1.1                          A bill for an act 
  1.2             relating to education; enhancing Minnesota's 
  1.3             elementary and secondary school system by providing 
  1.4             all school district operating funds through state 
  1.5             aids; amending Minnesota Statutes 1998, sections 
  1.6             122A.62, subdivision 3; 123A.39, subdivision 3; 
  1.7             123A.41, subdivision 4; 123A.444; 123A.485, 
  1.8             subdivisions 1 and 3; 123A.67, subdivision 3; 123A.73, 
  1.9             subdivisions 9 and 12; 123A.76; 123B.53, subdivisions 
  1.10            4 and 5; 123B.54; 123B.57, subdivisions 1, 3, and 5; 
  1.11            123B.59, subdivisions 1, 2, 4, 6, and 7; 123B.61; 
  1.12            123B.62; 123B.64, subdivision 2; 124D.135, 
  1.13            subdivisions 1 and 6; 124D.20, subdivision 1; 124D.22, 
  1.14            subdivision 2; 124D.56, subdivision 1; 124D.86, 
  1.15            subdivision 5; 126C.13, subdivisions 1, 2, 3, and 4; 
  1.16            126C.14; 126C.40, subdivision 4; 126C.41, subdivisions 
  1.17            1, 3, and 4; 126C.42, subdivisions 1, 2, 3, and 4; 
  1.18            126C.43, subdivisions 1, 2, 3, 4, 5, and 6; 126C.44; 
  1.19            and 126C.45; proposing coding for new law in Minnesota 
  1.20            Statutes, chapter 127A; repealing Minnesota Statutes 
  1.21            1998, sections 123B.57, subdivisions 6 and 7; 123B.59, 
  1.22            subdivision 5; 123B.64, subdivisions 3 and 4; 
  1.23            124D.135, subdivisions 3 and 4; 124D.20, subdivisions 
  1.24            5, 6, and 7; 124D.56, subdivisions 2 and 3; 124D.86, 
  1.25            subdivision 4; 126C.10, subdivisions 10, 11, 21, and 
  1.26            22; and 126C.17, subdivisions 1, 2, 3, 4, 5, 6, 7, 8, 
  1.27            9, 10, 11, and 12. 
  1.28  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.29     Section 1.  Minnesota Statutes 1998, section 122A.62, 
  1.30  subdivision 3, is amended to read: 
  1.31     Subd. 3.  [STAFF DEVELOPMENT LEVY INCENTIVE AID.] A 
  1.32  district's levy staff development incentive aid equals the 
  1.33  number of teachers at the site times $8.15. 
  1.34     Sec. 2.  Minnesota Statutes 1998, section 123A.39, 
  1.35  subdivision 3, is amended to read: 
  1.36     Subd. 3.  [RETIREMENT AND SEVERANCE LEVY AID.] A 
  2.1   cooperating or combined district that levied under Minnesota 
  2.2   Statutes 1996, section 124.2725, subdivision 3, for taxes 
  2.3   payable in 1995 may levy is eligible for state aid for severance 
  2.4   pay or early retirement incentives for licensed and nonlicensed 
  2.5   employees who retire early as a result of the cooperation or 
  2.6   combination. 
  2.7      Sec. 3.  Minnesota Statutes 1998, section 123A.41, 
  2.8   subdivision 4, is amended to read: 
  2.9      Subd. 4.  [TRANSITIONAL LEVY AID.] The board of the 
  2.10  combined district, or the boards of combining districts that 
  2.11  have received voter approval for the combination under section 
  2.12  123A.37, subdivision 2, may levy for are eligible for state aid 
  2.13  equal to the expenses of negotiation, administrative expenses 
  2.14  directly related to the transition from cooperation to 
  2.15  combination, and the cost of necessary new athletic and music 
  2.16  uniforms.  The board or boards may levy this amount over three 
  2.17  or fewer years.  All expenses must be approved by the 
  2.18  commissioner of children, families, and learning.  
  2.19     Sec. 4.  Minnesota Statutes 1998, section 123A.444, is 
  2.20  amended to read: 
  2.21     123A.444 [LEVY STATE AID FOR SEVERANCE PAY.] 
  2.22     A joint powers board established under section 123A.443 may 
  2.23  make a levy is eligible for state aid to provide severance pay 
  2.24  and early retirement incentives under section 122A.48, for any 
  2.25  teacher as defined under section 122A.40, subdivision 1, who is 
  2.26  placed on unrequested leave as a result of the cooperative 
  2.27  secondary facility agreement.  A joint powers board making a 
  2.28  levy must certify to each participating district tax levies 
  2.29  sufficient to raise the amount necessary to provide the 
  2.30  district's portion of severance pay and early retirement 
  2.31  incentives.  The tax levy certified to each district must be 
  2.32  expressed as a local tax rate, that, when applied to the 
  2.33  adjusted net tax capacity of all of the participating districts 
  2.34  raises the amount necessary to provide severance pay and early 
  2.35  retirement incentives.  Each participating school district must 
  2.36  include the levy in the next tax roll which it shall certify to 
  3.1   the county auditor, and must remit the collections of the levy 
  3.2   to the joint powers board. 
  3.3      Sec. 5.  Minnesota Statutes 1998, section 123A.485, 
  3.4   subdivision 1, is amended to read: 
  3.5      Subdivision 1.  [ELIGIBILITY AND USE.] A district that has 
  3.6   been reorganized after June 30, 1994, under section 123A.48 is 
  3.7   eligible for consolidation transition revenue.  Revenue is equal 
  3.8   to the sum of aid under subdivision 2 and levy under subdivision 
  3.9   3 aid.  Consolidation transition revenue aid may only be used 
  3.10  according to this section.  Revenue Aid must be used for the 
  3.11  following purposes and may be distributed among these purposes 
  3.12  at the discretion of the district: 
  3.13     (1) to offer early retirement incentives as provided by 
  3.14  section 123A.48, subdivision 23; 
  3.15     (2) to reduce operating debt as defined in section 123B.82; 
  3.16     (3) to enhance learning opportunities for students in the 
  3.17  reorganized district; and 
  3.18     (4) for other costs incurred in the reorganization. 
  3.19     Revenue Aid received and utilized under clause (3) or (4) 
  3.20  may be expended for operating purposes, facilities, and/or 
  3.21  equipment.  Revenue received under this section must not be 
  3.22  included in the determination of the reduction under section 
  3.23  124A.26, subdivision 1.  
  3.24     Sec. 6.  Minnesota Statutes 1998, section 123A.485, 
  3.25  subdivision 3, is amended to read: 
  3.26     Subd. 3.  [LEVY ADDITIONAL AID.] If the aid available in 
  3.27  subdivision 2 is insufficient to cover the costs of the district 
  3.28  under section 123A.48, subdivision 23, the district may levy the 
  3.29  difference over a period of time not to exceed three years apply 
  3.30  to the commissioner of children, families, and learning for 
  3.31  state aid in an amount not to exceed the unreimbursed costs 
  3.32  incurred by the district.  
  3.33     Sec. 7.  Minnesota Statutes 1998, section 123A.67, 
  3.34  subdivision 3, is amended to read: 
  3.35     Subd. 3.  [REIMBURSEMENT; SPECIAL LEVY STATE AID.] (a) 
  3.36  Liabilities of a dissolved district existing at the time of the 
  4.1   attachment other than bonded debt within the purview of 
  4.2   subdivision 2 must be obligations of the consolidated district 
  4.3   after attachment (in the amount and kind determined by the 
  4.4   commissioner according to subdivision 1, where a dissolved 
  4.5   district is divided), for the payment of which the consolidated 
  4.6   district has a right to reimbursement by special levy or 
  4.7   levies state aid.  The amount of reimbursement will be equal to 
  4.8   the liabilities of the dissolved district for which the 
  4.9   consolidated district is obligated less the aggregate of the 
  4.10  following which has been or will be received by the consolidated 
  4.11  district at or after the time of attachment from or as a result 
  4.12  of the dissolution and attachment of the dissolved district: 
  4.13     (1) all taxes inuring to the consolidating district upon 
  4.14  levies made by the dissolved district; 
  4.15     (2) all cash, bank accounts, investments, and other current 
  4.16  assets; 
  4.17     (3) earned state aids of the dissolved districts; 
  4.18     (4) returns from the sale of property of the dissolved 
  4.19  district. 
