House Journal 110th Day May 2 2024

A quorum was present.

Daniels and Kozlowski were excused.

O'Driscoll was excused until 1:45 p.m. Urdahl was excused until 2:45 p.m.

The Speaker assumed the Chair.

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 - 110th Day - Thursday, May 2, 2024 - Top of Page 15436

REPORTS OF STANDING COMMITTEES AND DIVISIONS

Gomez from the Committee on Taxes to which was referred:

H. F. No. 2000, A bill for an act relating to gambling; authorizing and providing for sports betting and fantasy contests; establishing licenses; prohibiting local restrictions; providing for taxation of sports betting and fantasy contests; providing civil and criminal penalties; providing for amateur sports grants; providing for charitable gambling; providing for pari-mutuel horse racing; requiring reports; appropriating money; amending Minnesota Statutes 2022, sections 240.01, subdivisions 1c, 8, 14, by adding a subdivision; 240.30, subdivision 8; 245.98, subdivision 2; 260B.007, subdivision 16; 349.12, by adding a subdivision; 609.75, subdivisions 3, 4, 7, by adding subdivisions; 609.755; 609.76, subdivision 2; Minnesota Statutes 2023 Supplement, sections 297E.02, subdivision 6; 349.12, subdivision 25; proposing coding for new law in Minnesota Statutes, chapters 240; 240A; 299L; 609; proposing coding for new law as Minnesota Statutes, chapters 297J; 297K; 349C.

Reported the same back with the following amendments:

Page 5, delete lines 9 to 13 and insert:

"Subd. 21. Sports governing body. "Sports governing body" means an organization that prescribes and enforces final rules and codes of conduct for a sporting event and participants engaged in the sport. For a sporting event sanctioned by a higher education institution, "sports governing body" means the athletic conference to which the institution belongs. For an esports event, "sports governing body" means the video game publisher of the title used in the esports competition."

Page 9, line 28, delete "as defined in section 270C.72" and insert "penalties, or interest, with delinquent taxes subject to the limitations under section 270C.72, subdivision 2"

Page 15, line 10, delete "A" and insert "For initial licensure and subsequent license renewal, a"

Page 15, line 27, delete "A" and insert "For initial licensure and subsequent license renewal, a"

Page 21, line 17, delete "trainer" and insert "health care provider"

Page 23, line 31, delete "three" and insert "3-1/2"

Page 25, line 2, delete ", the commissioner of revenue,"

Page 26, line 5, delete "fees" and insert "license fees or penalties"

Page 29, after line 9, insert:

"Section 1. Minnesota Statutes 2022, section 270B.07, is amended by adding a subdivision to read:

Subd. 6. Disclosure to Department of Public Safety. The commissioner may disclose return information to the commissioner of public safety for the purpose of verifying licensure requirements under sections 299L.25 and 349C.03.

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

Journal of the House - 110th Day - Thursday, May 2, 2024 - Top of Page 15437

Page 29, after line 12, insert:

"(1) "cash equivalent" means the cash value of any free bets, promotional credits, and any other noncash form of consideration, payment, or compensation;"

Renumber the clauses in sequence

Page 29, line 23, delete "cash equivalent" and insert "fair market value"

Page 30, delete lines 16 to 25

Renumber the subdivisions in sequence

Page 31, line 6, delete "under subdivision 5"

Page 32, line 3, delete "as it relates to financial reporting" and insert ", including failure to timely file returns or pay tax, or take corrective actions required by the commissioner"

Page 32, delete section 4 and insert:

"Sec. 5. [297J.04] OTHER PROVISIONS APPLY.

Except for those provisions specific to distributors, gambling products, or gambling equipment, sections 297E.02, subdivisions 9 and 10, and 297E.10 to 297E.14 apply to this chapter."

Page 36, after line 3, insert:

"(b) Rules for which notice is published in the State Register before January 1, 2025, may be adopted using the expedited rulemaking process in section 14.389."

Page 36, line 19, delete "as defined in section 270C.72" and insert "penalties, or interest, with delinquent taxes subject to the limitations under section 270C.72, subdivision 2"

Page 43, line 26, delete "trainer" and insert "health care provider"

Page 45, line 10, delete "three" and insert "3-1/2"

Page 46, line 16, delete "fees" and insert "license fees or penalties"

Page 48, delete lines 6 to 9 and insert:

"Subd. 2. Adjusted gross fantasy contest receipts. "Adjusted gross fantasy contest receipts" means the amount equal to the total of all entry fees that a fantasy contest operator receives from all participants minus the total of cash prizes and the fair market value of noncash prizes paid as winnings to all participants multiplied by the location percentage for this state.

Subd. 3. Cash equivalent. "Cash equivalent" means the cash value of any free bets, promotional credits, and any other noncash form of consideration, payment, or compensation."

Journal of the House - 110th Day - Thursday, May 2, 2024 - Top of Page 15438

Page 48, after line 10, insert:

"Subd. 5. Entry fee. "Entry fee" means cash or cash equivalent that is required to be paid by an authorized participant and set in advance by a fantasy contest operator to participate in a fantasy contest."

Page 48, lines 16 and 17, delete "collected" and insert "received"

Page 48, delete line 19 and insert:

"Subd. 9. Wager. "Wager" means a transaction between an authorized participant and a licensed fantasy contest operator in which an authorized participant pays, deposits, or risks cash or a cash equivalent as an entry fee into a fantasy contest."

Renumber the subdivisions in sequence

Page 49, delete lines 3 to 11

Renumber the subdivisions in sequence

Page 49, line 23, delete "the financial"

Page 49, line 24, delete "reporting requirements under this chapter" and insert "this chapter, including failure to timely file returns or pay tax, or take corrective actions required by the commissioner"

Page 49, after line 30, insert:

"Sec. 4. [297K.04] OTHER PROVISIONS APPLY.

Except for those provisions specific to distributors, gambling products, or gambling equipment, sections 297E.02, subdivisions 9 and 10, and 297E.10 to 297E.14 apply to this chapter.

EFFECTIVE DATE. This section is effective for adjusted gross fantasy receipts received after June 30, 2024."

Page 61, delete section 1 and insert:

"Section. 1. Minnesota Statutes 2023 Supplement, section 297E.02, subdivision 6, is amended to read:

Subd. 6. Combined net receipts tax. (a) In addition to the taxes imposed under subdivision 1, a tax is imposed on the combined net receipts of the organization. As used in this section, "combined net receipts" is the sum of the organization's gross receipts from lawful gambling less gross receipts directly derived from the conduct of paper bingo, raffles, and paddlewheels, as defined in section 297E.01, subdivision 8, and less the net prizes actually paid, other than prizes actually paid for paper bingo, raffles, and paddlewheels, for the fiscal year. The combined net receipts of an organization are subject to a tax computed according to the following schedule:

	If the combined net receipts for the fiscal year are:		The tax is:
	Not over $87,500		eight percent
	Over $87,500, but not over $122,500		$7,000 plus 17 percent of the amount over $87,500, but not over $122,500
	Over $122,500, but not over $157,500		$12,950 plus 25 percent of the amount over $122,500, but not over $157,500
	Over $157,500		$21,700 plus 33.5 percent of the amount over $157,500

Journal of the House - 110th Day - Thursday, May 2, 2024 - Top of Page 15439

(b) On or before April 1, 2025, the commissioner shall estimate the total amount of revenue, including interest and penalties, that will be collected for fiscal year 2026 from taxes imposed under sections 297J.02 and 297K.02. If the amount estimated by the commissioner equals or exceeds $6,900,000, the commissioner shall certify that effective July 1, 2025, the rates under this paragraph apply in lieu of the rates imposed under paragraph (a). If the rates under this paragraph apply, the combined net receipts of an organization are subject to a tax computed according to the following schedule:

	If the combined net receipts for the fiscal year are:		The tax is:
	Not over $87,500		5.5 percent
	Over $87,500, but not over $122,500		$4,813 plus 15 percent of the amount over $87,500, but not over $122,500
	Over $122,500, but not over $157,500		$5,250 plus 23 percent of the amount over $122,500, but not over $157,500
	Over $157,500		$8,050 plus 32.5 percent of the amount over $157,500

(c) On or before April 1, 2026, the commissioner shall estimate the total amount of revenue, including interest and penalties, that will be collected for fiscal year 2027 from taxes imposed under sections 297J.02 and 297K.02. If the amount estimated by the commissioner equals or exceeds $27,100,000, the commissioner shall certify that effective July 1, 2026, the rates under this paragraph apply in lieu of the rates imposed under paragraph (a) or (b) and shall publish a notice to the effect in the state registry and notify taxpayers by June 1, 2026. If the rates under this paragraph apply, the combined net receipts of an organization are subject to a tax computed according to the following schedule:

	If the combined net receipts for the fiscal year are:		The tax is:
	Not over $87,500		four percent
	Over $87,500, but not over $122,500		$3,500 plus 13 percent of the amount over $87,500, but not over $122,500
	Over $122,500, but not over $157,500		$4,550 plus 20 percent of the amount over $122,500, but not over $157,500
	Over $157,500		$7,000 plus 28.5 percent of the amount over $157,500

(d) On or before April 1, 2027, the commissioner shall estimate the total amount of revenue, including interest and penalties, that will be collected for fiscal year 2028 from taxes imposed under sections 297J.02 and 297K.02. If the amount estimated by the commissioner equals or exceeds $39,900,000, the commissioner shall certify that effective July 1, 2027, the rates under this paragraph apply in lieu of the rates imposed under paragraph (a), (b), or (c) and shall publish a notice to the effect in the state registry and notify taxpayers by June 1, 2027. If the rates under this paragraph apply, the combined net receipts of an organization are subject to a tax computed according to the following schedule:

	If the combined net receipts for the fiscal year are:	The tax is:
	Not over $87,500	three percent
	Over $87,500, but not over $122,500	$2,625 plus ten percent of the amount over $87,500, but not over $122,500
Journal of the House - 110th Day - Thursday, May 2, 2024 - Top of Page 15440	Over $122,500, but not over $157,500	$3,500 plus 18 percent of the amount over $122,500, but not over $157,500
	Over $157,500	$6,300 plus 26 percent of the amount over $157,500

~~(b)~~ (e) Gross receipts derived from sports-themed tipboards are exempt from taxation under this section. For purposes of this paragraph, a sports-themed tipboard means a sports-themed tipboard as defined in section 349.12, subdivision 34, under which the winning numbers are determined by the numerical outcome of a professional sporting event.

