amount of the excess unused
38.18credit for the taxable year must be carried first to the earliest of the taxable years to which
38.19the credit may be carried and then to each successive year to which the credit may be carried.
38.20This credit does not affect the calculation of police and fire aid under section 69.021.
38.21EFFECTIVE DATE.This section is effective for taxable years beginning after December
38.2231, 2016.

38.23    Sec. 37. [462A.39] MINNESOTA HOUSING TAX CREDIT.
38.24    Subdivision 1. Definitions. (a) For purposes of this section, the following terms have
38.25the meanings given unless the context clearly requires otherwise.
38.26(b) "Compliance agreement" means an agreement:
38.27(1) between the owner of a qualified Minnesota project and the agency or suballocator;
38.28(2) that is recorded as an affordable housing restriction on the real property on which
38.29the qualified Minnesota project is located; and
38.30(3) that requires the project to be operated under the requirements of this section for the
38.31compliance period.
39.1The agreement may be subordinated to the lien of a bank or other institutional lender
39.2providing financing to the qualified Minnesota project upon the request of the bank or
39.3lender.
39.4(c) "Compliance period" means the 15-year period beginning with the first taxable year
39.5a credit is allowed under this section.
39.6(d) "Eligibility statement" means a statement issued by the agency or suballocator to the
39.7owner certifying that a project is a qualified Minnesota project and documenting allocation
39.8of the Minnesota housing tax credit. The eligibility statement must specify the annual amount
39.9of the credit allocated to the project for the taxable year and for the five following taxable
39.10years and be in a form prescribed by the commissioner of the agency, in consultation with
39.11the commissioner of revenue.
39.12(e) "Federal low-income housing tax credit" means the federal tax credit provided in
39.13section 42 of the Internal Revenue Code.
39.14(f) "Greater Minnesota" means the area of Minnesota located outside of the metropolitan
39.15area as defined in section 473.121, subdivision 2.
39.16(g) "Internal Revenue Code" has the meaning given in section 290.01, subdivision 31.
39.17(h) "Minnesota credit period" means the six taxable years beginning in the taxable year
39.18in which a credit is allocated under subdivision 2.
39.19(i) "Owner" means the owner of a qualified Minnesota project.
39.20(j) "Qualified Minnesota project" means a low-income housing project that is:
39.21(1) located in Minnesota;
39.22(2) financed with tax-exempt bonds pursuant to section 42(i)(2) of the Internal Revenue
39.23Code;
39.24(3) determined by the agency to be eligible for a federal low-income housing tax credit
39.25without regard to whether or not a federal low-income housing credit is allocated to the
39.26project; and
39.27(4) a project for which the owner has entered into a compliance agreement with the
39.28agency or the suballocator that is enforceable by state and local agencies.
39.29(k) "Suballocator" means an allocating agency, other than the agency, of low-income
39.30federal housing credits and credits under this section as provided in section 462A.222.
39.31(l) "Taxpayer" has the meaning given in section 290.0683, subdivision 1.
40.1(m) Terms not otherwise defined in this subdivision have the meanings given in section
40.242 of the Internal Revenue Code.
40.3    Subd. 2. Minnesota housing tax credit; allocation. (a) The agency and all suballocators
40.4may annually allocate credits during a four-year period beginning January 1, 2017, and
40.5ending December 31, 2020. The amount of credits that may be allocated each year is the
40.6sum of:
40.7(1) $7,000,000; and
40.8(2) any unused tax credits, if any, for the preceding calendar years.
40.9(b) The agency shall allocate credits only to qualified Minnesota projects that the agency
40.10determines:
40.11(1) are eligible for the federal low-income housing tax credit; and
40.12(2) are not financially feasible without the credit.
40.13(c) The agency must allocate 50 percent of the total amount allocated to qualified
40.14Minnesota projects in greater Minnesota.
40.15(d) The agency may not allocate more than one credit to any one qualified Minnesota
40.16project.
40.17(e) The allocation to any one qualified Minnesota project equals one-sixth of the total
40.18federal low-income housing tax credit allowable over the ten-year federal credit period,
40.19without regard to whether the project was allowed a federal low-income housing tax credit.
40.20    Subd. 3. Credit allowed. When the agency or a suballocator allocates a credit amount
40.21to the owner of a project, the agency or suballocator must issue an eligibility statement to
40.22the owner. The owner may claim the amount allocated in each year of the Minnesota credit
40.23period.
40.24    Subd. 4. Credit duration. Except for unused credits carried forward under section
40.25290.0683, the agency may allocate a credit and issue an eligibility statement to a taxpayer
40.26for a Minnesota housing tax credit for a project one time, with the credit allowed in each
40.27year of the Minnesota credit period.
40.28    Subd. 5. Recapture; repayment. (a) If within the Minnesota credit period the agency
40.29or suballocator finds that a qualified project issued an eligibility statement is not meeting
40.30the terms of the compliance agreement, the owner must repay the following percentage of
40.31the credit awarded to the project by the agency or the suballocator:
40.32
Year of the
Percentage of credit required
41.1
compliance period:
to be repaid:
41.2
First
100 percent
41.3
Second
83 percent
41.4
Third
66 percent
41.5
Fourth
49 percent
41.6
Fifth
32 percent
41.7
Sixth and later
16 percent
41.8(b) No holder of the credit other than the owner is responsible for repayment of the
41.9credit.
41.10(c) Amounts repaid under this subdivision are credited to the general fund.
41.11    Subd. 6. Data privacy. Data related to Minnesota housing tax credits are nonpublic
41.12data, or private data on individuals, as defined in section 13.02, subdivision 9 or 12, except
41.13that for each eligibility statement issued under subdivision 3 the location of the qualified
41.14Minnesota housing project is public.
41.15    Subd. 7. Report. (a) By January 15 of each year following a year in which the agency
41.16allocates a credit under this section, the agency shall submit a written report to the chairs
41.17and ranking minority members of the legislative committees with jurisdiction over housing
41.18and taxes, in compliance with sections 3.195 and 3.197, on the success and efficiency of
41.19the Minnesota housing tax credit program.
41.20(b) The report must:
41.21(1) specify the number of qualified Minnesota projects that were allocated tax credits
41.22in the year and the total number of housing units supported in each project;
41.23(2) provide descriptive information about each qualified Minnesota housing project that
41.24was allocated credits, including:
41.25(i) the geographic location of the project; and
41.26(ii) demographic information about residents intended to be served by the project,
41.27including household type, income levels, and rents or set-asides; and
41.28(3) provide housing market and demographic information that demonstrates how the
41.29qualified Minnesota projects that were allocated tax credits address the need for affordable
41.30housing in the communities they serve as well as information about any remaining disparities
41.31in affordability of housing in those communities.
41.32EFFECTIVE DATE.This section is effective the day following final enactment with
41.33credit allocations allowed for taxable years beginning after December 31, 2016.

42.1    Sec. 38. [462D.01] CITATION.
42.2This chapter may be cited as the "First-Time Home Buyer Savings Account Act."
42.3EFFECTIVE DATE.This section is effective the day following final enactment.

42.4    Sec. 39. [462D.02] DEFINITIONS.
42.5    Subdivision 1. Definitions. For purposes of this chapter, the following terms have the
42.6meanings given.
42.7    Subd. 2. Account holder. "Account holder" means an individual who establishes,
42.8individually or jointly with one or more other individuals, a first-time home buyer savings
42.9account.
42.10    Subd. 3. Allowable closing costs. "Allowable closing costs" means a disbursement listed
42.11on a settlement statement for the purchase of a single-family residence in Minnesota by a
42.12qualified beneficiary.
42.13    Subd. 4. Commissioner. "Commissioner" means the commissioner of revenue.
42.14    Subd. 5. Eligible costs. "Eligible costs" means the down payment and allowable closing
42.15costs for the purchase of a single-family residence in Minnesota by a qualified beneficiary.
42.16Eligible costs include paying for the cost of construction of or financing the construction
42.17of a single-family residence.
42.18    Subd. 6. Financial institution. "Financial institution" means a bank, bank and trust,
42.19trust company with banking powers, savings bank, savings association, or credit union,
42.20organized under the laws of this state, any other state, or the United States; an industrial
42.21loan and thrift under chapter 53 or the laws of another state and authorized to accept deposits;
42.22or a money market mutual fund registered under the federal Investment Company Act of
42.231940 and regulated under rule 2a-7, promulgated by the Securities and Exchange Commission
42.24under that act.
42.25    Subd. 7. First-time home buyer. "First-time home buyer" means an individual, and if
42.26married, the individual's spouse, who has no present ownership interest in a principal
42.27residence during the three-year period ending on the earlier of:
42.28(1) the date of the purchase of the single-family residence funded, in part, with proceeds
42.29from the first-time home buyer savings account; or
42.30(2) the close of the taxable year for which a subtraction is claimed under sections
42.31290.0132 and 462D.06.
43.1    Subd. 8. First-time home buyer savings account. "First-time home buyer savings
43.2account" or "account" means an account with a financial institution that an account holder
43.3designates as a first-time home buyer savings account, as provided in section 462D.03, to
43.4pay or reimburse eligible costs for the purchase of a single-family residence by a qualified
43.5beneficiary.
43.6    Subd. 9. Internal Revenue Code. "Internal Revenue Code" has the meaning given in
43.7section 290.01.
43.8    Subd. 10. Principal residence. "Principal residence" has the meaning given in section
43.9121 of the Internal Revenue Code.
43.10    Subd. 11. Qualified beneficiary. "Qualified beneficiary" means a first-time home buyer
43.11who is a Minnesota resident and is designated as the qualified beneficiary of a first-time
43.12home buyer savings account by the account holder.
43.13    Subd. 12. Single-family residence. "Single-family residence" means a single-family
43.14residence located in this state and owned and occupied by or to be occupied by a qualified
43.15beneficiary as the qualified beneficiary's principal residence, which may include a
43.16manufactured home, trailer, mobile home, condominium unit, townhome, or cooperative.
43.17EFFECTIVE DATE.This section is effective the day following final enactment.

43.18    Sec. 40. [462D.03] ESTABLISHMENT OF ACCOUNTS.
43.19    Subdivision 1. Accounts established. An individual may open an account with a financial
43.20institution and designate the account as a first-time home buyer savings account to be used
43.21to pay or reimburse the designated qualified beneficiary's eligible costs.
43.22    Subd. 2. Designation of qualified beneficiary. (a) The account holder must designate
43.23a first-time home buyer as the qualified beneficiary of the account by April 15 of the year
43.24following the taxable year in which the account was established. The account holder may
43.25be the qualified beneficiary. The account holder may change the designated qualified
43.26beneficiary at any time, but no more than one qualified beneficiary may be designated for
43.27an account at any one time. For purposes of the one beneficiary restriction, a married couple
43.28qualifies as one beneficiary. Changing the designated qualified beneficiary of an account
43.29does not affect computation of the ten-year period under section 462D.06, subdivision 2.
43.30(b) The commissioner shall establish a process for account holders to notify the state
43.31that permits recording of the account, the account holder or holders, any transfers under
43.32section 462D.04, subdivision 2, and the designated qualified beneficiary for each account.
44.1This may be done upon filing the account holder's income tax return or in any other way
44.2the commissioner determines to be appropriate.
44.3    Subd. 3. Joint account holders. An individual may jointly own a first-time home buyer
44.4account with another person if the joint account holders file a married joint income tax
44.5return.
44.6    Subd. 4. Multiple accounts. (a) An individual may be the account holder of more than
44.7one first-time home buyer savings account, but must not hold or own multiple accounts that
44.8designate the same qualified beneficiary.
44.9(b) An individual may be designated as the qualified beneficiary on more than one
44.10first-time home buyer savings account.
44.11    Subd. 5. Contributions. Only cash may be contributed to a first-time home buyer savings
44.12account. Individuals other than the account holder may contribute to an account. No limitation
44.13applies to the amount of contributions that may be made to or retained in a first-time home
44.14buyer savings account.
44.15EFFECTIVE DATE.This section is effective the day following final enactment.

44.16    Sec. 41. [462D.04] ACCOUNT HOLDER RESPONSIBILITIES.
44.17    Subdivision 1. Expenses; reporting. The account holder must:
44.18(1) not use funds in a first-time home buyer savings account to pay expenses of
44.19administering the account, except that a service fee may be deducted from the account by
44.20the financial institution in which the account is held; and
44.21(2) submit to the commissioner, in the form and manner required by the commissioner:
44.22(i) detailed information regarding the first-time home buyer savings account, including
44.23a list of transactions for the account during the taxable year and the Form 1099 issued by
44.24the financial institution for the account for the taxable year; and
44.25(ii) upon withdrawal of funds from the account, a detailed account of the eligible costs
44.26for which the account funds were expended and a statement of the amount of funds remaining
44.27in the account, if any.
44.28    Subd. 2. Transfers. An account holder may withdraw funds, in whole or part, from a
44.29first-time home buyer savings account and deposit the funds in another first-time home
44.30buyer savings account held by a different financial institution or the same financial institution.
44.31EFFECTIVE DATE.This section is effective the day following final enactment.

45.1    Sec. 42. [462D.05] FINANCIAL INSTITUTIONS.
45.2(a) A financial institution is not required to take any action to ensure compliance with
45.3this chapter, including to:
45.4(1) designate an account, designate qualified beneficiaries, or modify the financial
45.5institution's account contracts or systems in any way;
45.6(2) track the use of money withdrawn from a first-time home buyer savings account;
45.7(3) allocate funds in a first-time home buyer savings account among joint account holders
45.8or multiple qualified beneficiaries; or
45.9(4) report any information to the commissioner or any other government that is not
45.10otherwise required by law.
45.11(b) A financial institution is not responsible or liable for:
45.12(1) determining or ensuring that an account satisfies the requirements of this chapter or
45.13that its funds are used for eligible costs; or
45.14(2) reporting or remitting taxes or penalties related to the use of a first-time home buyer
45.15savings account.
45.16EFFECTIVE DATE.This section is effective the day following final enactment.

45.17    Sec. 43. [462D.06] SUBTRACTION; ADDITION; ADDITIONAL TAX.
45.18    Subdivision 1. Subtraction. (a) An account holder is allowed a subtraction from federal
45.19taxable income equal to the sum of:
45.20(1) the amount the individual contributed to a first-time home buyer savings account
45.21during the taxable year not to exceed $5,000, or $10,000 for a married couple filing a joint
45.22return; and
45.23(2) interest or dividends earned on the first-time home buyer savings account during the
45.24taxable year.
45.25(b) The subtraction under paragraph (a) is allowed each year in which a contribution is
45.26made for the ten taxable years including and following the taxable year in which the account
45.27was established. The total subtraction for all taxable years and for all first-time home buyer
45.28accounts established by the individual for a qualified beneficiary is limited to $50,000. No
45.29person other than the account holder who deposits funds in a first-time home buyer savings
45.30account is allowed a subtraction under this section.
46.1    Subd. 2. Addition. (a) An account holder must add to federal taxable income the sum
46.2of the following amounts:
46.3(1) any amount withdrawn from a first-time home buyer savings account during the
46.4taxable year and used neither to pay eligible costs nor for a transfer permitted under section
46.5462D.04, subdivision 2; and
46.6(2) any amount remaining in the first-time home buyer savings account at the close of
46.7the tenth taxable year after the taxable year in which the account was established.
46.8(b) For an account that received a transfer under section 462D.04, subdivision 2, the
46.9ten-year period under paragraph (a), clause (2), ends at the close of the earliest taxable year
46.10that applies to either account under that clause.
46.11    Subd. 3. Additional tax. The account holder is liable for an additional tax equal to ten
46.12percent of the addition under subdivision 2 for the taxable year. This amount must be added
46.13to the amount due under section 290.06. The tax under this subdivision does not apply to:
46.14(1) a withdrawal because of the account holder's or designated qualified beneficiary's
46.15death or disability; and
46.16(2) a disbursement of assets of the account under federal bankruptcy law.
46.17EFFECTIVE DATE.This section is effective for taxable years beginning after December
46.1831, 2016.

46.19    Sec. 44. REPEALER.
46.20Minnesota Statutes 2016, section 290.067, subdivision 2, is repealed.
46.21EFFECTIVE DATE. This section is effective for taxable years beginning after
46.22December 31, 2016.

46.23ARTICLE 2
46.24PROPERTY TAX

46.25    Section 1. Minnesota Statutes 2016, section 40A.18, subdivision 2, is amended to read:
46.26    Subd. 2. Allowed commercial and industrial operations. (a) Commercial and industrial
46.27operations are not allowed on land within an agricultural preserve except:
46.28(1) small on-farm commercial or industrial operations normally associated with and
46.29important to farming in the agricultural preserve area;
47.1(2) storage use of existing farm buildings that does not disrupt the integrity of the
47.2agricultural preserve; and
47.3(3) small commercial use of existing farm buildings for trades not disruptive to the
47.4integrity of the agricultural preserve such as a carpentry shop, small scale mechanics shop,
47.5and similar activities that a farm operator might conduct.; and
47.6(4) wireless communication installments and related equipment and structure capable
47.7of providing technology potentially beneficial to farming activities.
47.8    (b) For purposes of paragraph (a), clauses (2) and (3), "existing" in clauses (2) and (3)
47.9means existing on August 1, 1989.
47.10EFFECTIVE DATE.This section is effective the day following final enactment.

47.11    Sec. 2. [103C.333] COUNTY LEVY AUTHORITY.
47.12Notwithstanding any other law to the contrary, a county levying a tax under section
47.13103C.331 shall not include any taxes levied under those authorities in the levy certified
47.14under section 275.07, subdivision 1, paragraph (a). A county levying under section 103C.331
47.15shall separately certify that amount, and the auditor shall extend that levy as a special taxing
47.16district levy under sections 275.066 and 275.07, subdivision 1, paragraph (b).
47.17EFFECTIVE DATE.This section is effective for certifications made in 2017 and
47.18thereafter.

47.19    Sec. 3. Minnesota Statutes 2016, section 272.02, subdivision 23, is amended to read:
47.20    Subd. 23. Secondary liquid agricultural chemical containment facilities. Secondary
47.21containment tanks, cache basins, and that portion of the structure needed for the containment
47.22facility used to confine agricultural chemicals as defined in section 18D.01, subdivision 3,
47.23as required by the commissioner of agriculture under chapter 18B or 18C, berms used by
47.24a reseller to contain agricultural chemical spills from primary storage containers and prevent
47.25runoff or leaching of liquid agricultural chemicals as defined in section 18D.01, subdivision
47.263, are exempt. For purposes of this subdivision, "reseller" means a person licensed by the
47.27commissioner of agriculture under section 18B.316 or 18C.415.
47.28EFFECTIVE DATE.This section is effective beginning with taxes payable in 2016
47.29provided that nothing in this section shall cause property that was classified as exempt
47.30property for taxes payable in 2016 to lose its exempt status for taxes payable in that year.

48.1    Sec. 4. Minnesota Statutes 2016, section 272.02, subdivision 86, is amended to read:
48.2    Subd. 86. Apprenticeship training facilities. All or a portion of a building used
48.3exclusively for a state-approved apprenticeship program through the Department of Labor
48.4and Industry is exempt if:
48.5(1) it is owned by a nonprofit organization or a nonprofit trust, and operated by a nonprofit
48.6organization or a nonprofit trust;
48.7(2) the program participants receive no compensation; and
48.8(3) it is located:
48.9(i) in the Minneapolis and St. Paul standard metropolitan statistical area as determined
48.10by the 2000 federal census;
48.11(ii) in a city outside the Minneapolis and St. Paul standard metropolitan statistical area
48.12that has a population of 7,400 or greater according to the most recent federal census; or
48.13(iii) in a township that has a population greater than 2,000 1,400 but less than 3,000
48.14determined by the 2000 federal census and the building was previously used by a school
48.15and was exempt for taxes payable in 2010.
48.16Use of the property for advanced skills training of incumbent workers does not disqualify
48.17the property for the exemption under this subdivision. This exemption includes up to five
48.18acres of the land on which the building is located and associated parking areas on that land,
48.19except that if the building meets the requirements of clause (3), item (iii), then the exemption
48.20includes up to ten acres of land on which the building is located and associated parking
48.21areas on that land. If a parking area associated with the facility is used for the purposes of
48.22the facility and for other purposes, a portion of the parking area shall be exempt in proportion
48.23to the square footage of the facility used for purposes of apprenticeship training.

48.24    Sec. 5. Minnesota Statutes 2016, section 272.02, is amended by adding a subdivision to
48.25read:
48.26    Subd. 100. Electric generation facility; personal property. (a) Notwithstanding
48.27subdivision 9, clause (a), attached machinery and other personal property that is part of an
48.28electric generation facility with more than 35 megawatts and less than 40 megawatts of
48.29installed capacity and that meets the requirements of this subdivision is exempt from taxation
48.30and payments in lieu of taxation. The facility must:
48.31(1) be designed to utilize natural gas as a primary fuel;
49.1(2) be owned and operated by a municipal power agency as defined in section 453.52,
49.2subdivision 8;
49.3(3) be located within 800 feet of an existing natural gas pipeline;
49.4(4) satisfy a resource deficiency identified in an approved integrated resource plan filed
49.5under section 216B.2422;
49.6(5) be located outside the metropolitan area as defined under section 473.121, subdivision
49.72; and
49.8(6) have received, by resolution, the approval of the governing bodies of the city and
49.9county in which it is located for the exemption of personal property provided by this
49.10subdivision.
49.11(b) Construction of the facility must have been commenced after January 1, 2015, and
49.12before January 1, 2017. Property eligible for this exemption does not include electric
49.13transmission lines and interconnections or gas pipelines and interconnections appurtenant
49.14to the property or the facility.
49.15EFFECTIVE DATE.This section is effective the day following final enactment.

49.16    Sec. 6. Minnesota Statutes 2016, section 272.0213, is amended to read:
49.17272.0213 LEASED SEASONAL-RECREATIONAL LAND.
49.18    (a) A county board may elect, by resolution, to Qualified lands, as defined in this section,
49.19are exempt from taxation, including the tax under section 273.19, qualified lands. "Qualified
49.20lands" for purposes of this section means property land that:
49.21    (1) is owned by a county, city, town, or the state; and
49.22    (2) is rented by the entity for noncommercial seasonal-recreational or, noncommercial
49.23seasonal-recreational residential use; and, or class 1c commercial seasonal-recreational
49.24residential use.
49.25    (3) was rented for the purposes specified in clause (2) and was exempt from taxation
49.26for property taxes payable in 2008.
49.27(b) Lands owned by the federal government and rented for noncommercial
49.28seasonal-recreational or, noncommercial seasonal-recreational residential, or class 1c
49.29commercial seasonal-recreational residential use are exempt from taxation, including the
49.30tax under section 273.19.
49.31EFFECTIVE DATE.This section is effective beginning with taxes payable in 2018.

50.1    Sec. 7. Minnesota Statutes 2016, section 272.029, subdivision 2, is amended to read:
50.2    Subd. 2. Definitions. (a) For the purposes of this section, the term:
50.3(1) "wind energy conversion system" has the meaning given in section 216C.06,
50.4subdivision 19
, and also includes a substation that is used and owned by one or more wind
50.5energy conversion facilities;
50.6(2) "large scale wind energy conversion system" means a wind energy conversion system
50.7of more than 12 megawatts, as measured by the nameplate capacity of the system or as
50.8combined with other systems as provided in paragraph (b);
50.9(3) "medium scale wind energy conversion system" means a wind energy conversion
50.10system of over two and not more than 12 megawatts, as measured by the nameplate capacity
50.11of the system or as combined with other systems as provided in paragraph (b); and
50.12(4) "small scale wind energy conversion system" means a wind energy conversion system
50.13of two megawatts and under, as measured by the nameplate capacity of the system or as
50.14combined with other systems as provided in paragraph (b).
50.15(b) For systems installed and contracted for after January 1, 2002, the total size of a
50.16wind energy conversion system under this subdivision shall be determined according to this
50.17paragraph. Unless the systems are interconnected with different distribution systems, the
50.18nameplate capacity of one wind energy conversion system shall be combined with the
50.19nameplate capacity of any other wind energy conversion system that is:
50.20(1) located within five miles of the wind energy conversion system;
50.21(2) constructed within the same calendar year as the wind energy conversion system;
50.22and
50.23(3) under common ownership.
50.24In the case of a dispute, the commissioner of commerce shall determine the total size of
50.25the system, and shall draw all reasonable inferences in favor of combining the systems.
50.26(c) In making a determination under paragraph (b), the commissioner of commerce may
50.27determine that two wind energy conversion systems are under common ownership when
50.28the underlying ownership structure contains similar the same persons or entities, even if the
50.29ownership shares differ between the two systems. Wind energy conversion systems are not
50.30under common ownership solely because the same person or entity provided equity financing
50.31for the systems. Wind energy conversion systems that were determined by the commissioner
50.32of commerce to be eligible for a renewable energy production incentive under section
51.1216C.41 are not under common ownership unless a change in the qualifying owner was
51.2made to an owner of another wind energy conversion system subsequent to the determination
51.3by the commissioner of commerce.
51.4EFFECTIVE DATE.This section is effective the day following final enactment.

51.5    Sec. 8. Minnesota Statutes 2016, section 272.162, is amended to read:
51.6272.162 RESTRICTIONS ON TRANSFERS OF SPECIFIC PARTS.
51.7    Subdivision 1. Conditions restricting transfer. When a deed or other instrument
51.8conveying a parcel of land is presented to the county auditor for transfer or division under
51.9sections 272.12, 272.16, and 272.161, the auditor shall not transfer or divide the land or its
51.10net tax capacity in the official records and shall not certify the instrument as provided in
51.11section 272.12, if:
51.12(a) The land conveyed is less than a whole parcel of land as charged in the tax lists;
51.13(b) The part conveyed appears within the area of application of municipal or county
51.14subdivision regulations adopted and filed under section 394.35 or section 462.36, subdivision
51.151
; and
51.16(c) The part conveyed is part of or constitutes a subdivision as defined in section 462.352,
51.17subdivision 12
.
51.18    Subd. 2. Conditions allowing transfer. (a) Notwithstanding the provisions of subdivision
51.191, the county auditor may transfer or divide the land and its net tax capacity and may certify
51.20the instrument if the instrument contains a certification by the clerk of the municipality or
51.21designated county planning official:
51.22(a) (1) that the municipality's or county's subdivision regulations do not apply;
51.23(b) (2) that the subdivision has been approved by the governing body of the municipality
51.24or county; or
51.25(c) (3) that the restrictions on the division of taxes and filing and recording have been
51.26waived by resolution of the governing body of the municipality or county in the particular
51.27case because compliance would create an unnecessary hardship and failure to comply would
51.28not interfere with the purpose of the regulations.
51.29(b) If any of the conditions for certification by the municipality or county as provided
51.30in this subdivision exist and the municipality or county does not certify that they exist within
51.3124 hours after the instrument of conveyance has been presented to the clerk of the
52.1municipality or designated county planning official, the provisions of subdivision 1 do not
52.2apply.
52.3(c) If an unexecuted instrument is presented to the municipality or county and any of
52.4the conditions for certification by the municipality or county as provided in this subdivision
52.5exist, the unexecuted instrument must be certified by the clerk of the municipality or the
52.6designated county planning official.
52.7    Subd. 3. Applicability of restrictions. (a) This section does not apply to the exceptions
52.8set forth in section 272.12.
52.9(b) This section applies only to land within municipalities or counties which choose to
52.10be governed by its provisions. A municipality or county may choose to have this section
52.11apply to the property within its boundaries by filing a certified copy of a resolution of its
52.12governing body making that choice with the auditor and recorder of the county in which it
52.13is located.
52.14EFFECTIVE DATE.This section is effective the day following final enactment.

52.15    Sec. 9. Minnesota Statutes 2016, section 273.124, subdivision 3a, is amended to read:
52.16    Subd. 3a. Manufactured home park cooperative. (a) When a manufactured home park
52.17is owned by a corporation or association organized under chapter 308A or 308B, and each
52.18person who owns a share or shares in the corporation or association is entitled to occupy a
52.19lot within the park, the corporation or association may claim homestead treatment for the
52.20park. Each lot must be designated by legal description or number, and each lot is limited to
52.21not more than one-half acre of land.
52.22    (b) The manufactured home park shall be entitled to homestead treatment if all of the
52.23following criteria are met:
52.24    (1) the occupant or the cooperative corporation or association is paying the ad valorem
52.25property taxes and any special assessments levied against the land and structure either
52.26directly, or indirectly through dues to the corporation or association; and
52.27    (2) the corporation or association organized under chapter 308A or 308B is wholly
52.28owned by persons having a right to occupy a lot owned by the corporation or association.
52.29    (c) A charitable corporation, organized under the laws of Minnesota with no outstanding
52.30stock, and granted a ruling by the Internal Revenue Service for 501(c)(3) tax-exempt status,
52.31qualifies for homestead treatment with respect to a manufactured home park if its members
53.1hold residential participation warrants entitling them to occupy a lot in the manufactured
53.2home park.
53.3    (d) "Homestead treatment" under this subdivision means the classification rate provided
53.4for class 4c property classified under section 273.13, subdivision 25, paragraph (d), clause
53.5(5), item (ii)., and the homestead market value exclusion under section 273.13, subdivision
53.635, does not apply and the property taxes assessed against the park shall not be included in
53.7the determination of taxes payable for rent paid under section 290A.03.
53.8EFFECTIVE DATE.This section is effective beginning with claims for taxes payable
53.9in 2018.

53.10    Sec. 10. Minnesota Statutes 2016, section 273.124, subdivision 14, is amended to read:
53.11    Subd. 14. Agricultural homesteads; special provisions. (a) Real estate of less than ten
53.12acres that is the homestead of its owner must be classified as class 2a under section 273.13,
53.13subdivision 23
, paragraph (a), if:
53.14    (1) the parcel on which the house is located is contiguous on at least two sides to (i)
53.15agricultural land, (ii) land owned or administered by the United States Fish and Wildlife
53.16Service, or (iii) land administered by the Department of Natural Resources on which in lieu
53.17taxes are paid under sections 477A.11 to 477A.14;
53.18    (2) its owner also owns a noncontiguous parcel of agricultural land that is at least 20
53.19acres;
53.20    (3) the noncontiguous land is located not farther than four townships or cities, or a
53.21combination of townships or cities from the homestead; and
53.22    (4) the agricultural use value of the noncontiguous land and farm buildings is equal to
53.23at least 50 percent of the market value of the house, garage, and one acre of land.
53.24    Homesteads initially classified as class 2a under the provisions of this paragraph shall
53.25remain classified as class 2a, irrespective of subsequent changes in the use of adjoining
53.26properties, as long as the homestead remains under the same ownership, the owner owns a
53.27noncontiguous parcel of agricultural land that is at least 20 acres, and the agricultural use
53.28value qualifies under clause (4). Homestead classification under this paragraph is limited
53.29to property that qualified under this paragraph for the 1998 assessment.
53.30    (b)(i) Agricultural property shall be classified as the owner's homestead, to the same
53.31extent as other agricultural homestead property, if all of the following criteria are met:
54.1    (1) the agricultural property consists of at least 40 acres including undivided government
54.2lots and correctional 40's;
54.3    (2) the owner, the owner's spouse, or a grandchild, child, sibling, or parent of the owner
54.4or of the owner's spouse, is actively farming the agricultural property, either on the person's
54.5own behalf as an individual or on behalf of a partnership operating a family farm, family
54.6farm corporation, joint family farm venture, or limited liability company of which the person
54.7is a partner, shareholder, or member;
54.8    (3) both the owner of the agricultural property and the person who is actively farming
54.9the agricultural property under clause (2), are Minnesota residents;
54.10    (4) neither the owner nor the spouse of the owner claims another agricultural homestead
54.11in Minnesota; and
54.12    (5) neither the owner nor the person actively farming the agricultural property lives
54.13farther than four townships or cities, or a combination of four townships or cities, from the
54.14agricultural property, except that if the owner or the owner's spouse is required to live in
54.15employer-provided housing, the owner or owner's spouse, whichever is actively farming
54.16the agricultural property, may live more than four townships or cities, or combination of
54.17four townships or cities from the agricultural property.
54.18    The relationship under this paragraph may be either by blood or marriage.
54.19    (ii) Agricultural property held by a trustee under a trust is eligible for agricultural
54.20homestead classification under this paragraph if the qualifications in clause (i) are met,
54.21except that "owner" means the grantor of the trust.
54.22    (iii) Property containing the residence of an owner who owns qualified property under
54.23clause (i) shall be classified as part of the owner's agricultural homestead, if that property
54.24is also used for noncommercial storage or drying of agricultural crops.
54.25(iv) (iii) As used in this paragraph, "agricultural property" means class 2a property and
54.26any class 2b property that is contiguous to and under the same ownership as the class 2a
54.27property.
54.28    (c) Noncontiguous land shall be included as part of a homestead under section 273.13,
54.29subdivision 23
, paragraph (a), only if the homestead is classified as class 2a and the detached
54.30land is located in the same township or city, or not farther than four townships or cities or
54.31combination thereof from the homestead. Any taxpayer of these noncontiguous lands must
54.32notify the county assessor that the noncontiguous land is part of the taxpayer's homestead,
55.1and, if the homestead is located in another county, the taxpayer must also notify the assessor
55.2of the other county.
55.3    (d) Agricultural land used for purposes of a homestead and actively farmed by a person
55.4holding a vested remainder interest in it must be classified as a homestead under section
55.5273.13, subdivision 23 , paragraph (a). If agricultural land is classified class 2a, any other
55.6dwellings on the land used for purposes of a homestead by persons holding vested remainder
55.7interests who are actively engaged in farming the property, and up to one acre of the land
55.8surrounding each homestead and reasonably necessary for the use of the dwelling as a home,
55.9must also be assessed class 2a.
55.10    (e) Agricultural land and buildings that were class 2a homestead property under section
55.11273.13, subdivision 23 , paragraph (a), for the 1997 assessment shall remain classified as
55.12agricultural homesteads for subsequent assessments if:
55.13    (1) the property owner abandoned the homestead dwelling located on the agricultural
55.14homestead as a result of the April 1997 floods;
55.15    (2) the property is located in the county of Polk, Clay, Kittson, Marshall, Norman, or
55.16Wilkin;
55.17    (3) the agricultural land and buildings remain under the same ownership for the current
55.18assessment year as existed for the 1997 assessment year and continue to be used for
55.19agricultural purposes;
55.20    (4) the dwelling occupied by the owner is located in Minnesota and is within 30 miles
55.21of one of the parcels of agricultural land that is owned by the taxpayer; and
55.22    (5) the owner notifies the county assessor that the relocation was due to the 1997 floods,
55.23and the owner furnishes the assessor any information deemed necessary by the assessor in
55.24verifying the change in dwelling. Further notifications to the assessor are not required if the
55.25property continues to meet all the requirements in this paragraph and any dwellings on the
55.26agricultural land remain uninhabited.
55.27    (f) Agricultural land and buildings that were class 2a homestead property under section
55.28273.13, subdivision 23 , paragraph (a), for the 1998 assessment shall remain classified
55.29agricultural homesteads for subsequent assessments if:
55.30    (1) the property owner abandoned the homestead dwelling located on the agricultural
55.31homestead as a result of damage caused by a March 29, 1998, tornado;
55.32    (2) the property is located in the county of Blue Earth, Brown, Cottonwood, LeSueur,
55.33Nicollet, Nobles, or Rice;
56.1    (3) the agricultural land and buildings remain under the same ownership for the current
56.2assessment year as existed for the 1998 assessment year;
56.3    (4) the dwelling occupied by the owner is located in this state and is within 50 miles of
56.4one of the parcels of agricultural land that is owned by the taxpayer; and
56.5    (5) the owner notifies the county assessor that the relocation was due to a March 29,
56.61998, tornado, and the owner furnishes the assessor any information deemed necessary by
56.7the assessor in verifying the change in homestead dwelling. For taxes payable in 1999, the
56.8owner must notify the assessor by December 1, 1998. Further notifications to the assessor
56.9are not required if the property continues to meet all the requirements in this paragraph and
56.10any dwellings on the agricultural land remain uninhabited.
56.11    (g) Agricultural property of a family farm corporation, joint family farm venture, family
56.12farm limited liability company, or partnership operating a family farm as described under
56.13subdivision 8 shall be classified homestead, to the same extent as other agricultural homestead
56.14property, if all of the following criteria are met:
56.15    (1) the property consists of at least 40 acres including undivided government lots and
56.16correctional 40's;
56.17    (2) a shareholder, member, or partner of that entity is actively farming the agricultural
56.18property;
56.19    (3) that shareholder, member, or partner who is actively farming the agricultural property
56.20is a Minnesota resident;
56.21    (4) neither that shareholder, member, or partner, nor the spouse of that shareholder,
56.22member, or partner claims another agricultural homestead in Minnesota; and
56.23    (5) that shareholder, member, or partner does not live farther than four townships or
56.24cities, or a combination of four townships or cities, from the agricultural property.
56.25    Homestead treatment applies under this paragraph for property leased to a family farm
56.26corporation, joint farm venture, limited liability company, or partnership operating a family
56.27farm if legal title to the property is in the name of an individual who is a member, shareholder,
56.28or partner in the entity.
56.29    (h) To be eligible for the special agricultural homestead under this subdivision, an initial
56.30full application must be submitted to the county assessor where the property is located.
56.31Owners and the persons who are actively farming the property shall be required to complete
56.32only a one-page abbreviated version of the application in each subsequent year provided
56.33that none of the following items have changed since the initial application:
57.1    (1) the day-to-day operation, administration, and financial risks remain the same;
57.2    (2) the owners and the persons actively farming the property continue to live within the
57.3four townships or city criteria and are Minnesota residents;
57.4    (3) the same operator of the agricultural property is listed with the Farm Service Agency;
57.5    (4) a Schedule F or equivalent income tax form was filed for the most recent year;
57.6    (5) the property's acreage is unchanged; and
57.7    (6) none of the property's acres have been enrolled in a federal or state farm program
57.8since the initial application.
57.9    The owners and any persons who are actively farming the property must include the
57.10appropriate Social Security numbers, and sign and date the application. If any of the specified
57.11information has changed since the full application was filed, the owner must notify the
57.12assessor, and must complete a new application to determine if the property continues to
57.13qualify for the special agricultural homestead. The commissioner of revenue shall prepare
57.14a standard reapplication form for use by the assessors.
57.15    (i) Agricultural land and buildings that were class 2a homestead property under section
57.16273.13, subdivision 23 , paragraph (a), for the 2007 assessment shall remain classified
57.17agricultural homesteads for subsequent assessments if:
57.18    (1) the property owner abandoned the homestead dwelling located on the agricultural
57.19homestead as a result of damage caused by the August 2007 floods;
57.20    (2) the property is located in the county of Dodge, Fillmore, Houston, Olmsted, Steele,
57.21Wabasha, or Winona;
57.22    (3) the agricultural land and buildings remain under the same ownership for the current
57.23assessment year as existed for the 2007 assessment year;
57.24    (4) the dwelling occupied by the owner is located in this state and is within 50 miles of
57.25one of the parcels of agricultural land that is owned by the taxpayer; and
57.26    (5) the owner notifies the county assessor that the relocation was due to the August 2007
57.27floods, and the owner furnishes the assessor any information deemed necessary by the
57.28assessor in verifying the change in homestead dwelling. For taxes payable in 2009, the
57.29owner must notify the assessor by December 1, 2008. Further notifications to the assessor
57.30are not required if the property continues to meet all the requirements in this paragraph and
57.31any dwellings on the agricultural land remain uninhabited.
58.1    (j) Agricultural land and buildings that were class 2a homestead property under section
58.2273.13, subdivision 23 , paragraph (a), for the 2008 assessment shall remain classified as
58.3agricultural homesteads for subsequent assessments if:
58.4    (1) the property owner abandoned the homestead dwelling located on the agricultural
58.5homestead as a result of the March 2009 floods;
58.6    (2) the property is located in the county of Marshall;
58.7    (3) the agricultural land and buildings remain under the same ownership for the current
58.8assessment year as existed for the 2008 assessment year and continue to be used for
58.9agricultural purposes;
58.10    (4) the dwelling occupied by the owner is located in Minnesota and is within 50 miles
58.11of one of the parcels of agricultural land that is owned by the taxpayer; and
58.12    (5) the owner notifies the county assessor that the relocation was due to the 2009 floods,
58.13and the owner furnishes the assessor any information deemed necessary by the assessor in
58.14verifying the change in dwelling. Further notifications to the assessor are not required if the
58.15property continues to meet all the requirements in this paragraph and any dwellings on the
58.16agricultural land remain uninhabited.
58.17EFFECTIVE DATE.This section is effective beginning for property taxes payable in
58.182018.

58.19    Sec. 11. Minnesota Statutes 2016, section 273.124, subdivision 21, is amended to read:
58.20    Subd. 21. Trust property; homestead. Real or personal property, including agricultural
58.21property, held by a trustee under a trust is eligible for classification as homestead property
58.22if the property satisfies the requirements of paragraph (a), (b), (c), or (d), or (e).
58.23    (a) The grantor or surviving spouse of the grantor of the trust occupies and uses the
58.24property as a homestead.
58.25    (b) A relative or surviving relative of the grantor who meets the requirements of
58.26subdivision 1, paragraph (c), in the case of residential real estate; or subdivision 1, paragraph
58.27(d), in the case of agricultural property, occupies and uses the property as a homestead.
58.28    (c) A family farm corporation, joint farm venture, limited liability company, or partnership
58.29operating a family farm in which the grantor or the grantor's surviving spouse is a
58.30shareholder, member, or partner rents the property; and, either (1) a shareholder, member,
58.31or partner of the corporation, joint farm venture, limited liability company, or partnership
58.32occupies and uses the property as a homestead; or (2) the property is at least 40 acres,
59.1including undivided government lots and correctional 40's, and a shareholder, member, or
59.2partner of the tenant-entity is actively farming the property on behalf of the corporation,
59.3joint farm venture, limited liability company, or partnership.
59.4    (d) A person who has received homestead classification for property taxes payable in
59.52000 on the basis of an unqualified legal right under the terms of the trust agreement to
59.6occupy the property as that person's homestead and who continues to use the property as a
59.7homestead; or, a person who received the homestead classification for taxes payable in 2005
59.8under paragraph (c) who does not qualify under paragraph (c) for taxes payable in 2006 or
59.9thereafter but who continues to qualify under paragraph (c) as it existed for taxes payable
59.10in 2005.
59.11(e) The qualifications under subdivision 14, paragraph (b), clause (i), are met. For
59.12purposes of this paragraph, "owner" means the grantor of the trust or the surviving spouse
59.13of the grantor.
59.14(f) For purposes of this subdivision, the following terms have the meanings given them:
59.15(1) "agricultural property" means the house, garage, other farm buildings and structures,
59.16and agricultural land;
59.17(2) "agricultural land" has the meaning given in section 273.13, subdivision 23, except
59.18that the phrases "owned by same person" or "under the same ownership" as used in that
59.19subdivision mean and include contiguous tax parcels owned by:
59.20(i) an individual and a trust of which the individual, the individual's spouse, or the
59.21individual's deceased spouse is the grantor; or
59.22(ii) different trusts of which the grantors of each trust are any combination of an
59.23individual, the individual's spouse, or the individual's deceased spouse; and
59.24    For purposes of this subdivision, (3) "grantor" is defined as means the person creating
59.25or establishing a testamentary, inter Vivos, revocable or irrevocable trust by written
59.26instrument or through the exercise of a power of appointment.
59.27(g) Noncontiguous land is included as part of a homestead under this subdivision, only
59.28if the homestead is classified as class 2a, as defined in section 273.13, subdivision 23, and
59.29the detached land is located in the same township or city, or not farther than four townships
59.30or cities or combination thereof from the homestead. Any taxpayer of these noncontiguous
59.31lands must notify the county assessor that the noncontiguous land is part of the taxpayer's
59.32homestead, and, if the homestead is located in another county, the taxpayer must also notify
59.33the assessor of the other county.
60.1EFFECTIVE DATE.This section is effective beginning for property taxes payable in
60.22018.

60.3    Sec. 12. Minnesota Statutes 2016, section 273.125, subdivision 8, is amended to read:
60.4    Subd. 8. Manufactured homes; sectional structures. (a) In this section, "manufactured
60.5home" means a structure transportable in one or more sections, which is built on a permanent
60.6chassis, and designed to be used as a dwelling with or without a permanent foundation when
60.7connected to the required utilities, and contains the plumbing, heating, air conditioning, and
60.8electrical systems in it. Manufactured home includes any accessory structure that is an
60.9addition or supplement to the manufactured home and, when installed, becomes a part of
60.10the manufactured home.
60.11    (b) Except as provided in paragraph (c), a manufactured home that meets each of the
60.12following criteria must be valued and assessed as an improvement to real property, the
60.13appropriate real property classification applies, and the valuation is subject to review and
60.14the taxes payable in the manner provided for real property:
60.15    (1) the owner of the unit holds title to the land on which it is situated;
60.16    (2) the unit is affixed to the land by a permanent foundation or is installed at its location
60.17in accordance with the Manufactured Home Building Code in sections 327.31 to 327.34,
60.18and rules adopted under those sections, or is affixed to the land like other real property in
60.19the taxing district; and
60.20    (3) the unit is connected to public utilities, has a well and septic tank system, or is serviced
60.21by water and sewer facilities comparable to other real property in the taxing district.
60.22    (c) A manufactured home that meets each of the following criteria must be assessed at
60.23the rate provided by the appropriate real property classification but must be treated as
60.24personal property, and the valuation is subject to review and the taxes payable in the manner
60.25provided in this section:
60.26    (1) the owner of the unit is a lessee of the land under the terms of a lease, or the unit is
60.27located in a manufactured home park but is not the homestead of the park owner;
60.28    (2) the unit is affixed to the land by a permanent foundation or is installed at its location
60.29in accordance with the Manufactured Home Building Code contained in sections 327.31 to
60.30327.34 , and the rules adopted under those sections, or is affixed to the land like other real
60.31property in the taxing district; and
61.1    (3) the unit is connected to public utilities, has a well and septic tank system, or is serviced
61.2by water and sewer facilities comparable to other real property in the taxing district.
61.3    (d) Sectional structures must be valued and assessed as an improvement to real property
61.4if the owner of the structure holds title to the land on which it is located or is a qualifying
61.5lessee of the land under section 273.19. In this paragraph "sectional structure" means a
61.6building or structural unit that has been in whole or substantial part manufactured or
61.7constructed at an off-site location to be wholly or partially assembled on site alone or with
61.8other units and attached to a permanent foundation.
61.9    (e) The commissioner of revenue may adopt rules under the Administrative Procedure
61.10Act to establish additional criteria for the classification of manufactured homes and sectional
61.11structures under this subdivision.
61.12    (f) A storage shed, deck, or similar improvement constructed on property that is leased
61.13or rented as a site for a manufactured home, sectional structure, park trailer, or travel trailer
61.14is taxable as provided in this section. In the case of property that is leased or rented as a site
61.15for a travel trailer, a storage shed, deck, or similar improvement on the site that is considered
61.16personal property under this paragraph is taxable only if its total estimated market value is
61.17over $1,000 $10,000. The property is taxable as personal property to the lessee of the site
61.18if it is not owned by the owner of the site. The property is taxable as real estate if it is owned
61.19by the owner of the site. As a condition of permitting the owner of the manufactured home,
61.20sectional structure, park trailer, or travel trailer to construct improvements on the leased or
61.21rented site, the owner of the site must obtain the permanent home address of the lessee or
61.22user of the site. The site owner must provide the name and address to the assessor upon
61.23request.

