Journal of the House - 12th Day - Monday, February 16, 2009

A quorum was present.

Anderson, B.; Benson; Cornish; Dill and Kahn were excused.

Wagenius was excused until 2:20 p.m.

The Chief Clerk proceeded to read the Journal of the preceding day. Koenen moved that further reading of the Journal be dispensed with and that the Journal be approved as corrected by the Chief Clerk. The motion prevailed.

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Sertich moved that the House recess subject to the call of the Chair. The motion prevailed.

RECESS

The House of Representatives recessed to hear the "Gettysburg Address" by former President Abraham Lincoln as portrayed by costumed historical interpreter Bryce Stenzel.

RECONVENED

The House reconvened and was called to order by the Speaker.

IN MEMORIAM

The members of the House paused for a moment of silence in memory of former Representative Sidney R. Mason of Duluth, Minnesota, who served from 1971-1972 and former Representative Dennis R. Newinski of Maplewood, Minnesota, who served from 1991-1992, both of whom recently passed away.

REPORTS OF STANDING COMMITTEES AND DIVISIONS

Hilstrom from the Committee on Public Safety Policy and Oversight to which was referred:

H. F. No. 130, A bill for an act relating to public safety; prohibiting predatory offenders required to register from accessing and using social networking Web sites; amending Minnesota Statutes 2008, sections 243.166, subdivisions 1a, 4; 244.05, subdivision 6.

Reported the same back with the following amendments:

Page 5, line 1, after the first comma, insert "or" and delete the second comma

With the recommendation that when so amended the bill pass and be re-referred to the Committee on Civil Justice.

The report was adopted.

Hilstrom from the Committee on Public Safety Policy and Oversight to which was referred:

H. F. No. 139, A bill for an act relating to domestic abuse; designating October as domestic violence awareness month in Minnesota; proposing coding for new law in Minnesota Statutes, chapter 10.

Reported the same back with the recommendation that the bill pass and be re-referred to the Committee on State and Local Government Operations Reform, Technology and Elections.

The report was adopted.

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Eken from the Committee on Environment Policy and Oversight to which was referred:

H. F. No. 250, A bill for an act relating to public health; protecting the health of children from toxic chemicals in products; requiring disclosure by manufacturers of children's products that contain chemicals of high concern; authorizing the Pollution Control Agency to designate priority chemicals of high concern and require replacement with safer alternatives; providing an exemption process; authorizing participation in an interstate clearinghouse; requiring reports to the legislature on implementation plans and comprehensive safe products framework; proposing coding for new law in Minnesota Statutes, chapter 325F.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

"Section 1. [116.9401] DEFINITIONS.

(a) For the purposes of sections 116.9401 to 116.9412, the following terms have the meanings given them.

(b) "Agency" means the Pollution Control Agency.

(c) "Alternative" means a substitute process, product, material, chemical, strategy, or combination of these that serves a functionally equivalent purpose to a chemical in a children's product.

(d) "Chemical" means a substance with a distinct molecular composition or a group of structurally related substances and includes the breakdown products of the substance or substances that form through decomposition, degradation, or metabolism.

(e) "Chemical of high concern" means a chemical identified on the basis of credible scientific evidence by a governmental entity or the United Nations' World Health Organization as being known or suspected with a high degree of probability to:

(1) harm the normal development of a fetus or child or cause other developmental toxicity;

(2) cause cancer, genetic damage, or reproductive harm;

(3) disrupt the endocrine or hormone system;

(4) damage the nervous system, immune system, or organs, or cause other systemic toxicity;

(5) be persistent, bioaccumulative, and toxic; or

(6) be very persistent and very bioaccumulative.

(f) "Child" means a person under 12 years of age.

(g) "Children's product" means a consumer product intended for use by children, such as baby products, toys, car seats, personal care products, and clothing, and includes packaging of food or beverage products intended for use by children under three years of age, but does not include food or pharmaceutical products, or a medical device as defined in the federal Food, Drug, and Cosmetic Act, United States Code, title 21, section 321(h).

(h) "Commissioner" means the commissioner of the Pollution Control Agency.

(i) "Distributor" means a person who sells consumer products to retail establishments on a wholesale basis.

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(j) "Green chemistry" means an approach to designing and manufacturing products in ways that minimize the use and generation of toxic substances.

(k) "Manufacturer" means any person who manufactures a final consumer product sold at retail or whose brand name is affixed to the consumer product. In the case of a consumer product imported into the United States, manufacturer includes the importer or domestic distributor of the consumer product if the person who manufactured or assembled the consumer product or whose brand name is affixed to the consumer product does not have a presence in the United States.

(l) "Priority chemical" means a chemical identified by the commissioner as a chemical of high concern that is contained in a children's product offered for sale in Minnesota and meets the criteria in section 116.9403.

(m) "Safer alternative" means an alternative whose potential to harm human health is less than that of a priority chemical that it could replace.

Sec. 2. [116.9402] IDENTIFICATION OF CHEMICALS OF HIGH CONCERN.

(a) By July 1, 2010, the agency shall, after consultation with the Department of Health, publish in the State Register and on the agency's Internet Web site a list of chemicals of high concern.

(b) The department must periodically review and revise the list of chemicals of high concern at least every three years. The department may add chemicals to the list if the chemical meets one or more of the criteria in section 116.9401, paragraph (e).

(c) The agency shall consider, among others, chemicals listed in the following sources for possible inclusion on the list of chemicals of high concern:

(1) chemicals identified as "Group 1 carcinogens" or "Group 2A carcinogens" by the United Nations' World Health Organization, International Agency for Research on Cancer;

(2) chemicals identified as "known to be a human carcinogen" and "reasonably anticipated to be a human carcinogen" by the secretary of the United States Department of Health and Human Services;

(3) chemicals identified as "Group A carcinogens" or "Group B carcinogens" by the United States Environmental Protection Agency;

(4) chemicals identified as reproductive or developmental toxicants by:

(i) the United States Department of Health and Human Services, National Toxicology Program, Center for the Evaluation of Risks to Human Reproduction; and

(ii) the California Environmental Protection Agency, Office of Environmental Health Hazard Assessment pursuant to the California Health and Safety Code, Safe Drinking Water and Toxic Enforcement Act of 1986, chapter 6.6, section 25249.8;

(5) chemicals identified as known or likely endocrine disruptors through screening or testing conducted in accordance with protocols developed by the United States Environmental Protection Agency pursuant to the federal Food, Drug, and Cosmetic Act, United States Code, title 21, section 346a(p), as amended by the federal Food Quality Protection Act, Public Law 104-170, or the federal Safe Drinking Water Act, United States Code, title 42, section 300j-17;

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(6) chemicals listed on the basis of endocrine-disrupting properties in Annex XIV, List of Substances Subject to Authorisation, Regulation (EC) No 1907/2006 of the European Parliament concerning the Registration, Evaluation, Authorisation, and Restriction of Chemicals;

(7) persistent, bioaccumulative, and toxic chemicals identified by:

(i) the state of Washington Department of Ecology in Washington Administrative Code, Chapter 173-333; or

(ii) the United States Environmental Protection Agency in Code of Federal Regulations, title 40, part 372; and

(8) a very persistent, very bioaccumulative chemical listed in Annex XIV, List of Substances Subject to Authorisation, Regulation (EC) No 1907/2006 of the European Parliament concerning the Registration, Evaluation, Authorisation, and Restriction of Chemicals.

(d) The agency may consider chemicals listed by another state as harmful to human health or the environment for possible inclusion in the list of chemicals of high concern.

Sec. 3. [116.9403] IDENTIFICATION OF PRIORITY CHEMICALS.

(a) The agency, after consultation with the Department of Health, may designate a chemical of high concern as a priority chemical if the agency finds that the chemical is contained in a children's product offered for sale in Minnesota, and:

(1) the chemical has been found through biomonitoring to be present in human blood, including umbilical cord blood, breast milk, urine, or other bodily tissues or fluids;

(2) the chemical has been found through sampling and analysis to be present in household dust, indoor air, drinking water, or elsewhere in the home environment;

(3) the chemical has been found through monitoring to be present in fish, wildlife, or the natural environment;

(4) the chemical has been identified as a high-production volume chemical by the United States Environmental Protection Agency; or

(5) the sale or use of the chemical or a product containing the chemical has been prohibited in another state within the United States.

(b) The agency shall designate at least five priority chemicals by January 1, 2011, and an additional five priority chemicals by January 1, 2013.

