House Journal 51st Day Tuesday April 18 2023

A quorum was present.

Kiel, McDonald and Neu Brindley were excused.

Koegel was excused until 1:40 p.m. Becker-Finn was excused until 1:50 p.m.

The Chief Clerk proceeded to read the Journal of the preceding day. There being no objection, further reading of the Journal was dispensed with and the Journal was approved as corrected by the Chief Clerk.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5358

REPORTS OF CHIEF CLERK

S. F. No. 10 and H. F. No. 10, which had been referred to the Chief Clerk for comparison, were examined and found to be not identical.

Lislegard moved that S. F. No. 10 be substituted for H. F. No. 10 and that the House File be indefinitely postponed. The motion prevailed.

REPORTS OF STANDING COMMITTEES AND DIVISIONS

Olson, L., from the Committee on Ways and Means to which was referred:

H. F. No. 24, A bill for an act relating to capital investment; modifying authority to ensure safe drinking water; modifying provisions of drinking water revolving fund; establishing grant program to replace lead drinking water service lines; requiring report; appropriating money; amending Minnesota Statutes 2022, sections 144.383; 446A.081, subdivisions 8, 9; proposing coding for new law in Minnesota Statutes, chapter 446A.

Reported the same back with the recommendation that the bill be placed on the General Register.

The report was adopted.

Olson, L., from the Committee on Ways and Means to which was referred:

S. F. No. 1955, A bill for an act relating to state government; establishing a budget for the Department of Agriculture, the Board of Animal Health, the Agricultural Utilization Research Institute, and the Office of Broadband Development; making policy and technical changes to agriculture provisions; making policy and technical changes to broadband provisions; providing civil penalties; appropriating money; requiring reports; transferring money to the border-to-border broadband fund account; creating the grain indemnity account; transferring money to the grain indemnity account; amending Minnesota Statutes 2022, sections 17.1016, subdivision 2; 17.133, subdivision 2; 28A.152, subdivision 2; 41A.14, subdivision 2; 41A.19; 116J.395, subdivision 7; 116J.396, subdivision 2; 223.16, by adding a subdivision; 223.17, subdivisions 6, 7, 7a; 223.175; 223.19; 232.22, subdivision 5; Laws 2021, First Special Session chapter 3, article 1, section 2, subdivision 5, as amended; Laws 2022, chapter 95, article 2, section 29, subdivision 6; proposing coding for new law in Minnesota Statutes, chapters 17; 116J; 223; repealing Minnesota Statutes 2022, sections 17.055, subdivision 2; 41A.12, subdivision 4; 41A.21; 223.17, subdivisions 4, 8; 232.22, subdivisions 4, 6, 6a, 7.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

"ARTICLE 1

APPROPRIATIONS

Section 1. AGRICULTURE APPROPRIATIONS.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5359

appropriations listed under them are available for the fiscal year ending June 30, 2024, or June 30, 2025, respectively. "The first year" is fiscal year 2024. "The second year" is fiscal year 2025. "The biennium" is fiscal years 2024 and 2025.

			APPROPRIATIONS
			Available for the Year
			Ending June 30
			2024	2025

Sec. 2. DEPARTMENT OF AGRICULTURE

Subdivision 1. Total Appropriation

$90,969,000

$73,029,000

Appropriations by Fund
	2024	2025
General	90,570,000	72,630,000
Remediation	399,000	399,000

The amounts that may be spent for each purpose are specified in the following subdivisions.

Subd. 2. Protection Services

Appropriations by Fund
	2024	2025
General	29,666,000	17,610,000
Remediation	399,000	399,000

(a) $399,000 the first year and $399,000 the second year are from the remediation fund for administrative funding for the voluntary cleanup program.

(b) $250,000 the first year and $250,000 the second year are for the soil health financial assistance program. The commissioner may use up to 6.5 percent of this appropriation for costs incurred to administer the program. This is a onetime appropriation. Any unencumbered balance does not cancel at the end of the first year and is available in the second year. Appropriations encumbered under contract on or before June 30, 2025, for soil health financial assistance grants are available until June 30, 2027.

(c) $2,500,000 the first year is for transfer to the pollinator research account established under Minnesota Statutes, section 18B.051.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5360

(d) $400,000 the first year and $400,000 the second year are for transfer to the noxious weed and invasive plant species assistance account established under Minnesota Statutes, section 18.89, to award grants to local units of government and Tribal Nations under Minnesota Statutes, section 18.90.

(e) $175,000 the first year and $175,000 the second year are for compensation for destroyed or crippled livestock under Minnesota Statutes, section 3.737. The first year appropriation may be spent to compensate for livestock that were destroyed or crippled during fiscal year 2023. If the amount in the first year is insufficient, the amount in the second year is available in the first year. The commissioner may use up to $5,000 each year to reimburse expenses incurred by university extension educators to provide fair market values of destroyed or crippled livestock. If the commissioner receives federal dollars to pay claims for destroyed or crippled livestock, an equivalent amount of this appropriation may be used to reimburse nonlethal prevention methods performed by federal wildlife services staff.

(f) $155,000 the first year and $155,000 the second year are for compensation for crop damage under Minnesota Statutes, section 3.7371. If the amount in the first year is insufficient, the amount in the second year is available in the first year. The commissioner may use up to $10,000 of the appropriation each year to reimburse expenses incurred by the commissioner or the commissioner's approved agent to investigate and resolve claims, as well as for costs associated with training for approved agents. The commissioner may use up to $40,000 of the appropriation each year to make grants to producers for measures to protect stored crops from elk damage. If the commissioner determines that claims made under Minnesota Statutes, section 3.737 or 3.7371, are unusually high, amounts appropriated for either program may be transferred to the appropriation for the other program.

(g) $5,000,000 the first year is for transfer to the grain indemnity account established under Minnesota Statutes, section 223.24.

(h) $825,000 the first year and $825,000 the second year are to replace capital equipment in the Department of Agriculture's analytical laboratory.

(i) $75,000 the first year and $75,000 the second year are to support a meat processing liaison position to assist new or existing meat and poultry processing operations in getting started, expanding, growing, or transitioning into new business models.

(j) $500,000 the first year and $500,000 the second year are for grants to organizations in Minnesota to develop enterprises, supply chains, and markets for continuous living cover crops and cropping systems in the early stages of commercial development. For the

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5361

purposes of this paragraph, "continuous living cover crops and cropping systems" refers to agroforestry, perennial biomass, perennial forage, perennial grains, and winter annual cereal grains and oilseeds that have market value as harvested or grazed commodities. The commissioner may use up to 6.5 percent of this appropriation for costs incurred to administer the program. This is a onetime appropriation.

(k) $1,126,000 the first year and $562,000 the second year are to identify and regulate pesticides containing perfluoroalkyl or polyfluoroalkyl substances.

(l) $100,000 the first year is to regulate systemic pesticide-treated seed.

(m) $65,000 the first year is for transfer to the commissioner of natural resources for a report on feral pigs and mink.

Subd. 3. Agricultural Marketing and Development

4,365,000

(a) $150,000 the first year and $150,000 the second year are to expand international trade opportunities and markets for Minnesota agricultural products. The base for this appropriation is $75,000 in fiscal year 2026 and $75,000 in fiscal year 2027.

(b) $186,000 the first year and $186,000 the second year are for transfer to the Minnesota grown account and may be used as grants for Minnesota grown promotion established under Minnesota Statutes, section 17.102. Notwithstanding Minnesota Statutes, section 16A.28, the appropriations encumbered under contract on or before June 30, 2025, for Minnesota grown grants in this paragraph are available until June 30, 2027.

(c) $634,000 the first year and $634,000 the second year are for continuation of the dairy development and profitability enhancement programs including dairy profitability teams and dairy business planning grants under Minnesota Statutes, section 32D.30.

(d) $200,000 the first year and $200,000 the second year are to award cooperative grants under Minnesota Statutes, section 17.1016. The commissioner may use up to six percent of the appropriation each year to administer the grant program.

(e) The commissioner may use funds appropriated in this subdivision for annual cost-share payments to resident farmers or entities that sell, process, or package agricultural products in this state for the costs of organic certification. The commissioner may allocate these funds for assistance to persons transitioning from conventional to organic agriculture.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5362

Subd. 4. Agriculture, Bioenergy, and Bioproduct Advancement

34,982,000

33,982,000

(a) $11,740,000 the first year and $10,740,000 the second year are for the agriculture research, education, extension, and technology transfer program under Minnesota Statutes, section 41A.14. Except as provided below, the appropriation each year is for transfer to the agriculture research, education, extension, and technology transfer account under Minnesota Statutes, section 41A.14, subdivision 3, and the commissioner shall transfer funds each year to the Board of Regents of the University of Minnesota for purposes of Minnesota Statutes, section 41A.14. To the extent practicable, money expended under Minnesota Statutes, section 41A.14, subdivision 1, clauses (1) and (2), must supplement and not supplant existing sources and levels of funding. The commissioner may use up to one percent of this appropriation for costs incurred to administer the program.

Of the amount appropriated for the agriculture research, education, extension, and technology transfer grant program under Minnesota Statutes, section 41A.14:

(1) $600,000 the first year and $600,000 the second year are for the Minnesota Agricultural Experiment Station's agriculture rapid response fund under Minnesota Statutes, section 41A.14, subdivision 1, clause (2);

(2) up to $1,000,000 the first year and up to $1,000,000 the second year are for research on avian influenza, salmonella, and other turkey-related diseases;

(3) $2,250,000 the first year and $2,250,000 the second year are for grants to the Minnesota Agricultural Education Leadership Council to enhance agricultural education with priority given to Farm Business Management challenge grants;

(4) $450,000 the first year and $450,000 the second year are for the cultivated wild rice breeding project at the North Central Research and Outreach Center to include a tenure track/research associate plant breeder;

(5) $350,000 the first year and $350,000 the second year are for potato breeding;

(6) $690,000 the first year and $690,000 the second year are to fund the Forever Green Initiative and protect the state's natural resources while increasing the efficiency, profitability, and productivity of Minnesota farmers by incorporating perennial and winter-annual crops into existing agricultural practices. The base for the allocation under this clause is $630,000 in fiscal year 2026 and thereafter;

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5363

(7) $1,000,000 the first year is to purchase and maintain equipment and physical infrastructure to support breeding, agronomic research, and food science activities of the Forever Green Initiative. The allocation in this clause is onetime; and

(8) $500,000 each year is for farm-scale winter greenhouse research and development coordinated by University of Minnesota Extension Regional Sustainable Development Partnerships. The allocation in this clause is onetime.

(b) The base for the agriculture research, education, extension, and technology transfer program is $10,180,000 in fiscal year 2026 and $10,180,000 in fiscal year 2027.

(c) $23,242,000 the first year and $23,242,000 the second year are for the agricultural growth, research, and innovation program under Minnesota Statutes, section 41A.12. Except as provided below, the commissioner may allocate this appropriation each year among the following areas: facilitating the start-up, modernization, improvement, or expansion of livestock operations, including beginning and transitioning livestock operations with preference given to robotic dairy-milking equipment; assisting value-added agricultural businesses to begin or expand, to access new markets, or to diversify, including aquaponics systems; facilitating the start-up, modernization, or expansion of other beginning and transitioning farms, including by providing loans under Minnesota Statutes, section 41B.056; sustainable agriculture on-farm research and demonstration; the development or expansion of food hubs and other alternative community-based food distribution systems; enhancing renewable energy infrastructure and use; crop research, including basic and applied turf seed research; Farm Business Management tuition assistance; and good agricultural practices and good handling practices certification assistance. The commissioner may use up to 6.5 percent of this appropriation for costs incurred to administer the program.

Of the amount appropriated for the agricultural growth, research, and innovation program under Minnesota Statutes, section 41A.12:

(1) $1,000,000 the first year and $1,000,000 the second year are for distribution in equal amounts to each of the state's county fairs to preserve and promote Minnesota agriculture;

(2) $6,750,000 the first year and $6,750,000 the second year are for incentive payments under Minnesota Statutes, sections 41A.16, 41A.17, 41A.18, and 41A.20. Of the amount allocated each year, $1,000,000 is to pay prior claims that were not fully paid. Notwithstanding Minnesota Statutes, section 16A.28, the first year appropriation is available until June 30, 2025, and the second year appropriation is available until June 30, 2026. If this appropriation

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5364

exceeds the total amount for which all producers are eligible in a fiscal year, the balance of the appropriation is available for other purposes under this paragraph. The base under this clause is $5,750,000 in fiscal year 2026 and thereafter and does not include funding to pay prior claims that were not fully paid;

(3) $3,000,000 the first year and $3,000,000 the second year are for grants that enable retail petroleum dispensers, fuel storage tanks, and other equipment to dispense biofuels to the public in accordance with the biofuel replacement goals established under Minnesota Statutes, section 239.7911. A retail petroleum dispenser selling petroleum for use in spark ignition engines for vehicle model years after 2000 is eligible for grant money under this clause if the retail petroleum dispenser has no more than 10 retail petroleum dispensing sites and each site is located in Minnesota. The grant money must be used to replace or upgrade equipment that does not have the ability to be certified for E25. A grant award must not exceed 65 percent of the cost of the appropriate technology. A grant award must not exceed $200,000 per station. The commissioner must cooperate with biofuel stakeholders in the implementation of the grant program. The commissioner, in cooperation with any economic or community development financial institution and any other entity with which the commissioner contracts, must submit a report on the biofuels infrastructure financial assistance program by January 15 of each year to the chairs and ranking minority members of the legislative committees and divisions with jurisdiction over agriculture policy and finance. The annual report must include but not be limited to a summary of the following metrics: (i) the number and types of projects financed; (ii) the amount of dollars leveraged or matched per project; (iii) the geographic distribution of financed projects; (iv) any market expansion associated with upgraded infrastructure; (v) the demographics of the areas served; (vi) the costs of the program; and (vii) the number of grants to minority-owned or female-owned businesses;

(4) $100,000 the first year and $100,000 the second year are for grants to facilitate the start-up, modernization, or expansion of copacking facilities, commercial kitchens, and other key supply chain infrastructure, such as shared cold-chain capacity. Money appropriated in this clause may also be used to assist value-added processors with food safety and environmental sustainability guideline planning and third-party certification services;

(5) $1,250,000 the first year and $1,250,000 the second year are for grants to facilitate the start-up, modernization, or expansion of meat, poultry, egg, and milk processing facilities. A grant award under this clause must not exceed $200,000. Any unencumbered balance at the end of the second year does not cancel until June 30, 2026, and may be used for other purposes under this paragraph. The base under this clause is $250,000 in fiscal year 2026 and thereafter;

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5365

(6) $1,000,000 the first year and $1,000,000 the second year are to develop and enhance farm-to-school markets for Minnesota farmers by providing more fruits, vegetables, meat, grain, and dairy for Minnesota children in schools and early childhood education centers, including, at the commissioner's discretion, reimbursing schools and early childhood education centers for purchases from local farmers;

(7) $1,000,000 the first year and $1,000,000 the second year are for urban youth agricultural education or urban agriculture community development;

(8) $500,000 the first year and $500,000 the second year are for the good food access program under Minnesota Statutes, section 17.1017; and

(9) $1,000,000 the first year and $1,000,000 the second year are to award and administer hemp fiber processing equipment grants under Minnesota Statutes, section 18K.10. The allocation in this clause is onetime.

Notwithstanding Minnesota Statutes, section 16A.28, any unencumbered balance does not cancel at the end of the first year and is available for the second year, and appropriations encumbered under contract on or before June 30, 2025, for agricultural growth, research, and innovation grants are available until June 30, 2028.

(d) The base for the agricultural growth, research, and innovation program is $16,079,000 in fiscal year 2026 and $16,079,000 in fiscal year 2027, and includes funding for incentive payments under Minnesota Statutes, sections 41A.16, 41A.17, 41A.18, and 41A.20.

Subd. 5. Administration and Financial Assistance

21,557,000

16,673,000

(a) $474,000 the first year and $474,000 the second year are for payments to county and district agricultural societies and associations under Minnesota Statutes, section 38.02, subdivision 1. Aid payments to county and district agricultural societies and associations must be disbursed no later than July 15 of each year. These payments are the amount of aid from the state for an annual fair held in the previous calendar year.

(b) $350,000 the first year and $350,000 the second year are for grants to the Minnesota Agricultural Education Leadership Council for programs of the council under Minnesota Statutes, chapter 41D.

(c) $1,425,000 the first year and $1,425,000 the second year are for transfer to the agricultural and environmental revolving loan account established under Minnesota Statutes, section 17.117, subdivision 5a, for low-interest loans under Minnesota Statutes, section 17.117.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5366

(d) $1,950,000 the first year and $1,950,000 the second year are for grants to Second Harvest Heartland on behalf of Minnesota's six Feeding America food banks for the following:

(1) to purchase milk for distribution to Minnesota's food shelves and other charitable organizations that are eligible to receive food from the food banks. Milk purchased under the grants must be acquired from Minnesota milk processors and based on low-cost bids. The milk must be allocated to each Feeding America food bank serving Minnesota according to the formula used in the distribution of United States Department of Agriculture commodities under The Emergency Food Assistance Program. Second Harvest Heartland may enter into contracts or agreements with food banks for shared funding or reimbursement of the direct purchase of milk. Each food bank that receives funding under this clause may use up to two percent for administrative expenses;

(2) to compensate agricultural producers and processors for costs incurred to harvest and package for transfer surplus fruits, vegetables, and other agricultural commodities that would otherwise go unharvested, be discarded, or be sold in a secondary market. Surplus commodities must be distributed statewide to food shelves and other charitable organizations that are eligible to receive food from the food banks. Surplus food acquired under this clause must be from Minnesota producers, processors, and food hubs. Second Harvest Heartland may use up to 15 percent of each grant awarded under this clause for administrative and transportation expenses; and

(3) to purchase and distribute protein products, including but not limited to pork, poultry, beef, dry legumes, cheese, and eggs to Minnesota's food shelves and other charitable organizations that are eligible to receive food from the food banks. Second Harvest Heartland may use up to two percent of each grant awarded under this clause for administrative expenses. Protein products purchased under the grants must be acquired from Minnesota processors, producers, and food hubs.

Of the amount appropriated under this paragraph, at least $850,000 each year must be allocated under clause (1) and at least $100,000 each year must be used to purchase eligible items from food hubs that aggregate food produced by emerging farmers. Notwithstanding Minnesota Statutes, section 16A.28, any unencumbered balance the first year does not cancel and is available in the second year. Second Harvest Heartland must submit quarterly reports to the commissioner and the chairs and ranking minority members of the legislative committees with jurisdiction over agriculture finance in the form prescribed by the commissioner. The reports must include but are not limited to information on the expenditure of funds, the amount of milk or other commodities purchased, and the organizations to which this food was distributed.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5367

(e) $100,000 the first year and $100,000 the second year are for grants to The Good Acre for the Local Emergency Assistance Farmer Fund program to compensate emerging farmers for crops donated to hunger relief organizations in Minnesota. This is a onetime appropriation.

(f) $25,000 the first year and $25,000 the second year are for grants to the Southern Minnesota Initiative Foundation to promote local foods through an annual event that raises public awareness of local foods and connects local food producers and processors with potential buyers.

(g) $400,000 the first year and $400,000 the second year are to expand the Emerging Farmer Office. The Emerging Farmer Office must engage and support emerging farmers regarding resources and opportunities available through the Department of Agriculture and throughout the state. For purposes of this paragraph, "emerging farmer" has the meaning given in Minnesota Statutes, section 17.055, subdivision 1. Of the amount appropriated each year, $25,000 is for translation services.