61.24    Sec. 13. Minnesota Statutes 2016, section 273.13, subdivision 22, is amended to read:
61.25    Subd. 22. Class 1. (a) Except as provided in subdivision 23 and in paragraphs (b) and
61.26(c), real estate which is residential and used for homestead purposes is class 1a. In the case
61.27of a duplex or triplex in which one of the units is used for homestead purposes, the entire
61.28property is deemed to be used for homestead purposes. The market value of class 1a property
61.29must be determined based upon the value of the house, garage, and land.
61.30    The first $500,000 of market value of class 1a property has a net classification rate of
61.31one percent of its market value; and the market value of class 1a property that exceeds
61.32$500,000 has a classification rate of 1.25 percent of its market value.
62.1    (b) Class 1b property includes homestead real estate or homestead manufactured homes
62.2used for the purposes of a homestead by:
62.3    (1) any person who is blind as defined in section 256D.35, or the blind person and the
62.4blind person's spouse;
62.5    (2) any person who is permanently and totally disabled or by the disabled person and
62.6the disabled person's spouse; or
62.7    (3) the surviving spouse of a permanently and totally disabled veteran homesteading a
62.8property classified under this paragraph for taxes payable in 2008.
62.9    Property is classified and assessed under clause (2) only if the government agency or
62.10income-providing source certifies, upon the request of the homestead occupant, that the
62.11homestead occupant satisfies the disability requirements of this paragraph, and that the
62.12property is not eligible for the valuation exclusion under subdivision 34.
62.13    Property is classified and assessed under paragraph (b) only if the commissioner of
62.14revenue or the county assessor certifies that the homestead occupant satisfies the requirements
62.15of this paragraph.
62.16    Permanently and totally disabled for the purpose of this subdivision means a condition
62.17which is permanent in nature and totally incapacitates the person from working at an
62.18occupation which brings the person an income. The first $50,000 market value of class 1b
62.19property has a net classification rate of .45 percent of its market value. The remaining market
62.20value of class 1b property has a classification rate using the rates for class 1a or class 2a
62.21property, whichever is appropriate, of similar market value.
62.22    (c) Class 1c property is commercial use real and personal property that abuts public
62.23water as defined in section 103G.005, subdivision 15, or abuts a state trail administered by
62.24the Department of Natural Resources, and is devoted to temporary and seasonal residential
62.25occupancy for recreational purposes but not devoted to commercial purposes for more than
62.26250 days in the year preceding the year of assessment, and that includes a portion used as
62.27a homestead by the owner, which includes a dwelling occupied as a homestead by a
62.28shareholder of a corporation that owns the resort, a partner in a partnership that owns the
62.29resort, or a member of a limited liability company that owns the resort even if, whether the
62.30title to the homestead is held by the corporation, partnership, or limited liability company,
62.31or by a shareholder of a corporation who owns the resort, a partner in a partnership who
62.32owns the resort, or a member of a limited liability company who owns the resort. For
62.33purposes of this paragraph, property is devoted to a commercial purpose on a specific day
62.34if any portion of the property, excluding the portion used exclusively as a homestead, is
63.1used for residential occupancy and a fee is charged for residential occupancy. Class 1c
63.2property must contain three or more rental units. A "rental unit" is defined as a cabin,
63.3condominium, townhouse, sleeping room, or individual camping site equipped with water
63.4and electrical hookups for recreational vehicles. Class 1c property must provide recreational
63.5activities such as the rental of ice fishing houses, boats and motors, snowmobiles, downhill
63.6or cross-country ski equipment; provide marina services, launch services, or guide services;
63.7or sell bait and fishing tackle. Any unit in which the right to use the property is transferred
63.8to an individual or entity by deeded interest, or the sale of shares or stock, no longer qualifies
63.9for class 1c even though it may remain available for rent. A camping pad offered for rent
63.10by a property that otherwise qualifies for class 1c is also class 1c, regardless of the term of
63.11the rental agreement, as long as the use of the camping pad does not exceed 250 days. If
63.12the same owner owns two separate parcels that are located in the same township, and one
63.13of those properties is classified as a class 1c property and the other would be eligible to be
63.14classified as a class 1c property if it was used as the homestead of the owner, both properties
63.15will be assessed as a single class 1c property; for purposes of this sentence, properties are
63.16deemed to be owned by the same owner if each of them is owned by a limited liability
63.17company, and both limited liability companies have the same membership. The portion of
63.18the property used as a homestead is class 1a property under paragraph (a). The remainder
63.19of the property is classified as follows: the first $600,000 of market value is tier I, the next
63.20$1,700,000 of market value is tier II, and any remaining market value is tier III. The
63.21classification rates for class 1c are: tier I, 0.50 percent; tier II, 1.0 percent; and tier III, 1.25
63.22percent. Owners of real and personal property devoted to temporary and seasonal residential
63.23occupancy for recreation purposes in which all or a portion of the property was devoted to
63.24commercial purposes for not more than 250 days in the year preceding the year of assessment
63.25desiring classification as class 1c, must submit a declaration to the assessor designating the
63.26cabins or units occupied for 250 days or less in the year preceding the year of assessment
63.27by January 15 of the assessment year. Those cabins or units and a proportionate share of
63.28the land on which they are located must be designated as class 1c as otherwise provided.
63.29The remainder of the cabins or units and a proportionate share of the land on which they
63.30are located must be designated as class 3a commercial. The owner of property desiring
63.31designation as class 1c property must provide guest registers or other records demonstrating
63.32that the units for which class 1c designation is sought were not occupied for more than 250
63.33days in the year preceding the assessment if so requested. The portion of a property operated
63.34as a (1) restaurant, (2) bar, (3) gift shop, (4) conference center or meeting room, and (5)
63.35other nonresidential facility operated on a commercial basis not directly related to temporary
63.36and seasonal residential occupancy for recreation purposes does not qualify for class 1c.
64.1    (d) Class 1d property includes structures that meet all of the following criteria:
64.2    (1) the structure is located on property that is classified as agricultural property under
64.3section 273.13, subdivision 23;
64.4    (2) the structure is occupied exclusively by seasonal farm workers during the time when
64.5they work on that farm, and the occupants are not charged rent for the privilege of occupying
64.6the property, provided that use of the structure for storage of farm equipment and produce
64.7does not disqualify the property from classification under this paragraph;
64.8    (3) the structure meets all applicable health and safety requirements for the appropriate
64.9season; and
64.10    (4) the structure is not salable as residential property because it does not comply with
64.11local ordinances relating to location in relation to streets or roads.
64.12    The market value of class 1d property has the same classification rates as class 1a property
64.13under paragraph (a).
64.14EFFECTIVE DATE.This section is effective beginning with taxes payable in 2018.

64.15    Sec. 14. Minnesota Statutes 2016, section 273.13, subdivision 23, is amended to read:
64.16    Subd. 23. Class 2. (a) An agricultural homestead consists of class 2a agricultural land
64.17that is homesteaded, along with any class 2b rural vacant land that is contiguous to the class
64.182a land under the same ownership. The market value of the house and garage and immediately
64.19surrounding one acre of land has the same classification rates as class 1a or 1b property
64.20under subdivision 22. The value of the remaining land including improvements up to the
64.21first tier valuation limit of agricultural homestead property has a classification rate of 0.5
64.22percent of market value. The remaining property over the first tier has a classification rate
64.23of one percent of market value. For purposes of this subdivision, the "first tier valuation
64.24limit of agricultural homestead property" and "first tier" means the limit certified under
64.25section 273.11, subdivision 23.
64.26    (b) Class 2a agricultural land consists of parcels of property, or portions thereof, that
64.27are agricultural land and buildings. Class 2a property has a classification rate of one percent
64.28of market value, unless it is part of an agricultural homestead under paragraph (a). Class 2a
64.29property must also include any property that would otherwise be classified as 2b, but is
64.30interspersed with class 2a property, including but not limited to sloughs, wooded wind
64.31shelters, acreage abutting ditches, ravines, rock piles, land subject to a setback requirement,
64.32and other similar land that is impractical for the assessor to value separately from the rest
64.33of the property or that is unlikely to be able to be sold separately from the rest of the property.
65.1    An assessor may classify the part of a parcel described in this subdivision that is used
65.2for agricultural purposes as class 2a and the remainder in the class appropriate to its use.
65.3    (c) Class 2b rural vacant land consists of parcels of property, or portions thereof, that
65.4are unplatted real estate, rural in character and not used for agricultural purposes, including
65.5land used for growing trees for timber, lumber, and wood and wood products, that is not
65.6improved with a structure. The presence of a minor, ancillary nonresidential structure as
65.7defined by the commissioner of revenue does not disqualify the property from classification
65.8under this paragraph. Any parcel of 20 acres or more improved with a structure that is not
65.9a minor, ancillary nonresidential structure must be split-classified, and ten acres must be
65.10assigned to the split parcel containing the structure. Class 2b property has a classification
65.11rate of one percent of market value unless it is part of an agricultural homestead under
65.12paragraph (a), or qualifies as class 2c under paragraph (d).
65.13    (d) Class 2c managed forest land consists of no less than 20 and no more than 1,920
65.14acres statewide per taxpayer that is being managed under a forest management plan that
65.15meets the requirements of chapter 290C, but is not enrolled in the sustainable forest resource
65.16management incentive program. It has a classification rate of .65 percent, provided that the
65.17owner of the property must apply to the assessor in order for the property to initially qualify
65.18for the reduced rate and provide the information required by the assessor to verify that the
65.19property qualifies for the reduced rate. If the assessor receives the application and information
65.20before May 1 in an assessment year, the property qualifies beginning with that assessment
65.21year. If the assessor receives the application and information after April 30 in an assessment
65.22year, the property may not qualify until the next assessment year. The commissioner of
65.23natural resources must concur that the land is qualified. The commissioner of natural
65.24resources shall annually provide county assessors verification information on a timely basis.
65.25The presence of a minor, ancillary nonresidential structure as defined by the commissioner
65.26of revenue does not disqualify the property from classification under this paragraph.
65.27    (e) Agricultural land as used in this section means:
65.28    (1) contiguous acreage of ten acres or more, used during the preceding year for
65.29agricultural purposes; or
65.30    (2) contiguous acreage used during the preceding year for an intensive livestock or
65.31poultry confinement operation, provided that land used only for pasturing or grazing does
65.32not qualify under this clause.
65.33    "Agricultural purposes" as used in this section means the raising, cultivation, drying, or
65.34storage of agricultural products for sale, or the storage of machinery or equipment used in
66.1support of agricultural production by the same farm entity. For a property to be classified
66.2as agricultural based only on the drying or storage of agricultural products, the products
66.3being dried or stored must have been produced by the same farm entity as the entity operating
66.4the drying or storage facility. "Agricultural purposes" also includes enrollment in the Reinvest
66.5in Minnesota program under sections 103F.501 to 103F.535 or the federal Conservation
66.6Reserve Program as contained in Public Law 99-198 or a similar local, state, or federal
66.7conservation program if the property was classified as agricultural (i) under this subdivision
66.8for taxes payable in 2003 because of its enrollment in a qualifying program and the land
66.9remains enrolled or (ii) in the year prior to its enrollment. For purposes of this section, a
66.10local conservation program means a program administered by a town, statutory or home
66.11rule charter city, or county, including a watershed district, water management organization,
66.12or soil and water conservation district, in which landowners voluntarily enroll land and
66.13receive incentive payments in exchange for use or other restrictions placed on the land.
66.14Agricultural classification shall not be based upon the market value of any residential
66.15structures on the parcel or contiguous parcels under the same ownership.
66.16    "Contiguous acreage," for purposes of this paragraph, means all of, or a contiguous
66.17portion of, a tax parcel as described in section 272.193, or all of, or a contiguous portion
66.18of, a set of contiguous tax parcels under that section that are owned by the same person.
66.19    (f) Agricultural land under this section also includes:
66.20    (1) contiguous acreage that is less than ten acres in size and exclusively used in the
66.21preceding year for raising or cultivating agricultural products; or
66.22    (2) contiguous acreage that contains a residence and is less than 11 acres in size, if the
66.23contiguous acreage exclusive of the house, garage, and surrounding one acre of land was
66.24used in the preceding year for one or more of the following three uses:
66.25    (i) for an intensive grain drying or storage operation, or for intensive machinery or
66.26equipment storage activities used to support agricultural activities on other parcels of property
66.27operated by the same farming entity;
66.28    (ii) as a nursery, provided that only those acres used intensively to produce nursery stock
66.29are considered agricultural land; or
66.30    (iii) for intensive market farming; for purposes of this paragraph, "market farming"
66.31means the cultivation of one or more fruits or vegetables or production of animal or other
66.32agricultural products for sale to local markets by the farmer or an organization with which
66.33the farmer is affiliated.
67.1    "Contiguous acreage," for purposes of this paragraph, means all of a tax parcel as
67.2described in section 272.193, or all of a set of contiguous tax parcels under that section that
67.3are owned by the same person.
67.4    (g) Land shall be classified as agricultural even if all or a portion of the agricultural use
67.5of that property is the leasing to, or use by another person for agricultural purposes.
67.6    Classification under this subdivision is not determinative for qualifying under section
67.7273.111 .
67.8    (h) The property classification under this section supersedes, for property tax purposes
67.9only, any locally administered agricultural policies or land use restrictions that define
67.10minimum or maximum farm acreage.
67.11    (i) The term "agricultural products" as used in this subdivision includes production for
67.12sale of:
67.13    (1) livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing
67.14animals, horticultural and nursery stock, fruit of all kinds, vegetables, forage, grains, bees,
67.15and apiary products by the owner;
67.16    (2) fish bred for sale and consumption if the fish breeding occurs on land zoned for
67.17agricultural use;
67.18    (3) the commercial boarding of horses, which may include related horse training and
67.19riding instruction, if the boarding is done on property that is also used for raising pasture
67.20to graze horses or raising or cultivating other agricultural products as defined in clause (1);
67.21    (4) property which is owned and operated by nonprofit organizations used for equestrian
67.22activities, excluding racing;
67.23    (5) game birds and waterfowl bred and raised (i) on a game farm licensed under section
67.2497A.105 , provided that the annual licensing report to the Department of Natural Resources,
67.25which must be submitted annually by March 30 to the assessor, indicates that at least 500
67.26birds were raised or used for breeding stock on the property during the preceding year and
67.27that the owner provides a copy of the owner's most recent schedule F; or (ii) for use on a
67.28shooting preserve licensed under section 97A.115;
67.29    (6) insects primarily bred to be used as food for animals;
67.30    (7) trees, grown for sale as a crop, including short rotation woody crops, and not sold
67.31for timber, lumber, wood, or wood products; and
68.1    (8) maple syrup taken from trees grown by a person licensed by the Minnesota
68.2Department of Agriculture under chapter 28A as a food processor.
68.3    (j) If a parcel used for agricultural purposes is also used for commercial or industrial
68.4purposes, including but not limited to:
68.5    (1) wholesale and retail sales;
68.6    (2) processing of raw agricultural products or other goods;
68.7    (3) warehousing or storage of processed goods; and
68.8    (4) office facilities for the support of the activities enumerated in clauses (1), (2), and
68.9(3),
68.10the assessor shall classify the part of the parcel used for agricultural purposes as class 1b,
68.112a, or 2b, whichever is appropriate, and the remainder in the class appropriate to its use.
68.12The grading, sorting, and packaging of raw agricultural products for first sale is considered
68.13an agricultural purpose. A greenhouse or other building where horticultural or nursery
68.14products are grown that is also used for the conduct of retail sales must be classified as
68.15agricultural if it is primarily used for the growing of horticultural or nursery products from
68.16seed, cuttings, or roots and occasionally as a showroom for the retail sale of those products.
68.17Use of a greenhouse or building only for the display of already grown horticultural or nursery
68.18products does not qualify as an agricultural purpose.
68.19    (k) The assessor shall determine and list separately on the records the market value of
68.20the homestead dwelling and the one acre of land on which that dwelling is located. If any
68.21farm buildings or structures are located on this homesteaded acre of land, their market value
68.22shall not be included in this separate determination.
68.23    (l) Class 2d airport landing area consists of a landing area or public access area of a
68.24privately owned public use airport. It has a classification rate of one percent of market value.
68.25To qualify for classification under this paragraph, a privately owned public use airport must
68.26be licensed as a public airport under section 360.018. For purposes of this paragraph, "landing
68.27area" means that part of a privately owned public use airport properly cleared, regularly
68.28maintained, and made available to the public for use by aircraft and includes runways,
68.29taxiways, aprons, and sites upon which are situated landing or navigational aids. A landing
68.30area also includes land underlying both the primary surface and the approach surfaces that
68.31comply with all of the following:
69.1    (i) the land is properly cleared and regularly maintained for the primary purposes of the
69.2landing, taking off, and taxiing of aircraft; but that portion of the land that contains facilities
69.3for servicing, repair, or maintenance of aircraft is not included as a landing area;
69.4    (ii) the land is part of the airport property; and
69.5    (iii) the land is not used for commercial or residential purposes.
69.6The land contained in a landing area under this paragraph must be described and certified
69.7by the commissioner of transportation. The certification is effective until it is modified, or
69.8until the airport or landing area no longer meets the requirements of this paragraph. For
69.9purposes of this paragraph, "public access area" means property used as an aircraft parking
69.10ramp, apron, or storage hangar, or an arrival and departure building in connection with the
69.11airport.
69.12    (m) Class 2e consists of land with a commercial aggregate deposit that is not actively
69.13being mined and is not otherwise classified as class 2a or 2b, provided that the land is not
69.14located in a county that has elected to opt-out of the aggregate preservation program as
69.15provided in section 273.1115, subdivision 6. It has a classification rate of one percent of
69.16market value. To qualify for classification under this paragraph, the property must be at
69.17least ten contiguous acres in size and the owner of the property must record with the county
69.18recorder of the county in which the property is located an affidavit containing:
69.19    (1) a legal description of the property;
69.20    (2) a disclosure that the property contains a commercial aggregate deposit that is not
69.21actively being mined but is present on the entire parcel enrolled;
69.22    (3) documentation that the conditional use under the county or local zoning ordinance
69.23of this property is for mining; and
69.24    (4) documentation that a permit has been issued by the local unit of government or the
69.25mining activity is allowed under local ordinance. The disclosure must include a statement
69.26from a registered professional geologist, engineer, or soil scientist delineating the deposit
69.27and certifying that it is a commercial aggregate deposit.
69.28    For purposes of this section and section 273.1115, "commercial aggregate deposit"
69.29means a deposit that will yield crushed stone or sand and gravel that is suitable for use as
69.30a construction aggregate; and "actively mined" means the removal of top soil and overburden
69.31in preparation for excavation or excavation of a commercial deposit.
69.32    (n) When any portion of the property under this subdivision or subdivision 22 begins to
69.33be actively mined, the owner must file a supplemental affidavit within 60 days from the
70.1day any aggregate is removed stating the number of acres of the property that is actively
70.2being mined. The acres actively being mined must be (1) valued and classified under
70.3subdivision 24 in the next subsequent assessment year, and (2) removed from the aggregate
70.4resource preservation property tax program under section 273.1115, if the land was enrolled
70.5in that program. Copies of the original affidavit and all supplemental affidavits must be
70.6filed with the county assessor, the local zoning administrator, and the Department of Natural
70.7Resources, Division of Land and Minerals. A supplemental affidavit must be filed each
70.8time a subsequent portion of the property is actively mined, provided that the minimum
70.9acreage change is five acres, even if the actual mining activity constitutes less than five
70.10acres.
70.11    (o) The definitions prescribed by the commissioner under paragraphs (c) and (d) are not
70.12rules and are exempt from the rulemaking provisions of chapter 14, and the provisions in
70.13section 14.386 concerning exempt rules do not apply.
70.14EFFECTIVE DATE.This section is effective beginning with assessment year 2018.

70.15    Sec. 15. Minnesota Statutes 2016, section 273.13, subdivision 25, is amended to read:
70.16    Subd. 25. Class 4. (a) Class 4a is residential real estate containing four or more units
70.17and used or held for use by the owner or by the tenants or lessees of the owner as a residence
70.18for rental periods of 30 days or more, excluding property qualifying for class 4d. Class 4a
70.19also includes hospitals licensed under sections 144.50 to 144.56, other than hospitals exempt
70.20under section 272.02, and contiguous property used for hospital purposes, without regard
70.21to whether the property has been platted or subdivided. The market value of class 4a property
70.22has a classification rate of 1.25 percent.
70.23    (b) Class 4b includes:
70.24    (1) residential real estate containing less than four units that does not qualify as class
70.254bb, other than seasonal residential recreational property;
70.26    (2) manufactured homes not classified under any other provision;
70.27    (3) a dwelling, garage, and surrounding one acre of property on a nonhomestead farm
70.28classified under subdivision 23, paragraph (b) containing two or three units; and
70.29    (4) unimproved property that is classified residential as determined under subdivision
70.3033.
70.31    The market value of class 4b property has a classification rate of 1.25 percent.
70.32    (c) Class 4bb includes:
71.1    (1) nonhomestead residential real estate containing one unit, other than seasonal
71.2residential recreational property, and a single family dwelling, garage,;
71.3    (2) single-family dwellings including garages and the surrounding one acre of property
71.4on a nonhomestead farm farms classified under subdivision 23, paragraph (b); and
71.5    (3) condominium-type storage units having individual legal descriptions that are not
71.6used for commercial purposes.
71.7    Class 4bb property has the same classification rates as class 1a property under subdivision
71.822.
71.9    Property that has been classified as seasonal residential recreational property at any time
71.10during which it has been owned by the current owner or spouse of the current owner does
71.11not qualify for class 4bb.
71.12    (d) Class 4c property includes:
71.13    (1) except as provided in subdivision 22, paragraph (c), real and personal property
71.14devoted to commercial temporary and seasonal residential occupancy for recreation purposes,
71.15for not more than 250 days in the year preceding the year of assessment. For purposes of
71.16this clause, property is devoted to a commercial purpose on a specific day if any portion of
71.17the property is used for residential occupancy, and a fee is charged for residential occupancy.
71.18Class 4c property under this clause must contain three or more rental units. A "rental unit"
71.19is defined as a cabin, condominium, townhouse, sleeping room, or individual camping site
71.20equipped with water and electrical hookups for recreational vehicles. A camping pad offered
71.21for rent by a property that otherwise qualifies for class 4c under this clause is also class 4c
71.22under this clause regardless of the term of the rental agreement, as long as the use of the
71.23camping pad does not exceed 250 days. In order for a property to be classified under this
71.24clause, either (i) the business located on the property must provide recreational activities,
71.25at least 40 percent of the annual gross lodging receipts related to the property must be from
71.26business conducted during 90 consecutive days, and either (A) at least 60 percent of all paid
71.27bookings by lodging guests during the year must be for periods of at least two consecutive
71.28nights; or (B) at least 20 percent of the annual gross receipts must be from charges for
71.29providing recreational activities, or (ii) the business must contain 20 or fewer rental units,
71.30and must be located in a township or a city with a population of 2,500 or less located outside
71.31the metropolitan area, as defined under section 473.121, subdivision 2, that contains a portion
71.32of a state trail administered by the Department of Natural Resources. For purposes of item
71.33(i)(A), a paid booking of five or more nights shall be counted as two bookings. Class 4c
71.34property also includes commercial use real property used exclusively for recreational
72.1purposes in conjunction with other class 4c property classified under this clause and devoted
72.2to temporary and seasonal residential occupancy for recreational purposes, up to a total of
72.3two acres, provided the property is not devoted to commercial recreational use for more
72.4than 250 days in the year preceding the year of assessment and is located within two miles
72.5of the class 4c property with which it is used. In order for a property to qualify for
72.6classification under this clause, the owner must submit a declaration to the assessor
72.7designating the cabins or units occupied for 250 days or less in the year preceding the year
72.8of assessment by January 15 of the assessment year. Those cabins or units and a proportionate
72.9share of the land on which they are located must be designated class 4c under this clause
72.10as otherwise provided. The remainder of the cabins or units and a proportionate share of
72.11the land on which they are located will be designated as class 3a. The owner of property
72.12desiring designation as class 4c property under this clause must provide guest registers or
72.13other records demonstrating that the units for which class 4c designation is sought were not
72.14occupied for more than 250 days in the year preceding the assessment if so requested. The
72.15portion of a property operated as a (1) restaurant, (2) bar, (3) gift shop, (4) conference center
72.16or meeting room, and (5) other nonresidential facility operated on a commercial basis not
72.17directly related to temporary and seasonal residential occupancy for recreation purposes
72.18does not qualify for class 4c. For the purposes of this paragraph, "recreational activities"
72.19means renting ice fishing houses, boats and motors, snowmobiles, downhill or cross-country
72.20ski equipment; providing marina services, launch services, or guide services; or selling bait
72.21and fishing tackle;
72.22    (2) qualified property used as a golf course if:
72.23    (i) it is open to the public on a daily fee basis. It may charge membership fees or dues,
72.24but a membership fee may not be required in order to use the property for golfing, and its
72.25green fees for golfing must be comparable to green fees typically charged by municipal
72.26courses; and
72.27    (ii) it meets the requirements of section 273.112, subdivision 3, paragraph (d).
72.28    A structure used as a clubhouse, restaurant, or place of refreshment in conjunction with
72.29the golf course is classified as class 3a property;
72.30    (3) real property up to a maximum of three acres of land owned and used by a nonprofit
72.31community service oriented organization and not used for residential purposes on either a
72.32temporary or permanent basis, provided that:
72.33    (i) the property is not used for a revenue-producing activity for more than six days in
72.34the calendar year preceding the year of assessment; or
73.1    (ii) the organization makes annual charitable contributions and donations at least equal
73.2to the property's previous year's property taxes and the property is allowed to be used for
73.3public and community meetings or events for no charge, as appropriate to the size of the
73.4facility.
73.5    For purposes of this clause:
73.6    (A) "charitable contributions and donations" has the same meaning as lawful gambling
73.7purposes under section 349.12, subdivision 25, excluding those purposes relating to the
73.8payment of taxes, assessments, fees, auditing costs, and utility payments;
73.9    (B) "property taxes" excludes the state general tax;
73.10    (C) a "nonprofit community service oriented organization" means any corporation,
73.11society, association, foundation, or institution organized and operated exclusively for
73.12charitable, religious, fraternal, civic, or educational purposes, and which is exempt from
73.13federal income taxation pursuant to section 501(c)(3), (8), (10), or (19) of the Internal
73.14Revenue Code; and
73.15    (D) "revenue-producing activities" shall include but not be limited to property or that
73.16portion of the property that is used as an on-sale intoxicating liquor or 3.2 percent malt
73.17liquor establishment licensed under chapter 340A, a restaurant open to the public, bowling
73.18alley, a retail store, gambling conducted by organizations licensed under chapter 349, an
73.19insurance business, or office or other space leased or rented to a lessee who conducts a
73.20for-profit enterprise on the premises.
73.21    Any portion of the property not qualifying under either item (i) or (ii) is class 3a. The
73.22use of the property for social events open exclusively to members and their guests for periods
73.23of less than 24 hours, when an admission is not charged nor any revenues are received by
73.24the organization shall not be considered a revenue-producing activity.
73.25    The organization shall maintain records of its charitable contributions and donations
73.26and of public meetings and events held on the property and make them available upon
73.27request any time to the assessor to ensure eligibility. An organization meeting the requirement
73.28under item (ii) must file an application by May 1 with the assessor for eligibility for the
73.29current year's assessment. The commissioner shall prescribe a uniform application form
73.30and instructions;
73.31    (4) postsecondary student housing of not more than one acre of land that is owned by a
73.32nonprofit corporation organized under chapter 317A and is used exclusively by a student
74.1cooperative, sorority, or fraternity for on-campus housing or housing located within two
74.2miles of the border of a college campus;
74.3    (5)(i) manufactured home parks as defined in section 327.14, subdivision 3, excluding
74.4manufactured home parks described in section 273.124, subdivision 3a, and (ii) manufactured
74.5home parks as defined in section 327.14, subdivision 3, that are described in section 273.124,
74.6subdivision 3a
;
74.7    (6) real property that is actively and exclusively devoted to indoor fitness, health, social,
74.8recreational, and related uses, is owned and operated by a not-for-profit corporation, and is
74.9located within the metropolitan area as defined in section 473.121, subdivision 2;
74.10    (7) a leased or privately owned noncommercial aircraft storage hangar not exempt under
74.11section 272.01, subdivision 2, and the land on which it is located, provided that:
74.12    (i) the land is on an airport owned or operated by a city, town, county, Metropolitan
74.13Airports Commission, or group thereof; and
74.14    (ii) the land lease, or any ordinance or signed agreement restricting the use of the leased
74.15premise, prohibits commercial activity performed at the hangar.
74.16    If a hangar classified under this clause is sold after June 30, 2000, a bill of sale must be
74.17filed by the new owner with the assessor of the county where the property is located within
74.1860 days of the sale;
74.19    (8) a privately owned noncommercial aircraft storage hangar not exempt under section
74.20272.01, subdivision 2 , and the land on which it is located, provided that:
74.21    (i) the land abuts a public airport; and
74.22    (ii) the owner of the aircraft storage hangar provides the assessor with a signed agreement
74.23restricting the use of the premises, prohibiting commercial use or activity performed at the
74.24hangar; and
74.25    (9) residential real estate, a portion of which is used by the owner for homestead purposes,
74.26and that is also a place of lodging, if all of the following criteria are met:
74.27    (i) rooms are provided for rent to transient guests that generally stay for periods of 14
74.28or fewer days;
74.29    (ii) meals are provided to persons who rent rooms, the cost of which is incorporated in
74.30the basic room rate;
74.31    (iii) meals are not provided to the general public except for special events on fewer than
74.32seven days in the calendar year preceding the year of the assessment; and
75.1    (iv) the owner is the operator of the property.
75.2    The market value subject to the 4c classification under this clause is limited to five rental
75.3units. Any rental units on the property in excess of five, must be valued and assessed as
75.4class 3a. The portion of the property used for purposes of a homestead by the owner must
75.5be classified as class 1a property under subdivision 22;
75.6    (10) real property up to a maximum of three acres and operated as a restaurant as defined
75.7under section 157.15, subdivision 12, provided it: (i) is located on a lake as defined under
75.8section 103G.005, subdivision 15, paragraph (a), clause (3); and (ii) is either devoted to
75.9commercial purposes for not more than 250 consecutive days, or receives at least 60 percent
75.10of its annual gross receipts from business conducted during four consecutive months. Gross
75.11receipts from the sale of alcoholic beverages must be included in determining the property's
75.12qualification under item (ii). The property's primary business must be as a restaurant and
75.13not as a bar. Gross receipts from gift shop sales located on the premises must be excluded.
75.14Owners of real property desiring 4c classification under this clause must submit an annual
75.15declaration to the assessor by February 1 of the current assessment year, based on the
75.16property's relevant information for the preceding assessment year;
75.17(11) lakeshore and riparian property and adjacent land, not to exceed six acres, used as
75.18a marina, as defined in section 86A.20, subdivision 5, which is made accessible to the public
75.19and devoted to recreational use for marina services. The marina owner must annually provide
75.20evidence to the assessor that it provides services, including lake or river access to the public
75.21by means of an access ramp or other facility that is either located on the property of the
75.22marina or at a publicly owned site that abuts the property of the marina. No more than 800
75.23feet of lakeshore may be included in this classification. Buildings used in conjunction with
75.24a marina for marina services, including but not limited to buildings used to provide food
75.25and beverage services, fuel, boat repairs, or the sale of bait or fishing tackle, are classified
75.26as class 3a property; and
75.27(12) real and personal property devoted to noncommercial temporary and seasonal
75.28residential occupancy for recreation purposes.
75.29    Class 4c property has a classification rate of 1.5 percent of market value, except that (i)
75.30each parcel of noncommercial seasonal residential recreational property under clause (12)
75.31has the same classification rates as class 4bb property, (ii) manufactured home parks assessed
75.32under clause (5), item (i), have the same classification rate as class 4b property, and the
75.33market value of manufactured home parks assessed under clause (5), item (ii), has a
75.34classification rate of 0.75 percent if more than 50 percent of the lots in the park are occupied
76.1by shareholders in the cooperative corporation or association and a classification rate of
76.2one percent if 50 percent or less of the lots are so occupied, (iii) commercial-use seasonal
76.3residential recreational property and marina recreational land as described in clause (11),
76.4has a classification rate of one percent for the first $500,000 of market value, and 1.25
76.5percent for the remaining market value, (iv) the market value of property described in clause
76.6(4) has a classification rate of one percent, (v) the market value of property described in
76.7clauses (2), (6), and (10) has a classification rate of 1.25 percent, and (vi) that portion of
76.8the market value of property in clause (9) qualifying for class 4c property has a classification
76.9rate of 1.25 percent, and (vii) property qualifying for classification under clause (3) that is
76.10owned or operated by a congressionally chartered veterans organization has a classification
76.11rate of one percent. The commissioner of veterans affairs must provide a list of
76.12congressionally chartered veterans organizations to the commissioner of revenue by June
76.1330, 2017, and by January 1, 2018, and each year thereafter.
76.14    (e) Class 4d property is qualifying low-income rental housing certified to the assessor
76.15by the Housing Finance Agency under section 273.128, subdivision 3. If only a portion of
76.16the units in the building qualify as low-income rental housing units as certified under section
76.17273.128, subdivision 3 , only the proportion of qualifying units to the total number of units
76.18in the building qualify for class 4d. The remaining portion of the building shall be classified
76.19by the assessor based upon its use. Class 4d also includes the same proportion of land as
76.20the qualifying low-income rental housing units are to the total units in the building. For all
76.21properties qualifying as class 4d, the market value determined by the assessor must be based
76.22on the normal approach to value using normal unrestricted rents.
76.23    (f) The first tier of market value of class 4d property has a classification rate of 0.75
76.24percent. The remaining value of class 4d property has a classification rate of 0.25 percent.
76.25For the purposes of this paragraph, the "first tier of market value of class 4d property" means
76.26the market value of each housing unit up to the first tier limit. For the purposes of this
76.27paragraph, all class 4d property value must be assigned to individual housing units. The
76.28first tier limit is $100,000 for assessment year 2014. For subsequent years, the limit is
76.29adjusted each year by the average statewide change in estimated market value of property
76.30classified as class 4a and 4d under this section for the previous assessment year, excluding
76.31valuation change due to new construction, rounded to the nearest $1,000, provided, however,
76.32that the limit may never be less than $100,000. Beginning with assessment year 2015, the
76.33commissioner of revenue must certify the limit for each assessment year by November 1
76.34of the previous year.
77.1EFFECTIVE DATE.This section is effective beginning with taxes assessed in 2017
77.2and payable in 2018.

77.3    Sec. 16. Minnesota Statutes 2016, section 273.13, subdivision 34, is amended to read:
77.4    Subd. 34. Homestead of disabled veteran or family caregiver. (a) All or a portion of
77.5the market value of property owned by a veteran and serving as the veteran's homestead
77.6under this section is excluded in determining the property's taxable market value if the
77.7veteran has a service-connected disability of 70 percent or more as certified by the United
77.8States Department of Veterans Affairs. To qualify for exclusion under this subdivision, the
77.9veteran must have been honorably discharged from the United States armed forces, as
77.10indicated by United States Government Form DD214 or other official military discharge
77.11papers.
77.12    (b)(1) For a disability rating of 70 percent or more, $150,000 of market value is excluded,
77.13except as provided in clause (2); and
77.14    (2) for a total (100 percent) and permanent disability, $300,000 of market value is
77.15excluded.
77.16    (c) If a disabled veteran qualifying for a valuation exclusion under paragraph (b), clause
77.17(2), predeceases the veteran's spouse, and if upon the death of the veteran the spouse holds
77.18the legal or beneficial title to the homestead and permanently resides there, the exclusion
77.19shall carry over to the benefit of the veteran's spouse for the current taxes payable year and
77.20for eight additional taxes payable years or until such time as the spouse remarries, or sells,
77.21transfers, or otherwise disposes of the property, whichever comes first. Qualification under
77.22this paragraph requires an annual application under paragraph (h), and a spouse must notify
77.23the assessor if there is a change in the spouse's marital status, ownership of the property, or
77.24use of the property as a permanent residence.
77.25(d) If the spouse of a member of any branch or unit of the United States armed forces
77.26who dies due to a service-connected cause while serving honorably in active service, as
77.27indicated on United States Government Form DD1300 or DD2064, holds the legal or
77.28beneficial title to a homestead and permanently resides there, the spouse is entitled to the
77.29benefit described in paragraph (b), clause (2), for eight taxes payable years, or until such
77.30time as the spouse remarries or sells, transfers, or otherwise disposes of the property,
77.31whichever comes first.
77.32(e) If a veteran meets the disability criteria of paragraph (a) but does not own property
77.33classified as homestead in the state of Minnesota, then the homestead of the veteran's primary
78.1family caregiver, if any, is eligible for the exclusion that the veteran would otherwise qualify
78.2for under paragraph (b).
78.3    (f) In the case of an agricultural homestead, only the portion of the property consisting
78.4of the house and garage and immediately surrounding one acre of land qualifies for the
78.5valuation exclusion under this subdivision.
78.6    (g) A property qualifying for a valuation exclusion under this subdivision is not eligible
78.7for the market value exclusion under subdivision 35, or classification under subdivision 22,
78.8paragraph (b).
78.9    (h) To qualify for a valuation exclusion under this subdivision a property owner must
78.10apply to the assessor by July 1 of each assessment year, except that an annual reapplication
78.11is not required once a property has been accepted for a valuation exclusion under paragraph
78.12(a) and qualifies for the benefit described in paragraph (b), clause (2), and the property
78.13continues to qualify until there is a change in ownership of the first assessment year for
78.14which the exclusion is sought. For an application received after July 1 of any calendar year,
78.15the exclusion shall become effective for the following assessment year. Except as provided
78.16in paragraph (c), the owner of a property that has been accepted for a valuation exclusion
78.17must notify the assessor if there is a change in ownership of the property or in the use of
78.18the property as a homestead.
78.19(i) A first-time application by a qualifying spouse for the market value exclusion under
78.20paragraph (d) must be made any time within two years of the death of the service member.
78.21(j) For purposes of this subdivision:
78.22(1) "active service" has the meaning given in section 190.05;
78.23(2) "own" means that the person's name is present as an owner on the property deed;
78.24(3) "primary family caregiver" means a person who is approved by the secretary of the
78.25United States Department of Veterans Affairs for assistance as the primary provider of
78.26personal care services for an eligible veteran under the Program of Comprehensive Assistance
78.27for Family Caregivers, codified as United States Code, title 38, section 1720G; and
78.28(4) "veteran" has the meaning given the term in section 197.447.
78.29(k) If a veteran dying after December 31, 2011, did not apply for or receive the exclusion
78.30under paragraph (b), clause (2), before dying, the veteran's spouse is entitled to the benefit
78.31under paragraph (b), clause (2), for eight taxes payable years or until the spouse remarries
78.32or sells, transfers, or otherwise disposes of the property if:
79.1(1) the spouse files a first-time application within two years of the death of the service
79.2member or by June 1, 2019, whichever is later;
79.3(2) upon the death of the veteran, the spouse holds the legal or beneficial title to the
79.4homestead and permanently resides there;
79.5(3) the veteran met the honorable discharge requirements of paragraph (a); and
79.6(4) the United States Department of Veterans Affairs certifies that:
79.7(i) the veteran met the total (100 percent) and permanent disability requirement under
79.8paragraph (b), clause (2); or
79.9(ii) the spouse has been awarded dependency and indemnity compensation.
79.10(l) The purpose of this provision of law providing a level of homestead property tax
79.11relief for gravely disabled veterans, their primary family caregivers, and their surviving
79.12spouses is to help ease the burdens of war for those among our state's citizens who bear
79.13those burdens most heavily.
79.14(m) By July 1, the county veterans service officer must certify the disability rating of
79.15each veteran receiving the benefit under paragraph (b) to the assessor.
79.16EFFECTIVE DATE.This section is effective beginning with taxes payable in 2018.

79.17    Sec. 17. [274.132] PROPERTY OVERVALUED.
79.18    Subdivision 1. Valuation appeals. Notwithstanding any other law to the contrary, when
79.19the value of a property is reduced by a local, special, or county board of appeal and
79.20equalization, the state board of equalization, an order from the Minnesota Tax Court, or an
79.21abatement to correct an error in valuation, a property owner may appeal the valuation of
79.22the property for the taxes payable year immediately preceding the year for which the value
79.23is reduced, provided that the valuation of the property for the immediately preceding taxes
79.24payable year was not previously appealed. An appeal under this subdivision may only be
79.25taken to the Minnesota Tax Court.
79.26    Subd. 2. Credit for overpayment of tax. (a) The county auditor shall credit any refund
79.27determined by the Minnesota Tax Court under subdivision 1 against the succeeding year's
79.28tax payable on the property according to the following schedule:
79.29(1) if the refund is less than 25 percent of the total tax payable on the property for the
79.30current year, it shall be credited to the tax payable on the property in the succeeding taxes
79.31payable year; or
80.1(2) if the refund is 25 percent or more of the total tax payable on the property for the
80.2current year, beginning in the succeeding taxes payable year, it shall be credited to the tax
80.3payable on the property at a rate of 25 percent of the property taxes due per year until
80.4credited in full.
80.5(b) The credit under this subdivision shall reduce the tax payable to each jurisdiction in
80.6proportion to the total tax payable on the property.
80.7EFFECTIVE DATE.This section is effective for appeals, orders, and abatements in
80.82018 and thereafter.

80.9    Sec. 18. Minnesota Statutes 2016, section 275.025, subdivision 1, is amended to read:
80.10    Subdivision 1. Levy amount. (a) The state general levy is levied against
80.11commercial-industrial property and seasonal residential recreational property, as defined
80.12in this section. The state general levy base amount is $592,000,000 for commercial-industrial
80.13property is $764,920,000 for taxes payable in 2002 2018. The state general levy base amount
80.14for seasonal-recreational property is $44,190,000 for taxes payable in 2018.
80.15(b) For taxes payable in subsequent years, the levy base amount is amounts are increased
80.16each year by multiplying the levy base amount for the prior year by the sum of one plus the
80.17rate of increase, if any, in the implicit price deflator for government consumption
80.18expenditures and gross investment for state and local governments prepared by the Bureau
80.19of Economic Analysts of the United States Department of Commerce for the 12-month
80.20period ending March 31 of the year prior to the year the taxes are payable. The tax under
80.21this section is not treated as a local tax rate under section 469.177 and is not the levy of a
80.22governmental unit under chapters 276A and 473F.
80.23The commissioner shall increase or decrease the preliminary or final rate for a year as
80.24necessary to account for errors and tax base changes that affected a preliminary or final rate
80.25for either of the two preceding years. Adjustments are allowed to the extent that the necessary
80.26information is available to the commissioner at the time the rates for a year must be certified,
80.27and for the following reasons:
80.28(1) an erroneous report of taxable value by a local official;
80.29(2) an erroneous calculation by the commissioner; and
80.30(3) an increase or decrease in taxable value for commercial-industrial or seasonal
80.31residential recreational property reported on the abstracts of tax lists submitted under section
80.32275.29 that was not reported on the abstracts of assessment submitted under section 270C.89
80.33for the same year.
81.1The commissioner may, but need not, make adjustments if the total difference in the tax
81.2levied for the year would be less than $100,000.
81.3EFFECTIVE DATE.This section is effective for taxes payable in 2018 and thereafter.

81.4    Sec. 19. Minnesota Statutes 2016, section 275.025, subdivision 2, is amended to read:
81.5    Subd. 2. Commercial-industrial tax capacity. For the purposes of this section,
81.6"commercial-industrial tax capacity" means the tax capacity of all taxable property classified
81.7as class 3 or class 5(1) under section 273.13, except for excluding:
81.8(1) the tax capacity attributable to the first $150,000 of market value of each parcel of
81.9commercial-industrial property as defined under section 273.13, subdivision 24, clauses (1)
81.10and (2);
81.11(2) electric generation attached machinery under class 3; and
81.12(3) property described in section 473.625.
81.13County commercial-industrial tax capacity amounts are not adjusted for the captured
81.14net tax capacity of a tax increment financing district under section 469.177, subdivision 2,
81.15the net tax capacity of transmission lines deducted from a local government's total net tax
81.16capacity under section 273.425, or fiscal disparities contribution and distribution net tax
81.17capacities under chapter 276A or 473F. For purposes of this subdivision, the procedures
81.18for determining eligibility for tier 1 under section 273.13, subdivision 24, clauses (1) and
81.19(2), shall apply in determining the portion of a property eligible to be considered within the
81.20first $150,000 of market value.
81.21EFFECTIVE DATE.This section is effective for taxes payable in 2018 and thereafter.

81.22    Sec. 20. Minnesota Statutes 2016, section 275.025, subdivision 4, is amended to read:
81.23    Subd. 4. Apportionment and levy of state general tax. Ninety-five percent of The
81.24state general tax must be levied by applying a uniform rate to all commercial-industrial tax
81.25capacity and five percent of the state general tax must be levied by applying a uniform rate
81.26to all seasonal residential recreational tax capacity. On or before October 1 each year, the
81.27commissioner of revenue shall certify the preliminary state general levy rates to each county
81.28auditor that must be used to prepare the notices of proposed property taxes for taxes payable
81.29in the following year. By January 1 of each year, the commissioner shall certify the final
81.30state general levy rate rates to each county auditor that shall be used in spreading taxes.
81.31EFFECTIVE DATE.This section is effective for taxes payable in 2018 and thereafter.