(c) By February 1, 2011, the agency shall publish a list of priority chemicals in the State Register and on the agency's Internet Web site and shall update the published list whenever a new priority chemical is designated.

Sec. 4. [116.9404] DISCLOSURE OF INFORMATION ON PRIORITY CHEMICALS.

Subdivision 1. Reporting of chemical use. Not later than 180 days after a priority chemical is identified under section 116.9403, any person who is a manufacturer or distributor of a children's product for sale in this state that contains a priority chemical shall notify the agency of that fact in writing unless the children's product is not subject to regulation under section 116.9408. This written notice must identify the product, the number of units sold or distributed for sale in this state or nationally during the previous calendar year, the priority chemical or chemicals contained in the product, and the intended purpose of the priority chemicals in the product.

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Subd. 2. Supplemental information. The manufacturer or distributor of a children's product that contains a priority chemical shall provide the following additional information if requested by the agency:

(1) information on the likelihood that the chemical will be released from the children's product to the environment during the children's product's lifecycle and the extent to which users of the children's product are likely to be exposed to the chemical;

(2) additional information regarding the potential for harm to human health from specific uses of the priority chemical; and

(3) an assessment of the availability, cost, feasibility, and performance, including potential for harm to human health of alternatives to the priority chemical and the reason the priority chemical is used in the manufacture of the children's product in lieu of identified alternatives. If an assessment acceptable to the agency is not timely submitted as determined by the agency, the agency may assess a fee on the manufacturer or distributor to cover the costs to prepare an independent report on the availability of safer alternatives by a contractor of the agency's choice.

Sec. 5. [116.9405] SAFER ALTERNATIVES TO PRIORITY CHEMICALS.

Subdivision 1. Replacement with safer alternative. A manufacturer or distributor of a children's product containing a priority chemical designated by the agency must:

(1) discontinue offering the product for sale in Minnesota;

(2) obtain a waiver from the commissioner under section 116.9407 in order to continue offering the product for sale in Minnesota; or

(3) replace the priority chemical with a safer alternative if the agency determines that a safer alternative is available and is a technically feasible replacement for the specific use in the children's product.

Subd. 2. Determination of safer alternative. Upon making a determination that a safer alternative is available for the specified use of the priority chemical in a product, the agency shall specify a reasonably expeditious timeline, not to exceed two years, by which date the priority chemical in the children's product sold in this state must be replaced with a safer alternative. In determining whether a safer alternative is available, the agency may, in the absence of persuasive evidence to the contrary, presume that:

(1) an alternative is a safer alternative if the alternative is not a chemical of high concern;

(2) a safer alternative is available if the sale of the children's product containing the priority chemical has been prohibited by another state within the United States;

(3) a safer alternative is available if the children's product containing the priority chemical is an item of apparel or a novelty; and

(4) a safer alternative is available if the alternative is sold in the United States.

Subd. 3. Compliance plan. No later than 180 days prior to the effective date of a prohibition adopted under section 116.9406, the manufacturer or distributor of a children's product that contains the priority chemical that is subject to the prohibition shall file a compliance plan with the commissioner or seek a waiver under section 116.9407. A compliance plan must:

(1) identify the children's product that contains the priority chemical;

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(2) specify whether compliance will be achieved by discontinuing the sale of the children's product in this state or by substituting a safer alternative in the product; and

(3) if compliance is achieved by substitution of a safer alternative in the product, identify the safer alternative and the timetable for substitution.

Sec. 6. [116.9406] PROHIBITION OF SALE.

Subdivision 1. Agency action against product containing priority chemical. The agency shall prohibit the sale or distribution in this state of a children's product containing a priority chemical if the department finds that:

(1) distribution of the children's product directly or indirectly exposes children to the priority chemical, and one or more safer alternatives to the priority chemical are available and are technically feasible substitutes for the specific use of the priority chemical in the product; or

(2) the manufacturer or distributor fails to provide the information required under section 116.9404 in a timely fashion.

Subd. 2. Notice of prohibition of sale. The agency shall notify a manufacturer or distributor of its decision to prohibit the offering for sale in this state of a product containing a priority chemical, unless the manufacturer or distributor has been granted a waiver under section 116.9407. The notice of prohibition of sale must contain the effective date of the prohibition, which must be at least 270 days after the date of the notice.

Subd. 3. Certificate of compliance. No less than 60 days prior to the effective date of the prohibition of sale determined under section 116.9405, a manufacturer or distributor must send to the agency, in writing, a certificate of compliance certifying that after the effective date of the prohibition, the manufacturer or distributor will not offer the product containing the priority chemical for sale in this state, and, if applicable, that compliance will be achieved through substitution of a safer alternative approved by the agency.

Subd. 4. Retailer notification. A manufacturer or distributor of a children's product issued a notice of prohibition of sale under subdivision 2 shall notify, in writing, persons that offer the product for sale or distribution in this state of the requirements of sections 116.9401 to 116.9411, and the effective date of the prohibition of sale. Notice under this subdivision must be issued within 30 days of the issuance of the notice of prohibition of sale, unless the manufacturer or distributor has applied for a waiver under section 116.9407, in which case the notice must be issued within 30 days of a permit denial by the commissioner.

Subd. 5. Sale of inventory. A retailer selling a children's product containing a priority chemical that is the subject of a prohibition issued under subdivision 1 may not offer the children's product for sale in this state after the effective date of the prohibition, except that a retailer may exhaust stocks present in the retailer's premises 90 days prior to the effective date of the prohibition, after providing evidence of that fact to the agency.

Subd. 6. Exceptions. A children's product containing a priority chemical designated by the agency may continue to be sold or offered for sale in this state if:

(1) the manufacturer or distributor obtains a waiver under section 116.9407; or

(2) in the commissioner's judgment, the lack of availability of the children's product could pose an unreasonable risk to public health, safety, or welfare.

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Sec. 7. [116.9407] WAIVER FOR SPECIFIC USES.

Subdivision 1. Application for waiver. The manufacturer or distributor of a children's product that contains a priority chemical and is subject to a prohibition under section 116.9406 may apply to the commissioner for a waiver for one or more specific uses of the priority chemical. The waiver application must, at a minimum:

(1) identify the specific children's product use or uses for which the waiver is sought;

(2) identify the alternatives considered for substitution of the priority chemical;

(3) explain the basis for concluding that the use of an alternative is not technically or economically feasible; and

(4) identify the steps that have and will be taken to minimize the use of the priority chemical.

Subd. 2. Term of waiver. The commissioner may grant a waiver with or without conditions upon finding that there are no technically or economically feasible alternatives for the use of the priority chemical in the children's product. Waivers may be granted for a term not to exceed four years and may be renewed for one or more additional four-year terms upon written application demonstrating that technically or economically feasible alternatives remain unavailable. The commissioner shall deny or grant waiver requests within 60 days after receipt of a completed waiver application.

Sec. 8. [116.9408] APPLICABILITY.

The requirements of sections 116.9401 to 116.9412 do not apply to:

(1) chemicals in used children's products;

(2) priority chemicals used in the manufacturing process, but that are not present in the final product;

(3) priority chemicals used in agricultural production;

(4) motor vehicles as defined in chapter 168 or watercraft as defined in chapter 86B or their component parts, except that the use of priority chemicals in detachable car seats is not exempt;

(5) priority chemicals generated solely as combustion by-products or that are present in combustible fuels; or

(6) retailers, unless that retailer knowingly sells a children's product containing a priority chemical after the effective date of its prohibition, of which that retailer has received prior notification from a manufacturer, distributor, or the state.

Sec. 9. [116.9409] DONATIONS TO THE STATE.

The commissioner may accept donations, grants, and other funds to carry out the purposes of sections 116.9401 to 116.9412. All such donations, grants, and other funds must be accepted without preconditions regarding the outcomes of the regulatory oversight processes set forth in sections 116.9401 to 116.9412.

Sec. 10. [116.9410] PARTICIPATION IN INTERSTATE CHEMICALS CLEARINGHOUSE.

The agency may participate in an interstate chemicals clearinghouse to promote safer chemicals in consumer products in cooperation with other states, including the classification of chemicals in commerce; organizing and managing available data on chemicals, including information on uses, hazards, and environmental and health concerns; and producing and evaluating information on safer alternatives to specific uses of chemicals of concern.

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Sec. 11. [116.9411] REPORTS.

