Bill Text: MN HF3036 | 2013-2014 | 88th Legislature | Introduced
Bill Title: Transportation Department exempted from sales tax payment and sales tax amounts appropriation to be paid to contractors provided; motor vehicle lease sales tax revenue distribution adjusted; and replacement service operation costs payment formula amended.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced - Dead) 2014-03-13 - Introduction and first reading, referred to Transportation Finance [HF3036 Detail]
Download: Minnesota-2013-HF3036-Introduced.html
1.2relating to transportation; exempting the Department of Transportation from
1.3payment of sales tax and providing for appropriation of sales tax amounts to
1.4be paid to contractors; adjusting distribution of motor vehicle lease sales tax
1.5revenues; amending formula for payment of replacement service operation costs;
1.6amending Minnesota Statutes 2012, section 473.388, subdivision 4; Minnesota
1.7Statutes 2013 Supplement, sections 297A.70, subdivision 2; 297A.815,
1.8subdivision 3; proposing coding for new law in Minnesota Statutes, chapter 161.
1.9BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.10 Section 1. [161.087] BUDGET SUBMISSION FOR SALES TAX PAYMENTS
1.11TO CONTRACTORS.
1.12In each biennial budget submission, the commissioner shall specify the amounts
1.13estimated to be paid to contractors and subcontractors in the biennium that are attributable
1.14to sales tax for materials purchased by contractors and subcontractors under lump sum
1.15contracts or similar types of contracts that contain a guaranteed maximum price covering
1.16both labor and materials for use in the construction, reconstruction, improvement,
1.17or maintenance of trunk highways. The legislature shall include these amounts in
1.18appropriations for Department of Transportation state road construction.
1.19 Sec. 2. Minnesota Statutes 2013 Supplement, section 297A.70, subdivision 2, is
1.20amended to read:
1.21 Subd. 2. Sales to government. (a) All sales, except those listed in paragraph (b),
1.22to the following governments and political subdivisions, or to the listed agencies or
1.23instrumentalities of governments and political subdivisions, are exempt:
1.24(1) the United States and its agencies and instrumentalities;
2.1(2) school districts, local governments, the University of Minnesota, state universities,
2.2community colleges, technical colleges, state academies, the Perpich Minnesota Center for
2.3Arts Education, and an instrumentality of a political subdivision that is accredited as an
2.4optional/special function school by the North Central Association of Colleges and Schools;
2.5(3) hospitals and nursing homes owned and operated by political subdivisions of
2.6the state of tangible personal property and taxable services used at or by hospitals and
2.7nursing homes;
2.8(4) the Metropolitan Council, for its purchases of vehicles and repair parts to equip
2.9operations provided for in section473.4051 ;
2.10(5) other states or political subdivisions of other states, if the sale would be exempt
2.11from taxation if it occurred in that state;and
2.12(6) public libraries, public library systems, multicounty, multitype library systems
2.13as defined in section134.001 , county law libraries under chapter 134A, state agency
2.14libraries, the state library under section480.09 , and the Legislative Reference Library; and
2.15(7) the Department of Transportation.
2.16(b) This exemption does not apply to the sales of the following products and services:
2.17(1) building, construction, or reconstruction materials purchased by a contractor
2.18or a subcontractor as a part of a lump-sum contract or similar type of contract with a
2.19guaranteed maximum price covering both labor and materials for use in the construction,
2.20alteration, or repair of a building or facility;
2.21(2) construction materials purchased by tax exempt entities or their contractors to
2.22be used in constructing buildings or facilities which will not be used principally by the
2.23tax exempt entities;
2.24(3) the leasing of a motor vehicle as defined in section297B.01, subdivision 11 ,
2.25except for leases entered into by the United States or its agencies or instrumentalities;
2.26(4) lodging as defined under section297A.61, subdivision 3 , paragraph (g), clause
2.27(2), and prepared food, candy, soft drinks, and alcoholic beverages as defined in section
2.28297A.67, subdivision 2
, except for lodging, prepared food, candy, soft drinks, and alcoholic
2.29beverages purchased directly by the United States or its agencies or instrumentalities; or
2.30(5) goods or services purchased by a local government as inputs to goods and
2.31services that are generally provided by a private business and the purchases would be
2.32taxable if made by a private business engaged in the same activity.
