1.1                          A bill for an act 
  1.2             relating to state finance; setting the amount of the 
  1.3             budget reserve; reducing the property tax recognition 
  1.4             shift; providing for adjustments to appropriations 
  1.5             following forecasts of general fund revenues and 
  1.6             expenditures; appropriating money; amending Minnesota 
  1.7             Statutes 1995 Supplement, sections 16A.152, 
  1.8             subdivision 2; and 121.904, subdivision 4a; repealing 
  1.9             1996 House File No. 2156, article 14, section 4. 
  1.10  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.11     Section 1.  Minnesota Statutes 1995 Supplement, section 
  1.12  16A.152, subdivision 2, is amended to read: 
  1.13     Subd. 2.  [ADDITIONAL REVENUES; PRIORITY.] If on the basis 
  1.14  of a forecast of general fund revenues and expenditures the 
  1.15  commissioner of finance determines that there will be a positive 
  1.16  unrestricted budgetary general fund balance at the close of the 
  1.17  biennium, the commissioner of finance must allocate money to the 
  1.18  budget reserve until the total amount in the account is 
  1.19  $220,000,000 $270,000,000.  An amount equal to any additional 
  1.20  biennial unrestricted budgetary general fund balances balance 
  1.21  made available after November 1 of every as the result of a 
  1.22  forecast in an odd-numbered calendar year are after November 1 
  1.23  is appropriated in January of the following year to reduce the 
  1.24  property tax levy recognition percent under section 121.904, 
  1.25  subdivision 4a, to zero before additional money 
  1.26  beyond $220,000,000 $270,000,000 is allocated to the budget 
  1.27  reserve account.  The amount appropriated is the full amount 
  2.1   forecast to be available at the end of the biennium and is not 
  2.2   limited to the amount forecast to be available at the end of the 
  2.3   current fiscal year. 
  2.4      The amounts necessary to meet the requirements of this 
  2.5   section are appropriated from the general fund. 
  2.6      Sec. 2.  Minnesota Statutes 1995 Supplement, section 
  2.7   121.904, subdivision 4a, is amended to read: 
  2.8      Subd. 4a.  [LEVY RECOGNITION.] (a) "School district tax 
  2.9   settlement revenue" means the current, delinquent, and 
  2.10  manufactured home property tax receipts collected by the county 
  2.11  and distributed to the school district, including distributions 
  2.12  made pursuant to section 279.37, subdivision 7, and excluding 
  2.13  the amount levied pursuant to section 124.914, subdivision 1. 
  2.14     (b) In June of each year, the school district shall 
  2.15  recognize as revenue, in the fund for which the levy was made, 
  2.16  the lesser of:  
  2.17     (1) the May, June, and July school district tax settlement 
  2.18  revenue received in that calendar year; or 
  2.19     (2) the sum of the state aids and credits enumerated in 
  2.20  section 124.155, subdivision 2, which are for the fiscal year 
  2.21  payable in that fiscal year plus an amount equal to the levy 
  2.22  recognized as revenue in June of the prior year plus 48 31 
  2.23  percent for fiscal year 1996 and thereafter of the amount of the 
  2.24  levy certified in the prior calendar year according to section 
  2.25  124A.03, subdivision 2, plus or minus auditor's adjustments, not 
  2.26  including levy portions that are assumed by the state; or 
  2.27     (3) 48 18.1 percent for fiscal year 1996, the percent 
  2.28  determined under section 3 for fiscal year 1997 and that same 
  2.29  percent thereafter of the amount of the levy certified in the 
  2.30  prior calendar year, plus or minus auditor's adjustments, not 
  2.31  including levy portions that are assumed by the state, which 
  2.32  remains after subtracting, by fund, the amounts levied for the 
  2.33  following purposes:  
  2.34     (i) reducing or eliminating projected deficits in the 
  2.35  reserved fund balance accounts for unemployment insurance and 
  2.36  bus purchases; 
  3.1      (ii) statutory operating debt pursuant to section 124.914, 
  3.2   subdivision 1; 
  3.3      (iii) retirement and severance pay pursuant to sections 
  3.4   122.531, subdivision 9, 124.2725, subdivision 15, 124.4945, 
  3.5   124.912, subdivision 1, and 124.916, subdivision 3, and Laws 
  3.6   1975, chapter 261, section 4; 
  3.7      (iv) amounts levied for bonds issued and interest thereon, 
  3.8   amounts levied for debt service loans and capital loans, amounts 
  3.9   levied for down payments under section 124.82, subdivision 3, 
  3.10  and amounts levied pursuant to section 136C.411; and 
  3.11     (v) amounts levied under section 124.755.  
  3.12     Notwithstanding the foregoing, the levy recognition 
  3.13  percentage for the referendum levy certified according to 
  3.14  section 124A.03, subdivision 2, is 31 percent. 