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

Page 63, delete section 2

Page 70, delete section 4 and insert:

"Sec. 4. Minnesota Statutes 2022, section 240.01, subdivision 14, is amended to read:

Subd. 14. Pari-mutuel betting. "Pari-mutuel betting" is the system of betting on horse races where those who bet on horses that finish in the position or positions for which bets are taken share in the total amounts bet, less deductions required or permitted by law. Pari-mutuel betting shall not include betting on a race that has occurred in the past or is considered historical horse racing or where bettors are not wagering on the same live or simulcast horse race or bettors do not share in the total amount of bets taken.

Sec. 5. [240.071] PROHIBITED ACTS.

A licensed racetrack shall only conduct horse racing and may be authorized to operate a card club in accordance with this chapter. A licensed racetrack shall not conduct or provide for play any other forms of gambling, including but not limited to historical horse racing, slot machines, video games of chance, and other gambling devices."

Page 71, delete section 6 and insert:

"Sec. 7. [240.231] LIMITATIONS ON RULEMAKING AND OTHER AUTHORITY.

The commission's rulemaking and other authority, whether derived from section 240.23 or other sections in this chapter, shall only pertain to horse racing and card games at a card club as expressly authorized in this chapter and shall not include the authority to expand gambling, nor the authority to approve or regulate historical horse racing, slot machines, video games of chance, and other gambling devices, by means of rulemaking, a contested case hearing, the review and approval of a plan of operation or proposed or amended plan of operation, the approval of any proposal or request, or any other commission or agency action.

Sec. 8. Minnesota Statutes 2022, section 240.30, subdivision 8, is amended to read:

Subd. 8. Limitations. The commission may not approve any plan of operation under subdivision 6 that exceeds any of the following limitations:

(1) the maximum number of tables used for card playing at the card club at any one time, other than tables used for instruction, demonstrations, or poker tournament play, may not exceed 80;

(2) except as provided in clause (3), no wager may exceed $100;

Journal of the House - 110th Day - Thursday, May 2, 2024 - Top of Page 15441

(3) for games in which each player is allowed to make only one wager or has a limited opportunity to change that wager, no wager may exceed $300.; and

(4) no inclusion of any historical horse racing or any other form of gambling that is not expressly authorized for racetracks under this chapter."

Renumber the sections in sequence

Amend the title as follows:

Page 1, line 5, before the second semicolon, insert "and modifying certain rates of tax on lawful gambling"

Correct the title numbers accordingly

With the recommendation that when so amended the bill be re-referred to the Committee on Ways and Means.

The report was adopted.

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

H. F. No. 4738, A bill for an act relating to health; establishing an Office of Emergency Medical Services to replace the Emergency Medical Services Regulatory Board; specifying duties for the office; transferring duties; establishing advisory councils; establishing alternative EMS response model pilot program; making conforming changes; requiring a report; appropriating money; amending Minnesota Statutes 2022, sections 62J.49, subdivision 1; 144E.001, by adding subdivisions; 144E.16, subdivision 5; 144E.19, subdivision 3; 144E.27, subdivision 5; 144E.28, subdivisions 5, 6; 144E.285, subdivision 6; 144E.287; 144E.305, subdivision 3; 214.025; 214.04, subdivision 2a; 214.29; 214.31; 214.355; Minnesota Statutes 2023 Supplement, sections 15A.0815, subdivision 2; 43A.08, subdivision 1a; 152.126, subdivision 6; proposing coding for new law in Minnesota Statutes, chapter 144E; repealing Minnesota Statutes 2022, sections 144E.001, subdivision 5; 144E.01; 144E.123, subdivision 5; 144E.50, subdivision 3.

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

The report was adopted.

Gomez from the Committee on Taxes to which was referred:

H. F. No. 4822, A bill for an act relating to taxation; property; modifying distribution of excess proceeds from sales of tax-forfeited property; appropriating money; amending Minnesota Statutes 2022, sections 281.23, subdivision 2; 282.08; 282.241, subdivision 1; proposing coding for new law in Minnesota Statutes, chapter 282.

Reported the same back with the following amendments:

Page 3, line 4, delete "for" and insert "that"

Page 3, line 5, delete ", which must be disposed of" and insert "are reserved for the state" and before the period, insert ", and any parcel withdrawn from sale by the commissioner of natural resources under section 282.007 must be managed as provided in section 282.007"

Journal of the House - 110th Day - Thursday, May 2, 2024 - Top of Page 15442

Page 3, line 6, delete everything after the second "the"

Page 3, line 7, delete everything before "disposed" and insert "state is deemed to have purchased the property through a credit bid and the parcels may be"

Page 3, line 14, after "means" insert "the product of (i) 1.05, and (ii)"

Page 3, line 16, delete "Redemption" and insert "Repurchase"

Page 3, line 17, delete "redeem" and insert "repurchase"

Page 3, lines 19 and 21, delete "redeemed" and insert "repurchased"

Page 3, line 31, delete "sale may be canceled and the parcels" and insert "state is deemed to have purchased the property through a credit bid and the parcels may be"

Page 4, line 1, after "auditor" insert a period

Page 4, delete lines 2 to 4 and insert "The amount of the minimum bid shall be deposited into a county's forfeited tax sale fund. The proceeds in excess of the minimum bid shall be available for distribution pursuant to subdivision 6."

Page 4, line 8, after the period, insert "The commissioner of revenue must prescribe the form and manner of the claim form."

Page 4, line 13, delete everything after "parties" and insert a period

Page 4, delete lines 14 to 19

Reletter the paragraphs in sequence

Page 4, line 23, before "payments" insert "the county must divide"

Page 4, line 24, delete "must be divided" and delete "ownership"

Page 4, line 25, delete "ownership"

Page 5, line 6, after "parties" insert "of record"

Page 5, line 7, after "party" insert "of record" and delete "certified" and insert "first class"

Page 5, line 18, after the period, insert "The commissioner of revenue must prescribe the form and manner of the claim form."

Page 5, line 20, delete "$50" and insert "the minimum bid"

Page 5, line 22, delete everything after "parties" and insert a period

Page 5, delete lines 23 to 27

Reletter the paragraphs in sequence

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Page 6, line 3, before "payments" insert "the county must divide" and delete "must be divided"

Page 6, line 29, before "purchased" insert "deemed to be"

Page 6, line 30, delete "chapter" and insert "section"

Page 7, delete section 3 and insert:

"Sec. 3. [282.007] LAND WITHDRAWN FROM INITIAL SALE.

Subdivision 1. Property withdrawn from sale. The commissioner of natural resources may withhold or withdraw from the sale required under section 282.005 any property allowed to be withheld or withdrawn from sale in section 85.012, 85.013, 282.01, subdivision 8, or 282.018. The commissioner of natural resources must condemn parcels withheld or withdrawn from sale under this section according to procedures set forth in chapter 117. Notwithstanding section 282.005, subdivision 1, any interests in iron-bearing stockpiles, minerals, or mineral interests in property withheld or withdrawn from sale under this section are not severed from the property and are not subject to section 282.005, subdivision 8.

Subd. 2. Notice. The county auditor must provide notice to the commissioner of natural resources of the forfeiture of any lands eligible to be withheld or withdrawn from sale under this section. Notice must be provided within 30 days of either the filing of the certificate of the expiration of redemption pursuant to section 281.23, subdivision 9, or the date the property is vacated by the occupant, whichever is later. Within 30 days of this notice, the commissioner of natural resources must notify the county auditor of a decision to withhold or withdraw a property from the sale under section 282.005. If no such notice is given, the county auditor must sell the property pursuant to section 282.005.

Subd. 3. Repurchase. Prior to the initiation of the condemnation proceedings of a property withheld or withdrawn from sale under this section, an interested party may repurchase the property by payment of the sum of all delinquent taxes and assessments computed under section 282.251, together with penalties, interest, and costs that accrued or would have accrued if the parcel of land had not forfeited. The county auditor must notify the commissioner of natural resources if a property is repurchased under this subdivision. A property repurchased under this subdivision is no longer subject to the requirements of this section or section 282.005. All rights and interests of all interested parties remain unaffected if a property is repurchased under this subdivision. For the purposes of this section, "interested party" has the meaning given in section 282.005, subdivision 2.

Subd. 4. Proceeds. Notwithstanding any law to the contrary in chapter 117, all proceeds from the condemnation proceedings of a property withheld or withdrawn from sale under this section must be transferred from the commissioner of natural resources to the county auditor. Any proceeds up to the value of the minimum bid are transferred to the county's forfeited tax sale fund. Any proceeds in excess of the minimum bid must be made available for claims pursuant to section 282.005, subdivision 6. For the purposes of this section, "minimum bid" has the meaning given in section 282.005, subdivision 2."

Page 8, lines 14 and 15, delete the new language

Page 9, line 2, after the period, insert "Notwithstanding the foregoing, any application to repurchase a property that is made available for sale pursuant to section 282.005 must be made before the date of that sale."

Journal of the House - 110th Day - Thursday, May 2, 2024 - Top of Page 15444

Page 9, after line 4, insert:

"Sec. 5. DEPARTMENT OF NATURAL RESOURCES; APPROPRIATION.

$3,762,000 in fiscal year 2025 is appropriated from the general fund to the commissioner of natural resources to perform the duties required under Minnesota Statutes, section 282.005. The base for this appropriation is $3,762,000 in fiscal year 2026 and each fiscal year thereafter."

Renumber the sections in sequence

Amend the title as follows:

Correct the title numbers accordingly

With the recommendation that when so amended the bill be re-referred to the Committee on Ways and Means.

The report was adopted.

Lee, F., from the Committee on Capital Investment to which was referred:

H. F. No. 5162, A bill for an act relating to capital investment; appropriating money for early childhood learning and child protection facilities; authorizing the sale and issuance of state bonds.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

"ARTICLE 1

APPROPRIATIONS

Section 1. CAPITAL IMPROVEMENT APPROPRIATIONS.

(a) The sums shown in the column under "Appropriations" are appropriated from the general fund in fiscal year 2025 to the state agencies or officials indicated, to be spent for public purposes. These are onetime appropriations. Money appropriated in this act is available until the project is completed or abandoned, subject to Minnesota Statutes, section 16A.642.

(b) For any project funded in whole or in part by this act, workers on the project must be paid at least the prevailing wage rate as defined in Minnesota Statutes, section 177.42, subdivision 6, and the project is subject to the requirements and enforcement provisions in Minnesota Statutes, sections 177.27, 177.30, 177.32, and 177.41 to 177.45. For the purposes of this act, "project" means demolition, erection, construction, remodeling, or repairing of a public building, facility, or other public work financed in whole or part by state funds. Project also includes demolition, erection, construction, remodeling, or repairing of a building, facility, or public work when the acquisition of property, predesign, design, or demolition is financed in whole or in part by state funds.

