The new, permanent Ag2School tax credit for agricultural land takes effect as 39 Minnesota school districts seek approval Nov. 7 for school building and technology bonds and other districts consider building referendums in 2018.

The Ag2School credit applies to all current and future capital referendums, Minnesota Rep. Paul Anderson says in a report from the Council of State Governments.

“If a farmer’s levy for a school building referendum was $25 per acre, for example, the state would provide him or her with a credit of $10 per acre (40 percent).” View report

The 40 percent agricultural bond credit known as Ag2School passed into law in June and enjoys a broad base of bipartisan support. It is permanent law, existing into perpetuity, as stated in the appropriations portion of Subdivision 5 of the statute:

“An amount sufficient to make the payments required by this section is annually appropriated from the general fund to the commissioner of education.” View the statute

It would take an act of both bodies of the legislature and a signature by the Governor to amend or repeal the program.

“Repealing or reducing the program would mean a vote for raising taxes on the backs on rural Minnesota farmers and harming equity in school funding for kids and parents,” said Sam Walseth, MREA Director of Legislative Affairs. “Not only is this extremely unlikely, but the strong coalition of like-minded rural interests (MREA, farm groups and others) would link arms to defeat any attempt to renege on the 40 percent credit to farmers for school facilities for rural children’s education.”

The Ag2School tax credit comes as farmers have historically carried a high percentage of the school bond bill. Farmers in some agriculture-rich school districts in Minnesota pay up to 10 times as much as other taxpayers in those same districts, according to the Minnesota Farm Bureau. Learn more about what AgSchool and next steps from MREA member IIW Minnesota.

“This tax credit gives farmers the tax relief that they deserve while providing schools with critical resources that they need for their facilities,” MREA Executive Director Fred Nolan said. “It created a fairer state share in 284 school districts in Minnesota.” View Ag2School’s impact on school districts.