  4.20     (b) The amount of such special levy so computed shall be 
  4.21  certified to the county auditor with the other tax requirements 
  4.22  of the consolidated district but separately stated and 
  4.23  identified.  The auditor shall add the amount of special levy so 
  4.24  certified to the school rate for the territory in the 
  4.25  consolidated district which came from the dissolved district and 
  4.26  include it in the levy on the taxable property in that 
  4.27  territory.  The county auditor shall not spread more of the 
  4.28  amount certified for special levy in any year than will amount 
  4.29  to 20 percent of the school levy without the special levy, 
  4.30  leaving the remaining part of the certified amount for levy in 
  4.31  successive years without further certification.  Any amount of 
  4.32  reimbursement to which it is entitled omitted by the 
  4.33  consolidated district from its initial certification for special 
  4.34  levy may be certified in a subsequent year for levy in the same 
  4.35  manner as the levy upon initial certification. 
  4.36     The levy authorized by this subdivision shall be in 
  5.1   addition to those otherwise authorized for a district the 
  5.2   special state aid shall be approved by the commissioner of 
  5.3   children, families, and learning.  
  5.4      Sec. 8.  Minnesota Statutes 1998, section 123A.73, 
  5.5   subdivision 9, is amended to read: 
  5.6      Subd. 9.  [REORGANIZATION OPERATING DEBT LEVIES.] (a) A 
  5.7   district that receives revenue under section 123A.39, 
  5.8   subdivision 3, for cooperation or has combined according to 
  5.9   sections 123A.35 to 123A.43 may levy is eligible for state aid 
  5.10  to eliminate reorganization operating debt as defined in section 
  5.11  123B.82, clause (1).  The amount of the debt must be certified 
  5.12  over a period of five years.  After the effective date of 
  5.13  combination according to sections 123A.35 to 123A.43, the levy 
  5.14  may be certified and spread either 
  5.15     (1) only on the property in the combined district that 
  5.16  would have been taxable in the preexisting district that 
  5.17  incurred the debt, or 
  5.18     (2) on all of the taxable property in the combined district.
  5.19     (b) A district that has reorganized according to section 
  5.20  123A.46 or 123A.48 may levy is eligible for state aid to 
  5.21  eliminate reorganization operating debt as defined in section 
  5.22  123B.82, clause (2).  The amount of debt must be certified over 
  5.23  a period not to exceed five years and may be spread either 
  5.24     (1) only on the property in the newly created or enlarged 
  5.25  district which was taxable in the preexisting district that 
  5.26  incurred the debt, or 
  5.27     (2) on all of the taxable property in the newly created or 
  5.28  enlarged district. 
  5.29     Sec. 9.  Minnesota Statutes 1998, section 123A.73, 
  5.30  subdivision 12, is amended to read: 
  5.31     Subd. 12.  [LEVY STATE AID FOR SEVERANCE PAY OR EARLY 
  5.32  RETIREMENT INCENTIVES.] The board of a newly created or enlarged 
  5.33  district to which part or all of a dissolved district was 
  5.34  attached according to section 123A.46 may levy is eligible for 
  5.35  state aid for severance pay or early retirement incentives for 
  5.36  licensed and nonlicensed employees who resign or retire early as 
  6.1   a result of the dissolution or consolidation, if the 
  6.2   commissioner approves the incentives and the amount to be 
  6.3   levied.  The amount may be levied over a period of up to five 
  6.4   years and must be spread in whole or in part on the property of 
  6.5   a preexisting district or the newly created or enlarged 
  6.6   district, as determined by the board of the newly created or 
  6.7   enlarged district of state aid. 
  6.8      Sec. 10.  Minnesota Statutes 1998, section 123A.76, is 
  6.9   amended to read: 
  6.10     123A.76 [EXPENSES OF TRANSITION.] 
  6.11     The board of a district to which a dissolved district is 
  6.12  attached pursuant to section 123A.46, may, for the purpose of 
  6.13  paying the expenses of negotiations and other administrative 
  6.14  expenses relating to the transition, enter into agreements with 
  6.15  banks or any person to take its orders at any rate of interest 
  6.16  not to exceed seven percent per annum.  These orders shall be 
  6.17  paid by the treasurer of the district from district funds after 
  6.18  the effective date of the dissolution and attachment.  
  6.19  Notwithstanding the provisions of sections 124D.22, 126C.40 to 
  6.20  126C.45, and 126C.48, the district may, in the year the 
  6.21  dissolution and attachment becomes effective, levy receive state 
  6.22  aid in an amount equal to the amount of the orders issued 
  6.23  pursuant to this subdivision and the interest on these orders.  
  6.24  No district shall issue orders for funds or make a levy pursuant 
  6.25  receive state aid according to this subdivision without the 
  6.26  commissioner's approval of the expenses to be paid with the 
  6.27  funds from the orders and levy state aid. 
  6.28     Sec. 11.  Minnesota Statutes 1998, section 123B.53, 
  6.29  subdivision 4, is amended to read: 
  6.30     Subd. 4.  [DEBT SERVICE EQUALIZATION REVENUE.] (a) For 
  6.31  fiscal years 1995 2001 and later, the debt service equalization 
  6.32  revenue of a district equals the eligible debt service revenue 
  6.33  minus the amount raised by a levy of ten five percent times the 
  6.34  adjusted net tax capacity of the district. 
  6.35     (b) For fiscal year 1993, debt service equalization revenue 
  6.36  equals one-third of the amount calculated in paragraph (a). 
  7.1      (c) For fiscal year 1994, debt service equalization revenue 
  7.2   equals two-thirds of the amount calculated in paragraph (a). 
  7.3      Sec. 12.  Minnesota Statutes 1998, section 123B.53, 
  7.4   subdivision 5, is amended to read: 
  7.5      Subd. 5.  [EQUALIZED DEBT SERVICE LEVY.] To obtain debt 
  7.6   service equalization revenue, a district must levy an amount not 
  7.7   to exceed the district's debt service equalization revenue times 
  7.8   the lesser of one or the ratio of: 
  7.9      (1) the quotient derived by dividing the adjusted net tax 
  7.10  capacity of the district for the year before the year the levy 
  7.11  is certified by the resident pupil units in the district for the 
  7.12  school year ending in the year prior to the year the levy is 
  7.13  certified; to 
  7.14     (2) $4,707.50 $10,000. 
  7.15     Sec. 13.  Minnesota Statutes 1998, section 123B.54, is 
  7.16  amended to read: 
  7.17     123B.54 [DEBT SERVICE APPROPRIATION.] 
  7.18     (a) $35,480,000 in fiscal year 1998, $38,159,000 in fiscal 
  7.19  year 1999, and $38,390,000 in fiscal year 2000 and $146,000,000 
  7.20  in fiscal year 2001 and each year thereafter is appropriated 
  7.21  from the general fund to the commissioner of children, families, 
  7.22  and learning for payment of debt service equalization aid under 
  7.23  section 123B.53.  The 2000 appropriation includes $3,842,000 for 
  7.24  1999 and $34,548,000 for 2000.  The 2001 appropriation includes 
  7.25  $3,455,000 for fiscal year 2000 and $131,400,000 for fiscal year 
  7.26  2001. 
  7.27     (b) The appropriations in paragraph (a) must be reduced by 
  7.28  the amount of any money specifically appropriated for the same 
  7.29  purpose in any year from any state fund. 
  7.30     Sec. 14.  Minnesota Statutes 1998, section 123B.57, 
  7.31  subdivision 1, is amended to read: 
  7.32     Subdivision 1.  [HEALTH AND SAFETY PROGRAM.] To receive 
  7.33  health and safety revenue for any fiscal year a district must 
  7.34  submit to the commissioner an application for aid and levy by 
  7.35  the date determined by the commissioner.  The application may be 
  7.36  for hazardous substance removal, fire and life safety code 
  8.1   repairs, labor and industry regulated facility and equipment 
  8.2   violations, and health, safety, and environmental management, 
  8.3   including indoor air quality management.  The application must 
  8.4   include a health and safety program adopted by the school 
  8.5   district board.  The program must include the estimated cost, 
  8.6   per building, of the program by fiscal year. 
  8.7      Sec. 15.  Minnesota Statutes 1998, section 123B.57, 
  8.8   subdivision 3, is amended to read: 
  8.9      Subd. 3.  [HEALTH AND SAFETY REVENUE.] A district's health 
  8.10  and safety revenue for a fiscal year equals: 
  8.11     (1) the sum of (a) the total approved cost of the 
  8.12  district's hazardous substance plan for fiscal years 1985 
  8.13  through 1989, plus (b) the total approved cost of the district's 
  8.14  health and safety program for fiscal year 1990 through the 
  8.15  current fiscal year to which the levy is attributable, minus 
  8.16     (2) the sum of (a) the district's total hazardous substance 
  8.17  aid and levy for fiscal years 1985 through 1989 under sections 
  8.18  124.245 and 275.125, subdivision 11c, plus (b) the district's 
  8.19  health and safety revenue under this subdivision, for years 
  8.20  before the current fiscal year to which the levy is 
  8.21  attributable, plus (c) the amount of other federal, state, or 
  8.22  local receipts for the district's hazardous substance or health 
  8.23  and safety programs for fiscal year 1985 through the current 
  8.24  fiscal year to which the levy is attributable. 
