1.1                          A bill for an act 
  1.2             relating to education; increasing the amount paid 
  1.3             certain school districts from the taconite referendum 
  1.4             fund; changing the distribution of revenue in the 
  1.5             taconite referendum fund; providing for enhanced 
  1.6             pairing cooperation and combination aid for school 
  1.7             districts in the taconite relief area; appropriating 
  1.8             money; amending Minnesota Statutes 1998, section 
  1.9             298.28, subdivisions 4 and 11. 
  1.10  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.11     Section 1.  Minnesota Statutes 1998, section 298.28, 
  1.12  subdivision 4, is amended to read: 
  1.13     Subd. 4.  [SCHOOL DISTRICTS.] (a) 22.28 cents per taxable 
  1.14  ton plus the increase provided in paragraph (d) must be 
  1.15  allocated to qualifying school districts to be distributed, 
  1.16  based upon the certification of the commissioner of revenue, 
  1.17  under paragraphs (b) and (c). 
  1.18     (b) 4.46 cents per taxable ton must be distributed to the 
  1.19  school districts in which the lands from which taconite was 
  1.20  mined or quarried were located or within which the concentrate 
  1.21  was produced.  The distribution must be based on the 
  1.22  apportionment formula prescribed in subdivision 2. 
  1.23     (c)(i) 17.82 cents per taxable ton, less any amount 
  1.24  distributed under paragraph (e), shall be distributed to a group 
  1.25  of school districts comprised of those school districts in which 
  1.26  the taconite was mined or quarried or the concentrate produced 
  1.27  or in which there is a qualifying municipality as defined by 
  2.1   section 273.134 in direct proportion to school district indexes 
  2.2   as follows:  for each school district, its pupil units 
  2.3   determined under section 126C.05 for the prior school year shall 
  2.4   be multiplied by the ratio of the average adjusted net tax 
  2.5   capacity per pupil unit for school districts receiving aid under 
  2.6   this clause as calculated pursuant to chapters 122A, 126C, and 
  2.7   127A for the school year ending prior to distribution to the 
  2.8   adjusted net tax capacity per pupil unit of the district.  Each 
  2.9   district shall receive that portion of the distribution which 
  2.10  its index bears to the sum of the indices for all school 
  2.11  districts that receive the distributions.  
  2.12     (ii) Notwithstanding clause (i), each school district that 
  2.13  receives a distribution under sections 298.018; 298.23 to 
  2.14  298.28, exclusive of any amount received under this clause; 
  2.15  298.34 to 298.39; 298.391 to 298.396; 298.405; or any law 
  2.16  imposing a tax on severed mineral values that is less than the 
  2.17  amount of its levy reduction under section 126C.48, subdivision 
  2.18  8, for the second year prior to the year of the distribution 
  2.19  shall receive a distribution equal to the difference; the amount 
  2.20  necessary to make this payment shall be derived from 
  2.21  proportionate reductions in the initial distribution to other 
  2.22  school districts under clause (i).  
  2.23     (d) Any school district described in paragraph (c) where a 
  2.24  levy increase pursuant to section 126C.17, subdivision 9, is 
  2.25  authorized by referendum, shall receive a distribution from a 
  2.26  fund that receives a distribution in 1998 of 21.3 cents per 
  2.27  ton.  On July 15 of 1999, and each year thereafter, the increase 
  2.28  over the amount established for the prior year shall be 
  2.29  determined according to the increase in the implicit price 
  2.30  deflator as provided in section 298.24, subdivision 1.  Each 
  2.31  district shall receive the product of: 
  2.32     (i) $175 times the pupil units identified in section 
  2.33  126C.05, subdivision 1, or for a district that consolidates 
  2.34  under section 3, $275 times the pupil units identified in 
  2.35  section 126C.05, subdivision 1, enrolled in the second previous 
  2.36  year or the 1983-1984 school year, whichever is greater, less 
  3.1   the product of 1.8 percent times the district's taxable net tax 
  3.2   capacity in the second previous year; times 
  3.3      (ii) the lesser of: 
  3.4      (A) one, or 
  3.5      (B) the ratio of the sum of the amount certified pursuant 
  3.6   to section 126C.17, subdivision 6, in the previous year, plus 
  3.7   the amount certified pursuant to section 126C.17, subdivision 8, 
  3.8   in the previous year, plus the referendum aid according to 
  3.9   section 126C.17, subdivision 7, for the current year, plus an 
  3.10  amount equal to the reduction under section 126C.17, subdivision 
  3.11  12, to the product of 1.8 percent times the district's taxable 
  3.12  net tax capacity in the second previous year. 
  3.13     If the total amount provided by paragraph (d) is 
  3.14  insufficient to make the payments herein required then the 
  3.15  entitlement of $175 per pupil unit shall be reduced uniformly so 
  3.16  as not to exceed the funds available.  Any amounts received by a 
  3.17  qualifying school district in any fiscal year pursuant to 
  3.18  paragraph (d) shall not be applied to reduce general education 
  3.19  aid which the district receives pursuant to section 126C.13 or 
  3.20  the permissible levies of the district.  Any amount remaining 
  3.21  after the payments provided in this paragraph shall be paid to 
  3.22  the commissioner of iron range resources and rehabilitation who 
  3.23  shall deposit the same in the taconite environmental protection 
  3.24  fund and the northeast Minnesota economic protection trust fund 
  3.25  as provided in subdivision 11. 
