The House of Representatives convened at 2:30 p.m. and was called to order by Phil Carruthers, Speaker of the House.
Prayer was offered by the Reverend Ronald A. Smith, House Chaplain.
Music was performed by the Unity Baptist Adult Choir, St. Paul, Minnesota.
The roll was called and the following members were present:
| Abrams | Erhardt | Juhnke | Marko | Pelowski | Tingelstad | 
| Anderson, B. | Erickson | Kahn | McCollum | Peterson | Tomassoni | 
| Anderson, I. | Evans | Kalis | McElroy | Pugh | Tompkins | 
| Bakk | Farrell | Kelso | McGuire | Rest | Trimble | 
| Bettermann | Finseth | Kielkucki | Milbert | Reuter | Tuma | 
| Biernat | Folliard | Kinkel | Molnau | Rhodes | Tunheim | 
| Bishop | Garcia | Knight | Mulder | Rifenberg | Van Dellen | 
| Boudreau | Goodno | Knoblach | Mullery | Rostberg | Vandeveer | 
| Bradley | Greenfield | Koskinen | Munger | Rukavina | Wagenius | 
| Broecker | Greiling | Kraus | Murphy | Schumacher | Weaver | 
| Carlson | Gunther | Krinkie | Ness | Seagren | Wejcman | 
| Chaudhary | Haas | Kubly | Nornes | Seifert | Wenzel | 
| Clark, J. | Harder | Kuisle | Olson, E. | Sekhon | Westfall | 
| Clark, K. | Hasskamp | Larsen | Olson, M. | Skare | Westrom | 
| Commers | Hausman | Leighton | Opatz | Skoglund | Winter | 
| Daggett | Hilty | Leppik | Orfield | Slawik | Wolf | 
| Davids | Holsten | Lieder | Osskopp | Smith | Workman | 
| Dawkins | Huntley | Lindner | Osthoff | Solberg | Spk. Carruthers | 
| Dehler | Jaros | Long | Otremba, M. | Stanek | |
| Delmont | Jefferson | Macklin | Ozment | Stang | |
| Dempsey | Jennings | Mahon | Paulsen | Sviggum | |
| Dorn | Johnson, A. | Mares | Pawlenty | Swenson, H. | |
| Entenza | Johnson, R. | Mariani | Paymar | Sykora | |
A quorum was present.
Luther was excused.
The Chief Clerk proceeded to read the Journals of the preceding days. Dorn moved that further reading of the Journals be suspended and that the Journals be approved as corrected by the Chief Clerk. The motion prevailed.
S. F. No. 2047 and H. F. No. 3148, which had been referred to the Chief Clerk for comparison, were examined and found to be identical.
Kubly moved that S. F. No. 2047 be substituted for H. F. No. 3148 and that the House File be indefinitely postponed. The motion prevailed.
S. F. No. 2192 and H. F. No. 2700, which had been referred to the Chief Clerk for comparison, were examined and found to be identical with certain exceptions.
Harder moved that the rules be so far suspended that S. F. No. 2192 be substituted for H. F. No. 2700 and that the House File be indefinitely postponed. The motion prevailed.
S. F. No. 2266 and H. F. No. 2523, which had been referred to the Chief Clerk for comparison, were examined and found to be identical with certain exceptions.
Johnson, A., moved that the rules be so far suspended that S. F. No. 2266 be substituted for H. F. No. 2523 and that the House File be indefinitely postponed. The motion prevailed.
S. F. No. 2516 and H. F. No. 2777, which had been referred to the Chief Clerk for comparison, were examined and found to be identical with certain exceptions.
Jefferson moved that the rules be so far suspended that S. F. No. 2516 be substituted for H. F. No. 2777 and that the House File be indefinitely postponed. The motion prevailed.
S. F. No. 2570 and H. F. No. 2659, which had been referred to the Chief Clerk for comparison, were examined and found to be identical.
Olson, E., moved that S. F. No. 2570 be substituted for H. F. No. 2659 and that the House File be indefinitely postponed. The motion prevailed.
S. F. No. 2608 and H. F. No. 3065, which had been referred to the Chief Clerk for comparison, were examined and found to be identical with certain exceptions.
 Dorn moved that the rules be so far suspended that S. F. No. 2608 be substituted for H. F. No. 3065 and that the House
File be indefinitely postponed.  The motion prevailed. 
 S. F. No. 2659 and H. F. No. 3432, which had been referred to the Chief Clerk for comparison, were examined and
found to be identical. 
 Wenzel moved that S. F. No. 2659 be substituted for H. F. No. 3432 and that the House File be indefinitely postponed. 
The motion prevailed. 
          
 Kahn from the Committee on Governmental Operations to which was referred:  
 H. F. No. 384, A bill for an act relating to state agencies; modifying procurement procedures; amending Minnesota
Statutes 1996, sections 16B.04, subdivisions 1 and 2; 16B.19, subdivisions 1a, 2a, 2b, and 2c; 16B.20, subdivision 1;
16B.226; 16B.28; 16B.29; 16B.482; and 16B.89; proposing coding for new law in Minnesota Statutes, chapters 16B;
and 16C; repealing Minnesota Statutes 1996, sections 16B.01, subdivisions 4 and 5; 16B.06; 16B.07; 16B.08; 16B.09;
16B.101; 16B.102; 16B.103; 16B.121; 16B.123; 16B.13; 16B.14; 16B.15; 16B.16; 16B.167; 16B.17; 16B.175; 16B.18;
16B.181; and 16B.185.  
 Reported the same back with the following amendments:  
 Delete everything after the enacting clause and insert:  
 
 
 
 
 Section 1.  Minnesota Statutes 1996, section 15.054, is amended to read:  
 15.054 [PUBLIC EMPLOYEES NOT TO PURCHASE MERCHANDISE FROM GOVERNMENTAL AGENCIES;
EXCEPTIONS; PENALTY.]  
 No officer or employee of the state or any of its political subdivisions shall sell or procure for sale or possess or control
for sale to any other officer or employee of the state or  
 Sec. 2.  Minnesota Statutes 1996, section 16B.181, is amended to read:  
 16B.181 [PURCHASES FROM CORRECTIONS INDUSTRIES.]  
 Subdivision 1.  [DEFINITIONS.] As used in this section:  
 (1) "public entity" or "public entities" includes the state and an agency, department, or institution of the state, any
governmental unit as defined in section 471.59, the state legislative and judicial branches, and state colleges and
universities; and  
  (2) "items" includes articles, products, supplies, and services. 
 Subd. 2.  [PUBLIC ENTITIES; PURCHASES FROM CORRECTIONS INDUSTRIES.] (a) The commissioner of
corrections, in consultation with the commissioner of administration, shall prepare updated lists of the items
available for purchase from department of corrections industries and annually forward a copy of the most recent list to all
public entities within the state.  A public entity that is supported in whole or in part with funds from the state treasury
 
 (b) The commissioner of administration shall develop a contract  
 (c) No public entity may evade the intent of this section by adopting slight variations in specifications, when Minnesota
corrections industry items meet the reasonable needs and specifications of the public entity.  
 (d)  
 (e)  
 Sec. 3.  [16C.02] [DEFINITIONS.]  
 Subdivision 1.  [APPLICABILITY.] For purposes of this chapter, the following terms have the meanings
given them, unless the context clearly indicates otherwise.  
 Subd. 2.  [AGENCY.] "Agency" means any state officer, employee, board, commission, authority,
department, entity, or organization of the executive branch of state government.  
 Unless specifically provided elsewhere in this chapter, agency does not include the Minnesota state colleges and
universities.  
 Subd. 3.  [AWARD.] "Award" means a commissioner's written acceptance of a bid or proposal to provide
goods, services, or utilities.  
 Subd. 4.  [BEST VALUE.] "Best value" describes a result intended in the acquisition of all goods and
services.  Price must be one of the evaluation criteria when acquiring goods and services.  Other evaluation criteria may
include, but are not limited to, environmental considerations, quality, and vendor performance.  
 Subd. 5.  [COMMISSIONER.] "Commissioner" means the commissioner of administration.  
 Subd. 6.  [CONTRACT.] "Contract" means any written instrument or electronic document containing the
elements of offer, acceptance, and consideration to which an agency is a party.  
 Subd. 7.  [FORMAL SOLICITATION.] "Formal solicitation" means a solicitation which requires a sealed
response.  
 Subd. 8.  [GOODS.] "Goods" means all types of personal property including commodities, materials,
supplies, and equipment.  
 Subd. 9.  [INFORMAL SOLICITATION.] "Informal solicitation" means a solicitation which does not
require a sealed response.  
 Subd. 10.  [LEASE.] "Lease" means a contract conveying from one entity to another the use of real or
personal property for a designated period of time in return for payment or other consideration.  
 Subd. 11.  [REQUEST FOR BID OR RFB.] "Request for bid" or "RFB" means a solicitation in which the
terms, conditions, and specifications are described and responses are not subject to negotiation.  
 Subd. 12.  [REQUEST FOR PROPOSAL OR RFP.] "Request for proposal" or "RFP" means a solicitation
in which it is not advantageous to set forth all the actual, detailed requirements at the time of solicitation and responses
are subject to negotiation.  
 Subd. 13.  [RESIDENT VENDOR.] "Resident vendor" means a person, firm, or corporation authorized
to conduct business in the state of Minnesota on the date a solicitation for a contract is first advertised or announced.  It
includes a foreign corporation duly authorized to engage in business in Minnesota.  
 Subd. 14.  [RESPONSE.] "Response" means the offer received from a vendor in response to a solicitation. 
A response includes submissions commonly referred to as "offers," "bids," "quotes," or "proposals."  
 Subd. 15.  [SEALED.] "Sealed" means a method determined by the commissioner to prevent the contents
being revealed or known before the deadline for submission of responses.  
 Subd. 16.  [SERVICE CONTRACT.] "Service contract" means a contract for any nonprofessional or
technical services.  
 Subd. 17.  [SERVICES.] "Services" means, unless otherwise indicated, both professional or technical
services and service performed under a service contract.  
 Subd. 18.  [SINGLE SOURCE.] "Single source" means an acquisition where, after a search, only one
supplier is determined to be reasonably available for the required product, service, or construction item.  
 Subd. 19.  [SOLICITATION.] "Solicitation" means the process used to communicate procurement
requirements and to request responses from interested vendors.  A solicitation may be, but is not limited to, a request for
bid and request for proposal.  
 Sec. 4.  [16C.03] [COMMISSIONER'S AUTHORITY; POWERS AND DUTIES.]  
 Subdivision 1.  [SCOPE.] The commissioner's authority in this section applies to an agency and is subject
to other provisions of this chapter and chapter 16B.  Unless otherwise provided, the provisions in this chapter and chapter
16B do not apply to the Minnesota state colleges and universities.  
 Subd. 2.  [RULEMAKING AUTHORITY.] Subject to chapter 14, the commissioner may adopt rules,
consistent with this chapter and chapter 16B, relating to the following topics:  
 (1) solicitations and responses to solicitations, bid security, vendor errors, opening of responses, award of contracts,
tied bids, and award protest process;  
 (2) contract performance and failure to perform;  
 (3) authority to debar or suspend vendors, and reinstatement of vendors;  
 (4) contract cancellation; and  
 (5) procurement from rehabilitation facilities.  
 Subd. 3.  [ACQUISITION AUTHORITY.] The commissioner shall acquire all goods, services, and
utilities needed by agencies. The commissioner shall acquire goods, services, and utilities by any method the commissioner
deems appropriate, unless another section of law requires a particular method of acquisition be utilized.  The
commissioner shall make all decisions regarding acquisition activities.  The determination of the acquisition method and
all decisions involved in the acquisition process, unless otherwise provided for by law, shall be based on best value which
includes an evaluation of price and may include other considerations including, but not limited to, environmental
considerations, quality, and vendor performance. A best value determination must be based on the evaluation criteria
detailed in the solicitation document.  Unless it is determined by the commissioner that an alternative solicitation method
should be used to determine best value, a request for bid must be used to solicit formal responses for all building and
construction contracts.  Any or all responses may be rejected. When using the request for bid process, the bid must be
awarded to the lowest responsive and responsible bidder, taking into consideration conformity with the specifications,
terms of delivery, the purpose for which the contract or purchase is intended, the status and capability of the vendor, and
other considerations imposed in the request for bids.  The commissioner may decide which is the lowest responsible bidder
for all purchases and may use the principles of life-cycle costing, where appropriate, in determining the lowest overall bid. 
The duties set forth in this subdivision are subject to delegation pursuant to this section.  
 Subd. 4.  [CONTRACTING AUTHORITY.] The commissioner shall conduct all contracting by, for, and
between agencies and perform all contract management and review functions for contracts, except those functions
specifically delegated to be performed by the contracting agency, the attorney general, or otherwise provided for by
law.  
 Subd. 5.  [AMENDMENTS, CANCELLATIONS, AND APPEALS.] The commissioner shall, in addition
to the duties set forth in subdivisions 3 and 4, make all decisions regarding amendments, cancellations, and appeals of all
agency acquisition activities unless the duties are delegated pursuant to this section.  
 Subd. 6.  [LEASE AND INSTALLMENT PURCHASES.] The commissioner is authorized to enter into
lease purchases or installment purchases for periods not exceeding the anticipated useful life of the items acquired unless
otherwise prohibited by law.  
 Subd. 7.  [LEASE, RENTAL, AND INSTALLMENT AGREEMENTS.] The commissioner is authorized
to enter into lease, lease purchase, rental, or installment agreements for the use or acquisition, whichever is applicable,
of real or personal property.  
 Subd. 8.  [POLICY AND PROCEDURES.] The commissioner is authorized to issue policies, procedures,
and standards applicable to all acquisition activities by and for agencies.  
 Subd. 9.  [EMPLOYEE PURCHASING.] The commissioner is authorized to enter into contracts under
which a vendor agrees to sell computer equipment and related products to state employees, for their own use, at contract
prices.  Under no circumstances shall the state be liable for purchases made under this subdivision.  The provisions of
section 43A.38, subdivisions 4 and 5, clause (a), do not apply to this subdivision.  
 Subd. 10.  [COOPERATIVE PURCHASING.] The commissioner is authorized to enter into a cooperative
purchasing agreement for the provision of goods, services, and utilities with one or more other states or governmental
units, as described in section 471.59, subdivision 1.  The commissioner is authorized to enter into cooperative purchasing
agreements for the purchase of goods, services, and utilities with health care facilities that are required to provide
indigent care.  
 Subd. 11.  [SURPLUS PROPERTY.] The commissioner is authorized to purchase, accept, transfer,
warehouse, sell, distribute, or dispose of surplus property in accordance with state and federal rules and regulations.  The
commissioner may charge a fee to cover any expenses incurred in connection with any of these acts.  
 Subd. 12.  [CENTRAL DISTRIBUTION CENTER.] The commissioner is authorized to provide and
manage a central distribution center for federal and state surplus personal property, as defined in section 16C.25, and may
provide and manage a warehouse facility.  
 Subd. 13.  [CENTRAL STORES.] The commissioner is authorized to provide agencies with supplies and
equipment and operate all central stores and supply rooms serving more than one agency.  
 Subd. 14.  [PROVISION OF GOODS, SERVICES, AND UTILITIES.] The commissioner has the
authority to provide goods, services, and utilities under this chapter to state legislative and judicial branch agencies,
political subdivisions, the Minnesota state colleges and universities, the University of Minnesota, and federal government
agencies.  
 Subd. 15.  [REIMBURSEMENT FOR GOODS, SERVICES, AND UTILITIES.] The commissioner is
authorized to charge a fee to cover costs and expenses associated with operating a revolving fund or an enterprise fund
to acquire goods, services, and utilities.  The fees are appropriated to the commissioner to administer and manage the
programs and facilities covered under this section.  
 Subd. 16.  [DELEGATION OF DUTIES.] The commissioner may delegate duties imposed by this chapter
to the head of an agency and to any subordinate of the agency head.  Delegated duties shall be exercised in the name of
the commissioner and under the commissioner's direct supervision and control.  A delegation of duties may include, but
is not limited to, allowing individuals within agencies to acquire goods, services, and utilities within dollar limitations and
for designated types of acquisitions. Delegation of contract management and review functions must be filed with the
secretary of state and may not, except with respect to delegations within the department of administration, exceed two years
in duration.  The commissioner may withdraw any delegation at the commissioner's sole discretion.  
 Sec. 5.  [16C.05] [ETHICAL PRACTICES AND CONFLICT OF INTEREST.]  
 Subdivision 1.  [DUTY.] An employee of the executive branch involved directly or indirectly in the
acquisition process, at any level, is subject to the code of ethics in section 43A.38.  
 Subd. 2.  [CONFLICT OF INTEREST POLICY DEVELOPMENT.] (a) The commissioner must develop
policies regarding code of ethics and conflict of interest designed to prevent conflicts of interest for employees involved
in the acquisition of goods, services, and utilities.  The policies must apply to employees who are directly or indirectly
involved in the acquisition of goods, services, and utilities, developing requests for proposals, evaluating bids or proposals,
awarding the contract, selecting the final vendor, drafting and entering into contracts, evaluating performance under these
contracts, and authorizing payments under the contract.  
 (b) The policies must contain a process for making employees aware of policy and laws relating to conflict of
interest, and for training employees on how to avoid and deal with potential conflicts.  
 (c) The policies must contain a process under which an employee who has a conflict of interest or a potential
conflict of interest must disclose the matter, and a process under which work on the contract may be assigned to another
employee if possible.  
 Sec. 6.  [16C.06] [CONTRACT MANAGEMENT; VALIDITY AND REVIEW.]  
 Subdivision 1.  [AGENCY COOPERATION.] Agencies shall fully cooperate with the commissioner in
the management and review of state contracts.  
 Subd. 2.  [CREATION AND VALIDITY OF CONTRACTS.] (a) A contract is not valid and the state
is not bound by it unless:  
 (1) it has first been executed by the head of the agency or a delegate who is a party to the contract;  
 (2) it has been approved by the commissioner;  
 (3) it has been approved by the attorney general or a delegate as to form and execution;  
 (4) the accounting system shows an obligation in an expense budget or encumbrance for the amount of the contract
liability; and  
 (5) the combined contract and amendments shall not exceed five years, unless otherwise provided for by law.  The
term of the original contract must not exceed two years unless the commissioner determines that a longer duration is in
the best interest of the state.  
 (b) Grants, interagency agreements, purchase orders, and annual plans need not, in the discretion of the
commissioner and attorney general, require the signature of the commissioner and/or the attorney general.  
 (c) A fully executed copy of every contract must be kept on file at the contracting agency.  
 Subd. 3.  [EXCEPTION.] The requirements of subdivision 2 do not apply to contracts of the department
of economic security distributing state and federal funds for the purpose of subcontracting the provision of program
services to eligible recipients.  For these contracts, the commissioner of economic security is authorized to directly enter
into agency contracts and encumber available funds.  For contracts distributing state or federal funds pursuant to the
federal Economic Dislocation and Worker Adjustment Assistance Act, United States Code, title 29, section 1651 et seq.,
or sections 268.9771, 268.978, 268.9781, and 268.9782, the commissioner of economic security is authorized to directly
enter into agency contracts with approval of the workforce development council and encumber available funds to ensure
a rapid response to the needs of dislocated workers.  The commissioner of economic security shall adopt internal
procedures to administer and monitor funds distributed under these contracts.  This exception also applies to any contracts
entered into by the commissioner of children, families, and learning that were previously entered into by the commissioner
of economic security.  
 Subd. 4.  [CONTRACT ADMINISTRATION.] A contracting agency shall diligently administer and
monitor any contract it has entered into, pursuant to a delegation of duties from the commissioner.  The commissioner may
require an agency to report to the commissioner at any time on the status of any contracts to which the agency is a
party.  
 Subd. 5.  [SUBJECT TO AUDIT.] A contract or any pass- through disbursement of public funds to a
vendor of goods or services or a grantee made by or under the supervision of the commissioner or any county or unit of
local government must include, expressed or implied, an audit clause that provides that the books, records, documents,
and accounting procedures and practices of the vendor or other party, that are relevant to the contract or transaction, are
subject to examination by the contracting agency and either the legislative auditor or the state auditor, as appropriate, for
a minimum of six years.  If the contracting agency is a local unit of government, and the governing body of the local unit
of government requests that the state auditor examine the books, records, documents, and accounting procedures and
practices of the vendor or other party pursuant to this subdivision, the contracting agency shall be liable for the cost of the
examination.  If the contracting agency is a local unit of government, and the grantee, vendor, or other party requests that
the state auditor examine all books, records, documents, and accounting procedures and practices related to the contract,
the grantee, vendor, or other party that requested the examination shall be liable for the cost of the examination.  An agency
contract made for purchase, lease, or license of software and data from the state is not required to contain this audit
clause.  
 Subd. 6.  [AUTHORITY OF ATTORNEY GENERAL.] The attorney general may pursue remedies
available by law to avoid the obligation of an agency to pay under a contract or to recover payments made if services
performed or goods received under the contract are so unsatisfactory, incomplete, or inconsistent that payment would
involve unjust enrichment.  The contrary opinion of the contracting agency does not affect the power of the attorney general
under this subdivision.  
 Subd. 7.  [CONTRACTS WITH INDIAN TRIBES AND BANDS.] Notwithstanding any other law, an
agency may not require an Indian tribe or band to deny its sovereignty as a requirement or condition of a contract with an
agency.  
 Sec. 7.  [16C.07] [ACQUISITIONS.]  
 Subdivision 1.  [PUBLICATION REQUIREMENTS.] Notices of solicitations for acquisitions estimated
to be more than $25,000 must be publicized in a manner designated by the commissioner.  
 Subd. 2.  [SOLICITATION PROCESS.] (a) A formal solicitation must be used to acquire all goods,
service contracts, and utilities estimated at or more than $25,000 unless otherwise provided for.  All formal responses must
be sealed when they are received and must be opened in public at the hour stated in the solicitation.  Formal responses
must be authenticated by the responder in a manner specified by the commissioner.  
 (b) An informal solicitation may be used to acquire all goods, service contracts, and utilities that are estimated at
less than $25,000.  The number of vendors required to receive solicitations may be determined by the commissioner. 
Informal responses must be authenticated by the responder in a manner specified by the commissioner.  
 Subd. 3.  [INFORMATION IN BIDS AND PROPOSALS.] (a) Only the name of the vendor and dollar
amounts specified in a response to a request for bids shall be read at the time of opening.  Only the name of the responding
vendors to all requests for proposals shall be read at the time of opening.  All other information contained in a vendor's
response to a bid is classified as nonpublic data, as defined in section 13.02, and remains nonpublic data until completion
of the selection process.  All other information contained in a vendor's response to a request for proposal, other than the
name of the vendor, is classified as nonpublic data, as defined in section 13.02, and remains nonpublic data until the
completion of the evaluation process.  
 (b) All responses are public information at the time of the award unless otherwise provided for.  All responses and
documents pertaining to the final award of an acquisition must be retained and made a part of a permanent file or record
and remain open to public inspection, after award, unless otherwise provided for by law.  
 Subd. 4.  [MULTIPLE AWARDS.] The commissioner may award a contract to more than one vendor if,
in the opinion of the commissioner, it is in the best interest of the state.  
 Subd. 5.  [STATE AS RESPONDER.] The head of an agency, in consultation with the requesting agency
and the commissioner, may respond to a solicitation or request if the goods and services meet the needs of the requesting
agency and provide the state with the best value.  When an agency responds to a solicitation, all work product relating to
the response is nonpublic data as defined in section 13.02, and shall become public information in accordance with
subdivision 3.  
 Subd. 6.  [AWARDS.] Awards must be based on best value, which includes an evaluation of price, and
may include other considerations including, but not limited to, environmental considerations, quality, and vendor
performance.  
 Subd. 7.  [OTHER STATES WITH RESIDENT PREFERENCE.] Acquisition of goods and services must
be awarded according to the provisions of this chapter except that a resident vendor shall be allowed a preference over
a nonresident vendor from a state that gives or requires a preference to vendors from that state.  The preference shall be
equal to the preference given or required by the state of the nonresident vendor.  
 Subd. 8.  [FEDERALLY FUNDED PROJECTS EXEMPT.] Subdivision 7 does not apply to a contract
for any project in which federal funds are expended.  
 Subd. 9.  [REJECTION.] At the discretion of the commissioner, any or all responses may be rejected if
it is determined to be in the best interest of the state.  
 Subd. 10.  [PREFERENCES NOT CUMULATIVE.] The preferences provided for under subdivision 7
and sections 16B.121 and 16C.18 are not cumulative.  The total percentage of preference granted on a contract may not
exceed the highest percentage of preference allowed for that contract under any one of these statutory sections.  
 Sec. 8.  [16C.08] [EMPLOYEE SKILLS INVENTORY.]  
 The commissioner of employee relations shall develop a directory of services that state agencies commonly provide
that are professional or technical in nature.  
 Before an agency may seek approval of a professional or technical services contract valued at a total cost in excess
of $25,000, it must certify to the commissioner that it has publicized the contract by posting notice at appropriate worksites
within agencies and has made reasonable efforts to determine that no state employee or agency, including an employee
or agency outside the contracting agency, is able and available to perform the required services.  When possible, this
posting should be done electronically.  
 Sec. 9.  [16C.09] [PROFESSIONAL OR TECHNICAL SERVICES.]  
 Subdivision 1.  [DEFINITION.] For the purposes of this section, "professional or technical services"
means services that are intellectual in character, including consultation, analysis, evaluation, prediction, planning,
programming, or recommendation, and result in the production of a report or the completion of a task.  Professional or
technical contracts do not include the provision of supplies or materials except by the approval of the commissioner or
except as incidental to the provision of professional or technical services.  
 Subd. 2.  [DUTIES OF CONTRACTING AGENCY.] Before an agency may seek approval of a
professional or technical services contract valued in excess of $5,000, it must certify to the commissioner that:  
 (1) no current state employee is able and available to perform the services called for by the contract;  
 (2) the normal competitive bidding mechanisms will not provide for adequate performance of the services;
 
 (3) the contractor has certified that the product of the services will be original in character;  
 (4) reasonable efforts were made to publicize the availability of the contract to the public;  
 (5) the agency has received, reviewed, and accepted a detailed work plan from the contractor for performance under
the contract, if applicable;  
 (6) the agency has developed, and fully intends to implement, a written plan providing for the assignment of specific
agency personnel to a monitoring and liaison function, the periodic review of interim reports or other indications of past
performance, and the ultimate utilization of the final product of the services; and  
 (7) the agency will not allow the contractor to begin work before funds are fully encumbered. 
 Subd. 3. [PROCEDURE FOR 
PROFESSIONAL OR TECHNICAL SERVICES CONTRACTS.] Before 
approving a proposed contract for professional or technical services, the 
commissioner must determine, at least, that: 
 (1) all provisions of subdivision 
2 and section 16C.18 have been verified or complied with; 
 (2) the work to be performed under 
the contract is necessary to the agency's achievement of its statutory 
responsibilities and there is statutory authority to enter into the 
contract; 
 (3) the contract will not 
establish an employment relationship between the state or the agency and any 
persons performing under the contract; 
 (4) the contractor and agents are 
not employees of the state; 
 (5) no agency has previously 
performed or contracted for the performance of tasks which would be 
substantially duplicated under the proposed contract; 
 (6) the contracting agency has 
specified a satisfactory method of evaluating and using the results of the work 
to be performed; and 
 (7) the combined contract and 
amendments will not exceed five years, unless otherwise provided for by law. The 
term of the original contract must not exceed two years unless the commissioner 
determines that a longer duration is in the best interest of the state. 
 Subd. 4. [REPORTS.] (a) The commissioner shall submit to the governor, the 
chairs of the house ways and means and senate finance committees, and the 
legislative reference library a yearly listing of all contracts for professional 
or technical services executed. The report must identify the contractor, 
contract amount, duration, and services to be provided. The commissioner shall 
also issue yearly reports summarizing the contract review activities of the 
department by fiscal year. 
 (b) The fiscal year report must be 
submitted by September 1 of each year and must: 
 (1) be sorted by agency and by 
contractor; 
 (2) show the aggregate value of 
contracts issued by each agency and issued to each contractor; 
 (3) distinguish between contracts 
that are being issued for the first time and contracts that are being 
extended; 
 (4) state the termination date of 
each contract; 
 (5) identify services by commodity 
code, including topics such as contracts for training, contracts for research 
and opinions, and contracts for computer systems; 
 (6) show the number of sole 
source/single source and overload contracts for each agency as a percent of the 
total number of contracts for each agency; and 
 (7) show the number of contracts 
publicly advertised as a percent of the total number of contracts for each 
agency. 
 (c) Within 30 days of final 
completion of a contract over $40,000 covered by this subdivision, the head of 
the agency entering into the contract must submit a one-page report to the 
commissioner who must submit a copy to the legislative reference library. The 
report must: 
 (1) summarize the purpose of the 
contract, including why it was necessary to enter into a contract; 
 (2) state the amount spent on the 
contract; and 
 (3) explain why this amount was a 
cost-effective way to enable the agency to provide its services or products 
better or more efficiently. 
 Subd. 5. [CONTRACT TERMS.] (a) A professional or technical services contract must by 
its terms permit the commissioner to unilaterally terminate the contract prior 
to completion, upon payment of just compensation, if the commissioner determines 
that further performance under the contract would not serve agency purposes. 
 (b) The terms of a contract must 
provide that no more than 90 percent of the amount due under the contract may be 
paid until the final product has been reviewed by the head of the agency 
entering into the contract and the head of the agency has certified that the 
contractor has satisfactorily fulfilled the terms of the contract, unless 
specifically excluded in writing by the commissioner. 
 Subd. 6. [FILING COPY.] If the final product of the contract is a written report, a 
copy must be filed with the legislative reference library. 
 Subd. 7. [EXCLUSIONS.] This section does not apply to contracts with individuals or 
organizations for administration of employee pension plans authorized under 
chapter 354B or 354C. 
 Sec. 10. [16C.10] [PROCEDURE FOR SERVICE CONTRACTS.] 
 Before entering into or approving 
a service contract, the commissioner must determine, at least, that: 
 (1) no current state employee is 
able and available to perform the services called for by the contract; 
 (2) the work to be performed under 
the contract is necessary to the agency's achievement of its statutory 
responsibilities and there is statutory authority to enter into the 
contract; 
 (3) the contract will not 
establish an employment relationship between the state or the agency and any 
persons performing under the contract; 
 (4) the contractor and agents are 
not employees of the state; 
 (5) the contracting agency has 
specified a satisfactory method of evaluating and using the results of the work 
to be performed; and 
 (6) the combined contract and 
amendments will not exceed five years, unless otherwise provided for by law. The 
term of the original contract must not exceed two years, unless the commissioner 
determines that a longer duration is in the best interest of the state. 
 For purposes of clause (1), 
employees are available if qualified and: 
 (i) are already doing the work in 
question; or 
 (ii) are on layoff status in 
classes that can do the work in question. 
 An employee is not available if 
the employee is doing other work, is retired, or has decided not to do the work 
in question. 
 Sec. 11. [16C.11] [EXCEPTIONS TO THE SOLICITATION 
PROCESS.] 
 Subdivision 1. [SINGLE 
SOURCE.] The solicitation process described in this 
chapter is not required when there is clearly and legitimately only a single 
source for the goods and services and the commissioner determines that the price 
has been fairly and reasonably established. 
 Subd. 2. [EMERGENCY 
ACQUISITION.] (a) For the purpose of this subdivision, 
"emergency" means a threat to public health, welfare, or safety that threatens 
the functioning of government, the protection of property, or the health or 
safety of people. 
 (b) The solicitation process 
described in this chapter is not required in emergencies. In emergencies, the 
commissioner may make any purchases necessary for the repair, rehabilitation, 
and improvement of a state-owned structure or may authorize an agency to do so 
and may purchase, or may authorize an agency to purchase, goods, services, or 
utility services directly for immediate use. 
 Subd. 3. [FEDERAL AGENCY PRICE 
SCHEDULES.] Notwithstanding anything in this chapter to 
the contrary, the commissioner may, instead of soliciting bids, contract for 
purchases with suppliers who have published schedules of prices effective for 
sales to any federal agency of the United States. These contracts may be entered 
into, regardless of the amount of the purchase price, if the commissioner 
considers them advantageous and if the purchase price of all the commodities 
purchased under the contract do not exceed the price specified by the 
schedule. 
 Subd. 4. [COOPERATIVE 
AGREEMENTS.] The solicitation process described in this 
chapter is not required for cooperative agreements. The commissioner may enter 
into contracts or accept prices effective for sales to any governmental unit as 
defined in section 471.59, through a cooperative agreement as defined in section 
471.59. 
 Subd. 5. [SPECIFIC PURCHASES.] 
The solicitation process described in this chapter is not 
required for acquisition of the following: 
 (1) merchandise for resale 
purchased under policies determined by the commissioner; 
 (2) farm and garden products 
which, as determined by the commissioner, may be purchased at the prevailing 
market price on the date of sale; 
 (3) goods and services from the 
Minnesota correctional facilities; 
 (4) goods and services from 
rehabilitation facilities and sheltered workshops that are certified by the 
commissioner of economic security; 
 (5) goods and services for use by 
a community-based residential facility operated by the commissioner of human 
services; 
 (6) goods purchased at auction or 
when submitting a sealed bid at auction provided that before authorizing such an 
action, the commissioner consult with the requesting agency to determine a fair 
and reasonable value for the goods considering factors including, but not 
limited to, costs associated with submitting a bid, travel, transportation, and 
storage. This fair and reasonable value must represent the limit of the state's 
bid; and 
 (7) utility services where no 
competition exists or where rates are fixed by law or ordinance. 
 Sec. 12. [16C.12] [COOPERATIVE PURCHASING VENTURE; 
PURCHASING REVOLVING FUND.] 
 The commissioner may enter into 
joint or cooperative purchasing agreements with any entity that is authorized 
under section 471.59 to do so. The cooperative purchasing venture revolving fund 
is a separate account in the state treasury. The commissioner may charge a fee 
to cover the commissioner's administrative expenses to governmental units that 
have joint or cooperative purchasing agreements with the state under section 
471.59. The fees collected must be deposited in the revolving fund established 
by this section. Money in the fund is appropriated to the commissioner to 
administer the programs and services covered by this chapter. 
 Sec. 13. [16C.13] [AGRICULTURAL FOOD PRODUCTS GROWN IN 
STATE.] 
 The commissioner shall encourage 
and make a reasonable attempt to identify and purchase food products that are 
grown in the state. 
 Sec. 14. [16C.14] [CERTAIN VEHICLES.] 
 Upon the written request of the 
commissioner of public safety, motor vehicles for use by investigative and 
undercover agents of the department of public safety may be purchased by the 
brand, make, and model specified by the agency. 
 Sec. 15. [16C.15] [ENERGY EFFICIENCY INSTALLMENT 
PURCHASES.] 
 Subdivision 1. [CONTRACT 
CONDITIONS.] The commissioner may contract to purchase by 
installment payments capital or other equipment or services intended to improve 
the energy efficiency of a state building or facility if: 
 (1) the term of the contract does 
not exceed ten years, with not more than a ten-year payback; 
 (2) the entire cost of the 
contract is a percentage of the resultant savings in energy costs only. "Savings 
in energy cost" means a comparison of energy cost and energy usage under the 
precontract conditions, including reasonable projections of energy cost and 
usage if no change is made to the precontract conditions, against energy cost 
and usage with the changes made under the contract. If it is impractical to 
directly measure energy cost and/or energy usage, reasonable engineering 
estimates may be substituted for measured results; 
 (3) the contract for purchase must 
be completed using a solicitation; 
 (4) the commissioner has 
determined that the contract vendor is a responsible vendor; 
 (5) the contract vendor can 
finance or obtain financing for the performance of the contract without state 
assistance or guarantee; and 
 (6) the state may unilaterally 
cancel the agreement if the legislature fails to appropriate funds to continue 
the contract or if the contractor at any time during the term of the contract 
fails to perform its contractual obligations, including failure to deliver or 
install equipment or materials, failure to replace faulty equipment or materials 
in a timely fashion, and failure to maintain the equipment as agreed in the 
contract. 
 Subd. 2. [ENERGY 
APPROPRIATION.] The commissioner may spend money 
appropriated for energy costs in payment of a contract under this section. 
 Subd. 3. [ENERGY CONSERVATION 
INCENTIVES.] Notwithstanding any other law to the 
contrary, fuel cost savings resulting from energy conservation actions shall be 
available at the managerial level at which the actions took place for 
expenditure for other purposes within the biennium in which the actions occur or 
in the case of a shared savings agreement for the contract period of the shared 
savings agreement. For purposes of this subdivision "shared savings agreement" 
means a contract meeting the terms and conditions of subdivision 1. 
 Subd. 4. [LEGISLATIVE INTENT.] 
The purpose of the energy efficiency installment purchase 
contracts authorized by this section is to save money on energy costs. The 
entire cost of the contract must be a percentage of the resultant savings in 
energy costs. Neither the state nor any agency is liable to make payments on the 
contract except to the extent that there are savings in energy costs that must 
be shared with other parties to the contract. The legislature intends not to 
appropriate any more money to pay for energy costs as a result of these 
contracts than would be payable without them. 
 Sec. 16. [16C.16] [SHELTERED WORKSHOPS AND SERVICES WORK 
ACTIVITY PROGRAMS.] 
 The commissioner, in consultation 
with the commissioner of economic security, shall prepare a list containing 
products and services of state-certified rehabilitation facilities, sheltered 
workshops, and work activity programs for acquisition by state agencies and 
institutions. 
 Sec. 17. [16C.18] [DESIGNATION OF PROCUREMENTS FROM SMALL 
BUSINESSES.] 
 Subdivision 1. [SMALL BUSINESS 
PROCUREMENTS.] The commissioner shall for each fiscal 
year ensure that small businesses receive at least 25 percent of the value of 
anticipated total state procurement of goods and services, including printing 
and construction. The commissioner shall divide the procurements so designated 
into contract award units of economically feasible production runs in order to 
facilitate offers or bids from small businesses. In making the annual 
designation of such procurements the commissioner shall attempt (1) to vary the 
included procurements so that a variety of goods and services produced by 
different small businesses are obtained each year, and (2) to designate small 
business procurements in a manner that will encourage proportional distribution 
of such awards among the geographical regions of the state. To promote the 
geographical distribution of awards, the commissioner may designate a portion of 
the small business procurement for award to bidders from a specified 
congressional district or other geographical region specified by the 
commissioner. The failure of the commissioner to designate particular 
procurements shall not be deemed to prohibit or discourage small businesses from 
seeking the procurement award through the normal process. 
 Subd. 2. [SMALL BUSINESS.] The commissioner shall adopt rules defining "small business" 
for purposes of sections 16C.18 to 16C.23, 137.31, 137.35, 161.321, and 473.142. 
The definition must include only businesses with their principal place of 
business in Minnesota. The definition must establish different size standards 
for various types of businesses. In establishing these standards, the 
commissioner must consider the differences among industries caused by the size 
of the market for goods or services and the relative size and market share of 
the competitors operating in those markets. 
 Subd. 3. [PROFESSIONAL OR 
TECHNICAL PROCUREMENTS.] Every state agency shall for 
each fiscal year designate for awarding to small businesses at least 25 percent 
of the value of anticipated procurements of that agency for professional or 
technical services. The set-aside under this subdivision is in addition to that 
provided by subdivision 1, but must otherwise comply with section 16C.10. 
 Subd. 4. [TARGETED GROUP 
PURCHASING.] The commissioner shall establish a program 
for purchasing goods and services from targeted group businesses, as designated 
in subdivision 5. The purpose of the program is to remedy the effects of past 
discrimination against members of targeted groups. In furtherance of this 
purpose, the commissioner shall attempt to ensure that purchases from targeted 
group businesses reflect a fair and equitable representation of all the state's 
purchasing. 
 Subd. 5. [DESIGNATION OF 
TARGETED GROUPS.] (a) The commissioner of administration 
shall periodically designate businesses that are majority owned and operated by 
women, persons with a substantial physical disability, or specific minorities as 
targeted group businesses within purchasing categories as determined by the 
commissioner. A group may be targeted within a purchasing category if the 
commissioner determines there is a statistical disparity between the percentage 
of purchasing from businesses owned by group members and the representation of 
businesses owned by group members among all businesses in the state in the 
purchasing category. 
 (b) In addition to designations 
under paragraph (a), an individual business may be included as a targeted group 
business if the commissioner determines that inclusion is necessary to remedy 
discrimination against the owner based on race, gender, or disability in 
attempting to operate a business that would provide goods or services to public 
agencies. 
 (c) The designations of purchasing 
categories and businesses under paragraphs (a) and (b) are not rules for 
purposes of chapter 14, and are not subject to rulemaking procedures of that 
chapter. 
 Subd. 6. [PURCHASING METHODS.] 
(a) The commissioner may award up to a six percent 
preference in the amount bid for specified goods or services to small targeted 
group businesses. 
 (b) The commissioner may designate 
a purchase of goods or services for award only to small businesses or small 
targeted group businesses if the commissioner determines that at least three 
small businesses or small targeted group businesses are likely to bid. 
 (c) The commissioner, as a 
condition of awarding a construction contract or approving a contract for 
professional or technical services, may set goals that require the prime 
contractor to subcontract a portion of the contract to small businesses or small 
targeted group businesses. The commissioner must establish a procedure for 
granting waivers from the subcontracting requirement when qualified small 
businesses or small targeted group businesses are not reasonably available. The 
commissioner may establish financial incentives for prime contractors who exceed 
the goals for use of small business or small targeted group business 
subcontractors and financial penalties for prime contractors who fail to meet 
goals under this paragraph. The subcontracting requirements of this paragraph do 
not apply to prime contractors who are small businesses or small targeted group 
businesses. 
 Subd. 7. [ECONOMICALLY 
DISADVANTAGED AREAS.] The commissioner may award up to a 
four percent preference in the amount bid on state procurement to small 
businesses located in an economically disadvantaged area. A business is located 
in an economically disadvantaged area if: 
 (1) the owner resides in or the 
business is located in a county in which the median income for married couples 
is less than 70 percent of the state median income for married couples; 
 (2) the owner resides in or the 
business is located in an area designated a labor surplus area by the United 
States Department of Labor; or 
 (3) the business is a 
rehabilitation facility or work activity program. 
 The commissioner may designate one 
or more areas designated as targeted neighborhoods under section 469.202 or as 
enterprise zones under section 469.167 as economically disadvantaged areas for 
purposes of this subdivision if the commissioner determines that this 
designation would further the purposes of this section. If the owner of a small 
business resides or is employed in a designated area, the small business is 
eligible for any preference provided under this subdivision. 
 The department of revenue shall 
gather data necessary to make the determinations required by clause (1), and 
shall annually certify counties that qualify under clause (1). An area 
designated a labor surplus area retains that status for 120 days after certified 
small businesses in the area are notified of the termination of the designation 
by the United States Department of Labor. 
 Subd. 8. [SURETY BONDS.] Surety bonds guaranteed by the federal Small Business 
Administration and second party bonds are acceptable security for a construction 
award under this section. "Second party bond" means a bond that designates as 
principal, guarantor, or both, a person or persons in addition to the person to 
whom the contract is proposed for award. 
 Subd. 9. [DETERMINATION OF 
ABILITY TO PERFORM.] Before making an award under the 
preference programs established in subdivisions 4 to 7, the commissioner shall 
evaluate whether the small business or small targeted group business scheduled 
to receive the award is able to perform the contract. This determination shall 
include consideration of production and financial capacity and technical 
competence. 
 Subd. 10. [LIMITS.] At least 75 percent of the value of the subcontracts awarded 
to small businesses or small targeted group businesses under subdivision 6, 
paragraph (c), must be performed by the business to which the subcontract is 
awarded or by another small business or small targeted group business. 
 Subd. 11. [PROCUREMENT 
PROCEDURES.] All laws and rules pertaining to 
solicitations, bid evaluations, contract awards, and other procurement matters 
apply equally to procurements designated for small businesses or small targeted 
group businesses. In the event of conflict with other rules, section 16C.16 and 
rules adopted under it govern, if section 16C.16 applies. If it does not apply, 
sections 16C.18 to 16C.23 and rules adopted under those sections govern. 
 Subd. 12. [APPLICABILITY.] This section does not apply to construction contracts or 
contracts for professional or technical services under section 16C.09 that are 
financed in whole or in part with federal funds and that are subject to federal 
disadvantaged business enterprise regulations. 
 Sec. 18. [16C.19] [ENCOURAGEMENT OF PARTICIPATION; 
ADVISORY COUNCIL.] 
 Subdivision 1. [COMMISSIONER 
OF ADMINISTRATION.] The commissioners of administration 
and trade and economic development shall publicize the provisions of the 
purchasing programs in sections 16C.18 to 16C.23, attempt to locate small 
businesses or small targeted group businesses able to perform under the 
programs, and encourage participation through education, technical assistance, 
mentoring, and other means. When the commissioner of administration determines 
that a small business or small targeted group business is unable to perform 
under a program established in sections 16C.18 to 16C.23, the commissioner shall 
inform the commissioner of trade and economic development who shall assist the 
small business or small targeted group business in attempting to remedy the 
causes of the inability to perform the award. In assisting the small business or 
small targeted group business, the commissioner of trade and economic 
development in cooperation with the commissioner of administration shall use 
management or financial assistance programs made available by or through the 
department of trade and economic development, other state or governmental 
agencies, or private sources. 
 Subd. 2. [ADVISORY COUNCIL.] 
The small business procurement advisory council consists 
of 13 members appointed by the commissioner of administration. A chair of the 
advisory council shall be elected from among the members. The appointments are 
subject to the appointments program provided by section 15.0597. The terms, 
compensation, and removal of members are as provided in section 15.059. 
 Subd. 3. [DUTIES.] The small business procurement advisory council shall: 
 (1) advise the commissioner of 
administration on matters relating to the small business and small targeted 
group business procurement program; 
 (2) review complaints or 
grievances from small businesses and small targeted group businesses who are 
doing or attempting to do business under the program; and 
 (3) review the reports of the 
commissioners of administration and trade and economic development provided by 
section 16C.20 to ensure compliance with the goals of the program. 
 Sec. 19. [16C.20] [REPORTS.] 
 Subdivision 1. [COMMISSIONER 
OF ADMINISTRATION.] The commissioner shall submit an 
annual report pursuant to section 3.195 to the governor and the legislature with 
a copy to the commissioner of trade and economic development indicating the 
progress being made toward the objectives and goals of sections 16C.18 to 
16C.23, 161.321, and 473.142 during the preceding fiscal year. 
 Subd. 2. [COMMISSIONER OF 
TRADE AND ECONOMIC DEVELOPMENT.] The commissioner of 
trade and economic development shall submit an annual report to the governor and 
the legislature pursuant to section 3.195 with a copy to the commissioner of 
administration. This report shall include the following information: 
 (1) the efforts undertaken to 
publicize the provisions of the small business and small targeted group business 
procurement program during the preceding fiscal year; 
 (2) the efforts undertaken to 
identify small businesses and small targeted group businesses and the efforts 
undertaken to encourage participation in the targeted group purchasing 
program; 
 (3) the efforts undertaken by the 
commissioner to remedy the inability of small businesses and small targeted 
group businesses to perform on potential awards; and 
 (4) the commissioner's 
recommendations for strengthening the small business and small targeted group 
business procurement program and delivery of services to small businesses. 
 Subd. 3. [REPORTS FROM OTHER 
AGENCIES.] The commissioner of transportation, and each 
metropolitan agency listed in section 473.143, subdivision 1, shall report to 
the commissioner of administration all information that the commissioner 
requests to make reports required under this section. The information must be 
reported at the time and in the manner requested by the commissioner of 
administration. 
 Sec. 20. [16C.21] [ELIGIBILITY; RULES.] 
 (a) A small business wishing to 
participate in the programs under section 16C.18, subdivisions 4 to 7, must be 
certified by the commissioner. The commissioner shall adopt by rule standards 
and procedures for certifying that small businesses, small targeted group 
businesses, and small businesses located in economically disadvantaged areas are 
eligible to participate under the requirements of sections 16C.18 to 16C.23. The 
commissioner shall adopt by rule standards and procedures for hearing appeals 
and grievances and other rules necessary to carry out the duties set forth in 
sections 16C.18 to 16C.23. 
 (b) The commissioner may make 
rules which exclude or limit the participation of nonmanufacturing business, 
including third-party lessors, brokers, franchises, jobbers, manufacturers' 
representatives, and others from eligibility under sections 16C.18 to 
16C.23. 
 (c) The commissioner may make 
rules that set time limits and other eligibility limits on business 
participation in programs under sections 16C.18 to 16C.23. 
 Sec. 21. [16C.22] [CERTIFICATION.] 
 A business that is certified by 
the commissioner of administration as a small business, small targeted group 
business or a small business located in an economically disadvantaged area is 
eligible to participate under the requirements of sections 137.31 and 161.321 
and, if certified as a small business or small targeted group business, under 
section 473.142 without further certification by the contracting agency. 
 Sec. 22. [16C.23] [CRIMINAL PENALTY.] 
 A person who knowingly provides 
false information to a public official or employee for the purpose of obtaining 
or retaining certification as a small targeted group business or a small 
business located in an economically disadvantaged area under sections 16C.18 to 
16C.22, 137.31, 137.35, 161.321, or 473.142 is guilty of a misdemeanor. 
 Sec. 23. [16C.24] [DISTRICT HEATING.] 
 Notwithstanding any other law, 
general or special, the commissioner is authorized to enter into or approve a 
written agreement not to exceed 31 years with a district heating utility that 
will specify, but not be limited to, the appropriate terms and conditions for 
the interchange of district heating services. 
 Sec. 24. [16C.25] [SURPLUS PROPERTY ACQUISITION, 
DISTRIBUTION, AND DISPOSAL.] 
 Subdivision 1. [DEFINITIONS.] 
"Governmental unit or nonprofit organization" means a 
governmental unit as defined in section 471.59, subdivision 1, an Indian tribal 
government, and any nonprofit and tax-exempt medical institution, hospital, 
clinic, health center, school, school system, college, university, or other 
institution organized and existing for any purpose authorized by federal law to 
accept surplus federal property. 
 Subd. 2. [SURPLUS PROPERTY.] 
"Surplus property" means state or federal commodities, 
equipment, materials, supplies, books, printed matter, buildings, and other 
personal or real property that is obsolete, unused, not needed for a public 
purpose, or ineffective for current use. 
 Subd. 3. [AUTHORIZATION.] (a) The commissioner is the state agency designated to 
transfer, purchase, accept, sell, or dispose of surplus property for the state 
and for the benefit of any other governmental unit or nonprofit organization for 
any purpose authorized by state and federal law and in accordance with state and 
federal rules and regulations. Any governmental unit or nonprofit organization 
may designate the commissioner to purchase or accept surplus property for it 
upon mutually agreeable terms and conditions. The commissioner may acquire, 
accept, warehouse, and distribute surplus property and charge a fee to cover any 
expenses incurred in connection with any of these acts. 
 (b) Federal surplus property that 
has been transferred to the state for donation to public agencies and nonprofit 
organizations must be transferred or sold in accordance with the plan developed 
under paragraph (c). Expenses incurred in connection with the acquisition, 
warehousing, distribution, and disposal of federal surplus property must be paid 
from the surplus services revolving fund. Proceeds of sales, minus any expenses, 
must be deposited in the surplus services revolving fund. 
 (c) The commissioner shall develop 
a detailed plan for disposal of donated federal property in conformance with 
state law and federal regulations. The plan must be submitted to the governor 
for certification and submission to the federal administrator of general 
services. 
 (d) The commissioner, after 
consultation with one or more nonprofit organizations with an interest in 
providing housing for homeless veterans and their families, may acquire property 
from the United States government that is designated by the General Services 
Administration as surplus property. The commissioner may lease the property to a 
qualified nonprofit organization that agrees to develop or rehabilitate the 
property for the purpose of providing suitable housing for veterans and their 
families. The lease agreement with the nonprofit organization may require that 
the property be developed for use as housing for homeless and displaced veterans 
and their families and for veterans and their families who lose their 
housing. 
 Subd. 4. [DEPOSIT OF 
RECEIPTS.] The surplus services revolving fund is a 
separate fund in the state treasury. All money resulting from the acquisition, 
acceptance, warehousing, distribution, and public sale of surplus property, must 
be deposited in the fund. Money paid into the surplus services revolving fund is 
appropriated to the commissioner for the purposes of the programs and services 
referred to in this section. 
 Subd. 5. [TRANSFER OR SALE.] 
(a) When the state or an agency operating under a 
legislative appropriation obtains surplus property from the commissioner, the 
commissioner of finance must, at the commissioner's request, transfer the cost 
of the surplus property, including any expenses of acquiring, accepting, 
warehousing, and distributing the surplus property, from the appropriation of 
the agency receiving the surplus property to the surplus services revolving 
fund. The determination of the commissioner is final as to the cost of the 
surplus property to the agency receiving the property. 
 (b) When any governmental unit or 
nonprofit organization other than an agency receives surplus property from the 
commissioner, the governmental unit or nonprofit organization must reimburse the 
surplus services revolving fund for the cost of the property, including the 
expenses of acquiring, accepting, warehousing, and distributing it, in an amount 
the commissioner sets. The commissioner may, however, require the governmental 
unit or nonprofit organization to deposit in advance in the surplus services 
revolving fund the cost of the surplus property upon mutually agreeable terms 
and conditions. 
 (c) The commissioner may transfer 
or sell state surplus property to any person at public auction, at prepriced 
sale, or by sealed bid process in accordance with applicable state laws. 
 Subd. 6. [STATE SURPLUS 
PROPERTY.] The commissioner may do any of the following 
to dispose of state surplus property: 
 (1) transfer it to or between 
state agencies; 
 (2) transfer it to a governmental 
unit or nonprofit organization in Minnesota; or 
 (3) sell it and charge a fee to 
cover expenses incurred by the commissioner in the disposal of the surplus 
property. 
 The proceeds of the sale less the 
fee are appropriated to the agency for whose account the sale was made, to be 
used and expended by that agency to purchase similar state property. 