  8.25     Sec. 16.  Minnesota Statutes 1998, section 123B.57, 
  8.26  subdivision 5, is amended to read: 
  8.27     Subd. 5.  [HEALTH AND SAFETY AID.] A district's health and 
  8.28  safety revenue is provided entirely through state aid is the 
  8.29  difference between its health and safety revenue and its health 
  8.30  and safety levy.  If a district does not levy the entire amount 
  8.31  permitted, health and safety aid must be reduced in proportion 
  8.32  to the actual amount levied.  Health and safety aid may not be 
  8.33  reduced as a result of reducing a district's health and safety 
  8.34  levy according to section 123B.79.  
  8.35     Sec. 17.  Minnesota Statutes 1998, section 123B.59, 
  8.36  subdivision 1, is amended to read: 
  9.1      Subdivision 1.  [TO QUALIFY.] An independent or special 
  9.2   school district qualifies to participate in the alternative 
  9.3   facilities bonding and levy program if the district has: 
  9.4      (1) more than 66 students per grade; 
  9.5      (2) over 1,850,000 square feet of space; 
  9.6      (3) average age of building space is 20 years or older; 
  9.7      (4) insufficient funds from projected health and safety 
  9.8   revenue and capital facilities revenue to meet the requirements 
  9.9   for deferred maintenance, to make accessibility improvements, or 
  9.10  to make fire, safety, or health repairs; and 
  9.11     (5) a ten-year facility plan approved by the commissioner 
  9.12  according to subdivision 2. 
  9.13     Sec. 18.  Minnesota Statutes 1998, section 123B.59, 
  9.14  subdivision 2, is amended to read: 
  9.15     Subd. 2.  [TEN-YEAR PLAN.] (a) A qualifying district must 
  9.16  have a ten-year facility plan approved by the commissioner prior 
  9.17  to January 1, 1999, that includes an inventory of projects and 
  9.18  costs that would be eligible for: 
  9.19     (1) health and safety revenue; 
  9.20     (2) disabled access levy; and 
  9.21     (3) deferred capital expenditures and maintenance projects 
  9.22  necessary to prevent further erosion of facilities. 
  9.23     (b) The school district must: 
  9.24     (1) annually update the plan but no projects may be added 
  9.25  to the plan after January 1, 1999; 
  9.26     (2) biennially submit a facility maintenance plan; and 
  9.27     (3) indicate whether or not the district will issue bonds 
  9.28  to finance the plan or levy for the costs. 
  9.29     Sec. 19.  Minnesota Statutes 1998, section 123B.59, 
  9.30  subdivision 4, is amended to read: 
  9.31     Subd. 4.  [LEVY PROHIBITED FOR CAPITAL PROJECTS LIMITS ON 
  9.32  PARTICIPATION.] A district that participates in the alternative 
  9.33  facilities bonding and levy program is not eligible to levy and 
  9.34  cannot receive aid under sections 123B.57 and 123B.58 for any 
  9.35  capital projects funded under this section.  A district may levy 
  9.36  and receive aid for health and safety environmental management 
 10.1   costs and health and safety regulatory, hazard assessment, 
 10.2   record keeping, and maintenance programs as defined in section 
 10.3   123A.443, subdivision 2, and approved by the commissioner. 
 10.4      Sec. 20.  Minnesota Statutes 1998, section 123B.59, 
 10.5   subdivision 6, is amended to read: 
 10.6      Subd. 6.  [ALTERNATIVE FACILITIES AID.] A district's 
 10.7   alternative facilities aid is the amount equal to the district's 
 10.8   annual debt service costs, provided that the amount does not 
 10.9   exceed the amount certified to be levied for those purposes for 
 10.10  taxes payable in 1997, or for a district that made a levy under 
 10.11  subdivision 5, paragraph (b), the lesser of the district's 
 10.12  annual levy amount, or one-sixth of the amount of levy that it 
 10.13  certified for that purpose for taxes payable in 1998 approved 
 10.14  alternative facilities revenue. 
 10.15     Sec. 21.  Minnesota Statutes 1998, section 123B.59, 
 10.16  subdivision 7, is amended to read: 
 10.17     Subd. 7.  [ALTERNATIVE FACILITIES APPROPRIATION.] (a) An 
 10.18  amount not to exceed $19,700,000 for fiscal year 2000 and 
 10.19  $20,000,000 $40,000,000 for fiscal year 2001 and each year 
 10.20  thereafter is appropriated from the general fund to the 
 10.21  commissioner of children, families, and learning for payment of 
 10.22  alternative facilities aid under subdivision 6.  
 10.23     (b) The appropriation in paragraph (a) must be reduced by 
 10.24  the amount of any money specifically appropriated for the same 
 10.25  purpose in any year from any state fund. 
 10.26     Sec. 22.  Minnesota Statutes 1998, section 123B.61, is 
 10.27  amended to read: 
 10.28     123B.61 [PURCHASE OF CERTAIN EQUIPMENT.] 
 10.29     The board of a district may issue general obligation 
 10.30  certificates of indebtedness or capital notes subject to the 
 10.31  district debt limits to purchase:  (a) vehicles, computers, 
 10.32  telephone systems, cable equipment, photocopy and office 
 10.33  equipment, technological equipment for instruction, and other 
 10.34  capital equipment having an expected useful life at least as 
 10.35  long as the terms of the certificates or notes; and (b) computer 
 10.36  hardware and software, without regard to its expected useful 
 11.1   life, whether bundled with machinery or equipment or unbundled, 
 11.2   together with application development services and training 
 11.3   related to the use of the computer.  The certificates or notes 
 11.4   must be payable in not more than five years and must be issued 
 11.5   on the terms and in the manner determined by the board.  The 
 11.6   certificates or notes may be issued by resolution and without 
 11.7   the requirement for an election.  The certificates or notes are 
 11.8   general obligation bonds for purposes of section 126C.55.  A tax 
 11.9   levy must be made for the payment of the principal and interest 
 11.10  on the certificates or notes, in accordance with section 475.61, 
 11.11  as in the case of bonds.  The sum of the tax levies under this 
 11.12  section and section 123B.62 for each year must not exceed the 
 11.13  amount of the district's total operating capital revenue for the 
 11.14  year the initial debt service levies are certified.  The 
 11.15  district's general education levy for each year must be reduced 
 11.16  by the sum of (1) the amount of the tax levies for debt service 
 11.17  certified for each year for payment of the principal and 
 11.18  interest on the certificates or notes as required by section 
 11.19  475.61, and (2) any excess amount in the debt redemption fund 
 11.20  used to retire certificates or notes issued after April 1, 1997, 
 11.21  other than amounts used to pay capitalized interest.  A district 
 11.22  using an excess amount in the debt redemption fund to retire the 
 11.23  certificates or notes shall report the amount used for this 
 11.24  purpose to the commissioner by July 15 of the following fiscal 
 11.25  year.  A district having an outstanding capital loan under 
 11.26  section 126C.69 or an outstanding debt service loan under 
 11.27  section 126C.68 must not use an excess amount in the debt 
 11.28  redemption fund to retire the certificates or notes.  The 
 11.29  district must annually transfer the amount necessary to repay 
 11.30  these certificates or notes from its unreserved general fund to 
 11.31  a reserved account for this purpose. 
 11.32     Sec. 23.  Minnesota Statutes 1998, section 123B.62, is 
 11.33  amended to read: 
 11.34     123B.62 [BONDS FOR CERTAIN CAPITAL FACILITIES.] 
 11.35     (a) In addition to other bonding authority, with approval 
 11.36  of the commissioner, a district may issue general obligation 
 12.1   bonds for certain capital projects under this section.  The 
 12.2   bonds must be used only to make capital improvements including: 
 12.3      (1) under section 126C.10, subdivision 14, total operating 
 12.4   capital revenue uses specified in clauses (4), (6), (7), (8), 
 12.5   (9), and (10); 
 12.6      (2) the cost of energy modifications; 
 12.7      (3) improving handicap accessibility to school buildings; 
 12.8   and 
 12.9      (4) bringing school buildings into compliance with life and 
 12.10  safety codes and fire codes.  