2.33(c) As used in this subdivision, "school districts" means public school entities and
2.34districts of every kind and nature organized under the laws of the state of Minnesota, and
2.35any instrumentality of a school district, as defined in section471.59 .
3.1(d) As used in this subdivision, "local governments" means cities, counties, and
3.2townships.
3.3(e) As used in this subdivision, "goods or services generally provided by a private
3.4business" include, but are not limited to, goods or services provided by liquor stores, gas
3.5and electric utilities, golf courses, marinas, health and fitness centers, campgrounds, cafes,
3.6and laundromats. "Goods or services generally provided by a private business" do not
3.7include housing services, sewer and water services, wastewater treatment, ambulance and
3.8other public safety services, correctional services, chore or homemaking services provided
3.9to elderly or disabled individuals, or road and street maintenance or lighting.
3.10EFFECTIVE DATE.This section is effective July 1, 2014, and applies to sales and
3.11purchases on or after that date.
3.12 Sec. 3. Minnesota Statutes 2013 Supplement, section 297A.815, subdivision 3, is
3.13amended to read:
3.14 Subd. 3. Motor vehicle lease sales tax revenue. (a)For purposes of this
3.15subdivision, "net revenue" means an amount equal to:
3.16(1) the revenues, including interest and penalties, collected under this section, during
3.17the fiscal year; less
3.18(2) in fiscal year 2011, $30,100,000; in fiscal year 2012, $31,100,000; and in fiscal
3.19year 2013 and following fiscal years, $32,000,000.
3.20(b) On or before June 30 of each fiscal year, the commissioner of revenue shall
3.21estimate the amount of the revenuesand subtraction under paragraph (a) for the current
3.22fiscal year, including interest and penalties, collected under this section during the fiscal
3.23year.
3.24(c) (b) On or after July 1 of the subsequent fiscal year, the commissioner of
3.25management and budget shall transfer thenet revenue revenues as estimated in paragraph
3.26(b) (a) from the general fund, as follows:
3.27 (1)$9,000,000 annually until January 1, 2016, and $32,000,000 to the county
3.28state-aid highway fund;
3.29 (2) 50 percentannually thereafter of the remainder to the county state-aid highway
3.30fund, subject to the following limitation. Notwithstanding any other law to the contrary,
3.31the commissioner of transportation shall allocate the funds transferred under this clause
3.32to the counties in the metropolitan area, as defined in section473.121 , subdivision 4,
3.33excluding the counties of Hennepin and Ramsey, so that each county shall receive of such
3.34amount the percentage that its population, as defined in section477A.011 , subdivision 3,
4.1estimated or established by July 15 of the year prior to the current calendar year, bears to
4.2the total population of the counties receiving funds under this clause; and
4.3(2) the remainder (3) remaining revenues to the greater Minnesota transit account.
4.4EFFECTIVE DATE.This section is effective July 1, 2014, and applies to sales and
4.5purchases on or after that date.
4.6 Sec. 4. Minnesota Statutes 2012, section 473.388, subdivision 4, is amended to read:
4.7 Subd. 4. Financial assistance. (a) The council must grant the requested financial
4.8assistance if it determines that the proposed service is intended to replace the service to
4.9the applying city or town or combination thereof by the council and that the proposed
4.10service will meet the needs of the applicant at least as efficiently and effectively as the
4.11existing service.