(h) $337,000 the first year and $337,000 the second year are for farm advocate services. Of the amount appropriated each year, $50,000 is for the continuation of the farmland transition programs and may be used for grants to farmland access teams to provide technical assistance to potential beginning farmers. Farmland access teams must assist existing farmers and beginning farmers with transitioning farm ownership and farm operation. Services provided by teams may include but are not limited to mediation assistance, designing contracts, financial planning, tax preparation, estate planning, and housing assistance.

(i) $260,000 the first year and $260,000 the second year are for a pass-through grant to Region Five Development Commission to provide, in collaboration with Farm Business Management, statewide mental health counseling support to Minnesota farm operators, families, and employees, and individuals who work with Minnesota farmers in a professional capacity. Region Five Development Commission may use up to 6.5 percent of the grant awarded under this paragraph for administration.

(j) $250,000 the first year and $250,000 the second year are to award and administer beginning farmer equipment and infrastructure grants under Minnesota Statutes, section 17.055.

(k) $150,000 the first year and $150,000 the second year are for administrative support for the Rural Finance Authority.

(l) $750,000 the first year and $750,000 the second year are to award and administer down payment assistance grants under Minnesota Statutes, section 17.133, to emerging farmers as defined

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5368

in Minnesota Statutes, section 17.055, subdivision 1. Notwithstanding Minnesota Statutes, section 16A.28, any unencumbered balance at the end of the first year does not cancel and is available in the second year and appropriations encumbered under contract by June 30, 2025, are available until June 30, 2027.

(m) $50,000 the first year is to provide technical assistance and leadership in the development of a comprehensive and well‑documented state aquaculture plan. The commissioner must provide the state aquaculture plan to the legislative committees with jurisdiction over agriculture finance and policy by February 15, 2025.

(n) $500,000 the first year and $500,000 the second year are for meat processing training and retention incentive grants under section 6. The commissioner may use up to 6.5 percent of this appropriation for costs incurred to administer the program. This is a onetime appropriation.

(o) $3,000,000 the first year is for Dairy Assistance, Investment, Relief Initiative (DAIRI) grants to Minnesota dairy farmers who enroll in coverage under a federal dairy risk protection program and produced no more than 25,000,000 pounds of milk in 2022. The commissioner must award DAIRI grants based on the amount of milk produced in 2022, up to 5,000,000 pounds per participating producer, at a rate determined by the commissioner within the limits of available funding. Notwithstanding Minnesota Statutes, section 16A.28, any unencumbered balance does not cancel at the end of the first year and is available the second year and any unencumbered balance at the end of the second year is available until June 30, 2026. The commissioner may use up to 6.5 percent of this appropriation for costs incurred to administer the program.

(p) $150,000 the first year and $150,000 the second year are for technical assistance grants to certified community development financial institutions that participate in United States Department of Agriculture loan or grant programs for small or emerging farmers, including but not limited to the Increasing Land, Capital, and Market Access Program. For purposes of this paragraph, "emerging farmer" has the meaning given in Minnesota Statutes, section 17.055, subdivision 1. The commissioner may use up to 6.5 percent of this appropriation for costs incurred to administer the program.

(q) $1,000,000 the first year is for transfer to the agricultural emergency account established under Minnesota Statutes, section 17.041.

(r) $1,584,000 the first year and $1,000,000 the second year are to support IT modernization efforts, including laying the technology foundations necessary to improve customer licensing and payment interactions with the department. This is a onetime appropriation.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5369

(s) $150,000 the first year and $150,000 the second year are to coordinate climate-related activities and services within the Department of Agriculture and counterparts in local, state, and federal agencies and to hire a full-time climate implementation coordinator. The climate implementation coordinator must coordinate efforts seeking federal funding for Minnesota's agricultural climate adaptation and mitigation efforts and develop strategic partnerships with the private sector and nongovernment organizations.

(t) $250,000 the first year is for a grant to the Board of Regents of the University of Minnesota to purchase equipment for the Veterinary Diagnostic Laboratory to test for chronic wasting disease, African swine fever, avian influenza, and other animal diseases. The Veterinary Diagnostic Laboratory must report expenditures under this paragraph to the legislative committees with jurisdiction over agriculture finance and higher education with a report submitted by January 3, 2024, and a final report submitted by September 1, 2025. The reports must include a list of equipment purchased, including the cost of each item.

(u) $2,500,000 the first year and $2,500,000 the second year are to maintain the current level of service delivery. The base for this appropriation is $3,011,000 in fiscal year 2026 and $3,011,000 in fiscal year 2027.

(v) $1,000,000 the first year and $1,000,000 the second year are for transfer to the Board of Regents of the University of Minnesota to evaluate, propagate, and maintain the genetic diversity of oilseeds, grains, grasses, legumes, and other plants including flax, timothy, barley, rye, triticale, alfalfa, orchard grass, clover, and other species and varieties that were in commercial distribution and use in Minnesota before 1970, excluding wild rice. This effort must also protect traditional seeds brought to Minnesota by immigrant communities. This appropriation includes funding for associated extension and outreach to small and Black, Indigenous, and People of Color (BIPOC) farmers. This is a onetime appropriation.

(w) The commissioner shall continue to increase connections with ethnic minority and immigrant farmers to farming opportunities and farming programs throughout the state.

Sec. 3. BOARD OF ANIMAL HEALTH

$6,613,000

$6,779,000

(a) $560,000 the first year and $560,000 the second year are for agricultural emergency preparedness and response. As part of the fiscal year 2024 and 2025 reports required under Minnesota Statutes, section 35.03, the Board of Animal Health must report the number of additional staff positions created under this paragraph, the number of full-time equivalent staff hired under this paragraph and their specific expertise and training, and the specific types of incidents and animal diseases for which the board is preparing.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5370

(b) $6,000 the first year and $6,000 the second year are for meeting expenses for the additional board members.

Sec. 4. AGRICULTURAL UTILIZATION RESEARCH INSTITUTE

$5,643,000

$4,343,000

(a) $300,000 the first year is for equipment upgrades, equipment replacement, installation expenses, and laboratory infrastructure at the Agricultural Utilization Research Institute's laboratories in the cities of Crookston, Marshall, and Waseca.

(b) $1,000,000 the first year is to replace analytical and processing equipment and make corresponding facility upgrades at Agricultural Utilization Research Institute facilities in the cities of Marshall and Waseca. This is a onetime appropriation and is available until June 30, 2026.

Sec. 5. Laws 2021, First Special Session chapter 3, article 1, section 2, subdivision 5, as amended by Laws 2022, chapter 95, article 1, section 1, subdivision 5, is amended to read:

Subd. 5. Administration and Financial Assistance

11,477,000

13,429,000

(a) $474,000 the first year and $474,000 the second year are for payments to county and district agricultural societies and associations under Minnesota Statutes, section 38.02, subdivision 1. Aid payments to county and district agricultural societies and associations shall be disbursed no later than July 15 of each year. These payments are the amount of aid from the state for an annual fair held in the previous calendar year.

(b) $387,000 the first year and $337,000 the second year are for farm advocate services. Of these amounts, $100,000 the first year and $50,000 the second year are for a pilot program creating farmland access teams to provide technical assistance to potential beginning farmers. The farmland access teams must assist existing farmers and beginning farmers on transitioning farm ownership and operation. Services provided by teams may include but are not limited to providing mediation assistance, designing contracts, financial planning, tax preparation, estate planning, and housing assistance. Of this amount for farm transitions, up to $50,000 the first year may be used to upgrade the Minnesota FarmLink web application that connects farmers looking for land with farmers looking to transition their land.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5371

(c) $47,000 the first year and $47,000 the second year are for grants to the Northern Crops Institute that may be used to purchase equipment. These are onetime appropriations.

(d) $238,000 the first year and $260,000 the second year are for a pass-through grant to Region Five Development Commission to provide, in collaboration with Farm Business Management, statewide mental health counseling support to Minnesota farm operators, families, and employees, and individuals who work with Minnesota farmers in a professional capacity. Region Five Development Commission may use up to 6.5 percent of the grant awarded under this paragraph for administration. The base for this appropriation is $260,000 in fiscal year 2024 and later.

(e) $1,700,000 the first year and $1,700,000 the second year are for grants to Second Harvest Heartland on behalf of Minnesota's six Feeding America food banks for the following:

(2) to compensate agricultural producers and processors for costs incurred to harvest and package for transfer surplus fruits, vegetables, and other agricultural commodities that would otherwise go unharvested, be discarded, or sold in a secondary market. Surplus commodities must be distributed statewide to food shelves and other charitable organizations that are eligible to receive food from the food banks. Surplus food acquired under this clause must be from Minnesota producers and processors. Second Harvest Heartland may use up to 15 percent of each grant awarded under this clause for administrative and transportation expenses; and

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5372

Of the amount appropriated under this paragraph, at least $600,000 each year must be allocated under clause (1). Notwithstanding Minnesota Statutes, section 16A.28, any unencumbered balance the first year does not cancel and is available in the second year. Second Harvest Heartland must submit quarterly reports to the commissioner and the chairs and ranking minority members of the legislative committees with jurisdiction over agriculture finance in the form prescribed by the commissioner. The reports must include but are not limited to information on the expenditure of funds, the amount of milk or other commodities purchased, and the organizations to which this food was distributed.

(f) $250,000 the first year and $250,000 the second year are for grants to the Minnesota Agricultural Education and Leadership Council for programs of the council under Minnesota Statutes, chapter 41D.

(g) $1,437,000 the first year and $1,437,000 the second year are for transfer to the agricultural and environmental revolving loan account established under Minnesota Statutes, section 17.117, subdivision 5a, for low-interest loans under Minnesota Statutes, section 17.117. The base for appropriations under this paragraph in fiscal year 2024 and thereafter is $1,425,000. The commissioner must examine how the department could use up to one-third of the amount transferred to the agricultural and environmental revolving loan account under this paragraph to award grants to rural landowners to replace septic systems that inadequately protect groundwater. No later than February 1, 2022, the commissioner must report to the legislative committees with jurisdiction over agriculture finance and environment finance on the results of the examination required under this paragraph. The commissioner's report may include other funding sources for septic system replacement that are available to rural landowners.

(h) $150,000 the first year and $150,000 the second year are for grants to the Center for Rural Policy and Development. These are onetime appropriations.

(i) $150,000 the first year is to provide grants to Central Lakes College for the purposes of designing, building, and offering credentials in the area of meat cutting and butchery that align with industry needs as advised by local industry advisory councils. Notwithstanding Minnesota Statutes, section 16A.28, any unencumbered balance does not cancel at the end of the first year and is available for the second year. The commissioner may only award a grant under this paragraph if the grant is matched by a like amount from another funding source. The commissioner must seek matching dollars from Minnesota State Colleges and Universities or other entities. The appropriation is onetime and is available until June 30, 2024. Any money remaining on June 30,

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5373

2024, must be transferred to the agricultural growth, research, and innovation program under Minnesota Statutes, section 41A.12, and is available until June 30, 2025. Grants may be used for costs including but not limited to:

(1) facility renovation to accommodate meat cutting;

(2) curriculum design and approval from the Higher Learning Commission;

(3) program operational start-up costs;

(4) equipment required for a meat cutting program; and

(5) meat handling start-up costs in regard to meat access and market channel building.

No later than January 15, 2023, Central Lakes College must submit a report outlining the use of grant money to the chairs and ranking minority members of the legislative committees and divisions with jurisdiction over agriculture and higher education.

(j) $2,000 the first year is for grants to the Minnesota State Poultry Association. This is a onetime appropriation. Notwithstanding Minnesota Statutes, section 16A.28, any unencumbered balance does not cancel at the end of the first year and is available for the second year.

(k) $17,000 the first year and $17,000 the second year are for grants to the Minnesota State Horticultural Society. These are onetime appropriations.

(l) $18,000 the first year and $18,000 the second year are for grants to the Minnesota Livestock Breeders Association. These are onetime appropriations.

(m) The commissioner shall continue to increase connections with ethnic minority and immigrant farmers to farming opportunities and farming programs throughout the state.

(n) $25,000 the first year and $25,000 the second year are for grants to the Southern Minnesota Initiative Foundation to promote local foods through an annual event that raises public awareness of local foods and connects local food producers and processors with potential buyers.

(o) $75,000 the first year and $75,000 the second year are for grants to Greater Mankato Growth, Inc., for assistance to agriculture-related businesses to promote jobs, innovation, and synergy development. These are onetime appropriations.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5374

(p) $75,000 the first year and $75,000 the second year are for grants to the Minnesota Turf Seed Council for basic and applied research. The Minnesota Turf Seed Council may subcontract with a qualified third party for some or all of the basic or applied research. No later than January 15, 2023, the Minnesota Turf Seed Council must submit a report outlining the use of the grant money and related accomplishments to the chairs and ranking minority members of the legislative committees with jurisdiction over agriculture. These are onetime appropriations. Any unencumbered balance does not cancel at the end of the first year and is available for the second year.

(q) $150,000 the first year and $150,000 the second year are to establish an emerging farmer office and hire a full-time emerging farmer outreach coordinator. The emerging farmer outreach coordinator must engage and support emerging farmers regarding resources and opportunities available throughout the Department of Agriculture and the state. For purposes of this paragraph, "emerging farmer" has the meaning provided in Minnesota Statutes, section 17.055, subdivision 1. Of the amount appropriated each year, $25,000 is for translation services for farmers and cottage food producers.

(r) $222,000 the first year and $286,000 the second year are to maintain the current level of service delivery.

(s) $827,000 the second year is to award and administer grants to:

(1) organizations to provide technical and culturally appropriate services to emerging farmers and related businesses;

(2) organizations to help emerging farmers pay for up to 65 percent of premium expenses each year up to two years under the federal micro farm insurance program; and

(3) The Good Acre for the Local Emergency Assistance Farmer Fund (LEAFF) program to compensate emerging farmers for crops donated to hunger relief organizations in Minnesota.

This is a onetime appropriation and is available until June 30, 2024.

(t) $750,000 the second year is to support the IT modernization efforts, including laying the technology foundations needed for improving customer interactions with the department for licensing and payments. The base for this appropriation is $584,000 in fiscal year 2024 and $0 in fiscal year 2025.

(u) $1,500,000 the first year is for transfer to the agricultural emergency account established under Minnesota Statutes, section 17.041. This is a onetime transfer. This transfer is in addition to the appropriations made in Laws 2022, chapter 47, section 2.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5375

Notwithstanding Minnesota Statutes, section 17.041, the commissioner may use the amount to be transferred for the purposes identified under Laws 2022, chapter 47, section 2, paragraph (b). This paragraph expires on December 31, 2022.

(v) $250,000 in the second year is for a grant to the Board of Regents of the University of Minnesota to purchase equipment for the Veterinary Diagnostic Laboratory to test for chronic wasting disease, African swine fever, avian influenza, and other animal diseases. The Veterinary Diagnostic Laboratory must report expenditures under this paragraph to the legislative committees with jurisdiction over agriculture finance and higher education with initial reports completed by January 3, 2023, and January 3, 2024, and a final report by September 1, 2025. The reports must include a list of equipment purchased, including the cost of each item. The base for this appropriation is $250,000 in fiscal year 2024 and $0 in fiscal year 2025.

(w) $141,000 the second year is for additional funding to administer the beginning farmer tax credit. The base for this appropriation is $56,000 in fiscal year 2024 and later.

(x) $750,000 the second year is for a grant to the Ag Innovation Campus to continue construction of a soybean processing and research facility. This is a onetime appropriation.

The commissioner shall submit a report on the utilization of the grants to the chairs and ranking minority members of the legislative committees and divisions with jurisdiction over agriculture policy and finance by February 1, 2024.

(y) $50,000 is added to the base for fiscal year 2024 and $0 for fiscal year 2025 to provide technical assistance and leadership in the development of a comprehensive and well-documented state aquaculture plan. The commissioner must provide the state aquaculture plan to the legislative committees with jurisdiction over agriculture finance and policy by February 15, 2025.

(z) $500,000 the second year is to award and administer down payment assistance grants under Minnesota Statutes, section 17.133. The base for this appropriation is $750,000 in fiscal year 2024 and thereafter. Notwithstanding Minnesota Statutes, section 16A.28, appropriations encumbered under contract by June 30, 2023, are available until June 30, 2025.

(aa) $350,000 the second year is to provide grants to secondary career and technical education programs for the purpose of offering instruction in meat cutting and butchery. By January 15, 2023, the commissioner must report to the chairs and ranking minority members of the committees with jurisdiction over agriculture finance and education finance by listing the grants

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5376

made under this paragraph by county and noting the number and amount of grant requests not fulfilled. The report may include additional information as determined by the commissioner, including but not limited to information regarding the outcomes produced by these grants. If additional grants are awarded under this paragraph that were not covered in the report due by January 15, 2023, the commissioner must submit an additional report to the chairs and ranking minority members of the committees with jurisdiction over agriculture finance and education finance regarding all grants issued under this paragraph by November 1, 2023. This is a onetime appropriation. Grants may be used for costs, including but not limited to:

(1) equipment required for a meat cutting program;

(2) facility renovation to accommodate meat cutting; and

(3) training faculty to teach the fundamentals of meat processing.

A grant recipient may be awarded a grant of up to $70,000 and may use up to ten percent of the grant for faculty training.

Priority may be given to applicants who are coordinating with meat cutting and butchery programs at Minnesota State Colleges and Universities system and local industry partners.

EFFECTIVE DATE. This section is effective the day following final enactment.

Sec. 6. GRANTS FOR MEAT PROCESSING TRAINING AND RETENTION INCENTIVES.

Subdivision 1. Definitions. (a) For the purposes of this section, the following terms have the meanings given.

(b) "Partner organizations" include:

(1) foundations engaged in economic development;

(2) community development financial institutions;

(3) federally recognized economic development districts; and

(4) community development corporations.

(c) "Small- to medium-sized meat and poultry processor" means a meat and poultry processor licensed by the state of Minnesota or the federal government that has fewer than 150 employees.

Subd. 2. Grants. (a) The commissioner of agriculture must provide grants to partner organizations to assist small- to medium-sized meat and poultry processors with hiring and training new employees. New employees at eligible meat and poultry processing plants may receive up to $10,000 in the form of tuition reimbursement for programs at Minnesota State Colleges and Universities, sign-on bonuses, relocation assistance, retention incentives, child care stipends, and other related expenses. Employees at any one meat or poultry processor may not receive more than $50,000 under this paragraph.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5377

(b) Up to 20 percent of a grant to a partner organization may be used for direct services to employees, including but not limited to translation services.

(c) Priority must be given to applications from partner organizations working in partnership with Minnesota State Colleges and Universities.

ARTICLE 2

AGRICULTURE STATUTORY CHANGES

Section 1. [17.033] LICENSE AND PERMIT SURCHARGES.

The commissioner may collect license and permit surcharges on all licensing and permitting transactions conducted by the Department of Agriculture for which a fee is charged. The surcharge applies to all initial and renewal license and permit applications and is calculated based on the license or permit base fee. Late penalties or other assessments are not included in the calculation of the surcharge. The fee is set at five percent beginning August 1, 2023, with a minimum fee of $5 for each transaction. The surcharge rate must be reviewed and set annually by the commissioner and may be assessed at a rate of between three and eight percent of the licensing or permitting fee, with a minimum fee of $5 for each transaction. The fees collected for this surcharge must be deposited in a dedicated account in the agricultural fund. Money in the account, including interest, is appropriated to the commissioner for the information technology improvement activities needed to create electronic systems for conducting licensing and permitting transactions and to modernize the department's inspection and customer management systems.

Sec. 2. Minnesota Statutes 2022, section 17.055, subdivision 1, is amended to read:

Subdivision 1. Emerging farmer working group. To advise the commissioner and legislature regarding the development and implementation of programs and initiatives that support emerging farmers in this state, the commissioner must periodically convene a working group consisting, to the extent possible, of persons who are, and organizations that represent, farmers or aspiring farmers who are women, veterans, persons with disabilities, American Indian or Alaskan Natives, members of a community of color, young, ~~and~~ lesbian, gay, bisexual, transgender, queer, intersex, or asexual (LGBTQIA+), or urban, and any other emerging farmers as determined by the commissioner. No later than January 15 each year, the commissioner must update the chairs and ranking minority members of the legislative committees and divisions with jurisdiction over agriculture regarding the working group's activities and recommendations.