 12.11     (b) Before a district issues bonds under this subdivision, 
 12.12  it must publish notice of the intended projects, the amount of 
 12.13  the bond issue, and the total amount of district indebtedness.  
 12.14     (c) A bond issue tentatively authorized by the board under 
 12.15  this subdivision becomes finally authorized unless a petition 
 12.16  signed by more than 15 percent of the registered voters of the 
 12.17  district is filed with the school board within 30 days of the 
 12.18  board's adoption of a resolution stating the board's intention 
 12.19  to issue bonds.  The percentage is to be determined with 
 12.20  reference to the number of registered voters in the district on 
 12.21  the last day before the petition is filed with the board.  The 
 12.22  petition must call for a referendum on the question of whether 
 12.23  to issue the bonds for the projects under this section.  The 
 12.24  approval of 50 percent plus one of those voting on the question 
 12.25  is required to pass a referendum authorized by this section. 
 12.26     (d) The bonds must be paid off within ten years of 
 12.27  issuance.  The bonds must be issued in compliance with chapter 
 12.28  475, except as otherwise provided in this section.  A tax levy 
 12.29  must be made for the payment of principal and interest on the 
 12.30  bonds in accordance with section 475.61.  The sum of the tax 
 12.31  levies under this section for each year must not exceed the 
 12.32  amount of the district's total operating capital revenue for the 
 12.33  year the initial debt service levies are certified.  The 
 12.34  district's general education levy for each year must be reduced 
 12.35  by the sum of (1) the amount of the tax levies for debt service 
 12.36  certified for each year for payment of the principal and 
 13.1   interest on the bonds, and (2) any excess amount in the debt 
 13.2   redemption fund used to retire bonds issued after April 1, 1997, 
 13.3   other than amounts used to pay capitalized interest.  A district 
 13.4   using an excess amount in the debt redemption fund to retire the 
 13.5   bonds shall report the amount used for this purpose to the 
 13.6   commissioner by July 15 of the following fiscal year.  A 
 13.7   district having an outstanding capital loan under section 
 13.8   126C.69 or an outstanding debt service loan under section 
 13.9   126C.68 must not use an excess amount in the debt redemption 
 13.10  fund to retire the bonds. 
 13.11     (e) The district must annually transfer the amount 
 13.12  necessary to repay these bonds from its unreserved general fund 
 13.13  to a reserved account for this purpose. 
 13.14     Notwithstanding paragraph (d), bonds issued by a district 
 13.15  within the first five years following voter approval of a 
 13.16  combination according to section 123A.37, subdivision 2, must be 
 13.17  paid off within 20 years of issuance.  All the other provisions 
 13.18  and limitation of paragraph (d) apply. 
 13.19     Sec. 24.  Minnesota Statutes 1998, section 123B.64, 
 13.20  subdivision 2, is amended to read: 
 13.21     Subd. 2.  [REVENUE AID.] A district's historic building 
 13.22  revenue aid is equal to $100 times the number of resident pupil 
 13.23  units served in the school building. 
 13.24     Sec. 25.  Minnesota Statutes 1998, section 124D.135, 
 13.25  subdivision 1, is amended to read: 
 13.26     Subdivision 1.  [REVENUE.] The revenue for early childhood 
 13.27  family education programs for a school district equals $101.25 
 13.28  for 1998 and $113.50 for 1999 and later fiscal years times the 
 13.29  greater of: 
 13.30     (1) 150; or 
 13.31     (2) the number of people under five years of age residing 
 13.32  in the district on October 1 of the previous school year. 
 13.33     Early childhood family education revenue is provided 
 13.34  entirely through state aid. 
 13.35     Sec. 26.  Minnesota Statutes 1998, section 124D.135, 
 13.36  subdivision 6, is amended to read: 
 14.1      Subd. 6.  [HOME VISITING LEVY AID.] A district that enters 
 14.2   into a collaborative agreement to provide education services and 
 14.3   social services to families with young children may levy is 
 14.4   eligible for state aid in an amount equal to $1.60 times the 
 14.5   number of people under five years of age residing in the 
 14.6   district on September 1 of the last school year.  Levy Revenue 
 14.7   under this subdivision must not be included as revenue under 
 14.8   subdivision 1.  The revenue must be used for home visiting 
 14.9   programs under section 124D.13, subdivision 4.  
 14.10     Sec. 27.  Minnesota Statutes 1998, section 124D.20, 
 14.11  subdivision 1, is amended to read: 
 14.12     Subdivision 1.  [TOTAL COMMUNITY EDUCATION REVENUE.] 
 14.13  Community education revenue equals the sum of a district's 
 14.14  general community education revenue and youth service program 
 14.15  revenue.  Community education revenue is provided entirely 
 14.16  through state aid. 
 14.17     Sec. 28.  Minnesota Statutes 1998, section 124D.22, 
 14.18  subdivision 2, is amended to read: 
 14.19     Subd. 2.  [EXTENDED DAY REVENUE.] The extended day revenue 
 14.20  for an eligible district equals the approved additional cost of 
 14.21  providing services to children with disabilities or children 
 14.22  experiencing family or related problems of a temporary nature 
 14.23  who participate in the extended day program.  Extended revenue 
 14.24  is provided entirely through state aid. 
 14.25     Sec. 29.  Minnesota Statutes 1998, section 124D.56, 
 14.26  subdivision 1, is amended to read: 
 14.27     Subdivision 1.  [REVENUE AMOUNT.] A district that is 
 14.28  eligible according to section 124D.20, subdivision 2, may 
 14.29  receive revenue for a program for adults with disabilities.  
 14.30  Revenue for the program for adults with disabilities for a 
 14.31  district or a group of districts equals the lesser of:  
 14.32     (1) the actual expenditures for approved programs and 
 14.33  budgets; or 
 14.34     (2) $60,000.  
 14.35     Revenue for the adults with disabilities program is 
 14.36  provided entirely through state aid. 
 15.1      Sec. 30.  Minnesota Statutes 1998, section 124D.86, 
 15.2   subdivision 5, is amended to read: 
 15.3      Subd. 5.  [INTEGRATION AID.] A district's integration aid 
 15.4   equals 67 percent for fiscal year 2000 and 78 100 percent for 
 15.5   fiscal year 2001 and thereafter of the district's integration 
 15.6   revenue as defined in subdivision 3. 
 15.7      Sec. 31.  Minnesota Statutes 1998, section 126C.13, 
 15.8   subdivision 1, is amended to read: 
 15.9      Subdivision 1.  [GENERAL EDUCATION TAX RATE.] The 
 15.10  commissioner must establish the general education tax rate by 
 15.11  July 1 of each year for levies payable in the following year.  
 15.12  The general education tax capacity rate must be a rate, rounded 
 15.13  up to the nearest hundredth of a percent, that, when applied to 
 15.14  the adjusted net tax capacity general education tax base for all 
 15.15  districts, raises the amount specified in this subdivision.  The 
 15.16  general education tax rate must be the rate that raises 
 15.17  $1,385,500,000 for fiscal year 1999, $1,325,500,000 for fiscal 
 15.18  year 2000, and $1,387,100,000 $480,000,000 for fiscal year 2001, 
 15.19  and later fiscal years.  The general education tax rate may not 
 15.20  be changed due to changes or corrections made to a district's 
 15.21  adjusted net tax capacity general education tax base after the 
 15.22  tax rate has been established.  If the levy target for fiscal 
 15.23  year 1999 or fiscal year 2000 is changed by another law enacted 
 15.24  during the 1997 or 1998 session, the commissioner shall reduce 
 15.25  the general education levy target in this section by the amount 
 15.26  of the reduction in the enacted law. 
 15.27     Sec. 32.  Minnesota Statutes 1998, section 126C.13, 
 15.28  subdivision 2, is amended to read: 
 15.29     Subd. 2.  [GENERAL EDUCATION LEVY.] To obtain general 
 15.30  education revenue, excluding transition revenue and supplemental 
 15.31  revenue, a district may levy an amount not to exceed the general 
 15.32  education tax rate times the adjusted net tax capacity general 
 15.33  education tax base of the district for the preceding year.  If 
 15.34  the amount of the general education levy would exceed the 
 15.35  general education revenue, excluding supplemental revenue, the 
 15.36  general education levy must be determined according to 
 16.1   subdivision 3.  
