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03/24/08
REVISOR
XX/SH 08-6771
This Document can be made available
in alternative formats upon request
State of Minnesota
HOUSE OF REPRESENTATIVES
EIGHTY-FIFTH SESSION
HOUSE FILE No. 4127
March 27 2008
Authored by Jaros, Rukavina, , Mariani, Murphy. M. and Greiling
The bill was read for the first time and referred to the committee on Taxes
1.1 A bill for an act
1.2 relating to property taxes; limiting a school district's use of certain lease purchase
1.3 agreements; amending Minnesota Statutes 2006, section 126C.40, subdivision 6.
1.4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.5 Section 1. Minnesota Statutes 2006, section 126C.40, subdivision 6, is amended to read:
1.6 Subd. 6. Lease purchase; installment buys. (a) Upon application to, and approval
1.7 by, the commissioner in accordance with the procedures and limits in subdivision 1,
1.8 paragraphs (a) and (b), a district, as defined in this subdivision, may:
1.9 (1) purchase real or personal property under an installment contract or may lease
1.10 real or personal property with an option to purchase under a lease purchase agreement, by
1.11 which installment contract or lease purchase agreement title is kept by the seller or vendor
1.12 or assigned to a third party as security for the purchase price, including interest, if any; and
1.13 (2) annually levy the amounts necessary to pay the district's obligations under the
1.14 installment contract or lease purchase agreement. A district that no longer qualifies for
1.15 eligibility under paragraph (d) may only levy the amount under this subdivision for which
1.16 it is specifically obligated to repay under a binding legal contract. The district may not
1.17 levy for any other purposes under this subdivision without first having received authority
1.18 to do so through an election called for that purpose.
1.19 (b) The obligation created by the installment contract or the lease purchase
1.20 agreement must not be included in the calculation of net debt for purposes of section
1.21 475.53, and does not constitute debt under other law. An election is not required in
1.22 connection with the execution of the installment contract or the lease purchase agreement.
1.23 (c) The proceeds of the levy authorized by this subdivision must not be used to
1.24 acquire a facility to be primarily used for athletic or school administration purposes.
2.1 (d) For the purposes of this subdivision, "district" means:
2.2 (1) a school district serving more than 50 percent protected students as defined under
2.3 Minnesota Rules, part 3535.0110, that is required to have a comprehensive plan for the
2.4 elimination of segregation whose plan has been determined by the commissioner to be
2.5 in compliance with Department of Education rules relating to equality of educational
2.6 opportunity and school desegregation and, for a district eligible for revenue under
2.7 section 124D.86, subdivision 3, clause (4), where the acquisition of property under this
2.8 subdivision is determined by the commissioner to contribute to the implementation of
2.9 the desegregation plan; or
2.10 (2) a school district that participates in a joint program for interdistrict desegregation
2.11 with a district defined in clause (1) if the facility acquired under this subdivision is to
2.12 be primarily used for the joint program and the commissioner determines that the joint
2.13 programs are being undertaken to implement the districts' desegregation plan.
2.14 (e) Notwithstanding subdivision 1, the prohibition against a levy by a district to lease
2.15 or rent a district-owned building to itself does not apply to levies otherwise authorized
2.16 by this subdivision.
2.17 (f) For the purposes of this subdivision, any references in subdivision 1 to building
2.18 or land shall include personal property.
2.19 EFFECTIVE DATE. This section is effective the day following final enactment.
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