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extent that it would offset the negative <br />effects of the utility valuation rule change. <br />FF-23. State Assistance for <br />Property Tax Refunds for State - <br />Assessed Property <br />Issue: State law requires certain property, <br />including pipelines, railroad, utility property <br />be assessed for property taxation purposes <br />by the Minnesota Department of Revenue. <br />When companies challenge the valuation of <br />these properties, local units of government <br />may be required to refund excess taxes, <br />which in some cases, can create financial <br />hardship for local units of government and <br />their taxpayers. <br />Response: The state should establish a <br />program to provide financial <br />compensation to all units of local <br />government for court ordered property <br />tax refunds where the state has <br />determined values. <br />FF-24. Transition for Property <br />Acquired by Tax -Exempt Entities <br />Issue: When an existing taxable property is <br />acquired by a tax-exempt entity other than a <br />city or a city development authority or <br />otherwise becomes tax exempt and removed <br />from the tax base, the taxes formerly paid by <br />the property owner are shifted to other, <br />remaining taxable properties within the <br />jurisdiction. When the acquired property is a <br />large percentage of the tax base of a city or <br />other local unit of government, the shift in <br />taxes can be substantial. <br />Response: To avoid immediate, large tax <br />burden shifts when an existing taxable <br />property is acquired by an entity <br />qualifying for a Minnesota property tax <br />exemption other than a city or a city <br />development authority or overwise <br />144 <br />becomes tax exempt, state law should <br />require the new owner to continue to pay <br />the property taxes with a five-year phase- <br />out of taxable value or the state <br />legislature should create a program that <br />provides a state -paid transition aid paid <br />over a period of time to local units of <br />government that experience tax exempt <br />acquisitions, paid over a period of time. <br />FF-25. Payments for Services to <br />Tax -Exempt Property <br />Issue: Taxable property in many cities is <br />being acquired by nonprofit and government <br />entities. Converting the property to tax- <br />exempt status can lead to serious tax base <br />erosion without any corresponding reduction <br />in the service needs created by the property. <br />In 2013, legislation was introduced that <br />would have broadly exempted non-profit <br />property from paying user fees or service <br />charges for any service funded in part with <br />property taxes over the previous five years. <br />Under certain circumstances, this proposal <br />could have potentially exempted non -profits <br />from paying for even utility charges. <br />Response: Cities should have the <br />authority to collect payments from <br />statutorily -exempt property owners to <br />cover costs of service similar to the <br />authority provided under the special <br />assessment law. The League of Minnesota <br />Cities opposes legislation that would <br />exempt non -profits from paying for user <br />fees and service charges that help fund <br />services these organizations use. <br />FF-26. Public Safety Protection <br />Districts <br />Issue: Public Safety protection districts have <br />the potential to reduce duplication of <br />equipment purchases and services, and to <br />improve uniformity of service delivery <br />