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124D.16 SCHOOL READINESS AID.
    Subdivision 1.[Repealed, 1Sp2005 c 5 art 7 s 21]
    Subd. 2. Amount of aid. (a) A district is eligible to receive school readiness aid for
eligible prekindergarten pupils enrolled in a school readiness program under section 124D.15
if the biennial plan required by section 124D.15, subdivision 3a, has been approved by the
commissioner.
(b) For fiscal year 2002 and thereafter, a district must receive school readiness aid equal to:
(1) the number of four-year-old children in the district on October 1 for the previous school
year times the ratio of 50 percent of the total school readiness aid for that year to the total number
of four-year-old children reported to the commissioner for the previous school year; plus
(2) the number of pupils enrolled in the school district from families eligible for the free
or reduced school lunch program for the previous school year times the ratio of 50 percent of
the total school readiness aid for that year to the total number of pupils in the state from families
eligible for the free or reduced school lunch program for the previous school year.
    Subd. 3. Use of aid. School readiness aid shall be used only to provide a school readiness
program and may be used to provide transportation. Not more than five percent of program
revenue, as defined in subdivision 5, may be used for the cost of administering the program. Aid
must be used to supplement and not supplant local, state, and federal funding. Aid may not be
used for instruction and services required under sections 125A.03 to 125A.24 and 125A.65. Aid
may not be used to purchase land or construct buildings, but may be used to lease or renovate
existing buildings.
    Subd. 4.[Repealed, 1Sp2005 c 5 art 7 s 21]
    Subd. 5. Reserve account. School readiness revenue, which includes aids, fees, grants, and
all other revenues received by the district school readiness programs, must be maintained in a
reserve account within the community service fund.
    Subd. 6. Reserve account limit. (a) Under this section, the average balance, during the
most recent three-year period, in a district's school readiness reserve account on June 30 of
each year, adjusted for any prior reductions under this subdivision, must not be greater than 25
percent of the district's school readiness annual revenue for the prior year, excluding adjustments
under this subdivision.
(b) If a district's adjusted average school readiness reserve over the three-year period is in
excess of the limit under paragraph (a), the district's current year school readiness state aid must
be reduced by the lesser of the excess reserve amount or the current year aid.
(c) Notwithstanding paragraph (a), for fiscal year 2003, the excess reserve amount shall be
computed using the balance in a district's school readiness reserve account on June 30, 2002. For
fiscal year 2004, the excess reserve amount shall be computed using the adjusted average balance
in a district's school readiness reserve account on June 30, 2002, and June 30, 2003.
    Subd. 7. Waiver. If a district anticipates that the reserve account may exceed the 25 percent
limit established under subdivision 6 because of extenuating circumstances, prior approval to
exceed the limit must be obtained in writing from the commissioner.
History: 1991 c 265 art 7 s 13; 1992 c 363 art 2 s 5; 1992 c 499 art 7 s 2; 1993 c 224 art 4
s 22,23; 1994 c 483 s 1; 1Sp1995 c 3 art 16 s 13; 1997 c 162 art 4 s 59,60; 1998 c 397 art 3 s
74,75,103; art 11 s 3; 1999 c 205 art 1 s 70; 2000 c 489 art 1 s 8; 1Sp2001 c 3 art 1 s 10-13;
1Sp2003 c 9 art 7 s 9,10; 1Sp2005 c 5 art 7 s 13,14