Report of the Legislative Committee to the Assembly

December 13, 2013

 

The Legislative Committee has met three times during this Bar Year, most recently to review legislative proposals from MSBA sections and develop recommendations for the Assembly and the Council.

 

The September meeting was devoted to new member orientation and discussion of a timeline for the legislative vetting process.

 

The October meeting’s discussion centered upon 2014 legislative priorities and potential proposals by the Minnesota Uniform Laws Commissioners.  Section/committee chairs and legislative liaisons were invited to this particular meeting, and many chose to attend.

 

On December 2, the Legislative Committee met to consider eighteen legislative proposals from MSBA sections.  After thorough review, the Committee advanced the following recommendations.

 

Action Items:

 

A.      Resolved that the Assembly adopt the recommendation set forth in the August 30, 2013 memo to the Council and direct MSBA staff take the steps required by law to dissolve LawPAC.  This position was approved by the LawPAC board of trustees as well as the MSBA Council in September 2013. 

 

B.      Resolved that the Assembly approve the following recommendations of the Legislative Committee:

 

1.       That the MSBA endorse the following proposals of the Business Law Section:

a.       Amendments to the Minnesota Business Corporations Act, §302A of the Minnesota Statutes, and related statutes, to reflect current best practices and developing norms of corporate governance.

b.      Support the adoption of a statute creating a new organizational form, the benefit corporation, which requires that the corporation and its directors consider the interests of constituencies other than shareholders.

2.       That the MSBA endorse the following joint proposal of the Business Law and Real Property Law Sections:

a.       Amendments to Minnesota Statutes §576, §577, and §559 to make technical corrections clarifying receiverships and assignments for the benefit of creditors.

 

3.       That the MSBA endorse the following proposals of the Family Law Section:

a.       Amendments to Minnesota Statutes §518.552 and §519A.29 directing that spousal maintenance is calculated after child support.

b.      Amend Minnesota Statute §518A to provide that child support calculations consider the self-support reserve for both the obligor and obligee in child support determinations.

4.       That the MSBA endorse the following proposals of the Real Property Law Section:

a.       Amend Minnesota Statute §580.26 to correct an ambiguity regarding a recording of a certificate of redemption so that the statute works in concert with redemption periods that vary in length.

b.      Amend Minnesota Statute §507.403 to alleviate liability for a party who records a certificate of partial release that was wrongfully executed, even if that party is without knowledge of the wrongful execution.

c.       Amend Minnesota Statute §507.071 to clarify the meaning of various clauses regarding transfer on death deeds (TODDs).

5.       That the MSBA endorse the following joint proposal of the Tax Law Section and Minnesota CLE:

a.       Amend Minnesota Statute §297A to clarify that it was not the intent of the legislature for the sales tax on digital goods to include live webinars in the definition of “digital audiovisual works.”

 

Report Items:

 

C.      Other reports of the Legislative Committee not requiring Assembly action:

 

1.       The Legislative Committee agreed to refer the proposal of the Construction Law Section regarding access to the sales tax exemption for construction materials used by governments and nonprofits back to the section for further study and consultation.  This proposal was first approved by the Assembly as an MSBA legislative position in 2007 and was presented to the Legislative Committee for renewal as it sunsets at the end of 2013.  The Legislative Committee was concerned that the proposal was not appropriate as an association-wide position but encourages the Construction Law Section to work with other stakeholder groups who would directly benefit from this change to the procurement process, including taking the following specific actions:

a.       Consult and partner with stakeholder groups with a direct interest/ benefit gain from the tax exemption, including but not limited to the League of Minnesota Cities, the Minnesota Association of Counties, and the Minnesota Council of Nonprofits.

b.      Consult and partner with stakeholder groups who directly use the current procurement system, including but not limited to the Association of General Contractors and the Minnesota Subcontractors Association.

c.       Continue working with the Minnesota Department of Revenue, and if applicable, the Minnesota Department of Employment and Economic Development to establish consensus on policy and fiscal implications.

d.      Consider pursuing a section-only position if relevant legislation is introduced at during the 2014 legislative session.

2.       The Legislative Committee agreed to refer the proposal of the Military & Veterans Affairs Section regarding the Uniform Deployed Parents Custody and Visitation Act (UDPCVA) back to the section for further study and consultation.  This is the first year that the UDPCVA has come before the Legislative Committee and consensus among sections is not yet in place.  The Committee recommends the following specific actions:

a.       Resolution of the Family Law Section’s concerns with the UDPCVA regarding the proposal.

b.      Continue working with all concerned MSBA sections to seek consensus on bill language, including but not limited to the Family Law Section and the Children and the Law Section. 

c.       Continue working with outside stakeholders, including the Uniform Laws Commissioners, the Minnesota chapter of American Academy of Matrimonial Lawyers, and other members of the family law practice area.

d.      Consider pursuing a section-only position either alone or as a joint proposal with other interested sections if consensus within the MSBA is reached.