(a) By January 15, 2010, the Pollution Control Agency shall report to the senate and house of representatives committees with jurisdiction over environment and natural resources, commerce, and public health regarding the department's plans for implementing the requirements of sections 116.9401 to 116.9408, and make recommendations for funding the implementation of those sections.

(b) By January 15, 2012, the Pollution Control Agency, in conjunction with the commissioner of human services and the commissioner of commerce, shall report to the senate and house of representatives committees with jurisdiction over environment and natural resources, commerce, and public health regarding recommendations to evaluate and regulate toxic chemicals in all consumer products and to promote and provide incentives for product design that uses principles of green chemistry and lifecycle analysis to protect public health and the environment.

Sec. 12. [116.9412] ENFORCEMENT.

The agency shall enforce sections 116.9401 to 116.9411 in the manner provided by sections 115.071, subdivisions 1 to 6, and 116.072.

Sec. 13. RULEMAKING.

The agency shall adopt rules under Minnesota Statutes, chapter 14, to implement the provisions of Minnesota Statutes, sections 116.9404 to 116.9408, no later than October 1, 2010.

Sec. 14. EFFECTIVE DATE.

Sections 1 to 13 are effective the day following final enactment."

Delete the title and insert:

"A bill for an act relating to public health; protecting the health of children from toxic chemicals in products; requiring disclosure by manufacturers of children's products that contain chemicals of high concern; authorizing the Pollution Control Agency to designate priority chemicals of high concern and require replacement with safer alternatives; prohibiting certain sales; providing a waiver process; authorizing participation in an interstate clearinghouse; requiring reports to the legislature on implementation plans and comprehensive safe products framework; proposing coding for new law in Minnesota Statutes, chapter 116."

With the recommendation that when so amended the bill pass and be re-referred to the Committee on Commerce and Labor.

The report was adopted.

Hilstrom from the Committee on Public Safety Policy and Oversight to which was referred:

H. F. No. 254, A bill for an act relating to public safety; requiring law enforcement to provide violent crime alerts to citizens who request notification; requiring crime alerts to be distributed in a format that disabled citizens can access; proposing coding for new law in Minnesota Statutes, chapter 611A.

Reported the same back with the following amendments:

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Delete everything after the enacting clause and insert:

"Section 1. [611A.0393] CRIME ALERTS; VIOLENT CRIMES; DISABLED ACCESS.

If a law enforcement agency provides a crime alert to citizens within its jurisdiction, the alerts and any accompanying documents must be in a form that a disabled person can access with commercially available text-based screen reader software. Any contact information provided by a citizen requesting a crime alert is classified as private data on individuals.

EFFECTIVE DATE. This section is effective August 1, 2009."

Delete the title and insert:

"A bill for an act relating to public safety; requiring crime alerts to be distributed in a format that disabled citizens can access; proposing coding for new law in Minnesota Statutes, chapter 611A."

With the recommendation that when so amended the bill pass and be re-referred to the Committee on Civil Justice.

The report was adopted.

Hornstein from the Transportation and Transit Policy and Oversight Division to which was referred:

H. F. No. 267, A bill for an act relating to traffic regulations; requiring restraint of child under age eight and shorter than four feet nine inches while passenger in motor vehicle; amending Minnesota Statutes 2008, section 169.685, subdivision 5.

Reported the same back with the following amendments:

Page 1, line 18, strike the second "may" and insert "must"

Page 1, line 19, strike "or the amount reduced"

Page 2, after line 5, insert:

"Sec. 2. Minnesota Statutes 2008, section 169.686, subdivision 1, is amended to read:

Subdivision 1. Seat belt requirement. (a) A properly adjusted and fastened seat belt, including both the shoulder and lap belt when the vehicle is so equipped, shall be worn by:

(1) the driver of a passenger vehicle or commercial motor vehicle;

(2) a passenger riding in the front seat of a passenger vehicle or commercial motor vehicle; and

(3) a passenger riding in any seat of a passenger vehicle who (i) is not required to be transported in a child passenger restraint system under section 169.685, subdivision 5, and (ii) is ~~older than three but~~ younger than 11 years of age.

(b) A person who is 15 years of age or older and who violates paragraph (a), clause (1) or (2), is subject to a fine of $25. The driver of the passenger vehicle or commercial motor vehicle in which the violation occurred is subject to a $25 fine for a violation of paragraph (a), clause (2) or (3), by a child of the driver under the age of 15 or any

Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 337

child under the age of 11. A peace officer may not issue a citation for a violation of this section unless the officer lawfully stopped or detained the driver of the motor vehicle for a moving violation other than a violation involving motor vehicle equipment. The Department of Public Safety shall not record a violation of this subdivision on a person's driving record.

EFFECTIVE DATE. This section is effective July 1, 2009, and applies to offenses committed on or after that date."

Amend the title as follows:

Page 1, line 3, before the semicolon, insert "and modifying seat belt requirements accordingly"

Correct the title numbers accordingly

With the recommendation that when so amended the bill pass and be re-referred to the Committee on Public Safety Policy and Oversight.

The report was adopted.

Otremba from the Committee on Agriculture, Rural Economies and Veterans Affairs to which was referred:

H. F. No. 280, A bill for an act relating to human services; requesting the commissioner of human services to resubmit for federal approval the elimination of depreciation add-back for self-employed farmers in MinnesotaCare.

Reported the same back with the recommendation that the bill pass and be re-referred to the Committee on Finance.

The report was adopted.

Thissen from the Committee on Health Care and Human Services Policy and Oversight to which was referred:

H. F. No. 328, A bill for an act relating to adoption; modifying provisions governing access to adoption records and original birth certificates; amending Minnesota Statutes 2008, sections 13.465, subdivision 8; 144.218, subdivision 1; 144.225, subdivision 2; 144.2252; 144.226, subdivision 1; 259.89, subdivision 1; 260C.317, subdivision 4; proposing coding for new law in Minnesota Statutes, chapter 144; repealing Minnesota Statutes 2008, sections 259.83, subdivision 3; 259.89, subdivisions 2, 3, 4.

Reported the same back with the following amendments:

Page 5, line 16, after the semicolon, insert "and"

Page 5, line 19, strike "; and" and insert a period

Page 5, strike lines 20 to 22

Page 5, line 27, delete "July" and insert "August"

With the recommendation that when so amended the bill pass and be re-referred to the Committee on Civil Justice.

The report was adopted.

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Mullery from the Committee on Civil Justice to which was referred:

H. F. No. 334, A bill for an act relating to creditor remedies; prohibiting prejudgment garnishment in certain circumstances; amending Minnesota Statutes 2008, sections 551.05, subdivisions 1a, 3, 4, by adding a subdivision; 571.71; 571.72, subdivision 4; 571.79; 571.912; 571.914, subdivisions 1, 2, 4; 571.93, subdivision 1; repealing Minnesota Statutes 2008, sections 551.05, subdivisions 5, 6; 571.914, subdivision 3.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

"Section 1. Minnesota Statutes 2008, section 550.143, is amended to read:

550.143 LEVY ON FUNDS AT A FINANCIAL INSTITUTION.

Subdivision 1. Procedure. When the sheriff is levying upon funds at a financial institution, this section must be complied with, in addition to the general provisions set forth in section 550.135.

Subd. 2. Disclosure form. Along with the writ of execution and the exemption notice described in subdivision 3, the sheriff shall serve upon the financial institution an execution disclosure form which must be substantially in the following form:

STATE OF MINNESOTA DISTRICT COURT

COUNTY OF....................................................................... ...................................................... JUDICIAL DISTRICT

........................................................... (Judgment Creditor)

Against

FINANCIAL INSTITUTIONS

............................................................. (Judgment Debtor) EXECUTION

DISCLOSURE

and

........................................................................ (Third Party)

On the ..... day of ............., ......., the time of service of execution herein, there was due and owing the judgment debtor from the third party the following:

(1) Money. Enter on the line below any amounts due and owing the judgment debtor, except earnings, from the third party.

...............................................................................................................................................................................................................

(2) Setoff. Enter on the line below the amount of any setoff, defense, lien, or claim which the third party claims against the amount set forth on line (1). State the facts by which such setoff, defense, lien, or claim is claimed. (Any indebtedness to a third party incurred by the judgment debtor within ten days prior to the receipt of the first execution levy on a debt is void as to the judgment creditor.)

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(3) Exemption. Enter on the line below any amounts or property claimed by the judgment debtor to be exempt from execution.