(c) Money appropriated in this act: (1) is available for a grant after the commissioner of management and budget determines that an amount sufficient to complete the project as described in this act has been committed to the project, as required by Minnesota Statutes, section 16A.502; (2) may be used to pay state agency staff costs that are attributed directly to the capital program or project for capitalizable staff costs; and (3) is subject to the policies and procedures adopted by the commissioner of management and budget or otherwise specified in applicable law.

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(d) Recipients of grants from money appropriated in this act must demonstrate to the commissioner of the agency making the grant that the recipient has the ability and a plan to fund the program intended for the facility. This paragraph does not apply to state agencies.

APPROPRIATIONS

Sec. 2. EDUCATION

$23,025,000

To the commissioner of education for library construction grants under Minnesota Statutes, section 134.45.

Sec. 3. ADMINISTRATION

Subdivision 1. Total Appropriation

$5,050,000

To the commissioner of administration for the purposes specified in this section.

Subd. 2. ADA Building Accommodation

750,000

For capital improvement expenses in accordance with Minnesota Statutes, section 16B.4805.

Subd. 3. Sustainable Building Guidelines

4,300,000

To develop, oversee, and administer sustainable building guidelines under Minnesota Statutes, section 16B.325, in consultation with the commissioner of commerce and the Center for Sustainable Building Research at the University of Minnesota. This appropriation includes money for the commissioner of administration to contract with the Center for Sustainable Building Research to administer the guidelines. This is a onetime appropriation and is available until June 30, 2027.

Sec. 4. METROPOLITAN COUNCIL

$4,080,000

To the Metropolitan Council for community tree planting grants under Minnesota Statutes, section 473.355. Notwithstanding Minnesota Statutes, section 473.355, this appropriation must be used to remove and replace ash trees on privately owned land that pose significant public safety concerns.

Sec. 5. HUMAN SERVICES

Subdivision 1. Total Appropriation

$2,000,000

To the commissioner of human services for the purposes specified in this section.

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Subd. 2. Early Childhood Facilities

2,000,000

For grants under Minnesota Statutes, section 256E.37, to predesign, design, construct, renovate, furnish, and equip early childhood learning facilities.

Sec. 6. HEALTH

$100,000

To the commissioner of health to administer the secondary sources of drinking water grant program under Minnesota Statutes, section 144.3835.

Sec. 7. CORRECTIONS

$3,906,000

To the commissioner of administration for asset preservation improvements and betterments of a capital nature at the Minnesota correctional facilities statewide to be spent in accordance with Minnesota Statutes, section 16B.307. Notwithstanding the specified uses of money under Minnesota Statutes, section 16B.307, the commissioner may use this appropriation for capital expenditures allowed under Minnesota Statutes, section 16B.307, that do not constitute betterments and capital improvements within the meaning of the Minnesota Constitution, article XI, section 5, clause (a). The report required under Minnesota Statutes, section 16B.307, subdivision 2, must include a list of projects that have been paid for with this appropriation.

Sec. 8. EMPLOYMENT AND ECONOMIC DEVELOPMENT

$1,000,000

To the commissioner of employment and economic development for a grant to the Saint Paul and Minnesota Foundation for promotion, fundraising, and other supporting efforts to raise at least $5,000,000 in nonstate funds toward capital improvements consistent with the Capitol Mall Design Framework update. This grant shall be managed in compliance with the grantmaking requirements in Minnesota Statutes, sections 16B.97 to 16B.991.

Sec. 9. CANCELLATIONS.

The amounts of the general fund appropriations listed in the cancellation report submitted to the legislature in January 2024, pursuant to Minnesota Statutes, section 16A.642, are canceled on the effective date of this section. If an appropriation in this section is canceled more than once, the cancellation must be given effect only once.

Sec. 10. EFFECTIVE DATE.

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Except as otherwise provided, this article is effective the day following final enactment.

ARTICLE 2

MISCELLANEOUS

Section 1. Minnesota Statutes 2022, section 16A.86, subdivision 3a, is amended to read:

Subd. 3a. Information provided. All requests for state assistance under this section must include the following information:

(1) the name of the political subdivision that will own the capital project for which state assistance is being requested;

(2) the public purpose of the project;

(3) the extent to which the political subdivision has or expects to provide local, private, user financing, or other nonstate funding for the project;

(4) a list of the bondable activities that the project encompasses; examples of bondable activities are public improvements of a capital nature for land acquisition, predesign, design, construction, and furnishing and equipping for occupancy;

(5) whether the project will require new or additional state operating subsidies;

(6) whether the governing body of the political subdivision requesting the project has passed a resolution in support of the project and has established priorities for all projects within its jurisdiction for which bonding appropriations are requested when submitting multiple requests;

(7) if the project requires a predesign under section 16B.335, whether the predesign has been completed at the time the capital project request is submitted, and whether the political subdivision has submitted the project predesign to the commissioner of administration for review and approval; ~~and~~

(8) the debt capacity of the political subdivision, calculated as the difference between the maximum net debt that the political subdivision may incur under chapter 475 or other applicable law and the debt the political subdivision has outstanding as of the date of the submission of information under this subdivision; and

~~(8)~~ (9) if applicable, the information required under section 473.4485, subdivision 1a.

Sec. 2. Minnesota Statutes 2022, section 16A.86, subdivision 4, is amended to read:

Subd. 4. Funding. (a) The state share of a project covered by this section and any capital project grant to a nonprofit organization subject to section 16A.642 must be no more than half the total cost of the project, including predesign, design, construction, furnishings, and equipment, except as provided in paragraph (b) or (c). This subdivision does not apply to a project proposed by a school district or other school organization. The state share of a project includes state assistance in any manner, including but not limited to a direct appropriation, a grant awarded through a grant program administered by a state entity, or a combination of state assistance appropriated and granted by multiple state entities. The nonstate share of a project may be funded by federal, local, private, or other funds, or a combination thereof, from nonstate sources.

(b) The state share may be more than half the total cost of a project if the project is deemed needed as a result of a disaster or to prevent a disaster or is located in a political subdivision with a very low average net tax capacity.

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(c) Nothing in this section prevents the governor from recommending, or the legislature from considering or funding, projects that do not meet the deadline in subdivision 2 or a state share that is greater than half the total cost of the project when the governor or the legislature determines that there is a compelling reason for the recommendation or funding.

Sec. 3. [16A.865] NOTICE OF STATE CONTRIBUTION.

Subdivision 1. Notice required. When practicable, a recipient of a grant of state bond proceeds for a capital project or a direct recipient of an appropriation from any state funds for a capital project must prominently display a notice on the property stating that the project was funded with state taxes collected statewide.

Subd. 2. Content of notice. The notice must display the logo provided by the commissioner under subdivision 5, and identify the project as "funded with a grant of state money from taxes collected statewide." The notice may include a brief name for the project and may specify the proportion of the funding from state money compared to money from nonstate sources. The notice may include logos, seals, or marks of other contributors to the cost of the project.

Subd. 3. Water infrastructure project. For a drinking water or wastewater infrastructure project, the notice required under this section must be included on city utility billing statements in all formats that the city provides billing statements to customers.

Subd. 4. Performance venues. For performance venue projects, the notice must be included in programs and on the venue's website where performances are advertised, in addition to on a sign posted at the venue.

Subd. 5. Logo. The commissioner must develop a logo for use on signs required under subdivision 1.

Subd. 6. Sign templates. The commissioner must post on its website downloadable, print-ready PDF files of sign templates that meet the requirements of subdivision 1.

EFFECTIVE DATE. This section is effective the day following final enactment and applies to projects receiving a grant from an appropriation enacted after January 1, 2024.

Sec. 4. Minnesota Statutes 2022, section 16B.325, as amended by Laws 2023, chapter 60, article 12, section 2, is amended to read:

16B.325 SUSTAINABLE BUILDING GUIDELINES.

Subdivision 1. ~~Development of~~ Sustainable building guidelines. The Department of Administration and the Department of Commerce, with the assistance of other agencies, shall develop and maintain sustainable building design guidelines for all new state buildings ~~by January 15, 2003,~~ and for all major renovations of state buildings by February 1, 2009. The primary objectives of these guidelines are to ensure that all new state buildings, and major renovations of state buildings, initially exceed the state energy code, as established in Minnesota Rules, chapter 7676, by at least 30 percent.

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

(b) "CSBR" means the Center for Sustainable Building Research at the University of Minnesota.

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(d) "Major renovation" means a project that:

(1) has a renovated conditioned area that is at least 10,000 square feet; and

(2) includes, at a minimum, the replacement of the mechanical, ventilation, or cooling system of a building or a section of a building, whether or not the building is served by an adjacent building or district system impacted by the scope of the project.

(e) "New building" means a newly constructed structure and additions to existing buildings that include spaces that meet the following criteria:

(1) space is conditioned, whether or not its source of energy is from an adjacent building or district system; and

(2) the project size is at least 10,000 gross square feet of conditioned space.

(f) "Project" means the acquisition or betterment of buildings or other fixed assets and other improvements of a capital nature.

~~Subd. 2. Lowest possible cost; energy conservation. The guidelines must:~~

~~(1) focus on achieving the lowest possible lifetime cost, considering both construction and operating costs, for new buildings and major renovations;~~

~~(2) allow for revisions that encourage continual energy conservation improvements in new buildings and major renovations;~~

(3) define "major renovations" for purposes of this section to encompass not less than 10,000 square feet or not less than the replacement of the mechanical, ventilation, or cooling system of a building or a building section;

~~(4) establish sustainability guidelines that include air quality and lighting standards and that create and maintain a healthy environment and facilitate productivity improvements;~~

(5) establish resiliency guidelines to encourage design that allows buildings to adapt to and accommodate projected climate-related changes that are reflected in both acute events and chronic trends, including but not limited to changes in temperature and precipitation levels;

~~(6) specify ways to reduce material costs; and~~

(7) consider the long-term operating costs of the building, including the use of renewable energy sources and distributed electric energy generation that uses a renewable source or natural gas or a fuel that is as clean or cleaner than natural gas.

Subd. 2a. Guidelines; purpose. (a) The primary objectives of the guidelines are to:

(1) reduce greenhouse gas emissions across the project's life cycle by promoting the design and operation of energy-efficient buildings and the development of renewable energy sources;

(2) provide high-quality indoor environmental conditions to promote occupant health, well-being, comfort, and productivity;

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(3) develop processes that ensure that projects are designed and operating as intended and that project impact can be measured;

(4) reduce water use and impacts on water resources;

(5) restore soil and water quality, enhance biodiversity, and provide sites supportive of native species;

(6) reduce the embodied environmental impact of building materials; and

(7) encourage design that allows building resilience to adapt to and accommodate projected changes that are reflected in both acute events and chronic trends, including but not limited to climate-related changes to temperature and precipitation levels.

