HomeMy WebLinkAbout12.E.1. Unfunded Mandates
ll. E. I.
CITY OF SHAKO PEE
Memorandum
TO: Mayor and City Council
FROM: Mark McNeill, City Administrator
SUBJECT: Unfunded Mandates
DATE: February l6, 2006
INTRODUCTION:
The Council is asked to adopt a list of prioritized unfunded mandates, which will be
relayed by SCALE to the State Auditor.
BACKGROUND:
The Minnesota Legislature has on many occasions passed laws which are required to be
implemented by local jurisdictions, but for which no funding assistance has been
provided. These are commonly referred to as "unfunded mandates".
Various city and county advocacy groups have on occasion relayed their displeasure to
legislators at having to provide for these unfunded mandates. Recently, the State Auditor
requested local jurisdictions to provide her with a list of the unfunded mandates that
should either be eliminated, or for which funding should be provided (there is no
guarantee, of course, that either of those scenarios would ever happen, or even be
considered). This was discussed at a recent SCALE meeting, and it was the consensus of
those present that rather than to provide individual lists, SCALE would act as a
communicator of a centralized listing of unfunded mandates.
The Association of Minnesota Counties provided a list of unfunded mandates to its
members. The League of Minnesota Cities has also provided a copy of mandates to
member cities (attached). Note that because of the inherently different responsibilities
between counties and cities, it might be more generally characterized that the mandates
for counties deal with the direct provision of services - welfare, recording of legal
documents, and the like. Conversely, many (but not all)ofthe mandates with which
cities have to deal relate to reporting requirements. While burdensome, it is more
difficult to attach costs to those.
Staff have reviewed the attached LMC list, and have listed (as attachment A) the ones
which staff feels are the most onerous. Note that we have considered the political reality
of what we would like to see changed - for example, State and Federal OSHA standards
requirement that a minimum oftwo employees are present when a confined space (such
asa manhole) is entered. However, that is a common sense law, and no one would ever
advocate for its elimination. This is an example of an unfunded mandate which,
regardless of how imposed, is one of the core missions of that local government provides.
Finally, there are laws which have become political realities, and the push to repeal those
is just not a good investment of time.
Note that this only deals with unfunded mandates. The issues of elimination of Local
Government Aid, and the failure to pay to the cities Market Value Homestead Credit, are
separate from what is being considered here.
RELATIONSHIP TO VISIONING:
As most of these unfunded mandates relate to funding shortfalls, the adoption of these
priorities would relate to the City's Goal E "financially strong".
RECOMMENDATION:
I recommend that these mandates (plus any others that the City Council may wish to so
designate) be adopted, and be directed to be sent for inclusion with the SCALE listing.
ACTION REQUIRED:
If the Council concurs, it should adopt a prioritized list of unfunded mandates for which it
would like to see either funding or abolition, and direct these to be forwarded to the Scott
County Association of Leadership and Efficiency.
.~~)U~
Mark McNeill
City Administrator
ATTACHMENT A
Shakopee Priorities
PUBLIC SAFETY
Continued health insurance for iniured public safety officers (M.S. 229A.465) -Cities are required
to continue health benefits to police officers and firefighters injured in the line of duty,
initially, the state reimbursed cities for the full costs of complying with this requirement.
Since 2003, the state has pro-rated reimbursements to affected cities based on the amount
available and the number of eligible applicants. The 2003 law change resulted in significant
and unanticipated costs to cities. (Note: Shakopee has four former officers on this
coverage, for which the city is providing insurance).
Fine distribution(M.S. 357-021) - State law defines the distribution of fine revenues collected from
violators of state laws. Although local law enforcement costs have risen in recent years, the
portion of fine revenues distributed to cites has not been adjusted. In addition. Steep
increases in state-imposed traffic citation surcharges have resulted in more court challenges
to citations and thus, increased local prosecution costs. (Note: This impacts the fine
revenues turned back to the cities, which may not fully recover the costs of prosecution).
800 mhz requirements - Despite increased reliance on 911 surcharge revenues to finance the cost of
state bonds to be sold to continue to build-out of ARMER, the statewide public safety radio
communications backbone, only a small portion of that financing is available to aid cities to
build subsystems for local public safety communications that will provide interoperable
communications with other jurisdictions. To date, the Legislature has not addressed how
cities and counties will be able to afford to obtain the means necessary (communications
infrastructure improvements and portable and mobile radio equipment) to obtain such
coverage. (Note: Shako pee and the rest of Scott County would likely have had to go to the
800 Mhz system in order to stay in contact with neighboringjurisdictions, but funding has
been anissue).