(4) Adverse Interest. Enter on the line below any amounts claimed by other persons by reason of ownership or interest in the judgment debtor's property.

5) Enter on the line below the total of lines (2), (3), and (4).

(6) Enter on the line below the difference obtained (never less than zero) when line (5) is subtracted from the amount on line (1).

(7) Enter on the line below 110 percent of the amount of the judgment creditor's claim which remains unpaid.

(8) Enter on the line below the lesser of line (6) and line (7). You are hereby instructed to remit this amount only if it is $10 or more.

AFFIRMATION

I, ....................... (person signing Affirmation), am the third party or I am authorized by the third party to complete this nonearnings disclosure, and have done so truthfully and to the best of my knowledge.

Dated: ................................................................................. ...............................................................................................

Signature

...............................................................................................

Title

...............................................................................................

Telephone Number

Subd. 3. Exemption notice. If the levy is on funds of a judgment debtor who is a natural person and if the funds to be levied are held on deposit at any financial institution, the judgment creditor or its attorney shall provide the sheriff with two copies of an exemption notice, which must be substantially in the form set forth below. The sheriff shall serve both copies of the exemption notice on the financial institution, along with the writ of execution. Failure of the sheriff to serve the exemption notices renders the levy void, and the financial institution shall take no action. However, if this subdivision is being used to execute on funds that have previously been garnished in compliance with section 571.71, the judgment creditor is not required to serve additional exemption notices. In that

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event, the execution levy shall only be effective as to the funds that were subject to the prior garnishment. Upon receipt of the writ of execution and exemption notices, the financial institution shall retain as much of the amount due under section 550.04 as the financial institution has on deposit owing to the judgment debtor, but not more than 110 percent of the amount remaining due on the judgment.

~~STATE OF MINNESOTA~~ ~~DISTRICT COURT~~

~~COUNTY OF.......................................................................~~ ~~...................................................... JUDICIAL DISTRICT~~

~~........................................................... (Judgment Creditor)~~

~~............................................................. (Judgment Debtor)~~

~~TO: Debtor~~ ~~EXEMPTION NOTICE~~

~~An order for attachment, garnishment summons, or levy of execution (strike inapplicable language) has been served on ............. (Bank or other financial institution where you have an account.)~~

~~Your account balance is $........~~

~~The amount being held is $........~~

~~However, all or a portion of the funds in your account will normally be exempt from creditors' claims if they are in one of the following categories:~~

(1) relief based on need. This includes the Minnesota Family Investment Program (MFIP), Emergency Assistance (EA), Work First Program, Medical Assistance (MA), General Assistance (GA), General Assistance Medical Care (GAMC), Emergency General Assistance (EGA), Minnesota Supplemental Aid (MSA), MSA Emergency Assistance (MSA-EA), Supplemental Security Income (SSI), and Energy Assistance;

~~(2) Social Security benefits (Old Age, Survivors, or Disability Insurance);~~

~~(3) unemployment benefits, workers' compensation, or veterans' benefits;~~

~~(4) an accident, disability, or retirement pension or annuity;~~

~~(5) life insurance proceeds;~~

~~(6) the earnings of your minor child and any child support paid to you; or~~

~~(7) money from a claim for damage or destruction of exempt property (such as household goods, farm tools, business equipment, a mobile home, or a car).~~

~~The following funds are also exempt:~~

~~(8) all earnings of a person in category (1);~~

~~(9) all earnings of a person who has received relief based on need, or who has been an inmate of a correctional institution, within the last six months;~~

~~Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 341~~

~~(10) 75 percent of every debtor's after tax earnings; and~~

~~(11) all of a judgment debtor's after tax earnings below 40 times the federal minimum wage.~~

~~TIME LIMIT ON EXEMPTIONS AFTER DEPOSIT IN BANK:~~

~~Categories (10) and (11): 20 days~~

~~Categories (8) and (9): 60 days~~

All others: no time limit, as long as funds are traceable to the exempt source. (In tracing funds, the first-in, first-out method is used. This means money deposited first is spent first.) The money being sought by the judgment creditor is being held in your account to give you a chance to claim an exemption.

~~TO CLAIM AN EXEMPTION:~~

Fill out, sign, and mail or deliver one copy of the attached exemption claim form to the institution which sent you this notice and mail or deliver one copy to the judgment creditor's attorney. In the event that there is no attorney for the judgment creditor, then the notice shall be sent directly to the judgment creditor. The address for the judgment creditor's attorney or the judgment creditor is set forth below. ~~Both copies must be mailed or delivered on the same day.~~

NOTE: You may help resolve your claim faster if you send to the creditor's attorney written proof or documents that show why your money is exempt. If you have questions regarding the documents to send as proof of an exemption, call the creditor's attorney. If you do not send written proof and the creditor's attorney has questions about your exemption claim, the creditor's attorney may object to your claim which may result in a further delay in releasing your exempt funds.

If the financial institution does not get the exemption claim back from you within 14 days of the date they mailed or gave it to you, they will be free to turn the money over to the sheriff or the judgment creditor. If you are going to claim an exemption, do so as soon as possible, because your money may be held until it is decided.

~~IF YOU CLAIM AN EXEMPTION:~~

~~(1) nonexempt money can be turned over to the judgment creditor or sheriff;~~

~~(2) the financial institution will keep holding the money claimed to be exempt; and~~

~~(3) seven days after receiving your exemption claim, the financial institution will release the money to you unless before then it receives an objection to your exemption claim.~~

~~IF THE JUDGMENT CREDITOR OBJECTS TO YOUR EXEMPTION CLAIM:~~

the institution will hold the money until a court decides if your exemption claim is valid, BUT ONLY IF the institution gets a copy of your court motion papers asserting the exemption WITHIN TEN DAYS after the objection is personally served on you, or within 13 days from the date the objection is mailed to you. You may wish to consult an attorney at once if the creditor objects to your exemption claim.

~~MOTION TO DETERMINE EXEMPTION:~~

At any time after your funds have been held, you may ask for a court decision on the validity of your exemption claim by filing a request for hearing which may be obtained at the office of the court administrator of the above court.

~~Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 342~~

~~PENALTIES:~~

If you claim an exemption in bad faith, or if the judgment creditor wrongly objects to an exemption in bad faith, the court may order the person who acted in bad faith to pay costs, actual damages, attorney fees, and an additional amount of up to $100.

~~...............................................................................................~~

~~Name and address of (Attorney for) Judgment Creditor~~

~~EXEMPTION:~~

~~(a) Amount of exemption claim.~~

~~/ / I claim ALL the funds being held are exempt.~~

~~/ / I claim SOME of the funds being held are exempt.~~

~~The exempt amount is $......................................................................................................................................................~~

~~(b) Basis for exemption.~~

~~Of the 11 categories listed above, I am in category number ............ (If more than one category applies, you may fill in as many as apply.) The source of the exempt funds is the following:~~

~~(If the source is a type of relief based on need, list the case number and county:~~

~~case number: ............................................. ;~~

~~county: ....................................................... )~~

I hereby authorize any agency that has distributed relief to me or any correctional institution in which I was an inmate to disclose to the above named creditor or its attorney only whether or not I am or have been a recipient of relief based on need or an inmate of a correctional institute within the last six months.

~~I have mailed or delivered a copy of the exemption notice to the judgment creditor or judgment creditor's attorney if represented at the address indicated above.~~

~~...............................................................................................~~

~~DEBTOR~~

~~Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 343~~

~~DATED: .............................................................................~~ ~~...............................................................................................~~

~~...............................................................................................~~

~~DEBTOR ADDRESS~~

~~...............................................................................................~~

~~DEBTOR TELEPHONE NUMBER~~

STATE OF MINNESOTA DISTRICT COURT

COUNTY OF....................................................................... ...................................................... JUDICIAL DISTRICT

.............................................................................. (Creditor)

................................................................................ (Debtor)

......................................................... (Financial institution)

IMPORTANT NOTICE

YOUR FUNDS HAVE BEEN LEVIED

The Creditor has frozen money in your account at your financial institution. The account is frozen for 14 days from the date of this notice.

Some of your money in your account may be protected (the legal word is exempt). You may be able to get it sooner than 14 days if you act quickly and follow the instructions on the next page.

The attached form lists some different sources of money in your account that are protected. If your money is from one or more of these sources, check the box on the form next to the sources of your money. If it is from one of these sources, the Creditor cannot take it.