82.1    Sec. 21. Minnesota Statutes 2016, section 275.025, is amended by adding a subdivision
82.2to read:
82.3    Subd. 5. Underserved municipalities distribution. (a) Any municipality that:
82.4(1) lies wholly or partially within the metropolitan area as defined under section 473.121,
82.5subdivision 2, but outside the transit taxing district as defined under section 473.446,
82.6subdivision 2; and
82.7(2) has a net fiscal disparities contribution equal to or greater than eight percent of its
82.8total taxable net tax capacity,
82.9is eligible for a distribution from the proceeds of the state general levy imposed on taxpayers
82.10within the municipality.
82.11(b) The distribution is equal to (1) the municipality's net tax capacity tax rate, times (2)
82.12the municipality's net fiscal disparities contribution in excess of eight percent of its total
82.13taxable net tax capacity; provided, however, that the distribution may not exceed the tax
82.14under this section imposed on taxpayers within the municipality.
82.15(c) The distribution under this subdivision must be paid to the qualifying municipality
82.16at the same time taxes are settled under sections 276.09 to 276.111.
82.17(d) For purposes of this subdivision, the following terms have the meanings given.
82.18(1) "Municipality" means a home rule or statutory city, or a town, except that in the case
82.19of a city that lies only partially within the metropolitan area, municipality means the portion
82.20of the city lying within the metropolitan area.
82.21(2) "Net fiscal disparities contribution" means a municipality's fiscal disparities
82.22contribution tax capacity minus its distribution net tax capacity.
82.23(3) "Total taxable net tax capacity" means the total net tax capacity of all properties in
82.24the municipality under section 273.13 minus (i) the net fiscal disparities contribution, and
82.25(ii) the municipality's tax increment captured net tax capacity.
82.26EFFECTIVE DATE.This section is effective for taxes payable in 2018 and thereafter.

82.27    Sec. 22. Minnesota Statutes 2016, section 275.066, is amended to read:
82.28275.066 SPECIAL TAXING DISTRICTS; DEFINITION.
82.29    For the purposes of property taxation and property tax state aids, the term "special taxing
82.30districts" includes the following entities:
82.31    (1) watershed districts under chapter 103D;
83.1    (2) sanitary districts under sections 442A.01 to 442A.29;
83.2    (3) regional sanitary sewer districts under sections 115.61 to 115.67;
83.3    (4) regional public library districts under section 134.201;
83.4    (5) park districts under chapter 398;
83.5    (6) regional railroad authorities under chapter 398A;
83.6    (7) hospital districts under sections 447.31 to 447.38;
83.7    (8) St. Cloud Metropolitan Transit Commission under sections 458A.01 to 458A.15;
83.8    (9) Duluth Transit Authority under sections 458A.21 to 458A.37;
83.9    (10) regional development commissions under sections 462.381 to 462.398;
83.10    (11) housing and redevelopment authorities under sections 469.001 to 469.047;
83.11    (12) port authorities under sections 469.048 to 469.068;
83.12    (13) economic development authorities under sections 469.090 to 469.1081;
83.13    (14) Metropolitan Council under sections 473.123 to 473.549;
83.14    (15) Metropolitan Airports Commission under sections 473.601 to 473.679;
83.15    (16) Metropolitan Mosquito Control Commission under sections 473.701 to 473.716;
83.16    (17) Morrison County Rural Development Financing Authority under Laws 1982, chapter
83.17437, section 1;
83.18    (18) Croft Historical Park District under Laws 1984, chapter 502, article 13, section 6;
83.19    (19) East Lake County Medical Clinic District under Laws 1989, chapter 211, sections
83.201 to 6;
83.21    (20) Floodwood Area Ambulance District under Laws 1993, chapter 375, article 5,
83.22section 39;
83.23    (21) Middle Mississippi River Watershed Management Organization under sections
83.24103B.211 and 103B.241;
83.25    (22) emergency medical services special taxing districts under section 144F.01;
83.26    (23) a county levying under the authority of section 103B.241, 103B.245, or 103B.251,
83.27or 103C.331
;
83.28    (24) Southern St. Louis County Special Taxing District; Chris Jensen Nursing Home
83.29under Laws 2003, First Special Session chapter 21, article 4, section 12;
84.1    (25) an airport authority created under section 360.0426; and
84.2    (26) any other political subdivision of the state of Minnesota, excluding counties, school
84.3districts, cities, and towns, that has the power to adopt and certify a property tax levy to the
84.4county auditor, as determined by the commissioner of revenue.

84.5    Sec. 23. Minnesota Statutes 2016, section 276.017, subdivision 3, is amended to read:
84.6    Subd. 3. United States Postal Service postmark Proof of timely payment. The
84.7postmark or registration mark of the United States Postal Service qualifies as proof of timely
84.8mailing for this section. If the payment is sent by United States registered mail, the date of
84.9registration is the postmark date. If the payment is sent by United States certified mail, the
84.10date of the United States Postal Service postmark on the receipt given to the person presenting
84.11the payment for delivery is the date of mailing. Mailing, or the time of mailing, may also
84.12be established by a delivery service's records or other available evidence except that. The
84.13postmark of a private postage meter or internet stamp may not be used as proof of a timely
84.14mailing made under this section.

84.15    Sec. 24. Minnesota Statutes 2016, section 279.01, subdivision 1, is amended to read:
84.16    Subdivision 1. Due dates; penalties. Except as provided in subdivisions 3 to 5, on May
84.1716 or 21 days after the postmark date on the envelope containing the property tax statement,
84.18whichever is later, a penalty accrues and thereafter is charged upon all unpaid taxes on real
84.19estate on the current lists in the hands of the county treasurer. The (a) When the taxes against
84.20any tract or lot exceed $100, one-half of the amount of tax due must be paid prior to May
84.2116, and the remaining one-half must be paid prior to the following October 16. If either tax
84.22amount is unpaid as of its due date, a penalty is imposed at a rate of two percent on homestead
84.23property until May 31 and four percent on nonhomestead property. If complete payment
84.24has not been made by the first day of the month following either due date, an additional
84.25penalty of two percent on June 1. The penalty on nonhomestead property is at a rate of four
84.26percent until May 31 homestead property and eight four percent on June 1. This penalty
84.27does not accrue until June 1 of each year, or 21 days after the postmark date on the envelope
84.28containing the property tax statements, whichever is later, on commercial use real property
84.29used for seasonal residential recreational purposes and classified as class 1c or 4c, and on
84.30other commercial use real property classified as class 3a, provided that over 60 percent of
84.31the gross income earned by the enterprise on the class 3a property is earned during the
84.32months of May, June, July, and August. In order for the first half of the tax due on class 3a
84.33property to be paid after May 15 and before June 1, or 21 days after the postmark date on
85.1the envelope containing the property tax statement, whichever is later, without penalty, the
85.2owner of the property must attach an affidavit to the payment attesting to compliance with
85.3the income provision of this subdivision nonhomestead property is imposed. Thereafter,
85.4for both homestead and nonhomestead property, on the first day of each subsequent month
85.5beginning July 1, up to and including October 1 following through December, an additional
85.6penalty of one percent for each month accrues and is charged on all such unpaid taxes
85.7provided that if the due date was extended beyond May 15 as the result of any delay in
85.8mailing property tax statements no additional penalty shall accrue if the tax is paid by the
85.9extended due date. If the tax is not paid by the extended due date, then all penalties that
85.10would have accrued if the due date had been May 15 shall be charged. When the taxes
85.11against any tract or lot exceed $100, one-half thereof may be paid prior to May 16 or 21
85.12days after the postmark date on the envelope containing the property tax statement, whichever
85.13is later; and, if so paid, no penalty attaches; the remaining one-half may be paid at any time
85.14prior to October 16 following, without penalty; but, if not so paid, then a penalty of two
85.15percent accrues thereon for homestead property and a penalty of four percent on
85.16nonhomestead property. Thereafter, for homestead property, on the first day of November
85.17an additional penalty of four percent accrues and on the first day of December following,
85.18an additional penalty of two percent accrues and is charged on all such unpaid taxes.
85.19Thereafter, for nonhomestead property, on the first day of November and December
85.20following, an additional penalty of four percent for each month accrues and is charged on
85.21all such unpaid taxes. If one-half of such taxes are not paid prior to May 16 or 21 days after
85.22the postmark date on the envelope containing the property tax statement, whichever is later,
85.23the same may be paid at any time prior to October 16, with accrued penalties to the date of
85.24payment added, and thereupon no penalty attaches to the remaining one-half until October
85.2516 following the penalty must not exceed eight percent in the case of homestead property,
85.26or 12 percent in the case of nonhomestead property.
85.27(b) If the property tax statement was not postmarked prior to April 25, the first half
85.28payment due date in paragraph (a) shall be 21 days from the postmark date of the property
85.29tax statement, and all penalties referenced in paragraph (a) shall be determined with regard
85.30to the later due date.
85.31(c) In the case of a tract or lot with taxes of $100 or less, the due date and penalties as
85.32specified in paragraph (a) or (b) for the first half payment shall apply to the entire amount
85.33of the tax due.
85.34(d) For commercial use real property used for seasonal residential recreational purposes
85.35and classified as class 1c or 4c, and on other commercial use real property classified as class
86.13a, provided that over 60 percent of the gross income earned by the enterprise on the class
86.23a property is earned during the months of May, June, July, and August, the first half
86.3payment is due prior to June 1. For a class 3a property to qualify for the later due date, the
86.4owner of the property must attach an affidavit to the payment attesting to compliance with
86.5the income requirements of this paragraph.
86.6    (e) This section applies to payment of personal property taxes assessed against
86.7improvements to leased property, except as provided by section 277.01, subdivision 3.
86.8    (f) A county may provide by resolution that in the case of a property owner that has
86.9multiple tracts or parcels with aggregate taxes exceeding $100, payments may be made in
86.10installments as provided in this subdivision.
86.11    (g) The county treasurer may accept payments of more or less than the exact amount of
86.12a tax installment due. Payments must be applied first to the oldest installment that is due
86.13but which has not been fully paid. If the accepted payment is less than the amount due,
86.14payments must be applied first to the penalty accrued for the year or the installment being
86.15paid. Acceptance of partial payment of tax does not constitute a waiver of the minimum
86.16payment required as a condition for filing an appeal under section 278.03 or any other law,
86.17nor does it affect the order of payment of delinquent taxes under section 280.39.
86.18EFFECTIVE DATE.This section is effective beginning with taxes payable in 2018.

86.19    Sec. 25. Minnesota Statutes 2016, section 279.01, subdivision 2, is amended to read:
86.20    Subd. 2. Abatement of penalty. (a) The county board may, with the concurrence of the
86.21county treasurer, delegate to the county treasurer the power to abate the penalty provided
86.22for late payment of taxes in the current year. Notwithstanding section 270C.86, if any county
86.23board so elects, the county treasurer may abate the penalty on finding that the imposition
86.24of the penalty would be unjust and unreasonable.
86.25(b) The county treasurer shall abate the penalty provided for late payment of taxes in
86.26the current year if the property tax payment is delivered by mail to the county treasurer and
86.27the envelope containing the payment is postmarked by the United States Postal Service
86.28within one business day of the due date prescribed under this section, but only if the property
86.29owner requesting the abatement has not previously received an abatement of penalty for
86.30late payment of tax under this paragraph.
86.31EFFECTIVE DATE.This section is effective for property taxes payable in 2018 and
86.32thereafter.

87.1    Sec. 26. Minnesota Statutes 2016, section 279.01, subdivision 3, is amended to read:
87.2    Subd. 3. Agricultural property. (a) In the case of class 1b agricultural homestead, class
87.32a agricultural homestead property, and class 2a agricultural nonhomestead property, and
87.4class 2b rural vacant land, no penalties shall attach to the second one-half property tax
87.5payment as provided in this section if paid by November 15. Thereafter for class 1b
87.6agricultural homestead and class 2a homestead property, on November 16 following, a
87.7penalty of six percent shall accrue and be charged on all such unpaid taxes and on December
87.81 following, an additional two percent shall be charged on all such unpaid taxes. Thereafter
87.9for class 2a agricultural nonhomestead property, on November 16 following, a penalty of
87.10eight percent shall accrue and be charged on all such unpaid taxes and on December 1
87.11following, an additional four percent shall be charged on all such unpaid taxes, penalties
87.12shall attach as provided in subdivision 1.
87.13If the owner of class 1b agricultural homestead or class 2a agricultural property receives
87.14a consolidated property tax statement that shows only an aggregate of the taxes and special
87.15assessments due on that property and on other property not classified as class 1b agricultural
87.16homestead or class 2a agricultural property, the aggregate tax and special assessments shown
87.17due on the property by the consolidated statement will be due on November 15.
87.18(b) Notwithstanding paragraph (a), for taxes payable in 2010 and 2011, for any class 2b
87.19property that was subject to a second-half due date of November 15 for taxes payable in
87.202009, the county shall not impose, or if imposed, shall abate penalty amounts in excess of
87.21those that would apply as if the second-half due date were November 15.
87.22EFFECTIVE DATE.(a) Except as provided in paragraph (b), this section is effective
87.23beginning with taxes payable in 2018.
87.24(b) For property in the northern forest region, the provisions in this section applicable
87.25to class 2b rural vacant land are effective beginning with taxes payable in 2019.

87.26    Sec. 27. Minnesota Statutes 2016, section 279.37, is amended by adding a subdivision to
87.27read:
87.28    Subd. 1b. Conditions. The county auditor may offer on a voluntary basis financial
87.29literacy counseling as part of entering into a confession of judgment. The county auditor
87.30may fund the financial literacy counseling using the fee in subdivision 8. The counseling
87.31shall not be at taxpayer expense.

88.1    Sec. 28. Minnesota Statutes 2016, section 281.17, is amended to read:
88.2281.17 PERIOD FOR OF REDEMPTION.
88.3(a) Except for properties described in paragraphs (b) and (c), or properties for which the
88.4period of redemption has been limited under sections 281.173 and 281.174, the following
88.5periods for period of redemption apply.
88.6The period of redemption for all lands sold to the state at a tax judgment sale shall be
88.7three years from the date of sale to the state of Minnesota.
88.8The period of redemption for homesteaded lands as defined in section 273.13, subdivision
88.922
, located in a targeted neighborhood as defined in Laws 1987, chapter 386, article 6,
88.10section 4, and sold to the state at a tax judgment sale is three years from the date of sale.
88.11(b) The period of redemption for all lands located in a targeted neighborhood community
88.12as defined in Laws 1987, chapter 386, article 6, section 4 section 469.201, subdivision 10,
88.13except homesteaded lands as defined in section 273.13, subdivision 22, is one year from
88.14the date of sale.
88.15(c) The period of redemption for all real property constituting a mixed municipal solid
88.16waste disposal facility that is a qualified facility under section 115B.39, subdivision 1, is
88.17one year from the date of the sale to the state of Minnesota.
88.18(d) In determining the period of redemption, the county must use the property's
88.19classification and homestead classification for the assessment year on which the tax judgment
88.20is based. Any change in the property's classification or homestead classification after the
88.21assessment year on which the tax judgment is based does not affect the period of redemption.

88.22    Sec. 29. Minnesota Statutes 2016, section 281.173, subdivision 2, is amended to read:
88.23    Subd. 2. Summons and complaint. Any city, county, housing and redevelopment
88.24authority, port authority, or economic development authority, in which the premises are
88.25located may commence an action in district court to reduce the period otherwise allowed
88.26for redemption under this chapter. The action must be commenced by the filing of a
88.27complaint, naming as defendants the record fee owners or the owner's personal representative,
88.28or the owner's heirs as determined by a court of competent jurisdiction, contract for deed
88.29purchasers, mortgagees, assigns of any of the above, the taxpayers as shown on the records
88.30of the county auditor, the Internal Revenue Service of the United States and the Revenue
88.31Department of the state of Minnesota if tax liens against the owners or contract for deed
88.32purchasers have been recorded or filed; and any other person the plaintiff determines should
88.33be made a party. The action shall be filed in district court for the county in which the premises
89.1are located. The complaint must identify the premises by legal description. The complaint
89.2must allege (1) that the premises are abandoned, (2) that the tax judgment sale pursuant to
89.3section 280.01 has been made, and (3) notice of expiration of the time for redemption has
89.4not been given.
89.5The complaint must request an order reducing the redemption period to five weeks.
89.6When the complaint has been filed, the court shall issue a summons commanding the person
89.7or persons named in the complaint to appear before the court on a day and at a place stated
89.8in the summons. The appearance date shall be not less than 15 nor more than 25 days from
89.9the date of the issuing of the summons. A copy of the filed complaint must be attached to
89.10the summons.

89.11    Sec. 30. Minnesota Statutes 2016, section 281.174, subdivision 3, is amended to read:
89.12    Subd. 3. Summons and complaint. Any city, county, housing and redevelopment
89.13authority, port authority, or economic development authority in which the property is located
89.14may commence an action in district court to reduce the period otherwise allowed for
89.15redemption under this chapter from the date of the requested order. The action must be
89.16commenced by the filing of a complaint, naming as defendants the record fee owners or the
89.17owner's personal representative, or the owner's heirs as determined by a court of competent
89.18jurisdiction, contract for deed purchasers, mortgagees, assigns of any of the above, the
89.19taxpayers as shown on the records of the county auditor, the Internal Revenue Service of
89.20the United States and the revenue department of the state of Minnesota if tax liens against
89.21the owners or contract for deed purchasers have been recorded or filed, and any other person
89.22the plaintiff determines should be made a party. The action shall be filed in district court
89.23for the county in which the property is located. The complaint must identify the property
89.24by legal description. The complaint must allege (1) that the property is vacant, (2) that the
89.25tax judgment sale under section 280.01 has been made, and (3) notice of expiration of the
89.26time for redemption has not been given.
89.27The complaint must request an order reducing the redemption period to five weeks.
89.28When the complaint has been filed, the court shall issue a summons commanding the person
89.29or persons named in the complaint to appear before the court on a day and at a place stated
89.30in the summons. The appearance date shall be not less than 15 nor more than 25 days from
89.31the date of the issuing of the summons, except that, when the United States of America is
89.32a party, the date shall be set in accordance with applicable federal law. A copy of the filed
89.33complaint must be attached to the summons.

90.1    Sec. 31. [281.231] MAINTENANCE; EXPENDITURE OF PUBLIC FUNDS.
90.2If the county auditor provides notice as required by section 281.23, the state, agency,
90.3political subdivision, or other entity that becomes the fee owner or manager of a property
90.4as a result of forfeiture due to nonpayment of real property taxes is not required to expend
90.5public funds to maintain any servitude, agreement, easement, or other encumbrance affecting
90.6the property. The fee owner or manager of a property may, at its discretion, spend public
90.7funds necessary for the maintenance, security, or management of the property.

90.8    Sec. 32. [281.70] LIMITED RIGHT OF ENTRY.
90.9    Subdivision 1. Limited right of entry. If premises described in a real estate tax judgment
90.10sale are vacant or unoccupied, the county auditor or a person acting on behalf of the county
90.11auditor may, but is not obligated to, enter the premises to protect the premises from waste
90.12or trespass until the county auditor is notified that the premises are occupied. An affidavit
90.13of the sheriff, the county auditor, or a person acting on behalf of the county auditor describing
90.14the premises and stating that the premises are vacant and unoccupied is prima facie evidence
90.15of the facts stated in the affidavit. If the affidavit contains a legal description of the premises,
90.16the affidavit may be recorded in the office of the county recorder or the registrar of titles in
90.17the county where the premises are located.
90.18    Subd. 2. Authorized actions. (a) The county auditor may take one or more of the
90.19following actions to protect the premises from waste or trespass:
90.20(1) install or change locks on doors and windows;
90.21(2) board windows; and
90.22(3) other actions to prevent or minimize damage to the premises from the elements,
90.23vandalism, trespass, or other illegal activities.
90.24(b) If the county auditor installs or changes locks on premises under paragraph (a), the
90.25county auditor must promptly deliver a key to the premises to the taxpayer or any person
90.26lawfully claiming through the taxpayer upon request.
90.27    Subd. 3. Costs. Costs incurred by the county auditor in protecting the premises from
90.28waste or trespass under this section may be added to the delinquent taxes due. The costs
90.29may bear interest to the extent provided, and interest may be added to the delinquent taxes
90.30due.
91.1    Subd. 4. Scope. The actions authorized under this section are in addition to, and do not
91.2limit or replace, any other rights or remedies available to the county auditor under Minnesota
91.3law.

91.4    Sec. 33. Minnesota Statutes 2016, section 282.01, subdivision 4, is amended to read:
91.5    Subd. 4. Sale:; method,; requirements,; effects. (a) The sale authorized under
91.6subdivision 3 must be conducted by the county auditor at the county seat of the county in
91.7which the parcels lie, except that in St. Louis and Koochiching Counties, the sale may be
91.8conducted in any county facility within the county. The sale must not be for less than the
91.9appraised value except as provided in subdivision 7a. The parcels must be sold for cash
91.10only, unless the county board of the county has adopted a resolution providing for their sale
91.11on terms, in which event the resolution controls with respect to the sale. When the sale is
91.12made on terms other than for cash only (1) a payment of at least ten percent of the purchase
91.13price must be made at the time of purchase, and the balance must be paid in no more than
91.14ten equal annual installments, or (2) the payments must be made in accordance with county
91.15board policy, but in no event may the board require more than 12 installments annually,
91.16and the contract term must not be for more than ten years. Standing timber or timber products
91.17must not be removed from these lands until an amount equal to the appraised value of all
91.18standing timber or timber products on the lands at the time of purchase has been paid by
91.19the purchaser. If a parcel of land bearing standing timber or timber products is sold at public
91.20auction for more than the appraised value, the amount bid in excess of the appraised value
91.21must be allocated between the land and the timber in proportion to their respective appraised
91.22values. In that case, standing timber or timber products must not be removed from the land
91.23until the amount of the excess bid allocated to timber or timber products has been paid in
91.24addition to the appraised value of the land. The purchaser is entitled to immediate possession,
91.25subject to the provisions of any existing valid lease made in behalf of the state.
91.26(b) For sales occurring on or after July 1, 1982, the unpaid balance of the purchase price
91.27is subject to interest at the rate determined pursuant to section 549.09. The unpaid balance
91.28of the purchase price for sales occurring after December 31, 1990, is subject to interest at
91.29the rate determined in section 279.03, subdivision 1a. The interest rate is subject to change
91.30each year on the unpaid balance in the manner provided for rate changes in section 549.09
91.31or 279.03, subdivision 1a, whichever, is applicable. Interest on the unpaid contract balance
91.32on sales occurring before July 1, 1982, is payable at the rate applicable to the sale at the
91.33time that the sale occurred.
92.1(c) Notwithstanding subdivision 7, a county board may by resolution provide for the
92.2listing and sale of individual parcels by other means, including through a real estate broker.
92.3However, if the buyer under this paragraph could have repurchased a parcel of property
92.4under section 282.012 or 282.241, that buyer may not purchase that same parcel of property
92.5at the sale under this subdivision for a purchase price less than the sum of all taxes,
92.6assessments, penalties, interest, and costs due at the time of forfeiture computed under
92.7section 282.251, and any special assessments for improvements certified as of the date of
92.8sale. This subdivision shall be liberally construed to encourage the sale and utilization of
92.9tax-forfeited land in order to eliminate nuisances and dangerous conditions and to increase
92.10compliance with land use ordinances.

92.11    Sec. 34. Minnesota Statutes 2016, section 282.01, subdivision 6, is amended to read:
92.12    Subd. 6. Duties of commissioner after sale. (a) When any sale has been made by the
92.13county auditor under sections 282.01 to 282.13, the auditor shall immediately certify to the
92.14commissioner of revenue such information relating to such sale, on such forms as the
92.15commissioner of revenue may prescribe as will enable the commissioner of revenue to
92.16prepare an appropriate deed if the sale is for cash, or keep necessary records if the sale is
92.17on terms; and not later than October 31 of each year the county auditor shall submit to the
92.18commissioner of revenue a statement of all instances wherein any payment of principal,
92.19interest, or current taxes on lands held under certificate, due or to be paid during the preceding
92.20calendar years, are still outstanding at the time such certificate is made. When such statement
92.21shows that a purchaser or the purchaser's assignee is in default, the commissioner of revenue
92.22may instruct the county board of the county in which the land is located to cancel said
92.23certificate of sale in the manner provided by subdivision 5, provided that upon
92.24recommendation of the county board, and where the circumstances are such that the
92.25commissioner of revenue after investigation is satisfied that the purchaser has made every
92.26effort reasonable to make payment of both the annual installment and said taxes, and that
92.27there has been no willful neglect on the part of the purchaser in meeting these obligations,
92.28then the commissioner of revenue may extend the time for the payment for such period as
92.29the commissioner may deem warranted, not to exceed one year. On payment in full of the
92.30purchase price, appropriate conveyance in fee, in such form as may be prescribed by the
92.31attorney general, shall be issued by the commissioner of revenue, which conveyance must
92.32be recorded by the county and shall have the force and effect of a patent from the state
92.33subject to easements and restrictions of record at the date of the tax judgment sale, including,
92.34but without limitation, permits for telephone and electric power lines either by underground
93.1cable or conduit or otherwise, sewer and water lines, highways, railroads, and pipe lines for
93.2gas, liquids, or solids in suspension.
93.3(b) The commissioner of revenue shall issue an appropriate conveyance in fee upon the
93.4receipt of a loan commitment or approval from the county auditor. For purposes of this
93.5paragraph, "loan commitment" or "loan approval" means a written commitment or approval
93.6to make a mortgage loan from a lender approved to make mortgage loans in Minnesota.
93.7The conveyance shall be issued to the county auditor where the land is located. Upon receipt
93.8of the conveyance, the county auditor shall hold the conveyance until such time as the
93.9conveyance is requested from a title company licensed to do business in Minnesota. If a
93.10request for the conveyance is not made within 45 days of the date the conveyance is issued
93.11by the commissioner of revenue, the county auditor shall return the conveyance to the
93.12commissioner. The title company making the request for the conveyance shall certify to the
93.13county auditor that the conveyance is necessary to close the purchase of the subject property
93.14within five days of the request. If the conveyance is delivered to the title company and the
93.15closing does not occur within five days of the request, the title company shall immediately
93.16return the conveyance to the county auditor, and upon receipt, the county auditor shall return
93.17the deed to the commissioner of revenue. The commissioner of revenue shall destroy all
93.18deeds returned by the county auditor pursuant to this subdivision.

93.19    Sec. 35. Minnesota Statutes 2016, section 282.01, is amended by adding a subdivision to
93.20read:
93.21    Subd. 13. Online auction. A county board, or a county auditor if the auditor has been
93.22delegated such authority under section 282.135, may sell tax-forfeited lands through an
93.23online auction. When an online auction is used to sell tax-forfeited lands, the county auditor
93.24shall post a physical notice of the online auction and shall publish a notice of the online
93.25auction on its Web site not less than ten days before the online auction begins, in addition
93.26to any other notice required.
93.27EFFECTIVE DATE.This section is effective for sales of tax-forfeited property that
93.28occur on or after August 1, 2017.

93.29    Sec. 36. Minnesota Statutes 2016, section 282.016, is amended to read:
93.30282.016 PROHIBITED PURCHASERS.
93.31(a) A county auditor, county treasurer, county attorney, court administrator of the district
93.32court, county assessor, supervisor of assessments, deputy or clerk or an employee of such
93.33officer, a commissioner for tax-forfeited lands or an assistant to such commissioner, must
94.1not become a purchaser, either personally or as an agent or attorney for another person, of
94.2the properties offered for sale under the provisions of this chapter in the county for which
94.3the person performs duties. A person prohibited from purchasing property under this section
94.4must not directly or indirectly have another person purchase it on behalf of the prohibited
94.5purchaser for the prohibited purchaser's benefit or gain.
94.6(b) Notwithstanding paragraph (a), such officer, deputy, clerk, or employee or
94.7commissioner for tax-forfeited lands or assistant to such commissioner may (1) purchase
94.8lands owned by that official at the time the state became the absolute owner thereof or (2)
94.9bid upon and purchase forfeited property offered for sale under the alternate sale procedure
94.10described in section 282.01, subdivision 7a.
94.11(c) In addition to the persons identified in paragraph (a), a county auditor may prohibit
94.12other persons and entities from becoming a purchaser, either personally or as an agent or
94.13attorney for another person or entity, of the properties offered for sale under this chapter in
94.14the following circumstances: (1) the person or entity owns another property within the
94.15county for which there are delinquent taxes owing; (2) the person or entity has held a rental
94.16license in the county and the license has been revoked within the last five years; (3) the
94.17person or entity has been the vendee of a contract for purchase of a property offered for sale
94.18under this chapter, which contract has been canceled within the last five years; or (4) the
94.19person or entity owns another property within the county for which there is an unresolved
94.20housing code violation, including an unpaid charge or fine.
94.21(d) A person prohibited from purchasing property under this section must not directly
94.22or indirectly have another person purchase it on behalf of the prohibited purchaser for the
94.23prohibited purchaser's benefit or gain.

94.24    Sec. 37. Minnesota Statutes 2016, section 282.018, subdivision 1, is amended to read:
94.25    Subdivision 1. Land on or adjacent to public waters. (a) All land which is the property
94.26of the state as a result of forfeiture to the state for nonpayment of taxes, regardless of whether
94.27the land is held in trust for taxing districts, and which borders on or is adjacent to meandered
94.28lakes and other public waters and watercourses, and the live timber growing or being thereon,
94.29is hereby withdrawn from sale except as hereinafter provided. The authority having
94.30jurisdiction over the timber on any such lands may sell the timber as otherwise provided by
94.31law for cutting and removal under such conditions as the authority may prescribe in
94.32accordance with approved, sustained yield forestry practices. The authority having jurisdiction
94.33over the timber shall reserve such timber and impose such conditions as the authority deems
94.34necessary for the protection of watersheds, wildlife habitat, shorelines, and scenic features.
95.1Within the area in Cook, Lake, and St. Louis counties described in the Act of Congress
95.2approved July 10, 1930 (46 Stat. 1020), the timber on tax-forfeited lands shall be subject
95.3to like restrictions as are now imposed by that act on federal lands.
95.4(b) Of all tax-forfeited land bordering on or adjacent to meandered lakes and other public
95.5waters and watercourses and so withdrawn from sale, a strip two rods in width, the ordinary
95.6high-water mark being the waterside boundary thereof, and the land side boundary thereof
95.7being a line drawn parallel to the ordinary high-water mark and two rods distant landward
95.8therefrom, hereby is reserved for public travel thereon, and whatever the conformation of
95.9the shore line or conditions require, the authority having jurisdiction over such lands shall
95.10reserve a wider strip for such purposes.
95.11(c) Any tract or parcel of land which has 150 feet or less of waterfront may be sold by
95.12the authority having jurisdiction over the land, in the manner otherwise provided by law
95.13for the sale of such lands, if the authority determines that it is in the public interest to do
95.14so. If the authority having jurisdiction over the land is not the commissioner of natural
95.15resources, the land may not be offered for sale without the prior approval of the commissioner
95.16of natural resources.
95.17(d) Where the authority having jurisdiction over lands withdrawn from sale under this
95.18section is not the commissioner of natural resources, the authority may submit proposals
95.19for disposition of the lands to the commissioner. The commissioner of natural resources
95.20shall evaluate the lands and their public benefits and make recommendations on the proposed
95.21dispositions to the committees of the legislature with jurisdiction over natural resources.
95.22The commissioner shall include any recommendations of the commissioner for disposition
95.23of lands withdrawn from sale under this section over which the commissioner has jurisdiction.
95.24The commissioner's recommendations may include a public sale, sale to a private party,
95.25acquisition by the Department of Natural Resources for public purposes, or a cooperative
95.26management agreement with, or transfer to, another unit of government.
95.27(e) Notwithstanding this subdivision, a county may sell property governed by this section
95.28upon written authorization from the commissioner of natural resources. Prior to the sale or
95.29conveyance of lands under this subdivision, the county board must give notice of its intent
95.30to meet for that purpose as provided in section 282.01, subdivision 1.

95.31    Sec. 38. Minnesota Statutes 2016, section 282.02, is amended to read:
95.32282.02 LIST OF LANDS FOR SALE; NOTICE; ONLINE AUCTIONS
95.33PERMITTED.
96.1(a) Immediately after classification and appraisal of the land, and after approval by the
96.2commissioner of natural resources when required pursuant to section 282.01, subdivision
96.33
, the county board shall provide and file with the county auditor a list of parcels of land to
96.4be offered for sale. This list shall contain a description of the parcels of land and the appraised
96.5value thereof. The auditor shall publish a notice of the intended public sale of such parcels
96.6of land and a copy of the resolution of the county board fixing the terms of the sale, if other
96.7than for cash only, by publication once a week for two weeks in the official newspaper of
96.8the county, the last publication to be not less than ten days previous to the commencement
96.9of the sale.
96.10(b) The notice shall include the parcel's description and appraised value. The notice shall
96.11also indicate the amount of any special assessments which may be the subject of a
96.12reassessment or new assessment or which may result in the imposition of a fee or charge
96.13pursuant to sections 429.071, subdivision 4, 435.23, and 444.076. The county auditor shall
96.14also mail notice to the owners of land adjoining the parcel to be sold. For purposes of this
96.15section, "owner" means the taxpayer as listed in the records of the county auditor.
96.16(c) If the county board of St. Louis or Koochiching Counties determines that the sale
96.17shall take place in a county facility other than the courthouse, the notice shall specify the
96.18facility and its location. If the county board determines that the sale shall take place as an
96.19online auction under section 282.01, subdivision 13, the notice shall specify the auction
96.20Web site and the date of the auction.
96.21EFFECTIVE DATE.This section is effective for sales of tax-forfeited property that
96.22occur on or after August 1, 2017.

96.23    Sec. 39. Minnesota Statutes 2016, section 282.241, subdivision 1, is amended to read:
96.24    Subdivision 1. Repurchase requirements. The owner at the time of forfeiture, or the
96.25owner's heirs, devisees, or representatives, or any person to whom the right to pay taxes
96.26was given by statute, mortgage, or other agreement, may repurchase any parcel of land
96.27claimed by the state to be forfeited to the state for taxes unless before the time repurchase
96.28is made the parcel is sold under installment payments, or otherwise, by the state as provided
96.29by law, or is under mineral prospecting permit or lease, or proceedings have been commenced
96.30by the state or any of its political subdivisions or by the United States to condemn the parcel
96.31of land. The parcel of land may be repurchased for the sum of all delinquent taxes and
96.32assessments computed under section 282.251, together with penalties, interest, and costs,
96.33that accrued or would have accrued if the parcel of land had not forfeited to the state. Except
96.34for property which was homesteaded on the date of forfeiture, repurchase is permitted during
97.1one year six months only from the date of forfeiture, and in any case only after the adoption
97.2of a resolution by the board of county commissioners determining that by repurchase undue
97.3hardship or injustice resulting from the forfeiture will be corrected, or that permitting the
97.4repurchase will promote the use of the lands that will best serve the public interest. If the
97.5county board has good cause to believe that a repurchase installment payment plan for a
97.6particular parcel is unnecessary and not in the public interest, the county board may require
97.7as a condition of repurchase that the entire repurchase price be paid at the time of repurchase.
97.8A repurchase is subject to any easement, lease, or other encumbrance granted by the state
97.9before the repurchase, and if the land is located within a restricted area established by any
97.10county under Laws 1939, chapter 340, the repurchase must not be permitted unless the
97.11resolution approving the repurchase is adopted by the unanimous vote of the board of county
97.12commissioners.
97.13The person seeking to repurchase under this section shall pay all maintenance costs
97.14incurred by the county auditor during the time the property was tax-forfeited.
97.15EFFECTIVE DATE.This section is effective January 1, 2018.

97.16    Sec. 40. Minnesota Statutes 2016, section 282.322, is amended to read:
97.17282.322 FORFEITED LANDS LIST.
97.18The county board of any county may file a list of forfeited lands with the county auditor,
97.19if the board is of the opinion that such lands may be acquired by the state or any municipal
97.20subdivision thereof of the state for public purposes. Upon the filing of such the list of
97.21forfeited lands, the county auditor shall withhold said lands from repurchase. If no proceeding
97.22shall be is started to acquire such lands by the state or some municipal subdivision thereof
97.23of the state within one year after the filing of such the list of forfeited lands, the county
97.24board shall withdraw said the list and thereafter, if the property was classified as
97.25nonhomestead at the time of forfeiture, the owner shall have one year not more than six
97.26months in which to repurchase.
97.27EFFECTIVE DATE.This section is effective January 1, 2018.

97.28    Sec. 41. Minnesota Statutes 2016, section 290A.03, subdivision 13, is amended to read:
97.29    Subd. 13. Property taxes payable. "Property taxes payable" means the property tax
97.30exclusive of special assessments, penalties, and interest payable on a claimant's homestead
97.31after deductions made under sections 273.135, 273.1384, 273.1391, 273.42, subdivision 2,
97.32and any other state paid property tax credits in any calendar year, and after any refund
98.1claimed and allowable under section 290A.04, subdivision 2h, that is first payable in the
98.2year that the property tax is payable. In the case of a claimant who makes ground lease
98.3payments, "property taxes payable" includes the amount of the payments directly attributable
98.4to the property taxes assessed against the parcel on which the house is located. No
98.5apportionment or reduction of the "property taxes payable" shall be required for the use of
98.6a portion of the claimant's homestead for a business purpose if the claimant does not deduct
98.7any business depreciation expenses for the use of a portion of the homestead in the
98.8determination of federal adjusted gross income. For homesteads which are manufactured
98.9homes as defined in section 273.125, subdivision 8, and for homesteads which are including
98.10manufactured homes located in a manufactured home community owned by a cooperative
98.11organized under chapter 308A or 308B, and park trailers taxed as manufactured homes
98.12under section 168.012, subdivision 9, "property taxes payable" shall also include 17 percent
98.13of the gross rent paid in the preceding year for the site on which the homestead is located.
98.14When a homestead is owned by two or more persons as joint tenants or tenants in common,
98.15such tenants shall determine between them which tenant may claim the property taxes
98.16payable on the homestead. If they are unable to agree, the matter shall be referred to the
98.17commissioner of revenue whose decision shall be final. Property taxes are considered payable
98.18in the year prescribed by law for payment of the taxes.
98.19In the case of a claim relating to "property taxes payable," the claimant must have owned
98.20and occupied the homestead on January 2 of the year in which the tax is payable and (i) the
98.21property must have been classified as homestead property pursuant to section 273.124, on
98.22or before December 15 of the assessment year to which the "property taxes payable" relate;
98.23or (ii) the claimant must provide documentation from the local assessor that application for
98.24homestead classification has been made on or before December 15 of the year in which the
98.25"property taxes payable" were payable and that the assessor has approved the application.
98.26EFFECTIVE DATE.This section is effective beginning with claims for taxes payable
98.27in 2018.

98.28    Sec. 42. Minnesota Statutes 2016, section 473H.09, is amended to read:
98.29473H.09 EARLY TERMINATION.
98.30    Subdivision 1. Public emergency. Termination of an agricultural preserve earlier than
98.31a date derived through application of section 473H.08 may be permitted only in the event
98.32of a public emergency upon petition from the owner or authority to the governor. The
98.33determination of a public emergency shall be by the governor through executive order
99.1pursuant to sections 4.035 and 12.01 to 12.46. The executive order shall identify the preserve,
99.2the reasons requiring the action and the date of termination.
99.3    Subd. 2. Death of owner. (a) Within 365 days of the death of an owner, an owner's
99.4spouse, or other qualifying person, the surviving owner may elect to terminate the agricultural
99.5preserve and the covenant allowing the land to be enrolled as an agricultural preserve by
99.6notifying the authority on a form provided by the commissioner of agriculture. Termination
99.7of a covenant under this subdivision must be executed and acknowledged in the manner
99.8required by law to execute and acknowledge a deed.
99.9(b) For purposes of this subdivision, the following definitions apply:
99.10(1) "qualifying person" includes a partner, shareholder, trustee for a trust that the decedent
99.11was the settlor or a beneficiary of, or member of an entity permitted to own agricultural
99.12land and engage in farming under section 500.24 that owned the agricultural preserve; and
99.13(2) "surviving owner" includes the executor of the estate of the decedent, trustee for a
99.14trust that the decedent was the settlor or a beneficiary of, or an entity permitted to own farm
99.15land under section 500.24 of which the decedent was a partner, shareholder, or member.
99.16(c) When an agricultural preserve is terminated under this subdivision, the property is
99.17subject to additional taxes in an amount equal to 50 percent of the taxes actually levied
99.18against the property for the current taxes payable year. The additional taxes are extended
99.19against the property on the tax list for taxes payable in the current year. The additional taxes
99.20must be distributed among the jurisdictions levying taxes on the property in proportion to
99.21the current year's taxes.
99.22EFFECTIVE DATE.This section is effective July 1, 2017.

99.23    Sec. 43. Minnesota Statutes 2016, section 473H.17, subdivision 1a, is amended to read:
99.24    Subd. 1a. Allowed commercial and industrial operations. (a) Commercial and industrial
99.25operations are not allowed on land within an agricultural preserve except:
99.26(1) small on-farm commercial or industrial operations normally associated with and
99.27important to farming in the agricultural preserve area;
99.28(2) storage use of existing farm buildings that does not disrupt the integrity of the
99.29agricultural preserve; and
99.30(3) small commercial use of existing farm buildings for trades not disruptive to the
99.31integrity of the agricultural preserve such as a carpentry shop, small scale mechanics shop,
99.32and similar activities that a farm operator might conduct.; and
100.1(4) wireless communication installments and related equipment and structure capable
100.2of providing technology potentially beneficial to farming activities.
100.3(b) For purposes of paragraph (a), clauses (2) and (3), "existing" in paragraph (a), clauses
100.4(2) and (3), means existing on August 1, 1987.
100.5EFFECTIVE DATE.This section is effective the day following enactment.

100.6    Sec. 44. Minnesota Statutes 2016, section 504B.285, subdivision 1, is amended to read:
100.7    Subdivision 1. Grounds. (a) The person entitled to the premises may recover possession
100.8by eviction when:
100.9(1) any person holds over real property:
100.10(i) after a sale of the property on an execution or judgment; or
100.11(ii) after the expiration of the time for redemption on foreclosure of a mortgage, or after
100.12termination of contract to convey the property; or
100.13(iii) after the expiration of the time for redemption on a real estate tax judgment sale;
100.14(2) any person holds over real property after termination of the time for which it is
100.15demised or leased to that person or to the persons under whom that person holds possession,
100.16contrary to the conditions or covenants of the lease or agreement under which that person
100.17holds, or after any rent becomes due according to the terms of such lease or agreement; or
100.18(3) any tenant at will holds over after the termination of the tenancy by notice to quit.
100.19(b) A landlord may not commence an eviction action against a tenant or authorized
100.20occupant solely on the basis that the tenant or authorized occupant has been the victim of
100.21any of the acts listed in section 504B.206, subdivision 1, paragraph (a). Nothing in this
100.22paragraph should be construed to prohibit an eviction action based on a breach of the lease.

100.23    Sec. 45. Minnesota Statutes 2016, section 504B.365, subdivision 3, is amended to read:
100.24    Subd. 3. Removal and storage of property. (a) If the defendant's personal property is
100.25to be stored in a place other than the premises, the officer shall remove all personal property
100.26of the defendant at the expense of the plaintiff.
100.27(b) The defendant must make immediate payment for all expenses of removing personal
100.28property from the premises. If the defendant fails or refuses to do so, the plaintiff has a lien
100.29on all the personal property for the reasonable costs and expenses incurred in removing,
100.30caring for, storing, and transporting it to a suitable storage place.
101.1(c) The plaintiff may enforce the lien by detaining the personal property until paid. If
101.2no payment has been made for 60 days after the execution of the order to vacate, the plaintiff
101.3may dispose of the property or hold a public sale as provided in sections 514.18 to 514.22.
101.4(d) If the defendant's personal property is to be stored on the premises, the officer shall
101.5enter the premises, breaking in if necessary, and the plaintiff may remove the defendant's
101.6personal property. Section 504B.271 applies to personal property removed under this
101.7paragraph. The plaintiff must prepare an inventory and mail a copy of the inventory to the
101.8defendant's last known address or, if the defendant has provided a different address, to the
101.9address provided. The inventory must be prepared, signed, and dated in the presence of the
101.10officer and must include the following:
101.11(1) a list of the items of personal property and a description of their condition;
101.12(2) the date, the signature of the plaintiff or the plaintiff's agent, and the name and
101.13telephone number of a person authorized to release the personal property; and
101.14(3) the name and badge number of the officer.
101.15(e) The officer must retain a copy of the inventory.
101.16(f) The plaintiff is responsible for the proper removal, storage, and care of the defendant's
101.17personal property and is liable for damages for loss of or injury to it caused by the plaintiff's
101.18failure to exercise the same care that a reasonably careful person would exercise under
101.19similar circumstances.
101.20(g) The plaintiff shall notify the defendant of the date and approximate time the officer
101.21is scheduled to remove the defendant, family, and personal property from the premises. The
101.22notice must be sent by first class mail. In addition, the plaintiff must make a good faith
101.23effort to notify the defendant by telephone. The notice must be mailed as soon as the
101.24information regarding the date and approximate time the officer is scheduled to enforce the
101.25order is known to the plaintiff, except that the scheduling of the officer to enforce the order
101.26need not be delayed because of the notice requirement. The notice must inform the defendant
101.27that the defendant and the defendant's personal property will be removed from the premises
101.28if the defendant has not vacated the premises by the time specified in the notice.

101.29    Sec. 46. Laws 1996, chapter 471, article 3, section 51, is amended to read:
101.30    Sec. 51. RECREATION LEVY FOR SAWYER BY CARLTON COUNTY.
101.31    Subdivision 1. Levy authorized. Notwithstanding other law to the contrary, the Carlton
101.32county board of commissioners may levy in and for the unorganized township of Sawyer
102.1an amount up to $1,500 annually for recreational purposes, beginning with taxes payable
102.2in 1997 and ending with taxes payable in 2006.
102.3    Subd. 2. Effective date. This section is effective June 1, 1996, without local approval.
102.4EFFECTIVE DATE.This section applies to taxes payable in 2018 and thereafter, and
102.5is effective the day after the Carlton County Board of Commissioners and its chief clerical
102.6officer timely complete their compliance with section 645.021, subdivisions 2 and 3.

102.7    Sec. 47. SOCCER STADIUM PROPERTY TAX EXEMPTION; SPECIAL
102.8ASSESSMENT.
102.9Any real or personal property acquired, owned, leased, controlled, used, or occupied by
102.10the city of St. Paul for the primary purpose of providing a stadium for a Major League
102.11Soccer team is declared to be acquired, owned, leased, controlled, used, and occupied for
102.12public, governmental, and municipal purposes, and is exempt from ad valorem taxation by
102.13the state or any political subdivision of the state, provided that the properties are subject to
102.14special assessments levied by a political subdivision for a local improvement in amounts
102.15proportionate to and not exceeding the special benefit received by the properties from the
102.16improvement. In determining the special benefit received by the properties, no possible use
102.17of any of the properties in any manner different from their intended use for providing a
102.18Major League Soccer stadium at the time may be considered. Notwithstanding Minnesota
102.19Statutes, section 272.01, subdivision 2, or 273.19, real or personal property subject to a
102.20lease or use agreement between the city and another person for uses related to the purposes
102.21of the operation of the stadium and related parking facilities is exempt from taxation
102.22regardless of the length of the lease or use agreement. This section, insofar as it provides
102.23an exemption or special treatment, does not apply to any real property that is leased for
102.24residential, business, or commercial development or other purposes different from those
102.25necessary to the provision and operation of the stadium.
102.26EFFECTIVE DATE.This section is effective upon approval by the St. Paul City
102.27Council and compliance with Minnesota Statutes, section 645.021.