 Subd. 7. [GIFTS.] The commissioner is authorized to solicit and accept donated 
money and fixed and consumable property for the benefit of the state and any 
other governmental unit or nonprofit organization for any purpose authorized by 
state and federal law and in accordance with federal regulations and rules. The 
gift acceptance procedures of sections 7.09 to 7.12 do not apply to this 
subdivision. 
 Sec. 25. [16C.26] [RULES.] 
 Minnesota Rules, parts 1230.0100 
to 1230.4300, adopted under chapter 16B, govern under this chapter. In the event 
rules adopted under chapter 16B conflict with provisions of this chapter, this 
chapter shall govern. 
 Sec. 26. [174.18] [ADVERTISEMENT OF HIGHWAY CONTRACTS.] 
 Notwithstanding anything in 
chapter 16C to the contrary, all contracts for the repair, improvement, 
maintenance, or construction of highways or highway bridges must be advertised 
and let as provided by law for highway construction contracts. 
 Sec. 27. Minnesota Statutes 1997 Supplement, section 
363.073, subdivision 1, is amended to read: 
 Subdivision 1. [SCOPE OF APPLICATION.]  the commissioner of human rights. Receipt of a 
certificate of compliance issued by the commissioner shall signify that a firm 
or business has an affirmative action plan that has been approved by the 
commissioner. A certificate shall be valid for a period of two years. A 
municipality as defined in section 466.01, subdivision 1, that receives state 
money for any reason is encouraged to prepare and implement an affirmative 
action plan for the employment of minority persons, women, and the qualified disabled and submit the plan to the 
commissioner of human rights. 
 (b) This paragraph applies to a 
contract for goods or services in excess of $100,000 to be entered into between 
a department or agency of the state, and a business that is not subject to 
paragraph (a), but that has more than 40 full-time employees on a single working 
day during the previous 12 months in the state where the business has its 
primary place of business. A department or agency of the state may not execute a 
contract or agreement with such a business unless the business has a certificate 
of compliance issued by the commissioner under paragraph (a) or the business 
certifies to the contracting agency: (1) that it is in compliance with any 
affirmative action plan requirements in the jurisdiction of its primary place of 
business; or (2) that the jurisdiction of its primary place of business does not 
have an affirmative action plan requirement. 
 Sec. 28. [REPORT.] 
 The commissioner of administration 
shall report to the legislature by January 1, 1999, in the biennial report 
required under Minnesota Statutes, section 115A.15, subdivision 5, on the 
potential use of measurable objectives as a means of tracking progress toward 
the purchase of recycled content goods. 
 Sec. 29. [REPEALER.] 
 Minnesota Statutes 1996, sections 
16B.06; 16B.07; 16B.08; 16B.09; 16B.101; 16B.102; 16B.103; 16B.123; 16B.13; 
16B.14; 16B.15; 16B.16; 16B.167; 16B.17; 16B.175; 16B.18, subdivisions 1, 2, and 
4; 16B.185; 16B.19; 16B.20, subdivisions 1 and 3; 16B.21; 16B.22; 16B.226; 
16B.227; 16B.23; 16B.28; 16B.29; and 16B.89; and Minnesota Statutes 1997 
Supplement, sections 16B.18, subdivision 3; 16B.20, subdivision 2; and 16B.482, 
are repealed. 
 Sec. 30. [EFFECTIVE DATE.] 
 This article is effective July 1, 
1998. 
 
 
 Section 1. Minnesota Statutes 1997 Supplement, section 
3.225, subdivision 1, is amended to read: 
 Subdivision 1. [APPLICATION.] This section applies to a 
contract for professional or technical services entered into by the house of 
representatives, the senate, the legislative coordinating commission, or any 
group under the jurisdiction of the legislative coordinating commission. For 
purposes of this section, "professional or technical services" has the meaning 
defined in section  Sec. 2. Minnesota Statutes 1996, section 3.225, 
subdivision 2, is amended to read: 
 Subd. 2. [REQUIREMENTS FOR ALL CONTRACTS.] Before 
entering into a contract for professional or technical services, the contracting 
entity must determine that: 
 (1) all provisions of section  (2) the work to be performed under the contract is 
necessary to the entity's achievement of its responsibilities; 
 (3) the contract will not establish an employment 
relationship between the state or the entity and any persons performing under 
the contract; 
 (4) no current legislative employees will engage in the 
performance of the contract; 
 (5) no state agency has previously performed or 
contracted for the performance of tasks which would be substantially duplicated 
under the proposed contract; 
 (6) the contracting entity has specified a satisfactory 
method of evaluating and using the results of the work to be performed; and 
 (7) the combined contract and amendments will not extend 
for more than five years. 
 Sec. 3. Minnesota Statutes 1996, section 3.732, 
subdivision 6, is amended to read: 
 Subd. 6. [SETTLEMENT.] The head of each department or 
agency, or a designee, acting on behalf of the state, may enter into structured 
settlements, through the negotiation, creation, and use of annuities or similar 
financial plans for claimants, to resolve claims arising from the alleged 
negligence of the state, its agencies, or employees. Sections  Sec. 4. Minnesota Statutes 1996, section 3.922, 
subdivision 5, is amended to read: 
 Subd. 5. [OFFICERS; PERSONNEL; AUTHORITY.] The council 
shall annually elect a chair and other officers as it may deem necessary. The 
chair may appoint subcommittees necessary to fulfill the duties of the council. 
It shall also employ and prescribe the duties of employees and agents as it 
deems necessary. The compensation of the executive director of the board is as 
provided by section 43A.18. All employees are in the unclassified service. The 
chair is an ex officio member of the state board of human rights. Appropriations 
and other funds of the council are subject to chapter  Sec. 5. Minnesota Statutes 1996, section 3C.10, 
subdivision 3, is amended to read: 
 Subd. 3. [NEGOTIATED CONTRACTS.] The revisor's office may 
negotiate for all or part of the editing, indexing, compiling, and printing of 
Minnesota Statutes, supplements to Minnesota Statutes, and Laws of Minnesota and 
contract with a law book publisher for these services. The provisions of chapter 
 Sec. 6. Minnesota Statutes 1996, section 4A.04, is 
amended to read: 
 4A.04 [COOPERATIVE CONTRACTS.] 
 (a) The director may apply for, receive, and expend money 
from municipal, county, regional, and other planning agencies; apply for, 
accept, and disburse grants and other aids for planning purposes from the 
federal government and from other public or private sources; and may enter into 
contracts with agencies of the federal government, local governmental units, the 
University of Minnesota, and other educational institutions, and private persons 
as necessary to perform the director's duties. Contracts made pursuant to this 
section are not subject to the provisions of chapter  (b) The director may apply for, receive, and expend money 
made available from federal sources or other sources for the purposes of 
carrying out the duties and responsibilities of the director relating to local 
and urban affairs. 
 (c) All money received by the director pursuant to this 
section shall be deposited in the state treasury and is appropriated to the 
director for the purposes for which the money has been received. The money shall 
not cancel and is available until expended. 
 Sec. 7. Minnesota Statutes 1996, section 6.551, is 
amended to read: 
 6.551 [EXAMINATION OF GRANTEES AND CONTRACTORS OF LOCAL 
GOVERNMENTS.] 
 The state auditor may examine the books, records, 
documents, and accounting procedures and practices of a contractor or grantee of 
a local government pursuant to section  Sec. 8. Minnesota Statutes 1996, section 11A.24, 
subdivision 4, is amended to read: 
 Subd. 4. [OTHER OBLIGATIONS.] (a) The state board may 
invest funds in bankers acceptances, certificates of deposit, deposit notes, 
commercial paper, mortgage securities and asset backed securities, repurchase 
agreements and reverse repurchase agreements, guaranteed investment contracts, 
savings accounts, and guaranty fund certificates, surplus notes, or debentures 
of domestic mutual insurance companies if they conform to the following 
provisions: 
 (1) bankers acceptances and deposit notes of United 
States banks are limited to those issued by banks rated in the highest four 
quality categories by a nationally recognized rating agency; 
 (2) certificates of deposit are limited to those issued 
by (i) United States banks and savings institutions that are rated in the top 
four quality categories by a nationally recognized rating agency or whose 
certificates of deposit are fully insured by federal agencies; or (ii) credit 
unions in amounts up to the limit of insurance coverage provided by the National 
Credit Union Administration; 
 (3) commercial paper is limited to those issued by United 
States corporations or their Canadian subsidiaries and rated in the highest two 
quality categories by a nationally recognized rating agency; 
 (4) mortgage securities shall be rated in the top four 
quality categories by a nationally recognized rating agency; 
 (5) collateral for repurchase agreements and reverse 
repurchase agreements is limited to letters of credit and securities authorized 
in this section; 
 (6) guaranteed investment contracts are limited to those 
issued by insurance companies or banks rated in the top four quality categories 
by a nationally recognized rating agency or to alternative guaranteed investment 
contracts where the underlying assets comply with the requirements of this 
section; 
 (7) savings accounts are limited to those fully insured 
by federal agencies; and 
 (8) asset backed securities shall be rated in the top 
four quality categories by a nationally recognized rating agency. 
 (b) Sections 16A.58  (c) In addition to investments authorized by paragraph 
(a), clause (4), the state board may purchase from the Minnesota housing finance 
agency all or any part of a pool of residential mortgages, not in default, that 
has previously been financed by the issuance of bonds or notes of the agency. 
The state board may also enter into a commitment with the agency, at the time of 
any issue of bonds or notes, to purchase at a specified future date, not 
exceeding 12 years from the date of the issue, the amount of mortgage loans then 
outstanding and not in default that have been made or purchased from the 
proceeds of the bonds or notes. The state board may charge reasonable fees for 
any such commitment and may agree to purchase the mortgage loans at a price 
sufficient to produce a yield to the state board comparable, in its judgment, to 
the yield available on similar mortgage loans at the date of the bonds or notes. 
The state board may also enter into agreements with the agency for the 
investment of any portion of the funds of the agency. The agreement must cover 
the period of the investment, withdrawal privileges, and any guaranteed rate of 
return. 
 Sec. 9. Minnesota Statutes 1996, section 12.221, 
subdivision 5, is amended to read: 
 Subd. 5. [REQUIREMENTS WAIVED.] Pursuant to any 
federal-state agreement entered into by the state director, serving as the 
governor's authorized representative, in the acceptance of federal money made 
available as a result of a disaster declaration, and upon the review and 
acceptance by the attorney general's office of the language contained in the 
subgrant agreement and any amendments to the agreement, the requirements of 
section  Sec. 10. Minnesota Statutes 1996, section 15.061, is 
amended to read: 
 15.061 [PROFESSIONAL OR TECHNICAL SERVICES.] 
 In accordance with  Sec. 11. Minnesota Statutes 1996, section 16A.101, is 
amended to read: 
 16A.101 [SERVICE CONTRACTS.] 
 The state accounting system must list expenditures for 
professional and technical service contracts, as defined in section  Sec. 12. Minnesota Statutes 1997 Supplement, section 
16A.15, subdivision 3, is amended to read: 
 Subd. 3. [ALLOTMENT AND ENCUMBRANCE.] (a) A payment may 
not be made without prior obligation. An obligation may not be incurred against 
any fund, allotment, or appropriation unless the commissioner has certified a 
sufficient unencumbered balance or the accounting system shows sufficient 
allotment or encumbrance balance in the fund, allotment, or appropriation to 
meet it. The commissioner shall determine when the accounting system may be used 
to incur obligations without the commissioner's certification of a sufficient 
unencumbered balance. An expenditure or obligation authorized or incurred in 
violation of this chapter is invalid and ineligible for payment until made 
valid. A payment made in violation of this chapter is illegal. An employee 
authorizing or making the payment, or taking part in it, and a person receiving 
any part of the payment, are jointly and severally liable to the state for the 
amount paid or received. If an employee knowingly incurs an obligation or 
authorizes or makes an expenditure in violation of this chapter or takes part in 
the violation, the violation is just cause for the employee's removal by the 
appointing authority or by the governor if an appointing authority other than 
the governor fails to do so. In the latter case, the governor shall give notice 
of the violation and an opportunity to be heard on it to the employee and to the 
appointing authority. A claim presented against an appropriation without prior 
allotment or encumbrance may be made valid on investigation, review, and 
approval by the agency head in accordance with the commissioner's policy, if the 
services, materials, or supplies to be paid for were actually furnished in good 
faith without collusion and without intent to defraud. The commissioner may then 
draw a warrant to pay the claim just as properly allotted and encumbered claims 
are paid. 
 (b) The commissioner may approve payment for materials 
and supplies in excess of the obligation amount when increases are authorized by 
section  (c) To minimize potential construction delay claims, an 
agency with a project funded by a building appropriation may allow a contractor 
to proceed with supplemental work within the limits of the appropriation before 
money is encumbered. Under this circumstance, the agency may requisition funds 
and allow contractors to expeditiously proceed with a construction sequence. 
While the contractor is proceeding, the agency shall immediately act to encumber 
the required funds. 
 Sec. 13. Minnesota Statutes 1996, section 16A.85, 
subdivision 1, is amended to read: 
 Subdivision 1. [AUTHORIZATION.] The commissioner of 
administration may determine, in conjunction with the commissioner of finance, 
the personal property needs of the various state departments, agencies, boards, 
commissions and the legislature of the kinds of property identified in this 
subdivision that may be economically funded through a master lease program and 
request the commissioner of finance to execute a master lease. The master lease 
may be used only to finance the following kinds of purchases: 
 (a) The master lease may be used to finance purchases by 
the commissioner of administration with money from an internal services fund. 
 (b) The master lease may be used to refinance a purchase 
of equipment already purchased under a lease-purchase agreement. 
 (c) The master lease may be used to finance purchases of 
large equipment with a capital value of more than $100,000 and a useful life of 
more than ten years. 
 (d) The legislature may specifically authorize a 
particular purchase to be financed using the master lease. The legislature 
anticipates that this authorization will be given only to finance the purchase 
of major pieces of equipment with a capital value of more than $10,000. 
 The commissioner of finance may authorize the sale and 
issuance of certificates of participation relative to a master lease in an 
amount sufficient to fund these personal property needs. The term of the 
certificates must be less than the expected useful life of the equipment whose 
purchase is financed by the certificates. The commissioner of administration may 
use the proceeds from the master lease or the sale of the certificates of 
participation to acquire the personal property through the appropriate 
procurement procedure in chapter  Sec. 14. Minnesota Statutes 1997 Supplement, section 
16B.465, subdivision 7, is amended to read: 
 Subd. 7. [EXEMPTION.] The system is exempt from the 
five-year limitation on contracts set by  Sec. 15. Minnesota Statutes 1997 Supplement, section 
16E.07, subdivision 9, is amended to read: 
 Subd. 9. [AGGREGATION OF SERVICE DEMAND.] The office 
shall identify opportunities to aggregate demand for technical services required 
by government units for online activities and may contract with governmental or 
nongovernmental entities to provide services. These contracts are not subject to 
the requirements of  Sec. 16. Minnesota Statutes 1997 Supplement, section 
17.03, subdivision 12, is amended to read: 
 Subd. 12. [CONTRACTS; APPROPRIATION.] The commissioner 
may accept money as part of a contract with any public or private entity to 
provide statutorily prescribed services by the department. A contract must 
specify the services to be provided by the department and the amount and method 
of reimbursement. Money generated in a contractual agreement under this section 
must be deposited in a special revenue fund and is appropriated to the 
department for purposes of providing services specified in the contracts. 
Contracts under this section must be processed in accordance with section  Sec. 17. Minnesota Statutes 1996, section 17.1015, is 
amended to read: 
 17.1015 [PROMOTIONAL EXPENDITURES.] 
 In order to accomplish the purposes of section 17.101, 
the commissioner may participate jointly with private persons in appropriate 
programs and projects and may enter into contracts to carry out those programs 
and projects. The contracts may not include the acquisition of land or buildings 
and are not subject to the provisions of chapter  The commissioner may spend money appropriated for the 
purposes of section 17.101, and expenditures made pursuant to section 17.101 for 
food, lodging, or travel are not governed by the travel rules of the 
commissioner of employee relations. 
 Sec. 18. Minnesota Statutes 1996, section 41A.023, is 
amended to read: 
 41A.023 [POWERS.] 
 In addition to other powers granted by this chapter, the 
board may: 
 (1) sue and be sued; 
 (2) acquire, hold, lease, and transfer any interest in 
real and personal property for its corporate purposes; 
 (3) sell at public or private sale, at the price or 
prices determined by the board, any note, mortgage, lease, sublease, lease 
purchase, or other instrument or obligation evidencing or securing a loan made 
for the purpose of economic development, job creation, redevelopment, or 
community revitalization by a public agency to a business, for-profit or 
nonprofit organization, or an individual; 
 (4) obtain insurance on its property; 
 (5) obtain municipal bond insurance, letters of credit, 
surety obligations, or similar agreements from financial institutions; 
 (6) enter into other agreements or transactions, without 
regard to chapter 16B or 16C, that the board 
considers necessary or appropriate to carry out the purposes of this chapter 
with federal or state agencies, political subdivisions of the state, or other 
persons, firms, or corporations; 
 (7) establish and collect fees without regard to chapter 
14 and section 16A.1285; 
 (8) accept appropriations, gifts, grants, and bequests; 
 (9) use money received from any source for any legal 
purpose or program of the board; 
 (10) participate in loans for agricultural resource 
projects in accordance with section 41A.035; 
 (11) provide small business development loans in 
accordance with section 41A.036; and 
 (12) guarantee or insure bonds or notes issued by the 
board. 
 Sec. 19. Minnesota Statutes 1997 Supplement, section 
41D.03, subdivision 7, is amended to read: 
 Subd. 7. [PURCHASING INSTRUCTIONAL ITEMS.] Technical 
educational equipment may be procured for programs of the Minnesota center for 
agriculture education by the council either by brand designation or in 
accordance with standards and specifications the council may adopt, 
notwithstanding chapter  Sec. 20. Minnesota Statutes 1996, section 43A.23, 
subdivision 1, is amended to read: 
 Subdivision 1. [GENERAL.] The commissioner is authorized 
to request bids from carriers or to negotiate with carriers and to enter into 
contracts with carriers which in the judgment of the commissioner are best 
qualified to underwrite and service the benefit plans. Contracts entered into 
with carriers are not subject to the requirements of sections  Sec. 21. Minnesota Statutes 1996, section 44A.01, 
subdivision 1, is amended to read: 
 Subdivision 1. [ESTABLISHMENT.] The Minnesota world trade 
center corporation is a public corporation established to facilitate and support 
Minnesota world trade center programs and services and to promote the Minnesota 
world trade center. The corporation is a state agency, but is not subject to 
chapters 14, 16A, 16B, 16C, 43A, and 179A. 
 Sec. 22. Minnesota Statutes 1996, section 45.0291, is 
amended to read: 
 45.0291 [DEPARTMENT BONDS.] 
 Bonds issued under chapters 45 to 83, 309, 332, and 
sections 326.83 to 326.98, are not state bonds or contracts for purposes of 
sections 8.05 and  Sec. 23. Minnesota Statutes 1997 Supplement, section 
61B.21, subdivision 1, is amended to read: 
 Subdivision 1. [FUNCTIONS.] The Minnesota life and health 
insurance guaranty association shall perform its functions under the plan of 
operation established and approved under section 61B.25, and shall exercise its 
powers through a board of directors. The association is not a state agency for 
purposes of chapter 16A, 16B, 16C, or 43A. For 
purposes of administration and assessment, the association shall establish and 
maintain two accounts: 
 (1) the life insurance and annuity account which includes 
the following subaccounts: 
 (i) the life insurance account; 
 (ii) the annuity account; and 
 (iii) the unallocated annuity account; and 
 (2) the health insurance account. 
 Sec. 24. Minnesota Statutes 1996, section 84.025, 
subdivision 7, is amended to read: 
 Subd. 7. [CONTRACTS.] The commissioner of natural 
resources may contract with the federal government, local governmental units, 
the University of Minnesota, and other educational institutions, and private 
persons as may be necessary in the performance of duties. Contracts made 
pursuant to this section for professional services shall not be subject to the 
provisions of chapter  Sec. 25. Minnesota Statutes 1996, section 84.026, is 
amended to read: 
 84.026 [CONTRACTS FOR PROVISION OF NATURAL RESOURCES 
SERVICES.] 
 The commissioner of natural resources is authorized to 
enter into contractual agreements with any public or private entity for the 
provision of statutorily prescribed natural resources services by the 
department. The contracts shall specify the services to be provided and the 
amount and method of reimbursement. Funds generated in a contractual agreement 
made pursuant to this section shall be deposited in the special revenue fund and 
are appropriated to the department for purposes of providing the services 
specified in the contracts. All such contractual agreements shall be processed 
in accordance with the provisions of section  Sec. 26. Minnesota Statutes 1996, section 84.0845, is 
amended to read: 
 84.0845 [ADVANCE OF MATCHING FUNDS.] 
 The commissioner may advance funds appropriated for fish 
and wildlife programs to government agencies, the National Fish and Wildlife 
Foundation, federally recognized Indian tribes and bands, and private, nonprofit 
organizations for the purposes of securing nonstate matching funds for projects 
involving acquisition and improvement of fish and wildlife habitat and related 
research and management. The commissioner shall execute agreements for contracts 
with the matching parties under  Sec. 27. Minnesota Statutes 1996, section 85A.02, 
subdivision 3, is amended to read: 
 Subd. 3. The board may conduct research studies and 
programs, collect and analyze data and prepare reports, maps, charts and other 
information relating to the zoological garden or any wild or domestic animals or 
may contract for any of such services without complying with chapter  Sec. 28. Minnesota Statutes 1997 Supplement, section 
85A.02, subdivision 5b, is amended to read: 
 Subd. 5b. [EXEMPTIONS.] The board is not subject to 
sections 3.841 to 3.845, 15.057, 15.061, 16A.1285, and 16A.28;  Sec. 29. Minnesota Statutes 1996, section 85A.02, 
subdivision 16, is amended to read: 
 Subd. 16. The board may acquire by lease-purchase or 
installment purchase contract, transportation systems, facilities and equipment 
that it determines will substantially enhance the public's opportunity to view, 
study or derive information concerning the animals to be located in the 
zoological garden, and will increase attendance at the garden. The contracts may 
provide for: (1) the payment of money over a 12-year period, or over a longer 
period not exceeding 25 years if approved by the board; (2) the payment of money 
from any funds of the board not pledged or appropriated for another purpose; (3) 
indemnification of the lessor or seller for damage to property or injury to 
persons due primarily to the actions of the board or its employees; (4) the 
transfer of title to the property to the board upon execution of the contract or 
upon payment of specified amounts; (5) the reservation to the lessor or seller 
of a security interest in the property; and (6) any other terms that the board 
determines to be commercially reasonable. Property so acquired by the board, and 
its purchase or use by the board, or by any nonprofit corporation having a 
concession from the board requiring its purchase, shall not be subject to 
taxation by the state or its political subdivisions. Each contract shall be 
subject to the provisions of chapter  Sec. 30. Minnesota Statutes 1996, section 85A.02, 
subdivision 18, is amended to read: 
 Subd. 18. [PURCHASING.] The board may contract for 
supplies, materials, purchase or rental of equipment, and utility services. 
Except as provided in subdivision 5b, chapter  Sec. 31. Minnesota Statutes 1996, section 103F.515, 
subdivision 3, is amended to read: 
 Subd. 3. [CONSERVATION EASEMENTS.] (a) The board may 
acquire, or accept by gift or donation, conservation easements on eligible land. 
An easement may be permanent or of limited duration. An easement acquired on 
land for windbreak purposes, under subdivision 2, may be only of permanent 
duration. An easement of limited duration may not be acquired if it is for a 
period less than 20 years. The negotiation and acquisition of easements 
authorized by this section are exempt from the contractual provisions of  (b) The board may acquire, or accept by gift or donation, 
flowage easements when necessary for completion of wetland restoration projects. 
 Sec. 32. Minnesota Statutes 1996, section 116.03, 
subdivision 2, is amended to read: 
 Subd. 2. The commissioner shall organize the agency and 
employ such assistants and other officers, employees and agents as the 
commissioner may deem necessary to discharge the functions of the commissioner's 
office, define the duties of such officers, employees and agents, and delegate 
to them any of the commissioner's powers, duties, and responsibilities, subject 
to the commissioner's control and under such conditions as the commissioner may 
prescribe. The commissioner may also contract with persons, firms, corporations, 
the federal government and any agency or instrumentality thereof, the water 
research center of the University of Minnesota or any other instrumentality of 
such university, for doing any of the work of the commissioner's office, and 
none of the provisions of chapter  Sec. 33. Minnesota Statutes 1996, section 116J.035, 
subdivision 1, is amended to read: 
 Subdivision 1. [POWERS.] The commissioner may: 
 (a) apply for, receive, and expend money from municipal, 
county, regional, and other government agencies; 
 (b) apply for, accept, and disburse grants and other aids 
from other public or private sources; 
 (c) contract for professional services if such work or 
services cannot be satisfactorily performed by employees of the department or by 
any other state agency; 
 (d) enter into interstate compacts to jointly carry out 
such research and planning with other states or the federal government where 
appropriate; 
 (e) distribute informational material at no cost to the 
public upon reasonable request; and 
 (f) enter into contracts necessary for the performance of 
the commissioner's duties with federal, state, regional, metropolitan, local, 
and other agencies or units of government; educational institutions, including 
the University of Minnesota. Contracts made pursuant to this section shall not 
be subject to the competitive bidding requirements of chapter  The commissioner may apply for, receive, and expend money 
made available from federal or other sources for the purpose of carrying out the 
duties and responsibilities of the commissioner pursuant to this chapter. 
 All moneys received by the commissioner pursuant to this 
chapter shall be deposited in the state treasury and are appropriated to the 
commissioner for the purpose for which the moneys have been received. The money 
shall not cancel and shall be available until expended. 
 Sec. 34. Minnesota Statutes 1996, section 116J.402, is 
amended to read: 
 116J.402 [COOPERATIVE CONTRACTS.] 
 The commissioner of trade and economic development may 
apply for, receive, and spend money for community development from municipal, 
county, regional, and other planning agencies. The commissioner may also apply 
for, accept, and disburse grants and other aids for community development and 
related planning from the federal government and other sources. The commissioner 
may enter into contracts with agencies of the federal government, local 
governmental units, regional development commissions, and the metropolitan 
council, other state agencies, the University of Minnesota, and other 
educational institutions, and private persons as necessary to perform the 
commissioner's duties. Contracts made according to this section, except those 
with private persons, are not subject to the provisions of chapter  The commissioner may apply for, receive, and spend money 
made available from federal sources or other sources for the purposes of 
carrying out the duties and responsibilities of the commissioner. 
 Money received by the commissioner under this section 
must be deposited in the state treasury and is appropriated to the commissioner 
for the purposes for which the money has been received. The money does not 
cancel and is available until spent. 
 Sec. 35. Minnesota Statutes 1996, section 116J.58, 
subdivision 2, is amended to read: 
 Subd. 2. [PROMOTIONAL CONTRACTS.] In order to best carry 
out duties and responsibilities and to serve the people of the state in the 
promotion of tourism, trade, and economic development, the commissioner may 
engage in programs and projects jointly with a private person, firm, corporation 
or association and may enter into contracts under terms to be mutually agreed 
upon to carry out such programs and projects not including acquisition of land 
or buildings. Contracts may be negotiated and are not subject to the provisions 
of chapter  Sec. 36. Minnesota Statutes 1996, section 116J.68, 
subdivision 2, is amended to read: 
 Subd. 2. The bureau shall: 
 (a) provide information and assistance with respect to 
all aspects of business planning and business management related to the 
start-up, operation, or expansion of a small business in Minnesota; 
 (b) refer persons interested in the start-up, operation, 
or expansion of a small business in Minnesota to assistance programs sponsored 
by federal agencies, state agencies, educational institutions, chambers of 
commerce, civic organizations, community development groups, private industry 
associations, and other organizations or to the business assistance referral 
system established by the Minnesota Project Outreach Corporation; 
 (c) plan, develop, and implement a master file of 
information on small business assistance programs of federal, state, and local 
governments, and other public and private organizations so as to provide 
comprehensive, timely information to the bureau's clients; 
 (d) employ staff with adequate and appropriate skills and 
education and training for the delivery of information and assistance; 
 (e) seek out and utilize, to the extent practicable, 
contributed expertise and services of federal, state, and local governments, 
educational institutions, and other public and private organizations; 
 (f) maintain a close and continued relationship with the 
director of the procurement program within the department of administration so 
as to facilitate the department's duties and responsibilities under sections  (g) develop an information system which will enable the 
commissioner and other state agencies to efficiently store, retrieve, analyze, 
and exchange data regarding small business development and growth in the state. 
All executive branch agencies of state government and the secretary of state 
shall to the extent practicable, assist the bureau in the development and 
implementation of the information system; 
 (h) establish and maintain a toll free telephone number 
so that all small business persons anywhere in the state can call the bureau 
office for assistance. An outreach program shall be established to make the 
existence of the bureau well known to its potential clientele throughout the 
state. If the small business person requires a referral to another provider the 
bureau may use the business assistance referral system established by the 
Minnesota Project Outreach Corporation; 
 (i) conduct research and provide data as required by the 
state legislature; 
 (j) develop and publish material on all aspects of the 
start-up, operation, or expansion of a small business in Minnesota; 
 (k) collect and disseminate information on state 
procurement opportunities, including information on the procurement process; 
 (l) develop a public awareness program through the use of 
newsletters, personal contacts, and electronic and print news media advertising 
about state assistance programs for small businesses, including those programs 
specifically for socially disadvantaged small business persons; 
 (m) enter into agreements with the federal government and 
other public and private entities to serve as the statewide coordinator or host 
agency for the federal small business development center program under United 
States Code, title 15, section 648; and 
 (n) assist providers in the evaluation of their programs 
and the assessment of their service area needs. The bureau may establish model 
evaluation techniques and performance standards for providers to use. 
 Sec. 37. Minnesota Statutes 1996, section 116J.966, 
subdivision 1, is amended to read: 
 Subdivision 1. [GENERALLY.] (a) The commissioner shall 
promote, develop, and facilitate trade and foreign investment in Minnesota. In 
furtherance of these goals, and in addition to the powers granted by section 
116J.035, the commissioner may: 
 (1) locate, develop, and promote international markets 
for Minnesota products and services; 
 (2) arrange and lead trade missions to countries with 
promising international markets for Minnesota goods, technology, services, and 
agricultural products; 
 (3) promote Minnesota products and services at domestic 
and international trade shows; 
 (4) organize, promote, and present domestic and 
international trade shows featuring Minnesota products and services; 
 (5) host trade delegations and assist foreign traders in 
contacting appropriate Minnesota businesses and investments; 
 (6) develop contacts with Minnesota businesses and gather 
and provide information to assist them in locating and communicating with 
international trading or joint venture counterparts; 
 (7) provide information, education, and counseling 
services to Minnesota businesses regarding the economic, commercial, legal, and 
cultural contexts of international trade; 
 (8) provide Minnesota businesses with international trade 
leads and information about the availability and sources of services relating to 
international trade, such as export financing, licensing, freight forwarding, 
international advertising, translation, and custom brokering; 
 (9) locate, attract, and promote foreign direct 
investment and business development in Minnesota to enhance employment 
opportunities in Minnesota; 
 (10) provide foreign businesses and investors desiring to 
locate facilities in Minnesota information regarding sources of governmental, 
legal, real estate, financial, and business services; 
 (11) enter into contracts or other agreements with 
private persons and public entities, including agreements to establish and 
maintain offices and other types of representation in foreign countries, to 
carry out the purposes of promoting international trade and attracting 
investment from foreign countries to Minnesota and to carry out this section, 
without regard to  (12) enter into administrative, programming, and service 
partnerships with the Minnesota world trade center; and 
 (13) market trade-related materials to businesses and 
organizations, and the proceeds of which must be placed in a special revolving 
account and are appropriated to the commissioner to prepare and distribute 
trade-related materials. 
 (b) The programs and activities of the commissioner of 
trade and economic development and the Minnesota trade division may not 
duplicate programs and activities of the commissioner of agriculture or the 
Minnesota world trade center corporation. 
 (c) The commissioner shall notify the chairs of the 
senate finance and house appropriations committees of each agreement under this 
subdivision to establish and maintain an office or other type of representation 
in a foreign country. 
 Sec. 38. Minnesota Statutes 1997 Supplement, section 
121.1113, subdivision 2, is amended to read: 
 Subd. 2. [DEPARTMENT OF CHILDREN, FAMILIES, AND LEARNING 
ASSISTANCE.] The department of children, families, and learning shall contract 
for professional and technical services according to competitive bidding 
procedures under chapter  Sec. 39. Minnesota Statutes 1996, section 124.14, 
subdivision 1, is amended to read: 
 Subdivision 1. The commissioner shall supervise 
distribution of school aids and grants in accordance with law. It may make rules 
consistent with law for the distribution to enable districts to perform 
efficiently the services required by law and further education in the state, 
including reasonable requirements for the reports and accounts to it as will 
assure accurate and lawful apportionment of aids. State and federal aids and 
discretionary or entitlement grants distributed by the commissioner shall not be 
subject to the contract approval procedures of the commissioner of 
administration or to chapter 16A  Sec. 40. Minnesota Statutes 1996, section 126.151, 
subdivision 2, is amended to read: 
 Subd. 2. [ACCOUNTS OF THE ORGANIZATION.] The commissioner 
and the board of trustees of the Minnesota state colleges and universities may 
retain dues and other money collected on behalf of students participating in 
approved vocational student organizations and may deposit the money in separate 
accounts. The money in these accounts shall be available for expenditures for 
state and national activities related to specific organizations. Administration 
of money collected under this section is not subject to the provisions of 
chapters 15, 16A,  Sec. 41. Minnesota Statutes 1996, section 129C.10, 
subdivision 7, is amended to read: 
 Subd. 7. [PURCHASING INSTRUCTIONAL ITEMS.] Technical 
educational equipment may be procured for programs of the Lola and Rudy Perpich 
Minnesota center for arts education by the board either by brand designation or 
in accordance with standards and specifications the board may adopt, 
notwithstanding  Sec. 42. Minnesota Statutes 1996, section 136A.06, is 
amended to read: 
 136A.06 [FEDERAL FUNDS.] 
 The higher education services office is designated the 
state agency to apply for, receive, accept, and disburse to both public and 
private institutions of higher education all federal funds which are allocated 
to the state of Minnesota to support higher education programs, construction, or 
other activities and which require administration by a state higher education 
agency under the Higher Education Facilities Act of 1963, and any amendments 
thereof, the Higher Education Act of 1965, and any amendments thereof, and any 
other law which provides funds for higher education and requires administration 
by a state higher education agency as enacted or may be enacted by the Congress 
of the United States; provided that no commitment shall be made that shall bind 
the legislature to make appropriations beyond current allocations of funds. The 
office may apply for, receive, accept, and disburse all administrative funds 
available to the office for administering federal funds to support higher 
education programs, construction, or other activities. The office also may apply 
for, receive, accept, and disburse any research, planning, or program funds 
which are available for purposes consistent with the provisions of this chapter. 
In making application for and administering federal funds the office may comply 
with any and all requirements of federal law and federal rules and regulations 
to enable it to receive and accept such funds. The expenditure of any such funds 
received shall be governed by the laws of the state, except insofar as federal 
regulations may otherwise provide. The office may contract with both public and 
private institutions in administering federal funds, and such contracts shall 
not be subject to the provisions of chapter  Sec. 43. Minnesota Statutes 1996, section 136A.16, 
subdivision 1, is amended to read: 
 Subdivision 1. Notwithstanding chapter  Sec. 44. Minnesota Statutes 1996, section 136A.29, 
subdivision 6, is amended to read: 
 Subd. 6. The authority is authorized and empowered to 
determine the location and character of any project to be financed under the 
provisions of sections 136A.25 to 136A.42, and to construct, reconstruct, 
remodel, maintain, manage, enlarge, alter, add to, repair, operate, lease, as 
lessee or lessor, and regulate the same, to enter into contracts for any or all 
of such purposes, to enter into contracts for the management and operation of a 
project, and to designate a participating institution of higher education as its 
agent to determine the location and character of a project undertaken by such 
participating institution of higher education under the provisions of sections 
136A.25 to 136A.42 and as the agent of the authority, to construct, reconstruct, 
remodel, maintain, manage, enlarge, alter, add to, repair, operate, lease, as 
lessee or lessor, and regulate the same, and as the agent of the authority, to 
enter into contracts for any or all of such purposes, including contracts for 
the management and operation of such project. Contracts of the authority or of a 
participating institution of higher education to acquire or to construct, 
reconstruct, remodel, maintain, enlarge, alter, add to, or repair projects shall 
not be subject to the provisions of chapter  Sec. 45. Minnesota Statutes 1997 Supplement, section 
136A.40, is amended to read: 
 136A.40 [ADMINISTRATION.] 
 The administration of sections 136A.25 to 136A.42, shall 
be under the authority independent of other departments and agencies and 
notwithstanding chapter  Sec. 46. Minnesota Statutes 1996, section 136F.23, is 
amended to read: 
 136F.23 [STUDENT ASSOCIATIONS; PURCHASING AUTHORITY.] 
 Notwithstanding chapter 16A or  Sec. 47. Minnesota Statutes 1996, section 136F.56, 
subdivision 5, is amended to read: 
 Subd. 5. [SERVICE CONTRACTS.] The council may contract 
for the services it needs to carry out its function. The council may also 
contract to provide services to other organizations. The contracts are not 
subject to the contract approval procedures of the commissioner of 
administration or of chapter  Sec. 48. Minnesota Statutes 1996, section 136F.581, 
subdivision 3, is amended to read: 
 Subd. 3. [PROCUREMENT FROM DESIGNATED BUSINESSES.] The 
policies and procedures must include provisions for procurement, including 
construction, from small targeted group businesses and businesses from 
economically disadvantaged areas designated under section  Sec. 49. Minnesota Statutes 1996, section 136F.66, is 
amended to read: 
 136F.66 [CAPITAL PROJECTS BIDDING PROCEDURES.] 
 In awarding contracts for capital projects under section 
136F.64, the board shall consider the documentation provided by the bidders 
regarding their qualifications, including evidence of having successfully 
completed similar work, or delivering services or products comparable to that 
being requested. The board shall set procedures to administer this section, 
which must include practices that will assist in the economic development of 
small businesses, small targeted group businesses, and businesses in 
economically disadvantaged areas designated under section  Sec. 50. Minnesota Statutes 1996, section 136F.72, 
subdivision 3, is amended to read: 
 Subd. 3. [ADMINISTRATION.] Each college and university, 
independent of other authority and notwithstanding chapters 16A  Sec. 51. Minnesota Statutes 1996, section 136F.96, is 
amended to read: 
 136F.96 [ADMINISTRATION.] 
 The administration of sections 136F.90 to 136F.98 shall 
be under the board of trustees of the Minnesota state colleges and universities 
independent of other authority and notwithstanding chapters 16A  Sec. 52. Minnesota Statutes 1996, section 137.35, 
subdivision 1, is amended to read: 
 Subdivision 1. [PURCHASING METHODS.] (a) The regents may 
award up to a six percent preference in the amount bid for specified goods and 
services to small targeted group businesses designated under section  (b) The regents may designate a purchase of goods or 
services for award only to small targeted group businesses designated under 
section  (c) The regents, as a condition of awarding a 
construction contract or approving a contract for consultant, professional, or 
technical services, may set goals that require the prime contractor to 
subcontract a portion of the contract to small targeted group businesses. The 
regents must establish a procedure for granting waivers from the subcontracting 
requirement when qualified small targeted group businesses are not reasonably 
available. The regents may establish financial incentives for prime contractors 
who exceed the goals for use of subcontractors and financial penalties for prime 
contractors who fail to meet goals under this paragraph. The subcontracting 
requirements of this paragraph do not apply to prime contractors who are small 
targeted group businesses. At least 75 percent of the value of the subcontracts 
awarded to small targeted group businesses under this paragraph must be 
performed by the business to which the subcontract is awarded or by another 
small targeted group business. 
 (d) The regents may award up to a four percent preference 
in the amount bid on university procurement to small businesses located in an 
economically disadvantaged area as defined in section  (e) The regents may delegate responsibility under this 
section to university employees. 
 Sec. 53. Minnesota Statutes 1996, section 137.35, 
subdivision 2, is amended to read: 
 Subd. 2. [ELIGIBILITY.] The rules adopted by the 
commissioner of administration to define small businesses and to set time and 
other eligibility requirements for participation in programs under sections  Sec. 54. Minnesota Statutes 1996, section 137.35, 
subdivision 3, is amended to read: 
 Subd. 3. [NONCOMPETITIVE BIDS.] The regents are 
encouraged to purchase from small targeted group businesses designated under 
section  Sec. 55. Minnesota Statutes 1997 Supplement, section 
138.35, subdivision 1b, is amended to read: 
 Subd. 1b. [CONTRACTS; VOLUNTEERS; GRANTS AND GIFTS.] The 
state archaeologist may contract with the federal government, local governmental 
units, other states, the university and other educational institutions, and 
private persons or organizations as necessary in the performance of the duties 
in sections 138.31 to 138.42. Contracts made under this section for professional 
services shall not be subject to chapter  Sec. 56. Minnesota Statutes 1996, section 144.0742, is 
amended to read: 
 144.0742 [CONTRACTS FOR PROVISION OF PUBLIC HEALTH 
SERVICES.] 
 The commissioner of health is authorized to enter into 
contractual agreements with any public or private entity for the provision of 
statutorily prescribed public health services by the department. The contracts 
shall specify the services to be provided and the amount and method of 
reimbursement therefor. Funds generated in a contractual agreement made pursuant 
to this section are appropriated to the department for purposes of providing the 
services specified in the contracts. All such contractual agreements shall be 
processed in accordance with the provisions of chapter  Sec. 57. Minnesota Statutes 1996, section 144.95, 
subdivision 5, is amended to read: 
 Subd. 5. [GENERAL AUTHORITY.] (a) To carry out 
subdivisions 1 to 4, the commissioner of health may: 
 (1) accept money, property, or services from any source; 
 (2) receive and hold lands; 
 (3) accept gifts; 
 (4) cooperate with city, state, federal, or private 
agencies whose research on mosquito control or on other environmental matters 
may be affected by the commissioner's mosquito management and research 
activities; and 
 (5) enter into contracts with any public or private 
entity. 
 (b) The contracts must specify the duties performed, 
services provided, and the amount and method of reimbursement for them. Money 
collected by the commissioner under contracts made under this subdivision is 
appropriated to the commissioner for the purposes specified in the contracts. 
Contractual agreements must be processed under section  Sec. 58. Minnesota Statutes 1996, section 161.315, 
subdivision 4, is amended to read: 
 Subd. 4. [EXCEPTIONS.] The commissioner may terminate a 
debarment by order, or the commissioner or a county, town, or home rule or 
statutory city may award a contract to a debarred or suspended person when: 
 (1) that person is the sole supplier of a material or 
service required by the commissioner or a county, town, or home rule or 
statutory city; 
 (2) the commissioner determines that an emergency exists 
as defined in section 161.32, subdivision 3; 
 (3) the commissioner of administration determines that an 
emergency exists as defined in section  (4) in the case of a contract to be awarded by a county, 
town, or home rule or statutory city, the governing body thereof determines by 
resolution that an emergency exists that will result in a road, street, or 
bridge being closed to travel; or 
 (5) the contract is for purchasing materials or renting 
equipment for routine road maintenance. 
 Sec. 59. Minnesota Statutes 1996, section 161.321, 
subdivision 1, is amended to read: 
 Subdivision 1. [DEFINITIONS.] For purposes of this 
section the following terms have the meanings given them, except where the 
context clearly indicates a different meaning is intended. 
 (a) "Award" means the granting of a contract in 
accordance with all applicable laws and rules governing competitive bidding 
except as otherwise provided in this section. 
 (b) "Contract" means an agreement entered into between a 
business entity and the state of Minnesota for the construction of 
transportation improvements. 
 (c) "Subcontractor" means a business entity which enters 
into a legally binding agreement with another business entity which is a party 
to a contract as defined in clause (b). 
 (d) "Targeted group business" means a business designated 
under section  Sec. 60. Minnesota Statutes 1996, section 161.321, 
subdivision 2, is amended to read: 
 Subd. 2. [SMALL BUSINESS SET-ASIDES.] (a) The 
commissioner may award up to a six percent preference in the amount bid for 
specified construction work to small targeted group businesses. 
 (b) The commissioner may designate a contract for 
construction work for award only to small targeted group businesses if the 
commissioner determines that at least three small targeted group businesses are 
likely to bid. 
 (c) The commissioner, as a condition of awarding a 
construction contract, may set goals that require the prime contractor to 
subcontract a portion of the contract to small targeted group businesses. The 
commissioner must establish a procedure for granting waivers from the 
subcontracting requirement when qualified small targeted group businesses are 
not reasonably available. The commissioner may establish financial incentives 
for prime contractors who exceed the goals for use of subcontractors and 
financial penalties for prime contractors who fail to meet goals under this 
paragraph. The subcontracting requirements of this paragraph do not apply to 
prime contractors who are small targeted group businesses. 
 (d) The commissioner may award up to a four percent 
preference in the amount bid on procurement to small businesses located in an 
economically disadvantaged area as defined in section  Sec. 61. Minnesota Statutes 1996, section 161.321, 
subdivision 5, is amended to read: 
 Subd. 5. [RECOURSE TO OTHER BUSINESSES.] If the 
commissioner is unable to award a contract pursuant to the provisions of 
subdivisions 2 and 3, the award may be placed pursuant to the normal 
solicitation and award provisions set forth in this chapter and chapter  Sec. 62. Minnesota Statutes 1996, section 161.321, 
subdivision 6, is amended to read: 
 Subd. 6. [RULES.] The rules adopted by the commissioner 
of administration to define small businesses and to set time and other 
eligibility requirements for participation in programs under sections  Sec. 63. Minnesota Statutes 1996, section 161.321, 
subdivision 7, is amended to read: 
 Subd. 7. [NONCOMPETITIVE BIDS.] The commissioner is 
encouraged to purchase from small targeted group businesses designated under 
section  Sec. 64. Minnesota Statutes 1996, section 161.41, 
subdivision 2, is amended to read: 
 Subd. 2. [DETERMINATION OF VALUE; DISPOSITION.] The 
commissioner shall administer all aspects of the disposition of property 
declared to be surplus under this section. The commissioner shall first 
determine the value of the surplus property. The commissioner may then transfer 
the possession of the surplus property to any state agency or political 
subdivision of this state or to the United States government upon receipt of 
payment in an amount equal to the value of the surplus property. 
 The commissioner may also sell the surplus property under 
the competitive bidding provisions of chapter  Sec. 65. Minnesota Statutes 1997 Supplement, section 
179A.03, subdivision 14, is amended to read: 
 Subd. 14. [PUBLIC EMPLOYEE.] "Public employee" or 
"employee" means any person appointed or employed by a public employer except: 
 (a) elected public officials; 
 (b) election officers; 
 (c) commissioned or enlisted personnel of the Minnesota 
national guard; 
 (d) emergency employees who are employed for emergency 
work caused by natural disaster; 
 (e) part-time employees whose service does not exceed the 
lesser of 14 hours per week or 35 percent of the normal work week in the 
employee's appropriate unit; 
 (f) employees whose positions are basically temporary or 
seasonal in character and: (1) are not for more than 67 working days in any 
calendar year; or (2) are not for more than 100 working days in any calendar 
year and the employees are under the age of 22, are full-time students enrolled 
in a nonprofit or public educational institution prior to being hired by the 
employer, and have indicated, either in an application for employment or by 
being enrolled at an educational institution for the next academic year or term, 
an intention to continue as students during or after their temporary employment; 
 (g) employees providing services for not more than two 
consecutive quarters to the board of trustees of the Minnesota state colleges 
and universities under the terms of a professional or technical services 
contract as defined in section  (h) employees of charitable hospitals as defined by 
section 179.35, subdivision 3; 
 (i) full-time undergraduate students employed by the 
school which they attend under a work-study program or in connection with the 
receipt of financial aid, irrespective of number of hours of service per week; 
 (j) an individual who is employed for less than 300 hours 
in a fiscal year as an instructor in an adult vocational education program; 
 (k) an individual hired by a school district or the board 
of trustees of the Minnesota state colleges and universities to teach one course 
for up to four credits for one quarter in a year. 
 The following individuals are public employees regardless 
of the exclusions of clauses (e) and (f): 
 (1) An employee hired by a school district or the board 
of trustees of the Minnesota state colleges and universities except at the 
university established in section 136F.13 or for community services or community 
education instruction offered on a noncredit basis: (i) to replace an absent 
teacher or faculty member who is a public employee, where the replacement 
employee is employed more than 30 working days as a replacement for that teacher 
or faculty member; or (ii) to take a teaching position created due to increased 
enrollment, curriculum expansion, courses which are a part of the curriculum 
whether offered annually or not, or other appropriate reasons; and 
 (2) An employee hired for a position under clause (f)(1) 
if that same position has already been filled under clause (f)(1) in the same 
calendar year and the cumulative number of days worked in that same position by 
all employees exceeds 67 calendar days in that year. For the purpose of this 
paragraph, "same position" includes a substantially equivalent position if it is 
not the same position solely due to a change in the classification or title of 
the position. 
 Sec. 66. Minnesota Statutes 1996, section 179A.23, is 
amended to read: 
 179A.23 [LIMITATION ON CONTRACTING-OUT OF SERVICES 
PROVIDED BY MEMBERS OF A STATE OF MINNESOTA OR UNIVERSITY OF MINNESOTA 
BARGAINING UNIT.] 
 Any contract entered into after March 23, 1982, by the 
state of Minnesota or the University of Minnesota involving services, any part 
of which, in the absence of the contract, would be performed by members of a 
unit provided in sections 179A.10 and 179A.11, shall be subject to section  Contracts entered into by the state of Minnesota for the 
purpose of providing court reporter services or transcription of the record of a 
hearing which was recorded by means of an audio magnetic recording device shall 
be subject to section  Sec. 67. Minnesota Statutes 1996, section 198.35, 
subdivision 1, is amended to read: 
 Subdivision 1. [ESTABLISHMENT.] The board may establish a 
veterans home in Silver Bay by renovating an existing facility owned by the city 
of Silver Bay if the city donates the building to the board at no cost. 
Contracts made by the board for the purposes of this subdivision are subject to 
chapter  Sec. 68. Minnesota Statutes 1996, section 216C.02, 
subdivision 1, is amended to read: 
 Subdivision 1. [POWERS.] (a) The commissioner may: 
 (1) apply for, receive, and spend money received from 
federal, municipal, county, regional, and other government agencies and private 
sources; 
 (2) apply for, accept, and disburse grants and other aids 
from public and private sources; 
 (3) contract for professional services if work or 
services required or authorized to be carried out by the commissioner cannot be 
satisfactorily performed by employees of the department or by another state 
agency; 
 (4) enter into interstate compacts to carry out research 
and planning jointly with other states or the federal government when 
appropriate; 
 (5) upon reasonable request, distribute informational 
material at no cost to the public; and 
 (6) enter into contracts for the performance of the 
commissioner's duties with federal, state, regional, metropolitan, local, and 
other agencies or units of government and educational institutions, including 
the University of Minnesota, without regard to the competitive bidding 
requirements of chapters 16A and  (b) The commissioner shall collect information on 
conservation and other energy-related programs carried on by other agencies, by 
public utilities, by cooperative electric associations, by municipal power 
agencies, by other fuel suppliers, by political subdivisions, and by private 
organizations. Other agencies, cooperative electric associations, municipal 
power agencies, and political subdivisions shall cooperate with the commissioner 
by providing information requested by the commissioner. The commissioner may by 
rule require the submission of information by other program operators. The 
commissioner shall make the information available to other agencies and to the 
public and, as necessary, shall recommend to the legislature changes in the laws 
governing conservation and other energy-related programs to ensure that: 
 (1) expenditures on the programs are adequate to meet 
identified needs; 
 (2) the needs of low-income energy users are being 
adequately addressed; 
 (3) duplication of effort is avoided or eliminated; 
 (4) a program that is ineffective is improved or 
eliminated; and 
 (5) voluntary efforts are encouraged through incentives 
for their operators. 
 The commissioner shall appoint an advisory task force to 
help evaluate the information collected and formulate recommendations to the 
legislature. The task force must include low-income energy users. 
 (c) By January 15 of each year, the commissioner shall 
report to the legislature on the projected amount of federal money likely to be 
available to the state during the next fiscal year, including grant money and 
money received by the state as a result of litigation or settlements of alleged 
violations of federal petroleum pricing regulations. The report must also 
 estimate the amount of money projected as needed during 
the next fiscal year to finance a level of conservation and other energy-related 
programs adequate to meet projected needs, particularly the needs of low-income 
persons and households, and must recommend the amount of state appropriations 
needed to cover the difference between the projected availability of federal 
money and the projected needs. 
 Sec. 69. Minnesota Statutes 1997 Supplement, section 
216D.03, subdivision 2, is amended to read: 
 Subd. 2. [ESTABLISHMENT OF NOTIFICATION CENTER; RULES.] 
(a) The notification center services must be provided by a nonprofit corporation 
approved in writing by the commissioner. The nonprofit corporation must be 
governed by a board of directors of up to 20 members, one of whom is the 
director of the office of pipeline safety. The other board members must 
represent and be elected by operators, excavators, and other persons eligible to 
participate in the center. In deciding to approve a nonprofit corporation, the 
commissioner shall consider whether it meets the requirements of this paragraph 
and whether it demonstrates that it has the ability to contract for and 
implement the notification center service. 
 (b) The commissioner shall adopt rules: 
 (1) establishing a notification process and competitive 
bidding procedure for selecting a vendor to provide the notification service; 
 (2) governing the operating procedures and technology 
needed for a statewide notification center; and 
 (3) setting forth the method for assessing the cost of 
the service among operators. 
 (c) The commissioner shall select a vendor to provide the 
notification center service. The commissioner may advertise for bids as provided 
in section  (d) An operator may submit a bid and be selected to 
contract to provide the notification center service under paragraph (a) or (c). 
The commissioner shall annually review the services provided by the nonprofit 
corporation approved under paragraph (a) or the vendor selected under paragraph 
(c). 