Sec. 3. Minnesota Statutes 2022, section 17.055, is amended by adding a subdivision to read:

Subd. 2a. Emerging Farmers Office. The Emerging Farmers Office exists to support emerging farmers. For purposes of this subdivision, "emerging farmer" has the meaning given in subdivision 1. At a minimum, the office must coordinate the emerging farmer working group under subdivision 1 and the beginning farmer equipment and infrastructure grant program under subdivision 3.

Sec. 4. Minnesota Statutes 2022, section 17.055, is amended by adding a subdivision to read:

Subd. 3. Beginning farmer equipment and infrastructure grants. (a) The commissioner may award and administer equipment and infrastructure grants to beginning farmers. The commissioner shall give preference to applicants who are emerging farmers as defined in subdivision 1. Grant money may be used for equipment and infrastructure development.

(b) The commissioner shall develop competitive eligibility criteria and may allocate grants on a needs basis.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5378

Sec. 5. Minnesota Statutes 2022, section 17.055, is amended by adding a subdivision to read:

Subd. 4. Report. No later than February 1 each year, the commissioner must submit a report to the chairs and ranking minority members of the legislative committees and divisions with jurisdiction over agriculture regarding the emerging farmer working group's activities, recommendations, and any grants awarded under this section.

Sec. 6. Minnesota Statutes 2022, section 17.1016, subdivision 2, is amended to read:

Subd. 2. Grant program. (a) The commissioner may establish and implement a grant program to help farmers finance new cooperatives that organize for purposes of operating an agricultural product processing facility or marketing an agricultural product or agricultural service.

(b) To be eligible for this program, a grantee must:

(1) be a cooperative organized under chapter 308A or 308B;

(2) certify that all control ~~and equity in~~ of the cooperative is from farmers, family farm partnerships, family farm limited liability companies, or family farm corporations as defined in section 500.24, subdivision 2, who are actively engaged in agricultural commodity production;

(3) be operated primarily to process agricultural commodities or market agricultural products or services produced in Minnesota; ~~and~~

(4) receive agricultural commodities produced primarily by shareholders or members of the cooperative; and

(5) not allow nonpatron voting rights.

(c) The commissioner may receive applications and make grants up to $50,000 to eligible grantees for feasibility, marketing analysis, assistance with organizational development, financing and managing new cooperatives, product development, development of business and marketing plans, and predesign of facilities, including site analysis, the development of bid specifications, preliminary blueprints and schematics, and the completion of purchase agreements and other necessary legal documents.

(d) Grants must be matched dollar-for-dollar with other money or in-kind contributions.

Sec. 7. Minnesota Statutes 2022, section 17.116, subdivision 3, is amended to read:

Subd. 3. Awarding of grants. (a) Applications for grants must be made to the commissioner on forms prescribed by the commissioner.

(b) The applications must be reviewed, ranked, and recommended by a technical review panel appointed by the commissioner. The technical review panel shall consist of a soil scientist, an agronomist, a representative from a postsecondary educational institution, an agricultural marketing specialist, two resident farmers of the state using sustainable agriculture methods, two resident farmers of the state using organic agriculture methods, and a chair from the department.

(1) direct or indirect energy savings or production;

(2) environmental benefit;

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5379

(3) farm profitability;

(4) the number of farms able to apply the techniques or the technology proposed;

(5) the effectiveness of the project as a demonstration;

(6) the immediate transferability of the project to farms; and

(7) the ability of the project to accomplish its goals.

(d) The commissioner shall consider the recommendations of the technical review panel and may award grants for eligible projects. Priority must be given to applicants who are farmers or groups of farmers.

(e) Grants for eligible projects may not exceed $25,000 unless the portion above $25,000 is matched on an equal basis by the applicant's cash ~~or in-kind land use contribution.~~ contribution or the value of the applicant's in-kind land use, equipment use, or personal labor. Grant recipients who are not required to provide a match and grant recipients whose in-kind contributions exceed the amount needed to meet matching requirements may submit the value of the grant recipients' labor or equipment use as an expense eligible for payment from grant money. Grant funding of projects may not exceed $50,000 under this section, but applicants may utilize other funding sources. A portion of each grant must be targeted for public information activities of the project.

(f) A project may continue for up to three years. Multiyear projects must be reevaluated by the technical review panel and the commissioner before second or third year funding is approved. A project is limited to one grant for its funding.

Sec. 8. Minnesota Statutes 2022, section 17.133, subdivision 3, is amended to read:

Subd. 3. Report to legislature. No later than December 1, 2023, and annually thereafter, the commissioner must provide a report to the chairs and ranking minority members of the legislative committees having jurisdiction over agriculture and rural development, in compliance with sections 3.195 and 3.197, on the farm down payment assistance grants under this section. The report must include:

(1) background information on beginning farmers in Minnesota and any other information that the commissioner and authority find relevant to evaluating the effect of the grants on increasing opportunities for and the number of beginning farmers;

(2) the number and amount of grants;

(3) the geographic distribution of grants by county;

(4) the number of grant recipients who are emerging farmers;

(5) disaggregated data regarding the gender, race, and ethnicity of grant recipients;

~~(5)~~ (6) the number of farmers who cease to own land and are subject to payment of a penalty, along with the reasons for the land ownership cessation; and

~~(6)~~ (7) the number and amount of grant applications that exceeded the allocation available in each year.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5380

Sec. 9. [17.134] SOIL HEALTH FINANCIAL ASSISTANCE PROGRAM.

Subdivision 1. Establishment. The commissioner must establish and administer a program to support healthy soil management practices in accordance with this section.

Subd. 2. Eligible projects. The commissioner may award a grant under this section for any project on agricultural land in Minnesota that will:

(1) increase the quantity of organic carbon in soil through practices, including but not limited to reduced tillage, cover cropping, manure management, precision agriculture, crop rotations, and changes in grazing management;

(2) integrate perennial vegetation into the management of agricultural lands;

(3) reduce nitrous oxide and methane emissions through changes to livestock, soil management, or nutrient optimization;

(4) increase the usage of precision agricultural practices;

(5) enable the development of site-specific management plans; or

(6) enable the purchase of equipment, parts and materials, technology, subscriptions, technical assistance, seeds, seedlings, or amendments that will further any of the purposes in clauses (1) to (5).

Subd. 3. Grant eligibility. Any owner or lessee of farmland may apply for a grant under this section. Local government units, including cities, towns, counties, soil and water conservation districts, Tribal Nations, and joint powers boards, are also eligible for a grant. A local government unit that receives a grant for equipment or technology must make those purchases available for use by the public.

Sec. 10. Minnesota Statutes 2022, section 18B.01, subdivision 2b, is amended to read:

Subd. 2b. Bee owner. "Bee owner" means a person who owns ~~an apiary~~ a bee colony or colonies.

Sec. 11. Minnesota Statutes 2022, section 18B.01, is amended by adding a subdivision to read:

Subd. 2c. Bee kill incident. "Bee kill incident" means an acute pesticide poisoning of a bee colony or colonies located within one-half mile of each other at a single time point.

Sec. 12. Minnesota Statutes 2022, section 18B.01, is amended by adding a subdivision to read:

Subd. 18a. Pesticide-treated seed. "Pesticide-treated seed" means seed that has a pesticide directly applied to the seed before planting and is classified by the United States Environmental Protection Agency as a treated article under Code of Federal Regulations, title 40, section 152.25(a), and exempt from regulation under the federal Insecticide, Fungicide, and Rodenticide Act.

Sec. 13. Minnesota Statutes 2022, section 18B.01, is amended by adding a subdivision to read:

Subd. 30b. Systemic pesticide. "Systemic pesticide" means a pesticide designed to be absorbed by plants and translocated throughout plant tissue. Systemic pesticides include:

(1) acetamiprid, dinotefuran, clothianidin, thiamethoxam, imidacloprid, nitenpyram, thiacloprid, fipronil, flupyradifurone, sulfoxaflor, cyantraniliprole, or chlorantraniliprole; and

(2) any other pesticide determined by the commissioner to be a systemic pesticide, including any chemical belonging to the neonicotinoid or anthranilic diamide class.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5381

Sec. 14. Minnesota Statutes 2022, section 18B.03, subdivision 1, is amended to read:

Subdivision 1. Administration by commissioner. The commissioner shall administer, implement, and enforce this chapter and the Department of Agriculture is the lead state agency for the regulation of pesticides and pesticide‑treated seed. The commissioner has the sole regulatory authority over the terrestrial application of pesticides, including, but not limited to, the application of pesticides to agricultural crops, structures, and other nonaquatic environments. Except as provided in subdivision 3, a state agency other than the Department of Agriculture shall not regulate or require permits for the terrestrial or nonaquatic application of pesticides.

Sec. 15. Minnesota Statutes 2022, section 18B.04, is amended to read:

18B.04 PESTICIDE IMPACT ON ENVIRONMENT.

(a) The commissioner shall:

(1) determine the impact of pesticides and pesticide-treated seed on the environment, including the impacts on surface water and groundwater in this state;

(2) develop best management practices involving pesticide or pesticide-treated seed distribution, storage, handling, use, and disposal; and

(3) cooperate with and assist other state agencies and local governments to protect public health, pollinators, and the environment from harmful exposure to pesticides.

(b) The commissioner may assemble a group of experts under section 16C.10, subdivision 2, to consult in the investigation of pollinator deaths or illnesses. The group of experts may include representatives from local, state, and federal agencies; academia, including the University of Minnesota; the state pollinator bank; or other professionals as deemed necessary by the commissioner. The amount necessary for the purposes of this paragraph, not to exceed $100,000 per fiscal year, is appropriated from the pesticide regulatory account in section 18B.05.

Sec. 16. Minnesota Statutes 2022, section 18B.051, is amended to read:

18B.051 POLLINATOR RESEARCH ACCOUNT.

Subdivision 1. Account established. A pollinator research account is established in the agricultural fund. Money in the account, including interest, is appropriated to the Board of Regents of the University of Minnesota for pollinator research and outreach, including, but not limited to~~, science-based best practices and the identification and establishment of habitat beneficial to pollinators.~~:

(1) the identification and establishment of habitat beneficial to pollinators;

(2) the development and promotion of science-based best management practices;

(3) the development and promotion of practices that can reduce the effects of pesticides on pollinators;

(4) the effects of seed treatments on pollinators; and

(5) the development and promotion of integrated pest management, including pest economic thresholds.

The University of Minnesota must select projects in consultation with the Minnesota Department of Agriculture.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5382

Subd. 2. Expiration. This section expires July 1, ~~2025~~ 2027.

Sec. 17. [18B.052] SYSTEMIC PESTICIDE-TREATED SEED.

Subdivision 1. Systemic pesticide-treated seed program. The commissioner must develop a program for systemic pesticide-treated seed and do the following:

(1) develop guidance on appropriate use of systemic pesticide-treated seeds in Minnesota;

(2) collaborate with the University of Minnesota and other interested parties to evaluate national and international research on efficacy of seed treatment rates, scouting techniques, pest pressures, economic thresholds, and planting or other technology to determine their applicability to Minnesota-specific conditions;

(3) identify the research needs and projects that may be funded to help identify the times and locations where the use of systemic pesticide-treated seed would be effective in addressing a pest problem in Minnesota, including but not limited to consideration of cropping systems, pest pressures, soil types, geographic location, and feasibility of alternatives to systemic pesticide treatments; and

(4) develop science-based best management practices for situations where use of systemic pesticide-treated seed is appropriate in Minnesota. This shall include a process for public comment on proposed BMPs.

Subd. 2. Education and outreach. The commissioner shall, in coordination with the University of Minnesota and other interested parties, develop and disseminate educational materials on best management practices and other related information for the use of systemic pesticide-treated seed and alternatives to the use of systemic pesticide‑treated seed.

Subd. 3. Engagement. The commissioner may engage with and provide grants to the University of Minnesota and others in conducting research, demonstration projects, and developing recommended best management practices for the use of pesticide-treated seed.

Sec. 18. [18B.053] PESTICIDE-TREATED SEED RESEARCH ACCOUNT.

A pesticide-treated seed research account is established in the agricultural fund. Money in the account, including interest, is appropriated to the commissioner to provide grants to the University of Minnesota or other parties for research related to the use of pesticide-treated seed and alternatives to the use of pesticide-treated seed. Funding in the account may be used to:

(1) determine situations where the use of pesticide-treated seed is necessary in Minnesota, including but not limited to consideration of cropping systems, pest pressures, soil types, geographic location, and feasibility of alternatives to systemic pesticide treatments;

(2) evaluate nonchemical pest prevention methods that may be used instead of pesticide-treated seed;

(3) develop science-based best management practices for situations where use of systemic pesticide-treated seed is appropriate in Minnesota; and

(4) develop and conduct demonstration, educational, and promotional activities for best management practices and other recommended practices related to the use, or minimization of the use, of pesticide-treated seed.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5383

Sec. 19. Minnesota Statutes 2022, section 18B.055, is amended to read:

18B.055 COMPENSATION FOR BEES KILLED BY PESTICIDE; APPROPRIATION.

Subdivision 1. Compensation required. (a) The commissioner must compensate a ~~person~~ bee owner for an acute pesticide poisoning resulting in the death of bees or loss of bee colonies owned by the ~~person, provided:~~ bee owner.

~~(1) the person who applied the pesticide cannot be determined;~~

~~(2) the person who applied the pesticide did so in a manner consistent with the pesticide product's label or labeling; or~~

~~(3) the person who applied the pesticide did so in a manner inconsistent with the pesticide product's label or labeling.~~

(b) Except as provided in this section, the bee owner is entitled to the fair market value of the dead bees and bee colonies losses as determined by the commissioner upon recommendation by academic experts and bee keepers. ~~In any fiscal year,~~ A bee owner must not be compensated for a claim that is less than $100 or compensated more than ~~$20,000 for all eligible claims.~~ $10,000 for a bee kill incident. A bee owner may only make one claim for a single bee kill incident.

~~(c)~~ (d) To be eligible for compensation under this section, the bee owner and the affected apiary must be registered prior to the bee kill incident with a commonly utilized pesticide registry program, as designated by the commissioner.

~~Subd. 2.~~ ~~Applicator responsible.~~ In the event a person applies a pesticide in a manner inconsistent with the pesticide product's label or labeling requirements as approved by the commissioner and is determined to have caused the acute pesticide poisoning of bees, resulting in death or loss of a bee colony kept for commercial purposes, then the person so identified must bear the responsibility of restitution for the value of the bees to the owner. In these cases the commissioner must not provide compensation as provided in this section.

Subd. 3. Claim form. Within three months of the commissioner making a determination of whether the death of bees or loss of bee colonies was caused by acute pesticide poisoning, the bee owner must file a claim on forms provided by the commissioner and available on the Department of Agriculture's website.

Subd. 4. Determination. The commissioner must determine whether the death of the bees or loss of bee colonies was caused by an acute pesticide poisoning, whether the pesticide applicator can be determined, and whether the pesticide applicator applied the pesticide product in a manner consistent with the pesticide product's label or labeling.

Subd. 5. Payments; denial of compensation. (a) If the commissioner determines the bee death or loss of bee colony was caused by an acute pesticide poisoning and either the pesticide applicator cannot be determined or the pesticide applicator applied the pesticide product in a manner consistent with the pesticide product's label or labeling, the commissioner may award compensation from the pesticide regulatory account. If the pesticide applicator can be determined and the applicator applied the pesticide product in a manner inconsistent with the product's label or labeling, the commissioner may collect a penalty from the pesticide applicator sufficient to compensate the bee owner for the fair market value of the dead bees and bee colonies losses, and must award the money to the bee owner.

~~Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5384~~

~~(b)~~ (a) If the commissioner denies compensation claimed by a bee owner under this section, the commissioner must issue a written decision based upon the available evidence. The decision must include specification of the facts upon which the decision is based and the conclusions on the material issues of the claim. The commissioner must mail a copy of the decision to the bee owner.

~~(c)~~ (b) A decision to deny compensation claimed under this section is not subject to the contested case review procedures of chapter 14, but may be reviewed upon a trial de novo in a court in the county where the loss occurred. The decision of the court may be appealed as in other civil cases. Review in court may be obtained by filing a petition for review with the administrator of the court within 60 days following receipt of a decision under this section. Upon the filing of a petition, the administrator must mail a copy to the commissioner and set a time for hearing within 90 days of the filing.

Subd. 6. Deduction from payment. The commissioner must reduce payments made under this section by any compensation received by the bee owner for dead bees and bee colonies losses as proceeds from an insurance policy or from another source.

Subd. 6a. Enhanced penalty factor. If the commissioner determines that a bee death or loss of bee colony was caused by acute pesticide poisoning, is able to determine the pesticide applicator that was responsible, and determines that the applicator applied the pesticide in a manner inconsistent with the product's label or labeling, the commissioner may add the amount that the bee owner received from the bee owner's claim to any penalty amount assessed by the commissioner under any penalty actions against the pesticide applicator under section 18D.315 or 18D.325.

Subd. 7. Appropriation. The amount necessary to pay claims under this section, not to exceed $150,000 per fiscal year, is appropriated from the pesticide regulatory account in section 18B.05.

Sec. 20. [18B.075] PESTICIDE-TREATED SEED.

A person may not use, store, handle, distribute, or dispose of seed treated with pesticide in a manner that:

(1) endangers humans, food, livestock, fish, or wildlife; or

(2) will cause unreasonable adverse effects on the environment.

Sec. 21. [18B.117] REGISTRATION PROHIBITED.

The commissioner must not register under section 18B.26 a pesticide product that contains a perfluoroalkyl or polyfluoroalkyl substance as an active or inert ingredient.

EFFECTIVE DATE. This section is effective July 1, 2024.

Sec. 22. Minnesota Statutes 2022, section 18C.425, subdivision 6, is amended to read:

Subd. 6. Payment of inspection fee. (a) The person who registers and distributes in the state a specialty fertilizer, soil amendment, or plant amendment under section 18C.411 shall pay the inspection fee to the commissioner.

(b) The person licensed under section 18C.415 who distributes a fertilizer to a person not required to be so licensed shall pay the inspection fee to the commissioner, except as exempted under section 18C.421, subdivision 1, paragraph (b).

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5385

(c) The person responsible for payment of the inspection fees for fertilizers, soil amendments, or plant amendments sold and used in this state must pay an inspection fee of 39 64 cents per ton, and until June 30, 2024, an additional 40 cents per ton, of fertilizer, soil amendment, and plant amendment sold or distributed in this state, with a minimum of $10 on all tonnage reports. Notwithstanding section 18C.131, the commissioner must deposit all revenue from the additional 40 cents per ton fee in the agricultural fertilizer research and education account in section 18C.80. Products sold or distributed to manufacturers or exchanged between them are exempt from the inspection fee imposed by this subdivision if the products are used exclusively for manufacturing purposes.

(d) A registrant or licensee must retain invoices showing proof of fertilizer, plant amendment, or soil amendment distribution amounts and inspection fees paid for a period of three years.

Sec. 23. Minnesota Statutes 2022, section 18H.02, is amended by adding a subdivision to read:

Subd. 15a. Live plant dealer. "Live plant dealer" means an entity who:

(1) raises, grows, or propagates nursery stock for sale, outdoors or indoors;

(2) acquires and further distributes nursery stock, including through landscaping or distribution with a tree spade; or

(3) operates a business in Minnesota selling nursery stock with or without taking ownership or handling the nursery stock.

