2005 Minnesota Statutes

     126C.68 Debt service loans. 

    Subdivision 1.    Qualification; application; award; 
 interest.  Any district in which the required levy for debt 
 service in any year will exceed its maximum effort debt service 
 levy by ten percent or by $5,000, whichever is less, is 
 qualified for a debt service loan hereunder in an amount not 
 exceeding the amount applied for, and not exceeding one percent 
 of the net debt of the district, and not exceeding the 
 difference between the required and the maximum effort debt 
 service levy in that year.  Applications must be filed with the 
 commissioner in each calendar year up to and including July 1.  
 The commissioner shall determine whether the applicant is 
 entitled to a loan and the amount thereof, and on or before 
 October 1 shall certify to each applicant district the amount 
 granted and its due date.  The commissioner shall notify the 
 county auditor of each county in which the district is located 
 that the amount certified is available and appropriated for 
 payment of principal and interest on its outstanding bonds.  The 
 auditors shall reduce by that amount the taxes otherwise 
 leviable as the district's debt service levy on the tax rolls 
 for that year.  Each debt service loan shall bear interest from 
 its date at a rate equal to the average annual rate payable on 
 Minnesota state school loan bonds most recently issued prior to 
 the disbursement of the loan to the district, but in no event 
 less than 3-1/2 percent per annum on the principal amount from 
 time to time remaining unpaid.  Interest is payable on December 
 15 of the year following that in which the loan is received and 
 annually thereafter. 

    Subd. 2.    Note.  Each debt service loan must be 
 evidenced by a note executed on behalf of the district by the 
 signatures of its chair or vice-chair and the school district 
 clerk.  The note must be dated November 1 of the year in which 
 executed, and must state its principal amount, interest rate, 
 and that it is payable at the commissioner's office.  The note 
 must have printed thereon, or the commissioner shall attach 
 thereto, a grill for entry of the date and amount of each 
 payment and allocations of each payment to accrued interest or 
 principal.  The note must also include a certificate to be 
 executed by the county auditor of each county in which any 
 portion of the district is situated, prior to the delivery of 
 the note, stating that the county auditor has entered the debt 
 service loan evidenced thereby in the auditor's bond register.  
 The notes must be delivered to the commissioner not later than 
 November 15 of the year in which executed.  The commissioner 
 shall cause a record to be made and preserved showing the 
 obligor district and the date and principal amount of each note. 

    Subd. 3.    Warrant.  The commissioner shall issue to 
 each district whose note has been so received a warrant on the 
 debt service loan account of the maximum effort school loan 
 fund, payable on presentation to the commissioner of finance out 
 of any money in such account.  The warrant shall be issued by 
 the commissioner in sufficient time to coincide with the next 
 date on which the district is obligated to make principal or 
 interest payments on its bonded debt in the ensuing year.  
 Interest must accrue from the date such warrant is issued.  The 
 proceeds thereof must be used by the district to pay principal 
 or interest on its bonded debt falling due in the ensuing year.  

    Subd. 4.    Levy.  Each district receiving a debt 
 service loan shall levy for debt service in that year and each 
 year thereafter, until all its debts to the fund are paid, (a) 
 the amount of its maximum effort debt service levy, or (b) the 
 amount of its required debt service levy less the amount of any 
 debt service loan in that year, whichever is greater.  The 
 district shall remit payments to the commissioner according to 
 section 126C.71.  By September 30, the commissioner shall notify 
 the county auditor of each county containing taxable property 
 situated within the school district of the amount of the maximum 
 effort debt service levy of the district for that year, and said 
 county auditor or auditors shall extend upon the tax rolls an ad 
 valorem tax upon all taxable property within the district in the 
 aggregate amount so certified.  

    HIST: Ex1959 c 27 s 7; 1961 c 752 s 3,4; 1965 c 875 s 4,5; 
 1969 c 1056 s 3,4; 1973 c 492 s 14; 1975 c 432 s 55-57; 1981 c 
 358 art 9 s 5,6; 1986 c 444; 1989 c 271 s 29; 1Sp1989 c 1 art 9 
 s 2,3; 1Sp1997 c 4 art 4 s 12; 1998 c 397 art 7 s 53,164; art 11 
 s 3; 2003 c 112 art 2 s 50