BUILDING CODES
Minor residential improvements (M.S.l6B.63) - Limits permit fees to $15 or 5 percent. Whichever
is greater, for improvement, installation or replacement of a residential fixture or appliance
that does not modify electric or gas service, has a labor cost of $500 or less, and is done by
the homeowner or a licensed contractor. (Note: The limiting of permit charges may not
accurately reflect the actual cost of providing the service).
DATA PRACTICES
Job reference liability - regulates city disclosure of employment information regarding current and
former employees, requiring that disclosure procedures and policies be implemented to
assure that information provided is complete and accurate; that disclosure of information
regarding acts of violence, etc. are to be provided only in writing; that the city obtained
authorization from current or former employees to the release of such information prior to
disclosing public personnel data, evaluations conducted prior to separation and employee
responses, employee's personnel record and reasons (in writing)for employment separation;
and provide current and former employees by mail a copy of employment information
disclosed and to whom it was disclosed. (Chapter 137,2004 Session Laws). (Note: The
limiting of reference information should be the same for the public sector as it is for private
sector employers. This is not a direct cost impact mandate.)
PLANNING
State zoning standards (M.S. 463.365) - Local zoning decisions for manufactured homes, group
homes, earth-sheltered homes, etc., are limited by the state. (Note: While not a direct cost
impact mandate, these decisions should be able to be made at the local level.)
TRANSPORATION
Biodiesel fuel mandate (M.S.239.77) - Requires that fuel sold in the state after June 30, 2005, for
use in internal combustion engines, contain a minimum of two percent ofbiodiesel fuel by
volume. This requirement could increase fuel costs and/or maintenance costs for affected
vehicles. (Note: This issue afJects public and private sector. The concern is that the fuel
may not be totally comparable to "regular" diesel fuel, both in terms of peiformance and
maintenance.)
GENERAL GOVERNMENT/RECORD KEEPING
Minncor (M.S.16B181) - A 1998 law change will require the state and all political subdivisions
to purchase only from MINNCOR when purchasing the products MINNCOR produces.
This requirement is effective the year 2000 if the state and political subdivisions fail to
meet a purchasing quota - the quota has not yet been established. (Note: MINNCOR
products should have to compete with other vendors.)
Non-visual technology (M.S.16C.145) - A 1998 law mandates the state and all political
subdivisions to require all technology hardware and software purchases and upgrades to
satisfy non-visual technology standards that exceed the America Disability Act (ADA)
requirements. This mandate requires the purchase of technology that is either not yet
available or is cost prohibitive. (Note: Reasonable accommodations for disabled voters
have been provided in the past, and the mandated cost of upgrading to a new type of system
which is not yet widely available is no/warranted at this time).
TAXES
Training for local boards of review (M.S. 274.014) - Requires that at least one member ofthe local
boards of review must attend an appeals and equalization course developed or approved by
the commissioner of revenue starting January 1,2006. (Note: This is not a direct cost to
cities, but does impose a burden on the (at least) one member of the Board who must attend
training in order to become certified. StafJmembers should be able to be relied upon to
provide the technical expertise.) I
REVENUE CONSTRAINTS
Truth-in-taxation (M.S.275.065) - State law requires cities to provide pre-notification of property
tax changes, newspaper advertisements, multiple special hearings, and compliance with
state rules. Cities must certify a proposed levy amount by September 15, and with few
exceptions, are not allowed to increase this amount. Cities must also pay a proportional
share ofthe counties' costs of preparing and mailing parcel specific notices. (Note: While
the intent of the law was to provide an opportunity for taxpayers to become involved in the
budgeting process, in reality the hearings are held too late to make an impact. In addition,
at best only a couple of taxpayers appear each year, and may question things not related to
the hearing, such as property valuation.)
MISCELLANEOUS
State sales and MVET on city purchases (M.S.297 A and 297B) - Cites are required to raise,
through property taxes or fees, adequate revenue to pay the 6.5 percent sales tax on
most city purchases of goods and services. In addition, they must pay the motor vehicle
excise tax (MVET) on vehicles such as road maintenance vehicles, plows, dump trucks, etc.