Sec. 24. Minnesota Statutes 2022, section 18H.03, subdivision 6, is amended to read:

Subd. 6. Dissemination of information. The commissioner may disseminate information among ~~growers~~ live plant dealers relative to treatment of nursery stock in both prevention and elimination of attack by plant pests and diseases.

Sec. 25. Minnesota Statutes 2022, section 18H.05, is amended to read:

18H.05 NURSERY CERTIFICATE REQUIREMENTS.

(a) No person may offer for sale or distribute certified nursery stock as a ~~nursery stock grower or~~ live plant dealer without first obtaining the appropriate nursery stock certificate from the commissioner. The commissioner may not issue a certificate to a person who does not sell certified nursery stock. Certificates are issued solely for these purposes and may not be used for other purposes.

(b) A certificate issued by the commissioner expires on December 31 of the year it is issued.

(c) A person required to be certified by this section must apply for a certificate or for renewal on a form furnished by the commissioner which must contain:

(1) the name and address of the applicant, the number of locations to be operated by the applicant and their addresses, and the assumed business name of the applicant;

(2) if other than an individual, a statement whether a person is a partnership, corporation, or other organization;

(3) the type of business to be operated and, if the applicant is an agent, the principals the applicant represents; and

(4) source or sources of purchased nursery stock.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5386

(d) No person may:

(1) falsely claim to be a certified live plant dealer~~, grower, broker, or agent~~;

(2) make willful false statements when applying for a certificate; or

(3) sell or distribute certified nursery stock to an uncertified ~~nursery stock~~ live plant dealer who is required to be certified ~~or nursery stock grower~~.

(e) Each application for a certificate must be accompanied by the appropriate certificate fee under section 18H.07.

(f) Certificates issued by the commissioner must be prominently displayed to the public in the place of business where certified nursery stock is sold or distributed.

(g) The commissioner may refuse to issue a certificate for cause.

(h) Each ~~grower or~~ live plant dealer is entitled to one sales location under the certificate ~~of the grower or dealer~~. Each additional sales location maintained by the person requires the payment of the full certificate fee for each additional sales outlet.

~~(i) A grower who is also a dealer is certified only as a grower for that specific site.~~

~~(j)~~ (i) A certificate is personal to the applicant and may not be transferred. A new certificate is necessary if the business entity is changed or if the membership of a partnership is changed, whether or not the business name is changed.

~~(k)~~ (j) The certificate issued to a live plant dealer ~~or grower~~ applies to the particular premises named in the certificate. However, if prior approval is obtained from the commissioner, the place of business may be moved to the other premises or location without an additional certificate fee.

~~(l)~~ (k) A collector of nursery stock from the wild is required to obtain a ~~dealer's~~ live plant dealer certificate from the commissioner and is subject to all the requirements that apply to the inspection of nursery stock. All collected nursery stock must be labeled as "collected from the wild."

Sec. 26. Minnesota Statutes 2022, section 18H.07, is amended by adding a subdivision to read:

Subd. 3a. New live plant dealer certificate. An entity that was not distributing certified nursery stock for the past two full calendar years is considered a new applicant for the basis of fee determination. A new live plant dealer must pay the following fees:

(1) $50 fee for a live plant dealer certificate that allows for one retail sales location. A $50 certificate is required for each additional retail sales location; and

(2) a live plant dealer growing nursery stock requires an inspection for certification of that nursery stock prior to sale of the nursery stock and must be assessed an additional charge of $100 plus $10 per acre up to 200 acres. Acreage to be certified should be rounded to the nearest one acre. For the basis of fee determination, "growing nursery stock" means the purchase of seeds, seedlings, or small plants and the cultivation of the plants in fields or containers in Minnesota for eventual sale, including cutting, splitting, and propagating plants.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5387

Sec. 27. Minnesota Statutes 2022, section 18H.07, is amended by adding a subdivision to read:

Subd. 3b. Live plant dealer renewal certificate. (a) A renewal certificate is for a live plant dealer that has had a certificate in at least one of the past two full calendar years. A live plant dealer must pay an annual fee based on the following criteria:

(1) a $50 fee for a live plant dealer certificate that allows for one retail sales location. A $50 certificate is required for each additional retail sales location;

(2) a fee of gross annual purchases of certified nursery stock as noted in the table below with the intent to resell in the same year. These are plants that are watered and maintained only for the purposes of keeping the plants alive. Gross annual purchases are calculated for nursery stock purchases from January 1 through December 31 of the most recent certificate year according to the following table;

Purchases		Fee
$0	to $3,000	$0
$3,001	to $10,000	$50
$10,001	to $20,000	$100
$20,001	to $50,000	$225
$50,001	to $100,000	$425
$100,001	to $150,000	$600
$150,001	to $200,000	$750
$200,001	to $300,000	$975
$300,001	to $400,000	$1,200
$400,001	to $500,000	$1,250
$500,001	to $600,000	$1,350
$600,001	to $700,000	$1,400
$700,001	to $800,000	$1,500
$800,001	to $900,000	$1,600
$900,001	to $1,000,000	$1,700
$1,000,001	to $2,000,000	$1,800
$2,000,001	to $3,000,000	$1,900
$3,000,001 or more		.0005 x annual purchases; and

(3) a live plant dealer growing nursery stock requires an inspection for certification of that nursery stock prior to sale and must be assessed an additional charge of $100 plus $10 per acre up to 200 acres. Acreage to be certified should be rounded to the nearest one acre. For the basis of fee determination, "growing nursery stock" is the purchase of seeds, seedlings, or small plants and the cultivation of plants in fields or containers in Minnesota for eventual sale, including cutting, splitting, and propagating plants.

(b) In addition to the fees in paragraph (a), a penalty of 25 percent of the fee due may be charged or a portion thereof, if the fee is delinquent or any application for renewal is not postmarked or electronically date stamped by December 31 of the current year.

(c) A live plant dealer operating without a valid certificate must not offer nursery stock for sale or sell nursery stock until a certificate is issued to the live plant dealer by the commissioner and the live plant dealer has paid any applicable fees and penalties in full.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5388

Sec. 28. Minnesota Statutes 2022, section 18H.08, subdivision 2, is amended to read:

Subd. 2. Virus disease-free certification. The commissioner may provide special services such as virus disease-free certification and other similar programs. Participation by ~~nursery stock growers~~ live plant dealers is voluntary. Plants offered for sale as certified virus-free must be grown according to certain procedures in a manner defined by the commissioner for the purpose of eliminating viruses and other injurious disease or insect pests. The commissioner shall collect reasonable fees from participating ~~nursery stock growers~~ live plant dealers for services and materials that are necessary to conduct this type of work.

Sec. 29. Minnesota Statutes 2022, section 18H.09, is amended to read:

18H.09 NURSERY STOCK CERTIFICATION REQUIREMENTS.

(a) All nursery stock growing at sites identified by ~~nursery stock dealers or nursery stock growers~~ live plant dealers and submitted for inspection must be inspected by the commissioner within the previous 12 months prior to sale and found apparently free from quarantine and regulated nonquarantine pests as well as significantly dangerous or potentially damaging plant pests. The commissioner may waive a site inspection under the following conditions:

(1) the nursery stock is not going to be sold within 12 months;

(2) the nursery stock will not be moved out of Minnesota; and

(3) the nursery site or stock is not subject to certification requirements associated with a state or federally regulated or quarantined plant pest.

All nursery stock originating from out of state and offered for sale in Minnesota must have been inspected by the appropriate state or federal agency during the previous 12 months and found free from quarantine and regulated nonquarantine pests as well as significantly dangerous or potentially damaging plant pests. A nursery stock certificate is valid from January 1 to December 31.

(b) Nursery stock must be accessible to the commissioner for inspection during regular business hours. Weeds or other growth that hinder a proper inspection are grounds to suspend or withhold a certificate or require a reinspection.

(c) Inspection reports issued to ~~growers~~ live plant dealers must contain a list of the plant pests found at the time of inspection. Withdrawal-from-distribution orders are considered part of the inspection reports. A withdrawal‑from-distribution order must contain a list of plants withdrawn from distribution and the location of the plants.

(d) The commissioner may post signs to delineate sections withdrawn from distribution. These signs must remain in place until the commissioner removes them or grants written permission to the grower to remove the signs.

(e) Inspection reports issued to live plant dealers must outline the violations involved and corrective actions to be taken including withdrawal-from-distribution orders which would specify nursery stock that could not be distributed from a certain area.

(f) Optional inspections of plants may be conducted by the commissioner upon request by any persons desiring an inspection. A fee as provided in section 18H.07 must be charged for such an inspection.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5389

Sec. 30. Minnesota Statutes 2022, section 18H.13, subdivision 3, is amended to read:

Subd. 3. Reciprocal agreements. The commissioner may cooperate with and enter into reciprocal agreements with other states regarding licensing and movement of nursery stock. Reciprocal agreements with other states do not prevent the commissioner from prohibiting the distribution in Minnesota of any nursery stock that fails to meet minimum criteria for nursery stock of Minnesota certified ~~growers, dealers, or both~~ live plant dealers. An official directory of certified nurseries and related nursery industry businesses from other states is acceptable in lieu of individual nursery certificates.

Sec. 31. Minnesota Statutes 2022, section 18H.15, is amended to read:

18H.15 VIOLATIONS.

(a) A person who offers to distribute nursery stock that is uncertified, uninspected, or falsely labeled or advertised possesses an illegal regulated commodity that is considered infested or infected with harmful plant pests and subject to regulatory action and control. If the commissioner determines that the provisions of this section have been violated, the commissioner may order the destruction of all of the plants unless the person:

(1) provides proper phytosanitary preclearance, phytosanitary certification, or nursery stock certification;

(2) agrees to have the plants, plant materials, or nursery stock returned to the consignor; and

(3) provides proper documentation, certification, or compliance to support advertising claims.

(b) The plant owner is liable for all costs associated with a withdrawal-from-distribution order or the quarantine, treatment, or destruction of plants. The commissioner is not liable for actual or incidental costs incurred by a person due to the commissioner's actions. The commissioner must be reimbursed by the owner of the plants for the actual expenses incurred in carrying out a withdrawal-from-distribution order or the quarantine, treatment, or destruction of any plants.

(1) misrepresent, falsify, or knowingly distribute, sell, advertise, or display damaged, mislabeled, misrepresented, infested, or infected nursery stock;

(2) fail to obtain a nursery certificate as required by the commissioner;

(3) fail to renew a nursery certificate, but continue business operations;

(4) fail to display a nursery certificate;

(5) misrepresent or falsify a nursery certificate;

(6) refuse to submit to a nursery inspection;

(7) fail to provide the cooperation necessary to conduct a successful nursery inspection;

(8) offer for sale uncertified plants, plant materials, or nursery stock;

(9) possess an illegal regulated commodity;

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5390

(10) violate or disobey a commissioner's order;

(11) violate a quarantine issued by the commissioner;

(12) fail to obtain phytosanitary certification for plant material or nursery stock brought into Minnesota;

(13) deface, mutilate, or destroy a nursery stock certificate, phytosanitary certificate, or phytosanitary preclearance certificate, or other commissioner mark, permit, or certificate;

(14) fail to notify the commissioner of an uncertified shipment of plants, plant materials, or nursery stock;

(15) transport uncertified plants, plant materials, or nursery stock in Minnesota; or

(16) sell nursery stock to an uncertified ~~nursery stock~~ live plant dealer who is required to be certified.

Sec. 32. Minnesota Statutes 2022, section 18K.04, subdivision 1, is amended to read:

Subdivision 1. Requirement; issuance; presumption. (a) A person must obtain a license from the commissioner before (1) growing industrial hemp ~~for commercial or research purposes~~, ~~and~~ (2) ~~before~~ processing industrial hemp ~~for commercial purposes~~, or (3) researching industrial hemp.

(b) To obtain a license under paragraph (a), a person must apply to the commissioner in the form prescribed by the commissioner and must pay the annual registration and inspection fee established by the commissioner in accordance with section 16A.1285, subdivision 2.

(c) For a license to grow industrial hemp ~~for commercial or research purposes~~, the license application must include the name and address of the applicant and the legal description of the land area or areas where industrial hemp will be grown by the applicant and any other information required under Code of Federal Regulations, title 7, part 990.

(d) For a license to process industrial hemp ~~for commercial purposes~~, the license application must include the name and address of the applicant, the legal description of the processing location, and any other information required by the commissioner.

(e) A licensee is responsible for compliance with the license requirements irrespective of the acts or omissions of an authorized representative acting on behalf of the licensee.

(f) When an applicant has paid the fee and completed the application process to the satisfaction of the commissioner, the commissioner must issue a license which is valid until December 31 of the year of application.

(g) A person licensed under paragraph (a) to grow industrial hemp is presumed to be growing industrial hemp for commercial or research purposes.

Sec. 33. Minnesota Statutes 2022, section 18K.04, subdivision 2, is amended to read:

Subd. 2. Background check; data classification. The commissioner must require each first-time applicant for a license to submit to a background investigation conducted by the Bureau of Criminal Apprehension as a condition of licensure. Any first-time authorized representatives designated by the applicant must also submit to a background investigation. As part of the background investigation, the Bureau of Criminal Apprehension must conduct criminal history checks of Minnesota records and is authorized to exchange fingerprints with the United States Department of Justice, Federal Bureau of Investigation for the purpose of a criminal background check of the national files. The cost of the investigation must be paid by the applicant. Criminal history records provided to the commissioner under this section must be treated as private data on individuals, as defined in section 13.02, subdivision 12.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5391

Sec. 34. Minnesota Statutes 2022, section 18K.06, is amended to read:

18K.06 RULEMAKING.

(a) The commissioner shall adopt rules governing the production, testing, processing, and licensing of industrial hemp. ~~Notwithstanding section 14.125, the commissioner's authority to adopt these rules expires June 30, 2022.~~ Notwithstanding the two-year limitation for exempt rules under section 14.388, subdivision 1, Minnesota Rules, chapter 1565, published in the State Register on August 16, 2021, is effective until August 16, 2025, or until permanent rules implementing chapter 18K are adopted, whichever occurs first.

(b) Rules adopted under paragraph (a) must include, but not be limited to, provisions governing:

(1) the supervision and inspection of industrial hemp during its growth and harvest;

(2) the testing of industrial hemp to determine delta-9 tetrahydrocannabinol levels;

(3) the use of background check results required under section 18K.04 to approve or deny a license application; and

(4) any other provision or procedure necessary to carry out the purposes of this chapter.

(c) Rules issued under this section must be consistent with federal law regarding the production, distribution, and sale of industrial hemp.

Sec. 35. [18K.10] HEMP FIBER PROCESSING EQUIPMENT GRANTS.

The commissioner must award grants to licensed processors that increase the state's capacity to process industrial hemp fiber. Grants are limited to no more than $200,000 of processing equipment and reasonable equipment installation costs per processing location. A licensed processor must match the grant with other funding equal to at least 25 percent of the grant amount.

Sec. 36. Minnesota Statutes 2022, section 25.39, subdivision 1, is amended to read:

Subdivision 1. Amount of fee. (a) An inspection fee at the rate of 16 cents per ton must be paid to the commissioner on commercial feeds distributed in this state by the person who first distributes the commercial feed, except that:

(1) no fee need be paid on any feed ingredient in a customer formula feed that has been directly furnished by the customer; or

(2) no fee need be paid on a first distribution if made to a qualified buyer who, with approval from the commissioner, is responsible for the fee. Such license-specific tonnage-fee-exemption permits shall be issued on a calendar year basis to commercial feed licensees who distribute feed or feed ingredients outside the state, and who submit a $100 nonrefundable application fee and comply with rules adopted by the commissioner relative to record keeping, tonnage of commercial feed distributed in Minnesota, total of all commercial feed tonnage distributed, and all other information which the commissioner may require so as to ensure that proper inspection fee payment has been made.

(b) In the case of pet food or specialty pet food distributed in the state only in packages of ten pounds or less, a distributor must register each product ~~and submit a current label for each product~~ annually on forms provided by the commissioner, accompanied by an annual application fee of $100 for each product in lieu of the inspection fee, and within five business days, submit a current label for each product upon the request of the commissioner. This annual fee must be received by the commissioner on or before June 30 or postmarked on or before June 30. The inspection fee required by paragraph (a) applies to pet food or specialty pet food distributed in packages exceeding ten pounds.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5392

Sec. 37. Minnesota Statutes 2022, section 28A.08, is amended by adding a subdivision to read:

Subd. 4. Food handler license account; appropriation. A food handler license account is established in the agricultural fund. Fees paid under subdivision 3 must be deposited in this account. Money in the account, including interest, is appropriated to the commissioner for expenses relating to licensing and inspecting food handlers under chapters 28 to 34A or rules adopted under one of those chapters.

Sec. 38. Minnesota Statutes 2022, section 28A.082, subdivision 1, is amended to read:

Subdivision 1. Fees; application. (a) The fees for review of food handler facility floor plans under the Minnesota Food Code are based upon the square footage of the structure being newly constructed, remodeled, or converted. The fees for the review shall be:

square footage	review fee
0 - ~~4,999~~ 999.....................	$200.00
1,000 - 4,999.....................	$400.00
5,000 - 24,999...................	$ ~~275.00~~ 800.00
25,000 plus........................	$ ~~425.00~~ 1,000.00

(b) The applicant must submit the required fee, review application, plans, equipment specifications, materials lists, and other required information on forms supplied by the department at least 30 days prior to commencement of construction, remodeling, or conversion. The commissioner may waive this fee after determining that the facility's principal mode of business is not the sale of food and that the facility sells only prepackaged foods.

(c) The fee for a remodel of a licensed food establishment by the license holder is based on the total square footage in paragraph (a) of the remodeled food preparation, service, display, and storage areas only. This paragraph does not apply to a retail food handler who is applying for a new license that includes the conversion of an existing building or structure that was previously licensed as a food establishment.

Sec. 39. Minnesota Statutes 2022, section 28A.09, is amended by adding a subdivision to read:

Subd. 3. Vending machine inspection account; appropriation. A vending machine inspection account is established in the agricultural fund. Fees paid under subdivision 1 must be deposited in this account. Money in the account, including interest, is appropriated to the commissioner for expenses relating to identifying and inspecting food vending machines under chapters 28 to 34A or rules adopted under one of those chapters.

Sec. 40. Minnesota Statutes 2022, section 35.02, subdivision 1, is amended to read:

Subdivision 1. Members; officers. The board has ~~six~~ 11 members appointed by the governor with the advice and consent of the senate, four of whom are producers of livestock in the state and at least one of the four livestock producers is also a member of a federally recognized Tribe located in Minnesota, and two of whom are practicing veterinarians licensed in Minnesota two at-large members, one member who is a member of a federally recognized Tribe located in Minnesota, and eight regional members, with no two regional members residing in the same congressional district. To the extent practicable, the governor's appointments must achieve gender balance among the board membership. Members must be knowledgeable in animal agriculture, animal health, or pets and companion animals, with at least two members who represent the public and are not employed in agriculture, veterinary medicine, the pet industry, or a related field. The commissioners of agriculture, natural resources, and health, the dean of the College of Veterinary Medicine, and the director of the Veterinary Diagnostic Laboratory of the University of Minnesota ~~may~~ shall serve as consultants to the board without vote. Appointments to fill

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5393

unexpired terms must be made from the classes to which the retiring members belong. The board shall elect a president and a vice-president from among its members ~~and~~. The governor shall appoint a veterinarian licensed in Minnesota who is not a member to be ~~its~~ the board's executive director for a term of one year and until a successor qualifies. The board shall set the duties of the director.

EFFECTIVE DATE. This section is effective July 1, 2023, and applies to appointments that occur on or after that date.

