1997 Minnesota Statutes

     124.95 Debt service equalization program. 

    Subdivision 1.    Definitions.  (a) For purposes of this 
 section, the 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 124.91, subdivisions 2 and 3, alternative 
 facilities levies under section 124.239, subdivision 5, 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 124.2445; 

    (2) the part of debt service principal and interest paid 
 from the taconite environmental protection fund or northeast 
 Minnesota economic protection trust; 

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

    (4) obligations under section 124.2455. 

    (c) For purposes of this section, if a preexisting school 
 district reorganized under section 122.22, 122.23, or 122.241 to 
 122.248 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 school districts. 

    Subd. 2.    Eligibility.  (a) The following portions of 
 a district's debt service levy qualify for debt service 
 equalization: 

    (1) debt service for repayment of principal and interest on 
 bonds issued before July 2, 1992; 

    (2) debt service for bonds refinanced after July 1, 1992, 
 if the bond schedule has been approved by the commissioner and, 
 if necessary, adjusted to reflect a 20-year maturity schedule; 
 and 

    (3) debt service for bonds issued after July 1, 1992, for 
 construction projects that have received a positive review and 
 comment according to section 121.15, if the commissioner has 
 determined that the district has met the criteria under section 
 124.431, subdivision 2, and if the bond schedule has been 
 approved by the commissioner and, if necessary, adjusted to 
 reflect a 20-year maturity schedule.  

    (b) The criterion in section 124.431, subdivision 2, 
 paragraph (a), clause (2), shall be considered to have been met 
 if the district in the fiscal year in which the bonds are 
 authorized at an election conducted under chapter 475: 

    (i) if grades 9 through 12 are to be served by the 
 facility, and an average of at least 66 pupils per grade in 
 these grades are served; or 

    (ii) is eligible for elementary or secondary sparsity 
 revenue. 

    (c) The criterion in section 124.431, subdivision 2, 
 paragraph (a), clause (2), shall also be considered to have been 
 met if the construction project under review serves students in 
 kindergarten to grade 8.  Only the debt service levy for that 
 portion of the facility serving students in prekindergarten to 
 grade 8, as determined by the commissioner, shall be eligible 
 for debt service equalization under this paragraph. 

    (d) The criterion described in section 124.431, subdivision 
 2, paragraph (a), clause (9), does not apply to bonds authorized 
 by elections held before July 1, 1992. 

    (e) For the purpose of this subdivision the department 
 shall determine the eligibility for sparsity at the location of 
 the new facility, or the site of the new facility closest to the 
 nearest operating school if there is more than one new facility. 

    (f) Notwithstanding paragraphs (a) to (e), debt service for 
 repayment of principal and interest on bonds issued after July 
 1, 1997, does not qualify for debt service equalization aid 
 unless the primary purpose of the facility is to serve students 
 in kindergarten through grade 12. 

    Subd. 2a.    Notification.  A district eligible for debt 
 service equalization revenue under subdivision 2 must notify the 
 commissioner of the amount of its intended debt service revenue 
 calculated under subdivision 1 for all bonds sold prior to the 
 notification by July 1 of the calendar year the levy is 
 certified. 

    Subd. 3.    Debt service equalization revenue.  (a) For 
 fiscal years 1995 and later, the debt service equalization 
 revenue of a district equals the eligible debt service revenue 
 minus the amount raised by a levy of ten percent times the 
 adjusted net tax capacity of the district. 

    (b) For fiscal year 1993, debt service equalization revenue 
 equals one-third of the amount calculated in paragraph (a). 

    (c) For fiscal year 1994, debt service equalization revenue 
 equals two-thirds of the amount calculated in paragraph (a). 

    Subd. 4.    Equalized debt service levy.  To obtain debt 
 service equalization revenue, a district must levy an amount not 
 to exceed the district's 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 actual pupil units in the district for the 
 school year ending in the year prior to the year the levy is 
 certified; to 

    (2) $4,707.50. 

    Subd. 5.    Debt service equalization aid.  A district's 
 debt service equalization aid is the difference between the debt 
 service equalization revenue and the equalized debt service levy.
 If the amount of debt service equalization aid actually 
 appropriated for the fiscal year in which this calculation is 
 made is insufficient to fully fund debt service equalization 
 aid, the commissioner shall prorate the amount of aid across all 
 eligible districts. 

    Subd. 6.    Debt service equalization aid payment 
 schedule.  Debt service equalization aid must be paid as 
 follows:  30 percent before September 15, 30 percent before 
 December 15, 25 percent before March 15, and a final payment of 
 15 percent by July 15 of the subsequent fiscal year. 

    HIST: 1991 c 265 art 5 s 8; 1992 c 499 art 5 s 14-19; 1993 c 
 224 art 5 s 31-34; 1994 c 647 art 5 s 14,15; 1Sp1995 c 3 art 5 s 
 10-12; 1996 c 412 art 5 s 7; 1Sp1997 c 4 art 4 s 20 

*   NOTE:  The amendment to subdivision 2 by Laws 1997, First 
*Special Session chapter 4, article 4, section 20, is effective 
*for bonds outstanding on July 1, 1997, that meet the criteria, 
*and is effective for revenue for fiscal year 1999.  Laws 1997, 
*First Special Session chapter 4, article 4, section 37.