Guideline 188.8.131.52 Capital Leases Involving Tax-Exempt Interest
Chapter 7 - General Finance Provisions
This guideline sets forth the process to be used by colleges and universities and the system office for entering into capital lease arrangements involving tax-exempt interest.
Purpose: The purpose of this guideline is to provide a consistent process for Minnesota State Colleges and Universities to follow when entering into capital lease arrangements with tax-exempt interest financing and to ensure compliance with United States tax law.
Guideline: Colleges and universities and the system office shall not enter into capital lease arrangements for under $100,000. Colleges and universities and the system office must obtain Vice Chancellor of Finance approval for capital lease arrangements of $100,000 or more that involve tax-exempt interest.
Preplanning is mandatory as tax-exempt financing transactions are complex and requires timely and accurately filing federal tax returns. Vice Chancellor approval must be requested early in the process so the Attorney General’s Office and Tax Services can provide guidance.
This procedure applies to capital leases involving tax-exempt interest; transactions where interest is taxable are not subject to this procedure.
- Policy 7.3 Financial Administration
- Procedure 7.3.1 Accounting and Payroll
- Procedure 7.3.2 Auxiliary Operations
- Guideline 184.108.40.206 Auxiliary Fund Accrual Financial Statements and Multi-year Financial Planning
- Procedure 7.3.3 Purchasing Cards
- Procedure 7.3.4 Cost Allocation
- Guideline 220.127.116.11 Cost Allocation and Implementation
- Procedure 7.3.5 Revenue Fund Management
- Procedure 7.3.6 Capital Assets
- Procedure 7.3.7 Impairment of Capital Assets
- Procedure 7.3.12 Scholarships
- Procedure 7.3.13 Surplus Personal Property/Building Disposal
- Procedure 7.3.16 Finance Exception Reporting
- Procedure 7.3.17 Electronic Payments
- Guidelines for 18.104.22.168 Guideline for Payment Card Acceptance, Processing and Security
- Master Lease Program, Minnesota Department of Administration
Date of Adoption: 4/25/06,
Date of Implementation: 4/25/06,
Date and Subject of Revisions:
11/10/14 - Amended to require Vice Chancellor of Finance approval for capital lease agreements of $100,000 or more that involve tax-exempt interest.
1/25/12 - The Chancellor amends all current system procedures effective February 15, 2012, to change the term "Office of the Chancellor" to "system office" or similar term reflecting the grammatical context of the sentence.
7/09/09 - Amended state agency names throughout procedure.
There is no additional HISTORY for 22.214.171.124 at this time.