Sec. 41. Minnesota Statutes 2022, section 35.05, is amended to read:

35.05 AUTHORITY OF STATE BOARD.

(a) The state board may quarantine or kill any domestic animal infected with, or which has been exposed to, a contagious or infectious dangerous disease if it is necessary to protect the health of the domestic animals of the state.

(b) The board may regulate or prohibit the arrival in and departure from the state of infected or exposed animals and, in case of violation of any rule or prohibition, may detain any animal at its owner's expense. The board may regulate or prohibit the importation of domestic animals which, in its opinion, may injure the health of Minnesota livestock.

(c) When the governor declares an emergency under section 35.0661, the board, through its executive director, may assume control of such resources within the University of Minnesota's Veterinary Diagnostic Laboratory as necessary to effectively address the disease outbreak. The director of the laboratory and other laboratory personnel must cooperate fully in performing necessary functions related to the outbreak or threatened outbreak.

(d) The board may test or require tests of any bovine or cervidae in the state when the board deems it necessary to achieve or maintain bovine tuberculosis accredited free state or zone status under the regulations and laws administered by the United States Department of Agriculture.

(e) Notwithstanding section 3.3005, subdivision 2, the board may apply for, receive, and disburse federal money made available to the state for animal disease response. All federal money received by the board for this purpose must be deposited in the state treasury and~~, except as provided in section 35.156, subdivision 2,~~ is appropriated to the board for the purposes for which it was received. By January 15 each year, the board must report to the senate Committee on Finance, the house of representatives Committee on Ways and Means, and the legislative committees with jurisdiction over the board's operating budget regarding the amount of federal money received and spent in the previous fiscal year under this paragraph and the board's use of these funds.

Sec. 42. Minnesota Statutes 2022, section 41A.12, subdivision 4, is amended to read:

Subd. 4. Sunset. This section expires on June 30, ~~2025~~ 2035.

Sec. 43. Minnesota Statutes 2022, section 41A.16, subdivision 1, is amended to read:

Subdivision 1. Eligibility ~~for participants on or before April 1, 2023~~. (a) A facility eligible for payment under this section must source from Minnesota at least 80 percent of the biomass used to produce an advanced biofuel, except that, if a facility is sited 50 miles or less from the state border, biomass used to produce an advanced biofuel may be sourced from outside of Minnesota, but only if at least 80 percent of the biomass is sourced from within a 100-mile radius of the facility or from within Minnesota. The facility must be located in Minnesota, must begin production at a specific location on or before ~~April 1~~ June 30, 2023, and must not begin operating above 23,750 MMbtu of quarterly advanced biofuel production before July 1, 2015. Eligible facilities include existing companies and facilities that are adding advanced biofuel production capacity, or retrofitting existing capacity, as well as new companies and facilities. Production of conventional corn ethanol and conventional biodiesel is not eligible. Eligible advanced biofuel facilities must produce at least 1,500 MMbtu of advanced biofuel quarterly.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5394

(b) No payments shall be made for advanced biofuel production that occurs after June 30, 2035, for those eligible biofuel producers under paragraph (a).

(c) An eligible producer of advanced biofuel shall not transfer the producer's eligibility for payments under this section to an advanced biofuel facility at a different location.

(d) A producer that ceases production for any reason is ineligible to receive payments under this section until the producer resumes production.

(e) Renewable chemical production for which payment has been received under section 41A.17, and biomass thermal production for which payment has been received under section 41A.18, are not eligible for payment under this section.

(f) Biobutanol is eligible under this section.

EFFECTIVE DATE. This section is effective retroactively from March 31, 2023.

Sec. 44. Minnesota Statutes 2022, section 41A.16, subdivision 2, is amended to read:

Subd. 2. Payment amounts; limits. (a) The commissioner shall make payments to eligible producers of advanced biofuel. The amount of the payment for each eligible producer's annual production is $2.1053 per MMbtu for advanced biofuel production from cellulosic biomass, and $1.053 per MMbtu for advanced biofuel production from sugar, starch, oil, or animal fat at a specific location for ten years after the start of production.

(b) Total payments under this section to an eligible biofuel producer in a fiscal year may not exceed the amount necessary for 2,850,000 MMbtu of biofuel production. Total payments under this section to all eligible biofuel producers in a fiscal year may not exceed the amount necessary for 17,100,000 MMbtu of biofuel production. If the total amount for which all producers are eligible in a quarter exceeds the amount available for payments, the commissioner shall make the payments on a pro rata basis. An eligible producer may reapply for payment of, and the commissioner must pay, the difference between a claim for payment filed under subdivision 6 and the pro rata amount received:

(1) until the full amount of the original claim is paid; and

(2) subject to available money appropriated for the express purpose of paying claims not otherwise paid.

(c) For purposes of this section, an entity that holds a controlling interest in more than one advanced biofuel facility is considered a single eligible producer.

EFFECTIVE DATE. This section is effective retroactively from January 1, 2020, and applies to claims filed after January 1, 2020.

Sec. 45. Minnesota Statutes 2022, section 41A.17, subdivision 1, is amended to read:

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5395

companies and facilities that are adding production capacity, or retrofitting existing capacity, as well as new companies and facilities. Eligible renewable chemical facilities must produce at least 250,000 pounds of renewable chemicals quarterly. Renewable chemicals produced through processes that are fully commercial before January 1, 2000, are not eligible.

(b) No payments shall be made for renewable chemical production that occurs after June 30, 2035, for those eligible renewable chemical producers under paragraph (a).

(c) An eligible producer of renewable chemicals shall not transfer the producer's eligibility for payments under this section to a renewable chemical facility at a different location.

(d) A producer that ceases production for any reason is ineligible to receive payments under this section until the producer resumes production.

(e) Advanced biofuel production for which payment has been received under section 41A.16, and biomass thermal production for which payment has been received under section 41A.18, are not eligible for payment under this section.

EFFECTIVE DATE. This section is effective retroactively from March 31, 2023.

Sec. 46. Minnesota Statutes 2022, section 41A.17, subdivision 2, is amended to read:

Subd. 2. Payment amounts; bonus; limits. (a) The commissioner shall make payments to eligible producers of renewable chemicals located in the state. The amount of the payment for each producer's annual production is $0.03 per pound of sugar-derived renewable chemical, $0.03 per pound of cellulosic sugar, starch, oil, or animal fat, and $0.06 per pound of cellulosic-derived renewable chemical produced at a specific location for ten years after the start of production.

(b) An eligible facility producing renewable chemicals using agricultural cellulosic biomass is eligible for a 20 percent bonus payment for each pound produced from agricultural biomass that is derived from perennial crop or cover crop biomass.

(c) Total payments under this section to an eligible renewable chemical producer in a fiscal year may not exceed the amount necessary for 99,999,999 pounds of renewable chemical production. Total payments under this section to all eligible renewable chemical producers in a fiscal year may not exceed the amount necessary for 599,999,999 pounds of renewable chemical production. If the total amount for which all producers are eligible in a quarter exceeds the amount available for payments, the commissioner shall make the payments on a pro rata basis. An eligible producer may reapply for payment of, and the commissioner must pay, the difference between a claim for payment filed under subdivision 5 and the pro rata amount received:

(1) until the full amount of the original claim is paid; and

(2) subject to available money appropriated for the express purpose of paying claims not otherwise paid.

(d) An eligible facility may blend renewable chemicals with other chemicals that are not renewable chemicals, but only the percentage attributable to renewable chemicals in the blended product is eligible to receive payment.

(e) For purposes of this section, an entity that holds a controlling interest in more than one renewable chemical production facility is considered a single eligible producer.

EFFECTIVE DATE. This section is effective retroactively from January 1, 2020, and applies to claims filed after January 1, 2020.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5396

Sec. 47. Minnesota Statutes 2022, section 41A.18, subdivision 1, is amended to read:

Subdivision 1. Eligibility ~~for participants on or before April 1, 2023~~. (a) A facility eligible for payment under this section must source from Minnesota at least 80 percent of the biomass used for biomass thermal production, except that, if a facility is sited 50 miles or less from the state border, biomass used for biomass thermal production may be sourced from outside of Minnesota, but only if at least 80 percent of the biomass is sourced from within a 100-mile radius of the facility, or from within Minnesota. Biomass must be from agricultural or forestry sources. The facility must be located in Minnesota, must have begun production at a specific location on or before ~~April 1~~ June 30, 2023, and must not begin before July 1, 2015. Eligible facilities include existing companies and facilities that are adding production capacity, or retrofitting existing capacity, as well as new companies and facilities. Eligible biomass thermal production facilities must produce at least 250 MMbtu of biomass thermal quarterly.

(b) No payments shall be made for biomass thermal production that occurs after June 30, 2035, for those eligible biomass thermal producers under paragraph (a).

(c) An eligible producer of biomass thermal production shall not transfer the producer's eligibility for payments under this section to a biomass thermal production facility at a different location.

(d) A producer that ceases production for any reason is ineligible to receive payments under this section until the producer resumes production.

(e) Biofuel production for which payment has been received under section 41A.16, and renewable chemical production for which payment has been received under section 41A.17, are not eligible for payment under this section.

EFFECTIVE DATE. This section is effective retroactively from March 31, 2023.

Sec. 48. Minnesota Statutes 2022, section 41A.18, subdivision 2, is amended to read:

Subd. 2. Payment amounts; bonus; limits; blending. (a) The commissioner shall make payments to eligible producers of biomass thermal located in the state. The amount of the payment for each producer's annual production is $5.00 per MMbtu of biomass thermal production produced at a specific location for ten years after the start of production.

(b) An eligible facility producing biomass thermal using agricultural cellulosic biomass is eligible for a 20 percent bonus payment for each MMbtu produced from agricultural biomass that is derived from perennial crop or cover crop biomass.

(c) Total payments under this section to an eligible thermal producer in a fiscal year may not exceed the amount necessary for 30,000 MMbtu of thermal production. Total payments under this section to all eligible thermal producers in a fiscal year may not exceed the amount necessary for 150,000 MMbtu of total thermal production. If the total amount for which all producers are eligible in a quarter exceeds the amount available for payments, the commissioner shall make the payments on a pro rata basis. An eligible producer may reapply for payment of, and the commissioner must pay, the difference between a claim for payment filed under subdivision 5 and the pro rata amount received:

(1) until the full amount of the original claim is paid; and

(2) subject to available money appropriated for the express purpose of paying claims not otherwise paid.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5397

(d) An eligible facility may blend a cellulosic feedstock with other fuels in the biomass thermal production facility, but only the percentage attributable to biomass meeting the cellulosic forestry biomass requirements or agricultural cellulosic biomass sourcing plan is eligible to receive payment.

(e) When a facility is eligible due to adding production capacity or retrofitting existing capacity, the entire amount of biomass meeting the cellulosic forestry biomass requirements or agricultural cellulosic biomass sourcing plan is assumed to have been used for the biomass thermal production from the added or retrofitted production capacity.

(f) For purposes of this section, an entity that holds a controlling interest in more than one biomass thermal production facility is considered a single eligible producer.

EFFECTIVE DATE. This section is effective retroactively from January 1, 2020, and applies to claims filed after January 1, 2020.

Sec. 49. Minnesota Statutes 2022, section 41A.19, is amended to read:

41A.19 REPORT; INCENTIVE PROGRAMS.

By January 15 each year, the commissioner shall report on the incentive programs under sections 41A.16, 41A.17, 41A.18, 41A.20, and 41A.21 to the legislative committees with jurisdiction over environment policy and finance and agriculture policy and finance. The report shall include information on production and incentive expenditures under the programs., as well as the following information that the commissioner must require of each producer who receives a payment during the reporting period:

(1) the producer's business structure;

(2) the name and address of the producer's parent company, if any;

(3) a cumulative list of all financial assistance received from all public grantors for the project;

(4) goals for the number of jobs created and progress in achieving these goals, which may include separate goals for the number of part-time or full-time jobs, or, in cases where job loss is specific and demonstrable, goals for the number of jobs retained;

(5) equity hiring goals and progress in achieving these goals;

(6) wage goals and progress in achieving these goals for all jobs created or maintained by the producer;

(7) board member and executive compensation;

(8) evidence of compliance with environmental permits;

(9) the producer's intended and actual use of payments received from the commissioner; and

(10) if applicable, the latest financial audit opinion statement produced by a certified public accountant in accordance with standards established by the American Institute of Certified Public Accountants.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5398

Sec. 50. Minnesota Statutes 2022, section 223.16, is amended by adding a subdivision to read:

Subd. 3c. Failure. "Failure" means a determination by the commissioner that a grain buyer or public grain warehouse operator has failed to pay for delivered grain, breached a contract, breached more than one contract, or failed to redeliver stored grain to a producer.

Sec. 51. Minnesota Statutes 2022, section 223.17, subdivision 7, is amended to read:

Subd. 7. ~~Action on a bond~~ Breach of contract. A producer claiming to be damaged by a breach of a contract for the purchase of grain by a ~~licensed~~ grain buyer may file a written claim with the commissioner. The claim must state the facts constituting the claim. ~~The claim must be filed with the commissioner within 180 days of the breach of the contract.~~ If a claim is valid, the commissioner may immediately suspend the license, in which case the licensee shall surrender the license to the commissioner. Within 15 days the licensee may request an administrative hearing subject to chapter 14 to determine whether the license should be revoked. If no request is made within 15 days, the commissioner shall revoke the license.

Sec. 52. Minnesota Statutes 2022, section 223.17, subdivision 7a, is amended to read:

Subd. 7a. Bond requirements~~; claims~~. For entities licensed under this chapter and chapter 232, the bond requirements and ~~claims~~ actions against the bond are governed under section ~~232.22, subdivision 6a~~ 223.24, subdivision 13.

Sec. 53. Minnesota Statutes 2022, section 223.175, is amended to read:

223.175 WRITTEN VOLUNTARY EXTENSION OF CREDIT CONTRACTS; FORM.

A written confirmation required under section 223.177, subdivision 2, and a written voluntary extension of credit contract must include those items prescribed by the commissioner by rule. A contract shall include a statement of the legal and financial responsibilities of grain buyers and sellers established in this chapter. A contract shall also include the following statement in not less than ten point, all capital type, framed in a box with space provided for the seller's signature: "THIS CONTRACT CONSTITUTES A VOLUNTARY EXTENSION OF CREDIT. THIS CONTRACT ~~IS NOT COVERED BY ANY GRAIN BUYER'S BOND~~ MAY NOT BE COVERED COMPLETELY BY THE GRAIN INDEMNITY ACCOUNT." If a written contract is provided at the time the grain is delivered to the grain buyer, the seller shall sign the contract in the space provided beneath the statement. A transaction that does not meet the provisions of a voluntary extension of credit, including the issuance and signing of a voluntary extension of credit contract, is a cash sale.

Sec. 54. Minnesota Statutes 2022, section 223.19, is amended to read:

223.19 RULES.

The commissioner may make rules pursuant to chapter 14 to carry out the provisions of sections 223.15 to ~~223.23~~ 223.24.

Sec. 55. [223.24] GRAIN INDEMNITY ACCOUNT.

Subdivision 1. Establishment. The grain indemnity account is established under the direction and control of the commissioner of agriculture. The grain indemnity account shall consist of grain indemnity premiums, money from any other source, and interest.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5399

Subd. 2. Account; appropriation. (a) A grain indemnity account is established in the agricultural fund. Money in the grain indemnity account, including interest, is appropriated to the commissioner to pay valid claims and to administer this section.

(b) The commissioner shall direct payments from the grain indemnity account only for the following purposes:

(1) the payment of valid claims;

(2) the payment of grain indemnity premium refunds;

(3) the payment of administrative expenses under paragraph (c);

(4) the payment of legal fees and legal expenses under subdivision 7; or

(5) the payment of a trustee appointed under subdivision 6.

(c) The commissioner shall allocate money from the grain indemnity account to a separate administrative expenses account to pay or reimburse the agency for grain indemnity account expenses. Administrative expenses under this paragraph include the actual cost of processing payments and refunds, enforcement, record keeping, ordinary management and investment fees connected with the operation of the grain indemnity account, and legal expenses.

Subd. 3. Eligibility. A producer is eligible to receive a grain indemnity payment from the commissioner if the producer sold grain to a grain buyer as defined in this chapter or stored grain with a public grain warehouse operator under chapter 232 and the producer is damaged by the grain buyer's or public grain warehouse operator's failure to pay for or redeliver grain.

Subd. 4. Application. (a) A producer asserting eligibility under subdivision 3 must file a completed claim with the commissioner. The producer must state the facts constituting the claim and all other information required by the commissioner.

(b) Upon receiving a claim, the commissioner must promptly determine the validity of the claim and notify the claimant of the commissioner's determination.

(c) An aggrieved party may appeal the commissioner's determination by requesting, within 15 days, that the commissioner initiate a contested case proceeding under chapter 14.

Subd. 5. Payment limitation. (a) For each failure as defined by section 223.16, subdivision 3c, the commissioner must pay the eligible producer:

(1) the amount equal to the value of the grain sold on cash sale, grain assigned to warehouse receipt, or grain assigned to open storage less than 180 days from the deposit;

(2) the amount equal to the value of grain sold up to $300,000, or the lesser of $750,000 or 75 percent of the amount owed to the seller for a contract in excess of $300,000 for a deferred or delayed payment contract for which a price has been established when the contract originated within 120 days of the breach of contract;

(3) the lesser of $750,000 or 75 percent of the amount owed to the seller for a voluntary extension of credit contract for which no price has been established when the contract originated within 180 days of the breach of contract;

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5400

(4) the lesser of $500,000 or 50 percent for an open storage assignment or a voluntary extension of credit contract when the open storage assignment or contract originated between 181 days and 18 months from the failure; or

(5) the lesser of $250,000 or 25 percent for an open storage assignment or a voluntary extension of credit contract when the open storage assignment or contract originated between 19 months and 36 months from the failure.

(b) Claims filed more than 36 months from the failure are not eligible for payment.

(d) If a grain buyer holds both a Minnesota grain buyer license, as defined in chapter 223, and a license with the United States Department of Agriculture (USDA) under the United States Warehouse Act, a seller may only file a claim with the grain indemnity account if the seller sold grain as a cash sale or under a voluntary extension of credit contract. The commissioner must deny any claims for stored grain from a seller that holds both a Minnesota grain buyer license and a license with the USDA under the United States Warehouse Act.

(e) If valid claims exceed the amount of money available in the grain indemnity account, the commissioner must pay claims to producers in the order that the claims were received. When additional money becomes available, the commissioner must resume issuing grain indemnity payments to each eligible producer until each producer receives the maximum amount payable under paragraph (a).

(f) If the grain indemnity account balance is insufficient to pay refunds under subdivision 11 and valid claims exist, once money is deposited into the grain indemnity account, the commissioner must issue pending refunds for grain indemnity premium payments before issuing payments to claimants.

Subd. 6. Court order. (a) The commissioner may apply to a district court for an order appointing a trustee or receiver to manage and supervise the operations of a grain buyer or public grain warehouse operator in default. The commissioner may participate in any resulting court proceeding as an interested party.

(b) The commissioner may recover the cost of the appointed trustee using money appropriated under subdivision 2.

Subd. 7. Debt obligation; subrogated claim. (a) Money paid by the commissioner to satisfy a valid claim constitutes a debt obligation of the grain buyer or public grain warehouse operator in default. The commissioner may take action against the grain buyer or public grain warehouse operator to recover the amount of any claim payment plus reasonable costs, attorney fees, and interest computed at the rate provided in section 270C.40. The commissioner must deposit any amount recovered under this subdivision in the grain indemnity account.

(b) As a condition of payment from the commissioner, a producer must subrogate the producer's interest in a voluntary extension of credit contract to the commissioner in an amount equal to any claim payment or payments that the producer received under this section.

(c) The commissioner may recover any debt to the grain indemnity account from a member of the board or management who acted negligently or fraudulently.

