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Ag tax credit impacts Greater Minnesota school bond questions

Updated: November 06, 2019 07:07 PM

Owatonna's School District asked voters for a new high school in May, but it failed. Six months later, voters said yes to the $104 million request for the new high school.

"I spent a little time in our buildings this morning, and our kids are excited, so it's a great day," said Owatonna Superintendent Jeff Elstad.

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In an unprecedented show of support, Owatonna businesses are donating more than $22 million to the new school.

"In Minnesota, I'm not aware of a larger gift to public education than what we are receiving, and that's a pretty cool thing," Elstad said.

But the district feels the ag tax credit likely helped as well.

Many referendums across the state supported by voters on Election Day

In some school districts, the tax base can be heavily dependent on agricultural land, and many of those districts have had less success passing bonds.

The tax credit provides relief for farmers.

"I think ag to school is one of the first pieces of tax relief that helps our ag landowners understand that we're pulling with them," Elstad said.

Out of 37 Minnesota school districts, 29 approved the bonds on Tuesday, and 26 of those are in Greater Minnesota and have a significant ag base, like Owatonna.

Most school districts pass referendums, others face budget cuts

"They probably, recognizably, burdened a larger share of bond referendums," said Kirk Schneidawind, the executive director of the Minnesota School Board Association.

"I think the trend is good," Schneidawind said when asked whether it could be a changing of the tide for Greater Minnesota school districts.

The School Building Bond Agricultural Credit for farmers is roughly 50 percent right now, but that rebate will increase to 70 percent in 2023.

"This certainly has eased the tax burden for them and has allowed them to look at it through the economic lens or the financial lens, but also to be able to vote in support of their community schools," said Schneidawind.

In Owatonna, the ag vote was still a no, but the district said there were fewer of them compared with last spring.

Worthington is another district that experienced failed bond referendum questions for years, but the ask was approved Tuesday night.

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Jessica Miles

Copyright 2019 - KSTP-TV, LLC A Hubbard Broadcasting Company

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