102.28    Sec. 48. LEGISLATIVE PROPERTY TAX REFORM WORKING GROUP.
102.29    Subdivision 1. Membership. (a) The Legislative Property Tax Reform Working Group
102.30is created and consists of the following members:
102.31(1) two representatives appointed by the chair of the tax committee of the house of
102.32representatives;
103.1(2) two representatives appointed by the minority leader of the tax committee of the
103.2house of representatives;
103.3(3) two senators appointed by the chair of the senate tax committee; and
103.4(4) two senators appointed by the minority leader of the senate tax committee.
103.5(b) Any vacancy shall be filled by appointment of the appointing authority for the vacating
103.6member.
103.7(c) Members shall be appointed by July 1, 2017.
103.8    Subd. 2. Duties. The working group must perform the duties described in section 49.
103.9    Subd. 3. First meeting; chair. The first appointee of the chair of the house of
103.10representatives tax committee must convene the initial meeting of the working group by
103.11July 21, 2017. The members of the working group must elect a chair and vice-chair from
103.12the members of the working group at the first meeting.
103.13    Subd. 4. Staff. Legislative staff of the house of representatives and senate shall provide
103.14administrative and research support. The working group may request the assistance of staff
103.15from the Department of Revenue and Department of Education as necessary to facilitate its
103.16work.
103.17    Subd. 5. Report. The working group must submit a report by February 15, 2018, to the
103.18chairs and ranking minority members of the committees in the senate and house of
103.19representatives with primary jurisdiction over taxes, presenting two or more alternatives
103.20for reform of Minnesota's property tax system.
103.21    Subd. 6. Sunset. The working group shall sunset the day following the submission of
103.22the report under subdivision 5.
103.23EFFECTIVE DATE.This section is effective the day following final enactment.

103.24    Sec. 49. PROPOSALS FOR REFORM OF MINNESOTA'S PROPERTY TAX
103.25SYSTEM.
103.26The Legislative Property Tax Reform Working Group must develop proposals to
103.27restructure Minnesota's property tax system for legislative consideration. The proposals
103.28must provide for a system that reduces the complexity and cost of Minnesota's property tax
103.29system to increase transparency and understanding for taxpayers and assessors while
103.30minimizing the number of properties that experience severe tax changes. The proposals
103.31must include, but are not limited to, a reduction in the number of classifications and tiers
103.32in the current property tax system. The proposals may include a transition period of up to
104.1five years before the final system elements are fully operational. At least one proposal must
104.2be developed where the highest estimated net state cost does not exceed $250,000,000 in
104.3the first year that the proposal is fully phased in. At least one proposal must be developed
104.4where the highest estimated net state cost does not exceed $500,000,000 in the first year
104.5that the proposal is fully phased in. Each proposal should estimate the administrative cost
104.6savings to county governments and to the state government.
104.7EFFECTIVE DATE.This section is effective the day following final enactment.

104.8    Sec. 50. REPEALER.
104.9Minnesota Statutes 2016, sections 270C.9901; and 281.22, are repealed.
104.10EFFECTIVE DATE.This section is effective the day following final enactment.

104.11ARTICLE 3
104.12SALES AND USE TAXES

104.13    Section 1. [88.068] VOLUNTEER FIRE ASSISTANCE GRANT ACCOUNT.
104.14A volunteer fire assistance grant account is established in the special revenue fund. Sales
104.15taxes allocated under section 297A.94, for making grants under section 88.067, must be
104.16deposited in the special revenue fund and credited to the volunteer fire assistance grant
104.17account. Money in the account, including interest, is appropriated to the commissioner for
104.18making grants under that section.
104.19EFFECTIVE DATE.This section is effective beginning with deposits made in fiscal
104.20year 2018.

104.21    Sec. 2. Minnesota Statutes 2016, section 128C.24, is amended to read:
104.22128C.24 LEAGUE FUNDS TRANSFER.
104.23Beginning July 1, 2007, the Minnesota State High School League shall annually determine
104.24the sales tax savings attributable to section 297A.70, subdivision 11 11a, and annually
104.25transfer that amount to a nonprofit charitable foundation created for the purpose of promoting
104.26high school extracurricular activities. The funds must be used by the foundation to make
104.27grants to fund, assist, recognize, or promote high school students' participation in
104.28extracurricular activities. The first priority for funding will be grants for scholarships to
104.29individuals to offset athletic fees. The foundation must equitably award grants based on
104.30considerations of gender balance, school size, and geographic location, to the extent feasible.
105.1EFFECTIVE DATE.This section is effective for sales and purchases made after June
105.230, 2017.

105.3    Sec. 3. Minnesota Statutes 2016, section 297A.66, subdivision 1, is amended to read:
105.4    Subdivision 1. Definitions. (a) To the extent allowed by the United States Constitution
105.5and the laws of the United States, "retailer maintaining a place of business in this state," or
105.6a similar term, means a retailer:
105.7(1) having or maintaining within this state, directly or by a subsidiary or an affiliate, an
105.8office, place of distribution, sales, storage, or sample room or place, warehouse, or other
105.9place of business, including the employment of a resident of this state who works from a
105.10home office in this state; or
105.11(2) having a representative, including, but not limited to, an affiliate, agent, salesperson,
105.12canvasser, or marketplace provider, solicitor, or other third party operating in this state
105.13under the authority of the retailer or its subsidiary, for any purpose, including the repairing,
105.14selling, delivering, installing, facilitating sales, processing sales, or soliciting of orders for
105.15the retailer's goods or services, or the leasing of tangible personal property located in this
105.16state, whether the place of business or agent, representative, affiliate, salesperson, canvasser,
105.17or solicitor is located in the state permanently or temporarily, or whether or not the retailer,
105.18subsidiary, or affiliate is authorized to do business in this state. A retailer is represented by
105.19a marketplace provider in this state if the retailer makes sales in this state facilitated by a
105.20marketplace provider that maintains a place of business in this state.
105.21(b) "Destination of a sale" means the location to which the retailer makes delivery of
105.22the property sold, or causes the property to be delivered, to the purchaser of the property,
105.23or to the agent or designee of the purchaser. The delivery may be made by any means,
105.24including the United States Postal Service or a for-hire carrier.
105.25(c) "Marketplace provider" means any person who facilitates a retail sale by a retailer
105.26by:
105.27(1) listing or advertising for sale by the retailer in any forum, tangible personal property,
105.28services, or digital goods that are subject to tax under this chapter; and
105.29(2) either directly or indirectly through agreements or arrangements with third parties
105.30collecting payment from the customer and transmitting that payment to the retailer regardless
105.31of whether the marketplace provider receives compensation or other consideration in
105.32exchange for its services.
106.1(d) "Total taxable retail sales" means the gross receipts from the sale of all tangible
106.2goods, services, and digital goods subject to sales and use tax under this chapter.

106.3    Sec. 4. Minnesota Statutes 2016, section 297A.66, subdivision 2, is amended to read:
106.4    Subd. 2. Retailer maintaining place of business in this state. (a) Except as provided
106.5in paragraph (b), a retailer maintaining a place of business in this state who makes retail
106.6sales in Minnesota or to a destination in Minnesota shall collect sales and use taxes and
106.7remit them to the commissioner under section 297A.77.
106.8(b) A retailer with total taxable retail sales to customers in this state of less than $10,000
106.9in the 12-month period ending on the last day of the most recently completed calendar
106.10quarter is not required to collect and remit sales tax if it is determined to be a retailer
106.11maintaining a place of business in the state solely because it made sales through one or more
106.12marketplace providers. The provisions of this paragraph do not apply to a retailer that is or
106.13was registered to collect sales and use tax in this state.

106.14    Sec. 5. Minnesota Statutes 2016, section 297A.66, subdivision 4, is amended to read:
106.15    Subd. 4. Affiliated entities. (a) An entity is an "affiliate" of the retailer for purposes of
106.16subdivision 1, paragraph (a), if the entity:
106.17(1) the entity uses its facilities or employees in this state to advertise, promote, or facilitate
106.18the establishment or maintenance of a market for sales of items by the retailer to purchasers
106.19in this state or for the provision of services to the retailer's purchasers in this state, such as
106.20accepting returns of purchases for the retailer, providing assistance in resolving customer
106.21complaints of the retailer, or providing other services; and
106.22(2) the retailer and the entity are related parties. has the same or a similar business name
106.23to the retailer and sells, from a location or locations in this state, tangible personal property,
106.24digital goods, or services, taxable under this chapter, that are similar to that sold by the
106.25retailer;
106.26(3) maintains an office, distribution facility, salesroom, warehouse, storage place, or
106.27other similar place of business in this state to facilitate the delivery of tangible personal
106.28property, digital goods, or services sold by the retailer to its customers in this state;
106.29(4) maintains a place of business in this state and uses trademarks, service marks, or
106.30trade names in this state that are the same or substantially similar to those used by the retailer,
106.31and that use is done with the express or implied consent of the holder of the marks or names;
107.1(5) delivers, installs, or assembles tangible personal property in this state, or performs
107.2maintenance or repair services on tangible personal property in this state, for tangible
107.3personal property sold by the retailer;
107.4(6) facilitates the delivery of tangible personal property to customers of the retailer by
107.5allowing the customers to pick up tangible personal property sold by the retailer at a place
107.6of business the entity maintains in this state; or
107.7(7) shares management, business systems, business practices, or employees with the
107.8retailer, or engages in intercompany transactions with the retailer related to the activities
107.9that establish or maintain the market in this state of the retailer.
107.10(b) Two entities are related parties under this section if one of the entities meets at least
107.11one of the following tests with respect to the other entity:
107.12(1) one or both entities is a corporation, and one entity and any party related to that entity
107.13in a manner that would require an attribution of stock from the corporation to the party or
107.14from the party to the corporation under the attribution rules of section 318 of the Internal
107.15Revenue Code owns directly, indirectly, beneficially, or constructively at least 50 percent
107.16of the value of the corporation's outstanding stock;
107.17(2) one or both entities is a partnership, estate, or trust and any partner or beneficiary,
107.18and the partnership, estate, or trust and its partners or beneficiaries own directly, indirectly,
107.19beneficially, or constructively, in the aggregate, at least 50 percent of the profits, capital,
107.20stock, or value of the other entity or both entities; or
107.21(3) an individual stockholder and the members of the stockholder's family (as defined
107.22in section 318 of the Internal Revenue Code) owns directly, indirectly, beneficially, or
107.23constructively, in the aggregate, at least 50 percent of the value of both entities' outstanding
107.24stock.;
107.25(4) the entities are related within the meaning of subsections (b) and (c) of section 267
107.26or 707(b)(1) of the Internal Revenue Code; or
107.27(5) the entities have one or more ownership relationships and the relationships were
107.28designed with a principal purpose of avoiding the application of this section.
107.29(c) An entity is an affiliate under the provisions of this subdivision if the requirements
107.30of paragraphs (a) and (b) are met during any part of the 12-month period ending on the first
107.31day of the month before the month in which the sale was made.

108.1    Sec. 6. Minnesota Statutes 2016, section 297A.66, is amended by adding a subdivision to
108.2read:
108.3    Subd. 4b. Collection and remittance requirements for marketplace providers and
108.4marketplace retailers. (a) A marketplace provider shall collect sales and use taxes and
108.5remit them to the commissioner under section 297A.77 for all facilitated sales for a retailer,
108.6and is subject to audit on the retail sales it facilitates unless either:
108.7(1) the retailer provides a copy of the retailer's registration to collect sales and use tax
108.8in this state to the marketplace provider before the marketplace provider facilitates a sale;
108.9or
108.10(2) upon inquiry by the marketplace provider or its agent, the commissioner discloses
108.11that the retailer is registered to collect sales and use taxes in this state.
108.12(b) Nothing in this subdivision shall be construed to interfere with the ability of a
108.13marketplace provider and a retailer to enter into an agreement regarding fulfillment of the
108.14requirements of this chapter.
108.15(c) A marketplace provider is not liable under this subdivision for failure to file and
108.16collect and remit sales and use taxes if the marketplace provider demonstrates that the error
108.17was due to incorrect or insufficient information given to the marketplace provider by the
108.18retailer. This paragraph does not apply if the marketplace provider and the marketplace
108.19retailer are related as defined in subdivision 4, paragraph (b).

108.20    Sec. 7. Minnesota Statutes 2016, section 297A.67, subdivision 13a, is amended to read:
108.21    Subd. 13a. Instructional materials. (a) Instructional materials, other than textbooks,
108.22that are prescribed for use in conjunction with a course of study in a postsecondary school,
108.23college, university, or private career school to students who are regularly enrolled at such
108.24institutions are exempt. For purposes of this subdivision, "instructional materials" means
108.25materials required to be used directly in the completion of the course of study, including,
108.26but not limited to,:
108.27(1) interactive CDs, tapes, digital audio works, digital audiovisual works, and computer
108.28software.;
108.29(2) charts and models used in the course of study; and
108.30(3) specialty pens, pencils, inks, paint, paper, and other art supplies for art classes.
108.31(b) Notwithstanding paragraph (c), if the course of study is necessary to obtaining a
108.32degree or certification for a trade or career, any equipment, tools, and supplies required
109.1during the course of study that are generally used directly in the practice of the career or
109.2trade are also exempt.
109.3(c) Instructional materials do not include general reference works or other items incidental
109.4to the instructional process such as pens, pencils, paper, folders, or computers that are of
109.5general use outside of the course of study.
109.6(d) For purposes of this subdivision, "school" and "private career school" have the
109.7meanings given in subdivision 13.
109.8EFFECTIVE DATE.This section is effective for sales and purchases made after June
109.930, 2017.

109.10    Sec. 8. Minnesota Statutes 2016, section 297A.67, is amended by adding a subdivision to
109.11read:
109.12    Subd. 34. Certain herbicides. Purchases of herbicides authorized for use pursuant to
109.13an invasive aquatic plant management permit as defined under section 103G.615 are exempt
109.14if purchased by a lakeshore property owner, an association of lakeshore property owners
109.15organized under chapter 317A, or by a contractor hired by a lakeshore owner or association
109.16to provide invasive aquatic plant management under the permit. For purposes of this
109.17subdivision, "herbicides" means all herbicides that meet the following requirements:
109.18(1) are labeled for use in water;
109.19(2) are registered for use in this state by the Minnesota Department of Agriculture under
109.20section 18B.26; and
109.21(3) are listed as one of the herbicides proposed for use on the invasive aquatic plant
109.22management permit.
109.23EFFECTIVE DATE.This section is effective for sales and purchases made after June
109.2430, 2017.

109.25    Sec. 9. Minnesota Statutes 2016, section 297A.68, subdivision 5, is amended to read:
109.26    Subd. 5. Capital equipment. (a) Capital equipment is exempt.
109.27"Capital equipment" means machinery and equipment purchased or leased, and used in
109.28this state by the purchaser or lessee primarily for manufacturing, fabricating, mining, or
109.29refining tangible personal property to be sold ultimately at retail if the machinery and
109.30equipment are essential to the integrated production process of manufacturing, fabricating,
109.31mining, or refining. Capital equipment also includes machinery and equipment used primarily
110.1to electronically transmit results retrieved by a customer of an online computerized data
110.2retrieval system.
110.3(b) Capital equipment includes, but is not limited to:
110.4(1) machinery and equipment used to operate, control, or regulate the production
110.5equipment;
110.6(2) machinery and equipment used for research and development, design, quality control,
110.7and testing activities;
110.8(3) environmental control devices that are used to maintain conditions such as
110.9temperature, humidity, light, or air pressure when those conditions are essential to and are
110.10part of the production process;
110.11(4) materials and supplies used to construct and install machinery or equipment;
110.12(5) repair and replacement parts, including accessories, whether purchased as spare parts,
110.13repair parts, or as upgrades or modifications to machinery or equipment;
110.14(6) materials used for foundations that support machinery or equipment;
110.15(7) materials used to construct and install special purpose buildings used in the production
110.16process;
110.17(8) ready-mixed concrete equipment in which the ready-mixed concrete is mixed as part
110.18of the delivery process regardless if mounted on a chassis, repair parts for ready-mixed
110.19concrete trucks, and leases of ready-mixed concrete trucks; and
110.20(9) machinery or equipment used for research, development, design, or production of
110.21computer software.
110.22(c) Capital equipment does not include the following:
110.23(1) motor vehicles taxed under chapter 297B;
110.24(2) machinery or equipment used to receive or store raw materials;
110.25(3) building materials, except for materials included in paragraph (b), clauses (6) and
110.26(7);
110.27(4) machinery or equipment used for nonproduction purposes, including, but not limited
110.28to, the following: plant security, fire prevention, first aid, and hospital stations; support
110.29operations or administration; pollution control; and plant cleaning, disposal of scrap and
110.30waste, plant communications, space heating, cooling, lighting, or safety;
111.1(5) farm machinery and aquaculture production equipment as defined by section 297A.61,
111.2subdivisions 12 and 13;
111.3(6) machinery or equipment purchased and installed by a contractor as part of an
111.4improvement to real property;
111.5(7) machinery and equipment used by restaurants in the furnishing, preparing, or serving
111.6of prepared foods as defined in section 297A.61, subdivision 31;
111.7(8) machinery and equipment used to furnish the services listed in section 297A.61,
111.8subdivision 3
, paragraph (g), clause (6), items (i) to (vi) and (viii);
111.9(9) machinery or equipment used in the transportation, transmission, or distribution of
111.10petroleum, liquefied gas, natural gas, water, or steam, in, by, or through pipes, lines, tanks,
111.11mains, or other means of transporting those products. This clause does not apply to machinery
111.12or equipment used to blend petroleum or biodiesel fuel as defined in section 239.77; or
111.13(10) any other item that is not essential to the integrated process of manufacturing,
111.14fabricating, mining, or refining.
111.15(d) For purposes of this subdivision:
111.16(1) "Equipment" means independent devices or tools separate from machinery but
111.17essential to an integrated production process, including computers and computer software,
111.18used in operating, controlling, or regulating machinery and equipment; and any subunit or
111.19assembly comprising a component of any machinery or accessory or attachment parts of
111.20machinery, such as tools, dies, jigs, patterns, and molds.
111.21(2) "Fabricating" means to make, build, create, produce, or assemble components or
111.22property to work in a new or different manner.
111.23(3) "Integrated production process" means a process or series of operations through
111.24which tangible personal property is manufactured, fabricated, mined, or refined. For purposes
111.25of this clause, (i) manufacturing begins with the removal of raw materials from inventory
111.26and ends when the last process prior to loading for shipment has been completed; (ii)
111.27fabricating begins with the removal from storage or inventory of the property to be assembled,
111.28processed, altered, or modified and ends with the creation or production of the new or
111.29changed product; (iii) mining begins with the removal of overburden from the site of the
111.30ores, minerals, stone, peat deposit, or surface materials and ends when the last process before
111.31stockpiling is completed; and (iv) refining begins with the removal from inventory or storage
111.32of a natural resource and ends with the conversion of the item to its completed form.
112.1(4) "Machinery" means mechanical, electronic, or electrical devices, including computers
112.2and computer software, that are purchased or constructed to be used for the activities set
112.3forth in paragraph (a), beginning with the removal of raw materials from inventory through
112.4completion of the product, including packaging of the product.
112.5(5) "Machinery and equipment used for pollution control" means machinery and
112.6equipment used solely to eliminate, prevent, or reduce pollution resulting from an activity
112.7described in paragraph (a).
112.8(6) "Manufacturing" means an operation or series of operations where raw materials are
112.9changed in form, composition, or condition by machinery and equipment and which results
112.10in the production of a new article of tangible personal property. For purposes of this
112.11subdivision, "manufacturing" includes the generation of electricity or steam to be sold at
112.12retail.
112.13(7) "Mining" means the extraction of minerals, ores, stone, or peat.
112.14(8) "Online data retrieval system" means a system whose cumulation of information is
112.15equally available and accessible to all its customers.
112.16(9) "Primarily" means machinery and equipment used 50 percent or more of the time in
112.17an activity described in paragraph (a).
112.18(10) "Refining" means the process of converting a natural resource to an intermediate
112.19or finished product, including the treatment of water to be sold at retail.
112.20(11) This subdivision does not apply to telecommunications equipment as provided in
112.21subdivision 35a, and does not apply to wire, cable, fiber, poles, or conduit for
112.22telecommunications services.
112.23EFFECTIVE DATE.This section is effective for sales and purchases made after June
112.2430, 2017.

112.25    Sec. 10. Minnesota Statutes 2016, section 297A.68, subdivision 9, is amended to read:
112.26    Subd. 9. Super Bowl admissions and related events. (a) The granting of the privilege
112.27of admission to a world championship football game sponsored by the National Football
112.28League is and to related events sponsored by the National Football League or its affiliates,
112.29or the Minnesota Super Bowl Host Committee, are exempt.
112.30(b) The sale of nonresidential parking by the National Football League for attendance
112.31at a world championship football game sponsored by the National Football League and for
112.32related events sponsored by the National Football League or its affiliates, or the Minnesota
113.1Super Bowl Host Committee, is exempt. Purchases of nonresidential parking services by
113.2the Super Bowl Host Committee are purchases made exempt for resale.
113.3(c) For the purposes of this subdivision:
113.4(1) "related events sponsored by the National Football League or its affiliates" includes
113.5but is not limited to preparatory advance visits, NFL Experience, NFL Tailgate, NFL On
113.6Location, and NFL House; and
113.7(2) "affiliates" does not include National Football League teams.
113.8EFFECTIVE DATE.The amendments to this section are effective for sales and
113.9purchases made after June 30, 2016, and before March 1, 2018.

113.10    Sec. 11. Minnesota Statutes 2016, section 297A.68, subdivision 35a, is amended to read:
113.11    Subd. 35a. Telecommunications or pay television services machinery and equipment.
113.12(a) Telecommunications or pay television services machinery and equipment purchased or
113.13leased for use directly by a telecommunications or pay television services provider primarily
113.14in the provision of telecommunications or pay television services that are ultimately to be
113.15sold at retail are exempt, regardless of whether purchased by the owner, a contractor, or a
113.16subcontractor.
113.17(b) For purposes of this subdivision, "telecommunications or pay television machinery
113.18and equipment" includes, but is not limited to:
113.19(1) machinery, equipment, and fixtures utilized in receiving, initiating, amplifying,
113.20processing, transmitting, retransmitting, recording, switching, or monitoring
113.21telecommunications or pay television services, such as computers, transformers, amplifiers,
113.22routers, bridges, repeaters, multiplexers, and other items performing comparable functions;
113.23(2) machinery, equipment, and fixtures used in the transportation of telecommunications
113.24or pay television services, such as radio transmitters and receivers, satellite equipment,
113.25microwave equipment, and other transporting media, but not including wire, cable, fiber,
113.26poles, or conduit;
113.27(3) ancillary machinery, equipment, and fixtures that regulate, control, protect, or enable
113.28the machinery in clauses (1) and (2) to accomplish its intended function, such as auxiliary
113.29power supply, test equipment, towers, heating, ventilating, and air conditioning equipment
113.30necessary to the operation of the telecommunications or pay television equipment; and
113.31software necessary to the operation of the telecommunications or pay television equipment;
113.32and
114.1(4) repair and replacement parts, including accessories, whether purchased as spare parts,
114.2repair parts, or as upgrades or modifications to qualified machinery or equipment.
114.3EFFECTIVE DATE.This section is effective for sales and purchases made after June
114.430, 2017.

114.5    Sec. 12. Minnesota Statutes 2016, section 297A.70, subdivision 4, is amended to read:
114.6    Subd. 4. Sales to nonprofit groups. (a) All sales, except those listed in paragraph (b),
114.7to the following "nonprofit organizations" are exempt:
114.8(1) a corporation, society, association, foundation, or institution organized and operated
114.9exclusively for charitable, religious, or educational purposes if the item purchased is used
114.10in the performance of charitable, religious, or educational functions; and
114.11(2) any senior citizen group or association of groups that:
114.12(i) in general limits membership to persons who are either age 55 or older, or physically
114.13disabled;
114.14(ii) is organized and operated exclusively for pleasure, recreation, and other nonprofit
114.15purposes, not including housing, no part of the net earnings of which inures to the benefit
114.16of any private shareholders; and
114.17(iii) is an exempt organization under section 501(c) of the Internal Revenue Code.; and
114.18(3) an organization that qualifies for an exemption for memberships under subdivision
114.1912 if the item is purchased and used in the performance of the organization's mission.
114.20For purposes of this subdivision, charitable purpose includes the maintenance of a cemetery
114.21owned by a religious organization.
114.22(b) This exemption does not apply to the following sales:
114.23(1) building, construction, or reconstruction materials purchased by a contractor or a
114.24subcontractor as a part of a lump-sum contract or similar type of contract with a guaranteed
114.25maximum price covering both labor and materials for use in the construction, alteration, or
114.26repair of a building or facility;
114.27(2) construction materials purchased by tax-exempt entities or their contractors to be
114.28used in constructing buildings or facilities that will not be used principally by the tax-exempt
114.29entities;
114.30(3) lodging as defined under section 297A.61, subdivision 3, paragraph (g), clause (2),
114.31and prepared food, candy, soft drinks, and alcoholic beverages as defined in section 297A.67,
115.1subdivision 2
, except wine purchased by an established religious organization for sacramental
115.2purposes or as allowed under subdivision 9a; and
115.3(4) leasing of a motor vehicle as defined in section 297B.01, subdivision 11, except as
115.4provided in paragraph (c).
115.5(c) This exemption applies to the leasing of a motor vehicle as defined in section 297B.01,
115.6subdivision 11
, only if the vehicle is:
115.7(1) a truck, as defined in section 168.002, a bus, as defined in section 168.002, or a
115.8passenger automobile, as defined in section 168.002, if the automobile is designed and used
115.9for carrying more than nine persons including the driver; and
115.10(2) intended to be used primarily to transport tangible personal property or individuals,
115.11other than employees, to whom the organization provides service in performing its charitable,
115.12religious, or educational purpose.
115.13(d) A limited liability company also qualifies for exemption under this subdivision if
115.14(1) it consists of a sole member that would qualify for the exemption, and (2) the items
115.15purchased qualify for the exemption.
115.16EFFECTIVE DATE. This section is effective for sales and purchases made after June
115.1730, 2017.

115.18    Sec. 13. Minnesota Statutes 2016, section 297A.70, is amended by adding a subdivision
115.19to read:
115.20    Subd. 11a. Minnesota State High School League tickets and admissions. Tickets and
115.21admissions to games, events, and activities sponsored by the Minnesota State High School
115.22League under chapter 128C are exempt.
115.23EFFECTIVE DATE.This section is effective for sales and purchases made after June
115.2430, 2017.

115.25    Sec. 14. Minnesota Statutes 2016, section 297A.70, subdivision 12, is amended to read:
115.26    Subd. 12. YMCA, YWCA, and JCC, and similar memberships. (a) The sale of
115.27memberships, meaning both onetime initiation fees and periodic membership dues, to an
115.28association incorporated under section 315.44 or an organization defined under section
115.29315.51 , or a nonprofit organization offering similar services are exempt. However, all
115.30separate charges made for the privilege of having access to and the use of the association's
115.31sports and athletic facilities are taxable.
116.1(b) For purposes of this subdivision, a "nonprofit organization offering similar services"
116.2means an organization described in section 501(c)(3) of the Internal Revenue Code, whose
116.3mission is to support youth and families through a variety of activities, including membership
116.4allowing access to athletic facilities, and who provide free or reduced-price memberships
116.5to seniors or low-income persons or families.
116.6EFFECTIVE DATE.This section is effective for sales and purchases made after June
116.730, 2017.

116.8    Sec. 15. Minnesota Statutes 2016, section 297A.70, subdivision 14, is amended to read:
116.9    Subd. 14. Fund-raising events sponsored by nonprofit groups. (a) Sales of tangible
116.10personal property or services at, and admission charges for fund-raising events sponsored
116.11by, a nonprofit organization are exempt if:
116.12(1) all gross receipts are recorded as such, in accordance with generally accepted
116.13accounting practices, on the books of the nonprofit organization; and
116.14(2) the entire proceeds, less the necessary expenses for the event, will be used solely
116.15and exclusively for charitable, religious, or educational purposes. Exempt sales include the
116.16sale of prepared food, candy, and soft drinks at the fund-raising event.
116.17(b) This exemption is limited in the following manner:
116.18(1) it does not apply to admission charges for events involving bingo or other gambling
116.19activities or to charges for use of amusement devices involving bingo or other gambling
116.20activities;
116.21(2) all gross receipts are taxable if the profits are not used solely and exclusively for
116.22charitable, religious, or educational purposes;
116.23(3) it does not apply unless the organization keeps a separate accounting record, including
116.24receipts and disbursements from each fund-raising event that documents all deductions from
116.25gross receipts with receipts and other records;
116.26(4) it does not apply to any sale made by or in the name of a nonprofit corporation as
116.27the active or passive agent of a person that is not a nonprofit corporation;
116.28(5) all gross receipts are taxable if fund-raising events exceed 24 days per year;
116.29(6) it does not apply to fund-raising events conducted on premises leased for more than
116.30five ten days but less than 30 days; and
117.1(7) it does not apply if the risk of the event is not borne by the nonprofit organization
117.2and the benefit to the nonprofit organization is less than the total amount of the state and
117.3local tax revenues forgone by this exemption.
117.4(c) For purposes of this subdivision, a "nonprofit organization" means any unit of
117.5government, corporation, society, association, foundation, or institution organized and
117.6operated for charitable, religious, educational, civic, fraternal, and senior citizens' or veterans'
117.7purposes, no part of the net earnings of which inures to the benefit of a private individual.
117.8(d) For purposes of this subdivision, "fund-raising events" means activities of limited
117.9duration, not regularly carried out in the normal course of business, that attract patrons for
117.10community, social, and entertainment purposes, such as auctions, bake sales, ice cream
117.11socials, block parties, carnivals, competitions, concerts, concession stands, craft sales,
117.12bazaars, dinners, dances, door-to-door sales of merchandise, fairs, fashion shows, festivals,
117.13galas, special event workshops, sporting activities such as marathons and tournaments, and
117.14similar events. Fund-raising events do not include the operation of a regular place of business
117.15in which services are provided or sales are made during regular hours such as bookstores,
117.16thrift stores, gift shops, restaurants, ongoing Internet sales, regularly scheduled classes, or
117.17other activities carried out in the normal course of business.
117.18EFFECTIVE DATE.This section is effective for sales and purchases made after June
117.1930, 2017.

117.20    Sec. 16. Minnesota Statutes 2016, section 297A.70, is amended by adding a subdivision
117.21to read:
117.22    Subd. 20. City celebrations. (a) Sales of tangible personal property or services and
117.23admissions charges to a city-designated annual city celebration designed to promote
117.24community spirit and cooperation are exempt. Exempt sales include the sale of prepared
117.25food, candy, soft drinks, malt liquor and wine as defined in section 340A.101, subdivisions
117.2616, 19, and 27, at the event. The governing board of a statutory or home rule charter city
117.27with a population of less than 30,000 may designate one event in each calendar year as the
117.28annual city celebration that qualifies for the exemption under this subdivision. For a
117.29celebration to qualify, it must meet the following requirements:
117.30(1) the event must be held on consecutive days, not to exceed ten days in total;
117.31(2) the event must be run either by the city or by a nonprofit organization designated by
117.32the city;
118.1(3) all gross receipts of the event are recorded as such, in accordance with generally
118.2accepted accounting practice on the books of the city or the designated nonprofit organization;
118.3and
118.4(4) the entire proceeds, less the necessary expenses, will be distributed to one or more
118.5of the following for charitable, educational, civic, or governmental purposes:
118.6(i) the city's general fund;
118.7(ii) a nonprofit 501(c)(3) organization to promote its primary mission; or
118.8(iii) a nonprofit 501(c)(4) organization to promote its primary mission, however, no
118.9revenues from this event may be used by the organization for lobbying or political activities.
118.10(b) This exemption is limited in the following manner:
118.11(1) it does not apply to admission charges for events involving bingo or other gambling
118.12activities or to charges for use of amusement devices involving bingo or other gambling
118.13activities;
118.14(2) all gross receipts are taxable if the profits are not used solely and exclusively for
118.15charitable, educational, civic, or governmental purposes; and
118.16(3) it does not apply unless the city or designated nonprofit organization keeps a separate
118.17accounting record, including receipts and disbursements for all events included in the
118.18celebration that documents all deductions from gross receipts with receipts and other records.
118.19(c) For purposes of this subdivision, "nonprofit organization" means any unit of
118.20government, corporation, society, association, foundation, or institution organized and
118.21operated for charitable, religious, educational, civic, fraternal, and senior citizens' or veterans'
118.22purposes, no part of the net earnings of which inures to the benefit of a private individual.
118.23(d) For purposes of this subdivision, "city celebration" means any of the following
118.24activities or combination of activities of limited duration, not regularly carried out in the
118.25normal course of business, that attract patrons for community, social, and entertainment
118.26purposes, such as parades, auctions, bake sales, ice cream socials, block parties, carnivals,
118.27competitions, concerts, concession stands, craft sales, bazaars, dinners, dances, fairs, fashion
118.28shows, festivals, galas, special event workshops, sporting activities such as marathons and
118.29tournaments, and similar events. A city celebration does not include the operation of a
118.30regular place of business in which services are provided or sales are made during regular
118.31hours such as bookstores, thrift stores, gift shops, restaurants, ongoing Internet sales, or
118.32regularly scheduled activities carried out in the normal course of business.
119.1EFFECTIVE DATE.This section is effective for sales and purchases made after June
119.230, 2017.

119.3    Sec. 17. Minnesota Statutes 2016, section 297A.70, is amended by adding a subdivision
119.4to read:
119.5    Subd. 21. Ice arenas and rinks. Sales to organizations that exist primarily for the purpose
119.6of operating ice arenas or rinks that are part of the Duluth Heritage Sports Center and are
119.7used for youth and high school programs are exempt if the organization is a private, nonprofit
119.8corporation exempt from federal income taxation under section 501(c)(3) of the Internal
119.9Revenue Code.
119.10EFFECTIVE DATE.This section is effective for sales and purchases made after June
119.1130, 2017.

119.12    Sec. 18. Minnesota Statutes 2016, section 297A.71, subdivision 44, is amended to read:
119.13    Subd. 44. Building materials, capital projects. (a) Materials and supplies used or
119.14consumed in and equipment incorporated into the construction or improvement of a capital
119.15project funded partially or wholly under section 297A.9905 are exempt, provided that the
119.16project has a total construction cost of at least $40,000,000 within a 24-month period.
119.17(b) Materials and supplies used or consumed in and equipment incorporated into the
119.18construction, remodeling, expansion, or improvement of an ice arena or other buildings or
119.19facilities owned and operated by the city of Plymouth are exempt. For purposes of this
119.20paragraph, "facilities" include municipal streets and facilities associated with streets including
119.21but not limited to lighting, curbs and gutters, and sidewalks. The total amount of refund on
119.22all building materials, supplies, and equipment that the city may apply for under this
119.23paragraph is $2,500,000.
119.24(c) The tax on purchases exempt under this provision must be imposed and collected as
119.25if the rate under section 297A.62, subdivision 1, applied and then refunded in the manner
119.26provided in section 297A.75.
119.27EFFECTIVE DATE.This section is effective retroactively for sales and purchases
119.28made after January 1, 2013.

120.1    Sec. 19. Minnesota Statutes 2016, section 297A.71, is amended by adding a subdivision
120.2to read:
120.3    Subd. 49. Construction materials purchased by contractors; exemption for certain
120.4entities. (a) Building, construction, or reconstruction materials, supplies, and equipment
120.5purchased by a contractor, subcontractor, or builder and used or consumed in or incorporated
120.6into buildings or facilities used principally by the following entities are exempt:
120.7(1) school districts, as defined under section 297A.70, subdivision 2, paragraph (c);
120.8(2) local governments, as defined under section 297A.70, subdivision 2, paragraph (d);
120.9(3) hospitals and nursing homes owned and operated by political subdivisions of the
120.10state, as defined under section 297A.70, subdivision 2, paragraph (a), clause (3);
120.11(4) public libraries; library systems; multicounty, multitype library systems, as defined
120.12in section 134.001; and county law libraries under chapter 134A;
120.13(5) nonprofit groups, as defined under section 297A.70, subdivision 4;
120.14(6) hospitals, outpatient surgical centers, and critical access dental providers, as defined
120.15under section 297A.70, subdivision 7; and
120.16(7) nursing homes and boarding care homes, as defined under section 297A.70,
120.17subdivision 18.
120.18(b) Materials, supplies, and equipment used in the construction, reconstruction, repair,
120.19maintenance, or improvement of public infrastructure of any kind including, but not limited
120.20to, roads, bridges, culverts, drinking water facilities, and wastewater facilities purchased
120.21by a contractor or subcontractor of the following entities are exempt:
120.22(1) school districts, as defined under section 297A.70, subdivision 2, paragraph (c); or
120.23(2) local governments, as defined under section 297A.70, subdivision 2, paragraph (d).
120.24(c) The tax on purchases exempt under this subdivision must be imposed and collected
120.25as if the rate under section 297A.62, subdivision 1, applied, and then refunded in the manner
120.26provided in section 297A.75.
120.27EFFECTIVE DATE.This section is effective for sales and purchases made after June
120.2830, 2017.

121.1    Sec. 20. Minnesota Statutes 2016, section 297A.71, is amended by adding a subdivision
121.2to read:
121.3    Subd. 50. Properties destroyed by fire. Building materials and supplies used in, and
121.4equipment incorporated into, the construction or replacement of real property that is located
121.5in Madelia affected by the fire on February 3, 2016, are exempt. The tax must be imposed
121.6and collected as if the rate under section 297A.62, subdivision 1, applied and then refunded
121.7in the manner provided in section 297A.75.
121.8EFFECTIVE DATE.This section is effective retroactively for sales and purchases
121.9made after December 31, 2015, and before July 1, 2018.

121.10    Sec. 21. Minnesota Statutes 2016, section 297A.71, is amended by adding a subdivision
121.11to read:
121.12    Subd. 51. Properties destroyed by fire. (a) Building materials and supplies used in,
121.13and equipment incorporated into, the construction or replacement of real property that is
121.14located in Melrose affected by the fire on September 8, 2016, are exempt.
121.15(b) For sales and purchases made after September 30, 2016, and before April 1, 2017,
121.16the tax must be imposed and collected as if the rate under section 297A.62, subdivision 1,
121.17applied and then refunded in the manner provided in section 297A.75.
121.18EFFECTIVE DATE.This section is effective retroactively for sales and purchases
121.19made after September 30, 2016, and before January 1, 2019, except that the refund provisions
121.20of paragraph (b) are effective for sales and purchases made after September 30, 2016, and
121.21before April 1, 2017.

121.22    Sec. 22. Minnesota Statutes 2016, section 297A.71, is amended by adding a subdivision
121.23to read:
121.24    Subd. 52. Building materials; Major League Soccer stadium. Materials and supplies
121.25used or consumed in, and equipment incorporated into, the construction of a Major League
121.26Soccer stadium and related infrastructure constructed in the city of St. Paul are exempt.
121.27This subdivision expires one year after the date the first Major League Soccer game is played
121.28in the stadium.
121.29EFFECTIVE DATE.This section is effective for sales and purchases made after the
121.30day following final enactment.

122.1    Sec. 23. Minnesota Statutes 2016, section 297A.75, subdivision 1, is amended to read:
122.2    Subdivision 1. Tax collected. The tax on the gross receipts from the sale of the following
122.3exempt items must be imposed and collected as if the sale were taxable and the rate under
122.4section 297A.62, subdivision 1, applied. The exempt items include:
122.5    (1) building materials for an agricultural processing facility exempt under section
122.6297A.71, subdivision 13 ;
122.7    (2) building materials for mineral production facilities exempt under section 297A.71,
122.8subdivision 14
;
122.9    (3) building materials for correctional facilities under section 297A.71, subdivision 3;
122.10    (4) building materials used in a residence for disabled veterans exempt under section
122.11297A.71, subdivision 11 ;
122.12    (5) elevators and building materials exempt under section 297A.71, subdivision 12;
122.13    (6) materials and supplies for qualified low-income housing under section 297A.71,
122.14subdivision 23
;
122.15    (7) materials, supplies, and equipment for municipal electric utility facilities under
122.16section 297A.71, subdivision 35;
122.17    (8) equipment and materials used for the generation, transmission, and distribution of
122.18electrical energy and an aerial camera package exempt under section 297A.68, subdivision
122.1937;
122.20    (9) commuter rail vehicle and repair parts under section 297A.70, subdivision 3, paragraph
122.21(a), clause (10);
122.22    (10) materials, supplies, and equipment for construction or improvement of projects and
122.23facilities under section 297A.71, subdivision 40;
122.24(11) materials, supplies, and equipment for construction, improvement, or expansion
122.25of:
122.26(i) an aerospace defense manufacturing facility exempt under Minnesota Statutes 2014,
122.27section 297A.71, subdivision 42;
122.28(ii) a biopharmaceutical manufacturing facility exempt under section 297A.71, subdivision
122.2945
;
122.30(iii) a research and development facility exempt under Minnesota Statutes 2014, section
122.31297A.71, subdivision 46; and
123.1(iv) an industrial measurement manufacturing and controls facility exempt under
123.2Minnesota Statutes 2014, section 297A.71, subdivision 47;
123.3(12) enterprise information technology equipment and computer software for use in a
123.4qualified data center exempt under section 297A.68, subdivision 42;
123.5(13) materials, supplies, and equipment for qualifying capital projects under section
123.6297A.71, subdivision 44 ;
123.7(14) items purchased for use in providing critical access dental services exempt under
123.8section 297A.70, subdivision 7, paragraph (c); and
123.9(15) items and services purchased under a business subsidy agreement for use or
123.10consumption primarily in greater Minnesota exempt under section 297A.68, subdivision
123.1144
.;
123.12(16) building construction or reconstruction materials, supplies, and equipment purchased
123.13by an entity eligible under section 297A.71, subdivision 49;
123.14(17) building materials, equipment, and supplies for constructing or replacing real
123.15property exempt under section 297A.71, subdivision 50; and
123.16(18) building materials, equipment, and supplies for constructing or replacing real
123.17property exempt under section 297A.71, subdivision 51, paragraph (b).
123.18EFFECTIVE DATE.(a) The amendment adding clause (16) is effective for sales and
123.19purchases made after June 30, 2017.
123.20(b) The amendment adding clause (17) is effective retroactively for sales and purchases
123.21made after December 31, 2015.
123.22(c) The amendment adding clause (18) is effective retroactively for sales and purchases
123.23made after September 30, 2016.

123.24    Sec. 24. Minnesota Statutes 2016, section 297A.75, subdivision 2, is amended to read:
123.25    Subd. 2. Refund; eligible persons. Upon application on forms prescribed by the
123.26commissioner, a refund equal to the tax paid on the gross receipts of the exempt items must
123.27be paid to the applicant. Only the following persons may apply for the refund:
123.28    (1) for subdivision 1, clauses (1), (2), and (14), the applicant must be the purchaser;
123.29    (2) for subdivision 1, clause (3), the applicant must be the governmental subdivision;
123.30    (3) for subdivision 1, clause (4), the applicant must be the recipient of the benefits
123.31provided in United States Code, title 38, chapter 21;
124.1    (4) for subdivision 1, clause (5), the applicant must be the owner of the homestead
124.2property;
124.3    (5) for subdivision 1, clause (6), the owner of the qualified low-income housing project;
124.4    (6) for subdivision 1, clause (7), the applicant must be a municipal electric utility or a
124.5joint venture of municipal electric utilities;
124.6    (7) for subdivision 1, clauses (8), (11), (12), and (15), the owner of the qualifying
124.7business; and
124.8    (8) for subdivision 1, clauses (9), (10), and (13), the applicant must be the governmental
124.9entity that owns or contracts for the project or facility.;
124.10    (9) for subdivision 1, clause (16), the applicant must be the entity eligible under section
124.11297A.71, subdivision 49;
124.12    (10) for subdivision 1, clause (17), the applicant must be the owner or developer of the
124.13building or project; and
124.14    (11) for subdivision 1, clause (18), the applicant must be the owner or developer of the
124.15building or project.
124.16EFFECTIVE DATE.(a) The amendment adding clause (9) is effective for sales and
124.17purchases made after June 30, 2017.
124.18(b) The amendment adding clause (10) is effective retroactively for sales and purchases
124.19made after December 31, 2015.
124.20(c) The amendment adding clause (11) is effective retroactively for sales and purchases
124.21made after September 30, 2016.

124.22    Sec. 25. Minnesota Statutes 2016, section 297A.75, subdivision 3, is amended to read:
124.23    Subd. 3. Application. (a) The application must include sufficient information to permit
124.24the commissioner to verify the tax paid. If the tax was paid by a contractor, subcontractor,
124.25or builder, under subdivision 1, clauses (3) to (13), or (15), (16), (17), or (18), the contractor,
124.26subcontractor, or builder must furnish to the refund applicant a statement including the cost
124.27of the exempt items and the taxes paid on the items unless otherwise specifically provided
124.28by this subdivision. The provisions of sections 289A.40 and 289A.50 apply to refunds under
124.29this section.
124.30    (b) An applicant may not file more than two applications per calendar year for refunds
124.31for taxes paid on capital equipment exempt under section 297A.68, subdivision 5.
125.1EFFECTIVE DATE.This section is effective for sales and purchases made after June
125.230, 2017.

125.3    Sec. 26. Minnesota Statutes 2016, section 297A.75, subdivision 5, is amended to read:
125.4    Subd. 5. Appropriation. (a) The amount required to make the refunds is annually
125.5appropriated to the commissioner.
125.6(b) For fiscal years 2018 and 2019 only, revenues dedicated under the Minnesota
125.7Constitution, article XI, section 15, shall not be reduced for any portion of the refunds paid
125.8for the following exemptions:
125.9(1) the exemption under section 297A.71, subdivision 44, paragraph (b);
125.10(2) the expansion of the exemption under section 297A.68, subdivision 44, due to section
125.1130; and
125.12(3) the exemptions in section 297A.71, subdivisions 49, 50, and 51.
125.13EFFECTIVE DATE.This section is effective the day following final enactment.