3.       The Legislative Committee agreed to refer the proposal of the Probate & Trust Law Section regarding a revision to the Uniform Trust Code back to the section for further study and consultation.  Although a committee within the Section has been working on the expansive rewrite of the Trust Code over three years, the Legislative Committee concluded that vetting both within and outside of the MSBA was not yet complete.  The Committee recommends the Section complete the following actions before resubmitting the proposal for MSBA approval:

a.       Resolve the concerns articulated by the Real Property Law Section and the Nonprofit Corporations Committee of the Business Law Section, as well as any concerns that arise from other MSBA sections.

b.      Consult with outside stakeholder groups, including but not limited to the Minnesota Bankers Association, title companies, and financial institutions.

c.       Confirm support of the Uniform Law Commissioners and attempt to secure lobbying resources from them to assist in passing the bill through the legislature. 

4.       The Legislative Committee agreed to refer the proposal of the Real Property Law Section regarding amending the Safe at Home legislation back to the section for further study and consultation.  The concerns of the Committee coalesced around the retroactivity of the proposed effective date change and the lack of a concrete policy solution to the title problems that currently exist.  The committee suggests the following specific actions before resubmitting the proposal for MSBA approval:

a.       Resolve concerns articulated with the Family Law Section and any other relevant MSBA section or committee.

b.      Consult with outside stakeholders including, but not limited to, the Secretary of State’s office, the Minnesota Association of County Officers, the Minnesota County Recorders Association, and the Minnesota Land Title Association to find a policy solution to the issue of clearing title with redacted records.

c.       With assistance from MSBA lobbyists, consult with 2013 Safe at Home bill authors to propose a policy change to the bill that resolves the title problems while still protecting the identity of individuals enrolled in the Safe at Home program. 

5.       The Legislative Committee agreed to refer the proposal of the Real Property Law Section regarding references to “husband” and “wife” in real estate statutes back to the section for further consultation.  The Committee suggests the following specific actions:

a.       Work with the Revisor of Statutes to ensure that changes will be included along with other gendered language now obsolete due to the passage of the same sex marriage bill  in the 2014 “statute cleanup bill.”

b.      If the Revisor will not include the suggested language changes, the section may wish to pursue a section-only position or work with other MSBA sections to clean up all gendered language in Minnesota statutes that is now obsolete. 

6.       The Legislative Committee agreed to refer the proposal of the Tax Law Section regarding the statute of limitations for claiming a refund for overpaid taxes back to the section for further study and consultation. Given that the particular statute of limitations under discussion was once in conformity with the federal statute, the Committee concluded that more research was needed before making a determination on the soundness of the current proposal.  Suggested actions include:

a.       Research and report on the legislative history regarding the current statute of limitations, including but not limited to the policy considerations that led Minnesota out of conformity with federal statutes. 

b.      Consult with legislative staff (with assistance from MSBA lobbyists, if necessary) to determine the legislative intent of the current state statute of limitations. 

7.       The Legislative Committee agreed to refer the proposal of the Tax Law Section regarding interest for refunds obtained back to the section for further study and consultation, including the following specific actions:

a.       Consult and partner with stakeholder groups with direct financial interests in opposing the reduction of judgment interest, such as taxpayer advocacy groups.

b.      Consider pursuing a section-only position if relevant legislation is introduced at during the 2014 legislative session.

8.       The Legislative Committee agreed to refer the proposal of the Tax Law Section regarding refunds due to misclassification of property back to the section for further study and consultation, including the following specific actions:

a.       Consult and partner with stakeholder groups with direct financial interests in refunds due to a misclassification of property, such as taxpayer advocacy groups.

b.      Consider pursuing a section-only position if relevant legislation is introduced at during the 2014 legislative session.

9.       The Legislative Committee agreed to refer the proposal of the Tax Law Section regarding single petitions for properties under common ownership back to the section for further study and consultation, including the following specific actions:

a.       Consult and partner with stakeholder groups with  direct financial interests in opposing the restriction of single petitions to challenge assessments of property under common ownership, including but not limited to condominium associations, developer associations, and taxpayer advocacy groups.

b.      Consider pursuing a section-only position if relevant legislation is introduced at during the 2014 legislative session.

10.   The Legislative Committee agreed to recommend to the MSBA Council that when the Council sets 2013 lobbying priorities for section issues, the priorities (in no particular order) should be:

a.       Pending approval by the Assembly, amend the Minnesota Business Corporations Act, §302A of the Minnesota Statutes, and related statutes, to reflect current best practices and developing norms of corporate governance.  This proposal from the Business Law Section was presented to the Legislative Committee on December 2.

b.      Pending approval by the Assembly, amend Minnesota Statute §580.26, §507.403, and §507.071 to make technical changes regarding a certificate of redemption, the recording of a wrongfully executed certificate of partial release, and transfer on death deeds (TODDs).  These constitute three Real Property Section proposals that were presented to the Legislative Committee on December 2.

c.       Pending approval by the Assembly, amend Minnesota Statute §297A to clarify the legislature’s intended meaning of digital goods which should be subject to sales tax.  This joint proposal from the Tax Law Section and Minnesota CLE was presented to the Legislative Committee on December 2.