 Sec. 70. Minnesota Statutes 1996, section 237.51, 
subdivision 5a, is amended to read: 
 Subd. 5a. [DEPARTMENT OF HUMAN SERVICES; DUTIES.] (a) In 
addition to any duties specified elsewhere in sections 237.51 to 237.56, the 
department of human services shall: 
 (1) define economic hardship, special needs, and 
household criteria so as to determine the priority of eligible applicants for 
initial distribution of devices and to determine circumstances necessitating 
provision of more than one communication device per household; 
 (2) establish a method to verify eligibility 
requirements; 
 (3) establish specifications for communication devices to 
be purchased under section 237.53, subdivision 3; 
 (4) inform the public and specifically the community of 
communication-impaired persons of the program; and 
 (5) notwithstanding any provision of  (b) The department may establish an advisory board to 
advise the department in carrying out the duties specified in this section and 
to advise the department of public service in carrying out its duties under 
section 237.54. If so established, the advisory board must include, at a 
minimum, the following communication-impaired persons: 
 (1) at least one member who is deaf; 
 (2) at least one member who is speech impaired; 
 (3) at least one member who is mobility impaired; and 
 (4) at least one member who is hard-of-hearing. 
 The membership terms, compensation, and removal of 
members and the filling of membership vacancies are governed by section 15.059. 
Advisory board meetings shall be held at the discretion of the commissioner. 
 Sec. 71. Minnesota Statutes 1996, section 241.0221, 
subdivision 6, is amended to read: 
 Subd. 6. [APPLICATION REVIEW PROCESS FOR SUBSIDY FUNDS.] 
To qualify for a subsidy, a county or group of counties must enter into a 
memorandum of agreement with the commissioner agreeing to comply with the 
minimum standards and requirements established by the commissioner under 
subdivision 4. The memorandum of agreement is not subject to the contract 
approval procedures of the commissioner of administration or  The commissioner shall require a county or group of 
counties to document in its application that it is requesting subsidy funds for 
the least restrictive alternative appropriate to the county or counties 
detention needs. The commissioner shall evaluate applications and grant 
subsidies for local detention facilities and alternative detention programs 
described in this section in a manner consistent with the minimum standards and 
requirements established by the commissioner in subdivision 4 and within the 
limit appropriations made available by law. 
 Sec. 72. Minnesota Statutes 1996, section 241.27, 
subdivision 2, is amended to read: 
 Subd. 2. [REVOLVING FUND; USE OF FUND.] There is 
established in the department of corrections under the control of the 
commissioner of corrections the Minnesota correctional industries revolving fund 
to which shall be transferred the revolving funds authorized in Minnesota 
Statutes 1978, sections 243.41 and 243.85, clause (f), and any other industrial 
revolving funds heretofore established at any state correctional facility under 
the control of the commissioner of corrections. The revolving fund established 
shall be used for the conduct of the industrial and commercial activities now or 
hereafter established at any state correctional facility, including but not 
limited to the purchase of equipment, raw materials, the payment of salaries, 
wages and other expenses necessary and incident thereto. The purchase of 
materials and commodities for resale are not subject to the competitive bidding 
procedures of section  Sec. 73. Minnesota Statutes 1997 Supplement, section 
241.277, subdivision 2, is amended to read: 
 Subd. 2. [REQUEST FOR PROPOSALS.] After consulting with 
and considering the advice of the association of Minnesota counties, the 
commissioner may issue a request for proposals and select a vendor to operate 
the program. Section  Sec. 74. Minnesota Statutes 1996, section 246.36, is 
amended to read: 
 246.36 [ACCEPTANCE OF VOLUNTARY, UNCOMPENSATED SERVICES.] 
 For the purpose of carrying out a duty, the commissioner 
of human services shall have authority to accept uncompensated and voluntary 
services and to enter into contracts or agreements with private or public 
agencies, or persons, for uncompensated and voluntary services, as the 
commissioner may deem practicable. Uncompensated and voluntary services do not 
include services mandated by licensure and certification requirements for health 
care facilities. The volunteer agencies, organizations, or persons who provide 
services to residents of state facilities operated under the authority of the 
commissioner are not subject to the procurement requirements of chapters 16A and 
 Sec. 75. Minnesota Statutes 1996, section 246.57, 
subdivision 1, is amended to read: 
 Subdivision 1. [AUTHORIZED.] The commissioner of human 
services may authorize any state facility operated under the authority of the 
commissioner to enter into agreement with other governmental entities and both 
nonprofit and for-profit organizations for participation in shared service 
agreements that would be of mutual benefit to the state, other governmental 
entities and organizations involved, and the public. Notwithstanding section  Sec. 76. Minnesota Statutes 1996, section 246.57, 
subdivision 6, is amended to read: 
 Subd. 6. [DENTAL SERVICES.] The commissioner of human 
services shall authorize any regional treatment center or state-operated nursing 
home under the commissioner's authority to provide dental services to disabled 
persons who are eligible for medical assistance and are not residing at the 
regional treatment center or state-operated nursing home, provided that the 
reimbursement received for these services is sufficient to cover actual costs. 
To provide these services, regional treatment centers and state-operated nursing 
homes may participate under contract with health networks in their service area. 
Notwithstanding section  Sec. 77. Minnesota Statutes 1996, section 256B.031, 
subdivision 1, is amended to read: 
 Subdivision 1. [CONTRACTS.] The commissioner may contract 
with health insurers licensed and operating under chapters 60A and 62A, 
nonprofit health service plans licensed and operating under chapter 62C, health 
maintenance organizations licensed and operating under chapter 62D, and vendors 
of medical care and organizations participating in prepaid programs under 
section 256D.03, subdivision 4, clause (b), to provide medical services to 
medical assistance recipients. Notwithstanding any other law, health insurers 
may enter into contracts with the commissioner under this section. As a 
condition of the contract, health insurers and health service plan corporations 
must agree to comply with the requirements of section 62D.04, subdivision 1, 
clauses (a), (b), (c), (d), and (f), and provide a complaint procedure that 
satisfies the requirements of section 62D.11. Nothing in this section permits 
health insurers not licensed as health maintenance organizations under chapter 
62D to offer a prepaid health plan as defined in section 256B.02, subdivision 
12, to persons other than those receiving medical assistance or general 
assistance medical care under this section. Contracts between the commissioner 
and a prepaid health plan are exempt from the set-aside and preference 
provisions of section  Sec. 78. Minnesota Statutes 1996, section 256B.04, 
subdivision 14, is amended to read: 
 Subd. 14. [COMPETITIVE BIDDING.] When determined to be 
effective, economical, and feasible, the commissioner may utilize volume 
purchase through competitive bidding and negotiation under the provisions of 
chapter  (1) eyeglasses; 
 (2) oxygen. The commissioner shall provide for oxygen 
needed in an emergency situation on a short-term basis, until the vendor can 
obtain the necessary supply from the contract dealer; 
 (3) hearing aids and supplies; and 
 (4) durable medical equipment, including but not limited 
to: 
 (a) hospital beds; 
 (b) commodes; 
 (c) glide-about chairs; 
 (d) patient lift apparatus; 
 (e) wheelchairs and accessories; 
 (f) oxygen administration equipment; 
 (g) respiratory therapy equipment; 
 (h) electronic diagnostic, therapeutic and life support 
systems; 
 (5) special transportation services; and 
 (6) drugs. 
 Sec. 79. Minnesota Statutes 1996, section 256B.04, 
subdivision 15, is amended to read: 
 Subd. 15. [UTILIZATION REVIEW.] (1) Establish on a 
statewide basis a new program to safeguard against unnecessary or inappropriate 
use of medical assistance services, against excess payments, against unnecessary 
or inappropriate hospital admissions or lengths of stay, and against 
underutilization of services in prepaid health plans, long-term care facilities 
or any health care delivery system subject to fixed rate reimbursement. In 
implementing the program, the state agency shall utilize both prepayment and 
postpayment review systems to determine if utilization is reasonable and 
necessary. The determination of whether services are reasonable and necessary 
shall be made by the commissioner in consultation with a professional services 
advisory group or health care consultant appointed by the commissioner. 
 (2) Contracts entered into for purposes of meeting the 
requirements of this subdivision shall not be subject to the set-aside 
provisions of chapter  (3) A recipient aggrieved by the commissioner's 
termination of services or denial of future services may appeal pursuant to 
section 256.045. A vendor aggrieved by the commissioner's determination that 
services provided were not reasonable or necessary may appeal pursuant to the 
contested case procedures of chapter 14. To appeal, the vendor shall notify the 
commissioner in writing within 30 days of receiving the commissioner's notice. 
The appeal request shall specify each disputed item, the reason for the dispute, 
an estimate of the dollar amount involved for each disputed item, the 
computation that the vendor believes is correct, the authority in statute or 
rule upon which the vendor relies for each disputed item, the name and address 
of the person or firm with whom contacts may be made regarding the appeal, and 
other information required by the commissioner. 
 (4) The commissioner may select providers to provide case 
management services to recipients who use health care services inappropriately 
or to recipients who are eligible for other managed care projects. The providers 
shall be selected based upon criteria that may include a comparison with a peer 
group of providers related to the quality, quantity, or cost of health care 
services delivered or a review of sanctions previously imposed by health care 
services programs or the provider's professional licensing board. 
 Sec. 80. Minnesota Statutes 1997 Supplement, section 
256B.19, subdivision 2a, is amended to read: 
 Subd. 2a. [DIVISION OF COSTS.] The county shall ensure 
that only the least costly, most appropriate transportation and travel expenses 
are used. The state may enter into volume purchase contracts, or use a 
competitive bidding process, whenever feasible, to minimize the costs of 
transportation services. If the state has entered into a volume purchase 
contract or used the competitive bidding procedures of chapter  Sec. 81. Minnesota Statutes 1997 Supplement, section 
256D.03, subdivision 6, is amended to read: 
 Subd. 6. [DIVISION OF COSTS.] The state share of county 
agency expenditures for general assistance medical care shall be 100 percent. 
Payments made under this subdivision shall be made according to sections 
256B.041, subdivision 5 and 256B.19, subdivision 1. In counties where a pilot or 
demonstration project is operated for general assistance medical care services, 
the state may pay 100 percent of the costs of administering the pilot or 
demonstration project. 
 Notwithstanding any provision to the contrary, beginning 
July 1, 1991, the state shall pay 100 percent of the costs for centralized 
claims processing by the department of administration relative to claims 
beginning January 1, 1991, and submitted on behalf of general assistance medical 
care recipients by vendors in the general assistance medical care program. 
 Beginning July 1, 1991, the state shall reimburse 
counties up to the limit of state appropriations for general assistance medical 
care common carrier transportation and related travel expenses provided for 
medical purposes after December 31, 1990. For purposes of this subdivision, 
transportation shall have the meaning given it in Code of Federal Regulations, 
title 42, section 440.170(a), as amended through October 1, 1987, and travel 
expenses shall have the meaning given in Code of Federal Regulations, title 42, 
section 440.170(a)(3), as amended through October 1, 1987. 
 The county shall ensure that only the least costly most 
appropriate transportation and travel expenses are used. The state may enter 
into volume purchase contracts, or use a competitive bidding process, whenever 
feasible, to minimize the costs of transportation services. If the state has 
entered into a volume purchase contract or used the competitive bidding 
procedures of chapter  In counties where prepaid health plans are under contract 
to the commissioner to provide services to general assistance medical care 
recipients, the cost of court ordered treatment that does not include diagnostic 
evaluation, recommendation, or referral for treatment by the prepaid health plan 
is the responsibility of the county of financial responsibility. 
 Sec. 82. Minnesota Statutes 1996, section 298.2211, 
subdivision 4, is amended to read: 
 Subd. 4. [OBLIGATIONS NOT STATE DEBT.] Bonds and other 
obligations issued by the commissioner pursuant to this section, along with all 
related documents, are not general obligations of the state of Minnesota and are 
not subject to  Sec. 83. Minnesota Statutes 1996, section 349A.06, 
subdivision 1, is amended to read: 
 Subdivision 1. [CONTRACTS.] The director shall sell 
tickets for the lottery through lottery retailers with whom the director 
contracts. Contracts under this section are not subject to the provisions of 
sections  Sec. 84. Minnesota Statutes 1996, section 349A.07, 
subdivision 6, is amended to read: 
 Subd. 6. [EXEMPTIONS.] Lottery procurement contracts 
entered into by the director are not subject to the provisions of  Sec. 85. Minnesota Statutes 1996, section 352.03, 
subdivision 6, is amended to read: 
 Subd. 6. [DUTIES AND POWERS OF EXECUTIVE DIRECTOR.] The 
management of the system is vested in the director, who is the executive and 
administrative head of the system. The director shall be advisor to the board on 
matters pertaining to the system and shall also act as the secretary of the 
board. The director shall: 
 (1) attend meetings of the board; 
 (2) prepare and recommend to the board appropriate rules 
to carry out this chapter; 
 (3) establish and maintain an adequate system of records 
and accounts following recognized accounting principles and controls; 
 (4) designate an assistant director with the approval of 
the board; 
 (5) appoint any employees, both permanent and temporary, 
that are necessary to carry out the provisions of this chapter; 
 (6) organize the work of the system as the director deems 
necessary to fulfill the functions of the system, and define the duties of its 
employees and delegate to them any powers or duties, subject to the control of 
the director and under conditions the director may prescribe. Appointments to 
exercise delegated power must be by written order and shall be filed with the 
secretary of state; 
 (7) with the advice and consent of the board, contract 
for the services of an approved actuary, professional management services, and 
any other consulting services as necessary and fix the compensation for those 
services. The contracts are not subject to competitive bidding under chapter  (8) with the advice and consent of the board provide 
in-service training for the employees of the system; 
 (9) make refunds of accumulated contributions to former 
state employees and to the designated beneficiary, surviving spouse, legal 
representative, or next of kin of deceased state employees or deceased former 
state employees, as provided in this chapter; 
 (10) determine the amount of the annuities and disability 
benefits of employees covered by the system and authorize payment of the 
annuities and benefits beginning as of the dates on which the annuities and 
benefits begin to accrue, in accordance with the provisions of this chapter; 
 (11) pay annuities, refunds, survivor benefits, salaries, 
and necessary operating expenses of the system; 
 (12) certify funds available for investment to the state 
board of investment; 
 (13) with the advice and approval of the board request 
the state board of investment to sell securities when the director determines 
that funds are needed for the system; 
 (14) prepare and submit to the board and the legislature 
an annual financial report covering the operation of the system, as required by 
section 356.20; 
 (15) prepare and submit biennial and annual budgets to 
the board and with the approval of the board submit the budgets to the 
department of finance; and 
 (16) with the approval of the board, perform other duties 
required to administer the retirement and other provisions of this chapter and 
to do its business. 
 Sec. 86. Minnesota Statutes 1996, section 352.03, 
subdivision 16, is amended to read: 
 Subd. 16. [DATA PROCESSING SERVICES.] Notwithstanding 
chapter 16B Sec. 87. Minnesota Statutes 1997 Supplement, section 
353.03, subdivision 3a, is amended to read: 
 Subd. 3a. [EXECUTIVE DIRECTOR.] (a) [APPOINTMENT.] The 
board shall appoint, with the advice and consent of the senate, an executive 
director on the basis of education, experience in the retirement field, and 
leadership ability. The executive director shall have had at least five years' 
experience in an executive level management position, which has included 
responsibility for pensions, deferred compensation, or employee benefits. The 
executive director serves at the pleasure of the board. The salary of the 
executive director is as provided by section 15A.0815. 
 (b) [DUTIES.] The management of the association is vested 
in the executive director who shall be the executive and administrative head of 
the association. The executive director shall act as adviser to the board on all 
matters pertaining to the association and shall also act as the secretary of the 
board. The executive director shall: 
 (1) attend all meetings of the board; 
 (2) prepare and recommend to the board appropriate rules 
to carry out the provisions of this chapter; 
 (3) establish and maintain an adequate system of records 
and accounts following recognized accounting principles and controls; 
 (4) designate, with the approval of the board, up to two 
persons who shall serve in the unclassified service and whose salary is set in 
accordance with section 43A.18, subdivision 3, appoint a confidential secretary 
in the unclassified service, and appoint employees to carry out this chapter, 
who are subject to chapters 43A and 179A in the same manner as are executive 
branch employees; 
 (5) organize the work of the association as the director 
deems necessary to fulfill the functions of the association, and define the 
duties of its employees and delegate to them any powers or duties, subject to 
the control of, and under such conditions as, the executive director may 
prescribe; 
 (6) with the approval of the board, contract for the 
services of an approved actuary, professional management services, and any other 
consulting services as necessary to fulfill the purposes of this chapter. All 
contracts are subject to chapter  (7) with the approval of the board provide in-service 
training for the employees of the association; 
 (8) make refunds of accumulated contributions to former 
members and to the designated beneficiary, surviving spouse, legal 
representative or next of kin of deceased members or deceased former members, as 
provided in this chapter; 
 (9) determine the amount of the annuities and disability 
benefits of members covered by the association and authorize payment of the 
annuities and benefits beginning as of the dates on which the annuities and 
benefits begin to accrue, in accordance with the provisions of this chapter; 
 (10) pay annuities, refunds, survivor benefits, salaries, 
and necessary operating expenses of the association; 
 (11) prepare and submit to the board and the legislature 
an annual financial report covering the operation of the association, as 
required by section 356.20; 
 (12) prepare and submit biennial and annual budgets to 
the board for its approval and submit the approved budgets to the department of 
finance for approval by the commissioner; 
 (13) reduce all or part of the accrued interest payable 
under section 353.27, subdivisions 12, 12a, and 12b, or 353.28, subdivision 5, 
upon receipt of proof by the association of an unreasonable processing delay or 
other extenuating circumstances of the employing unit. The executive director 
shall prescribe and submit for approval by the board the conditions under which 
such interest may be reduced; and 
 (14) with the approval of the board, perform such other 
duties as may be required for the administration of the association and the 
other provisions of this chapter and for the transaction of its business. 
 Sec. 88. Minnesota Statutes 1996, section 354.06, 
subdivision 2a, is amended to read: 
 Subd. 2a. [DUTIES OF EXECUTIVE DIRECTOR.] The management 
of the association is vested in the executive director who shall be the 
executive and administrative head of the association. The executive director 
shall act as advisor to the board on all matters pertaining to the association 
and shall also act as the secretary of the board. The executive director shall: 
 (1) attend all meetings of the board; 
 (2) prepare and recommend to the board appropriate rules 
to carry out the provisions of this chapter; 
 (3) establish and maintain an adequate system of records 
and accounts following recognized accounting principles and controls; 
 (4) designate an assistant executive director in the 
unclassified service and two assistant executive directors in the classified 
service with the approval of the board, and appoint such employees, both 
permanent and temporary, as are necessary to carry out the provisions of this 
chapter; 
 (5) organize the work of the association as the director 
deems necessary to fulfill the functions of the association, and define the 
duties of its employees and delegate to them any powers or duties, subject to 
the director's control and under such conditions as the director may prescribe; 
 (6) with the approval of the board, contract and set the 
compensation for the services of an approved actuary, professional management 
services, and any other consulting services. These contracts are not subject to 
the competitive bidding procedure prescribed by chapter  (7) with the approval of the board, provide in-service 
training for the employees of the association; 
 (8) make refunds of accumulated contributions to former 
members and to the designated beneficiary, surviving spouse, legal 
representative, or next of kin of deceased members or deceased former members, 
under this chapter; 
 (9) determine the amount of the annuities and disability 
benefits of members covered by the association and authorize payment of the 
annuities and benefits beginning as of the dates on which the annuities and 
benefits begin to accrue, under this chapter; 
 (10) pay annuities, refunds, survivor benefits, salaries, 
and necessary operating expenses of the association; 
 (11) prepare and submit to the board and the legislature 
an annual financial report covering the operation of the association, as 
required by section 356.20; 
 (12) certify funds available for investment to the state 
board of investment; 
 (13) with the advice and approval of the board, request 
the state board of investment to sell securities on determining that funds are 
needed for the purposes of the association; 
 (14) prepare and submit biennial and annual budgets to 
the board and with the approval of the board submit those budgets to the 
department of finance; and 
 (15) with the approval of the board, perform such other 
duties as may be required for the administration of the association and the 
other provisions of this chapter and for the transaction of its business. The 
executive director may: 
 (i) reduce all or part of the accrued interest and fines 
payable by an employing unit for reporting requirements under section 354.52, 
based on an evaluation of any extenuating circumstances of the employing unit; 
 (ii) assign association employees to conduct field audits 
of an employing unit to ensure compliance with the provisions of this chapter; 
and 
 (iii) recover overpayments, if not repaid to the 
association, by suspending or reducing the payment of a retirement annuity, 
refund, disability benefit, survivor benefit, or optional annuity under this 
chapter until the overpayment, plus interest, has been recovered. 
 Sec. 89. Minnesota Statutes 1996, section 354.07, 
subdivision 7, is amended to read: 
 Subd. 7. Notwithstanding chapter 16B Sec. 90. Minnesota Statutes 1996, section 356A.06, 
subdivision 7, is amended to read: 
 Subd. 7. [EXPANDED LIST OF AUTHORIZED INVESTMENT 
SECURITIES.] (a) [AUTHORITY.] Except to the extent otherwise authorized by law 
or bylaws, a covered pension plan not described by subdivision 6, paragraph (a), 
may invest its assets only in accordance with this subdivision. 
 (b) [SECURITIES GENERALLY.] The covered pension plan has 
the authority to purchase, sell, lend, or exchange the securities specified in 
paragraphs (c) to (g), including puts and call options and future contracts 
traded on a contract market regulated by a governmental agency or by a financial 
institution regulated by a governmental agency. These securities may be owned as 
units in commingled trusts that own the securities described in paragraphs (c) 
to (g). 
 (c) [GOVERNMENT OBLIGATIONS.] The covered pension plan 
may invest funds in governmental bonds, notes, bills, mortgages, and other 
evidences of indebtedness provided the issue is backed by the full faith and 
credit of the issuer or the issue is rated among the top four quality rating 
categories by a nationally recognized rating agency. The obligations in which 
funds may be invested under this paragraph include guaranteed or insured issues 
of (1) the United States, its agencies, its instrumentalities, or organizations 
created and regulated by an act of Congress; (2) Canada and its provinces, 
provided the principal and interest is payable in United States dollars; (3) the 
states and their municipalities, political subdivisions, agencies, or 
instrumentalities; (4) the International Bank for Reconstruction and 
Development, the Inter-American Development Bank, the Asian Development Bank, 
the African Development Bank, or any other United States government sponsored 
organization of which the United States is a member, provided the principal and 
interest is payable in United States dollars. 
 (d) [CORPORATE OBLIGATIONS.] The covered pension plan may 
invest funds in bonds, notes, debentures, transportation equipment obligations, 
or any other longer term evidences of indebtedness issued or guaranteed by a 
corporation organized under the laws of the United States or any state thereof, 
or the Dominion of Canada or any province thereof if they conform to the 
following provisions: 
 (1) the principal and interest of obligations of 
corporations incorporated or organized under the laws of the Dominion of Canada 
or any province thereof must be payable in United States dollars; and 
 (2) obligations must be rated among the top four quality 
categories by a nationally recognized rating agency. 
 (e) [OTHER OBLIGATIONS.] (1) The covered pension plan may 
invest funds in bankers acceptances, certificates of deposit, deposit notes, 
commercial paper, mortgage participation certificates and pools, asset backed 
securities, repurchase agreements and reverse repurchase agreements, guaranteed 
investment contracts, savings accounts, and guaranty fund certificates, surplus 
notes, or debentures of domestic mutual insurance companies if they conform to 
the following provisions: 
 (i) bankers acceptances and deposit notes of United 
States banks are limited to those issued by banks rated in the highest four 
quality categories by a nationally recognized rating agency; 
 (ii) certificates of deposit are limited to those issued 
by (A) United States banks and savings institutions that are rated in the 
highest four quality categories by a nationally recognized rating agency or 
whose certificates of deposit are fully insured by federal agencies; or (B) 
credit unions in amounts up to the limit of insurance coverage provided by the 
National Credit Union Administration; 
 (iii) commercial paper is limited to those issued by 
United States corporations or their Canadian subsidiaries and rated in the 
highest two quality categories by a nationally recognized rating agency; 
 (iv) mortgage participation or pass through certificates 
evidencing interests in pools of first mortgages or trust deeds on improved real 
estate located in the United States where the loan to value ratio for each loan 
as calculated in accordance with section 61A.28, subdivision 3, does not exceed 
80 percent for fully amortizable residential properties and in all other 
respects meets the requirements of section 61A.28, subdivision 3; 
 (v) collateral for repurchase agreements and reverse 
repurchase agreements is limited to letters of credit and securities authorized 
in this section; 
 (vi) guaranteed investment contracts are limited to those 
issued by insurance companies or banks rated in the top four quality categories 
by a nationally recognized rating agency or to alternative guaranteed investment 
contracts where the underlying assets comply with the requirements of this 
subdivision; 
 (vii) savings accounts are limited to those fully insured 
by federal agencies; and 
 (viii) asset backed securities must be rated in the top 
four quality categories by a nationally recognized rating agency. 
 (2) Sections 16A.58  (3) In addition to investments authorized by clause (1), 
item (iv), the covered pension plan may purchase from the Minnesota housing 
finance agency all or any part of a pool of residential mortgages, not in 
default, that has previously been financed by the issuance of bonds or notes of 
the agency. The covered pension plan may also enter into a commitment with the 
agency, at the time of any issue of bonds or notes, to purchase at a specified 
future date, not exceeding 12 years from the date of the issue, the amount of 
mortgage loans then outstanding and not in default that have been made or 
purchased from the proceeds of the bonds or notes. The covered pension plan may 
charge reasonable fees for any such commitment and may agree to purchase the 
mortgage loans at a price sufficient to produce a yield to the covered pension 
plan comparable, in its judgment, to the yield available on similar mortgage 
loans at the date of the bonds or notes. The covered pension plan may also enter 
into agreements with the agency for the investment of any portion of the funds 
of the agency. The agreement must cover the period of the investment, withdrawal 
privileges, and any guaranteed rate of return. 
 (f) [CORPORATE STOCKS.] The covered pension plan may 
invest funds in stocks or convertible issues of any corporation organized under 
the laws of the United States or the states thereof, the Dominion of Canada or 
its provinces, or any corporation listed on the New York Stock Exchange or the 
American Stock Exchange, if they conform to the following provisions: 
 (1) the aggregate value of corporate stock investments, 
as adjusted for realized profits and losses, must not exceed 85 percent of the 
market or book value, whichever is less, of a fund, less the aggregate value of 
investments according to subdivision 6; 
 (2) investments must not exceed five percent of the total 
outstanding shares of any one corporation. 
 (g) [OTHER INVESTMENTS.] (1) In addition to the 
investments authorized in paragraphs (b) to (f), and subject to the provisions 
in clause (2), the covered pension plan may invest funds in: 
 (i) venture capital investment businesses through 
participation in limited partnerships and corporations; 
 (ii) real estate ownership interests or loans secured by 
mortgages or deeds of trust through investment in limited partnerships, bank 
sponsored collective funds, trusts, and insurance company commingled accounts, 
including separate accounts; 
 (iii) regional and mutual funds through bank sponsored 
collective funds and open-end investment companies registered under the Federal 
Investment Company Act of 1940; 
 (iv) resource investments through limited partnerships, 
private placements, and corporations; and 
 (v) international securities. 
 (2) The investments authorized in clause (1) must conform 
to the following provisions: 
 (i) the aggregate value of all investments made according 
to clause (1) may not exceed 35 percent of the market value of the fund for 
which the covered pension plan is investing; 
 (ii) there must be at least four unrelated owners of the 
investment other than the state board for investments made under clause (1), 
item (i), (ii), (iii), or (iv); 
 (iii) covered pension plan participation in an investment 
vehicle is limited to 20 percent thereof for investments made under clause (1), 
item (i), (ii), (iii), or (iv); and 
 (iv) covered pension plan participation in a limited 
partnership does not include a general partnership interest or other interest 
involving general liability. The covered pension plan may not engage in any 
activity as a limited partner which creates general liability. 
 Sec. 91. Minnesota Statutes 1996, section 446A.12, 
subdivision 5, is amended to read: 
 Subd. 5. [EXEMPTION.] The notes and bonds of the 
authority are not subject to  Sec. 92. Minnesota Statutes 1996, section 462A.18, 
subdivision 2, is amended to read: 
 Subd. 2. [CONTRACTS AND SECURITY.] Notwithstanding the 
provisions of this section, the agency shall have power to contract with the 
holders of any of its notes or bonds, as to the custody, collection, securing, 
investment, and payment of any money of the agency, or any money held in trust 
or otherwise for the payment of notes or bonds, and to carry out such contract. 
Money held in trust or otherwise for the payment of notes or bonds or in any way 
to secure notes or bonds and deposits of such money may be secured in the same 
manner as money of the agency, and all banks and trust companies are authorized 
to give such security for such deposits. All money so paid to the state 
treasurer as agent of the agency, from whatever source, are appropriated to the 
agency. The agency's notes and bonds are not subject to  Sec. 93. Minnesota Statutes 1996, section 471.345, 
subdivision 8, is amended to read: 
 Subd. 8. [PROCUREMENT FROM ECONOMICALLY DISADVANTAGED 
PERSONS.] For purposes of this subdivision, the following terms shall have the 
meanings herein ascribed to them: 
 (a) "Small targeted group business" means businesses 
designated under section  (b) "Business entity" means an entity organized for 
profit, including an individual, partnership, corporation, joint venture, 
association, or cooperative. 
 Nothing in this section shall be construed to prohibit 
any municipality from adopting a resolution, rule, regulation, or ordinance 
which on an annual basis designates and sets aside for awarding to small 
targeted group businesses a percentage of the value of its anticipated total 
procurement of goods and services, including construction, and which uses either 
a negotiated price or bid contract procedure in the awarding of a procurement 
contract under a set-aside program as allowed in this subdivision, provided that 
any award based on a negotiated price shall not exceed by more than five percent 
the municipality's estimated price for the goods and services if they were 
purchased on the open market and not under the set-aside program. 
 Sec. 94. Minnesota Statutes 1996, section 473.142, is 
amended to read: 
 473.142 [SMALL BUSINESSES.] 
 (a) The metropolitan council and agencies specified in 
section 473.143, subdivision 1, may award up to a six percent preference in the 
amount bid for specified goods or services to small targeted group businesses 
designated under section  (b) The council and each agency specified in section 
473.143, subdivision 1, may designate a purchase of goods or services for award 
only to small targeted group businesses designated under section  (c) The council and each agency specified in section 
473.143, subdivision 1, as a condition of awarding a construction contract or 
approving a contract for consultant, professional, or technical services, may 
set goals that require the prime contractor to subcontract a portion of the 
contract to small targeted group businesses designated under section  (d) The council and each agency listed in section 
473.143, subdivision 1, are encouraged to purchase from small targeted group 
businesses designated under section  (e) The council and each agency may adopt rules to 
implement this section. 
 (f) Each council or agency contract must require the 
prime contractor to pay any subcontractor within ten days of the prime 
contractor's receipt of payment from the council or agency for undisputed 
services provided by the subcontractor. The contract must require the prime 
contractor to pay interest of 1-1/2 percent per month or any part of a month to 
the subcontractor on any undisputed amount not paid on time to the 
subcontractor. The minimum monthly interest penalty payment for an unpaid 
balance of $100 or more is $10. For an unpaid balance of less than $100, the 
prime contractor shall pay the actual penalty due to the subcontractor. A 
subcontractor who prevails in a civil action to collect interest penalties from 
a prime contractor must be awarded its costs and disbursements, including 
attorney fees, incurred in bringing the action. 
 (g) This section does not apply to procurement financed 
in whole or in part with federal funds if the procurement is subject to federal 
disadvantaged, minority, or women business enterprise regulations. The council 
and each agency shall report to the commissioner of administration on compliance 
with this section. The information must be reported at the time and in the 
manner requested by the commissioner. 
 Sec. 95. Minnesota Statutes 1996, section 473.556, 
subdivision 14, is amended to read: 
 Subd. 14. [SMALL BUSINESS CONTRACTS.] In exercising its 
powers to contract for the purchase of services, materials, supplies, and 
equipment, pursuant to subdivisions 5, 7, 8 and 10, the commission shall 
designate and set aside each fiscal year for awarding to small businesses 
approximately ten percent of the value of anticipated contracts and subcontracts 
of that kind for that year, in the manner required of the commissioner of 
administration for state procurement contracts pursuant to sections  Sec. 96. Minnesota Statutes 1996, section 480.09, 
subdivision 1, is amended to read: 
 Subdivision 1. The state library shall be maintained in 
the capitol and shall be under the supervision of the justices of the supreme 
court. Notwithstanding chapter  Sec. 97. Minnesota Statutes 1996, section 626.90, 
subdivision 2, is amended to read: 
 Subd. 2. [LAW ENFORCEMENT AGENCY.] (a) The band has the 
powers of a law enforcement agency, as defined in section 626.84, subdivision 1, 
paragraph (h), if all of the requirements of clauses (1) to (4) are met: 
 (1) the band agrees to be subject to liability for its 
torts and those of its officers, employees, and agents acting within the scope 
of their employment or duties arising out of a law enforcement agency function 
conferred by this section, to the same extent as a municipality under chapter 
466, and the band further agrees, notwithstanding section  (2) the band files with the board of peace officer 
standards and training a bond or certificate of insurance for liability coverage 
for the maximum amounts set forth in section 466.04; 
 (3) the band files with the board of peace officer 
standards and training a certificate of insurance for liability of its law 
enforcement officers, employees, and agents for lawsuits under the United States 
Constitution; and 
 (4) the band agrees to be subject to section 13.82 and 
any other laws of the state relating to data practices of law enforcement 
agencies. 
 (b) The band shall enter into mutual aid/cooperative 
agreements with the Mille Lacs county sheriff under section 471.59 to define and 
regulate the provision of law enforcement services under this section. The 
agreements must define the trust property involved in the joint powers 
agreement. 
 (c) The band shall have concurrent jurisdictional 
authority under this section with the Mille Lacs county sheriff's department 
only if the requirements of paragraph (a) are met and under the following 
circumstances: 
 (1) over all persons in the geographical boundaries of 
the property held by the United States in trust for the Mille Lacs band or the 
Minnesota Chippewa tribe; 
 (2) over all Minnesota Chippewa tribal members within the 
boundaries of the Treaty of February 22, 1855, 10 Stat. 1165, in Mille Lacs 
county, Minnesota; and 
 (3) concurrent jurisdiction over any person who commits 
or attempts to commit a crime in the presence of an appointed band peace officer 
within the boundaries of the Treaty of February 22, 1855, 10 Stat. 1165, in 
Mille Lacs county, Minnesota. 
 Sec. 98. Minnesota Statutes 1997 Supplement, section 
626.91, subdivision 2, is amended to read: 
 Subd. 2. [LAW ENFORCEMENT AGENCY.] (a) The community has 
the powers of a law enforcement agency, as defined in section 626.84, 
subdivision 1, paragraph (h), if all of the requirements of clauses (1) to (4) 
are met: 
 (1) the community agrees to be subject to liability for 
its torts and those of its officers, employees, and agents acting within the 
scope of their employment or duties arising out of the law enforcement agency 
powers conferred by this section to the same extent as a municipality under 
chapter 466, and the community further agrees, notwithstanding section  (2) the community files with the board of peace officer 
standards and training a bond or certificate of insurance for liability coverage 
for the maximum amounts set forth in section 466.04; 
 (3) the community files with the board of peace officer 
standards and training a certificate of insurance for liability of its law 
enforcement officers, employees, and agents for lawsuits under the United States 
Constitution; and 
 (4) the community agrees to be subject to section 13.82 
and any other laws of the state relating to data practices of law enforcement 
agencies. 
 (b) The community shall enter into an agreement under 
section 471.59 with the Redwood county sheriff to define and regulate the 
provision of law enforcement services under this section and to provide for 
mutual aid and cooperation. The agreement must identify and describe the trust 
property involved in the agreement. For purposes of entering into this 
agreement, the community shall be considered a "governmental unit" as that term 
is defined in section 471.59, subdivision 1. 
 Sec. 99. [EFFECTIVE DATE.] 
 This article is effective July 1, 
1998." 
 Delete the title and insert: 
 "A bill for an act relating to state agencies; modifying 
procurement procedures; amending Minnesota Statutes 1996, sections 3.225, 
subdivision 2; 3.732, subdivision 6; 3.922, subdivision 5; 3C.10, subdivision 3; 
4A.04; 6.551; 11A.24, subdivision 4; 12.221, subdivision 5; 15.054; 15.061; 
16A.101; 16A.85, subdivision 1; 16B.181; 17.1015; 41A.023; 43A.23, subdivision 
1; 44A.01, subdivision 1; 45.0291; 84.025, subdivision 7; 84.026; 84.0845; 
85A.02, subdivisions 3, 16, and 18; 103F.515, subdivision 3; 116.03, subdivision 
2; 116J.035, subdivision 1; 116J.402; 116J.58, subdivision 2; 116J.68, 
subdivision 2; 116J.966, subdivision 1; 124.14, subdivision 1; 126.151, 
subdivision 2; 129C.10, subdivision 7; 136A.06; 136A.16, subdivision 1; 136A.29, 
subdivision 6; 136F.23; 136F.56, subdivision 5; 136F.581, subdivision 3; 
136F.66; 136F.72, subdivision 3; 136F.96; 137.35, subdivisions 1, 2, and 3; 
144.0742; 144.95, subdivision 5; 161.315, subdivision 4; 161.321, subdivisions 
1, 2, 5, 6, and 7; 161.41, subdivision 2; 179A.23; 198.35, subdivision 1; 
216C.02, subdivision 1; 237.51, subdivision 5a; 241.0221, subdivision 6; 241.27, 
subdivision 2; 246.36; 246.57, subdivisions 1 and 6; 256B.031, subdivision 1; 
256B.04, subdivisions 14 and 15; 298.2211, subdivision 4; 349A.06, subdivision 
1; 349A.07, subdivision 6; 352.03, subdivisions 6 and 16; 354.06, subdivision 
2a; 354.07, subdivision 7; 356A.06, subdivision 7; 446A.12, subdivision 5; 
462A.18, subdivision 2; 471.345, subdivision 8; 473.142; 473.556, subdivision 
14; 480.09, subdivision 1; and 626.90, subdivision 2; Minnesota Statutes 1997 
Supplement, sections 3.225, subdivision 1; 16A.15, subdivision 3; 16B.465, 
subdivision 7; 16E.07, subdivision 9; 17.03, subdivision 12; 41D.03, subdivision 
7; 61B.21, subdivision 1; 85A.02, subdivision 5b; 121.1113, subdivision 2; 
136A.40; 138.35, subdivision 1b; 179A.03, subdivision 14; 216D.03, subdivision 
2; 241.277, subdivision 2; 256B.19, subdivision 2a; 256D.03, subdivision 6; 
353.03, subdivision 3a; 363.073, subdivision 1; and 626.91, subdivision 2; 
proposing coding for new law in Minnesota Statutes, chapters 16C; and 174; 
repealing Minnesota Statutes 1996, sections 16B.06; 16B.07; 16B.08; 16B.09; 
16B.101; 16B.102; 16B.103; 16B.123; 16B.13; 16B.14; 16B.15; 16B.16; 16B.167; 
16B.17; 16B.175; 16B.18, subdivisions 1, 2, and 4; 16B.185; 16B.19; 16B.20, 
subdivisions 1 and 3; 16B.21; 16B.22; 16B.226; 16B.227; 16B.23; 16B.28; 16B.29; 
and 16B.89; Minnesota Statutes 1997 Supplement, sections 16B.18, subdivision 3; 
16B.20, subdivision 2; and 16B.482." 
 With the recommendation that when so amended the bill 
pass.
 The report was adopted. 
 Skoglund from the Committee on Judiciary to which was 
referred: 
 H. F. No. 1072, A bill for an act relating to 
professions; modifying enforcement provisions for the board of psychology; 
providing criminal penalties; amending Minnesota Statutes 1996, section 148.941, 
subdivision 6, and by adding a subdivision; proposing coding for new law in 
Minnesota Statutes, chapter 148. 
 Reported the same back with the following amendments: 
 Delete everything after the enacting clause and insert: 
 "Section 1. Minnesota Statutes 1996, section 148.941, 
subdivision 6, is amended to read: 
 Subd. 6. [VIOLATION.] Persons who engage in the 
unlicensed practice of psychology or who misrepresent themselves as 
psychologists or psychological practitioners are guilty of a gross misdemeanor. 
 Sec. 2. [148.952] [IMMUNITY.] 
 (a) Any person, health care 
facility, business, or organization is immune from civil liability and criminal 
prosecution for reporting in good faith to the board violations or alleged 
violations of the Psychology Practice Act. 
 (b) Any person, health care 
facility, business, or organization is immune from civil liability and criminal 
prosecution for cooperating with the board in good faith in the investigation of 
violations or alleged violations of the Psychology Practice Act." 
 Delete the title and insert: 
 "A bill for an act relating to professions; modifying 
criminal penalties for the unlicensed practice of psychology; providing immunity 
for activities of the board of psychology; amending Minnesota Statutes 1996, 
section 148.941, subdivision 6; proposing coding for new law in Minnesota 
Statutes, chapter 148." 
 With the recommendation that when so amended the bill 
pass.
 The report was adopted. 
 Skoglund from the Committee on Judiciary to which was 
referred: 
 H. F. No. 1116, A bill for an act relating to 
professions; modifying provisions relating to the board of architecture, 
engineering, land surveying, landscape architecture, geoscience, and interior 
design; amending Minnesota Statutes 1996, sections 326.03, subdivision 1; 
326.04; 326.05; 326.07; 326.09; 326.10, subdivisions 2 and 7; 326.13; and 
599.14; proposing coding for new law in Minnesota Statutes, chapter 326; 
repealing Minnesota Statutes 1996, section 326.08. 
 Reported the same back with the following amendments: 
 Pages 1 and 2, delete section 1 
 Pages 8 and 9, delete section 9 
 Renumber the sections in sequence 
 Amend the title as follows: 
 Page 1, line 6, delete "326.03, subdivision 1;" 
 Page 1, line 8, delete everything after the semicolon 
 Page 1, line 9, delete everything before "repealing" 
 With the recommendation that when so amended the bill 
pass.
 The report was adopted. 
 Skoglund from the Committee on Judiciary to which was 
referred: 
 H. F. No. 1414, A bill for an act relating to probate; 
changing provisions on appointment of guardians and conservators; amending 
Minnesota Statutes 1996, section 525.591. 
 Reported the same back with the following amendments: 
 Page 3, line 7, delete the new language 
 Page 3, lines 12 and 13, delete the new language and 
insert "Except as otherwise provided in this section, the 
appointment of a special guardian or conservator may not exceed 30 days in 
duration. A county that is acting under section 626.557, subdivision 10, by 
petitioning for appointment of a special guardian or conservator on behalf of a 
vulnerable adult is not subject to this 30-day limit. 
 Subd. 6. [DURATION LIMITS; 
EXCEPTIONS.] If a petition is filed requesting 
appointment of a general guardian or conservator for a person for whom a special 
guardian or conservator has been appointed, but a final hearing on the petition 
cannot be held after proper notice within 30 days of the appointment of the 
special guardian or conservator because the petition becomes contested, a 
hearing date is not available within the time limit or other good cause exists, 
the appointment of the special guardian or conservator may be extended as 
provided in this subdivision. The court, on its own motion or upon request of 
the petitioner or the special guardian or conservator, may extend the 
appointment to the date of the hearing on the petition. At that time, if the 
court finds that grounds for appointment of the special guardian or conservator 
still exist, the court may further extend the appointment to the date of a final 
decision on the petition. If a special guardian or conservator is appointed for 
the sole purpose of representing the ward or conservatee in litigation or any 
other legal proceeding, other than the pending guardianship or conservatorship 
proceedings, the court may specify that the appointment will last until the 
litigation or proceeding is finally concluded." 
 Page 3, line 14, delete "6" 
and insert "7" and delete "DURATION" and insert 
"FINAL ACCOUNTING" 
 Page 3, line 22, after the semicolon, insert "or" 
 Page 3, delete lines 23 and 24 
 Page 3, line 25, delete "(3)" 
and insert "(2)" 
 With the recommendation that when so amended the bill 
pass.
 The report was adopted. 
 Osthoff from the Committee on Environment, Natural 
Resources and Agriculture Finance to which was referred: 
 H. F. No. 2256, A bill for an act relating to capital 
improvements; appropriating money to restore Camp Rabideau in Chippewa National 
Forest; authorizing state bonds. 
 Reported the same back with the following amendments: 
 Page 1, line 7, delete "$2,500,000" and insert "$50,000" and delete "bond 
proceeds" and insert "general" 
 Page 1, delete line 8 and insert "the city of Blackduck to help restore and stabilize eight 
buildings at Camp Rabideau in" 
 Page 1, delete lines 10 to 17 
 Page 1, line 18, delete "3" and insert "2" 
 Delete the title and insert: 
 "A bill for an act relating to appropriations; 
appropriating money to restore Camp Rabideau in Chippewa National Forest." 
 With the recommendation that when so amended the bill 
pass and be re-referred to the Committee on Economic Development and 
International Trade.
 The report was adopted. 
 Wagenius from the Committee on Transportation and Transit 
to which was referred: 
 H. F. No. 2532, A bill for an act relating to drivers' 
licenses; establishing youth-oriented driver improvement clinics; establishing a 
graduated licensing system with provisional license phase; restricting driving 
privileges for holders of instruction permits and provisional licenses and 
requiring violation-free period before advancement to next license stage; making 
technical changes; amending Minnesota Statutes 1996, sections 120.73, 
subdivision 1; 169.89, subdivision 5; 169.971, subdivision 1, and by adding a 
subdivision; 169.972; 169.973, subdivision 1; 171.01, subdivision 14; 171.04, 
subdivision 1; 171.05, subdivision 2, and by adding subdivisions; 171.06, 
subdivision 1; 171.07, subdivision 1; 171.10, subdivision 1; 171.12, subdivision 
3; 171.16, subdivision 5; 171.17, subdivisions 2 and 3; 171.172; 171.173; 
171.174; 171.20, subdivision 3; 171.27; and 171.39; Minnesota Statutes 1997 
Supplement, sections 171.041; 171.06, subdivisions 2 and 4; and 171.171; 
proposing coding for new law in Minnesota Statutes, chapter 171. 
 Reported the same back with the following amendments: 
 Page 4, line 11, delete "25" 
and insert "18" 
 Page 6, line 4, after "(i)" 
insert "the applicant is 16 or 17 years of age and has a 
previously issued valid license from another state or country or" 
 Page 6, line 6, delete everything after "driving" and insert a semicolon 
 Page 6, delete lines 7 and 8 
 Page 6, lines 9 to 11, delete the new language and strike 
the old language 
 Page 6, line 12, delete "(iii)" and insert "(ii)" 
 Page 6, line 32, after the semicolon, insert "and" 
 Page 6, line 33, delete "(iv)" 
and insert "(iii)" 
 Page 6, line 34, delete "(iii)" and insert "(ii)" 
 Page 9, delete section 10 
 Page 11, line 22, after the semicolon, insert "and" and delete "incurred" 
and insert "been convicted of" 
 Page 11, line 23, delete "and" 
 Page 11, delete lines 24 and 25 
 Page 12, line 14, delete "11:00 
p.m." and insert "12:00 midnight." 
 Page 12, line 18, delete "11:00 
p.m." and insert "12:00 midnight" and before "The" insert "School-sponsored 
social, sporting, and entertainment events and events sponsored by a religious 
organization are deemed to have an educational purpose." 
 Page 12, line 23, delete "items" and insert "clauses" 
 Page 15, delete section 17 
 Page 19, line 32, delete "25" 
and insert "18" 
 Page 21, line 34, delete "27" 
and insert "25" 
 Page 21, delete lines 35 and 36 and insert "Sections 1, 7 to 24, and 26 to 28 are effective January 1, 
1999, and apply to" 
 Renumber the sections in sequence 
 Amend the title as follows: 
 Page 1, line 14, delete "subdivisions" and insert "a 
subdivision" 
 Page 1, line 15, delete "171.07, subdivision 1;" 
 With the recommendation that when so amended the bill 
pass and be re-referred to the Committee on Ways and Means. 
 The report was adopted.
 Wagenius from the Committee on Transportation and Transit 
to which was referred: 
 H. F. No. 2589, A bill for an act relating to 
transportation; providing for certain types of claims; permitting transfer or 
extinguishment of access rights; regulating snow fence easements, highway 
closures, and signs; changing distributions from the highway user tax 
distribution fund; providing for the costs of town highways and bridges; 
permitting conveyances to public bodies; providing for the revision of the state 
transportation plan; regulating private carriers; regulating charges for air 
transportation services; removing a route from the trunk highway system; 
amending Minnesota Statutes 1996, sections 84.63; 117.21; 160.27, by adding a 
subdivision; 160.296, subdivision 1; 160.80, subdivision 1, and by adding a 
subdivision; 161.081, subdivision 1, and by adding a subdivision; 161.082, 
subdivisions 1 and 2a; 161.44, subdivision 1; 174.03, subdivisions 1a and 2; 
221.011, by adding a subdivision; 221.0251, subdivisions 1, 2, 3, 5, and by 
adding subdivisions; 221.031, subdivision 6; 221.034, subdivisions 1 and 5; 
222.63, subdivision 4; 270.077; and 360.024; Minnesota Statutes 1997 Supplement, 
section 3.736, subdivision 3; repealing Minnesota Statutes 1996, section 
161.115, subdivision 219. 
 Reported the same back with the following amendments: 
 Delete everything after the enacting clause and insert: 
 
 
 Section 1. Minnesota Statutes 1996, section 84.63, is 
amended to read: 
 84.63 [CONVEYANCE OF INTERESTS IN LANDS TO STATE AND 
FEDERAL GOVERNMENTS.] 
 Notwithstanding any existing law to the contrary, the 
commissioner of natural resources is hereby authorized on behalf of the state to 
convey to the United States or to the state of Minnesota or any of its 
subdivisions, upon state-owned lands under the administration of the 
commissioner of natural resources, permanent or temporary easements for 
specified periods or otherwise for trails, highways, 
roads  Sec. 2. Minnesota Statutes 1996, section 117.21, is 
amended to read: 
 117.21 [EASEMENT  When the right to establish a public road is acquired by 
the state, or by any of its agencies or political subdivisions, there  and maintain such fences shall be considered in awarding 
damages, and any award shall be conclusively presumed to include the damages, if 
any, caused by the right to erect and maintain such fences Sec. 3. Minnesota Statutes 1996, section 160.27, is 
amended by adding a subdivision to read: 
 Subd. 7. [TRUNK HIGHWAY 
CLOSURE; AUTHORITY, NOTICE, CIVIL PENALTY.] (a) The 
commissioner may restrict the use of, or close, any state trunk highway for the 
protection and safety of the public or for the protection of the highway from 
damage during and after storms if there is danger of the road becoming 
impassable or if visibility is so limited that safe travel is unlikely. 
 (b) To notify the public that a 
trunk highway is closed or its use restricted, the commissioner shall give 
notice by one or more of the following methods: 
 (1) erect suitable barriers or 
obstructions on the highway; 
 (2) post warnings or notices of 
the closing or restricting of a trunk highway; 
 (3) place signs to warn, detour, 
direct, or otherwise control traffic on the highway; or 
 (4) place personnel to warn, 
detour, direct, or otherwise control traffic on the highway. 
 (c) A person is civilly liable for 
rescue costs if the person (1) fails to obey the direction or instruction of 
authorized personnel at the location of the closed highway, or (2) drives over, 
through, or around a barricade, fence, or obstruction erected to prevent traffic 
from passing over a portion of a highway closed to public travel. "Civilly 
liable for rescue costs" means that the person is liable to a state agency or 
political subdivision for costs incurred for the purpose of rescuing the person, 
any passengers, or the vehicle. Civil liability may be imposed under this 
subdivision in addition to the misdemeanor penalty imposed under subdivision 5. 
However, civil liability must not exceed $10,000. A fine paid by a defendant in 
a misdemeanor action that arose from the same violation may not be applied 
toward payment of the civil liability imposed under this subdivision. 
 (d) A state agency or political 
subdivision that incurs costs as described in paragraph (c) may bring an action 
to recover the civil liability and related legal, administrative, and court 
costs. A civil action may be commenced as is any civil action. 
 Sec. 4. Minnesota Statutes 1996, section 160.296, 
subdivision 1, is amended to read: 
 Subdivision 1. [PROCEDURE.] (a) A person who desires a 
specific service sign panel shall request the commissioner of transportation to 
install the sign. The commissioner of transportation may grant the request if 
the applicant qualifies for the sign panel and if space is available. All signs 
shall be fabricated, installed, maintained, replaced and removed by the 
commissioner of transportation. The applicant shall pay a fee to the 
commissioner of transportation to cover all costs for fabricating, installing, 
maintaining, replacing and removing.  (b) If the applicant desires to display a business panel, 
the business panel for each specific service sign panel shall be supplied by the 
applicant. All costs to fabricate business panels shall be paid by the 
applicant. All business panels shall be installed and removed by the appropriate 
road authority. The costs for installing and removing business sign panels on 
specific service signs located on nonfreeway trunk highways are included in the 
fee specified in paragraph (a). If a business panel is stolen or damaged beyond 
repair, the applicant shall supply a new business panel paid for by the 
applicant. 
 Sec. 5. Minnesota Statutes 1996, section 160.80, 
subdivision 1, is amended to read: 
 Subdivision 1. [COMMISSIONER MAY ESTABLISH PROGRAM.] (a) 
The commissioner of transportation may establish a sign franchise program for 
the purpose of providing on the right-of-way of interstate and controlled-access 
trunk highways specific information on gas, food, camping, and lodging, for the 
benefit of the motoring public. 
 (b) The sign franchise program must include urban 
interstate highways.  Sec. 6. Minnesota Statutes 1996, section 160.80, is 
amended by adding a subdivision to read: 
 Subd. 1a. [ELIGIBILITY 
CRITERIA FOR BUSINESS PANELS.] (a) To be eligible for a 
business panel on a logo sign panel, a business establishment must: 
 (1) be open for business; 
 (2) have a sign on site that both 
identifies the business and is visible to motorists; 
 (3) be open to everyone, 
regardless of race, religion, color, age, sex, national origin, creed, marital 
status, sexual orientation, or disability; 
 (4) not impose a cover charge or 
otherwise require customers to purchase additional products or services; and 
 (5) meet the appropriate criteria 
in paragraphs (b) to (e). 