(b) In establishing the guidelines, the commissioners of administration and commerce must consider the following to meet the objectives in paragraph (a):

(1) the health and well-being of occupants;

(2) material impacts and sustainability;

(3) construction and operating costs;

(4) the use of renewable energy sources;

(5) diversion of waste from landfills;

(6) the impact of climate change;

(7) biodiversity and ecological impacts;

(8) resilience and adaptability; and

(9) any other factors the commissioner deems relevant.

Subd. 3. ~~Development of guidelines;~~ Applicability. ~~In developing the guidelines, the departments shall use an open process, including providing the opportunity for public comment.~~ (a) Compliance with the guidelines established under this section are mandatory for all new buildings and for all major renovations receiving ~~funding~~ an appropriation or a grant from an appropriation from the bond proceeds fund ~~after January 1, 2004, and for all major renovations receiving funding from the bond proceeds fund after January 1, 2009~~.

(b) Compliance with the guidelines established under this section are mandatory for all new buildings and for all major renovations receiving an appropriation or a grant from an appropriation from the general fund after May 1, 2024.

Subd. 4. Commissioner of administration; guideline administration, oversight, and revisions. The commissioners of administration and commerce shall review the guidelines periodically and as soon as practicable revise the guidelines to incorporate performance standards developed under section 216B.241, subdivision 9. (a) The commissioner of administration must review and amend the guidelines periodically to better meet the goals under subdivision 6. Each guideline section must be reviewed and updated no less than once every five years. The review must be conducted with the commissioner of commerce and in consultation with other stakeholders. The commissioner of administration and the commissioner of commerce must use an open process, including providing the opportunity for public comment, when reviewing and amending the guidelines.

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(b) The commissioner of administration is responsible for the following:

(1) making applicability determinations on which projects are required by state law to follow the guidelines upon receipt of an applicability determination request from a project;

(2) approving or denying waiver requests for specific guidelines;

(3) approving or denying applicability requests for specific guidelines;

(4) updating the legislature regarding program outcomes;

(5) coordinating with the commissioner of commerce on the energy and atmosphere guidelines, including coordination with the Sustainable Building 2030 Energy Standards under section 216B.241, subdivision 9; and

(6) contracting with CSBR for the items in subdivision 5.

Subd. 5. CSBR; guideline administration and oversight. (a) The commissioner of administration, in consultation with the commissioner of commerce, shall contract with CSBR to implement the guidelines. At a minimum, CSBR must:

(1) maintain and update the guidelines in coordination with the commissioner of administration and the commissioner of commerce;

(2) offer training on an annual basis to state agencies, project team members, and other entities involved in the design of projects subject to the guidelines on how projects may meet the guideline requirements;

(3) develop procedures for compliance with the guidelines, in accordance with the criteria under subdivision 7;

(4) periodically conduct post-construction performance evaluations on projects to evaluate the effectiveness of the guidelines in meeting the goals under subdivision 6;

(5) determine compliance of project designs with the guidelines;

(6) administer a tracking system for all projects subject to the guidelines and for projects that received state funding for predesign or design that may seek further state funding for additional project phases subject to the guidelines;

(7) develop and track measurable goals for the guidelines in accordance with subdivision 6;

(8) offer outreach, training, and technical assistance to state agencies, project team members, and other entities with responsibility for managing, designing, and overseeing projects subject to the guidelines;

(9) evaluate waiver requests and determinations on project scope and make recommendations to the commissioner of administration;

(10) provide a report on or before December 1 annually to the commissioner of administration on the following:

(i) the current compliance status of all projects subject to the guidelines;

(ii) an analysis of the effects of the guidelines on the goals under subdivision 6; and

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(iii) waivers approved for projects, including both waivers from all of the guidelines and waivers of individual guidelines; and

(11) perform any other duties required by the commissioner of administration to administer the guidelines.

(b) State agencies, project team members, and other entities that are responsible for managing or designing projects subject to the guidelines must provide any compliance data requested by CSBR and the commissioner of administration that CSBR and the commissioner deem necessary to fulfill the duties described under this subdivision.

Subd. 6. Measurable goals. CSBR, in collaboration with the commissioner of administration and the commissioner of commerce, must develop measurable goals for the guidelines based on the objectives and considerations described in subdivision 2a. The commissioner of administration must provide final approval of the goals under this subdivision.

Subd. 7. Procedures. The commissioner of administration must develop procedures for the administration of the guidelines. The commissioner of administration may delegate guideline administration responsibilities to state agencies. The procedures under this subdivision must specify the administrative activities for which state agencies are responsible. The procedures must include:

(1) criteria to identify whether a project is subject to the guidelines;

(2) information on project team member roles and guideline administration requirements for each role;

(3) a process to notify projects subject to the guidelines of the guideline requirements;

(4) a guideline-related data submission process coordinated by the commissioner of administration;

(5) activities and a timeline to monitor project compliance with the guidelines; and

(6) record-keeping requirements and related retention schedules for materials related to guideline compliance.

Subd. 8. Guidelines waivers and scope determination. (a) The commissioner of administration, in consultation with the commissioner of commerce and other stakeholders, must develop a process for reviewing and approving waivers and scope determinations to the guidelines.

(b) A waiver may apply to all of the guidelines or individual guidelines and may identify an alternative path of meeting the intent of the guidelines.

(c) A waiver under this subdivision is only permitted due to technological limitations or when the intended use of the project conflicts with the guidelines.

(d) A waiver request for a project owned by a state agency must be reviewed and approved by the commissioner of administration. If the waiver request is for a project owned by the Department of Administration, the waiver request must be approved by the commissioner of commerce.

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Subd. 9. Report. The commissioner of administration must report to the chairs and ranking minority members of the house of representatives and senate committees with jurisdiction over capital investment and climate and energy by February 1 of each year. The report must include:

(1) information on the current status of all projects subject to the guidelines from the previous five years and the projects' compliance with the guidelines;

(2) an analysis of the effects of the guidelines on the measurable goals under subdivision 6;

(3) progress made toward the recommendations in the report required under Laws 2023, chapter 71, article 1, section 6, subdivision 4; and

(4) any other information the commissioner of administration deems relevant.

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

Sec. 5. Minnesota Statutes 2022, section 16B.335, subdivision 4, is amended to read:

Subd. 4. Sustainable buildings; energy conservation. A recipient to whom a direct appropriation is made for a capital improvement project shall ensure that the project complies with the applicable sustainable building guidelines and energy conservation standards contained in law, including sections 16B.325 and 216C.19 to 216C.20, and rules adopted thereunder. The recipient may obtain information and technical assistance from the commissioner of administration on the sustainable building guidelines and the State Energy Office in the Department of Commerce on energy conservation and alternative energy development relating to the planning and construction of the capital improvement project.

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

Sec. 6. [16B.336] CAPITAL PROJECT REPLACEMENT ACCOUNTS.

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

(b) "Adjusted net tax capacity" means, as of any date, the net tax capacity of all taxable property most recently determined by the commissioner of revenue in accordance with section 273.1325.

(c) "Adjusted net tax capacity per capita" means a political subdivision's adjusted net tax capacity divided by the political subdivision's population.

(d) "Commissioner" means the commissioner of administration.

(e) "Population" has the meaning under section 477A.011, subdivision 3.

(f) "Preservation" means improvements and betterments of a capital nature consistent with those described in section 16B.307, subdivision 1, paragraph (d).

Subd. 2. Replacement account establishment. (a) A grantee that receives a direct appropriation of state money for a capital project subject to section 16A.642, 16A.695, or 16A.86 must establish a capital project replacement fund for major rehabilitation, expansion, replacement, or preservation of the capital project once the project has reached its useful life, or another use as permitted under this section. Money must remain in the account for the useful life of the capital project, as determined by the grant agreement with the granting state agency, unless use of the fund is approved in writing by the granting state agency for major rehabilitation, expansion, replacement, or preservation of the capital project funded with state money, or to address a capital project for a different capital asset owned by the grantee.

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(b) A grantee must adopt a capital project replacement policy that specifies the following for the capital project replacement fund:

(1) the risks to be mitigated or managed by the fund;

(2) the intended use of the replacement fund, including but not limited to how the fund will be used for major rehabilitation, expansion, replacement, or preservation of the capital project; and

(3) criteria for the use of the fund to address other capital improvement needs of the grantee, including safety and security, maintenance and utility costs, availability of repair parts and materials, sustainability, and any other criteria the grantee deems relevant.

(c) For the purposes of this section, "grantee" does not include a state agency, state official, the Board of Regents of the University of Minnesota, or the Board of Trustees of the Minnesota State Colleges and Universities.

Subd. 3. Minimum deposits; fund balance. (a) The commissioner must determine the annual minimum deposit amounts into capital project replacement funds by capital project type. The commissioner must take into account depreciation, construction cost inflation, the useful life of the capital project, and other relevant factors when determining the minimum deposit amounts.

(b) A grantee must not be required to maintain a capital project replacement fund balance greater than the amount of the direct appropriation of state money for the capital project.

Subd. 4. Account auditing. The state auditor may audit capital project replacement accounts as part of the regular audits of local governments.

Subd. 5. Exceptions. (a) Capital projects that already require a replacement fund under section 446A.072, subdivision 12, or any other law, rule, or ordinance, are exempt from the requirements under this section, so long as the deposits into the replacement fund are at least as large as the minimum deposits established by the commissioner under subdivision 3.

(b) This section does not apply to a grantee that assesses the condition and replacement value of its capital projects through a capital funding budget process which includes an annual long-term budget schedule or capital improvement plan for maintaining capital projects subject to section 16A.642, 16A.695, or 16A.86.

(c) This section does not apply to a political subdivision grantee that has an adjusted net tax capacity per capita that is less than the median adjusted net tax capacity per capita of all political subdivisions that are the same type of political subdivision as the grantee.

Subd. 6. Penalty. Failure of a grantee to comply with the requirements of this section shall result in the granting state agency assessing a penalty fee to the grantee equal to one percent of the appropriation of state money for the capital project for each year of noncompliance. Penalty fees shall be remitted by the granting state agency to the commissioner of management and budget for deposit into the general fund.

EFFECTIVE DATE. This section is effective for capital projects funded through state capital project grant agreements entered into on or after July 1, 2024.

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Sec. 7. [144.3835] SECONDARY SOURCES OF DRINKING WATER GRANT PROGRAM.