BUT, you must follow the instructions and return the exemption form and copies of your bank statements from the last 60 days to have the bank unfreeze your money. If you do not follow the instructions or your creditor gets an order from the court or writ of execution, your financial institution will give the money to the Creditor. If that happens and it is protected, you can still get it back from the creditor later, but that is not as easy to do as filling in the form now.

See next pages for instructions and the exemption form.

Subd. 3a. Form of instructions. The instructions must be substantially in the following form:

INSTRUCTIONS

Note: The creditor is who you owe the money to. You are the debtor.

1. Fill out the attached exemption form in this packet.

If you check one of the boxes, you should also give proof that shows that some or all of the money in your account is from one or more of the protected sources. Creditors may ask for a hearing if they question your exemptions. To avoid a hearing:

Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 344

Case numbers should be added to the form. Copies of documents should be sent with the form.

NOTICE: You must send copies of your bank statements for the past 60 days before the garnishment. If you do not send bank statements with your exemption claim, the financial institution may release your money to the creditor.

2. Sign the exemption form. Make three copies. Keep one for yourself.

3. Mail or deliver the other copies of the form by (insert date).

BOTH COPIES MUST BE MAILED OR DELIVERED THE SAME DAY.

One copy of the form goes to:

(Insert name of creditor or creditor's attorney)

(Insert address of creditor or creditor's attorney)

One copy goes to:

(Insert name of bank)

(Insert address of bank)

HOW THE PROCESS WORKS

If You Do Not Send in the Exemption Form and Bank Statements:

14 days after the date of this letter some or all of your money may be turned over to the creditor or to the sheriff pursuant to Minnesota statute.

If You Send in the Exemption Form and Bank Statements:

Any money that is NOT protected can be turned over to the creditor or the sheriff.

If the Creditor Does Not Object:

The financial institution will unfreeze your money six business days after the institution gets your completed form.

If the Creditor Objects:

The money you have said is protected on the form will be held by the bank. The creditor has six business days to object (disagree) and ask the court to hold a hearing. You will receive a Notice of Objection and a Notice of Hearing.

The financial institution will hold the money until a court decides whether your money is protected or not.

Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 345

You may want to talk to a lawyer for advice about this process. If you are low income you can call Legal Aid.

PENALTIES:

If you claim that your money is protected and a court decides you made that claim in bad faith, the court can order you to pay costs, actual damages, attorney fees, and an additional amount of up to $100. For example, it may be bad faith if you claim you receive government benefits that you do not receive.

If the creditor made a bad faith objection to your claim that your money is protected, the court can order them to pay costs, actual damages, attorney fees, and an additional amount of up to $100.

Subd. 3b. Format of exemption form. The exemption form must be substantially in the following format:

EXEMPTION FORM

A. HOW MUCH MONEY IS PROTECTED

........ I claim ALL or SOME of the money being frozen by the bank is protected.

........ The amount I claim is protected is $.......

B. WHY THE MONEY IS PROTECTED

My money is protected because I get it from one or more of the following places:

(Check all that apply)

........ Government benefits

Government benefits include: MFIP - Minnesota family investment program, GA - general assistance, EA ‑ emergency assistance, MA - medical assistance, GAMC - general assistance medical care, EGA - emergency general assistance, MSA - Minnesota supplemental aid, MSA-EA - MSA emergency assistance, SSI - Supplemental Security Income, MinnesotaCare, Medicare part B premium payments, Medicare part D extra help, energy assistance.

LIST SOURCE(S) OF FUNDING IN YOUR ACCOUNT

LIST THE CASE NUMBER AND COUNTY

Case Number: ......................................................

County: .................................................................

........ Social Security benefits

........ Unemployment benefits

........ Workers' compensation

........ Veterans' benefits

Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 346

If you receive any of these government benefits, include copies of any documents you have that show you receive Social Security, unemployment, workers' compensation, or veterans' benefits.

........ Other assistance based on need

You may have assistance based on need from another source that is not on the list. If you do, check this box, and fill in the source of your money on the line below:

Source: ...............................................................................................................................................................................................

Include copies of any documents you have that show the source of this money.

........ All of your earnings (wages) because:

You get government benefits (see list of government benefits)

You currently receive other assistance based on need

You have received government benefits in the last six months

You were in jail or prison in the last six months

If you check this box, your wages are only protected for 60 days after they are deposited in your account so you MUST send the creditor a copy of BANK STATEMENTS that show what was in your account for the 60 days right before the bank froze your money.

........ Some of your earnings (wages)

If you did not check the box for all earnings, some of your earnings are still protected for 20 days after they were deposited in your account. The amount protected is the larger amount of:

75 percent of your wages (after taxes are taken out); or

(insert the sum of the current federal minimum wage) multiplied by 40.

The money from the following may also be exempt for 20 days after they are deposited in your account.

........ An accident, disability, or retirement pension or annuity

........ Payments to you from a life insurance policy

........ Earnings of your child who is under 18 years of age

........ Child support

........ Money paid to you from a claim for damage or destruction of property. Property includes household goods, farm tools or machinery, tools for your job, business equipment, a mobile home, a car, a musical instrument, a pew or burial lot, clothes, furniture, or appliances.

........ Death benefits paid to you.

I give permission to any agency that has given me cash benefits to give information about my benefits to the above-named creditor, or its attorney. The information will ONLY concern whether I get benefits or not, or whether I have gotten them in the past six months.

Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 347

If I was an inmate in the last six months, I give my permission to the correctional institution to tell the above-named creditor that I was an inmate there.

YOU MUST SIGN AND SEND THIS FORM BACK TO THE CREDITOR'S ATTORNEY AND THE BANK. FILL IN THE BLANKS BELOW AND GO BACK TO THE INSTRUCTIONS TO MAKE SURE YOU DO IT CORRECTLY.

I have mailed or delivered a copy of this form to:

(Insert name of creditor or creditor's attorney)

..................... …………………………………………………………………………………………………………………

(Insert address of creditor or creditor's attorney)

I have also mailed or delivered a copy of this exemption form to my bank at the address listed in the instructions.

DATED: ............................................. ...............................................................................................................................

DEBTOR

...............................................................................................................................

DEBTOR ADDRESS

...............................................................................................................................

DEBTOR TELEPHONE NUMBER

Subd. 4. Effect of exemption notice. Within two business days after receipt of the writ of execution and exemption notices, the financial institution shall serve upon the judgment debtor two copies of the exemption notice. The financial institution shall serve the notice by first class mail to the last known address of the judgment debtor. If no claim of exemption is received by the financial institution within 14 days after the exemption notices are mailed to the judgment debtor, the funds remain subject to the execution levy and shall be remitted to the sheriff within ~~seven~~ six business days. If the judgment debtor elects to claim an exemption, the judgment debtor shall complete the exemption notice, sign it under penalty of perjury, and deliver one copy to the financial institution and one copy to the attorney for the judgment creditor within 14 days of the date postmarked on the correspondence mailed to the debtor containing the exemption notices. The judgment debtor is also required to include copies of bank statements for the prior 60 days with the exemption notice. In the event that there is no attorney for the judgment creditor, then the notice must be sent directly to the judgment creditor. Failure of the judgment debtor to deliver the executed exemption notice or copies of the required bank statements for the prior 60 days does not constitute a waiver of any claimed right to an exemption. Upon timely receipt of a claim of exemption, funds not claimed to be exempt by the debtor remain subject to the execution levy. All money claimed to be exempt shall be released to the judgment debtor upon the expiration of ~~seven~~ six business days after the date postmarked on the envelope containing the executed exemption notice mailed to the financial institution, or the date of personal delivery of the executed exemption notice to the financial institution, unless within that time the judgment creditor interposes an objection to the exemption.

Subd. 5. Objection ~~to exemption claim~~ and request for hearing. An objection shall be interposed, within six business days of receipt by the creditor of an exemption claim from the debtor, by mailing or delivering one copy of the ~~written objection~~ Notice of Objection and Notice of Hearing to the financial institution and one copy of the ~~written objection~~ Notice of Objection and Notice of Hearing to the judgment debtor ~~along with a copy of the~~

~~Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 348~~

~~judgment debtor's claimed exemption form. Both copies of an objection to an exemption claim shall be mailed or delivered on the same date~~. The financial institution may rely on the date of mailing or delivery of a notice to it in computing any time periods in this section. The ~~written objection~~ Notice of Objection and Notice of Hearing must be substantially in the form specified in subdivision 7.