(Note: This adds 6.5% to the cost of city purchases, and is in effect a "tax on a tax. ")
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145 University Avenue West, St. Paul, MN 55103-2044
Phone: (651) 281-12000 (800) 925-1122
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STATE MANDATES
AFFECTING
MINNESOTA CITIES
The following list represents a compilation of some of the state laws that directly impact city
government operations in Minnesota. The list does not represent every law that impacts city
operations nor does the list necessarily reflect the annual legislative agenda of the League of
Minnesota Cities, For additions to this list, contact Jennifer 0 'Rourke at 651.281.1261, or
jorourke@lmnc.org.
PERSONNEL/EMPLOYEE RELATIONS
Pay equity, implementation and reporting (M.S. 471.991-99) - Personnel costs have been
increased by the state requirement that cities and other local governments conduct job
evaluation studies, report on implementation, and meet equitable compensation standards
as defined in state rules
Workers' compensation (M.S.176) - Cities are responsible for enforcing state requirements for
workers' compensation for local contractors and licensees.
Public pensions - basic and coordinated plans (M.S. 353.27) - Cities are required to participate in
the state Public Employee Retirement Association (PERA), that requires city employer
contribution rates of 11.78 percent for Basic plan members and 5.53 percent for
Coordinated plan members.
Public pensions - police and fire plan (M.S. 353.65) - Cities are required to participate in the
state PERA Police and Fire Plan that requires a city employer contribution rate of9.3
percent.
Continuation of health and life insurance coverage (M.S. 62A17 and M.S. 61A092) - Cities
must comply with a state requirement to offer continued health and life insurance
coverage to former employees following voluntary or involuntary termination.
Prevailing wages paid on public contracts (M.S. 177.41 and AG. Op.415cl) - The state's Davis-
Bacon requirements (prevailing wage requirements), as interpreted by the Attorney
General, can increase the costs of city contracts.
Veterans preference (M,S. 197.447,455,46,48,481 and 192.26) - Cities are required to give
preferential treatment to veterans for hiring, protection from discharge, fully paid leave
AN EQUALOPPORTUNITY/AFFIRMA TIVE ACTION EMPLOYER
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while challenging any discharge or disciplinary action, and full salary for up to three
weeks for all city employees serving in the military reserves or on active duty.
Mandatory binding arbitration (M.S. 179A.16, .18) - Employee classes such as peace officers
and firefighters are not allowed to strike. Rather, cities are mandated to comply with
the compensation and benefit determinations of an appointed arbitrator, even if the
elected representatives of the city's residents determine that a strike would be
preferable. In 1999 the law was changed to require final-offer-total-package
arbitration for firefighters.
PUBLIC SAFETY
Peace officer standards and training (POST) (M.S. 626.84-863) - Cities are required to assure
that their public safety personnel complete mandated pre-service and continuing in-
service training to maintain licensed law enforcement officer status.
Temporary detention facilities/detoxification centers - City facilities for temporary holding of
persons who have been arrested must meet state standards for the building and its
maintenance.
Confined space entry - State and federal standards are imposed for situations where a confined
space (such as a manhole) is entered. For example, there is a requirement that a
minimum of two employees are present whenever a confined space is entered (OSHA).
Animal control (M.S. 346, 347) - State regulations set standards for facilities used for animal
control, procedures for apprehending animals and minimum holding periods.
"First responder" and firefighting by city employees on state highways - State reimbursement for
these public safety services does not adequately cover the costs of performing these
servIces.
800 megahertz radio system (M.S. 473.891-.905) - Regional public safety radio communications
system for which metro-area cities must implement plans for.
Ambulance staffing and equipment requirements - Govemed by the Emergency Medical
Services Board - most recently changed in 1999.
Suspense file reduction (M.S. 299C.l 0-ll) - Reguires peace officers and community corrections
agencies to immediately collect identifying information relating to persons arrested or
appearing in court on certain charges. Information includes fingerprints and known
aliases. Identification data must be furnished to the Bureau of Criminal Apprehension.
Continued health insurance for iniured public safety officers (M.S. 299A.465) - Cities are
required to continue health benefits to police officers and firefighters injured in the line of
duty. Initially, the state reimbursed cities for the full costs of complying with this
requirement. Since 2003, the state has pro-rated reimbursements to affected cities based
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on the amount available and the number of eligible applicants. The 2003 law change
resulted in significant and unanticipated costs to cities.