 16.2      Sec. 33.  Minnesota Statutes 1998, section 126C.13, 
 16.3   subdivision 3, is amended to read: 
 16.4      Subd. 3.  [GENERAL EDUCATION LEVY; DISTRICTS OFF THE 
 16.5   FORMULA.] If the amount of the general education levy for a 
 16.6   district exceeds the district's general education revenue, 
 16.7   excluding transition revenue and supplemental revenue, the 
 16.8   amount of the general education levy must be limited to the 
 16.9   following: 
 16.10     (1) the district's general education revenue, excluding 
 16.11  transition revenue and supplemental revenue; plus 
 16.12     (2) the amount of the aid reduction for the same school 
 16.13  year according to section 126C.14; minus 
 16.14     (3) payments made for the same school year according to 
 16.15  section 126C.21, subdivision 3. 
 16.16     For purposes of statutory cross-reference, a levy made 
 16.17  according to this subdivision shall be construed to be the levy 
 16.18  made according to subdivision 2. 
 16.19     Sec. 34.  Minnesota Statutes 1998, section 126C.13, 
 16.20  subdivision 4, is amended to read: 
 16.21     Subd. 4.  [GENERAL EDUCATION AID.] A district's general 
 16.22  education aid is the sum of the following amounts:  
 16.23     (1) the product of (i) the difference between the general 
 16.24  education revenue, excluding transition revenue and supplemental 
 16.25  revenue, and the general education levy, times (ii) the ratio of 
 16.26  the actual amount levied to the permitted levy; 
 16.27     (2) transition aid according to section 126C.10, 
 16.28  subdivision 22; 
 16.29     (3) supplemental aid according to section 127A.49; 
 16.30     (4) shared time aid according to section 126C.01, 
 16.31  subdivision 7; and 
 16.32     (5) (3) referendum aid according to section 126C.17. 
 16.33     Sec. 35.  Minnesota Statutes 1998, section 126C.14, is 
 16.34  amended to read: 
 16.35     126C.14 [GENERAL EDUCATION LEVY EQUITY.] 
 16.36     If a district's general education levy is determined 
 17.1   according to section 126C.13, subdivision 3, an amount must be 
 17.2   deducted from state aid authorized in this chapter and chapters 
 17.3   120B, 122A, 123A, 123B, 124B, 124D, 125A, and 127A, receivable 
 17.4   for the same school year, and from other state payments 
 17.5   receivable for the same school year authorized in chapter 273.  
 17.6   The aid in section 124D.111 must not be reduced. 
 17.7      The amount of the deduction equals the difference between: 
 17.8      (1) the general education tax rate, according to section 
 17.9   126C.13, times the district's adjusted net tax capacity general 
 17.10  education tax base used to determine the general education aid 
 17.11  for the same school year; and 
 17.12     (2) the district's general education revenue, excluding 
 17.13  transition revenue and supplemental revenue, for the same school 
 17.14  year, according to section 126C.10. 
 17.15     Sec. 36.  Minnesota Statutes 1998, section 126C.40, 
 17.16  subdivision 4, is amended to read: 
 17.17     Subd. 4.  [INTERACTIVE TELEVISION.] (a) A district with its 
 17.18  central administrative office located within economic 
 17.19  development region one, two, three, four, five, six, seven, 
 17.20  eight, nine, and ten may apply to the commissioner for ITV 
 17.21  revenue up to the greater of .5 percent of the adjusted net tax 
 17.22  capacity of the district or $25,000.  Eligible interactive 
 17.23  television expenditures include the construction, maintenance, 
 17.24  and lease costs of an interactive television system for 
 17.25  instructional purposes.  An eligible school district that has 
 17.26  completed the construction of its interactive television system 
 17.27  may also purchase computer hardware and software used primarily 
 17.28  for instructional purposes and access to the Internet provided 
 17.29  that its total expenditures for interactive television 
 17.30  maintenance and lease costs and for computer hardware and 
 17.31  software under this subdivision do not exceed its interactive 
 17.32  television revenue for fiscal year 1998.  The approval by the 
 17.33  commissioner and the application procedures set forth in 
 17.34  subdivision 1 shall apply to the revenue in this subdivision.  
 17.35  In granting the approval, the commissioner shall consider 
 17.36  whether the district is maximizing efficiency through peak use 
 18.1   and off-peak use pricing structures. 
 18.2      (b) To obtain ITV revenue, a district may levy an amount 
 18.3   not to exceed the district's ITV revenue times the lesser of one 
 18.4   or the ratio of: 
 18.5      (1) the quotient derived by dividing the adjusted net tax 
 18.6   capacity of the district for the year before the year the levy 
 18.7   is certified by the resident pupil units in the district for the 
 18.8   year to which the levy is attributable; to 
 18.9      (2) $10,000.  
 18.10     (c) A district's ITV revenue is provided entirely through 
 18.11  state aid is the difference between its ITV revenue and the ITV 
 18.12  levy. 
 18.13     (d) (c) The revenue in the first year after reorganization 
 18.14  for a district that has reorganized under sections 123A.35 to 
 18.15  123A.41, 123A.46, or 123A.48 shall be the greater of: 
 18.16     (1) the revenue computed for the reorganized district under 
 18.17  paragraph (a), or 
 18.18     (2)(i) for two districts that reorganized, 75 percent of 
 18.19  the revenue computed as if the districts involved in the 
 18.20  reorganization were separate, or 
 18.21     (ii) for three or more districts that reorganized, 50 
 18.22  percent of the revenue computed as if the districts involved in 
 18.23  the reorganization were separate. 
 18.24     (e) (d) The revenue in paragraph (d) (c) is increased by 
 18.25  the difference between the initial revenue and ITV lease costs 
 18.26  for leases that had been entered into by the preexisting 
 18.27  districts on the effective date of the consolidation or 
 18.28  combination and with a term not exceeding ten years.  This 
 18.29  increased revenue is only available for the remaining term of 
 18.30  the lease.  However, in no case shall the revenue exceed the 
 18.31  amount available had the preexisting districts received revenue 
 18.32  separately. 
 18.33     (f) (e) Effective for fiscal year 2000, the revenue under 
 18.34  this section shall be 75 percent of the amount determined in 
 18.35  paragraph (a); for fiscal year 2001, 50 percent of the amount in 
 18.36  paragraph (a); and for fiscal year 2002, 25 percent of the 
 19.1   amount in paragraph (a). 
 19.2      (g) (f) This section expires effective for revenue for 
 19.3   fiscal year 2003, or when leases in existence on the effective 
 19.4   date of Laws 1997, First Special Session chapter 4, expire.  
 19.5      Sec. 37.  Minnesota Statutes 1998, section 126C.41, 
 19.6   subdivision 1, is amended to read: 
 19.7      Subdivision 1.  [HEALTH INSURANCE.] (a) A district may levy 
 19.8   is eligible for state aid equal to the amount necessary to make 
 19.9   employer contributions for insurance for retired employees under 
 19.10  this subdivision.  
 19.11     (b) The school board of a joint vocational technical 
 19.12  district formed under sections 136C.60 to 136C.69 and the school 
 19.13  board of a school district may provide employer-paid hospital, 
 19.14  medical, and dental benefits to a person who: 
 19.15     (1) is eligible for employer-paid insurance under 
 19.16  collective bargaining agreements or personnel plans in effect on 
 19.17  June 30, 1992; 
 19.18     (2) has at least 25 years of service credit in the public 
 19.19  pension plan of which the person is a member on the day before 
 19.20  retirement or, in the case of a teacher, has a total of at least 
 19.21  25 years of service credit in the teachers retirement 
 19.22  association, a first-class city teacher retirement fund, or any 
 19.23  combination of these; 
 19.24     (3) upon retirement is immediately eligible for a 
 19.25  retirement annuity; 
 19.26     (4) is at least 55 and not yet 65 years of age; and 
 19.27     (5) retires on or after May 15, 1992, and before July 21, 
 19.28  1992. 
 19.29     A school board paying insurance under this subdivision may 
 19.30  not exclude any eligible employees. 
 19.31     (c) An employee who is eligible both for the health 
 19.32  insurance benefit under this subdivision and for an early 
 19.33  retirement incentive under a collective bargaining agreement or 
 19.34  personnel plan established by the employer must select either 
 19.35  the early retirement incentive provided under the collective 
 19.36  bargaining agreement personnel plan or the incentive provided 
 20.1   under this subdivision, but may not receive both.  For purposes 
 20.2   of this subdivision, a person retires when the person terminates 
 20.3   active employment and applies for retirement benefits.  The 
 20.4   retired employee is eligible for single and dependent coverages 
 20.5   and employer payments to which the person was entitled 
 20.6   immediately before retirement, subject to any changes in 
 20.7   coverage and employer and employee payments through collective 
 20.8   bargaining or personnel plans, for employees in positions 
 20.9   equivalent to the position from which the employee retired.  The 
 20.10  retired employee is not eligible for employer-paid life 
 20.11  insurance.  Eligibility ceases when the retired employee attains 
 20.12  the age of 65, or when the employee chooses not to receive the 
 20.13  retirement benefits for which the employee has applied, or when 
 20.14  the employee is eligible for employer-paid health insurance from 
 20.15  a new employer.  Coverages must be coordinated with relevant 
 20.16  health insurance benefits provided through the federally 
 20.17  sponsored Medicare program.  
