SF 576

as introduced - 89th Legislature (2015 - 2016) Posted on 02/13/2015 09:29am

A bill for an act
relating to property taxation; providing that bonded debt authorizations approved
after June 30, 2015, be levied against referendum market value; amending
Minnesota Statutes 2014, sections 123B.53, subdivisions 1, 4, 5, 6, by adding
subdivisions; 123B.55; 275.61.

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

Section 1.

Minnesota Statutes 2014, section 123B.53, subdivision 1, is amended to read:

Subdivision 1.

Definitions.

(a) For purposes of this section, the new text begin total new text end eligible debt
service revenue of a district is defined as follows:

(1) the amount needed to produce between five and six percent in excess of the
amount needed to meet when due the principal and interest payments on the obligations
of the district for eligible projects according to subdivision 2, including the amounts
necessary for repayment of energy loans according to section 216C.37 or sections 298.292
to 298.298, debt service loans and capital loans, lease purchase payments under section
126C.40, subdivision 2, alternative facilities levies under section 123B.59, subdivision
5, paragraph (a), minus

(2) the amount of debt service excess levy reduction for that school year calculated
according to the procedure established by the commissioner.

(b) The obligations in this paragraph are excluded from eligible debt service revenue:

(1) obligations under section 123B.61;

(2) the part of debt service principal and interest paid from the taconite environmental
protection fund or Douglas J. Johnson economic protection trust, excluding the portion of
taconite payments from the Iron Range school consolidation and cooperatively operated
school account under section 298.28, subdivision 7a;

(3) obligations issued under Laws 1991, chapter 265, article 5, section 18, as
amended by Laws 1992, chapter 499, article 5, section 24;

(4) obligations under section 123B.62; and

(5) obligations equalized under section 123B.535.

(c) For purposes of this section, if a preexisting school district reorganized under
sections 123A.35 to 123A.43, 123A.46, and 123A.48 is solely responsible for retirement
of the preexisting district's bonded indebtedness, capital loans or debt service loans, debt
service equalization aid must be computed separately for each of the preexisting districts.

(d) For purposes of this section, the adjusted net tax capacity determined according
to sections 127A.48 and 273.1325 shall be adjusted to include the tax capacity of property
generally exempted from ad valorem taxes under section 272.02, subdivision 64.

new text begin (e) For purposes of this section, the "net tax capacity eligible debt service revenue"
of a district is defined as the total eligible debt service revenue of a district excluding any
amount needed to meet the principal and interest payments obligations of the district
for projects approved after June 30, 2015.
new text end

new text begin (f) For purposes of this section, "referendum market value eligible debt service
revenue" is the difference between total eligible debt service revenue and net tax capacity
eligible debt service revenue.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with taxes payable in 2016.
new text end

Sec. 2.

Minnesota Statutes 2014, section 123B.53, subdivision 4, is amended to read:

Subd. 4.

new text begin Net tax capacity new text end debt service equalization revenue.

(a) The new text begin net tax
capacity new text end debt service equalization revenue of a district equals the sum of the first tier new text begin net
tax capacity new text end debt service equalization revenue and the second tier new text begin net tax capacity new text end debt
service equalization revenue.

(b) The first tier new text begin net tax capacity new text end debt service equalization revenue of a district equals
the greater of zero or the eligible new text begin net tax capacity new text end debt service revenue minus the amount
raised by a levy of 15.74 percent times the adjusted net tax capacity of the district minus
the second tier new text begin net tax capacity new text end debt service equalization revenue of the district.

(c) The second tier new text begin net tax capacity new text end debt service equalization revenue of a district
equals the greater of zero or the eligible new text begin net tax capacity new text end debt service revenue, excluding
alternative facilities levies under section 123B.59, subdivision 5, minus the amount raised
by a levy of 26.24 percent times the adjusted net tax capacity of the district.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with taxes payable in 2016.
new text end

Sec. 3.

Minnesota Statutes 2014, section 123B.53, subdivision 5, is amended to read:

Subd. 5.

Equalized new text begin net tax capacity new text end debt service levy.

(a) The equalized new text begin net tax
capacity new text end debt service levy of a district equals the sum of the first tier equalized new text begin net tax
capacity new text end debt service levy and the second tier equalized new text begin net tax capacity new text end debt service levy.

(b) A district's first tier equalized new text begin net tax capacity new text end debt service levy equals the
district's first tier new text begin net tax capacity new text end debt service equalization revenue times the lesser of
one or the ratio of:

(1) the quotient derived by dividing the adjusted net tax capacity of the district for
the year before the year the levy is certified by the adjusted pupil units in the district for
the school year ending in the year prior to the year the levy is certified; to

(2) $3,400 in fiscal year 2016 and $4,430 in fiscal year 2017 and later.

(c) A district's second tier equalized new text begin net tax capacity new text end debt service levy equals the
district's second tier new text begin net tax capacity new text end debt service equalization revenue times the lesser of
one or the ratio of:

(1) the quotient derived by dividing the adjusted net tax capacity of the district for
the year before the year the levy is certified by the adjusted pupil units in the district for
the school year ending in the year prior to the year the levy is certified; to

(2) $8,000.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with taxes payable in 2016.
new text end

Sec. 4.

Minnesota Statutes 2014, section 123B.53, subdivision 6, is amended to read:

Subd. 6.

new text begin Net tax capacity new text end debt service equalization aid.

(a) A district's new text begin net tax
capacity new text end debt service equalization aid is the sum of the district's first tier new text begin net tax capacity
new text end debt service equalization aid and the district's second tier new text begin net tax capacity new text end debt service
equalization aid.

