1.1 	A bill for an act
1.2 	relating to education finance; providing that
1.3 	agricultural land is not subject to certain school
1.4 	district debt service levies; amending Minnesota
1.5 	Statutes 2004, sections 123B.53, subdivision 5;
1.6 	126C.01, subdivision 2.
1.7 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.8 	Section 1. Minnesota Statutes 2004, section 123B.53,
1.9 	subdivision 5, is amended to read:
1.10 		Subd. 5.Equalized debt service levy.  (a) The equalized
1.11 	debt service levy of a district equals the sum of the first tier
1.12 	equalized debt service levy and the second tier equalized debt
1.13 	service levy.
1.14 	(b) A district's first tier equalized debt service levy
1.15 	equals the district's first tier debt service equalization
1.16 	revenue times the lesser of one or the ratio of:
1.17 	(1) the quotient derived by dividing the adjusted net tax
1.18 	capacity of the district as defined in section 126C.01,
1.19 	subdivision 2, paragraph (b),for the year before the year the
1.20 	levy is certified by the adjusted pupil units in the district
1.21 	for the school year ending in the year prior to the year the
1.22 	levy is certified; to
1.23 	(2) $3,200.
1.24 	(c) A district's second tier equalized debt service levy
1.25 	equals the district's second tier debt service equalization
1.26 	revenue times the lesser of one or the ratio of:
2.1 	(1) the quotient derived by dividing the adjusted net tax
2.2 	capacity of the district for the year before the year the levy
2.3 	is certified by the adjusted pupil units in the district for the
2.4 	school year ending in the year prior to the year the levy is
2.5 	certified; to
2.6 	(2) $8,000.

2.7 	Sec. 2. Minnesota Statutes 2004, section 126C.01,
2.8 	subdivision 2, is amended to read:
2.9 		Subd. 2.Adjusted net tax capacity. (a) Except as
2.10 	provided in paragraph (b),"adjusted net tax capacity" means the
2.11 	net tax capacity of the taxable property of the district as
2.12 	adjusted by the commissioner of revenue under section 127A.48.
2.13 	The adjusted net tax capacity for any given calendar year must
2.14 	be used to compute levy limitations for levies certified in the
2.15 	succeeding calendar year and aid for the school year beginning
2.16 	in the second succeeding calendar year.
2.17 	(b) For purposes of the equalized debt service levy under
2.18 	section 123B.53, subdivision 5, "adjusted net tax capacity" is
2.19 	the value described in paragraph (a), reduced by the value of
2.20 	agricultural land determined under that paragraph.

2.21 	Sec. 3. EFFECTIVE DATE.
 2.22 	Sections 1 and 2 are effective for taxes levied in 2005,
2.23 	payable in 2006, and thereafter, related to referenda conducted
2.24 	after June 30, 2005.