125.14    Sec. 27. Minnesota Statutes 2016, section 297A.94, is amended to read:
125.15297A.94 DEPOSIT OF REVENUES.
125.16(a) Except as provided in this section, the commissioner shall deposit the revenues,
125.17including interest and penalties, derived from the taxes imposed by this chapter in the state
125.18treasury and credit them to the general fund.
125.19(b) The commissioner shall deposit taxes in the Minnesota agricultural and economic
125.20account in the special revenue fund if:
125.21(1) the taxes are derived from sales and use of property and services purchased for the
125.22construction and operation of an agricultural resource project; and
125.23(2) the purchase was made on or after the date on which a conditional commitment was
125.24made for a loan guaranty for the project under section 41A.04, subdivision 3.
125.25The commissioner of management and budget shall certify to the commissioner the date on
125.26which the project received the conditional commitment. The amount deposited in the loan
125.27guaranty account must be reduced by any refunds and by the costs incurred by the Department
125.28of Revenue to administer and enforce the assessment and collection of the taxes.
126.1(c) The commissioner shall deposit the revenues, including interest and penalties, derived
126.2from the taxes imposed on sales and purchases included in section 297A.61, subdivision 3,
126.3paragraph (g), clauses (1) and (4), in the state treasury, and credit them as follows:
126.4(1) first to the general obligation special tax bond debt service account in each fiscal
126.5year the amount required by section 16A.661, subdivision 3, paragraph (b); and
126.6(2) after the requirements of clause (1) have been met, the balance to the general fund.
126.7(d) The commissioner shall deposit the revenues, including interest and penalties,
126.8collected under section 297A.64, subdivision 5, in the state treasury and credit them to the
126.9general fund. By July 15 of each year the commissioner shall transfer to the highway user
126.10tax distribution fund an amount equal to the excess fees collected under section 297A.64,
126.11subdivision 5
, for the previous calendar year.
126.12(e) 72.43 percent of the revenues, including interest and penalties, transmitted to the
126.13commissioner under section 297A.65, must be deposited by the commissioner in the state
126.14treasury as follows:
126.15(1) 50 percent of the receipts must be deposited in the heritage enhancement account in
126.16the game and fish fund, and may be spent only on activities that improve, enhance, or protect
126.17fish and wildlife resources, including conservation, restoration, and enhancement of land,
126.18water, and other natural resources of the state;
126.19(2) 22.5 percent of the receipts must be deposited in the natural resources fund, and may
126.20be spent only for state parks and trails;
126.21(3) 22.5 percent of the receipts must be deposited in the natural resources fund, and may
126.22be spent only on metropolitan park and trail grants;
126.23(4) three percent of the receipts must be deposited in the natural resources fund, and
126.24may be spent only on local trail grants; and
126.25(5) two percent of the receipts must be deposited in the natural resources fund, and may
126.26be spent only for the Minnesota Zoological Garden, the Como Park Zoo and Conservatory,
126.27and the Duluth Zoo.
126.28(f) The revenue dedicated under paragraph (e) may not be used as a substitute for
126.29traditional sources of funding for the purposes specified, but the dedicated revenue shall
126.30supplement traditional sources of funding for those purposes. Land acquired with money
126.31deposited in the game and fish fund under paragraph (e) must be open to public hunting
126.32and fishing during the open season, except that in aquatic management areas or on lands
126.33where angling easements have been acquired, fishing may be prohibited during certain times
127.1of the year and hunting may be prohibited. At least 87 percent of the money deposited in
127.2the game and fish fund for improvement, enhancement, or protection of fish and wildlife
127.3resources under paragraph (e) must be allocated for field operations.
127.4(g) The commissioner must deposit the revenues, including interest and penalties minus
127.5any refunds, derived from the sale of items regulated under section 624.20, subdivision 1,
127.6that may be sold to persons 18 years old or older and that are not prohibited from use by
127.7the general public under section 624.21, in the state treasury and credit:
127.8(1) 25 percent to the volunteer fire assistance grant account established under section
127.988.068;
127.10(2) 25 percent to the fire safety account established under section 297I.06, subdivision
127.113; and
127.12(3) the remainder to the general fund.
127.13For purposes of this paragraph, the percentage of total sales and use tax revenue derived
127.14from the sale of items regulated under section 624.20, subdivision 1, that are allowed to be
127.15sold to persons 18 years old or older and are not prohibited from use by the general public
127.16under section 624.21, is a set percentage of the total sales and use tax revenues collected in
127.17the state, with the percentage determined under section 28.
127.18(g) (h) The revenues deposited under paragraphs (a) to (f) (g) do not include the revenues,
127.19including interest and penalties, generated by the sales tax imposed under section 297A.62,
127.20subdivision 1a
, which must be deposited as provided under the Minnesota Constitution,
127.21article XI, section 15.
127.22EFFECTIVE DATE.This section is effective for sales and purchases made after
127.23December 31, 2017.

127.24    Sec. 28. CALCULATION OF THE PERCENT OF SALES TAX REVENUE
127.25ATTRIBUTABLE TO THE SALE OF CERTAIN FIREWORKS-RELATED ITEMS.
127.26By December 1, 2017, the commissioner of revenue must estimate the percentage of
127.27total sales tax revenues collected in calendar year 2016 that is attributable to the sales and
127.28purchases of items regulated under Minnesota Statutes, section 624.20, subdivision 1, that
127.29are allowed to be sold to persons 18 years old or older and that are not prohibited from use
127.30by the general public under section 624.21. When making the determination, the
127.31commissioner may consult with representatives from producers and retailers, industry trade
127.32groups, and the most recently available national and state information. The commissioner's
128.1decision is final. The commissioner's determination under this section is not a rule and is
128.2not subject to Minnesota Statutes, chapter 14, including section 14.386.
128.3EFFECTIVE DATE.This section is effective the day following final enactment.

128.4    Sec. 29. SALES TAX EXEMPTION FOR CONSTRUCTION MATERIALS USED
128.5BY A NONPROFIT ECONOMIC DEVELOPMENT CORPORATION.
128.6    Subdivision 1. Exemption; refund. Materials and supplies used or consumed in and
128.7equipment incorporated into the construction of a retail development consisting of retail
128.8space for a grocery store, fueling center, or other retail space by a nonprofit economic
128.9development corporation that is a 501(c)(3) organization are exempt from sales and use tax
128.10under Minnesota Statutes, chapter 297A, provided that the development is located in a city
128.11with no grocery store and the city is at least 20 miles from another city with a grocery store.
128.12The exemption applies to materials, supplies, and equipment purchased after January 1,
128.132013, and before January 1, 2017. The tax must be imposed and collected as if the rate in
128.14Minnesota Statutes, section 297A.62, applied and the nonprofit economic development
128.15corporation must apply for the refund of the tax in the same manner as provided under
128.16Minnesota Statutes, section 297A.75, subdivision 1, clause (11).
128.17    Subd. 2. Appropriation. The amount required to pay the refunds under subdivision 1
128.18is appropriated from the general fund to the commissioner of revenue.
128.19EFFECTIVE DATE.This section is effective the day following final enactment and
128.20applies retroactively to sales and purchases made after January 1, 2013, and before January
128.211, 2017.

128.22    Sec. 30. EXEMPTION FROM JOB EXPANSION PROGRAM PROVISIONS.
128.23(a) Notwithstanding the seven-year certification period under Minnesota Statutes, section
128.24116J.8738, subdivision 3, the certification period for an eligible wholesale electronic
128.25component distribution center investing a minimum of $200,000,000 and constructing a
128.26facility at least 700,000 square feet in size is effective for the ten-year period beginning on
128.27the first day of the calendar month immediately following the date that the commissioner
128.28informs the business of the award of the benefit.
128.29(b) Notwithstanding the sales tax exemption limitations under Minnesota Statutes, section
128.30116J.8738, subdivision 4, the sales tax exemption for an eligible electronic component
128.31distribution center investing a minimum of $200,000,000 and constructing a facility at least
129.1700,000 square feet in size may be authorized up to $5,000,000 annually and up to
129.2$30,000,000 during the total period of the agreement.
129.3EFFECTIVE DATE.This section is effective July 1, 2017.

129.4    Sec. 31. CERTAIN REIMBURSEMENT AUTHORIZED; CONSIDERED
129.5OPERATING OR CAPITAL EXPENSES.
129.6    Subdivision 1. Reimbursement authorized. (a) An amount equivalent to the taxes paid
129.7under Minnesota Statutes, chapter 297A, and any local taxes administered by the Department
129.8of Revenue, on purchases of tangible personal property, nonresidential parking services,
129.9and lodging, as these terms are defined in Minnesota Statutes, chapter 297A, used and
129.10consumed in connection with Super Bowl LII or related events sponsored by the National
129.11Football League or its affiliates, will be reimbursed by the Minnesota Sports Facilities
129.12Authority up to $1,600,000, if made after June 30, 2016, and before March 1, 2018. Only
129.13purchases made by the Minnesota Super Bowl Host Committee, the National Football
129.14League or its affiliates, or their employees or independent contractors, qualify to be
129.15reimbursed under this section.
129.16(b) For purposes of this subdivision:
129.17(1) "employee or independent contractor" means only those employees or independent
129.18contractors that make qualifying purchases that are reimbursed by the Minnesota Super
129.19Bowl Host Committee or the National Football League or its affiliates; and
129.20(2) "related events sponsored by the National Football League or its affiliates" includes
129.21but is not limited to preparatory advance visits, NFL Experience, NFL Tailgate, NFL Honors,
129.22and NFL House.
129.23    Subd. 2. Operating reserve and capital reserve fund. Notwithstanding the requirements
129.24of Minnesota Statutes, section 473J.13, subdivisions 2 and 4, up to $1,600,000 of the balance
129.25in the operating reserve or capital reserve fund may be used for the purposes of paying
129.26reimbursements authorized under subdivision 1.
129.27EFFECTIVE DATE.This section is effective for sales and purchases made after June
129.2830, 2016, and before March 1, 2018.

129.29    Sec. 32. REIMBURSEMENTS TO CERTAIN CONSTITUTIONALLY DEDICATED
129.30FUNDS FOR EXPANDED SALES TAX EXEMPTIONS.
129.31The commissioner of management and budget, by June 15 in fiscal years 2018 and 2019
129.32only, shall increase the revenues transferred from the general fund as required under the
130.1Minnesota Constitution, article XI, section 15, an amount equal to the estimated amount of
130.2reduction to these revenues for that fiscal year due to the enactment of new sales tax
130.3exemptions or the expansion of existing sales tax exemptions under sections 7, 8, 10 to 17,
130.4and 22, and to changes in tobacco taxes under Minnesota Statutes, chapter 297F, in article
130.510. The commissioner of revenue shall make the estimate of this revenue reduction by June
130.61 of each fiscal year and inform the commissioner of management and budget. The
130.7appropriations under this section are onetime and not added to the base budget.
130.8EFFECTIVE DATE.This section is effective the day following final enactment.

130.9    Sec. 33. REPORT ON TAXATION OF STADIUM SUITES.
130.10The commissioner of revenue shall prepare a report on the sales and use tax treatment
130.11of the sale of suites and suite licenses in professional athletic facilities in other states. The
130.12report must be completed on or before February 1, 2018, and provided to the chairs and
130.13ranking minority members of the legislative committees with jurisdiction over taxes. The
130.14purpose of the report is to determine the range of sales and use tax treatment of these items
130.15across the country, and how Minnesota's current tax treatment of suites and suite licenses
130.16fits into that range.
130.17EFFECTIVE DATE.This section is effective the day following final enactment.

130.18    Sec. 34. SEVERABILITY.
130.19If any provision of sections 3 to 6 or the application thereof is held invalid, such invalidity
130.20shall not affect the provisions or applications of the sections that can be given effect without
130.21the invalid provisions or applications.
130.22EFFECTIVE DATE.This section is effective the day following final enactment.

130.23    Sec. 35. APPROPRIATION.
130.24$1,392,258 in fiscal year 2018 is appropriated from the general fund to the commissioner
130.25of revenue for a grant to the city of Melrose for the following purposes:
130.26(1) $450,000 for municipal street and utility reconstruction;
130.27(2) $250,000 for unreimbursed costs of hazardous materials removal; and
130.28(3) $692,258 for tax abatements for reconstructed buildings.
130.29The appropriation under this section is onetime and is not added to the base budget.
130.30EFFECTIVE DATE.This section is effective the day following final enactment.

131.1    Sec. 36. EFFECTIVE DATE.
131.2(a) The provisions of sections 3 to 6 are effective at the earlier of:
131.3(1) a decision by the United States Supreme Court modifying its decision in Quill Corp.
131.4v. North Dakota, 504 U.S. 298 (1992) so that a state may require retailers without a physical
131.5presence in the state to collect and remit sales tax; or
131.6(2) July 1, 2020.
131.7(b) Notwithstanding paragraph (a) or the provisions of sections 3 to 6, if a federal law
131.8is enacted authorizing a state to impose a requirement to collect and remit sales tax on
131.9retailers without a physical presence in the state, the commissioner must enforce the
131.10provisions of this section and sections 3 to 6 to the extent allowed under federal law.
131.11(c) The commissioner of revenue shall notify the revisor of statutes when either of the
131.12provisions in paragraph (a) or (b) apply.

131.13ARTICLE 4
131.14AIDS, CREDITS, AND REFUNDS

131.15    Section 1. [103F.485] RIPARIAN BUFFER COMPENSATION PROGRAM.
131.16    Subdivision 1. Definitions. (a) For purposes of this section, the following terms have
131.17the meanings given.
131.18(b) "Board" means the Board of Water and Soil Resources.
131.19(c) "Claimant" means:
131.20(1) a person, as defined in section 290.01, subdivision 2, who owns agricultural land in
131.21Minnesota and files an application under this section; or
131.22(2) a purchaser or grantee of property sold or transferred after the original application
131.23was submitted.
131.24(d) "Commissioner" means the commissioner of revenue.
131.25(e) "Program" means the riparian buffer compensation program established in this section.
131.26(f) "Public waters buffer" means a 50-foot average width, 30-foot minimum width
131.27continuous area consisting of perennially rooted vegetation, excluding invasive plants and
131.28noxious weeds, adjacent to public waters, as defined in section 103G.005, subdivision 15,
131.29that protects the water resources of the state from runoff pollution; stabilizes soils, shores,
131.30and banks; and protects or provides riparian corridors.
132.1    Subd. 2. Eligibility requirements. Land may be enrolled in the program if all of the
132.2following conditions are met:
132.3(1) the land is tillable land classified as 2a under section 273.13, subdivision 23;
132.4(2) a public waters buffer is required to be maintained on the property by the landowner
132.5pursuant to section 103F.48, subdivision 3, and the public waters buffer is identified and
132.6mapped on a buffer protection map established and maintained by the commissioner of
132.7natural resources;
132.8(3) the tillable land is converted to a public waters buffer during calendar years 2015
132.9through 2018 to comply with section 103F.48;
132.10(4) there are no delinquent property taxes on the land; and
132.11(5) an application is submitted to the commissioner as specified in subdivision 3 on or
132.12before April 1, 2019.
132.13    Subd. 3. Applications. (a) An owner of agricultural land in Minnesota may apply to
132.14enroll agricultural land in the program under this section. The application shall be on a form
132.15prescribed by the commissioner and must include the following information: (1) the
132.16landowner's Social Security number and date of birth, or state or federal business tax
132.17identification number, (2) the landowner's address, (3) the landowner's signature, (4) the
132.18county parcel identification numbers for the tax parcels that completely contain the
132.19agricultural land on which a public waters buffer is required to be established and maintained,
132.20(5) the number of acres of tillable class 2a agricultural land converted to a public waters
132.21buffer during calendar years 2015 through 2018 to comply with section 103F.48, rounded
132.22to the nearest whole acre, (6) the signature of an employee of the soil and water conservation
132.23district where the land is located, certifying the accuracy of the parcel identification numbers
132.24and the converted acres figure included in the application, and (7) any other information
132.25the commissioner deems necessary.
132.26(b) The commissioner shall review the application and determine if the property is
132.27eligible for enrollment in the program. The commissioner shall notify the claimant of the
132.28determination within 90 days of receipt of the completed application.
132.29(c) Social Security numbers collected from individuals under this section are private
132.30data as provided in section 13.355. The federal business tax identification number and date
132.31of birth data collected under this section are private data on individuals or nonpublic data,
132.32as defined in section 13.02, subdivisions 9 and 12, but may be shared with county treasurers
132.33for purposes of the revenue recapture under chapter 270A.
133.1    Subd. 4. Annual certification. On or before February 15, 2019, and each February 15
133.2thereafter, the commissioner shall send each claimant a certification form. The claimant
133.3must sign the certification, attesting that the requirements and conditions the commissioner
133.4deems necessary for continued enrollment in the program are currently being met, and must
133.5return the signed certification form to the commissioner by April 1 of the same year. If the
133.6claimant does not return the annual certification form by the due date, the commissioner
133.7must notify the claimant that the land will be terminated from the program if the certification
133.8is not received within 30 days.
133.9    Subd. 5. Notification to commissioner of noncompliance. On or before June 1, 2019,
133.10and each June 1 thereafter, the commissioner shall provide by electronic means to the board
133.11data sufficient for a county, watershed district, or the board to identify claimants enrolled
133.12in the program. The board shall notify the commissioner of any claimant that has been
133.13determined by a county, watershed district, or the board to be noncompliant with the
133.14requirements of section 103F.48 on or before August 1 of each year in which the certification
133.15under subdivision 4 is due.
133.16    Subd. 6. Length of enrollment. Land approved for enrollment under subdivision 3,
133.17paragraph (b), remains in the program for five years unless terminated under subdivision
133.1810.
133.19    Subd. 7. Payment amount. A claimant is eligible to receive an annual payment equal
133.20to $40 per acre for each tillable acre converted a public waters buffer.
133.21    Subd. 8. Annual payment. The commissioner shall make the payments required under
133.22subdivision 7 annually on or before October 1 based on applications or certifications received
133.23on or before April 1 of that year. No future payment shall be made to a claimant for property
133.24after it has been terminated from the program. Interest at the annual rate determined under
133.25section 270C.40 shall be included with any payment not paid by the later of October 1 of
133.26the year the application or certification was due, or 180 days after the completed application
133.27or certification was filed.
133.28    Subd. 9. Multiple claimants. No more than one claimant is entitled to a payment under
133.29this section with respect to any tract, parcel, or piece of land that has been assigned the same
133.30parcel identification number. When enrolled agricultural land is owned by two or more
133.31persons, the owners must determine which person is eligible to claim the payments. In the
133.32case of property sold or transferred, the former owner and the purchaser or grantee may
133.33determine which person is eligible to claim the payments. If they cannot agree, the matter
133.34shall be referred to the commissioner, whose decision shall be final.
134.1    Subd. 10. Reasons for termination. (a) Agricultural land enrolled in the program may
134.2be terminated from the program for any of the following reasons:
134.3(1) there are delinquent taxes on the land;
134.4(2) the commissioner receives notification from the board of noncompliance under
134.5subdivision 5;
134.6(3) the claimant does not timely submit a certification form after being notified by the
134.7commissioner that the annual certification was not received by April l; or
134.8(4) the claimant voluntarily withdraws from the program.
134.9(b) The commissioner shall prepare a notice of termination for any land that is to be
134.10terminated from the program. The notice of termination must contain the parcel identification
134.11numbers, the reason for termination, and the effective date of termination. The commissioner
134.12shall mail the notice of the termination to the claimant at least 60 days before the effective
134.13date of termination.
134.14    Subd. 11. Compliance audit. The commissioner may examine any application or annual
134.15certification to ensure compliance with this section.
134.16    Subd. 12. Penalty. If the commissioner determines a claimant intentionally filed a false
134.17application or certification under this section, the commissioner shall notify the claimant
134.18of the determination and the penalty amount for which the claimant is liable. The penalty
134.19is equal to the total payments received while enrolled in the program, plus interest calculated
134.20from the date the payments were made at the annual rate determined under section 270C.40.
134.21The claimant has 90 days to satisfy the payment from the date on the notice of determination.
134.22If the penalty is not paid within the 90-day period, the commissioner shall certify the amount
134.23to the county auditor for collection as a part of the general ad valorem real property taxes
134.24on the land in the following taxes payable year.
134.25    Subd. 13. Appeal to Tax Court. Any person aggrieved by the commissioner's decision
134.26to deny an application for enrollment, to assess a penalty, to terminate land from the program,
134.27or to deny payment to a claimant may, within 60 days of the date on the notice of
134.28determination or notice of termination, or after 180 days of the submission of the application
134.29or annual certification if no determination is issued, appeal to the Tax Court under chapter
134.30271 as if the appeal is from an order of the commissioner.
134.31    Subd. 14. Appropriation. The amount necessary to make the payments under this section
134.32is annually appropriated to the commissioner from the general fund.
134.33EFFECTIVE DATE.This section is effective for payments made in 2018 and thereafter.

135.1    Sec. 2. Minnesota Statutes 2016, section 127A.45, subdivision 10, is amended to read:
135.2    Subd. 10. Payments to school nonoperating funds. Each fiscal year state general fund
135.3payments for a district nonoperating fund must be made at the current year aid payment
135.4percentage of the estimated entitlement during the fiscal year of the entitlement. This amount
135.5shall be paid in 12 six equal monthly installments beginning in July. The amount of the
135.6actual entitlement, after adjustment for actual data, minus the payments made during the
135.7fiscal year of the entitlement must be paid prior to October 31 of the following school year.
135.8The commissioner may make advance payments of debt service equalization aid and
135.9state-paid tax credits for a district's debt service fund earlier than would occur under the
135.10preceding schedule if the district submits evidence showing a serious cash flow problem in
135.11the fund. The commissioner may make earlier payments during the year and, if necessary,
135.12increase the percent of the entitlement paid to reduce the cash flow problem.
135.13EFFECTIVE DATE.This section is effective beginning with fiscal year 2019.

135.14    Sec. 3. Minnesota Statutes 2016, section 127A.45, subdivision 13, is amended to read:
135.15    Subd. 13. Aid payment percentage. Except as provided in subdivisions 10, 11, 12, 12a,
135.16and 14, each fiscal year, all education aids and credits in this chapter and chapters 120A,
135.17120B, 121A, 122A, 123A, 123B, 124D, 124E, 125A, 125B, 126C, 134, and section 273.1392,
135.18shall be paid at the current year aid payment percentage of the estimated entitlement during
135.19the fiscal year of the entitlement. For the purposes of this subdivision, a district's estimated
135.20entitlement for special education aid under section 125A.76 for fiscal year 2014 and later
135.21equals 97.4 percent of the district's entitlement for the current fiscal year. The final adjustment
135.22payment, according to subdivision 9, must be the amount of the actual entitlement, after
135.23adjustment for actual data, minus the payments made during the fiscal year of the entitlement.
135.24EFFECTIVE DATE.This section is effective beginning with fiscal year 2019.

135.25    Sec. 4. [273.1387] SCHOOL BUILDING BOND AGRICULTURAL CREDIT.
135.26    Subdivision 1. Eligibility. All class 2a, 2b, and 2c property under section 273.13,
135.27subdivision 23, other than property consisting of the house, garage, and immediately
135.28surrounding one acre of land of an agricultural homestead, is eligible to receive the credit
135.29under this section.
135.30    Subd. 2. Credit amount. For each qualifying property, the school building bond
135.31agricultural credit is equal to 50 percent of the property's eligible net tax capacity multiplied
135.32by the school debt tax rate determined under section 275.08, subdivision 1b.
136.1    Subd. 3. Credit reimbursements. The county auditor shall determine the tax reductions
136.2allowed under this section within the county for each taxes payable year and shall certify
136.3that amount to the commissioner of revenue as a part of the abstracts of tax lists submitted
136.4under section 275.29. Any prior year adjustments shall also be certified on the abstracts of
136.5tax lists. The commissioner shall review the certifications for accuracy, and may make such
136.6changes as are deemed necessary, or return the certification to the county auditor for
136.7correction. The credit under this section must be used to reduce the school district net tax
136.8capacity-based property tax as provided in section 273.1393.
136.9    Subd. 4. Payment. The commissioner of revenue shall certify the total of the tax
136.10reductions granted under this section for each taxes payable year within each school district
136.11to the commissioner of education, who shall pay the reimbursement amounts to each school
136.12district as provided in section 273.1392.
136.13    Subd. 5. Appropriation. An amount sufficient to make the payments required by this
136.14section is annually appropriated from the general fund to the commissioner of education.
136.15EFFECTIVE DATE.This section is effective beginning with taxes payable in 2018.

136.16    Sec. 5. Minnesota Statutes 2016, section 273.1392, is amended to read:
136.17273.1392 PAYMENT; SCHOOL DISTRICTS.
136.18The amounts of bovine tuberculosis credit reimbursements under section 273.113;
136.19conservation tax credits under section 273.119; disaster or emergency reimbursement under
136.20sections 273.1231 to 273.1235; homestead and agricultural credits under section sections
136.21273.1384 and 273.1387; aids and credits under section 273.1398; enterprise zone property
136.22credit payments under section 469.171; and metropolitan agricultural preserve reduction
136.23under section 473H.10 for school districts, shall be certified to the Department of Education
136.24by the Department of Revenue. The amounts so certified shall be paid according to section
136.25127A.45 , subdivisions 9, 10, and 13.
136.26EFFECTIVE DATE.This section is effective beginning with taxes payable in 2018.

136.27    Sec. 6. Minnesota Statutes 2016, section 273.1393, is amended to read:
136.28273.1393 COMPUTATION OF NET PROPERTY TAXES.
136.29    Notwithstanding any other provisions to the contrary, "net" property taxes are determined
136.30by subtracting the credits in the order listed from the gross tax:
136.31    (1) disaster credit as provided in sections 273.1231 to 273.1235;
137.1    (2) powerline credit as provided in section 273.42;
137.2    (3) agricultural preserves credit as provided in section 473H.10;
137.3    (4) enterprise zone credit as provided in section 469.171;
137.4    (5) disparity reduction credit;
137.5    (6) conservation tax credit as provided in section 273.119;
137.6    (7) the school bond credit as provided in section 273.1387;
137.7    (8) agricultural credit as provided in section 273.1384;
137.8    (8) (9) taconite homestead credit as provided in section 273.135;
137.9    (9) (10) supplemental homestead credit as provided in section 273.1391; and
137.10    (10) (11) the bovine tuberculosis zone credit, as provided in section 273.113.
137.11    The combination of all property tax credits must not exceed the gross tax amount.
137.12EFFECTIVE DATE.This section is effective beginning with taxes payable in 2018.

137.13    Sec. 7. Minnesota Statutes 2016, section 275.065, subdivision 3, is amended to read:
137.14    Subd. 3. Notice of proposed property taxes. (a) The county auditor shall prepare and
137.15the county treasurer shall deliver after November 10 and on or before November 24 each
137.16year, by first class mail to each taxpayer at the address listed on the county's current year's
137.17assessment roll, a notice of proposed property taxes. Upon written request by the taxpayer,
137.18the treasurer may send the notice in electronic form or by electronic mail instead of on paper
137.19or by ordinary mail.
137.20    (b) The commissioner of revenue shall prescribe the form of the notice.
137.21    (c) The notice must inform taxpayers that it contains the amount of property taxes each
137.22taxing authority proposes to collect for taxes payable the following year. In the case of a
137.23town, or in the case of the state general tax, the final tax amount will be its proposed tax.
137.24The notice must clearly state for each city that has a population over 500, county, school
137.25district, regional library authority established under section 134.201, and metropolitan taxing
137.26districts as defined in paragraph (i), the time and place of a meeting for each taxing authority
137.27in which the budget and levy will be discussed and public input allowed, prior to the final
137.28budget and levy determination. The taxing authorities must provide the county auditor with
137.29the information to be included in the notice on or before the time it certifies its proposed
137.30levy under subdivision 1. The public must be allowed to speak at that meeting, which must
137.31occur after November 24 and must not be held before 6:00 p.m. It must provide a telephone
138.1number for the taxing authority that taxpayers may call if they have questions related to the
138.2notice and an address where comments will be received by mail, except that no notice
138.3required under this section shall be interpreted as requiring the printing of a personal
138.4telephone number or address as the contact information for a taxing authority. If a taxing
138.5authority does not maintain public offices where telephone calls can be received by the
138.6authority, the authority may inform the county of the lack of a public telephone number and
138.7the county shall not list a telephone number for that taxing authority.
138.8    (d) The notice must state for each parcel:
138.9    (1) the market value of the property as determined under section 273.11, and used for
138.10computing property taxes payable in the following year and for taxes payable in the current
138.11year as each appears in the records of the county assessor on November 1 of the current
138.12year; and, in the case of residential property, whether the property is classified as homestead
138.13or nonhomestead. The notice must clearly inform taxpayers of the years to which the market
138.14values apply and that the values are final values;
138.15    (2) the items listed below, shown separately by county, city or town, and state general
138.16tax, agricultural homestead credit under section 273.1384, school building bond agricultural
138.17credit under section 273.1387, voter approved school levy, other local school levy, and the
138.18sum of the special taxing districts, and as a total of all taxing authorities:
138.19    (i) the actual tax for taxes payable in the current year; and
138.20    (ii) the proposed tax amount.
138.21    If the county levy under clause (2) includes an amount for a lake improvement district
138.22as defined under sections 103B.501 to 103B.581, the amount attributable for that purpose
138.23must be separately stated from the remaining county levy amount.
138.24    In the case of a town or the state general tax, the final tax shall also be its proposed tax
138.25unless the town changes its levy at a special town meeting under section 365.52. If a school
138.26district has certified under section 126C.17, subdivision 9, that a referendum will be held
138.27in the school district at the November general election, the county auditor must note next
138.28to the school district's proposed amount that a referendum is pending and that, if approved
138.29by the voters, the tax amount may be higher than shown on the notice. In the case of the
138.30city of Minneapolis, the levy for Minneapolis Park and Recreation shall be listed separately
138.31from the remaining amount of the city's levy. In the case of the city of St. Paul, the levy for
138.32the St. Paul Library Agency must be listed separately from the remaining amount of the
138.33city's levy. In the case of Ramsey County, any amount levied under section 134.07 may be
138.34listed separately from the remaining amount of the county's levy. In the case of a parcel
139.1where tax increment or the fiscal disparities areawide tax under chapter 276A or 473F
139.2applies, the proposed tax levy on the captured value or the proposed tax levy on the tax
139.3capacity subject to the areawide tax must each be stated separately and not included in the
139.4sum of the special taxing districts; and
139.5    (3) the increase or decrease between the total taxes payable in the current year and the
139.6total proposed taxes, expressed as a percentage.
139.7    For purposes of this section, the amount of the tax on homesteads qualifying under the
139.8senior citizens' property tax deferral program under chapter 290B is the total amount of
139.9property tax before subtraction of the deferred property tax amount.
139.10    (e) The notice must clearly state that the proposed or final taxes do not include the
139.11following:
139.12    (1) special assessments;
139.13    (2) levies approved by the voters after the date the proposed taxes are certified, including
139.14bond referenda and school district levy referenda;
139.15    (3) a levy limit increase approved by the voters by the first Tuesday after the first Monday
139.16in November of the levy year as provided under section 275.73;
139.17    (4) amounts necessary to pay cleanup or other costs due to a natural disaster occurring
139.18after the date the proposed taxes are certified;
139.19    (5) amounts necessary to pay tort judgments against the taxing authority that become
139.20final after the date the proposed taxes are certified; and
139.21    (6) the contamination tax imposed on properties which received market value reductions
139.22for contamination.
139.23    (f) Except as provided in subdivision 7, failure of the county auditor to prepare or the
139.24county treasurer to deliver the notice as required in this section does not invalidate the
139.25proposed or final tax levy or the taxes payable pursuant to the tax levy.
139.26    (g) If the notice the taxpayer receives under this section lists the property as
139.27nonhomestead, and satisfactory documentation is provided to the county assessor by the
139.28applicable deadline, and the property qualifies for the homestead classification in that
139.29assessment year, the assessor shall reclassify the property to homestead for taxes payable
139.30in the following year.
139.31    (h) In the case of class 4 residential property used as a residence for lease or rental
139.32periods of 30 days or more, the taxpayer must either:
140.1    (1) mail or deliver a copy of the notice of proposed property taxes to each tenant, renter,
140.2or lessee; or
140.3    (2) post a copy of the notice in a conspicuous place on the premises of the property.
140.4    The notice must be mailed or posted by the taxpayer by November 27 or within three
140.5days of receipt of the notice, whichever is later. A taxpayer may notify the county treasurer
140.6of the address of the taxpayer, agent, caretaker, or manager of the premises to which the
140.7notice must be mailed in order to fulfill the requirements of this paragraph.
140.8    (i) For purposes of this subdivision and subdivision 6, "metropolitan special taxing
140.9districts" means the following taxing districts in the seven-county metropolitan area that
140.10levy a property tax for any of the specified purposes listed below:
140.11    (1) Metropolitan Council under section 473.132, 473.167, 473.249, 473.325, 473.446,
140.12473.521 , 473.547, or 473.834;
140.13    (2) Metropolitan Airports Commission under section 473.667, 473.671, or 473.672; and
140.14    (3) Metropolitan Mosquito Control Commission under section 473.711.
140.15    For purposes of this section, any levies made by the regional rail authorities in the county
140.16of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 398A
140.17shall be included with the appropriate county's levy.
140.18    (j) The governing body of a county, city, or school district may, with the consent of the
140.19county board, include supplemental information with the statement of proposed property
140.20taxes about the impact of state aid increases or decreases on property tax increases or
140.21decreases and on the level of services provided in the affected jurisdiction. This supplemental
140.22information may include information for the following year, the current year, and for as
140.23many consecutive preceding years as deemed appropriate by the governing body of the
140.24county, city, or school district. It may include only information regarding:
140.25    (1) the impact of inflation as measured by the implicit price deflator for state and local
140.26government purchases;
140.27    (2) population growth and decline;
140.28    (3) state or federal government action; and
140.29    (4) other financial factors that affect the level of property taxation and local services
140.30that the governing body of the county, city, or school district may deem appropriate to
140.31include.
141.1    The information may be presented using tables, written narrative, and graphic
141.2representations and may contain instruction toward further sources of information or
141.3opportunity for comment.
141.4EFFECTIVE DATE.This section is effective beginning with taxes payable in 2018.

141.5    Sec. 8. Minnesota Statutes 2016, section 275.07, subdivision 2, is amended to read:
141.6    Subd. 2. School district in more than one county levies; special requirements. (a) In
141.7school districts lying in more than one county, the clerk shall certify the tax levied to the
141.8auditor of the county in which the administrative offices of the school district are located.
141.9(b) The district must identify the portion of the school district levy that is levied for debt
141.10service at the time the levy is certified under this section. For the purposes of this paragraph,
141.11"levied for debt service" means levies authorized under sections 123B.53, 123B.535, and
141.12123B.55, as adjusted by sections 126C.46 and 126C.48, net of any debt excess levy reductions
141.13under section 475.61, subdivision 4, excluding debt service amounts necessary for repayment
141.14of other postemployment benefits under section 475.52, subdivision 6.
141.15EFFECTIVE DATE.This section is effective beginning with taxes payable in 2018.

141.16    Sec. 9. Minnesota Statutes 2016, section 275.08, subdivision 1b, is amended to read:
141.17    Subd. 1b. Computation of tax rates. (a) The amounts certified to be levied against net
141.18tax capacity under section 275.07 by an individual local government unit shall be divided
141.19by the total net tax capacity of all taxable properties within the local government unit's
141.20taxing jurisdiction. The resulting ratio, the local government's local tax rate, multiplied by
141.21each property's net tax capacity shall be each property's net tax capacity tax for that local
141.22government unit before reduction by any credits.
141.23(b) The auditor must also determine the school debt tax rate for each school district equal
141.24to (1) the school debt service levy certified under section 275.07, subdivision 2, divided by
141.25(2) the total net tax capacity of all taxable property within the district.
141.26(c) Any amount certified to the county auditor to be levied against market value shall
141.27be divided by the total referendum market value of all taxable properties within the taxing
141.28district. The resulting ratio, the taxing district's new referendum tax rate, multiplied by each
141.29property's referendum market value shall be each property's new referendum tax before
141.30reduction by any credits. For the purposes of this subdivision, "referendum market value"
141.31means the market value as defined in section 126C.01, subdivision 3.
141.32EFFECTIVE DATE.This section is effective beginning with taxes payable in 2018.

142.1    Sec. 10. Minnesota Statutes 2016, section 276.04, subdivision 2, is amended to read:
142.2    Subd. 2. Contents of tax statements. (a) The treasurer shall provide for the printing of
142.3the tax statements. The commissioner of revenue shall prescribe the form of the property
142.4tax statement and its contents. The tax statement must not state or imply that property tax
142.5credits are paid by the state of Minnesota. The statement must contain a tabulated statement
142.6of the dollar amount due to each taxing authority and the amount of the state tax from the
142.7parcel of real property for which a particular tax statement is prepared. The dollar amounts
142.8attributable to the county, the state tax, the voter approved school tax, the other local school
142.9tax, the township or municipality, and the total of the metropolitan special taxing districts
142.10as defined in section 275.065, subdivision 3, paragraph (i), must be separately stated. The
142.11amounts due all other special taxing districts, if any, may be aggregated except that any
142.12levies made by the regional rail authorities in the county of Anoka, Carver, Dakota, Hennepin,
142.13Ramsey, Scott, or Washington under chapter 398A shall be listed on a separate line directly
142.14under the appropriate county's levy. If the county levy under this paragraph includes an
142.15amount for a lake improvement district as defined under sections 103B.501 to 103B.581,
142.16the amount attributable for that purpose must be separately stated from the remaining county
142.17levy amount. In the case of Ramsey County, if the county levy under this paragraph includes
142.18an amount for public library service under section 134.07, the amount attributable for that
142.19purpose may be separated from the remaining county levy amount. The amount of the tax
142.20on homesteads qualifying under the senior citizens' property tax deferral program under
142.21chapter 290B is the total amount of property tax before subtraction of the deferred property
142.22tax amount. The amount of the tax on contamination value imposed under sections 270.91
142.23to 270.98, if any, must also be separately stated. The dollar amounts, including the dollar
142.24amount of any special assessments, may be rounded to the nearest even whole dollar. For
142.25purposes of this section whole odd-numbered dollars may be adjusted to the next higher
142.26even-numbered dollar. The amount of market value excluded under section 273.11,
142.27subdivision 16
, if any, must also be listed on the tax statement.
142.28    (b) The property tax statements for manufactured homes and sectional structures taxed
142.29as personal property shall contain the same information that is required on the tax statements
142.30for real property.
142.31    (c) Real and personal property tax statements must contain the following information
142.32in the order given in this paragraph. The information must contain the current year tax
142.33information in the right column with the corresponding information for the previous year
142.34in a column on the left:
142.35    (1) the property's estimated market value under section 273.11, subdivision 1;
143.1    (2) the property's homestead market value exclusion under section 273.13, subdivision
143.235;
143.3    (3) the property's taxable market value under section 272.03, subdivision 15;
143.4    (4) the property's gross tax, before credits;
143.5    (5) for homestead agricultural properties, the credit credits under section sections
143.6273.1384 and 273.1387 ;
143.7    (6) any credits received under sections 273.119; 273.1234 or 273.1235; 273.135;
143.8273.1391 ; 273.1398, subdivision 4; 469.171; and 473H.10, except that the amount of credit
143.9received under section 273.135 must be separately stated and identified as "taconite tax
143.10relief"; and
143.11    (7) the net tax payable in the manner required in paragraph (a).
143.12    (d) If the county uses envelopes for mailing property tax statements and if the county
143.13agrees, a taxing district may include a notice with the property tax statement notifying
143.14taxpayers when the taxing district will begin its budget deliberations for the current year,
143.15and encouraging taxpayers to attend the hearings. If the county allows notices to be included
143.16in the envelope containing the property tax statement, and if more than one taxing district
143.17relative to a given property decides to include a notice with the tax statement, the county
143.18treasurer or auditor must coordinate the process and may combine the information on a
143.19single announcement.
143.20EFFECTIVE DATE.This section is effective beginning with taxes payable in 2018.

143.21    Sec. 11. Minnesota Statutes 2016, section 290A.04, subdivision 2, is amended to read:
143.22    Subd. 2. Homeowners; homestead credit refund. A claimant whose property taxes
143.23payable are in excess of the percentage of the household income stated below shall pay an
143.24amount equal to the percent of income shown for the appropriate household income level
143.25along with the percent to be paid by the claimant of the remaining amount of property taxes
143.26payable. The state refund equals the amount of property taxes payable that remain, up to
143.27the state refund amount shown below.
143.28
143.29
143.30
Household Income
Percent of Income
Percent Paid by
Claimant
Maximum
State
Refund
143.31
$0 to 1,619
1.0 percent
15 percent
$
2,580
143.32
1,620 to 3,229
1.1 percent
15 percent
$
2,580
143.33
3,230 to 4,889
1.2 percent
15 percent
$
2,580
144.1
4,890 to 6,519
1.3 percent
20 percent
$
2,580
144.2
6,520 to 8,129
1.4 percent
20 percent
$
2,580
144.3
8,130 to 11,389
1.5 percent
20 percent
$
2,580
144.4
11,390 to 13,009
1.6 percent
20 percent
$
2,580
144.5
13,010 to 14,649
1.7 percent
20 percent
$
2,580
144.6
14,650 to 16,269
1.8 percent
20 percent
$
2,580
144.7
16,270 to 17,879
1.9 percent
25 percent
$
2,580
144.8
17,880 to 22,779
2.0 percent
25 percent
$
2,580
144.9
22,780 to 24,399
2.0 percent
30 percent
$
2,580
144.10
24,400 to 27,659
2.0 percent
30 percent
$
2,580
144.11
27,660 to 39,029
2.0 percent
35 percent
$
2,580
144.12
39,030 to 56,919
2.0 percent
35 percent
$
2,090
144.13
56,920 to 65,049
2.0 percent
40 percent
$
1,830
144.14
65,050 to 73,189
2.1 percent
40 percent
$
1,510
144.15
73,190 to 81,319
2.2 percent
40 percent
$
1,350
144.16
81,320 to 89,449
2.3 percent
40 percent
$
1,180
144.17
89,450 to 94,339
2.4 percent
45 percent
$
1,000
144.18
94,340 to 97,609
2.5 percent
45 percent
$
830
144.19
97,610 to 101,559
2.5 percent
50 percent
$
680
144.20
101,560 to 105,499
2.5 percent
50 percent
$
500
144.21
144.22
144.23
Household Income
Percent of Income
Percent Paid by
Claimant
Maximum
State
Refund
144.24
$0 to 1,699
1.0 percent
10.695 percent
$
2,870
144.25
1,700 to 3,389
1.1 percent
10.695 percent
$
2,870
144.26
3,390 to 5,139
1.2 percent
10.695 percent
$
2,870
144.27
5,140 to 6,849
1.3 percent
14.26 percent
$
2,870
144.28
6,850 to 8,539
1.4 percent
14.26 percent
$
2,870
144.29
8,540 to 11,959
1.5 percent
14.26 percent
$
2,870
144.30
11,960 to 13,669
1.6 percent
14.26 percent
$
2,870
144.31
13,670 to 15,389
1.7 percent
14.26 percent
$
2,870
144.32
15,390 to 17,089
1.8 percent
14.26 percent
$
2,870
144.33
17,090 to 18,779
1.9 percent
17.825 percent
$
2,870
144.34
18,780 to 23,929
2.0 percent
17.825 percent
$
2,870
144.35
23,930 to 25,629
2.0 percent
21.39 percent
$
2,870
144.36
25,630 to 29,059
2.0 percent
21.39 percent
$
2,870
144.37
29,060 to 40,999
2.0 percent
24.955 percent
$
2,870
144.38
41,000 to 59,789
2.0 percent
24.955 percent
$
2,330
145.1
59,790 to 68,329
2.0 percent
28.52 percent
$
2,033
145.2
68,330 to 76,879
2.1 percent
28.52 percent
$
1,684
145.3
76,880 to 85,419
2.2 percent
28.52 percent
$
1,504
145.4
85,420 to 93,959
2.3 percent
28.52 percent
$
1,313
145.5
93,960 to 99,099
2.4 percent
32.085 percent
$
1,112
145.6
99,100 to 102,539
2.5 percent
32.085 percent
$
921
145.7
102,540 to 106,679
2.5 percent
35.65 percent
$
752
145.8
106,680 to 110,819
2.5 percent
35.65 percent
$
561
145.9    The payment made to a claimant shall be the amount of the state refund calculated under
145.10this subdivision. No payment is allowed if the claimant's household income is $105,500
145.11$110,820 or more.
145.12EFFECTIVE DATE.This section is effective for refunds based on taxes payable in
145.132018 and following years.

145.14    Sec. 12. Minnesota Statutes 2016, section 290A.04, subdivision 2a, is amended to read:
145.15    Subd. 2a. Renters. A claimant whose rent constituting property taxes exceeds the
145.16percentage of the household income stated below must pay an amount equal to the percent
145.17of income shown for the appropriate household income level along with the percent to be
145.18paid by the claimant of the remaining amount of rent constituting property taxes. The state
145.19refund equals the amount of rent constituting property taxes that remain, up to the maximum
145.20state refund amount shown below.
145.21
145.22
145.23
Household Income
Percent of Income
Percent Paid by
Claimant
Maximum
State
Refund
145.24
$0 to 4,909
1.0 percent
5 percent
$
2,000
145.25
4,910 to 6,529
1.0 percent
10 percent
$
2,000
145.26
6,530 to 8,159
1.1 percent
10 percent
$
1,950
145.27
8,160 to 11,439
1.2 percent
10 percent
$
1,900
145.28
11,440 to 14,709
1.3 percent
15 percent
$
1,850
145.29
14,710 to 16,339
1.4 percent
15 percent
$
1,800
145.30
16,340 to 17,959
1.4 percent
20 percent
$
1,750
145.31
17,960 to 21,239
1.5 percent
20 percent
$
1,700
145.32
21,240 to 22,869
1.6 percent
20 percent
$
1,650
145.33
22,870 to 24,499
1.7 percent
25 percent
$
1,650
145.34
24,500 to 27,779
1.8 percent
25 percent
$
1,650
145.35
27,780 to 29,399
1.9 percent
30 percent
$
1,650
145.36
29,400 to 34,299
2.0 percent
30 percent
$
1,650
146.1
34,300 to 39,199
2.0 percent
35 percent
$
1,650
146.2
39,200 to 45,739
2.0 percent
40 percent
$
1,650
146.3
45,740 to 47,369
2.0 percent
45 percent
$
1,500
146.4
47,370 to 49,009
2.0 percent
45 percent
$
1,350
146.5
49,010 to 50,649
2.0 percent
45 percent
$
1,150
146.6
50,650 to 52,269
2.0 percent
50 percent
$
1,000
146.7
52,270 to 53,909
2.0 percent
50 percent
$
900
146.8
53,910 to 55,539
2.0 percent
50 percent
$
500
146.9
55,540 to 57,169
2.0 percent
50 percent
$
200
146.10
146.11
146.12
Household Income
Percent of Income
Percent Paid by
Claimant
Maximum
State
Refund
146.13
$0 to 5,159
1.0 percent
5 percent
$
3,070
146.14
5,160 to 6,859
1.0 percent
10 percent
$
3,070
146.15
6,860 to 8,569
1.1 percent
10 percent
$
3,070
146.16
8,570 to 12,019
1.2 percent
10 percent
$
3,070
146.17
12,020 to 15,449
1.3 percent
10 percent
$
3,070
146.18
15,450 to 17,159
1.4 percent
10 percent
$
3,070
146.19
17,160 to 18,869
1.4 percent
12 percent
$
3,070
146.20
18,870 to 22,309
1.5 percent
12 percent
$
2,870
146.21
22,310 to 24,019
1.6 percent
12 percent
$
2,670
146.22
24,020 to 25,739
1.7 percent
17 percent
$
2,470
146.23
25,740 to 29,179
1.8 percent
17 percent
$
2,270
146.24
29,180 to 30,879
1.9 percent
22 percent
$
2,070
146.25
30,880 to 32,999
2.0 percent
22 percent
$
2,070
146.26
33,000 to 36,029
2.0 percent
22 percent
$
1,870
146.27
36,030 to 41,179
2.0 percent
27 percent
$
1,870
146.28
41,180 to 48,049
2.0 percent
32 percent
$
1,870
146.29
48,050 to 51,479
2.0 percent
37 percent
$
1,670
146.30
51,480 to 53,209
2.0 percent
37 percent
$
1,470
146.31
53,210 to 54,909
2.0 percent
42 percent
$
1,270
146.32
54,910 to 59,999
2.0 percent
42 percent
$
1,070
146.33
60,000 to 63,999
2.0 percent
42 percent
$
870
146.34
64,000 to 67,999
2.0 percent
42 percent
$
670
146.35
68,000 to 71,999
2.0 percent
42 percent
$
470
146.36
72,000 to 74,999
2.0 percent
42 percent
$
270
147.1    The payment made to a claimant is the amount of the state refund calculated under this
147.2subdivision. No payment is allowed if the claimant's household income is $57,170 $75,000
147.3or more.
147.4EFFECTIVE DATE.This section is effective for refunds based on rent paid in 2017
147.5and following years.

