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HF 782

as introduced - 87th Legislature (2011 - 2012) Posted on 03/03/2011 10:38am

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

Bill Text Versions

Engrossments
Introduction Posted on 03/03/2011

Current Version - as introduced

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A bill for an act
relating to education finance; authorizing the early repayment of maximum effort
capital loans; amending Minnesota Statutes 2010, section 126C.69, subdivisions
12, 13.

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

Section 1.

Minnesota Statutes 2010, section 126C.69, subdivision 12, is amended to
read:


Subd. 12.

Contractnew text begin; early repayment authorizednew text end.

(a) Each capital loan must be
evidenced by a contract between the district and the state acting through the commissioner.
The contract must obligate the state to reimburse the district, from the maximum effort
school loan fund, for eligible capital expenses for construction of the facility for which the
loan is granted, an amount computed as provided in subdivision 9. The commissioner
must receive from the district a certified resolution of the board estimating the costs of
construction and reciting that contracts for construction of the facilities for which the loan
is granted have been awarded, that bonds of the district have been issued and sold in the
amount necessary to pay all estimated costs of construction in excess of the amount of
the loan, and that all work, when completed, meets or exceeds standards established in
the State Building Code. The contract must obligate the district to repay the loan out of
the excesses of its maximum effort debt service levy over its required debt service levy,
including interest at a rate equal to the weighted average annual rate payable on Minnesota
state school loan bonds issued or reissued for the project.

(b) The district must each year, as long as it is indebted to the state, levy for debt
service (i) the amount of its maximum effort debt service levy or (ii) the amount of its
required debt service levy, whichever is greater, except as the required debt service levy
may be reduced by a loan under section 126C.68. new text beginA school district may satisfy its loan
obligations and make an early repayment of principal according to subdivision 13.
new text endThe
district shall remit payments to the commissioner according to section 126C.71.

(c) The commissioner shall supervise the collection of outstanding accounts due the
fund and may, by notice to the proper county auditor, require the maximum levy to be
made as required in this subdivision. Interest on capital loans must be paid on December
15 of the year after the year the loan is granted and annually in later years. By September
30, the commissioner shall notify the county auditor of each county containing taxable
property situated within the district of the amount of the maximum effort debt service
levy of the district for that year. The county auditor or auditors shall extend upon the
tax rolls an ad valorem tax upon all taxable property within the district in the aggregate
amount so certified.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2011.
new text end

Sec. 2.

Minnesota Statutes 2010, section 126C.69, subdivision 13, is amended to read:


Subd. 13.

Loan forgiveness.

new text begin (a) A school district may on July 1 of any year repay
the full outstanding principal on its capital loan and the liability of the district on the loan
is satisfied and discharged and interest on the loan ceases.
new text end

new text begin (b) new text endIf any capital loan is not paid within 50 years after it is granted from maximum
effort debt service levies in excess of required debt service levies, the liability of the
district on the loan is satisfied and discharged and interest on the loan ceases.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2011.
new text end