 (b) Gas businesses must provide 
vehicle services including fuel and oil; restroom facilities and drinking water; 
continuous, staffed operation at least 12 hours a day, seven days a week; and 
public access to a telephone. 
 (c) Food businesses must serve at 
least two meals a day during normal mealtimes of breakfast, lunch, and dinner; 
provide a continuous, staffed food service operation at least ten hours a day, 
seven days a week except holidays as defined in section 645.44, subdivision 5, 
and except as provided for seasonal food service businesses; provide seating 
capacity for at least 20 people; serve meals prepared on the premises, excluding 
food service businesses that only reheat prepackaged, ready-to-eat food; and 
possess any required state or local licensing or approval. Seasonal food service 
businesses must provide a continuous, staffed food service operation at least 
ten hours a day, seven days a week, during their months of operation. 
 (d) Lodging businesses must 
include sleeping accommodations, provide public access to a telephone, and 
possess any required state or local licensing or approval. 
 (e) Camping businesses must 
include sites for camping, include parking accommodations for each campsite, 
provide sanitary facilities and drinking water, and possess any required state 
or local licensing or approval. 
 (f) Businesses that do not meet 
the appropriate criteria in paragraphs (b) to (e) but that have a signed lease 
as of January 1, 1998, may retain the business panel until December 31, 2005, or 
until they withdraw from the program, whichever occurs first, provided they 
continue to meet the criteria in effect in the department's contract with the 
logo sign vendor on August 1, 1995. After December 31, 2005, or after 
withdrawing from the program, a business must meet the appropriate criteria in 
paragraphs (a) to (e) to qualify for a business panel. 
 (g) Seasonal businesses must 
indicate to motorists when they are open for business by either putting the full 
months of operation directly on the business panel or by having a "closed" 
plaque applied to the business panel when the business is closed for the 
season. 
 (h) The maximum distance that an 
eligible business in Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or 
Washington county can be located from the interchange is: for gas businesses, 
one mile; for food businesses, two miles; for lodging businesses, three miles; 
and for camping businesses, ten miles. 
 (i) The maximum distance that an 
eligible business in any other county can be located from the interchange shall 
not exceed three miles in either direction, except that if facilities described 
in paragraphs (b) to (e) are not available within the three-mile limit, the 
limit of eligibility may be extended in three-mile increments until one or more 
of those facilities are reached. The maximum distance that eligible facilities 
can be located from the interchange to qualify for a business panel is 15 miles 
in either direction. 
 (j) Logo sign panels must be 
erected so that motorists approaching an interchange view the panels in the 
following order: camping, lodging, food, gas. 
 (k) If there is insufficient space 
on a logo sign panel to display all eligible businesses for a specific type of 
service, the businesses closest to the interchange have priority over businesses 
farther away from the interchange. 
 Sec. 7. Minnesota Statutes 1996, section 161.082, 
subdivision 2a, is amended to read: 
 Subd. 2a. [TOWN BRIDGES AND CULVERTS; TOWN ROAD ACCOUNT.] 
(a) An amount equal to  (b) In addition, if a culvert 
that replaces a deficient bridge is in a county comprehensive water plan 
approved by the board of water and soil resources and the department of natural 
resources, the costs of the culvert and roadway grading other than surfacing are 
eligible for replacement funds up to the cost of constructing a replacement 
bridge. 
 (c) The expenditures on  (d) The town bridge account may be 
used to pay the costs to abandon an existing bridge that is deficient and in 
need of replacement, but where no replacement will be made. It may also be used 
to pay the costs to construct a road or street to facilitate the abandonment of 
an existing bridge determined by the commissioner to be deficient, if the 
commissioner determines that construction of the road or street is more cost 
efficient than replacing the existing bridge. 
 (e) When bridge approach 
construction work exceeds $10,000 in costs, or when the county engineer 
determines that the cost of the replacement culverts alone will not exceed 
$20,000, the town shall be eligible for financial assistance from the town 
bridge account. Financial assistance shall be requested by resolution of the 
county board and shall be limited to: 
 (1) 100 percent of the cost of the bridge approach work 
that is in excess of $10,000; or 
 (2) 100 percent of the cost of the replacement culverts 
when the cost does not exceed $20,000 and the town board agrees to be 
responsible for all the other costs, which may include costs for structural 
removal, installation, and permitting. The replacement structure design and 
costs shall be approved and certified by the county engineer, but need not be 
subsequently approved by the department of transportation. 
 (f) An amount equal to 47.5 
percent of the county turnback account must be set aside as a town road account 
and distributed as provided in section 162.081. 
 Sec. 8. Minnesota Statutes 1996, section 169.26, 
subdivision 1, is amended to read: 
 Subdivision 1. [REQUIREMENTS.] (a) When any person 
driving a vehicle approaches a railroad grade crossing under any of the 
circumstances stated in this paragraph, the driver shall stop the vehicle not 
less than ten feet from the nearest railroad track and shall not proceed until 
safe to do so. These requirements apply when: 
 (1) a clearly visible electric or mechanical signal 
device warns of the immediate approach of a railroad train; or 
 (2)  (b) The fact that a moving train approaching a railroad 
grade crossing is visible from the crossing is prima facie evidence that it is 
not safe to proceed. 
 (c) The driver of a vehicle shall stop and remain stopped 
and not traverse the grade crossing when a human flagger signals the approach or 
passage of a train or when a crossing gate is lowered to 
warn of the immediate approach or passage of a railroad train. No person may 
(1) drive a vehicle past a flagger at a railroad 
crossing until the flagger signals that the way is clear to proceed, or (2) drive a vehicle past a lowered crossing gate. 
 Sec. 9. Minnesota Statutes 1996, section 174.03, 
subdivision 1a, is amended to read: 
 Subd. 1a. [REVISION OF STATE TRANSPORTATION PLAN.] The 
commissioner shall revise the state transportation plan by January 1, 1996, January 1, 2000, and, if the 
requirements of clauses (1) and (2) have been met in the previous revision, 
by January 1 of  (1) incorporate the goals of the state transportation 
system in section 174.01; and 
 (2) establish objectives, policies, and strategies for 
achieving those goals. 
 Sec. 10. Minnesota Statutes 1996, section 174.03, 
subdivision 2, is amended to read: 
 Subd. 2. [IMPLEMENTATION OF PLAN.] After the adoption and 
each revision of the statewide transportation plan, the commissioner  Sec. 11. Minnesota Statutes 1996, section 221.034, 
subdivision 1, is amended to read: 
 Subdivision 1. [NOTICE REQUIRED.] At the earliest 
practicable moment, each person who transports hazardous materials, including 
hazardous wastes, shall give notice in accordance with subdivision 2 after each 
incident that occurs during the course of transportation including loading, 
unloading, and temporary storage, in which as a direct result of hazardous 
materials: 
 (1) a person is killed; 
 (2) a person receives injuries requiring hospitalization; 
 (3) estimated carrier or other property damage exceeds 
$50,000; 
 (4) an evacuation of the general public occurs lasting 
one or more hours; 
 (5) one or more major transportation arteries or 
facilities are closed or shut down for one hour or more; 
 (6) the operational flight pattern or routine of an 
aircraft is altered; 
 (7) fire, breakage, spillage, or suspected radioactive 
contamination occurs involving shipment of radioactive material; 
 (8) fire, breakage, spillage, or suspected contamination 
occurs involving shipment of etiologic agents;  (9) a situation exists of such a nature that, in the 
judgment of the carrier, it should be reported in accordance with subdivision 2 
even though it does not meet the criteria of clause (1), (2), or (3), but a 
continuing danger to life exists at the scene of the incident; or 
 (10) there has been a release of a 
marine pollutant in a quantity exceeding 450 liters (119 gallons) for liquids or 
450 kilograms (882 pounds) for solids. 
 Sec. 12. Minnesota Statutes 1996, section 221.034, 
subdivision 5, is amended to read: 
 Subd. 5. [DISCHARGES NOT APPLICABLE.] Except as provided 
in subdivision 6, the requirements of subdivision 3 do not apply to incidents 
involving the unintentional release of hazardous materials being transported 
under the following proper shipping names: 
 (1) consumer commodity; 
 (2) battery, electric storage, wet, filled with acid or 
alkali; 
 (3) paint, enamel, lacquer, stain, shellac or varnish 
aluminum, bronze, gold, wood filler, and liquid or lacquer base liquid when 
shipped in packagings of five gallons or less; or 
 (4) materials prepared and 
transported as a limited quantity according to Code of Federal Regulations, 
title 49, subchapter C. 
 Sec. 13. Minnesota Statutes 1996, section 270.077, is 
amended to read: 
 270.077 [TAXES CREDITED TO 
STATE AIRPORTS FUND  Sec. 14. Minnesota Statutes 1996, section 360.024, is 
amended to read: 
 360.024 [AIR TRANSPORTATION  The commissioner shall charge users of air transportation 
services provided by the commissioner for  Sec. 15. Laws 1997, chapter 159, article 2, section 51, 
subdivision 1, is amended to read: 
 Subdivision 1. [STUDY.] The commissioner of 
transportation, through the division of railroads and waterways, shall conduct a 
study of the potential of utilizing freight rail corridors  Sec. 16. [REPEALER.] 
 Minnesota Statutes 1996, section 
161.115, subdivision 219, is repealed when the transfer of jurisdiction of a 
portion of legislative route No. 288 agreed to by the commissioner of 
transportation and the Anoka county board and a copy of the agreement, signed by 
the commissioner and the chair of the Anoka county board, is filed in the office 
of the commissioner. 
 Sec. 17. [INSTRUCTION TO THE REVISOR.] 
 The revisor of statutes shall 
delete the route identified in section 16 in the next publication of Minnesota 
Statutes unless the commissioner of transportation informs the revisor that the 
conditions required to transfer the route were not satisfied. 
 Sec. 18. [EFFECTIVE DATE.] 
 Section 15 is effective the day 
following final enactment. 
 
 
 Section 1. [16B.171] [EXCEPTION FOR FEDERAL 
TRANSPORTATION CONTRACTS.] 
 Notwithstanding section 16B.17 or 
other law to the contrary, the commissioner of transportation may, when required 
by a federal agency entering into an intergovernmental contract, negotiate 
contract terms providing for full or partial prepayment to the federal agency 
before work is performed or services are provided. 
 Sec. 2. Minnesota Statutes 1996, section 160.18, 
subdivision 1, is amended to read: 
 Subdivision 1. [CULVERT ON EXISTING HIGHWAYS.] Except 
when the easement of access has been acquired,  Sec. 3. Minnesota Statutes 1996, section 161.115, 
subdivision 38, is amended to read: 
 Subd. 38. [ROUTE NO. 107.] Beginning at the terminus of 
Route No. 10 on the westerly limits on the city of Minneapolis, thence extending 
in an easterly direction to a point  Sec. 4. Minnesota Statutes 1996, section 161.115, 
subdivision 87, is amended to read: 
 Subd. 87. [ROUTE NO. 156.] Beginning at a point on Route 
No.  Sec. 5. Minnesota Statutes 1996, section 165.03, is 
amended to read: 
 165.03 [STRENGTH OF BRIDGES; INSPECTIONS.] 
 Subdivision 1. [STANDARDS GENERALLY.] Each bridge, 
including a privately owned bridge, must conform to the strength, width, 
clearance, and safety standards imposed by the commissioner for the connecting 
highway or street. This subdivision applies to a bridge that is constructed 
after August 1, 1989, on any public highway or street. The bridge must have 
sufficient strength to support with safety the maximum vehicle weights allowed 
under section 169.825 and must have the minimum width specified in section 
165.04, subdivision 3. 
 Subd. 2. [INSPECTION AND INVENTORY RESPONSIBILITIES; 
RULES; FORMS.] The commissioner of transportation shall adopt official inventory 
and bridge inspection report forms for use in making bridge inspections by the 
owners or highway authorities specified by this 
subdivision. Bridge inspections shall be made at regular intervals, not to 
exceed two years, by the following  (a) The commissioner of transportation for all bridges 
located wholly or partially within or over the right-of-way of a state trunk 
highway. 
 (b) The county highway engineer for all bridges located 
wholly or partially within or over the right-of-way of any county or township 
road, or any street within a municipality which does not have a city engineer 
regularly employed. 
 (c) The city engineer for all bridges located wholly or 
partially within or over the right-of-way of any street located within or along 
municipal limits. 
 (d) The commissioner of transportation in case of a toll 
bridge that is used by the general public and that is not inspected and certified under subdivision 
6; provided, that the commissioner of transportation may assess the owner 
for the costs of such inspection. 
 (e) The owner of a bridge over a 
public highway or street or that carries a roadway designated for public use by 
a public authority, if not required to be inventoried and inspected under clause 
(a), (b), (c), or (d). 
 The commissioner of transportation shall prescribe the 
standards for bridge inspection and inventory by rules. The  Subd. 3. [COUNTY INVENTORY AND INSPECTION RECORDS AND 
REPORTS.] The county engineer shall maintain a complete inventory record of all 
bridges as set forth in subdivision 2, clause (b), with the inspection reports thereof, and shall certify 
annually to the commissioner, as prescribed by the commissioner, that 
inspections have been made at regular intervals not to exceed two years. A 
report of the inspections shall be filed annually, on or before February 15 of 
each year, with the county auditor or  Subd. 4. [MUNICIPAL INVENTORY AND INSPECTION RECORDS AND 
REPORTS.] The city engineer shall maintain a complete inventory record of all 
bridges as set forth in subdivision 2, clause (c), with the inspection reports thereof, and shall certify 
annually to the commissioner, as prescribed by the commissioner, that 
inspections have been made at regular intervals not to exceed two years. A 
report of the inspections shall be filed annually, on or before February 15 of 
each year, with the governing body of the municipality. The report shall contain 
recommendations for the correction of, or legal posting of load limits on any 
bridge or structure that is found to be understrength or unsafe. 
 Subd. 5. [AGREEMENTS.] Agreements may be made among the 
various units of governments, or between governmental units and qualified 
engineering personnel to carry out the responsibilities for the bridge 
inspections and reports, as established by subdivision 2. 
 Subd. 6. [ Subd. 7. [DEPARTMENT OF 
NATURAL RESOURCES BRIDGES.] (a) Notwithstanding 
subdivision 2, the commissioners of transportation and natural resources shall 
negotiate a memorandum of understanding that governs the inspection of bridges 
owned, operated, or maintained by the commissioner of natural resources. 
 (b) The memorandum of 
understanding must provide for: 
 (1) the inspection and inventory 
of bridges subject to federal law or regulations; 
 (2) the frequency of inspection of 
bridges described in paragraph (a); and 
 (3) who may perform inspections 
required under the memorandum of understanding. 
 Sec. 6. Minnesota Statutes 1996, section 174A.06, is 
amended to read: 
 174A.06 [CONTINUATION OF RULES.] 
 Orders and directives  (1)  The  Sec. 7. Minnesota Statutes 1996, section 574.26, 
subdivision 1a, is amended to read: 
 Subd. 1a. [ (b) At the discretion of the 
commissioner of transportation, sections 574.26 to 574.32 do not apply to any 
projects of the department of transportation (1) costing less than $75,000, or 
(2) involving the permanent or semipermanent installation of heavy machinery, 
fixtures, or other capital equipment to be used primarily for maintenance or 
repair. 
 Sec. 8. [SALE OF TAX-FORFEITED LAND; HENNEPIN COUNTY.] 
 (a) Notwithstanding Minnesota 
Statutes, sections 92.45 and 282.018, subdivision 1, Hennepin county may sell to 
the Minnesota department of transportation the tax-forfeited land bordering 
public water that is described in paragraph (c). 
 (b) The conveyance must be in the 
form approved by the attorney general. 
 (c) The land that may be conveyed 
is located in the city of Champlin, Hennepin county and is described as: That 
part of Lot 11, Block 5, Auditor's Subdivision No. 15, according to the plat 
thereof on file and of record in the office of the County Recorder in and for 
Hennepin County, Minnesota, lying south of a line run parallel with and distant 
43 feet north of the south line of Government Lot 3, Section 19, Township 120 
North, Range 21 West and lying east of a line run parallel with and distant 36.5 
feet east of the west line of said Government Lot 3; together with all right of 
access, being the right of ingress to and egress from said Lot 11 to U.S. 
Highway No. 169 and Hayden Lake Road. 
 Subject to permanent easement for 
sanitary sewers granted to the metropolitan council on March 2, 1995, by the 
Hennepin county auditor. Subject to easements of record. 
 Sec. 9. [REPEALER.] 
 Minnesota Statutes 1996, section 
161.115, subdivision 57, is repealed. 
 Sec. 10. [EFFECTIVE DATE.] 
 Subdivision 1. [DESCRIPTION OF 
ROUTE NO. 107 CHANGED; EFFECTIVE DATE.] Section 3 is 
effective when an agreement to transfer jurisdiction of a portion of marked 
Route No. 52 has been signed by the commissioner of transportation and the chair 
of the Hennepin county board and filed in the office of the commissioner. 
 Subd. 2. [DESCRIPTION OF ROUTE 
NO. 156 CHANGED; EFFECTIVE DATE.] Section 4 is effective 
when the transfer of jurisdiction of a portion of the old route is agreed to by 
the commissioner of transportation and Hennepin county and a copy of the 
agreement, signed by the commissioner and the chair of the Hennepin county 
board, has been filed in the office of the commissioner. 
 Subd. 3. [ROUTE NO. 126 
DISCONTINUED; EFFECTIVE DATE.] Section 9 is effective 
when the transfer of jurisdiction of legislative Route No. 126 is agreed to by 
the commissioner of transportation and Ramsey county and a copy of the 
agreement, signed by the commissioner and the chair of the Ramsey county board, 
has been filed in the office of the commissioner. 
 Subd. 4. [INSTRUCTION TO 
REVISOR.] The revisor of statutes shall delete the route 
identified in subdivision 3 and change the description of each route identified 
in subdivisions 1 and 2 in the next publication of Minnesota Statutes unless the 
commissioner of transportation informs the revisor that the conditions required 
to transfer a particular route were not satisfied. 
 Subd. 5. [OTHER PROVISIONS.] 
Section 1 is effective the day following final enactment. 
Sections 2 and 7 are effective July 1, 1998." 
 Delete the title and insert: 
 "A bill for an act relating to transportation; 
authorizing advance payment when required by federal government for 
transportation project; providing for payment for costs of certain culverts when 
abutting landowner is a road authority; providing for bridge inspections; 
permitting transfer of extinguishment of access rights; regulating snow fence 
easements, highway closures, and signs; providing for the costs of town highways 
and bridges; providing for revisions of state transportation plan; transferring 
certain rules from transportation regulation board to commissioner of 
transportation; regulating charges for air transportation services; modifying 
contractor bond requirements for certain transportation projects; authorizing 
conveyance of certain tax-forfeited and acquired land that borders public water 
or natural wetlands in Hennepin county; removing routes from trunk highway 
system and changing descriptions of certain routes; requiring certain 
representation in study of commuter rail service; amending Minnesota Statutes 
1996, sections 84.63; 117.21; 160.18, subdivision 1; 160.27, by adding a 
subdivision; 160.296, subdivision 1; 160.80, subdivision 1, and by adding a 
subdivision; 161.082, subdivision 2a; 161.115, subdivisions 38 and 87; 165.03; 
169.26, subdivision 1; 174.03, subdivisions 1a and 2; 174A.06; 221.034, 
subdivisions 1 and 5; 270.077; 360.024; and 574.26, subdivision 1a; Laws 1997, 
chapter 159, article 2, section 51, subdivision 1; proposing coding for new law 
in Minnesota Statutes, chapter 16B; repealing Minnesota Statutes 1996, section 
161.115, subdivisions 57 and 219." 
 With the recommendation that when so amended the bill 
pass and be re-referred to the Committee on Ways and Means. 
 The report was adopted. 
 Osthoff from the Committee on Environment, Natural 
Resources and Agriculture Finance to which was referred: 
 H. F. No. 2722, A bill for an act relating to the 
environment; providing penalties for violations of underground storage tank 
statutes and rules; amending Minnesota Statutes 1996, sections 115.071, by 
adding a subdivision; and 116.073, subdivisions 1 and 2. 
 Reported the same back with the following amendments: 
 Page 3, lines 15, 19, 22, 25, and 28, delete everything 
after "violation" 
 Page 3, lines 16, 23, 26, and 29, delete everything 
before " relating" 
 With the recommendation that when so amended the bill 
pass.
 The report was adopted. 
 Osthoff from the Committee on Environment, Natural 
Resources and Agriculture Finance to which was referred: 
 H. F. No. 2724, A bill for an act relating to natural 
resources; providing for the acquisition of critical aquatic habitat; modifying 
commercial netting provisions; permitting the commissioner to take catfish in 
certain waters; modifying minnow retailer provisions; modifying turtle license 
provisions; amending Minnesota Statutes 1996, sections 86A.04; 97C.041; 97C.501, 
subdivision 1; and 97C.605, subdivisions 1 and 2; Minnesota Statutes 1997 
Supplement, sections 97A.475, subdivision 30; and 97C.501, subdivision 2; 
proposing coding for new law in Minnesota Statutes, chapter 97C. 
 Reported the same back with the following amendments: 
 Page 1, after line 13, insert: 
 "Section 1. Minnesota Statutes 1996, section 84.83, 
subdivision 3, is amended to read: 
 Subd. 3. [PURPOSES FOR THE ACCOUNT.] The money deposited 
in the account and interest earned on that money may be expended only as 
appropriated by law for the following purposes: 
 (1) for a grant-in-aid program to counties and 
municipalities for construction and maintenance of snowmobile trails, including maintenance of trails on lands and waters of 
Voyageurs National Park; 
 (2) for acquisition, development, and maintenance of 
state recreational snowmobile trails; 
 (3) for snowmobile safety programs; and 
 (4) for the administration and enforcement of sections 
84.81 to 84.90. 
 Sec. 2. Minnesota Statutes 1996, section 84.83, 
subdivision 4, is amended to read: 
 Subd. 4. [PROVISIONS APPLICABLE TO FUNDING RECIPIENTS.] 
(a) Recipients of Minnesota trail assistance program 
funds must be the same protection and be held to the same standard of liability 
as a political subdivision under chapter 466 for activities associated with the 
administration, design, construction, maintenance, and grooming of snowmobile 
trails. 
 (b) Recipients of Minnesota trail 
assistance program funds who maintain ice trails on waters of Voyageurs National 
Park are expressly immune from liability under section 466.03, subdivision 
6e." 
 Page 2, after line 3, insert: 
 "Sec. 4. [86B.107] [REMOVAL OF VEHICLES FROM STATE 
WATERS.] 
 Subdivision 1. [DEFINITIONS.] 
(a) For purposes of this section, "vehicle" has the 
meaning given to "motor vehicle" in section 97A.015, subdivision 32, and the 
meaning given to "motorboat" in section 86B.005, subdivision 9. 
 (b) For purposes of this section, 
"owner" means registered owner, last registered owner, or actual owner of a 
vehicle if the vehicle is not registered. 
 Subd. 2. [REMOVAL 
REQUIREMENT.] (a) The owner of a vehicle shall be 
responsible to remove the vehicle from waters of the state unless the vehicle is 
permitted under section 86B.121, or otherwise exempt from removal. Removal shall 
be completed within 30 days of the vehicle entering the water or being 
discovered in the water, unless the owner is notified in writing by the county 
having jurisdiction that the removal must be completed sooner. The owner of the 
vehicle shall report that the vehicle is submerged in a body of water, and the 
date and circumstances surrounding it becoming submerged, to the sheriff of the 
county where the body of water is located within 48 hours of the vehicle 
entering the water. 
 (b) If the vehicle is not removed 
pursuant to paragraph (a), the county in whose jurisdiction the lake or 
watercourse exists shall remove the vehicle. The owner of the vehicle shall be 
subject to a civil penalty for all costs incurred in the removal of the vehicle. 
If the penalty is not paid within 60 days of notification of the owner the 
county that incurs costs as described in this section may bring an action to 
recover the costs at two times the actual cost of removal. 
 (c) The owner of the vehicle is 
not responsible for removal of the vehicle if the vehicle was used without their 
knowledge and the driver or operator of the vehicle can be determined. 
 Sec. 5. Minnesota Statutes 1996, section 97A.431, 
subdivision 4, is amended to read: 
 Subd. 4. [SEPARATE SELECTION; ELIGIBILITY.] (a) The 
commissioner may conduct a separate selection for up to 20 percent of the moose 
licenses to be issued for an area. Only owners of, and tenants living on, at 
least 160 acres of agricultural or grazing land in the area, and their family 
members, are eligible for the separate selection under 
this paragraph.  (b) The commissioner must conduct 
a separate selection for five percent of the moose licenses to be issued each 
year. Only individuals who have applied at least ten times for a moose license 
and who have never received a license are eligible for this separate selection. 
An individual applying for a license under this paragraph may designate 
individuals who have not made at least ten unsuccessful applications for a moose 
license as members of the applicant's hunting party and must certify that the 
applicant has not accepted any compensation from those individuals in exchange 
for including them on the application. 
 (c) The commissioner may by 
rule establish criteria for: 
 (1) determining eligible 
family members under  (2) verifying that an individual 
has made at least ten unsuccessful applications for the purposes of paragraph 
(b). 
 (d) A person who is unsuccessful 
in a separate selection under this subdivision must be included in the selection 
for the remaining licenses." 
 Renumber the sections in sequence 
 Amend the title as follows: 
 Page 1, line 7, after the semicolon, insert "modifying 
provisions of trail grant-in-aid funding; requiring removal of vehicles from 
state waters; modifying provisions for issuing moose licenses; providing civil 
penalties;" 
 Page 1, line 8, after "sections" insert "84.83, 
subdivisions 3 and 4;" and after "86A.04;" insert "97A.431, subdivision 4;" 
 Page 1, line 12, delete "chapter" and insert "chapters 
86B; and" 
 With the recommendation that when so amended the bill 
pass. 
 The report was adopted.
 Kahn from the Committee on Governmental Operations to 
which was referred: 
 H. F. No. 2814, A bill for an act relating to health; 
establishing a minimum definition of durable medical equipment; requiring 
disclosure of covered medical equipment and supplies; proposing coding for new 
law in Minnesota Statutes, chapter 62Q. 
 Reported the same back with the following amendments: 
 Delete everything after the enacting clause and insert: 
 "Section 1. [62Q.66] [DURABLE MEDICAL EQUIPMENT 
COVERAGE.] 
 No health plan company that covers 
durable medical equipment may utilize medical coverage criteria for durable 
medical equipment that limits coverage solely to equipment used in the home. 
 Sec. 2. [62Q.67] [DISCLOSURE OF COVERED DURABLE MEDICAL 
EQUIPMENT.] 
 Subdivision 1. [DISCLOSURE.] 
A health plan company that covers durable medical 
equipment shall provide enrollees, and upon request prospective enrollees, 
written disclosure that includes the information set forth in subdivision 2. The 
health plan company may include the information in the member contract, 
certificate of coverage, schedule of payments, member handbook, or other written 
enrollee communication. 
 Subd. 2. [INFORMATION TO BE 
DISCLOSED.] A health plan company that covers durable 
medical equipment shall disclose the following information: 
 (1) general descriptions of the 
coverage for durable medical equipment, level of coverage available, and 
criteria and procedures for any required prior authorizations; and 
 (2) the address and telephone 
number of a health plan representative whom an enrollee may contact to obtain 
specific information verbally, or upon request in writing, about prior 
authorization including criteria used in making coverage decisions and 
information on limitations or exclusions for durable medical equipment. 
 Sec. 3. [EFFECTIVE DATE; APPLICATION.] 
 Sections 1 and 2 are effective 
January 1, 1999, and apply to health plans issued, renewed, or continued as 
defined in Minnesota Statutes, section 60A.02, subdivision 2a, to provide 
coverage to a Minnesota resident on or after that date." 
 Amend the title as follows: 
 Page 1, line 2, delete everything after the semicolon 
 Page 1, line 3, delete everything before "requiring" and 
insert "regulating coverage of durable medical equipment;" 
 With the recommendation that when so amended the bill 
pass. 
 The report was adopted. 
 Carlson from the Committee on Education to which was 
referred: 
 H. F. No. 2874, A bill for an act relating to education; 
repealing the Minnesota education finance act of 1992; repealing Minnesota 
Statutes 1996, sections 124A.697; 124A.698; 124A.70; 124A.71; 124A.711, 
subdivision 1; 124A.72; and 124A.73; Minnesota Statutes 1997 Supplement, section 
124A.711, subdivision 2; and Laws 1992, chapter 499, article 7, section 31. 
 Reported the same back with the following amendments: 
 Delete everything after the enacting clause and insert: 
 
 
 Section 1. Minnesota Statutes 1997 Supplement, section 
121.904, subdivision 4a, is amended to read: 
 Subd. 4a. [LEVY RECOGNITION.] (a) "School district tax 
settlement revenue" means the current, delinquent, and manufactured home 
property tax receipts collected by the county and distributed to the school 
district, including distributions made pursuant to section 279.37, subdivision 
7, and excluding the amount levied pursuant to section 124.914, subdivision 1. 
 (b) In June of each year, the school district shall 
recognize as revenue, in the fund for which the levy was made, the lesser of: 
 (1) the May, June, and July school district tax 
settlement revenue received in that calendar year; or 
 (2) the sum of the state aids and credits enumerated in 
section 124.155, subdivision 2, which are for the fiscal year payable in that 
fiscal year plus an amount equal to the levy recognized as revenue in June of 
the prior year plus 31 percent of the amount of the levy certified in the prior 
calendar year according to section 124A.03, subdivision 2; or 
 (3)(i)  (ii) 31 percent of the referendum levy certified in the 
prior calendar year according to section 124A.03, subdivision 2; plus 
 (iii) the entire amount of the levy certified in the 
prior calendar year according to sections 124.315, subdivision 4; 124.912, 
subdivisions 1, paragraph (2), 2, and 3; 124.916, subdivisions 1, 2, and 3, 
paragraphs (4), (5), and (6); and 124.918, subdivision 6. 
 (c) In July of each year, the school district shall 
recognize as revenue that portion of the school district tax settlement revenue 
received in that calendar year and not recognized as revenue for the previous 
fiscal year pursuant to clause (b). 
 (d) All other school district tax settlement revenue 
shall be recognized as revenue in the fiscal year of the settlement. Portions of 
the school district levy assumed by the state, including prior year adjustments 
and the amount to fund the school portion of the reimbursement made pursuant to 
section 273.425, shall be recognized as revenue in the fiscal year beginning in 
the calendar year for which the levy is payable. 
 Sec. 2. Minnesota Statutes 1996, section 121.908, 
subdivision 2, is amended to read: 
 Subd. 2. Each district shall submit to the commissioner 
by  Sec. 3. Minnesota Statutes 1996, section 121.908, 
subdivision 3, is amended to read: 
 Subd. 3. By  Sec. 4. Minnesota Statutes 1996, section 123.39, 
subdivision 1, is amended to read: 
 Subdivision 1. The board may provide for the 
transportation of pupils to and from school and for any other purpose. The board 
may also provide for the transportation of pupils to schools in other districts 
for grades and departments not maintained in the district, including high 
school, at the expense of the district, when funds are available therefor and if 
agreeable to the district to which it is proposed to transport the pupils, for 
the whole or a part of the school year, as it may deem advisable, and subject to 
its rules. In any school district, the board shall arrange for the attendance of 
all pupils living two miles or more from the school, except pupils whose 
transportation privileges have been revoked under section 123.805, subdivision 
1, clause (6), or 123.7991, paragraph (b), through suitable provision for 
transportation or through the boarding and rooming of the pupils who may be more 
economically and conveniently provided for by that means. Arrangement for attendance may include a requirement that 
the student's parent or guardian request transportation services from the school 
district. The board shall provide transportation to and from the home of a 
child with a disability not yet enrolled in kindergarten when special 
instruction and services under sections 120.17 and 120.1701 are provided in a 
location other than in the child's home. When transportation is provided, 
scheduling of routes, establishment of the location of bus stops, manner and 
method of transportation, control and discipline of school children and any 
other matter relating thereto shall be within the sole discretion, control, and 
management of the school board. The district may provide for the transportation 
of pupils or expend a reasonable amount for room and board of pupils whose 
attendance at school can more economically and conveniently be provided for by 
that means or who attend school in a building rented or leased by a district 
within the confines of an adjacent district. 
 Sec. 5. Minnesota Statutes 1996, section 123.39, is 
amended by adding a subdivision to read: 
 Subd. 1a. [VOLUNTARY SURRENDER 
OF TRANSPORTATION PRIVILEGES.] The parent or guardian of 
a secondary student may voluntarily surrender the secondary student's to and 
from school transportation privileges granted under subdivision 1. A district 
may reduce parking fees or offer other incentives to a student who voluntarily 
waives these transportation privileges. The school district shall inform each 
secondary student who has voluntarily surrendered transportation privileges of 
the location of the nearest school bus stop and establish a policy allowing the 
student to ride the bus on an occasional basis. The district must also establish 
a process to allow a student to regain transportation privileges if the 
student's circumstances change during the school year. 
 Sec. 6. Minnesota Statutes 1996, section 124.14, 
subdivision 7, is amended to read: 
 Subd. 7. [APPROPRIATION TRANSFERS.] If a direct 
appropriation from the general fund to the department of children, families, and 
learning for any education aid or grant authorized in this chapter and chapters 
121, 123, 124A, 124C, 125, 126, and 134, excluding 
appropriations under sections 124.255, 124.26, 124.2601, 124.2605, 124.261, 
124.2615, 124.2711, 124.2712, 124.2713, 124.2714, 124.2715, and 124.2716, 
exceeds the amount required, the commissioner of children, families, and 
learning may transfer the excess to any education aid or grant appropriation 
that is insufficient. However, section 124A.032 applies to a deficiency in the 
direct appropriation for general education aid. Excess appropriations shall be 
allocated proportionately among aids or grants that have insufficient 
appropriations. The commissioner of finance shall make the necessary transfers 
among appropriations according to the determinations of the commissioner of 
children, families, and learning. If the amount of the direct appropriation for 
the aid or grant plus the amount transferred according to this subdivision is 
insufficient, the commissioner shall prorate the available amount among eligible 
districts. The state is not obligated for any additional amounts. 
 Sec. 7. Minnesota Statutes 1996, section 124.14, is 
amended by adding a subdivision to read: 
 Subd. 7a. [APPROPRIATION 
TRANSFERS FOR COMMUNITY EDUCATION PROGRAMS.] If a direct 
appropriation from the general fund to the department of children, families, and 
learning for an education aid or grant authorized under section 124.255, 124.26, 
124.2601, 124.2605, 124.261, 124.2615, 124.2711, 124.2712, 124.2713, 124.2714, 
124.2715, or 124.2716 exceeds the amount required, the commissioner of children, 
families, and learning may transfer the excess to any education aid or grant 
appropriation that is insufficiently funded under these sections. Excess 
 appropriations shall be allocated proportionately among 
aids or grants that have insufficient appropriations. The commissioner of 
finance shall make the necessary transfers among appropriations according to the 
determinations of the commissioner of children, families, and learning. If the 
amount of the direct appropriation for the aid or grant plus the amount 
transferred according to this subdivision is insufficient, the commissioner 
shall prorate the available amount among eligible districts. The state is not 
obligated for any additional amounts. Sec. 8. Minnesota Statutes 1997 Supplement, section 
124.17, subdivision 1d, is amended to read: 
 Subd. 1d. [COMPENSATION REVENUE PUPIL UNITS.] 
Compensation revenue pupil units for fiscal year 1998 and thereafter must be 
computed according to this subdivision. 
 (a) The compensation revenue concentration percentage for 
each building in a district equals the product of 100 times the ratio of: 
 (1) the sum of the number of pupils enrolled in the 
building eligible to receive free lunch plus one-half of the pupils eligible to 
receive reduced priced lunch on October 1 of the previous fiscal year; to 
 (2) the number of pupils enrolled in the building on 
October 1 of the previous fiscal year. 
 (b) The compensation revenue pupil weighting factor for a 
building equals the lesser of one or the quotient obtained by dividing the 
building's compensation revenue concentration percentage by 80.0. 
 (c) The compensation revenue pupil units for a building 
equals the product of: 
 (1) the sum of the number of pupils enrolled in the 
building eligible to receive free lunch and one-half of the pupils eligible to 
receive reduced priced lunch on October 1 of the previous fiscal year times the equity adjustment factor; times 
 (2) the compensation revenue pupil weighting factor for 
the building times the equity adjustment factor; 
times 
 (3) .60. 
 (d) For fiscal years 1999 and 
later, a district qualifies for the equity adjustment factor if the district 
served more than 5,000 pupils eligible to receive free or reduced price lunch 
during the previous fiscal year and if the district's percentage of pupils 
eligible to receive free or reduced price lunch during the previous fiscal year 
is less than the statewide average percentage for that year. The equity 
adjustment factor equals the ratio of the statewide percentage of pupils 
eligible to receive free or reduced price lunch during the previous fiscal year 
to the district's percentage of pupils eligible to receive free or reduced price 
lunch. 
 (e) Notwithstanding paragraphs (a) 
to (c), for charter schools and contracted alternative programs in the first 
year of operation, compensation revenue pupil units shall be computed using data 
for the current fiscal year. If the charter school or contracted alternative 
program begins operation after October 1, compensatory revenue pupil units shall 
be computed based on pupils enrolled on an alternate date determined by the 
commissioner, and the compensation revenue pupil units shall be prorated based 
on the ratio of the number of days of student instruction to 170 days. 
 (f) The percentages in this 
subdivision must be based on the count of individual pupils and not on a 
building average or minimum. 
 Sec. 9. Minnesota Statutes 1996, section 124.17, is 
amended by adding a subdivision to read: 
 Subd. 5a. [BASIC SKILLS SUMMER 
SCHOOL PUPIL UNITS.] When a pupil who has not passed an 
assessment of basic graduation standards in reading, writing, or mathematics is 
enrolled in a mastery of basic skills summer school program that is not a part 
of the regular school term and the student has a total enrollment time of more 
than 1,020 hours in a school year, the pupil may be counted as more than one 
pupil in average daily membership for purposes of this subdivision only. The 
amount in excess of one pupil must be determined by the ratio of the number of 
hours of instruction provided to that pupil in excess of 1,020 hours. For each 
pupil, only the amount of summer school enrollment time 
 attributable to basic skills instruction may be used to 
calculate the additional hours in the school year. Basic skills instruction is 
defined as in Minnesota's rules on graduation standards and includes reading, 
writing, and mathematics. Hours that occur after the close of the instructional 
year in June are attributable to the following fiscal year. A pupil for whom 
payment is made under this subdivision may be counted by a district only for the 
computation of basic revenue, according to section 124A.22, subdivision 2. Sec. 10. Minnesota Statutes 1997 Supplement, section 
124.17, subdivision 6, is amended to read: 
 Subd. 6. [FREE AND REDUCED PRICED LUNCHES.] The 
commissioner shall determine the number of children eligible to receive either a 
free or reduced priced lunch on October 1 each year. Children enrolled in a building on October 1 and determined 
to be eligible to receive free or reduced price lunch by January 15 of the 
following year shall be counted as eligible on October 1 for purposes of 
subdivision 1d. The commissioner may use federal definitions for these 
purposes and may adjust these definitions as appropriate. The commissioner may 
adopt reporting guidelines to assure accuracy of data counts and eligibility. 
Districts shall use any guidelines adopted by the commissioner. 
 Sec. 11. Minnesota Statutes 1997 Supplement, section 
124.17, subdivision 7, is amended to read: 
 Subd. 7. [LEP PUPIL UNITS.] (a) Limited English 
proficiency pupil units for fiscal year 1998 and thereafter shall be determined 
according to this subdivision. 
 (b) The limited English proficiency concentration 
percentage for a district equals the product of 100 times the ratio of: 
 (1) the number of pupils of limited English proficiency 
enrolled in the district during the current fiscal year; to 
 (2) the number of pupils in average daily membership 
enrolled in the district. 
 (c) The limited English proficiency pupil units for each 
pupil enrolled in a program for pupils of limited English proficiency in 
accordance with sections 126.261 to 126.269 equals the lesser of one or the 
quotient obtained by dividing the limited English proficiency concentration 
percentage for the pupil's district of enrollment by 11.5. 
 (d) Limited English proficiency pupil units shall be 
counted by the district of enrollment. 
 (e) Notwithstanding paragraph (d), 
for the purposes of this subdivision, pupils enrolled in a cooperative or 
intermediate school district shall be counted by the district of residence. 
 Sec. 12. Minnesota Statutes 1996, section 124.248, 
subdivision 1, is amended to read: 
 Subdivision 1. [GENERAL EDUCATION REVENUE.] General 
education revenue shall be paid to a charter school as though it were a school 
district. The general education revenue for each pupil unit is the state average 
general education revenue per pupil unit minus  Sec. 13. Minnesota Statutes 1996, section 124.248, 
subdivision 1a, is amended to read: 
 Subd. 1a. [TRANSPORTATION REVENUE.] Transportation 
revenue shall be paid to a charter school that provides transportation services 
according to section 120.064, subdivision 15, according to this subdivision. 
Transportation aid shall equal transportation revenue. 
 Sec. 14. Minnesota Statutes 1997 Supplement, section 
124.248, subdivision 2a, is amended to read: 
 Subd. 2a. [BUILDING LEASE AID.] When a charter school 
finds it economically advantageous to rent or lease a building or land for any 
instructional purposes and it determines that the total operating capital 
revenue under section 124A.22, subdivision 10, is insufficient for this purpose, 
it may apply to the commissioner for building lease aid for this purpose. 
Criteria for aid approval and revenue uses shall be as defined for the building 
lease levy in section 124.91, subdivision 1, paragraphs 
(a) and (b). The amount of building lease aid per pupil unit served for a charter school for any year shall not 
exceed the lesser of (a) 80 percent of the approved cost or (b) the product of 
the  Sec. 15. Minnesota Statutes 1997 Supplement, section 
124.248, subdivision 6, is amended to read: 
 Subd. 6. [START-UP COSTS.] During the first two years of 
a charter school's operation, the charter school is eligible for aid to pay for 
start-up costs and additional operating costs. Start-up cost aid equals the 
greater of: 
 (1) $50,000 per charter school; or 
 (2) $500 times the charter school's pupil units served for that year. 
 Sec. 16. Minnesota Statutes 1996, section 124.3201, 
subdivision 5, is amended to read: 
 Subd. 5. [SCHOOL DISTRICT SPECIAL EDUCATION REVENUE.] (a) 
A school district's special education revenue for fiscal year 1996 and later 
equals the state total special education revenue, minus the amount determined 
under paragraph (b), times the ratio of the district's adjusted special 
education base revenue to the state total adjusted special education base 
revenue. If the state board of education modifies its rules for special 
education in a manner that increases a school district's special education 
obligations or service requirements, the commissioner of children, families, and 
learning shall annually increase each district's special education revenue by 
the amount necessary to compensate for the increased service requirements. The 
additional revenue equals the cost in the current year attributable to rule 
changes not reflected in the computation of special education base revenue, 
multiplied by the appropriate percentages from subdivision 2. 
 (b) Notwithstanding paragraph (a), if the special 
education base revenue for a district equals zero, the special education revenue 
equals the amount computed according to subdivision 2 using current year data. 
 (c) Notwithstanding paragraphs (a) 
and (b), if the special education base revenue for a district is greater than 
zero, and the base year amount for the district under subdivision 2, paragraph 
(a), clause (7), equals zero, the special education revenue equals the sum of 
the amount computed according to paragraph (a), plus the amount computed 
according to subdivision 2, paragraph (a), clause (7), using current year 
data. 
 Sec. 17. Minnesota Statutes 1996, section 124A.03, 
subdivision 3c, is amended to read: 
 Subd. 3c. [REFERENDUM ALLOWANCE REDUCTION.] For fiscal 
year 1998 and later, a district's referendum allowance for referendum authority 
under subdivision 1c is reduced as provided in this subdivision. 
 (a) For referendum revenue authority approved before June 
1, 1996, and effective for fiscal year 1997, the reduction equals the amount of 
the reduction computed for fiscal year 1997 under subdivision 3b. 
 (b) For referendum revenue authority approved before June 
1, 1996, and effective beginning in fiscal year 1998, the reduction equals the 
amount of the reduction computed for fiscal year 1998 under subdivision 3b. 
 (c) For referendum revenue authority approved after May 
31, 1996, there is no reduction. 
 (d) For districts with more than one referendum 
authority, the reduction shall be computed separately for each authority. The 
reduction shall be applied first to authorities levied against tax capacity, and 
then to authorities levied against referendum market value. For districts with 
more than one authority levied against net tax capacity or against referendum 
market value, the referendum allowance reduction shall be applied first to the 
authority with the earliest expiration date. 
 (e) When referendum authority 
approved before June 1, 1996, expires, the referendum allowance reduction for a 
district shall be decreased by the amount of the decrease in the district's 
total referendum allowance under subdivision 1c. For districts with more than 
one referendum authority remaining after the expiration, the amount of any 
remaining allowance reduction shall be reallocated among the remaining 
referendum authority approved before June 1, 1996, according to paragraph 
(d). 
 (f) For a newly reorganized 
district created after July 1, 1996, the referendum revenue reduction equals the 
lesser of the amount calculated for the combined district, or the sum of the 
amounts by which each of the reorganizing district's supplemental revenue 
reduction exceeds its respective supplemental revenue allowances calculated for 
the year preceding the year of reorganization. 
 Sec. 18. Minnesota Statutes 1997 Supplement, section 
124A.036, subdivision 5, is amended to read: 
 Subd. 5. [ALTERNATIVE ATTENDANCE PROGRAMS.] The general 
education aid for districts must be adjusted for each pupil attending a 
nonresident district under sections 120.062, 120.075, 120.0751, 120.0752, 
124C.45 to 124C.48, and 126.22. The adjustments must be made according to this 
subdivision. 
 (a) General education aid paid to a resident district 
must be reduced by an amount equal to the general education revenue exclusive of 
 (b) General education aid paid to a district serving a 
pupil in programs listed in this subdivision shall be increased by an amount 
equal to the general education revenue exclusive of  (c) If the amount of the reduction to be made from the 
general education aid of the resident district is greater than the amount of 
general education aid otherwise due the district, the excess reduction must be 
made from other state aids due the district. 
 (d) The district of residence shall pay tuition to a 
district or an area learning center, operated according to paragraph (e), 
providing special instruction and services to a pupil with a disability, as 
defined in section 120.03, or a pupil, as defined in section 120.181, who is 
enrolled in a program listed in this subdivision. The tuition shall be equal to 
(1) the actual cost of providing special instruction and services to the pupil, 
including a proportionate amount for debt service and for capital expenditure 
facilities and equipment, and debt service but not including any amount for 
transportation, minus (2) the amount of general education aid and special 
education aid, attributable to that pupil, that is received by the district 
providing special instruction and services. 
 (e) An area learning center operated by a service 
cooperative, intermediate district, education district, or a joint powers 
cooperative may elect through the action of the constituent boards to charge 
tuition for pupils rather than to calculate general education aid adjustments 
under paragraph (a), (b), or (c). The tuition must be equal to the greater of 
the average general education revenue per pupil unit attributable to the pupil, 
or the actual cost of providing the instruction, excluding transportation costs, 
if the pupil meets the requirements of section 120.03 or 120.181. 
 Sec. 19. Minnesota Statutes 1996, section 124A.036, 
subdivision 6, is amended to read: 
 Subd. 6. [CHARTER SCHOOLS.] (a) The general education aid 
for districts must be adjusted for each pupil attending a charter school under 
section 120.064. The adjustments must be made according to this subdivision. 
 (b) General education aid paid to a resident district 
must be reduced by an amount equal to the general education revenue exclusive of 
 (c) General education aid paid to a district in which a 
charter school not providing transportation according to section 120.064, 
subdivision 15, is located shall be increased by an amount equal to the product 
of: (1) the sum of  (d) If the amount of the reduction to be made from the 
general education aid of the resident district is greater than the amount of 
general education aid otherwise due the district, the excess reduction must be 
made from other state aids due the district. 
 Sec. 20. Minnesota Statutes 1997 Supplement, section 
124A.22, subdivision 1, is amended to read: 
 Subdivision 1. [GENERAL EDUCATION REVENUE.]  Sec. 21. Minnesota Statutes 1996, section 124A.22, is 
amended by adding a subdivision to read: 
 Subd. 14. [GRADUATION 
STANDARDS IMPLEMENTATION REVENUE.] (a) A school 
district's graduation standards implementation revenue is equal to $63 times its 
actual pupil units for fiscal year 1999 and $36 per pupil unit for fiscal year 
2000 and later. Graduation standards implementation revenue is reserved and must 
be used according to paragraphs (b) and (c). 
 (b) For fiscal year 1999, revenue 
must be reserved for programs according to clauses (1) to (3). 
 (1) $36 per actual pupil unit must 
be allocated to school sites in proportion to the number of students enrolled at 
each school site weighted according to section 124.17, subdivision 1, and is 
reserved for programs designed to enhance the implementation of the graduation 
rule through intensive staff development and decentralized decision making. 
 (2) At least $5 per actual pupil 
unit is reserved for gifted and talented programs that are integrated with the 
graduation rule. This aid must supplement, not supplant, money spent on gifted 
and talented programs authorized under Laws 1997, First Special Session chapter 
4, article 5, section 24. 
 (3) Any remaining aid under this 
paragraph must be used for either class size reduction or for technology 
purchases related to the graduation rule consistent with subdivision 11, clauses 
(15), (18), (19), (23), and (24). 
 (c) For fiscal year 2000 and 
later, revenue must be allocated to school sites and reserved for programs 
designed to enhance the implementation of the graduation rule through either 
staff development programs or class size reduction programs based at the school 
site. 
 (d) To the extent possible, school 
districts shall make opportunities for graduation standards implementation 
available to teachers employed by intermediate school districts. If the 
commissioner determines that the supplemental appropriation made for this 
subdivision under section 37, subdivision 2, is in excess of the amount needed 
for this subdivision, the commissioner shall make equal payments of one-third of 
the excess to each intermediate school district for the purpose of paragraph 
(a). 
 Sec. 22. Minnesota Statutes 1997 Supplement, section 
124A.23, subdivision 1, is amended to read: 
 Subdivision 1. [GENERAL EDUCATION TAX RATE.] The 
commissioner shall establish the general education tax rate by July 1 of each 
year for levies payable in the following year. The general education tax 
capacity rate shall be a rate, rounded up to the nearest hundredth of a percent, 
that, when applied to the adjusted net tax capacity for all districts, raises 
the amount specified in this subdivision. The general education tax rate shall 
be the rate that raises  Sec. 23. Minnesota Statutes 1997 Supplement, section 
124A.28, subdivision 1, is amended to read: 
 Subdivision 1. [USE OF THE REVENUE.] The compensatory 
education revenue under section 124A.22, subdivision 3, and the portion of the transition revenue adjustment under 
section 124A.22, subdivision 13c, attributable to the compensatory transition 
allowance under section 124A.22, subdivision 13b, paragraph (b), must be 
used to meet the educational needs of pupils whose progress toward meeting state 
or local content or performance standards is below the level that is appropriate 
for learners of their age. Any of the following may be provided to meet these 
learners' needs: 
 (1) direct instructional services under the assurance of 
mastery program according to section 124.3111; 
 (2) remedial instruction in reading, language arts, 
mathematics, other content areas, or study skills to improve the achievement 
level of these learners; 
 (3) additional teachers and teacher aides to provide more 
individualized instruction to these learners through individual tutoring, lower 
instructor-to-learner ratios, or team teaching; 
 (4) a longer school day or week during the regular school 
year or through a summer program that may be offered directly by the site or 
under a performance-based contract with a community-based organization; 
 (5) comprehensive and ongoing staff development 
consistent with district and site plans according to section 126.70, for 
teachers, teacher aides, principals, and other personnel to improve their 
ability to identify the needs of these learners and provide appropriate 
remediation, intervention, accommodations, or modifications; 
 (6) instructional materials and technology appropriate 
for meeting the individual needs of these learners; 
 (7) programs to reduce truancy, encourage completion of 
high school, enhance self-concept, provide health services, provide nutrition 
services, provide a safe and secure learning environment, provide coordination 
for pupils receiving services from other governmental agencies, provide 
psychological services to determine the level of social, emotional, cognitive, 
and intellectual development, and provide counseling services, guidance 
services, and social work services; 
 (8) bilingual programs, bicultural programs, and programs 
for learners of limited English proficiency; 
 (9) all day kindergarten; 
 (10) extended school day and extended school year 
programs; 
 (11) substantial parent involvement in developing and 
implementing remedial education or intervention plans for a learner, including 
learning contracts between the school, the learner, and the parent that 
establish achievement goals and responsibilities of the learner and the 
learner's parent or guardian; and 
 (12) other methods to increase achievement, as needed. 
 Sec. 24. Minnesota Statutes 1997 Supplement, section 
124A.28, subdivision 1a, is amended to read: 
 Subd. 1a. [BUILDING ALLOCATION.] (a) For fiscal years 1999 and later, a district must 
allocate  (b) A district may allocate 
compensatory revenue not otherwise allocated under paragraph (a) to school sites 
according to a plan adopted by the school board. 
 (c) For the purposes of this 
section and section 124.17, subdivision 1d, "building" means education site as 
defined in section 123.951, subdivision 1. 
 (d) If the pupil is served at 
a site other than one owned and operated by the district, the revenue shall be 
paid to the district and used for services for pupils who generate the revenue. 
 Sec. 25. Minnesota Statutes 1996, section 124A.30, is 
amended to read: 
 124A.30 [STATEWIDE AVERAGE REVENUE.] 
 By October 1 of each year the commissioner shall estimate 
the statewide average adjusted general  If the disparity in adjusted 
general  For purposes of this section, 
adjusted general revenue means the sum of basic revenue under section 124A.22, 
subdivision 2; supplemental revenue under section 124A.22, subdivisions 8 and 9; 
transition revenue under section 124.22, subdivision 13c; and referendum revenue 
under section 124A.03. 