147.6    Sec. 13. Minnesota Statutes 2016, section 290A.04, subdivision 4, is amended to read:
147.7    Subd. 4. Inflation adjustment. (a) Beginning for property tax refunds payable in calendar
147.8year 2002, the commissioner shall annually adjust the dollar amounts of the income thresholds
147.9and the maximum refunds under subdivisions 2 and 2a for inflation. The commissioner
147.10shall make the inflation adjustments in accordance with section 1(f) of the Internal Revenue
147.11Code, except that for purposes of this subdivision the percentage increase shall be determined
147.12as provided in this subdivision.
147.13    (b) In adjusting the dollar amounts of the income thresholds and the maximum refunds
147.14under subdivision 2 for inflation, the percentage increase shall be determined from the year
147.15ending on June 30, 2013 2017, to the year ending on June 30 of the year preceding that in
147.16which the refund is payable.
147.17    (c) In adjusting the dollar amounts of the income thresholds and the maximum refunds
147.18under subdivision 2a for inflation, the percentage increase shall be determined from the
147.19year ending on June 30, 2013 2017, to the year ending on June 30 of the year preceding that
147.20in which the refund is payable.
147.21    (d) The commissioner shall use the appropriate percentage increase to annually adjust
147.22the income thresholds and maximum refunds under subdivisions 2 and 2a for inflation
147.23without regard to whether or not the income tax brackets are adjusted for inflation in that
147.24year. The commissioner shall round the thresholds and the maximum amounts under
147.25subdivision 2, as adjusted to the nearest $10 amount. If the amount ends in $5, the
147.26commissioner shall round it up to the next $10 amount. The commissioner shall round the
147.27maximum amounts under subdivision 2, as adjusted to the nearest $1 amount. The
147.28commissioner shall round the thresholds and the maximum amounts under subdivision 2a,
147.29as adjusted to the nearest $10 amount. If the amount ends in $5, the commissioner shall
147.30round it up to the next $10 amount.
147.31    (e) The commissioner shall annually announce the adjusted refund schedule at the same
147.32time provided under section 290.06. The determination of the commissioner under this
147.33subdivision is not a rule under the Administrative Procedure Act.
148.1EFFECTIVE DATE.This section is effective for refunds based on taxes payable in
148.22019 and rent paid in 2018 and following years.

148.3    Sec. 14. Minnesota Statutes 2016, section 469.169, is amended by adding a subdivision
148.4to read:
148.5    Subd. 20. Additional border city allocations. (a) In addition to the tax reductions
148.6authorized in subdivisions 12 to 19, the commissioner shall allocate $3,000,000 for tax
148.7reductions to border city enterprise zones in cities located on the western border of the state.
148.8The commissioner shall allocate this amount among cities on a per capita basis. Allocations
148.9under this subdivision may be used for tax reductions under sections 469.171, 469.1732,
148.10and 469.1734, or for other offsets of taxes imposed on or remitted by businesses located in
148.11the enterprise zone, but only if the municipality determines that the granting of the tax
148.12reduction or offset is necessary to retain a business within or attract a business to the zone.
148.13(b) The allocations under this subdivision do not cancel or expire, but remain available
148.14until used by the city.

148.15    Sec. 15. Minnesota Statutes 2016, section 477A.011, subdivision 34, is amended to read:
148.16    Subd. 34. City revenue need. (a) For a city with a population equal to or greater than
148.1710,000, "city revenue need" is 1.15 times the sum of (1) 4.59 times the pre-1940 housing
148.18percentage; plus (2) 0.622 times the percent of housing built between 1940 and 1970; plus
148.19(3) 169.415 times the jobs per capita; plus (4) the sparsity adjustment; plus (5) 307.664.
148.20    (b) For a city with a population equal to or greater than 2,500 and less than 10,000, "city
148.21revenue need" is 1.15 times the sum of (1) 572.62; plus (2) 5.026 times the pre-1940 housing
148.22percentage; minus (3) 53.768 times household size; plus (4) 14.022 times peak population
148.23decline; plus (5) the sparsity adjustment.
148.24    (c) For a city with a population less than 2,500, "city revenue need" is the sum of (1)
148.25410 plus; (2) 0.367 times the city's population over 100; plus (3) the sparsity adjustment.
148.26The city revenue need for a city under this paragraph shall not exceed 630 plus the city's
148.27sparsity adjustment.
148.28    (d) For a city with a population of at least 2,500 but less than 3,000, the "city revenue
148.29need" equals (1) the transition factor times the city's revenue need calculated in paragraph
148.30(b); plus (2) 630 times the difference between one and the transition factor. For a city with
148.31a population of at least 10,000 but less than 10,500 11,000, the "city revenue need" equals
148.32(1) the transition factor times the city's revenue need calculated in paragraph (a); plus (2)
149.1the city's revenue need calculated under the formula in paragraph (b) times the difference
149.2between one and the transition factor. For purposes of the first sentence of this paragraph
149.3"transition factor" is 0.2 percent times the amount that the city's population exceeds the
149.4minimum threshold in either of the first two sentences. For purposes of the second sentence
149.5of this paragraph, "transition factor" is 0.1 percent times the amount that the city's population
149.6exceeds the minimum threshold.
149.7    (e) The city revenue need cannot be less than zero.
149.8    (f) For calendar year 2015 and subsequent years, the city revenue need for a city, as
149.9determined in paragraphs (a) to (e), is multiplied by the ratio of the annual implicit price
149.10deflator for government consumption expenditures and gross investment for state and local
149.11governments as prepared by the United States Department of Commerce, for the most
149.12recently available year to the 2013 implicit price deflator for state and local government
149.13purchases.
149.14EFFECTIVE DATE.This section is effective for aids payable in calendar year 2018
149.15and thereafter.

149.16    Sec. 16. Minnesota Statutes 2016, section 477A.011, subdivision 45, is amended to read:
149.17    Subd. 45. Sparsity adjustment. For a city with a population of 10,000 or more, the
149.18sparsity adjustment is 100 for any city with an average population density less than 150 per
149.19square mile, according to the most recent federal census, and. For a city with a population
149.20less than 10,000, the sparsity adjustment is 200 for any city with an average population
149.21density less than 30 per square mile, according to the most recent federal census. The sparsity
149.22adjustment is zero for all other cities.
149.23EFFECTIVE DATE.This section is effective for aids payable in calendar year 2018
149.24and thereafter.

149.25    Sec. 17. Minnesota Statutes 2016, section 477A.0124, subdivision 4, is amended to read:
149.26    Subd. 4. County tax-base equalization aid. (a) For 2006 and subsequent years, the
149.27money appropriated to county tax-base equalization aid each calendar year, after the payment
149.28under paragraph (f), shall be apportioned among the counties according to each county's
149.29tax-base equalization aid factor.
149.30(b) A county's tax-base equalization aid factor is equal to the amount by which (i) $185
149.31$190 times the county's population, exceeds (ii) 9.45 nine percent of the county's net tax
149.32capacity.
150.1(c) In the case of a county with a population less than 10,000, the factor determined in
150.2paragraph (b) shall be multiplied by a factor of three.
150.3(d) In the case of a county with a population greater than or equal to 10,000, but less
150.4than 12,500, the factor determined in paragraph (b) shall be multiplied by a factor of two.
150.5(e) In the case of a county with a population greater than 500,000, the factor determined
150.6in paragraph (b) shall be multiplied by a factor of 0.25.
150.7(f) Before the money appropriated to county base equalization aid is apportioned among
150.8the counties as provided in paragraph (a), an amount up to $73,259 is allocated annually to
150.9Anoka County and up to $59,664 is annually allocated to Washington County for the county
150.10to pay postretirement costs of health insurance premiums for court employees. The allocation
150.11under this paragraph is in addition to the allocations under paragraphs (a) to (e). Beginning
150.12with aid payable in 2019, the amount under paragraph (b), item (i), shall be increased by
150.13the ratio of the statewide net tax capacity per capita to the statewide net tax capacity per
150.14capita in the 2017 assessment year, provided that in no case shall the ratio be less than one
150.15or the ratio in the prior year, whichever is greater. The amount shall be rounded to the nearest
150.16$10. The statewide net tax capacity per capita shall be calculated using the most recent
150.17population available for the relevant assessment year at the time of the calculation of the
150.18aid by the commissioner under section 477A.014.
150.19(g) For distributions in 2018 and subsequent years, the allocation to a county under
150.20paragraphs (a) to (e) shall not be less than:
150.21(1) an amount equal to 0.27 percent of the total appropriation available for that year
150.22under section 477A.03, subdivision 2b, paragraph (b); or
150.23(2) 95 percent of the tax base equalization aid for the county in the prior year, whichever
150.24is greater.
150.25If the sum of aids payable to counties under this subdivision exceeds the limit under section
150.26477A.03, subdivision 2b, paragraph (b), the distribution for those counties whose aid amounts
150.27exceed their minimum aid must be proportionately reduced so that the amount of aid
150.28distributed under this subdivision does not exceed the limit in section 477A.03, subdivision
150.292b, paragraph (b).
150.30EFFECTIVE DATE.This section is effective for aids payable in 2018 and thereafter.

151.1    Sec. 18. [477A.0126] REIMBURSEMENT OF COUNTY AND TRIBES FOR
151.2CERTAIN OUT-OF-HOME PLACEMENT.
151.3    Subdivision 1. Definition. For purposes of this section, "out-of-home placement" means
151.424-hour substitute care for an Indian child as defined by section 260C.007, subdivision 21,
151.5placed under chapter 260C and the Indian Child Welfare Act (ICWA), away from the child's
151.6parent or guardian and for whom the county social services agency or county correctional
151.7agency has been assigned responsibility for the child's placement and care, which includes
151.8placement in foster care under section 260C.007, subdivision 18, and a correctional facility
151.9pursuant to a court order.
151.10    Subd. 2. Determination of nonfederal share of costs. (a) By July 1, 2017, each county
151.11shall report the following information to the commissioners of human services and
151.12corrections:
151.13(1) the separate amounts paid out of the county's social service agency and its corrections
151.14budget for out-of-home placement of children under the ICWA in calendar years 2013,
151.152014, and 2015; and
151.16(2) the number of case days associated with the expenditures from each budget.
151.17The commissioner of human services shall prescribe the format of the report. By July 15,
151.182017, the commissioner of human services, in consultation with the commissioner of
151.19corrections, shall certify to the commissioner of revenue and to the legislative committees
151.20with jurisdiction over local government aids and out-of-home placement funding whether
151.21the data reported under this subdivision accurately reflect total expenditures by counties for
151.22out-of-home placement costs of children under the ICWA.
151.23(b) By January 1, 2018, and each January 1 thereafter, each county shall report to the
151.24commissioners of human services and corrections the separate amounts paid out of the
151.25county's social service agency and its corrections budget for out-of-home placement of
151.26children under the ICWA in the calendar years two years before the current calendar year
151.27along with the number of case days associated with the expenditures from each budget. The
151.28commissioner of human services shall prescribe the format of the report.
151.29(c) Until the commissioner of human services develops another mechanism for collecting
151.30and verifying data on out-of-home placements of children under the ICWA, and the
151.31legislature authorizes the use of that data, the data collected under this subdivision must be
151.32used to calculate payments under subdivision 3. The commissioner of human services shall
151.33certify the nonfederal out-of-home placement costs for the three prior calendar years for
151.34each county and the amount of any federal reimbursement received by a tribe under the
152.1ICWA for the three prior calendar years to the commissioner of revenue by June 1 of the
152.2year before the aid payment.
152.3    Subd. 3. Aid for counties. For aids payable in calendar year 2018 and thereafter, the
152.4amount of reimbursement to each county is a county's proportionate share of the appropriation
152.5in subdivision 6 that remains after the aid for tribes has been paid. Each county's
152.6proportionate share is based on the county's average nonfederal share of the cost for
152.7out-of-home placement of children under the ICWA for the three calendar years that were
152.8certified by the commissioner of human services by June 1 of the prior year, provided that
152.9the commissioner of human services, in consultation with the commissioner of corrections,
152.10certifies to the commissioner of revenue that accurate data are available to make the aid
152.11determination under this section. For aids payable in calendar year 2018, each county's
152.12proportionate share is based on the county's nonfederal share of the cost for out-of-home
152.13placement of children under the ICWA that was certified by the commissioner of human
152.14services by July 15, 2017.
152.15    Subd. 4. Aid for tribes. For aids payable in 2018 and thereafter, the amount of
152.16reimbursement to each tribe shall be the greater of:
152.17(1) five percent of the average reimbursement amount received from the federal
152.18government for out-of-home placement costs for the three calendar years that were certified
152.19by June 1 of the prior year; or
152.20(2) $200,000.
152.21    Subd. 5. Payments. The commissioner of revenue must compute the amount of the
152.22reimbursement aid payable to each county and tribe under this section. On or before August
152.231 of each year, the commissioner shall certify the amount to be paid to each county and
152.24tribe in the following year. The commissioner shall pay reimbursement aid annually at the
152.25times provided in section 477A.015.
152.26    Subd. 6. Appropriation. $10,000,000 is annually appropriated to the commissioner of
152.27revenue from the general fund to pay aid under this section.
152.28EFFECTIVE DATE.This section is effective beginning with aids payable in 2018.

152.29    Sec. 19. Minnesota Statutes 2016, section 477A.013, subdivision 8, is amended to read:
152.30    Subd. 8. City formula aid. (a) For aids payable in 2015 2018 and thereafter, the formula
152.31aid for a city is equal to the sum of (1) its formula aid in the previous year and (2) the product
152.32of (i) the difference between its unmet need and its formula certified aid in the previous
152.33year before any aid adjustment under subdivision 13, and (ii) the aid gap percentage.
153.1    (b) For aids payable in 2015 and thereafter, if a city's certified aid from the previous
153.2year is greater than the sum of its unmet need plus its aid adjustment under subdivision 13,
153.3its formula aid is adjusted to equal its unmet need.
153.4    (c) (b) No city may have a formula aid amount less than zero. The aid gap percentage
153.5must be the same for all cities subject to paragraph (a).
153.6    (d) (c) The applicable aid gap percentage must be calculated by the Department of
153.7Revenue so that the total of the aid under subdivision 9 equals the total amount available
153.8for aid under section 477A.03. The aid gap percentage must be the same for all cities subject
153.9to paragraph (a). Data used in calculating aids to cities under sections 477A.011 to 477A.013
153.10shall be the most recently available data as of January 1 in the year in which the aid is
153.11calculated.
153.12EFFECTIVE DATE.This section is effective for aids payable in calendar year 2018
153.13and thereafter.

153.14    Sec. 20. [477A.0135] AID REDUCTIONS FOR PAYMENTS TO A WORLD FAIR
153.15OR EXPO.
153.16If a county, statutory or home rule charter city, or town makes a payment or contribution
153.17to Expo2023 or any similar organization with the mission of advocating, promoting, or
153.18running a world fair or expo in the state of Minnesota in any year, it must report that amount
153.19to the commissioner by January 15 of the year following the year in which the payment or
153.20contribution is made. The commissioner shall reduce the aid paid to a county, city, or town
153.21under section 477A.014 from the amount certified to the county under section 477A.0124;
153.22to the city under section 477A.013, subdivision 9; or to the town under section 477A.013,
153.23subdivision 1, in the calendar year following the year in which the payment or contribution
153.24was made. The reduction is equal to the amount of the payment or contribution, but the aid
153.25paid to any county, city, or town may not be less than zero. Any savings in aid payments
153.26under this section shall stay in the general fund and shall not be redistributed to other
153.27counties, cities, or towns.
153.28EFFECTIVE DATE.This section is effective for aids payable in calendar year 2018
153.29and thereafter.

154.1    Sec. 21. [477A.0175] AID REDUCTIONS FOR OPERATING AN UNAUTHORIZED
154.2DIVERSION PROGRAM.
154.3    Subdivision 1. Penalty for operating an unauthorized diversion program.
154.4Notwithstanding any other law to the contrary, a county or city that operated a pretrial
154.5diversion program that a court determines was not authorized under section 169.999 or
154.6another statute or law must have its aid under sections 477A.011 to 477A.03 reduced by
154.7the amount of fees paid by participants into the program for the years in which the program
154.8operated. A court shall report any order that enjoins a county or city from operating a pretrial
154.9diversion program to the commissioner as required under subdivision 2. The commissioner
154.10shall, with the assistance of the state auditor, determine the amount of fees collected under
154.11the diversion program and reduce the county program aid paid to a county or the local
154.12government aid paid to a city by this amount beginning with the first aid payment made
154.13after the reduction amount is determined. No aid payment may be less than zero but the
154.14amount of the reduction that cannot be made out of that payment shall be applied to future
154.15payments until the total amount has been deducted.
154.16    Subd. 2. Court challenge to authority to operate a pretrial diversion program. Any
154.17taxpayer may challenge a city or county operation of a pretrial diversion program by filing
154.18a declaratory judgment action or seeking other appropriate relief in the district court for the
154.19county where the city is located or in any other court of competent jurisdiction. If the court
154.20finds that the county or city has exceeded its authority under law in operating the pretrial
154.21diversion program, the court must transmit a copy of the court order to the commissioner
154.22of revenue.
154.23EFFECTIVE DATE.This section is effective the day following final enactment and
154.24applies beginning with the second aid payments under Minnesota Statutes, section 477A.015
154.25in calendar year 2017.

154.26    Sec. 22. Minnesota Statutes 2016, section 477A.03, subdivision 2a, is amended to read:
154.27    Subd. 2a. Cities. The total aid paid under section 477A.013, subdivision 9, is
154.28$516,898,012 $519,398,012 for aids payable in 2015 2017. For aids payable in 2016 2018
154.29and thereafter, the total aid paid under section 477A.013, subdivision 9, is $519,398,012
154.30$586,848,950.

154.31    Sec. 23. Minnesota Statutes 2016, section 477A.03, subdivision 2b, is amended to read:
154.32    Subd. 2b. Counties. (a) For aids payable in 2014 and thereafter 2018 through 2024, the
154.33total aid payable under section 477A.0124, subdivision 3, is $100,795,000 $111,526,935,
155.1of which $3,000,000 shall be allocated as required under Laws 2014, chapter 150, article
155.24, section 6. For aids payable in 2025 and thereafter, the total aid payable under section
155.3477A.0124, subdivision 3, is $108,526,935. Each calendar year, $500,000 of this
155.4appropriation shall be retained by the commissioner of revenue to make reimbursements to
155.5the commissioner of management and budget for payments made under section 611.27. The
155.6reimbursements shall be to defray the additional costs associated with court-ordered counsel
155.7under section 611.27. Any retained amounts not used for reimbursement in a year shall be
155.8included in the next distribution of county need aid that is certified to the county auditors
155.9for the purpose of property tax reduction for the next taxes payable year.
155.10    (b) For aids payable in 2014 2018 and thereafter, the total aid under section 477A.0124,
155.11subdivision 4
, is $104,909,575 $137,641,510. The commissioner of revenue shall transfer
155.12to the commissioner of management and budget $207,000 annually for the cost of preparation
155.13of local impact notes as required by section 3.987, and other local government activities.
155.14The commissioner of revenue shall transfer to the commissioner of education $7,000 annually
155.15for the cost of preparation of local impact notes for school districts as required by section
155.163.987 . The commissioner of revenue shall deduct the amounts transferred under this
155.17paragraph from the appropriation under this paragraph. The amounts transferred are
155.18appropriated to the commissioner of management and budget and the commissioner of
155.19education respectively.

155.20    Sec. 24. Minnesota Statutes 2016, section 477A.03, subdivision 2c, is amended to read:
155.21    Subd. 2c. Towns. For aids payable in 2015 and thereafter 2017, the total aids paid under
155.22section 477A.013, subdivision 1, is limited to $10,000,000. For aids payable in 2018 and
155.23thereafter, the total aids paid under section 477A.013, subdivision 1, is limited to
155.24$15,000,000.
155.25EFFECTIVE DATE.This section is effective for aids payable in calendar year 2018
155.26and thereafter.

155.27    Sec. 25. [477A.09] MAXIMUM EFFORT LOAN AID.
155.28(a) For fiscal years 2018 to 2022, each school district with a maximum effort loan under
155.29sections 126C.61 to 126C.72, outstanding as of June 30, 2016, is eligible for an aid payment
155.30equal to one-fifth of the amount of interest that was paid on the loan between December 1,
155.311990, and June 30, 2016. A school district with a maximum effort capital loan outstanding
155.32as of June 30, 2017, is eligible for an annual aid payment equal to one-fifth of the estimated
155.33amount of interest that will be paid by the district on the loan between June 30, 2017, and
156.1June 30, 2021. Aid payments under this section must be used to reduce current year property
156.2taxes levied on net tax capacity within the district or to reduce future years' tax levies by:
156.3(1) retaining payments made under this section in the district's debt redemption fund for
156.4up to 20 years, notwithstanding the two-year limit under section 475.61, subdivision 3; or
156.5(2) financing a defeasance of any future payments on outstanding bonded debt.
156.6(b) Aid under this section must be paid in fiscal years 2018 to 2022. An amount sufficient
156.7to make aid payments under this section is annually appropriated from the general fund to
156.8the commissioner of education.
156.9EFFECTIVE DATE.This section is effective for fiscal years 2018 to 2022.

156.10    Sec. 26. [477A.21] RIPARIAN PROTECTION AID.
156.11    Subdivision 1. Definition. (a) For purposes of this section, the following terms have the
156.12meanings given.
156.13(b) "Buffer protection map" means the buffer protection map as defined in section
156.14103F.48, subdivision 1.
156.15(c) "Commissioner" means the commissioner of revenue.
156.16    Subd. 2. Certification to commissioner. (a) The Board of Water and Soil Resources
156.17must certify to the commissioner by September 1, 2017, and by July 1 of each year thereafter,
156.18which counties and watershed districts have affirmed their jurisdiction under section 103F.48,
156.19and the proportion of the number of centerline miles of public watercourses, and the miles
156.20of public drainage system ditches on the buffer protection map, within each county and
156.21each watershed district within the county with affirmed jurisdiction.
156.22(b) On or before July 1 of each year, the commissioner of natural resources shall certify
156.23to the commissioner the statewide and countywide number of centerline miles of public
156.24watercourses and the miles of public drainage system ditches on the buffer protection map.
156.25    Subd. 3. Distribution. (a) A county that is certified under subdivision 2, or that portion
156.26of a county containing a watershed district certified under subdivision 2, is eligible to receive
156.27aid under this section to enforce and implement the riparian protection and water quality
156.28practices under section 103F.48. The commissioner shall calculate a preliminary aid for all
156.29counties that shall equal the sum of (1) the total number of acres in the county classified as
156.30class 2a under section 273.13, subdivision 23; (2) the countywide number of centerline
156.31miles of public watercourses on the buffer protection map; and (3) the countywide number
156.32of miles of public drainage system on the buffer protection map; divided by the sum of (4)
157.1the statewide total number of acres classified as class 2a under section 273.13, subdivision
157.223; (5) the statewide total number of centerline miles of public watercourses on the buffer
157.3protection map; and (6) the statewide total number of miles of public drainage system on
157.4the buffer protection map; multiplied by (7) $10,000,000.
157.5(b) Aid to a county shall not be greater than $200,000 or less than $50,000. If the sum
157.6of the preliminary aids payable to counties under paragraph (a) is greater or less than the
157.7appropriation under subdivision 5, the commissioner shall calculate the percentage adjustment
157.8necessary so that the total of the aid under paragraph (a) equals the total amount available
157.9for aid under subdivision 5.
157.10(c) If only a portion of a county is certified as eligible to receive aid under subdivision
157.112, the aid otherwise payable to that county under this section shall be multiplied by a fraction,
157.12the numerator of which is the area of the certified watershed districts contained within the
157.13county and the denominator of which is the total area of the county.
157.14(d) Any aid that would otherwise be paid to a county or portion of a county that is not
157.15certified under subdivision 2 shall be paid to the Board of Water and Soil Resources for the
157.16purpose of enforcing and implementing the riparian protection and water quality practices
157.17under section 103F.48.
157.18    Subd. 4. Payments. The commissioner of revenue must compute the amount of riparian
157.19protection aid payable to each eligible county and to the Board of Water and Soil Resources
157.20under this section. On or before November 1, 2017, and on or before each August 1 thereafter,
157.21the commissioner shall certify the amount to be paid to each county and the Board of Water
157.22and Soil Resources in the following year. The commissioner shall pay riparian protection
157.23aid to counties and the Board of Water and Soil Resources in the same manner and at the
157.24same time as aid payments under section 477A.015.
157.25    Subd. 5. Appropriation. $10,000,000 is annually appropriated from the general fund
157.26to the commissioner to make the payments required under this section.
157.27EFFECTIVE DATE.This section is effective beginning with aids payable in 2018.

157.28    Sec. 27. ONETIME ADJUSTMENT FOR CERTAIN CITIES; AIDS PAYABLE IN
157.292017.
157.30(a) The amount of aid payable in 2017 to a city shall be increased to equal the amount
157.31of aid it received under Minnesota Statutes, section 477A.013, subdivision 9, for aids payable
157.32in 2016 if the following conditions are met:
158.1(1) its certified aid under Minnesota Statutes, section 477A.013, subdivision 9, for aids
158.2payable in 2017, is less than its certified aid for aids payable in 2016; and
158.3(2) its certified aid under Minnesota Statutes, section 477A.013, subdivision 9, for aids
158.4payable in 2016, is less than its unmet need under Minnesota Statutes, section 477A.011,
158.5subdivision 34, for aids payable in 2017.
158.6(b) Any adjustment under this section shall be treated as an aid correction under
158.7Minnesota Statutes, section 477A.014, subdivision 3. The amount computed under this
158.8section shall be used as an affected city's 2017 certified aid amount when calculating its
158.9formula aid under Minnesota Statutes, section 477A.013, subdivision 8, for aids payable in
158.102018.
158.11EFFECTIVE DATE.This section is effective for aids payable in calendar years 2017
158.12and 2018.

158.13    Sec. 28. BASE YEAR FORMULA AID FOR NEWLY INCORPORATED CITY.
158.14For a city that incorporated on October 13, 2015, and first qualifies for aid under
158.15Minnesota Statutes, section 477A.013, subdivisions 8 and 9, in 2017, the city's certified aid
158.16for 2017, used in calculating aid payable in 2018, shall be deemed to equal the lesser of (1)
158.1725 percent of its net levy for taxes payable in 2016, or (2) 50 percent of its unmet need as
158.18defined in Minnesota Statutes, section 477A.011, subdivision 43.
158.19EFFECTIVE DATE.This section is effective for aids payable in 2018.

158.20    Sec. 29. 2013 CITY AID PENALTY FORGIVENESS; CITY OF OSLO.
158.21Notwithstanding Minnesota Statutes, section 477A.017, subdivision 3, the city of Oslo
158.22shall receive the portion of its aid payment for calendar year 2013 under Minnesota Statutes,
158.23section 477A.013, that was withheld under Minnesota Statutes, section 477A.017, subdivision
158.243, provided that the state auditor certifies to the commissioner of revenue that it received
158.25audited financial statements from the city for calendar year 2012 by December 31, 2013.
158.26The commissioner of revenue shall make a payment of $37,473.50 with the first payment
158.27of aids under Minnesota Statutes, section 477A.015. $37,473.50 is appropriated from the
158.28general fund to the commissioner of revenue in fiscal year 2018 to make this payment.
158.29EFFECTIVE DATE.This section is effective the day following final enactment.

159.1    Sec. 30. 2014 AID PENALTY FORGIVENESS.
159.2(a) Notwithstanding Minnesota Statutes, section 477A.017, subdivision 3, the cities of
159.3Dundee, Jeffers, and Woodstock shall receive all of their calendar year 2014 aid payment
159.4that was withheld under Minnesota Statutes, section 477A.017, subdivision 3, provided that
159.5the state auditor certifies to the commissioner of revenue that the city complied with all
159.6reporting requirements under Minnesota Statutes, section 477A.017, subdivision 3, for
159.7calendar years 2013 and 2014 by June 1, 2015.
159.8(b) The commissioner of revenue shall make payment to each city no later than July 20,
159.92017. Up to $101,570 in fiscal year 2018 is appropriated from the general fund to the
159.10commissioner of revenue to make the payments under this section.
159.11EFFECTIVE DATE.This section is effective the day following final enactment.

159.12    Sec. 31. LAKE MILLE LACS AREA PROPERTY TAX ABATEMENT.
159.13    Subdivision 1. Abatements authorized. (a) Notwithstanding Minnesota Statutes, section
159.14375.192, the county boards of Aitkin, Crow Wing, and Mille Lacs Counties may grant an
159.15abatement of local property taxes for taxes payable in 2017, provided that:
159.16(1) the property is classified as 1c, 3a (excluding utility real and personal property),
159.174c(1), 4c(10), or 4c(11);
159.18(2) on or before December 31, 2017, the taxpayer submits a written application to the
159.19county auditor in the county in which abatement is sought; and
159.20(3) the taxpayer meets qualification requirements established in subdivision 3.
159.21    Subd. 2. Appeals. An appeal may not be taken to the Tax Court from any order of the
159.22county board made pursuant to the exercise of the discretionary authority granted in this
159.23section.
159.24    Subd. 3. Qualification requirements. To qualify for abatements under this section, a
159.25taxpayer must:
159.26(1) be located within one of the following municipalities surrounding Lake Mille Lacs:
159.27(i) in Crow Wing County, the city of Garrison, township of Garrison, or township of
159.28Roosevelt;
159.29(ii) in Aitkin County, the township of Hazelton, township of Wealthwood, township of
159.30Malmo, or township of Lakeside; or
160.1(iii) in Mille Lacs County, the city of Isle, city of Wahkon, city of Onamia, township of
160.2East Side, township of Isle Harbor, township of South Harbor, or township of Kathio;
160.3(2) document a reduction in gross receipts of five percent or greater between two
160.4successive calendar years beginning in 2010 or later; and
160.5(3) be a business in one of the following industries, as defined within the North American
160.6Industry Classification System: accommodation, restaurants, bars, amusement and recreation,
160.7food and beverages retail, sporting goods, miscellaneous retail, general retail, museums,
160.8historical sites, health and personal care, gas station, general merchandise, business and
160.9professional membership, movies, or nonstore retailer, as determined by the county in
160.10consultation with the commissioner of employment and economic development.
160.11    Subd. 4. State general levy in relief area. The counties of Aitkin, Crow Wing, and
160.12Mille Lacs must refund the state general levy levied upon a property classified as 1c, 3a
160.13(excluding utility real and personal property), or 4c(1) that is located in the area described
160.14by subdivision 3, clause (1), for taxes payable in 2017.
160.15    Subd. 5. Certification and transfer of funds. (a) By February 1, 2018, a county granting
160.16a refund as required under subdivision 4 must certify the total amount of state general tax
160.17refunded to Mille Lacs County and the commissioner of revenue. By March 1, 2018, Mille
160.18Lacs County must transfer an amount equal to the amount certified under this paragraph to
160.19the county making the certification.
160.20(b) By February 1, 2018, a county that has received an application for an abatement
160.21authorized under subdivision 1 must certify to Mille Lacs County the total amount of
160.22abatements for which applications have been received and approved. By March 1, 2018,
160.23Mille Lacs County must transfer an amount equal to the amount certified under this paragraph
160.24to the county making the certification. By April 30, 2018, the county must issue refunds of
160.25local property tax amounts to qualified taxpayers.
160.26    Subd. 6. Commissioner of revenue; appropriation. An amount sufficient to make the
160.27transfers required under subdivision 5 in fiscal year 2018 is appropriated from the general
160.28fund to the commissioner of revenue for transfer to Mille Lacs County. This is a onetime
160.29appropriation.
160.30    Subd. 7. Report to legislature. The commissioner of revenue must make a written report
160.31to the chairs and ranking minority members of the legislative committees with jurisdiction
160.32over taxes stating the amount of abatements and refunds given under this section by taxing
160.33jurisdictions by February 1, 2019. The counties must provide the commissioner with the
160.34information necessary to make the report.
161.1    Subd. 8. Refund eligibility. Only a taxpayer making all payments of property taxes for
161.2taxes payable in 2017 is eligible to receive a refund under subdivisions 4 and 5.
161.3EFFECTIVE DATE.This section is effective the day following final enactment.

161.4    Sec. 32. SUPPLEMENTAL PAYMENTS FOR OTHER NATURAL RESOURCES
161.5LAND.
161.6    Subdivision 1. Supplemental payments. For aids payable in calendar years 2017 and
161.72018 only, each county must receive a supplemental aid payment equal to 50 cents per acre
161.8for other natural resources land, as defined in Minnesota Statutes, section 477A.11,
161.9subdivision 4, located in the county. The payment shall be made at the same time as payments
161.10under Minnesota Statutes, section 477A.13, and the counties shall distribute this payment
161.11as if it was part of the aids subject to the general distribution for that year under Minnesota
161.12Statutes, section 477A.014, subdivision 1.
161.13    Subd. 2. Appropriation. The amount necessary to make the payments under subdivision
161.141 in each year is appropriated from the general fund to the commissioner of revenue for
161.15fiscal years 2018 and 2019 only. The appropriations under this section are onetime and not
161.16added to the base budget.
161.17EFFECTIVE DATE.This section is effective for aids payable in calendar years 2017
161.18and 2018 only.

161.19    Sec. 33. REPEALER.
161.20Minnesota Statutes 2016, section 477A.0124, subdivision 5, is repealed.

161.21ARTICLE 5
161.22IN PERPETUITY PAYMENTS ON LAND PURCHASES

161.23    Section 1. [11A.237] ACCOUNT FOR COUNTY JOINT TRUST FUND PAYMENTS.
161.24    Subdivision 1. Establishment. The State Board of Investment, when requested by a
161.25county as required under sections 97A.056, subdivision 1b, and 116P.045, subdivision 2,
161.26shall invest the funds deposited by the commissioner of revenue, acting as an agent on the
161.27board's behalf, under section 97A.056, subdivision 1b, or 116P.045, subdivision 2, in a
161.28special account for that purpose in the combined investment funds established in section
161.2911A.14, subject to the policy and procedures of the State Board of Investment. Use of the
161.30funds is restricted to payments to the commissioner of revenue, acting as an agent on behalf
162.1of the counties, for distributions to counties under sections 97A.056, subdivision 1b, and
162.2116P.045, subdivision 2.
162.3    Subd. 2. Account maintenance and investment. The commissioner of revenue may
162.4deposit money into the account on behalf of the counties and may withdraw money from
162.5the account to make distributions to the counties under sections 97A.056, subdivision 1b,
162.6and 116P.045, subdivision 2, only. The commissioner of revenue shall make one payment
162.7under each section each year for all counties eligible for a payment in that year. The
162.8commissioner shall make one withdrawal annually at a time negotiated with the executive
162.9director of the State Board of Investment, but no later than November 15, to cover
162.10distributions to counties under section 477A.30, up to the limit allowed under that section.
162.11The transactions must be in the manner required by the executive director of the State Board
162.12of Investment. Investment earnings must be credited to the account.
162.13EFFECTIVE DATE.This section is effective January 1, 2018.

162.14    Sec. 2. Minnesota Statutes 2016, section 97A.056, subdivision 1a, is amended to read:
162.15    Subd. 1a. Definitions. For the purpose of (a) The definitions in this subdivision apply
162.16to this section and appropriations from the outdoor heritage fund,.
162.17(b) "Land acquisition costs" means acquisition coordination costs, costs of engineering
162.18services, appraisal fees, attorney fees, taxes, assessments required at the time of purchase,
162.19onetime trust fund payments under subdivision 1b, and recording fees.
162.20(c) "Land-related property taxes" means property taxes collected on behalf of local
162.21governments providing land-related services.
162.22(d) "Local governments providing land-related services" means counties, townships,
162.23home rule charter and statutory cities, watershed districts under chapter 103D, sanitary
162.24districts under sections 442A.01 to 442A.29, and regional sanitary sewer districts under
162.25sections 115.61 to 115.67.
162.26(e) "Recipient" means the entity responsible for deliverables financed by the outdoor
162.27heritage fund.
162.28(f) "Total payment for the land" means the total price paid for the land including land
162.29acquisition costs, but excluding any in-kind services provided by nongovernmental entities
162.30at no cost to the state.
162.31EFFECTIVE DATE.This section is effective July 1, 2017.

163.1    Sec. 3. Minnesota Statutes 2016, section 97A.056, is amended by adding a subdivision to
163.2read:
163.3    Subd. 1b. Outdoor heritage trust fund payment account; trust fund payments. (a)
163.4An outdoor heritage trust fund account is created in the special revenue fund. The State
163.5Board of Investment must ensure the account is invested under section 11A.24. The
163.6commissioner of management and budget must credit to the account all money appropriated
163.7to the account and all money earned by the account. The principal of the account and any
163.8unexpended earnings must be invested and reinvested by the State Board of Investment.
163.9Nothing in this section limits the source of contributions to the account. Money in the
163.10account must be used only for the purposes of this subdivision.
163.11(b) State land acquired in fee simple in whole or in part with money appropriated from
163.12the outdoor heritage fund is eligible for a onetime trust fund payment as provided under
163.13this subdivision. The percentage of the total acres acquired in any purchase that is eligible
163.14for a trust fund payment under this subdivision is equal to the percentage of the total payment
163.15for the land funded from outdoor heritage fund revenues. If the percentage of the total
163.16payment for the land from the outdoor heritage fund is ten percent or less, the parcel is
163.17ineligible for a payment under this subdivision; if the percentage is 90 percent or more, the
163.18entire parcel is eligible for the payment under this subdivision. The commissioner of natural
163.19resources must certify to the commissioner of revenue and the county in which land eligible
163.20for a payment under this section is purchased the total number of acres purchased, the total
163.21payment for the land, and the amount of outdoor heritage fund revenues used for the purchase.
163.22The trust fund payment is equal to 30 times the land-related property taxes assessed on the
163.23eligible portion of the land in the year prior to the year in which the land is acquired. If the
163.24land was acquired from a private party that was exempt from paying property taxes, the
163.25payments must be based on 30 times the property taxes assessed on comparable land in the
163.26year prior to the year in which the land is acquired. By September 1 each year, the county
163.27in which the land is acquired must provide the commissioner of revenue with information
163.28necessary in a form determined by the commissioner of revenue to make this determination
163.29for all lands acquired for the 12-month period ending on June 30 of that year. The
163.30commissioner of revenue must make a trust fund payment on behalf of each county on the
163.31same date as the first payment under section 273.1384, subdivision 4, each year for all land
163.32acquired in that county in the 12-month period ending on June 30 of that year to the State
163.33Board of Investment as required under this paragraph. The money so deposited is money
163.34paid to the counties and may only be withdrawn for the purposes allowed under section
163.35477A.30. The commissioner of revenue must inform each county by October 15 each year
164.1of the amount deposited on the county's behalf with the State Board of Investment under
164.2this subdivision.
164.3(c) The amount necessary to make the payments required under this subdivision is
164.4annually appropriated from the outdoor heritage trust fund payment account to the
164.5commissioner of revenue for deposit in the account for county joint trust fund payments in
164.6section 11A.237.
164.7(d) To receive a trust fund payment under this subdivision, a county board must enter
164.8into an agreement with the State Board of Investment to allow the commissioner of revenue
164.9to make deposits and withdrawals on behalf of the county into and out of the county joint
164.10trust fund account under section 11A.237.
164.11(e) The portion of land receiving a trust fund payment under this subdivision is not
164.12eligible for payments under sections 477A.11 to 477A.14, but is eligible for distribution of
164.13withdrawals from the county joint trust fund account under section 477A.30.
164.14(f) If the land for which a payment under this subdivision is made is subsequently sold
164.15to another entity and is no longer available for the use for which it was purchased, the
164.16original amount of the payment for that land under paragraph (b) must be withdrawn by the
164.17commissioner of revenue from the account established under section 11A.237 and returned
164.18to the outdoor heritage fund. If only a portion of the land is sold and no longer available for
164.19the use for which it was purchased, the amount of the original trust fund payment returned
164.20is reduced proportionately based on the portion of the original purchase that is sold. The
164.21holder of the land must inform the commissioner of revenue and the county in which the
164.22land is sold of the sale and provide them with any information necessary to calculate the
164.23required withdrawal from the account. The withdrawal is made along with withdrawals
164.24under section 477A.30 in the calendar year after the year in which the land is sold.
164.25EFFECTIVE DATE.This section is effective July 1, 2017, and applies to land acquired
164.26with money appropriated on or after that date.

164.27    Sec. 4. Minnesota Statutes 2016, section 97A.056, subdivision 3, is amended to read:
164.28    Subd. 3. Council recommendations. (a) The council shall make recommendations to
164.29the legislature on appropriations of money from the outdoor heritage fund that are consistent
164.30with the Constitution and state law and that will achieve the outcomes of existing natural
164.31resource plans, including, but not limited to, the Minnesota Statewide Conservation and
164.32Preservation Plan, that directly relate to the restoration, protection, and enhancement of
164.33wetlands, prairies, forests, and habitat for fish, game, and wildlife, and that prevent forest
165.1fragmentation, encourage forest consolidation, and expand restored native prairie. In making
165.2recommendations, the council shall consider a range of options that would best restore,
165.3protect, and enhance wetlands, prairies, forests, and habitat for fish, game, and wildlife.
165.4The council recommendations each year on appropriation of money from the outdoor heritage
165.5fund must include amounts adequate to make the required transfers to the outdoor heritage
165.6trust fund payment account according to subdivision 1b. The council's recommendations
165.7shall be submitted no later than January 15 each year. The council shall present its
165.8recommendations to the senate and house of representatives committees with jurisdiction
165.9over the environment and natural resources budget by February 15 in odd-numbered years,
165.10and within the first four weeks of the legislative session in even-numbered years. The
165.11council's budget recommendations to the legislature shall be separate from the Department
165.12of Natural Resource's budget recommendations.
165.13    (b) To encourage and support local conservation efforts, the council shall establish a
165.14conservation partners program. Local, regional, state, or national organizations may apply
165.15for matching grants for restoration, protection, and enhancement of wetlands, prairies,
165.16forests, and habitat for fish, game, and wildlife, prevention of forest fragmentation,
165.17encouragement of forest consolidation, and expansion of restored native prairie.
165.18    (c) The council may work with the Clean Water Council to identify projects that are
165.19consistent with both the purpose of the outdoor heritage fund and the purpose of the clean
165.20water fund.
165.21    (d) The council may make recommendations to the Legislative-Citizen Commission on
165.22Minnesota Resources on scientific research that will assist in restoring, protecting, and
165.23enhancing wetlands, prairies, forests, and habitat for fish, game, and wildlife, preventing
165.24forest fragmentation, encouraging forest consolidation, and expanding restored native prairie.
165.25    (e) Recommendations of the council, including approval of recommendations for the
165.26outdoor heritage fund, require an affirmative vote of at least nine members of the council.
165.27(f) The council may work with the Clean Water Council, the Legislative-Citizen
165.28Commission on Minnesota Resources, the Board of Water and Soil Resources, soil and
165.29water conservation districts, and experts from Minnesota State Colleges and Universities
165.30and the University of Minnesota in developing the council's recommendations.
165.31(g) The council shall develop and implement a process that ensures that citizens and
165.32potential recipients of funds are included throughout the process, including the development
165.33and finalization of the council's recommendations. The process must include a fair, equitable,
166.1and thorough process for reviewing requests for funding and a clear and easily understood
166.2process for ranking projects.
166.3(h) The council shall use the regions of the state based upon the ecological sections and
166.4subsections developed by the Department of Natural Resources and establish objectives for
166.5each region and subregion to achieve the purposes of the fund outlined in the state
166.6constitution.
166.7(i) The council shall develop and submit to the Legislative Coordinating Commission
166.8plans for the first ten years of funding, and a framework for 25 years of funding, consistent
166.9with statutory and constitutional requirements. The council may use existing plans from
166.10other legislative, state, and federal sources, as applicable.
166.11EFFECTIVE DATE.This section is effective July 1, 2017, and applies to lands acquired
166.12with money appropriated on or after that date.

166.13    Sec. 5. Minnesota Statutes 2016, section 97A.056, is amended by adding a subdivision to
166.14read:
166.15    Subd. 15a. State acquisition of land; restrictions. The state may not use money from
166.16the outdoor heritage fund to acquire in fee simple in whole or in part any land subject to
166.17property taxes or any land owned by a nonprofit organization that was subject to property
166.18taxes before the land's acquisition by the nonprofit organization if (1) subdivision 1b is void,
166.19or (2) sufficient funds to cover the onetime trust fund payment required under subdivision
166.201b have not been appropriated or are not available.
166.21EFFECTIVE DATE.This section is effective July 1, 2017, and applies to land acquired
166.22with money appropriated on or after that date.

166.23    Sec. 6. Minnesota Statutes 2016, section 116P.02, subdivision 1, is amended to read:
166.24    Subdivision 1. Applicability. The definitions in this section apply to this chapter, except
166.25that the definition in subdivision 6 does not apply to section 116P.045.
166.26EFFECTIVE DATE.This section is effective July 1, 2017.