  3.15     (c) In July of each year, the school district shall 
  3.16  recognize as revenue that portion of the school district tax 
  3.17  settlement revenue received in that calendar year and not 
  3.18  recognized as revenue for the previous fiscal year pursuant to 
  3.19  clause (b).  
  3.20     (d) All other school district tax settlement revenue shall 
  3.21  be recognized as revenue in the fiscal year of the settlement. 
  3.22  Portions of the school district levy assumed by the state, 
  3.23  including prior year adjustments and the amount to fund the 
  3.24  school portion of the reimbursement made pursuant to section 
  3.25  273.425, shall be recognized as revenue in the fiscal year 
  3.26  beginning in the calendar year for which the levy is payable. 
  3.27     Sec. 3.  [1997 PROPERTY TAX RECOGNITION SHIFT ADJUSTMENT.] 
  3.28     Subdivision 1.  [ADJUSTMENT.] The commissioner of finance 
  3.29  shall adjust the property tax recognition shift percentage for 
  3.30  fiscal year 1997 under Minnesota Statutes, section 121.904, 
  3.31  subdivision 4a, paragraph (b), clause (3), according to this 
  3.32  section. 
  3.33     Subd. 2.  [APPROPRIATION.] $180,000,000 is appropriated 
  3.34  from the general fund to the commissioner of children, families, 
  3.35  and learning for fiscal year 1997 to reduce the property tax 
  3.36  levy recognition percentage under Minnesota Statutes, section 
  4.1   121.904, subdivision 4a, paragraph (b), clause (3).  This 
  4.2   appropriation replaces the appropriation for fiscal year 1997 
  4.3   made under Minnesota Statutes, section 16A.152, subdivision 2, 
  4.4   as a result of the November 1995 forecast. 
  4.5      Subd. 3.  [NOVEMBER 1996 DEFICIT CONTINGENCY.] 
  4.6   Notwithstanding Minnesota Statutes, section 16A.152, subdivision 
  4.7   4, if the commissioner of finance determines on the basis of a 
  4.8   forecast of general fund revenues and expenditures issued before 
  4.9   January 1, 1997, that the unrestricted budgetary general fund 
  4.10  balance at the close of the 1996-1997 biennium will show a 
  4.11  deficit, the commissioner of finance shall first act to reduce 
  4.12  the deficit by increasing the property tax recognition 
  4.13  percentage under Minnesota Statutes, section 121.904, 
  4.14  subdivision 4a, paragraph (b), clause (3), but not above 18.1 
  4.15  percent.  The appropriation in subdivision 2 is reduced 
  4.16  accordingly.  The commissioner of finance shall make up any 
  4.17  additional deficit by reducing the amount in the budget reserve 
  4.18  in accordance with Minnesota Statutes, section 16A.152, 
  4.19  subdivision 4. 
  4.20     Subd. 4.  [NOVEMBER 1996 SURPLUS CONTINGENCY.] 
  4.21  Notwithstanding Minnesota Statutes, section 16A.152, subdivision 
  4.22  4, if the commissioner of finance determines on the basis of a 
  4.23  forecast of general fund revenues and expenditures issued before 
  4.24  January 1, 1997, that the unrestricted budgetary general fund 
  4.25  balance at the close of the 1996-1997 biennium will show a 
  4.26  surplus, the amount of the surplus is appropriated from the 
  4.27  general fund to an education aid reserve account, except that 
  4.28  the amount appropriated must not exceed the forecast value of 
  4.29  the cost of reducing the property tax levy recognition 
  4.30  percentage under Minnesota Statutes, section 121.904, 
  4.31  subdivision 4a, paragraph (b), clause (3), to zero in fiscal 
  4.32  year 1997.  The balance in the account does not cancel but may 
  4.33  not be expended until appropriated by law for education aid for 
  4.34  fiscal years 1998 and 1999. 
  4.35     Subd. 5.  [PERCENTAGE CERTIFICATION.] The commissioner of 
  4.36  finance shall determine the amount available to reduce the 
  5.1   property tax levy recognition percentage after giving effect to 
  5.2   subdivisions 2 and 3, and shall certify it to the commissioner 
  5.3   of children, families, and learning by January 5, 1997.  The 
  5.4   commissioner of children, families, and learning shall calculate 
  5.5   the percentage using the method specified in section 121.904, 
  5.6   subdivision 4c, and shall notify school districts of the 
  5.7   resulting change in the levy recognition percentage by January 
  5.8   15, 1997. 
  5.9      Sec. 4.  [BUDGET RESERVE 1996.] 
  5.10     The amount necessary to bring the budget reserve to 
  5.11  $270,000,000 on July 1, 1996, is appropriated from the general 
  5.12  fund to the commissioner of finance for transfer to the budget 
  5.13  reserve on that date. 
  5.14     Sec. 5.  [REPEALER.] 
  5.15     1996 H.F. No. 2156, article 14, section 4, if enacted, is 
  5.16  repealed. 
  5.17     Sec. 6.  [EFFECTIVE DATE.] 
  5.18     This act is effective the day following final enactment.