Peace officers post traumatic stress syndrome benefit (M.S. 299AAll) - Cities are required to
provide benefits to police officers and firefighters disabled by a psychological reaction to
a traumatic event that occurred in the line of duty. The law requires the employer to
provide payment of lost wages and medical treatment for up to one year.
Fine distribution (M.S. 357.021) - State law defines the distribution of fine revenues collected
from violators of state laws. Although local law enforcement costs have risen in recent
years, the portion of fine revenues distributed to cities has not been adjusted. In addition,
steep increases in state-imposed traffic citation surcharges have resulted in more court
challenges to citations and thus, increased local prosecution costs.
Notification ofliquor licensees (M.S. 340A.) - Cities are required to notify the Commissioner of
Public Safety when issuing the various liquor licenses and either have to certify to the
state or wait for approval.
Detention ofDWI suspects (M.S. l69AAO, subd. 3) - A peace officer acting without a warrant
who has decided to proceed with the prosecution of a person for a driving while impaired
(DWI) offense shall arrest and take the person into custody, and the person must be
detained until the person's first court appearance.
Sex offender notification (M.S. 244.052, Subd. 4) - The law requires local law enforcement
agencies to disclose information regarding sex offenders to the public.
Sex offender registration (M.S. 243.166) - The law requires sex offenders to register their
residences with local law enforcement agencies.
9-1-1 requirements - Cities that operate PSAPs face the potential loss of guaranteed and stable
state revenues due to the actions of the 2005 state Legislature that discontinue assurance
that the dedication of the existing surcharge on monthly phone bills will be available after
2007 to cover local costs of providing for91l service. Current surcharge revenues of 20
cents/month paid to city-operated PSAPs cover only a small share of local 911 costs. As
a result, cities must increasingly rely on local property tax revenues to cover a large share
of the cost of maintenance as well as the technical and operational improvements and
system upgrades required to receive and identify the call-bac1<: number and location of
persons calling for help.
800 mhz requirements - Despite increased reliance on 911 surcharge revenues to finance the cost
of state bonds to be sold to continue the build-out of ARMER, the statewide public safety
radio communications backbone, only a small portion of that financing is available to aid
cities to build subsystems for local public safety communications that will provide
interoperable communications with other jurisdictions. To date, the Legislature has not
addressed how cities and counties will be able to afford to obtain the means necessary
(communications infrastructure improvements and portable and mobile radio equipment)
to obtain such coverage.
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BUILDING CODES
Minor residential improvements (M.S.l6B.63) - Limits permit fees to $15 or five percent,
whichever is greater, for improvement, installation or replacement of a residential fixture
or appliance that does not modify electric or gas service, has a labor cost of$500or less,
and is done by the homeowner or a licensed contractor.
Building code administration (M.S.16B.65) - Municipalities are given specific direction on how
to designate a certified building official who is responsible for code administration in the
city.
DATA PRACTICES
Job reference liability - Regulates city disclosure of employment information regarding current
and former employees, requiring that disclosure procedures and policies be implemented
to.assure that information provided is complete and accurate; that disclosure of
information regarding acts of violence, etc. are to be provided only in writing; that the
city obtain authorization from current or former employees to the release of such
information prior to disclosing public personnel data, evaluations conducted prior to
separation and employee responses, employee's personnel record and reasons (in writing)
for employment separation; and provide current and former employees by mail a copy of
employment information disclosed and to whom it was disclosed. (Chapter 137,2004
Session Laws)
Compliance with new data practice government data classifications - Compliance with new data
practice government data classifications such as payroll time sheets or other data that
would reveal city of residence of current and former employees, volunteers and
independent contractors; data regarding employees of secure treatment facilities and their
immediate family members that would reveal where they have received training or
attended educational courses if such data would reveal work assignments, home address
or phone number, location during non-work hours, or location of immediate family
members; nonpublic classification status for preliminary and final market value
appraisals of property owned by the city until a purchase agreement has been finalized or
appraisals are exchanged; release to <;lomestic abuse victim and victim's attorney of
written police report and arrest data related to domestic abuse prosecution;
implementation of procedures for closing, tape recording and maintaining recordings of
meetings to receive security briefings. (Chapter 290,2004 Session Laws)
ELECTIONS
Compliance with federal Help America Vote Act (RA V A) - Cities are required to comply with
RA VA voter registration absentee voting, military and overseas voter record reporting
procedures as well as with assisted voting equipment requirements. Cities that administer
absentee voting are to be open extended hours the day before election. (Chapter 293,
2004 Session Laws)
Conducting elections (M.S.20S) - State requirements determine when and how cities conduct
elections. These laws apply to: regular and special elections; elections for county, state,
federal, city and some school races; the timing of the election; publication and posting of
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the election; the hours that polls must remain open; the number and salaries of election
judges; state-certified voting equipment; time lines for testing of voting equipment;
preparation of ballots; absentee ballot procedures; and same-day voter registration.