Subd. 8. Grain indemnity premiums. (a) Except as provided in subdivision 10, producers of grain must be charged a grain indemnity premium as determined and published by the commissioner not to exceed 0.2 percent of the price on all marketed grain that is sold to a grain buyer as defined in chapter 223.

(b) The grain indemnity premiums required under this section are in addition to any other fees or assessments required by law.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5401

Subd. 9. Collection and submission of grain indemnity premiums. (a) Each producer must pay to the commissioner a grain indemnity premium of not more than 0.2 percent of the net proceeds from all grain sold by the producer to a grain buyer purchasing grain in Minnesota. When grain is sold to a grain buyer, the grain buyer must deduct the grain indemnity premium from the proceeds of the sale and pay the grain indemnity premium to the commissioner on behalf of the producer.

(b) When purchasing grain from a producer, a grain buyer must deduct the grain indemnity premium described in paragraph (a) from the proceeds of the sale and notify the producer of the amount of the deduction in writing. The grain buyer must forward the grain indemnity premium to the commissioner for a deposit into the grain indemnity account on behalf of the producer as described in this subdivision.

(c) A grain buyer must clearly indicate the grain indemnity premiums collected under paragraph (b) in the grain buyer's books and records. A grain buyer must retain books and records containing the grain indemnity premiums for at least three years. A grain buyer must make the grain buyer's books and records available for inspection by the commissioner during regular business hours. The department must take steps reasonably necessary to verify the accuracy of the grain indemnity premiums as recorded in the grain buyer's books and records. Any record or portion thereof seized or copied by the commissioner is private or nonpublic data as provided in section 13.02, except that the commissioner may disclose this data to aid in the law enforcement process.

(d) A grain buyer must submit grain indemnity premiums collected under paragraph (a) to the commissioner for the purpose of financing or contributing to the financing of the grain indemnity account by:

(1) January 31 for grain indemnity premiums collected during the months of July, August, September, October, November, and December; and

(2) July 31 for grain indemnity premiums collected during the months of January, February, March, April, May, and June.

Subd. 10. Amount in grain indemnity account; basis for suspension and reinstatement of grain indemnity premium collection. (a) The grain indemnity premiums required under subdivision 8 must be collected until the grain indemnity account contains more than $15,000,000, as of June 30 of any given year.

(b) Except as provided in paragraph (c), after the grain indemnity account reaches $15,000,000, the commissioner must not require the collection of additional grain indemnity premiums until the amount in the grain indemnity account drops below $9,000,000. In a year when the commissioner determines that the grain indemnity account is at or below $9,000,000, the commissioner may reinstate the collection described in this section.

(c) The commissioner shall announce the intention to collect the premiums described in this section by May 1 with collection to begin July 1 until the grain indemnity account contains at least $15,000,000. The commissioner must notify the public of the commissioner's intent to reinstate collection of additional grain indemnity premiums through publication in the State Register and by notifying each licensee of the licensee's obligation to collect premiums.

Subd. 11. Grain indemnity refund; opt out. (a) Subject to subdivision 9, a producer that has paid a grain indemnity premium may receive a refund of that premium from the grain indemnity account by submitting a written demand for a refund to the commissioner, delivered personally or by first-class mail within 12 months after the producer paid the grain indemnity premium.

(b) A producer must submit a demand for a refund of a grain indemnity premium under paragraph (a) on a demand for refund form developed by the commissioner. The commissioner must make the form available to a licensee, producer, or member of the public upon request.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5402

(c) If a producer is entitled to a refund of a grain indemnity premium under this section, the commissioner must pay the refund within 90 days of receiving the demand for a refund. If the grain indemnity account balance is insufficient to pay refunds under this subdivision and valid claims exist, once money is deposited into the grain indemnity account, the commissioner must issue pending refunds for grain indemnity premium payments before issuing payments to claimants.

(d) If the commissioner announces grain indemnity premiums as required under subdivision 10 by June 30, the commissioner must send a notice to each producer who requested a refund of a grain indemnity premium during the previous three fiscal years. The notice must inform the producer of the deadline for and method of submitting a demand for a refund to the commissioner under paragraphs (a) and (b) and the method for reentering the grain indemnity program under paragraph (e).

(e) A producer that receives a refund of a grain indemnity premium under paragraph (a) is not entitled to participate in the grain indemnity program or to receive any payment under this section unless the producer reenters the grain indemnity program by meeting all of the following conditions:

(1) the producer must submit a request for reentry into the grain indemnity program to the commissioner. The producer must submit the request on the form required by the commissioner and must deliver the request to the commissioner;

(2) the producer's request is approved by the commissioner; and

(3) the producer must pay into the grain indemnity account all grain indemnity premiums that were refunded to the producer and interest on the refunds as determined by the commissioner.

(f) A producer that reenters the grain indemnity program under paragraph (e) is eligible to be reimbursed for claims under the grain indemnity program for any breach of contract that occurs at least 120 days after reentry.

(g) A producer is not eligible for a refund of a grain indemnity premium under this section if the producer has received payment from the grain indemnity account for a valid claim within the preceding 36 months.

Subd. 12. Penalties; enforcement action; costs and expenses. (a) In addition to any other penalty or remedy provided by law, a person who knowingly or intentionally commits any of the following is subject to civil penalties under section 18J.10:

(1) refusing or failing to collect any grain indemnity premiums as required under this section;

(2) refusing or failing to pay to the commissioner any grain indemnity premiums collected under this section;

(3) making a false statement, representation, or certification, or knowingly failing to make a required statement, representation, or certification in a record, report, or other document required under this section or filed with the commissioner; or

(4) resisting, preventing, impeding, or interfering with the commissioner in the performance of the commissioner's duties under this section.

(b) In addition to the civil penalty described in paragraph (a), the commissioner in an enforcement action for a violation described in paragraph (a), clause (1) or (2), must order the grain buyer to pay into the grain indemnity account any grain indemnity premiums collected by the grain buyer that the grain buyer owes to the grain indemnity account and may order the grain buyer to pay interest on the amount that the grain buyer owes to the grain indemnity account.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5403

Subd. 13. Grain bonds; new license holders. (a) Except as provided in paragraph (b), before the commissioner issues a grain buyer or public grain warehouse operator license, a person who has not been licensed to buy grain or operate a public grain warehouse in the previous licensing period must file with the commissioner a grain bond in a penal sum of $100,000. A grain bond must remain in effect for the first three years of the license.

(b) A grain buyer who purchases grain immediately upon delivery solely with cash; a certified check; a cashier's check; or a postal, bank, or express money order is exempt from this subdivision if the grain buyer's gross annual purchases are $1,000,000 or less.

(c) The commissioner may require a supplemental bond in an amount prescribed by the commissioner based on the financial statements required in section 223.17, subdivision 6.

(d) A grain bond must be on a form provided by the commissioner.

(e) A grain bond required under paragraphs (a) and (c) must provide for the payment of any loss caused by the grain buyer's failure to pay upon the owner's demand, including loss caused by the grain buyer's failure to pay within the time required. The grain bond must be conditioned upon the grain buyer being duly licensed. A grain bond required under paragraphs (a) and (c) that is obtained by a public grain warehouse operator must be conditioned that the public grain warehouse operator issuing a grain warehouse receipt is liable to the depositor for the delivery of the kind, grade, and net quantity of grain called for by the receipt. A grain bond must be conditioned upon the operator being duly licensed. For those entities licensed under this chapter, the entire grain bond must be available to any claims against the grain bond filed under this chapter.

(f) A grain bond must not be cumulative from one licensing period to the next. The maximum liability of the grain bond must be the grain bond's face value for the licensing period.

(g) A grain bond must be continuous until canceled. To cancel a grain bond, a surety must provide 90 days' written notice of the grain bond's termination date to the licensee and the commissioner.

(h) Upon the commissioner's determination that a claim is valid, the surety for any claims against the grain bond must make payments to the grain indemnity account.

EFFECTIVE DATE. This section is effective July 1, 2023.

Sec. 56. Minnesota Statutes 2022, section 232.22, subdivision 5, is amended to read:

Subd. 5. Statement of grain in storage; reports. ~~(a) All public grain warehouse operators must by February 15~~ of each year file with the commissioner on a form approved by the commissioner a report showing the annual average liability of all grain outstanding on grain warehouse receipts, open storage, and grain stored for feed processing that occurred during the preceding calendar year. This report shall be used for the purpose of establishing the penal sum of the bond.

~~(b) Warehouse operators that are at a maximum bond and want to continue at maximum bond do not need to file this report.~~

~~(c) It is a violation of this chapter for any public grain warehouse operator to fail to file the report required in paragraph (a).~~

~~(d)~~ (a) Every public grain warehouse operator shall keep in a place of safety complete and accurate records and accounts relating to any grain warehouse operated. The records shall reflect each commodity received and shipped daily, the balance remaining in the grain warehouse at the close of each business day, a listing of all unissued grain

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5404

warehouse receipts in the operator's possession, a record of all grain warehouse receipts issued which remain outstanding and a record of all grain warehouse receipts which have been returned for cancellation. Copies of grain warehouse receipts or other documents evidencing ownership of grain by a depositor, or other liability of the grain warehouse operator, shall be retained as long as the liability exists but must be kept for a minimum of three years.

~~(e)~~ (b) Every public grain warehouse operator must maintain in the grain warehouse at all times grain of proper grade and sufficient quantity to meet delivery obligations on all outstanding grain warehouse receipts.

Sec. 57. Laws 2022, chapter 95, article 2, section 29, subdivision 6, is amended to read:

Subd. 6. Expiration. This section expires ~~June 30~~ December 31, 2024.

Sec. 58. REPORT REQUIRED; FERAL PIGS AND MINK.

By February 15, 2024, the commissioner of natural resources, in cooperation with the Board of Animal Health and the commissioners of agriculture and health, must submit a report to the chairs and ranking minority members of the legislative committees with jurisdiction over agriculture and environment and natural resources that:

(1) identifies the responsibilities of the Board of Animal Health and the commissioners of natural resources, health, and agriculture in managing feral pigs and mink;

(2) recommends any clarifications or modifications to the responsibilities identified in clause (1); and

(3) includes policy recommendations for managing feral pigs and mink to further prevent negative impacts on the environment and human health.

Sec. 59. REPORT REQUIRED; GRAIN ADVISORY GROUP.

The commissioner of agriculture must convene members of the Grain Advisory Group and develop recommendations regarding bonding requirements for licensed grain buyers and public grain warehouse operators to better protect farmers who sell and store grain in this state. No later than February 1, 2024, the commissioner must report recommendations to the legislative committees with jurisdiction over agriculture. Participating stakeholders must be given an opportunity to include written testimony in the commissioner's report.

Sec. 60. REPEALER.

Subdivision 1. Grain buyers and warehouses. Minnesota Statutes 2022, sections 223.17, subdivisions 4 and 8; and 232.22, subdivisions 4, 6, 6a, and 7, are repealed.

Subd. 2. Bioincentive programs. Minnesota Statutes 2022, sections 41A.16, subdivision 7; 41A.17, subdivision 6; 41A.18, subdivision 6; and 41A.21, subdivision 6, are repealed.

Subd. 3. Plants, nurseries, and hemp. Minnesota Statutes 2022, sections 18H.02, subdivisions 21, 22, and 23; 18H.07, subdivisions 2 and 3; 18K.05; and 18K.09, are repealed.

Subd. 4. Emerging farmers. Minnesota Statutes 2022, section 17.055, subdivision 2, is repealed.

Subd. 5. Federal funds. Minnesota Statutes 2022, section 35.156, subdivision 2, is repealed.

EFFECTIVE DATE. This section is effective July 1, 2023, except subdivision 1 is effective July 1, 2024.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5405

ARTICLE 3

BROADBAND

Section 1. BROADBAND DEVELOPMENT APPROPRIATIONS.

The sums shown in the columns marked "Appropriations" are appropriated to the agencies and for the purposes specified in this article. The appropriations are from the general fund, or another named fund, and are available for the fiscal years indicated for each purpose. The figures "2024" and "2025" used in this article mean that the appropriations listed under them are available for the fiscal year ending June 30, 2024, or June 30, 2025, respectively. "The first year" is fiscal year 2024. "The second year" is fiscal year 2025. "The biennium" is fiscal years 2024 and 2025.

			APPROPRIATIONS
			Available for the Year
			Ending June 30
			2024	2025

Sec. 2. DEPARTMENT OF EMPLOYMENT AND ECONOMIC DEVELOPMENT

$73,350,000

$50,350,000

(a) $350,000 each year is for the Office of Broadband Development.

(b) $75,000,000 the first year and $50,000,000 the second year are for transfer to the border-to-border broadband fund account established in Minnesota Statutes, section 116J.396. Of the amount transferred each year, $20,000,000 is for lower population density program grants under Minnesota Statutes, section 116J.3952. This is a onetime appropriation.

Sec. 3. Minnesota Statutes 2022, section 116J.395, subdivision 7, is amended to read:

Subd. 7. Limitation. (a) No grant awarded under this section may fund more than 50 percent of the total cost of a project.

(b) Grants awarded to a single project under this section must not exceed ~~$5,000,000~~ $10,000,000.

Sec. 4. [116J.3952] LOWER POPULATION DENSITY GRANT PROGRAM.

Subdivision 1. Establishment. A lower population density grant program is established in the Department of Employment and Economic Development. The purpose of the lower population density grant program is to provide broadband service to unserved and underserved areas of the state where a 50 percent match formula is not adequate to make a business case for the extension of broadband facilities.

Subd. 2. Grants. Grants awarded under this section may fund up to 75 percent of the total cost of a project and must otherwise adhere to section 116J.395, subdivisions 1 to 6 and subdivision 7, paragraph (b).

Sec. 5. Minnesota Statutes 2022, section 116J.396, subdivision 2, is amended to read:

Subd. 2. Expenditures. Money in the account may be used only:

(1) for grant awards made under sections 116J.395 ~~and~~ to ~~116J.3951~~ 116J.3952, including costs incurred by the Department of Employment and Economic Development to administer that section;

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5406

(2) to supplement revenues raised by bonds sold by local units of government for broadband infrastructure development; or

(3) to contract for the collection of broadband deployment data from providers and the creation of maps showing the availability of broadband service.

Sec. 6. Laws 2022, chapter 95, article 4, section 2, is amended to read:

Sec. 2. LOWER POPULATION DENSITY PILOT PROGRAM.

(a) The commissioner of employment and economic development must establish a pilot program to provide broadband service to unserved and underserved areas, as defined in Minnesota Statutes, section 116J.394, of the state where a 50 percent match formula is not adequate to make a business case for the extension of broadband facilities. Grants awarded under this section shall adhere to all other requirements of Minnesota Statutes, section 116J.395, subdivisions 1 to 6, and may fund up to 75 percent of the total cost of a project, notwithstanding Minnesota Statutes section 116J.395, subdivision 7. Grants awarded to a single project under this section may not exceed $10,000,000.

(b) The commissioner of employment and economic development may use up to $30,000,000 from the appropriations in sections 3 and 4 for the lower population density pilot program under paragraph (a).

(c) No later than December 31, 2023, the Office of Broadband Development must submit a report to the chairs and ranking minority members of the senate and house of representatives committees with primary jurisdiction over broadband policy and finance analyzing the impacts of this section on the number and amounts of grants awarded under Minnesota Statutes, section 116J.395.

(d) This section expires December 31, 2026.

ARTICLE 4

GRANTS MANAGEMENT

Section 1. FINANCIAL REVIEW OF NONPROFIT GRANT RECIPIENTS REQUIRED.

Subdivision 1. Financial review required. (a) Before awarding a competitive, legislatively named, single‑source, or sole-source grant to a nonprofit organization under this act, the grantor must require the applicant to submit financial information sufficient for the grantor to document and assess the applicant's current financial standing and management. Items of significant concern must be addressed with the applicant and resolved to the satisfaction of the grantor before a grant is awarded. The grantor must document the material requested and reviewed; whether the applicant had a significant operating deficit, a deficit in unrestricted net assets, or insufficient internal controls; whether and how the applicant resolved the grantor's concerns; and the grantor's final decision. This documentation must be maintained in the grantor's files.

(b) At a minimum, the grantor must require each applicant to provide the following information:

(1) the applicant's most recent Form 990, Form 990-EZ, or Form 990-N filed with the Internal Revenue Service. If the applicant has not been in existence long enough or is not required to file Form 990, Form 990-EZ, or Form 990-N, the applicant must demonstrate to the grantor that the applicant is exempt and must instead submit documentation of internal controls and the applicant's most recent financial statement prepared in accordance with generally accepted accounting principles and approved by the applicant's board of directors or trustees or, if there is no such board, by the applicant's managing group;

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5407

(2) evidence of registration and good standing with the secretary of state under Minnesota Statutes, chapter 317A, or other applicable law;

(3) unless exempt under Minnesota Statutes, section 309.515, evidence of registration and good standing with the attorney general under Minnesota Statutes, chapter 309; and

(4) if required under Minnesota Statutes, section 309.53, subdivision 3, the applicant's most recent audited financial statement prepared in accordance with generally accepted accounting principles.

Subd. 2. Authority to postpone or forgo; reporting required. (a) Notwithstanding any contrary provision in this act, a grantor that identifies an area of significant concern regarding the financial standing or management of a legislatively named applicant may postpone or forgo awarding the grant.

(b) No later than 30 days after a grantor exercises the authority provided under paragraph (a), the grantor must report to the chairs and ranking minority members of the legislative committees with jurisdiction over the grantor's operating budget. The report must identify the legislatively named applicant and the grantor's reason for postponing or forgoing the grant.

Subd. 3. Authority to award subject to additional assistance and oversight. A grantor that identifies an area of significant concern regarding an applicant's financial standing or management may award a grant to the applicant if the grantor provides or the grantee otherwise obtains additional technical assistance, as needed, and the grantor imposes additional requirements in the grant agreement. Additional requirements may include but are not limited to enhanced monitoring, additional reporting, or other reasonable requirements imposed by the grantor to protect the interests of the state.

Subd. 4. Relation to other law and policy. The requirements in this section are in addition to any other requirements imposed by law; the commissioner of administration under Minnesota Statutes, sections 16B.97 and 16B.98; or agency policy."

Delete the title and insert:

"A bill for an act relating to state government; establishing a budget for the Department of Agriculture, the Board of Animal Health, the Agricultural Utilization Research Institute, and the Office of Broadband Development; transferring money to the border-to-border broadband fund account; making policy and technical changes to agriculture provisions; modifying fees; creating accounts; requiring reports; providing civil penalties; appropriating money; amending Minnesota Statutes 2022, sections 17.055, subdivision 1, by adding subdivisions; 17.1016, subdivision 2; 17.116, subdivision 3; 17.133, subdivision 3; 18B.01, subdivision 2b, by adding subdivisions; 18B.03, subdivision 1; 18B.04; 18B.051; 18B.055; 18C.425, subdivision 6; 18H.02, by adding a subdivision; 18H.03, subdivision 6; 18H.05; 18H.07, by adding subdivisions; 18H.08, subdivision 2; 18H.09; 18H.13, subdivision 3; 18H.15; 18K.04, subdivisions 1, 2; 18K.06; 25.39, subdivision 1; 28A.08, by adding a subdivision; 28A.082, subdivision 1; 28A.09, by adding a subdivision; 35.02, subdivision 1; 35.05; 41A.12, subdivision 4; 41A.16, subdivisions 1, 2; 41A.17, subdivisions 1, 2; 41A.18, subdivisions 1, 2; 41A.19; 116J.395, subdivision 7; 116J.396, subdivision 2; 223.16, by adding a subdivision; 223.17, subdivisions 7, 7a; 223.175; 223.19; 232.22, subdivision 5; Laws 2021, First Special Session chapter 3, article 1, section 2, subdivision 5, as amended; Laws 2022, chapter 95, article 2, section 29, subdivision 6; article 4, section 2; proposing coding for new law in Minnesota Statutes, chapters 17; 18B; 18K; 116J; 223; repealing Minnesota Statutes 2022, sections 17.055, subdivision 2; 18H.02, subdivisions 21, 22, 23; 18H.07, subdivisions 2, 3; 18K.05; 18K.09; 35.156, subdivision 2; 41A.16, subdivision 7; 41A.17, subdivision 6; 41A.18, subdivision 6; 41A.21, subdivision 6; 223.17, subdivisions 4, 8; 232.22, subdivisions 4, 6, 6a, 7."