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

(b) "Community water system" means a public water system owned by a political subdivision which serves at least 15 service connections used by year-round residents or regularly serves at least 25 year-round residents.

(c) "Supplemental demographic index" means an index in the Environmental Justice Screening and Mapping Tool developed by the United States Environmental Protection Agency that is based on socioeconomic indicators, including low income, unemployment, less than high school education, limited English speaking, and low life expectancy.

Subd. 2. Establishment; purpose. The commissioner shall develop a grant program for the purpose of providing communities with a secondary source of drinking water that ensures an uninterrupted supply of safe drinking water in case of a disruptive event.

Subd. 3. Grants authorized. (a) The commissioner shall award grants to community water systems that currently only have one well as a source of drinking water. The commissioner shall prescribe the content, form, and manner of a grant application under this section and shall examine and consider all applications for grants. If the commissioner determines that a community water system is ineligible for a grant under this section, the commissioner must promptly notify the community water system in writing of the determination and the reasons for the determination.

(b) Priority shall be given to community water systems that meet the following criteria:

(1) the population served is 3,300 or less;

(2) the community water system plans to use the funds for a backup well; and

(3) the community water system is located in a census block or blocks with a supplemental demographic index score of 70 percent or greater.

Subd. 4. Grant allocation. Grantees must use the funds to secure a secondary source of drinking water such as a backup well or other secondary source of drinking water that allows the community water system to continue to provide drinking water in case of a disruptive event such as a well failure or contamination.

Sec. 8. Minnesota Statutes 2023 Supplement, section 174.38, subdivision 3, is amended to read:

Subd. 3. Active transportation accounts. (a) An active transportation account is established in the special revenue fund. The account consists of funds provided by law and any other money donated, allotted, transferred, or otherwise provided to the account. Money in the account is annually appropriated to the commissioner and must be expended only on projects that receive financial assistance under this section.

(b) An active transportation account is established in the bond proceeds fund. The account consists of state bond proceeds appropriated to the commissioner. Money in the account may only be expended on bond-eligible costs of a project receiving financial assistance as provided under this section. Money in the account may only be expended on a project that is publicly owned.

(c) An active transportation account is established in the general fund. The account consists of money as provided by law and any other money donated, allotted, transferred, or otherwise provided to the account. Money in the account may only be expended on a project receiving financial assistance as provided under this section.

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Sec. 9. [473.355] COMMUNITY TREE-PLANTING GRANTS.

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

(b) "Shade tree" means a woody perennial grown primarily for aesthetic or environmental purposes with minimal to residual timber value.

Subd. 2. Grants. (a) The Metropolitan Council must establish a grant program to provide grants to cities, counties, townships, Tribal governments, and implementing agencies for the following purposes:

(1) removing and planting shade trees on public or Tribal land to provide environmental benefits;

(2) replacing trees lost to forest pests, disease, or storms; or

(3) establishing a more diverse community forest better able to withstand disease and forest pests.

(b) Any tree planted with money granted under this section must be a climate-adapted species to Minnesota.

Subd. 3. Priority. (a) Priority for grants awarded under this section must be given to:

(1) projects removing and replacing ash trees that pose significant public safety concerns; and

(2) projects located in a census block or blocks with a supplemental demographic index score of 70 percent or greater.

(b) The Metropolitan Council may not prioritize projects based on criteria other than the criteria established under paragraph (a).

Subd. 4. Eligible projects. (a) The proceeds of state general obligation bonds may only be expended for grants to cities, counties, townships, and implementing agencies.

(b) Appropriations from the general fund may be expended for grants to Tribal governments, cities, counties, townships, and implementing agencies.

Sec. 10. Laws 2023, chapter 71, article 1, section 6, subdivision 4, is amended to read:

Subd. 4. Sustainable Building Guidelines; Recommendations and Report

304,000

To develop recommendations for updating goals, measuring project performance in meeting the goals, applicability, compliance, waivers, outreach, and administration of the sustainable building guidelines under Minnesota Statutes, section 16B.325, in collaboration with the commissioner of commerce and the Center for Sustainable Building Research at the University of

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Minnesota. The commissioner of administration may contract with the commissioner of commerce and the Center for Sustainable Building Research at the University of Minnesota for assistance in developing the recommendations, including obtaining input from public owners, nonprofit owners, design professionals, and other stakeholders. The commissioner of administration must provide a report of findings and recommendations to the chairs and ranking minority members of the legislative committees with jurisdiction over capital investment, energy finance and policy, and environment finance and policy on or before October 15, 2023. Upon completion of development of the recommendations, any remaining funds may be utilized to begin implementation of the recommendations.

Sec. 11. CAPITOL MALL DESIGN FRAMEWORK UPDATE; MATCHING FUNDS.

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

(b) "Capitol Mall Design Framework update" means the Capitol Mall Design Framework update required by Laws 2023, chapter 62, article 2, section 124.

(c) "Nonstate funds" means money secured from private sources, including individuals and businesses, toward the Capitol Mall Design Framework update.

Subd. 2. Capitol Mall Design Framework; use of nonstate funds. (a) Nonstate funds must be used to predesign, design, construct, furnish, and equip improvements and betterments of a capital nature consistent with the Capitol Mall Design Framework update.

(b) The commissioner of administration shall coordinate the expenditure of nonstate funds toward the Capitol Mall Design Framework update improvements. Any unspent nonstate funds may be used by the commissioner of administration for improvements and betterments of a capital nature consistent with the Capitol Mall Design Framework update.

Sec. 12. EFFECTIVE DATE.

Except as otherwise provided, this article is effective the day following final enactment."

Delete the title and insert:

"A bill for an act relating to capital investment; authorizing spending to acquire and better land and buildings and for other improvements of a capital nature with certain conditions; establishing and modifying programs; canceling prior appropriations; appropriating money; amending Minnesota Statutes 2022, sections 16A.86, subdivisions 3a, 4; 16B.325, as amended; 16B.335, subdivision 4; Minnesota Statutes 2023 Supplement, section 174.38, subdivision 3; Laws 2023, chapter 71, article 1, section 6, subdivision 4; proposing coding for new law in Minnesota Statutes, chapters 16A; 16B; 144; 473."

With the recommendation that when so amended the bill be re-referred to the Committee on Ways and Means.

The report was adopted.

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Lee, F., from the Committee on Capital Investment to which was referred:

H. F. No. 5220, A bill for an act relating to capital investment; authorizing spending to acquire and better public land and buildings and for other improvements of a capital nature with certain conditions; establishing new programs and modifying existing programs; modifying prior appropriations; authorizing the sale and issuance of state bonds; appropriating money; amending Minnesota Statutes 2022, sections 16A.642, subdivision 1; 446A.07, subdivision 8; 446A.072, subdivision 5a; 446A.073, subdivision 1; 462A.37, by adding a subdivision; Minnesota Statutes 2023 Supplement, sections 256E.37, subdivision 1; 446A.081, subdivision 9; 462A.37, subdivision 5; Laws 2020, Fifth Special Session chapter 3, article 1, sections 14, subdivisions 5, 6; 25; Laws 2023, chapter 72, article 1, section 27; proposing coding for new law in Minnesota Statutes, chapters 16B; 115B; 174; 446A; repealing Minnesota Statutes 2022, section 16A.662.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

"ARTICLE 1

APPROPRIATIONS

Section 1. CAPITAL IMPROVEMENT APPROPRIATIONS.

(a) The sums shown in the column under "Appropriations" are appropriated from the bond proceeds fund, or another named fund, to the state agencies or officials indicated, to be spent for public purposes. Appropriations of bond proceeds must be spent as authorized by the Minnesota Constitution, article XI, section 5, clause (a), to acquire and better public land and buildings and other public improvements of a capital nature, or as authorized by the Minnesota Constitution, article XI, section 5, clauses (b) to (j), or article XIV. Unless otherwise specified, money appropriated in this act:

(1) may be used to pay state agency staff costs that are attributed directly to the capital program or project in accordance with accounting policies adopted by the commissioner of management and budget;

(2) is available until the project is completed or abandoned subject to Minnesota Statutes, section 16A.642;

(3) for activities under Minnesota Statutes, sections 16B.307, 84.946, and 135A.046, should not be used for projects that can be financed within a reasonable time frame under Minnesota Statutes, section 16B.322 or 16C.144;

(4) is subject to the policies and procedures adopted by the commissioner of management and budget or otherwise specified in applicable law; and

(5) is available for a grant to a political subdivision after the commissioner of management and budget determines that an amount sufficient to complete the project as described in this act has been committed to the project, as required by Minnesota Statutes, section 16A.502.

(b) Unless otherwise specified, appropriations in this article from the general fund or from the trunk highway fund are made in fiscal year 2025 and are onetime appropriations.

(c) Recipients of grants from money appropriated in this article must demonstrate to the commissioner of the agency making the grant that the recipient has the ability and a plan to fund the program intended for the facility. This paragraph does not apply to state agencies.

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APPROPRIATIONS

Sec. 2. UNIVERSITY OF MINNESOTA

Subdivision 1. Total Appropriation

$64,000,000

To the Board of Regents of the University of Minnesota for the purposes specified in this section.

Subd. 2. Higher Education Asset Preservation and Replacement (HEAPR)

64,000,000

To be spent in accordance with Minnesota Statutes, section 135A.046.

This appropriation must be used to fully fund the following projects:

(1) to predesign, design, construct, and equip critical utility infrastructure improvements for the heating plant on the Crookston campus;

(2) to predesign, design, construct, and equip the repair or replacement of the HVAC system in the Library Annex facility on the Duluth campus and other capital improvements to comply with federal, state, and local building code requirements;

(3) to predesign, design, renovate, furnish, and equip improvements to the Multi-Ethnic Resource Center, originally constructed in 1899, on the Morris campus;

(4) to predesign, design, construct, and equip the repair or replacement of HVAC and plumbing systems and roofs on buildings throughout the Southern Research and Outreach Center in the city of Waseca; and

(5) to design and construct the replacement of the pedestrian enclosure and suicide deterrent barriers on the Washington Avenue Pedestrian Bridge on the Twin Cities campus. The board must consult with persons impacted by suicide at this bridge, suicide prevention organizations, and experts in the field of suicide prevention in designing the project.

Sec. 3. MINNESOTA STATE COLLEGES AND UNIVERSITIES

Subdivision 1. Total Appropriation

$64,000,000

To the Board of Trustees of the Minnesota State Colleges and Universities for the purposes specified in this section.

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Subd. 2. Higher Education Asset Preservation and Replacement (HEAPR)

64,000,000

To be spent in accordance with Minnesota Statutes, section 135A.046.