Election iudges (M.S. 204B.22) - Head election judge must be present in the polling place all
day. Other judges may serve shifts. Head election judges must also obtain additional
training (extra 2 hours-- for which the head judge must be paid, plus any additional
transportation costs for attending the training).
Absentee ballots for overseas voters (M.S. 203B.16-l7) - Overseas voters (military or civilian)
may submit absentee ballot applications by fax or email (if Secretary of State determines
that security concerns have been adequately addressed) as well as in writing - meaning
the local election administrator must set up a process for receiving and processing fax and
email absentee applications and mailing out ballots, return envelopes, etc. to additional
voters living outside the U.S.
Absentee ballots for subsequent elections (M.S. 203B.16-17) - Since 2001, local election
administrators must automatically arrange to mail out absentee ballots for any general or
special election for the remainder of the calendar year to overseas voters who previously
in 200 I applied for an absentee ballot for the primary that year.
Recounts (M.S. 204C.35) - Changes to when automatic recounts must be recounted for federal,
state and judicial elections means that beginning in 2001, if, in a primary, the difference
in votes castis less than one-half of one percent of the total number of votes counted for
that nomination - or if the difference is 10 votes or less and the total of votes cast is 400
or less, the canvassing board (city council in most cases) must conduct a recount if the
difference would determine the outcome. In a general election, if the difference is less
than. one-half of one percent or ten votes or less and the total number of votes cast is 400
or less, the canvassing board must also conduct a recount.
ENVIRONMENT
Wastewater treatment standards - State requirements exceed those set by the federal government
for many standards affecting wastewater treatment. Extensive and complicated reporting
requirements are mandated by the pollution control agency (peA).
Wetlands - The Wetland Conservation Act must be administered by a city, county, or other local
government unit.
Solid waste management - State law specifies the existence and parameters oflocal recycling
programs, waste collection practices, etc.
Drinking water standards - State and federal regulation of drinking water requires frequent
testing and reporting to assure adherence to standards.
Surface water management organizations or plan (M.S. 1 03) - Cities are required to participate in
the development and costs of a comprehensive water management plan.
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Waste disposal facilities (PCA Rules) - State and federal regulation mandates most aspects of
waste to energy facilities and sanitary landfills.
Hazardous substance transportation (M.S.22l and federal SARA) - State and federal regulations
govern the transportation of hazardous substances. Cities are required to select routes for
transport, and police those routes, even though they are frequently not city streets.
Minnesota Clean Indoor Air Act (M.S.144.411-17) - Cities are required to comply with and
enforce the act within their public buildings.
NPDES Phase II permitting - (Federal Clean Water Act -- MN Rules 7050)
Surface waters - (M.S.103D) - Watershed districts have been authorized by the state to draft and
make rules regulating surface waters. This puts an unfunded mandate on cities with no
legislative review or oversight.
PLANNING
Land use planning (M.S.473H) - Cities in the seven-county metro area are required by the
stateand the Met Council to have a comprehensive land use plan.
State zoning standards (M.S. 463.365) - Local zoning decisions for manufactured homes, group
homes, earth-sheltered homes, etc., are limited by the state.
Uniform building code (UBe) (M.S. 13) - Cities are required to adopt and enforce a state uniform
building code which regulates heating, ventilation, energy conservation, electric, fire
standards, and plumbing. Handicap accessibility is one of the requirements which must
be assured for public buildings. Cities no longer receive excess building code fees to
help train local officials.
Flood plain management (M.S. 104.04) - The commissioner of natural resources is authorized to
require and approve local government reporting on flood plain management ordinances.
Costs associated with imposing local ordinances are usually borne by the local
government.
Flood insurance (M.S. 104.08) - The state requires that all local governments subject to recurrent
flooding participate in the national flood insurance program.
Shoreland regulations (M.S.105.485) - The commissioner of natural resources is authorized to
require and approve local government reporting on shore land management ordinances,
and monitor ongoing land use in the vicinity of the shoreland.