With the recommendation that when so amended the bill be placed on the General Register.

The report was adopted.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5408

SECOND READING OF HOUSE BILLS

H. F. No. 24 was read for the second time.

SECOND READING OF SENATE BILLS

S. F. Nos. 10 and 1955 were read for the second time.

INTRODUCTION AND FIRST READING OF HOUSE BILLS

The following House Files were introduced:

Hudella, Dotseth, Knudsen, Bennett, Zeleznikar, Fogelman, Wiens, Engen, Joy, Newton, Myers, Scott, Bakeberg, Schultz and Swedzinski introduced:

H. F. No. 3257, A bill for an act relating to state government; requiring fiscal notes to include a review of certain information related to organizations named in legislation to receive a grant; requiring granting agencies to submit an annual report to the legislature on their grantmaking; amending Minnesota Statutes 2022, sections 3.98, subdivision 2, by adding a subdivision; 16B.98, by adding a subdivision.

The bill was read for the first time and referred to the Committee on State and Local Government Finance and Policy.

Daniels introduced:

H. F. No. 3258, A bill for an act relating to capital investment; appropriating money for municipal park development in the city of Faribault; authorizing the sale and issuance of state bonds.

The bill was read for the first time and referred to the Committee on Capital Investment.

Swedzinski introduced:

H. F. No. 3259, A bill for an act relating to game and fish; modifying muzzleloader provisions; amending Minnesota Statutes 2022, sections 97A.015, subdivision 51; 97B.031, subdivision 1.

The bill was read for the first time and referred to the Committee on Environment and Natural Resources Finance and Policy.

Nash, Mekeland and Swedzinski introduced:

H. F. No. 3260, A bill for an act relating to energy; authorizing certificates of need for certain small modular reactors; amending Minnesota Statutes 2022, section 216B.243, subdivision 3b.

The bill was read for the first time and referred to the Committee on Climate and Energy Finance and Policy.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5409

Freiberg introduced:

H. F. No. 3261, A bill for an act relating to taxation; imposing a gross receipts tax on certain digital products; appropriating money for payments to local governments; proposing coding for new law in Minnesota Statutes, chapter 295.

The bill was read for the first time and referred to the Committee on Taxes.

Joy and Knudsen introduced:

H. F. No. 3262, A bill for an act relating to capital investment; appropriating money for capital improvements and extensions of the Heartland Trail; authorizing the sale and issuance of state bonds.

The bill was read for the first time and referred to the Committee on Capital Investment.

Myers, Bakeberg, Davids and Witte introduced:

H. F. No. 3263, A bill for an act relating to transportation; taxes; establishing a temporary moratorium on imposition of the motor fuels tax; making transfers; appropriating money.

The bill was read for the first time and referred to the Committee on Transportation Finance and Policy.

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

RECESS

RECONVENED

The House reconvened and was called to order by Speaker pro tempore Wolgamott.

REPORT FROM THE COMMITTEE ON RULES

AND LEGISLATIVE ADMINISTRATION

Long from the Committee on Rules and Legislative Administration, pursuant to rules 1.21 and 3.33, designated the following bills to be placed on the Calendar for the Day for Thursday, April 20, 2023 and established a prefiling requirement for amendments offered to the following bills:

S. F. No. 1955; and H. F. Nos. 1587, 2292, 238 and 2497.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5410

CALENDAR FOR THE DAY

H. F. No. 1937 was reported to the House.

Newton moved to amend H. F. No. 1937, the second engrossment, as follows:

Page 3, line 25, delete "144,555,000" and insert "145,309,000"

Page 3, line 31, delete "55,045,000" and insert "55,799,000"

The motion prevailed and the amendment was adopted.

Olson, B., moved to amend H. F. No. 1937, the second engrossment, as amended, as follows:

Page 5, delete lines 15 to 35 and insert:

"(i) Posttraumatic stress disorder treatment. $400,000 each year is for a grant to the Mayo Clinic to provide posttraumatic stress disorder treatment to veterans and current military service members. To be eligible for services, a participant must be a resident of the state or assigned to a permanent duty station in the state pursuant to their military service. The base for this appropriation in fiscal year 2026 and each year thereafter is $200,000.

The Mayo Clinic must report to the commissioner of veterans affairs and the chairs and ranking minority members of the legislative committees with jurisdiction over veterans affairs policy and finance by January 15 of each year on the grant. The report must include a detailed explanation of how these appropriations were used, the number of veterans and service members served by the clinic, and a list and explanation of the services provided to participants."

Page 6, delete lines 1 to 6

Page 10, delete section 4

Renumber the sections in sequence and correct the internal references

Amend the title accordingly

The motion did not prevail and the amendment was not adopted.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5411

H. F. No. 1937, A bill for an act relating to state government; establishing a budget for the Department of Military Affairs and the Department of Veterans Affairs; modifying veterans bonus program and Minnesota GI bill program provisions; requiring reports; appropriating money; amending Minnesota Statutes 2022, sections 190.19, subdivision 2a; 197.236, subdivision 9; 197.79, subdivisions 1, 2, by adding a subdivision; 197.791, subdivisions 5, 6, 7; Laws 2021, First Special Session chapter 12, article 1, section 37, subdivision 2.

The bill was read for the third time, as amended, and placed upon its final passage.

The question was taken on the passage of the bill and the roll was called. There were 131 yeas and 0 nays as follows:

Those who voted in the affirmative were:

The motion did not prevail and the amendment was not adopted.

Quam moved to amend H. F. No. 1830, the second engrossment, as amended, as follows:

Page 145, after line 15, insert:

"ARTICLE 6

PROVISIONAL BALLOTING

Section 1. Minnesota Statutes 2022, section 171.072, is amended to read:

171.072 TRIBAL IDENTIFICATION CARD.

(a) If a Minnesota identification card is deemed an acceptable form of identification in Minnesota Statutes or Rules, a tribal identification card is also an acceptable form of identification. A tribal identification card is a primary document for purposes of Minnesota Rules, part 7410.0400, and successor rules, when an applicant applies for a noncompliant license or identification card.

(b) For purposes of this section, "tribal identification card" means an unexpired identification card issued by a Minnesota tribal government of a tribe recognized by the Bureau of Indian Affairs, United States Department of the Interior, that contains the legal name, date of birth, signature, and picture of the enrolled tribal member.

(c) The tribal identification card must contain security features that make it as impervious to alteration as is reasonably practicable in its design and quality of material and technology. The security features must use materials that are not readily available to the general public. The tribal identification card must not be susceptible to reproduction by photocopying or simulation and must be highly resistant to data or photograph substitution and other tampering.

(d) Except as provided in paragraph (a), the requirements of this section do not apply~~: (1) except as provided in paragraph (a),~~ to an application for a driver's license or Minnesota identification card under this chapter~~; or (2) to tribal identification cards used to prove an individual's residence for purposes of section 201.061, subdivision 3~~.

Sec. 2. Minnesota Statutes 2022, section 201.061, subdivision 1a, is amended to read:

Subd. 1a. Incomplete registration by mail. If ~~the county auditor determines that~~ a voter ~~who~~ has submitted a voter registration application by mail ~~has not previously voted in this state for a federal office and has also not presented a document authorized for election day registration in section 201.061, subdivision 3,~~ to the county

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5427

auditor, and the county auditor is unable to verify ~~the voter's driver's license, state identification, or last four digits of the voter's Social Security number as provided by the voter on the voter registration application~~ whether the voter is eligible to vote, then the county auditor must notify the voter that the registration is incomplete and to complete registration by using one of the following methods:

(1) ~~presenting to the auditor~~ submitting a completed voter registration application more than 20 days before the election ~~a document authorized for election day registration in section 201.061, subdivision 3~~;

(2) registering in person before or on election day; or

(3) if voting by absentee ballot or by mail, following election day registration procedures for absentee voters as described in section 203B.04, subdivision 4~~; or~~

~~(4) providing proof of residence by any of the methods authorized for election day registration in section 201.061, subdivision 3~~.

Sec. 3. Minnesota Statutes 2022, section 201.061, subdivision 3, is amended to read:

Subd. 3. Election day registration. (a) An individual who is eligible to vote may register on election day by appearing in person at the polling place for the precinct in which the individual maintains residence~~, by~~ and completing a voter registration application~~, making an oath in the form prescribed by the secretary of state and providing proof of residence. An individual may prove residence for purposes of registering by:~~.

~~(1) presenting a driver's license or Minnesota identification card issued pursuant to section 171.07;~~

~~(2) presenting any document approved by the secretary of state as proper identification;~~

~~(3) presenting one of the following:~~

(i) a current valid student identification card from a postsecondary educational institution in Minnesota, if a list of students from that institution has been prepared under section 135A.17 and certified to the county auditor in the manner provided in rules of the secretary of state; or

~~(ii) a current student fee statement that contains the student's valid address in the precinct together with a picture identification card; or~~

(4) having a voter who is registered to vote in the precinct, or an employee employed by and working in a residential facility in the precinct and vouching for a resident in the facility, sign an oath in the presence of the election judge vouching that the voter or employee personally knows that the individual is a resident of the precinct. A voter who has been vouched for on election day may not sign a proof of residence oath vouching for any other individual on that election day. A voter who is registered to vote in the precinct may sign up to eight proof‑of‑residence oaths on any election day. This limitation does not apply to an employee of a residential facility described in this clause. The secretary of state shall provide a form for election judges to use in recording the number of individuals for whom a voter signs proof-of-residence oaths on election day. The form must include space for the maximum number of individuals for whom a voter may sign proof-of-residence oaths. For each proof‑of-residence oath, the form must include a statement that the individual: (i) is registered to vote in the precinct or is an employee of a residential facility in the precinct, (ii) personally knows that the voter is a resident of the precinct, and (iii) is making the statement on oath. The form must include a space for the voter's printed name, signature, telephone number, and address.

~~Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5428~~

~~The oath required by this subdivision and Minnesota Rules, part 8200.9939, must be attached to the voter registration application.~~

(b) The operator of a residential facility shall prepare a list of the names of its employees currently working in the residential facility and the address of the residential facility. The operator shall certify the list and provide it to the appropriate county auditor no less than 20 days before each election for use in election day registration.

(c) "Residential facility" means transitional housing as defined in section 256E.33, subdivision 1; a supervised living facility licensed by the commissioner of health under section 144.50, subdivision 6; a nursing home as defined in section 144A.01, subdivision 5; a residence registered with the commissioner of health as a housing with services establishment as defined in section 144D.01, subdivision 4; a veterans home operated by the board of directors of the Minnesota Veterans Homes under chapter 198; a residence licensed by the commissioner of human services to provide a residential program as defined in section 245A.02, subdivision 14; a residential facility for persons with a developmental disability licensed by the commissioner of human services under section 252.28; setting authorized to provide housing support as defined in section 256I.03, subdivision 3; a shelter for battered women as defined in section 611A.37, subdivision 4; or a supervised publicly or privately operated shelter or dwelling designed to provide temporary living accommodations for the homeless.

~~(d) For tribal band members, an individual may prove residence for purposes of registering by:~~

(1) presenting an identification card issued by the tribal government of a tribe recognized by the Bureau of Indian Affairs, United States Department of the Interior, that contains the name, address, signature, and picture of the individual; or

(2) presenting an identification card issued by the tribal government of a tribe recognized by the Bureau of Indian Affairs, United States Department of the Interior, that contains the name, signature, and picture of the individual and also presenting one of the documents listed in Minnesota Rules, part 8200.5100, subpart 2, item B. For purposes of registration under this subdivision, the voter registration application must be printed on or affixed to a provisional ballot envelope and contain the information required by section 201.071, subdivision 1. An individual who registers on election day is entitled to cast a provisional ballot pursuant to section 204C.135.

~~(e)~~ (b) A county, school district, or municipality may require that an election judge responsible for election day registration initial each completed registration application.

Sec. 4. Minnesota Statutes 2022, section 201.061, subdivision 4, is amended to read:

Subd. 4. Registration by election judges; procedures. Registration at the polling place on election day shall be conducted by the election judges. Before registering an individual to vote at the polling place, the election judge must review any list of absentee election day registrants provided by the county auditor or municipal clerk to see if the person has already voted by absentee ballot. If the person's name appears on the list, the election judge must not allow the individual to register or to vote in the polling place. The election judge who registers an individual at the polling place on election day shall not handle that voter's ballots at any time prior to the opening of the ballot box after the voting ends. Registration applications ~~and forms for oaths~~ shall be available at each polling place. If an individual who registers on election day proves residence by oath of a registered voter, the form containing the oath shall be attached to the individual's registration application. Registration applications completed on election day shall be forwarded to the county auditor who shall add the name of each voter to the registration system unless the information forwarded is substantially deficient. A county auditor who finds an election day registration substantially deficient shall give written notice to the individual whose registration is found deficient. An election day registration shall not be found deficient solely because the individual who provided proof of residence was ineligible to do so.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5429

Sec. 5. Minnesota Statutes 2022, section 201.121, subdivision 1, is amended to read:

Subdivision 1. Entry of registration information. (a) At the time a voter registration application is properly completed, submitted, and received in accordance with sections 201.061 and 201.071, the county auditor shall enter the information contained on it into the statewide registration system. Voter registration applications completed before election day must be entered into the statewide registration system within ten days after they have been submitted to the county auditor, but no later than three days after the election. Voter registration applications completed on election day must be entered into the statewide registration system ~~within 42~~ as soon as possible, but no later than three days after the election, unless the county auditor notifies the secretary of state before the deadline has expired that the deadline will not be met. Upon receipt of a notification under this paragraph, the secretary of state must extend the deadline for that county auditor by an additional 28 days. The secretary of state may waive a county's obligations under this paragraph if, on good cause shown, the county demonstrates its permanent inability to comply.

The secretary of state must post data on each county's compliance with this paragraph on the secretary of state's website including, as applicable, the date each county fully complied or the deadline by which a county's compliance must be complete.

(b) Upon receiving a completed voter registration application, the secretary of state may electronically transmit the information on the application to the appropriate county auditor as soon as possible for review by the county auditor before final entry into the statewide registration system. The secretary of state may mail the voter registration application to the county auditor.

(c) Within ten days after the county auditor has entered information from a voter registration application into the statewide registration system, the secretary of state shall compare the voter's name, date of birth, and driver's license number, state identification number, or the last four digits of the Social Security number with the same information contained in the Department of Public Safety database. For applications received on election day, this must be completed within three days after the county auditor or municipal clerk has entered the information into the statewide voter registration system.

(d) The secretary of state shall provide a report to the county auditor on a weekly basis that includes a list of voters whose name, date of birth, or identification number have been compared with the same information in the Department of Public Safety database and cannot be verified as provided in this subdivision. The report must list separately those voters who have submitted a voter registration application by mail and have not voted in a federal election in this state. For the six days following an election, the secretary of state must provide this report daily to county auditors and municipal clerks.

(e) The county auditor shall compile a list of voters for whom the county auditor and the secretary of state are unable to conclude that information on the voter registration application and the corresponding information in the Department of Public Safety database relate to the same person.

(f) The county auditor shall send a notice of incomplete registration to any voter whose name appears on the list and change the voter's status to "incomplete." A voter who receives a notice of incomplete registration from the county auditor may either provide the information required to complete the registration at least 21 days before the next election or at the polling place on election day.

Sec. 6. Minnesota Statutes 2022, section 201.225, subdivision 2, is amended to read:

Subd. 2. Technology requirements. An electronic roster must:

(1) be able to be loaded with a data file that includes voter registration data in a file format prescribed by the secretary of state;

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5430

(2) allow for data to be exported in a file format prescribed by the secretary of state;

(3) allow for data to be entered manually or by scanning a Minnesota driver's license or identification card to locate a voter record or populate a voter registration application that would be printed and signed and dated by the voter~~. The printed registration application can be either a printed form, labels printed with voter information to be affixed to a preprinted form, or a combination of both~~ and affixed to the provisional ballot envelope;

(4) allow an election judge to update data that was populated from a scanned driver's license or identification card;

(5) cue an election judge to ask for and input data that is not populated from a scanned driver's license or identification card that is otherwise required to be collected from the voter or an election judge;

(6) immediately alert the election judge if the voter has provided information that indicates that the voter is not eligible to vote;

(7) immediately alert the election judge if the electronic roster indicates that a voter has already voted in that precinct, the voter's registration status is challenged, or it appears the voter resides in a different precinct;

(8) provide immediate instructions on how to resolve a particular type of challenge when a voter's record is challenged;

(9) provide for a printed voter signature certificate, containing the voter's name, address of residence, date of birth, voter identification number, the oath required by section 204C.10, and a space for the voter's original signature. The printed voter signature certificate can be either a printed form or a label printed with the voter's information to be affixed to the oath;

(10) contain only preregistered voters within the precinct, and not contain preregistered voter data on voters registered outside of the precinct;

(11) be only networked within the polling location on election day, except for the purpose of updating absentee ballot records;

(12) meet minimum security, reliability, and networking standards established by the Office of the Secretary of State in consultation with the Department of Information Technology Services;

(13) be capable of providing a voter's correct polling place; and

(14) perform any other functions necessary for the efficient and secure administration of the participating election, as determined by the secretary of state.

Electronic rosters used only for election day registration do not need to comply with clauses (1), (8), and (10). Electronic rosters used only for preregistered voter processing do not need to comply with clauses (4) and (5).

Sec. 7. Minnesota Statutes 2022, section 201.225, subdivision 5, is amended to read:

Subd. 5. Election day. (a) Precincts may use electronic rosters for election day registration, to process preregistered voters, or both. ~~The printed election day registration applications must be reviewed when electronic records are processed in the statewide voter registration system.~~ The election judges shall determine the number of ballots to be counted by counting the number of original voter signature certificates or the number of voter receipts.

(b) Each precinct using electronic rosters shall have a paper backup system approved by the secretary of state present at the polling place to use in the event that the election judges are unable to use the electronic roster.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5431

Sec. 8. Minnesota Statutes 2022, section 203B.04, subdivision 4, is amended to read:

Subd. 4. Registration at time of application. An eligible voter who is not registered to vote but who is otherwise eligible to vote by absentee ballot may register by ~~including~~ submitting a completed voter registration application with the absentee ballot. ~~The individual shall present proof of residence as required by section 201.061, subdivision 3, to the individual who witnesses the marking of the absentee ballots~~ If the absentee ballot and voter registration application are returned by mail, the voter registration must be placed into the return envelope along with the signature envelope. A military voter, as defined in section 203B.01, may register in this manner if voting pursuant to sections 203B.04 to 203B.15, or may register pursuant to sections 203B.16 to 203B.27.

Sec. 9. Minnesota Statutes 2022, section 203B.07, subdivision 3, is amended to read:

Subd. 3. Eligibility certificate. A certificate of eligibility to vote by absentee ballot shall be printed on the back of the return envelope. The certificate shall contain space for the voter's Minnesota driver's license number, state identification number, or the last four digits of the voter's Social Security number, or to indicate that the voter does not have one of these numbers. The space must be designed to ensure that the voter provides the same type of identification as provided on the voter's absentee ballot application for purposes of comparison. The certificate must also contain a statement to be signed and sworn by the voter indicating that the voter meets all of the requirements established by law for voting by absentee ballot and space for a statement signed by a person who is registered to vote in Minnesota or by a notary public or other individual authorized to administer oaths stating that:

(1) the ballots were displayed to that individual unmarked; and

(2) the voter marked the ballots in that individual's presence without showing how they were marked, or, if the voter was physically unable to mark them, that the voter directed another individual to mark them~~; and~~

~~(3) if the voter was not previously registered, the voter has provided proof of residence as required by section 201.061, subdivision 3~~.