 20.18     (d) Unilateral implementation of this section by a public 
 20.19  employer is not an unfair labor practice for purposes of chapter 
 20.20  179A.  The authority provided in this subdivision for an 
 20.21  employer to pay health insurance costs for certain retired 
 20.22  employees is not subject to the limits in section 179A.20, 
 20.23  subdivision 2a. 
 20.24     (e) If a school district levies receives state aid 
 20.25  according to this subdivision, it may not also levy receive 
 20.26  state aid according to section 123A.73, subdivision 12, for 
 20.27  eligible employees. 
 20.28     Sec. 38.  Minnesota Statutes 1998, section 126C.41, 
 20.29  subdivision 3, is amended to read: 
 20.30     Subd. 3.  [RETIREMENT LEVIES AID.] (1) In addition to the 
 20.31  excess levy authorized in 1976 any district within a city of the 
 20.32  first class which was authorized in 1975 to make a retirement 
 20.33  levy under Minnesota Statutes 1974, section 275.127 and chapter 
 20.34  422A may levy is eligible for state aid in an amount per pupil 
 20.35  unit which is equal to the amount levied in 1975 payable 1976, 
 20.36  under Minnesota Statutes 1974, section 275.127 and chapter 422A, 
 21.1   divided by the number of pupil units in the district in 
 21.2   1976-1977. 
 21.3      (2) In 1979 and each year thereafter, any district which 
 21.4   qualified in 1976 for an extra levy under paragraph (1) shall be 
 21.5   allowed to levy is eligible for state aid in the same amount as 
 21.6   levied for retirement in 1978 under this clause reduced each 
 21.7   year by ten percent of the difference between the amount levied 
 21.8   for retirement in 1971 under Minnesota Statutes 1971, sections 
 21.9   275.127 and 422.01 to 422.54 and the amount levied for 
 21.10  retirement in 1975 under Minnesota Statutes 1974, section 
 21.11  275.127 and chapter 422A. 
 21.12     (3) In 1991 and each year thereafter, a district to which 
 21.13  this subdivision applies may levy is eligible for state aid in 
 21.14  an additional amount required for contributions to the 
 21.15  Minneapolis employees retirement fund as a result of the maximum 
 21.16  dollar amount limitation on state contributions to the fund 
 21.17  imposed under section 422A.101, subdivision 3.  The 
 21.18  additional levy state aid must not exceed the most recent amount 
 21.19  certified by the board of the Minneapolis employees retirement 
 21.20  fund as the district's share of the contribution requirement in 
 21.21  excess of the maximum state contribution under section 422A.101, 
 21.22  subdivision 3.  
 21.23     (4) For taxes payable in 1994 and thereafter, special 
 21.24  school district No. 1, Minneapolis, and independent school 
 21.25  district No. 625, St. Paul, may levy for are eligible for state 
 21.26  aid equal to the increase in the employer retirement fund 
 21.27  contributions, under Laws 1992, chapter 598, article 5, section 
 21.28  1.  
 21.29     (5) If the employer retirement fund contributions under 
 21.30  section 354A.12, subdivision 2a, are increased for fiscal year 
 21.31  1994 or later fiscal years, special school district No. 1, 
 21.32  Minneapolis, and independent school district No. 625, St. Paul, 
 21.33  may levy in payable 1994 or later are eligible for state aid in 
 21.34  an amount equal to the amount derived by applying the net 
 21.35  increase in the employer retirement fund contribution rate of 
 21.36  the respective teacher retirement fund association between 
 22.1   fiscal year 1993 and the fiscal year beginning in the year after 
 22.2   the levy is certified to the total covered payroll of the 
 22.3   applicable teacher retirement fund association.  If an 
 22.4   applicable school district levies receives aid under this 
 22.5   paragraph, they may not levy the district is not eligible for 
 22.6   state aid under paragraph (4). 
 22.7      (6) In addition to the levy state aid authorized under 
 22.8   paragraph (5), special school district No. 1, Minneapolis, may 
 22.9   also levy payable in 1997 or later is also eligible for state 
 22.10  aid in an amount equal to the contributions under section 
 22.11  423A.02, subdivision 3, and may also levy in payable 1994 or 
 22.12  later receive state aid in an amount equal to the state aid 
 22.13  contribution under section 354A.12, subdivision 3b.  Independent 
 22.14  school district No. 625, St. Paul, may levy payable in 1997 or 
 22.15  later is eligible for additional state aid in an amount equal to 
 22.16  the supplemental contributions under section 423A.02, 
 22.17  subdivision 3.  
 22.18     Sec. 39.  Minnesota Statutes 1998, section 126C.41, 
 22.19  subdivision 4, is amended to read: 
 22.20     Subd. 4.  [MINNEAPOLIS HEALTH INSURANCE SUBSIDY.] Each year 
 22.21  special school district No. 1, Minneapolis, may make an 
 22.22  additional levy is eligible for state aid in an amount not to 
 22.23  exceed the amount raised by a net tax rate of .10 percent times 
 22.24  the adjusted net tax capacity for taxes payable in 1991 and 
 22.25  thereafter of the property in the district for the preceding 
 22.26  year.  The proceeds state aid may be used only to subsidize 
 22.27  health insurance costs for eligible teachers as provided in this 
 22.28  section.  
 22.29     "Eligible teacher" means a retired teacher who was a basic 
 22.30  member of the Minneapolis teachers retirement fund association, 
 22.31  who retired before May 1, 1974, or who had 20 or more years of 
 22.32  basic member service in the Minneapolis teacher retirement fund 
 22.33  association and retired before June 30, 1983, and who is not 
 22.34  eligible to receive the hospital insurance benefits of the 
 22.35  federal Medicare program of the Social Security Act without 
 22.36  payment of a monthly premium.  The district must notify eligible 
 23.1   teachers that a subsidy is available.  To obtain a subsidy, an 
 23.2   eligible teacher must submit to the school district a copy of 
 23.3   receipts for health insurance premiums paid.  The district must 
 23.4   disburse the health insurance premium subsidy to each eligible 
 23.5   teacher according to a schedule determined by the district, but 
 23.6   at least annually.  An eligible teacher may receive a subsidy up 
 23.7   to an amount equal to the lesser of 90 percent of the cost of 
 23.8   the eligible teacher's health insurance or up to 90 percent of 
 23.9   the cost of the number two qualified plan of health coverage for 
 23.10  individual policies made available by the Minnesota 
 23.11  comprehensive health association under chapter 62E.  
 23.12     If funds remaining from the previous year's health 
 23.13  insurance subsidy levy revenue, minus the previous year's 
 23.14  required subsidy amount, are sufficient to pay the estimated 
 23.15  current year subsidy, the levy state aid must be discontinued 
 23.16  until the remaining funds are estimated by the school board to 
 23.17  be insufficient to pay the subsidy. 
 23.18     This subdivision does not extend benefits to teachers who 
 23.19  retire after June 30, 1983, and does not create a contractual 
 23.20  right or claim for altering the benefits in this subdivision.  
 23.21  This subdivision does not restrict the district's right to 
 23.22  modify or terminate coverage under this subdivision. 
 23.23     Sec. 40.  Minnesota Statutes 1998, section 126C.42, 
 23.24  subdivision 1, is amended to read: 
 23.25     Subdivision 1.  [1977 STATUTORY OPERATING DEBT.] (a) In 
 23.26  each year in which so required by this subdivision, a district 
 23.27  must make an additional levy is eligible for state aid to 
 23.28  eliminate its statutory operating debt, determined as of June 
 23.29  30, 1977, and certified and adjusted by the commissioner.  This 
 23.30  levy for years prior to taxes payable in 2000 and the subsequent 
 23.31  state aid shall not be made in received for more than 30 
 23.32  successive years and each year before it is made received, it 
 23.33  must be approved by the commissioner and the approval shall 
 23.34  specify its amount.  This levy state aid shall be an amount 
 23.35  which is equal to the amount raised by a levy of a net tax rate 
 23.36  of 1.66 percent times the adjusted net tax capacity of the 
 24.1   district for the preceding year for taxes payable in 1991 and 
 24.2   thereafter; provided that in the last year in which the district 
 24.3   is required to make this levy, it must levy an amount not to 
 24.4   exceed the amount raised by a levy of a net tax rate of 1.66 
 24.5   percent times the adjusted net tax capacity of the district for 
 24.6   the preceding year for taxes payable in 1991 and thereafter.  