(b) A district's first tier new text begin net tax capacity new text end debt service equalization aid equals the
difference between the district's first tier new text begin net tax capacity new text end debt service equalization revenue
and the district's first tier equalized new text begin net tax capacity new text end debt service levy.

(c) A district's second tier new text begin net tax capacity new text end debt service equalization aid equals the
difference between the district's second tier new text begin net tax capacity new text end debt service equalization
revenue and the district's second tier equalized new text begin net tax capacity new text end debt service levy.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with taxes payable in 2016.
new text end

Sec. 5.

Minnesota Statutes 2014, section 123B.53, is amended by adding a subdivision
to read:

new text begin Subd. 8. new text end

new text begin Initial referendum market value debt service equalization revenue. new text end

new text begin (a)
The initial referendum market value debt service equalization revenue of a district equals
the sum of the first tier referendum market value debt service equalization revenue and the
second tier referendum market value debt service equalization revenue.
new text end

new text begin (b) The first tier referendum market value debt service equalization revenue of a
district equals the greater of zero or the total eligible debt service revenue minus the amount
raised by a levy of 0.2273 percent times the referendum market value of the district minus
the second tier referendum market value debt service equalization revenue of the district.
new text end

new text begin (c) The second tier referendum market value debt service equalization revenue of
a district equals the greater of zero or the total eligible debt service revenue, excluding
alternative facilities levies under section 123B.59, subdivision 5, minus the amount raised
by a levy of 0.3790 percent times the referendum market value of the district.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with taxes payable in 2016.
new text end

Sec. 6.

Minnesota Statutes 2014, section 123B.53, is amended by adding a subdivision
to read:

new text begin Subd. 9. new text end

new text begin Equalized initial referendum market value debt service levy. new text end

new text begin (a) The
equalized initial referendum market value debt service levy of a district equals the sum
of the first tier equalized referendum market value debt service levy and the second tier
equalized referendum market value debt service levy.
new text end

new text begin (b) A district's first tier equalized referendum market value debt service levy equals
the district's first tier referendum market value debt service equalization revenue times
the lesser of one or the ratio of:
new text end

new text begin (1) the quotient derived by dividing the referendum market value of the district for
the year before the year the levy is certified by the adjusted pupil units in the district for
the school year ending in the year prior to the year the levy is certified; to
new text end

new text begin (2) $235,416.
new text end

new text begin (c) A district's second tier equalized debt service levy equals the district's second tier
debt service equalization revenue times the lesser of one or the ratio of:
new text end

new text begin (1) the quotient derived by dividing the referendum market value of the district for
the year before the year the levy is certified by the adjusted pupil units in the district for
the school year ending in the year prior to the year the levy is certified; to
new text end

new text begin (2) $553,921.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with taxes payable in 2016.
new text end

Sec. 7.

Minnesota Statutes 2014, section 123B.53, is amended by adding a subdivision
to read:

new text begin Subd. 10. new text end

new text begin Initial referendum market value debt service equalization aid. new text end

new text begin (a) A
district's initial referendum market value debt service equalization aid is equal to the sum
of the district's first tier referendum market value debt service equalization aid and the
district's second tier referendum market value debt service equalization aid.
new text end

new text begin (b) A district's first tier referendum market value debt service equalization aid
equals the difference between the district's first tier referendum market value debt service
equalization revenue and the district's first tier equalized referendum market value debt
service levy.
new text end

new text begin (c) A district's second tier referendum market value debt service equalization aid
equals the difference between the district's second tier referendum market value debt
service equalization revenue and the district's second tier equalized debt service levy.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with taxes payable in 2016.
new text end

Sec. 8.

Minnesota Statutes 2014, section 123B.53, is amended by adding a subdivision
to read:

new text begin Subd. 11. new text end

new text begin Actual referendum market value aid. new text end

new text begin A district's actual referendum
market value debt service aid equals the district's initial referendum market value debt
service aid less its net tax capacity debt service equalization aid, provided that the aid may
not be greater than the district's referendum market value eligible debt service revenue,
nor may it be less than zero.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with taxes payable in 2016.
new text end

Sec. 9.

Minnesota Statutes 2014, section 123B.55, is amended to read:

123B.55 DEBT SERVICE LEVY.

new text begin (a) new text end A district may levy the amounts necessary to make payments for bonds issued
and for interest on them, including the bonds and interest on them, issued as authorized by
Minnesota Statutes 1974, section 275.125, subdivision 3, clause (7)(C); and the amounts
necessary for repayment of debt service loans and capital loans, minus the amount of debt
service equalization revenue of the district.

new text begin (b) Levies under this section for bonds authorized prior to July 1, 2015, must
be levied against the net tax capacity of the district, as defined under section 273.13,
subdivision 21b. Levies under this section for bonds authorized after June 30, 2015, must
be levied against the referendum market value of the district, as defined under section
126C.01, subdivision 3.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with taxes payable in 2016.
new text end

Sec. 10.

Minnesota Statutes 2014, section 275.61, is amended to read:

275.61 VOTER-APPROVED LEVY; MARKET VALUE.

Subdivision 1.

Market value.

(a) For local governmental subdivisions other than
school districts, any levy approved by the voters at a general or special election shall be
levied against the referendum market value of all taxable property within the governmental
subdivision, as defined in section 126C.01, subdivision 3. Any levy amount subject to
the requirements of this section shall be certified separately to the county auditor under
section 275.07.

(b) The ballot shall state the maximum amount of the increased levy as a percentage
of market value and the amount that will be raised by the new referendum tax rate in the
first year it is to be levied.

(c) This subdivision does not apply to tax levies for the payment of debt obligations
that are approved by the voters after June 30, 2008 new text begin , and before July 1, 2015 new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with taxes payable in 2016.
new text end