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Minnesota Legislature

Office of the Revisor of Statutes

SF 1999

as introduced - 91st Legislature (2019 - 2020) Posted on 03/05/2019 09:16am

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to education finance; clarifying allowed uses of long-term facilities
maintenance revenue and capital levies; increasing lease levy authority for school
districts that are members of cooperative units; amending Minnesota Statutes 2018,
sections 123B.595, subdivision 3; 126C.40, subdivision 1.

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

Section 1.

Minnesota Statutes 2018, section 123B.595, subdivision 3, is amended to read:


Subd. 3.

Intermediate districts and other cooperative units.

new text begin(a) new text endUpon approval through
the adoption of a resolution by each member district school board of an intermediate district
or other cooperative deleted text beginunitsdeleted text endnew text begin unitnew text end under section 123A.24, subdivision 2, new text beginor a joint powers
district under section 471.59,
new text endand the approval of the commissioner of education, a school
district may include in its authority under this section a proportionate share of the long-term
maintenance costs of the intermediate district deleted text beginordeleted text endnew text begin,new text end cooperative unitnew text begin, or joint powers districtnew text end.
The cooperative unit new text beginor joint powers district new text endmay issue bonds to finance the project costs
or levy for the costsdeleted text begin,deleted text end using long-term maintenance revenue transferred from member districts
to make debt service payments or pay project costsnew text begin or, for leased facilities, pay the portion
of lease costs attributable to the amortized cost of long-term facilities maintenance projects
completed by the landlord
new text end. Authority under this subdivision is in addition to the authority
for individual district projects under subdivision 1.

new text begin (b) The resolution adopted under paragraph (a) may specify which member districts will
share the project costs under this subdivision, except that debt service payments for bonds
issued by a cooperative unit or joint powers district to finance long-term maintenance project
costs must be the responsibility of all member districts.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for revenue in fiscal year 2020 and later.
new text end

Sec. 2.

Minnesota Statutes 2018, section 126C.40, subdivision 1, is amended to read:


Subdivision 1.

To lease building or land.

(a) When an independent or a special school
district or a group of independent or special school districts finds it economically
advantageous to rent or lease a building or land for any instructional purposes or for school
storage or furniture repair, and it determines that the operating capital revenue authorized
under section 126C.10, subdivision 13, is insufficient for this purpose, it may apply to the
commissioner for permission to make an additional capital expenditure levy for this purpose.
An application for permission to levy under this subdivision must contain financial
justification for the proposed levy, the terms and conditions of the proposed lease, and a
description of the space to be leased and its proposed use.

(b) The criteria for approval of applications to levy under this subdivision must include:
the reasonableness of the price, the appropriateness of the space to the proposed activity,
the feasibility of transporting pupils to the leased building or land, conformity of the lease
to the laws and rules of the state of Minnesota, and the appropriateness of the proposed
lease to the space needs and the financial condition of the district. The commissioner must
not authorize a levy under this subdivision in an amount greater than the cost to the district
of renting or leasing a building or land for approved purposes. The proceeds of this levy
must not be used for custodial or other maintenance services. A district may not levy under
this subdivision for the purpose of leasing or renting a district-owned building or site to
itself.

(c) For agreements finalized after July 1, 1997, a district may not levy under this
subdivision for the purpose of leasing: (1) a newly constructed building used primarily for
regular kindergarten, elementary, or secondary instruction; or (2) a newly constructed
building addition or additions used primarily for regular kindergarten, elementary, or
secondary instruction that contains more than 20 percent of the square footage of the
previously existing building.

(d) Notwithstanding paragraph (b), a district may levy under this subdivision for the
purpose of leasing or renting a district-owned building or site to itself only if the amount is
needed by the district to make payments required by a lease purchase agreement, installment
purchase agreement, or other deferred payments agreement authorized by law, and the levy
meets the requirements of paragraph (c). A levy authorized for a district by the commissioner
under this paragraph may be in the amount needed by the district to make payments required
by a lease purchase agreement, installment purchase agreement, or other deferred payments
agreement authorized by law, provided that any agreement include a provision giving the
school districts the right to terminate the agreement annually without penalty.

(e) The total levy under this subdivision for a district for any year must not exceed $212
times the adjusted pupil units for the fiscal year to which the levy is attributable.

(f) For agreements for which a review and comment have been submitted to the
Department of Education after April 1, 1998, the term "instructional purpose" as used in
this subdivision excludes expenditures on stadiums.

(g) The commissioner of education may authorize a school district to exceed the limit
in paragraph (e) if the school district petitions the commissioner for approval. The
commissioner shall grant approval to a school district to exceed the limit in paragraph (e)
for not more than five years if the district meets the following criteria:

(1) the school district has been experiencing pupil enrollment growth in the preceding
five years;

(2) the purpose of the increased levy is in the long-term public interest;

(3) the purpose of the increased levy promotes colocation of government services; and

(4) the purpose of the increased levy is in the long-term interest of the district by avoiding
over construction of school facilities.

(h) A school district that is a member of an intermediate school districtnew text begin or other
cooperative unit under section 123A.24, subdivision 2, or a joint powers district under
section 471.59
new text end may include in its authority under this section the costs associated with leases
of administrative and classroom space for deleted text beginintermediate school districtdeleted text end programsnew text begin of the
intermediate school district or other cooperative unit under section 123A.24, subdivision
2, or joint powers district under section 471.59
new text end. This authority must not exceed $65 times
the adjusted pupil units of the member districts. This authority is in addition to any other
authority authorized under this section.new text begin The intermediate school district, other cooperative
unit, or joint powers district may specify which member districts will levy for lease costs
under this paragraph.
new text end

(i) In addition to the allowable capital levies in paragraph (a), for taxes payable in 2012
to 2023, a district that is a member of the "Technology and Information Education Systems"
data processing joint board, that finds it economically advantageous to enter into a lease
agreement to finance improvements to a building and land for a group of school districts
or special school districts for staff development purposes, may levy for its portion of lease
costs attributed to the district within the total levy limit in paragraph (e). The total levy
authority under this paragraph shall not exceed $632,000.

(j) Notwithstanding paragraph (a), a district may levy under this subdivision for the
purpose of leasing administrative space if the district can demonstrate to the satisfaction of
the commissioner that the lease cost for the administrative space is no greater than the lease
cost for instructional space that the district would otherwise lease. The commissioner must
deny this levy authority unless the district passes a resolution stating its intent to lease
instructional space under this section if the commissioner does not grant authority under
this paragraph. The resolution must also certify that the lease cost for administrative space
under this paragraph is no greater than the lease cost for the district's proposed instructional
lease.

new text begin (k) Notwithstanding paragraph (a), a district may levy under this subdivision for the
district's proportionate share of deferred maintenance expenditures for a district-owned
building or site leased to a cooperative unit under section 123A.24, subdivision 2, or a joint
powers district under section 471.59 for any instructional purposes or for school storage.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for revenue in fiscal year 2020 and later.
new text end