 24.7   When the sum of the cumulative levies made pursuant to this 
 24.8   subdivision, state aid received under this subdivision, and 
 24.9   transfers made according to section 123B.79, subdivision 6, 
 24.10  equals an amount equal to the statutory operating debt of the 
 24.11  district, the levy state aid shall be discontinued. 
 24.12     (b) The district must establish a special account in the 
 24.13  general fund which shall be designated "appropriated fund 
 24.14  balance reserve account for purposes of reducing statutory 
 24.15  operating debt" on its books and records.  This account shall 
 24.16  reflect the levy and state aid authorized pursuant to this 
 24.17  subdivision.  The proceeds of this levy and the state aid must 
 24.18  be used only for cash flow requirements and must not be used to 
 24.19  supplement district revenues or income for the purposes of 
 24.20  increasing the district's expenditures or budgets. 
 24.21     (c) Any district which is required to levy pursuant to that 
 24.22  receives state aid under this subdivision must certify the 
 24.23  maximum levy allowable under section 126C.13, subdivision 2, in 
 24.24  that same year. 
 24.25     (d) Each district shall make permanent fund balance 
 24.26  transfers so that the total statutory operating debt of the 
 24.27  district is reflected in the general fund as of June 30, 1977. 
 24.28     Sec. 41.  Minnesota Statutes 1998, section 126C.42, 
 24.29  subdivision 2, is amended to read: 
 24.30     Subd. 2.  [1983 OPERATING DEBT.] (1) Each year, a 
 24.31  district may make an additional levy is eligible for state aid 
 24.32  under this subdivision to eliminate a deficit in the net 
 24.33  unappropriated operating funds of the district, determined as of 
 24.34  June 30, 1983, and certified and adjusted by the commissioner.  
 24.35  This levy may in each year be an amount not to exceed state aid 
 24.36  equals the amount raised by a levy of a net tax rate of 1.85 
 25.1   percent times the adjusted net tax capacity for taxes payable in 
 25.2   1991 and thereafter of the district for the preceding year as 
 25.3   determined by the commissioner.  However, the total amount of 
 25.4   this levy for all years it is made and the state aid received 
 25.5   under this subdivision must not exceed the lesser of (a) the 
 25.6   amount of the deficit in the net unappropriated operating funds 
 25.7   of the district as of June 30, 1983, or (b) the amount of the 
 25.8   aid reduction, according to Laws 1981, Third Special Session 
 25.9   chapter 2, article 2, section 2, but excluding clauses (l), (m), 
 25.10  (n), (o), and (p), and Laws 1982, Third Special Session chapter 
 25.11  1, article 3, section 6, to the district in fiscal year 1983.  
 25.12  When the cumulative levies made and state aid received pursuant 
 25.13  to this subdivision equal the total amount permitted by this 
 25.14  subdivision, the levy state aid must be discontinued.  
 25.15     (2) The proceeds of this levy state aid must be used only 
 25.16  for cash flow requirements and must not be used to supplement 
 25.17  district revenues or income for the purposes of increasing the 
 25.18  district's expenditures or budgets.  
 25.19     (3) A district that levies pursuant to receives state aid 
 25.20  under this subdivision must certify the maximum levy allowable 
 25.21  under section 126C.13, subdivision 2, in that same year. 
 25.22     Sec. 42.  Minnesota Statutes 1998, section 126C.42, 
 25.23  subdivision 3, is amended to read: 
 25.24     Subd. 3.  [1985 OPERATING DEBT.] (1) Each year, a 
 25.25  district may levy is eligible for state aid under this 
 25.26  subdivision to eliminate a deficit in the net unappropriated 
 25.27  balance in the general fund of the district, determined as of 
 25.28  June 30, 1985, and certified and adjusted by the commissioner.  
 25.29  Each year this levy may be an amount not to exceed state aid 
 25.30  equals the amount raised by a levy of a net tax rate of 1.85 
 25.31  percent times the adjusted net tax capacity for taxes payable in 
 25.32  1991 and thereafter of the district for the preceding year.  
 25.33  However, the total amount of this levy made and state aid 
 25.34  received under this subdivision for all years it is made must 
 25.35  not exceed the amount of the deficit in the net unappropriated 
 25.36  balance in the general fund of the district as of June 30, 
 26.1   1985.  When the cumulative levies made pursuant to this 
 26.2   subdivision and the state aid received under this subdivision 
 26.3   equal the total amount permitted by this subdivision, the levy 
 26.4   state aid shall be discontinued.  
 26.5      (2) A district, if eligible, may levy receive revenue under 
 26.6   this subdivision or subdivision 2 but not both. 
 26.7      (3) The proceeds of this levy and state aid must be used 
 26.8   only for cash flow requirements and must not be used to 
 26.9   supplement district revenues or income for the purposes of 
 26.10  increasing the district's expenditures or budgets.  
 26.11     (4) A district that levies receives state aid pursuant to 
 26.12  this subdivision must certify the maximum levy allowable under 
 26.13  section 126C.13, subdivision 2, in that same year. 
 26.14     Sec. 43.  Minnesota Statutes 1998, section 126C.42, 
 26.15  subdivision 4, is amended to read: 
 26.16     Subd. 4.  [1992 OPERATING DEBT.] (a) For taxes payable for 
 26.17  calendar year 2003 fiscal year 2004 and earlier, a district that 
 26.18  has filed a plan pursuant to section 123B.83, subdivision 4, may 
 26.19  levy receive state aid, with the approval of the commissioner, 
 26.20  to eliminate a deficit in the net unappropriated balance in the 
 26.21  operating funds of the district, determined as of June 30, 1992, 
 26.22  and certified and adjusted by the commissioner.  Each year 
 26.23  this levy may state aid must be an amount not to exceed the 
 26.24  lesser of: 
 26.25     (1) an amount raised by a levy of a net tax rate of one 
 26.26  percent times the adjusted net tax capacity of the school 
 26.27  district; or 
 26.28     (2) $100,000. 
 26.29  This amount must be reduced by referendum revenue authorized 
 26.30  under section 126C.17 pursuant to the plan filed under section 
 26.31  123B.83.  However, the total amount of this levy for all years 
 26.32  it is made and the state aid received under this subdivision 
 26.33  must not exceed the amount of the deficit in the net 
 26.34  unappropriated balance in the operating funds of the district as 
 26.35  of June 30, 1992.  When the cumulative levies made pursuant to 
 26.36  this subdivision and state aid received under this subdivision 
 27.1   equal the total amount permitted by this subdivision, the levy 
 27.2   state aid must be discontinued.  
 27.3      (b) A district, if eligible, may levy receive state aid 
 27.4   under this subdivision or subdivision 2 or 3, or under section 
 27.5   123A.73, subdivision 9, or Laws 1992, chapter 499, article 7, 
 27.6   sections 16 or 17, but not under more than one. 
 27.7      (c) The proceeds of this levy and state aid must be used 
 27.8   only for cash flow requirements and must not be used to 
 27.9   supplement district revenues or income for the purposes of 
 27.10  increasing the district's expenditures or budgets.  
 27.11     (d) Any district that levies receives state aid pursuant to 
 27.12  this subdivision must certify the maximum levy allowable under 
 27.13  section 126C.13, subdivision 2, in that same year. 
 27.14     Sec. 44.  Minnesota Statutes 1998, section 126C.43, 
 27.15  subdivision 1, is amended to read: 
 27.16     Subdivision 1.  [ALLOCATION OF ASSETS AND LIABILITIES.] 
 27.17  Upon approval of the commissioner, a district may levy is 
 27.18  eligible for state aid in the amount authorized for liabilities 
 27.19  of dissolved districts pursuant to section 123A.67. 
 27.20     Sec. 45.  Minnesota Statutes 1998, section 126C.43, 
 27.21  subdivision 2, is amended to read: 
 27.22     Subd. 2.  [PAYMENT TO REEMPLOYMENT INSURANCE FUND BY STATE 
 27.23  AND POLITICAL SUBDIVISIONS.] Upon approval of the commissioner, 
 27.24  a district may levy is eligible for state aid equal to the 
 27.25  amounts necessary to pay the district's obligations under 
 27.26  section 268.052, subdivision 1, and the amounts necessary to pay 
 27.27  for job placement services offered to employees who may become 
 27.28  eligible for benefits pursuant to section 268.085 for 
 27.29  the previous fiscal year the levy is certified. 