TRANSPORTATION
Municipal state aid roads (M.S.162.09 and MnDOT rules) - Cities must comply with standards in
order to receive reimbursement for funding for construction and maintenance of certain
roads. These standards often result in "overbuilding" city streets. Many items, such as
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full signals, landscaping, pre-engineering, and certain legal costs are not eligible for
compensation.
Computer requirements (Department of Transportation) - The MnDOT Municipal StateAid for
System (MSAS) Manual requires that cities receiving municipal state aid must use
MnDOT specified network computer hardware and software (MnDOT Municipal State
Aid Highway User Manual - City Level, p. 8).
Seasonal weight restrictions (M.S. 169) - State law provides exemptions to seasonal gross
weight limits for specific vehicles, including vehicles transporting milk, recycling and
garbage, forest products, certain agricultural products and utility vehicles. These
exemptions sometimes result in wear and damage that shortens the life span of local
roads and bridges.
Biodiesel fuel mandate (M.S. 239.77) - Requires that fuel sold in the state after June 30, 2005,
for use in internal combustion engines, contain a minimum of two percent ofbiodiesel
fuel by volume. This requirement could increase fuel costs and/ormaintenance costs for
affected vehicles.
GENERAL GOVERNMENT/RECORD KEEPING
Bleacher safety (M. S.16B.616) - Establishes safety requirements that apply to all bleachers over
30 inches above grade or the floor below. By January I, 2001, municipalities will be
required to provide the commissioner of administration with a signed certification of
compliance prepared by a qualified and certified building official or state licensed design
professional that certifies the bleachers have been inspected, are in compliance with the
safety requirements, and are structurally sound.
Minncor (M.S.16BI81) - A 19981aw change will require the state and all political subdivisions
to purchase only from MINNCOR when purchasing the products MINNCOR produces.
This requirement is effective the year 2000 if the state and political subdivisions fail to
meet a purchasing quota - the quota has not yet been established.
Non-visual technology (M.S. l6C.145) - A 1998 law mandates the state and all political
subdivisions to require all technology hardware and software purchases and upgrades to
satisfy non-visual technology standards that exceed the America Disability Act (ADA)
requirements. This mandate requires the purchase of technology that is either not yet
available or is cost prohibitive.
Street lighting (M.S.216C.19) - State law requires all new and replacement lighting for street and
parking lot lighting to meet energy efficiency standards adopted by the Department of
Transportation. Lamps with initial efficiencies of at least 70 lumens per watts, such as
high-pressure sodium or metal halide lamps, are required; mercury vapor lamps may not
be used.
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State record retention schedule Department of Administration (M.S 13) - State regulations
determine what records cities must keep and for what length of time. Requirements
include storage time ranging from three years to infinity.
Minnesota Government Data Practices Act (M.S.13) - Nearly all government data is to be
considered to be "public" under the Minnesota Government Data Practices statutes and
public access to, and reproduction of this information is required. The costs and fees
charged by local units of government for this data are minimal and limited.
Open meeting law (M.S.471.705) - Cities are generally required to open all of their meetings to
the public. State law includes specific requirements for meeting notices, agendas, and
minutes. Unlike violations of the law by the Legislature, city officials may be sued for
alleged violations.
Competitive bidding (M.S.471.345 and M.S.429.04l) - The uniform municipal contracting law
contains extensive regulation of the requirements for the advertising of and bidding on
municipal contracts.
Examination of bonded public employees (M.S.574.23) - An examination process is required
whenever there is a change in the personnel for city clerks and treasurers.
Summary budget statement publication (M.S.471.6965) - Annual publication of the city's
summary budget must include information relating to anticipated revenues and
expenditures in a design so that a comparison may be made between the current and
budget years. This must be published in the official newspaper of the city.
Home rule city charters (M.S.4l0) - State regulations are provided for the framing, adoption, and
amendments to the charter, and the operation of the charter commission.
Municipal liquor store reporting requirements (M.S.471.6985) - State reporting requirements for
financial statements from municipal liquor stores, hearings mandated if store shows loss
in any two of three consecutive years.
Annual tax increment district reporting: requirements (M.S. 469.175) - Comprehensive and
detailed annual reports of each TIF district are required and they must be provided by
cities to County Board(s), County Auditor(s), School Board(s), and the State Auditor,
Business subsidy reporting (M.S. 1161.993-995) - Local governments providing business
subsidies or financial assistance are required to submit information to the DEED for two
years after the benefit date, or until the goals are met, whichever is later.
