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Last Updated: 10/26/2015

Guaranteed Distributions

Some recipients and funds are guaranteed to receive a certain level of aid from the Production Tax. The Minnesota Department of Revenue determines the amount of the guaranteed aid payments.

Variable Aid Guarantee (based on 1983 aid)

Some recipients are guaranteed to receive distributions of at least the amount they received for the 1983 production year, provided that current-year production is not less than 42 million taxable tons. If production is less, the guaranteed amount varies. The amount is reduced proportionately by 2 percent per each 1 million tons by which the taxable tons are less than 42 million tons. Recipients receive either the regular distribution amount or the guaranteed amount, whichever is greater.

The aid guarantee currently affects the following recipients and funds:

  • Taconite Municipal Aid Account
  • Taconite Referendum Fund
  • Iron Range Resources and Rehabilitation Board (IRRRB)
  • Range Association of Municipalities and Schools (RAMS)
  • Taconite Property Tax Relief Fund payments to counties with a qualifying power plant

The following county funds are guaranteed to receive 75 percent of their 1983 aid amount, or the variable guarantee amount, whichever is less:

  • County Fund
  • County Road and Bridge Fund

The following school funds are guaranteed to receive 31.2 percent of their 1983 aid amount, or the variable guarantee, whichever is less:

  • Regular School Fund
  • Taconite School Fund
  • Taconite Property Tax Relief Fund payments to school districts with a qualifying power plant

Variable Aid Guarantee (based on 1999 aid)

The following recipients are guaranteed to receive distributions of at least the amount they received for the 1999 production year, provided that current-year production is not less than 42 million taxable tons. If production is less, the amount varies in the same way as the 1983 variable aid guarantee.

  • Cities and towns where mining is located
  • Cities and towns affected by mining (“Mining Effects”)

Variable Aid Guarantee Funding

The variable aid guarantee is funded equally from the initial current-year distributions to the Taconite Environmental Protection Fund (TEPF) and the DJJ. If the initial distributions are insufficient to fund the guaranteed amounts, the Iron Range Resources and Rehabilitation Board (IRRRB) makes the payments of any remaining difference from the existing balance of the TEPF and the Douglas J. Johnson Economic Protection Trust Fund (DJJ) in equal proportions.