SF 2161

as introduced - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to education finance; allowing school
districts flexibility to transfer unused debt service
revenue for general purposes; amending Minnesota
Statutes 2004, section 475.61, subdivision 4.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2004, section 475.61,
subdivision 4, is amended to read:

Subd. 4.

Surplus funds.

(a) All such taxes shall be
collected and remitted to the municipality by the county
treasurer as other taxes are collected and remitted, and shall
be used only for payment of the obligations on account of which
levied or to repay advances from other funds used for such
payments, except that any surplus remaining in the debt service
fund when the obligations and interest thereon are paid may be
appropriated to any other general purpose by the municipality.
However, new text begin for obligations authorized before July 1, 2005, new text end the
amount of any surplus remaining in the debt service fund of a
school district when the obligations and interest thereon are
paid shall be used to reduce the general fund deleted text begin levy deleted text end new text begin levies
new text end authorized pursuant to chapters 122A, 123A, 123B, 124D, and 126C
and the state aids authorized pursuant to chapters 122A, 123A,
123B, 124D, 125A, 126C, and 127A. new text begin For obligations authorized on
July 1, 2005, or thereafter, the amount of any surplus remaining
in the debt service fund of a school district when the
obligations and interest thereon are paid may be appropriated to
any other general purpose by the school district without any
reduction in state aid or levies or may be used to reduce the
general fund levies authorized under chapters 122A, 123A, 123B,
124D, and 126C, and the state aids authorized under chapters
122A, 123A, 123B, 124D, 125A, 126C, and 127A.
new text end

(b) If the district qualified for second tier debt service
equalization aid in the last year that it qualified for debt
service equalization aid, the reduction to state aids equals the
lesser of (1) the amount of the surplus times the ratio of the
district's second tier debt service equalization aid to the
district's second tier debt service equalization revenue for the
last year that the district qualified for debt service
equalization aid; or (2) the district's cumulative amount of
debt service equalization aid.

(c) If the district did not qualify for second tier debt
service equalization aid in the last year that it qualified for
debt service equalization aid, the reduction to state aids
equals the lesser of (1) the amount of the surplus times the
ratio of the district's debt service equalization aid to the
district's debt service equalization revenue for the last year
that the district qualified for debt service equalization aid;
or (2) the district's cumulative amount of debt service
equalization aid.

(d) The reduction to the general fund deleted text begin levy deleted text end new text begin levies new text end equals
the total amount of the surplus minus the reduction to state
aids.