4.12 (b) The amount of assistance which the council must provide to a system under this
4.13section may not be less than the sum of the amounts determined for each municipality
4.14comprising the system as follows:
4.15 (1) the transit operating assistance grants received under this subdivision by the
4.16municipality in calendar year 2001 or the tax revenues for transit services levied by the
4.17municipality for taxes payable in 2001, including that portion of the levy derived from
4.18the areawide pool under section473F.08, subdivision 3 , clause (a), plus the portion of
4.19the municipality's aid under section273.1398, subdivision 2 , attributable to the transit
4.20levy; times
4.21 (2) the ratio of (i) an amount equal to3.74 4.5 percent of the state revenues generated
4.22from the taxes imposed under chapter 297B for the current fiscal year to (ii) the total
4.23transit operating assistance grants received under this subdivision in calendar year 2001 or
4.24the tax revenues for transit services levied by all replacement service municipalities under
4.25this section for taxes payable in 2001, including that portion of the levy derived from
4.26the areawide pool under section473F.08, subdivision 3 , clause (a), plus the portion of
4.27homestead and agricultural credit aid under section273.1398, subdivision 2 , attributable
4.28to nondebt transit levies, times
4.29 (3) the ratio of (i) the municipality's total taxable market value for taxes payable
4.30in 2006 divided by the municipality's total taxable market value for taxes payable in
4.312001, to (ii) the total taxable market value of all property located in replacement service
4.32municipalities for taxes payable in 2006 divided by the total taxable market value of all
4.33property located in replacement service municipalities for taxes payable in 2001.
4.34 (c) The council shall pay the amount to be provided to the recipient from the funds
4.35the council receives in the metropolitan area transit account under section16A.88 .
5.1EFFECTIVE DATE.This section is effective July 1, 2014.
1.3payment of sales tax and providing for appropriation of sales tax amounts to
1.4be paid to contractors; adjusting distribution of motor vehicle lease sales tax
1.5revenues; amending formula for payment of replacement service operation costs;
1.6amending Minnesota Statutes 2012, section 473.388, subdivision 4; Minnesota
1.7Statutes 2013 Supplement, sections 297A.70, subdivision 2; 297A.815,
1.8subdivision 3; proposing coding for new law in Minnesota Statutes, chapter 161.
1.9BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.10 Section 1. [161.087] BUDGET SUBMISSION FOR SALES TAX PAYMENTS
1.11TO CONTRACTORS.
1.12In each biennial budget submission, the commissioner shall specify the amounts
1.13estimated to be paid to contractors and subcontractors in the biennium that are attributable
1.14to sales tax for materials purchased by contractors and subcontractors under lump sum
1.15contracts or similar types of contracts that contain a guaranteed maximum price covering
1.16both labor and materials for use in the construction, reconstruction, improvement,
1.17or maintenance of trunk highways. The legislature shall include these amounts in
1.18appropriations for Department of Transportation state road construction.
1.19 Sec. 2. Minnesota Statutes 2013 Supplement, section 297A.70, subdivision 2, is
1.20amended to read:
1.21 Subd. 2. Sales to government. (a) All sales, except those listed in paragraph (b),
1.22to the following governments and political subdivisions, or to the listed agencies or
1.23instrumentalities of governments and political subdivisions, are exempt:
1.24(1) the United States and its agencies and instrumentalities;
2.1(2) school districts, local governments, the University of Minnesota, state universities,
2.2community colleges, technical colleges, state academies, the Perpich Minnesota Center for
2.3Arts Education, and an instrumentality of a political subdivision that is accredited as an
2.4optional/special function school by the North Central Association of Colleges and Schools;
2.5(3) hospitals and nursing homes owned and operated by political subdivisions of
2.6the state of tangible personal property and taxable services used at or by hospitals and
2.7nursing homes;
2.8(4) the Metropolitan Council, for its purchases of vehicles and repair parts to equip
2.9operations provided for in section
2.10(5) other states or political subdivisions of other states, if the sale would be exempt
2.11from taxation if it occurred in that state;
2.12(6) public libraries, public library systems, multicounty, multitype library systems
2.13as defined in section
2.14libraries, the state library under section
2.15(7) the Department of Transportation.
2.16(b) This exemption does not apply to the sales of the following products and services:
2.17(1) building, construction, or reconstruction materials purchased by a contractor
2.18or a subcontractor as a part of a lump-sum contract or similar type of contract with a
2.19guaranteed maximum price covering both labor and materials for use in the construction,
2.20alteration, or repair of a building or facility;
2.21(2) construction materials purchased by tax exempt entities or their contractors to
2.22be used in constructing buildings or facilities which will not be used principally by the
2.23tax exempt entities;
2.24(3) the leasing of a motor vehicle as defined in section
2.25except for leases entered into by the United States or its agencies or instrumentalities;
2.26(4) lodging as defined under section
2.27(2), and prepared food, candy, soft drinks, and alcoholic beverages as defined in section
2.29beverages purchased directly by the United States or its agencies or instrumentalities; or
2.30(5) goods or services purchased by a local government as inputs to goods and
2.31services that are generally provided by a private business and the purchases would be
2.32taxable if made by a private business engaged in the same activity.