Sec. 10. Minnesota Statutes 2022, section 203B.08, subdivision 3, is amended to read:

Subd. 3. Procedures on receipt of ballots. (a) When absentee ballots are returned to a county auditor or municipal clerk, that official shall stamp or initial and date the return envelope ~~and~~. The county auditor must open the return envelope to determine if a voter registration application is in the envelope. If a voter registration application is in the envelope, the county auditor must remove the voter registration application. The county auditor must reseal the return envelope, initial across the seal, and note that a voter registration application was removed from the envelope. The county auditor must place it all return envelopes in a locked ballot container or other secured and locked space with other return envelopes received by that office. Except for voter registration applications removed pursuant to this section, all contents of the return envelope must remain in the return envelope until delivered to the ballot board.

(b) Within five days after receipt, the county auditor or municipal clerk shall deliver to the ballot board all ballots received, except that during the 14 days immediately preceding an election, the county auditor or municipal clerk shall deliver all ballots received to the ballot board within three days. Ballots received on election day either (1) after 3:00 p.m., if delivered in person; or (2) after 8:00 p.m., if delivered by mail or a package delivery service, shall be marked as received late by the county auditor or municipal clerk, and must not be delivered to the ballot board.

(c) Upon removing the voter registration application as required by paragraph (a), the county auditor must promptly process the voter registration application as provided in section 201.121, subdivisions 1 and 2.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5432

Sec. 11. Minnesota Statutes 2022, section 203B.081, subdivision 3, is amended to read:

Subd. 3. Alternative procedure. (a) The county auditor may make available a ballot counter and ballot box for use by ~~the~~ preregistered voters during the seven days before the election. If a ballot counter and ballot box is provided, a voter must be given the option either (1) to vote using the process provided in section 203B.08, subdivision 1, or (2) to vote in the manner provided in this subdivision.

(b) If a voter chooses to vote in the manner provided in this subdivision, the voter must state the voter's name, address, and date of birth to the county auditor or municipal clerk. The voter shall sign a voter's certificate, which must include the voter's name, identification number, and the certification required by section 201.071, subdivision 1. The signature of an individual on the voter's certificate and the issuance of a ballot to the individual is evidence of the intent of the individual to vote at that election.

(c) After signing the voter's certificate, the voter shall be issued a ballot and immediately retire to a voting station or other designated location in the polling place to mark the ballot. The ballot must not be taken from the polling place. If the voter spoils the ballot, the voter may return it to the election official in exchange for a new ballot. After completing the ballot, the voter shall deposit the ballot into the ballot box.

(d) The election official must immediately record that the voter has voted in the manner provided in section 203B.121, subdivision 3.

(e) The election duties required by this subdivision must be performed by the county auditor, municipal clerk, or a deputy of the auditor or clerk.

(f) If a person is not registered to vote, the person must not be allowed to cast an absentee ballot using the alternative procedure authorized by this subdivision.

Sec. 12. Minnesota Statutes 2022, section 203B.121, subdivision 2, is amended to read:

Subd. 2. Duties of ballot board; absentee ballots. (a) The members of the ballot board shall take possession of all signature envelopes delivered to them in accordance with section 203B.08. Upon receipt from the county auditor, municipal clerk, or school district clerk, two or more members of the ballot board shall examine each signature envelope and shall mark it accepted or rejected in the manner provided in this subdivision. Election judges performing the duties in this section must be of different major political parties, unless they are exempt from that requirement under section 205.075, subdivision 4, or section 205A.10, subdivision 2.

(b) The members of the ballot board shall mark the signature envelope "Accepted" and initial or sign the signature envelope below the word "Accepted" if a majority of the members of the ballot board examining the envelope are satisfied that:

(1) the voter's name and address on the signature envelope are the same as the information provided on the absentee ballot application;

(2) the voter signed the certification on the envelope;

(3) the voter's Minnesota driver's license, state identification number, or the last four digits of the voter's Social Security number are the same as a number on the voter's absentee ballot application or voter record. If the number does not match, the election judges must compare the signature provided by the applicant to determine whether the ballots were returned by the same person to whom they were transmitted;

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5433

(4) the voter is registered and eligible to vote in the precinct ~~or has included a properly completed voter registration application in the signature envelope~~;

(5) the certificate has been completed as prescribed in the directions for casting an absentee ballot; and

(6) the voter has not already voted at that election, either in person or, if it is after the close of business on the seventh day before the election, by absentee ballot.

The signature envelope from accepted ballots must be preserved and returned to the county auditor.

(c)(1) If a majority of the members of the ballot board examining a signature envelope find that an absentee voter has failed to meet one of the requirements provided in paragraph (b), they shall mark the signature envelope "Rejected," initial or sign it below the word "Rejected," list the reason for the rejection on the envelope, and return it to the county auditor. There is no other reason for rejecting an absentee ballot beyond those permitted by this section. Failure to place the ballot within the secrecy envelope before placing it in the outer white envelope is not a reason to reject an absentee ballot.

(2) If an envelope has been rejected at least five days before the election, the envelope must remain sealed and the official in charge of the ballot board shall provide the voter with a replacement absentee ballot and signature envelope in place of the rejected ballot.

(3) If an envelope is rejected within five days of the election, the envelope must remain sealed and the official in charge of the ballot board must attempt to contact the voter by telephone or email to notify the voter that the voter's ballot has been rejected. The official must document the attempts made to contact the voter.

(d) The official in charge of the absentee ballot board must mail the voter a written notice of absentee ballot rejection between six and ten weeks following the election. If the official determines that the voter has otherwise cast a ballot in the election, no notice is required. If an absentee ballot arrives after the deadline for submission provided by this chapter, the notice must be provided between six to ten weeks after receipt of the ballot. A notice of absentee ballot rejection must contain the following information:

(1) the date on which the absentee ballot was rejected or, if the ballot was received after the required deadline for submission, the date on which the ballot was received;

(2) the reason for rejection; and

(3) the name of the appropriate election official to whom the voter may direct further questions, along with appropriate contact information.

(e) An absentee ballot signature envelope marked "Rejected" may not be opened or subject to further review except in an election contest filed pursuant to chapter 209.

Sec. 13. Minnesota Statutes 2022, section 204C.07, subdivision 3a, is amended to read:

Subd. 3a. Residence requirement. A challenger must be a resident of this state. Appointed challengers seeking admission to a polling place to serve in that capacity must prove their status as a resident of this state by presenting ~~one of the documents listed in section 201.061, subdivision 3.~~ a driver's license or Minnesota identification card issued pursuant to section 171.07, any document approved by the secretary of state as proper identification, or one of the following:

(1) a current valid student identification card from a postsecondary educational institution in Minnesota, if a list of students from that institution has been prepared under section 135A.17 and certified to the county auditor in the manner provided in rules of the secretary of state; or

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5434

(2) a current student fee statement that contains the student's valid address in the precinct together with a picture identification card.

Challengers need not prove residence in the precinct in which they seek to act as a challenger.

Sec. 14. [204C.135] PROVISIONAL BALLOTS.

Subdivision 1. Casting provisional ballots. (a) A voter who registers on election day or at the time of submitting a ballot in person during the early voting period is only entitled to cast a provisional ballot.

(b) A voter seeking to cast a provisional ballot must sign a provisional ballot roster or a provisional voter signature certificate and complete the voter registration application on the provisional ballot envelope. The voter registration application may be completed by an electronic roster and affixed to the provisional ballot envelope. The voter must also swear or affirm in writing that the voter is eligible to vote, has not voted previously in the same election, and meets the criteria for registering to vote in the precinct in which the voter appears.

(c) Once the voter has completed the provisional ballot envelope, the voter must be allowed to cast a provisional ballot. The provisional ballot must be in the same form as the official ballot available in the precinct on election day. A completed provisional ballot shall be sealed in a secrecy envelope. The secrecy envelope shall be sealed inside the voter's provisional ballot envelope and deposited by the voter in a secure, sealed provisional ballot box. Completed provisional ballots must not be combined with other voted ballots in the polling place.

(d) The secretary of state must prescribe the form of the secrecy and provisional ballot envelopes. The provisional ballot envelope must be a color other than that provided for absentee ballot envelopes and must be prominently labeled "Provisional Ballot Envelope."

(e) Provisional ballots and related documentation shall be delivered to and securely maintained by the county auditor or municipal clerk in the same manner as required for other election materials under sections 204C.27 and 204C.28.

Subd. 2. Accepting or rejecting provisional ballot envelopes. (a) Beginning four days after the election and finishing no later than seven days after the election, the county auditor or municipal clerk must process each applicant's provisional ballot envelope. If the applicant is registered to vote, that voter's provisional ballot envelope must be accepted. The county auditor or municipal clerk must mark the provisional ballot envelope "Accepted" and initial or sign the envelope below the word "Accepted." If the applicant is not registered to vote, the provisional ballot envelope must be rejected. If a provisional ballot envelope is rejected, the county auditor or municipal clerk must mark the provisional ballot envelope "Rejected," initial or sign it below the word "Rejected," and list the reason for rejection on the envelope. The county auditor or municipal clerk must promptly record in the statewide voter registration system that a voter's provisional ballot envelope has been accepted or rejected.

(b) The county auditor or municipal clerk must mail the voter a written notice of provisional ballot rejection between six and ten weeks following the election. The notice must include the reason for rejection and the name of the appropriate election official to whom the voter may direct further questions, along with appropriate contact information.

(c) A provisional ballot envelope marked "Rejected" may not be opened or subject to further review except in an election contest filed pursuant to chapter 209.

Subd. 3. Provisional ballots; reconciliation. On the seventh day after the election and prior to counting any provisional ballots in the final vote totals from a precinct, the county auditor or municipal clerk must verify that the number of signatures appearing on the provisional ballot roster from that precinct is equal to or greater than the

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5435

number of provisional ballots submitted by voters in the precinct on election day. Any discrepancy must be resolved before the provisional ballots from the precinct may be counted. Excess provisional ballots must be randomly withdrawn from the accepted provisional ballots in the manner required by section 204C.20, subdivision 2.

Subd. 4. Counting provisional ballots. Once the reconciliation process required by subdivision 3 is completed, accepted provisional ballot envelopes must be opened; duplicated as needed in the manner provided in section 206.86, subdivision 5; initialed by the members of the ballot board; and deposited in the appropriate ballot box. If more than one ballot is enclosed in the ballot envelope, the ballots must be spoiled and must not be counted.

Sec. 15. Minnesota Statutes 2022, section 204C.32, is amended to read:

204C.32 CANVASS OF STATE PRIMARIES.

Subdivision 1. County canvass. The county canvassing board shall meet at the county auditor's office on ~~either the second or third~~ the tenth day following the state primary. After taking the oath of office, the canvassing board shall publicly canvass the election returns delivered to the county auditor. The board shall complete the canvass by the ~~third~~ tenth day following the state primary and shall promptly prepare and file with the county auditor a report that states:

(a) the number of individuals voting at the election in the county, and in each precinct;

(b) the number of individuals registering to vote on election day and the number of individuals registered before election day in each precinct;

(c) for each major political party, the names of the candidates running for each partisan office and the number of votes received by each candidate in the county and in each precinct;

(d) the names of the candidates of each major political party who are nominated; and

(e) the number of votes received by each of the candidates for nonpartisan office in each precinct in the county and the names of the candidates nominated for nonpartisan office.

Upon completion of the canvass, the county auditor shall mail or deliver a notice of nomination to each nominee for county office voted for only in that county. The county auditor shall transmit one of the certified copies of the county canvassing board report for state and federal offices to the secretary of state by express mail or similar service immediately upon conclusion of the county canvass. The secretary of state shall mail a notice of nomination to each nominee for state or federal office.

Subd. 2. State canvass. The State Canvassing Board shall meet at a public meeting space located in the Capitol complex area ~~seven~~ 14 days after the state primary to canvass the certified copies of the county canvassing board reports received from the county auditors. Immediately after the canvassing board declares the results, the secretary of state shall certify the names of the nominees to the county auditors. The secretary of state shall mail to each nominee a notice of nomination.

Sec. 16. Minnesota Statutes 2022, section 204C.33, subdivision 1, is amended to read:

Subdivision 1. County canvass. The county canvassing board shall meet at the county auditor's office between the ~~third~~ tenth and ~~tenth~~ 17th days following the state general election. After taking the oath of office, the board shall promptly and publicly canvass the general election returns delivered to the county auditor. Upon completion of the canvass, the board shall promptly prepare and file with the county auditor a report which states:

(a) the number of individuals voting at the election in the county and in each precinct;

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5436

(b) the number of individuals registering to vote on election day and the number of individuals registered before election day in each precinct;

(c) the names of the candidates for each office and the number of votes received by each candidate in the county and in each precinct;

(d) the number of votes counted for and against a proposed change of county lines or county seat; and

(e) the number of votes counted for and against a constitutional amendment or other question in the county and in each precinct.

The result of write-in votes cast on the general election ballots must be compiled by the county auditor before the county canvass, except that write-in votes for a candidate for federal, state, or county office must not be counted unless the candidate has timely filed a request under section 204B.09, subdivision 3. The county auditor shall arrange for each municipality to provide an adequate number of election judges to perform this duty or the county auditor may appoint additional election judges for this purpose. The county auditor may open the envelopes or containers in which the voted ballots have been sealed in order to count and record the write-in votes and must reseal the voted ballots at the conclusion of this process. The county auditor must prepare a separate report of votes received by precinct for write-in candidates for federal, state, and county offices who have requested under section 204B.09 that votes for those candidates be tallied.

Upon completion of the canvass, the county canvassing board shall declare the candidate duly elected who received the highest number of votes for each county and state office voted for only within the county. The county auditor shall transmit a certified copy of the county canvassing board report for state and federal offices to the secretary of state by messenger, express mail, or similar service immediately upon conclusion of the county canvass.

Sec. 17. Minnesota Statutes 2022, section 204C.37, is amended to read:

204C.37 COUNTY CANVASS; RETURN OF REPORTS TO SECRETARY OF STATE.

A copy of the report required by sections 204C.32, subdivision 1, and 204C.33, subdivision 1, shall be certified under the official seal of the county auditor. The copy shall be enclosed in an envelope addressed to the secretary of state, with the county auditor's name and official address and the words "Election Returns" endorsed on the envelope. The copy of the canvassing board report must be sent by express mail or delivered to the secretary of state. If the copy is not received by the secretary of state within ~~ten~~ 17 days following ~~the applicable election~~ a primary election, or within 24 days following a general election, the secretary of state shall immediately notify the county auditor, who shall deliver another copy to the secretary of state by special messenger.

Sec. 18. Minnesota Statutes 2022, section 205.065, subdivision 5, is amended to read:

Subd. 5. Results. The municipal primary shall be conducted and the returns made in the manner provided for the state primary so far as practicable. ~~The canvass may be conducted on either the second or third day after the primary.~~

The governing body of the municipality shall canvass the returns on the tenth day after the primary, and the two candidates for each office who receive the highest number of votes, or a number of candidates equal to twice the number of individuals to be elected to the office, who receive the highest number of votes, shall be the nominees for the office named. Their names shall be certified to the municipal clerk who shall place them on the municipal general election ballot without partisan designation and without payment of an additional fee.

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5437

Sec. 19. Minnesota Statutes 2022, section 205.185, subdivision 3, is amended to read:

Subd. 3. Canvass of returns, certificate of election, ballots, disposition. (a) Between the ~~third~~ tenth and ~~tenth~~ 17th days after an election, the governing body of a city conducting any election including a special municipal election, or the governing body of a town conducting the general election in November shall act as the canvassing board, canvass the returns, and declare the results of the election. The governing body of a town conducting the general election in March shall act as the canvassing board, canvass the returns, and declare the results of the election within ~~two~~ nine days after an election.

(b) After the time for contesting elections has passed, the municipal clerk shall issue a certificate of election to each successful candidate. In case of a contest, the certificate shall not be issued until the outcome of the contest has been determined by the proper court.

(c) In case of a tie vote, the canvassing board having jurisdiction over the municipality shall determine the result by lot. The clerk of the canvassing board shall certify the results of the election to the county auditor, and the clerk shall be the final custodian of the ballots and the returns of the election.

Sec. 20. Minnesota Statutes 2022, section 205A.03, subdivision 4, is amended to read:

Subd. 4. Results. ~~(a)~~ The school district primary must be conducted and the returns made in the manner provided for the state primary as far as practicable. ~~If the primary is conducted:~~

~~(1) only within that school district, a canvass may be conducted on either the second or third day after the primary; or~~

~~(2) in conjunction with the state primary, the canvass must be conducted on the third day after the primary, except as otherwise provided in paragraph (b).~~

On the tenth day after the primary, the school board of the school district shall canvass the returns, and the two candidates for each specified school board position who receive the highest number of votes, or a number of candidates equal to twice the number of individuals to be elected to at-large school board positions who receive the highest number of votes, are the nominees for the office named. Their names must be certified to the school district clerk who shall place them on the school district general election ballot without partisan designation and without payment of an additional fee.

(b) Following a school district primary as described in paragraph (a), clause (2), a canvass may be conducted on the second day after the primary if the county auditor of each county in which the school district is located agrees to administratively review the school district's primary voting statistics for accuracy and completeness within a time that permits the canvass to be conducted on that day.

Sec. 21. Minnesota Statutes 2022, section 205A.10, subdivision 3, is amended to read:

Subd. 3. Canvass of returns, certificate of election, ballots, disposition. Between the ~~third~~ tenth and ~~tenth~~ 17th days after a school district election other than a recount of a special election conducted under section 126C.17, subdivision 9, or 475.59, the school board shall canvass the returns and declare the results of the election. After the time for contesting elections has passed, the school district clerk shall issue a certificate of election to each successful candidate. If there is a contest, the certificate of election to that office must not be issued until the outcome of the contest has been determined by the proper court. If there is a tie vote, the school board shall determine the result by lot. The clerk shall deliver the certificate of election to the successful candidate by personal service or certified mail. The successful candidate shall file an acceptance and oath of office in writing with the clerk within 30 days of the date of mailing or personal service. A person who fails to qualify prior to the time

Journal of the House - 51st Day - Tuesday, April 18, 2023 - Top of Page 5438

specified shall be deemed to have refused to serve, but that filing may be made at any time before action to fill the vacancy has been taken. The school district clerk shall certify the results of the election to the county auditor, and the clerk shall be the final custodian of the ballots and the returns of the election.

A school district canvassing board shall perform the duties of the school board according to the requirements of this subdivision for a recount of a special election conducted under section 126C.17, subdivision 9, or 475.59.

Sec. 22. PUBLIC AWARENESS CAMPAIGN; SECRETARY OF STATE.

The secretary of state must conduct a public awareness campaign to encourage people to register to vote prior to election day. At a minimum, the secretary of state must conduct the public awareness campaign in each even‑numbered year from June 1 until the voter registration period ends prior to the state general election.

Sec. 23. REPEALER.

Minnesota Statutes 2022, sections 135A.17, subdivision 2; 201.061, subdivision 7; and 201.121, subdivision 3, are repealed.

Sec. 24. EFFECTIVE DATE.

This article is effective on January 1, 2024, and applies to elections held on or after that date."

Renumber the articles in sequence and correct the internal references

Amend the title accordingly

A roll call was requested and properly seconded.

The question was taken on the Quam amendment and the roll was called. There were 61 yeas and 70 nays as follows:

Those who voted in the affirmative were: