The bill amends Minnesota Statutes 2022, section 16A.105, to establish a debt limit for the state, which will be included in the debt capacity forecast prepared by the commissioner in February and November each year. The forecast will now include detailed statements of the state's indebtedness, actual debt service amounts for the past two fiscal years, and estimates for the current and next six fiscal years. Starting with forecasts prepared after July 1, 2024, the forecast must also incorporate a newly defined debt limit that restricts the maximum amount of new debt that can be issued based on a percentage of estimated nondedicated general fund revenue.

The bill defines "debt" to include various forms of state debt payable from nondedicated state general fund revenues, such as general obligation bonds and lease-purchase financing. It establishes specific limits on the amount of new debt that can be issued, ensuring that payments on all outstanding debt do not exceed three percent of estimated nondedicated general fund revenue, and that payments on certain types of debt do not exceed 0.6 percent. The debt limits are designed to manage the state's debt prudently and can only be used to delay the issuance of new debt authorized by law if the forecast indicates that the limits will be exceeded.

Statutes affected:
Introduction: 16A.105