  3.26     Each district receiving money according to this paragraph 
  3.27  shall reserve $25 times the number of pupil units in the 
  3.28  district.  It may use the money for early childhood programs or 
  3.29  for outcome-based learning programs that enhance the academic 
  3.30  quality of the district's curriculum.  The outcome-based 
  3.31  learning programs must be approved by the commissioner of 
  3.32  children, families, and learning. 
  3.33     (e) There shall be distributed to any school district the 
  3.34  amount which the school district was entitled to receive under 
  3.35  section 298.32 in 1975. 
  3.36     Sec. 2.  Minnesota Statutes 1998, section 298.28, 
  4.1   subdivision 11, is amended to read: 
  4.2      Subd. 11.  [REMAINDER.] (a) The proceeds of the tax imposed 
  4.3   by section 298.24 which remain after the distributions and 
  4.4   payments in subdivisions 2 to 10a, as certified by the 
  4.5   commissioner of revenue, and paragraphs (b), (c), and (d) have 
  4.6   been made, together with interest earned on all money 
  4.7   distributed under this section prior to distribution, shall be 
  4.8   divided between the taconite environmental protection fund 
  4.9   created in section 298.223 and the northeast Minnesota economic 
  4.10  protection trust fund created in section 298.292 as follows:  
  4.11  ~~Two-thirds~~ One-third to the taconite environmental protection 
  4.12  fund and ~~one-third~~ two-thirds to the northeast Minnesota 
  4.13  economic protection trust fund.  The proceeds shall be placed in 
  4.14  the respective special accounts. 
  4.15     (b) There shall be distributed to each city, town, and 
  4.16  county the amount that it received under section 294.26 in 
  4.17  calendar year 1977; provided, however, that the amount 
  4.18  distributed in 1981 to the unorganized territory number 2 of 
  4.19  Lake county and the town of Beaver Bay based on the 
  4.20  between-terminal trackage of Erie Mining Company will be 
  4.21  distributed in 1982 and subsequent years to the unorganized 
  4.22  territory number 2 of Lake county and the towns of Beaver Bay 
  4.23  and Stony River based on the miles of track of Erie Mining 
  4.24  Company in each taxing district. 
  4.25     (c) There shall be distributed to the iron range resources 
  4.26  and rehabilitation board the amounts it received in 1977 under 
  4.27  section 298.22.  The amount distributed under this paragraph 
  4.28  shall be expended within or for the benefit of the tax relief 
  4.29  area defined in section 273.134. 
  4.30     (d) There shall be distributed to each school district 81 
  4.31  percent of the amount that it received under section 294.26 in 
  4.32  calendar year 1977. 
  4.33     Sec. 3.  [ENHANCED PAIRING COOPERATION AND COMBINATION AID; 
  4.34  IRON RANGE SCHOOL DISTRICT.] 
  4.35     Subdivision 1.  [DISTRICT ELIGIBILITY.] Any two or more of 
  4.36  the boards of independent school districts in the taconite tax 
  5.1   relief area that meet the qualifications of Minnesota Statutes, 
  5.2   section 273.134, clause (2), or are adjacent to a district that 
  5.3   meets the qualifications of section 273.134, clause (2), and 
  5.4   participate in an enhanced pairing agreement are eligible for a 
  5.5   grant for cooperation and combination. 
  5.6      Subd. 2.  [AID AMOUNT.] A district that is participating in 
  5.7   an enhanced pairing agreement is eligible for consolidation 
  5.8   transition revenue under Minnesota Statutes, section 123A.485, 
  5.9   and is also eligible for additional state aid equal to $100 
  5.10  times the number of pupil units enrolled in an enhanced paired 
  5.11  district in the year prior to consolidation and the first year 
  5.12  of consolidation. 
  5.13     Subd. 3.  [AID USES.] A district receiving aid under this 
  5.14  section must use the aid consistent with the purposes listed 
  5.15  under Minnesota Statutes, section 123A.485, or other purposes 
  5.16  related to combination of the individual districts as determined 
  5.17  by the school board.  If, after receipt of state aid under this 
  5.18  section the districts choose not to combine and receive aid 
  5.19  under Minnesota Statutes, section 123A.485, the commissioner of 
  5.20  children, families, and learning must recover aid equal to $25 
  5.21  times the number of pupil units in the enhanced paired district. 
  5.22     Sec. 4.  [APPROPRIATION.] 
  5.23     $....... is appropriated in fiscal year 2001 from the 
  5.24  general fund to the commissioner of children, families, and 
  5.25  learning for the purposes of section 3. 
  5.26     Sec. 5.  [EFFECTIVE DATE.] 
  5.27     Sections 1 and 2 are effective for taxes payable for 2001 
  5.28  and later.  Section 3 is effective for fiscal year 2001.