166.27    Sec. 7. Minnesota Statutes 2016, section 116P.02, is amended by adding a subdivision to
166.28read:
166.29    Subd. 4a. Land acquisition costs. "Land acquisition costs" means acquisition
166.30coordination costs, costs of engineering services, appraisal fees, attorney fees, taxes,
167.1assessments required at the time of purchase, payments under section 116P.045, and recording
167.2fees.
167.3EFFECTIVE DATE.This section is effective July 1, 2017.

167.4    Sec. 8. Minnesota Statutes 2016, section 116P.02, is amended by adding a subdivision to
167.5read:
167.6    Subd. 4b. Land-related property taxes. "Land-related property taxes" means property
167.7taxes collected on behalf of local governments providing land-related services.
167.8EFFECTIVE DATE.This section is effective July 1, 2017.

167.9    Sec. 9. Minnesota Statutes 2016, section 116P.02, is amended by adding a subdivision to
167.10read:
167.11    Subd. 4c. Local governments providing land-related services. "Local governments
167.12providing land-related services" means counties, townships, home rule charter and statutory
167.13cities, watershed districts under chapter 103D, sanitary districts under sections 442A.01 to
167.14442A.29, and regional sanitary sewer districts under sections 115.61 to 115.67.
167.15EFFECTIVE DATE.This section is effective July 1, 2017.

167.16    Sec. 10. Minnesota Statutes 2016, section 116P.02, is amended by adding a subdivision
167.17to read:
167.18    Subd. 4d. Total payment for the land. "Total payment for the land" means the total
167.19price paid for the land including land acquisition costs, but excluding any in-kind services
167.20provided by nongovernmental entities at no cost to the state.
167.21EFFECTIVE DATE.This section is effective July 1, 2017.

167.22    Sec. 11. [116P.045] ENVIRONMENT AND NATURAL RESOURCES TRUST FUND
167.23PAYMENT ACCOUNT.
167.24    Subdivision 1. Account created. An environment and natural resources trust fund
167.25payment account is created in the special revenue fund. The State Board of Investment must
167.26ensure the account is invested under section 11A.24. The commissioner of management
167.27and budget must credit to the account all money appropriated to the account and all money
167.28earned by the account. The principal of the account and any unexpended earnings must be
167.29invested and reinvested by the State Board of Investment. Nothing in this section limits the
168.1source of contributions to the account. Money in the account must be used only for the
168.2purposes of this section.
168.3    Subd. 2. Trust fund payment; appropriation. (a) State land acquired in fee simple in
168.4whole or in part with money appropriated from the environment and natural resources trust
168.5fund is eligible for a onetime trust fund payment as provided under this subdivision. The
168.6percentage of the total acres acquired in any purchase that is eligible for a trust fund payment
168.7under this section is equal to the percentage of the total payment for the land funded from
168.8environment and natural resources trust fund revenues. If the percentage of the total payment
168.9for the land from the environment and natural resources trust fund is ten percent or less, the
168.10parcel is ineligible for a payment under this section; if the percentage is 90 percent or more,
168.11the entire parcel is eligible for the payment under this section. The commissioner of natural
168.12resources must certify to the commissioner of revenue and the county in which land eligible
168.13for a payment under this section is purchased the total number of acres purchased, the total
168.14payment for the land, and the amount of environmental and natural resources trust fund
168.15revenues used for the purchase. The trust fund payment is equal to 30 times the land-related
168.16property taxes assessed on the eligible portion of the land in the year prior to the year in
168.17which the land is acquired. If the land was acquired from a private party that was exempt
168.18from paying property taxes, the payments must be based on 30 times the property taxes
168.19assessed on comparable land in the year prior to the year in which the land is acquired. By
168.20September 1 each year, the county in which the land is acquired must provide the
168.21commissioner of revenue with information necessary in a form determined by the
168.22commissioner of revenue to make this determination for all lands acquired for the 12-month
168.23period ending on June 30 of that year. The commissioner of revenue must make a trust fund
168.24payment on behalf of each county on the same date as the first payment under section
168.25273.1384, subdivision 4, each year for all land acquired in that county in the 12-month
168.26period ending on June 30 of that year to the State Board of Investment as required under
168.27this section. The money so deposited is money paid to the counties and may only be
168.28withdrawn for the purposes allowed under section 477A.30. The commissioner of revenue
168.29must inform each county by October 15 each year of the amount deposited on the county's
168.30behalf with the State Board of Investment under this subdivision.
168.31(b) The amount necessary to make the payments required under this subdivision is
168.32annually appropriated from the environment and natural resources trust fund payment
168.33account to the commissioner of revenue for deposit in the account for county joint trust
168.34fund payments in section 11A.237.
169.1(c) If the land for which a payment under this subdivision is made is subsequently sold
169.2to another entity and is no longer available for the use for which it was purchased, the
169.3original amount of the payment for that land under paragraph (a) must be withdrawn by the
169.4commissioner of revenue from the account established under section 11A.237 and returned
169.5to the environment and natural resources trust fund. If only a portion of the land is sold and
169.6no longer available for the use for which it was purchased, the amount of the original trust
169.7fund payment returned is reduced proportionately based on the portion of the original
169.8purchase that is sold. The holder of the land must inform the commissioner of revenue and
169.9the county in which the land is sold of the sale and provide them with any information
169.10necessary to calculate the required withdrawal from the account. The withdrawal is made
169.11along with withdrawals under section 477A.30 in the calendar year after the year in which
169.12the land is sold.
169.13    Subd. 3. County requirements. To receive a trust fund payment under this section, a
169.14county board must enter into an agreement with the State Board of Investment to allow the
169.15commissioner of revenue to make deposits and withdrawals on behalf of the county into
169.16and out of the county joint trust fund account under section 11A.237.
169.17    Subd. 4. Ineligible for other payments. Land receiving a trust fund payment under this
169.18section is not eligible for payments under sections 477A.11 to 477A.14, but is eligible for
169.19distribution of withdrawals from the county joint trust fund account under section 477A.30.
169.20    Subd. 5. State acquisition of land; restrictions. The state may not use money from the
169.21environment and natural resources trust fund to acquire in fee simple in whole or in part
169.22any land subject to property taxes or any land owned by a nonprofit organization that was
169.23subject to property taxes before the land's acquisition by the nonprofit organization if (1)
169.24subdivision 2 is void, or (2) sufficient funds to cover the onetime trust fund payment required
169.25under subdivision 2 have not been appropriated or are not available.
169.26EFFECTIVE DATE.This section is effective July 1, 2017, and applies to land acquired
169.27with money appropriated on or after that date.

169.28    Sec. 12. Minnesota Statutes 2016, section 116P.08, subdivision 1, is amended to read:
169.29    Subdivision 1. Expenditures. Money in the trust fund may be spent only for:
169.30(1) the reinvest in Minnesota program as provided in section 84.95, subdivision 2;
169.31(2) research that contributes to increasing the effectiveness of protecting or managing
169.32the state's environment or natural resources;
170.1(3) collection and analysis of information that assists in developing the state's
170.2environmental and natural resources policies;
170.3(4) enhancement of public education, awareness, and understanding necessary for the
170.4protection, conservation, restoration, and enhancement of air, land, water, forests, fish,
170.5wildlife, and other natural resources;
170.6(5) capital projects for the preservation and protection of unique natural resources;
170.7(6) activities that preserve or enhance fish, wildlife, land, air, water, and other natural
170.8resources that otherwise may be substantially impaired or destroyed in any area of the state;
170.9(7) administrative and investment expenses incurred by the State Board of Investment
170.10in investing deposits to the trust fund; and
170.11(8) administrative expenses subject to the limits in section 116P.09.; and
170.12(9) payments to the environment and natural resources trust fund payment account as
170.13required in section 116P.045.
170.14EFFECTIVE DATE.This section is effective July 1, 2017, and applies to lands acquired
170.15with money appropriated on or after that date.

170.16    Sec. 13. Minnesota Statutes 2016, section 116P.08, subdivision 4, is amended to read:
170.17    Subd. 4. Legislative recommendations. (a) Funding may be provided only for those
170.18projects that meet the categories established in subdivision 1.
170.19(b) The commission must recommend an annual or biennial legislative bill to make
170.20appropriations from the trust fund for the purposes provided in subdivision 1. The
170.21recommendations must be submitted to the governor for inclusion in the biennial budget
170.22and supplemental budget submitted to the legislature.
170.23(c) The commission may recommend regional block grants for a portion of trust fund
170.24expenditures to partner with existing regional organizations that have strong citizen
170.25involvement, to address unique local needs and capacity, and to leverage all available funding
170.26sources for projects.
170.27(d) The commission may recommend the establishment of an emerging issues account
170.28in its legislative bill for funding emerging issues, which come up unexpectedly, but which
170.29still adhere to the commission's strategic plan, to be approved by the governor after initiation
170.30and recommendation by the commission.
171.1(e) The council must recommend an appropriation of money from the environment and
171.2natural resources trust fund adequate to make the required transfers to the environment and
171.3natural resources trust fund payment account according to section 116P.045.
171.4(f) Money in the trust fund may not be spent except under an appropriation by law.
171.5EFFECTIVE DATE.This section is effective July 1, 2017, and applies to lands acquired
171.6with money appropriated on or after that date.

171.7    Sec. 14. Minnesota Statutes 2016, section 477A.10, is amended to read:
171.8477A.10 NATURAL RESOURCES LAND PAYMENTS IN LIEU; PURPOSE.
171.9The purposes of sections 477A.11 to 477A.14 are:
171.10(1) to compensate local units of government for the loss of tax base from state ownership
171.11of land, except land acquired on or after July 1, 2017, receiving trust fund payments from
171.12the outdoor heritage trust fund payment account or the environment and natural resources
171.13trust fund payment account, and the need to provide services for state land;
171.14(2) to address the disproportionate impact of state land ownership on local units of
171.15government with a large proportion of state land; and
171.16(3) to address the need to manage state lands held in trust for the local taxing districts.
171.17EFFECTIVE DATE.This section is effective the day following final enactment.

171.18    Sec. 15. Minnesota Statutes 2016, section 477A.11, is amended by adding a subdivision
171.19to read:
171.20    Subd. 9. Environment and natural resources trust fund lands. Notwithstanding any
171.21other provision of law to the contrary, parcels or portions of parcels of land purchased on
171.22or after July 1, 2017, and eligible for a trust fund payment under section 116P.045 are not
171.23included in the definitions of the lands described in subdivisions 3 to 7 and are excluded
171.24from payments under sections 477A.11 to 477A.14.
171.25EFFECTIVE DATE.This section is effective beginning with aids payable in 2018.

171.26    Sec. 16. Minnesota Statutes 2016, section 477A.11, is amended by adding a subdivision
171.27to read:
171.28    Subd. 10. Outdoor heritage lands. Notwithstanding any other provision of law to the
171.29contrary, parcels or portions of parcels of land purchased on or after July 1, 2017, and
171.30eligible for a trust fund payment under section 97A.056, subdivision 1b, are not included
172.1in the definitions of the lands described in subdivisions 3 to 7 and are excluded from
172.2payments under sections 477A.11 to 477A.14.
172.3EFFECTIVE DATE.This section is effective beginning with aids payable in 2018.

172.4    Sec. 17. [477A.30] ANNUAL COUNTY JOINT TRUST FUND WITHDRAWALS
172.5AND DISTRIBUTION FOR ENVIRONMENT AND NATURAL RESOURCES
172.6TRUST FUND LANDS AND OUTDOOR HERITAGE LANDS.
172.7    Subdivision 1. Commissioner of revenue; withdrawals and payments. No later than
172.8November 15 each year, the commissioner of revenue shall make a withdrawal on behalf
172.9of all eligible counties from the county joint trust fund account established under section
172.1011A.237 equal to the lesser of (1) the total amount of necessary withdrawals certified by
172.11the counties under subdivision 2 for the year, or (2) 5-1/2 percent of the amount in that
172.12account as of September 1 of that year as determined by the executive director of the State
172.13Board of Investment. The commissioner shall distribute the certified withdrawal amounts
172.14to each county by November 30. If the amount of the withdrawal is less than the total
172.15certified withdrawal amounts under subdivision 2, the commissioner shall reduce the
172.16distribution to each county proportionately.
172.17    Subd. 2. Certification of needed withdrawal; distribution of funds. (a) Beginning in
172.18calendar year 2018, by September 1 each year, a county for whom a trust fund payment has
172.19been made on its behalf under section 97A.056, subdivision 1b, or 116P.045, subdivision
172.202, shall calculate and certify to the commissioner of revenue the amount of trust fund
172.21withdrawals needed under this section. The amount of the withdrawal for each parcel of
172.22land for which a county received a trust fund payment under either provision is as follows:
172.23(1) for the year in which a trust fund payment is made to a county for a parcel of land,
172.24the withdrawal for that parcel is equal to:
172.25(i) the remaining taxes owed to the local governments providing land-related services
172.26for taxes spread that year for a parcel acquired between January 1 and June 30; or
172.27(ii) the amount of taxes paid to the local governments providing land-related services
172.28on the parcel in the previous year if the parcel was acquired before January 1 of the current
172.29year. The county must distribute the amount by December 15 to all local governments
172.30providing land-related services based on the location of the parcel and the local governments'
172.31share of the total tax; and
172.32(2) for all subsequent years, the withdrawal for a parcel is equal to the taxes that would
172.33be owed based on the appraised value of the land and the taxes assessed by local governments
173.1providing land-related services on comparable, privately owned adjacent land. For purposes
173.2of this subdivision, "appraised value" is determined in the manner described in section
173.3477A.12, subdivision 3. The county treasurer must allocate the withdrawn funds among the
173.4local governments providing land-related services on the same basis as if the funds were
173.5taxes on the land received in that year. The county treasurer must pay the allocation to all
173.6eligible local governments by December 15 of the year in which the withdrawal is made.
173.7The county's share of the payment must be deposited in the county general fund.
173.8(b) If the distribution to a county under subdivision 1 is less than its total withdrawal
173.9amounts certified under this subdivision, all distributions under paragraph (a) are reduced
173.10proportionately.
173.11(c) The local governments receiving a payment under this section must use the money
173.12to fund land-related services. For purposes of this paragraph, "land-related services" means
173.13services used to restore, enhance, and protect the land and its fish and wildlife habitat and
173.14provide any other public services benefiting the land and users of the land, including access
173.15and services to the public accessing and using the land and direct and indirect capital and
173.16operating costs for (1) roads, bridges, and trails; (2) public safety and emergency response
173.17services; (3) environmental, recreational, and resource development and management; and
173.18(4) similar costs.
173.19(d) For purposes of this subdivision, "local governments providing land-related services"
173.20has the meaning given in section 116P.02, subdivision 4c.
173.21EFFECTIVE DATE.This section is effective January 1, 2018, and applies to land
173.22acquired with money appropriated on or after July 1, 2017.

173.23    Sec. 18. DELAYED REQUIREMENT FOR TRUST FUND PAYMENTS FOR
173.24APPROPRIATIONS MADE FOR FISCAL YEAR 2018.
173.25(a) Notwithstanding Minnesota Statutes, section 97A.056, subdivision 15a, the state
173.26may appropriate money for fiscal year 2018 from the outdoor heritage fund to purchase
173.27land without appropriating sufficient funds to cover the onetime trust fund payment required
173.28under Minnesota Statutes, section 97A.056, subdivision 1b. The amount necessary to make
173.29the payment required under Minnesota Statutes, section 97A.056, subdivision 1b, for all
173.30fiscal year 2018 appropriations for land purchases must be deposited in the outdoor heritage
173.31trust fund payment account by August 1, 2018, or the restriction on land acquisition under
173.32Minnesota Statutes, section 97A.056, subdivision 15a, applies to any land acquisition
173.33authorized with fiscal year 2018 funds that have not yet been acquired.
174.1(b) Notwithstanding Minnesota Statutes, section 116P.045, subdivision 5, the state may
174.2appropriate money in fiscal year 2018 from the environment and natural resources trust
174.3fund to purchase land without appropriating sufficient funds to cover the onetime trust fund
174.4payment required under Minnesota Statutes, section 116P.045, subdivision 2. The amount
174.5necessary to make the payment required under Minnesota Statutes, section 116P.045,
174.6subdivision 2, for all fiscal year 2018 appropriations for land purchases must be deposited
174.7in the environment and natural resources trust fund payment account by August 1, 2018, or
174.8the restriction on land acquisition under Minnesota Statutes, section 116P.045, subdivision
174.95, applies to any land acquisition authorized with fiscal year 2018 funds that have not yet
174.10been acquired.
174.11EFFECTIVE DATE.This section is effective the day following final enactment.

174.12ARTICLE 6
174.13LOCAL OPTION SALES AND USE TAXES

174.14    Section 1. Laws 1980, chapter 511, section 1, subdivision 2, as amended by Laws 1991,
174.15chapter 291, article 8, section 22, Laws 1998, chapter 389, article 8, section 25, Laws 2003,
174.16First Special Session chapter 21, article 8, section 11, Laws 2008, chapter 154, article 5,
174.17section 2, and Laws 2014, chapter 308, article 3, section 21, is amended to read:
174.18    Subd. 2. (a) Notwithstanding Minnesota Statutes, section 477A.016, or any other law,
174.19ordinance, or city charter provision to the contrary, the city of Duluth may, by ordinance,
174.20impose an additional sales tax of up to one and three-quarter percent on sales transactions
174.21which are described in Minnesota Statutes 2000, section 297A.01, subdivision 3, clause (c).
174.22The imposition of this tax shall not be subject to voter referendum under either state law or
174.23city charter provisions. When the city council determines that the taxes imposed under this
174.24paragraph at a rate of three-quarters of one percent and other sources of revenue produce
174.25revenue sufficient to pay debt service on bonds in the principal amount of $40,285,000 plus
174.26issuance and discount costs, issued for capital improvements at the Duluth Entertainment
174.27and Convention Center, which include a new arena, the rate of tax under this subdivision
174.28must be reduced by three-quarters of one percent.
174.29(b) In addition to the tax in paragraph (a) and notwithstanding Minnesota Statutes, section
174.30477A.016 , or any other law, ordinance, or city charter provision to the contrary, the city of
174.31Duluth may, by ordinance, impose an additional sales tax of up to one-half of one percent
174.32on sales transactions which are described in Minnesota Statutes 2000, section 297A.01,
174.33subdivision 3, clause (c). This tax expires when the city council determines that the tax
174.34imposed under this paragraph, along with the tax imposed under section 22, paragraph (b),
175.1has produced revenues sufficient to pay the debt service on bonds in a principal amount of
175.2no more than $18,000,000, plus issuance and discount costs, to finance capital improvements
175.3to public facilities to support tourism and recreational activities in that portion of the city
175.4west of 34th 14th Avenue West and the area south of and including Skyline Parkway.
175.5(c) The city of Duluth may sell and issue up to $18,000,000 in general obligation bonds
175.6under Minnesota Statutes, chapter 475, plus an additional amount to pay for the costs of
175.7issuance and any premiums. The proceeds may be used to finance capital improvements to
175.8public facilities that support tourism and recreational activities in the portion of the city
175.9west of 34th 14th Avenue West and the area south of and including Skyline Parkway, as
175.10described in paragraph (b). The issuance of the bonds is subject to the provisions of
175.11Minnesota Statutes, chapter 475, except no election shall be required unless required by the
175.12city charter. The bonds shall not be included in computing net debt. The revenues from the
175.13taxes that the city of Duluth may impose under paragraph (b) and under section 22, paragraph
175.14(b), may be pledged to pay principal of and interest on such bonds.
175.15EFFECTIVE DATE.This section is effective the day after the governing body of the
175.16city of Duluth and its chief clerical officer comply with Minnesota Statutes, section 645.021,
175.17subdivisions 2 and 3.

175.18    Sec. 2. Laws 1980, chapter 511, section 2, as amended by Laws 1998, chapter 389, article
175.198, section 26, Laws 2003, First Special Session chapter 21, article 8, section 12, and Laws
175.202014, chapter 308, article 3, section 22, is amended to read:
175.21    Sec. 22. CITY OF DULUTH; TAX ON RECEIPTS BY HOTELS AND MOTELS.
175.22    (a) Notwithstanding Minnesota Statutes, section 477A.016, or any other law, or ordinance,
175.23or city charter provision to the contrary, the city of Duluth may, by ordinance, impose an
175.24additional tax of one percent upon the gross receipts from the sale of lodging for periods of
175.25less than 30 days in hotels and motels located in the city. The tax shall be collected in the
175.26same manner as the tax set forth in the Duluth city charter, section 54(d), paragraph one.
175.27The imposition of this tax shall not be subject to voter referendum under either state law or
175.28city charter provisions.
175.29(b) In addition to the tax in paragraph (a) and notwithstanding Minnesota Statutes, section
175.30477A.016 , or any other law, ordinance, or city charter provision to the contrary, the city of
175.31Duluth may, by ordinance, impose an additional sales tax of up to one-half of one percent
175.32on the gross receipts from the sale of lodging for periods of less than 30 days in hotels and
175.33motels located in the city. This tax expires when the city council first determines that the
175.34tax imposed under this paragraph, along with the tax imposed under section 21, paragraph
176.1(b), has produced revenues sufficient to pay the debt service on bonds in a principal amount
176.2of no more than $18,000,000, plus issuance and discount costs, to finance capital
176.3improvements to public facilities to support tourism and recreational activities in that portion
176.4of the city west of 34th 14th Avenue West and the area south of and including Skyline
176.5Parkway.
176.6EFFECTIVE DATE.This section is effective the day after the governing body of the
176.7city of Duluth and its chief clerical officer comply with Minnesota Statutes, section 645.021,
176.8subdivisions 2 and 3.

176.9    Sec. 3. Laws 1991, chapter 291, article 8, section 27, subdivision 3, as amended by Laws
176.101998, chapter 389, article 8, section 28, Laws 2008, chapter 366, article 7, section 9, and
176.11Laws 2009, chapter 88, article 4, section 14, is amended to read:
176.12    Subd. 3. Use of revenues. (a) Revenues received from taxes authorized by subdivisions
176.131 and 2 shall be used by the city to pay the cost of collecting the tax and to pay all or a
176.14portion of the expenses of constructing and improving facilities as part of an urban
176.15revitalization project in downtown Mankato known as Riverfront 2000. Authorized expenses
176.16include, but are not limited to, acquiring property and paying relocation expenses related
176.17to the development of Riverfront 2000 and related facilities, and securing or paying debt
176.18service on bonds or other obligations issued to finance the construction of Riverfront 2000
176.19and related facilities. For purposes of this section, "Riverfront 2000 and related facilities"
176.20means a civic-convention center, an arena, a riverfront park, a technology center and related
176.21educational facilities, and all publicly owned real or personal property that the governing
176.22body of the city determines will be necessary to facilitate the use of these facilities, including
176.23but not limited to parking, skyways, pedestrian bridges, lighting, and landscaping. It also
176.24includes the performing arts theatre and the Southern Minnesota Women's Hockey Exposition
176.25Center, for use by Minnesota State University, Mankato.
176.26    (b) Notwithstanding Minnesota Statutes, section 297A.99, subdivision 3, and as approved
176.27by voters at the November 8, 2016, general election, the city may by ordinance also use
176.28revenues from taxes authorized under subdivisions 1 and 2, up to a maximum of $47,000,000,
176.29plus associated bond costs, to pay all or a portion of the expenses of the following capital
176.30projects:
176.31    (1) construction and improvements to regional recreational facilities including existing
176.32hockey and curling rinks, a baseball park, youth athletic fields and facilities, the municipal
176.33swimming pool including improvements to make the pool compliant with the Americans
176.34with Disabilities Act, and indoor regional athletic facilities;
177.1    (2) improvements to flood control and the levee system;
177.2(3) water quality improvement projects in Blue Earth and Nicollet Counties;
177.3(4) expansion of the regional transit building and related multimodal transit
177.4improvements;
177.5(5) regional public safety and emergency communications improvements and equipment;
177.6and
177.7(6) matching funds for improvements to publicly owned regional facilities including a
177.8historic museum, supportive housing, and a senior center.
177.9EFFECTIVE DATE.This section is effective the day after the governing body of the
177.10city of Mankato and its chief clerical officer comply with Minnesota Statutes, section
177.11645.021, subdivisions 2 and 3.

177.12    Sec. 4. Laws 1991, chapter 291, article 8, section 27, subdivision 4, as amended by Laws
177.132005, First Special Session chapter 3, article 5, section 25, and Laws 2008, chapter 366,
177.14article 7, section 10, is amended to read:
177.15    Subd. 4. Expiration of taxing authority and expenditure limitation. The authority
177.16granted by subdivisions 1 and 2 to the city to impose a sales tax and an excise tax shall
177.17expire on at the earlier of when revenues are sufficient to pay off the bonds, including
177.18interest and all other associated bond costs authorized under subdivision 5, or December
177.1931, 2022 2038.
177.20EFFECTIVE DATE.This section is effective the day following final enactment without
177.21local approval pursuant to Minnesota Statutes, section 645.023, subdivision 1.

177.22    Sec. 5. Laws 1991, chapter 291, article 8, section 27, subdivision 5, is amended to read:
177.23    Subd. 5. Bonds. (a) The city of Mankato may issue general obligation bonds of the city
177.24in an amount not to exceed $25,000,000 for Riverfront 2000 and related facilities, without
177.25election under Minnesota Statutes, chapter 475, on the question of issuance of the bonds or
177.26a tax to pay them. The debt represented by bonds issued for Riverfront 2000 and related
177.27facilities shall not be included in computing any debt limitations applicable to the city of
177.28Mankato, and the levy of taxes required by section 475.61 to pay principal of and interest
177.29on the bonds shall not be subject to any levy limitation or be included in computing or
177.30applying any levy limitation applicable to the city.
178.1    (b) The city of Mankato may issue general obligation bonds of the city in an amount not
178.2to exceed $47,000,000 for the projects listed under subdivision 3, paragraph (b), without
178.3election under Minnesota Statutes, chapter 475, on the question of issuance of the bonds or
178.4a tax to pay them. The debt represented by bonds under this paragraph shall not be included
178.5in computing any debt limitations applicable to the city of Mankato, and the levy of taxes
178.6required by Minnesota Statutes, section 475.61, to pay principal of and interest on the bonds,
178.7and shall not be subject to any levy limitation or be included in computing or applying any
178.8levy limitation applicable to the city. The city may use tax revenue in excess of one year's
178.9principal interest reserve for intended annual bond payments to pay all or a portion of the
178.10cost of capital improvements authorized in subdivision 3.
178.11EFFECTIVE DATE.This section is effective the day following final enactment without
178.12local approval pursuant to Minnesota Statutes, section 645.023, subdivision 1.

178.13    Sec. 6. Laws 1996, chapter 471, article 2, section 29, subdivision 1, as amended by Laws
178.142006, chapter 259, article 3, section 3, and Laws 2011, First Special Session chapter 7,
178.15article 4, section 4, is amended to read:
178.16    Subdivision 1. Sales tax authorized. (a) Notwithstanding Minnesota Statutes, section
178.17477A.016, or any other contrary provision of law, ordinance, or city charter, the city of
178.18Hermantown may, by ordinance, impose an additional sales tax of up to one percent on
178.19sales transactions taxable pursuant to Minnesota Statutes, chapter 297A, that occur within
178.20the city. The proceeds of the tax imposed under this section must be used to meet the costs
178.21of:
178.22    (1) extending a sewer interceptor line;
178.23    (2) construction of a booster pump station, reservoirs, and related improvements to the
178.24water system; and
178.25    (3) construction of a building containing a police and fire station and an administrative
178.26services facility.
178.27(b) If the city imposed a sales tax of only one-half of one percent under paragraph (a),
178.28it may increase the tax to one percent to fund the purposes under paragraph (a) provided it
178.29is approved by the voters at a general election held before December 31, 2012.
178.30(c) As approved by the voters at the November 8, 2016, general election, the proceeds
178.31under this section may also be used to meet the costs of debt service payments for
178.32construction of the Hermantown Wellness Center.
179.1EFFECTIVE DATE.This section is effective the day after the governing body of the
179.2city of Hermantown and its chief clerical officer comply with Minnesota Statutes, section
179.3645.021, subdivisions 2 and 3.

179.4    Sec. 7. Laws 1996, chapter 471, article 2, section 29, subdivision 4, as amended by Laws
179.52006, chapter 259, article 3, section 4, is amended to read:
179.6    Subd. 4. Termination. The tax authorized under this section terminates on March 31,
179.72026 at the earlier of (1) December 31, 2036, or (2) when the Hermantown City Council
179.8first determines that sufficient funds have been received from the tax to fund the costs,
179.9including bonds and associated bond costs for the uses specified in subdivision 1. Any funds
179.10remaining after completion of the improvements and retirement or redemption of the bonds
179.11may be placed in the general fund of the city.
179.12EFFECTIVE DATE.This section is effective the day following final enactment without
179.13local approval pursuant to Minnesota Statutes, section 645.023, subdivision 1.

179.14    Sec. 8. Laws 1999, chapter 243, article 4, section 17, subdivision 3, is amended to read:
179.15    Subd. 3. Use of revenues. (a) Revenues received from taxes authorized by subdivisions
179.161 and 2 must be used by the city to pay the cost of collecting the taxes and to pay for
179.17construction and improvement of a civic and community center and recreational facilities
179.18to serve all ages, including seniors and youth. Authorized expenses include, but are not
179.19limited to, acquiring property, paying construction and operating expenses related to the
179.20development of an authorized facility, funding facilities replacement reserves, and paying
179.21debt service on bonds or other obligations issued to finance the construction or expansion
179.22of an authorized facility. The capital expenses for all projects authorized under this
179.23subdivision that may be paid with these taxes are limited to $9,000,000, plus an amount
179.24equal to the costs related to issuance of the bonds and funding facilities replacement reserves.
179.25    (b) Notwithstanding Minnesota Statutes, section 297A.99, subdivision 3, and as approved
179.26by the voters at the November 8, 2016, general election, the city of New Ulm may by
179.27ordinance also use revenues from taxes authorized under subdivisions 1 and 2, up to a
179.28maximum of $14,800,000, plus associated bond costs, to pay all or a portion of the expenses
179.29of the following capital projects:
179.30    (1) constructing an indoor water park and making safety improvements to the existing
179.31recreational center pool;
179.32    (2) constructing an indoor playground, a wellness center, and a gymnastics facility;
180.1    (3) constructing a winter multipurpose dome;
180.2    (4) making improvements to Johnson Park Grandstand; and
180.3    (5) making improvements to the entrance road and parking at Hermann Heights Park.
180.4EFFECTIVE DATE.This section is effective the day after the governing body of the
180.5city of New Ulm and its chief clerical officer comply with Minnesota Statutes, section
180.6645.021, subdivisions 2 and 3.

180.7    Sec. 9. Laws 1999, chapter 243, article 4, section 17, is amended by adding a subdivision
180.8to read:
180.9    Subd. 4a. Bonding authority; additional use and extension of tax. As approved by
180.10the voters at the November 8, 2016, general election, and in addition to the bonds issued
180.11under subdivision 4, the city of New Ulm may issue general obligation bonds of the city in
180.12an amount not to exceed $14,800,000 for the projects listed in subdivision 3, paragraph (b).
180.13The debt represented by bonds under this subdivision shall not be included in computing
180.14any debt limitations applicable to the city of New Ulm, and the levy of taxes required by
180.15Minnesota Statutes, section 475.61, to pay principal of and interest on the bonds, and shall
180.16not be subject to any levy limitation or be included in computing or applying any levy
180.17limitation applicable to the city.
180.18EFFECTIVE DATE.This section is effective the day after the governing body of the
180.19city of New Ulm and its chief clerical officer comply with Minnesota Statutes, section
180.20645.021, subdivisions 2 and 3.

180.21    Sec. 10. Laws 1999, chapter 243, article 4, section 17, subdivision 5, is amended to read:
180.22    Subd. 5. Termination of taxes. The taxes imposed under subdivisions 1 and 2 expire
180.23when the city council determines that sufficient funds have been received from the taxes to
180.24finance the capital and administrative costs for the acquisition, construction, and improvement
180.25of facilities described in subdivision 3, including the additional use of revenues under
180.26subdivision 3, paragraph (b), as approved by the voters at the November 8, 2016, general
180.27election, and to prepay or retire at maturity the principal, interest, and premium due on any
180.28bonds issued for the facilities under subdivision 4 subdivisions 4 and 4a. Any funds remaining
180.29after completion of the project and retirement or redemption of the bonds may be placed in
180.30the general fund of the city. The taxes imposed under subdivisions 1 and 2 may expire at
180.31an earlier time if the city so determines by ordinance.
181.1EFFECTIVE DATE.This section is effective the day after the governing body of the
181.2city of New Ulm and its chief clerical officer comply with Minnesota Statutes, section
181.3645.021, subdivisions 2 and 3.

181.4    Sec. 11. Laws 1999, chapter 243, article 4, section 18, subdivision 1, as amended by Laws
181.52008, chapter 366, article 7, section 12, is amended to read:
181.6    Subdivision 1. Sales and use tax. (a) Notwithstanding Minnesota Statutes, section
181.7477A.016 , or any other provision of law, ordinance, or city charter, if approved by the city
181.8voters at the first municipal general election held after the date of final enactment of this
181.9act or at a special election held November 2, 1999, the city of Proctor may impose by
181.10ordinance a sales and use tax of up to one-half of one percent for the purposes specified in
181.11subdivision 3. The provisions of Minnesota Statutes, section 297A.99, govern the imposition,
181.12administration, collection, and enforcement of the tax authorized under this subdivision.
181.13(b) Notwithstanding Minnesota Statutes, section 477A.016, or any other provision of
181.14law, ordinance, or city charter, the city of Proctor may impose by ordinance an additional
181.15sales and use tax of up to one-half of one percent as approved by the voters at the November
181.164, 2014, election. The revenues received from the additional tax must be used for the purposes
181.17specified in subdivision 3, paragraph (b).
181.18EFFECTIVE DATE.This section is effective the day after the governing body of the
181.19city of Proctor and its chief clerical officer comply with Minnesota Statutes, section 645.021,
181.20subdivisions 2 and 3.

181.21    Sec. 12. Laws 2005, First Special Session chapter 3, article 5, section 38, subdivision 2,
181.22as amended by Laws 2006, chapter 259, article 3, section 6, is amended to read:
181.23    Subd. 2. Use of revenues. The proceeds of the tax imposed under this section shall be
181.24used to pay for lake water quality improvement projects as detailed in the Shell Rock River
181.25watershed plan and as directed by the Shell Rock River Watershed Board. Notwithstanding
181.26any provision of statute, other law, or city charter to the contrary, the city shall transfer all
181.27revenues from the tax imposed under subdivision 1, as soon as they are received, to the
181.28Shell Rock River Watershed District. The city is not required to review the intended uses
181.29of the revenues by the watershed district, nor is the watershed district required to submit to
181.30the city proposed budgets, statements, or invoices explaining the intended uses of the
181.31revenues as a prerequisite for the transfer of the revenues. The Shell Rock River Watershed
181.32District shall appear before the city of Albert Lea City Council on a biannual basis to present
181.33a report of its activities, expenditures, and intended uses of the city sales tax revenue.
182.1EFFECTIVE DATE.This section is effective the day after the governing body of the
182.2city of Albert Lea and its chief clerical officer comply with Minnesota Statutes, section
182.3645.021, subdivisions 2 and 3.

182.4    Sec. 13. Laws 2005, First Special Session chapter 3, article 5, section 38, subdivision 4,
182.5as amended by Laws 2014, chapter 308, article 3, section 23, is amended to read:
182.6    Subd. 4. Termination of taxes. The taxes imposed under this section expire at the earlier
182.7of (1) 15 30 years after the taxes are first imposed, or (2) when the city council first
182.8determines that the amount of revenues raised to pay for the projects under subdivision 2,
182.9shall meet or exceed the sum of $15,000,000 $30,000,000. Any funds remaining after
182.10completion of the projects may be placed in the general fund of the city.
182.11EFFECTIVE DATE.This section is effective the day after the governing body of the
182.12city of Albert Lea and its chief clerical officer comply with Minnesota Statutes, section
182.13645.021, subdivisions 2 and 3.

182.14    Sec. 14. Laws 2008, chapter 366, article 7, section 20, is amended to read:
182.15    Sec. 20. CITY OF NORTH MANKATO; TAXES AUTHORIZED.
182.16    Subdivision 1. Sales and use tax authorized. Notwithstanding Minnesota Statutes,
182.17section 477A.016, or any other provision of law, ordinance, or city charter, pursuant to the
182.18approval of the voters on November 7, 2006, the city of North Mankato may impose by
182.19ordinance a sales and use tax of one-half of one percent for the purposes specified in
182.20subdivision 2. The provisions of Minnesota Statutes, section 297A.99, govern the imposition,
182.21administration, collection, and enforcement of the taxes authorized under this subdivision.
182.22    Subd. 2. Use of revenues. Revenues received from the tax authorized by subdivision 1
182.23must be used to pay all or part of the capital costs of the following projects:
182.24    (1) the local share of the Trunk Highway 14/County State-Aid Highway 41 interchange
182.25project;
182.26    (2) development of regional parks and hiking and biking trails, including construction
182.27of indoor regional athletic facilities;
182.28    (3) expansion of the North Mankato Taylor Library;
182.29    (4) riverfront redevelopment; and
182.30    (5) lake improvement projects.
183.1    The total amount of revenues from the tax in subdivision 1 that may be used to fund
183.2these projects is $6,000,000 $15,000,000 plus any associated bond costs.
183.3    Subd. 2a. Authorization to extend the tax. Notwithstanding Minnesota Statutes, section
183.4297A.99, subdivision 3, the North Mankato city council may, by resolution, extend the tax
183.5authorized under subdivision 1 to cover an additional $9,000,000 in bonds, plus associated
183.6bond costs, to fund the projects in subdivision 2 as approved by the voters at the November
183.78, 2016, general election.
183.8    Subd. 3. Bonds. (a) The city of North Mankato, pursuant to the approval of the voters
183.9at the November 7, 2006 referendum authorizing the imposition of the taxes in this section,
183.10may issue bonds under Minnesota Statutes, chapter 475, to pay capital and administrative
183.11expenses for the projects described in subdivision 2, in an amount that does not exceed
183.12$6,000,000. A separate election to approve the bonds under Minnesota Statutes, section
183.13475.58 , is not required.
183.14(b) The city of North Mankato, pursuant to approval of the voters at the November 8,
183.152016, referendum extending the tax fee to provide additional revenue to be spent for the
183.16projects in subdivision 2, may issue additional bonds under Minnesota Statutes, chapter
183.17475, to pay capital and administrative expenses for those projects in an amount that does
183.18not exceed $9,000,000. A separate election to approve the bonds under Minnesota Statutes,
183.19section 475.58, is not required.
183.20    (b) (c) The debt represented by the bonds is not included in computing any debt limitation
183.21applicable to the city, and any levy of taxes under Minnesota Statutes, section 475.61, to
183.22pay principal and interest on the bonds is not subject to any levy limitation.
183.23    Subd. 4. Termination of taxes. The tax imposed under subdivision 1 expires when the
183.24city council determines that the amount of revenues received from the taxes to pay for the
183.25projects under subdivision 2 first equals or exceeds $6,000,000 plus the additional amount
183.26needed to pay the costs related to issuance of bonds under subdivision 3, including interest
183.27on the bonds at the earlier of December 31, 2038, or when revenues from the taxes first
183.28equal or exceed $15,000,000 plus the additional amount needed to pay costs related to
183.29issuance of bonds under subdivision 3, including interest. Any funds remaining after
183.30completion of the projects and retirement or redemption of the bonds shall be placed in a
183.31capital facilities and equipment replacement fund of the city. The tax imposed under
183.32subdivision 1 may expire at an earlier time if the city so determines by ordinance.
184.1EFFECTIVE DATE.This section is effective the day after the governing body of the
184.2city of North Mankato and its chief clerical officer comply with Minnesota Statutes, section
184.3645.021, subdivisions 2 and 3.

184.4    Sec. 15. CITY OF EAST GRAND FORKS; TAXES AUTHORIZED.
184.5    Subdivision 1. Sales and use tax authorization. Notwithstanding Minnesota Statutes,
184.6section 297A.99, subdivisions 1 and 2, or 477A.016, or any other law, ordinance, or city
184.7charter, and as approved by the voters at a special election on March 7, 2016, the city of
184.8East Grand Forks may impose, by ordinance, a sales and use tax of up to one percent for
184.9the purposes specified in subdivision 2. Except as otherwise provided in this section, the
184.10provisions of Minnesota Statutes, section 297A.99, govern the imposition, administration,
184.11collection, and enforcement of the tax authorized under this subdivision.
184.12    Subd. 2. Use of sales and use tax revenues. The revenues derived from the tax authorized
184.13under subdivision 1 must be used by the city of East Grand Forks to pay the costs of
184.14collecting and administering the tax and to finance the capital and administrative costs of
184.15improvement to the city public swimming pool. Authorized expenses include, but are not
184.16limited to, paying construction expenses related to the renovation and the development of
184.17these facilities and improvements, and securing and paying debt service on bonds issued
184.18under subdivision 3 or other obligations issued to finance improvement of the public
184.19swimming pool in the city of East Grand Forks
184.20    Subd. 3. Bonding authority. (a) The city of East Grand Forks may issue bonds under
184.21Minnesota Statutes, chapter 475, to finance all or a portion of the costs of the facilities
184.22authorized in subdivision 2. The aggregate principal amount of bonds issued under this
184.23subdivision may not exceed $2,820,000, plus an amount to be applied to the payment of
184.24the costs of issuing the bonds. The bonds may be paid from or secured by any funds available
184.25to the city of East Grand Forks, including the tax authorized under subdivision 1. The
184.26issuance of bonds under this subdivision is not subject to Minnesota Statutes, sections 275.60
184.27and 275.61.
184.28(b) The bonds are not included in computing any debt limitation applicable to the city
184.29of East Grand Forks, and any levy of taxes under Minnesota Statutes, section 475.61, to
184.30pay principal and interest on the bonds is not subject to any levy limitation. A separate
184.31election to approve the bonds under Minnesota Statutes, section 475.58, is not required.
184.32    Subd. 4. Termination of taxes. The tax imposed under subdivision 1 expires at the later
184.33of: (1) five years after the tax is first imposed; or (2) when the city council determines that
184.34$2,820,000 has been received from the tax to pay for the cost of the projects authorized
185.1under subdivision 2, plus an amount sufficient to pay the costs related to issuance of the
185.2bonds authorized under subdivision 3, including interest on the bonds. Any funds remaining
185.3after payment of all such costs and retirement or redemption of the bonds shall be placed
185.4in the general fund of the city. The tax imposed under subdivision 1 may expire at an earlier
185.5time if the city so determines by ordinance.
185.6EFFECTIVE DATE.This section is effective the day after the governing body of the
185.7city of East Grand Forks and its chief clerical officer comply with Minnesota Statutes,
185.8section 645.021, subdivisions 2 and 3.

185.9    Sec. 16. CITY OF FAIRMONT; LOCAL TAX AUTHORIZED.
185.10    Subdivision 1. Sales and use tax authorization. Notwithstanding Minnesota Statutes,
185.11section 297A.99, subdivisions 1 and 2, or 477A.016, or any other law, ordinance, or city
185.12charter, and as approved by the voters at the general election of November 8, 2016, the city
185.13of Fairmont may impose, by ordinance, a sales and use tax of one-half of one percent for
185.14the purposes specified in subdivision 2. Except as otherwise provided in this section, the
185.15provisions of Minnesota Statutes, section 297A.99, govern the imposition, administration,
185.16collection, and enforcement of the tax authorized under this subdivision.
185.17    Subd. 2. Use of sales and use tax revenues. The revenues derived from the tax authorized
185.18under subdivision 1 must be used by the city of Fairmont to pay the costs of collecting and
185.19administering the tax and to finance the capital and administrative costs of constructing and
185.20funding recreational amenities, trails, and a community center. The total that may be raised
185.21from the tax to pay for these projects is limited to $15,000,000, plus the costs related to the
185.22issuance and paying debt service on bonds for these projects.
185.23    Subd. 3. Bonding authority. (a) The city of Fairmont may issue bonds under Minnesota
185.24Statutes, chapter 475, to finance all or a portion of the costs of the facilities authorized in
185.25subdivision 2. The aggregate principal amount of bonds issued under this subdivision may
185.26not exceed $15,000,000, plus an amount to be applied to the payment of the costs of issuing
185.27the bonds. The bonds may be paid from or secured by any funds available to the city of
185.28Fairmont, including the tax authorized under subdivision 1. The issuance of bonds under
185.29this subdivision is not subject to Minnesota Statutes, sections 275.60 and 275.61.
185.30(b) The bonds are not included in computing any debt limitation applicable to the city
185.31of Fairmont, and any levy of taxes under Minnesota Statutes, section 475.61, to pay principal
185.32and interest on the bonds is not subject to any levy limitation. A separate election to approve
185.33the bonds under Minnesota Statutes, section 475.58, is not required.
186.1    Subd. 4. Termination of taxes. The tax imposed under subdivision 1 expires at the
186.2earlier of: (1) 25 years after the tax is first imposed; or (2) when the city council determines
186.3that $15,000,000, plus an amount sufficient to pay the costs related to issuing the bonds
186.4authorized under subdivision 3, including interest on the bonds, has been received from the
186.5tax to pay for the cost of the projects authorized under subdivision 2. Any funds remaining
186.6after payment of all such costs and retirement or redemption of the bonds shall be placed
186.7in the general fund of the city. The tax imposed under subdivision 1 may expire at an earlier
186.8time if the city so determines by ordinance.
186.9EFFECTIVE DATE.This section is effective the day after the governing body of the
186.10city of Fairmont and its chief clerical officer comply with Minnesota Statutes, section
186.11645.021, subdivisions 2 and 3.

