Payable 2014 Debt Excess Instructions – Fund 7 and Fund 47
Minnesota Statutes, section 475.61, Subd. 3 states in part: “… d) By August 15 each year, the commissioner shall determine the excess fund balance for each school district, and shall certify the amount of the excess balance to the school district superintendent”. This includes both regular debt service (Fund 7) and OPEB debt service (Fund 47) excess fund balances. The Payable 2014 Debt Excess spreadsheet serves as the commissioner's certification of these balances that will be used to reduce Payable 2014 debt service levies.
The calculated debt excess may be revised under the following circumstances:
• The stated UFARS fund balance is incorrect.
• An existing escrow account is included in the calculated excess balance (please provide documentation from your audit report or other substantiated documentation from your auditor).
• An escrow account was established in FY 2013 or will be established in FY 2014 using funds in the restricted fund balance (GNL 464) (please provide documentation indicating the specific debt obligation defeasance, the financial institution holding the escrow account, and the date the obligation is to be retired).
• A portion of the fund balance is required to meet FY 2014 debt obligations (provide a spreadsheet showing FY 2013 - 2015 beginning cash and investment balances, receipts and disbursements by date, and the FY 2015 shortfall expected).
• A debt redemption payment was made or will be made in FY 2013 or 2014 for which a levy has not been certified (please provide the debt redemption schedule for the specific debt obligation).
• The gross debt service levy, before the excess balance adjustment, is increasing between the Payable 2013 and Payable 2014 levy years at a greater rate than the rate of increase for the district’s valuation. In this situation, the excess may be adjusted to even-out significant increases in the debt service tax rate. (To document a need to retain a portion of the excess, please provide a written estimate from the home county assessor stating the valuation change between the years).
• Since 5 percent of the current required debt service levy is a reduction in computing the debt excess, any change in the Payable 2014 required debt service levy will change the debt excess.
Districts with an outstanding capital loan are shown without a debt excess on the Payable 2014 Debt Excess spreadsheet. The capital loan districts will continue to use the Debt Redemption Excess Amount Computation form at a later date in determining the amount to be paid to the state on their loan.
The school district may increase the amount of debt excess and levy reduction by submitting a request for a larger amount and providing documentation that there will be adequate funds to satisfy obligations (Minn. Stat. § 475.61, Subd. 3 (g)).
Approval to retain excess amounts for reasons stated above will be based upon statutory provisions and documentation provided by the district. Districts approved for retention of debt excess amounts will see the revised calculation of the debt excess on the 2013 Payable 2014 Levy Limitation and Certification report.
The spreadsheet, Payable 2014 Debt Excess, appearing on the MDE website will not be revised. Any revisions to the debt excess will appear on the 2013 Payable 2014 Levy Limitation and Certification.
School Finance Contacts:
Tel: (651) 582-8801
Tel: (651) 582-8319