The court administrator may charge a fee of $1 for the filing of a Notice of Objection and Notice of Hearing. Upon the filing of a Notice of Objection and Notice of Hearing, the court administrator shall schedule the matter for hearing no sooner than five business days but no later than seven business days from the date of filing. A debtor may request continuance of the hearing by notifying the creditor and the court. The court shall schedule the continued hearing within seven days of the original hearing date.

An order stating whether the debtor's funds are exempt shall be issued by the court within three days of the date of the hearing.

Subd. 6. Duties of financial institution if objection is made to exemption claim. Upon receipt of a ~~written objection~~ Notice of Objection and Notice of Hearing from the ~~judgment~~ creditor or its attorney within the specified ~~seven-day~~ six-day period, the financial institution shall retain the funds claimed to be exempt. Unless the financial institution receives a request for hearing and notice of hearing from the judgment debtor asserting exemption rights within ten days after receipt of a written objection to the exemption, the funds remain subject to the execution levy as if no claim of exemption had been made and shall be remitted to the sheriff within seven days. If a request for hearing and notice of hearing to determine the validity of a claim of exemption is received by the financial institution within the period provided, it The financial institution shall retain the funds claimed to be exempt until otherwise ordered by the court, upon mutual agreement of the parties, or until the garnishment lapses pursuant to section 571.79.

Subd. 7. Form of Notice of Objection and Notice of Hearing. (a) The ~~written objection to the judgment debtor's claim of exemption~~ Written Objection and Notice of Hearing must be in substantially the following form:

~~STATE OF MINNESOTA~~ ~~DISTRICT COURT~~

~~COUNTY OF.......................................................................~~ ~~...................................................... JUDICIAL DISTRICT~~

~~........................................................... (Judgment Creditor)~~

~~OBJECTION~~

~~............................................................. (Judgment Debtor)~~ TO

~~EXEMPTION CLAIM~~

~~.................................................. (Garnishee) (Third Party)~~

The judgment creditor objects to your claim for exemption from garnishment, levy of execution, order for attachment (strike inapplicable language) for the following reason(s): ...................................................................................................................

Because of this objection, your financial institution will retain the funds you claimed to be exempt for an additional ten days. If you wish to request a hearing on your exemption claim, you need to do so within ten days from the date the objection was personally served on you, or within 13 days of the date the objection was mailed to you. You may request a hearing by completing the attached form and filing it with the court administrator.

~~Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 349~~

1. The court administrator's office shall provide clerical assistance to help with the writing and filing of a Request for Hearing by any person not represented by counsel. The court administrator may charge a fee of $1 for the filing of a Request for Hearing.

2. Upon the filing of a Request for Hearing, the court administrator shall schedule the matter for a hearing no later than five business days from the date of filing. The court administrator shall forthwith send a completed copy of the request, including the hearing date, time, and place to the adverse party and to the financial institution by first class mail.

3. If it is possible that the financial institution might not receive the request mailed from the court administrator within ten days, then you may want to personally deliver a copy of the request to the financial institution after you have filed your request with the court.

~~4. An order stating whether your funds are exempt shall be issued by the court within three days of the date of the hearing.~~

If you do not file a Request for Hearing within ten days of the date the objection was personally served on you, or within 13 days from the date the objection was mailed to you, your financial institution may turn your funds over to your creditor.

If you file a Request for Hearing and your financial institution receives it within ten days of the date it received this objection, your financial institution will retain your funds claimed to be exempt until otherwise ordered by the court.

~~...............................................................................................~~

~~Judgment Creditor or Attorney~~

STATE OF MINNESOTA DISTRICT COURT

COUNTY OF....................................................................... ...................................................... JUDICIAL DISTRICT

...............................................................................................

(Creditor) CREDITOR'S NOTICE OF

OBJECTION AND NOTICE OF

............................................................................................... HEARING ON EXEMPTION

(Debtor) CLAIM

...............................................................................................

(Financial Institution)

(DEBTOR)

...............................................................................................

ADDRESS

...............................................................................................

(CREDITOR OR CREDITOR'S ATTORNEY)

Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 350

...............................................................................................

This Notice of Objection and Notice of Hearing is made by the creditor objecting to your exemption claim. This hearing is to resolve your exemption claim.

Hearing Date: ...............................................................................................

Time: ...............................................................................................

Hearing Place: ...............................................................................................

The creditor objects to your claim of exemption from garnishment, levy of execution, order for attachment (strike inapplicable language) for the following reason(s):

(Note to both parties: Bring with you to the hearing all documents and materials relevant to the exemption claim. Failure to do so could delay the court's decision.)

If the creditor receives all documents and materials relevant to the exemption claim before the hearing date, the creditor may agree with your exemption claim and you can avoid a hearing.

Because a court hearing will be held on your claim that your funds are protected, your financial institution will retain the funds until it receives an order from the court.

~~Subd. 8.~~ ~~Request for hearing and notice for hearing.~~ ~~The request for hearing accompanying the objection notice must be in substantially the following form:~~

~~STATE OF MINNESOTA~~ ~~DISTRICT COURT~~

~~COUNTY OF ......................................................................~~ ~~...................................................... JUDICIAL DISTRICT~~

~~........................................................... (Judgment Creditor)~~

~~REQUEST FOR HEARING~~

~~............................................................. (Judgment Debtor)~~ ~~AND~~

~~NOTICE FOR HEARING~~

~~........................................................................ (Third Party)~~

~~I hereby request a hearing to resolve the exemption claim which has been made in this case regarding funds in the account of ............. (Judgment Debtor) at the ......... (Financial Institution).~~

~~I believe the property being held is exempt because~~

~~Dated: .................................................................................~~

Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 351

~~(JUDGMENT DEBTOR)~~

~~...............................................................................................~~

~~(ADDRESS)~~

~~...............................................................................................~~

~~(DEBTOR PHONE NUMBER)~~

~~...............................................................................................~~

~~HEARING DATE: ............................................................~~ ~~TIME: .................................................................................~~

~~HEARING PLACE: .........................................................~~

~~(Note to both parties: Bring with you to the hearing all documents and materials relevant to the exemption claim and objection. Failure to do so could delay the court's decision.)~~

Subd. 9. Release of funds. At any time during the procedure specified in this section, the judgment debtor or the judgment creditor may, by a writing dated after the service of the execution, direct the sheriff to release the funds in question to the other party. Upon receipt of a release, the sheriff shall release the funds as directed.

Subd. 10. Subsequent proceedings; bad faith claims. If in subsequent proceedings brought by the judgment debtor or the judgment creditor, the claim of exemption is not upheld, and the court finds that it was asserted in bad faith, the judgment creditor shall be awarded actual damages, costs, and reasonable attorney fees resulting from the additional proceedings, and an amount not to exceed $100. It is not considered bad faith for a judgment creditor to object to an improperly completed or incomplete exemption claim. If the claim of exemption is upheld, and the court finds that the judgment creditor disregarded the claim of exemption in bad faith, the judgment debtor shall be awarded costs, reasonable attorney fees, actual damages, and an amount not to exceed $100. The underlying judgment must be modified to reflect assessment of damages, costs, and attorney fees. However, if the party in whose favor a penalty assessment is made is not actually indebted to the party's attorney for fees, the attorney's fee award shall be made directly to the attorney and, if not paid, an appropriate judgment in favor of the attorney shall be entered. Upon motion of any party in interest, on notice, the court shall determine the validity of any claim of exemption, and may make any order necessary to protect the rights of those interested. No financial institution is liable for damages for complying with this section. Both copies of an exemption claim or an objection to an exemption claim must be mailed or delivered on the same date. The financial institution may rely on the date of mailing or delivery of a notice to it in computing any time periods in this section.