Sec. 4. EDUCATION

$302,699,000

To the commissioner of education for library construction grants under Minnesota Statutes, section 134.45.

Sec. 5. MINNESOTA STATE ACADEMIES

Subdivision 1. Total Appropriation

$7,500,000

To the commissioner of administration for the purposes specified in this section.

Subd. 2. Asset Preservation

3,000,000

For capital asset preservation improvements and betterments on both campuses of the Minnesota State Academies, to be spent in accordance with Minnesota Statutes, section 16B.307.

Subd. 3. Blind Library Building Renovation

4,500,000

To predesign, design, renovate, furnish, and equip the Blind Library building to address safety and accessibility concerns and repurpose the space for current student needs.

Sec. 6. PERPICH CENTER FOR ARTS EDUCATION

$4,000,000

To the commissioner of administration for capital asset preservation improvements and betterments at the Perpich Center for Arts Education, to be spent in accordance with Minnesota Statutes, section 16B.307.

Sec. 7. NATURAL RESOURCES

Subdivision 1. Total Appropriation

$65,500,000

(a) To the commissioner of natural resources for the purposes specified in this section.

(b) The appropriations in this section are subject to the requirements of the natural resources capital improvement program under Minnesota Statutes, section 86A.12, unless this section or the statutes referred to in this section provide more specific standards, criteria, or priorities for projects than Minnesota Statutes, section 86A.12.

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Subd. 2. Natural Resources Asset Preservation

20,000,000

For the preservation and replacement of state-owned facilities and recreational assets operated by the commissioner of natural resources to be spent in accordance with Minnesota Statutes, section 84.946.

Subd. 3. Betterment of Buildings

30,000,000

For acquisition, predesign, design, and construction to replace existing facilities that no longer meet the business needs of the department or to acquire or construct new facilities. This appropriation must first be used for construction of Drill Core Library Building #4 and associated facility components at the Drill Core Library in the city of Hibbing, and for predesign, design, and construction of facility capital improvements and associated facility components at the Badoura State Forest Nursery.

Subd. 4. Accessibility

2,000,000

For the design and construction of accessibility improvements at state parks, recreation areas, and wildlife management areas.

Subd. 5. Flood Hazard Mitigation

3,000,000

(a) For the state share of flood hazard mitigation grants for publicly owned capital improvements to prevent or alleviate flood damage under Minnesota Statutes, section 103F.161.

(b) Project priorities shall be determined by the commissioner as appropriate, based on need and consideration of available leveraging of federal, state, and local funds.

(c) To the extent practicable and consistent with the project, recipients of appropriations for flood control projects in this subdivision shall create wetlands that are eligible for wetland replacement credit to replace wetlands drained or filled as the result of repair, reconstruction, replacement, or rehabilitation of an existing public road under Minnesota Statutes, section 103G.222, subdivision 1, paragraphs (l) and (m).

(d) To the extent that the cost of a municipal project exceeds two percent of the median household income in the municipality multiplied by the number of households in the municipality, this appropriation is also for the local share of the project.

Subd. 6. Community Tree Planting

8,000,000

For grants under Minnesota Statutes, section 84.705. This appropriation must be used for qualified capital projects.

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Subd. 7. Reforestation

2,500,000

For reforestation and stand improvement on state forest lands to meet the reforestation requirements of Minnesota Statutes, section 89.002, subdivision 2, including purchasing native seeds and native seedlings, planting, seeding, site preparation, and protection on state lands administered by the commissioner.

Subd. 8. Unspent Appropriations

The unspent portion of an appropriation for a project in this section that is complete, upon written notice to the commissioner of management and budget, is available for asset preservation under Minnesota Statutes, section 84.946. Minnesota Statutes, section 16A.642, applies from the date of the original appropriation to the unspent amount transferred.

Sec. 8. POLLUTION CONTROL AGENCY

Subdivision 1. Total Appropriation

$12,000,000

To the Pollution Control Agency for the purposes specified in this section.

Subd. 2. Statewide Drinking Water Contamination Mitigation Program

4,000,000

For projects or grants under Minnesota Statutes, section 115B.245.

Subd. 3. Capital Assistance Programs

8,000,000

For grants under Minnesota Statutes, section 115A.54.

Sec. 9. BOARD OF WATER AND SOIL RESOURCES

Subdivision 1. Total Appropriation

$9,862,000

To the Board of Water and Soil Resources for the purposes specified in this section.

Subd. 2. Local Government Roads Wetland Replacement Program

3,862,000

To acquire land or permanent easements and to restore, create, enhance, and preserve wetlands to replace those wetlands drained or filled as a result of the repair, reconstruction, replacement, or rehabilitation of existing public roads as required by Minnesota Statutes, section 103G.222, subdivision 1, paragraphs (l) and (m). Notwithstanding Minnesota Statutes, section 103G.222, subdivision 3, the board may implement the wetland replacement program consistent with section 404 of the federal Clean Water

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Act. The purchase price paid for acquisition of land or perpetual easement must be a fair market value as determined by the board. The board may enter into agreements with the federal government, other state agencies, political subdivisions, nonprofit organizations, fee title owners, or other qualified private entities to acquire wetland replacement credits in accordance with Minnesota Rules, chapter 8420. Up to five percent of this appropriation may be used for restoration and enhancement.

Subd. 3. Reinvest in Minnesota (RIM) Reserve Program

6,000,000

To acquire conservation easements from landowners to preserve, restore, create, and enhance wetlands and associated uplands of prairie and grasslands, and to restore and enhance rivers and streams, riparian lands, and associated uplands of prairie and grasslands, in order to protect soil and water quality, support fish and wildlife habitat, reduce flood damage, and provide other public benefits. The provisions of Minnesota Statutes, section 103F.515, apply to this program. The board shall give priority to leveraging federal money by enrolling targeted new lands or enrolling environmentally sensitive lands that have expiring federal conservation agreements. The board is authorized to enter into new agreements and amend past agreements with landowners as required by Minnesota Statutes, section 103F.515, subdivision 5, to allow for restoration. Up to ten percent of this appropriation may be used for restoration, rehabilitation, and enhancement.

Sec. 10. MINNESOTA ZOOLOGICAL GARDEN

$15,000,000

To the Minnesota Zoological Board to design, construct, furnish, and equip a new animal hospital building at the Minnesota Zoological Garden.

Sec. 11. ADMINISTRATION

Subdivision 1. Total Appropriation

$32,344,000

To the commissioner of administration for the purposes specified in this section.

Subd. 2. Capitol Tunnel

8,500,000

To design, construct, and equip improvements to a portion of the tunnel connecting the State Office Building with the State Capitol necessary to bring the tunnel into compliance with the Americans with Disabilities Act.

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Subd. 3. Capital Asset Preservation and Replacement Account

2,044,000

To be spent in accordance with Minnesota Statutes, section 16A.632.

Subd. 4. Transportation Building- Physical Security Upgrades

1,800,000

From the trunk highway fund, for the design, construction, and equipping required to upgrade the physical security elements and systems for the Transportation building and its attached tunnel systems, surrounding grounds, and parking facilities as identified in the 2017 Minnesota State Capitol Complex Physical Security Predesign completed by Miller Dunwiddie and an updated assessment completed in 2022. Upgrades include but are not limited to the installation of bollards, blast protection, infrastructure security screen walls, door access controls, emergency call stations, surveillance systems, security kiosks, lighting enhancements, locking devices, and traffic and crowd control devices.

Subd. 5. ADA Accessibility

8,000,000

To be spent in accordance with Minnesota Statutes, section 16B.308.

Subd. 6. Capitol Mall Improvements

12,000,000

To predesign, design, construct, furnish, and equip improvements and betterments of a capital nature to the upper mall and lower mall of the Minnesota State Capitol consistent with the Capitol Mall Design Framework update required by Laws 2023, chapter 62, article 2, section 124. This appropriation includes money for Americans with Disabilities Act compliance, security, and landscaping improvements.

Sec. 12. AMATEUR SPORTS COMMISSION

Subdivision 1. Total Appropriation

$9,226,000

To the Minnesota Amateur Sports Commission for the purposes specified in this section.

Subd. 2. Asset Preservation

9,226,000

For asset preservation improvements and betterments of a capital nature at the National Sports Center in Blaine, to be spent in accordance with Minnesota Statutes, section 16B.307.

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Sec. 13. MILITARY AFFAIRS

Subdivision 1. Total Appropriation

$3,000,000

To the adjutant general for the purposes specified in this section.

Subd. 2. Duluth Hangar Design

3,000,000

To predesign and design the construction of a new hangar to hold aircraft at the Duluth International Airport in support of the 148th Fighter Wing of the Minnesota Air National Guard to replace existing hangars.

Sec. 14. PUBLIC SAFETY

Subdivision 1. Total Appropriation

$47,998,000

To the commissioner of administration for the purposes specified in this section.

Subd. 2. Southern Minnesota BCA Regional Office and Laboratory

47,998,000

To construct, furnish, and equip a new Bureau of Criminal Apprehension regional office and laboratory facility in Mankato.

Sec. 15. TRANSPORTATION

Subdivision 1. Total Appropriation

$45,700,000

To the commissioner of transportation for the purposes specified in this section.

Subd. 2. Major Local Bridge Replacement and Rehabilitation Program

37,700,000

From the bond proceeds account in the state transportation fund for grants under Minnesota Statutes, section 174.50, subdivision 6d.

Subd. 3. Port Development Assistance Program

8,000,000

For grants under Minnesota Statutes, chapter 457A. Any improvements made with the proceeds of these grants must be publicly owned.

Sec. 16. METROPOLITAN COUNCIL

Subdivision 1. Total Appropriation

$31,000,000

To the Metropolitan Council for the purposes specified in this section.

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Subd. 2. Metropolitan Cities Inflow and Infiltration Grants

15,000,000

For grants under Minnesota Statutes, section 473.5491.

Subd. 3. Metropolitan Regional Parks and Trails

8,000,000

For the cost of improvements and betterments of a capital nature and acquisition by the council and local government units of regional recreational open-space lands in accordance with the council's policy plan as provided in Minnesota Statutes, section 473.147. This appropriation must not be used to purchase easements.

Subd. 4. Community Tree Planting Grants

8,000,000

For grants under Minnesota Statutes, section 473.355.

Sec. 17. HUMAN SERVICES

Subdivision 1. Total Appropriation

$20,266,000

To the commissioner of administration, or other named entity, for the purposes specified in this section.