 Sec. 26. [124A.32] [IN-SCHOOL SUSPENSION REVENUE.] 
 A school site shall receive $4 per 
pupil per school day for each pupil the school site suspends and places in an 
in-school suspension program or alternative to an out-of-school suspension 
program instead of prohibiting the pupil from attending school. The school site 
shall use the revenue for the increased costs of having a licensed teacher 
instruct a pupil placed in an in-school suspension program or alternative to an 
out-of-school suspension program. 
 Sec. 27. Laws 1992, chapter 499, article 7, section 31, 
is amended to read: 
 Sec. 31. [REPEALER.] 
 Sec. 28. Laws 1997, First Special Session chapter 4, 
article 1, section 58, is amended to read: 
 Sec. 58. [BUS PURCHASE LEVY.] 
 (a) For 1997 taxes payable in 
1998, a school district may levy the amount necessary to eliminate the deficit 
in the reserved fund balance account for bus purchases in its transportation 
fund as of June 30, 1996. 
 (b) For 1998 taxes payable in 
1999, a school district that had a positive balance in the reserved fund balance 
account for bus purchases in its transportation fund as of June 30, 1996, but 
that had already entered into a contract for new buses or ordered new buses that 
had not been received prior to June 30, 1996, may levy an amount equal to the 
difference between the purchase price of the buses and its balance in the 
reserve account for bus purchases. 
 Sec. 29. Laws 1997, First Special Session chapter 4, 
article 1, section 61, subdivision 3, is amended to read: 
 Subd. 3. [EQUALIZING FACTORS.] The commissioner shall 
adjust each equalizing factor established using adjusted 
net tax capacity per actual pupil unit under Minnesota Statutes, chapters 
124 and 124A, by dividing the equalizing factor by the ratio of the statewide 
tax capacity as calculated using the class rates in effect for assessment year 
1996 to the statewide tax capacity using the class rates for that assessment 
year. 
 Sec. 30. Laws 1997, First Special Session chapter 4, 
article 2, section 51, subdivision 29, is amended to read: 
 Subd. 29. [FIRST GRADE PREPAREDNESS.] (a) For grants for 
the first grade preparedness program under Minnesota Statutes, section 124.2613, 
and for school sites that have provided a full-day kindergarten option for 
kindergarten students enrolled in fiscal years 1996 and 1997: 
 $5,000,000 . . . . . 1998 
 (b) To be a qualified site, licensed teachers must have 
taught the optional full-day kindergarten classes. A district that charged a fee 
for students participating in an optional full-day program is eligible to 
receive the grant to provide full-day kindergarten for all students as required 
by Minnesota Statutes, section 124.2613, subdivision 4. Districts with eligible 
sites must apply to the commissioner of children, families, and learning for a 
grant. 
 (c) This appropriation must first be used to fund 
programs operating during the 1996-1997 school year under paragraph (b) and 
Minnesota Statutes, section 124.2613. Any remaining funds may be used to expand 
the number of sites providing first grade preparedness programs. 
 Sec. 31. Laws 1997, First Special Session chapter 4, 
article 5, section 28, subdivision 12, is amended to read: 
 Subd. 12. [GRADUATION RULE IMPLEMENTATION AT THE SITE 
AID.] For graduation rule implementation: 
 $10,000,000 . . . . . 1998 
 (a) This appropriation shall be paid to districts 
according to paragraph (b). The purpose of the aid is to accelerate the 
implementation of the graduation rule throughout all education sites in the 
district through intensive staff development and decentralized decision making. 
The board shall work with the teaching staff in the district to determine the 
most effective staff development processes to assure an acceleration of the 
implementation. This appropriation is one-time only. 
 (b) A district shall receive aid equal to $10 times the 
number of fund balance pupil units in the district 
for fiscal year 1998 excluding pupil units attributable 
to shared time pupils. At least 30 percent must be used for the purposes of 
paragraph (a). 
 Sec. 32. Laws 1997, First Special Session chapter 4, 
article 9, section 11, is amended to read: 
 Sec. 11. [ADDITIONAL TECHNOLOGY REVENUE.] 
 (a) For fiscal year 1998 only, 
the allowance in Minnesota Statutes, section 124A.22, subdivision 10, paragraph 
(a), is increased by: 
 (1) $24 per pupil unit; or 
 (2) the lesser of $25,000 or $80 per pupil unit. 
 Revenue received under this section must be used 
according to Minnesota Statutes, section 124A.22, subdivision 11, clauses (15), 
(18), (19), (23), and (24). 
 (b) For the purposes of paragraph 
(a), "pupil unit" means fund balance pupil unit as defined in Minnesota 
Statutes, section 124A.26, subdivision 1, excluding pupil units attributable to 
shared time pupils. 
 Sec. 33. [COMPENSATION PUPIL UNITS; FISCAL YEAR 1998.] 
 Notwithstanding Minnesota 
Statutes, section 124.17, subdivision 1d, paragraphs (a) to (c), for fiscal year 
1998 only, compensation revenue pupil units for buildings with no free or 
reduced price lunch counts for fiscal year 1997 because the site did not 
participate in the national school lunch program, or for a contracted 
alternative program for which no count was reported to the department of 
children, families, and learning, shall be computed using data for the current 
fiscal year. 
 Sec. 34. [SUPPLEMENTAL REVENUE.] 
 Supplemental revenue for fiscal 
years 1998 and later under Minnesota Statutes, section 124A.22, subdivision 8, 
is increased by the following amounts: 
 (1) for independent school 
district No. 593, Crookston, $117,000; 
 (2) for independent school 
district No. 361, International Falls, $107,000; 
 (3) for independent school 
district No. 706, Virginia, $43,000; and 
 (4) for independent school 
district No. 2154, Eveleth-Gilbert, $8,000. 
 Supplemental revenue increased 
under this section is not subject to reduction under Minnesota Statutes, section 
124A.22, subdivision 9. 
 Sec. 35. [MODEL TRANSPORTATION AND SCHOOL START TIME 
POLICY.] 
 Subdivision 1. [TRANSPORTATION 
EFFICIENCY.] Independent school district No. 270, 
Hopkins, shall establish a task force consisting of community members, school 
board members, parents, teachers, and administrators to examine its existing 
pupil transportation system. The task force shall examine all manner of school 
bus transportation efficiencies, including: 
 (1) state transportation 
mandates; 
 (2) school bus route design; 
 (3) school bus stop locations; 
 (4) school bus student pick-up 
times; and 
 (5) changes to peak-hour highway 
policies for school buses, with particular attention paid to the effects of 
metered ramps on school bus efficiency. 
 The task force shall also evaluate 
alternative transportation methods such as metropolitan transit commission bus 
service, student carpools, and other manners of student transportation to and 
from school. 
 Subd. 2. [SCHOOL START TIME.] 
The task force shall evaluate the effect of 
transportation decisions on school start times and make recommendations about 
school start times for elementary and secondary students. 
 Subd. 3. [REPORT.] Independent school district No. 270, Hopkins, shall 
summarize the activities of the task force and prepare a report to be presented 
by March 1, 1999, to the 1999 legislature. 
 Sec. 36. [INDEPENDENT SCHOOL DISTRICT NO. 2862, JACKSON 
COUNTY CENTRAL; REFERENDUM AUTHORITY.] 
 Subdivision 1. [REFERENDUM 
REVENUE ADJUSTMENT.] Notwithstanding Minnesota Statutes, 
section 124A.03, referendum equalization aid for fiscal year 1998 for 
independent school district No. 2862, Jackson County Central, is $72,000, and 
the district's net tax capacity referendum levy is $61,000. 
 Subd. 2. [AID ADJUSTMENT.] The department of children, families, and learning shall 
adjust the aid payments for fiscal year 1998 to independent school district No. 
2862, Jackson County Central, according to subdivision 1. 
 Subd. 3. [LEVY ADJUSTMENT.] For taxes payable in 1999, the department of children, 
families, and learning shall make a levy adjustment for the independent school 
district No. 2862, Jackson County Central, referendum levy authority for fiscal 
year 1998, according to subdivision 1. 
 Sec. 37. [APPROPRIATION.] 
 Subdivision 1. [DEPARTMENT OF 
CHILDREN, FAMILIES, AND LEARNING.] The sums indicated in 
this section are appropriated from the general fund to the department of 
children, families, and learning for the fiscal years designated. 
 Subd. 2. [GENERAL EDUCATION 
AID.] For general education aid: 
 $185,000 . . . . . 1998 
 $59,787,000 . . . . . 1999 
 This aid is in addition to any 
other aid appropriated for this purpose. 
 Subd. 3. [HOPKINS.] For a grant to independent school district No. 270, Hopkins, 
for the purposes of section 35: 
 $50,000 . . . . . 1999 
 Subd. 4. [IN-SCHOOL SUSPENSION 
COSTS.] For in-school suspension costs that school sites 
incur under Minnesota Statutes, section 124A.32: 
 $300,000 . . . . . 1999 
 Subd. 5. [TECHNOLOGY 
INTEGRATION PROJECT.] For a grant to independent school 
district No. 62, Ortonville, to implement a technology integration program: 
 $200,000 . . . . . 1999 
 The purpose of the technology 
integration pilot project is to demonstrate successful and effective uses of 
technology for students, teachers, guidance counselors, administrators, and 
parents to implement Minnesota's graduation standards and track student 
performance in meeting the standards. 
 Sec. 38. [REPEALER.] 
 (a) Minnesota Statutes 1997 
Supplement, section 124.912, subdivisions 2 and 3, are repealed effective for 
taxes payable in 1998. 
 (b) Minnesota Statutes 1996, 
sections 124A.697; 124A.698; 124A.70; 124A.71; 124A.711, subdivision 1; 124A.72; 
and 124A.73; and Minnesota Statutes 1997 Supplement, section 124A.711, 
subdivision 2, are repealed. 
 Sec. 39. [EFFECTIVE DATE.] 
 (a) Sections 1, 2, 4, 5, 25, 28, 
30, and 35 are effective July 1, 1998. 
 (b) Section 3 is effective July 1, 
1999. 
 (c) Sections 8, 22, 27, and 36 are 
effective the day following final enactment. 
 (d) Sections 9, 12, 13, 16, 18, 
19, 20, 21, 23, 24, and 26 are effective for revenue for fiscal year 1999. 
 (e) Sections 6, 7, 11, 14, 15, 16, 
17, 29, 31, 32, 33, and 34 are effective for revenue for fiscal year 1998. 
 (f) Section 10 is effective 
retroactively to July 1, 1997, for revenue for fiscal year 1999. 
 
 
 Section 1. Minnesota Statutes 1996, section 120.03, 
subdivision 1, is amended to read: 
 Subdivision 1. Every child who has a hearing impairment, 
visual disability, speech or language impairment, physical handicap, other 
health impairment, mental handicap, emotional/behavioral disorder, specific 
learning disability, autism, traumatic brain injury, 
or deaf/blind disability and needs special instruction and services, as 
determined by the standards of the state board, is a child with a disability. In 
addition, every child  Sec. 2. [120.031] [STATEWIDE DATA MANAGEMENT SYSTEM TO 
MAXIMIZE MEDICAL ASSISTANCE REIMBURSEMENT.] 
 Subdivision 1. [DEFINITION.] 
For purposes of this section, cooperative unit has the 
meaning given in section 123.35, subdivision 19b, paragraph (d). 
 Subd. 2. [PROVIDING ASSISTANCE 
AND TRAINING.] The commissioner, in cooperation with the 
commissioner of human services, shall develop a statewide data management system 
using the educational data reporting system or other existing data management 
system for school districts and cooperative units to use to maximize medical 
assistance reimbursement for health and health-related services provided under 
individual education plans and individual family service plans. The statewide 
data management system must enable school district and cooperative unit staff 
to: 
 (1) establish medical assistance 
billing systems or improve existing systems; 
 (2) understand the appropriate 
medical assistance billing codes for services provided under individual 
education plans and individual family service plans; 
 (3) comply with the Individuals 
with Disabilities Education Act, Public Law Number 105-17; 
 (4) contract with billing agents; 
and 
 (5) carry out other activities 
necessary to maximize medical assistance reimbursement. 
 Sec. 3. Minnesota Statutes 1996, section 120.06, 
subdivision 2a, is amended to read: 
 Subd. 2a. [EDUCATION AND 
RESIDENCE OF HOMELESS.] (a) Notwithstanding 
subdivision 1, a school district must not deny free admission to a homeless 
person of school age solely because the school district cannot determine that 
the person is a resident of the school district. 
 (b) The school district of 
residence for a homeless person of school age shall be the school district in 
which the homeless shelter or other program, center, or facility assisting the 
homeless person is located. The educational services a school district provides 
to a homeless person must allow the person to work toward meeting the graduation 
standards under section 121.11, subdivision 7c. 
 Sec. 4. Minnesota Statutes 1996, section 120.064, 
subdivision 5, is amended to read: 
 Subd. 5. [CONTRACT.] The sponsor's authorization for a 
charter school shall be in the form of a written contract signed by the sponsor 
and the board of directors of the charter school. The contract for a charter 
school shall be in writing and contain at least the following: 
 (1) a description of a program that carries out one or 
more of the purposes in subdivision 1; 
 (2) specific outcomes pupils are to achieve under 
subdivision 10; 
 (3) admission policies and procedures; 
 (4) management and administration of the school; 
 (5) requirements and procedures for program and financial 
audits; 
 (6) how the school will comply with subdivisions 8, 13, 
15, and 21; 
 (7) assumption of liability by the charter school; 
 (8) types and amounts of insurance coverage to be 
obtained by the charter school;  (9) the term of the contract, which may be up to three 
years; and 
 (10) if the board of directors or 
the operators of the charter school provide special instruction and services for 
children with a disability under section 120.17, a description of the financial 
parameters within which the charter school will operate to provide the special 
instruction and services to children with a disability. 
 Sec. 5. Minnesota Statutes 1996, section 120.101, 
subdivision 3, is amended to read: 
 Subd. 3. [PARENT DEFINED; 
RESIDENCY DETERMINED.] (a) In sections 120.101 to 
120.103, "parent" means a parent, guardian, or other person having legal custody 
of a child. 
 (b) In section 120.17, "parent" 
means a parent, guardian, or other person having legal custody of a child under 
age 18. For an unmarried pupil age 18 or over, "parent" means the pupil unless a 
guardian or conservator has been appointed, in which case it means the guardian 
or conservator. 
 (c) For purposes of section 
120.17, the school district of residence for an unmarried pupil age 18 or over 
who is a parent under paragraph (b) and who is placed in a center for care and 
treatment, shall be the school district in which the pupil's biological or 
adoptive parent or designated guardian resides. 
 (d) For a married pupil age 18 or 
over, the school district of residence is the school district in which the 
married pupil resides. 
 Sec. 6. Minnesota Statutes 1996, section 120.17, 
subdivision 1, is amended to read: 
 Subdivision 1. [SPECIAL INSTRUCTION FOR CHILDREN WITH A 
DISABILITY.] (a) As defined in paragraph (b), to the 
extent required in federal law as of July 1, 1999, every district shall 
provide special instruction and services, either within the district or in 
another district, for children with a disability who are residents of the 
district and who are disabled as set forth in section 120.03. 
 (b) Notwithstanding any age 
limits in laws to the contrary, special instruction and services must be 
provided from birth until September 1 after the child with a disability becomes 
22 years old but shall not extend beyond secondary school or its equivalent, 
except as provided in section 126.22, subdivision 2. Local health, education, 
and social service agencies shall refer children under age five who are known to 
need or suspected of needing special instruction and services to the 
 school district. Districts with less than the minimum 
number of eligible children with a disability as determined by the state board 
shall cooperate with other districts to maintain a full range of programs for 
education and services for children with a disability. This subdivision does not 
alter the compulsory attendance requirements of section 120.101. 
 Sec. 7. Minnesota Statutes 1996, section 120.17, 
subdivision 2, is amended to read: 
 Subd. 2. [METHOD OF SPECIAL INSTRUCTION.] (a) As defined in this subdivision, to the extent required by 
federal law as of July 1, 1999, special instruction and services for 
children with a disability must be based on the assessment and individual 
education plan. The instruction and services may be provided by one or more of 
the following methods: 
 (1) in connection with attending regular elementary and 
secondary school classes; 
 (2) establishment of special classes; 
 (3) at the home or bedside of the child; 
 (4) in other districts; 
 (5) instruction and services by special education 
cooperative centers established under this section, or in another member 
district of the cooperative center to which the resident district of the child 
with a disability belongs; 
 (6) in a state residential school or a school department 
of a state institution approved by the commissioner; 
 (7) in other states; 
 (8) by contracting with public, private or voluntary 
agencies; 
 (9) for children under age five and their families, 
programs and services established through collaborative efforts with other 
agencies; 
 (10) for children under age five and their families, 
programs in which children with a disability are served with children without a 
disability; and 
 (11) any other method approved by the commissioner. 
 (b) Preference shall be given to providing special 
instruction and services to children under age three and their families in the 
residence of the child with the parent or primary caregiver, or both, present. 
 (c) The primary responsibility for the education of a 
child with a disability shall remain with the district of the child's residence 
regardless of which method of providing special instruction and services is 
used. If a district other than a child's district of residence provides special 
instruction and services to the child, then the district providing the special 
instruction and services shall notify the child's district of residence before 
the child's individual education plan is developed and shall provide the 
district of residence an opportunity to participate in the plan's development. 
The district of residence must inform the parents of the child about the methods 
of instruction that are available. 
 (d) Paragraphs (e) to (i) may be cited as the "Blind 
Persons' Literacy Rights and Education Act." 
 (e) The following definitions apply to paragraphs (f) to 
(i). 
 "Blind student" means an individual who is eligible for 
special educational services and who: 
 (1) has a visual acuity of 20/200 or less in the better 
eye with correcting lenses or has a limited field of vision such that the widest 
diameter subtends an angular distance of no greater than 20 degrees; or 
 (2) has a medically indicated expectation of visual 
deterioration. 
 "Braille" means the system of reading and writing through 
touch commonly known as standard English Braille. 
 (f) In developing an individualized education plan for 
each blind student the presumption must be that proficiency in Braille reading 
and writing is essential for the student to achieve satisfactory educational 
progress. The assessment required for each student must include a Braille skills 
inventory, including a statement of strengths and deficits. Braille instruction 
and use are not required by this paragraph if, in the course of developing the 
student's individualized education program, team members concur that the 
student's visual impairment does not affect reading and writing performance 
commensurate with ability. This paragraph does not require the exclusive use of 
Braille if other special education services are appropriate to the student's 
educational needs. The provision of other appropriate services does not preclude 
Braille use or instruction. Instruction in Braille reading and writing shall be 
available for each blind student for whom the multidisciplinary team has 
determined that reading and writing is appropriate. 
 (g) Instruction in Braille reading and writing must be 
sufficient to enable each blind student to communicate effectively and 
efficiently with the same level of proficiency expected of the student's peers 
of comparable ability and grade level. 
 (h) The student's individualized education plan must 
specify: 
 (1) the results obtained from the assessment required 
under paragraph(f); 
 (2) how Braille will be implemented through integration 
with other classroom activities; 
 (3) the date on which Braille instruction will begin; 
 (4) the length of the period of instruction and the 
frequency and duration of each instructional session; 
 (5) the level of competency in Braille reading and 
writing to be achieved by the end of the period and the objective assessment 
measures to be used; and 
 (6) if a decision has been made under paragraph(f) that 
Braille instruction or use is not required for the student: 
 (i) a statement that the decision was reached after a 
review of pertinent literature describing the educational benefits of Braille 
instruction and use; and 
 (ii) a specification of the evidence used to determine 
that the student's ability to read and write effectively without Braille is not 
impaired. 
 (i) Instruction in Braille reading and writing is a 
service for the purpose of special education and services under this section. 
 (j) Paragraphs (e) to (i) shall not be construed to 
supersede any rights of a parent or guardian of a child with a disability under 
federal or state law. 
 Sec. 8. Minnesota Statutes 1996, section 120.17, 
subdivision 3, is amended to read: 
 Subd. 3. [RULES OF THE STATE BOARD.] (a) As defined in this paragraph, but not to exceed the extent 
required by federal law as of July 1, 1999, the state board shall promulgate 
rules relative to qualifications of essential personnel, courses of study, 
methods of instruction, pupil eligibility, size of classes, rooms, equipment, 
supervision, parent consultation, and  part 3525.2340, (b) As provided in this paragraph, 
but not to exceed the extent required by federal law as of July 1, 1999, the 
state's regulatory scheme should support schools by assuring that all state 
special education rules adopted by the state board of education result in one or 
more of the following outcomes: 
 (1) increased time available to teachers and, where appropriate, to support staff including school 
nurses for educating students through direct and indirect instruction; 
 (2) consistent and uniform access to effective education 
programs for students with disabilities throughout the state; 
 (3) reduced inequalities (4) clear expectations for service providers and for 
students with disabilities; 
 (5) increased accountability for all individuals and 
agencies that provide instruction and other services to students with 
disabilities; 
 (6) greater focus for the state and local resources 
dedicated to educating students with disabilities; and 
 (7) clearer standards for evaluating the effectiveness of 
education and support services for students with disabilities. 
 Sec. 9. Minnesota Statutes 1996, section 120.17, 
subdivision 3a, is amended to read: 
 Subd. 3a. [SCHOOL DISTRICT OBLIGATIONS.] (a) As defined in this subdivision, to the extent required 
by federal law as of July 1, 1999, every district shall ensure that: 
 (1) all students with disabilities are provided the 
special instruction and services which are appropriate to their needs. Where the 
individual education plan team has determined appropriate goals and objectives 
based on the student's needs, including the extent to which the student can be 
included in the least restrictive environment, and where there are essentially 
equivalent and effective instruction, related services, or assistive technology 
devices available to meet the student's needs, cost to the school district may 
be among the factors considered by the team in choosing how to provide the 
appropriate services, instruction, or devices that are to be made part of the 
student's individual education plan. The student's needs and the special 
education instruction and services to be provided shall be agreed upon through 
the development of an individual education plan. The plan shall address the 
student's need to develop skills to live and work as independently as possible 
within the community. By grade 9 or age 14, the plan shall address the student's 
needs for transition from secondary services to post-secondary education and 
training, employment, community participation, recreation, and leisure and home 
living. The plan must include a statement of the needed transition services, 
including a statement of the interagency responsibilities or linkages or both 
before secondary services are concluded; 
 (2) children with a disability under age five and their 
families are provided special instruction and services appropriate to the 
child's level of functioning and needs; 
 (3) children with a disability and their parents or 
guardians are guaranteed procedural safeguards and the right to participate in 
decisions involving identification, assessment including assistive technology 
assessment, and educational placement of children with a disability; 
 (4) eligibility and needs of 
children with a disability are determined by an initial assessment or 
reassessment, which may be completed using existing data under United States 
Code, title 20, section 33, et seq.; 
 (5) to the maximum extent 
appropriate, children with a disability, including those in public or private 
institutions or other care facilities, are educated with children who are not 
disabled, and that special classes, separate schooling, or other removal of 
children with a disability from the regular educational environment occurs only 
when and to the extent that the nature or severity of the disability is such 
that education in regular classes with the use of supplementary services cannot 
be achieved satisfactorily; 
 (b) For paraprofessionals employed 
to work in programs for students with disabilities, the school board in each 
district shall ensure that: 
 (1) before or immediately upon 
employment, each paraprofessional develops sufficient knowledge and skills in 
emergency procedures, building orientation, roles and responsibilities, 
confidentiality, vulnerability, and reportability, among other things, to begin 
meeting the needs of the students with whom the paraprofessional works; 
 (2) annual training opportunities 
are available to enable the paraprofessional to continue to further develop the 
knowledge and skills that are specific to the students with whom the 
paraprofessional works, including understanding disabilities, following lesson 
plans, and implementing follow-up instructional procedures and activities; 
and 
 (3) a districtwide process 
obligates each paraprofessional to work under the ongoing direction of a 
licensed teacher and, where appropriate and possible, the supervision of a 
school nurse. 
 Sec. 10. Minnesota Statutes 1996, section 120.17, 
subdivision 3b, is amended to read: 
 Subd. 3b. [PROCEDURES FOR DECISIONS.] As defined in this paragraph, but not to exceed the extent 
required by federal law as of July 1, 1999, every district shall utilize  (a) Parents and guardians shall receive prior written 
notice of: 
 (1) any proposed formal educational assessment or 
proposed denial of a formal educational assessment of their child; 
 (2) a proposed placement of their child in, transfer from 
or to, or denial of placement in a special education program; or 
 (3) the proposed provision, addition, denial or removal 
of special education services for their child (b) The district shall not proceed with the initial 
formal assessment of a child, the initial placement of a child in a special 
education program, or the initial provision of special education services for a 
child without the prior written consent of the child's parent or guardian. The 
refusal of a parent or guardian to consent may be overridden by the decision in 
a hearing held pursuant to  (c) Parents and guardians shall have an opportunity to 
meet with appropriate district staff in at least one conciliation conference, 
mediation, or other method of alternative dispute resolution that the parties 
agree to, if they object to any proposal of which they are notified pursuant to 
 a parent or guardian objects to the mediation. Mediation 
under this paragraph shall not affect parties' subsequent rights to a due 
process hearing. All mediation is subject to the confidentiality requirements 
under rule 114.08 of the general rules of practice for the district courts. (d) The commissioner shall establish a mediation process 
to assist parents, school districts, or other parties to resolve disputes 
arising out of the identification, assessment, or educational placement of 
children with a disability. The mediation process must be offered as an informal 
alternative to the due process hearing provided under  (e) Parents, guardians, and the district shall have an 
opportunity to obtain an impartial due process hearing initiated and conducted 
by and in the school district responsible for assuring that an appropriate 
program is provided in accordance with state board rules, if the parent or 
guardian continues to object to: 
 (1) a proposed formal educational assessment or proposed 
denial of a formal educational assessment of their child; 
 (2) the proposed placement of their child in, or transfer 
of their child to a special education program; 
 (3) the proposed denial of placement of their child in a 
special education program or the transfer of their child from a special 
education program; 
 (4) the proposed provision or addition of special 
education services for their child; or 
 (5) the proposed denial or removal of special education 
services for their child. 
 Unless otherwise agreed to by its 
parties, an impartial due process hearing is limited to eight hours, with a 
maximum of four hours available to each party. The party requesting the hearing 
shall plead with specificity as to what issues are in dispute and all issues not 
pleaded with specificity are deemed waived. Parties to a hearing are encouraged 
to present only essential witnesses to prove a claim. A hearing review officer, 
at the officer's discretion, may exclude cumulative evidence. 
 Within five business days after the request for a 
hearing, or as directed by the hearing officer, the objecting party shall 
provide the other party with a brief written statement of particulars of the 
objection, the reasons for the objection, and the specific remedies sought. The 
other party shall provide the objecting party with a written response to the 
statement of objections within five business days of receipt of the statement. 
 The hearing shall take place before an impartial hearing 
officer mutually agreed to by the school board and the parent or guardian. 
Within four business days of the receipt of the request for the hearing, if the 
parties have not agreed on the hearing officer, the school board shall request 
the commissioner to appoint a hearing officer from a list 
maintained for that purpose. A retired judge, retired court referee, or retired 
federal magistrate judge who is otherwise qualified under this section and 
wishes to be a hearing officer must be put on the list. The school board 
shall include with the request the name of the person requesting the hearing, 
the name of the student, the attorneys involved, if any, and the date the 
hearing request was received. The hearing officer shall not be a school board 
member or employee of the school district where the child resides or of the 
child's school district of residence, an employee of any other public agency 
involved in the education or care of the child, or any person with a personal or 
professional interest which would conflict with the person's objectivity at the 
hearing. A person who otherwise qualifies as a hearing officer is not an 
employee of the district solely because the person is paid by the district to 
serve as a hearing officer. Any party to a hearing, 
except an expedited hearing 
 under federal law, may make and serve upon the opposing 
party and the commissioner a notice to remove a hearing officer appointed by the 
commissioner. The notice shall be served and filed within two business days 
after the party receives notice of the appointment of the hearing officer by the 
commissioner, but not later than the commencement of the hearing. No such notice may be filed by a 
party against a hearing officer who has presided at a motion or any other 
proceeding of which the party had notice. A hearing officer who has presided at 
a motion or other proceeding may not be removed except upon an affirmative 
showing of prejudice on the part of the hearing officer. 
 After the party has once 
disqualified a hearing officer as a matter of right, that party may disqualify 
the substitute hearing officer only by making an affirmative showing of 
prejudice or bias to the commissioner, or to the chief administrative law judge 
if the hearing officer is an administrative law judge. 
 Upon the filing of a notice to 
remove or if a party makes an affirmative showing of prejudice against a 
substitute hearing officer, the commissioner shall assign any other hearing 
officer to hear the matter. 
 If the hearing officer requests an independent 
educational assessment of a child, the cost of the assessment shall be at 
district expense. The proceedings shall be recorded and preserved, at the 
expense of the school district, pending ultimate disposition of the action. 
 (f) The decision of the hearing officer pursuant to  The local decision shall: 
 (1) be in writing; 
 (2) state the controlling facts upon which the decision 
is made in sufficient detail to apprise the parties and the hearing review 
officer of the basis and reason for the decision; and 
 (3) be based on the standards set forth in subdivision 3a 
and the rules of the state board. 
 (g) The hearing officer may 
require the resident school district to provide compensatory educational 
services to the child if the hearing officer finds that the school district has 
not offered or made available to the child a free appropriate public education 
in the child's educational program and that the child has suffered a loss of 
educational benefit. Such services shall take the form of direct and indirect 
special education and related services designed to address any loss of 
educational benefit that may have occurred. The hearing officer's finding shall 
be based on a present determination of whether the child has suffered a loss of 
educational benefit. 
 If the decision is appealed, a written transcript of the 
hearing shall be made by the school district and provided by the district to the 
parties involved and the hearing review officer within five calendar days of the 
filing of the appeal. The hearing review officer shall conduct an appellate 
review and issue a final independent decision based on an impartial review of 
the local decision and the entire record within 30 calendar days after the 
filing of the appeal. However, the hearing review officer shall seek additional 
evidence if necessary and may afford the parties an opportunity for written or 
 oral argument; provided any hearing held to seek 
additional evidence shall be an impartial due process hearing but shall be 
deemed not to be a contested case hearing for purposes of chapter 14. The 
hearing review officer may grant specific extensions of time beyond the 30-day 
period at the request of any party for good cause shown on the record. 
 The final decision shall: 
 (1) be in writing; 
 (2) include findings and conclusions; and 
 (3) be based upon the standards set forth in subdivision 
3a and in the rules of the state board. 
 (1) the individual must be knowledgeable and impartial; 
 (2) the individual must not have a personal interest in 
or specific involvement with the student who is a party to the hearing; 
 (3) the individual must not have been employed as an 
administrator by the district that is a party to the hearing; 
 (4) the individual must not have been involved in the 
selection of the administrators of the district that is a party to the hearing; 
 (5) the individual must not have a personal, economic, or 
professional interest in the outcome of the hearing other than the proper 
administration of the federal and state laws, rules, and policies; 
 (6) the individual must not have substantial involvement 
in the development of a state or local policy or procedures that are challenged 
in the appeal; 
 (7) the individual is not a current employee or board 
member of a Minnesota public school district, education district, intermediate 
unit or regional education agency, the department of children, families, and 
learning, the state board of education; and 
 (8) the individual is not a current employee or board 
member of a disability advocacy organization or group. 
 Sec. 11. Minnesota Statutes 1996, section 120.17, 
subdivision 6, is amended to read: 
 Subd. 6. [PLACEMENT IN ANOTHER DISTRICT; RESPONSIBILITY.] 
The responsibility for special instruction and services for a child with a 
disability temporarily placed in another district for care and treatment shall 
be determined in the following manner: 
 (a) The school district of residence of a child shall be 
the district in which the child's parent resides, if living, or the child's 
guardian, or the district designated by the commissioner of children, families, 
and learning if neither parent nor guardian is living within the state. 
 (b) When a child is temporarily placed for care and 
treatment in a day program located in another district and the child continues 
to live within the district of residence during the care and treatment, the 
district of residence is responsible for providing transportation and an 
appropriate educational program for the child. The district may provide the 
educational program at a school within the district of residence, at the child's 
residence, or in the district in which the day treatment center is located by 
paying tuition to that district. 
 (c) When a child is temporarily placed in a residential 
program for care and treatment, the nonresident district in which the child is 
placed is responsible for providing an appropriate educational program for the 
child and necessary transportation while the child is attending the educational 
program; and shall bill the district of the child's residence for the actual 
cost of providing the program, as outlined in subdivision 4, except that the 
board, lodging, and treatment costs incurred in behalf of a child with a 
disability placed outside of the school district of residence by the 
commissioner of human services or the commissioner of corrections or their 
agents, for reasons other than for making provision for the child's special 
educational needs shall not become the responsibility of either the district 
providing the instruction or the district of the child's residence. For the purposes of this section, the state correctional 
facilities operated on a fee-for-service basis are considered to be residential 
programs for care and treatment. 
 (d) The district of residence shall pay tuition and other 
program costs, not including transportation costs, to the district providing the 
instruction and services. The district of residence may claim general education 
aid for the child as provided by law. Transportation costs shall be paid by the 
district responsible for providing the transportation and the state shall pay 
transportation aid to that district. 
 Sec. 12. Minnesota Statutes 1996, section 120.17, 
subdivision 7, is amended to read: 
 Subd. 7. [PLACEMENT IN STATE INSTITUTION; 
RESPONSIBILITY.] Responsibility for special instruction and services for a child 
with a disability placed in a state institution on a temporary basis shall be 
determined in the following manner: 
 (a) The legal residence of such child shall be the school 
district in which the child's parent resides, if living, or the child's 
guardian. 
 (b) When the educational needs of such child can be met 
through the institutional program, the costs for such instruction shall be paid 
by the department to which the institution is assigned with exception of children placed in fee-for-service 
facilities operated by the commissioner of corrections whose cost for such 
instruction shall be paid as outlined in subdivision 6. 
 (c) When it is determined that such child can benefit 
from public school enrollment, provision for such instruction shall be made in 
the following manner: 
 (1) determination of eligibility for special instruction 
and services shall be made by the commissioner of children, families, and 
learning and the commissioner of the department responsible for the institution; 
 (2) the school district where the institution is located 
shall be responsible for providing transportation and an appropriate educational 
program for the child and shall make a tuition charge to the child's district of 
residence for the actual cost of providing the program; 
 (3) the district of the child's residence shall pay the 
tuition and other program costs excluding transportation costs and may claim 
general education aid for the child. Transportation costs shall be paid by the 
district where the institution is located and the state shall pay transportation 
aid to that district. 
 Sec. 13. Minnesota Statutes 1996, section 120.17, 
subdivision 9, is amended to read: 
 Subd. 9. [SPECIAL INSTRUCTION.] No resident of a district 
who is eligible for special instruction and services  Sec. 14. Minnesota Statutes 1996, section 120.17, 
subdivision 15, is amended to read: 
 Subd. 15. [THIRD PARTY PAYMENT.] (a) Nothing in this section relieves an insurer or 
similar third party from an otherwise valid obligation to pay, or changes the 
validity of an obligation to pay, for services rendered to a child with a 
disability, and the child's family. A school district may 
pay or reimburse copayments, coinsurance, deductibles, and other enrollee 
cost-sharing amounts, on behalf of the student or family, in connection with 
health and related services provided under an individual educational plan. 
 (b) Beginning July 1, 1999, 
districts shall seek reimbursement from insurers and similar third parties for 
the cost of services provided by the district whenever the services provided by 
the district are otherwise covered by the child's health coverage. Districts 
shall request, but may not require, the child's family to provide information 
about the child's health coverage when a child with a disability begins to 
receive services from the district of a type that may be reimbursable, and shall 
request, but may not require, updated information after that as needed. 
Districts shall request, but may not require, the child's parent or legal 
representative to sign a consent form, permitting the school district to apply 
for and receive reimbursement directly from the insurer or other similar third 
party, to the extent permitted by the insurer or other third party. 
 (c) Of the reimbursements 
received, districts may: 
 (1) retain an amount sufficient to 
compensate the district for its administrative costs of obtaining 
reimbursements; 
 (2) regularly obtain from 
education- and health-related entities training and other appropriate technical 
assistance designed to improve the district's ability to determine which 
services are reimbursable and to seek timely reimbursement in a cost-effective 
manner; or 
 (3) reallocate reimbursements for 
the benefit of students with special needs in the district. 
 (d) To the extent required by 
federal law, a school district may not require parents of children with 
disabilities, if they would incur a financial cost, to use private or public 
health coverage to pay for the services that must be provided under an 
individual education plan. 
 (e) When obtaining informed 
consent, consistent with sections 13.05, subdivision 4, paragraph (d); and 
256B.77, subdivision 2, paragraph (p), to bill health plans for covered 
services, the school district must notify the legal representative (1) that the 
cost of the person's health insurance premium may increase due to providing the 
covered service in the school setting, (2) that the school district may pay 
certain health plan expenses, health plan expenses include, but are not limited 
to, an enrollee's copayments, coinsurance, deductibles, monthly premium 
increases or other enrollee cost-sharing amounts for health and related services 
required by an individual service plan, or individual family service plan, and 
(3) that the school's billing for each type of covered service may affect 
service limits and prior authorization thresholds. The informed consent may be 
revoked in writing at any time by the person authorizing the billing of the 
health plan. 
 (f) To the extent required by 
federal law, no school district may withhold or delay any service that must be 
provided under an individual education plan because a family has refused to 
provide informed consent to bill a health plan for services or a health plan 
company has refused to pay any, all, or a portion of the cost of services 
billed. 
 (g) A school district may disclose 
information contained in a student's individual education plan, consistent with 
section 13.32, subdivision 3(a), including records of the student's diagnosis 
and treatment, to a health plan company only with the signed and dated consent 
of the student's parent, or other legally authorized individual. The school 
district shall disclose only that information necessary for the health plan 
company to decide matters of payment. A health plan company may use the 
information only for making decisions regarding payment, and any other use of 
the information and dissemination of the information is prohibited. 
 Sec. 15. Minnesota Statutes 1996, section 120.1701, 
subdivision 17, is amended to read: 
 Subd. 17. [MEDIATION PROCEDURE.] The commissioner, or the commissioner's designee, of the state lead 
agency shall use federal funds to provide mediation for the activities in 
paragraphs (a) and (b). 
 (a) A parent may resolve a dispute regarding issues in 
subdivision 16, paragraph (b), clause (5), through mediation. If the parent 
chooses mediation, all public agencies involved in the dispute shall participate 
in the mediation process. The parent and the public agencies must complete the 
mediation process within  (b) Resolution of a dispute 
through mediation, or other form of alternative dispute resolution, is not 
limited to formal disputes arising from the objection of a parent or guardian 
and is not limited to the period following a request for a due process 
hearing. 
 (c) The commissioner shall provide 
training and resources to school districts to facilitate early identification of 
disputes and access to mediation. 
 Sec. 16. Minnesota Statutes 1996, section 120.173, 
subdivision 1, is amended to read: 
 Subdivision 1. [COMMISSIONER APPROVAL.] The commissioner 
of children, families, and learning may approve applications from school 
districts to provide prevention services as an alternative to special education 
and other compensatory programs  services in a regular education classroom, or an area learning center, to eligible pupils. Pupils 
eligible to participate in the program are low-performing pupils who, based on 
documented experience, the professional judgment of a classroom teacher, or a 
team of licensed professionals, would eventually qualify for special education 
instruction or related services under section 120.17 if the intervention 
services authorized by this section were unavailable. Pupils may be provided 
services during extended school days and throughout the entire year and through the assurance of mastery program under section 
124.3111. 
 Sec. 17. Minnesota Statutes 1996, section 120.173, 
subdivision 6, is amended to read: 
 Subd. 6. [PUPIL RIGHTS.] A pupil participating in the 
program must be individually evaluated according to the pupil's actual abilities 
and needs. A pupil who is eligible for services under section 120.17 is entitled 
to procedural protections provided under  Sec. 18. Minnesota Statutes 1997 Supplement, section 
120.181, is amended to read: 
 120.181 [PLACEMENT OF CHILDREN WITHOUT DISABILITIES; 
EDUCATION AND TRANSPORTATION.] 
 The responsibility for providing instruction and 
transportation for a pupil without a disability who has a short-term or 
temporary physical or emotional illness or disability, as determined by the 
standards of the state board, and who is temporarily placed for care and 
treatment for that illness or disability, shall be determined as provided in 
this section. 
 (a) The school district of residence of the pupil shall 
be the district in which the pupil's parent or guardian resides, or when neither 
the pupil's parent nor guardian resides within the state and tuition has been 
denied, the district designated by the commissioner of children, families, and 
learning. 
 (b) Prior to the placement of a pupil for care and 
treatment, the district of residence shall be notified and provided an 
opportunity to participate in the placement decision. When an immediate 
emergency placement is necessary and time does not permit resident district 
participation in the placement decision, the district in which the pupil is 
temporarily placed, if different from the district of residence, shall notify 
the district of residence of the emergency placement within 15 days of the 
placement. 
 (c) When a pupil without a disability is temporarily 
placed for care and treatment in a day program and the pupil continues to live 
within the district of residence during the care and treatment, the district of 
residence shall provide instruction and necessary transportation for the pupil. 
The district may provide the instruction at a school within the district of 
residence, at the pupil's residence, or in the case of a placement outside of 
the resident district, in the district in which the day treatment program is 
located by paying tuition to that district. The district of placement may 
contract with a facility to provide instruction by teachers licensed by the 
state board of teaching. 
 (d) When a pupil without a disability is temporarily 
placed in a residential program for care and treatment, the district in which 
the pupil is placed shall provide instruction for the pupil and necessary 
transportation while the pupil is receiving instruction, and in the case of a 
placement outside of the district of residence, the nonresident district shall 
bill the district of residence for the actual cost of providing the instruction 
for the regular school year and for summer school, excluding transportation 
costs. When a pupil without a disability is temporarily placed in a residential 
program outside the district of residence, the administrator of the court 
placing the pupil shall send timely written notice of the placement to the 
district of residence. The district of placement may contract with a residential 
facility to provide instruction by teachers licensed by the state board of 
teaching. For purposes of this section, the state 
correctional facilities operated on a fee-for-service basis are considered to be 
residential programs for care and treatment. 
 (e) The district of residence shall include the pupil in 
its residence count of pupil units and pay tuition as provided in section 124.18 
to the district providing the instruction. Transportation costs shall be paid by 
the district providing the transportation and the state shall pay transportation 
aid to that district. For purposes of computing state transportation aid, pupils 
governed by this subdivision shall be included in the disabled transportation 
category. 
 Sec. 19. Minnesota Statutes 1996, section 123.935, 
subdivision 1, is amended to read: 
 Subdivision 1. [PROVIDED SERVICES.] The state board of 
education shall promulgate rules under the provisions of chapter 14 requiring 
each school district or other intermediary service area: (a) to provide each 
year upon formal request by a specific date by or on behalf of a nonpublic 
school pupil enrolled in a nonpublic school located in that district or area, 
the same specific health services as are provided for public school pupils by 
the district where the nonpublic school is located; and (b) to provide each year 
upon formal request by a specific date by or on behalf of a nonpublic school 
secondary pupil enrolled in a nonpublic school located in that district or area, 
the same specific guidance and counseling services as are provided for public 
school secondary pupils by the district where the nonpublic school is located. 
The district where the nonpublic school is located shall provide the necessary 
transportation within the district boundaries between the nonpublic school and a 
public school or neutral site for nonpublic school pupils who are provided pupil 
support services  Sec. 20. Minnesota Statutes 1996, section 123.935, 
subdivision 2, is amended to read: 
 Subd. 2. [LOCATION OF SERVICES.] Health and guidance and counseling services may be provided to 
nonpublic school pupils  Sec. 21. Minnesota Statutes 1996, section 124.17, 
subdivision 2, is amended to read: 
 Subd. 2. [AVERAGE DAILY MEMBERSHIP.] Membership for 
pupils in grades kindergarten through 12 and for prekindergarten pupils with 
disabilities shall mean the number of pupils on the current roll of the school, 
counted from the date of entry until withdrawal. The date of withdrawal shall 
mean the day the pupil permanently leaves the school or the date it is 
officially known that the pupil has left or has been legally excused. However, a 
pupil, regardless of age, who has been absent from school for 15 consecutive 
school days during the regular school year or for five consecutive school days 
during summer school or intersession classes of flexible school year programs 
without receiving instruction in the home or hospital shall be dropped from the 
roll and classified as withdrawn. Nothing in this section shall be construed as 
waiving the compulsory attendance provisions cited in section 120.101. Average 
daily membership shall equal the sum for all pupils of the number of days of the 
school year each pupil is enrolled in the district's schools divided by the 
number of days the schools are in session. Days of summer school or intersession 
classes of flexible school year programs shall only be included in the 
computation of membership for pupils with a disability not appropriately served  Sec. 22. Minnesota Statutes 1997 Supplement, section 
124.3111, subdivision 2, is amended to read: 
 Subd. 2. [ELIGIBLE PUPILS.] A pupil is eligible to 
receive services through an assurance of mastery program if the pupil has not 
demonstrated progress toward mastering the required graduation standards, after 
receiving instruction that was designed to enable the pupil to make progress 
toward mastering the required graduation standards in a regular classroom 
setting. A pupil also is eligible to receive services 
through an assurance of mastery program if the pupil, based on the professional 
judgment of a classroom teacher or a team of licensed professionals, 
demonstrates a need for alternative instructional strategies or 
interventions. To determine pupil eligibility, a district must use a process 
adopted by the school board to review curriculum and instruction, for the 
subjects and at the grade level at which the district uses the revenue. 
 Sec. 23. Minnesota Statutes 1997 Supplement, section 
124.3111, subdivision 3, is amended to read: 
 Subd. 3. [ELIGIBLE SERVICES.] (a) Assurance of mastery 
programs may provide direct instructional services to an eligible pupil, or a 
group of eligible pupils, under the following conditions in paragraphs (b) to  (b) Instruction may be provided at one or more grade 
levels from kindergarten to grade 8 and for students in grades 9 through 12 who 
have failed the basic skills tests. If an assessment of pupils' needs within a 
district demonstrates that the eligible pupils in grades kindergarten to grade 8 
are being appropriately served, a district may serve eligible pupils in grades 9 
to 12. 
 (c) Instruction must be provided under the supervision of 
the eligible pupil's regular classroom teacher. Instruction may be provided by 
the eligible pupil's classroom teacher, by another teacher, by a team of 
teachers, or by an education assistant or aide. A special education teacher may 
provide instruction, but instruction that is provided under this section is not 
eligible for aid under section 124.3201. 
 (d) The instruction that is provided must differ from the 
initial instruction the pupil received in the regular classroom setting. The 
instruction may differ by presenting different curriculum than was initially 
presented in the regular classroom or by presenting the same curriculum: 
 (1) at a different rate or in a different sequence than 
it was initially presented; 
 (2) using different teaching methods or techniques than 
were used initially; or 
 (3) using different instructional materials than were 
used initially. 
 (e) Instruction must focus on 
preventive measures that meet students' individual needs. 
 Sec. 24. Minnesota Statutes 1996, section 124.32, is 
amended by adding a subdivision to read: 
 Subd. 13. [LITIGATION AND 
HEARING COSTS.] (a) For fiscal year 1999 and thereafter, 
the commissioner of children, families, and learning, or the commissioner's 
designee, shall use federal funds to reimburse school districts for the 
administrative costs of a due process hearing incurred under section 120.17, 
subdivision 3b, paragraphs (e), (h), and (i), including hearing officer fees, 
court reporter fees, mileage costs, transcript costs, and rental of hearing 
rooms, but not including district legal or attorney fees. In order to receive 
federal aid under this paragraph, a school district shall submit to the 
commissioner at the end of each school year itemized actual costs for fees and 
other expenses under this paragraph. Federal funds used for aid to school 
districts under this paragraph shall be based on costs districts submitted 
during the previous school year. 
 (b) For fiscal year 1999 and 
thereafter, a school district, to the extent to which it prevails as prescribed 
by Rule 68 of the Federal Rules of Civil Procedure, shall receive state aid for 
litigation costs incurred after a request for a due process hearing is served 
upon the parties based on 50 percent of the costs associated with a due process 
hearing under section 120.17, subdivision 3b, paragraphs (e), (h), and (i), not 
covered under paragraph (a), including hearing officer fees, court reporter 
fees, expert witness fees, mileage costs, transcript costs, cost of outside 
evaluations ordered by the hearing officer, rental of hearing rooms, and 
district legal or attorney fees. No more than 60 percent of the aid a school 
district receives under this paragraph shall be for the costs of district legal 
or attorney fees, which shall be available only if the district can 
satisfactorily demonstrate to the commissioner that it is the prevailing party 
under Rule 68 of the Federal Rules of Civil Procedure, and the district has made 
a good faith effort to resolve the dispute through mediation. To receive aid 
under this paragraph, a school district shall submit to the commissioner at the 
end of each school year itemized actual costs associated with due process 
hearing and indicate those costs for which federal funds are available under 
paragraph (a). Aid under this paragraph for each school district is based on 
costs submitted from the previous school year. 
 Sec. 25. Minnesota Statutes 1997 Supplement, section 
124.3201, subdivision 1, is amended to read: 
 Subdivision 1. [DEFINITIONS.] For the purposes of this 
section and section 124.321, the definitions in this subdivision apply. 
 (a) "Base year" for fiscal year  (b) "Basic revenue" has the meaning given it in section 
124A.22, subdivision 2. For the purposes of computing basic revenue pursuant to 
this section, each child with a disability shall be counted as prescribed in 
section 124.17, subdivision 1. 
 (c) "Essential personnel" means teachers, related 
services, and support services staff providing direct services to students. 
 (d) "Average daily membership" has the meaning given it 
in section 124.17. 
 (e) "Program growth factor" means 1.00 for fiscal year 
2000 and later. 
 (f) "Aid percentage factor" means 60 percent for fiscal 
year 1996, 70 percent for fiscal year 1997, 80 percent for fiscal year 1998, 90 
percent for fiscal year 1999, and 100 percent for fiscal years 2000 and later. 
 (g) "Levy percentage factor" means 100 minus the aid 
percentage factor for that year. 
 Sec. 26. Minnesota Statutes 1997 Supplement, section 
124.3201, subdivision 2, is amended to read: 
 Subd. 2. [SPECIAL EDUCATION BASE REVENUE.] (a) The 
special education base revenue equals the sum of the following amounts computed 
using base year data: 
 (1) 68 percent of the salary of each essential person 
employed in the district's program for children with a disability during the  (2) for the Minnesota state academy for the deaf or the 
Minnesota state academy for the blind, 68 percent of the salary of each 
instructional aide assigned to a child attending the academy, if that aide is 
required by the child's individual education plan; 
 (3) for special instruction and services provided to any 
pupil by contracting with public, private, or voluntary agencies other than 
school districts, in place of special instruction and services provided by the 
district, 52 percent of the difference between the amount of the contract and 
the basic revenue of the district for that pupil for the fraction of the school 
day the pupil receives services under the contract; 
 (4) for special instruction and services provided to any 
pupil by contracting for services with public, private, or voluntary agencies 
other than school districts, that are supplementary to a full educational 
program provided by the school district, 52 percent of the amount of the 
contract for that pupil; 
 (5) for supplies and equipment purchased or rented for 
use in the instruction of children with a disability an amount equal to 47 
percent of the sum actually expended by the district, or 
a Minnesota correctional facility operating on a fee-for-service basis, but 
not to exceed an average of $47 in any one school year for each child with a 
disability receiving instruction; 
 (6) for fiscal years 1997 and later, special education 
base revenue shall include amounts under clauses (1) to (5) for special 
education summer programs provided during the base year for that fiscal year; 
and 
 (7) for fiscal years 1999 and later, the cost of 
providing transportation services for children with disabilities under section 
124.225, subdivision 1, paragraph (b), clause (4). 
 (b) If requested by a school district operating a special 
education program during the base year for less than the full  (c) Notwithstanding paragraphs (a) 
and (b), the portion of a school district's base revenue attributable to a 
Minnesota correctional facility operating on a fee-for-service basis during the 
facilities first year of operating on a fee-for-service basis shall be computed 
using current year data. 
 Sec. 27. Minnesota Statutes 1997 Supplement, section 
124.3201, subdivision 4, is amended to read: 
 Subd. 4. [STATE TOTAL SPECIAL EDUCATION REVENUE.] (a) The state total special education revenue for fiscal 
year 1998 equals $358,542,000. The state total special education revenue for 
fiscal year 1999 equals $435,322,000. The state total special education revenue 
for later fiscal years equals: 
 (1) the state total special education revenue for the 
preceding fiscal year; times 
 (2) the program growth factor; times 
 (3) the ratio of the state total average daily membership 
for the current fiscal year to the state total average daily membership for the 
preceding fiscal year. 
 (b) For fiscal years 2000 and 
later, the commissioner shall increase the state total special education revenue 
amount by the amount of any decrease in the excess cost aid program due to 
eliminating the two-year lag under subdivision 1. 
 Sec. 28. Minnesota Statutes 1996, section 124.3201, 
subdivision 5, is amended to read: 
 Subd. 5. [SCHOOL DISTRICT SPECIAL EDUCATION REVENUE.] (a) 
A school district's special education revenue for fiscal year 1996 and later 
equals the state total special education revenue, minus the amount determined 
under paragraph (b), times the ratio of the district's adjusted special 
education base revenue to the state total adjusted special education base 
revenue. If the state board of education modifies its rules for special 
education in a manner that increases a school district's special education 
obligations or service requirements, the commissioner of children, families, and 
learning shall annually increase each district's special education revenue by 
the amount necessary to compensate for the increased service requirements. The 
additional revenue equals the cost in the current year attributable to rule 
changes not reflected in the computation of special education base revenue, 
multiplied by the appropriate percentages from subdivision 2. 
 (b) Notwithstanding paragraph (a), if the special 
education base revenue for a district equals zero, the special education revenue 
equals the amount computed according to subdivision 2 using current year data. 
 (c) If the state special education 
base revenue is not known during the current year, the department of children, 
families, and learning shall initially calculate school district special 
education revenue based on 95 percent of the state total special education 
revenue established in subdivision 4 until the special education base revenue is 
known. 
