1997 Minnesota Statutes

     124.42 Debt service loans. 

    Subdivision 1.    Qualification; application; award; 
 interest.  Any school district in which the required levy for 
 debt service in any year will exceed its maximum effort debt 
 service levy by ten percent or by $5,000, whichever is less, is 
 qualified for a debt service loan hereunder in an amount not 
 exceeding the amount applied for, and not exceeding one percent 
 of the net debt of the district, and not exceeding the 
 difference between the required and the maximum effort debt 
 service levy in that year.  Applications shall be filed with the 
 commissioner in each calendar year up to and including July 1.  
 The commissioner shall determine whether the applicant is 
 entitled to a loan and the amount thereof, and on or before 
 October 1 shall certify to each applicant district the amount 
 granted and its due date.  The commissioner shall notify the 
 county auditor of each county in which the district is located 
 that the amount certified is available and appropriated for 
 payment of principal and interest on its outstanding bonds, and 
 the auditors shall reduce by that amount the taxes otherwise 
 leviable as the district's debt service levy on the tax rolls 
 for that year.  Each debt service loan shall bear interest from 
 its date at a rate equal to the average annual rate payable on 
 Minnesota state school loan bonds most recently issued prior to 
 the disbursement of the loan to the district, but in no event 
 less than 3-1/2 percent per annum on the principal amount from 
 time to time remaining unpaid, payable on December 15 of the 
 year following that in which the loan is received and annually 
 thereafter. 

    Subd. 2.    Note.  Each debt service loan shall be 
 evidenced by a note which shall be executed on behalf of the 
 district by the signatures of its chair or vice-chair and the 
 school district clerk, shall be dated November 1 of the year in 
 which executed, and shall state its principal amount, interest 
 rate, and that it is payable at the commissioner's office.  It 
 shall have printed thereon, or the commissioner shall attach 
 thereto, a grill for entry of the date and amount of each 
 payment and allocations of each payment to accrued interest or 
 principal, and a certificate to be executed by the county 
 auditor of each county in which any portion of the school 
 district is situated, prior to the delivery of the note, stating 
 that the county auditor has entered the debt service loan 
 evidenced thereby in the auditor's bond register.  The notes 
 shall be delivered to the commissioner not later than November 
 15 of the year in which executed.  The commissioner shall cause 
 a record to be made and preserved showing the obligor district 
 and the date and principal amount of each note.  

    Subd. 3.  The commissioner shall issue to each district 
 whose note has been so received a warrant on the debt service 
 loan account of the maximum effort school loan fund, payable on 
 presentation to the state treasurer out of any money in such 
 account.  The warrant shall be issued by the commissioner in 
 sufficient time to coincide with the next date on which the 
 district is obligated to make principal or interest payments on 
 its bonded debt in the ensuing year.  Interest shall accrue from 
 the date such warrant is issued.  The proceeds thereof shall be 
 used by the district to pay principal or interest on its bonded 
 debt falling due in the ensuing year.  

    Subd. 4.  Each district receiving a debt service loan shall 
 levy for debt service in that year and each year thereafter, 
 until all its debts to the fund are paid, (a) the amount of its 
 maximum effort debt service levy, or (b) the amount of its 
 required debt service levy less the amount of any debt service 
 loan in that year, whichever is greater.  The district shall 
 remit payments to the commissioner according to section 124.45.  
 On or before September 30 in each year the commissioner shall 
 notify the county auditor of each county containing taxable 
 property situated within the school district of the amount of 
 the maximum effort debt service levy of the district for that 
 year, and said 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.  

    HIST: Ex1959 c 27 s 7; 1961 c 752 s 3,4; 1965 c 875 s 4,5; 
 1969 c 1056 s 3,4; 1973 c 492 s 14; 1975 c 432 s 55-57; 1981 c 
 358 art 9 s 5,6; 1986 c 444; 1989 c 271 s 29; 1Sp1989 c 1 art 9 
 s 2,3; 1Sp1997 c 4 art 4 s 12