186.12    Sec. 17. CITY OF FERGUS FALLS; TAXES AUTHORIZED.
186.13    Subdivision 1. Sales and use tax authorized. Notwithstanding Minnesota Statutes,
186.14section 297A.99, subdivision 1, section 477A.016, or any other law, ordinance, or city
186.15charter, and as approved by the voters at the November 8, 2016, general election, the city
186.16of Fergus Falls may impose, by ordinance, a sales and use tax of up to one-half of one
186.17percent for the purposes specified in subdivision 2. Except as otherwise provided in this
186.18section, the provisions of Minnesota Statutes, section 297A.99, govern the imposition,
186.19administration, collection, and enforcement of the tax authorized under this subdivision.
186.20    Subd. 2. Use of sales and use tax revenues. The revenues from the tax authorized under
186.21subdivision 1 must be used by the city of Fergus Falls to pay the costs of collecting and
186.22administering the tax and securing and paying debt service on bonds issued to finance all
186.23or part of the costs of the expansion and betterment of the Fergus Falls Public Library located
186.24at 205 East Hampden Avenue in the city of Fergus Falls.
186.25    Subd. 3. Bonding authority. (a) The city of Fergus Falls may issue bonds under
186.26Minnesota Statutes, chapter 475, to finance all or a portion of the costs of the project
186.27authorized in subdivision 2. The aggregate principal amount of bonds issued under this
186.28subdivision may not exceed $9,800,000, plus an amount applied to the payment of costs of
186.29issuing the bonds. The bonds may be paid from or secured by any funds available to the
186.30city of Fergus Falls, including the tax authorized under subdivision 1. The issuance of bonds
186.31under this subdivision is not subject to Minnesota Statutes, section 275.60 and 275.61.
186.32(b) The bonds are not included in computing any debt limitation applicable to the city,
186.33and any levy of taxes under Minnesota Statutes, section 475.61, to pay principal of and
187.1interest on the bonds is not subject to any levy limitation. A separate election to approve
187.2the bonds under Minnesota Statutes, section 475.58, is not required.
187.3    Subd. 4. Termination of taxes. The tax imposed under subdivision 1 expires at the
187.4earlier of: (1) 12 years after the tax is first imposed, or (2) when the city council determines
187.5that $9,800,000 has been received from the tax to pay for the cost of the project authorized
187.6under subdivision 2, plus an amount sufficient to pay the costs related to the issuance of the
187.7bonds authorized under subdivision 3, including interest on the bonds. Any funds remaining
187.8after payment of all such costs and retirement or redemption of the bonds shall be placed
187.9in the general fund of the city. The tax imposed under subdivision 1 may expire at any
187.10earlier time if the city so determines by ordinance.
187.11EFFECTIVE DATE.This section is effective the day after the governing body of the
187.12city of Fergus Falls and its chief clerical officer comply with Minnesota Statutes, section
187.13645.021, subdivisions 2 and 3.

187.14    Sec. 18. CITY OF MOOSE LAKE; TAXES AUTHORIZED.
187.15    Subdivision 1. Sales and use tax authorization. Notwithstanding Minnesota Statutes,
187.16section 297A.99, subdivision 1, or 477A.016, or any other law, ordinance, or city charter,
187.17as approved by the voters at the November 6, 2012, general election, the city of Moose Lake
187.18may impose, by ordinance, a sales and use tax of up to one-half of one percent for the
187.19purposes specified in subdivision 2. Except as otherwise provided in this section, the
187.20provisions of Minnesota Statutes, section 297A.99, govern the imposition, administration,
187.21collection, and enforcement of the tax authorized under this subdivision.
187.22    Subd. 2. Use of sales and use tax revenues. The revenues derived from the tax authorized
187.23under subdivision 1 must be used by the city of Moose Lake to pay the costs of collecting
187.24and administering the tax and to finance the costs of: (1) improvements to the city's park
187.25system; (2) street and related infrastructure improvements; and (3) municipal arena
187.26improvements. Authorized costs include construction and engineering costs and associated
187.27bond costs.
187.28    Subd. 3. Bonding authority. The city of Moose Lake may issue bonds under Minnesota
187.29Statutes, chapter 475, to finance all or a portion of the costs of the facilities authorized in
187.30subdivision 2. The aggregate principal amount of bonds issued under this subdivision may
187.31not exceed $3,000,000, plus an amount to be applied to the payment of the costs of issuing
187.32the bonds. The bonds may be paid from or secured by any funds available to the city of
187.33Moose Lake, including the tax authorized under subdivision 1. The issuance of bonds under
187.34this subdivision is not subject to Minnesota Statutes, sections 275.60 and 275.61.
188.1The bonds are not included in computing any debt limitation applicable to the city of
188.2Moose Lake, and any levy of taxes under Minnesota Statutes, section 475.61, to pay principal
188.3and interest on the bonds is not subject to any levy limitation. A separate election to approve
188.4the bonds under Minnesota Statutes, section 475.58, is not required.
188.5    Subd. 4. Termination of taxes. The tax imposed under subdivision 1 expires at the
188.6earlier of: (1) 20 years after the tax is first imposed; or (2) when the city council determines
188.7that $3,000,000 has been received from the tax to pay for the cost of the projects authorized
188.8under subdivision 2, plus an amount sufficient to pay the costs related to issuance of the
188.9bonds authorized under subdivision 3, including interest on the bonds. Any funds remaining
188.10after payment of all such costs and retirement or redemption of the bonds shall be placed
188.11in the general fund of the city. The tax imposed under subdivision 1 may expire at an earlier
188.12time if the city so determines by ordinance.
188.13EFFECTIVE DATE.This section is effective the day after the governing body of the
188.14city of Moose Lake and its chief clerical officer comply with Minnesota Statutes, section
188.15645.021, subdivisions 2 and 3.

188.16    Sec. 19. CITY OF NEW LONDON; TAX AUTHORIZED.
188.17    Subdivision 1. Sales and use tax authorization. Notwithstanding Minnesota Statutes,
188.18section 297A.99, subdivisions 1 and 2, or 477A.016, or any other law, ordinance, or city
188.19charter, and as approved by the voters at the general election of November 8, 2016, the city
188.20of New London may impose, by ordinance, a sales and use tax of one-half of one percent
188.21for the purposes specified in subdivision 2. Except as otherwise provided in this section,
188.22the provisions of Minnesota Statutes, section 297A.99, govern the imposition, administration,
188.23collection, and enforcement of the tax authorized under this subdivision.
188.24    Subd. 2. Use of sales and use tax revenues. The revenues derived from the tax authorized
188.25under subdivision 1 must be used by the city of New London to pay the costs of collecting
188.26and administering the tax and to finance the capital and administrative costs of the following
188.27projects:
188.28(1) construction and equipping of a new library and community room;
188.29(2) construction of an ambulance bay at the fire hall; and
188.30(3) improvements to the New London Senior Citizen Center.
188.31The total that may be raised from the tax to pay for these projects is limited to $872,000
188.32plus the costs related to the issuance and paying debt service on bonds for these projects.
189.1    Subd. 3. Bonding authority. (a) The city of New London may issue bonds under
189.2Minnesota Statutes, chapter 475, to finance all or a portion of the costs of the facilities
189.3authorized in subdivision 2. The aggregate principal amount of bonds issued under this
189.4subdivision may not exceed $872,000, plus an amount to be applied to the payment of the
189.5costs of issuing the bonds. The bonds may be paid from or secured by any funds available
189.6to the city of New London, including the tax authorized under subdivision 1. The issuance
189.7of bonds under this subdivision is not subject to Minnesota Statutes, sections 275.60 and
189.8275.61.
189.9(b) The bonds are not included in computing any debt limitation applicable to the city
189.10of New London, and any levy of taxes under Minnesota Statutes, section 475.61, to pay
189.11principal and interest on the bonds is not subject to any levy limitation. A separate election
189.12to approve the bonds under Minnesota Statutes, section 475.58, is not required.
189.13    Subd. 4. Termination of taxes. The tax imposed under subdivision 1 expires at the
189.14earlier of: (1) 20 years after the tax is first imposed; or (2) when the city council determines
189.15that $872,000, plus an amount sufficient to pay the costs related to issuing the bonds
189.16authorized under subdivision 3, including interest on the bonds, has been received from the
189.17tax to pay for the cost of the projects authorized under subdivision 2. Any funds remaining
189.18after payment of all such costs and retirement or redemption of the bonds shall be placed
189.19in the general fund of the city. The tax imposed under subdivision 1 may expire at an earlier
189.20time if the city so determines by ordinance.
189.21EFFECTIVE DATE.This section is effective the day after the governing body of the
189.22city of New London and its chief clerical officer comply with Minnesota Statutes, section
189.23645.021, subdivisions 2 and 3.

189.24    Sec. 20. CITY OF SLEEPY EYE; LODGING TAX.
189.25Notwithstanding Minnesota Statutes, section 477A.016, or any other provision of law,
189.26ordinance, or city charter, the city council for the city of Sleepy Eye may impose, by
189.27ordinance, a tax of up to two percent on the gross receipts subject to the lodging tax under
189.28Minnesota Statutes, section 469.190. This tax is in addition to any tax imposed under
189.29Minnesota Statutes, section 469.190, and the total tax imposed under that section and this
189.30provision must not exceed five percent. Revenue from the tax imposed under this section
189.31may only be used for the same purposes as a tax imposed under Minnesota Statutes, section
189.32469.190.
190.1EFFECTIVE DATE.This section is effective the day after the governing body of the
190.2city of Sleepy Eye and its chief clerical officer comply with Minnesota Statutes, section
190.3645.021, subdivisions 2 and 3.

190.4    Sec. 21. CITY OF SPICER; TAX AUTHORIZED.
190.5    Subdivision 1. Sales and use tax authorization. Notwithstanding Minnesota Statutes,
190.6section 297A.99, subdivisions 1 and 2, or 477A.016, or any other law, ordinance, or city
190.7charter, and as approved by the voters at the general election of November 8, 2016, the city
190.8of Spicer may impose, by ordinance, a sales and use tax of one-half of one percent for the
190.9purposes specified in subdivision 2. Except as otherwise provided in this section, the
190.10provisions of Minnesota Statutes, section 297A.99, govern the imposition, administration,
190.11collection, and enforcement of the tax authorized under this subdivision.
190.12    Subd. 2. Use of sales and use tax revenues. The revenues derived from the tax authorized
190.13under subdivision 1 must be used by the city of Spicer to pay the costs of collecting and
190.14administering the tax and to finance the capital and administrative costs of the following
190.15projects:
190.16(1) pedestrian public safety improvements such as a pedestrian bridge or crosswalk
190.17signals at marked Trunk Highway 23;
190.18(2) park and trail capital improvements including signage for bicycle share the road
190.19improvements and replacement of playground and related facilities; and
190.20(3) capital improvements to regional community facilities such as the Dethelfs roof and
190.21window replacement and the Pioneerland branch library roof replacement.
190.22    Subd. 3. Termination of taxes. The tax imposed under subdivision 1 expires at the
190.23earlier of: (1) ten years after the tax is first imposed; or (2) December 31, 2027. All funds
190.24not used to pay collection and administration costs of the tax must be used for projects listed
190.25in subdivision 2. The tax imposed under subdivision 1 may expire at an earlier time if the
190.26city so determines by ordinance.
190.27EFFECTIVE DATE.This section is effective the day after the governing body of the
190.28city of Spicer and its chief clerical officer comply with Minnesota Statutes, section 645.021,
190.29subdivisions 2 and 3.

190.30    Sec. 22. CITY OF WALKER; LOCAL TAXES AUTHORIZED.
190.31    Subdivision 1. Sales and use tax authorized. Notwithstanding Minnesota Statutes,
190.32section 477A.016, or any ordinance, city charter, or other provision of law, pursuant to the
191.1approval of the voters at the general election on November 6, 2012, the city of Walker may
191.2impose by ordinance a sales and use tax of 1-1/2 percent for the purposes specified in
191.3subdivision 2. The provisions of Minnesota Statutes, section 297A.99, govern the imposition,
191.4administration, collection, and enforcement of the taxes authorized under this subdivision.
191.5    Subd. 2. Use of revenues. Revenues received from the tax authorized by subdivision 1
191.6must be used to pay all or part of the capital and administrative costs of underground utility,
191.7street, curb, gutter, and sidewalk improvements in the city of Walker as outlined in the 2012
191.8capital improvement plan of the engineer of the city of Walker.
191.9    Subd. 3. Bonding authority. The city of Walker, pursuant to the approval of the voters
191.10at the November 6, 2012, referendum authorizing the imposition of the taxes in this section,
191.11may issue bonds under Minnesota Statutes, chapter 475, to pay capital and administrative
191.12expenses for the projects described in subdivision 2, in an amount that does not exceed
191.13$20,000,000. A separate election to approve the bonds under Minnesota Statutes, section
191.14475.58, is not required.
191.15    Subd. 4. Termination of tax. (a) The tax authorized under subdivision 1 terminates at
191.16the earlier of:
191.17(1) 20 years after the date of initial imposition of the tax; or
191.18(2) when the city council determines that sufficient funds have been raised from the tax
191.19to finance the capital and administrative costs of the improvements described in subdivision
191.202, plus the additional amount needed to pay the costs related to issuance of bonds under
191.21subdivision 3, including interest on the bonds.
191.22(b) Any funds remaining after completion of the projects specified in subdivision 2 and
191.23retirement or redemption of bonds in subdivision 3 shall be placed in the general fund of
191.24the city. The tax imposed under subdivision 1 may expire at an earlier time if the city so
191.25determines by ordinance.
191.26EFFECTIVE DATE.This section is effective the day after the governing body of the
191.27city of Walker and its chief clerical officer comply with Minnesota Statutes, section 645.021,
191.28subdivisions 2 and 3.

191.29    Sec. 23. CITY OF WINDOM; TAXES AUTHORIZED.
191.30    Subdivision 1. Sales and use tax authorized. Notwithstanding Minnesota Statutes,
191.31section 477A.016, or any other provision of law, ordinance, or city charter, as approved by
191.32the voters at the general election held on November 8, 2016, the city of Windom may impose
191.33by ordinance a sales and use tax of up to one percent for the purposes specified in subdivision
192.13. Except as provided in this section, the provisions of Minnesota Statutes, section 297A.99,
192.2govern the imposition, administration, collection, and enforcement of the tax authorized
192.3under this subdivision.
192.4    Subd. 2. Use of revenues. The proceeds of the tax imposed under this section must be
192.5used to pay for the cost of collecting the tax and to pay all or a portion of the expenses of
192.6constructing and improving a fire hall and a public safety facility, including any associated
192.7bond costs.
192.8    Subd. 3. Bonding authority. The city of Windom, pursuant to the approval of the voters
192.9at the referendum authorizing the imposition of tax in this section, may issue bonds under
192.10Minnesota Statutes, chapter 475, to pay capital and administrative expenses for the project
192.11described in subdivision 2. A separate election to approve the bonds under Minnesota
192.12Statutes, section 475.58, is not required.
192.13    Subd. 4. Termination of tax. (a) The tax authorized under subdivision 1 terminates at
192.14the earlier of:
192.15(1) 15 years after the date of initial imposition of the tax; or
192.16(2) when $3,500,000 has been collected.
192.17(b) Any funds remaining after completion of the projects specified in subdivision 2 may
192.18be placed in the general fund of the city. The tax imposed under subdivision 1 may expire
192.19at an earlier time if the city so determines by ordinance.
192.20EFFECTIVE DATE.This section is effective the day after the governing body of the
192.21city of Windom and its chief clerical officer comply with Minnesota Statutes, section
192.22645.021, subdivisions 2 and 3.

192.23    Sec. 24. CLAY COUNTY; TAX AUTHORIZED.
192.24    Subdivision 1. Sales and use tax authorization. Notwithstanding Minnesota Statutes,
192.25section 297A.99, subdivisions 1 and 2, or 477A.016, or any other law or ordinance, and as
192.26approved by the voters at the November 8, 2016, general election, Clay County may impose,
192.27by ordinance, a sales and use tax of up to one-half of one percent for the purposes specified
192.28in subdivision 2. Except as otherwise provided in this section, the provisions of Minnesota
192.29Statutes, section 297A.99, govern the imposition, administration, collection, and enforcement
192.30of the tax authorized under this subdivision.
192.31    Subd. 2. Use of sales and use tax revenues. The revenues derived from the tax authorized
192.32under subdivision 1 must be used by Clay County to pay the costs of collecting and
193.1administering the tax and to finance the capital and administrative costs of constructing and
193.2equipping a new correctional facility, law enforcement center, and related parking facility.
193.3Authorized expenses include but are not limited to paying design, development, and
193.4construction costs related to these facilities and improvements, and securing and paying
193.5debt service on bonds issued under subdivision 3 or other obligations issued to finance the
193.6facilities listed in this subdivision.
193.7    Subd. 3. Bonding authority. Clay County may issue bonds under Minnesota Statutes,
193.8chapter 475, to finance all or a portion of the costs of the facilities authorized in subdivision
193.92. The aggregate principal amount of bonds issued under this subdivision may not exceed
193.10$52,000,000, plus an amount to be applied to the payment of the costs of issuing the bonds.
193.11The bonds may be paid from or secured by any funds available to Clay County, including
193.12the tax authorized under subdivision 1. The issuance of bonds under this subdivision is not
193.13subject to Minnesota Statutes, sections 275.60 and 275.61.
193.14    Subd. 4. Termination of taxes. The tax imposed under subdivision 1 expires at the
193.15earlier of: (1) 20 years after the tax is first imposed; or (2) when the county board determines
193.16that $52,000,000, plus an amount sufficient to pay the costs related to issuance of the bonds
193.17authorized under subdivision 3, including interest on the bonds, has been received from the
193.18tax to pay for the cost of the projects authorized under subdivision 2. Any funds remaining
193.19after payment of all such costs and retirement or redemption of the bonds shall be placed
193.20in the general fund of the county. The tax imposed under subdivision 1 may expire at an
193.21earlier time if the county so determines by ordinance.
193.22EFFECTIVE DATE.This section is effective the day after the governing body of Clay
193.23County and its chief clerical officer comply with Minnesota Statutes, section 645.021,
193.24subdivisions 2 and 3.

193.25    Sec. 25. GARRISON, KATHIO, WEST MILLE LACS LAKE SANITARY
193.26DISTRICT; TAXES AUTHORIZED.
193.27    Subdivision 1. Sales and use tax authorization. Notwithstanding Minnesota Statutes,
193.28section 297A.99, subdivisions 1 and 2, or 477A.016, or any other law, and as approved by
193.29the voters at the November 8, 2016, general election, the Garrison, Kathio, West Mille Lacs
193.30Lake Sanitary District may impose, by majority vote of the governing body of the district,
193.31a sales and use tax of up to one percent for the purposes specified in subdivision 2. Except
193.32as otherwise provided in this section, the provisions of Minnesota Statutes, section 297A.99,
193.33govern the imposition, administration, collection, and enforcement of the tax authorized
193.34under this subdivision.
194.1    Subd. 2. Use of sales and use tax revenues. The revenues derived from the tax authorized
194.2under subdivision 1 must be used by the Garrison, Kathio, West Mille Lacs Lake Sanitary
194.3District to pay the costs of collecting and administering the tax and to repay general obligation
194.4revenue notes issued or other debt incurred for the construction of the wastewater collection
194.5system through the Minnesota Public Facilities Authority, general obligation disposal system
194.6bonds issued to finance the expense incurred in financing construction of sewer system
194.7improvements, and notes payable issued for costs associated with the sewer services
194.8agreement between the Garrison, Kathio, West Mille Lacs Lake Sanitary District and ML
194.9Wastewater Inc., and any other costs associated with system maintenance and improvements,
194.10including extension of the system to unserved customers as determined by the governing
194.11body of the district.
194.12    Subd. 3. Bonds. The Garrison, Kathio, West Mille Lacs Lake Sanitary District, pursuant
194.13to the approval of the voters at the November 8, 2016, referendum authorizing the imposition
194.14of the tax under this section, may issue general obligation disposal system bonds for financing
194.15construction of sewer system improvements without a separate election required under
194.16Minnesota Statutes, section 442.25 or 475.58. The amount of bonds that may be issued
194.17without a separate election is equal to $10,000,000 minus the amount of the tax revenue
194.18under this section committed to repay other notes as allowed under subdivision 2.
194.19    Subd. 4. Termination of taxes. The tax imposed under subdivision 1 expires at the
194.20earlier of: (1) 20 years after the tax is first imposed; or (2) when the governing body of the
194.21Garrison, Kathio, West Mille Lacs Lake Sanitary District determines that $10,000,000 has
194.22been received from the tax to pay for the costs authorized under subdivision 2. Any funds
194.23remaining after payment of all such costs and retirement or redemption of the bonds shall
194.24be placed in the general fund of the district. The tax imposed under subdivision 1 may expire
194.25at an earlier time if the governing body of the district so determines.
194.26EFFECTIVE DATE.This section is effective the day after the governing body of the
194.27Garrison, Kathio, West Mille Lacs Lake Sanitary District and its chief clerical officer comply
194.28with Minnesota Statutes, section 645.021, subdivisions 2 and 3.

194.29    Sec. 26. EFFECTIVE DATE; VALIDATION OF PRIOR ACT.
194.30Notwithstanding the time limits in Minnesota Statutes, section 645.021, the city of
194.31Proctor may approve Laws 2008, chapter 366, article 7, section 13, and Laws 2010, chapter
194.32389, article 5, sections 1 and 2, and file its approval with the secretary of state by January
194.331, 2015. If approved under this paragraph, actions undertaken by the city pursuant to the
195.1approval of the voters on November 2, 2010, and otherwise in accordance with those laws
195.2are validated.
195.3EFFECTIVE DATE.This section is effective the day after the governing body of the
195.4city of Proctor and its chief clerical officer comply with Minnesota Statutes, section 645.021,
195.5subdivisions 2 and 3.

195.6ARTICLE 7
195.7TAX INCREMENT FINANCING

195.8    Section 1. Minnesota Statutes 2016, section 469.174, subdivision 12, is amended to read:
195.9    Subd. 12. Economic development district. "Economic development district" means a
195.10type of tax increment financing district which consists of any project, or portions of a project,
195.11which the authority finds to be in the public interest because:
195.12(1) it will discourage commerce, industry, or manufacturing from moving their operations
195.13to another state or municipality; or
195.14(2) it will result in increased employment in the state; or
195.15(3) it will result in preservation and enhancement of the tax base of the state; or
195.16(4) it satisfies the requirements of a workforce housing project under section 469.176,
195.17subdivision 4c, paragraph (d).
195.18EFFECTIVE DATE.This section is effective for districts for which the request for
195.19certification was made after June 30, 2017.

195.20    Sec. 2. Minnesota Statutes 2016, section 469.175, subdivision 3, is amended to read:
195.21    Subd. 3. Municipality approval. (a) A county auditor shall not certify the original net
195.22tax capacity of a tax increment financing district until the tax increment financing plan
195.23proposed for that district has been approved by the municipality in which the district is
195.24located. If an authority that proposes to establish a tax increment financing district and the
195.25municipality are not the same, the authority shall apply to the municipality in which the
195.26district is proposed to be located and shall obtain the approval of its tax increment financing
195.27plan by the municipality before the authority may use tax increment financing. The
195.28municipality shall approve the tax increment financing plan only after a public hearing
195.29thereon after published notice in a newspaper of general circulation in the municipality at
195.30least once not less than ten days nor more than 30 days prior to the date of the hearing. The
195.31published notice must include a map of the area of the district from which increments may
196.1be collected and, if the project area includes additional area, a map of the project area in
196.2which the increments may be expended. The hearing may be held before or after the approval
196.3or creation of the project or it may be held in conjunction with a hearing to approve the
196.4project.
196.5    (b) Before or at the time of approval of the tax increment financing plan, the municipality
196.6shall make the following findings, and shall set forth in writing the reasons and supporting
196.7facts for each determination:
196.8    (1) that the proposed tax increment financing district is a redevelopment district, a
196.9renewal or renovation district, a housing district, a soils condition district, or an economic
196.10development district; if the proposed district is a redevelopment district or a renewal or
196.11renovation district, the reasons and supporting facts for the determination that the district
196.12meets the criteria of section 469.174, subdivision 10, paragraph (a), clauses (1) and (2), or
196.13subdivision 10a, must be documented in writing and retained and made available to the
196.14public by the authority until the district has been terminated;
196.15    (2) that, in the opinion of the municipality:
196.16    (i) the proposed development or redevelopment would not reasonably be expected to
196.17occur solely through private investment within the reasonably foreseeable future; and
196.18    (ii) the increased market value of the site that could reasonably be expected to occur
196.19without the use of tax increment financing would be less than the increase in the market
196.20value estimated to result from the proposed development after subtracting the present value
196.21of the projected tax increments for the maximum duration of the district permitted by the
196.22plan. The requirements of this item do not apply if the district is a housing district;
196.23    (3) that the tax increment financing plan conforms to the general plan for the development
196.24or redevelopment of the municipality as a whole;
196.25    (4) that the tax increment financing plan will afford maximum opportunity, consistent
196.26with the sound needs of the municipality as a whole, for the development or redevelopment
196.27of the project by private enterprise;
196.28    (5) that the municipality elects the method of tax increment computation set forth in
196.29section 469.177, subdivision 3, paragraph (b), if applicable.
196.30    (c) When the municipality and the authority are not the same, the municipality shall
196.31approve or disapprove the tax increment financing plan within 60 days of submission by
196.32the authority. When the municipality and the authority are not the same, the municipality
196.33may not amend or modify a tax increment financing plan except as proposed by the authority
197.1pursuant to subdivision 4. Once approved, the determination of the authority to undertake
197.2the project through the use of tax increment financing and the resolution of the governing
197.3body shall be conclusive of the findings therein and of the public need for the financing.
197.4    (d) For a district that is subject to the requirements of paragraph (b), clause (2), item
197.5(ii), the municipality's statement of reasons and supporting facts must include all of the
197.6following:
197.7    (1) an estimate of the amount by which the market value of the site will increase without
197.8the use of tax increment financing;
197.9    (2) an estimate of the increase in the market value that will result from the development
197.10or redevelopment to be assisted with tax increment financing; and
197.11    (3) the present value of the projected tax increments for the maximum duration of the
197.12district permitted by the tax increment financing plan.
197.13    (e) For purposes of this subdivision, "site" means the parcels on which the development
197.14or redevelopment to be assisted with tax increment financing will be located.
197.15(f) Before or at the time of approval of the tax increment financing plan for a district to
197.16be used to fund a workforce housing project under section 469.176, subdivision 4c, paragraph
197.17(d), the municipality shall make the following findings and set forth in writing the reasons
197.18and supporting facts for each determination:
197.19(1) the city is located outside of the metropolitan area, as defined in section 473.121,
197.20subdivision 2;
197.21(2) the average vacancy rate for rental housing located in the municipality and in any
197.22statutory or home rule charter city located within 15 miles or less of the boundaries of the
197.23municipality has been three percent or less for at least the immediately preceding two-year
197.24period;
197.25(3) at least one business located in the municipality or within 15 miles of the municipality
197.26that employs a minimum of 20 full-time equivalent employees in aggregate has provided a
197.27written statement to the municipality indicating that the lack of available rental housing has
197.28impeded the ability of the business to recruit and hire employees; and
197.29(4) the municipality and the development authority intend to use increments from the
197.30district for the development of rental housing to serve employees of businesses located in
197.31the municipality or surrounding area.
198.1EFFECTIVE DATE.This section is effective for districts for which the request for
198.2certification was made after June 30, 2017.

198.3    Sec. 3. Minnesota Statutes 2016, section 469.176, subdivision 4c, is amended to read:
198.4    Subd. 4c. Economic development districts. (a) Revenue derived from tax increment
198.5from an economic development district may not be used to provide improvements, loans,
198.6subsidies, grants, interest rate subsidies, or assistance in any form to developments consisting
198.7of buildings and ancillary facilities, if more than 15 percent of the buildings and facilities
198.8(determined on the basis of square footage) are used for a purpose other than:
198.9    (1) the manufacturing or production of tangible personal property, including processing
198.10resulting in the change in condition of the property;
198.11    (2) warehousing, storage, and distribution of tangible personal property, excluding retail
198.12sales;
198.13    (3) research and development related to the activities listed in clause (1) or (2);
198.14    (4) telemarketing if that activity is the exclusive use of the property;
198.15    (5) tourism facilities; or
198.16    (6) space necessary for and related to the activities listed in clauses (1) to (5); or
198.17    (7) a workforce housing project that satisfies the requirements of paragraph (d).
198.18    (b) Notwithstanding the provisions of this subdivision, revenues derived from tax
198.19increment from an economic development district may be used to provide improvements,
198.20loans, subsidies, grants, interest rate subsidies, or assistance in any form for up to 15,000
198.21square feet of any separately owned commercial facility located within the municipal
198.22jurisdiction of a small city, if the revenues derived from increments are spent only to assist
198.23the facility directly or for administrative expenses, the assistance is necessary to develop
198.24the facility, and all of the increments, except those for administrative expenses, are spent
198.25only for activities within the district.
198.26    (c) A city is a small city for purposes of this subdivision if the city was a small city in
198.27the year in which the request for certification was made and applies for the rest of the
198.28duration of the district, regardless of whether the city qualifies or ceases to qualify as a
198.29small city.
198.30(d) A project qualifies as a workforce housing project under this subdivision if:
199.1(1) increments from the district are used exclusively to assist in the acquisition of
199.2property; construction of improvements; and provision of loans or subsidies, grants, interest
199.3rate subsidies, public infrastructure, and related financing costs for rental housing
199.4developments in the municipality; and
199.5(2) the governing body of the municipality made the findings for the project required
199.6by section 469.175, subdivision 3, paragraph (f).
199.7EFFECTIVE DATE.This section is effective for districts for which the request for
199.8certification was made after June 30, 2017.

199.9    Sec. 4. Minnesota Statutes 2016, section 469.1761, is amended by adding a subdivision
199.10to read:
199.11    Subd. 5. Income limits; Minnesota Housing Finance Agency challenge program.
199.12For a project receiving a loan or grant from the Minnesota Housing Finance Agency challenge
199.13program under section 462A.33, the income limits under section 462A.33 are substituted
199.14for the applicable income limits for the project under subdivision 2 or 3.
199.15EFFECTIVE DATE.This section is effective for districts for which the request for
199.16certification was made after June 30, 2017.

199.17    Sec. 5. Minnesota Statutes 2016, section 469.1763, subdivision 1, is amended to read:
199.18    Subdivision 1. Definitions. (a) For purposes of this section, the following terms have
199.19the meanings given.
199.20(b) "Activities" means acquisition of property, clearing of land, site preparation, soils
199.21correction, removal of hazardous waste or pollution, installation of utilities, construction
199.22of public or private improvements, and other similar activities, but only to the extent that
199.23tax increment revenues may be spent for such purposes under other law.
199.24(c) "Third party" means an entity other than (1) the person receiving the benefit of
199.25assistance financed with tax increments, or (2) the municipality or the development authority
199.26or other person substantially under the control of the municipality.
199.27(d) "Revenues derived from tax increments paid by properties in the district" means only
199.28tax increment as defined in section 469.174, subdivision 25, clause (1), and does not include
199.29tax increment as defined in section 469.174, subdivision 25, clauses (2), (3), and (4) to (5).
199.30EFFECTIVE DATE.This section is effective the day following final enactment.

200.1    Sec. 6. Minnesota Statutes 2016, section 469.1763, subdivision 2, is amended to read:
200.2    Subd. 2. Expenditures outside district. (a) For each tax increment financing district,
200.3an amount equal to at least 75 percent of the total revenue derived from tax increments paid
200.4by properties in the district must be expended on activities in the district or to pay bonds,
200.5to the extent that the proceeds of the bonds were used to finance activities in the district or
200.6to pay, or secure payment of, debt service on credit enhanced bonds. For districts, other
200.7than redevelopment districts for which the request for certification was made after June 30,
200.81995, the in-district percentage for purposes of the preceding sentence is 80 percent. Not
200.9more than 25 percent of the total revenue derived from tax increments paid by properties
200.10in the district may be expended, through a development fund or otherwise, on activities
200.11outside of the district but within the defined geographic area of the project except to pay,
200.12or secure payment of, debt service on credit enhanced bonds. For districts, other than
200.13redevelopment districts for which the request for certification was made after June 30, 1995,
200.14the pooling percentage for purposes of the preceding sentence is 20 percent. The revenue
200.15revenues derived from tax increments for paid by properties in the district that are expended
200.16on costs under section 469.176, subdivision 4h, paragraph (b), may be deducted first before
200.17calculating the percentages that must be expended within and without the district.
200.18    (b) In the case of a housing district, a housing project, as defined in section 469.174,
200.19subdivision 11
, is an activity in the district.
200.20    (c) All administrative expenses are for activities outside of the district, except that if the
200.21only expenses for activities outside of the district under this subdivision are for the purposes
200.22described in paragraph (d), administrative expenses will be considered as expenditures for
200.23activities in the district.
200.24    (d) The authority may elect, in the tax increment financing plan for the district, to increase
200.25by up to ten percentage points the permitted amount of expenditures for activities located
200.26outside the geographic area of the district under paragraph (a). As permitted by section
200.27469.176, subdivision 4k , the expenditures, including the permitted expenditures under
200.28paragraph (a), need not be made within the geographic area of the project. Expenditures
200.29that meet the requirements of this paragraph are legally permitted expenditures of the district,
200.30notwithstanding section 469.176, subdivisions 4b, 4c, and 4j. To qualify for the increase
200.31under this paragraph, the expenditures must:
200.32    (1) be used exclusively to assist housing that meets the requirement for a qualified
200.33low-income building, as that term is used in section 42 of the Internal Revenue Code; and
201.1    (2) not exceed the qualified basis of the housing, as defined under section 42(c) of the
201.2Internal Revenue Code, less the amount of any credit allowed under section 42 of the Internal
201.3Revenue Code; and
201.4    (3) be used to:
201.5    (i) acquire and prepare the site of the housing;
201.6    (ii) acquire, construct, or rehabilitate the housing; or
201.7    (iii) make public improvements directly related to the housing; or
201.8(4) be used to develop housing:
201.9(i) if the market value of the housing does not exceed the lesser of:
201.10(A) 150 percent of the average market value of single-family homes in that municipality;
201.11or
201.12(B) $200,000 for municipalities located in the metropolitan area, as defined in section
201.13473.121 , or $125,000 for all other municipalities; and
201.14(ii) if the expenditures are used to pay the cost of site acquisition, relocation, demolition
201.15of existing structures, site preparation, and pollution abatement on one or more parcels, if
201.16the parcel contains a residence containing one to four family dwelling units that has been
201.17vacant for six or more months and is in foreclosure as defined in section 325N.10, subdivision
201.187
, but without regard to whether the residence is the owner's principal residence, and only
201.19after the redemption period has expired.
201.20(e) The authority under paragraph (d), clause (4), expires on December 31, 2016.
201.21Increments may continue to be expended under this authority after that date, if they are used
201.22to pay bonds or binding contracts that would qualify under subdivision 3, paragraph (a), if
201.23December 31, 2016, is considered to be the last date of the five-year period after certification
201.24under that provision.
201.25EFFECTIVE DATE.This section is effective the day following final enactment.

201.26    Sec. 7. Minnesota Statutes 2016, section 469.1763, subdivision 3, is amended to read:
201.27    Subd. 3. Five-year rule. (a) Revenues derived from tax increments paid by properties
201.28in the district are considered to have been expended on an activity within the district under
201.29subdivision 2 only if one of the following occurs:
201.30(1) before or within five years after certification of the district, the revenues are actually
201.31paid to a third party with respect to the activity;
202.1(2) bonds, the proceeds of which must be used to finance the activity, are issued and
202.2sold to a third party before or within five years after certification, the revenues are spent to
202.3repay the bonds, and the proceeds of the bonds either are, on the date of issuance, reasonably
202.4expected to be spent before the end of the later of (i) the five-year period, or (ii) a reasonable
202.5temporary period within the meaning of the use of that term under section 148(c)(1) of the
202.6Internal Revenue Code, or are deposited in a reasonably required reserve or replacement
202.7fund;
202.8(3) binding contracts with a third party are entered into for performance of the activity
202.9before or within five years after certification of the district and the revenues are spent under
202.10the contractual obligation;
202.11(4) costs with respect to the activity are paid before or within five years after certification
202.12of the district and the revenues are spent to reimburse a party for payment of the costs,
202.13including interest on unreimbursed costs; or
202.14(5) expenditures are made for housing purposes as permitted by subdivision 2, paragraphs
202.15(b) and (d), or for public infrastructure purposes within a zone as permitted by subdivision
202.162, paragraph (e).
202.17(b) For purposes of this subdivision, bonds include subsequent refunding bonds if the
202.18original refunded bonds meet the requirements of paragraph (a), clause (2).
202.19(c) For a redevelopment district or a renewal and renovation district certified after June
202.2030, 2003, and before April 20, 2009, the five-year periods described in paragraph (a) are
202.21extended to ten years after certification of the district. For a redevelopment district certified
202.22after April 20, 2009, and before June 30, 2012, the five-year periods described in paragraph
202.23(a) are extended to eight years after certification of the district. This extension is provided
202.24primarily to accommodate delays in development activities due to unanticipated economic
202.25circumstances.
202.26EFFECTIVE DATE.This section is effective the day following final enactment.

202.27    Sec. 8. Minnesota Statutes 2016, section 469.178, subdivision 7, is amended to read:
202.28    Subd. 7. Interfund loans. (a) The authority or municipality may advance or loan money
202.29to finance expenditures under section 469.176, subdivision 4, from its general fund or any
202.30other fund under which it has legal authority to do so.
202.31    (b) Not later than 60 days after money is transferred, advanced, or spent, whichever is
202.32earliest, the loan or advance must be authorized, by resolution of the governing body or of
203.1the authority, whichever has jurisdiction over the fund from which the advance or loan is
203.2authorized, before money is transferred, advanced, or spent, whichever is earliest.
203.3    (c) The resolution may generally grant to the municipality or the authority the power to
203.4make interfund loans under one or more tax increment financing plans or for one or more
203.5districts. The resolution may be adopted before or after the adoption of the tax increment
203.6financing plan or the creation of the tax increment financing district from which the advance
203.7or loan is to be repaid.
203.8    (d) The terms and conditions for repayment of the loan must be provided in writing and.
203.9The written terms and conditions may be in any form, but must include, at a minimum, the
203.10principal amount, the interest rate, and maximum term. Written terms may be modified or
203.11amended in writing by the municipality or the authority before the latest decertification of
203.12any tax increment financing district from which the interfund loan is to be repaid. The
203.13maximum rate of interest permitted to be charged is limited to the greater of the rates
203.14specified under section 270C.40 or 549.09 as of the date the loan or advance is authorized,
203.15unless the written agreement states that the maximum interest rate will fluctuate as the
203.16interest rates specified under section 270C.40 or 549.09 are from time to time adjusted.
203.17Loans or advances may be structured as draw-down or line-of-credit obligations of the
203.18lending fund.
203.19    (e) The authority shall report in the annual report submitted under section 469.175,
203.20subdivision 6:
203.21    (1) the amount of any interfund loan or advance made in a calendar year; and
203.22    (2) any amendment of an interfund loan or advance made in a calendar year.
203.23EFFECTIVE DATE.This section is effective the day following final enactment and
203.24applies to all districts, regardless of when the request for certification was made.

203.25    Sec. 9. Laws 2008, chapter 154, article 9, section 21, subdivision 2, is amended to read:
203.26    Subd. 2. Special rules. (a) If the city elects, upon the adoption of the tax increment
203.27financing plan for a district, the rules under this section apply to a redevelopment district,
203.28renewal and renovation district, economic development district, soil condition district, or
203.29a soil deficiency district established by the city or a development authority of the city in the
203.30project area.
203.31    (b) Prior to or upon the adoption of the first tax increment plan subject to the special
203.32rules under this subdivision, the city must find by resolution that parcels consisting of at
204.1least 80 percent of the acreage of the project area (excluding street and railroad right of
204.2way) are characterized by one or more of the following conditions:
204.3    (1) peat or other soils with geotechnical deficiencies that impair development of
204.4residential or commercial buildings or infrastructure;
204.5    (2) soils or terrain that requires substantial filling in order to permit the development of
204.6commercial or residential buildings or infrastructure;
204.7    (3) landfills, dumps, or similar deposits of municipal or private waste;
204.8    (4) quarries or similar resource extraction sites;
204.9    (5) floodway; and
204.10    (6) substandard buildings within the meaning of Minnesota Statutes, section 469.174,
204.11subdivision 10
.
204.12    (c) For the purposes of paragraph (b), clauses (1) through (5), a parcel is deemed to be
204.13characterized by the relevant condition if at least 70 percent of the area of the parcel contains
204.14the relevant condition. For the purposes of paragraph (b), clause (6), a parcel is deemed to
204.15be characterized by substandard buildings if the buildings occupy at least 30 percent of the
204.16area of the parcel.
204.17    (d) The five-year rule under Minnesota Statutes, section 469.1763, subdivision 3, is
204.18extended to ten years for any district, and section 469.1763, subdivision 4, does not apply
204.19to any district.
204.20    (e) Notwithstanding anything to the contrary in section 469.1763, subdivision 2, paragraph
204.21(a), not more than 80 percent of the total revenue derived from tax increments paid by
204.22properties in any district (measured over the life of the district) may be expended on activities
204.23outside the district but within the project area.
204.24    (f) For a soil deficiency district:
204.25    (1) increments may be collected through 20 years after the receipt by the authority of
204.26the first increment from the district; and
204.27    (2) except as otherwise provided in this subdivision, increments may be used only to:
204.28    (i) acquire parcels on which the improvements described in item (ii) will occur;
204.29    (ii) pay for the cost of correcting the unusual terrain or soil deficiencies and the additional
204.30cost of installing public improvements directly caused by the deficiencies; and
204.31    (iii) pay for the administrative expenses of the authority allocable to the district.
205.1    (g) Increments spent for any infrastructure costs, whether inside a district or outside a
205.2district but within the project area, are deemed to satisfy the requirements of paragraph (f)
205.3and Minnesota Statutes, section 469.176, subdivisions 4b, 4c, and 4j.
205.4    (h) Increments from any district may not be used to pay the costs of landfill closure or
205.5public infrastructure located on the following parcels within the plat known as Burnsville
205.6Amphitheater: Lot 1, Block 1; Lots 1 and 2, Block 2; and Outlots A, B, C and D.
205.7    (i) The four-year rule under Minnesota Statutes, section 469.176, subdivision 6, is
205.8extended to nine years.
205.9    (j) The city may specify in the tax increment financing plan for any district the first year
205.10in which it elects to receive increment, which may be up to eight years following approval
205.11of the district.
205.12    (k) Notwithstanding Minnesota Statutes, section 469.176, subdivision 1b, paragraph (c),
205.13the city may waive any increment received in 2017 and, if so, it shall not be used in
205.14determining the duration limit for any district created under this section.
205.15    (l) The authority to approve tax increment financing plans to establish tax increment
205.16financing districts under this section expires on December 31, 2018 March 20, 2023.
205.17EFFECTIVE DATE.This section is effective upon approval by the governing body
205.18of the city of Burnsville and compliance with the requirements of Minnesota Statutes, section
205.19645.021.

205.20    Sec. 10. Laws 2009, chapter 88, article 5, section 17, as amended by Laws 2010, chapter
205.21382, section 84, is amended to read:
205.22    Sec. 17. SEAWAY PORT AUTHORITY OF DULUTH; TAX INCREMENT
205.23FINANCING DISTRICT; SPECIAL RULES.
205.24(a) If the Seaway Port Authority of Duluth adopts a tax increment financing plan and
205.25the governing body of the city of Duluth approves the plan for the tax increment financing
205.26district consisting of one or more parcels identified as: 010-2730-00010; 010-2730-00020;
205.27010-2730-00040; 010-2730-00050; 010-2730-00070; 010-2730-00080; 010-2730-00090;
205.28010-2730-00100; 010-02730-00120; 010-02730-00130; 010-02730-00140; 010-2730-00160;
205.29010-2730-00180; 010-2730-00200; 010-2730-00300; 010-02730-00320; 010-2746-01250;
205.30010-2746-1330; 010-2746-01340; 010-2746-01350; 010-2746-1440; 010-2746-1380;
205.31010-2746-01490; 010-2746-01500; 010-2746-01510; 010-2746-01520; 010-2746-01530;
205.32010-2746-01540; 010-2746-01550; 010-2746-01560; 010-2746-01570; 010-2746-01580;
205.33010-2746-01590; 010-3300-4560; 010-3300-4565; 010-3300-04570; 010-3300-04580;
206.1010-3300-04640; 010-3300-04645; and 010-3300-04650, the five-year rule under Minnesota
206.2Statutes, section 469.1763, subdivision 3, that activities must be undertaken within a five-year
206.3period from the date of certification of the tax increment financing district, must be
206.4considered to be met if the activities are undertaken within five years after the date all
206.5qualifying parcels are delisted from the Federal Superfund list.
206.6(b) The requirements of Minnesota Statutes, section 469.1763, subdivision 4, beginning
206.7in the sixth year following certification of the district requirement, will begin in the sixth
206.8year following the date all qualifying parcels are delisted from the Federal Superfund list.
206.9(c) The action required under Minnesota Statutes, section 469.176, subdivision 6, are
206.10satisfied if the action is commenced within four years after the date all qualifying parcels
206.11are delisted from the Federal Superfund list and evidence of the action required is submitted
206.12to the county auditor by February 1 of the fifth year following the year in which all qualifying
206.13parcels are delisted from the Federal Superfund list.
206.14(d) For purposes of this section, "qualifying parcels" means United States Steel parcels
206.15listed in paragraph (a) and shown by the Minnesota Pollution Control Agency as part of the
206.16USS St. Louis River-U.S. Steel Superfund Site (USEPA OU 02) that are included in the
206.17tax increment financing district.
206.18(e) In addition to the reporting requirements of Minnesota Statutes, section 469.175,
206.19subdivision 5
, the Seaway Port Authority of Duluth shall report the status of all parcels
206.20listed in paragraph (a) and shown as part of the USS St. Louis River-U.S. Steel Superfund
206.21Site (USEPA OU 02). The status report must show the parcel numbers, the listed or delisted
206.22status, and if delisted, the delisting date.
206.23(f) Notwithstanding Minnesota Statutes, section 469.178, subdivision 7, or any other
206.24law to the contrary, the Seaway Port Authority of Duluth may establish an interfund loan
206.25program before approval of the tax increment financing plan for or the establishment of the
206.26district authorized by this section. The authority may make loans under this program. The
206.27proceeds of the loans may be used for any permitted use of increments under this law or
206.28Minnesota Statutes, section 469.176, for the district and may be repaid with increments
206.29from the district established under this section. This paragraph applies to any action
206.30authorized by the Seaway Port Authority of Duluth on or after March 25, 2010.
206.31EFFECTIVE DATE.This section is effective the day after the governing body of the
206.32city of Duluth and its chief clerical officer comply with Minnesota Statutes, section 645.021,
206.33subdivision 3.

207.1    Sec. 11. Laws 2014, chapter 308, article 6, section 8, subdivision 1, is amended to read:
207.2    Subdivision 1. Authority to create districts. (a) The governing body of the city of
207.3Edina or its development authority may establish one or more tax increment financing
207.4housing districts in the Southeast Edina Redevelopment Project Area, as the boundaries
207.5exist on March 31, 2014.
207.6(b) The authority to request certification of districts under this section expires on June
207.730, 2017 2020.
207.8EFFECTIVE DATE.This section is effective on the day following final enactment
207.9without local approval under Minnesota Statutes, section 645.023, subdivision 1, paragraph
207.10(a).

207.11    Sec. 12. Laws 2014, chapter 308, article 6, section 9, is amended to read:
207.12    Sec. 9. CITY OF MAPLE GROVE; TAX INCREMENT FINANCING DISTRICT.
207.13    Subdivision 1. Definiti