Sec. 2. Minnesota Statutes 2008, section 550.37, subdivision 14, is amended to read:

Subd. 14. Public assistance. All ~~relief~~ government assistance based on need, and the earnings or salary of a person who is a recipient of ~~relief~~ government assistance based on need, shall be exempt from all claims of creditors including any contractual setoff or security interest asserted by a financial institution. For the purposes of this chapter, ~~relief~~ government assistance based on need includes ~~MFIP, work first, general assistance medical care, supplemental security income, medical assistance, Minnesota supplemental assistance, and general assistance~~ but is not limited to Minnesota family investment program, general assistance medical care, Supplemental Security Income, medical assistance, MinnesotaCare, payment of Medicare part B premiums or receipt of part D extra help, diversionary work program, work participation cash benefit, Minnesota supplemental assistance, emergency Minnesota supplemental assistance, and general assistance, emergency general assistance, emergency assistance or county crisis funds, fuel assistance, and food support. The salary or earnings of any debtor who is or has been an eligible recipient of ~~relief~~ government assistance based on need, or an inmate of a correctional institution shall, upon the debtor's return to private employment or farming after having been an eligible recipient of ~~relief~~ government assistance based on need, or an inmate of a correctional institution, be exempt from attachment, garnishment, or levy

Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 352

of execution for a period of six months after the debtor's return to employment or farming and after all public assistance for which eligibility existed has been terminated. The exemption provisions contained in this subdivision also apply for 60 days after deposit in any financial institution, whether in a single or joint account. In tracing the funds, the first-in first-out method of accounting shall be used. The burden of establishing that funds are exempt rests upon the debtor. Agencies distributing ~~relief~~ government assistance and the correctional institutions shall, at the request of creditors, inform them whether or not any debtor has been an eligible recipient of ~~relief~~ government assistance based on need, or an inmate of a correctional institution, within the preceding six months.

Sec. 3. Minnesota Statutes 2008, section 551.05, is amended to read:

551.05 ATTORNEY'S SUMMARY EXECUTION UPON FUNDS AT A FINANCIAL INSTITUTION.

Subdivision 1. Procedure. When levying upon funds at a financial institution, this section must be complied with, in addition to the general provisions specified in section 551.04.

Subd. 1a. Exemption notice. If the writ of execution is being used by the attorney to levy funds of a judgment debtor who is a natural person and if the funds to be levied are held on deposit at any financial institution, the attorney for the judgment creditor shall serve with the writ of execution two copies of an exemption notice. The notice must be substantially in the form set forth below. Failure of the attorney for the judgment creditor to send the exemption notice renders the execution levy void, and the financial institution shall take no action. However, if this subdivision is being used to execute on funds that have previously been garnished in compliance with section 571.71, the attorney for judgment creditor is not required to serve an additional exemption notice. In that event, the execution levy shall only be effective as to the funds that were subject to the prior garnishment. Upon receipt of the writ of execution and exemption notices, the financial institution shall retain as much of the amount due under section 550.04 as the financial institution has on deposit owing to the judgment debtor, but not more than 100 percent of the amount remaining due on the judgment, or $10,000, whichever is less.

The notice informing a judgment debtor that an execution levy has been used to attach funds of the judgment debtor to satisfy a claim must be substantially in the following form:

~~STATE OF MINNESOTA~~ ~~DISTRICT COURT~~

~~County of............................................................................~~ ~~...................................................... JUDICIAL DISTRICT~~

~~........................................................... (Judgment Creditor)~~

~~............................................................... Judgment Debtor)~~

~~TO: Judgment Debtor~~ ~~EXEMPTION NOTICE~~

~~An order for attachment, garnishment summons, or levy of execution (strike inapplicable language) has been served on ............. (bank or other financial institution where you have an account).~~

~~Your account balance is $........~~

~~The amount being held is $........~~

~~However, all or a portion of the funds in your account will normally be exempt from creditors' claims if they are in one of the following categories:~~

~~Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 353~~

(1) relief based on need. This includes the Minnesota Family Investment Program (MFIP), Work First Program, Medical Assistance (MA), General Assistance (GA), General Assistance Medical Care (GAMC), Emergency General Assistance (EGA), Minnesota Supplemental Aid (MSA), MSA Emergency Assistance (MSA-EA), Supplemental Security Income (SSI), and Energy Assistance;

~~(2) Social Security benefits (Old Age, Survivors, or Disability Insurance);~~

~~(3) unemployment benefits, workers' compensation, or veterans' benefits;~~

~~(4) an accident, disability, or retirement pension or annuity;~~

~~(5) life insurance proceeds;~~

~~(6) the earnings of your minor child and any child support paid to you; or~~

~~(7) money from a claim for damage or destruction of exempt property (such as household goods, farm tools, business equipment, a mobile home, or a car).~~

~~The following funds are also exempt:~~

~~(8) all earnings of a person in category (1);~~

~~(9) all earnings of a person who has received relief based on need, or who has been an inmate of a correctional institution, within the last six months;~~

~~(10) 75 percent of every judgment debtor's after tax earnings; or~~

~~(11) all of a judgment debtor's after tax earnings below 40 times the federal minimum wage.~~

~~TIME LIMIT ON EXEMPTIONS AFTER DEPOSIT IN BANK:~~

~~Categories (10) and (11): 20 days~~

~~Categories (8) and (9): 60 days~~

~~TO CLAIM AN EXEMPTION:~~

Fill out, sign, and mail or deliver one copy of the attached exemption claim form to the institution which sent you this notice and mail or deliver one copy to the judgment creditor's attorney. The address for the judgment creditor's attorney is set forth below. ~~Both copies must be mailed or~~ ~~delivered on the same day.~~

~~NOTE: You may help resolve your claim faster if you send~~ to the creditor's attorney written proof or documents that show why your money is exempt. If you have questions regarding the documents to send as proof of an exemption, call the creditor's attorney. If you do not send written proof and the creditor's attorney has questions about your exemption claim, the creditor's attorney may object to your claim which may result in a further delay in releasing your exempt funds.

~~Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 354~~

If they do not get the exemption claim back from you within 14 days of the date they mailed or gave it to you, they will be free to turn the money over to the attorney for the judgment creditor. If you are going to claim an exemption, do so as soon as possible, because your money may be held until it is decided.

~~IF YOU CLAIM AN EXEMPTION:~~

~~(1) nonexempt money can be turned over to the judgment creditor or sheriff;~~

~~(2) the financial institution will keep holding the money claimed to be exempt; and~~

~~(3) seven days after receiving your exemption claim, the financial institution will release the money to you unless before then it receives an objection to your exemption claim.~~

~~IF THE JUDGMENT CREDITOR OBJECTS TO YOUR EXEMPTION CLAIM:~~

~~MOTION TO DETERMINE EXEMPTION:~~

~~PENALTIES:~~

~~...............................................................................................~~

~~Name and address of (Attorney for) Judgment Creditor~~

~~EXEMPTION:~~

~~(a) Amount of exemption claim.~~

~~/ / I claim ALL the funds being held are exempt.~~

~~/ / I claim SOME of the funds being held are exempt.~~

~~The exempt amount is $......................................................................................................................................................~~

~~(b) Basis for exemption.~~

~~Of the 11 categories listed above, I am in category number ............ (If more than one category applies, you may fill in as many as apply.) The source of the exempt funds is the following:~~

~~Journal of the House - 12th Day - Monday, February 16, 2009 - Top of Page 355~~

~~(If the source is a type of relief based on need, list the case number and county:~~

~~case number: ............................................. ;~~

~~county: ....................................................... )~~

I hereby authorize any agency that has distributed relief to me or any correctional institution in which I was an inmate to disclose to the above named judgment creditor's attorney only whether or not I am or have been a recipient of relief based on need or an inmate of a correctional institute within the last six months.

~~I have mailed or delivered a copy of the exemption notice to the judgment creditor's attorney at the address indicated above.~~

~~...............................................................................................~~

~~DEBTOR~~

~~DATED: .............................................................................~~ ~~...............................................................................................~~

~~...............................................................................................~~

~~DEBTOR ADDRESS~~

~~...............................................................................................~~

~~DEBTOR TELEPHONE NUMBER~~

STATE OF MINNESOTA DISTRICT COURT

COUNTY OF....................................................................... ...................................................... JUDICIAL DISTRICT

.............................................................................. (Creditor)

................................................................................ (Debtor)

......................................................... (Financial institution)

IMPORTANT NOTICE

YOUR FUNDS HAVE BEEN LEVIED

The Creditor has frozen money in your account at your financial institution. The account is frozen for 14 days from the date of this notice.

Some of your money in your account may be protected (the legal word is exempt). You may be able to get it sooner than 14 days if you act quickly and follow the instructions on the next page.

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See next pages for instructions and the exemption form.

Subd. 1a. Form of instructions. The instructions must be substantially in the following form:

INSTRUCTIONS

Note: The creditor is who you owe the money to. You are the debtor.

1. Fill out the attached exemption form in this packet.

Case numbers should be added to the form. Copies of documents should be sent with the form.

2. Sign the exemption form. Make three copies. Keep one for yourself.

3. Mail or deliver the other copies of the form by (insert date).

BOTH COPIES MUST BE MAILED OR DELIVERED THE SAME DAY.