 Sec. 29. Minnesota Statutes 1996, section 124.323, is 
amended by adding a subdivision to read: 
 Subd. 4. [TUITION.] Notwithstanding section 120.17, for children who are 
nonresidents of Minnesota, receive services under section 124.3201, subdivisions 
1 and 2, and are placed in the serving school district by court action, the 
serving school district shall submit unreimbursed tuition bills for eligible 
services to the department of children, families, and learning instead of the 
resident school district. To be eligible for reimbursement, the serving school 
district, as part of its child intake procedures, must demonstrate good faith 
effort to obtain from the placing agency a financial commitment to pay tuition 
costs. 
 Sec. 30. Minnesota Statutes 1996, section 124.323, is 
amended by adding a subdivision to read: 
 Subd. 5. [COURT-PLACED SPECIAL 
EDUCATION REVENUE.] For purposes of reimbursing serving 
school districts under subdivision 4, $300,000 is annually appropriated from the 
general fund to the commissioner of children, families, and learning for 
unreimbursed eligible expenditures attributable to children who have been placed 
in the serving school district by court action. 
 Sec. 31. Minnesota Statutes 1996, section 124A.034, 
subdivision 2, is amended to read: 
 Subd. 2. [LOCATION OF SERVICES.] (a) Public school programs that 
provide instruction in core curriculum may be provided to shared time pupils 
only at a public school building;  (b) For those children with a 
disability under section 120.17 who attend nonpublic school and for whom a free 
and appropriate education is available at a public school, a school district may 
provide special instruction and services at the nonpublic school building only 
to the extent required under the Individuals with Disabilities Education Act, 
Public Law Number 105-17, as amended. A school district may provide special 
instruction and services for such children at a neutral site as defined in 
section 123.932, subdivision 9. 
 Sec. 32. Minnesota Statutes 1996, section 124A.036, 
subdivision 1a, is amended to read: 
 Subd. 1a. [REPORTING; REVENUE FOR HOMELESS.] For all 
school purposes, unless otherwise specifically provided by law, a homeless pupil 
 Sec. 33. Minnesota Statutes 1996, section 124A.036, is 
amended by adding a subdivision to read: 
 Subd. 1b. [REVENUE FOR 
CHILDREN OF DIVORCED PARENTS.] (a) In those instances 
when the divorced parents share joint physical custody of the child and the 
divorced parents reside in different school districts, for all school purposes, 
unless otherwise specifically provided by law, the child must be considered a 
resident of the school district in which the child resides for the majority of 
the school year, as indicated by the child's parents. 
 (b) When the child of divorced 
parents under paragraph (a) resides with each parent on alternate weeks, the 
parents shall transport the child to the border of the resident school district 
during those weeks when the child resides in the nonresident school 
district. 
 Sec. 34. Minnesota Statutes 1996, section 124A.036, 
subdivision 4, is amended to read: 
 Subd. 4. [STATE AGENCY AND COURT PLACEMENTS.] If a state 
agency or a court of the state desires to place a child in a school district 
which is not the child's district of residence or to 
place a pupil who is a parent under section 120.101, subdivision 3, in a school 
district which is not the school district in which the pupil's biological or 
adoptive parent or designated guardian resides, that agency or court shall, 
prior to placement, allow the district of residence an opportunity to 
participate in the placement decision and notify the district of residence, the 
district of attendance and the commissioner of children, families, and learning 
of the placement decision. When a state agency or court determines that an 
immediate emergency placement is necessary and that time does not permit 
district participation in the placement decision or notice to the districts and 
the commissioner of children, families, and learning of the placement decision 
prior to the placement, the agency or court may make the decision and placement 
without that participation or prior notice. The agency or court shall notify the 
district of residence, the district of attendance and the commissioner of 
children, families, and learning of an emergency placement within 15 days of the 
placement. 
 Sec. 35. Minnesota Statutes 1996, section 124C.45, 
subdivision 2, is amended to read: 
 Subd. 2. [ACCESS TO SERVICES.] A center shall have access 
to the district's regular education programs, special 
education programs, technology facilities, and staff. It may contract with 
individuals or post-secondary institutions. It shall seek the involvement of 
community education programs, post-secondary institutions, interagency collaboratives, community resources, 
businesses, and other federal, state, and local public agencies. 
 Sec. 36. Minnesota Statutes 1997 Supplement, section 
124C.46, subdivision 1, is amended to read: 
 Subdivision 1. [PROGRAM FOCUS.] (a) The programs and services of a center must focus on 
academic and learning skills, applied learning opportunities, trade and 
vocational skills, work-based learning opportunities, work experience, youth 
service to the community, and transition services. Applied learning, work-based 
learning, and service learning may best be developed in collaboration with a 
local education and transitions partnership. In addition to offering programs, 
the center shall coordinate the use of other available educational services, special education services, social services, health 
services, and post-secondary institutions in the community and services area. 
 (b) Consistent with the 
requirements of sections 127.26 to 127.39, a school district may provide an 
alternative education program for a student who is within the compulsory 
attendance age under section 120.06 and who is involved in severe or repeated 
disciplinary action. 
 (c) Area learning centers are 
encouraged to offer extended-day and extended-year programs to pupils who are at 
risk of not meeting state graduation standards. 
 Sec. 37. Minnesota Statutes 1997 Supplement, section 
124C.46, subdivision 2, is amended to read: 
 Subd. 2. [PEOPLE TO BE SERVED.] A center shall provide 
programs for secondary pupils and adults. A center may also provide programs and 
services for elementary and secondary pupils who are not attending the center to 
assist them in being successful in school. An individual 
education plan team may identify a center as an appropriate placement to the 
extent a center can provide the student with the appropriate special education 
services described in the student's plan. Pupils eligible to be served are 
those age five to adults  Sec. 38. Minnesota Statutes 1996, section 124C.47, is 
amended to read: 
 124C.47 [RESOURCE CENTER FOR OTHER PROGRAMS.] 
 An area learning center must serve as a resource for 
other districts, educational, community, and business organizations. The center 
may charge a fee for these services. The following services shall be provided 
for a region or the state: 
 (1) information and research for alternative programs; 
 (2) regional or state workshops on awareness, 
identification, programs, and support for these pupils;  (3) recommendations for staff qualifications to ensure 
the most qualified staff can be selected for the programs; and 
 (4) recommendations for successful 
learning programs for special education students placed in an alternative 
setting. 
 Sec. 39. Minnesota Statutes 1996, section 124C.48, is 
amended by adding a subdivision to read: 
 Subd. 3. [SPECIAL EDUCATION 
REVENUE.] Payment of special education revenue for 
nonresident pupils enrolled in the center must be made according to section 
120.17, subdivision 6. 
 Sec. 40. Minnesota Statutes 1996, section 126.237, is 
amended to read: 
 126.237 [ALTERNATE INSTRUCTION REQUIRED.] 
 (a) Before a pupil is referred 
for a special education assessment, the district must conduct and document at 
least two instructional strategies, alternatives, or interventions while the 
pupil is in the regular classroom. The pupil's teacher must provide the 
documentation. A special education assessment team may waive this requirement 
when they determine the pupil's need for the assessment is urgent. This section 
may not be used to deny a pupil's right to a special education assessment. 
 (b) A school district shall adopt 
procedures for using alternative intervention services, including the assurance 
of mastery program under section 124.3111 and the first grade preparedness 
program under section 124.2613, to serve at-risk students who demonstrate a need 
for alternative instructional strategies or interventions. 
 Sec. 41. Minnesota Statutes 1996, section 127.27, 
subdivision 2, is amended to read: 
 Subd. 2. [DISMISSAL.] "Dismissal" means the denial of the 
 Sec. 42. Minnesota Statutes 1996, section 127.27, 
subdivision 4, is amended to read: 
 Subd. 4. [EXCLUSION.] "Exclusion" means an action taken 
by the school board to prevent enrollment or reenrollment of a pupil for a 
period that shall not extend beyond the end of the 
current school year. 
 Sec. 43. Minnesota Statutes 1997 Supplement, section 
127.27, subdivision 10, is amended to read: 
 Subd. 10. [SUSPENSION.] "Suspension" means an action by 
the school administration, under rules promulgated by the school board, 
prohibiting a pupil from attending school for a period of no more than ten 
school days. If a suspension is longer than five days, the suspending 
administrator must provide the superintendent with a reason for the longer 
suspension. This definition does not apply to dismissal from school for one 
school day or less, except as provided in federal law for 
a student with a disability. Each suspension action  Sec. 44. Minnesota Statutes 1997 Supplement, section 
127.27, subdivision 11, is amended to read: 
 Subd. 11. [ALTERNATIVE EDUCATIONAL SERVICES.] 
"Alternative educational services" may include, but are not limited to, special 
tutoring, modified curriculum, modified instruction, other modifications or 
adaptations, instruction through electronic media, 
special education services as indicated by appropriate assessment, homebound 
instruction, supervised homework, or enrollment in 
another district or in an alternative learning center under section 124C.45 selected to allow the pupil to progress toward meeting 
graduation standards under section 121.11, subdivision 7c, although in a 
different setting. 
 Sec. 45. Minnesota Statutes 1997 Supplement, section 
127.281, is amended to read: 
 127.281 [EXCLUSION AND EXPULSION OF PUPILS WITH A 
DISABILITY.] 
 When a pupil who has an individual education plan is 
excluded or expelled under sections 127.26 to 127.39 for misbehavior that is not 
a manifestation of the pupil's disability, the district shall continue to 
provide special education and related services after a period of suspension, if 
suspension is imposed. The district shall initiate a review of the individual 
education plan within  Sec. 46. Minnesota Statutes 1997 Supplement, section 
127.31, subdivision 15, is amended to read: 
 Subd. 15. [ADMISSION OR READMISSION PLAN.] A school 
administrator shall prepare and enforce an admission or readmission plan for any 
pupil who is  Sec. 47. Minnesota Statutes 1997 Supplement, section 
127.32, is amended to read: 
 127.32 [APPEAL.] 
 A party to an exclusion or expulsion decision made under 
sections 127.26 to 127.39 may appeal the decision to the commissioner of 
children, families, and learning within 21 calendar days of school board action. 
Upon being served with a notice of appeal, the district shall provide the 
commissioner and the parent or guardian with a complete copy of the hearing 
record within five days of its receipt of the notice of appeal. All written 
submissions by the appellant must be submitted and served on the respondent 
within ten days of its actual receipt of the transcript. All written submissions 
by the respondent must be submitted and served on the appellant within ten days 
of its actual receipt of the written submissions of the appellant. The decision of the school board must be implemented during 
the appeal to the commissioner. 
 In an appeal under this section, the commissioner may 
affirm the decision of the agency, may remand the 
decision for additional findings, or may reverse or modify the decision if 
the substantial rights of the petitioners  (1) in violation of constitutional provisions; 
 (2) in excess of the statutory authority or jurisdiction 
of the school district; 
 (3) made upon unlawful procedure, except as provided in 
section 127.311; 
 (4) affected by other error of law; 
 (5) unsupported by substantial evidence in view of the 
entire record submitted; or 
 (6) arbitrary or capricious. 
 The commissioner or the commissioner's representative 
shall make a final decision based upon the record  Sec. 48. Minnesota Statutes 1997 Supplement, section 
127.36, subdivision 1, is amended to read: 
 Subdivision 1. [EXCLUSIONS AND EXPULSIONS.] The school 
board shall report each exclusion or expulsion within 30 days of the effective 
date of the action to the commissioner of children, families, and learning. This 
report shall include a statement of alternative educational services given the 
pupil  Sec. 49. Minnesota Statutes 1997 Supplement, section 
127.38, is amended to read: 
 127.38 [POLICIES TO BE ESTABLISHED.] 
 (a) The commissioner of children, families, and learning 
shall promulgate guidelines to assist each school board. Each school board shall 
establish uniform criteria for dismissal and adopt written policies and rules to 
effectuate the purposes of sections 127.26 to 127.39. The policies shall 
emphasize preventing dismissals through early detection of problems and shall be designed to address students' inappropriate 
behavior from recurring. The policies shall recognize the continuing 
responsibility of the school for the education of the pupil during the dismissal 
period. The alternative educational services, if the pupil wishes to take 
advantage of them, must be adequate to allow the pupil to make progress towards 
meeting the graduation standards adopted under section 121.11, subdivision 7c, 
and, at a minimum, appropriate to the grade level the 
pupil would have been enrolled in if the pupil had not been dismissed, and 
help prepare the pupil for readmission. 
 (b) An area learning center under section 124C.45 may not 
prohibit an expelled or excluded pupil from enrolling solely because a district 
expelled or excluded the pupil. The board of the area learning center may use 
the provisions of The Pupil Fair Dismissal Act to exclude a pupil or to require 
an admission plan. 
 (c) The commissioner shall actively encourage and assist 
school districts to cooperatively establish alternative educational services within school buildings or at alternative program sites 
that offer instruction to pupils who are dismissed from school for willfully 
engaging in dangerous, disruptive, or violent behavior, including for possessing 
a firearm in a school zone. 
 Sec. 50. Minnesota Statutes 1996, section 256B.0625, 
subdivision 26, is amended to read: 
 Subd. 26. [SPECIAL EDUCATION SERVICES.] Medical 
assistance covers medical services identified in a recipient's individualized 
education plan and covered under the medical assistance state plan. The services 
may be provided by a Minnesota school district that is enrolled as a medical 
assistance provider or its subcontractor, and only if the services meet all the 
requirements otherwise applicable if the service had been provided by a provider 
other than a school district, in the following areas: medical necessity, 
physician's orders, documentation, personnel qualifications, and prior 
authorization requirements. Services of a speech-language 
pathologist provided under this section are covered notwithstanding Minnesota 
Rules, part 9505.0390, subpart 1, item L, if the person: 
 (1) holds a masters degree in 
speech-language pathology; 
 (2) is licensed by the Minnesota 
board of teaching as an educational speech-language pathologist; and 
 (3) either has a certificate of 
clinical competence from the American Speech and Hearing Association, has 
completed the equivalent educational requirements and work experience necessary 
for the certificate or has completed the academic program and is acquiring 
supervised work experience to qualify for the certificate. Medical 
assistance coverage for medically necessary services provided under other 
subdivisions in this section may not be denied solely on the basis that the same 
or similar services are covered under this subdivision. 
 Sec. 51. Laws 1997, First Special Session chapter 4, 
article 2, section 51, subdivision 2, is amended to read: 
 Subd. 2. [AMERICAN INDIAN LANGUAGE AND CULTURE PROGRAMS.] 
For grants to American Indian language and culture education programs according 
to Minnesota Statutes, section 126.54, subdivision 1: 
 $591,000 . . . . . 1998 
 The 1998 appropriation includes $59,000 for 1997 and 
$532,000 for 1998. 
 The 1999 appropriation includes $59,000 for 1998 and  Any balance in the first year does not cancel but is 
available in the second year. 
 Sec. 52. Laws 1997, First Special Session chapter 4, 
article 2, section 51, subdivision 4, is amended to read: 
 Subd. 4. [AMERICAN INDIAN POST-SECONDARY PREPARATION 
GRANTS.] For American Indian post-secondary preparation grants according to 
Minnesota Statutes, section 124.481: 
 $857,000 . . . . . 1998 
 Any balance in the first year does not cancel but is 
available in the second year. 
 Sec. 53. Laws 1997, First Special Session chapter 4, 
article 2, section 51, subdivision 5, is amended to read: 
 Subd. 5. [AMERICAN INDIAN SCHOLARSHIPS.] For American 
Indian scholarships according to Minnesota Statutes, section 124.48: 
 $1,600,000 . . . . . 1998 
 Any balance in the first year does not cancel but is 
available in the second year. 
 Sec. 54. [RULES AFFECTING SPECIAL EDUCATION INSTRUCTION 
AND SERVICES.] 
 (a) The state board of education 
must amend all rules relating to providing special instruction and services to 
children with a disability so that the rules do not impose requirements that 
exceed federal law. The state board, with the assistance of the department of 
children, families, and learning, shall provide a written report to the 
education committees of the legislature by January 1, 1999, identifying and 
explaining those state special education rules that exceed federal special 
education requirements by improving services or efficiency or reducing state or 
district costs. The state board may use the expedited process under Minnesota 
Statutes, section 14.389, to amend these rules. 
 (b) As of July 1, 1999, any rules 
relating to providing special instruction and services to children with a 
disability are invalid to the extent they exceed the requirements in federal law 
unless a law is enacted before July 1, 1999, indicating the intent of the state 
to exceed one or more federal requirements. 
 Sec. 55. [GRANTS TO IMPLEMENT CONSTRUCTIVE SCHOOL 
DISCIPLINE POLICIES.] 
 Subdivision 1. 
[ESTABLISHMENT.] A grant program for fiscal year 1999 is 
established to develop, implement, and evaluate school discipline policies, 
consistent with the Pupil Fair Dismissal Act of 1974 under Minnesota Statutes, 
sections 127.26 to 127.39 and 127.40 to 127.48. Discipline policies developed 
under this section should be designed to enable students to successfully return 
to the regular classroom setting after being disciplined for misbehavior. 
Discipline policies should focus on early intervention strategies that limit the 
need to provide regular education students with additional special programs or 
services. 
 Subd. 2. [ELIGIBILITY.] An applicant for a grant must be a school site, school 
district, charter school, or provider of an alternative education program. To be 
eligible for a grant, the grant applicant must meet all of the following 
criteria: 
 (1) develop a plan to establish a 
school site mediation board under Minnesota Statutes, sections 127.411 to 
127.42, to mediate issues relating to district or school site codes of conduct 
that apply to regular and special education students; 
 (2) include in the code of conduct 
a plan to remove from the regular classroom setting those students who violate 
the code; 
 (3) provide students who violate 
the code with an alternative education setting within the school or program 
site; and 
 (4) make the alternative education 
setting a constructive experience by using instructional materials tied to 
educational standards, placing students in an alternative setting outside the 
normal school day, involving parents in effecting discipline, or developing 
intervention techniques such as timeouts, among other alternatives. 
 Subd. 3. [APPLICATION 
PROCESS.] To obtain a grant to implement constructive 
school discipline policies, a grant applicant must submit an application to the 
commissioner of children, families, and learning in the form and manner the 
commissioner establishes. The application must describe how the applicant will 
meet the eligibility criteria under subdivision 2. The commissioner may require 
the applicant to provide additional information. 
 Subd. 4. [GRANT AWARDS.] The commissioner may award up to five grants of up to 
$50,000. Grant recipients must be located throughout the state and have diverse 
experiences with student disciplinary matters. The amount of the grant shall be 
based on the number of students the grant recipient anticipates will be 
disciplined and on the alternative education settings the grant recipient 
proposes to use. Grant recipients must use the grant proceeds to accomplish the 
purposes of this section. 
 Subd. 5. [EVALUATION.] The commissioner shall evaluate the grant sites and selected 
control sites to determine the impact of the constructive discipline policy 
grant program on measures of student behavior and performance, including at 
least, student achievement and attendance, and the impact of the program on the 
school site, student body, classroom, and school faculty. The evaluation must 
also address the financial impact of the program on the district and the school 
site. Upon implementing a student code of conduct consistent with this section, 
the grant recipient must cooperate in evaluating the impact of code policies. As 
a part of the evaluation process, the grant recipient must document student and 
parent response to code policies over at least a three-year period. The 
commissioner shall compile for the education committees of the legislature a 
progress report by February 1, 1999, and a final report by February 1, 2001, on 
the effectiveness and impact of discipline policies. 
 Sec. 56. [SPEECH-LANGUAGE PATHOLOGISTS.] 
 The board of teaching shall allow 
individuals who hold a certificate of clinical competence from the American 
Speech-Language-Hearing Association to be licensed as speech-language 
pathologists. 
 Sec. 57. [BOARD OF TEACHING; RULE CHANGES; 
SPEECH-LANGUAGE SERVICES.] 
 The board of teaching, in order to 
comply with section 56, shall by rule allow individuals who hold a certificate 
of clinical competence from the American Speech-Language-Hearing Association to 
be licensed as speech-language pathologists. 
 Sec. 58. [SPECIAL EDUCATION BASE ADJUSTMENT; ROCHESTER.] 
 Special education base revenue for 
independent school district No. 535, Rochester, is increased by $150,000 per 
year for fiscal years 1998 and 1999 to reflect the increased special education 
costs associated with the opening of a new facility for juvenile offenders in 
Olmsted county. 
 Sec. 59. [REPORT TO COMPARE FEDERAL AND STATE SPECIAL 
EDUCATION LAW.] 
 The commissioner of children, 
families, and learning shall prepare a report comparing existing and currently 
proposed federal laws and regulations and state laws and rules governing special 
education, indicating those state laws and rules governing special education 
that exceed or expand upon minimum requirements under federal special education 
law or regulations and the rationale for the state to exceed or expand upon 
those federal requirements. The commissioner shall make the report available to 
the public, the education committees of the legislature, and the state board by 
September 30, 1998, for consideration in amending state rules under section 
54. 
 Sec. 60. [APPROPRIATIONS.] 
 Subdivision 1. [DEPARTMENT OF 
CHILDREN, FAMILIES, AND LEARNING.] The sums indicated in 
this section are appropriated from the general fund to the department of 
children, families, and learning for the fiscal years designated. 
 Subd. 2. [CONSTRUCTIVE SCHOOL 
DISCIPLINE POLICIES.] For grants to develop, implement, 
and evaluate school discipline policies under section 55: 
 $250,000 . . . . . 1999 
 Grant recipients may expend grant 
proceeds over a three-year period. Of this amount, $13,500 is for performing an 
evaluation. 
 Subd. 3. [STATEWIDE 
THIRD-PARTY BILLING SYSTEM; ASSISTANCE.] For developing 
and implementing an effective and efficient statewide third-party billing system 
under section 2: 
 $200,000 . . . . . 1999 
 Funds remain available until 
expended. 
 Subd. 4. [LITIGATION COSTS.] 
For paying 50 percent of the litigation costs a district 
actually incurs under section 24, paragraph (b): 
 $300,00 . . . . . 1999 
 If the amount appropriated is 
insufficient to fully fund the aid for hearing and litigation costs under 
Minnesota Statutes, section 124.32, subdivision 13, paragraph (b), the 
commissioner shall prorate the appropriation to school districts based on the 
amount of aid calculated for each district. 
 Subd. 5. [PROVIDING TECHNICAL 
ASSISTANCE.] For department staff to provide technical 
assistance and training to school districts and cooperative units under section 
2: 
 $50,000 . . . . . 1999 
 Subd. 6. [COURT-PLACED SPECIAL 
EDUCATION REVENUE.] For reimbursing serving school 
districts for unreimbursed eligible expenditures attributable to children placed 
in the serving school district by court action under Minnesota Statutes, section 
124.323: 
 $300,000 . . . . . 1999 
 Sec. 61. [PROVIDING TECHNICAL ASSISTANCE.] 
 $50,000 is appropriated in fiscal 
year 1999 from the general fund to the commissioner of human services to provide 
technical assistance and training under section 2. 
 Sec. 62. [REPEALER.] 
 Minnesota Rules, part 3525.2750, 
subpart 1, item B, is repealed. 
 Sec. 63. [EFFECTIVE DATE.] 
 Sections 9, 22, 46, 47, 48, 49, 
50, 51, 52, 53, 54, 55, 56, 57, and 58 are effective the day following final 
enactment. 
 
 
 Section 1. Minnesota Statutes 1996, section 120.1701, 
subdivision 2, is amended to read: 
 Subd. 2. [DEFINITIONS.] For the purposes of this section 
the following terms have the meaning given them. 
 (a) "Coordinate" means to provide ready access to a 
community's services and resources to meet child and family needs. 
 (b) "Core early intervention services" means services 
that are available at no cost to children and families. These services include: 
 (1) identification and referral; 
 (2) screening; 
 (3) evaluation; 
 (4) assessment; 
 (5) service coordination; 
 (6) special education and related services provided under 
section 120.17, subdivision 3a, and United States Code, title 20, section 1401; 
and 
 (7) protection of parent and child rights by means of 
procedural safeguards. 
 (c) "County board" means a county board established under 
chapter 375. 
 (d) "Early intervention record" means any personally 
identifiable information about a child or the child's family that is generated 
by the early intervention system, and that pertains to evaluation and 
assessment, development of an individualized family service plan, and the 
delivery of early intervention services. 
 (e) "Early intervention services" means services provided 
in conformity with an individualized family service plan that are designed to 
meet the special developmental needs of a child eligible under Code of Federal 
Regulations, title 34, part 303, and the needs of the child's family related to 
enhancing the child's development and that are selected in collaboration with 
the parent. These services include core early intervention services and 
additional early intervention services listed in subdivision 4 and services 
defined in Code of Federal Regulations, title 34, section 303, et seq. 
 (f) "Early intervention system" means the total effort in 
the state to meet the needs of eligible children and their families, including, 
but not limited to: 
 (1) any public agency in the state that receives funds 
under the Individuals with Disabilities Education Act, United States Code, title 
20, sections 1471 to 1485 (Part H, Public Law Number 102-119); 
 (2) other state and local agencies administering programs 
involved in the provision of early intervention services, including, but not 
limited to: 
 (i) the Maternal and Child Health program under title V 
of the Social Security Act, United States Code, title 42, sections 701 to 709; 
 (ii) the Individuals with Disabilities Education Act, 
United States Code, title 20, sections 1411 to 1420 (Part B); 
 (iii) medical assistance under the Social Security Act, 
United States Code, title 42, section 1396 et seq.; 
 (iv) the Developmental Disabilities Assistance and Bill 
of Rights Act, United States Code, title 42, sections 6021 to 6030 (Part B); and 
 (v) the Head Start Act, United States Code, title 42, 
sections 9831 to 9852; and 
 (3) services provided by private groups or third-party 
payers in conformity with an individualized family service plan. 
 (g) "Eligibility for Part H" means eligibility for early 
childhood special education under section 120.03 and Minnesota Rules, part 
3525.2335, subpart 1, items A and B. 
 (h) "Facilitate payment" means helping families access 
necessary public or private assistance that provides payment for services 
required to meet needs identified in a service plan, individual education plan 
(IEP), individual service plan (ISP), or individualized family service plan 
(IFSP), according to time frames required by the plan. This may also include 
activities to collect fees for services provided on a sliding fee basis, where 
permitted by state law. 
 (i) "Individualized family service plan" or "IFSP" means 
a written plan for providing services to a child and the child's family. 
 (j) "Interagency child find systems" means activities 
developed on an interagency basis with the involvement of interagency early 
intervention committees and other relevant community groups to actively seek 
out, identify, and refer infants and young children with, or at risk of, 
disabilities, and their families. 
 (k) "Local primary agency" means the agency designated 
jointly by the school and county board under subdivision 4. 
 (l) "Natural environments" means 
the child's home and community settings in which children without disabilities 
participate. 
 (m) "Parent" means the 
biological parent with parental rights, adoptive parent, legal guardian, or 
surrogate parent. 
 Sec. 2. Minnesota Statutes 1997 Supplement, section 
120.1701, subdivision 3, is amended to read: 
 Subd. 3. [STATE INTERAGENCY COORDINATING COUNCIL.] An 
interagency coordinating council of at least 17, but not more than 25 members is 
established, in compliance with Public Law Number 102-119, section 682. The 
members shall be appointed by the governor. Council members shall elect the 
council chair. The representative of the commissioner of children, families, and 
learning may not serve as the chair. The council shall be composed of at least 
five parents, including persons of color, of children with disabilities under 
age 12, including at least three parents of a child with a disability under age 
seven, five representatives of public or private providers of services for 
children with disabilities under age five, including a special education 
director, county social service director, local Head 
Start director, and a community health services or public health nursing 
administrator, one member of the senate, one member of the house of 
representatives, one representative of teacher preparation programs in early 
childhood-special education or other preparation programs in early childhood 
intervention, at least one representative of advocacy organizations for children 
with disabilities under age five, one physician who cares for young children 
with special health care needs, one representative each from the commissioners 
of commerce, children, families, and learning, health, human services,  The council shall address methods of implementing the 
state policy of developing and implementing comprehensive, coordinated, 
multidisciplinary interagency programs of early intervention services for 
children with disabilities and their families. 
 The duties of the council include recommending policies 
to ensure a comprehensive and coordinated system of all state and local agency 
services for children under age five with disabilities and their families. The 
policies must address how to incorporate each agency's services into a unified 
state and local system of multidisciplinary assessment practices, individual 
intervention plans, comprehensive systems to find children in need of services, 
methods to improve public awareness, and assistance in determining the role of 
interagency early intervention committees. 
 Each year by June 1, the council shall recommend to the 
governor and the commissioners of children, families, and learning, health, 
human services, commerce, and economic security policies for a comprehensive and 
coordinated system. 
 Notwithstanding any other law to the contrary, the state 
interagency coordinating council shall expire on June 30, 2001. 
 Sec. 3. Minnesota Statutes 1996, section 120.1701, 
subdivision 5, is amended to read: 
 Subd. 5. [INTERAGENCY EARLY INTERVENTION COMMITTEES.] (a) 
A school district, group of districts, or special education cooperative, in 
cooperation with the health and human service agencies located in the county or 
counties in which the district or cooperative is located, shall establish an 
interagency early intervention committee for children with disabilities under 
age five and their families under this section, and for 
children with disabilities ages three to 22 consistent with the requirements 
under sections 120.1703 and 120.1705. Committees shall include 
representatives of local and regional health, education, and county human 
service agencies; county boards; school boards; early childhood family education 
programs; parents of young children with disabilities under age 12; current 
service providers; and may also include representatives from other private or 
public agencies and school nurses. The committee 
shall elect a chair from among its members and shall meet at least quarterly. 
 (b) The committee shall develop and implement interagency 
policies and procedures concerning the following ongoing duties: 
 (1) develop public awareness systems designed to inform 
potential recipient families of available programs and services; 
 (2) implement interagency child find systems designed to 
actively seek out, identify, and refer infants and young children with, or at 
risk of, disabilities and their families; 
 (3) establish and evaluate the identification, referral, 
child and family assessment systems, procedural safeguard process, and community 
learning systems to recommend, where necessary, alterations and improvements; 
 (4) assure the development of individualized family 
service plans for all eligible infants and toddlers with disabilities from birth 
through age two, and their families, and individual education plans and 
individual service plans when necessary to appropriately serve children with 
disabilities, age three and older, and their families and recommend assignment 
of financial responsibilities to the appropriate agencies. Agencies are 
encouraged to develop individual family service plans for children with 
disabilities, age three and older; 
 (5) implement a process for assuring that services 
involve cooperating agencies at all steps leading to individualized programs; 
 (6) facilitate the development of a transitional plan if 
a service provider is not recommended to continue to provide services; 
 (7) identify the current services and funding being 
provided within the community for children with disabilities under age five and 
their families; 
 (8) develop a plan for the allocation and expenditure of 
additional state and federal early intervention funds under United States Code, 
title 20, section 1471 et seq. (Part H, Public Law Number 102-119) and United 
States Code, title 20, section 631, et seq. (Chapter I, Public Law Number 
89-313); and 
 (9) develop a policy that is consistent with section 
13.05, subdivision 9, and federal law to enable a member of an interagency early 
intervention committee to allow another member access to data classified as not 
public. 
 (c) The local committee shall also: 
 (1) participate in needs assessments and program planning 
activities conducted by local social service, health and education agencies for 
young children with disabilities and their families; 
 (2) review and comment on the early intervention section 
of the total special education system for the district, the county social 
service plan, the section or sections of the community health services plan that 
address needs of and service activities targeted to children with special health 
care needs, and the section of the maternal and child health special project 
grants that address needs of and service activities targeted to children with 
chronic illness and disabilities; and 
 (3) prepare a yearly summary on the progress of the 
community in serving young children with disabilities, and their families, 
including the expenditure of funds (d) The summary must be organized following a format 
prescribed by the commissioner of the state lead agency and must be submitted to 
each of the local agencies and to the state interagency coordinating council by 
October 1 of each year. 
 The departments of children, families, and learning, 
health, and human services must provide assistance to the local agencies in 
developing cooperative plans for providing services. 
 Sec. 4. Minnesota Statutes 1996, section 120.1701, 
subdivision 11, is amended to read: 
 Subd. 11. [PAYOR OF LAST RESORT.]  Sec. 5. Minnesota Statutes 1996, section 120.1701, 
subdivision 17, is amended to read: 
 Subd. 17. [MEDIATION PROCEDURE.] The commissioner or designee of the state lead agency shall use federal 
funds to provide mediation for the activities in paragraphs (a) and (b). 
 (a) A parent may resolve a dispute regarding issues in 
subdivision 16, paragraph (b), clause (5), through mediation. If the parent 
chooses mediation, all public agencies involved in the dispute shall participate 
in the mediation process. The parent and the public agencies must complete the 
mediation process within 20 calendar days of the date the commissioner receives 
a parent's written request for mediation. The mediation process may not be used 
to delay a parent's right to a due process hearing. The resolution of the 
mediation is not binding on any party. 
 (b) The local primary agency may request mediation on 
behalf of involved agencies when there are disputes between agencies regarding 
responsibilities to coordinate, provide, pay for, or facilitate payment for 
early intervention services. 
 Sec. 6. [120.1703] [COORDINATED INTERAGENCY SERVICES.] 
 Subdivision 1. [CITATION.] Sections 120.1703 and 120.1705 shall be cited as the 
"Interagency Services for Children with Disabilities Act." 
 Subd. 2. [PURPOSE.] It is the policy of the state to develop and implement a 
coordinated, multidisciplinary, interagency intervention service system for 
children ages three to 22 with disabilities. 
 Subd. 3. [DEFINITIONS.] For purposes of sections 120.1703 and 120.1705, the 
following terms have the meanings given them: 
 (a) "Health plan" means: 
 (1) a health plan under section 
62Q.01, subdivision 3; 
 (2) a county-based purchasing plan 
under section 256B.692; 
 (3) a self-insured health plan 
established by a local government under section 471.617; or 
 (4) self-insured health coverage 
provided by the state to its employees or retirees. 
 (b) For purposes of this section, 
"health plan company" means an entity that issues a health plan as defined in 
paragraph (a). 
 (c) "Individual interagency 
intervention plan" means a standardized written plan describing those programs 
or services and the accompanying funding sources available to eligible children 
with disabilities. 
 (d) "Interagency intervention 
service system" means a system that coordinates services and programs required 
in state and federal law to meet the needs of eligible children with 
disabilities ages three to 22, including: 
 (1) services provided under the 
following programs or initiatives administered by state or local agencies: 
 (i) the maternal and child health 
program under title V of the Social Security Act, United States Code, title 42, 
sections 701 to 709; 
 (ii) the Individuals with 
Disabilities Education Act under United States Code, title 20, chapter 33, 
subchapter II, sections 1411 to 1420; 
 (iii) medical assistance under the 
Social Security Act, United States Code, title 42, chapter 7, subchapter XIX, 
section 1396, et seq.; 
 (iv) the Developmental 
Disabilities Assistance and Bill of Rights Act, United States Code, title 42, 
chapter 75, subchapter II, sections 6021 to 6030, Part B; 
 (v) the Head Start Act, United 
States Code, title 42, chapter 105, subchapter II, sections 9831 to 9852; 
 (vi) rehabilitation services 
provided under chapter 268A; 
 (vii) juvenile court act services 
provided under sections 260.011 to 260.301; 
 (viii) the children's mental 
health collaboratives under section 245.493; 
 (ix) the family service 
collaboratives under section 121.8355; 
 (x) the family community support 
plan under section 245.4881, subdivision 4; 
 (xi) the Minnesota care program 
under chapter 256L; 
 (xii) the community health 
services grants under chapter 145; 
 (xiii) the community social 
services act funding under the Social Security Act, United States Code, title 
42, sections 1397 to 1397f; and 
 (xiv) the community interagency 
transition committees under section 120.17, subdivision 16; 
 (2) services provided under a 
health plan in conformity with an individual family service plan or an 
individual education plan; and 
 (3) additional appropriate 
services that local agencies and counties provide on an individual need basis 
upon determining eligibility and receiving a request from the interagency early 
intervention committee and the child's parent. 
 (e) "Children with disabilities" 
has the meaning given in section 120.03. 
 (f) A "standardized written plan" 
means those individual services or programs available through the interagency 
intervention service system to an eligible child other than the services or 
programs described in the child's individual education plan or the child's 
individual family service plan. 
 Subd. 4. [STATE INTERAGENCY 
COMMITTEE.] (a) The governor shall convene by July 1, 
1998, an 18-member interagency committee to develop and implement a coordinated, 
multidisciplinary, interagency intervention service system for children with 
disabilities ages three to 22. The commissioners of commerce, children, 
families, and learning, health, human rights, human services, economic security, 
and corrections shall each appoint two committee members from their departments; 
the association of Minnesota counties shall appoint two county representatives, 
one of whom shall be an elected official, as committee members; and the 
Minnesota school boards association and the school nurse association of 
Minnesota shall each appoint one committee member. The committee shall select a 
chair from among its members. The committee shall meet at least monthly. 
 (b) The committee shall: 
 (1) identify and assist in 
removing state and federal barriers to local coordination of services provided 
to children with disabilities; 
 (2) ensure adequate, equitable, 
and flexible funding sources to streamline these services; 
 (3) develop guidelines for 
implementing policies that ensure a comprehensive and coordinated system of all 
state and local agency services, including multidisciplinary assessment 
practices for children with disabilities ages three to 22; 
 (4) develop, consistent with 
federal law, a standardized written plan for providing services to a child with 
disabilities; 
 (5) identify how current systems 
for dispute resolution can be coordinated and develop guidelines for that 
coordination; 
 (6) develop an evaluation process 
to measure the success of state and local interagency efforts in improving the 
quality and coordination of services to children with disabilities ages three to 
22; 
 (7) develop guidelines to assist 
the governing boards of the interagency early intervention committees in 
carrying out the duties assigned in section 120.1705, subdivision 1, paragraph 
(b); and 
 (8) carry out other duties 
necessary to develop and implement within communities a coordinated, 
multidisciplinary, interagency intervention service system for children with 
disabilities. 
 (c) The committee shall consult on 
an ongoing basis with the state education advisory committee for special 
education and the governor's interagency coordinating council in carrying out 
its duties under this section, including assisting the governing boards of the 
interagency early intervention committees. 
 Subd. 5. [INTERVENTION 
DEMONSTRATION PROJECTS.] (a) The state interagency 
committee shall issue a request for proposals by January 1, 1999, to provide 
grants to the governing boards of interagency intervention committees under 
section 120.1705 or a combination of one or more counties and school districts 
to establish five voluntary interagency intervention demonstration projects. One 
grant shall be used to implement a coordinated service system for all eligible 
children with disabilities up to age five who received services under section 
120.1701. Each project must be operational by July 1, 1999. The governing boards 
of the interagency early intervention committees and the counties and school 
districts receiving project grants must develop efficient ways to coordinate 
services and funding for children with disabilities ages three to 22, consistent 
with the requirements of this section and section 120.1705 and the guidelines 
developed by the state interagency committee under this section. 
 (b) The state interagency 
committee shall evaluate the demonstration projects and provide the evaluation 
results to interagency early intervention committees. 
 Subd. 6. [THIRD-PARTY 
LIABILITY.] Nothing in this section and section 120.1705 
relieves a health plan company, third-party administrator or other third-party 
payer of an obligation to pay for, or changes the validity of an obligation to 
pay for, services provided to children with disabilities ages three to 22 and 
their families. 
 Subd. 7. [AGENCY OBLIGATION.] 
Nothing in this section and section 120.1705 removes the 
obligation of the state, counties, local school districts, a regional agency, or 
a local agency or organization to comply with any federal or state law that 
mandates responsibility for finding, assessing, delivering, assuring, or paying 
for education or related services for children with disabilities and their 
families. 
 Sec. 7. [120.1705] [INTERAGENCY EARLY INTERVENTION 
COMMITTEE RESPONSIBILITIES.] 
 Subdivision 1. [ADDITIONAL 
DUTIES.] (a) The governing boards of the interagency 
early intervention committees are responsible for developing and implementing 
interagency policies and procedures to coordinate services at the local level 
for children with disabilities ages three to 22 under guidelines established by 
the state interagency committee under section 120.1703, subdivision 4. 
Consistent with the requirements in this section and section 120.1703, the 
governing boards of the interagency early intervention committees shall organize 
as a joint powers board under section 471.59 or enter into an interagency 
agreement that establishes a governance structure. 
 (b) The governing board of each 
interagency early intervention committee as defined in section 120.1701, 
subdivision 5, paragraph (a), which may include a juvenile justice professional, 
shall: 
 (1) identify and assist in 
removing state and federal barriers to local coordination of services provided 
to children with disabilities; 
 (2) ensure adequate, equitable, 
and flexible use of funding by local agencies for these services; 
 (3) implement policies that ensure 
a comprehensive and coordinated system of all state and local agency services, 
including multidisciplinary assessment practices, for children with disabilities 
ages three to 22; 
 (4) use a standardized written 
plan for providing services to a child with disabilities developed under section 
120.1703; 
 (5) access the coordinated dispute 
resolution system and incorporate the guidelines for coordinating services at 
the local level, consistent with section 120.1703; 
 (6) use the evaluation process to 
measure the success of the local interagency effort in improving the quality and 
coordination of services to children with disabilities ages three to 22 
consistent with section 120.1703; 
 (7) develop a transitional plan 
for children moving from the interagency early childhood intervention system 
under section 120.1701 into the interagency intervention service system under 
this section; 
 (8) coordinate services and 
facilitate payment for services from public and private institutions, agencies, 
and health plan companies; and 
 (9) share needed information 
consistent with state and federal data practices requirements. 
 Subd. 2. [SERVICES.] (a) Consistent with their training and experience, 
physicians, other health care professionals including school nurses, and 
education and human services providers jointly must, with full participation of 
parents, determine appropriate and medically necessary services for eligible 
children with disabilities ages three to 22. The services provided to the child 
under this section must conform with the child's standardized written plan. The 
governing board of an interagency early intervention committee must provide 
those services contained in a child's individual education plan and those 
services for which a legal obligation exists to the extent funding is 
available. 
 (b) Nothing in this section and 
section 120.1703 increases or decreases the obligation of the state, county, 
regional agency, local school district, or local agency or organization to pay 
for education, health care, or social services. 
 (c) A health plan may not exclude 
any medically necessary covered service solely because the service is or could 
be identified in a child's individual family service plan, individual education 
plan, a plan established under section 504 of the federal Rehabilitation Act of 
1973, or a student's individual health plan. This paragraph reaffirms the 
obligation of a health plan company to provide or pay for certain medically 
necessary covered services, and encourages a health plan company 
 to coordinate this care with any other providers of 
similar services. Also, a health plan company may not exclude from a health plan 
any medically necessary covered service such as an assessment or physical 
examination solely because the resulting information may be used for an 
individual education plan or a standardized written plan. Subd. 3. [IMPLEMENTATION 
TIMELINE.] (a) By July 1, 2000, all governing boards of 
interagency early intervention committees statewide must implement a coordinated 
service system for children with disabilities up to age five consistent with the 
requirements of this section and section 120.1703 and the evaluation results 
from the demonstration projects under section 120.1703, subdivision 5. Children 
with disabilities up to the age of 22 shall be eligible for coordinated services 
and their eligibility to receive such services under this section shall be 
phased in over a four-year period as follows: 
 (1) July 1, 2001, children up to 
age nine become eligible; 
 (2) July 1, 2002, children up to 
age 14 become eligible; 
 (3) July 1, 2003, children up to 
age 18 become eligible; and 
 (4) July 1, 2004, children up to 
age 22 become eligible. 
 Sec. 8. Minnesota Statutes 1997 Supplement, section 
126.79, subdivision 3, is amended to read: 
 Subd. 3. [LOCAL PROGRAMS; APPLICATION PROCEDURE; GRANT 
AWARDS.] The commissioner shall make grants to eligible applicants to establish 
local learn and earn programs. Each program shall operate for at least a 
four-year period. A local program shall select its participants from among 
eligible students who are entering or are in the ninth grade at the inception of 
the program. A program may not refill a program slot with another student if a 
student drops out of the program. Students selected to participate in the 
program shall be considered part of the program class and students who drop out 
may return to the program at any time prior to graduation. 
 The commissioner shall establish the application 
procedure for awarding grants under this section. The commissioner shall begin 
awarding grants by  Sec. 9. Minnesota Statutes 1997 Supplement, section 
126.79, subdivision 6, is amended to read: 
 Subd. 6. [PROGRAM COMPONENTS.] Each learn and earn 
graduation achievement program must provide the opportunity for participating 
students to complete: 
 (1) 250 hours each year, not including regular required 
classroom hours, in basic education competency skills; 
 (2) 250 hours each year of service 
to the community  (3) 250 hours each year of cultural enrichment and 
personal development, including but not limited to adult mentoring; 
participating in community cultural events; developing life skills for use in 
the home, workplace, and community; and learning to set goals, manage time, and 
make appropriate behavior choices for varying social situations. 
 Sec. 10. Minnesota Statutes 1997 Supplement, section 
126.79, subdivision 7, is amended to read: 
 Subd. 7. [PROGRAM INCENTIVES.] (a) Each participating 
student shall receive a monetary stipend for each hour spent in a program 
component activity, plus a bonus upon completion of each component during each 
year of the program. 
 (b) An additional amount equal to or greater than each 
student's earned stipends and bonuses must be deposited for the student in a 
post-secondary opportunities  The commissioner shall establish a procedure for 
providing the monetary stipends and bonuses to students. The commissioner may 
delegate this authority to grantees. 
 Sec. 11. Minnesota Statutes 1997 Supplement, section 
126.79, subdivision 8, is amended to read: 
 Subd. 8. [PROGRAM COORDINATOR.] The local learn and earn 
program coordinator must maintain contact with all participating students and 
their families; work with the school to link students with the resources needed 
to improve their educational skills; arrange for service 
to the community  Sec. 12. Minnesota Statutes 1997 Supplement, section 
126.79, subdivision 9, is amended to read: 
 Subd. 9. [EVALUATION AND REPORTS.] The commissioner shall 
collect information about participating students and a demographically similar 
control group and shall evaluate the short-term and long-term benefits 
participating students receive from the learn and earn graduation achievement 
program, based on the outcome measures specified in subdivision 2, and any other 
criteria established by the commissioner as part of the grant application 
process. The evaluation must include a statistical comparison of students 
participating in the program and the control group. The commissioner shall  Sec. 13. Laws 1997, First Special Session chapter 4, 
article 3, section 23, is amended by adding a subdivision to read: 
 Subd. 4a. [PLANNING AND DESIGN 
GRANT.] (a) An eligible lifework learning site applicant 
may apply for a one-time grant to plan and design a lifework learning facility. 
The planning and design grant shall not exceed $200,000 for a site. 
 (b) A planning and design grant 
recipient shall report to the commissioner of children, families, and learning 
on the planning and design of the lifework learning facility and the ability to 
start up the site and maintain the facility. 
 Sec. 14. Laws 1997, First Special Session chapter 4, 
article 3, section 25, subdivision 2, is amended to read: 
 Subd. 2. [SECONDARY VOCATIONAL EDUCATION AID.] For 
secondary vocational education aid according to Minnesota Statutes, section 
124.573: 
 The 1998 appropriation includes $1,180,000 for 1997 and 
 The 1999 appropriation includes  Sec. 15. Laws 1997 First Special Session, chapter 4, 
article 3, section 25, subdivision 4, is amended to read: 
 Subd. 4. [EDUCATION AND EMPLOYMENT TRANSITIONS PROGRAM 
GRANTS.] For education and employment transitions program: 
 $4,750,000 . . . . . 1998 
 $4,750,000 . . . . . 1999 
 $500,000 each year is for development of MnCEPs, an 
Internet-based education and employment information system. These are one-time 
funds. 
 $1,225,000 in fiscal year 1998 and $1,250,000 in fiscal 
year 1999 is for a rebate program for qualifying employers who employ less than 
250 employees, who offer youth internships to educators. An employer may apply 
for a rebate of up to $500 for each paid youth internship and each educator 
internship, and up to $3,000 for each paid youth apprenticeship. The 
commissioner shall determine the application and payment process. 
 $450,000 each year is for youth apprenticeship program 
grants. 
 $225,000 each year is for youth entrepreneurship grants 
under Minnesota Statutes, section 121.72. Of this amount, $25,000 each year is 
for the high school student entrepreneurship program in independent school 
district No. 175, Westbrook. This appropriation shall be used for expenses, 
including, but not limited to, salaries, travel, seminars, equipment purchases, 
contractual expenses, and other expenses related to the student-run business. 
 $125,000 each year is for youth employer grants under 
Laws 1995, First Special Session chapter 3, article 4, section 28. 
 $150,000 each year is for parent and community awareness 
training. 
 $825,000 each year is for the development of career 
assessment benchmarks, lifework portfolios, industry skill standards, curriculum 
development, career academies, and career programs for elementary, middle 
school, and at-risk learners. 
 $400,000 each year is for state level activities, 
including the governor's workforce council. 
 $275,000 each year is for development of occupational 
information. 
 $300,000 each year is for a grant to be made available to 
a county government that has established school-to-work projects with schools 
located in a city of the first class. These grants must be used to expand the 
number of at-risk students participating in these school-to-work projects. 
Priority must be given to projects that demonstrate collaboration between 
private employers, collective bargaining representatives, school officials, and 
the county government and which prepare at-risk students for long-term 
employment with private sector employers paying a minimum of 150 percent of the 
federal poverty level for a family of four and with the majority of their 
employees in collective bargaining units. 
 $250,000 each year is for agricultural school-to-work 
grants. 
 $25,000 is for a grant to the Minnesota Historical 
Society for money canceled in fiscal year 1997. 
 Any balance remaining in the first 
year does not cancel but is available in the second year. 
 Sec. 16. [APPROPRIATIONS.] 
 Subdivision 1. [DEPARTMENT OF 
CHILDREN, FAMILIES, AND LEARNING.] The sums indicated in 
this section are appropriated from the general fund to the department of 
children, families, and learning for the fiscal years designated. 
 Subd. 2. [INTERVENTION 
DEMONSTRATION PROJECTS.] For establishing five voluntary 
interagency intervention demonstration projects under section 6, subdivision 
5: 
 $ 250,000 . . . . . 1999 
 The commissioner shall allocate 
the grant awards according to the implementation needs of the grant 
recipients. 
 Subd. 3. [PLANNING AND DESIGN 
GRANT.] For one-time grants to plan and design a lifework 
learning facility under section 13: 
 $ 450,000 . . . . . 1999 
 Sec. 17. [REPEALER.] 
 Laws 1993, chapter 146, article 5, 
section 20, as amended by Laws 1997, First Special Session chapter 4, article 3, 
section 20, is repealed. 
 Sec. 18. [EFFECTIVE DATE.] 
 Sections 6, 8, 10, 13, 14, and 15 
are effective the day following final enactment. 
 
 
 Section 1. Minnesota Statutes 1996, section 122.23, 
subdivision 6, is amended to read: 
 Subd. 6. The commissioner shall, upon receipt of a plat, 
forthwith examine it and approve, modify or reject it. The commissioner shall 
also approve or reject any proposal contained in the resolution or petition 
regarding the disposition of the bonded debt of the component districts. If the 
plat shows the boundaries of proposed separate election districts and if the 
commissioner modifies the plat, the commissioner shall also modify the 
boundaries of the proposed separate election districts. The commissioner shall 
conduct a  Sec. 2. Minnesota Statutes 1996, section 123.35, 
subdivision 19a, is amended to read: 
 Subd. 19a. [LIMITATION ON PARTICIPATION AND FINANCIAL 
SUPPORT.] (a) No school district shall be required by any type of formal or 
informal agreement except an agreement to provide building space according to 
paragraph (f), including a joint powers agreement, or membership in any 
cooperative unit defined in subdivision 19b, paragraph (d), to participate in or 
provide financial support for the purposes of the agreement for a time period in 
excess of  (b) This subdivision shall not affect the continued 
liability of a school district for its share of bonded indebtedness or other 
debt incurred as a result of any agreement before July 1, 1993. The school 
district is liable only until the obligation or debt is discharged and only 
according to the payment schedule in effect on July 1, 1993, except that the 
payment schedule may be altered for the purpose of restructuring debt or 
refunding bonds outstanding on July 1, 1993, if the annual payments of the 
school district are not increased and if the total obligation of the school 
district for its share of outstanding bonds or other debt is not increased. 
 (c) To cease participating in or providing financial 
support for any of the services or activities relating to the agreement or to 
terminate participation in the agreement, the school board shall adopt a 
resolution and notify other parties to the agreement of its decision on or 
before February 1 of any year. The cessation or withdrawal shall be effective 
June 30 of the same year except that for a member of an education district 
organized under sections 122.91 to 122.95 or an intermediate district organized 
under chapter 136D, cessation or withdrawal shall be effective June 30 of the 
following fiscal year. At the option of the school board, cessation or 
withdrawal may be effective June 30 of the following fiscal year for a district 
participating in any type of agreement. 
 (d) Before issuing bonds or incurring other debt, the 
governing body responsible for implementing the agreement shall adopt a 
resolution proposing to issue bonds or incur other debt and the proposed 
financial effect of the bonds or other debt upon each participating district. 
The resolution shall be adopted within a time sufficient to allow the school 
board to adopt a resolution within the time permitted by this paragraph and to 
comply with the statutory deadlines set forth in sections 122.895, 125.12, and 
125.17. The governing body responsible for implementing the agreement shall 
notify each participating school board of the contents of the resolution. Within 
120 days of receiving the resolution of the governing body, the school board of 
the participating district shall adopt a resolution stating: 
 (1) its concurrence with issuing bonds or incurring other 
debt; 
 (2) its intention to cease participating in or providing 
financial support for the service or activity related to the bonds or other 
debt; or 
 (3) its intention to terminate participation in the 
agreement. 
 A school board adopting a resolution according to clause 
(1) is liable for its share of bonded indebtedness or other debt as proposed by 
the governing body implementing the agreement. A school board adopting a 
resolution according to clause (2) is not liable for the bonded indebtedness or 
other debt, as proposed by the governing body, related to the services or 
activities in which the district ceases participating or providing financial 
support. A school board adopting a resolution according to clause (3) is not 
liable for the bonded indebtedness or other debt proposed by the governing body 
implementing the agreement. 