Subd. 2. Asset Preservation

12,266,000

For asset preservation improvements and betterments of a capital nature at Department of Human Services facilities statewide, to be spent in accordance with Minnesota Statutes, section 16B.307. The commissioner of administration may use this appropriation for improvements and betterments of a capital nature to be spent in accordance with Minnesota Statutes, section 16B.307, at facilities operated by the Department of Direct Care and Treatment following the department's separation from the Department of Human Services.

Subd. 3. Early Childhood Facilities Grants

8,000,000

To the commissioner of human services for grants under Minnesota Statutes, section 256E.37, to predesign, design, construct, renovate, furnish, and equip early childhood learning facilities.

Sec. 18. HEALTH

$6,000,000

To the commissioner of health for grants under Minnesota Statutes, section 144.3835.

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Sec. 19. VETERANS AFFAIRS

Subdivision 1. Total Appropriation

$28,857,000

To the commissioner of administration for the purposes specified in this section.

Subd. 2. Asset Preservation

12,812,000

For asset preservation improvements and betterments of a capital nature at the veterans homes in Minneapolis, Hastings, Fergus Falls, Silver Bay, and Luverne, and the state veterans cemeteries at Little Falls, Preston, and Duluth, to be spent in accordance with Minnesota Statutes, section 16B.307.

Subd. 3. Minneapolis Veterans Home - Building 16 Remodel

16,045,000

To design, construct, furnish, and equip the renovation of the Minneapolis Veterans Home Building 16.

Sec. 20. CORRECTIONS

Subdivision 1. Total Appropriation

$114,024,000

To the commissioner of administration for the purposes specified in this section.

Subd. 2. Asset Preservation

60,000,000

For asset preservation improvement and betterments of a capital nature at the Minnesota correctional facilities statewide to be spent in accordance with Minnesota Statutes, section 16B.307.

Subd. 3. Minnesota Correctional Facility - Rush City

46,585,000

To design, construct, furnish, and equip a new building addition and to renovate existing space to provide incarcerated persons services at the Rush City Correctional Facility.

Subd. 4. Lino Lakes Treatment and Programming Space

7,439,000

To predesign, design, construct, renovate, furnish and equip an existing building and complete associated site work at the Minnesota Correctional Facility - Lino Lakes to construct an incarcerated persons programming and support space. The renovation of the existing building includes but is not limited to the removal of hazardous materials, upgrades to comply with current codes, interior demolition, and the construction of spaces appropriate for programming functions.

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Subd. 5. Unspent Appropriations

The unspent portion of an appropriation for a Department of Corrections project in this section that is complete, upon written notice to the commissioner of management and budget, is available for asset preservation under Minnesota Statutes, section 16B.307. Minnesota Statutes, section 16A.642, applies from the date of the original appropriation to the unspent amount transferred.

Sec. 21. EMPLOYMENT AND ECONOMIC DEVELOPMENT

Subdivision 1. Total Appropriation

$4,000,000

To the commissioner of employment and economic development for the purposes specified in this section.

Subd. 2. Greater Minnesota Business Development Public Infrastructure

2,000,000

For grants under Minnesota Statutes, section 116J.431.

Subd. 3. Transportation Economic Development Infrastructure

2,000,000

For grants under Minnesota Statutes, section 116J.436.

Sec. 22. PUBLIC FACILITIES AUTHORITY

Subdivision 1. Total Appropriation

$57,000,000

To the Public Facilities Authority for the purposes specified in this section.

Subd. 2. State Match for Federal Grants to State Revolving Loan Programs

39,000,000

To match federal capitalization grants for the clean water revolving fund under Minnesota Statutes, section 446A.07, and the drinking water revolving fund under Minnesota Statutes, section 446A.081. This appropriation must be used for qualified capital projects.

Subd. 3. Water Infrastructure Funding Program

8,000,000

(a) For grants to eligible municipalities under the water infrastructure funding program under Minnesota Statutes, section 446A.072.

(b) $4,000,000 is for wastewater projects listed on the Pollution Control Agency's project priority list in the fundable range under the clean water revolving fund program.

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(c) $4,000,000 is for drinking water projects listed on the commissioner of health's project priority list in the fundable range under the drinking water revolving fund program.

(d) After all eligible projects under paragraph (b) or (c) have been funded in a fiscal year, the Public Facilities Authority may transfer any remaining, uncommitted money to eligible projects under a program defined in paragraph (b) or (c) based on that program's project priority list.

Subd. 4. Emerging Contaminants Grant Program

10,000,000

For grants to eligible municipalities under the Emerging Contaminants Grant Program under Minnesota Statutes, section 446A.082.

Sec. 23. MINNESOTA HOUSING FINANCE AGENCY

Subdivision 1. Total Appropriation

$36,500,000

To the Minnesota Housing Finance Agency for the purposes specified in this section.

Subd. 2. Public Housing Rehabilitation

32,000,000

To the Minnesota Housing Finance Agency to finance the costs of rehabilitation to preserve public housing under Minnesota Statutes, section 462A.202, subdivision 3a. For purposes of this section, "public housing" means housing for low-income persons and households financed by the federal government and publicly owned. Priority may be given to proposals that maximize nonstate resources to finance the capital costs and requests that prioritize health, safety, and energy improvements. The priority in Minnesota Statutes, section 462A.202, subdivision 3a, for projects to increase the supply of affordable housing and the restrictions of Minnesota Statutes, section 462A.202, subdivision 7, do not apply to this appropriation.

Subd. 3. Greater Minnesota Housing Infrastructure Grants

4,500,000

For grants under Minnesota Statutes, section 462A.395, subdivision 3, paragraph (b).

Sec. 24. MINNESOTA HISTORICAL SOCIETY

Subdivision 1. Total Appropriation

$5,588,000

To the Minnesota Historical Society for the purposes specified in this section.

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Subd. 2. Historic Sites Asset Preservation

5,588,000

For capital improvements and betterments at state historic sites, buildings, landscaping at historic buildings, exhibits, markers, and monuments, to be spent in accordance with Minnesota Statutes, section 16B.307. The society shall determine project priorities as appropriate based on need.

Sec. 25. MINNESOTA MANAGEMENT AND BUDGET

$1,300,000

From the general fund to the commissioner of management and budget to prepay or defease any outstanding state general obligation bonds used for improvements and betterments at the University of Minnesota Cloquet Forestry Center, and other associated financing costs. This amount may be deposited, invested, and applied to accomplish the purposes of this section as provided in Minnesota Statutes, section 475.67, subdivisions 5 to 10, and 13. Upon the prepayment or defeasance of all associated debt on the real property and improvements, all conditions set forth in Minnesota Statutes, section 16A.695, subdivision 3, shall be deemed to have been satisfied and the real property and improvements shall no longer constitute state bond financed property under Minnesota Statutes, section 16A.695.

Sec. 26. BOND SALE AUTHORIZATIONS.

Subdivision 1. Bond proceeds fund. To provide the money appropriated in this act from the bond proceeds fund, and to provide for expenses authorized in section 16A.641, subdivision 8, paragraph (c), the commissioner of management and budget shall sell and issue bonds of the state in an amount up to $947,550,000 in the manner, upon the terms, and with the effect prescribed by Minnesota Statutes, sections 16A.631 to 16A.675, and by the Minnesota Constitution, article XI, sections 4 to 7.

Subd. 2. Transportation fund. To provide the money appropriated in this act from the bond proceeds account in the state transportation fund, the commissioner of management and budget shall sell and issue bonds of the state in an amount up to $37,700,000 in the manner, upon the terms, and with the effect prescribed by Minnesota Statutes, sections 16A.631 to 16A.675, and by the Minnesota Constitution, article XI, sections 4 to 7.

Sec. 27. BOND SALE SCHEDULE.

The commissioner of management and budget shall schedule the sale of state general obligation bonds so that, during the biennium ending June 30, 2025, no more than $1,136,805,000 will need to be transferred from the general fund to the state bond fund to pay principal and interest due and to become due on outstanding state general obligation bonds. During the biennium, before each sale of state general obligation bonds, the commissioner of management and budget shall calculate the amount of debt service payments needed on bonds previously issued and shall estimate the amount of debt service payments that will be needed on the bonds scheduled to be sold. The commissioner shall adjust the amount of bonds scheduled to be sold so as to remain within the limit set by this section. The amount needed to make the debt service payments is appropriated from the general fund as provided in Minnesota Statutes, section 16A.641.

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Sec. 28. CANCELLATIONS; BOND SALE AUTHORIZATION REDUCTIONS.

(a) The amounts of the general obligation bond proceeds appropriations and trunk highway bond proceeds appropriations listed in the cancellation report submitted to the legislature in January 2024, pursuant to Minnesota Statutes, section 16A.642, are canceled on the effective date of this section. The corresponding bond sale authorizations are reduced by the same amounts. If an appropriation in this section is canceled more than once, the cancellation must be given effect only once.

(b) The appropriation in Laws 2023, chapter 72, article 1, section 18, subdivision 5, paragraph (c), is canceled. The corresponding bond sale authorization in Laws 2023, chapter 72, article 1, section 27, subdivision 1, is reduced by the same amount.

Sec. 29. EFFECTIVE DATE.

Except as otherwise provided, this article is effective the day following final enactment.

ARTICLE 2

MISCELLANEOUS

Section 1. [16B.308] ACCESSIBILITY ACCOUNT.

Subdivision 1. Establishment. An accessibility account is established in the state bond proceeds fund to receive state bond proceeds appropriated to the commissioner of administration to be expended for the purpose and in accordance with the standards and criteria in this section.

Subd. 2. Standards. (a) An expenditure may be made from the account only when it is a capital expenditure on a capital asset owned by the state, within the meaning of accepted accounting principles as applied to public expenditures. The commissioner of administration must consult with the commissioner of management and budget to the extent necessary to ensure that an expenditure meets the criteria of the Minnesota Constitution, article XI, section 5, clause (a).

(b) An expenditure may be made from the account to predesign, design, construct, renovate, furnish, and equip accessibility improvements on state-owned property. For purposes of this section, "state-owned property" does not include property controlled or managed by the University of Minnesota.

(1) removal of architectural barriers from a building or site; and

(2) improvements to meet state and federal requirements for accessibility for people with disabilities.

Subd. 3. Applications; project selection. (a) The commissioner of administration must:

(1) provide instructions to state agencies to apply for funding of capital expenditures from the accessibility account;

(2) review applications for funding;

(3) make initial allocations among eligible projects;

(4) determine priorities for funding in collaboration with the Minnesota Council on Disability; and

(5) allocate money in priority order until the available appropriation has been committed.

