Bill > HF535

This bill broadens the existing Natural Disaster Debt Service Equalization Aid program, now renamed the Enhanced Debt Service Equalization Aid program, to help school districts in two specific scenarios. First, districts can qualify for this aid if they experienced a federally declared natural disaster after January 1, 2005, that caused at least $500,000 in building damages not covered by insurance or FEMA payments. Second, districts can now also qualify if 30% or more of their property value is excluded from their taxable value. The bill modifies how these aid calculations are made, including adjusting the way net tax capacity is determined and how aid payments are calculated. When a school district qualifies, they can receive additional financial support to help them manage debt service expenses related to rebuilding after a disaster or compensating for limited tax base. The changes will apply to bond issues approved on or after July 1, 2025, and aid adjustments for fiscal year 2026 and later, providing a new mechanism to support school districts facing unique financial challenges.

Budget and Finance

https://www.revisor.mn.gov/bills/bill.php?b=House&f=HF0535&ssn=0&y=2025