 (e) After July 1, 1993, a district is liable according to 
paragraph (d) for its share of bonded indebtedness or other debt incurred by the 
governing body implementing the agreement to the extent that the bonds or other 
debt are directly related to the services or activities in which the district 
participates or for which the district provides financial support. The district 
has continued liability only until the obligation or debt is discharged and only 
according to the payment schedule in effect at the time the governing body 
implementing the agreement provides notice to the school board, except that the 
payment schedule may be altered for the purpose of refunding the outstanding 
bonds or restructuring other debt if the annual payments of the district are not 
increased and if the total obligation of the district for the outstanding bonds 
or other debt is not increased. 
 (f) A school district that is a member of a cooperative 
unit as defined in subdivision 19b, paragraph (d), may obligate itself to 
participate in and provide financial support for an agreement with a cooperative 
unit to provide school building space for a term not to exceed two years with an 
option on the part of the district to renew for an additional two years. 
 (g) Notwithstanding any 
limitations imposed under this subdivision, a school district may, according to 
section 123.36, subdivision 10, enter into a lease of all or a portion of a 
schoolhouse that is not needed for school purposes, including, but not limited 
to, a lease with a term of more than one year. 
 Sec. 3. Minnesota Statutes 1996, section 124.273, is 
amended by adding a subdivision to read: 
 Subd. 8. [ALLOCATIONS FROM 
COOPERATIVE UNITS.] For the purposes of this section and 
section 124.321, pupils of limited English proficiency enrolled in a cooperative 
or intermediate school district unit shall be counted by the school district of 
residence, and the cooperative unit shall allocate its approved expenditures for 
limited English proficiency programs among participating school districts. 
Limited English proficiency aid for services provided by a cooperative or 
intermediate school district shall be paid to the participating school 
districts. 
 Sec. 4. Minnesota Statutes 1996, section 124.755, 
subdivision 1, is amended to read: 
 Subdivision 1. [DEFINITIONS.] For the purposes of this 
section, the term "debt obligation" means  (1) a tax or aid anticipation 
certificate of indebtedness; 
 (2) a certificate of participation 
issued under section 124.91, subdivision 7; or 
 (3) a general obligation bond. 
 Sec. 5. Minnesota Statutes 1997 Supplement, section 
124.91, subdivision 1, is amended to read: 
 Subdivision 1. [TO LEASE BUILDING OR LAND.] (a) When a 
district finds it economically advantageous to rent or lease a building or land 
for any instructional purposes or for school storage or furniture repair, and it 
determines that the operating capital revenue authorized under section 124A.22, 
subdivision 10, is insufficient for this purpose, it may apply to the 
commissioner for permission to make an additional capital expenditure levy for 
this purpose. An application for permission to levy under this subdivision must 
contain financial justification for the proposed levy, the terms and conditions 
of the proposed lease, and a description of the space to be leased and its 
proposed use. 
 (b) The criteria for approval of applications to levy 
under this subdivision must include: the reasonableness of the price, the 
appropriateness of the space to the proposed activity, the feasibility of 
transporting pupils to the leased building or land, conformity of the lease to 
the laws and rules of the state of Minnesota, and the appropriateness of the 
proposed lease to the space needs and the financial condition of the district. 
The commissioner must not authorize a levy under this subdivision in an amount 
greater than the cost to the district of renting or leasing a building or land 
for approved purposes. The proceeds of this levy must not be used for custodial 
or other maintenance services. A district may not levy under this subdivision 
for the purpose of leasing or renting a district-owned building or site to itself. 
 (c) For agreements finalized after July 1, 1997, a 
district may not levy under this subdivision for the purpose of leasing: (1) a 
newly constructed building used primarily for regular kindergarten, elementary, 
or secondary instruction; or (2) a newly constructed building addition or 
additions used primarily for regular kindergarten, elementary, or secondary 
instruction that contains more than 20 percent of the square footage of the 
previously existing building. 
 (d) The total levy under this subdivision for a district 
for any year must not exceed $100 times the actual pupil units for the fiscal 
year to which the levy is attributable. 
 (e) For agreements finalized after 
April 1, 1998, the term "instructional purpose" as used in this subdivision 
excludes expenditures on stadiums. 
 Sec. 6. Minnesota Statutes 1997 Supplement, section 
124.91, subdivision 5, is amended to read: 
 Subd. 5. [INTERACTIVE TELEVISION.] (a) A school district 
with its central administrative office located within economic development 
region one, two, three, four, five, six, seven, eight, nine, and ten may apply 
to the commissioner of children, families, and learning for ITV revenue up to 
the greater of .5 percent of the adjusted net tax capacity of the district or 
$25,000. Eligible interactive television expenditures include the construction, 
maintenance, and lease costs of an interactive television system for 
instructional purposes. An eligible school district that has completed the 
construction of its interactive television system may also purchase computer 
hardware and software used primarily for instructional purposes and access to 
the Internet provided that its total expenditures for interactive television 
maintenance and lease costs and for computer hardware and software under this 
subdivision do not exceed its interactive television revenue for fiscal year 
1998. The approval by the commissioner of children, families, and learning and 
the application procedures set forth in subdivision 1 shall apply to the revenue 
in this subdivision. In granting the approval, the commissioner must consider 
whether the district is maximizing efficiency through peak use and off-peak use 
pricing structures. 
 (b) To obtain ITV revenue, a district may levy an amount 
not to exceed the district's ITV revenue times the lesser of one or the ratio 
of: 
 (1) the quotient derived by dividing the adjusted net tax 
capacity of the district for the year before the year the levy is certified by 
the actual pupil units in the district for the year to which the levy is 
attributable; to 
 (2)  (c) A district's ITV aid is the difference between its 
ITV revenue and the ITV levy. 
 (d) The revenue in the first year after reorganization 
for a district that has reorganized under section 122.22, 122.23, or 122.241 to 
122.247 shall be the greater of: 
 (1) the revenue computed for the reorganized district 
under paragraph (a), or 
 (2)(i) for two districts that reorganized, 75 percent of 
the revenue computed as if the districts involved in the reorganization were 
separate, or 
 (ii) for three or more districts that reorganized, 50 
percent of the revenue computed as if the districts involved in the 
reorganization were separate. 
 (e) The revenue in paragraph (d) is increased by the 
difference between the initial revenue and ITV lease costs for leases that had 
been entered into by the preexisting districts on the effective date of the 
consolidation or combination and with a term not exceeding ten years. This 
increased revenue is only available for the remaining term of the lease. 
However, in no case shall the revenue exceed the amount available had the 
preexisting districts received revenue separately. 
 (f) Effective for fiscal year 2000, the revenue under 
this section shall be 75 percent of the amount determined in paragraph (a); for 
fiscal year 2001, 50 percent of the amount in paragraph (a); and for fiscal year 
2002, 25 percent of the amount in paragraph (a). 
 (g) This section expires effective for revenue for fiscal 
year 2003, or when leases in existence on the effective date of Laws 1997, First 
Special Session chapter 4, expire. 
 Sec. 7. Minnesota Statutes 1996, section 124.95, 
subdivision 6, is amended to read: 
 Subd. 6. [DEBT SERVICE EQUALIZATION AID PAYMENT 
SCHEDULE.] Debt service equalization aid must be paid as follows: 30 percent 
before September 15, 30 percent before December 15,  Sec. 8. Minnesota Statutes 1997 Supplement, section 
124A.22, subdivision 11, is amended to read: 
 Subd. 11. [USES OF TOTAL OPERATING CAPITAL REVENUE.] 
Total operating capital revenue may be used only for the following purposes: 
 (1) to acquire land for school purposes; 
 (2) to acquire or construct buildings for school 
purposes (3) to rent or lease buildings, including the costs of 
building repair or improvement that are part of a lease agreement; 
 (4) to improve and repair school sites and buildings, and 
equip or reequip school buildings with permanent attached fixtures; 
 (5) for a surplus school building that is used 
substantially for a public nonschool purpose; 
 (6) to eliminate barriers or increase access to school 
buildings by individuals with a disability; 
 (7) to bring school buildings into compliance with the 
uniform fire code adopted according to chapter 299F; 
 (8) to remove asbestos from school buildings, encapsulate 
asbestos, or make asbestos-related repairs; 
 (9) to clean up and dispose of polychlorinated biphenyls 
found in school buildings; 
 (10) to clean up, remove, dispose of, and make repairs 
related to storing heating fuel or transportation fuels such as alcohol, 
gasoline, fuel oil, and special fuel, as defined in section 296.01; 
 (11) for energy audits for school buildings and to modify 
buildings if the audit indicates the cost of the modification can be recovered 
within ten years; 
 (12) to improve buildings that are leased according to 
section 123.36, subdivision 10; 
 (13) to pay special assessments levied against school 
property but not to pay assessments for service charges; 
 (14) to pay principal and interest on state loans for 
energy conservation according to section 216C.37 or loans made under the 
Northeast Minnesota Economic Protection Trust Fund Act according to sections 
298.292 to 298.298; 
 (15) to purchase or lease interactive telecommunications 
equipment; 
 (16) by school board resolution, to transfer money into 
the debt redemption fund to: (i) pay the amounts needed to meet, when due, 
principal and interest payments on certain obligations issued according to 
chapter 475; or (ii) pay principal and interest on debt service loans or capital 
loans according to section 124.44; 
 (17) to pay capital expenditure equipment-related 
assessments of any entity formed under a cooperative agreement between two or 
more districts; 
 (18) to purchase or lease computers and related 
materials, copying machines, telecommunications equipment, and other 
noninstructional equipment; 
 (19) to purchase or lease assistive technology or 
equipment for instructional programs; 
 (20) to purchase textbooks; 
 (21) to purchase new and replacement library books; 
 (22) to purchase vehicles; 
 (23) to purchase or lease telecommunications equipment, 
computers, and related equipment for integrated information management systems 
for: 
 (i) managing and reporting learner outcome information 
for all students under a results-oriented graduation rule; 
 (ii) managing student assessment, services, and 
achievement information required for students with individual education plans; 
and 
 (iii) other classroom information management needs; and 
 (24) to pay personnel costs directly related to the 
acquisition, operation, and maintenance of telecommunications systems, 
computers, related equipment, and network and applications software. 
 Sec. 9. Laws 1997, First Special Session chapter 4, 
article 4, section 35, subdivision 9, is amended to read: 
 Subd. 9. [FLOOD LOSSES.] For grants and loans to 
independent school district Nos. 2854, Ada-Borup; 2176, Warren-Alvarado-Oslo; 
846, Breckenridge; 595, East Grand Forks; and other districts affected by the 
1997 floods for expenses associated with the floods not covered by insurance or 
state or federal disaster relief: 
 $4,700,000 . . . . . 1998 
 The commissioner shall award grants and loans to school 
districts to cover expenses associated with the 1997 floods. The grants or loans 
may be for capital losses or for extraordinary operating expenses resulting from 
the floods. School districts shall repay any loan or grant amounts to the 
department if those amounts are otherwise funded from other sources. The 
commissioner shall establish the terms and conditions of any loans and may 
request any necessary information from school districts before awarding a grant 
or loan. This appropriation shall also be used to fund aid under sections 33 and 
34. 
 This appropriation is available 
until June 30, 1999. 
 Sec. 10. Laws 1997, First Special Session chapter 4, 
article 9, section 12, subdivision 8, is amended to read: 
 Subd. 8. [INTERACTIVE TELEVISION (ITV) AID.] For 
interactive television (ITV) aid under Minnesota Statutes, section 124.91, 
subdivision 5: 
 The 1998 appropriation includes $384,000 for 1997 and  The 1999 appropriation includes  Sec. 11. [ENHANCED PAIRING COOPERATION AND COMBINATION 
AID.] 
 Subdivision 1. [DISTRICT 
ELIGIBILITY.] A group of districts participating in an 
enhanced pairing agreement under Laws 1995, First Special Session chapter 3, 
article 6, section 17, is eligible for a grant for cooperation and 
combination. 
 Subd. 2. [AID AMOUNT.] A district that is participating in an enhanced pairing 
agreement is eligible for consolidation transition revenue under Minnesota 
Statutes, section 124.2726 and is also eligible for additional state aid equal 
to $100 times the number of pupil units enrolled in an enhanced paired district 
in the year prior to consolidation. 
 Subd. 3. [AID USES.] A district receiving aid under this section must use the aid 
consistent with the purposes listed under Minnesota Statutes, section 124.2725, 
subdivision 11, or other purposes related to combination of the individual 
districts as determined by the school board. If, after receipt of state aid 
under this section the districts choose not to combine and receive aid under 
Minnesota Statutes, section 124.2726, the commissioner of children, families, 
and learning must recover aid equal to $25 times the number of pupil units in 
the enhanced paired district. 
 Sec. 12. [LEASE LEVY FOR ADMINISTRATIVE SPACE; SOUTH ST. 
PAUL AND MANKATO.] 
 Each year, special school district 
No. 6, South St. Paul, and independent school district No. 77, Mankato, may levy 
the amounts necessary to rent or lease administrative space so that space 
previously used for administrative purposes may be used for instructional 
purposes. 
 Sec. 13. [BONDING AUTHORIZATION.] 
 To provide funds for the 
acquisition or betterment of school facilities, independent school district No. 
625, St. Paul, may by two-thirds majority vote of all the members of the board 
of directors issue general obligation bonds in one or more series in calendar 
years 1998 to 2002, both inclusive, as provided in this section. The aggregate 
principal amount of any bonds issued under this section for each calendar year 
must not exceed $15,000,000. Issuance of the bonds is not subject to Minnesota 
Statutes, section 475.58 or 475.59. The bonds must otherwise be issued as 
provided in Minnesota Statutes, chapter 475. The authority to issue bonds under 
this section is in addition to any bonding authority authorized by Minnesota 
Statutes, chapter 124, or other law. The amount of bonding authority authorized 
under this section must be disregarded in calculating the bonding limit of 
Minnesota Statutes, chapter 124, or any other law other than Minnesota Statutes, 
section 475.53, subdivision 4. 
 Sec. 14. [TAX LEVY FOR DEBT SERVICE.] 
 To pay the principal of and 
interest on bonds issued under section 13, independent school district No. 625, 
St. Paul, must levy a tax annually in an amount sufficient under Minnesota 
Statutes, section 475.61, subdivisions 1 and 3, to pay the principal of and 
interest on the bonds. The tax authorized under this section is in addition to 
the taxes authorized to be levied under Minnesota Statutes, chapter 124A or 275, 
or other law. 
 Sec. 15. [LEVY MODIFICATION.] 
 Independent school district No. 
625, St. Paul, shall submit a revised schedule for capital expenditure health 
and safety projects to the commissioner of children, families, and learning. The 
schedule must show a decrease in the district's health and safety revenue 
projects commensurate with the increase in its debt service levy attributable to 
the enactment of sections 13 and 14 for taxes payable in 1999 and taxes payable 
in 2000. 
 Sec. 16. [MODEL TECHNOLOGY PROGRAM.] 
 Subdivision 1. [PROGRAM.] A school district may develop a model technology program. 
The program must provide for a systematic implementation of the district's 
technology plan. The plan must include a schedule of hardware and software 
purchases as well as provide for the technical support and staff development 
necessary to fully utilize the technology. 
 Subd. 2. [EQUIPMENT LEASING.] 
Notwithstanding any other law to the contrary, a school 
district may enter into an arrangement to lease hardware and software for a 
period of time mutually agreed upon by the school board and the contractor. 
 Sec. 17. [APPROPRIATION.] 
 Subdivision 1. [DEPARTMENT OF 
CHILDREN, FAMILIES, AND LEARNING.] The sums indicated in 
this section are appropriated from the general fund to the department of 
children, families, and learning for the fiscal years designated. 
 Subd. 2. [CROW RIVER AND 
MEEKER AND WRIGHT SPECIAL EDUCATION COOPERATIVES.] For a 
grant to special education cooperatives No. 52-937, Crow River, and No. 52-938, 
Meeker and Wright, for disability access improvements to conform to the 
Americans with Disabilities Act and for code compliance in school building space 
for the students served by the cooperatives: 
 $ 100,000 . . . . . 1999 
 Subd. 3. [CARLTON PLANNING 
GRANT.] For a grant to independent school district No. 
93, Carlton, to develop a plan to coordinate district buildings and 
services: 
 $ 10,000 . . . . . 1999 
 The school district shall 
collaborate with the city of Carlton and Carlton county in developing the 
plan. 
 Subd. 4. [CALEDONIA PLANNING 
GRANT.] (a) For a grant to perform a management 
assistance study for independent school district No. 299, Caledonia: 
 $ 40,000 . . . . . 1999 
 (b) The study shall include an 
analysis of facility needs, enrollment trends, and instructional opportunities 
available to pupils of independent school district No. 299, Caledonia. The 
department may consult with neighboring school districts, as appropriate. The 
department shall complete the management assistance study by December 31, 
1998. 
 (c) This appropriation is 
available until June 30, 1999. 
 Subd. 5. [COORDINATED 
FACILITIES PLAN; MAPLE RIVER.] For a grant to independent 
school district No.2135, Maple River: 
 $ 200,000 . . . . . 1999 
 The grant shall be used to examine 
and coordinate the district's building needs. The district must evaluate how the 
current use of its facilities is affecting its educational services and examine 
cost efficiencies that may result from a coordinated facilities plan. The grant 
may be used for operating purposes, transportation purposes, or facilities 
purposes that lead to greater program efficiencies. 
 Subd. 6. [ENHANCED PAIRING 
COMBINATION AID.] For a grant to a group of school 
districts participating in the enhanced pairing program that intend to combine 
into a single school district: 
 $ 135,000 . . . . . 1999 
 Sec. 18. [EFFECTIVE DATE.] 
 (a) Sections 1, 2, 3, and 12 are 
effective July 1, 1998. 
 (b) Section 4 is effective 
retroactively for revenue for fiscal year 1997. 
 (c) Section 6 is effective for 
revenue for fiscal year 1999. 
 (d) Section 7 is effective for 
revenue for fiscal year 1998. 
 (e) Sections 8, 9, and 10 are 
effective the day following final enactment. 
 (f) Sections 13 and 14 are 
effective the day after the governing body of independent school district No. 
625, St. Paul, complies with Minnesota Statutes, section 645.021, subdivision 
3. 
 
 
 Section 1. Minnesota Statutes 1996, section 43A.17, 
subdivision 9, is amended to read: 
 Subd. 9. [POLITICAL SUBDIVISION COMPENSATION LIMIT.] The 
salary and the value of all other forms of compensation of a person employed by 
a statutory or home rule charter city, county, town,  (1) employee benefits that are also provided for the 
majority of all other full-time employees of the political subdivision, vacation 
and sick leave allowances, health and dental insurance, disability insurance, 
term life insurance, and pension benefits or like benefits the cost of which is 
borne by the employee or which is not subject to tax as income under the 
Internal Revenue Code of 1986; 
 (2) dues paid to organizations that are of a civic, 
professional, educational, or governmental nature; and 
 (3) reimbursement for actual expenses incurred by the 
employee which the governing body determines to be directly related to the 
performance of job responsibilities, including any relocation expenses paid 
during the initial year of employment. 
 The value of other forms of compensation shall be the 
annual cost to the political subdivision for the provision of the compensation. 
The salary of a medical doctor or doctor of osteopathy occupying a position that 
the governing body of the political subdivision has determined requires an M.D. 
or D.O. degree is excluded from the limitation in this subdivision. The 
commissioner may increase the limitation in this subdivision for a position that 
the commissioner has determined requires special expertise necessitating a 
higher salary to attract or retain a qualified person. The commissioner shall 
review each proposed increase giving due consideration to salary rates paid to 
other persons with similar responsibilities in the state and nation. The 
commissioner may not increase the limitation until the commissioner has 
presented the proposed increase to the legislative coordinating commission and 
received the commission's recommendation on it. The recommendation is advisory 
only. If the commission does not give its recommendation on a proposed increase 
within 30 days from its receipt of the proposal, the commission is deemed to 
have recommended approval. 
 Sec. 2. Minnesota Statutes 1996, section 43A.17, 
subdivision 10, is amended to read: 
 Subd. 10. [LOCAL ELECTED OFFICIALS; CERTAIN COMPENSATION 
PROHIBITED.] The compensation plan for an elected official of a statutory or 
home rule charter city, county, or town Sec. 3. Minnesota Statutes 1996, section 120.064, 
subdivision 11, is amended to read: 
 Subd. 11. [EMPLOYMENT AND OTHER OPERATING MATTERS.] (a) A charter school shall employ or contract with 
necessary teachers, as defined by section 125.03, subdivision 1, who hold valid 
licenses to perform the particular service for which they are employed in the 
school. The school may employ necessary employees who are not required to hold 
teaching licenses to perform duties other than teaching and may contract for 
other services. The school may discharge teachers and nonlicensed employees. 
 (b) A charter school may enter 
into a contract for teaching or administrative services related to instruction 
only with: 
 (1) an individual teacher for the 
teaching services of that teacher; 
 (2) an individual administrator 
for the administrative services of that administrator; or 
 (3) a nonprofit entity not 
controlled by or under common control with a related organization as defined in 
section 317A.011, subdivision 18, that is other than a nonprofit 
corporation. 
 Nothing in this subdivision shall 
prevent a charter school from contracting with other entities for administrative 
or instructional services if those services do not constitute the entire 
administration or operation of the charter school. 
 (c) The board of directors 
also shall decide matters related to the operation of the school, including 
budgeting, curriculum and operating procedures. 
 Sec. 4. Minnesota Statutes 1997 Supplement, section 
120.101, subdivision 5, is amended to read: 
 Subd. 5. [AGES AND TERMS.] (a) 
Every child between seven and 16 years of age shall receive instruction. Every 
child under the age of seven who is enrolled in a half-day kindergarten, or a 
full-day kindergarten program on alternate days, or other kindergarten programs 
shall receive instruction. Except as provided in subdivision 5a, a parent may 
withdraw a child under the age of seven from enrollment at any time. 
 (b) A school district by annual 
board action may require children subject to this subdivision to receive 
instruction in summer school. A district that acts to require children to 
receive instruction in summer school shall establish at the time of its action 
the criteria for determining which children must receive instruction. 
 Sec. 5. Minnesota Statutes 1996, section 120.73, 
subdivision 1, is amended to read: 
 Subdivision 1. A school board is authorized to require 
payment of fees in the following areas: 
 Sec. 6. Minnesota Statutes 1997 Supplement, section 
121.11, subdivision 7c, is amended to read: 
 Subd. 7c. [RESULTS-ORIENTED GRADUATION RULE.] (a) The 
legislature is committed to establishing a rigorous, results-oriented graduation 
rule for Minnesota's public school students. To that end, the state board shall 
use its rulemaking authority under subdivision 7b to adopt a statewide, 
results-oriented graduation rule to be implemented starting with students 
beginning ninth grade in the 1996-1997 school year. The board shall not 
prescribe in rule or otherwise the delivery system or form of instruction that 
local sites must use to meet the requirements contained in this rule. 
 (b) To successfully accomplish paragraph (a), the state 
board shall set in rule high academic standards for all students. The standards 
must contain the foundational skills in the three core curricular areas of 
reading, writing, and mathematics while meeting requirements for high school 
graduation. The standards must also provide an opportunity for students to excel 
by meeting higher academic standards through a profile of learning that uses 
curricular requirements to allow students to expand their knowledge and skills 
beyond the foundational skills. All state board actions regarding the rule must 
be premised on the following: 
 (1) the rule is intended to raise academic expectations 
for students, teachers, and schools; 
 (2) any state action regarding the rule must evidence 
consideration of school district autonomy; and 
 (3) the department of children, families, and learning, 
with the assistance of school districts, must make available information about 
all state initiatives related to the rule to students and parents, teachers, and 
the general public in a timely format that is appropriate, comprehensive, and 
readily understandable. 
 (c) For purposes of adopting the rule, the state board, 
in consultation with the department, recognized psychometric experts in 
assessment, and other interested and knowledgeable educators, using the most 
current version of professional standards for educational testing, shall 
evaluate the alternative approaches to assessment. 
 (d) The content of the graduation rule must differentiate 
between minimum competencies reflected in the basic requirements assessment and 
rigorous profile of learning standards. When fully implemented, the requirements 
for high school graduation in Minnesota must include both basic requirements and 
the required profile of learning. The profile of learning must measure student 
performance using performance-based assessments compiled over time that 
integrate higher academic standards, higher order thinking skills, and 
application of knowledge from a variety of content areas. The profile of 
learning shall include a broad range of academic experience and accomplishment 
necessary to achieve the goal of preparing students to function effectively as 
purposeful thinkers, effective communicators, self-directed learners, productive 
group participants, and responsible citizens. The 
commissioner, with the assistance of the office of educational accountability, 
the clearinghouse of best educational practices, and the technical quality 
review advisory panel under section 121.1115, shall develop and disseminate to 
school districts a uniform form and method for districts to use in measuring and 
reporting student performance on the profile of learning at the school, 
district, and state levels beginning with the 1999-2000 school year and 
thereafter. 
 (e) The state board shall periodically review and report 
on the assessment process and student achievement with the expectation of 
raising the standards and expanding high school graduation requirements. 
 (f) The state board shall report in writing to the 
legislature annually by January 15 on its progress in developing and 
implementing the graduation requirements according to the requirements of this 
subdivision and section 123.97 until such time as all the graduation 
requirements are implemented. 
 Sec. 7. Minnesota Statutes 1997 Supplement, section 
121.1113, subdivision 1, is amended to read: 
 Subdivision 1. [STATEWIDE TESTING.] (a) The commissioner, 
with advice from experts with appropriate technical qualifications and 
experience and stakeholders, shall include in the comprehensive assessment 
system, for each grade level to be tested, a single statewide norm-referenced or 
criterion-referenced test, or a combination of a norm-referenced and a 
criterion-referenced test, which shall be highly correlated with the state's 
graduation standards and administered annually to all students in the third, 
fifth, and eighth grades. The commissioner shall establish one or more months 
during which schools shall administer the tests to students each school year. 
The Minnesota basic skills tests in reading and mathematics shall fulfill 
students' eighth grade testing requirements. School 
districts shall continue to administer official state basic skills tests in 
reading and mathematics between one and three times per year to a student until 
the student receives a passing score on those state tests, thereby fulfilling 
the student's eighth grade testing requirements. Other testing options do not 
fulfill the student's eighth grade testing requirements for a passing state 
notation. 
 (b) In addition, at the secondary level, districts shall 
assess student performance in all required learning areas and selected required 
standards within each area of the profiles of learning. The testing instruments 
and testing process shall be determined by the commissioner. The results shall 
be aggregated at the site and district level. The testing shall be administered 
beginning in the 1999-2000 school year and thereafter. 
 (c) The comprehensive assessment system shall include an 
evaluation of school site and school district performance levels during the 
1997-1998 school year and thereafter using an established performance baseline 
developed from students' test scores under this section that records, at a 
minimum, students' unweighted mean test scores in each tested subject, a second 
performance baseline that reports, at a minimum, the same unweighted mean test 
scores of only those students enrolled in the school by January 1 of the 
previous school year, and a third performance baseline that reports the same 
unweighted test scores of all students except those students receiving limited 
English proficiency instruction. The evaluation also shall record separately, in 
proximity to the performance baselines, the percentages of students who are 
eligible to receive a free or reduced price school meal, demonstrate limited 
English proficiency, or are eligible to receive special education services. 
 (d) In addition to the testing and reporting requirements 
under paragraphs (a), (b), and (c), the commissioner, in consultation with the 
state board of education, shall include the following components in the 
statewide educational accountability and public reporting system: 
 (1) uniform statewide testing of all third, fifth, 
eighth, and post-eighth grade students with exemptions, only with parent or 
guardian approval, from the testing requirement only for those very few students 
for whom the student's individual education plan team under section 120.17, 
subdivision 2, determines that the student is incapable of taking a statewide 
test, or a limited English proficiency student under section 126.262, 
subdivision 2, if the student has been in the United States for fewer than 12 
months and for whom special language barriers exist, such as the student's 
native language does not have a written form or the district does not have 
access to appropriate interpreter services for the student's native language; 
 (2) educational indicators that can be aggregated and 
compared across school districts and across time on a statewide basis; 
 (3) students' scores on the American College Test; 
 (4) participation in the National Assessment of 
Educational Progress so that the state can benchmark its performance against the 
nation and other states, and, where possible, against other countries, and 
contribute to the national effort to monitor achievement; and 
 (5) basic skills and advanced competencies connecting 
teaching and learning to high academic standards, assessment, and transitions to 
citizenship and employment. 
 (e) Districts must report exemptions under paragraph (d), 
clause (1), to the commissioner consistent with a format provided by the 
commissioner. 
 Sec. 8. Minnesota Statutes 1996, section 121.1115, is 
amended by adding a subdivision to read: 
 Subd. 1b. [EDUCATIONAL 
ACCOUNTABILITY.] (a) In realizing its purpose under Laws 
1997, First Special Session chapter 4, article 5, section 28, subdivision 2, the 
office of educational accountability shall advise the education committees of 
the legislature at least on a biennial basis, on the degree to which the 
statewide educational accountability and reporting system includes a 
comprehensive, performance-based assessment framework that makes schools 
accountable for students achieving the goals described in the state's high 
school graduation rule. The office shall consider whether the statewide system 
of educational accountability provides useful comparative and contextual data on 
students, schools, districts, and the state, and whether it includes: 
 (1) public reporting on the 
condition of the educational system using multiple indicators that are essential 
to describing and understanding the needs of children and youth and apply to all 
students; 
 (2) a core set of educational 
indicators that are comparable and capable of being aggregated across school 
districts and across time on a statewide basis; 
 (3) public reporting on the 
condition of the educational system that supports the direction of state 
educational policy; 
 (4) a public reporting system that 
is flexible and permits the adding, modifying, and deleting of measures as 
policies and circumstances change; 
 (5) a public reporting system that 
aligns conceptually and in practice with the information needs of local school 
districts and contains measures that local communities and schools can 
influence; 
 (6) reports of performance 
information that ensure all students' privacy and confidentiality; 
 (7) student performance indicators 
that contain clearly articulated standards of student performance and have broad 
community support; 
 (8) reports of educational 
performance that reflect current results and trends over time; 
 (9) a reporting system that 
reduces and consolidates the existing reporting burden on school districts by 
better using existing information and building on current data reporting systems 
at the state and district levels; and 
 (10) a reporting system that is 
managed in a nonpartisan and highly competent manner to ensure the public's use 
and confidence and minimizes the reporting burden on school districts. To the 
extent the statewide educational accountability and reporting system does not 
include a comprehensive, performance-based assessment framework that makes 
schools accountable for students achieving the goals described in the state's 
high school graduation rule, or does not provide useful comparative and 
contextual data on students, schools, districts, and the state, the office shall 
recommend to the legislature ways to improve the accountability and reporting 
system. 
 (b) When the office reviews the 
statewide educational accountability and reporting system, it shall also: 
 (1) consider the objectivity and 
neutrality of the state's educational accountability system; 
 (2) develop strong relationships 
with other policy actors and with leaders outside government; and 
 (3) consider the impact of a high 
stakes testing program on school curriculum and student learning. 
 (c) A technical quality review 
advisory panel is established to assist the office of educational accountability 
in clearly articulating the criteria for judging the statewide education 
accountability and reporting system. Among other things, the criteria shall 
measure the extent to which the system: 
 (1) creates intended and 
unintended consequences; 
 (2) is fairly administered; 
 (3) evaluates the desired and 
appropriate complex intellectual processes; 
 (4) is relevant and meaningful to 
teachers, students, and parents; 
 (5) evaluates skills that are 
transferable; 
 (6) is cost-efficient; and 
 (7) is comprehensive in its 
coverage of content. 
 Panel members shall include 
psychometricians and other experts in the field of student assessment, an 
elementary school teacher employed in a state public school, a secondary school 
teacher employed in a state public school, a curriculum and instruction director 
employed in a state public school, and a local public school administrator. 
Panel members are appointed by and serve at the pleasure of the speaker of the 
house, the house minority leader, the majority leader of the senate, and the 
senate minority leader. Panel members shall receive compensation according to 
section 15.059, subdivision 3. 
 (d) The office of educational 
accountability shall report at least biennially by November 1 preceding the 
first year of the state's biennial legislative session to the education 
committees of the legislature on the status of the statewide system of 
educational accountability. 
 Sec. 9. Minnesota Statutes 1996, section 121.1115, is 
amended by adding a subdivision to read: 
 Subd. 1c. [CLEARINGHOUSE OF 
BEST EDUCATIONAL PRACTICES; DIRECTOR.] (a) To provide 
practical, effective assistance to schools with academically at-risk students, a 
clearinghouse of best educational practices is established to make available to 
interested school districts human and informational resources for improving 
student performance. The clearinghouse shall: 
 (1) conduct research and collect 
information on the best educational practices affecting a school's management, 
operation, financing, personnel, and instruction; 
 (2) train quality intervention 
teams composed of highly qualified educators to assist a school's staff in 
working to improve the educational performance of academically at-risk students 
by addressing a school's management, operation, financing, personnel, and 
instruction practices; 
 (3) develop and make available to 
interested school districts a model for an independent educational audit that 
evaluates a school's performance strengths and weaknesses and makes specific 
recommendations for reinforcing performance strengths and improving performance 
weaknesses cited in the audit; 
 (4) using the comprehensive, 
performance-based assessment framework under subdivision 1b, paragraph (a), and 
with the assistance of the office of educational accountability, develop student 
and school performance indicators schools may use to reliably measure school 
improvement over time; and 
 (5) provide staff development 
opportunities to assist teachers and other educators in integrating educational 
reform measures into a school's best practices. 
 The clearinghouse shall assist 
school districts under this subdivision at district request. 
 (b) The office of educational 
accountability, in consultation with organizations representing the state's 
kindergarten through grade 12 public school teachers, shall appoint a licensed 
kindergarten through grade 12 teacher as director of the clearinghouse. The 
director shall receive a one-year sabbatical leave to serve as clearinghouse 
director and may receive additional one-year sabbatical leaves for this 
purpose. 
 Sec. 10. Minnesota Statutes 1996, section 125.191, is 
amended to read: 
 125.191 [LICENSE AND DEGREE EXEMPTION FOR HEAD COACH.] 
 Notwithstanding section 125.03, subdivision 1, a school 
district may employ as a head varsity coach of an interscholastic sport at its 
secondary school a person who does not have a license as head varsity coach of 
interscholastic sports and who does not have a bachelor's degree if: 
 (1) in the judgment of the school board, the person has 
the knowledge and experience necessary to coach the sport; 
 (2)  Notwithstanding section 125.121, a person employed as a 
head varsity coach under this section has an annual contract as a coach that the 
school board may or may not renew as the board sees fit Sec. 11. [126.238] [ACCELERATED INSTRUCTION FOR HIGH 
SCORING STUDENTS.] 
 Every district shall provide 
accelerated instruction to all enrolled elementary and secondary students who 
score three standard deviations above the norm on a standardized achievement 
test. Each high scoring student shall have a written accelerated learning plan 
developed by an accelerated learning plan team that includes the student's 
teachers, parents, and school counselor and may include other qualified 
educators and the student if the student is a secondary school student. The plan 
shall state the educational outcomes the student will work to achieve, 
indicating the curricular content of the educational outcomes and the 
instructional strategies to be used in providing curricula. Cost to the school 
district may be among the factors the team considers in choosing how to provide 
the accelerated instruction contained in the student's plan. The school district 
shall make the final decision about the contents of a plan. Plan contents shall 
be consistent with and enhance the requirements of the state's results-oriented 
high school graduation rule. The accelerated learning plan 
 of each secondary student shall provide for a transition 
from secondary school to post-secondary education, employment, or community 
service. The district shall evaluate a student's success in achieving the 
educational outcomes stated in the accelerated learning plan and the contents of 
the plan at least once per school year. School districts with a small number of 
high scoring students may cooperate with other districts in providing the 
students with sufficient opportunities for accelerated instruction as stated in 
the student's accelerated learning plan. Sec. 12. Minnesota Statutes 1996, section 260.015, 
subdivision 19, is amended to read: 
 Subd. 19. [HABITUAL TRUANT.] "Habitual truant" means a 
child under the age of 16 years who is absent from attendance at school without 
lawful excuse for seven school days if the child is in elementary school or for 
one or more class periods on seven school days if the child is in middle school, 
junior high school, or high school, or a child who is 16 
or 17 years of age who is absent from attendance at school without lawful excuse 
for one or more class periods on seven school days and who has not lawfully 
withdrawn from school under section 120.101, subdivision 5d. 
 Sec. 13. Minnesota Statutes 1996, section 260.132, 
subdivision 4, is amended to read: 
 Subd. 4. [TRUANT.] When a peace officer or probation 
officer has probable cause to believe that a child is  Sec. 14. Laws 1997, First Special Session chapter 4, 
article 5, section 24, subdivision 4, is amended to read: 
 Subd. 4. [GRANT AWARDS.] A school district or any group 
of districts may receive a grant in the amount of $25 per pupil per year.  Sec. 15. Laws 1997, First Special Session chapter 4, 
article 5, section 28, subdivision 4, is amended to read: 
 Subd. 4. [ADVANCED PLACEMENT AND INTERNATIONAL 
BACCALAUREATE PROGRAMS.] For the state advanced placement and international 
baccalaureate programs: 
 $1,875,000 . . . . . 1998 
 $1,875,000 . . . . . 1999 
 Notwithstanding Minnesota Statutes, section 126.239, 
subdivisions 1 and 2, $200,000 each year is for teachers to attend subject 
matter summer training programs and follow-up support workshops approved by the 
advanced placement or international baccalaureate programs. The amount of the 
subsidy for each teacher attending an advanced placement or international 
baccalaureate summer training program or workshop shall be the same. The 
commissioner shall determine the payment process and the amount of the subsidy. 
 Notwithstanding Minnesota Statutes, section 126.239, 
subdivision 3, in each year to the extent of available appropriations, the 
commissioner shall pay all examination fees for all students sitting for an 
advanced placement examination, international baccalaureate examination, or 
both. If this amount is not adequate, the commissioner may pay less than the 
full examination fee. 
 $300,000 each year is for student scholarships. A student 
scholarship shall be awarded to a student scoring three or better on one or more 
advanced placement examinations or a four or better on one or more international 
baccalaureate examinations. The amount of each scholarship shall range from  must be used by the student only for tuition, required 
fees, and books in nonsectarian courses or programs. The higher education 
services office, in consultation with the commissioner, shall determine the 
payment process, the amount of the scholarships, and provisions for unused 
scholarships. 
 In order to be eligible to receive advanced placement or 
international baccalaureate scholarships on behalf of the qualifying students, 
the college or university must have an advanced placement, international 
baccalaureate, or both, credit and placement policy for the scholarship 
recipients. In addition, each college or university must certify these policies 
to the department each year. The department must provide each secondary school 
in the state with a copy of the post-secondary advanced placement and 
international baccalaureate policies each year. 
 $375,000 each year is for teacher stipends. A teacher who 
teaches an advanced placement or international baccalaureate course shall 
receive a stipend for each student in that teacher's course who receives a three 
or better on the advanced placement or a four or better on the international 
baccalaureate examination that covers the subject matter of the course. The 
commissioner shall determine the payment process and the amount of the teacher 
stipend ranging from $25 to $50 for each student receiving a qualifying score. 
 A stipend awarded to a teacher under this subdivision 
shall not be a mandatory subject of bargaining under Minnesota Statutes, chapter 
179A, or any other law and shall not be a term or condition of employment. The 
amount of any award shall be final and shall not be subject to review by an 
arbitrator through any grievance or other process or by a court through any 
appeal process. 
 Any balance in the first year does not cancel but is 
available in the second year. 
 Sec. 16. Laws 1997, First Special Session chapter 4, 
article 5, section 28, subdivision 9, is amended to read: 
 Subd. 9. [COLLABORATIVE URBAN EDUCATOR PROGRAMS.] For 
grants to collaborative urban educator programs that prepare and license people 
of color to teach: 
 
 $895,000 . . . . . 1998 
 $150,000 . . . . . 1999 
 This appropriation is available until June 30, 1999. 
 Sec. 17. [RULE REVISION.] 
 The state board of education shall 
amend or repeal those portions of Minnesota Rules, parts 3501.0010 to 3501.0180, 
necessary to conform with the basic skills testing requirements in reading and 
mathematics under Minnesota Statutes, section 121.1113, subdivision 1. 
 Sec. 18. [EXEMPTION.] 
 Any contract entered into during 
the 1996-1997 school year authorizing a charter school under Minnesota Statutes, 
section 120.064, subdivision 5, is exempt from the amended requirements of 
Minnesota Statutes, section 120.064, subdivision 11, only as long as the sponsor 
of the charter school finds and can adequately demonstrate to the state board of 
education that the charter school continues without interruption to 
satisfactorily meet all its performance outcomes. If either the charter school 
sponsor or the state board of education determines that the charter school under 
this section is not satisfactorily meeting one or more of its performance 
outcomes, the amended requirements of Minnesota Statutes, section 120.064, 
subdivision 11, apply to that charter school. 
 Sec. 19. [REPORT ON COOPERATIVE SPONSORSHIPS.] 
 A school district shall 
immediately transmit to the commissioner of children, families, and learning 
information about each decision to deny a home school a cooperative sponsorship 
under state high school league rules or to otherwise deny a home school student 
an opportunity to participate in the district's extracurricular activities. The 
school district shall 
 transmit the information in the form and manner the 
commissioner requires. The commissioner shall prepare an interim written report 
by February 1, 1999, and a final written report by February 1, 2000, for the 
speaker of the house, the senate majority leader, and the chairs of the house 
and senate education committees detailing by school district the instances when 
a school district denies a home school a cooperative sponsorship or a home 
school student an opportunity to participate in an extracurricular activity and 
the district rationale for the denial. Sec. 20. [YEAR-ROUND SCHOOL/EXTENDED WEEK OR DAY PILOT 
PROGRAM.] 
 (a) Consistent with the terms for 
receiving program grants under Laws 1995, First Special Session chapter 3, 
article 7, section 4, as amended by Laws 1996, chapter 412, article 7, section 
13, independent school district No. 241, Albert Lea, is eligible to receive 
additional grant funding for its year-round school/extended week or day pilot 
program. 
 (b) The commissioner of children, 
families, and learning, with the assistance of independent school district No. 
241, Albert Lea, shall evaluate the efficacy of the district's program and 
submit a report to the education committees of the legislature by February 1, 
2001. The commissioner shall include in the report sufficient information to 
permit other school districts to readily replicate the program if the 
commissioner determines that the program is successful. 
 Sec. 21. [COUNSELOR ASSESSMENT.] 
 The department of children, 
families, and learning, in consultation with affected groups, shall conduct an 
assessment of the need for expanding the number of counselors in school 
districts. As part of the assessment, the department shall consider recommended 
ratios and the costs of meeting these, alternative strategies for collaboration 
to provide counseling services to pupils especially in small districts, 
mechanisms to strengthen collaboration between school districts and local 
colleges and universities in providing information and experience to pupils, and 
suggestions for meeting the needs of pupils for counseling that is focused on 
academic and career needs and planning. The department shall report its findings 
and recommendations to the education committees of the house and senate as part 
of its 2000-2001 biennial budget request. 
 Sec. 22. [YOUTH ATHLETIC DEMONSTRATION PROGRAM.] 
 (a) A demonstration athletic grant 
program through special school district No. 1, Minneapolis, and the Minneapolis 
park and recreation board is established for children ages seven to 14 at Waite 
Park school. The goal of the demonstration program is to develop a 
neighborhood-based athletic program that teaches sports fundamentals to students 
that will lead to their participation in high school level athletics. The 
program shall be year-round and shall require both in-school and after-school 
participation by students. A student who satisfactorily completes the program 
curriculum shall receive secondary course credit and the credit shall count 
towards the student's graduation requirements consistent with Minnesota 
Statutes, section 126.83. 
 (b) The program shall be 
established at Waite Park school in Minneapolis where the school facility and 
park and recreation facility are jointly located and where the school district 
has established a neighborhood-based school for enrollment purposes. The school 
district and the park and recreation board shall recruit at-risk students and 
those students who have not participated in current after-school park programs 
to participate in the demonstration project. 
 (c) The program funds shall be 
used for recreational professionals at the park board to coordinate the program 
and licensed teachers employed in the district; internships for students at the 
University of Minnesota, Augsburg College, or other post-secondary institutions 
to work in the program; master coaches to train coaches; transportation costs; 
facilities' costs; and assistance to neighborhood park athletic councils. 
 (d) The school district and the 
park board shall report to the commissioner of children, families, and learning 
on the outcome of the program. The commissioner shall report to the education 
committees of the legislature on the program and the advisability of creating a 
statewide program by March 15, 1999. 
 Sec. 23. [RESIDENTIAL ACADEMY PROGRAM.] 
 Subdivision 1. [PUBLIC GRANT 
RECIPIENT.] The commissioner of children, families, and 
learning may award grants to a public organization for start-up costs for 
residential academies for students in grades 4 through 12 who express a desire 
to attend a residential academy that provides a secure and nurturing learning 
environment, have demonstrated an interest in learning and a potential for 
academic achievement, and who: 
 (1) perform or are at risk of 
performing below the academic performance level for pupils of the same age; 
 (2) are at least one year behind 
in satisfactorily completing coursework or obtaining credits for graduation; 
or 
 (3) have experienced homelessness 
or an unstable home environment. 
 Subd. 2. [ORGANIZATIONAL 
STRUCTURE.] The public grant recipient may collaborate 
with other organizations in effecting this subdivision. 
 (a) Enrollment is voluntary. A 
student may be referred to an academy by a parent or guardian, the student's 
county of residence, the student's school, health care provider, or the judicial 
system. 
 (b) A residential academy must 
provide an education program for the resident students to: 
 (1) increase school 
attendance; 
 (2) increase academic 
achievement; 
 (3) enable secondary students to 
earn a high school diploma; and 
 (4) improve for secondary students 
the transition to post-secondary education or the transition from school to 
work. 
 The academy may collaborate with a 
school district or charter school to provide the education program. 
 (c) To the extent allowed in law, 
education and social services funding shall follow each child from the child's 
school district or county of residence to the academy. 
 (d) The cost of residential care 
for a student may be covered under a sliding fee program based on student 
need. 
 (e) An academy may receive any 
gift, grant, bequest, or devise. 
 (f) The commissioner of children, 
families, and learning shall prescribe the form and manner of applications. The 
commissioner shall consider the academy's location, the composition of the 
academy's governance structure and board, collaborative effort among various 
organizations, family and community involvement, provision of social services, 
quality of education program, after-school enrichment, and provision of 
instruction throughout the entire year in awarding grants. The commissioner 
shall evaluate the residential academy program and report to the education 
committees of the legislature by February 15, 2000. 
 Sec. 24. [SARTELL; SCHOOL YEAR START DATE.] 
 Notwithstanding Minnesota 
Statutes, section 126.12, subdivision 1, and Laws 1997, First Special Session 
chapter 4, article 7, section 49, subdivision 1, independent school district No. 
748, Sartell, may begin the 1998-1999 school year before Labor Day only by the 
number of days necessary to accommodate the district building construction 
project. 
 Sec. 25. [HOLDINGFORD; SCHOOL YEAR START DATE.] 
 Notwithstanding Minnesota 
Statutes, section 126.12, subdivision 1, and Laws 1997, First Special Session 
chapter 4, article 7, section 49, subdivision 1, independent school district No. 
738, Holdingford, may begin the 1998-1999 school year on the Monday prior to 
Labor Day. 
 Sec. 26. [COMMISSIONER OF CHILDREN, FAMILIES, AND 
LEARNING.] 
 The commissioner of children, 
families, and learning shall designate a staff member as a resource person for 
gifted and talented programs to provide assistance to parents and school 
districts. The commissioner shall pay all costs for that staff member out of 
existing department appropriations. 
 Sec. 27. [RESIDENCY REQUIREMENT.] 
 The downtown Minneapolis magnet 
school that is part of the western metropolitan education program may enroll in 
the magnet school only those otherwise qualified students who reside within one 
of the nine participating school districts. No student residing in any other 
district and participating in a program under Minnesota Statutes, section 
120.062, may enroll in the magnet school. 
 Sec. 28. [TASK FORCE ON KINDERGARTEN THROUGH GRADE 12 
EDUCATION GOVERNANCE STRUCTURE.] 
 Subdivision 1. [ESTABLISHMENT; 
PURPOSE.] A task force on kindergarten through grade 12 
education governance structure is established to examine alternatives for 
governing the state's kindergarten through grade 12 education system. 
 Subd. 2. [MEMBERSHIP.] The task force shall consist of 15 members. The department 
of children, families, and learning shall provide staff support for task force 
activities. Task force members, appointed by the panel under subdivision 3, must 
include five people directly involved in public education, five people who 
represent state or local governments, and five people who are public members, 
including parents, business leaders, labor leaders, and others who have 
demonstrated a commitment to excellence in Minnesota public schools. Membership 
terms and removal are governed by Minnesota Statutes, section 15.059. 
 Subd. 3. [PANEL.] A panel, composed of one person appointed by the governor, 
one person appointed by the speaker of the house of representatives, and one 
person appointed by the subcommittee on committees of the senate committee on 
rules and administration, shall appoint the members of the task force. The panel 
shall consider gender and geographical and racial diversity in making the 
appointments. The commissioner of children, families, and learning shall convene 
the first meeting of the panel. The panel must make the first appointments to 
the task force by July 15, 1998. 
 Subd. 4. [TASK FORCE 
ACTIVITIES.] The task force shall examine alternatives 
for governing the state's kindergarten through grade 12 education system by 
considering at least the following: 
 (1) the roles of the legislature, 
governor's office, state board of education, and the commissioner of children, 
families, and learning in making statewide policy and administrative decisions 
affecting kindergarten through grade 12 education; 
 (2) the extent to which the 
current structure of regional and local government units, including service 
units, education districts, school districts, city councils, and county boards, 
promotes or inhibits intergovernmental collaboration; 
 (3) how to facilitate broad-based 
collaboration between schools and state and county-based social service agencies 
serving the same or similar populations of children and families; and 
 (4) how to best accommodate 
changing educational needs and demands. 
 Subd. 5. [REPORT.] The task force shall submit a report of its findings and 
recommendations to the chairs of the education committees in the house and the 
senate by February 15, 1999. 
 Subd. 6. [EXPIRATION.] The task force expires on June 1, 1999. 
 Sec. 29. [APPROPRIATION; BOARD OF REGENTS.] 
the subdivision, as appropriate, any property or materials
owned by the state or subdivision except pursuant to conditions provided in this section.  Property or materials owned by
the state or a subdivision, except real property, and not needed for public purposes, may be sold to an employee of the state
or the subdivision after reasonable public notice at a public auction or by sealed bid if the employee
is the highest responsible bidder and response, if the employee is not directly involved in the auction or
process pertaining to the administration and collection of sealed bid process responses. 
Requirements for reasonable public notice may be prescribed by other law or ordinance so long as at least one week's
published or posted notice is specified. A state An employee of the state or a political
subdivision may purchase no more than one motor vehicle from the state in any 12-month period.  A person violating
the provisions of this section is guilty of a misdemeanor.  This section shall not apply to the sale of property or materials
acquired or produced by the state or subdivision for sale to the general public in the ordinary course of business.  Nothing
in this section shall prohibit an employee of the state or a political subdivision from selling or possessing for sale public
property if the sale or possession for sale is in the ordinary course of business or normal course of the employee's
duties. shall may purchase items directly from corrections industries those items that are comparable
in price, quality, and delivery time to items available from other vendors.  An item is comparable in price if the price is
no more than five percent higher than the lowest bid price. The bid solicitation process is not required for these
purchases. pursuant to section 16B.09, or
contracts to enable public entities to purchase items directly from corrections industries.  The commissioner of
administration, in consultation with the commissioner of corrections, shall determine the fair market price for listed items.
In determining fair market price, the commissioner shall use competitive bidding, or shall consider open bid prices
in previous years for similar products which meet the needs of the public entity. The commissioner of
administration shall require that all requests for bids or proposals, for items provided by corrections industries, be
forwarded to the commissioner of corrections to enable corrections industries to submit bids.  The commissioner of
corrections shall consult with the commissioner of administration prior to introducing new products to the state agency
market. As part of its ongoing audit process, the legislative auditor is requested to ensure that state agencies are in
compliance with this section. The commissioners of administration and corrections shall develop annual
performance measures outlining goals to maximize inmate work program participation.  The commissioners of
administration and corrections shall appoint cochairs for a task force whose purpose is to determine additional methods
to achieve the performance goals for public entity purchasing.  The task force shall include representatives from the
Minnesota house of representatives, Minnesota senate, the Minnesota state colleges and universities, University of
Minnesota, Minnesota League of Cities, Minnesota Association of Counties, and administrators with purchasing
responsibilities from the Minnesota state departments of corrections, public safety, finance, transportation, natural
resources, human services, health, and economic security. The commissioners of administration and corrections shall appoint a joint task force to explore additional
methods that support the philosophy of providing a substantial market opportunity to correctional industries that
maximizes inmate work opportunities.  The task force shall develop a plan and prepare a set of criteria with which to
evaluate the effectiveness of the recommendations and initiatives in the plan.  By February 15, 1997, the task force shall
report to the chairs of the senate and house of representatives committees having jurisdiction over criminal justice
funding. If performance goals for public entity purchasing are not achieved in two consecutive fiscal years, public
entities shall purchase items available from corrections industries.  The commissioner of administration shall be
responsible for notifying public entities of this requirement. 
No department or agency of the state shall accept any bid or 
proposal for a contract or agreement (a) For all 
contracts for goods and services in excess of $100,000, no department or agency 
of the state shall accept any bid or proposal for a contract or agreement from 
any business having more than 40 full-time employees within this state on a 
single working day during the previous 12 months, unless the firm or 
business has an affirmative action plan for the 
employment of minority persons, women, and qualified disabled individuals, 
submitted to the commissioner of human rights for approval. No department or 
agency of the state shall execute any such contract 
or agreement for goods or services in excess of $100,000 
with any business having more than 40 full-time employees, either within or 
outside this state, on a single working day during the previous 12 months, 
unless the firm or business has an until the 
affirmative action plan for the employment of minority 
persons, women, and the disabled that has been approved by 
16B.17 16C.09, subdivision 1, but does not include legal 
services for official legislative business. 
16B.19 16C.18, subdivision 2 3, have been verified or 
complied with; 
16B.06, 16B.07, 16B.08, and 16B.09 16C.03, subdivision 4, 16C.06, and 16C.07 do not apply 
to the state's selection of and contracts with structured settlement consultants 
or purveyors of structured settlement plans. 
16B 16C. The council may 
contract in its own name. Contracts must be approved by a majority of the 
members of the council and executed by the chair and the executive director. The 
council may apply for, receive, and spend in its own name, grants and gifts of 
money consistent with the powers and duties specified in this section. The 
council shall maintain its primary office in Bemidji. It shall also maintain 
personnel and office space in St. Paul. 
16B 16C as they relate to 
competitive bidding do not apply to these contracts. No contract may be made 
until the revisor of statutes has consulted with the legislative coordinating 
commission. Failure or refusal of the commission to make a recommendation 
promptly shall be deemed an affirmative recommendation. 
16B 16C, as they relate to 
competitive bidding. 
16B.06 16C.06, subdivision 4 5. The examination shall be limited to the books, 
records, documents, and accounting procedures and practices that are relevant to 
the contract or transaction with the local government. 
and 
16B.06, 16C.03, subdivision 4, and 16C.06 do not 
apply to certificates of deposit and collateralization agreements executed by 
the state board under paragraph (a), clause (2). 
16B.06 16C.06, 
subdivision 2, paragraph (a), clause (3), must be 
waived. 
section 
16B.17 sections 16C.03 and 16C.09, the head of a 
state department or agency may, with the approval of the commissioner of 
administration, contract for professional or technical services in connection 
with the operation of the department or agency. A contract negotiated under this 
section is not subject to the competitive bidding requirements of chapter 16B 16C. 
16B.17 16C.09, subdivision 1, 
as a separate category. No other expenditures may be included in this category. 
16B.07 16C.03, 
subdivision 2 3. 
16B 16C. Money appropriated for the lease or acquisition of 
this personal property is appropriated to the commissioner of finance to make 
master lease payments. 
section 16B.07, 
subdivision 2 sections 16C.06, subdivision 2, 
paragraph (a), clause (5), 16C.09, subdivision 3, clause (7), and 16C.10, clause 
(6). 
chapter chapters 16B and 16C, except 
sections 16B.167, 16B.17, and 16B.175 16C.05, 16C.08, 16C.09, and 16C.10. 
16B.06 16C.06. The 
commissioner must report revenues collected and expenditures made under this 
section to the chairs of the environment and natural resources finance committee 
in the house of representatives and the environment and agriculture budget 
division in the senate by January 15 of each odd-numbered year. 
16B 
16C relating to competitive bidding. 
16B 16C. 
16B.19 to 16B.22 16C.18 to 
16C.21. The commissioner may negotiate premium rates and coverage provisions 
with all carriers licensed under chapters 62A, 62C, and 62D. The commissioner 
may also negotiate reasonable restrictions to be applied to all carriers under 
chapters 62A, 62C, and 62D. Contracts to underwrite the benefit plans must be 
bid or negotiated separately from contracts to service the benefit plans, which 
may be awarded only on the basis of competitive bids. The commissioner shall 
consider the cost of the plans, conversion options relating to the contracts, 
service capabilities, character, financial position, and reputation of the 
carriers, and any other factors which the commissioner deems appropriate. Each 
benefit contract must be for a uniform term of at least one year, but may be 
made automatically renewable from term to term in the absence of notice of 
termination by either party. The commissioner shall, to the extent feasible, 
make hospital and medical benefits available from at least one carrier licensed 
to do business pursuant to each of chapters 62A, 62C, and 62D. The commissioner 
need not provide health maintenance organization services to an employee who 
resides in an area which is not served by a licensed health maintenance 
organization. The commissioner may refuse to allow a health maintenance 
organization to continue as a carrier. The commissioner may elect not to offer 
all three types of carriers if there are no bids or no acceptable bids by that 
type of carrier or if the offering of additional carriers would result in 
substantial additional administrative costs. A carrier licensed under chapter 
62A is exempt from the tax imposed by section 60A.15 on premiums paid to it by 
the state. 
16B.06 16C.06, subdivision 2. 
16B 16C, as they relate to competitive bidding. 
16B.06 
16C.06. The commissioner shall report revenues 
collected and expenditures made under this section to the chairs of the 
committees on appropriations in the house and finance in the senate by January 1 
of each odd-numbered year. 
section 16B.06 sections 16C.03, subdivision 4, and 16C.06 prior to 
advancing any state funds. The agreement or contract shall contain provisions 
for return of the state's share and the matching funds within a period of time 
specified by the commissioner. The state's funds and the nonstate matching funds 
must be deposited in a separate account and expended solely for the purposes set 
forth in the agreement or contract. The commissioner shall enter into agreements 
or contracts only with the National Fish and Wildlife Foundation and federal and 
nonprofit authorities deemed by the commissioner to be dedicated to the purposes 
of the project. 
16B 16C. 
chapter chapters 16B and 16C, except for sections 16B.07, 16B.102, 16B.17, 16B.19, 16B.35, and 16B.55 16B.35, 16B.55, 16C.07, 16C.09, 16C.10, and 16C.18; and 
chapter 14, except section 14.386, paragraph (a), clauses (1) and (3). Section 
14.386, paragraph (b), does not apply to the board's actions. 
16B 16C, relating to competitive bidding, provided that, 
notwithstanding subdivision 5b, the board is not required to readvertise for 
competitive proposals for any transportation system, facilities and equipment 
heretofore selected from competitive proposals. 
16B 16C does not apply to these contracts. 
chapter chapters 16B and 16C. 
16B 16C, relating to bids, shall apply to such contracts. 
16B 16C. 
16B 16C concerning 
competitive bidding. 
16B 16C 
relating to competitive bidding. 
16B.19 to 16B.22 16C.18 to 
16C.21 relating to the small targeted group business and economically 
disadvantaged business program of the state; 
sections 16B.07 and 16B.09 section 16C.07; 
16B 16C for purposes of this section. 
or, 16B, or 16C. The 
commissioner shall adopt internal procedures for administration and monitoring 
of aids and grants. 
and 16B, and 
16C, and may be deposited outside the state treasury. Money shall be 
administered under the policies of the applicable state board or agency relating 
to post-secondary and secondary vocational student organizations and is subject 
to audit by the legislative auditor. Any unexpended money shall not cancel but 
may be carried forward to the next fiscal year. 
chapter chapters 16B and 16C. 
16B 16C. All such money received by the office shall be 
deposited in the state treasury and are hereby appropriated to it annually for 
the purpose for which such funds are received. None of such moneys shall cancel 
but shall be available until expended. 
16B 16C, the Minnesota higher 
education services office is designated as the administrative agency for 
carrying out the purposes and terms of sections 136A.15 to 136A.1702. The office 
may establish one or more loan programs. 
16B 16C or section 574.26, or any other public contract or 
competitive bid law. 
16B 16C. The authority shall not be subject to the 
provisions of chapter 14, including section 14.386 in connection with the 
adoption of any rules, rents, fees or charges or with the exercise of any other 
powers or duties. 
16B 16C, the student 
associations recognized by the board of trustees of the Minnesota state colleges 
and universities may purchase goods or materials through state purchasing 
authority for the ordinary day-to-day operations of the associations. The 
student associations must be nonprofit 501(c)(3) organizations in order to 
qualify for this authority. The department of administration may require that 
the purchase documents be approved by appropriate officials in the board's 
central office. 
16B 16C. 
16B.19 16C.18. The board, 
colleges, and universities shall use the methods contained in section 471.345, 
subdivision 8, for such purchasing, or may develop additional methods in which 
the cost percentage preferences are consistent with the provision of section 16B.19 16C.18, subdivisions 
2c and 2d 6, paragraph (a), 
and 7, or consistent with the provisions of the University of Minnesota's 
targeted group business purchasing program. 
16B.19 16C.18. 
and, 16B, and 16C, shall administer its activity funds. The board, 
independent of other authority and notwithstanding chapters 16A and, 16B, and 16C, shall administer the administrative fund 
established in the system office. All activity fund money collected shall be 
administered under the policies of the board subject to audit of the legislative 
auditor. 
and, 16B, and 16C. 
16B.19 16C.18, subdivision 5. 
16B.19 16C.18, 
subdivision 5, if the regents determine that at least three small targeted 
group businesses are likely to bid. 
16B.19 16C.18, subdivision 7. 
16B.19 to 16B.22 16C.18 to 
16C.21 apply to this section. 
16B.19 16C.18 when 
making purchases that are not subject to competitive bidding procedures. 
16B 16C, as it relates to competitive bidding. The state 
archaeologist may recruit, train, and accept, without regard to personnel laws 
or rules, the services of individuals as volunteers for or in aid of performance 
of the state archaeologist's duties, and may provide for the incidental expenses 
of volunteers, such as transportation, lodging, and subsistence. The state 
archaeologist may apply for, receive, and expend grants and gifts of money 
consistent with the powers and duties in sections 138.31 to 138.42. Any money so 
received is appropriated for the purpose for which it was granted. 
16B 16C. 
16B.17 16C.09. 
16B.08 16C.11, subdivision 6 2; 
16B.19 16C.18, subdivision 2b 5. 
16B.19 16C.18, subdivision 7. 
16B 16C. 
16B.19 to 16B.22 16C.18 to 
16C.21 apply to this section. The commissioner may promulgate other rules 
necessary to carry out this section. 
16B.19 16C.18 when 
making purchases that are not subject to competitive bidding procedures. 
16B 16C if no state agency or political subdivision of this 
state offers to purchase the surplus property for its determined value. 
16B.17 16C.09, subdivision 1; 
16B.07 16C.07 and shall 
provide for the preferential employment by a party of members of that unit whose 
employment with the state of Minnesota or the University of Minnesota is 
terminated as a result of that contract. 
16B.17 16C.09 and the preferential employment provisions 
enumerated in this section. Any court reporter seeking a contract pursuant to 
the preferential employment provisions of this section shall be given preference 
when the services are needed only if that court reporter's charges for the 
services requested are no greater than the average of the charges made for the 
identical services by other court reporters in the same locality who are also 
under contract with the state for those services. 
16B 16C. Buildings 
used for the veterans home must comply with requirements established by federal 
agencies as conditions for the receipt of federal funds for the nursing and 
boarding care of veterans. The city of Silver Bay shall secure the state match 
requirement from sources other than the state general fund. Money from other 
sources must equal at least 35 percent of the total cost of the renovation with 
the remainder of the funds to be provided by the United States Veterans 
Administration. 
16B 16C. 
16B.07 16C.07, 
subdivision 3 subdivisions 1 
and 2, and base the selection of a vendor on an 
identification of the lowest responsible bidder best 
value as provided in section 16B.09 16C.07, subdivision 1 6. The commissioner shall select and contract with the 
vendor to provide the notification center service, but all costs of the center 
must be paid by the operators. The commissioner may at any time appoint a task 
force to advise on the renewal of the contract or any other matter involving the 
center's operations. 
chapter chapters 16B and 16C, develop guidelines for the purchase of some 
communication devices from local retailers and dispensers if the department 
determines that otherwise they will be economically harmed by implementation of 
sections 237.50 to 237.56. 
chapter chapters 16B and 16C. The commissioner shall provide forms and 
instructions for submission of subsidy applications. 
16B.07 16C.07, but are subject to all other provisions of chapter 16B chapters 16B and 
16C. When practical, purchases must be made from small targeted group 
businesses designated under section 16B.19 16C.18. Additionally, the expenses of inmate vocational 
training and the inmate release fund may be financed from the correctional 
industries revolving fund in an amount to be determined by the commissioner. The 
proceeds and income from all industrial and commercial activities conducted at 
state correctional facilities shall be deposited in the correctional industries 
revolving fund subject to disbursement as hereinabove provided. The commissioner 
of corrections may request that money in the fund be invested pursuant to 
section 11A.25; the proceeds from the investment not currently needed shall be 
accounted for separately and credited to the fund. 
16B.17 16C.09 does not apply to the issuance of the request for 
proposals. 
16B 16C. The agencies, 
organizations, or persons may purchase supplies, services, and equipment to be 
used in providing services to residents of state facilities through the 
department of administration. 
16B.06 16C.06, subdivision 2, 
the commissioner of human services may delegate the execution of shared services 
contracts to the chief executive officers of the regional centers or state 
operated nursing homes. No additional employees shall be added to the 
legislatively approved complement for any regional center or state nursing home 
as a result of entering into any shared service agreement. However, positions 
funded by a shared service agreement may be authorized by the commissioner of 
finance for the duration of the shared service agreement. The charges for the 
services shall be on an actual cost basis. All receipts for shared services may 
be retained by the regional treatment center or state-operated nursing home that 
provided the services, in addition to other funding the regional treatment 
center or state-operated nursing home receives. 
16B.06 16C.06, subdivision 2, the commissioner of human 
services may delegate the execution of these dental services contracts to the 
chief executive officers of the regional centers or state-operated nursing 
homes. All receipts for these dental services shall be retained by the regional 
treatment center or state-operated nursing home that provides the services and 
shall be in addition to other funding the regional treatment center or 
state-operated nursing home receives. 
16B.19 16C.18, subdivisions 5 and 
6, paragraph (a), and 7. Contracts must specify the 
services that are included in the per capita rate. Contracts must specify those 
services that are to be eligible for risk sharing between the prepaid health 
plan and the state. Contracts must also state that payment must be made within 
60 days after the month of coverage. 
16B 16C, to 
provide items under the medical assistance program including but not limited to 
the following: 
16B 16C. 
16B 16C to arrange for 
transportation services, the county may be required to use such arrangements. 
16B 16C to arrange for transportation services, the county 
may be required to use such arrangements to be eligible for state reimbursement 
for general assistance medical care common carrier transportation and related 
travel expenses provided for medical purposes. 
section 16B.06 sections 16C.03, subdivision 4, and 16C.06. The full 
faith and credit and taxing powers of the state are not and may not be pledged 
for the payment of these bonds or other obligations, and no person has the right 
to compel the levy of any state tax for their payment or to compel the 
appropriation of any moneys of the state for their payment except as 
specifically provided herein. These bonds and obligations shall be payable 
solely from the property and moneys derived by the commissioner pursuant to the 
authority granted in this section that the commissioner pledges to their 
payment. The legislature intends not to appropriate money from the general fund 
to pay for these bonds or other obligations. All these bonds or other 
obligations must contain the provisions of this subdivision or words to the same 
effect on their face. 
16B.06 to 16B.102, and 16B.17 16C.03, 16C.06, 16C.07, 16C.09, 16C.10, and 16C.11, and 
are valid for a period of one year. The director may permit a retailer to sell 
tickets at more than one business location under a contract entered into under 
this section. 
sections 16B.06 to 16B.102 or 16B.17 section 16C.03, 16C.06, 16C.07, 16C.09, 16C.10, or 
16C.11, provided that the director must utilize an open and competitive bid 
process, and as nearly as practicable follow the procedures of chapter chapters 16B and 16C governing contracts, consistent with the 
provisions of this section. 
16B 16C. Any approved actuary 
retained by the executive director shall function as the actuarial advisor of 
the board and the executive director, and may perform actuarial valuations and 
experience studies to supplement those performed by the actuary retained by the 
legislative commission on pensions and retirement. Any supplemental actuarial 
valuations or experience studies shall be filed with the executive director of 
the legislative commission on pensions and retirement. Professional management 
services may not be contracted for more often than once in six years. Copies of 
professional management survey reports must be transmitted to the secretary of 
the senate, the chief clerk of the house of representatives, and the legislative 
reference library as provided by section 3.195, to the executive director of the 
commission and to the legislative auditor at the time as reports are furnished 
to the board. Only management firms experienced in conducting management surveys 
of federal, state, or local public retirement systems are qualified to contract 
with the director; 
, or 16C or any 
law to the contrary, the executive director of the system may use the services 
of the department of administration, information services division, for 
electronic data processing and related services or may contract for all or a 
part of the services. 
16B 16C. The commissioner of administration shall not 
approve, and the association shall not enter into, any contract to provide 
lobbying services or legislative advocacy of any kind. Any approved actuary 
retained by the executive director shall function as the actuarial advisor of 
the board and the executive director and may perform actuarial valuations and 
experience studies to supplement those performed by the actuary retained by the 
legislative commission on pensions and retirement. Any supplemental actuarial 
valuations or experience studies shall be filed with the executive director of 
the legislative commission on pensions and retirement. Copies of professional 
management survey reports shall be transmitted to the secretary of the senate, 
the chief clerk of the house of representatives, and the legislative reference 
library as provided by section 3.195, to the executive director of the 
commission and to the legislative auditor at the same time as reports are 
furnished to the board. Only management firms experienced in conducting 
management surveys of federal, state, or local public retirement systems shall 
be qualified to contract with the director hereunder; 
16B 16C. An approved actuary 
retained by the executive director shall function as the actuarial advisor of 
the board and the executive director and may perform actuarial valuations and 
experience studies to supplement those performed by the actuary retained by the 
legislative commission on pensions and retirement. Any supplemental actuarial 
valuations or experience studies shall be filed with the executive director of 
the legislative commission on pensions and retirement. Copies of professional 
management survey reports must be transmitted to the secretary of the senate, 
the chief clerk of the house of representatives, and the legislative reference 
library as provided by section 3.195, to the executive director of the 
commission and to the legislative auditor at the same time as reports are 
furnished to the board. Only management firms experienced in conducting 
management surveys of federal, state, or local public retirement systems are 
qualified to contract with the executive director; 
, or 16C or any law to the 
contrary, the board may use the services of the department of administration, 
information services division, for electronic data processing and related 
services or may contract for all or a portion of such services. 
and 
16B.06, 16C.03, subdivision 4, and 16C.06 do not 
apply to certificates of deposit and collateralization agreements executed by 
the covered pension plan under clause (1), item (ii). 
section 16B.06 sections 16C.03, subdivision 4, and 16C.06. 
section 16B.06 sections 16C.03, 
subdivision 4, and 16C.06. 
16B.19 16C.18. 
16B.19 16C.18. 
16B.19 16C.18 if the council 
or agency determines that at least three small targeted group businesses are 
likely to bid. 
16B.19 16C.18. The council or 
agency must establish a procedure for granting waivers from the subcontracting 
requirement when qualified small targeted group businesses are not reasonably 
available. The council or agency may establish financial incentives for prime 
contractors who exceed the goals for use of subcontractors and financial 
penalties for prime contractors who fail to meet goals under this paragraph. The 
subcontracting requirements of this paragraph do not apply to prime contractors 
who are small targeted group businesses. At least 75 percent of the value of the 
subcontracts awarded to small targeted group businesses under this paragraph 
must be performed by the business to which the subcontract is awarded or by 
another small targeted group business. 
16B.19 16C.18 when making purchases that are not subject to 
competitive bidding procedures. 
16B.19 to 16B.22 16C.18 to 
16C.21. The commission shall follow the rules promulgated by the 
commissioner of administration pursuant to section 16B.22 16C.21, and shall 
submit reports of the kinds required of the commissioners of administration and 
economic development by section 16B.21 16C.20. 
16B 16C or any other act inconsistent herewith or acts 
amendatory thereof or supplementary thereto, they shall direct the purchases of 
books, pamphlets, and documents therefor and the sales and exchanges therefrom 
upon such terms and conditions as they may deem just and proper. They may 
authorize the transfer of books and documents to the University of Minnesota or 
any department thereof, or to any state agency. They shall adopt rules for the 
government of the library and the management of its affairs, and prescribe 
penalties for the violation thereof. 
16B.06 16C.06, subdivision 6 7, to waive its sovereign 
immunity for purposes of claims of this liability; 
16B.06 16C.06, subdivision 6 7, to waive its sovereign 
immunity with respect to claims arising from this liability; 
and trails including 
limitation of right of access from the lands to adjacent highways and roads, 
flowage for development of fish and game resources, stream protection, flood 
control, and necessary appurtenances thereto, such conveyances to be made upon 
such terms and conditions including provision for reversion in the event of 
nonuser as the commissioner of natural resources may determine. 
TO MAY INCLUDE SNOW FENCES.] 
shall may be included in the 
easement so acquired the power to erect and maintain temporary snow fences as 
required upon lands adjoining the highway part of which lands have been taken 
for road purposes. If included, the right to erect 
; provided, that, if the state, or agency or political 
subdivision thereof, shall file with its petition, or at any time before the 
question of damages is submitted to a jury, a written disclaimer of its desire 
and intention to acquire a right to erect and maintain snow fences as to any 
particular tract of land involved, then no such right shall be acquired in such 
proceeding and no consideration given to such fences as an element of 
damage. 
The requests for 
specific service sign panels shall be renewed every three years. 
The commissioner may implement 
policies that apply only to signs on interstate highways in urban areas, such as 
distance requirements from the interstate for eligible services, priority 
issues, and mixing of service logos. 
25 
16 percent of the county turnback account must be 
expended on town road bridge structures that are ten feet or more in length and 
on town road culverts that replace existing town road bridges. In addition, if 
the present bridge structure is less than ten feet in length but a hydrological 
survey indicates that the replacement bridge structure or culvert must be ten 
feet or more in length, then the bridge or culvert is eligible for replacement 
funds. 
bridge structures and culverts may be on a matching basis, 
and if on a matching basis, not more than 90 percent of the cost of a bridge 
structure or culvert may be paid from the county turnback account and may be for 100 percent of the cost of the replacement 
structure or culvert or for 100 percent of the cost of rehabilitating the 
existing structure. 
a crossing gate is lowered 
warning of the immediate approach or passage of a railroad train; or 
(3) an approaching railroad 
train is plainly visible and is in hazardous proximity. 
each odd-numbered every third even-numbered year thereafter. Before final 
adoption of a revised plan, the commissioner shall hold a hearing to receive 
public comment on the preliminary draft of the 
revised plan. The revised state transportation plan must: 
and the transportation regulation board shall take no 
action inconsistent with the revised plan. 
or 
CREATED.] 
There is hereby created in the 
state treasury a fund to be known as the state airports fund to which shall be 
credited the proceeds of All taxes levied under sections 270.071 to 270.079 
and all other moneys which may be deposited to the credit 
thereof pursuant to any other provision of law. All moneys in the state airports 
fund are hereby appropriated to the commissioner of transportation for the 
purpose of acquiring, constructing, improving, maintaining, and operating 
airports and other air navigation facilities for the state, and to assist 
municipalities within the state in the acquisition, construction, improvement, 
and maintenance of airports and other air navigation facilities must be credited to the state airports fund created in 
section 360.017. 
SERVICES, COST REIMBURSEMENT SERVICE CHARGES.] 
all direct 
operating costs, including salaries and acquisition 
of excluding pilot salary and aircraft acquisition costs. All receipts for these services shall 
be deposited in the air transportation services account in the state airports 
fund and are appropriated to the commissioner to pay all these direct air service 
operating costs , including salaries. Receipts to cover the cost of acquisition of aircraft must 
be transferred and credited to the account or fund whose assets were used for 
the acquisition. 
in of the Twin Cities 
metropolitan area for commuter rail service. The commissioner shall perform the 
study in coordination with the metropolitan council and other affected metropolitan regional rail authorities and, affected metropolitan 
railroad companies, and the designated representatives of organized railroad 
employees. At least one representative of regional rail authorities, of railroad 
management, of operating craft employees, and of nonoperating craft employees 
shall serve on the policy formulation body and all other bodies of the study 
committee. Both employee members shall be selected by representatives of rail 
employees. The study committee shall consider, among other things, the 
positive and negative effects of commuter rail service on surrounding 
neighborhoods. 
the a road authorities authority, other than town boards 
and county boards, as to highways a highway already established and constructed shall furnish one substantial culvert to an abutting owner 
in cases where the culvert is necessary for, may 
grant by permit a suitable approach to such the highway. A town board shall 
furnish one substantial culvert to an abutting owner in cases where the culvert 
is necessary for suitable approach to a town road, provided that at any annual 
town meeting the electors of any town may by resolution authorize the town board 
to require that all or part of the costs of the furnishing of all culverts on 
the town roads of such town be paid by the abutting owner. A county board, by 
resolution, shall, before furnishing any culverts after August 1, 1975, 
establish The requesting abutting property owner 
shall pay for the cost and installation of any required culverts unless a road 
authority, other than the commissioner, adopts by resolution a policy for 
the furnishing of a culvert to an abutting owner when a culvert is necessary for 
suitable approach to a county and state-aid road, and such. The policy may 
include provisions for the payment of all or part of the costs of furnishing such culverts the culvert by 
the abutting landowner. 
on Route No. 104 as 
herein established at or near Washington Avenue in 
the city of Minneapolis. 
394 105 in the city of 
Minneapolis and extending in a northerly and westerly direction to a point on 
Route No. 62 easterly of the Great Northern Railway 
at or near the city of Coon Rapids. 
officials owner or official: 
specified owner or highway authorities authority shall 
inspect and inventory in accordance with these standards and furnish the 
commissioner with such data as may be necessary to maintain a central inventory. 
township town clerk, or the governing body of the municipality. 
The report shall contain recommendations for the correction of, or legal posting 
of load limits on any bridge or structure that is found to be understrength or 
unsafe. 
TOLL OTHER BRIDGES.] The owner of a toll bridge and the owner of a bridge described in subdivision 2, clause 
(e), shall certify to the commissioner, as prescribed by the commissioner, 
that inspections of the bridge have been made at regular intervals not to exceed 
two years. The certification shall be accompanied by a report of the inspection. 
The report shall contain recommendations for the correction of or legal posting 
of load limitations if the bridge is found to be understrength or unsafe. 
heretofore in force, issued, 
or promulgated by the public service commission, public 
utilities commission, or the department of transportation under authority of 
chapters 174A, 216A, 218, 219, and 221, and 222 remain and 
continue in force and effect until repealed, modified, or superseded by duly 
authorized orders or directives of the commissioner 
of transportation regulation board. To the extent allowed under federal law or regulation, 
rules adopted by the public service commission, public 
utilities commission or the department of transportation under authority of 
the following sections are transferred to the commissioner of transportation regulation board and continue in force and effect until 
repealed, modified, or superseded by duly authorized rules of the transportation regulation board commissioner: 
section 218.041 except rules 
related to the form and manner of filing railroad rates, railroad accounting 
rules, and safety rules; 
(2) section 219.40; 
(3) (2) rules relating to rates or tariffs, or the granting, 
limiting, or modifying of permits or certificates of convenience and necessity 
under section 221.031, subdivision 1; 
(4) (3) rules relating to the sale, assignment, pledge, or 
other transfer of a stock interest in a corporation holding authority to operate 
as a permit carrier as prescribed in section 221.151, subdivision 1, or a local 
cartage carrier under section 221.296, subdivision 8; 
(5) (4) rules relating to rates, charges, and practices 
under section 221.161, subdivision 4; and 
(6) (5) rules relating to rates, tariffs, or the granting, 
limiting, or modifying of permits under sections 221.121, 221.151, and 221.296 
or certificates of convenience and necessity under section 221.071. 
board commissioner shall review the transferred rules, orders, 
and directives and, when appropriate, develop and adopt new rules, orders, or 
directives within 18 months of July 1, 1985. 
EXEMPTION; EXEMPTIONS: CERTAIN MANUFACTURERS; COMMISSIONER OF TRANSPORTATION.] (a) Sections 574.26 to 574.32 do not apply to a 
manufacturer of public transit buses that manufactures at least 100 public 
transit buses in a calendar year. For purposes of this section, "public transit 
bus" means a motor vehicle designed to transport people, with a design capacity 
for carrying more than 40 passengers, including the driver. The term "public 
transit bus" does not include a school bus, as defined in section 169.01, 
subdivision 6. 
Persons that are unsuccessful in a 
separate selection must be included in the selection for the remaining 
licenses. 
this subdivision. paragraph (a); and 
7.0 6.8 percent of the lesser of the amount of the general 
education levy certified in the prior calendar year according to section 
124A.23, subdivision 2, or the difference between the amount of the total 
general fund levy certified in the prior calendar year and the sum of the 
amounts certified in the prior calendar year according to sections 124A.03, 
subdivision 2; 124.315, subdivision 4; 124.912, subdivisions 1, paragraph (2), 
2, and 3; 124.916, subdivisions 1, 2, and 3, paragraphs (4), (5), and (6); and 
124.918, subdivision 6; plus 
August September 15 of 
each year an unaudited financial statement data for the 
preceding fiscal year. This statement financial data shall be submitted on forms in the format 
prescribed by the commissioner. 
December 31 November 30 of the calendar year of the submission of 
the unaudited financial statement data, the district shall provide to the commissioner and state auditor an audited 
financial data for the preceding fiscal year. An audited financial statement 
prepared in a form which will allow comparison with and correction of material 
differences in the unaudited statement financial data shall be submitted to the commissioner and 
the state auditor by November 30. The audited financial statement must also 
provide a statement of assurance pertaining to uniform financial accounting and 
reporting standards compliance and a copy of the 
management letter submitted to the district by the school district's 
auditor. 
$170 
an amount equal to the product of the formula allowance 
according to section 124A.22, subdivision 2, times .0485, calculated without 
compensatory basic skills 
revenue, transportation sparsity revenue, and the transportation portion of the 
transition revenue adjustment, plus compensatory basic skills revenue as though the school were a school 
district. 
(a) In addition to the revenue 
under subdivision 1, a charter school providing transportation services shall 
receive general education aid for each pupil unit equal to the sum of $170 an amount equal to the 
product of the formula allowance according to section 124A.22, subdivision 2, 
times .0485, plus the transportation sparsity allowance for the school 
district in which the charter school is located, plus the transportation 
transition allowance for the school district in which the charter school is 
located. 
(b) For the first two years that a 
charter school is providing transportation services, the special programs 
transportation revenue equals the charter school's actual cost in the current 
school year for transportation services for children with disabilities under 
section 124.223, subdivisions 4, 5, 7, and 8. For the third year of 
transportation services and later fiscal years, the special programs 
transportation revenue shall be computed according to section 124.225, 
subdivision 14. 
actual pupil units served for the current school year times the sum of the 
state average debt redemption fund revenue plus capital revenue, according to 
section 124.91, per actual pupil unit served for the current fiscal year. 
compensatory basic skills 
revenue attributable to the pupil in the resident district. 
compensatory basic skills 
revenue attributable to the pupil in the nonresident district. 
compensatory basic skills 
revenue. 
$170 an 
amount equal to the product of the formula allowance according to section 
124A.22, subdivision 2, times .0485, plus the transportation sparsity 
allowance for the district, plus the transportation transition allowance for the 
district; times (2) the pupil units attributable to the pupil. 
(a) For fiscal years 1997 and 1998, the general education 
revenue for each district equals the sum of the district's basic revenue, 
compensatory education revenue, secondary sparsity revenue, elementary sparsity 
revenue, transportation sparsity revenue, total operating capital revenue, 
transition revenue, and supplemental revenue. 
(b) For fiscal year 1999 and 
thereafter, the general education revenue for each district equals the sum of 
the district's basic revenue, basic skills revenue, training and experience 
revenue, secondary sparsity revenue, elementary sparsity revenue, transportation 
sparsity revenue, total operating capital revenue, graduation standards implementation revenue, transition 
revenue, and supplemental revenue. 
$1,359,000,000 for fiscal year 
1998 and $1,385,500,000 for fiscal year 1999 and, $1,328,000,000 for fiscal 
year 2000, and $1,325,100,000 for fiscal year 2001, and later fiscal years. 
The general education tax rate may not be changed due to changes or corrections 
made to a district's adjusted net tax capacity after the tax rate has been 
established. If the levy target for fiscal year 1999 or 
fiscal year 2000 is changed by another law enacted during the 1997 or 1998 session, the commissioner shall reduce the general education levy target in this bill section by the amount of 
the reduction in the enacted law. 
revenue any increase 
in its compensatory revenue over the amount of compensatory revenue that would 
have been earned in fiscal year 1998, as calculated under section 124A.22, 
subdivision 13b, paragraph (c), clause (1), to each school building in the 
district where the children who have generated the revenue are served. 
education revenue per actual pupil unit and the range disparity in adjusted general education 
revenue among pupils and districts by computing the 
difference between the fifth and the ratio of the 
ninety-fifth percentiles percentile to the fifth percentile of adjusted general education 
revenue. The commissioner must provide that information to all school districts. 
education revenue as measured by the difference between the fifth and ratio of the ninety-fifth percentiles percentile to the 
fifth percentile increases in any year, the commissioner must propose a shall recommend to 
the legislature options for change in the general education formula that 
will limit the disparity in adjusted general education revenue to no more than the disparity for the 
previous school year. The commissioner must submit the proposal recommended options 
to the education committees of the legislature by January 15. 
Minnesota Statutes 1990, sections 
124A.02, subdivision 24; 124A.23, subdivisions 2 and 3; 124A.26, subdivisions 2 
and 3; 124A.27; 124A.28; and 124A.29, subdivision 2; and Minnesota Statutes 1991 
Supplement, sections 124A.02, subdivisions 16 and 23; 124A.03, subdivisions 1b, 
1c, 1d, 1e, 1f, 1g, 1h, and 1i; 124A.04; 124A.22, subdivisions 2, 3, 4, 4a, 4b, 
8, and 9; 124A.23, subdivisions 1, 4, and 5; 124A.24; 124A.26, subdivision 1; 
and 124A.29, subdivision 1, are repealed effective June 30, 1999; Laws 1991, 
chapter 265, article 7, section 35, is repealed. 
$5,000,000 $5,500,000 . . . . . 1999 
under up 
to age five three, and at 
local district discretion from age three to seven, who needs special 
instruction and services, as determined by the standards of the state board, 
because the child has a substantial delay or has an identifiable physical or 
mental condition known to hinder normal development is a child with a 
disability. 
and 
"Individualized education plan" 
means a written statement developed for a student eligible for special education 
and services pursuant to this section and section 602(a)(20) of part A of the 
Individuals with Disabilities Education Act, United States Code, title 20, 
section 1401(a). 
any other rules it deems necessary rules for instruction of children with a disability. 
These rules shall provide standards and procedures appropriate for the 
implementation of and within the limitations of subdivisions 3a and 3b. These 
rules shall also provide standards for the discipline, control, management and 
protection of children with a disability. The state board shall not adopt rules 
for pupils served in level 1, 2, or 3, as defined in 
Minnesota Rules, 
 primarily in 
the regular classroom establishing either case loads or the maximum number 
of pupils that may be assigned to special education teachers. The state board, 
in consultation with the departments of health and human services, shall adopt 
permanent rules for instruction and services for children under age five and 
their families. These rules are binding on state and local education, health, 
and human services agencies. The state board shall adopt rules to determine 
eligibility for special education services. The rules shall include procedures 
and standards by which to grant variances for experimental eligibility criteria. 
The state board shall, according to section 14.05, subdivision 4, notify a 
district applying for a variance from the rules within 45 calendar days of 
receiving the request whether the request for the variance has been granted or 
denied. If a request is denied, the board shall specify the program standards 
used to evaluate the request and the reasons for denying the request. 
, and conflict, appropriate due 
process hearing procedures and reduced court 
actions related to the delivery of special education instruction and services 
for students with disabilities; 
(5) (6) in accordance with recognized professional 
standards, testing and evaluation materials, and procedures utilized for the 
purposes of classification and placement of children with a disability are 
selected and administered so as not to be racially or culturally discriminatory; 
and 
(6) (7) the rights of the child are protected when the 
parents or guardians are not known or not available, or the child is a ward of 
the state. 
at least the following procedures for decisions 
involving identification, assessment, and educational placement of children with 
a disability: 
;. 
clause paragraph (e) at the district's initiative;. 
clause paragraph (a). The intent of the state is to encourage parties to resolve 
disputes through mediation or other form of alternative dispute resolution. A 
school district and a parent or guardian must participate in mediation using the 
mediation services of MNSEMS, which is free to both parties, unless 
clause paragraph (e), but 
must not be used to deny or postpone the opportunity of a parent or guardian to 
obtain a due process hearing. 
clause paragraph (e) shall be 
rendered not more than 45 calendar days from the date of the receipt of the 
request for the hearing, except that hearing officers may 
exclude from the 45 calendar days the time required for mediation under 
paragraph (c) and are encouraged to accelerate the timeline to 30 days for 
children birth through two whose needs change rapidly and require quick 
resolution of complaints. A hearing officer may not grant specific extensions of 
time beyond the 45-day period unless requested by either party for good cause 
shown on the record. The decision of the hearing officer shall be binding on all 
parties unless appealed to the commissioner by the parent; guardian; school 
board of the district where the child resides pursuant to clause (g) paragraph (h); and 
also in the case of children birth through two, by the county board. 
(g) (h) Any local decision issued pursuant to clauses paragraphs (e) and 
(f) may be appealed to the commissioner within 30 calendar days of receipt of 
that written decision, by the parent, guardian, or the school board of the 
district responsible for assuring that an appropriate program is provided in 
accordance with state board rules. The appealing party shall note the specific 
parts of the hearing decision being appealed. 
(h) (i) The decision of the hearing review officer shall be 
final unless appealed by the parent or guardian or school board to the Minnesota 
court of appeals or federal district court as provided by federal law. State 
judicial review shall be in accordance with chapter 14. 
(i) (j) The commissioner of children, families, and learning 
shall select an individual who has the qualifications enumerated in this 
paragraph to serve as the hearing review officer: 
(j) (k) In all appeals, the parent or guardian of the pupil 
with a disability or the district that is a party to the hearing may challenge 
the impartiality or competence of the proposed hearing review officer by 
applying to the hearing review officer. 
(k) (l) Pending the completion of proceedings pursuant to 
this subdivision, unless the district and the parent or guardian of the child 
agree otherwise, the child shall remain in the child's current educational 
placement and shall not be denied initial admission to school. 
(l) (m) The child's school district of residence, a resident 
district, and providing district shall receive notice of and may be a party to 
any hearings or appeals under this subdivision. 
(m) (n) A school district is not liable for harmless 
technical violations of this subdivision or rules implementing this subdivision 
if the school district can demonstrate on a case-by-case basis that the 
violations did not harm the student's educational progress or the parent or 
guardian's right to notice, participation, or due process. 
(n) (o) Within ten calendar days after appointment, the 
hearing officer shall schedule and hold a prehearing conference. At that 
conference, or later, the hearing officer may take any appropriate action that a 
court might take under Rule 16 of Minnesota Rules of Civil Procedure including, 
but not limited to, scheduling, jurisdiction, and listing witnesses including 
expert witnesses. 
(o) (p) A hearing officer or hearing review officer 
appointed under this subdivision shall be deemed to be an employee of the state 
under section 3.732 for the purposes of section 3.736 only. 
(p) (q) In order to be eligible for selection, hearing 
officers and hearing review officers shall participate in training and follow 
procedures as designated by the commissioner. 
(q) (r) The hearing officer may admit all evidence which 
possesses probative value, including hearsay, if it is the type of evidence on 
which reasonable, prudent persons are accustomed to rely in the conduct of their 
serious affairs. The hearing officer shall give effect to the rules of privilege 
recognized by law. Evidence which is incompetent, irrelevant, immaterial, or 
unduly repetitious shall be excluded. 
pursuant to under this 
section shall be denied provision of this instruction 
and service on a shared time basis consistent with 
section 124A.034, subdivision 2, because of attendance at attending a 
nonpublic school defined in section 123.932, subdivision 3. If a resident pupil 
with a disability attends a nonpublic school located within the district of 
residence, the district shall provide necessary transportation for that pupil 
within the district between the nonpublic school and the educational facility 
where special instruction and services are provided on a shared time basis. If a 
resident pupil with a disability attends a nonpublic school located in another 
district and if no agreement exists pursuant to under section 124A.034, subdivision 1 or 1a, for the provision of providing 
special instruction and services on a shared time basis to that pupil by the 
district of attendance and where the special instruction and services are 
provided within the district of residence, the district of residence shall 
provide necessary transportation for that pupil between the boundary of the 
district of residence and the educational facility. The district of residence 
may provide necessary transportation for that pupil between its boundary and the 
nonpublic school attended, but the nonpublic school shall pay the cost of 
transportation provided outside the district boundary. 
20 30 calendar days of the date the commissioner office of dispute 
resolution receives a parent's written request for mediation. The mediation 
process may not be used to delay a parent's right to a due process hearing. The 
resolution of the mediation is not binding on any party. 
(b) (d) The local primary agency may request mediation on 
behalf of involved agencies when there are disputes between agencies regarding 
responsibilities to coordinate, provide, pay for, or facilitate payment for 
early intervention services. 
during three school 
years. A district with an approved program may provide instruction and 
Public Law 
Number 94-142 United States Code, title 20, section 
33, in any matter that affects the identification, evaluation, placement, or 
change in placement of a pupil. The district must ensure the protection of a 
pupil's civil rights, provide equal educational opportunities, and prohibit 
discrimination. Failure to comply with this subdivision will at least cause a 
district to become ineligible to participate in the program. Notwithstanding 
rules of the state board of education, a pupil's rights under this section 
cannot be waived by the state board. 
pursuant to under this section if the 
district elects to provide pupil support services at a site other than the 
nonpublic school. Each request for pupil support services shall set forth 
the guidance and counseling or health services requested by or on behalf of all 
eligible nonpublic school pupils enrolled in a given nonpublic school. No 
district or intermediary service area shall expend an amount for these pupil 
support services which exceeds the amount allotted to it under this section. 
pursuant to under this section at a public school, a neutral site, 
the nonpublic school or any other suitable location. Guidance and counseling services may be provided to 
nonpublic school pupils pursuant to this section only at a public school or a 
neutral site. District or intermediary service area personnel and 
representatives of the nonpublic school pupils receiving pupil support services 
shall hold an annual consultation regarding the type of services, provider of 
services, and the location of the provision of these services. The district 
board or intermediary service area governing board shall make the final decision 
on the location of the provision of these services. 
at level 
4, 5, or 6 of the continuum of placement model described in Minnesota Rules, 
part 3525.0200 primarily in the regular 
classroom. 
(d) (e). 
1998 2000 and later fiscal 
years means the second fiscal year preceding the 
fiscal year for which aid will be paid. 
regular school fiscal year, 
whether the person is employed by one or more districts or a Minnesota correctional facility operating on a 
fee-for-service basis; 
school fiscal year, or a school district in which is located a Minnesota 
correctional facility operating on a fee-for-service basis for less than the 
full fiscal year, the commissioner may adjust the base revenue to reflect 
the expenditures that would have occurred during the base year had the program 
been operated for the full school fiscal year. 
provided, however, that 
special instruction and services for children with a disability required 
pursuant to section 120.17 may also be provided at a neutral site as defined in 
section 123.932, public school programs, excluding 
programs that provide instruction in core curriculum, may be provided to shared 
time pupils at a public school building, a neutral site, the nonpublic school, 
or any other suitable location. Guidance and counseling and diagnostic and 
health services required pursuant to under section 120.17 may also 
be provided at a nonpublic school building. As used in this subdivision, 
"diagnostic services" means speech, hearing, vision, psychological, medical and 
dental diagnostic services and "health services" means physician, nursing or 
optometric services provided to pupils in the field of physical and mental 
health. 
must be considered is a 
resident of the school district that enrolls the 
pupil in which the homeless shelter or other program, 
center, or facility assisting the homeless pupil or the pupil's family is 
located. 
21 22 and older who qualify under the graduation incentives 
program in section 126.22, subdivision 2, or those pupils 
who are eligible to receive special education services under section 120.17. 
and 
appropriate current 
educational program to any pupil, including exclusion, expulsion, and 
suspension. It does not include removal from class. 
shall may include a 
readmission plan. The readmission plan shall include, where appropriate, a 
provision for implementing alternative educational services upon readmission and may not be used to extend the current suspension. 
The school administration may not impose consecutive suspensions against the 
same pupil for the same course of conduct, or incident of misconduct, except 
where the pupil will create an immediate and substantial danger to self or to 
surrounding persons or property, or where the district is in the process of 
initiating an expulsion, in which case the school administration may extend the 
suspension up to a total 
of 15 days. In the case of a pupil with a disability, a suspension may not exceed ten school days school districts must comply with applicable federal 
law. The school administration shall implement alternative educational 
services to the extent that when the suspension exceeds five ten days. A separate 
administrative conference is required for each period of suspension. 
five ten school days of commencing an expulsion, exclusion, 
or a suspension. 
suspended, excluded, or expelled from school. The plan may include measures 
to improve the pupil's behavior and require parental involvement in the 
admission or readmission process, and may indicate the consequences to the pupil 
of not improving the pupil's behavior. 
may have 
been prejudiced because the administrative findings, inferences, conclusions, or 
decisions are: 
of 
evidence presented at the hearing. The commissioner shall issue a decision 
within 30 calendar days of receiving the entire record and the parties' written 
submission on appeal. The commissioner's decision shall be final and binding 
upon the parties after the time for appeal expires under section 127.33. 
before beginning exclusion or expulsion 
proceedings, and the reason for, the effective date, and the duration of the 
exclusion or expulsion. 
$591,000 $716,000 . . . . . 1999 
$532,000 $657,000 for 1999. 
$857,000 $982,000 . . . . . 1999 
$1,600,000 $1,725,000 . . . . . 1999 
(m) (n) "Part H state plan" means the annual state plan 
application approved by the federal government under the Individuals with 
Disabilities Education Act, United States Code, title 20, section 1471 et seq. 
(Part H, Public Law Number 102-119). 
(n) (o) "Pay for" means using federal, state, local, and 
private dollars available for early intervention services. 
(o) (p) "Respite" means short-term, temporary care provided 
to a child with a disability due to the temporary absence or need for relief of 
the family member or members or primary caregiver, normally providing the care. 
(p) (q) "State lead agency" means the state agency receiving 
federal funds under the Individuals with Disabilities Education Act, United 
States Code, title 20, section 1471 et seq. (Part H, Public Law Number 102-119). 
(q) (r) "Surrogate parent" means a person appointed by the 
local education agency to assure that the rights of the child to early 
intervention services are protected. A person cannot be a 
surrogate parent to a child for whom the person provides early intervention 
services. 
and economic security a 
representative from the state agency responsible for child care, and a 
representative from Indian health services or a tribal council. Section 15.059, 
subdivisions 2 to 5, apply to the council. The council shall meet at least 
quarterly. 
, the identification of 
unmet service needs identified on the individual family services plan and other 
individualized plans, and local, state, and federal policies impeding the 
implementation of this section. 
(a) For fiscal years 1995 and 1996, The state lead 
agency shall establish maintain a reserve account from federal sources to pay 
for services in dispute or to pay for early intervention services when local 
agencies have exhausted all other public and private funds available for Part H 
eligible children. 
(b) The lead agency shall report 
to the legislature by January 1, 1996, regarding county board expenditures for 
early intervention services and the continuing need and funding of the reserve 
account. 
September 1, 1997 May 1, 1998. 
service; and 
interest-bearing 
account, established by the commissioner through the higher education services 
office. A student may, upon graduation from high school, use the funds 
accumulated for the student toward the costs, including 
tuition, books, and lab fees, of attending a Minnesota post-secondary 
institution or participating in a Minnesota 
post-secondary program in a career training 
program. Funds accumulated for a student shall be available to the student 
from the time the student graduates from high school until ten years after the 
date the student entered the learn and earn graduation achievement program. 
After ten years, the commissioner shall close the student's account and any 
remaining money in the account shall revert to the general fund. 
service and cultural enrichment 
opportunities for students; maintain records regarding student completion of 
program component hours; and perform other administrative duties as necessary. A 
program coordinator must, to the extent possible, agree to remain with the 
program for four years to provide continuity of adult contact to the 
participating students. 
track follow participating 
students and the control group for a minimum of six years from the start of the 
program. The commissioner shall submit a preliminary report to the governor and 
the chairs of the senate and house committees having jurisdiction over education 
and crime prevention by December 15, 2000 2001, regarding continuation of the learn and earn 
graduation achievement program for participating schools and expansion of the 
program to additional schools. The commissioner shall submit a final report by 
December 15, 2002 2003. 
$11,617,000 $12,718,000 . . . . . 1998 
$11,596,000 $12,844,000 . . . . . 1999 
$10,437,000 $11,538,000 
for 1998. 
$1,159,000 $1,282,000 for 
1998 and $10,437,000 $11,562,000 for 1999. 
hearing public 
meeting at the nearest county seat in the area upon reasonable notice to the 
affected districts and county boards if requested within 20 days after 
submission of the plat. Such a hearing The public meeting may be requested by the board of any 
affected district, a county board of commissioners, or the petition of 20 
resident voters living within the area proposed for consolidation. The 
commissioner shall endorse on the plat action regarding any proposal for the 
disposition of the bonded debt of component districts and the reasons for these 
actions and within after a 
minimum of 20 days, but no more than 60 days of the date of the receipt of 
the plat, the commissioner shall return it to the county auditor who submitted 
it. The commissioner shall furnish a copy of that plat, and the supporting 
statement and its endorsement to the auditor of each county containing any land 
area of the proposed new district. If land area of a particular county was 
included in the plat, as submitted by the county auditor, and all of such land 
area is excluded in the plat as modified and approved, the commissioner shall 
also furnish a copy of the modified plat, supporting statement, and any 
endorsement to the auditor of such county. 
one four fiscal 
year years, or the time 
period set forth in this subdivision. Any agreement, part of an agreement, or 
other type of requirement to the contrary is void. 
either: 
100 percent of the equalizing 
factor as defined in section 124A.02, subdivision 8, for the year to which the 
levy is attributable $10,000. 
25 30 percent before March 
15, and a final payment of 15 10 percent by July 15 of the subsequent fiscal year. 
, up to $400,000; 
$4,030,000 $4,569,000 . . . . . 1998 
$4,052,000 $6,050,000 . . . . . 1999 
$3,646,000 $4,185,000 for 
1998. 
$405,000 $465,000 for 1998 
and $3,647,000 $5,585,000 
for 1999. 
school district, metropolitan or regional agency, or 
other political subdivision of this state excluding a 
school district, or employed under section 422A.03, may not exceed 95 
percent of the salary of the governor as set under section 15A.082, except as 
provided in this subdivision. Deferred compensation and payroll allocations to 
purchase an individual annuity contract for an employee are included in 
determining the employee's salary. Other forms of compensation which shall be 
included to determine an employee's total compensation are all other direct and 
indirect items of compensation which are not specifically excluded by this 
subdivision. Other forms of compensation which shall not be included in a 
determination of an employee's total compensation for the purposes of this 
subdivision are: 
, or school district may not include a provision for 
vacation or sick leave. The salary of an official covered by this subdivision 
may not be diminished because of the official's absence from official duties 
because of vacation or sickness. 
(a) (1) in any program where the resultant product, in 
excess of minimum requirements and at the pupil's option, becomes the personal 
property of the pupil; 
(b) (2) admission fees or charges for extra curricular 
activities, where attendance is optional and where the 
admission fees or charges a student must pay to attend or participate in an 
extracurricular activity is the same for all students, regardless of whether the 
student is enrolled in a public or a home school; 
(c) (3) a security deposit for the return of materials, 
supplies, or equipment; 
(d) (4) personal physical education and athletic equipment 
and apparel, although any pupil may personally provide it if it meets reasonable 
requirements and standards relating to health and safety established by the 
school board; 
(e) (5) items of personal use or products which a student 
has an option to purchase such as student publications, class rings, annuals, 
and graduation announcements; 
(f) (6) fees specifically permitted by any other statute, 
including but not limited to section 171.04, subdivision 1, clause (1); 
(g) (7) field trips considered supplementary to a district 
educational program; 
(h) (8) any authorized voluntary student health and accident 
benefit plan; 
(i) (9) for the use of musical instruments owned or rented 
by the district, a reasonable rental fee not to exceed either the rental cost to 
the district or the annual depreciation plus the actual annual maintenance cost 
for each instrument; 
(j) (10) transportation of pupils to and from extra 
curricular activities conducted at locations other than school, where attendance 
is optional; 
(k) (11) transportation of pupils to and from school for 
which aid for fiscal year 1996 is not authorized under Minnesota Statutes 1994, 
section 124.223, subdivision 1, and for which levy for fiscal year 1996 is not 
authorized under Minnesota Statutes 1994, section 124.226, subdivision 5, if a 
district charging fees for transportation of pupils establishes guidelines for 
that transportation to ensure that no pupil is denied transportation solely 
because of inability to pay; 
(l) (12) motorcycle classroom education courses conducted 
outside of regular school hours; provided the charge shall not exceed the actual 
cost of these courses to the school district; 
(m) (13) transportation to and from post-secondary 
institutions for pupils enrolled under the post-secondary enrollment options 
program under section 123.39, subdivision 16. Fees collected for this service 
must be reasonable and shall be used to reduce the cost of operating the route. 
Families who qualify for mileage reimbursement under section 123.3514, 
subdivision 8, may use their state mileage reimbursement to pay this fee. If no 
fee is charged, districts shall allocate costs based on the number of pupils 
riding the route. 
the position has been posted 
as a vacancy within the present teaching staff for a period of 30 days and no 
licensed coaches have applied for the position; 
(3) the person can verify 
completion of six quarter credits, or the equivalent, or 60 clock hours of 
instruction in first aid and the care and prevention of athletic injuries; and 
(4) the person (3) can verify completion of a coaching methods or 
theory course. 
, 
after annually posting the position as required in clause (2) and no licensed 
coach has applied for the position. 
currently under age 16 subject to 
compulsory instruction requirements under section 120.101, subdivisions 5 and 
5d, and is absent from school without lawful 
excuse, the officer may transport the child to the child's home and deliver the 
child to the custody of the child's parent or guardian, transport the child to 
the child's school of enrollment and deliver the child to the custody of a 
school superintendent or teacher or transport the child to a truancy service 
center under section 260A.04, subdivision 3. 
The grant recipient must match one local dollar for every 
state dollar received. The local match may include in kind contributions. In 
awarding grants, the commissioner shall consider which students will benefit 
most from these programs. No grant recipient shall use 
the grant award to supplant existing funding for gifted and talented 
programs. 
$150 $75 to $500 based on the 
student's score on the exams. The scholarships shall be awarded only to students 
who are enrolled in a Minnesota public or private college or university. The 
total amount of each scholarship shall be paid directly to the student's 
designated college or university and