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Subd. 4. Report. On or before January 15 annually the commissioner of administration must submit to the commissioner of management and budget and the chairs and ranking minority members of the committees in the senate and the house of representatives with jurisdiction over capital investment a list of the projects that were funded with money from the accessibility account during the preceding calendar year, as well as a list of priority projects for which accessibility appropriations will be requested in that year's legislative session.

Sec. 2. [84.705] COMMUNITY TREE-PLANTING GRANTS.

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

(b) "Shade tree" means a woody perennial grown primarily for aesthetic or environmental purposes with minimal to residual timber value.

Subd. 2. Grants. (a) The commissioner must establish a grant program to provide grants to cities, counties, townships, Tribal governments, and park and recreation boards in cities of the first class for the following purposes:

(1) removing and planting shade trees on public or Tribal land to provide environmental benefits;

(2) replacing trees lost to forest pests, disease, or storms; or

(3) establishing a more diverse community forest better able to withstand disease and forest pests.

(b) Any tree planted with money granted under this section must be a climate-adapted species to Minnesota.

Subd. 3. Priority. (a) Priority for grants awarded under this section must be given to:

(1) projects removing and replacing ash trees that pose significant public safety concerns; and

(2) projects located in a census block or blocks with a supplemental demographic index score of 70 percent or greater.

(b) The commissioner may not prioritize projects based on criteria other than the criteria established under paragraph (a).

Subd. 4. Eligible projects. (a) The proceeds of state general obligation bonds may only be expended for grants to cities, counties, townships, and park and recreation boards in cities of the first class.

(b) Appropriations from the general fund may be expended for grants to Tribal governments, cities, counties, townships, and park and recreation boards in cities of the first class.

Sec. 3. [115B.245] STATEWIDE DRINKING WATER CONTAMINATION MITIGATION PROGRAM.

Subdivision 1. Program established. (a) The commissioner may design and construct, or may make grants to eligible grantees as provided under this section to design and construct, projects to provide safe drinking water, due to contamination of drinking water by hazardous substances, through projects such as treatment systems, new drinking water wells, sealing contaminated wells, and connecting to alternative drinking water sources. The criteria for selecting projects must follow the criteria and rules established under section 115B.17.

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(b) The commissioner must prioritize projects located in a census block or blocks with a supplemental demographic index score of 70 percent or greater.

Subd. 2. Definitions. (a) For purposes of this section, the following terms have the meanings given.

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

(1) for projects funded from proceeds of bonds authorized by the Minnesota Constitution, article XI, section 5, clause (a), a city, county, school district, joint powers board, or other political subdivision of the state; and

(2) for projects funded from appropriations from the general fund, any person.

(d) "Private infrastructure projects" means improvements made to nonpublicly owned infrastructure such as sealing of private wells, connecting private properties to water mains, water service fees, treatment systems, and drilling new private wells in an unimpaired drinking water aquifer.

(e) "Public infrastructure projects" means improvements made to publicly owned infrastructure such as water main installation, public water system improvements, treatment systems, and associated improvements.

(f) "Supplemental demographic index" means an index in the Environmental Justice Screening and Mapping Tool developed by the United States Environmental Protection Agency that is based on socioeconomic indicators, including low income, unemployment, less than high school education, limited English speaking, and low life expectancy.

Subd. 3. Eligible projects. (a) The proceeds of state general obligation bonds may only be expended to acquire land or an interest in land and to predesign, design, construct, and improve public infrastructure projects that further the purposes of this section. Notwithstanding section 115B.17, subdivision 6 or 16, any money recovered in a civil action for a project financed with bonds under this section shall be transferred to the commissioner of management and budget and applied toward principal and interest on outstanding bonds.

(b) Appropriations from the general fund may only be expended on public or private infrastructure projects that further the purposes of this section.

Sec. 4. [144.3835] SECONDARY SOURCES OF DRINKING WATER GRANT PROGRAM.

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

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(b) Priority shall be given to community water systems that meet the following criteria:

(1) the population served is 3,300 or less;

(2) the community water system plans to use the funds for a backup well; and

(3) the community water system is located in a census block or blocks with a supplemental demographic index score of 70 percent or greater.

Subd. 4. Grant allocation. Grantees must use the funds to acquire, predesign, design, construct, and improve a secondary source of drinking water such as a backup well or other secondary source of drinking water that allows the community water system to continue to provide drinking water in case of a disruptive event such as a well failure or contamination.

Sec. 5. Minnesota Statutes 2023 Supplement, section 256E.37, subdivision 1, is amended to read:

Subdivision 1. Grant authority. The commissioner may make grants to state agencies ~~and~~, political subdivisions, nonprofit organizations, Indian Tribal governments, or private child care providers licensed as a child care center or to provide in-home family child care to construct or rehabilitate facilities for early childhood programs, crisis nurseries, or parenting time centers. The following requirements apply:

(1) For grants funded with general obligation bonds, the facilities must be owned by the state or a political subdivision, but may be leased under section 16A.695 to organizations that operate the programs. The commissioner must prescribe the terms and conditions of the leases.

(2) For grants funded with general fund appropriations, the facilities may be owned by a political subdivision, nonprofit organization, Tribal government, or private child care provider licensed as a child care center or to provide in-home family child care.

~~(2)~~ (3) A grant for an individual facility must not exceed $500,000 for each program that is housed in the facility, up to a maximum of $2,000,000 for a facility that houses three programs or more. Programs include Head Start, School Readiness, Early Childhood Family Education, licensed child care, and other early childhood intervention programs.

~~(3)~~ (4) State appropriations must be matched on a 50 25 percent basis with nonstate funds. The matching requirement must apply program wide and not to individual grants.

Sec. 6. [446A.082] EMERGING CONTAMINANTS GRANTS.

Subdivision 1. Definition. For the purposes of this section, "supplemental demographic index" means an index in the Environmental Justice Screening and Mapping Tool developed by the United States Environmental Protection Agency that is based on socioeconomic indicators, including low income, unemployment, less than high school education, limited English speaking, and low life expectancy.

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Subd. 2. Program established. When money is appropriated under this program, the authority shall award grants to a governmental unit for up to 80 percent of the cost of drinking water infrastructure projects to address a confirmed exceedance of a health advisory level for a drinking water emerging contaminant as defined by the Environmental Protection Agency.

Subd. 3. Eligibility. An eligible project for this program must:

(1) be listed on the Drinking Water Revolving Fund Project Priority List per Minnesota Rules, part 4720.9015;

(2) receive priority points under Minnesota Rules, part 4720.9020, subpart 4a; and

(3) be certified by the commissioner of health per Minnesota Rules, part 4720.9060.

Subd. 4. Application and reservation of funds. (a) Grant applications to the authority may be made at any time on forms prescribed by the authority, including a project schedule and cost estimate for the work necessary to comply with the purpose described in subdivision 2.

(b) The commissioner of health shall review and certify to the authority those projects that have plans and specifications approved under Minnesota Rules, part 4720.9060. The commissioner of health must also indicate in the certification the supplemental demographic index scores of the projects.

(c) When a project is certified by the commissioner of health, the authority shall first reserve grant funds for projects located in a census block or blocks with a supplemental demographic index score of 70 percent or greater. Any remaining funds shall be reserved for projects in the order listed on the commissioner of health's project priority list and in an amount based on the cost estimate in the commissioner of health certification or the as-bid costs, whichever is less.

Subd. 5. Grant amount. The grant amount for an eligible project under this program shall be for an amount up to 80 percent of the eligible as-bid project cost up to $12,000,000, minus the amount of federal emerging contaminant funds the project receives under section 446A.081, subdivision 9, paragraph (a), clause (12), or other federal emerging contaminant funds.

Subd. 6. Grant approval. The authority shall award a grant for an eligible project only after:

(1) the applicant has submitted the as-bid project cost;

(2) the commissioner of health has certified the grant eligible portion of the project; and

(3) the authority has determined that the additional financing necessary to complete the project has been committed from other sources.

Subd. 7. Grant disbursement. Grant funds shall be disbursed by the authority as eligible project costs are incurred by the governmental unit and in accordance with a project financing agreement and applicable state laws and rules governing the disbursements.

Sec. 7. Minnesota Statutes 2023 Supplement, section 462A.395, is amended to read:

462A.395 GREATER MINNESOTA HOUSING INFRASTRUCTURE GRANT PROGRAM.

Subdivision 1. Grant program established. The commissioner of the Minnesota Housing Finance Agency may make grants to counties and cities to provide up to 50 percent of the capital costs of public infrastructure necessary for an eligible workforce housing development project. The commissioner may make a grant award only

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after determining that nonstate resources are committed to complete the project. The nonstate contribution may be cash, other committed grant funds, or in kind. In-kind contributions may include the value of the site, whether the site is prepared before or after the law appropriating money for the grant is enacted.

Subd. 2. Definitions. (a) For the purposes of this section, the following terms have the meanings given.

(b) "City" means a statutory or home rule charter city located outside the metropolitan area, as defined in section 473.121, subdivision 2.

(c) "Housing infrastructure" means publicly owned physical infrastructure necessary to support housing development projects, including but not limited to sewers, water supply systems, utility extensions, streets, wastewater treatment systems, stormwater management systems, and facilities for pretreatment of wastewater to remove phosphorus.

Subd. 3. Eligible projects. Housing projects eligible for a grant under this section may be (a) a single-family or multifamily housing development, and either owner-occupied or rental.; or (b) a manufactured home development qualifying for homestead treatment under section 273.124, subdivision 3a.

Subd. 4. Application. (a) The commissioner must develop forms and procedures for soliciting and reviewing applications for grants under this section. At a minimum, a city or county must include in its application a resolution of the county board or city council certifying that the required nonstate match is available. The commissioner must evaluate complete applications for funding for eligible projects to determine that:

(1) the project is necessary to increase sites available for housing development that will provide adequate housing stock for the current or future workforce; and

(2) the increase in workforce housing will result in substantial public and private capital investment in the county or city in which the project would be located.

(b) The determination of whether to make a grant for a site is within the discretion of the commissioner, subject to this section. The commissioner's decisions and application of the criteria are not subject to judicial review, except for abuse of discretion.

Subd. 5. Maximum grant amount. A county or city may receive no more than ~~$30,000~~ $40,000 per lot for single-family, duplex, triplex, or fourplex housing developed, no more than $60,000 per manufactured housing lot, and no more than $180,000 per lot for multifamily housing with more than four units per building. A county or city may receive no more than $500,000 in two years for one or more housing developments. The $500,000 limitation does not apply to use on manufactured housing developments.

Sec. 8. [473.355] COMMUNITY TREE-PLANTING GRANTS.

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

(b) "Shade tree" means a woody perennial grown primarily for aesthetic or environmental purposes with minimal to residual timber value.

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