Securing vacant buildings (M.S. 463-231) - Notice must be sent to the owner or owner'g agent,
the property taxpayer of record, holders of mortgage or sheriffs' certificates, and the
neighborhood association in the metro area.
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Development fee report (M.S. 462.) - Requires fees imposed under M.S. 462 must be fair,
reasonable and proportionate to the actual cost of the service for which the fee is
imposed. This requirement has added a level of complexity to the calculation of local
development fees. The law also requires cities to establish procedures to account for the
use of the fee
TAXES
Property tax personnel training (M.S. 273.0755) - Requires that every person licensed by the
state board of assessors at the Accredited MN Assessor level or higher shall successfully
complete a week-long MN laws course sponsored by the Department of Revenue at least
once every four years.
Training for local boards of review (M.S. 274.014) - Requires that at least one member of the
local boards of review must attend an appeals and equalization course developed or
approved by the commissioner of revenue starting January 1,2006.
Valuation and classification notice (M.S. 273.062) - Requires notices for all properties on the
tax rolls, not just for those that were reassessed or reclassified that year, requiring the
notices to show the market value and classification of the property for both the current
and previous year's assessment and authorizing the commissioner to specify the form of
the notice for all counties.
Department's cost of collecting local sales taxes (M.S. 297 A.99. subd.ll) - Requires the
Commissioner of Revenue deduct from the payments of local sales tax collections to
local jurisdictions, the cost of constructing and maintaining a zip code or geo-code data
base as required by the streamlined sales and use tax agreement for administration of
local sales taxes. This requirement only impacts those cities that currently impose a local
sales tax.
REVENUE CONSTRAINTS
Tax exempt property (M.S. 272.02) - Many properties in cities are defined by state statute as
exempt from property taxes imposed by the city. The use and nature of these properties
frequently increase city costs (police and fire protection, road maintenance, street ~.
lighting, etc.). Examples include: state institutions, such as universities, hospitals,
corrections facilities, and other state-owned properties.
Limitations on local special assessments (M.S.429) - Statutory restrictions are imposed on the
uses, notices, hearings, bidding, contracts, apportionment of cost, assessment procedures,
and collection of special assessments.
Local improvement requirements (M.S. 429.031) - Feasibility reports must contain information
showing the need and cost effectiveness of the project.
Limitations on maximum penalties and fine (M.S.609.033-0391 - Statutory restrictions are
placed on allowable penalties and fines for ordinance violations, and petty and gross
misdemeanors.
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Truth-in-taxation (M.S.275.065) - State law requires cities to provide pre-notification of property
tax changes, newspaper advertisements, multiple special hearings, and compliance with
state rules. Cities must certify a proposed levy amount by September 15 and, with few
exceptions, are not allowed to increase this amount. Cities must also pay a proportional
share of the counties' costs of preparing and mailing parcel specific notices.
MISCELLANEOUS
State sales and MVET on city purchases (M.S. 297 A and 297B) - Cities are required to raise,
through property taxes or fees; adequate revenue to pay the 6.5 percent sales tax on most
city purchases of goods and services. In addition, they must pay the motor vehicle excise
tax (MVET) on vehicles such as road maintenance vehicles, plows, dump trucks, etc.
Grandfathered contributions to regional libraries (M.S. 134.34) - The state requires that once a
city participates in funding a regional library, the minimum contribution made may not be
reduced. This is known as maintenance of effort funding.
Ordinance copies to law libraries (M.S. 415.021) - Cities are required to furnish copies of any
ordinances they adopt to.the local county law libraries and do not receive reimbursement
for reasonable copying charges unless they make a request to the library.
Development and permit fees report (M.S. l6B.685) - Cities are required to report in detail all
fees collected related to building and development in their communities. In addition, the
report requires a comprehensive identification of all costs and expenses related to
providing services related to those activities.
TIF grant fund cancellation - Cancels the appropriations to the TIF grant fund ($91 million in FY
2002 and $38 million in FY 2003 and thereafter) and repeals the entire grant program
enacted in 2001 for grants payable in 2003 and thereafter. At least part of the rationale for
the TIF grant fund was that the impacts on existing districts resulted from the state's
changes to the property tax system. Where a city has outstanding bonds or other
obligations, it will now have to look for internal solutions to address the impacts from
prior state actions. (Laws 2002, chapter 220, article 13, section 8)
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