One copy of the form goes to:

(Insert name of creditor or creditor's attorney)

(Insert address of creditor or creditor's attorney)

One copy goes to:

(Insert name of bank)

(Insert address of bank)

HOW THE PROCESS WORKS

If You Do Not Send in the Exemption Form and Bank Statements:

14 days after the date of this letter some or all of your money may be turned over to the creditor or to the sheriff pursuant to Minnesota statute.

If You Send in the Exemption Form and Bank Statements:

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Any money that is NOT protected can be turned over to the creditor or the sheriff.

If the Creditor Does Not Object:

The financial institution will unfreeze your money six business days after they get your completed form.

If the Creditor Objects:

The financial institution will hold the money until a court decides whether your money is protected or not.

You may want to talk to a lawyer for advice about this process. If you are low income you can call Legal Aid.

PENALTIES:

If the creditor made a bad faith objection to your claim that your money is protected, the court can order them to pay costs, actual damages, attorney fees, and an additional amount of up to $100.

Subd. 1b. Format of exemption form. The exemption form must be substantially in the following format:

EXEMPTION FORM

A. HOW MUCH MONEY IS PROTECTED

........ I claim ALL or SOME of the money being frozen by the bank is protected.

........ The amount I claim is protected is $.......

B. WHY THE MONEY IS PROTECTED

My money is protected because I get it from one or more of the following places:

(Check all that apply)

........ Government benefits

LIST SOURCE(S) OF FUNDING IN YOUR ACCOUNT

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LIST THE CASE NUMBER AND COUNTY

Case Number:........................................................................................................................................................................

County:...................................................................................................................................................................................

........ Social Security benefits

........ Unemployment benefits

........ Workers' compensation

........ Veterans' benefits

If you receive any of these government benefits, include copies of any documents you have that show you receive Social Security, unemployment, workers' compensation, or veterans' benefits.

........ Other assistance based on need

You may have assistance based on need from another source that is not on the list. If you do, check this box, and fill in the source of your money on the line below:

Source: ...............................................................................................................................................................................................

Include copies of any documents you have that show the source of this money.

........ All of your earnings (wages) because:

You get government benefits (see list of government benefits)

You currently receive other assistance based on need

You have received government benefits in the last six months

You were in jail or prison in the last six months

........ Some of your earnings (wages)

If you did not check the box for all earnings, some of your earnings are still protected for 20 days after they were deposited in your account. The amount protected is the larger amount of:

75 percent of your wages (after taxes are taken out); or

(insert the sum of the current federal minimum wage) multiplied by 40.

The money from the following may also be exempt for 20 days after they are deposited in your account.

........ An accident, disability, or retirement pension or annuity

........ Payments to you from a life insurance policy

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........ Earnings of your child who is under 18 years of age

........ Child support

........ Death benefits paid to you.

If I was an inmate in the last six months, I give my permission to the correctional institution to tell the above-named creditor that I was an inmate there.

YOU MUST SIGN AND SEND THIS FORM BACK TO THE CREDITOR'S ATTORNEY AND THE BANK. FILL IN THE BLANKS BELOW AND GO BACK TO THE INSTRUCTIONS TO MAKE SURE YOU DO IT CORRECTLY.

I have mailed or delivered a copy of this form to:

(Insert name of creditor or creditor's attorney)

(Insert address of creditor or creditor's attorney)

I have also mailed or delivered a copy of this exemption form to my bank at the address listed in the instructions.

DATED:............................................... ...............................................................................................................................

DEBTOR

...............................................................................................................................

DEBTOR ADDRESS

...............................................................................................................................

DEBTOR TELEPHONE NUMBER

Subd. 2. Effect of exemption notice. Within two business days after receipt of the execution levy and exemption notices, the financial institution shall serve upon the judgment debtor two copies of the exemption notice. The financial institution shall serve the notice by first class mail to the last known address of the judgment debtor. If no claim of exemption is received by the financial institution within 14 days after the exemption notices are mailed to the judgment debtor, the funds remain subject to the execution levy and shall be remitted to the judgment creditor's attorney within ~~seven~~ six business days. If the judgment debtor elects to claim an exemption, the judgment debtor shall complete the exemption notice, sign it under penalty of perjury, and deliver one copy to the financial institution and one copy to the attorney for the judgment creditor within 14 days of the date postmarked on the correspondence mailed to the judgment debtor containing the exemption notices. The debtor is also required to

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include copies of bank statements for the prior 60 days with the exemption notice. In the event that there is no attorney for the judgment creditor, the notice must be sent directly to the judgment creditor. Failure of the judgment debtor to deliver the executed exemption notice or copies of the required bank statements for the prior 60 days does not constitute a waiver of any claimed right to an exemption. Upon timely receipt of a claim of exemption, funds not claimed to be exempt by the judgment debtor remain subject to the execution levy. All money claimed to be exempt shall be released to the judgment debtor upon the expiration of ~~seven~~ six business days after the date postmarked on the envelope containing the executed exemption notice mailed to the financial institution, or the date of personal delivery of the executed exemption notice to the financial institution, unless within that time the attorney for the judgment creditor interposes an objection to the exemption.

Subd. 3. ~~Objection to exemption claim~~ Objections and request for hearing. An objection shall be interposed, within six business days of receipt by the creditor of an exemption claim from the debtor, by mailing or delivering one copy of the ~~written objection~~ Notice of Objection and Notice of Hearing to the financial institution and one copy of the ~~written objection~~ Notice of Objection and Notice of Hearing to the ~~judgment~~ debtor ~~along with a copy of the judgment debtor's claimed exemption form. Both copies of an objection to an exemption claim shall be mailed or delivered on the same date~~. The financial institution may rely on the date of mailing or delivery of a notice to it in computing any time periods in this section. The ~~written objection~~ Notice of Objection and Notice of Hearing forms must be substantially in the form ~~specified~~ set out in subdivision 5.

An order stating whether the debtor's funds are exempt shall be issued by the court within three days of the date of the hearing.

Subd. 4. Duties of financial institution if objection is made to exemption claim. Upon receipt of a ~~written objection~~ Notice of Objection and Notice of Hearing from the ~~judgment~~ creditor within the specified ~~seven-day~~ six-day period, the financial institution shall retain the funds claimed to be exempt. Unless the financial institution receives a request for hearing and notice of hearing from the judgment debtor asserting exemption rights within ten days after receipt of a written objection to the exemption, the funds remain subject to the execution levy as if no claim of exemption had been made and shall be remitted to the judgment creditor's attorney within seven days. If a request for hearing and notice of hearing to determine the validity of a claim of exemption is received by the financial institution within the period provided, it shall retain the funds claimed to be exempt until otherwise ordered by the court. The financial institution shall retain the funds claimed to be exempt until otherwise ordered by the court, upon mutual agreement of the parties, or until the garnishment lapses pursuant to section 571.79.

Subd. 5. Form of Notice of Objection and Notice of Hearing. ~~(a) The written objection to the judgment debtor's claim of exemption must be in substantially the following form:~~

~~STATE OF MINNESOTA~~ ~~DISTRICT COURT~~

~~County of ...........................................................................~~ ~~...................................................... JUDICIAL DISTRICT~~

~~........................................................... (Judgment Creditor)~~

~~OBJECTION TO~~

~~............................................................. (Judgment Debtor)~~ ~~EXEMPTION CLAIM~~

~~.................................................. (Garnishee) (Third Party)~~

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~~The judgment creditor objects to your claim for exemption from garnishment, levy of execution, order for attachment (strike inapplicable language) for the following reason(s):~~

Because of this objection, your financial institution will retain the funds you claimed to be exempt for an additional ten days. If you wish to request a hearing on your exemption claim, you need to do so within ten days from the date the objection was personally served on you, or within 13 days from the date the objection was mailed to you. You may request a hearing by completing the attached form and filing it with the court administrator.

~~4. An order stating whether your funds are exempt shall be issued by the court within three days of the date of the hearing.~~

~~...............................................................................................~~

~~Attorney for Judgment Creditor~~

(a) The Written Objection and Notice of Hearing must be in substantially the following form:

STATE OF MINNESOTA DISTRICT COURT

COUNTY OF....................................................................... ...................................................... JUDICIAL DISTRICT

...............................................................................................

(Creditor) CREDITOR'S NOTICE OF

OBJECTION AND NOTICE OF

............................................................................................... HEARING ON EXEMPTION

(Debtor) CLAIM

...............................................................................................

(Financial Institution)

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