 27.30     Sec. 46.  Minnesota Statutes 1998, section 126C.43, 
 27.31  subdivision 3, is amended to read: 
 27.32     Subd. 3.  [TAX LEVY FOR UNPAID JUDGMENT.] Upon approval of 
 27.33  the commissioner, a district may levy is eligible for state aid 
 27.34  in the amounts necessary to pay the district's obligations under 
 27.35  section 126C.47. 
 27.36     Sec. 47.  Minnesota Statutes 1998, section 126C.43, 
 28.1   subdivision 4, is amended to read: 
 28.2      Subd. 4.  [LEVY LIMITATIONS OF REORGANIZED DISTRICTS 
 28.3   DISTRICT AID.] Upon approval of the commissioner, a district may 
 28.4   levy is eligible for state aid in the amounts authorized by 
 28.5   section 123A.73. 
 28.6      Sec. 48.  Minnesota Statutes 1998, section 126C.43, 
 28.7   subdivision 5, is amended to read: 
 28.8      Subd. 5.  [EXPENSES OF TRANSITION; DISSOLVED DISTRICT.] A 
 28.9   district may levy the amounts is eligible for state aid in the 
 28.10  amount necessary to pay the district's obligations under section 
 28.11  123A.76. 
 28.12     Sec. 49.  Minnesota Statutes 1998, section 126C.43, 
 28.13  subdivision 6, is amended to read: 
 28.14     Subd. 6.  [TEACHER SEVERANCE PAY.] Upon approval of the 
 28.15  commissioner, a district may levy is eligible for state aid for 
 28.16  severance pay required by sections 124D.05, subdivision 3, and 
 28.17  123A.30, subdivision 6. 
 28.18     Sec. 50.  Minnesota Statutes 1998, section 126C.44, is 
 28.19  amended to read: 
 28.20     126C.44 [CRIME-RELATED COSTS LEVY.] 
 28.21     For taxes levied in 1991 and subsequent years, payable in 
 28.22  1992 and subsequent years, each district may make a levy on all 
 28.23  taxable property located within the district for the purposes 
 28.24  specified in this subdivision.  The maximum amount which may be 
 28.25  levied for all costs under this subdivision shall be fiscal 
 28.26  years 2001 and later, a district's crime revenue is equal to 
 28.27  $1.50 multiplied by the population of the school district.  For 
 28.28  purposes of this subdivision, "population" of the school 
 28.29  district means the same as contained in section 275.14.  The 
 28.30  proceeds of the levy state aid must be used for reimbursing the 
 28.31  cities and counties who contract with the district for the 
 28.32  following purposes:  (1) to pay the costs incurred for the 
 28.33  salaries, benefits, and transportation costs of peace officers 
 28.34  and sheriffs for liaison services in the district's middle and 
 28.35  secondary schools; (2) to pay the costs for a drug abuse 
 28.36  prevention program as defined in Minnesota Statutes 1991 
 29.1   Supplement, section 609.101, subdivision 3, paragraph (f), in 
 29.2   the elementary schools; or (3) to pay the costs for a gang 
 29.3   resistance education training curriculum in the middle schools.  
 29.4   The district must initially attempt to contract for these 
 29.5   services with the police department of each city or the 
 29.6   sheriff's department of the county within the district 
 29.7   containing the school receiving the services.  If a local police 
 29.8   department or a county sheriff's department does not wish to 
 29.9   provide the necessary services, the district may contract for 
 29.10  these services with any other police or sheriff's department 
 29.11  located entirely or partially within the school district's 
 29.12  boundaries.  The levy authorized under this subdivision is not 
 29.13  included in determining the school district's levy limitations. 
 29.14     Sec. 51.  Minnesota Statutes 1998, section 126C.45, is 
 29.15  amended to read: 
 29.16     126C.45 [ICE ARENA LEVY.] 
 29.17     (a) Each year, upon approval of the commissioner, an 
 29.18  independent school district operating and maintaining an ice 
 29.19  arena, may levy for is eligible for state aid in an amount equal 
 29.20  to the net operational costs of the ice arena.  The levy may 
 29.21  state aid must not exceed the net actual costs of operation of 
 29.22  the arena for the previous year.  Net actual costs are defined 
 29.23  as operating costs less any operating revenues. 
 29.24     (b) Any district operating and maintaining an ice arena 
 29.25  must demonstrate to the satisfaction of the office of monitoring 
 29.26  in the department that the district will offer equal sports 
 29.27  opportunities for male and female students to use its ice arena, 
 29.28  particularly in areas of access to prime practice time, team 
 29.29  support, and providing junior varsity and younger level teams 
 29.30  for girls' ice sports and ice sports offerings. 
 29.31     Sec. 52.  [127A.485] [ADJUSTED GENERAL EDUCATION TAX BASE.] 
 29.32     Subdivision 1.  [GENERAL EDUCATION TAX BASE.] "General 
 29.33  education tax base" means the net tax capacity of the taxable 
 29.34  property of the district for class 3 property defined according 
 29.35  to section 273.13, subdivision 24, and class 5 property defined 
 29.36  according to section 273.13, subdivision 31. 
 30.1      Subd. 2.  [ADJUSTED GENERAL EDUCATION TAX BASE.] A school 
 30.2   district's adjusted general education tax base equals its 
 30.3   general education tax base computed under subdivision 1 divided 
 30.4   by its sales ratio for those classes of property computed under 
 30.5   section 127A.48. 
 30.6      Sec. 53.  [OPERATING REFERENDUM REVENUE TASK FORCE.] 
 30.7      Subdivision 1.  [ESTABLISHMENT; PURPOSE.] A task force on 
 30.8   elementary and secondary education funding is established to 
 30.9   examine the issues raised by the repeal of the operating 
 30.10  referendum revenue authorized under Minnesota Statutes, section 
 30.11  126C.17.  The task force must evaluate and propose an 
 30.12  alternative source of funding that is both flexible and 
 30.13  equitable. 
 30.14     Subd. 2.  [MEMBERSHIP.] The task force is composed of five 
 30.15  persons appointed by the governor, five persons appointed by the 
 30.16  speaker of the house of representatives, five persons appointed 
 30.17  by the subcommittee on committees of the senate committee on 
 30.18  rules and administration, and one representative from each of 
 30.19  the following organizations:  the Minnesota school boards 
 30.20  association; the association of metropolitan school districts; 
 30.21  the Minnesota rural education association; schools for equity in 
 30.22  education; the Minnesota association of school administrators; 
 30.23  the Minnesota association of school business officials; and 
 30.24  education Minnesota. 
 30.25     Subd. 3.  [DUTIES.] The task force must examine Minnesota's 
 30.26  current referendum revenue and evaluate alternative forms of 
 30.27  discretionary revenue for Minnesota's elementary and secondary 
 30.28  education system.  The task force may utilize staff of the 
 30.29  department of children, families, and learning, as necessary. 
 30.30     Subd. 4.  [REPORT.] The task force must submit a report of 
 30.31  its findings and recommend the proposed alternative to the 
 30.32  education committees of the house and senate by December 15, 
 30.33  2000. 
 30.34     Sec. 54.  [REPEALER.] 
 30.35     Subdivision 1.  [REVENUE FOR FISCAL YEAR 2001.] Minnesota 
 30.36  Statutes 1998, sections 123B.57, subdivisions 6 and 7; 123B.59, 
 31.1   subdivision 5; 123B.64, subdivisions 3 and 4; 124D.135, 
 31.2   subdivisions 3 and 4; 124D.20, subdivisions 5, 6, and 7; 
 31.3   124D.56, subdivisions 2 and 3; 124D.86, subdivision 4; 126C.10, 
 31.4   subdivisions 10, 11, 21, and 22, are repealed for revenue for 
 31.5   fiscal years 2001 and later. 
 31.6      Subd. 2.  [REVENUE FOR FISCAL YEAR 2003.] Minnesota 
 31.7   Statutes 1998, section 126C.17, subdivisions 1, 2, 3, 4, 5, 6, 
 31.8   7, 8, 9, 10, 11, and 12, are repealed for revenue for fiscal 
 31.9   years 2003 and later. 
 31.10     Sec. 55.  [EFFECTIVE DATE.] 
 31.11     Sections 1 to 52 are effective for revenue for fiscal years 
 31.12  2001 and later.