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SF437 (Legislative Session 94 (2025-2026))

Natural disaster debt service equalization aid program broadening to assist school district with a high percentage of property excluded from the tax rolls

Related bill: HF535

AI Generated Summary

SF No. 437 is a bill aimed at helping school districts in Minnesota that have faced significant natural disasters or have a large percentage of property not included in their tax base. The bill proposes modifications to the current natural disaster debt service equalization aid program to include:

  1. Eligibility for districts affected by a natural disaster since January 1, 2005, where damages to schools are $500,000 or more and not covered by insurance or FEMA.
  2. Additional eligibility for districts where at least 30% of their property value is exempt from taxation.
  3. Guidance on how disaster-related debt service revenue, defined as an amount above what is necessary to meet debt obligations, is calculated and utilized.
  4. Requirements for districts to notify the commissioner about their intended use of the aid by July 1 of the year the tax levy is certified.
  5. Details on how the aid will be calculated, putting a levy limit based on the district's net tax capacity and providing guidelines for equalizing the levy across districts.

The aim is to ensure that school districts hit by disasters can maintain or rebuild necessary facilities without an undue financial burden on their local tax base.

Bill text versions

Actions

DateChamberWhereTypeNameCommittee Name
January 20, 2025SenateFloorActionIntroduction and first reading
January 20, 2025SenateFloorActionReferred toEducation Finance

Citations

 
[
  {
    "analysis": {
      "added": [
        "New conditions for eligibility in case of a natural disaster.",
        "Adjustment for school districts with high property value exclusion."
      ],
      "removed": [],
      "summary": "Amendments relate to the conditions under which a school district may qualify for enhanced debt service equalization aid based on natural disasters.",
      "modified": [
        "Clarification on eligible revenue calculations considering natural disasters."
      ]
    },
    "citation": "123B.53"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "The bill mentions adjusted net tax capacity involving section 127A.48 for calculations.",
      "modified": [
        "Use of adjusted net tax capacity in the financial calculations for enhanced debt service."
      ]
    },
    "citation": "127A.48"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Debt service equalization aid payment schedule references section 127A.45.",
      "modified": [
        "Payment schedule for debt service equalization aid is aligned with section 127A.45."
      ]
    },
    "citation": "127A.45"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Calculation includes adjustments for property exempted under section 272.02 when determining tax capacity.",
      "modified": [
        "Inclusion of tax capacity for normally exempt properties in financial assessments."
      ]
    },
    "citation": "272.02"
  }
]

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