1997 Minnesota Code
Chapters 120 - 129B Education Code: Prekindergarten - Grade 12
Chapter 121 State Administration; Interstate Compact
Section 121.914 Statutory operating debt.

121.914 Statutory operating debt.

Subdivision 1. The "operating debt" of a school district means the net negative undesignated fund balance in all school district funds, other than capital expenditure, building construction, debt service, and trust and agency, calculated as of June 30 of each year in accordance with the uniform financial accounting and reporting standards for Minnesota school districts.

Subd. 2. If the amount of the operating debt is more than 2-1/2 percent of the most recent fiscal year's expenditure amount for the funds considered under subdivision 1, the net negative undesignated fund balance shall be defined as "statutory operating debt" for the purposes of this section and sections 121.917 and 124.914, subdivision 1.

Subd. 3. The commissioner shall establish a uniform auditing or other verification procedure for school districts to determine whether a statutory operating debt exists in any Minnesota school district as of June 30, 1977. This procedure shall also identify all interfund transfers made during fiscal year 1977 from a fund included in computing statutory operating debt to a fund not included in computing statutory operating debt. The standards for this uniform auditing or verification procedure shall be promulgated by the state board pursuant to chapter 14. If a school district applies to the commissioner for a statutory operating debt verification or if the unaudited financial statement for the school year ending June 30, 1977 reveals that a statutory operating debt might exist, the commissioner shall require a verification of the amount of the statutory operating debt which actually does exist.

Subd. 4. If an audit or other verification procedure conducted pursuant to subdivision 3 determines that a statutory operating debt exists, a district shall follow the procedures set forth in section 124.914, subdivision 1, to eliminate this statutory operating debt.

Subd. 5. The commissioner of children, families, and learning shall certify the amount of statutory operating debt for each school district. Prior to June 30, 1979, the commissioner may, on the basis of corrected figures, adjust the total amount of statutory operating debt certified for any district.

Subd. 6. On January 15, 1998, the commissioner of children, families, and learning shall report to the legislature on the districts for which the levy allowable under section 124.914, subdivision 1, has been insufficient to eliminate the statutory operating debt of the district, determined as of June 30, 1977.

Subd. 7. This section and the provisions of section 124.914, subdivision 1, shall be applicable only to common, independent, and special school districts and districts formed pursuant to Laws 1967, chapter 822, as amended, and Laws 1969, chapters 775 and 1060, as amended. This section and the provisions of section 124.914, subdivision 1, shall not apply to independent school district No. 625.

Subd. 8. Any district eligible to receive any amounts pursuant to section 124.914, subdivision 1, shall disclose its statutory operating debt retirement plan by footnote to the audited financial statement.

Subd. 9. Repealed, 1989 c 329 art 9 s 34

Subd. 10. Repealed, 1989 c 329 art 9 s 34

HIST: 1976 c 271 s 32; 1977 c 447 art 7 s 9-12; 1980 c 609 art 7 s 7; 1982 c 424 s 130; 1986 c 444; 1987 c 398 art 7 s 42; 1991 c 130 s 37; 1992 c 499 art 12 s 29; 1Sp1995 c 3 art 16 s 13; 1996 c 412 art 13 s 6