2.33(c) As used in this subdivision, "school districts" means public school entities and
2.34districts of every kind and nature organized under the laws of the state of Minnesota, and
2.35any instrumentality of a school district, as defined in section
3.1(d) As used in this subdivision, "local governments" means cities, counties, and
3.2townships.
3.3(e) As used in this subdivision, "goods or services generally provided by a private
3.4business" include, but are not limited to, goods or services provided by liquor stores, gas
3.5and electric utilities, golf courses, marinas, health and fitness centers, campgrounds, cafes,
3.6and laundromats. "Goods or services generally provided by a private business" do not
3.7include housing services, sewer and water services, wastewater treatment, ambulance and
3.8other public safety services, correctional services, chore or homemaking services provided
3.9to elderly or disabled individuals, or road and street maintenance or lighting.
3.10EFFECTIVE DATE.This section is effective July 1, 2014, and applies to sales and
3.11purchases on or after that date.
3.12 Sec. 3. Minnesota Statutes 2013 Supplement, section 297A.815, subdivision 3, is
3.13amended to read:
3.14 Subd. 3. Motor vehicle lease sales tax revenue. (a)
3.15
3.16
3.17
3.18
3.19
3.20
3.21estimate the amount of the revenues
3.22
3.23year.
3.24
3.25management and budget shall transfer the
3.26
3.27 (1)
3.28state-aid highway fund;
3.29 (2) 50 percent
3.30fund, subject to the following limitation. Notwithstanding any other law to the contrary,
3.31the commissioner of transportation shall allocate the funds transferred under this clause
3.32to the counties in the metropolitan area, as defined in section
3.33excluding the counties of Hennepin and Ramsey, so that each county shall receive of such
3.34amount the percentage that its population, as defined in section
4.1estimated or established by July 15 of the year prior to the current calendar year, bears to
4.2the total population of the counties receiving funds under this clause; and
4.3
4.4EFFECTIVE DATE.This section is effective July 1, 2014, and applies to sales and
4.5purchases on or after that date.
4.6 Sec. 4. Minnesota Statutes 2012, section 473.388, subdivision 4, is amended to read:
4.7 Subd. 4. Financial assistance. (a) The council must grant the requested financial
4.8assistance if it determines that the proposed service is intended to replace the service to
4.9the applying city or town or combination thereof by the council and that the proposed
4.10service will meet the needs of the applicant at least as efficiently and effectively as the
4.11existing service.
4.12 (b) The amount of assistance which the council must provide to a system under this
4.13section may not be less than the sum of the amounts determined for each municipality
4.14comprising the system as follows:
4.15 (1) the transit operating assistance grants received under this subdivision by the
4.16municipality in calendar year 2001 or the tax revenues for transit services levied by the
4.17municipality for taxes payable in 2001, including that portion of the levy derived from
4.18the areawide pool under section
4.19the municipality's aid under section
4.20levy; times
4.21 (2) the ratio of (i) an amount equal to
4.22from the taxes imposed under chapter 297B for the current fiscal year to (ii) the total
4.23transit operating assistance grants received under this subdivision in calendar year 2001 or
4.24the tax revenues for transit services levied by all replacement service municipalities under
4.25this section for taxes payable in 2001, including that portion of the levy derived from
4.26the areawide pool under section
4.27homestead and agricultural credit aid under section
4.28to nondebt transit levies, times
4.29 (3) the ratio of (i) the municipality's total taxable market value for taxes payable
4.30in 2006 divided by the municipality's total taxable market value for taxes payable in
4.312001, to (ii) the total taxable market value of all property located in replacement service
4.32municipalities for taxes payable in 2006 divided by the total taxable market value of all
4.33property located in replacement service municipalities for taxes payable in 2001.
4.34 (c) The council shall pay the amount to be provided to the recipient from the funds
4.35the council receives in the metropolitan area transit account under section
5.1EFFECTIVE DATE.This section is effective July 1, 2014.
